Gopalasami Naick and Another vs Nammalwar Naick

Phillips, J.—Appellants'' chief contention is that plaintiff can have no cause of action until money has been recovered from him in execution.

In Viraraghava Reddi v. Subbakka ILR (1882) M. 397 a similar suit was held by the majority of this Court to be one to recover damages for the

breach of the implied promise to certify the payment to the Court and thereby make it effectual in execution. The third Judge, no doubt, based the

right of suit on the failure to discharge a statutory duty. The two views are very similar, but the former is, I think, more accurate, for the duty of

certifying satisfaction imposed by the CPC can be performed at any time, and no period is prescribed for its performance, whereas if the cause of

action be held to be the breach of an implied covenant not to execute the decree, any application for execution would be a breach of the covenant,

and would give a right to sue for damages. I think therefore that plaintiff had a cause of action, when the execution application of 1910 was filed,

but a suit on that cause of action would now be barred under Article 115 of the Limitation Act. As plaintiff cannot act upon this breach of the

covenant, he relies upon a subsequent breach in 1913, treating the first breach as condoned and in this view his suit is within time.

Treating the suit as one for damages the measure of damages is not necessarily the sum paid by plaintiff in satisfaction of the decree together

with subsequent interest, for that is the maximum amount of damages that plaintiff could suffer if the decree were actually executed and plaintiff

could only claim that sum if it were actually recovered from him. In the present case it is necessary to consider how far plaintiff has been damaged

by the filing of the execution application which is the breach of covenant complained of. He would be entitled to all expenses incurred by him in

defending the claim, and also to compensation for any moral or mental worry caused by the fact that an executable decree is unlawfully kept alive,

and steps may be taken against the judgment-debtor at any moment. I therefore agree in the order proposed by my learned brother.

Krishnan, J.

The facts necessary for the decision of this Second Appeal may be briefly stated as follow. A mortgage decree was obtained by the father of

defendants 1 and 2 against the plaintiff and his sons in 1906. In 1907 plaintiff paid Rs. 500 towards this decree; this payment though denied by

defendants has been found to be true by both the Lower Courts. Plaintiff alleged a further payment of Rs. 40 but that has not been proved.

Without certifying the payment of Rs. 500 and without graving credit for it defendants applied for execution for the whole decree amount, first in

July 1910 and then again in June 1913. In July 1914 plaintiff brought this suit praying that the defendants may be directed to certify payment or to

pay back the amount paid with interest at 18 per cent. The Lower Courts disallowed the first prayer; the Munsif held that it could be granted only

in execution proceedings under Order XXI, Rule 2, Civil Procedure Code; and no objection was taken to this view in the Appellate Court. The

Munsif had dismissed the suit in toto as barred by limitation but the District Judge has given a decree for Rs. 500 and interest at 18 per cent, as

claimed

The first point argued before us is that as no money had been realised in execution of the decree plaintiff had no cause of action at all. We must

therefore consider what the nature of the plaintiff''s suit is and what his rights are. The nature of a suit like the one before us was considered by a

Full Bench of this High Court in Viraraghava Reddi v. Subbakka ILR (1882) Mad. 397 and though Kindersley, J., was of opinion that the suit

should be taken as based on the ground of fraud or negligence on the part of the decree-holder in not certifying the payment to Court as he was

under a statutory obligation to do, the majority consisting of Turner, C.J., and Muthuswami Aiyar, J., considered it to be ""a suit to recover

damages for the breach of the implied promise to certify the payment to the Court and thereby make it effectual in execution."" I am prepared to

follow the view of the majority that the suit is really one for damages for breach of implied contract. When a decree-holder receives from the

judgment-debtor money outside court in payment of the decree amount, if there is no express agreement between the parties at the time, it may

properly be held that the decree-holder does so under an implied promise that he would certify that payment as required by law and that he would

not execute the decree any more for the amount or realise the amount again in execution. If this is the implied contract, as I think it is, the breach

will give rise to a cause of action; and it is clear that the decree-holder commits a breach as soon as he files his execution petition claiming the same

amount again. It seems to me therefore that the filing of the execution petition in itself gives a cause of action though no money may have been

realised; and successive applications will give rise to successive breaches and fresh caused of action. If money is subsequently realised that will give

a fresh cause of action as a further breach of the covenant. In each case the amount of damages payable for the breach will have to be ascertained.

Where money is realised from the judgment-debtor in execution over again, that amount of course will form the main portion of the damages but

where it is not so realised as in the present case the damages awarded can only be by way of compensation for any injury caused to plaintiff and

for any loss that he may have been put to, by the decree, which ought to have been treated as part satisfied, being attempted to be executed in full

against him. That of course will not include the amount that has not yet been realised.

This view is to some extent supported by the ruling in In the matter of Medai Kaliani Anni ILR (1907) Mad 545 thought that case does not deal

with the measure of damages. There the claim was treated as one based on the ground of breach of duty; but as already stated I am inclined to

think that is really a breach of an implied contract as held by the majority in the full Bench. The case in Sriramulu v. Dalayya (1905) 16 M.L.J. 51

has been cited to us as against this view. But that case contains no discussion of the law and no reasons are given for the view held and I am unable

to follow it. It overlooks the fact that coercive processes may be adopted in execution of a decree and considerable injury may be caused thereby

to the judgment-debtor without any money being realised. If the decree-holder''s action in taking out fresh execution was wrongful, there is no

reason why he should not be liable in damages resulting from it. The ruling in Arunachalla Pillai v. Appavu Pillai (1866) 3. M.H.C.R. 188 is no

longer law as it was departed from the later Full Bench in Viraragava Reddi v. Subbakka ILR (1882) Mad. 397. I therefore hold that the recovery

of the decretal amount in execution was not essential to give a cause of auction to the plaintiff and this suit is maintainable.

The next question argued is one of limitation. Respondent''s vakil contended that Article 120 should be applied. But that is a residuary article

and can be applied only if no other article applies. In the view I am taking of the nature of the suit, it clearly falls under Article 115 so far as it

claims refund of ""the money paid. The relief claimed by way of injunction to direct defendants to certify payment was disallowed by the first court

and not asked for in the appellate court and has been expressly abandoned before us by the respondent''s vakil, as he was entitled to do. It is not

therefore necessary to discuss what article applied to the suit with reference to that relief; nor is it necessary to consider whether such relief could

be given in a suit.

We have a case here of two successive breaches of implied contract by two successive applications in execution, one made in 1910 and the

other in 1913. So far as the claim is based on the first application it is baited by limitation as the suit was filed in 1914,i. e., more than three years

from the date of the cause of action But the plaintiff is entitled to damages resulting from the application in 1913 as he is within time for it. The

decree of the Lower Court is clearly erroneous in holding that the plaintiff was entitled to recover the whole of the money paid by him with 18 pet

cent interest If defendants had realised the money a second time that would have formed a proper item of damages but not otherwise. There must

be a finding on the question ""what damages, if any, is plaintiff entitled to as the result of defendants'' execution application in 1913 "" Parties may

adduce fresh evidence, Finding two months; objections seven days.

[In compliance with the order contained in the above Judgment, the District Judge of Tinnevely submitted a finding to the effect that the plaintiff

sustained no damages in connection with the execution proceedings]

Upon the finding that plaintiff has sustained no damages in connection with the execution proceedings he had no grounds for coming to Court.

His suit must therefore be dismissed, but in the circumstances each party will bear his own costs throughout.