Mannankatti Ammal vs Vaiyapuri Udayar and others

Veeraswami, J.—The question in this appeal is whether the settlement deed executed by the first defendant on 29th August 1959 is binding

on him. Both the Courts below held that it was not. The plaintiff who on the strength of the settlement sought and failed to obtain a declaration of

her title to and injunction in respect of the suit properties, has come up to this Court in second appeal. The plaintiff is the elder sister of the first

defendant. Their father and the plaintiff''s husband had died years ago. It is in evidence that the plaintiff was living with the first defendant for 20

years past managing his properties. She brought him up practically from his young age and got him also married. The first defendant''s wife, the

second defendant, is said to have contracted leprosy about four years prior to the settlement deed and at the time of its execution she had a

daughter and another child in the womb. Six months after the settlement deed, the 2nd defendant was delivered of a female child. The settlement

deed was executed by the first defendant at Chidambaram where it was registered. The A Schedule properties, which consisted of bulk of the

properties owned by the first defendant, were settled by him absolutely on the plaintiff. The remaining properties were settled by him on the 2nd

defendant for life with the remainder to the first defendant''s daughter Neelavathi absolutely. There was a further provision that if Neelavathi

predeceased her mother, the B Schedule properties should be taken by the plaintiff herself absolutely. The settlement deed recited that pursuant

thereto, the first defendant had delivered possession of A Schedule properties to the plaintiff. Then came a provision which stated that since the

second defendant was living with the first defendant and that though he had handed over the B Schedule properties to her, she was bound to

maintain him during his lifetime. The reason for the execution of the settlement deed was mentioned to be that A and B Schedule properties had

been acquired by the joint exertions of the first defendant''s father and the husband of the plaintiff. An additional reason as, stated in the settlement

deed, was that as the second defendant was suffering from a skin disease, the first defendant might not be able to gel any male child by her.

According to the plaintiff, the first defendant had been instigated by Duraiswami Odayar and Appavoo Pillai, who have given evidence on her

side to question the title of the plaintiff to the suit properties under the settlement deed and the first defendant, as a result, was attempting to

trespass upon them. She, therefore, sought for a declaration of her title to and for an injunction restraining the first defendant from interfering with

her possession of the properties. Both the defendants resisted the suit on various grounds. The first defendant denied having executed the

settlement deed in favour of the plaintiff and averred that the plaintiff''s son and one Kuppuswami Odayan took him to different places presumably

for consultation in collection with his wife''s skin disease and while at Chidambaram they procured a document from him the contents and nature of

which he never agreed to. The first defendant maintained that the settlement deed was a fraudulent document got from him taking advantage of the

confidential relationship and his mental weakness. According to him, he came to know only later that what he had been made to execute, was a

settlement deed. The second defendant, while supporting the case of the first defendant, further pleaded that the first defendant was not a normal

man, that he did not know the distinction between good and bad, that he had been simply obeying the orders of the plaintiff all along, who was

managing the properties right through and that, in the circumstances, the settlement was not executed by the first defendant with his free consent,

but was executed as a result of fraud and undue influence.

In the light of the findings of both the Courts below, it is now common ground that the plaintiff, as a matter of fact, was in management of the

properties covered by the settlement deed for over 20 years prior to the suit and that she brought up the first defendant after the death of his father

and got him married. He was practically a do-little, leaving the entire responsibility of managing his properties to the plaintiff. In fact, both the

Courts below have recorded their impression that a look at the first defendant was enough to show that he was not in a position to manage and

look after his lands. The second defendant was afflicted by leprosy and she had a minor daughter when the settlement deed was executed and

another daughter was born to her six months after its execution. The findings of both the Courts below were also that the settlement deed was

executed by the first defendant at Chidambaram after he had been taken from place to place by the plaintiff''s son and one Kuppuswami. The

lower appellate Court went so far even to say that the first defendant was mentally imbecile. In the light of those circumstances both the Courts

were inclined to think that the settlement deed was got executed by undue influence, misrepresentation, fraud and deceit. The Courts below

derived further support for their view by reference to the extent and nature of the dispositions themselves in the settlement deed. The settlement

deed reserved nothing for the first defendant who had completely denuded himself of all his properties by executing it.

