005-SLLR-SLLR-2000-V-2-APPUHMAY-AND-ANOTHER-v.-MENIKE-AND-OTHERS.pdf

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Appuhamy and Another v. Menike and Ot hers
tU. 1)e Z. Cunawardena, J.)
47
(The evidence shows that Madurawathi is the step-sisterand that Gunawardane referred to in the above excerpt of theevidence, was the step-father of Somawathi)
The import of the above excerpt from the evidence of the]st defendant-appellant himself is significant for it reveals inno uncertain terms that the 1st defendant-appellant hadcultivated the land in no other capacity than as a usufructuarymortgagee from the date or time he took an assignment of theinterest of a usufructuary mortgage upto the date that thebond creating the interest of a usufructuary mortgage wasdischarged on a date necessarily subsequent to 18. 08. 1966,for it was on that date that the aforesaid Somawathitransferred her l/4th share of the soil, to Hendrick whodischarged the usufructuary mortgage bond after he acquiredtitle to that 1 /4lh share. It would be seen that, according to theexcerpt from the evidence of the Is' defendant-respondent-reproduced above, a share of the produce had been given toMadurawathi. There was no need to give a share of the produceto Madurawathi unless the usufructuary mortgage had beenacted upon and unless the possession of both the 1sl defendantand Madurawathi had been on the basis of usufructuaiymortgagees. It is to be remembered that assignment of theusufructuaiy mortgage bond by deed No. 33290 dated 03. 12.1950 was in favor of both the lsl defendant-appellant andMadurawathi and it is well to remind oneself that it is the rightof a usufructuary to take the fruits of the property as the ownerbut not to fundamentally alter its character. There is noevidence even remotely suggesting that Madurawathi was atenant cultivator or that she had any proprietary interestother than the interest of a usufructuary mortgagee, whichusufructuary mortgage or interest Madurawathi obtained,along with the 1st defendant-appellant, on the assignment ofthe usufructuary mortgage from Degoaratchilage Appuhamy.

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lt is also to be observed that the 2nd defendant-appellant(who had filed a joint answer with the 1st defendant) alsoclaiming to be the tenant-cultivator, under Somawathi(original owner of 1 /4th share) who sold to Hendirik, had both,(i.e. the 1st and 2nd defendants-appellants) stated, in the courseof their evidence at the trial, that Madurawathi got a share ofthe produce of the land after the assignment of the Mortgagein favour of Madurawathi and 1st defendant which evidence ofthe Is* and 2nd defendants-appellants is confirmed by that ofSomawathi. To auote from Somawathi’s evidence.
According to the evidence, Madurawathi was a step- sister ofSomawathi. Somawathi, who had been called, (be it noted asa witness in support of the case of the 1st and 2"d defendants-appellants) had also stated (at pages 275-276 of thebrieO thatshe took a share of the produce of the land before she gave theusufructuary mortgage and that the usufructuary mortgagewas given to Degoaratchilage Appuhamy who, it will berecalled, assigned the mortgage to the lsl defendant-appellantand Madurawathi. Somawathi had also admitted in herevidence (page 276 of the brief) that after she gave theusufructuary mortgage of her share in the land-she ceased tocollect or was not paid or given any share of the produce of theland. If 1st defendant or both the Is' and 2nd defendantscultivated the land as the tenant cultivators even after the lsldefendant-appellant took on 08. 12. 1950 an assignment ofthe usufructuary mortgage bond that was given by Somawathioriginally to Degoaratchilage Appuhamy, that is, on 25. 2.1948 – then Somawathi should have continued to collect ashare of the produce byway of rent. The facts referred to aboveviz. the admission by Somawathi that Somawathi did notreceive a share of the produce by way of rent after she gave ausufructuary mortgage of her 1 /4th share had come to light inthe course of Somawathi’s own evidence. To cite the relevant
page 277 Somawathie had stated as follows:
(page 276 of the brief). Then at

CA
Appuhamy and Another u. Menike and Others
(U. De Z. Ganawardcna, J.)
49
had stated in the above excerpt of her evidence that she tooka share of the produce, by way of rent, only before she gave ausufructuary mortgage, which carries with it the necessaryimplication that she had not taken or received a sharethereafter.
