021-NLR-NLR-V-23-HENDRICK-SINGHO-v.-KALANIS-APPU-et-al.pdf

[De Sampayo J.—It isoniy registration that wouldgive notice toan innocent purchaser.]
Registration is not compulsory.
[Bertram C.J.—According to yon, the words <c and registered ”in section 238 have no effect.]
That would be introducing the Registration Ordinance into our
l,Procedure Code.
Sahpayo J.—Seotion 238 is taken from the Indian Code,
ere there is no necessity to register. So these words must havein intend^vary the law.]
interferon, if any, has not been embodied in our Code inproper language. Till Hendrick v. Deen1 no attention was paid toregistration.
> Seen eider A.J. followed ’this case in Vdupittai v. Marimuttu?W regfejtjation is absolutely necessary, there is no necessity to declare& pemffcive. When theproperty is seized, it is in cmtoiia legis, andthjb debtor cannot deal with it.
OWicsal cited also Fiscals' Ordinance, No. 4 of 1867, seotion 42 jv, Weerasuriya3 and Tikiri Banda v. Lohi Banda.*
St. V. Jayawardene, K.Q. (with him M. W. H. de SUva), for^Before the Civil Procedure Code came into operation
fvate sales after seizure were void. Our Code departed from
mOrdinance and the Indian Civil Procedure Code in
>tioti of seizures. Under section 237 of the Civil
} seizure fe in force until it is remoy^^i fete property
bv the Fiscal.. The words us&l in., the old
Fiscals’ OrSfrjpjIee am.** during the continuance of the
j&8 embodies mM oldla^^t the Words used ai&i
£f8£ii»section 238 is to make a^pi) sale valid if se£
*L&t* *
i (2916) 3 O. W. £§||fi.
*( 2921) 22 N.L>
>5

Singho'v.
Kafanie
Appu

( 82 )
ig|*.
Hendrieh
'SlfSff
been registered. Judgment-debtor is not divested of histitle till aconveyance is executed by the Fiscal (section 289). Section290 doesgot permittee yudgraent-creditor or pxirchasertoenterinto possession,fb'is only the Fiscal that can do so. If the requirements of section'$3? had not been complied with, these sections do not come into forceat all. Seotions 237 and 289 must be read together. Aserappa v.WercUunga1 has n*> application. In SaravanamvMu v. Marviappa-and Tikiri Banda v. Loku Banda 3 registration or non-registration ofseizure was not in question. In Juan Appu v. Weerasuriya 4 theSupreme Court held that the point should have been taken in thelower Court. Hendrick v. Been 6 and VelupiUai v. MarimvMu 6 areentirely in point.
E. W. Jayawo/rdene, in reply.
Cu/r. adv. vult.
November 17,1921. Bertram C.J.—
This case has been referred with a view to reconciling the apparentinconsistency of two sections of the Civil Procedure Code as to theeffect of registration of seizures. Section 238 draws a distinctionbetween a seizure which is registered and a seizure Which is not. Inthe former case all private alienations up to a Fiscal's transfer are voidas against all claims enforceable under the seizure ; in the lattercase by implication all such private alienations presumably havetheir natural effect. Under section 289, however, the relation backof the Fiscal’s transfer and the consequent vesting of the property inthe purchaser as from the date of the sale in all cases alike seemsentirely to ignore that distinction. Under section 238 requiringthe seizure to be registered, the Legislature apparently intended toprotect bona fide purchasers from the judgment-debtor; to rewardthe execution-creditor if he registered his seizure and to penalize himif he did not. If such were the intention, and if section 289 is to;b$interpreted without qualification, that intention is in effect frustrated^!
In the view of Mr. E. W. Jayawardene, who appeared forappellant, this is one of those cases in whiofi the benevolent intentj.^:of the Legislature is frustrated by the incompetence of those.wiftrhave attempted to embody them in statutory form. The purchaseris indeed protected up to the Fiscal’s sale, but, so far as alienationsbetween sale and transfer are concerned, notwithstanding the expressreference to the sale in section 238, registration of seizure makes nodifference. All such alienations alike are obliterated by the rentingback of the purchaser’s title.
