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Present: Lascelles C.J. and Wood Benton J.HASSEN HADJIAB t>. LEVANE MABIKAE.
57—D. C. Galle, 10,&47.
Civil Procedure Code, s. 547—Transfer of property without administra-tion—Transfer notinvalid—Is partitionaction. an action for
recovery of landt—Power of Courttogive plaintiff an opportunity
of obtaining administration after the institution of the action.
Section 547 of the Civil Procedure Code, while it penalizes, doesnot prohibit, the transfer of property which ought to have been,£Ut has not been, administered.
In an action for therecovery ofland a Court baa the rightto
allow the plaintiff anopportunityofobtaining administrationso
•as to get rid of the objection that the action was not maintainable.
Wood Benton J.—Jtmay fairlybeargued that the wordsin
section 547, “ no action Shall be maintainable," mean only " shallbe capable of being proceeded with."
Wood Benton J.—I do not understand the Privy Council in thecase of Ponnamma- v. Ammugam1 to have ' held that .every partitionaction is an action for the " recovery of property " within themeaning of section 547.
fJIHE facts are set out in the judgment of Wood Benton J.
H. A. Jayewardene, for the fourth defendant, appellant.—Thetransferring of a property by an heir without taking out adminis-tration is rendered an offence by section 547 of the Civil ProcedureCode. A contract is *void if prohibited by a statute, though thestatute inflicts a penalty only because such a penalty implies aprohibition. The deed of transfer is therefore void. [WoodBenton J.—Do not the words “ in the event of the property beingtransferred ” suggest the possibility of a valid transfer?] No. The^imposing of the penalty shows that Courts will not lend theirassistance to give effect to such transfers. [Wood Benton J.—Ifthe Legislature intended to render the deed void, it would have beenso simple for it to have said so.] The Courts will infer the intentionof the Legislature from the fact of the. penalty being imposed.
[Lascelles C.J.—You must look into the law to see if the act wasdeclared an offence merely for the purpose of protecting the revenue.Is not the penalty in this section imposed for the,purpose of protect-ing the revenue only?] The object of the section appears to bepartly for- protecting the revenue, and partly for preventing persons.from transferring bad titles.* But in any case the penalty renders
* (1906) B N. L. R. 92$.
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the deed void. Counsel cited Peris v. Fernando,1 * Mudianse v.Wilson,3 Krishnappa Ghetty v. Garpen Ghetty,3 * Victorian DaylesfordSyndicate, Ltd., v. Lott,* Cope v. Rowlands.*
The action is not maintainable. Section 547 expressly prohibitssuch an action as this unless letters of administration are takenout. The Court cannot now allow letters to be taken out andthen give the letters a retrospective effect. The rights of partiesto an action should be determined as at the date of the action.Silva v. NonaliamineA The objection that no letters had beenobtained is not a technical objection, but one of substance; apartition action is an action for the recovery of land. Ponnammav. Arvmugam.''
Bawa, K.G., for the plaintiff, respondent.—The penalty in section547 was clearly imposed for the protection of the revenue. Thesection further provides that the Crown may recover from thetransferor or transferee the stamp duty which would harve had’ to bepaid for the administration. This shows that- the transfer is valid.The penalty is not imposed for the protection of the public, as titlepasses to the heirs without any administration. Silva v. Silva[(1907) 10 N. L. R. 234.] Where the penalty is imposed merelyfor protecting. the revenue the contract is not void. See Melliss v.The Shirley and Fremantle Local Board of Health,8 KrishnappaGhetty v. Garpen Ghetty.3
The Court has often stayed proceedings and allowed adminis-tration to be taken out. See Gooneratne v. Hamine.3 The wordin the section is “ maintain ” and not “ institute.’’
H. A. Jayewardene, in reply.June 18, 1912. Lascelx.es C.J.—
Gur. adv. vvlt.
This is a partition action in which the plaintiff claimed, in additionto another share, with regard to which no question arises on thisappeal, one-sixth of certain house property in – Galle by virtue of aconveyance dated August 2, 1902, by which Natchia Umma andMohamed, who are stated to be respectively the widow and onlychild of one Abdul Asiz, purported to convey the interest of AbdulAsiz to the plaintiff. The appellant intervened, and by his answeraverred that the estate of Abdul Asiz was over Rs. 1,000 in value,and that the conveyance from his widow and child to the plaintiffwas invalid under section 547 of the Civil Procedure Code, asadministration had not been taken out. It was conceded that theestate of Abdul Asiz exceeded Rs. 1,000 in value. In the decision,from which'the appeal is taken, the learned District Judge held (1)
1 (1905) 1 Bal. 199.