More than the bulk of the properties were given to the plaintiff absolutely. In the event of the first defendant''s first daughter predeceasing her

mother, even the remaining properties covered by the B Schedule to the settlement should be taken by the plaintiff absolutely. The second daughter

was at the time of the execution of the settlement deed in the womb of her mother and the child was actually born six months after its execution.

Nevertheless, no provision was made for the child to be born. In addition, the reasons given for the execution of the settlement deed were, as a

matter of fact, found to be not true. Both the Courts below have found that the properties were not the joint acquisitions of the first defendant''s

father and the husband of the plaintiff. Another recital in the settlement deed as already noticed, was that because the first defendant had no hope

of getting a son by the second defendant he was executing the settlement deed. But this reason evidently appeared to be not quite true because the

first defendant must have known that the second defendant was pregnant at the time. These circumstances, according to the Courts below,

provided additional grounds for not upholding the settlement.

Sri K. S. Naidu, the learned Counsel for the appellant, pressed before me, that although the defendants come to Court with a specific case that

the settlement deed was vitiated by undue influence, actually in the evidence of the first defendant his case was that he executed the settlement deed

under the belief that it was a power of attorney. The learned Counsel further contended that even in respect of the case of undue influence there

was absolutely no evidence in support of it, It was argued that it was for that first defendant who challenged the settlement on the ground of undue

influence to establish that fact. On the other hand, the contention of Sri T. M. Krishna-swami Aiyar, the learned Counsel for respondents 1 to 3,

was that having regard to the position and relationship of the plaintiff and the first defendant and also to the fact that the first defendant was more or

less a ward of the plaintiff who had brought him up and got him married and that she was in management of his properties for over 20 years prior

to suit, a presumption of undue influence arose and that in the circumstances it was for the plaintiff to establish that the first defendant had executed

the settlement deed voluntarily and with a free mind.

It is no doubt true, as contended by Sri K. S. Naidu, that the first defendant changed his version when giving evidence, from undue influence to

misrepresentation. It is also true that the lower appellate Court was not quite right in thinking that the first defendant was mentally imbecile. The

lower appellate Court formed that impression because in its opinion the trial Court was convinced about it by a look at the first defendant. Sri K.

S. Naidu contended that a reading of the first defendant''s evidence would show that he was far from mentally imbecile. Sri T. M. Krishnaswami

Aiyar did not support the observation of the lower appellate Court that the first defendant was mentally imbecile. But the fact remains that his

mental condition had to be assessed in the setting of the entire circumstances. Viewed in that manner, it appears to me that the first defendant was

certainly under the influence of the plaintiff who did everything for him both in respect of his personal welfare and also of his properties, for long

years. Sri K. S. Naidu adverted to the observations of the lower appellate Court that no provision was made for the maintenance of the first

defendant and contended that this was entirely wrong. I do not entirely agree with him. The only provision made in the settlement deed is that

during the lifetime of the second defendant she should maintain the first defendant. What was to happen, to the maintenance of the first defendant if

the second defendant predeceased him, was not mentioned. Although Sri K. S. Naidu criticised the observation of the lower appellate Court it

was also right in making it that no provision was made in the settlement deed for any child to be born to the second defendant after its execution. It

was pointed out by the learned Counsel for the appellant that practically there was no evidence on the side of the defendants in support of their

case of undue influence. But the question is whether in the circumstances of this case it was for them to establish that the settlement was vitiated by

undue influence.

Normally it would be for the person who pleads undue influence to establish the fact. But in this case, as contended by Sri T. M. Krishnaswami

Iyer, the circumstances in which the settlement deed was executed appear to be such as give rise to a presume of undue influence. In support of his

contention, the learned Counsel for respondents 1 to 3, relied on a number of authorities. But it is only necessary to notice a few of them.