Mr. Jayawardene points to the Full Court decision in Aserappa v.WeraAunga1 as concluding the case in his favour, but properly under-stood that case settles nothing. It is a case of two oompeting Fifcal’stransfers and two.registered seizes. All that the case deck&td was
1 (1911) 14 N.. t. R. 417.* (1917) ZO N. L. R. 36.
fj^l889) 4-MT.L. R. 27.■8 (J$16) 3 O. W. R. 206.
-IgpUi) 16N.-&. R.63. '22 N. L. R. 281.
( 83 )
that the priority of the transfers was to be determined, not by the
date of their registration, but by the date of the respective sales to
which they sought to give effect. The cases in which Unreasoning, Bi^£AMof that case was adopted and followed, namely, Tikiri1Banda b.;
Loku Banda* and Juan Appu v. Weerasuriya2 were not oaseswhich the difficulty of reconciling sections 238 and 289 oame ijjftoconsideration. All that we can gather from this oase isthat thesolution of the difficulty is not to be sought in section 17 of the LandRegistration Ordinance, No. 14 of 1891. Inthe nature of things theprivate alienation, if registered, will almost certainly be registeredbefore the Fiscal’s transfer. But priority of registration here doesnot avail, since priority in terms of section 17 only avails against anantecedent transfer, whereas the Fiscal's transfer, though antecedentin effect, is subsequent in date. All that the case shows, therefore,is that the private purchaser, if he seeks to secure protection for hispurchase, must seek for it elsewhere than in the law of registration.
On the other hand, there are decisions of this Court—Hendrick v.
Deen 3 per Be Sampayo J.; VdupiUai v. Marimicttu 4 per SohneiderA.J. followed in C. R. Avissawella, 10,751,® and D. C. Jaffna,
14,221,® which have held that effect must be given to the apparentintention of the Legislature as disclosed in section 238, and that thetitle of a purchaser from the execution-debtor between the Fiscal’ssale and the Fiscal’s transfer, where the seizure was not registered,prevails against that of the Fiscal’s transferee. The question for' us is. whether, on fuller consideration, these decisions are to beupheld ?
The crux of the problem is the difficulty of harmonizing the twosections. The explanation is, I think, to be sought by investigatingthe separate history of each. Let us begin with section 238. BeforeCivil Procedure Code of 1889, the effect of seizures on subsequentalienations was regulated by section 42 of the Fiscals*
IgdSLance, No. 4 of 1867, which is in the following terms:—
“ After any property shall have been seized in execution, and^ the case of a seizure by written order after it shall have been-pulv intimated and made known in manner aforesaid, anyalienation or encumbrance of the property seized (excepting bythe Fiscal or Deputy Fiscal or under their order as hereinafter,provided) whether by sale, gift, mortgage, or otherwise, andany.^payment of the debt or debts, or dividends, or shares to the partycondemned during the continuance of the seizure, shall be nullxand void.”
The terms of the sectionarethus very general. Itissufficientthatthe gaizure is Effected and made known in the prescribed manner. Ifthis fordone all private alienation “during the continuance of the
1 (1911) IS N. L. B. 63.v 1 (1921) 22 tt. L. R. 291.
(1917) 26 N. L. R. 35,*8.0. Min., March 8,
(1916) 3 C. W. R. 29S.««. 0. Mini:, Jane 75,19^
< 84 )
1921..
Bertram
C.J5.
tfdendrickSingho v.KaltmiaAppu
seizure,” that is, right tip to the Fiscal’s sale, are ipso facto void.Compare this section ■with section'238. The intention to effect achange in the law could not he more clearly indicated. By section?37 provision is made for a special register of seizures. It is onlyozlvregistration being effected that the principle' of section £2 of the-Fiscals’ Ordinance is now to operate. The requirement is express.“ The Fiscal shall forthwith transmit .a copy.” It was clearlyintended that only when this was done should a judgment-creditorhe able to rely upon carrying out an effective sale ; that the registerof seizures was intended to be adefinite statutory form oi notificationto persons who might otherwise deal with the property, and that,if the seizure was not registered, persons who acquired a title in theinterval between seizure and transfer, whether under sale, gift,mortgage, lease, or otherwise, shall be protected. Why, if this werenot the intention, was the register of seizures created ? And why,if the period of protection was not to extend to the actual transfer,was an express reference to " conveyance ” inserted in the section ?
