018-NLR-NLR-V-77-S.-M.-SURABIEL-SINGHO.-Appellant-and-P.-DHARMASENA-and-3-others-Respondents.pdf
H. N. G. FERNANDO, C.J.—Surabiel Singho v. Dharmasena
121
1971 Present: H. N. G. Fernando, C.J., and de Krester, J.
S. M. SURABIEL SINGHO, Appellant, and P. DHARMASENAand 3 others, Respondents
S. C. 278/67 (F) —D. C. Gampaha, 13513
Vendor and purchaser—Transfer of immovable property—Condition thatvendor may re-purchase the property within a specified period—Subsequent transfer by the vendee to a third party—Rights of theoriginal vendor or his successors in title as against the third party—Contract—Position when the same person unites in himself thecharacter of creditor and debtor—Doctrine of merger.
An agreement by which a person binds himself to sell a land doesnot depend on the personality of the parties. In the absence of aprovision to the contrary, the agreement is enforceable not only bythe party (or his successors in title) who is entitled to the transferof the property but also by a stranger to whom he has ceded hisright. This principle would therefore be applicable to a case wherea person is entitled to a re-conveyance of property (or an undividedshare of it) which he has transferred to another subject to a rightto re-purchase the property within a specified period.
Where A, who has purchased an undivided share belonging to Band C on condition that he should re-transfer that share to B and Con payment by them of a certain sum of money, subsequently buysB’s share of the right of re-purchase, A’s obligation to re-transferthe property becomes reduced in consequence of his becoming bothobligor and obligee to a partial extent.
A PPEAL from a judgment of the District Court, Gampaha,
Ranganathan, Q.C., with M. T. M- Sivardeen and K. Kanaga-ratnam, for the plaintiff-appellant.
Mo appearance for the defendants-respondents.
Cur. adv. vult.
March 2, 1971. H. N. G. Fernando, C.J.—
One Heras Singho was the owner of an undivided 3/8 share ofcertain land, which share is hereinafter referred to as “theproperty ”. Upon Deed PI of 22nd May 1961 he sold the propertyto one Carthelis Appu for a sum of Rs. 400, but subject tothe condition that Heras Singho shall have the right to re-purchase the property within a period of 5 years on payment ofthe sum of Rs. 400 together with interest at the rate of 8 per centper annum. Carthelis Appu by the Deed F2 of 1963 transferredthe property to the 1st defendant Dharmasena, but this transferwas subject to the same condition for re-transfer in favour ofHeras Singho.
Lxxvn—6
1*—A 07437—2,805 (09/74)
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H. N. G. FERNANDO, C.J.-—Surabiel Sirtgho v. Dharmastna
Heras Singho died unmarried and issueless sometime prior tothe expiration of the 5-year period stipulated in PI, leaving asintestate heirs his father Podi Singho, his sister Alice and fourchildren of his deceased sister Baby Nona. Immediately priorto the death of Heras Singho he had a right under the Deed PIto ask for a re-transfer of the property, if he repaid the sum ofRs. 400 specified in PI and also paid interest on that sum at therate of 8 per cent per year. Since the property had beenconveyed in 1963 to the 1st defendant that condition was bindingalso on the 1st defendant. But when Heras Singho diedintestate the right to claim a re-transfer vested in his intestateheirs, one-half of that right vesting in the father Podisingho, a1/4 of that right vesting in the sister Alice, and the other 1/4 ofthat right vesting in the four daughters of the sister Lily Nona.
By the Deed P3 of 8th April 1965, the father Podi Singhoconveyed to the present plaintiff “ all the rights title anh interestI have from my said late son Heras Singho of re-purchasing thesaid premises Thereafter Alice Nona and two of the fourdaughters of Baby Nona conveyed to the 1st defendant the rightswhich they had acquired in respect of this property as heirs ofHeras Singho. The resulting position after the execution of P3and P4 was that the plaintiff held 1/2 of the right to repurchasethe property, that 1st defendant held 3/8 of that right, and thatthe other two daughters of Baby Nona held the remaining 1/8of that right.
In an action filed on 14th May 1966 the plaintiff claimed aConveyance of a 3/16 share of the land and brought into Courta sum of Rs. 350 purpoting to be the amount due for there-transfer of that share. It will be seen that the plaintiff, inseeking a 3/16 share of the land, was asserting his of the rightto purchase the property.
The learned District Judge has dismissed the plaintiff’s actionon two grounds, firstly that after the death of Heras Singho, theright to demand a re-transfer of the property did not pass to hisheirs, and secondly, that the right to re-transfer is not divisible.Incidentally also, the learned Judge appears to have thought thateven if a re-transfer could be sought by an heir of Heras Singho,the condition in the Deed PI required that the full payment ofRs. 400 plus interest must be made therefor.
It is convenient to deal firstly with the last matter reliedupon by the trial Judge, namely, that the sum of Rs. 350 was aninsufficient payment by the plaintiff. It will be seen that, beforethe plaintiff instituted this action, the 1st defendant had by P4acquired a 3/8 share of the right of re-purchase originally heldby Heras Singho. In consequence of this acquisition by the 1st
ll. N. G. FERNANDO, C.J.—Surabiel Singko v. lJharmasena
123
defendant, the obligation of the 1st defendant to re-transfer theproperty had become partly merged in the 1st defendant himself,I would refer in this connection to Wessels on Contracts. 1stEdition, p. 765 et seq :—
“ Conjusio, in a wide sense, as a mode of extinguish-ing a right, occurs when two incompatible rights areunited in one and the same person. ”
“ When, however, we speak of confusion in connec-tion with the law of contract, we mean the dischargeof a debt arising from the fact that the same personunites in himself the character of creditor and debtor.”
