( 451 )
Present: De Sampayo and Dalton JJ.
THE ATTORNEY-GENERAL t>. DE CROOS et al1—D. C. (Inty.) Colombo, 11,341.
Crown Debtors Ordinance, No. 14 of 1843—Seizure of property subject tomortgage-.—Is libel w or “ information " referred to in section 3equivalent to w plaint"—Issue of warrant of sequestration—Should it be before the filing of such action t Intervention ofmortgagee—Right <of intervention.
Certain lands were mortgaged by the defendants as securityfor the payment of money due to Government on the purchaseof arrack rents. The defendants having committed default inpayment, the Crown sued them on February 22,1024, and
obtained decree on February 29, 1924. Thereafter, bn March 19,1924, and April 6, 1924, the Government Agent caused to beseized certain other properties of the 'judgment-debtors, as thesecurity covered by the bond was not considered sufficient tosatisfytheclaim. In effecting the seizuresthe Government
Agent purported to act under section 2 of Ordinance No. 14 of1843. In compliance with the further provisions ‘ of the Ordi-nance contained in section 3, certificates , were filed in Court andwarrants of sequestration were issued and executed on April 28, 1924,March 2, 1924, and May 5, 1924. At this stage of the proceedingsthe present respondent, as purchaser of the lands' seized onconveyances dated July 4, 1924, obtained in execution of mortgagedecrees of December 19 and 39, -1923,. entered in liis * favour, soughtto interveneand moved that the orders forsequestration be
vacatedandtheproperties sequestered be released from seizure,
on the ground that the seizure should ‘ have preceded the filingof the action.
Held,thattherespondent was not entitled tointervene in the
Per De Sampayo J.—That the proceedings were regular. The“ libel *’ mentioned in section 3 of the Ordinance of 1843 is merelythe formal complaint to the Court, and is not meant to be a plaint,The further proceedings contemplated in the section refer onlyto the warrant of sequestration, and not to any action supposedto be'instituted with the filing of the libel.
Per Curiam.—-An objection with regard to the status of a party-may be taken for the first time in appeal, subject to .an appropriateorder as to costs.s
PPEAL from an order of the District Judge of Colombo allow-ing the respondent to intervene and vacating the orders for
the issue of warrants of sequestration made under the circumstancesset out.
Attorney-General v,De Croos.
( 452 )
H. Elpkinetone, K.C., A.-G., and Ahbar, Jf.C., S.-G. (with.1/. W.' H. de StTva, C.C.), for the Crown, appellant.—TheOrdinance of 1843 gives the Government Agent authority to seizethe property of a Crown debtor on his knowledge bf the existence,of a debt. The section does, not limit the powers given in any way.The mere existence of an action against the debtor does not takeaw&y this right which exists for the protection of the., revenue.This provision is of similar effect, to the tacit hypothec underRoman-Dutch law for all moneys'due to Fiscus.v
Section 2 of the Ordinance gives the authority to seize, andsection 3 goes on to say that a libel or information should be hiedwithin seven days. The. libel or information is only required to statethe nature and amount of the debt. There is no provision requiringthe Crown to ask for judgment, thereby clearly indicating thatthe libel or information here referred to is not to be taken as aplaint. It is merely the formal notice or complaint to the Court.The short space of time, viz., 'seven days, makes it quite clear that itis not a plaint that is required, for in most cases it takes many daysmore than seven for the Crown or any party litigant to state Jiheirclaim.
It has been held that the provisions of the Civil Procedure Code,,chapter' XI/VII, apply to sequestrations under this Ordinance-There is, therefore, sufficient protection for the respondent undersection 660, if his contention that he is not affected by the proceedingsis good. He should, therefore, have never intervened in this action.
There is one objection, however, which entirely puts therespondent out of Court. He is only a mortgagee of the propertiesseized,' and has, therefore, no right to intervene in th6 presentaction between the Crown and its debtor. He has no locus standi.
