026-NLR-NLR-V-14-ALWIS-v.-FERNANDO-et-al.pdf
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Feb. 13,1911
Present: Hutchinson C.J. and Middleton J.
ALWIS v. FERNANDO et at.
341—D. C. Colombo, 30,220.
Mortgage.—Subsequent acquisition of title by mortgagor—Conveyance bymortgagor to another after acquisition of title—Subsequent granteeacquires a title unfettered by mortgage.
A mortgaged a land to B in 1898 when he had no title to theland. In 1902 A acquired title to the land. In 1903 C boughtthe land from A for valuable consideration in good faith andwithout notice of the mortgage bond.
Held, (1) that C acquired'title to the land unfettered by themortgage to B ; (2) that C was not A’s “ representative,” and wasnot estopped by any representation which A made from denyingthat A had any title at the date of the mortgage bond.
Under the Romari-Dutch Law a mortgage of immovable propertyby a person who at the date of the mortgage is not the owner doesnot become valid when ho subsequently acquires ownership (jusagainst a bona fide purchaser from the mortgagor after he hudacquired title).
A
PPEAL from a judgment of the Acting District Judge, Colombo(Allan Drieberg, Esq.); The facts are set out in the judgment.
Vernon Grenier (with him H. A. Jayewardene), for plaintiff,appellant.—The case relied on by the District Judge (Don Carolisr. Jamis') does not apply, for this is the case of a mortgage andnot of a sale. The Roman-Dutch Law is clear that in certaincircumstances a mortgage of another’s property is valid (Voet20, 3, 4, 7). Ordinance No. 7 of *1840 only specifies the mode inwhich mortgages may be created, and we have satisfied its provisionson this point. [Hutchinson C.J. referred counsel to the judgmentof Grenier J. in 385—C. R, Galle, January 6, 1911.]
1 (1909) 1 Cur. L, B. 224.
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Savundranayagam (with him Jayatileke), for respondents.—Under Feb. 13^1911the Roman-Dutch Law it is only in the case of general mortgages, Aiwiev.including future property, that property which did not belong to Fernandothe mortgagor at the date of the mortgage would, on the mortgagorsubsequently acquiring title, become bound by the mortgage. InCeylon general mortgages are no longer in force ; the principle ofthe Roman-Dutch Law would not apply now. Berwick’s Voet>pp. 280, 359. Counsel cited Don Carolis v. Janus,' Guruhamy v.
Subaseris,2 Kadiravelupulle v. Pinna?
Grenier, in reply, cited Censura Forensis, IV., 7, 18.
Cur. adv. wit.
February 13, 1911. Hutchinson C.J.—
The plaintiff sues on two mortgage bonds granted by DomingaFernando to David de Alwis in 1898 and 1899 ; he sues as theexecutor of the mortgagee. The defendants claim the land under atransfer from Dominga Fernando made in 1903. At the date of themortgages Dominga Fernando had no title to the land ; it wasvested in the Crown, which gave a Crown grant to her in 1902.
The District Judge has found, and the evidence supports the finding,that the defendants when they obtained their transfer in 1903 hadno notice of the mortgages, and were no parties to the fraud, ifany, committed by the mortgagor, Dominga Fernando. He gavejudgment for the plaintiff against the first defendant, who is thelegal representative of Dominga Fernando, for the amount of themortgage debt, but-refused to grant a hypothecary decree ; and theplaintiff appeals and claims a hypothecary decree.
At the date of the mortgages, and until the date of the Crowngrant to Dominga, the dominium was vested in the Crown free fromthe mortgages. The Crown grant transferred that title to Dominga,and she transferred it to the defendants, who acquired it for valuableconsideration, and in good faith, and without notice of the mortgagebonds. They are not her “ representatives,” and are not estoppedby any representation which she made from denying that she hadany title at the date of the mortgage bonds.
Mr. Grenier, for the appellant, contended that under the Roman-Dutch Law a mortgage for immovable property by a person who atthe date of the mortgage is not the owner, becomes valid (not merelyas against him, but also as against a bona fide purchaser from himwithout notice of the mortgage) when he subsequently acquiresthe ownership. In my opinion the passages from Voet (bk. 20,tit. 3, s. 6) and from Nathan (2, 1004) which are quoted in thejudgment of Grenier J. in S. C. 385—C. R. Galle, 6,074 (14 N. L. R.
65), expressly negative this contention* 1 think that the appealshould be dismissed with costs.
'{1909) 1 Cur. L. R. 224.- {1010) 13 A L. R. 112 ; 2 Cur. L. R. 15$.
* {1389) 9 S. C. C. 36.
