Inder Prasad and Others vs Naurang Kuar and Others

Chatterji, J.—These two analogous appeals arise from the suits of the plaintiffs for contribution. The facts for the purpose of these appeals may be briefly stated as follows: Rambirichh Prasad Sahu, defendant 1 was the owner of seven properties; four out of these say, a, b, c and gha were hypothecated by way of simple mortgage on the 11th Kartik 1318 (1911) to Mt, Kailashpati Kuer, mother of defendant 17.

On the, 30th Chait 1319 (1912) Rambirichh mortgaged properties ka, kha, ga and gha to one Ramnaresh. The plaintiffs were private purchasers of the property ka by a kabana dated 9th December 1915. Defendant 2 purchased property kha by a kabala dated 1st November 1915. Defendants 3 to 15, for and on behalf of defendant 16 purchased, property ga by a kabala on 10th April 1918. The property gha comprised three items, namely property gha 1, gha 2, and gha 3. Mt. Kailashpati brought her Suit on the foot of her mortgage in 1915 without making Ramnaresh the second mortgagee a party and obtained a decree which was made absolute in 1917; that decree was executed in 1919 arid the whole of the mortgaged properties, were brought to sale in February 1920. The properties a, b, and c, were purchased by different persons who are not parties to these suits and Kailashpati purchased the property gha. She subsequently disposed of properties gha 2 and gha 3 to other persons who ate defendants in this suit, and she retained possession of the property gha 1 only which is now in the possession of defendant 17 her minor son. Ramnaresh in his turn brought his suit on 5th August 1918 without impleading Mt. Kailashpati as a defendant and obtained the preliminary decree on 10th January 1920 which was made absolute on 9th October 1920. That decree was executed on 26th June 1922, and the mortgaged properties were advertised for sale. The plaintiffs, deposited the entire decretal dues on 13th November 1922 and thus the said-decree was fully satisfied and discharged. They then commenced their; suits, on 9th November 1928 in the, Court, of the-Second Munsif Buxar, claiming contribution against the several defendants, the owners of the properties hha, kha, and gha as also of the property gha comprising gha 1, gha 3. The owners of the properties a, b and c were not made parties; the suit was contested mainly by defendant 17 and the subsequent transferee from Mt. Kailashpati oil the ground that she being prior mortgagee was not at all liable to contribute, it may be noted that in the plaint; no reference was made to the prior: most-gage of the 11th Kartik 1318, it: being, generally, stated that; Mt. Kailashpati purchased the property gha in execution of a decree against the: mortagor.

The learned Munsif decreed the plaintiffs'' claim. The plaintiffs alleged that defendants purchaser of the property kha had paid his quota; defendants 3 to 16 the purchasers of the property ga, did not prefer any appeal so, that the decree as against, them was final. It follows that the decree of the Subordinate Judge dismissing the suits in toto cannot be upheld as there is no-reason why the plaintiffs should be deprived of their decrees so far as they related to defendants 3 to 16 and the appeals must be allowed to that extent.

Defendant 17 and the transferees preferred an appeal from the decree of the Munsif to the Additional Subordinate Judge who was of the view that as Ramnaresh had not been made a party in the suit brought by Mt. Kailashpati he retained his right to redeem the prior mortgage. The plaintiffs having satisfied the mortgage dues of Ramnaresh had stepped into his shoes and had therefore the same right to redeem the prior mortgage, but they had no right to compel the prior mortgagee to contribute to them, and their only remedy was to redeem the prior mortgage. Section 82, T.P. Act, relates to the equities between mortgagors inter se and not those which arise between the'' subsequent and the prior mortgagees. Being subrogated to the rights of Ram naresh the plaintiffs had every right to enforce their dues against each and, every part of the property which formed the security, but that did not give them any right to enforce payment from the prior mortgagee and transferees. He did not think that there was any necessity of declaring any charge on the properties in the circumstances. On these findings he allowed the appeals and reversed the judgment of the Munsif and ordered the suits to be dismissed.

The learned advocate for the appellants argued that the learned Subordinate Judge was wrong in holding that the only remedy of the plaintiffs lay in redeeming the prior mortgagee. That was not the scope of their suit which was one only in contribution based on Section 83, T.P. Act. They at any rate were not the assignees of Ramnaresh and that if they were subrogated to his rights that was only for the purpose of protecting their own rights. The provisions of Section 82, T.P. Act, were clear and gave them the right to call for contribution from the several owners of the part of the security in the mortgage in favour of Ramnaresh. It is undoubtedly true that a mortgage debt is one and indivisible, but the mortgagee, Mt. Kailashpati having purchased in execution the property gha forming a part of the security, it was open to the plaintiffs to insist on their right to contribution as after all Mt. Kailashpati Kuer was a purchaser of a part of the equity of redemption and was thus relegated to the position of a co-mortgagor, and the property gha could not escape the liability to contribute to the dues on the mortgage deed of Ramnaresh.