Somawathi had thus admitted that she did not get anyshar e of the produce of the land after she gave a usufructuaryMortgage of her rights in the land. She had given theusufructuary mortgage to Degoaratchilage Appuhamy in theyear- 1948. Usufructuary mortgage was redeemed by Hendrickto whom Somawathi had sold on deed No. 6415 dated 18. 8.1966 her 1 /4th share. It is clear on the evidence of Somawathiherself that she never got any produce (by way of rent) from theIs1 defendant, or for that matter from anyone else, after shegave a usufructuary mortgage and the relevant piece ofevidence to that effect had been quoted above verbatim. Thatis quite understandable on the basis that DegoaratchilageAppuhamy who initially took the usufructuary mortgage, andthe 1sl defendant-appellant and Madurawathi- (the latter twobeing the assignees to whom Degoaratchilage Appuhamyassigned the usufructuary mortgage) had all cultivated theland not as tenant-cultivators under Somawathi but asusufructuary mortgagees in respect of the share of Somawathi.The evidence in this case had been elicited in a sort of ham-handed, amateurish way and one can only get a foggy view ofthings. The 2nd defendant-appellant also had statedthat Madurawathi i.e. the co-assignee (along with the Is'defendant-appellant) of the usufructuary mortgage took 1 /2share of the produce and that Appuhamy (lsl defendant) tookthe balance 1/2. To quote the relevant excerpt from the
evidence of the 2nd defendant-aDDellant.
(page 323 of the brief). (The person referred
to as Appuhamy in the above excerpt of the evidence is the 1st
exceruts from her evidence:
Somawathi

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defendant-appellant) Thus the evidence of the 2nd defendant-appellant was to the effect that 1 /2 share of the produce wastaken by Appuhamy i.e. the 181 defendant-appellant in the year1965 and that balance 1 /2 of Madurawathi was taken away byKeertiratna. This evidence of the 2nd defendant-appellant issignificant in three directions. It nails down the 181 defendant-appellant to the position that he (the lsl defendant) was nevera tenant-cultivator in relation to this land in respect ofSomawathi's share whilst at the same time, that piece ofevidence shows that the 1st defendant-appellant had acted orcultivated the land upon the assignment of the usufructuarymortgage to himself and Madurawathi and that possession ofthe 1st defendant-appellant in particular, and that ofMadurawathi, who was the co-assignee, was rooted inthat assignment of the usufructuary mortgage that the 181defendant-appellant and Madurawathi had taken fromDegoaratchilage Appuhamy who in turn had taken theusufructuary mortgage, as stated above, from Somawathi-theowner of 1/4 shar e. The said piece of evidence (of the 2,,ddefendant-appellant) also serves as final proof of the fact or asan admission by the 2nd defendant-appellant himself that hewas not a tenant-cultivator in respect of the share of theSomawathi or for that matter of anyone else.
To expand on the three points condensed above: The Is1defendant-appellant also had stated in his evidence (page 421of the brief) that after he took (as explained above) anassignment of the usufructuary mortgage of the 1 /4 share ofthe land that belonged to Somawathi, he (the Is1 defendant-appellant) took only l/2share of the produce of that 1 /4share
of the land. To quote:
Further, the 1st defendant-appellant, too, as the 2"d
defendant-appellant also had done, admitted that the balancehalf-share of the produce, of the relevant 1 /4 share of the landwas taken by the co-assignee, viz. Madurawathi. To quote
from the 1st defendant-appellant’s evidence:

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Appuhamy and Another u. Menike and Others,
(U. De Z. Cimawardena, J.)