Narayana Das Balakrishnadas v. Burchraj Chordia Sowcar 53 M. L. J. 842 was a case in which at the instance of his maternal uncle the nephew

executed a mortgage in favour of a third party. It was established in that case that the maternal uncle was constituted a trustee of the properties of

the nephew and while being in such a confidential relationship, he prevailed upon the nephew to execute a mortgage. It was also found that the

mortgagee was not unaware of the influence of the maternal uncle over his nephew. In those circumstances, Venkatasubba Rao, J. was of the view

that it was for the mortgagee to establish that the mortgage was a fair and independent transaction. In the course of his judgment, the learned Judge

referred to various English cases decided by the Court of Chancery and formulated the principle that,

where confidential relations exist those standing in such relations cannot entitle themselves to hold benefits unless they can show that the persons

who have conferred the benefits had competent and independent advice.

In Inche Noriah Binte Mohamed Tahir v. Shaik Allibin Omarbin Abdulla Bahashan 56 M.L.J. 349=29 L.W. 196 (P.C.), the Privy Council held

that where the relations between the donor and donee had at or shortly before the execution of the gift been such as to raise a presumption that the

donee had influence over the donor, the Court should set aside the voluntary gift, unless it was proved that in fact the gift was the spontaneous act

of the donor acting under circumstances which enabled him to exercise an independent will and which justified the Court in holding that the gift was

the result of a free exercise of the donor''s will. In that case the appellant before the Privy Council sued to set aside a deed of gift of substantially all

her properties executed by her in favour of the respondent, a nephew by marriage of the appellant. It was found that the appellant was wholly

illiterate and was a feeble old woman unable to leave the house, relying entirely upon the respondent for everything and leaving the management of

her affairs to him so that she had no knowledge of her own affairs. The circumstances showed that the appellant was totally and completely in the

respondent''s hands. The Privy Council was of the view that the relations between the appellant and the respondent were amply sufficient to raise

the presumption of the influence of the respondent over the appellant and to render it incumbent upon him to prove that the gift was the

spontaneous Act of the appellant acting under circumstances which enabled her to exercise an independent will and which justified the Court in

holding that the gift was the result of the free exercise of her will. The Privy Council referred to the decision in Allcard v. Skinner (1887) 36 Ch. D.

l45, l71, and quoted the following observations of Lord Justice Cotton us containing the principles which should govern such a case:

The question is : Does the case fall within the principles laid down by the decisions of the Court of Chancery in setting aside voluntary gifts

executed by parties who at the time were under such influence as, in the opinion of the Court, enabled the donor afterwards to set the gift aside?

These decisions may be divided into two classes : first, where the Court has been satisfied that the gift was the result of influence expressly used by

the donee for the purpose; secondly, where the relations between the donor and donee have at or shortly before the execution of the gift been such

as to raise a presumption that the donee had influence over the donor. In such a case the Court sets aside the voluntary gift, unless it is proved that

in fact the gift was the spontaneous act of the donor acting under circumstances which enabled him to exercise an independent will and which

justify the Court in holding that the gift was the result of a free exercise of the donor''s will. The first class of cases may be considered as depending

on the principle that no one shall be allowed to retain any benefit arising from his own fraud or wrongful act. In the second class of cases, the Court

interferes, not on the ground that any wrongful act has in fact been committed by the donee, but on the ground of public policy, and to prevent the

relations which existed between the parties and the influence arising therefrom being abused.

Tungabai Bharatar v. Yeshwant Dinkar (1944) 2 M.L.J. 350=57 L.W. 605 (P.C.), which was also a case decided by the Privy Council was

one in which a wife executed a mortgage in favour of a third party securing the debt of her husband. In dealing with the transaction, Lord Goddard

observed:

It would certainly not be true to say that there is a presumption in every case where a wife confers a benefit on her husband without consideration.

Equality it is not necessary in order to establish the presumption that the parties should stand in the same particular category of relationship to each

other.

The Noble Lord while dealing with the manner in which the High Court had approached the question said :

It is unnecessary to decide whether there was actual fraud by the husband; it is enough to show that the wife was acting under his influence and not

as a free agent.