(1909) 12 N. L. R. 134.
3(1912) 16 N. L. R. 243.
(1905) 2 Ch. 624.
® (1903) 7
3 (1836) 2 M. & W. 149.
« (1906) 10 N. L. R. 44; 1 A. C. R. 15.» (1905) 8 N. L. R. 223; 1 Bal. 166.
» (1885) 16 Q. B* D. 446.
. L. R. 299.
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that the plaintiff’s claim in this particular action was not an action“ for the recovery of land ” within the meaning of section 547 of theCivil Procedure Code, and (2) that in view of any doubt which mightexist as to the validity of the conveyance on which the plaintiffclaimed, the plaintiff should be allowed an opportunity of obtainingadministration.
In the appeal the legal questions involved were very fully discussed,but there are practically only two questions for decision, namely,(1) whether the effect of section 547 is to invalidate transfers ofproperty where administration has not been taken out, and (2)whether the learned District Judge was right in allowing the plaintiffan opportunity of obtaining administration so as to get rid of theobjection that the action was not maintainable.
With regard to the first question, it was contended that it must beinferred that the transfer was invalid from the fact that the sectiondeclares that the transferor and transferee, in a case where propertyis transferred without administration having been taken out, areguilty of an offence, and provides for their punishment. In arecent case, where an analogous question came before this Court(Krishnappa Chetty v. Carpen Chetty1), I cited the judgment of LordEsher in Mclliss v. The Shirley and Fremantle Local Board ofHealth2 as a clear and practical exposition of the principle ofconstruction which should be followed in such cases. Applyingthis test, it is clear that the principal and, as far as I can see,the only object of the penalty is the protection of the revenue.The heavy penalty which the section imposes (a fine which mayextend to Rs. 1,000) justifies the inference that the Legislatureconsidered that the punishment provided in the section wTould besufficient to enforce compliance with the law without the additionof a further penalty in the shape of the invalidation of the transfer,which in some cases would be a punishment of extreme severity.Then, there is the provision enabling the Crown to recover from thetransferor and transferee the amount of the stamp duty payable onadministration. This, I think, to some extent is an admission ofthe validity of the transfer; for if the transfer were invalid, whyshould the transferee, who would have no interest in the. estate, beheld responsible for administration duty?
Looking at the section as a whole, I am of opinion that the penal-ties imposed by the section are exhaustive, and that the Legislaturedeliberately refrained from invalidating the transfer. It is not forus to speculate on the reasons which determined the Legislature totake this course. But there are at least two circumstances whichcan hardly have escaped consideration. . The invalidation of thetransfer in these cases would be a punishment of extreme severity;in many cases, as where it was honestly believed the property wasunder Rs. 1,000, it would amount to grave injustice. But „thei (1912) 15 N. L. B. 843.* (1885) 16 Q. B. D. 446.
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punishment would be unfair in its incidence. It would penalize thetransferee; but as regards the transferor or his heirs, it would havethe effect of restoring the property to him or them. Further, theinvalidation of the transfer would lead to widespread confusion anduncertainty in the titles to landed property, for the cases in whichadministration is not taken out are very numerous indeed. Forthese reasons I am of opinion that it canpot be deduced from thelanguage of section 547 that the transfers penalized by the sectionare necessarily invalid.
The second point, namely, the question whether the Judge wasright in allowing the plaintiff the opportunity of obtaining adminis-tration, is covered by authority. In Gooneratne v. Hamine,1Layard C.J., in an action for declaration ot title, held that in theevent of the estate being proved to be of the value of Rs. 1,000,administration must be taken out before the plaintiff could beallowed to proceed with the action. This decision involves theconstruction that the words “ no action shall be maintainable ” arenot equivalent to “ no action shall be instituted, ” and disposes ofthe argument which has been addressed to us on the point. Wehave been invited to reconsider this decision. But from the factthat the judgment is binding on us I see no reason for doing so.The decision has been repeatedly followed, and is now settled law.
It is not necessary to consider whether this is an action for therecovery of land within the meaning of the section, as the questionat this stage is purely academic, and will not arise if the plaintiffmakes use of the opportunity given him by the District Judge ofobtaining administration. I would dismiss the appeal with costs.