51
Thus, evidence of both the 1st and 2nd defendants -appellants and that of Somawathi (who was called to supportthecaseofthe lsland2,lddefendants-appellants) all unerringlypoint to the fact that the possession of the 1st defendant-appellant was on the basis of his rights as a usufructuarymortgagee and not as a tenant-cultivator. That is why he the(1st defendant-appellant) admittedly took only 1/2 share ofthe produce of the 1/4 share of the land of which Somawathiwas originally the owner. That is why 1 /2 share of the produce(of 1 /4share of the land) was admittedly taken by Madurawathi-the co-assignee, along with the 1st defendant, of theusufructuary mortgage. If the Is' defendant-appellant hadworked as a tenant-cultivator under Somawathi, he would nothave shared the produce with the co-assignee of theusufructuary mortgage viz. Madurawathi. If, after taking theusufructuary mortgage too, the lsl defendant-appellant hadcultivated the 1 /4 share of Somawathi as her tenant-cultivator- then the Is1 defendant-appellant would have con-tinued to make payment of rent to her i.e. to Somawathi. In theexcerpt of her evidence reproduced at page 12 of this judgmentSomawathi had stated that after she gave a usufructuaiymortgage of her 1 /4 share of the soil she never got a share ofthe produce of the land. The evidence of the defendant-appellant himself (an excerpt from whose evidence isreproduced above at page 13 hereof) shows that he (the 2nddefendant-appellant) too was not a tenant cultivator-on the 2nddefendant’s own showing. Because as stated by himself (thatis. by the 2nd defendant) (In the excerpt above quoted), as hadbeen stressed above, the evidence of the 2nd defendant-appellant too was that (after the 1“ defendant-appellant tookthe assignment of the usufructuaiy mortgage along withMadurawathi) the produce was shared equally as between -the 1st defendant-appellant and Madurawathi only -1 /2 shareof the produce being taken by the Is1 defendant – the balance1 /2 share of the produce being taken by Madurawathi, which

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evidence corresponded exactly with that of the 1st defendant-appellant with whom the 2nd defendant-appellant had filed ajoint answer. So, that, on his (2nd defendant’s) own evidencpand on the evidence adduced by the 1st and 2nd defendants-appellants, as a whole, he (the 2nd defendant-appellant) hadnot got, nor had he even expected to get a share of the produceof the land, which wouldn’t have been the case, if he i.e. the 2nddefendant-appellant, too, had been a tenant-cultivator, whichwas the basis on which issue No. 07 had been raised on behalfof the 1st and 2nd defendants-appellants at the trial of. theaction. The fact that the two assignees of the usufructuarymortgage had divided the produce equally between them canbe explained only on the basis that both of them treatedor conducted themselves as usufructuary mortgagees whopossessed the land as such, recognizing no, landlord. Theevidence of the 1st and 2nd defendant-appellants to the effectthat the 1st defendant-appellant and Madurawathi shared asbetween themselves the produce of the land, (in the proportionof 1 /2 share each, confirmed or borne out, as it was by theevidence of Somawathi, who stated, as pointed out at page 12hereof, that she received no produce by way of rent after shegave a usufructuary mortgage of her share) rules out anyrent being paid to a landlord. And the fact that there wasadmittedly no such payment serves to show, the non-existenceof any landlord-tenant relationship between the 1st defendant-appellant and Somawathi in respect of whose 1 /4 share the1st and 2nd defendant-appellants claimed to be the tenant-cultivators.
. Although the doctrine of estoppel by deed, in its technicalsense, cannot be said to be part of our law, yet, the fact thatthe 1st defendant-appellant had taken a usufructuarymortgage could, at least, be treated, for certain, as an admis-sion by him (the 1st defendant) that he cultivated Somawathi’s1 /4 share in that capacity i.e. as a usufructuary mortgagee, atleast, from the date he took the mortgage on 08. 12. 1950, tillitwas discharged by Hendirick after he purchased Somawathi's1 /4 share. In fact, as pointed out above, even in the course ofhis oral evidence, the 1st defendant-appellant had admitted
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Appuhamy and Another v. Menike and Others
(U. De Z. Cunawardena, J.)
53
not only that he took an assignment of a usufructuarymortgage in respect Somawathi’s 1/4 soil share but also thatafter doing so – 1/2 share of the produce in respect of thatshare, was given to. Madurawathi-the co-assignee of theusufructuary mortgage. It is also worth observing that the 1stdefendant-appellant himself had got his name entered, in thecultivation committee register, as the owner of this land inquestion in respect of the year 1965 whilst the name of the 2nddefendant-appellant appears (in the said register) as thetenant cultivator, remarkably enough, under the 1stdefendant-appellant himself, for that year. What is significantis that the 1st defendant-himself had been directlyinstrumental in getting this data or information inserted in theregister, as had been revealed in his (1st defendant’s) ownevidence which was as follows:

If, as admitted above by 1st defendant-appellant, he got hisown name entered as the owner (not as tenant-cultivator) ofthe land in question in respect of the year 1965 and also gotthe 2nd defendant’s name entered, as the tenant-cultivator (notunder Somawathi) but under himself, that is, under the1st defendant-appellant himself, that must necessarily bebecause neither of them was a tenant-cultivator in respect ofSomawathi’s share of which the owners, as at present, arethe 1st-7th plaintiffs-appellants and the 3rd-4th defendants-respondents. Perhaps, the 1st defendant-appellant wasconscious of the legal position that a usufructuary mortgageewas included in the definition of “owner cultivator” and wastreated as such under the Paddy Lands Act No. 01 of 1958, andthat more than explains why he (the 1st defendant-appellant)thought it best to get himself registered as the owner as, in fact,he had done. This fact also unerringly points to the fact thatthe 1st defendant-appellant cultivated this land as ausufructuary-mortgagee.
