024-NLR-NLR-V-27-FERNANDO-et-al.-v.-MENDIS-et-al.pdf
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Present: Schneider and Dalton JJ.
FERNANDO et al. v. MENDIS et ah102—D. C. Negombo, 14,231.
Decree, assignment of—Before decree nisi is made absolute—Applicationby assignee after final decree to have himself substituted—CivilProcedure Code, s. 339.
When, after decree nisi had been entered in an action, the plaintiffassigned the decree, and the assignee applied to have himselfsubstituted as plaintiff after the decree had been made absolute.
Held, that the assignment was good, and that the assignee ftasentitled to make the application under section 339 of the CivilProcedure Code.
r pHE plaintiff in this action on June 10, 1920, obtained a decree-1- nisi against Singha Fernando and his wife, Welpina Silva,declaring certain interests in land bound and executable.Thereafter on August 5, 1920, he assigned the decree in the actionto one Kumarappa Chetty. Decree absolute was, however, enteredup only on August 16, 1920. Kumarappa Chetty’s interests byvarious assignments devolved on the first and second respondentswho applied under section 339 of the Civil Procedure Code to besubstituted in place of the plaintiff.
The application was opposed by the first and second appellantswho are wife and husband. The first appellant is a transferee ofWelpina’s interests in the lands, the subject-matter of the action,and the second appellant is executor of the last will of SinghaFernando.
The application for substitution was allowed by the learnedDistrict Judge, and the appeal is from that order.
H. F. Perera for first and second defendants, appellants.
Drieberg, K.C., with Groos Da Brer a, for defendant, respondent.
Amereselc&re, for petitioner, respondent.
August 28, 1925. Schneider J.—
On June 10, 1920, the plaintiff in this action obtained a decreenisi against Singha Fernando and his wife, Welpina Silva, declaringcertain interests in five allotments of land bound and executable.On August 16, 1920, this decree was made absolute.
•7/121925.
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1925.
SCHNBIDER
J.
FemanJo v.Mendie
On August 5, 1920, the plaintiff assigned the decree in this actionand the decrees in several other actions “ and all (his) right, title,,interest, claim, and demand into and upon the same ” to one Kumar-appa Chetty.
On November 12, 1921, Kumarappa Chetty, by his attorneyKandasamy, assigned the decree in this action to the first respondentto this appeal (Mendis Silva) and one John Fernando who is saidto have assigned his interest to the second respondent to this appeal(Romel Fernando).
In May, 1924, SinghaFernando, the judgment-debtor, died leavinga last will of which he appointed the .second appellant (GomisDharmasiri), the executor, and by which he devised all his propertyto his daughter, the first appellant (Salegin Fernando). Theappellants are wife and husband.
The other judgment-debtor, Welpina Silva, is said to have trans-ferred her interests in the lands executable under the decree to thefirst appellant.
In October, 1924, the first respondent petitioned the Court underthe provisions of section 339 of the Civil Procedure Code to havehimself substituted as plaintiff in order to enable him to levy execu-tion under the decree. To this petition he omitted to make WelpinaSilva a party. She should have been made a respondent to it asshe is one of the judgment-debtors. He made the appellantsparty-respondents, alleging that they were in the possession of thelands executable under the decree. He was not justified in makingthem party-respondents on that ground, but he was entitled tomake the second appellant a party on the ground that he was theexecutor of the deceased judgment-debtor, Singha Fernando. Hemade his co-assignee a party-respondent, on the ground that herefused to join him in making the application. He was in orderin doing that. He also made the third respondent to this appeal(Allis Silva) a party-respondent, on the ground that he was inpossession of the lands under the appellants as their lessee. Thishe was not entitled to do.