[Dalton J.—Why was thi^ point not taken in the Court below ? ]
We are entitled to take this point which goes to the mot of thecase even here in appeal. It is purely a point of law, and may betaken at any time (Benaim' A Co. v. De Bono *); (Cole v. Govt. of theUnion of 8. A. 2).
Driebetg, K.C. (with him Samarawichreme), for the respondent.—Dealing with the question of the status of the respondent, it must beconceded that the point was not taken in the Court below, and mustbe deemed to have been waived. The appellants are not entitled totake the point now.
[Dalton J.—How did you come into Court ?]~
With an affidavit.
The sections of the Civil Procedure relating to sequestration beforejudgment cannot certainly apply in this case, as judgment wasentered in March, and the present- proceedings were tkken in Apriland May.
1 (1924) App. Coe. $14.* (1910) S. A. Law. Rep., App. JHv., 273.
( «8 )
* [De Sampayo J.—The learned' Attorney-General'tf argument 1198k
understood to be that it has been held-!that proceedings under ^Ordinance No. 14 of 1848 are to be conducted on the same basis as Attorney'section 658, and that it is* therefore, only a further point that Genc%f0£* ^section 660 applies.]
If the old Ordinances leading up to the present are followed up,it becomes apparent that the whole purport is to initiate proceedingsagainst the debtor. Under the old law all his property thenbecame liable to seizure, and the seizure of one property put aconstructive seizure on all the properties of the debtor. By thisOrdinance the scope is limited to the properties Actually seized.
The oldest Ordinance is the regulation No. 7 of 1809. Then comerules and orders of 1888. The next Ordinance is No. 2 of 1887,which was continued until 1842.
In No. 1 of 1848 the procedure in the previous regulations wasdropped out because the new rules under the Charter of 1688 werein force. That is the procedure that ought now to apply.
The words in section 8 “ the further proceedings thereon " referclearly to the action in view.
[Be Sampayo J.—The words refer to the sequestration to followand not to any further action.]
There is one only question: Did the sequestration issue rightly ?
The Crown has already instituted an action for its claim. It haya certain security, and it cannot now, sifter the institution of theaction, increase the value of the security by seizing other lands.
If after execution of the decree there is still a balance due, it canthen, like any other creditor, seize other available assets of thedebtor.
The further proceedings in section 3 clearly indicate that theOrdinance contemplates the filing of an action.
[De Sampayo J.—Why does the section not go on to say that onthe filing of the libel summons should issue and so forth ?]
Because it contemplates that the ordinary provisions of theCivil Procedure Code will apply.
With reference to the provision of the Code under which therespondent might come into Court, the application of the respondentmight well come under section 344.
[Elphinstone, K.C., A.-G. (in reply).—There is no provision in theCode by which the present respondent can justify his coming intothe present action. Even section 344 does not allow a person nota party to the action to come in and file a motion.]
This is no case to interpret one Ordinance by a prior one for tworeasons: First, there is no ambiguity; the words are clear and plain;secondly, the prior Ordinances were not the subject of construction,there is hardly any case-law interpreting them.
( 454 )
1995. With respect to the status of the respondent, it is clear law thatThe such an objection can be taken at any time. The fact that itAttorney- was not taken at the earliest opportunity may perhaps affect the
General v. dev
Croos question of costs.
May 28, 1925. De SampaYo J.—
In this case the question for decision is new and is not easy ofsolution. It depends upon the true construction of section 8 ofthe Crown Debtors Ordinance, No. 14 of 1843. The action is onebrought by the Attorney-General on two mortgage bonds, onwhich a sum of Rs. 110,280.27 was claimed from the defendantsas balance purchase money due to the Crown in respect of certainarrack rents purchased by the defendants. The action wasinstituted on February 22, 1924, and decree was entered on February29, 1924. It being apparently considered, as it in fact eventuallyproved, that the property mortgaged was insufficient to cover theamount of debt, the Government Agent, purporting to act undersection 2 of the Ordinance No. 14 of 1843, caused on March 19and April 8, 1924, respectively, two seizures to be made of certainother property of the defendants. After those seizures thecertificates contemplated by section 3 were filed in Court, andthe Court issued the necessary warrants of sequestration which appearto have been executed on April 28 and May 2 and 5, 1924.