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Even assuming for the sake of argument that the 1stdefendant-appellant had worked as a tenant-cultivator underSomawathi-he that is, the 1st defendant-appellant, cannot, inany event, be held to have done so. after, the assignment ofthe usufructuary mortgage in favour of the ls< defendant-appellant or rather taking over by him of the interest of theusufructuary mortgage in respect of Somawathi's share. Uponthe taking over of the interest of usufructuary mortgage, thetenancy rights (if any) of the lsl defendant-appellant hadsuffered extinction through "surrender" or more preciselythrough both “surrender” and "merger" in conjunction-thesurrender, so to say, coming in aid of merger-in the factualmatrix of this case. Ordinarily, in the generality of cases, amortgage operates as a conveyance of the legal title to themortgagee, but such title is subject to defeasance on paymentof the debt or performance of the duty by the mortgagor. Aspointed out above, at page 9 hereof the 1st defendant-appellanthad explicitly admitted, that he took from DegoaratchilageAppuhamy a usufructuary mortgage, or rather an assignmentthereof, in respect of Somawathi’s share. The effect of anassignment (novation) is that the lessor and assignee or themortgagor and the assignee stand to each other in the samerelation, as did the original mortgagor and mortgagee, so faras the rights and obligations affecting the property areconcerned. It would seem that the question, whether a validassignment or novation of a lease or mortgage could be madewithout the consent of the lessor or the mortgagor respectively,is somewhat unsettled. In fact, that point does not call forconsideration here for it is the lessor or the mortgagor, if at all,who has the right to complain if the lease or mortgage had beenassigned without his consent. Yet, it may be pointed out, inpassing, that the tenor of Somawathi's evidence does not evenremotely suggest that the assignment of, the usufructuarymortgage in favour of the 1st defendant and Madurawathi waswithout her (Somawathie’s) knowledge and consent.Somawathie had not said so. It is very revealing, in thiscontext, that when Somawathi sold her 1 /4 share on deedNo. 6415-dated 18. 08. 1966 to Hendrick, the vendee i.e. the
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Appuhamy and Another u. Menike and Others
(U. De Z. Gunawardena. J.)
55
said Hendrick had paid (as evidenced by the terms of the saiddeed of transfer No. 6415) only Rs. 600/= although the agreedconsideration was Rs. 1500/= for Rs. 1,000/= had beenretained by the vendee (Hendrick) to pay off Rs. 1,000/=due and owing to the usufructuary mortgagees viz. the 1stdefendant and Madurawathi who had taken, as stated abovean assignment of the usufructuary mortgage on deed No.33290-dated 7. 12. 50 (There is confusion in the marking givento deeds at the trial so that they have to be referred to by theirnumber) The fact that Somawathi had agreed to permit thesaid Hendrick to retain Rs. 1,000/ = which amounted to 2/3 ofthe consideration was another pointer although not decisive tothe fact that the assignment of the usufructuary mortgage tothe 1st defendant-appellant and Madurawathi was with theconcurrence of Somawathi. This amount i.e. Rs. 1,000/= wasretained by Hendrick to discharge the usufructuary mortgagein favour of the defendant-appellant and Madurawathi. If theassignment of the usufructuary mortgage in favour of the lsldefendant and Madurawathi was contrary to the wishes ofSomawathi, it was unlikely that she would have agreed topermit Hendrick to retain Rs. 1,000 to be paid to the lBtdefendant and Madurawathi in discharge of the usufructuarymortgagee. To set out the explanation of this, rather, elusiveconcept viz. surrender as given in a Standard Work.
