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SAMI APPU v. DISANAYAKE.
G. B: Matara, 1,553.
Purchase of land—Mortgage duly registered—Decree thereon—Sale in execution.—Purchase under such decree—Subsequent purchase under originalmortgagor, subject to his mortgage—Prior registration of such deed ofpurchase—Validity of title.
B mortgaged his interest in a land to A by deed dated May, 1896, andregistered it in June, 1896. A obtained a mortgage decree on 19thMarch, 1900, and at the Fiscal's sale held on 9th November, 1900, hebecame pnrchaser of B’s share of the land, which was conveyed to himon 22nd April, 1901. The deed' was registered on 18th May, 1901.C obtained a money decree against B and sold in execution on 22ndFebruary, 1900, B’s land subject to A's mortgage. At the Fiscal's saleheld on 22nd February, 1900, D purchased it. His deed, dated 26thSeptember, 1900, was registered on 1st October, 1900.
Held, that D's purchase, having been made – pending the mortgagesuit of A, was null and void as against the decree in that suit, and couldobtain no force or validity as against it by prior registration.
N .this partition suit, before the decree was entered the fifth,sixth, seventh, and eighth defendants intervened. According
to the original defendants, the land sought to be partitioned wasowned by three families in equal shares. The sixth, seventh,
June SOand July .3.
1902.June 20and July 3.
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and eighth added defendants came in saying that the owners ofthe iftTwj wore only one of the three families mentioned by theoriginal defendants. The District Judge, Mr. W. E. Thorpe,found in favour of the contention of the original defendants, asregards this issue and the second issue whether one Balahamy,the mother of the plaintiff, and the fourth defendant was or wasnot a daughter of Wattu and sister of Dingihami. The third issuewas between the third defendant and the fifth added defendant.Both claimed one Balappu’s share. The third defendant allegedit was one-twelfth, and the fifth defendant alleged it to be muchmore. Upon this issue the District Judge gave judgment asfollows:—
" The important point is, Who is entitled to this share? Whatthe share is I will go into later on. The point is an instance ofthe evergreen controversy as to whether the purchaser, under awrit issued under a mortgage decree obtained on a duly registeredmortgage bond, has a prior title over a subsequent purchaser fromor against the original mortgagor, whose conveyance has beenregistered before that of the purchaser under the mortgage decree.
“ I think it is impossible to reconcile the decisions on the point,but tin spite of that I see no difficulty in deciding such cases inaccordance with common sense and justice.
“ In this case the fifth defendant was the mortgagee, and in courseof time put his bond in suit. A proper mortgage decree wasentered, and in due process of law a Fiscal’s conveyance wasobtained and registered. But meanwhile the third defendant badbought this same land under a writ issued in pursuance of a simplemoney decree entered against the mortgagor, and obtained aFiscal's conveyance and registered it before the conveyance reliedupon by fifth defendant. There was no unreasonable delay on thepart of the fifth defendant after he had once got his judgment indoing all that the law required him to do. The Registration Ordi-nance • gives priority of course to the document first registered.But, to get over the manifest injustice this rule inflexibly appliedwould frequently work and the door it would open to fraud, thedoctrine has been evolved that the Fiscal’s conveyance finallyobtained under the registered mortgage relates back to the date ofthe registered mortgage. The matter is not complicated by anyconsideration of whether the decree is a mortgage decree or not, asit is admitted that the fifth defendant’s decree is a proper mortgagedecree.
“ On behalf of the third defendant, it is contended that there isno such rule at all—anyhow that the mortgage decree was notregistered.
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“ As to the first contention, I think that the doctrine does exist,that it must exist, and that it is a most salutary rule.
" Mr. Justice Withers, in a judgment often referred to, has laiddown that the mortgagee has no title to the land, but has theprivilege of selling the land under his decree. If the mortgageecan sell, it is evident that the purchaser must be able to hold theland against subsequent purchasers from or against the mortgagor,otherwise the whole system of mortgages would be an utter farce.I do not say that cases may not arise when the rule Diligentibusnon dormientibus, &c., would apply. If, for instance, the mort-gage decree-holder delayed greatly to make use of it and get theFiscal’s transfer, it would apply; but. as remarked before, there hasbeen nothing of the sort here.
“ Now, as to the second contention that the mortgage decree wasnot registered: if the mortgage had never been put in suit, therewould be no question that the third defendant’s purchase wouldhave been subject to the mortgage in favour of the fifth defendant.What then? Does the fifth defendant, by putting it in suit, lose thebenefit of the registered mortgage? This sounds ridiculous, butthis is what the third defendant contends. I refuse to believethat the law can be so absurd.
June tOand July 3.
” I allot Balappu’s share, therefore, to fifth defendant ”.
The District Judge dismissed the seventh defendant’s claim, andallowed the eighth defendant one-thirty-sixth share.
