Ramakrishnappa, M. vs Kempamma

The appellant, who was the defendant in OS No. 756 of 1972 on the file of the V Addl. First Muasiff, Bangalore has preferred this second appeal against the judgment and decree dated 21-1-1973 of the I Addl. Civil Judge, Bangalore, in RA No. 161 of 1974 on his file by which he has set aside the judgment of the Munsiff and has decreed the plaintiff''s suit. The respondeat herein was the plaintiff in the suit.

In the suit she had filed, the plaintiff claimed reimbursement of the sale price of Rs. 1,000 paid to the defendant under a registered sale-deed, Rs. P 1, dated 12-5-1964 executed by him in her favour, plus interest on the said sum at 6% per annum from that date upto 31-1-1972, thus, in all amounting to Rs. 1,546, with Court costs and future interest.

Her case was that making her believe that he was the owner in possession of a plot of land site (fully described in the plaint), the defendant had executed the aforesaid sale deed in her favour obtaining the consideration mentioned above; that, in the year 1970, when she and her husband, after making necessary financial arrangements, proceeded to construct a building on this site they came to know, on being told, that the site and the surrounding area had been acquired by the City improvement Trust Board, Bangalore, long prior to the execution of the said sale deed and that the executant had no title to convey the same in her favour; that she thereafter got issued a notice to the defendant toreimburse the sale price from him; and that since there was no response from him she had brought this suit for the aforesaid reliefs.

The defendant (is his written statement) admitted of hit having executed the sale-deed and contended that they were bound by the recitals in the sale deed. He further pleaded that he was in possession of the property sold on the date of sale and had put the plaintiff in possession of the same. He denied the averments that the property had been acquired by the Trust Board earlier to the sale deed, but, again, in the alternative, pleaded that even if such an acquisition was true, the plaintiff must be presumed to have had knowledge of the same when she obtained the sale deed and that, in the circumstances, she should not be permitted to turn round and complain against him and claim reimbursement of the amount paid under the sale-deed. He denied his liability to pay any monies as claimed. He further pleaded that the suit was barred by time.

The Munsiff found from the evidence adduced by the parties that the site had been acquired earlier to the said sale-deed and that, in the circumstances, the defendant was liable to reimburse the amount obtained by him from the plaintiff under the registered sale-deed dated 22-6-1964, but he dismissed the suit on the ground that it was barred by time. According to him the plaintiff should have brought the suit within three years, as contemplated under Art. 55 of the Limitation Act, 1963, (the Act) from the execution of the sale -deed dated 22-5-1964. The suit having been brought on 3-4-1972 was, according to him, barred by time.

The learned Civil Judge, while con curring with the Munsiff on other issues, but not agreeing with his finding on the question of limitation, held that the suit was in time, and allowed the appeal decreeing the suit as prayed for.

In this appeal the only question that survives for consideration is as to whether the suit was barred by time. Rightly the learned Counsel for the appellant also confined his arguments to this question.

It is not is dispute that it is Art. 55 of the Act that governs the claim. That article provide? that "for compensation for the breach of any contract, express or implied" not otherwise specially provided for under the Act, the suit, if any, will have to be filed within three years "when the contract it broken or (where there are successive breaches) when the breach in respect of which the sat is instituted occurs or (where the breach is continuing) when it ceases". This article corresponds to Arts. 115 and 116 of the Limitation Act, 1908. Under Art, 116 the period of limitation provided to recover compensation for breach of contract in writing registered was six years. Now, as stated above, it is three years.

On the question of the starting point of limitation in case of suits by vendees claiming reimbursement or compensation for the breach of the covenant of title, arising under an express covenant in the sale-deed or by reason of the implied covenant for title, there is a plethora of case law. After digesting the various ratings of Courts the learned Authors Chitaley and Bakhale in their "Limitation Act, 1963", Vol. 1 (5th Edn) at page 1147 classify the cases and observe as follows:

"As to when limitation commenced and when the cause of action for compensation arose in such suits, the cases may be classified and considered under three heads, namely:

(i) Where from the inception of the Sale the vendor had no title to convey, and the vendee, who was entitled to be put in possession on the date of sale had net been put in possession of the properties.

(ii) Where the sale was only voidable en the objection of third parties and possession was takes by the vendee under the voidable sale.

(iii) Where the title was known to be imperfect end the contract was in part carried out by giving possession of the properties to the vendee.

In the first class of the oases where the sale was void from its inception and no possession was given to the vendee, the starting point of limitation was the date of the sale-deed. The covenant for title was not a continuing covenant capable of a continuing breach. In the undermentioned case (AIR 1970 Orissa, 89) it was held that Art. 115 (of the Act of 1908) did not apply. In the second class of cases, the cause of action for a suit for compensation arose only when it was found that the vendor had no good title, and so long as the vendee remained in possess ion without his title being questioned or affected, be was not damnified. Normally, the date of the dispossession of the vendee at the instance of the third party having superior title would be the starting point in such cases. Where however, the title of the third party was put forward and agitated in a Court of law in a suit to which the vendee was also a party, the date of the decree of the first Court which upheld the title of the third party was held to be the starting point, but not the date of the appellate Courts decree confirming that of the trial Court. In the last mentioned class of cases it was held that the fact that the vendee managed to remain in possession even after the decree of the first Court negativing the title of his vendor would not stop the running of limitation. In other words, in such cases the date of the decree and not the date of dispossession in pursuance of the decree would be the starting point.