Ram Pattar v. Lingappa Gounder 69 M.L.J. 104=41 L. W. 228 was also a case of undue influence in which too a third party was involved.

The learned Judges while repelling an argument to the contrary, held that the principles followed by the Courts of Equity of England in dealing with

similar transactions were equally applicable in this country. One other case that may be noticed is the recent one in M.A. Abdul Malick Saheb Vs.

T.P. Muhammad Yousuf Sahib and Others, It was there held that transactions in the nature of a bounty from a child to a parent were in equity

looked upon with caution by Courts and it was the duty of the donee to prove that the gift was the result of free exercise of independent will and

the Court should be satisfied that the donor was acting independently without any influence from the donee. It was there further pointed out that the

mere existence of the fiduciary relationship of parent and child between the donee and the donor raised a presumption of undue influence and it

was on the donee to rebut the presumption.

An examination of the above cases would show that they fall under three Classes: (1) where a donee by exercising undue influence gets a gift

executed in his favour; (2) where the donee being in a confidential relationship with the donor gets a benefit in the form of a gift from the donor

without the donee actually exercising any fraud or undue influence; and (3) where a document is executed in favour of a third party at the instance

of a person who is in a position to dominate the will of or in a confidential relationship with the executant. Narayana Doss Balakrishna Das v.

Buchraj Chordia Sowcar 53 M.L.J. 842, Tungabai Bharathar v. Yeshwant Dinkar (1944) 2 M.L.J. 350=57 L.W. 605 (P.C.) and Ram Pattar v.

Lingappa Gounder 69 M.L.J. 104 = 41 L.W. 228, were cases falling under the third class where a third party was involved which is not the

position here. The instant case will not fall under class (1) either, because there is no evidence in this case of the plaintiff herself having exercised

any undue influence over the first defendant. But it seems to me that this will come under the second class above mentioned, which corresponds

with the second class of cases noticed by Lord Justice Cotton in Allcard v. Skinner (1887) 36 Ch. D. 145, 171. Mohamed Tahir''s Case 56

M.L.J. 349=29 L.W. 196 (P.C.), was of this type, and so too Abdul Malick Sahib''s Case (1956) 2 M.L.J. 355.

In this case, the circumstances already mentioned clearly point to the fact that the first defendant was subject, to the control of the plaintiff. She

was completely in charge of the first defendant''s properties and in management thereof. She brought him up and got him married. There is no

evidence of the first defendant having at any time interfered with the plaintiff''s management. There is also evidence that the first defendant was

simply obeying the plaintiff. It seems to me that these circumstances raise a presumption that the settlement was not the result of the free will of the

first defendant.

The nature of the disposition also strengthens that conclusion. No transaction can be more improvident on the part of the first defendant than

the settlement in question. He denuded himself of all the properties and made little provision even for his own maintenance, in the event of the

second defendant predeceasing him. He gave more than the bulk of the properties to his sister and even the other properties covered by the

settlement were to go to her absolutely on the happening of a certain event. What is more strikingly strange than all these is the fact that, although

the first defendant must have known that the second daughter of his was then in the womb the settlement deed made no provision whatever for her.

One of the reasons for executing the settlement was the fear on the part of the first defendant that he would not get a male child at all by the second

defendant. This ex facie appears to me to be equally strange because as a fact the second defendant was enceinte at the time of the execution of

the settlement. In the light of these circumstances, therefore, I consider that it was entirely for the plaintiff to establish that the settlement deed was

executed by the first defendant of his own free will and with independent advice. Both the Courts below felt that all was not well with the settlement

deed. In the background of things, they thought that the settlement deed must have been obtained not with the free will and consent of the first

defendant. In any case, the Courts below were not satisfied that the plaintiff had established that the settlement was a fair transaction. Having

regard to all the facts and circumstances, I do not feel persuaded to disturb the conclusion of both the Courts below. The second appeal fails and

is dismissed with costs. No leave.