To the first respondent’s application objections were taken,by anargumentative affidavit made by the first appellant. It wasobjected that there was a non-joinder of necessary parties and a mis-joinder as regards the appellants and their lessee. It was alsopleaded that the decree had been paid and fully satisfied. Admittedlythe satisfaction of the decree which was pleaded had not beencertified. Both parties appeared to have realized at the commence-ment of the trial that there were defects on each side. Eachcondoned the defects of the other’s case. The objection to non-joinder was expressly waived. The other objections were notpressed. It was agreed to accept the affidavit as an application tohave satisfaction of the decree entered of record under section 339,
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and the trial proceeded to all appearance upon the one question ofthe satisfaction of the decree. After trial the learned District Judgeallowed the first respondent’s application with costs to be paid by theappellants, and directed that he be substituted plaintiff as beingentitled to half the decree. This appeal is against that order.
On appeal Mr. Perera for the appellants argued—
That the appellants were wrongfully made parties to the
application;
That the writings purporting to be assignments of the decree
did not in fact effect an assignment of the final decree ; and
That the evidence proved that the decree had been satisfied.
Since the argument I have perused the petition of appeal, and it
seems to me that he was not justified in taking up the time of thisCourt in arguing the first point. There is not a word in the petitionof appeal urging that point. The proceedings at the trial showthat this objection had been abandoned. In the petition of appealthe appellants state in so many words that they had been madeparties because they were “ the legal representatives ofthedeceased.”That may not be a strictly correct statement of fact, because itwas only one of the appellants who was the legal representative,but it confirms the conclusion which is to be drawn from the pro-ceedings as a whole that the appellants regarded themselves ashaving been rightly made parties as representatives of the deceasedjudgment-debtor and proceeded to trial upon that footing.
The second point argued by him also appears nor to have beenpressed in the lower Court. It is also not set out in the petition ofappeal. It is purely a question of law, and will be discussed fullyby my brother Dalton. I will therefore only say shortly how theargument strikes me. Mr. Perera argued that a party to an actioncan lawfully assign his interest in the action or in the decree in hisfavour, but the decree must be final. He could not assign a decreenw*. I am unable to accept this contention. The assignment bythe plaintiff in this action to Kumarappa Chetty appears to me to begood and effectual, whether regarded as an assignment of the decreenisi which was the only decree in existence at the time, or as anassignment of the plaintiff’s interest in the action. The words of theassignment permits either view being taken. I regard the assign-ment as that of the plaintiff’s interest in the action which at thetime was crystallized in the decree nisi, that is, all the plaintiff’s'right to a decree for the sum mentioned in the decree nisi, unless thedecree nisi were set aside. Our Civil Procedure contemplates insection 404 the possibility of the assignee of the rights in a pendingaction being substituted as a party on the record, but leaves thematter entirely within the discretion of the Court. If, therefore,after such an assignment the action goes forward without the sub-stitution of the assignee even to the stage of a final decree, the
12(61)29
1925.
SCHNEIDER
J.
I ■■’ ■
Fernando v.Mendii
.( 146 )
1986.
Schneider
J.
Ftmando v.Mendis
assignee’s rights under the assignment will not be prej ndiced. Thereis no reason why they should. He will step into the place occupiedby his assignor on the record at the point when the Court grants himleave to be substituted. In this action final decree had been enteredin favour of the plaintiff at the time the first respondent to this appealsought substitution. The first respondent’s application was, there-fore, rightly made under section 339 of the Code. The originalassignment of the decree nisi had by that date ripened into anassignment of the decree absolute. He was entitled to step into theplace occupied by the plaintiff on the record at that date. I would,therefore, .hold against Mr. Perera’s contention on this pointalso.
There remains the third point urged by Mr. Perera that the decreehad been satisfied by payment. It is the only one of his three pointswhich finds a place in the petition of appeal. On this point, too, Iwould hold against him. The appellants were not in a position togive any direct evidence on this point. Mr. Perera had to relymainly on a solitary sentence in the evidence of Kandasamy, theattorney of Kumarappa Chetty, who as attorney assigned thedecree to .the first respondent and John Fernando. The sentence-was “ Singha (i.e., the judgment-debtor) paid the sum due to me.”But it would be unreasonable to interpret his evidence by this onesentence alone. In the very next sentence he modified it altogether.He said “ Singha, John, his son (one of the assignees of the decree)and the petitioner (i.e., the first respondent to this appeal—the otherassignee of the decree) all came to pay me the money. All three paidmoney to the notary who paid it to me.” What is obscure in thisevidence, as the witness does not say why the money was paid, iscleared by the first respondent’s evidence that he paid Kandasamy“ Es. 2,500 through the notary for the assignment of half 'share ofthe decree,” and that “ the assignment was made directly after (he)paid the money.”
