Krishnasami Pattar vs Gopalakrishna Reddiar

Jackson, J.—Petitioner seeks to revise the decree of the Subordinate Judge, Chingleput, in S. C. S. No. 283 of 1924.

Petitioner and first defendant executed a pro-note in favour of one Perundevi Ammal, the petitioner being only a surety. First defendant sold his

property to second defendant on the condition that the second defendant would pay off Perundevi Ammal among other creditors. Petitioner paid

Perundevi Ammal and sued second defendant as well as first defendant. The lower Court was apparently prepared to hold that Perundevi Ammal

would be entitled to sue defendant; but unsuited petitioner as against second defendant because he was only a surety claiming by reason of his

having discharged the debt. Hence the petition.

The counter-petitioner seeks to uphold the judgment on the ground that even Perundevi Ammal would have no right to sue, and he relies upon

Iswaram Pillai v. Taragan [1915] 38 Mad. 753 which lays down that a stranger to the contract cannot sue the promisor. But suits of this character

have been admitted on another principle that the property is held in trust for the creditors for which proposition there is strong authority in Deb

Narain Dut v. Chuni Lal Ghose [1913] 41 Cal. 137 and Ramaswami Aiyar v. Deivasigamani Pillai A. I. R. 1922 Mad. 397 the case referred to by

the Subordinate Judge. Devadoss, J., sitting in this Court in Singaraya v. Subbayya A. I. R. 1924 Mad. 861 has examined all the authorities, and

has come to the conclusion that plaintiff in such cases is entitled to an equitable relief. I agree, and it is unnecessary to traverse the same ground.

There remains the question whether a surety occupies the same place as the original creditor. The learned Subordinate Judge gives no authority

for his view. On the other hand, regard must be had to Section 140, Indian Contract Act, which gives the surety upon payment of the debt all the

rights which the creditor had against the principal debtor. That this principle has wide application is shown by the Master of the Rolls in Drew v.

Lockett [1863] 32 Beav. 499 A surety who pays off the debt for which he became surety must be entitled to all the equities which the creditor

could have enforced not merely against the principal debtor, but also against all persons claiming under him. As Markby, J., observes in Heera Lall

Samunt v. Oozeer Ali 21 W. R. 347 ""he can use every remedy.

The petitioner is, therefore, entitled to a decree against second defendant with costs throughout and the decree of the lower Court is modified

accordingly.