It might be argued that there are no express wvzH protectingpersons claiming under such alienations ; that property cnee, ssi&edby the Fiscal is in emtodia legis ; and that no interests can be createdin property so held to the prejudice of the judgment-creditor. Butwe are not concerned with the general principles of i&w governingproperty in mstodia legis. Our Code is a complete Code. Indeclaring that certain transactions—certain ’transactions alone,namely, alienations after registration of seizure—shall be affectedby the seizure, it in effect declares that other transactions shall
be unaffected.
When, therefore, having thus changed the law, i^ie Legislatureproceeded to enact section 289, is it to bo taken that it Intended toderogate from the new principle, and that having expressly extendedthe implied protection accorded by section238 right up to the Ft^tal’# -transfer, it intended by the relating back of the transfer, as rega^$the period between sale and transfer, to annul the protectionhas bestowed ? Again, the history of this section must be klllfliat. With what was section 289 really concerned ?
fkjihe Fiscals’ Ordinance (1867) there is nothing to correspond289. But it must not be supposed that the principle ofdteat&ction was here introduced for the first time. There is the highauthority of Wendt J. See. Silva v.j&ona Hamine1 fox the proposi-tion that section 289 did not ^egt any change in the law. Thisappears to bo th© justification f<^^e deration in Selehatny v. Raphiel3decided before the Cods took effect. See also Abvbalccr v. Eiuuetana.8Section 289, then, was intended to enact a iegaUgghtiple already inforce. Its object was not to qualify or neutmllpPIhe change of laweffected by section 238. It had a principle cf its o&a. The principle
(2906) 20 N. L.at p. 482.21*4*9). 1G. R. 73. *
8 (1880) 9 S. CM. 82.*
( 85 )
of Section 289 appears to be that after sale and until conveyance thejudgment-debtor and any person holding under him and deriving' title through him holds any legal title he may possess in trust for thepurchaser, and that though What is called the “ legal estate ” doesnot vest in the purchaser till the sale, and although until that ev$nthe has only an “ equitable ” estate, yet when once the conveyance isexecuted, the grantee is deemed, for the purpose of all rights andtransactions that depend on his title, to have been vested with hislegal estate from the date of the sale. (See Silva v. Hendrick Appu.1)Thus, if the purchaser has made any conveyance in the interim, sucha conveyance is deemed to have passed the title, even, though at thedate of the conveyance, title had not actually accrued. Similarly,the purchaser is -entitled to all rents and profits, as though he were,owner, and the debtor meanwhile is only entitled to such limitedrights as are given him by section 231. But though the purchaser *thus vested with the debtor’s legal estate from the date of the sale,this is always subject to any derogation from that legal estate thatmay have taken place in favour of any other parties, whose-rightsthe Code elsewhere recognizes.
The principle which section 289 was intended to embody had,thus, nothing to do with the principle of section 238. It had noreference to the section. It was simply concerned wxfch bridgingaver the inevitable gap between sale and transfer, and regulatingthe rights and the effect of the transactions of all persons concernedin the interim.
Mr. E. W. Jayawardene laid great stress upon the words in section283 “ or of any person holding under him or deriving title throughhim/' and insisted that they indicated an intention that the rights ofany persona claiming by virtue of a title derived from the judgment-debtor between sale and transfer should be extinguished by therelation back. As a matter of fact, however, after a careful consider-sghn of the section, I do not believe that the words “ person derivingthrough himJ*' were evsi intended to include a purchaser froml^^^ment-debtor. The words no doubt seem wide enough to coversuch a ease, but I think that a fuller examination of the section wifishow that they were r ot intended to do so. As my brother.Sj&rissuggested during the argument, the words “ holding under |&a5?refer to lessees, and the words “ deriving title throngh bim^&eeintended to comprise persons deriving title by inheritance or asexecutors or administrators. The$e is one consideration whichseems to me conclusive. The-^pfy purchasers is question arepurchasers since the sale. Mr. f5ayawardene concedes that pur-chasers on priv^^alienations after an unregistered seizure axeprotected*, atup to the sale. What is the sense, then, cf
saying, as Mr. E. w, Jayawardene would make the section say, thatu the right and title of purchasers from the judgment-debtor since .
i
1 (1&) l L.-B. !.?.
■*5*
*1921,
Bertram
C,J.
Hendrick
Smghov.
Kalania
Appu
1924,.
Bbbtbam
O.J.