I have no hesitation, therefore, upon the evidence in coming to theconclusion that the decree was not paid and satisfied.
The appeal is dismissed with costs.
Dalton J.—
This is a somewhat involved matter which is not assisted bythe way in which the order of the Court below has been drawnup.
The facts appear to be as follows :—The plaintiff in the action(No. 14,231 Negombo) Ramasamy Chetty on August 16, 1920,obtained a decree absolute on a mortgage claim for the sum ofEs. 4,062*50 against Singha Fernando and Welpina Silva, the twodefendants in the action. A decree nisi had been obtained on June10, 1920.
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On August 5, 1920, plaintiff by deed No, 1,097 purported toassign to one Kumarappa Chetty the decrees obtained in the variouscases enumerated, including this case No. 14,231, “ and all the right,title, interest, claim, and demand of him, the said Ramasamy Chetty,into and upon the same.’'
On November 12, 1921, the attorney of Kumarappa Chetty bydeed, after reciting the claim of the plaintiff in the action and theassignment of August 5, purported to assign for the sum of Rs. 5,000to one Mendis Silva and John Fernando—
The said decree No. 14,231 by virtue of the said deed of assign-ment No. 1,097 and the right to recover updn the saiddecree the amount appearing therein from the thereinnamed debtors or their heirs, and all the other right, title,claim and interest of me, the said Kumarappa Chetty, inand to the said decree.”
The notary who attested the deed of assignment certifies that theRs. 5,000 was paid in his presence.
John Fernando thereafter assigned his rights to Romal Fernando.
Singha Fernando, the first defendant, already mentioned, died in1924, and left his property to one Gomis Dharmasiri.
Welpina Silva, the second above-mentioned defendant, in 1920*transferred her property to one Salegin Fernando.
Gomis Dharmasiri and Salegin Fernando granted a lease of theproperty or part of the property in question to Allis Silva.
Mendis Silva now petitioned the Court to substitute him in placeof the original plaintiff, in terms of section 339 of the Civil ProcedureCode, to enable him to realize the amount of the decree assignedover to him ; Romal Fernando, Salegin Fernando, Gomis Dharma-siri, and Allis Silva were respectively made first, second, third, andfourth respondents to the petition.
After hearing evidence led for and against the petition, thelearned trial Judge came to the conclusion that petitioner wasentitled to be substituted as “ substituted plaintiff ” as prayed for,and to recover half of the amount of the decree, Romal Fernando, thefirst respondent (as assignee of John Fernando, one of the assigneesof Kumarappa Chetty) he held should also be substituted asa “ substituted plaintiff ” entitled to half the amount of the decree.
The second and third respondents were directed to pay the costsof the petitioner, the first respondent to pay his own costs. Thefourth respondent did not appear on the petition.
From this decision the second and third respondents, SaleginFernando and Gomis Dharmasiri, now appeal, the two grounds arguedbeing—
That at the time of the assignment, August 5, 1920, by theplaintiff in the action, there was no decree in existence.
(ib) The decree was satisfied, and the assignment conveys no rightto so much of the decree so satisfied.
1925.
Dalton a*.
Fernando v.Mendis
( 148 )
1925.
Dalton J.
