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Present: Schneider and Lyall Grant JJ.WIJEYSINGHE v. VELOHAMY.
382—D. C. Negombo, 1,75*5,
Pactum antichresis—Liability of usufructuary mortgagee—Culpa levis.A usufructuary mortgagee is liable for damage caused to themortgaged property through his negligence (culpa levis).
HIS was an action to recover damages brought by the mort-gagor of property against the usufructuary mortgagee for
the neglect of the property while it was in the possession of themortgagee. The learned District Judge awarded a sum of Rs. 244as damages to the plaintiff.
H. V. Perera (with Amerasekera), for defendant, appellant.—The District Judge is wrong in holding that the duties of a usu-fructuary mortgagee are similar to those of a lessee in respect of thecare to be taken of the property he possessed. The usufructuarymortgagee may perhaps be liable for acts of commission that causedamage but not for acts of omission.
The mortgage bond must be construed strictly. The words" to hold and possess and to receive, take, and enjoy the produce,rents, and income in lieu of interest** mean that the mortgageeundertakes to possess the land merely to the. extent of taking theproduce and income for his interest. The mortgagor may enter theland at any time and do the repairs and weeding necessary. Themortgagee has not undertaken to keep the property in repair. Heis therefore not liable for ordinary negligence, viz., allowing thehouse to get into disrepair and not weeding the land.
Eajapakse, for plaintiff, respondent.—This is a pactum antichresiswell known to our Common law. A usufructuary mortgagee isliable for acts of omission and for ordinary negligence in an actiopignorantitia. Voet XIII., 7/5; Bandar's Justinian, pp. 331-332;
‘ Wille on Mortgages, pp. 219-221.
The agreement is that the mortgagee should “ hold arid possess *’the property. Full possession is with the mortgagee (Lee, 1st ed.,p. 179), and he can claim to possess every bit of the property asagainst the mortgagor till the bond is discharged.
March 12, 1928. Schneider J.—
In pursuance of an agreement in a bond that the mortgagor41 will allow and permit the mortgagee to hold and possess and toreceive, take, and enjoy the produce, rents, and income in lieu of
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interest ’’ of the property mortgaged, which consisted of landplanted with coconuts with a house standing thereon, possessionwas delivered and remained with the mortgagee till the debt waspaid and discharged. The mortgagor thereafter brought this actionclaiming damages for the neglect of the property while it was in thepossession of the mortgagee. He was awarded a sum of Rs. 244as damages sustained by the house not having been kept in properrepair and by the land being overgrown with weeds. No exceptioncould reasonably be taken to the amount of the damages awarded,but the appeal was pressed on the ground that the mortgagee wasunder no legal obligation to keep the house in necessary repair or toweed and tend the land. This contention is not sustainable. Theagreement in question on part of the mortgagor is one speciallypermitted by our Common law as a pact which might be lawfullyannexed to a hypothec. It is called the pactum antichresis. It maybe express or tacit. By virtue of it the mortgagee is entitled toenjoy the use (wsus) of the property himself by taking the fruit,living in the house, or cultivating the land, as the case may be, or hemay let the property to someone else, even to the mortgagor1.The ordinary rule of the Common law that a creditor to whompossession has been given of a mortgaged property is liable fordolus et cxdpa lata (fraud and gross fault) and also for culpa Jcvis(ordinary negligence) applies to a usufructuary mortgagee.2 Thatliability gives rise to his obligation not to be neglectful of theproperty pledged. Voet commenting on xhe contraria actio pig-noratitia says “ for as the creditor’s liability for fraud and culpadoes not suffer him to be neglectful of the thing pledged ”, &c.3The whole of the law on the subject is summarized by Wille inMortgage and Pledge in South Africa, p. 219.
The law is clear that it is the duty of a mortgagee to restore theproperty complete, and undamaged to the mortgagor when the debthas been fully discharged, and it therefore follows that to fulfil thatduty the mortgagee in this case should have effected the necessaryrepairs to the house and should have weeded the land in order torestore them to the State in which they were when he receivedpossession of them.
The appeal is dismissed with costs.
Lyall Gkaxt J—I agree.
1 Voet XIX. 2, 4 ; XX, 1, 21 and 23.1 Voet XIII. 7, 5.
Voet XIII. 7,10 (Berwick's Trans., p. 484).