064-NLR-NLR-V-53-NATCHIRE-Appellant-and-LEWIS-HAMY-et-al.-Respondents.pdf
NAGALINGAM J.—Natchire v. Lewis Hamg
299
1950Present : Nagallngam J. and Pulle J.NATCHIRE, Appellant, and LEWIS HA MY ejfc al.,Respondents
S. C. ISO—D. C. Gampaha, 114-
Mortgage Ordinance (Cap. 74)—Representation of estate of deceased mortgagor—Sections 6 and 7.
Where a hypothecary action was instituted against an heir of a deceasedmortgagor who was in possession of the mortgaged property—
Held, that where there is no executor or administrator appointed to theestate of a deceased mortgagor, an order of Court should be obtained undersection 7 of the Mortgage Ordinance (Cap. 74) to appoint a person to representthe estate and such person must be made a party to the action. Otherwise,the action is not properly constituted and cannot be maintained.
.^^.PPEAL from a judgment of the District Court, Gampaha.
H. W. Jayewardene, with J. M. Jayamanne, for the 1st defendantappellant.
S. C. E. Rodrigo, for the plaintiffs respondents.
G-ur. adv. vult..
October 20, 1950. Nagalingam J.—
The question for decision on this appeal is whether a hypothecaryaction instituted against an heir of a deceased mortgagor in possessionof the mortgaged property is well constituted.
The 1st defendant appellant who is the sole defendant in .the caseand who is the widow of the deceased mortgagor has been sued by theplaintiffs for the recovery of the. principal and interest alleged to bedue upon a mortgage bond executed by the deceased mortgagorhypothecating property referred to in the plaint. The estate left bythe deceased mortgagor who died intestate is admittedly under Rs. 2,500in value and the land hypothecated would appear to be also below .thevalue of Rs. 2,500. The appellant took the plea that she was not liableto be sued as an heir in possession who had adiated the inheritance.The learned District Judge has held against her and the appeal is fromthat order.
The determination of the rights of parties centres round the construc-tion of the provisions of the Mortgage Ordinance (Cap. 74). Now,section 6 (1) of the Ordinance declares that every person is a necessaryparty to a hypothecary action who has an interest in the mortgagedproperty, to confine one’s attention to so much of the section as is relevantfor the purpose of the present case. There is no express requirementin this section that a mortgagor or an administrator or executor of adeceased mortgagor is a necessary party but they are all compendiouslyreferred to by the phraseology adopted, “ Every person who has aninterest in .the mortgaged property.” The mortgagor and the executor
800
NAOAUNGAM J.—Natehire t>. Lewis Homy
or administrator of a deceased mortgagor would undoubtedly comehtwW the category of persons who have an interest in the mortgagedproperty. That thiB is the construction to be placed on section 6 (1)is made manifest by the other provisions of the Ordinance. Sub-section2 of section 6 draws a .distinction between two main classes of necessaryparties, one tha.t may be termed on absolutely necessary class and theother a class necessary only in certain circumstances. The one classconsists of (a) the mortgagor, (b) the executor or administrator of adeceased mortgagor, (c) the assignee of the estate of an insolventmortgagor. The other class' consists of puisne encumbrancers whobecome necessary parties only where the instrument under which theyclaim title is duly registered and an address of service of legal documentson them has also been registered. The effect of sub-section 3 is thatwhere any person falling under the latter class has failed .to complywith the requirement as to registration of the instrument or of theaddress, he need not be made a party, and though not so made a partyhe would be bound as effectually as if he had been. It will be noticedthat there is no similar provision in regard to the former class of personsand the reason for such absence is easy to see because that class ofpersons must in every instance be made a party defendant to ahypothecary action.
What is the effect of declaring that a mortgagor or the executor oradministrator of a deceased mortgagor is a necessary party to ahypothecary action in all circumstances whatsoever ? Or, to put itshortly, that a mortgagor or the executor or administrator of a deceasedmortgagor should be an absolutely necessary party to a mortgage action ?I think the only answer to that question is that unless an absolutely neces-sary party is made a party to the action, the action is not properlyconstituted and any decree entered would be ineffective to. bind theproperty hypothecated, for to take any other view would be to rendernugatory the requirement of the statute.
In has been contended that section 6 (2) applies only to cases wherethere is already in existence an executor or administrator and not tocases either where the estate of the deceased mortgagor requiring ad-ministration has not been administered or where no administration isin fact necessary. I think the first part of this contention is soundwhile the same cannot be said of the second part. The unsound partof the contention either ignores the provision of section 7 of the Ordinanceor does not give a proper meaning to it. The opening words of section7 “where-the executor or administrator of a deceased mortgagor is anecessary party to a hypothecary action ” clearly indicate an assump-tion by the Legislature that every estate, whatever its value, may bethe subject of administration proceedings. It will be obvious thatan estate not more .than Rs. 2,500 in value must of necessity be ad-ministered if the deceased died testate ; and even though an estatemay be under Rs. 2,500 in value and the deceased may have died in-testate, there is no legal bar to the administration of such an estate ;so that, -recognising these eventualities the section proceeds on the basisthat to any estate of a deceased mortgagor there may be an executoror an administrator and it then proceeds to make provision for cases
NAG ALIN GAM J.—Natchire c. Lewis Hamy
301
where no appointment; oi an executor or administrator may in facthave been made to the estate of a deceased mortgagor, by enactingthat the Court may appoint a person to represent such an estate for thepin-pose of the hypothecary action. The estates to which such anappointment could be made are divided into two broad groups: (1)where the mortgaged property—and be it noted not the estate—doesnot exceed the value of Rs. 2,500, (2) where, whatever the value of theestate, the appointment of an executor or administrator is likely to beunduly delayed. That the person appointed to represent the estatein these circumstances should himself be regarded as a necessary partyflows from the provision that if such a person is made a party to theaction, then, every order, decree, and sale, or thing done in a hypothecaryaction should be as effective as if the executor or administrator of thedeceased (who has already been declared to be a necessary party) werea party to i.t.
It must necessarily follow from this provision that where no executoror administrator has been appointed in respect of the estate of a deceasedmortgagor and no person has been appointed to represent such an estateunder – section 7, then any order, decree and sale or thing done in thehypothecary action would not. be as effective as if the executor or ad-ministrator of the deceased were a party to the action and must resultin the order, decree or thing done in such a hypothecary action beingaltogether ineffective and the mortgaged land would not be boundin consequence. I do not accept the contention of Counsel for therespondent that section 7 is merely a permissive section in regard tothe appointment of a person to represent the estate of a deceasedmortgagor to whose estate no appointment of an exeoutor or administra-tor has been made. The view I have reached is in consonance withthe previous history of the case law on the point which was finally andauthoritatively enunciated in the Divisional Benoh case of Thambcdyar v.Paramusamy Iyer 1 which was decided under the repealed provisionsof the Civil Procedure Code, and I am satisfied that the new Ordinancehas not the effect of altering the law in this regard.
I am therefore of opinion that where there is no exeoutor oradministrator appointed to the estate of a deceased mortgagor, thenan order of Court should be obtained under section 7 of the MortgageOrdinance to appoint, a person to represent the estate and such personmust be ma.de a party to the action, otherwise the action is not properlyconstituted and cannot be maintained.
I therefore hold that the plaintiffs* action is not properly constitutedand that the action fails. The judgment of the learned District Judgeis set aside and the plaintiffs' action is dismissed with costs here andin the Court below.
Pulls J.—I agree.
Appeal aUouxed.
» (1917) 19 N. L. R. 386.