“ This discharge is not based on performance or onwaiver, but on the principle that a person cannot inthe same capacity be his own creditor and debtor.A person cannot demand payment of himself or suehimself. ”
“ Confusion usually takes place where the creditorbecomes the universal successor of his debtor or, viceversa, where the debtor becomes the universalsuccessor of his creditor. ”
“ It may be stated generally that confusion takesplace whenever a debtor succeeds in any way to therights of his creditor. ”
“ If the creditor for the part of the debt becomes theuniversal successor of the debtor, the confusion takesplace only as to the part for which he is creditor. ”
In the instant case the 1st defendant, when he purchased thisproperty became a debtor or obligor and was under an obligationto transfer the property if Rs. 400 plus interest at 8 per cent wasduly paid to him- (I shall be showing later that the heirs ofHeras Singho were in law entitled to make the payment anddemand the re-transfer.) But by the acquisition under the DeedP4 of the interest which some of those heirs had in the right ofre-purchase, the 1st defendant’s obligations to transfer theproperty became reduced in consequence of his becoming bothobligor and obligee to a partial extent.
According to PI, the maximum amount payable for the re-transfer of the property would have been Rs. 560, i.e. Rs. 400 plusRs. 160 being interest for 5 years at 8 per cent. Since however,3/8 of the right of re-transfer had become merged in the1st defendant himself, the sum payable became reduced by 3/8,i.e., Rs- 560—Rs. 210. It will thus be seen that the amount ofRs. 350 which the plaintiff brought into Court did in fact cover
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H. N. G. FERNANDO, C.J.—Surabiel Singho v. Dkarmasend
the value of the right which remained in Heras Singho’s heirsafter the merger of 3/8ths of that right in the 1st defendant. I amtherefore of opinion that the Judge erred in thinking that theamount brought into Court by the plaintiff was insufficient.
I am in agreement with the learned District Judge that theright of re-transfer is not divisible, in the sense that any heir ofthe original owner cannot separately claim a transfer of onlysome share in the property, and that the obligation is tore-transfer the entirety of the property which is subject to thecondition. But in this case the fact that the original property,i.e., the undivided 3/8 share transferred by PI, could not beclaimed in its entirety was due to the fact that the right to claimthe entire property had become reduced by reason of the 1stdefendant’s own acquisition by P4. In the result, all that couldthereafter be claimed by Heras Singho’s heirs was 5/8ths of theproperty.
The plaintiff has claimed only a conveyance of a 3/16 shareof the land, that is to say, a 4/8 and not a 5/8 interest in theproperty. This is obviously because he concedes to the twoother daughters of Baby Singho the remaining 1/8 interest inthe right of re-conveyance. But he has brought into Court thefull consideration which would have been payable if the whole5/8 interest had been claimed in his plaint. Thus the 1stdefendant has by merger acquired a 3/8 interest in the right ofre-conveyance and the plaintiff has brought into Court the fullamount payable for a re-conveyance in respect of the remaining5/8 interest in the original property. The 1st defendant thereforestands to gain, and is in no way prejudiced, by the fact that theplaintiff has not chosen to demand a re-conveyance of the wholeof the outstanding 5/8 interest in the property. (Indeed he hasjoined the 2 daughters of Baby Nona, and could have claimedthe whole 5/8 interest.)
The remaining ground on which the learned Judge heldagainst the plaintiff was that the right to re-purchase was nottransmitted to the heirs of Heras Singho. In dealing with thepactum de retrovendendo, Voet (Gane’s translation Vol. 3, p. 297)states the position as follows : —
“ Moreover not only does the seller sue on this agreement,but also his heir, according to the usual nature of agree-ments, the benefit of which enures to heirs just as much asto the actual parties to the agreements. So much is this sothat if certain of the heirs do not wish to buy back, thatright accrues to the remaining heirs.
Xanayakkara, v. The State
126
This right again when available under agreement can beceded even to a stranger, since it is not personal, and everyright of action which has not been expressely excepted can.be sold and ceded- ”
An agreement like the present one, by which a person bindshimself to sell a land to another does not depend on the persona-lity of the parties, and in the absence of provision to the contraryan agreement to sell a land to A can be enforced by the heirsof A.
In Tikiri Menika v. Alwis1 (35 N.L.R. 372), this Court heldthat, where a deed of sale by one Loku Banda to the defendantincluded a condition for the re-transfer of land to Loku Banda,the condition was enforceable by Loku Banda’s heirs ; this,although the deed did not expressly provide that the heirs ofLoku Banda had a right to the re-transfer. In so holding, theCourt relied on the passages from Voet which I have citedabove.
For these reasons, I would set aside the decree under appeal,and enter judgment for the plaintiff as prayed for, with costs inboth Courts.
de Kretser, J.—I agree.
Appeal allowed. i
i (1933) 35 N. L. R. 372.