096-NLR-NLR-V-59-SIRIPALA-Appellant-and-MAGIE-NONA-Respondent.pdf
BA SXAYAKE, C.J.—Siripala v. ?>Iagio JYo/ia
433
1958Present: Basnayake, C.J., and de Silva, J.SIRIPALA, Appellant, and MAG IE fSTONA, RespondentS. G. OS—D. G. Niacara Eliya, 3,9S3
Prescription Ordinance (Cap. oo)—Section 7—“ Cause oj action ”—Loan oj money—
Action for recovery—Requirement of prior demand for repayment—Civil Procedure
Code, s. S—Death of debtor—Liability of administrator. ,
By section. 7 of tho Prescription Ordinance :—
“ yio action shall bo maintainable for tho recovery of any movable properly,rent, or mesne profit, or for any money lent without written security, … or formoney duo upon an account stated, or upon any unwritten promise, contract,
, bargain, or agreement, unless such action shall bo commenced within threevears from tho time after the cause of action shall have arisen. ”
Held, that tho cause of action to sue for the recovery of a loan of money givenwithout any agreement as to the time of repayment does not arise until tholender has asked tho borrower for the return of tho money and tho borrowerfails to repay tho money within tho timo specified in t-ho lender’s demand. Theexpression “ cause of action ” is used in section 7 of tho Prescript ion Ordinancein tho sense in which it is defined in section 5_ of the Civil Procedure Codo.
Held further, that if tho debtor dies intestate and no demand for the returnof tho money lent was made in his life-time, any demand from the administratorcannot bo made before ho receives letters of administration.
.<A.PPEAL from a judgment of the District Court, Nuwara Eliya.
H. V. Perera, Q.G., with E. D. Gosme, for Plain tiff-Appellant.
A. L. Jayasuriya, with Norman Abeysinghe, for Defendant-Respondent.
Cur. adv. vull.
March 19, 193S. Basxavake, C.J.—
Tins is an action for the recovery of a sum of Rs. IS,190/55 from theadministratrix of the estate of the deceased G. S. V. Piyatillokc. Itwould appear from the statement of account filed with the amendedplaint that from January 1947 till April 1950 the plaintiff lent from timeto time to the deceased, his brother, various sums of money and thatafter giving credit for the repayments made by the deceased from timeto time there was due at the date of his death on 25th January 1951a’balance sum of Rs. IS,196/55. There is nothing in the pleadings or thesubmissions of counsel to show that the loans wer.e repayable by a fixeddate or that any interest was stipulated. The deceased appears to havemade regular pa3-ments on account from time to time but as he borrowedmore than lie repaid the amount lie owed continued to increase.
19lex’.
434
BASJVAYAEE, C. J.—Siripala v. Magie Kona
. -The plaintiff alleges that after the death of his brother he demandedpayment of the debt from the defendant-administratrix, his sister-in-law,'and that she failed to comply with his demand.
The plaintiff’s action has failed on the ground that his claim isprescribed, and that is the only question that arises for decision on thisappeal..'
The record of proceedings discloses that without framing any issuesof law or fact as required by section 146 of the Civil Procedure Code andwithout taking any evidence the learned District Judge proceeded tohear counsel for the respective parties on the questions raised by themincluding the plea of prescription, and that he thereafter proceeded todeliver judgment.
The learned District Judge has failed to observe the provisions ofsection 146 of the Civil Procedure Code which requires the Court eitherto determine the issues suggested by the parties or if thej' arc not agreedas to the issues to record the issues on which the right decision of the caseappears to it.to depend. The provisions of section 146 are imperativeand should be observed in every action.
In regard to the plea of prescription the learned District Judge hastaken the view that the plaintiff’s cause of action arose on 27th April 1950,the date on which the last loan was given. As more than three yearshad elapsed on 19th October 1955, the date on which this action wasinstituted, he has held that the action is statute barred.
Before I discuss the submissions of learned counsel for the appellantI shall quote so much of section 7 of the Prescription Ordinance as ismaterial. It reads—
' " No action shall be maintainable for the recovery of any movableproperty, rent, or mesne profit, or for any money lent without writtensecurity, … or for money due upon an account stated, or upon anyunwritten promise, contract, bargain, or agreement, unless such action. shall be commenced within three years from the time after the cause ofaction shall have arisen.”-
Learned counsel for the appellant submitted—
that for a cause of action to arise there must be a default on the part
of the debtor,.
that there can he no default unless the debtor •
fails to pay the loan on the agreed date, where there is a prior
agreement as to the time of payment, or'
where there is no such agreement, fails to pay the debt when
demanded.-.
Ho further submitted that in tho instant case there being no agreementas to the timo of payment and no demand having beon made from thedebtor in bis lifc-timo tho causo of action aroso only on the default of thoadministratrix to pay the debt when demanded..';
BASMAYAKI3, C.J.—Stripala v. -l/ajie'-V on a
43 5
Loans of money without a fixed date for repayment were knownto Roman-Dutch Law. Huber (Vol. I, pp- 4S4 & 4SS—Jurisprudenceof My Time) refers to them as loans during the lender's pleasure. Sueliloans were not payable except upon demand and after the time stipulatediu the demand. The lender had always to give a reasonable time in hisdemand for repayment having regard to the purpose for which the moneywas borrowed (Wcssels’ Law of Contractin South Africa, Vol. II, See. 2S92,2nd Edn. ; Maasdorp, Vol. Ill, p. 137, 4th Edn.).