Up to this point the proceedings were not questioned by anyparty. It appeal's, however, that the property seized was subjectto a mortgage in favour of the respondent on this appeal. Themortgage had been effected on July 29, 1922, and decrees hadbeen obtained thereon on December 19 and 80, 1923. The salesunder those decrees were carried out on May 2, 3, and 5, 1924.The respondent himself became purchaser and. obtained conveyanceon July 4, 1924. In this state of facts the respondent intervenedin this action on September 26, 1924, and moved that the ordersfor sequestration above referred to be vacated and the propertysequestered be released from seizure. The District Judge afterinquiry allowed the motion on the ground which will be presentlymentioned, but the Attorney-General at the outset of his argumentraised the question whether the respondent had any right to*intervene. Counsel for the respondent objected to this questionof status being raised, as no objection had been taken in the DistrictCourt or in the petition of appeal. But the question not being depen-dant on the ascertainment of any new facts, but being purelyone of law, I think that, the Attorney-General is within his rightsin raising this question and that we should consider and decide it.The respondent is not a party to the action, and there is no expressprovision of the law on which a person in his position can rely. Ifsections 658 and 659 of the Civil Procedure Code, relating toclaims to property sequestered before judgment in ordinary civil
( 455 )
actions, ave in any way applicable, the respondent can derive nohelp from them. In the first place, his motion does not amountto a claim, it only raises a question of procedure. Even if itwere a claim, it is clear from the above sections that a claim couldbe preferred only by a person who is or alleges himself to be ownerat the time of the sequestration, and from the respondent's ownstatement of facts we know that at the time of the sequestrationin this case thedefendants and not himselfwere theowners.The
respondent wasthen only mortgagee, andthere isno provision
anywhere enabling a mortgagee to make a claim.. Moreover,section 660 expressly conserves the rights,existingprior tothe
sequestration, of persons not parties to the action. Generalconsiderations likewise show that the respondent's interventionis uncalled for.If the sequestration wasjustifiedin law,the
respondent is not in a position to move to vacate the order, but ifit was not, the respondent’s remedy must be sought in some formof action against the Crown. On the question of status, I thinkwe must hold against the respondent.
The construction of the Crown Debtors Ordinance, No. 14 of1843, is a more difficult question. Section 2 authorizes the Govern-ment Agent, upon his own knowledge or notice to him of any debtdue to the Crown, to seize all and every property of the debtor toan amount sufficient to cover the debt, and section 3, which createsthe present difficulty, provides that within seven days after suchseizure—
4 4 A libel or information setting forth the nature and amount ofthe debt so due to Her Majesty shall be filed in any Courthaving jurisdiction in the case, and every such Court,upon any such libel or information being filed, togetherwith the certificate of the property seized, signed by theperson making the seizure, is hereby required to deliverto the Fiscal warrant to sequester the . property of thesaid debtor, and any further proceedings which may behad thereon shall be according to such general rules ofpractice as now are or hereafter may he framed by the Judgesof the Supreme Court."
In this case .the proctors for the Attorney-General (plaintiff) onMarch *24, 1924, filed, together with the certificate of the officer whomade the seizure, an 44 information ’’ in the following form:—
The infoimation of the plaintiff above namedstates- as
'* 1. The defendants ate indebted to His Majesty in the sum ofUs. 110,289.27, with interestthereon …. as shown
in the plaint filed in this action, being the balance purchaseprice of the privilege of selling arrack by retail ….