“Any acts which are equivalent to an agreement on thepart of the tenant to abandon and on the part of thelandlord to resume possession of the demised premisesamount to a “surrender by operation of law", the rule maybe said to be that a Surrender is created by operation oflaw, when parties to a lease do some act so inconsistentwith the subsisting relation of landlord and tenant asto imply that they have both agreed to consider theSurrender as made."
However, it has to be emphasized that surrender differsfrom abandonment inasmuch as the latter is simply an act onthe part of lessee alone, whereas Surrender is a contractual actand occurs only though consent of both parties or rather in
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consequence of a consensual act of both reflected in aconsensual act. It is well settled that to show a surrender, amutual agreement between lessor and lessee that the lease isterminated must be clearly proved.
Assuming as was sought or attempted to show by the Is1defendant-appellant that he was the tenant cultivator inrespect of the 1/4 share that originally belonged to Somawathi,even at the date that he took the assignment of a usufructuarymortgage from Degoaratchilage Appuhamy (which is a claimlacking in honesty and conscience) there was a clear surrenderon the part of the 1st defendant-appellant of the rights oftenancy to Somawathi consequent upon the lsl defendant-appellant taking over the usufructuary mortgage upon anassignment from Degoaratchilage Appuhamy who had, in thefirst instance, taken a usufructuary mortgage from Somawathithe owner of 1 /4 share of the soil. It is to be observed that theevidence in the case is overwhelming that the assignment ofthe usufructuary mortgage in favour of the Is' defendant-appellant and Madurawathi was with the consent of Somawathi.At least, it is more probable than not-there being nothing tosuggest the contrary. Once an assignment is taken the lessoror the mortgagor on the one hand and the assignee on theother, stand to each other as did original mortgagor and theoriginal usufructuary mortgagee, so far as the rights andobligations were concerned. The effect of the assignment,which is tantamount to a novation, of the usufructuarymortgage was that the two assignees, viz. the lsl defendant-appellant and Madurawathi were substituted for the originalusufructuary mortgagee viz. Degoaratchilage Appuhamy, whocompletely dropped out. Degoaratchilage Appuhamy, theoriginal usufructuary mortgage lost all his rights and wasrelieved of all obligations under the usufructuary mortgage-the two assignees taking his place and becoming the newusufructuary mortgagees but under the terms and conditionsof the original usufructuary mortgage. Surrender takes placeas, has been explained above, when "parties to the contractof tenancy do some act which is so inconsistent with thesubsisting relation of landlord and tenant.”
CA
Appuhamy and Another u. Menike and Others
(U. De Z. Gunawardena, J.)
57
When the 1st defendant-appellant took an assignment ofthe usufructuary mortgage on bond No. 33290 dated2. 12. 1950, assuming that he was a tenant-cultivator till thatdate, the entire basis of his possession underwent atransformation. One cannot possess as the tenant-cultivatorand concurrently possess as a usufructuary mortgagee.A cardinal feature or a signal quality of any tenancy is theobligation of payment of rent by the tenant. Usufructuarymortgage arises when property is mortgaged with a pactumantichresis (antichresios) that is, with a pact or condition whichallows the mortgagee to use and take the fruits of themortgaged property in lieu of interest due on the mortgage.Usufructuary mortgage means an agreement whereby thedebtor gives to the creditor the income from the propertymortgaged (by the former) in lieu of the interest on his debt;whereas the tenant cultivator, upon renting land, possesses itby paying for it, usually in part of the crop or its equivalent inmoney. Usufructuary mortgage and a tenancy cannot co-existand if, in fact, the tenancy rights continued to exist, they i.e.those rights of tenancy could have continued to exist only if thecontract of tenancy also continued, and the usufructuarymortgage would not have been valid or constituted, if thetenancy had not lapsed by surrender or cession. Granting ortaking of a usufructuary mortgage is so utterly inconsistentwith the relation of landlord and tenant as to necessarily implythat both the former landlord and tenant (assuming there hadbeen such a relationship) had agreed to consider the surrenderas made.
