040-SLLR-1984-V1-DIAS-v.-DE-MEL-AND-ANOTHER.pdf
CA
Dias v. De Mel (Atukorale. J.)
263
DIAS
V.
DE MEL AND ANOTHER
COURT OF APPEAL.
ATUKORALE. J. (PRESIDENT) AND B E. DE SILVA. J.
C.A. No 365/76 (F)-D.C. COLOMBO 74575/M.
DECEMBER 15, 1983.
Civil Procedure Code, section 219. section 222 as amended by Civil Procedure Code* (Amendment) Act. No. 53 of 1980-Admims nation of Justice (Amendment) Law: No.25 of 1975. section 549-Decree for payment of monies out of estate ofdeceased-Personal liability of legal representative-Burden of proof-Form of applicationunder section 222 (2) of the Civil Procedure Code.
The plaintiff obtained decree against the two defendants in their capacity as executorsof the estate of the late'A. M. C; Dias for the recovery of a sum of Rs. 28.828.71 cts.The first defendant, upon notice issued under section 219 of the Civil Procedure Code,filed affidavit that the executors were not in a position to pay the amount due on thedecree as no liquid or realisable assets of value were available except one estateKitulhena which was vested in the Land Reform Commission but not yet compensated' for. At the section 219 inquiry, it transpired that another estate Mahavila had beenpossessed by a beneficiary who had conveyed it to her son.
After the section 219 inquiry the plaintiff filed an application under section 222 (2) ofthe Civil Procedure Code to have the decree executed against the defendants personallyon iwo grounds, viz., (a) the defendants had failed.to apply two of the properties,namely. Kitulheha and Mahavila belonging to the deceased which had come into theirpossession, for the purpose of paying the decreed amount and (b) the defendants hadgiven an undertaking not to terminate the proceedings in the testamentary action untilthe amount due on the decree was settled. After the repeal of the Civil Procedure Code,and the coming into force of the Administration of Justice (Amendment) Law, No. 25of 1975, the plaintiff filed a fresh application under section 549. the correspondingsection of the said Law, to have the decree executed against the defendants personally.The judge dismissed the plaintiff's application after inquiry. The plaintiff appealed.
Held-
Although under section 549 (1) of the Administration of Justice (Amendment)Law. No. 25 of 1975. a decree such as the present one may be executed by the seizure 'and safe of any property of the deceased in the hands or under the control of the partyagainst whom decree is entered, the decree-holder is not entitled to proceed againstthe personal property of the legal representative against whom the decree is passed.Section 549 (2) which is almost identical with section 222 (2) of the Civil Procedure
264
Sri Lanka Lew Reports
[1984] 1 SriL.R.
Code, creates art exception to ttiis general rule and enables the decree-holder, in certain
circumstances, to execute the decree against the legal representative personally, Forthis exception to be invoked the decree-holder must establish that some propertybelonging to the estate of the deceased came into the hands or under the control of thelegal representative and that at the time execution is sought no such property remains inhis hands or under his control. Once the decree-holder establishes this fact the burdenshifts to the legal representative to satisfy court that he has duly applied the propertywhich has been proved to have come into his hands or under his control. If he fails to doso. he becomes personally liable upon the decree to the extent of the property that hasnot been duly applied by him.
The undertaking not to conclude the testamentary case without first settling theliability to plaintiff has no relevance.
The failure of the plaintiff to make an averment in her petition that there were noassets left ogt of the deceased's property to meet her claim on the decree does notpreclude her from maintaining an application under section 549 (2) of theAdministration of Justice (Amendment) Law, No. 25 of 1975.
An application under section 222 (2) of the Civil Procedure Code as amended bythe Civil Procedure Code (Amendment) Act, No. 53 of 1960. should be by way ofpetition and affidavit setting out the material facts, to which the judgment-debtor mustbe made a respondent. In terms of this provision, the court must after inquiry grant theapplication, if it is satisfied that the decree should be executed against thejudgment-debtor personally.
APPEAL from an order of the District Court of Colombo. ■
Miss M.Seneviratne S. A. with Hilton Seneviratne for the plaintiff-appellant.
Mark Fernando for the defendant-respondents.
Cur. adv. vult.
March 2, 1984.
ATUKORALE, J. (President).
The plaintiff, vyho is the present appellant, filed this action against thetwo defendants, who are the executors of the estate of the late A. M.C. Dias, for the recovery of a sum of Rs. 28,828.71 cts. consisting ofmonies advanced by her at the request of the defendants for runningcertain estates which formed part of the estate of the deceased and ofmonies spent by her in connection with the deceased's funeral. Thedefendants were sued in their capacity as executors and the claim wasfor money to be paid out of the estate of the deceased. The case wassettled on 7,12.1972 and a decree was entered in favour of theplaintiff for the full amount. Upon a notice issued under s. 219 of theCivil Procedure Code the 1st defendant filed an affidavit dated22.10.1973 together with .a copy of the inventory filed in the
CA
Dias v. De Mel (Atukorate, J.)