( 456 )
Attorney-General v. deCroat
“ 2. Certain property belonging to thefirst defendant hasbeen
seized finder section 2 of Ordinance No* 14 of 1843, and certi*ficate of seizure is herewith filed*
“ Therefore the plaintiff prays that the Court may be pleased toissuea warrant to theDeputy Fiscal of Negombounder
section 3 of the said Ordinance to sequester the said pro*perty of the first defendant/*
The “ information " with regard to the other seizure was insimilar form, and both “ informations ” were filed within the timelimited. It will be seen that the Attorney-General's action againstthe defendants on the two mortgage bonds was instituted, andeven decree obtained, before the filing of the information andbefore the issue of the warrant of sequestration. The intervenientrespondent raised the objection, which the District Judge upheld,that the issue of the warrant should have preceded the institutionof the action, that the libel or information referred to in section 3of the Ordinance was in fact to be the pleading which is nowgenerally called the plaint, .that the action so commenced shouldbe a preliminary to the sequestration, which in effect amounts toa sequestration before judgment in an ordinary civil action. Thisobjection was maintained before us in appeal and was soughtto be reinforced by reference to the earlier enactments providingfor the recovery of Crown debts. The earliest enactment wasBegulation No. 7 of 1809. It provided for the Collector (corres-ponding to the Government Agent) seizing property of the Crowndebtor, and filing in the Court of Bevenue or Provincial Magistratea certificate of the amount of the debt, and it required the Courtor Provincial Magistrate to issue a warrant of sequestration “ witha clause of citation to be inserted in such warrant setting forth thesaid demand and calling on the defendant to show cause whythe same should not be decreed against him and the sequesteredproperty sold in satisfaction thereof." There is no doubt thatunder this enactment the filing of the certificate of the Collectoris the commencement of the action and amounts to a " demand,"or as we may call it a prayer for relief, and that the warrant itselfcontains a summons to the defendant upon which a decree for thedebt may follow.
This regulation was repealed by the Ordinance No. 2 of 1887,which contained provisions similar to those of the regulation. Butafter providing for the warrant with a clause of citation, it added“ and such further proceedings shall then be had thereon as is nowor hereafter may be ordered by any general rule of practice ofthe Supreme Court relative to revenue cases." Under this Ordi-nance also the proceedings* are of the same nature as under theregulation. This Ordinance was in its turn repealed by theOrdinance No. 1 of 1848, which, as regards the provisions withwhich we are now concerned, is similar to the existing OrdinanceNo. 14 of 1848. An important change in the nature of the
( 457 )
proceedings is to be observed in both these latter Ordinances. Thewarrant of sequestration is no longer to include a clause of citation,nor is the defendant called upon to show cause why a decree shouldnot be entered against him for the amount of debt, nor is thecertificate of seizure constituted as the commencement of theaction. Was there a change of purpose in the Legislature ? Wasit intended to give to the Crown larger privileges for the purposeof recovering debts ? Was the Crown now enabled to seize andsequester the debtor's property at any time, whether before orafter the commencement of the action ? The Attorney-Generalcontends that this was the purpose and effect of the later legislation.The District Judge’s attention was concentrated * on the words“ libel or information," which the Crown is to file and afterwhich the warrant of sequestration is to issue. He construesthese words to mean what we now understand as the plaint in acivil action. The meaning of "libel" under our old procedureand of " information " is, of course, well known. But are thesewords used in their technical sense ? There is a good deal in theargument of the Attornev-General that all that was intendedwas to provide for a formal complaint which was to be the basisfor the exercise of the Court’s power to issue a warrant of seques-tration, and that the case against the Crown debtor was not necessarilyto commence with the filing of such a complaint. It isnoticeable that as distinguished from the provisions of the regu-lation No. 7 of 1809 and of the Ordinance No. 2 of 1837, section 3of the Ordinance No. 14 of 1843 contains nothing relating to thetrial of an action on the basis of the “ libel " or " information." Itmerely provides for the issue of a warrant of sequestration withoutany clause of citation. The section no doubt concludes with theprovision that “ auy further proceedings which may be had thereonshall be according to such general rules of practice as now are orhereafter may be framed by the Judges of the Supreme Court."This is vague, and would be a curious way of saying that the caseshall be proceeded with further as m an ordinary civil action.I am inclined to think the proceedings to be had *' thereon " referonly to the warrant of sequestration and not to any action supposedto be instituted by the filing of the libel or information. It appearsto me that the Ordinance No. 14 of 1843, section 3, contemplateduot-hing beyond the sequestration of property and any questionsarising therefrom.