Fernando u.Mendis
With respect to the first ground, the principal one relied on for theappellant, the decree nisi was obtained on June 10,1920, the assign-ment is dated August 5, and the decree was made absolute on August16. The argument addressed to this Court is to the effect that thedecree not being made absolute until a date subsequent to the assign*ment, no decree in fact existed at the date of the assignment,and therefore the petition of the applicant should have beendismissed.,
The provisions of the Code dealing with decrees in summary pro-ceedings are sections 377 and 383. Under the first-named section,the Court is authorized to make an order nisi, conditioned to takeeffect on the event of the respondent not showing cause against it onthe appointed day. On that day, under the provisions of section 383the petitioner appears, and the Court may make the order absolute,ordismiss the petition as may appear right.
The record shows that on the date the decree was made absolute,it was the plaintiff who appeared and not the assignee. The firstdefendant was also present. As no cause was shown in the termsof the section quoted, the decree was made absolute as against both*defendants.
The assignment of the rights of a party in a pending action afterlitis contestatio is not illegal in Ceylon. It is in fact specially pro-vided for in section 404of theGode(PlessPol v.deSoysa1). Mr. Pereradoes not deny the plaintiff’s legal power to assign his rights in theaction prior to decree nisi; he does not deny his right to assign adecree in the action, which must however he argues be a final decree.What however one may ask are the plai ntiff’s rights in the periodbetween the granting of the decree nisi and the making of it absolute.Has he no power to assign those rights, whatever they may be ?Has not the decree nisi taken the place of his right of action ? It istrue that it is a conditional order, but no authority has been cited tothis Court to show that the rights under an order of that naturecannot be assigned, although it is true they may turn out to beworthless. The case of Podia Veda v. Fernando 2 does not deal withthis point, nor with one analogous to it. The case of Subramaniamv. Ponnampalam 3 deals with the assignment of a decree whichhad been specifically set aside, whilst there is nothing that 1can see in the judgment in Fry v. Vandespaar 4 which assists theurgument for the appellant on this ground.
The provisions of section 404 of the Code would in any case appeario be directly opposed to the argument addressed to us. That sectiondeals with procedure in the case of assignment pending the-actionbefore a final order has been made. The equivalent provision underthe Indian Civil Code is contained in section 372. In a case arising
*(1907) 10 N. L. R. 262;{29m 16 N. L. R. 57.
*9S.C. C. 207.
6 C. W. R. 245.
5 C.W. R. 85.
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under that section (Ghunni Lai v. Abdul Alt Khan and others l)a question arose as to the rights under a decree nisi made undersection 88 of the Transfer of Property Act, 1882, and whether a suitterminated until an order absolute was made. It was held thatwhere such a decree is assigned before an order absolute is made,the assignee takes subject to all the liabilities resulting from theapplication of the doctrine of lis pendens.
In the case before us, the decree having been made absolute,although after assignment, whatever might have been urged at thetime application was made by plaintiff to make the order absolute,at this stage when the petition was presented to the Court) theassignee was in my opinion correct in proceeding under the provisionsof section 339.
• The second ground of appeal was not argued at any length. Inconsidering it, it is necessary to look at the course the matter took inthe Court below, the attitude of the parties there, and the questionsthe trial Judge had to decide as the matter was placed before him.As the trial Judge points out the position of the plaintiff was notseriously contested, and there is ample evidence that he paid Kanda-samy Pulle, the attorney of Kumarappa Chetty, the sum of Bs. 2,500for the assignment of a half share of the decree. The assignment wasmade to the petitioner and John Fernando, because the second andthird respondents refused to join in the transfer of the property to thepetitioner. As I have already stated the facts have certainly becomeinvolved, and some order had to be come to out of the confused stateof affairs brought about by the second and third respondents on theevidence before the trial Judge. I am of opinion he was justified incoming to the conclusion that petitioner was entitled to be substi-tuted as plaintiff in respect of half the amount of the decree. Forthe reasons he gives which are adequately supported by the evidence,it also follows that the first respondent is entitled to be substitutedfor the plaintiff in respect of half the amount of the decree.
The appeal of the second and third respondents to the petitionshould therefore in my opinion be dismissed, with costs.
Appeal dismissed. i
1985.
Dalton j.
Fernando v.MendU'
i 23 AUa. 331.