With regard to the third class of cases, where the sale was void ab initio, but in pursuance of the sale the purchaser was put in possession, of the property soli, it was held that limitation started from the date on which the. vendee was dispossessed by the rightful owner, and not from the date of the sale deed. (Underlining (italics) supplied).

The registered sale-deed, Ext. P 1, recites that the vendor had given possession of the site to the vendee, that there was no previous encumbrance, and that if there were to arise any dispute in this connection that it would be his responsibility to get that matter settled at his cost, and in case he was unable to do so, he would compensate her for the loss she may sustain. Apart from the document reciting about the vendor having delivered possession of the site to the vendee, the said fact has been reiterated by the defendant in his written statement referred toabove (Para 4 of the written statement). Though the plaintiff does not say in so many words in her plaint of her having obtained possession of the site under the gale deed, it is not her case that she had sot come into possession. Her specific case in the plaint was that, after making preparations to proceed with the construction on the site, she and her husband had been to the spot some time in the month of Febry. 1970 and then had come to know of the site having been acquired earlier to the sale deed etc. She got the fact verified thereafter and found that to be a fact. In the circumstances instead of asserting her possessory right over the site, she withdrew and, knowing that title did not vest in her, abandoned possession and proceeded to pursue her claim for breach of the implied warranty of title and at well as the breach of the terms of the sale deed.

The learned Counsel for the appellant very strenuously contended, placing reliance on some cases, that since it is the case of the plaintiff that the defendant did not have title from the very inception, the time started running against her from the date of the execution of the sale-deed Itself. Perhaps that would have been the position if it was her case that she had not been put in possession of the site under the sale deed. She appears to have abandoned her right to be in possession of the site somewhere in Febry. 1970 having come to know that her vendor had no title tothis site to convey the same in her favour. In the circumstances, it can fairly be assumed that, until she gave up possession voluntarily in 1970, she was in possession of the site. If she can be said to have lost her possession in this fashion somewhere is Febry. 1970, time started to lay her claim against the vendor from that time onwards and not from the date of the sale deed. In this connection I may usefully refer to the following observations of Hegde, J., (as he then was) in Basappa v. Kodliah, AIR 1959 Mys. 46.

"In a suit for damages for breach of the implied warranty of title, the non-production of the sale deed in favour of the plaintiff is immaterial when the defendant docs not plead a contract to the contrary. The reason is that warranty of title claimed is a statutory one which does not require to be established by the sale deed.

The statutory warranty is available to the plaintiff even if he was aware of defect in the title of the vendor. The cause of action for the suit arises on the date of dispossession and not on the date of the sale deed and hence the suit cannot be dismissed on the ground that it has been filed a very long time after the sale". (Head-Note).

It is true that, in the instant case, no third party can be said to have dispossessed the plaintiff from the site. She herself gave up her claim to be in possession of the site having come to know that no title re. the same has been conveyed to her by the defendant. In my opinion it need not be only a case of dispossession by coercion or by any coercive step. Voluntarily abandoning one''s possessory right or giving up possession, having been certain that he had no right to continue in possession, would be sufficient to provide a cause of action to the party. One of the learned Judges of the Andhra Pradesh High Court construes such cases as cases of constructive dispossession giving rise to a cause of action under Art, 55 of the Act. The following observations of the learned Judge in Illavajjula Ramalingam v. Korraprolu Veerabhadrayya, AIR 1959 AP 445, may be noted:

"In a suit for damages for breach of the covenant for title and for quiet enjoyment, the covenant for title as well as for quiet enjoyment can be said to be broken at the same time, that is, when there is either actual or constructive dispossession. It is true that the mere accrual of a right to dispossess in favour of a third party does not ipso facto and be instanti give rise to a cause of action in favour of a vendee against the vendor, and damage for breach of covenant either for title or for quiet enjoyment cannot arise until the vendee is dispossessed. But that does not mean that the vendee should be dispossessed only by coercive process in the course of execution of the decree made against him. There is nothing to prevent a person from surrendering possession in obedience to a decree which he is bound to obey or from buying off, instead of surrendering possession, the third party''s right to dispossess him. When he does so, his cause of action against his vendor arises on such surrender or payment. If, of course such payment or surrender is made after execution of the decree for possession becomes barred by time, then he would be doing something which he need not have done and cannot complain that he has been hurt. In such a case he may have no cause of action at all. But so long as that decree is not barred, it is open to him to give up possession to the third party or make a payment to him purchasing his right to dispossess and then claim against his own vendor damages for breach of his covenants". (Head-Note). I respectfully agree with the above views.

I have stated above the case of the parties in their pleadings on the question of possession. In his evidence also the, defendant asserts that he had put the plaintiff in possession of the site. In cross-examination, though he asserted that the site was lying vacant, further admitted that at the time of his deposition (on 11-1-1974), it was in the possession of the City Improvement Trust Board. It is clear from the evidence on record that, making the plaintiff believe that be had both title and possession, the defendant executed the said sale deed in her favour and the plaintiff, believing herself to have acquired title and assuming that she was in possession of that open site continued under that assumption, and that subsequently, in 1970, abandoned her right tobe in possession of that site having come to know that her vendor had no title when he executed the sale deed, Ext. P 1. In my opinion, this case comes under the third category of cases referred to by the learned Authors Chiraley and Bakhale (extracted above). Since the plaintiff''s suit was within three years from the date of her abandoning of her claim to be in possession of the site, the same was in time. In this view of the matter and for the reasons stated above I am of the view that the findings of the Civil Judge are not liable to be disturbed.

Therefore, this appeal is dismissed with costs throughout.