I would allow the appeal, but without costs, and set aside the-order of the District Judge vacating the orders for the issue ofwarrants of sequestration.
An objection has been taken by the appellant that the petitioner(respondent) not being a party to the'proceedings, in which theorders for sequestration were made, has no locus standi, and cannot
General v. 4*Crooe
( 458 )
1925. he heard in the way lie has chosen to come. I do not propose toDalton J. detail the history of the proceedings in the action and sequestrations,
which has been fully set out in the judgment of my learned brother,
Attorney* hut it- seems that alter those proceedings the respondent filed aGmCrw>8 n10^011’ giv*nS notice thereof: to the plaintiff in the action (thepresent petitioner), and asking that the orders for sequestrationhe vacated, and the properties sequestered be released fromseizure.
Now. for the respondent to come into this action in that way,it seemed to me that he must have been acting, as I think he onlycould act, under some procedure laid down by the Courts Ordinanceor Civil Procedure Code or some other Ordinance. After argument1 think it was admitted that he had not so acted. He does not relyon any of the provisions of sections 050-661 of the Civil Pro-cedure Code, but we were referred to section ‘344 as possiblyjustifying his action. This section clearly does not apply* here.We were then told that he was a mortgagee, a mortgage decree holder,and had purchased the property in question. That may wellbe so, but 1 am quite unable to see how that entitles himin the absence of any specific authority laid down in rule or Ordi-nance undei' the circumstances set out in his affidavit to file amotion in an action to which he is no party as he has done here,nor can I see how the Court had any power to make the order hesought to obtain. Even if this motion can be said to have beenmade “ in the course of an action,** just as order LII of the Englishrules dealing with motions and other applications only applies tomotions and applications, which are allowed by the rules or byStatute, so the provisions of section 91 of the Civil ProcedureCode can only apply to motions authorized by some section inthe Code, or by an Ordinance or other authority. If his rights, havebeen infringed, as his counsel allows, he has ample remedywhich he can pursue in the proper way, but nothing I have heardduring the course of the argument satisfies me that he had authorityor power to act as he has done here.
It is argued, however, on his behalf that no such objection nshas been now raised was taken in the Court below, and as this ismerely a matter of' procedure this Court in its discretion shouldnot now give effect to the objection. If by the use of the words44 a matter ot procedure ** it was sought to be made but thatrespondent had a right to come to the Court on the proceedings thenbefore the Court, but had chosen the wrong procedure, then I thinkthere might have been sonic substance in the argument putforward. But respondent was no party to that action; nor hasany right that he might have' by law to intervene, or any authorityof the Court to deal with any such intervention, been brought toour notice. The powers of this Court on appeal are, I understandlaid down in section 778 of the Civil Procedure Code, and section 40
( 459 )
of the Courts Ordinance, 1889. Those powers appear to me to be 1985.as wide, if not wider than the powers set out in order LVIII,section 41, of the English frules which apply in England, and under —the circumstances here I consider reference may be had to Englishauthority. In the often cited case of Mayor of Norwich v. Norwich General v. deElectrio Tramways Co.,1 it is laid down that a point of this kind Growcan be taken at any time; no question of waiver by the appellantarises. (See also Civil Procedure Code in British India byWoodroffe and Ameer Ali, at p. 67.) The case of Appuhamy v.
Nona 5 does not apply here. The facts are entirely different. Itis a case in which a party in the suit wished on appeal to put for-ward a fresh ground, which had not been put forward when theissues were framed in the Court below.
The objection to the proceedings taken by respondent is, inmy opinion, a good one. and the trial Judge should have struckout his motion. This appeal should, in my opinion, be allowedon that ground, and it is not therefore necessary to consider thefurther questions raised.
In view of the fact that this Objection was not raised in the Courtbelow, I would make no order as to the costs of this appeal.
THE ATTORNEY-GENERAL v. DE CROOS et al