Section 82 enacts that where several properties, whether of one or several owners, are mortgaged to Secure one debt, such properties are, in the absence of a contract to the contrary, liable to contribute rateably to the debt secured by the mortgage, after deducting from the value of each property the amount of any other incumbrance to which it is subject at the date of the mortgage. I am of the view that the learned Subordinate Judge was in error in holding that the plaintiffs could not claim their rights to contribution. But the real difficulty comes in ascertaining the rateable liability of the property gha. The learned advocate contended that the value of the property gha could be easily ascertained. It was nothing but a rateable value of the entire properties forming the security of the prior mortgage, and that being the amount of the previous encumbrance could be deducted from the value of the property gha at the date of the mortgage in favour of Ramnaresh. The words amount of any other encumbrance have been held in Aziz Ahmad Khan and Others Vs. Chhote Lal and Others as not meaning the amount which would be payable by the property, having regard to proportionate value of the property and any other property which may be subject to the same mortgage. Mookerjea, J., held that there is no justification for reading the word "encumbrance" as "mortgage" and there is no justification for holding that the words "amount of any other encumbrance" meant " proportionate mortgage money payable according to a rule of contribution--it indicates the total amount of the mortgage money--and this the appellants were and are not prepared or willing to pay; and having carefully read the judgment in that case I would with respect follow it and the result would be practically the same as found by the learned Subordinate Judge, namely that the plaintiffs have got to redeem the prior mortgage before they can claim contribution in the present suits. In my view also all the facts and materials and the necessary evidence for an effective consideration of the question are not before the Court and the ascertaining of the value of the property gha even if the appellant''s contention is accepted in the absence of the owners of the properties, a, b and o, would be likely to do injustice to defendant 17 and the subsequent transferees from Mt. Kailashpati. The suits have been badly framed and all the materials were not before the Court. In the circumstances, subject to the slight modifications as above set forth, the decrees of the learned Subordinate Judge will be confirmed. The appellants will bear the costs of the contesting respondents in this Court.

Fazl Ali, J.

Section 82, T.P. Act, enunciates the rule of contribution where several properties are mortgaged and provides: (1) that each property is, in the absence of a contract to the contrary, liable to contribute rateably to the debt secured by the mortgage; and (2) for the purpose of determining the rate of contribution the value of the property will be deemed to be the value of the property at the date of the mortgage after deducting the amount of any other mortgage to which it may have been subject on that date. In this case the properties in Sch. gha and certain other properties had been previously mortgaged to defendant 17 and a question arose before us whether in determining the amount which the properties of Sch. gha were liable to contribute, the total amount of the mortgage money due to defendant 17 was to be deducted from the value of the property or only such amount of the mortgage debt was to be deducted as was proportionate to the value of the property. In the case of Aziz Ahmad Khan and Others Vs. Chhote Lal and Others Mukherjee, J., took the view that in such a case the total amount of the mortgage money would represent the liability of each of the mortgaged properties for the purpose of Section 82, T.P. Act. The reasoning adopted by that learned Judge may be reproduced in his own words as follows:

If we ask ourselves the question, what is the amount of a prior mortgage on a particular property? we would readily get the answer which would indicate the total amount of the mortgage money Nobody would think of saying: although the total amount of the mortgage money recoverable from this property is Rs. 10,000 yet because with this property several others have been together mortgaged, the mortgage money on this property is really Rs. 2,000. We cannot, except by-doing violence to the language of the section read the words "amount of any other encumbrance" as meaning the amount which would be payable by the property having regard to the proportionate value of this property and any other property which may be subject to the same mortgage.

It has been urged that if we do not accept the'' defendants'' interpretation, we shall be doing great injury to the defendants, inasmuch as some of the properties which have been more than one mortgaged will practically escape from contribution.... This argument need not deter us. There are several answers to this objection. The argument comes to this only that if we read Section 82 naturally, we shall be obliged to exclude some of the properties which are heavily encumbered from contribution. When the sixth mortgagee accepted some of the heavily encumbered properties as his security, and, when the mortgagors gave those properties of the part of the security, both the mortgagors and the mortgagee knew that the value of those properties, as security, was worthless.... If we consider supposed oases of "hardship" we can point out the possibility of similar supposed hard cases, if the interpretation contended for on behalf of the defendants were adopted. We have already said that if the language of the statute be plain, it is not open to us to consider whether that language would create any hardship or not.... We are dearly of opinion that there is no justification...for holding that the words "amount of any other encumbrance" mean proportionate mortgage money payable according to a rule of contribution.

This is the only reported decision in which the point has been directly and clearly dealt with and the reasons in support of the view are certainly entitled to consideration. I am however not quite sure whether the view expressed in this decision does not require further examination. As however my learned brother is inclined to agree with this view and as I am also, as at present advised, not prepared to go so far as to hold that the view is wholly untenable, I shall reserve my opinion on this point. I however agree with my learned brother that the suit was badly framed and it is difficult to properly value the various properties concerned. In these circumstances, subject to the modification indicated in my learned brother''s judgment the appeal will have to be dismissed with costs.