Wood Renton J.—
The plaintiff-respondent sues in this action for a partition of theproperty described in the plaint, relying for his title on a deed oftransfer from the heirs of one Abdul Asiz dated August 2, 1902.The fourth defendant, the appellant, intervened, claiming a housestanding on the premises in question,; and objected that the respond-ent’s action was not maintainable, inasmuch as the estate of thepredecessor in title of the respondent’s vendor, Abdul Asiz, exceededRs. 1,000 in value and had not been administered. The learnedDistrict Judge held in effect that the action could still be maintained,and the deed of transfer set up, if' administration was taken out now,and he adjourned the trial for the purpose of enabling the respondentto obtain letters of administration. The present appeal is broughtagainst the order enabling the respondent to comply with therequirements of section 547 of the Civil Procedure Code. Therespondent’s counsel objected that It was not appealable, but weover-ruled this objection and heard Mr. Hector Jayewardene on theappellant’s behalf. Two points were urged in support of the appeal:
1 (1908) 7 N. L: R. 303.
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first, that the estate of Abdul Asiz not having been administered,the deed of transfer by the heirs in the respondent's favour wasinvalid; arid, in the next place, that in any event section 547 ofthe Civil Procedure Code expressly prohibited such an action as thepresent from being maintained. In my opinion both points are bad.Section 547 of the Code does not prohibit the transfer of propertywhich ought to have been, but has not been, administered. Itpenalizes such a transfer, but the language in which the penalty is-imposed as well as that of the section as a whole point, in my opinion,to the conclusion that the Legislature did not intend to do anythingmore than this. The words “ in the event of .any such property
being transferred every transferor and transferee of such’
property shall be guilty of an offence ” themselves indicate thepossibility of a legal transfer taking place. The subsequent provisionempowering the Crown to recover from “ such transferor or transferee'such a sum as would have been payable to defray the costs of thestamps necessary for letters of administration ” corroborate thisview. They seem to treat transfers of the character in question as-valid transactions, in respect of which stamp duty may properly berecovered. Mr. Jayewardene argued that the provision that thetransferor or transferee of property requiring administration, butunadministered, “ shall be guilty of an offence/’ showed’ an intention*’on the part of the Legislature to make the transfer itself illegal.But these words are common form in enactments of this description,and do not of themselves justify the inference which Mr. Jayewardenesought to draw from them. There is no need to repeat what wehave recently said in Krisknappa Ghetty v. Garpen Chetty 1 as to thelaw applicable to the question with which we are here concerned. Inaddition to. the authorities there cited, I would* refer to the case ofVictorian Daylesford Syndicate,'Ltd., v. Dott2 In my opinion section547, while it penalizes, * does not prohibit the transfer of propertywhich ought to have been, but has not been, administered. Suchan enactment at the time when. the Code of Civil Procedure passedwould have unsettled the titles to very numerous properties, andI think that the Legislature must be taken to have deliberatelyabstained from declaring the law in this sense.
With regard to Mr. Jayewardene’s seqond point, I think that it-may fairly be argued that the words in section 547 of the CivilProcedure Code, “ no action shall be maintainable,” mean only44 shall be capable of being proceeded with.” This view of the lawhas the implied sanction of the decision of Layard C.J. and WendtJ. in Gooneratne v. Hamine,9 where the point was taken in theappellant's argument, and where both the learned Judges held thatwhile section 547 of the Code is imperative, it was open to the Courtto give the party suing an opportunity of taking out the necessary
i (1912} 15 N. L. R. 24$.2 (1905) 2 Ch. 624:.
* U903) 7 N. L. R:. 299..
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administration. That decision has, to my knowledge, been repeatedlyfollowed in the Courts of Ceylon, and I think that the rule whichit sanctions is an extremely salutary one. The primary object ofsection 547 is to protect the revenue. That object is obviouslysecured by the refusal of the Courts to allow an action for therecovery of property liable to administration, but not administered,to proceed until a grant of administration has been obtained. Weought not to place upon section 547 an interpretation which itslanguage does not compel us to adopt, and which, as in the presentcase, can only, serve to support purely technical objections. Itappears to me, moreover, that the present action is not one for the“ recovery ” of property within the meaning of section 547. I donot understand the Privy Council in the case of Ponnamma v.Arumugam1 to have held that every partition action comes withinthe scope of these words. On the contrary, the Privy Councilpointed out in that case that the action was one for partition onlyin form; that a considerable portion of the property had alreadybeen dealt with by the. heirs and alienated, and that consequentlyit was in reality an action for “ the recovery ” of property. Thepresent appeal possesses no merits, and I am very glad that I havebeen able to come to the conclusion that it ought to be dismissedwith costs.
HASSEN HADJIAR v. LEVANE MARIKAR