V.P. Periakaruppan vs P. Mayalagan and Another

M. Anantanarayanan, C.J.—Both these revision proceedings involve only one short ground, in two suits on a negotiable instrument, all the

pleas upon which the executants resisted the decrees of the suits have been negatived on the merits. But, in each of these two suits, the same

plaintiff sues under an assignment in his favour, constituting him as an agent for collection, even on a minimal interpretation. It is claimed that the

principal was alive, at least when one of the two suits was filed, and the learned counsel for the revision petitioner claims that the principal was alive

on the date of institution of both the suits.

However that might be, the principal died shortly thereafter. The suits have been dismissed, though they were otherwise entirely justified on the

merits of the findings, on the short point that the agency for collection having come to an end with the death of the principal, the suits were no

longer maintainable.

In my view, this is a quite erroneous conception of the respective legal rights of the parties. So long as there is an endorsement of assignment in

favour of the plaintiff in each case, the plaintiff can claim to be a holder in due course, ex facie. It is not in dispute that the suit is perfectly

maintainable, if it is instituted when the principal was alive, as is actually claimed. The decision relied upon by learned Counsel for the respondent in

Subrarnanian Chetty v. Alagappa Chetty, (1907) 17 MLJ 414, a judgment of Benson and Wallis, JJ., does not at all help to advance the

contention that, with the death of the principal, the suits themselves are extinguished. All that this decision states is that, as between the endorser

and the endorsee, the endorsement for collection simpliciter does not pass the property in the bill to the endorsee. Again when the suit was validly

instituted on the date when it was instituted, I am quite unable to see how it can be dismissed because of a subsequent event, such as the death of

the principal, which does not affect the substance of the claim.

In my view, the true equity in favour of the executant of any such instrument, where the principal happens to the pendente lite, is that he (the

executants )should be protected against a possible double jeopardy, namely, a further claim on the bill or instrument by the heirs of the deceased

principal. This can be very simply avoided, by the Court calling on the plaintiff to implead the legal representatives of the deceased principal as

parties to the action, so that the matter can be adjudicated upon in their presence. That is all the more essential in the present case, as Mr.

Balakrishnan, for the plaintiff, contends that this is not a bare agency for collection at all, but an agency coupled with an interest in the agent in the

proceeds of the bill, acknowledged by the principal.

I accordingly allow the revision, set aside the dismissals of the two suits, and direct that they be restored to file and disposed of in the light of the

observations that I have made. I may add that there is a decision of the Lower Burma Chief Court -- Ramzan Ali v. Vellaswami, 1910 8 Ind Cas

967 for the view that, with the death of the principal, the authority of the endorsee for collection does not end, the promissory note being

negotiable, and that he is a holder under the law to whom payment has to be made. Of course, if there is any claim available to the defendants

which is not already res judicata, concerning the actual liability, the defendants may be at liberty to agitate that claim. After the legal representatives

are brought on record, it will be for them to state whether the decree should be in the joint names of both the plaintiff and themselves, or they will

be satisfied with decrees of these suits in the name of the plaintiff. Remitted accordingly. No costs.