HendrickSingho v.KalaniaAppu ,
( 86 )
the sale is not divested by the sale ?99 How could, a right acquiredafter a sale be divested by it ? Further, the words cannot refer toalienations between seizure and sale, as such alienations are notaffected by the relation back. It appears dear, therefore, that thewords do not refer to parsons claiming under alienations at all,whether since the sale or since the seizure. If such persons had beenin contemplation, I think they would have been described in the sameformula as that used immediately before in section 287, that is,
“ persons claiming under a title created by the judgment-debtor.99
I would, therefore, hold that the persons referred to in section 238were not in the contemplation of section 289 ; that section 289 wasenacted in connection with a wholly different principle; and that anyreference to the “ legal estate 99 of the debtor, whiQni$ may contain,must be read subject to any derogations from that “ legal estate,"which the law has elsewhere either expressly or by implicationrecognized. In other words, the relation back of the purchaser’stitle was not intended to override any competing title, hut merely tosecure that all rights and transactions which have arisen or takenplace in the interval on the footing of a title which was “ equitable "only should be deemed to have arisen or to have taken place upon thebasis of a legal title.
For these reasons, therefore, I would uphold the previous decisionsof this Court, affirm that of the learned District Judge, and dismissthe appeal, with costs.
Ennis J.—I agree.
De Saeopayo J.—
I am unable to uphold either of the contentions on behalf of theappellant. It was, in the first place, argued that the^pro visions ofsection 289 ef the Civil Procedure Code were absolutely operativeinall cases, and that, on the confirmation of an execution sale and theissue of the Fiscal’s conveyance, the title of the purchaser by relationback to the date of sale prevailed over any intermediate alienationby the execution-debtor. I think this is too large a proposition, forit takes no account of a case in which the seizure may not have beenregistered as provided in section 238 of the Code. It would involveour holding, as indeed Mr. E. W. Jayawardene boldly invited us todo, that there was no meaning ot effect in the registration of seizures,and that section 289 would operate so as to squeeze out a privatealienation, whether the seizure was registered or not. This cannot,be right. Section 238 of our Code is based upon section 276 of theold Indian Code, where* however, there is nothing corresponding tothe provirion for r^P&tion in our Code. This provision wasdeliberately added, some meaning must be given to it. Itappears clear that our Code intended registration of the seizure to be
( 87 )
a condition (or making the subsequent sale effective against aliena-tion by the execution-debtor, in -whom section 289 itself declaresthe title remains vested until the confirmation of the sale and theexecution of the conveyance in favour of the purchaser. Registra-tion of the seizure is a safeguard, on the one hand, on behalf of theexecution-creditor who may thus prevent the execution beng renderednugatory by a private alienation, and, on the other hand, on behalfof a person who may bona fide deal with the debtor in ignorance ofanyseizure. If the seizure is not registered, the necessary implicationof section 238 is that a bona fide private alienee is statim semrus.I think that section 289, as regards relation back, must be read in thelight of section 238, and its operation should not be extended to acase where th£ sSiiure has not been registered. Section289is not in-tended to override the effect of section 238, but is a general provirion;connecting the conveyance with the sale and giving to the purchaserin an appropriate case the advantages of ownership as from the dateof the sale. Having once declared that the title of the debtor wasnot divested by the sale until the confirmation of the sale and theexecution of the Fiscal’s conveyance, it had necessarily to state whatwould be the result if the sale was confirmed and the conveyanceexecuted. I need not dwell on that point further, because I adhereto the opinion expressed by me in Hendrick v. Dem.1
Mr. Jayawardene, in the second place, argued that, even if theregistration of the seizure was an element of consideration, theprivate alienations, which would be protected in case of non-regis-tration, were only those effected before the sale and not thereafter.This argument is equally untenable. It is in the teeth of section 238which refers to alienations after the seizure and before the sale “ andconveyance of the property by the Fiscal,” and of section 289which provides that if the sale is confirmed by the Court “ and theconveyance is executed in pursuance of the sale ” the grantee in theconveyance is deemed to have been vested with the legal estatefrom the time of the sale. It is thus clear that, in the case supposed,alienations made up to the date of the conveyance are protected.The present case is one of that kind.
In my opinion the appeal fails, and should be dismissed, with costs.
1921.
Dr SaupavoJ.
HendrickSingho v,KalanisAppu
♦
•
1 {1916) 3 C. W, R. 206.
Appeal dismissed.