Sant Lal Singh and Others vs Nanku Lal Singh and Another

Das, J.—I think that this appeal must succeed. There is no dispute that the Plaintiff No. 1 and the Defendant No. 1 mortgaged their respective properties to one Ali Hossain to secure a loan of Rs. 400 granted by him to them. It is quite true that as between the Plaintiff No. 1 and Defendant No. 1 there was an arrangement by which Plaintiff No. 1 took Rs. 200 and the Defendant No. 1 took Rs. 200; but their liability to Ali Hossain was joint and several and it was open to Ali Hossain to proceed against any of the properties mortgaged to him.

That being the position, Ali Hossain brought a mortgage suit to enforce his mortgage against the Plaintiff and Defendant No. 5, He got his decree in due course and caused the properties belonging to the Plaintiff to be sold in execution of the decree. It appears that there was a prior mortgage affecting the property belonging to the Defendants and that the property belonging to the Defendants had already been sold in the suit brought by the prior mortgagee to which Ali Hossain was a party. The Plaintiffs now claim that, as their properties have answered for the claim of Ali Hossain, they are entitled to claim contribution from the Defendants to the extent of that portion of the mortgage money which was appropriated by the Defendants. I can see no answer to the claim put forward on behalf of the Plaintiffs.

The view of the learned Judge in the Court below appears to be this; that as the puisne mortgagee was cited in the action against the Defendant, it was the duty of Ali Hossain to redeem the mortgage, and, as he failed to do so it must be taken, that he consented to the integrity of the mortgage being broken up. That being so, it was open to the Plaintiff to claim partial redemption on payment of the proportionate share of the debt due by him. The Plaintiffs, not being bound by law to satisfy the entire decree obtained by Ali Hossain, cannot claim any contribution from the Defendants.

As far as I know, there is no authority in support of this view. All the properties mortgaged to Ali Hossain remained liable for the entire debt due to Ali Hossain, and there is nothing in Section 82 of the Transfer of Property Act which compelled the mortgagee to proceed against the properties belonging to the Plaintiffs for the share of the debt proportionate to the value of those properties. He was entitled to proceed against those properties for the entire debt due to him, unless indeed he had, by his own act, destroyed the integrity of the mortgage, and I know of no authority which lays down that the failure to redeem a prior mortgage that may exist in respect of any of the properties, operates as a splitting up of the mortgage security. Though he was entitled to redeem the prior mortgage, he was not bound, to do so, and it was for him to decide whether having regard to the value of the other properties included in his mortgage, he should take the risk. The result is that he lost portion of his security, not because he released, it, but because there was an assertion of a title paramount against him.

The case of Wajahat Hussain v. Ratan Lal [1911] 8 A.L.J. 1092 to which the learned Vakil for the Respondents referred is an entirely different case. That was a case where A and B hypothecating their respective properties to C by a single mortgage deed, left in the hands of C part of the consideration for the redemption of a prior mortgage held over a portion of B''s property by D. It was found that C did not redeem D although it was Ms clear duty to do so. It was held, in these circumstances that the integrity of the mortgage in favour of C was broken up and that it was open to A to redeem his portion of the mortgaged property upon payment of a proportionate amount of the mortgage money. But in the case before us, the mortgagors did not leave any fund in the hands of Ali Hossain and it was, as I have said before, no part of the duty of Ali Hossain to redeem the prior mortgagee. That being so, it was open to Ali Hossain to proceed against the properties which belonged exclusively to the Plaintiff. He did proceed against those properties with the result that the Plaintiffs have been compelled to discharge an obligation which rested, not only on their property but also on the properties of the Defendants and on the Defendants personally. I know of no principle which allows the Defendants to escape from the liability just because they had the foresight to give in mortgage a property which they had already mortgaged to a third person.

The learned Judge was much pressed by the terms of Section 82 of the Transfer of Property Act, but in truth, Section 82 has nothing whatever to do with the case. That Section deals with, the burden that may be lawfully placed on each of the several properties mortgaged, to secure one debt, it does not touch the question of personal liability that always arises when one person is compelled to pay the debt of another. The learned Judge thought that there was no persona decree against the Defendants; that is true enough; but it is entirely irrelevant to consider that matter. The personal liability was always there, and would in due course have given rise to a decree, but for the fact that the property belonging to the Plaintiff was sufficient to pay off Ali Hossain. The question is free from all complications and in my opinion was correctly decided by the learned Munsif.

I would allow the appeal, set aside the judgment of the Court below and restore the judgment and decree passed by the Court of first instance. The Plaintiffs are entitled to their costs throughout.

Macphereon, J.

I agree.