The third defendant appealed. His appeal came on for hearingon the 20th June, 1902.
Van Langenberg, for third defendant, appellant.
Sampayo, for fifth defendant, respondent.
The arguments in appeal and authorities cited appear in thejudgment of Wendt, J.
Gut. adv. vult.
3rd July, 1902. Wendt, J.—
This is a partition action, and the question raised on the appealis an instance of what the Commissioner aptly styles “ the ever-green controversy ” between the purchaser of land in executionunder a duly registered mortgage and another purchaser whobought subsequently to the mortgage and subject to it, butregistered his conveyance before the registration of the conveyancein favour of the. purchaser under the mortgage. The question ishere raised in a contest between the third and fifth, defendants asto which of them is entitled to the interest which one Balappuadmittedly had in the laud which is the subject of partition.
1902.June 20and July 3.
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Balappu mortgaged his interest to the fifth defendant by a deeddated May, 1896t registered in June, 1896.' On 21st February,1900, fifth defendant commenced an action against Balappu torealize his mortgage, and on the 19th March, 1900, obtained amortgage decree, in execution of which the Fiscal, on 9th Novem-ber, 1900, sold the land to the fifth defendant as the highest bidder,and duly conveyed the land to him on 22nd A.pril, 1901. Thisconveyance was registered on 18th May, 1901.
The third defendant’s title is derived as follows.—On lltbNovember, 1899, a money decree was passed against Balappu atthe instance of an unsecured creditor, in execution of which, on22nd February, 1900, the Fiscal sold the land to the third defend-ant, who obtained his conveyance on 26th September, 1900, andregistered it on 1st October following.
Under these circumstances, it was argued, for the third de-fendant, that the competition was between his conveyance and themortgage decree, in which the fifth defendant’s mortgage had beenmerged, and that that decree not being registered was void asagainst his subsequent conveyance which was duly registered, andthe case of the Government Agent v. Hendriclthamy (3 C. L. B. 86)was relied upon. I think, however, that in view of the decisionsof this Court in D. G., Galle, 6,041 (I Browne, Ap-pendix B, p. xi.),and D. G., Batticaloa, 2,072 (Civil Minutes, 16th August, 1901), thatcase is on longer an authority on this point. Mr. Van Langenbergnext relied upon the case of Madar Lebbe v. Nagamma (2 Browne,322, 6 N. L. R. 21) decided by Chief Justice Bonser and myself. Thatwas an action brought by the holder of a decree .passed in anaction upon a duly registered mortgage, to have the land declaredliable to sale under that decree, in spite of the claim of a personwho had bought the mortgaged land subsequently to the mortgage,in execution of a money decree against the mortgagor. Theclaimant’s conveyance was dated subsequent to the decree, butwas registered in September, 1899, whereas the decree was notregistered until the following month of October. This Court heldthat, from the frame and scope of the action plaintiff had to relysolely on his decree, to which defendant was not a party, and thatdecree being void • for want of registration, and defendant beingadmittedly the owner of the land, though subject to the mortgage,it could not possibly be considered that the defendant’s resistanceto the sale of his land under that decree was wrongful.
. The present case has reached a later stage. The mortgage decreehas been executed, and the purchaser has obtained a conveyance,which he has duly registered, subsequently, it is true, to thirddefendant’s conveyance, but that necessarily followed from the
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respective dates of the two conveyances. The fifth * defendant’s 1902.action on his mortgage was rightly constituted, because the third
defendant did not acquire an interest in the land until the day
after the action was commenced, and he was not, therefore, Wkhdt, j.entitled to be made a party to that action. He is bound by thedecree in it, although he was not a party to that decree. It is awell-established principle that the alienation, pendente tite, of theinterest of one of the parties to an action-will not be allowed toprejudice the rights of the other party. The action, in fact, is toproceed, and the decree in it to operate, as if the interest alienatedwas "till the property of the original owner. 'This principle isenunciated in the well-known English case of Bellamy v. Sabine(26 L. J. Chancery, 707; 1 de &. & /. 578). Lord Cranworth’sdicta in that case are quoted by Mr. Justice Clarence in the caseof De Leney v. Periee (8 S. C. C. 94), and I need not repeat them here.
Applying that principle to the present case, the third defendant’spurchase, having been made pending the fifth defendant’s mort-gage action, is null and void as against the decree in that action, andcould obtain no force or validity as against it by prior registration.
It may be that the plaintiff in the case of Mddar Lebbe v.
Nagamma might, upon the facts of that case, have relied uponthis ground to defeat the defendant’s claim, but the principle ofBellamy v. Sabine was not put forward at the argument, as I havesatisfied myself by consulting my notes of the proceedings.
The appeal is dimissed.
SAMI APPU v. DISANAYAKE