The assignment (novation) of the usufructuary mortgage,which must be held to be proved, on the facts stated above, andto have been given with the consent of Somawathi, also worksor brings about a merger at the same time as it effects asurrender. In fact, the facts of this case, are such that one maysay that surrender had come or worked in aid of merger. Theconcept of merger is not a rigid one and seems to be, so tospeak, elastic and adaptable. In Grootchwaing Salt Works Vs.Van Tonder!u juridicial foundation of the principle of mergerwas explained by Innes C.J. thus “. . . concurrence of two
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qualities or capacities in the same person which mutuallydestroy one another". For example, if the tenant acquires titleto the leased premises, that is. if he becomes the owner, thecontract of tenancy would be wiped out. Another example ofmerger would be where the qualities of debtor and creditorbecome united in the same person or individual leading to aconfusion (equivalent of confusio in Roman Law) therebycausing an extinguishment of both qualities, for a personcannot be his own creditor or debtor. What is deducible frbmthese examples is that two irreconcilable capacities or rightscannot reside in the same person. Needless to say, the rightof a usufructuary cannot be integrated with that of a tenant.In the case of property interests, it is a general principal of lawthat where a greater estate and less coincide and meet in oneand the same person, the less is immediately annihilated or,in the phrase of the law, merged, that is “sunk or drowned inthe greater". For instance, when lessee purchases theproperty, the lesser interest of the lessee merges into thegreater interest of the owner. When the tenant becomes theowner of the leased premises ownership survives although thetenancy and landlordship both disappear or suffer extinction.Similarly, when the tenant acquires the rights of a usufructuarymortgagee his rights as a usufructuary mortgagee survivesalthough obligation on the part of the tenant-cultivator andthe right of the landlord to collect or receive the rent are bothextinguished. The extinction of the duties and rights under thecontract of tenancy in consequence of the inception of theusufructuary mortgage brings out or shows clearly theincompatible nature of the rights and duties under a contractof tenancy and a usufructuary mortgage. The concurrence, inthe 1st defendant-appellant, of the two opposing capacities oftenant-cultivator and usufructuary mortgagee renders itimpossible for the obligations and rights to continue under thecontract of tenancy-assuming, of course, that there had beensuch a contract earlier.
Neither the question of surrender nor that of merger hadbeen either raised or considered in the District Court which
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Appuhamy and Another v. Menike and Others
(U. De Z. Gunawardena, J.j
59
had been quite oblivious of those aspects, quiteunderstandably, as no issues had been raised with regard tothose concepts. In the written submissions filed in the Courtof Appeal, the argument of merger (but not surrender) hadbeen raised lackadaisically, for it has not been explained as tohow merger works or comes into play in the factual set up ofthis case. The facts of this case more strongly prove asurrender than a merger although, as stated above, the self-same act on the part of the 1st defendant-appellant in takingan assignment of a usufructuary mortgage operates at thesame time to cause, respectively, a surrender and merger-although the surrender must, perhaps, technically speaking,precede (in the circumstances of this case) the merger, in theorder in which they occur. As explained above, if the tenancyrights had continued and had not been surrendered, if not ofvolition, at least, by operation of law, valid inception of ausufructuary mortgage would have been made impossible forthe two rights are mutually inconsistent and destructive andcannot exist side by side. It is well to remind oneself, as hadbeen stated above, that surrender arises or occurs byoperation of law “when parties to a lease do some act soinconsistent with the subsisting relation of landlord andtenant as to imply that they have both agreed to consider thesurrender as made”. (Vide page 1295-Black’s Law Dictionaiy-5th Edition). At the same page, therein it had been explainedthat implied surrender takes place even when the lessee takesa new lease of the same lands. Wille has explained the positionthus: Such relocation is not continuation of the old leasebut a new lease formed by a fresh (tacit) agreement of theparties which succeeds to the previous lease”. As lnnesC. J. said in Bowhay Vs. WarcL,2> ‘Tacit relocation depends onthe fact that both parties adopt and continue the positionwhich the termination of the lease found them …. in otherwords, that the lessor is content that the lessee should remain,and the lessee is content to remain".
What I am seeking to explain is this, that is, that if takinga new lease involves or is preceded by a surrender of the old
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lease, as had been explained above, even when the nature ofthe legal relation in both leases is identical, the taking of ausufructuary mortgage by the lessee or tenant, whichaltogether metamorphoses the legal relation and which bringsabout an extinction (as explained above) of the contract oftenancy must, of necessity, involve a surrender of the tenancy,more so, as the two legal relations respectively of tenancy andusufructuary mortgagee, to repeat what has been emphasizedabove, cannot co-exist. Lee in his treatise, “Introduction toRoman Dutch Law”, had pointed out that in the case of ausufruct one of the ways in which it (usufruct) is determinedor terminated is by merger that is when the usufructuarybecomes the owner of the property or usufruct reverts to theowner by cession or surrender or even abandonment. In thelater situation, merger takes place in consequence of thesurrender or cession of the usufruct (by the usufructuary) tothe owner. So that it is the act of surrender or cession inconsequence of taking a usufructuary mortgage that results inthe merger. I have given the above example of surrender of ausufruct to the owner, consequently, resulting in a merger, byway of illustrating a general rule that the self-same act canresult in both surrender and merger simultaneously.