The submissions of learned counsel arc in my opinion sound. Underour law a loan of money becomes due and payable on the date agreedupon by the parties as the date for repayment. Where there is no suchagreement a loan of money becomes due and payable after the lenderhas made demand. In this connexion it should be noted that our lawdiffers from the English law in that in our law in the absence of anagreement to the contrary it is l he duty of the creditor to seek out thedebtor (Wcssels, Vol. II, Sec. 2902, 2nd Kdn. ; Van Leeuwcn’s Roman-Dutch Law, Kotze, 2nd Edn., Vol. II, p. 329).
The rule in the Digest 50. 17.14 that in all obligations in which the timeof payment is not inserted, the debt is due immediately, has not beenaccepted by Roman-Dutch writers as applying without modification tocontracts of loan of money in which the terms of repayment are notstipulated. There will be no purpose in taking a loan of money ifimmediately it is given the lender lias a light to recall it. In such con-tracts the lender ought to grant such time as is reasonable having regardto the purpose for which the money is borrowed.
The heading of the Title of the Digest in which the rule occurs is “ BeDue ns is Reg id is Juris AvJiqui "—Concerning Different Rules of AncientLaw ” (Scott), and the rule itself is quoted as from Pomponius on Sabinus,Rook V. I agree with the view taken by the Roman-Dutch writers andthe Courts in South Africa (Fhixman v. Brittain 1 ; Wellington Boardof Executors Ltd. v. Sclmtex Industries (Pty) Ltd.) 3 that the rule ifapplicable at all to contracts of loan of money, and I doubt that it doesapply, cannot be applied without modification.
It. would appear from the judgment of Tindall J.A. (p. 294) in thecase I have mentioned first that wheremo term is specified for repayment,Pothicr takes the view “ that the lender ought to grant a time more or lesslong according to the circumstances, in the discretion of the Judge, forthe restitution of the sum lent, and that the borrower lias against thedemand of the lender, if he sues him before this time, an exception bywhich he ought to obtain from the judge a delay for the payment.”
It is sufficient for the purpose of this judgment to cite a passage fromVocC on the topic of loans of money without st ipulation as to time ofrepayment.••
“ Where no day lias been assigned, it must be repaid not forthwith, .but after the passage of a moderate time, so that in the meantime the. borrower will have been able to enjoy at least some advantage out of theloan and the use of the money. The period will have to be fixed at the
1
1.1952 (3) S. A. L. P. 170.
436
23ASNAYAKE, C.J.—SiripaJa v. Magic Nona
discretion of the judge as each case arises. When a loan for use'.isgranted ’without addition as to time, considerations of humane dutydo not allow tho use of the thing lent to he taken away untimeously.
• In the same way it would bo unfair for a borrower for consumption,who ought to have the assistance of the kindness, as it were,of the lender, to be mocked, deceived and cheated bjT the sudden recallof the money paid over. It is quite true that in all obligations to whichno time has been attached the debt is presently due. None the lesswe ought not on that account to take the view that humane feeling and. also judicial discretion have been barred but. The result is that whena borrower is sued a moderate period of grace to suit the changingcharacter of the transaction is vouchsafed either by the lender or bythe judge. It follows that you would rightly apply to this case thefamous saying of Paulus :‘ Though law fails me, equity prompts such
a conclusion-'
.Voet Bk XII, Tit. I, Sec. 19,
Gane’s Translation, Vol. 2, p. 772.
Now the cause of action to sue for the recovery of a loan given withoutany agreement as to the time of repayment does not arise until the lenderhas asked the borrower for the return of the money and he fails to repay. the money within the time specified in the lender’s demand. ■ After thelast day specified in the demand the lender may sue the borrower. – Theexpression cause of action in my view is" used in section 7 of the Pres-cription Ordinance in the sense in which it is defined in section 5 of theCivil Procedure Code. According to that definition in the case of a loanof money without any prior agreement as to the date of repayment thecause of action arises on the failure of the debtor to return the money ona demand being made and after the last day fixed in such demand. In ■the instant case the plaintiff states that he demanded the return of themoney from the defendant after she received the letters of administration.Any demand made from the defendant before she received letters ofadministration should not be taken into account because she was underno legal obligation to repay the loan except qua administratrix, andhe was not entitled to demand the repayment of the loan from her beforeshe was appointed.■
The learned District Judge was clearly wrong in holding that thecause of action arose on 27th April 1950, the date of the last loan. On thematerial before us we are unable to decide the issue of prescription as thedate of the issue of letters of administration and the date and nature ofthe demand made by the plaintiff from the defendant administratrixare not on record.'' –
We therefore set aside his judgment and decree with costs and send thocase back for trial after issues have been determined.=
The appellant is entitled to the costs of this appeal.
dk Silva, J.—I agree.
Judgment set aside.