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ffeb. 13.1911 Middleton J.—
Alwis v. The plaintiff in this case as executor of David de Alwis, deceased,ern 0 sued the defendant, Maria Fernando, personally and as legalrepresentative of the estate of Dominga Fernando on two mortgagebonds dated respectively September 7, 1898, and August 25, 1899,executed by Dominga Fernando in favour of David de Alwis. Thedefendant pleaded that by a Crown grant dated April 14, 1902,Dominga Fernando bought certain land on December 24, 1903,sold the same to the defendant and one Helena Fernando, and thatif the land so sold were identical with the land mortgaged by DomingaFernando to David de Alwis, then she had no right so to mortgagethe same. The plaintiff replied that the said land was identical,and alleged that the deed executed by Dominga Fernando in favourof Helena Fernando was fraudulent, collusive, and without con-sideration, with a full knowledge of the existence of the mortgage,and pleaded that Dominga Fernando and her privies in title wereestopped from denying the validity of the said mortgage. OnJune 24, 1910, Helena Fernando, whose proper name appeared tobe Selistina Fernando, was added as defendant. Upon the trial itwas admitted by both sides that the land mortgaged was the landconveyed by the Crown grant to Dominga Fernando on April 14,1902, and by her conveyed to the two defendants. After hearingcertain evidence the District Judge gave judgment for the amountclaimed on the mortgage bonds against the defendant as legalrepresentative of the deceased Dominga Fernando, but on theauthority of Don Carolis v. Jamisx declined to grant an hypothecarydecree, holding that the. right of the mortgagee was dependent onthe title of the mortgagor, and as the mortgagor had no title whenthe mortgages were executed, the land was not bound and executable.On the question of want of consideration for and fraud in transferto the defendants, the learned Judge held that although the conductof Dominga Fernando amounted to a fraud on the mortgagee, theevidence did not-establish that the defendants gave no considerationto her for the transfer, or were parties to her fraud. The plaintiffappealed, and relied on a judgment of my brother Grenier’s S. C. M.of January 6,1911, in 385—C. R. Galle, 6,074, and on passages to befound in Berwick’s Voet at pages 348 and 352, and argued that Ordi-nanceNo.7of 1840 did not alter the Roman-Dutch Law as regards theconstitution of a mortgage. The defendants’ counsel relied on DonCarolis v. Jamis, ubi supra, and cited Kadiravelupulle v. Pinna2 andAbdul Coder Marikar v. Fernando,3 and argued that Grenier J’s judg-ment only applied to a case of competition between two mortgages.Now the point decided in Don Carolis v. Jamis, ubi supra, as theChief Justice pointed out in C. R. Galle, 6,074, was that a transferof immovable property by a man who has no title does not transfer
1 {1909) 1 Cur. L. R. 224.- (ISM) 9 C. C. 36.
*(1909) 4 Bat. 128.
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a title. In the present case Dominga Fernando had no title whenshe mortgaged in 1898 and 1899, but got a title in 1902 before shesold to Lhe defendants in 1903. The mortgages in 1898 and 1899were special mortgages, executed in conformity with OrdinanceNo. 7 of 1840. They have each, moreover, a general clause purport-ing to bind all the other properties whatsoever of the mortgagorDominga Fernando. That clause does not, however, bind futureproperty, even if Ordinance No. 8 of 1871, section 1, did not apply.Under the Roman-Dutch Law a mortgage is a charge on the propertymortgaged, and the fact that a charge on immovable property hasto be perfected by a notarial deed under the Ceylon Statute Lawdoes not, in my opinion, alter the nature of it. Dominium, however,or title in immovable property; has to be conveyed by notarial deed,and does not pass till the deed is duly executed. In the judgmentof Grenier J. in C. R. Galle, 6,074, ubi supra, the case of Maynardv. Gilmer's Trustees1 is referred to. In that case it was held, thata writ attaching immovable property to which the debtor had ajus ad rent while the dominium was in another was invalid to attachthe jus incorporate or jus ad rem, which was all that was vested in thedebtor, and that a subsequent transfer to the debtor’s insolvencytrustee did not cure the defect, or make the charge valid as againsta bond creditor of the debtor. The objection appeared to befounded on the fact that when the attachment was made by thesheriff the property did not legally belong to the insolvent.
Voet's opinion as expressed in bk, 20, 3, 6, translated by Berwick,p. 367, which was relied on by the Attorney-General in thatcase in support of the successful objection, is that if a person hasspecially mortgaged immovables as his own and afterwards legallyacquired their ownership (as in the case of a sale of land in Ceylonwithout a notarial transfer)—the words in brackets are my own—the property is only bound so far as future property has been alsoincluded in a clause of general hypothec. Here there is no clauseof general hypothec binding any jus ad rein, but only the presentproperty of the debtor.-• Ordinance No. 8 of 1871, section 1,abolishes’, however, general conventional mortgages. This being so,and the property mortgaged not having legally vested in Domingawhen she executed the mortgages, it would pass to a bona fide legaltransferee for value unfettered by mortgages.' As regards Domingaherself, I think the mortgages would be a charge on the ground ofestoppel. On the ground of want of consideration and fraud itwas not seriously contended that the learned Judge’s ruling waswrong, and I think, therefore, that the appeal must be dismissedwith costs.
♦
Appeal dismissed.
Feb. 13,1911
Midi>i.ktok
J.
Aluns v.Fernando
12-
1 3 Menzies' Report* {Cape) 116,