But in the light of the facts of this case it is the self-sameact-the act being the taking of the usufructuary mortgage bythe lessee (assuming that the 1st defendant was in fact, atenant-cultivator) that operates to result in a surrender andmerger simultaneously. There are no distinct or separate acts-separated in point of time. For instance, if the tenant hadceded or surrendered his tenancy rights first, and after thelapse of some time taken a usufructuary mortgage-then itcouldn’t have been said that the taking of a usufructuarymortgage had worked to produce the dual result of a surrenderand merger contemporaneously. So that there is justificationfor holding that the 1st defendant-appellant’s tenancy rightshad been extinguished not by surrender alone but by mergeras well-both events necessarily occurring at the same time-because it is one and the same act that produces both results.
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Appuhamy and Another v. Menike and Others
(U. De Z. Gunawardena, J.)
61
The learned counsel for the 1st and 2nd defendants-appellants, resourceful as ever, contended that, in any event,the tenancy rights of the 1st defendant-appellant ought to beheld to be in suspense or in a state of temporary cessation,during the currency of the usufructuary mortgage and to haverevived once the usufructuary mortgage was discharged. Ihave made a reasoned finding that the l8t defendant-appellanthad never cultivated the land in question in the capacity of atenant-cultivator for, to repeat what had been stated above, hecould not have commenced possession of this land, as atenant-cultivator, in the year 1963 for at that time, theusufructuary mortgage was in force-the 1st defendant-appellant having taken an assignment of the mortgage in theyear 1950. It has to be pointed out, even at the risk ofrepetition, that issue No. 07 had been raised, on behalf of thelBt and 2nd defendants-appellants, on the factual basis that the1st defendant-appellant started cultivating as a tenant-cultivator from the year 1963. When a right is suspended itsexistence is preserved although it cannot be presently assertedin the Courts. A right which is in suspense is susceptible ofbeing revived which is not the case where it is extinguished ashad happened in this case through surrender. Suspensionwhich is partial extinguishment for a time, when the right isdormant or is in abeyance, stands in contrast to completeextinguishment or extinction where the right is absolutelydead. Abandoned right or a surrendered right cannot be saidto be in suspense. The surrender was not conditional. It is awell known principle of law that a merger occurs whenqualities of creditor and debtor or when two incompatiblerights become united in the same person. There arises aconfusion (merger) of rights which extinguishes both qualities.It would appear that a right that had suffered extinguishmentthrough surrender or merger cannot be revived unless therewas an agreement to that effect. For instance in the case ofCape Times Ltd. Vs. Goldsmid0), it was held that a surety whobecomes the creditor in respect of the debt for which he stoodsurety discharges his own obligation. A surety's obligationwhich had been discharged in that way cannot be revived by
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cession of the principal obligation to a third party-unless thesurety expressly or tacitly agrees to that effect. This serves toshow that extinction of obligations brought about throughmerger or surrender is not suspensive but, so to speak,permanent. In this context, it would be instructive to refer tothe case of Foster Vs. Robinson141, where the statutory tenancywas held to have been surrendered by operation of law as it hadbeen verbally agreed, in that case, between the defendant'sfather and the landlord that the defendant’s father owing to hisage and infirmity need not pay any further rent but couldcontinue to live in the cottage for the rest of his life, rent free.Earlier the defendant’s father had worked for the landlord onthe farm and paid an annual rent to the landlord who was theowner of both the farm and the cottage. Thereafter, rent wasneither demanded nor tendered and defendant’s fathercontinued to live in the cottage without any payment of renttill he died. It was held that the agreement between thedefendant’s father and the landlord was effectual to producea surrender of the tenancy by operation of law and thedefendant was estopped from asserting that the old tenancystill existed.