265
testamentary case in which he averred that as no liquid or realisableassets of value were available, they {the executors} were not in aposition to pay the amount due on the decree. He further averred thatsteps were being taken to sell a property called Kitulhena, that the salewas expected to realise about Rs. 25,000 but that the proceeds werenot sufficient to pay the outstanding estate duty, income tax and thetestamentary expenses. He also stated that all the estates (exceptKitulhena) were vested in the Land Reform Commission and that assuch the executors were not in a position to sell them and that thebonds issued as compensation for these estates will have to beutilised to liquidate the liabilities and no payment could be made to theplaintiff until then. On 15.1.1975 the 2nd defendant was examinedunder s. 219. At the inquiry it transpired that the estate calledMahavila Estate was possessed by a beneficiary, one Swama Mendis,and that she had transferred the same to her son. On 6-8.1975 theplaintiff filed an application under s. 222 (2) of the Civil ProcedureCode to have the decree executed against the defendants personally.Two grounds were urged in the application. One was that at theinquiry heid under s. 219 it was revealed that the defendants hadfailed to apply two of the properties (namely, Kitulhena and MahavilaEstates) belonging to the deceased and which came into theirpossession for the purpose of paying the decreed amount. The otherground was that the defendants had on 5.9.1974 in this case givenan undertaking not to terminate the proceedings in the testamentarycase until the amount due on the decree was settled. After the repealof the Civil Procedure Code and the coming into force of theAdministration of Justice (Amendment) Law, No. 25 of 1975, theplaintiff filed a fresh application on 5.7.1976 under the correspondingsection (s. 549) of the said Law, to have the decree executed againstthe defendants personally. The defendants filed their objection? on2.9.1976. The matter came up for hearing on 28.10.1976. At thehearing no evidence was led by either party. Counsel on both sidesmade oral submissions. The learned Judge by his order dismissed the1plaintiff's application. He held that there was nothing to show that thetestamentary case had concluded and that the defendants had actedcontrary to the undertaking given by th^m, He further held that as theplaintiff's petition contained no averment to the effect that no assetsof the estate were left to pay the amount due on the decree after thealienations of Kitulhena and Mahavila Estates, the plaintiff was notentitled to execute the decree against the defendants personally. Thepresent appeal is from this order of the learned Judge.
266
Sri Lanka Low Reports
[1984] 1 SriLR.
"In the present case although the decree does not in express termsdirect that the amount decreed is to be paid out ol the property of thedeceased there seems to be no doubt and it was not disputed beforeus that the defendants' liability on the decree was to pay out of theassets of the estate of the deceased. The provisions of law underwhich the plaintiff made the two applications for execution of thedecree against the defendants personally, namely, s. 222 (2) of theCivil Procedure Code and s. 549 (2) of the Administration of Justice(Amendment) Law, No. 25 of 1975, are almost identical. S. 549 (1)of the said Law stipulates that a decree such as the present one maybe executed by the seizure and sale of any property of the deceased inthe hands or under the control of the party against whom it is entered.According to this subsection the decree-holder is not entitled toproceed against the personal property of the legal representativeagainst whom the decree is passed. Subsection (2) of s. 549 of thesaid Law, however, creates an exception to this general rule. Itenables the decree holder in certain circumstances to execute thedecree in the same manner as if the decree had been entered againstthe legal representative personally. Subsection (2) to s. 549 reads asfollows :
"(2) If no sucn property can be found, and the judgment-debtorfails to satisfy the Court that he has duly applied such property of thedeceased as is proved to have come into his possession, the decreemay be executed against the judgment-debtor to the extent of theproperty not duly applied by him, in the same manner as if thedecree had been against him personally.'
The opening words "if no such property can be found" in the abovesubsection, in my opinion, refer to property of the deceased in thehands or under the control of the party against whom the decree ispassed. That is to say, before this subsection can be invoked it mustbe established that there is no property belonging to the deceased in^he hands or under the control of the legal representative of thedeceased against whom the decree has been passed. The burden ofestablishing this fact is on the decree-holder. He must therefore, in the. first instance, satisfy court that some property belonging to the estateof the deceased came into the hands or under the control of the legalrepresentative and that at the time execution is sought no suchproperty remains in his hands or under his control. Once thedecree-holder establishes this fact the burden shifts to the legal
CA
Dias v. Oe Mel fAtukorale. J.)
267
representative to satisfy court that he has duty applied the propertywhich has been proved to have come into his hands or under hiscontrol. If he fails to do so, he becomes personally liable upon thedecree to the extent of the property that has not been duly applied byhim. Subsection (2) of s. 549 of the Administration of Justice(Amendment) Law, No. 25 of 1975, thus enacts a rule of procedureby which a legal representative is made personally liable to the extent .to which he fails to duly account for the property of the deceased that.has come into Yiis possession. As stated by me earlier s. 549 of theaforesaid Law is almost identical with s. 222 of the Civil Procedure •Code. The latter section has been amended by the Civil ProcedureCode (Amendment) Act, No. 53 of 1980, by the addition of a furthersubsection immediately after subsection (2). The amendmentprescribes that the application under subsection (2) should be by wayof a petition and affidavit setting out the material facts to which thejudgment-debtor must be made a respondent. It also provides thatthe court shall after inquiry grant the application, if it is satisfied thatthe decree should be executed against the judgment-debtorpersonally.
The learned Judge has, in my opinion, failed to address his mind tothe matters that arose for his consideration on the plaintiff'sapplication under s.549 (2) of the Administration of Justice(Amendment) Law, No. 25 of 1975.-His conclusion that there is nomaterial to show that the defendants have acted contrary to theundertaking given by them seems to be correct. But it had norelevance to the application before him. On the construction placed byme on s. 549 (2) as set out above, I am also of the opinion that thefailure of the plaintiff to make an averment in her petition that therewere no assets left out of the deceased's property to meet her claimon the decree does not preclude her from maintaining the application.The order of the learned Judge is therefore set aside and the case isremitted to the District Court for a fresh inquiry under s. 222 (2) of theCivil Procedure Code as amended by Act No. 53 of 1980. Thedefendants will pay the plaintiff the costs of this appeal fixed at Rs.
.315 recoverable from the estate of the deceased.
B. E. DE SILVA. J.-l agree.
Order set aside.
Case femitted for fresh inquiry.