Some other cases may be referred which are enlightening.In Metcalfe Vs. Boycel5>, the facts were: In 1910 the defendant,who was a county Police Constable became a quarterly tenantof a house. Later, that is, in 1912, the county Police authoritywhich had till then made a grant in aid of the rent of housesoccupied by Police Constables, decided that for the future theChief Constable should be the tenant of those houses and thatConstables should occupy them as servants and that the ChiefConstable should pay all rent, rates and taxes and that adeduction should be made in respect thereof from the men’spay. The defendant knew of, and made no demur to, this newarrangement. No demands for rates and taxes were made fromthe defendant. This course ofbusiness continued for 14years,the defendant continuing to occupy the house and his nameremaining in the books as tenant. There was no written,surrender or assignment of the tenancy either. Yet, on theabove facts it was held that there was evidence from which the
CA
Appuhamy and Another v. Menike and Others
(U. De Z. Gunawardena, J.)
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inference of fact could be drawn that in 1912 the defendanthad agreed with the landlord he would surrender his tenancyand that the landlord had further agreed to accept the ChiefConstable as his tenantand that the defendant would infutureoccupy the house as a servant of the Chief Constable and notas a tenant and that on those facts there had been a surrenderof the tenancy by operation of law and further that thedefendant was in the circumstances estopped from denyingthat he had surrendered or assigned the tenancy.
It is to be observed that, in the above case, although, inconsequence of the new arrangement, the Chief Constable wasconstituted the Landlord’s tenant-he thereafter beingresponsible for paying rent-the actual occupation continuedas before, in the Policeman. That there was no formalsurrender by the Policeman calls for remark. It was held that,notwithstanding the continuity of occupation, there had beena surrender by act and operation of law-the defendant i.e. thePoliceman, having ceased to occupy as tenant and begun tooccupy as servant of his master viz. the Chief Constable.
In deciding the above case Salter, J. had largely followedPeter Vs. Kendal101, where it was pointed out that it is notessential to a valid surrender by operation of law that thereshould be a physical change of occupation; it is sufficient ifthere is a change in the nature of the occupation. In Peter Vs.Kendal/supra) the owner of a ferry demised it to a person byparol at a certain annual rent. That person, at the end of a fewweeks, finding it unprofitable, proposed to become the servantof the owner as a boatman and to account to him for all moneyreceived from passengers, upon being allowed fixed dailywages. This was assented to by owner of the ferry and theperson who originally took the ferry on rent, became hisservant and received stipulated wages. Those being the facts,Bayley, J. in his judgment said: “A new relation which, inregard to this property, was wholly inconsistent with that oflandlord and tenant, then took place, with the consent of bothparties. Thatoperated as a surrender by operation oflawofthetenant's interest in the property".
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Sri Lanka Law Reports
1200012 Sri LR.
In the case in hand too, when the 1st defendant-appellanttook an assignment of the usufructuary mortgage inrespect of the soil share of Somawathi, (assuming that thel8t defendant-appellant had been a tenant cultivator till thattime) an inference could legitimately and properly be drawnthat a new relation was created and 1st defendant's interest inthe property as a tenant was surrendered and extinguished forgood.
It does not matter that neither the l8t defendant-respondent nor Somawathi (under whom the 181 defendant-respondent claimed to have cultivated as a tenant-cultivator)had ever intended that there should be a surrender of theinterest of tenant-cultivator-assuming of course, that thel8t defendant-respondent was, in fact, a tenant-cultivatorunder the said Somawathi for as Parke B had explained inLyon Vs. Reed161 (1844), referred to at page 205 in SpencerBower in his treatise on estoppel, it is the act itself thatamounts to a surrender. To quote: “In such a case there canbe no question of intention. The surrender is not the result ofintention. It takes place independently and even inspite ofintention. Thus, in the cases which we adverted to… it wouldnot at all alter the case to show that there was no intention tokeep it unsurrendered. In all these cases, the surrender wouldbe the act of the law, and would prevail inspite of the intentionof the parties”.
For the aforesaid reasons I do hereby dismiss the appealof the lBt and 2nd defendants-appellants and affirm thejudgment of the District Court.
The 1st and 2nd defendants-appellants are ordered to payRs. 10050/= as costs of this appeal to the lst-7th plaintiffs-respondents-in addition to what had been awarded bythe District Court. (This frivolous appeal had delayed theplaintiffs-respondents getting the relief they sought for wellover a decade).
Appeal dismissed.