Sarah Gabriel vs R.D. Solomon and Others

Sale, J.—The Plaintiff in this case as the administratrix to the estate of one Silas alias Salley Elias Ezra sues to enforce a mortgage which was executed by the Defendants the mortgagors on the 23rd November 1894 in favour of Silas Elias Ezra to secure the sum of Rs. 12, 000 lent and advanced by him to the Defendants, the mortgagors, and which sum the Defendants the mortgagors covenanted to repay to Silas Elias Ezra, his executors, administrators and assigns. Silas Elias Ezra died intestate on the 6th April 1897 leaving a widow and some infant children and the Plaintiff alleging herself to be a creditor of the deceased in respect of certain moneys deposited with him under two trust deeds, executed in 1891 and 1895, applied for, and on the 4th February 1898 obtained letters of administration to his estate. The petition on which the Plaintiff applied for administration stated that the mortgage debt of Its. 12, 000, which is the subject-matter of the present suit, formed part of the estate of the deceased and the grant of letters of administration to the Plaintiff was made after the issue of special citations to the widow of the deceased and the Administrator-General of Bengal. Besides the usual relief on the mortgage the Plaintiff prays as against the Defendant, the Official Trustee, that it may be declared that the Plaintiff as the administratrix as aforesaid is entitled to enforce the payment of and to recover from the Defendants, the mortgagors, all moneys due by them under the indenture of mortgage, and for an order that the Defendant, the Official Trustee, may be ordered to produce and deliver up to the Plaintiff as such administratrix as aforesaid the original of the aforesaid indenture of mortgage together with all title deeds of and relating to the said mortgaged premises now in his hands as aforesaid. The relief claimed as against the Defendant, the Official Trustee, is based upon the following allegations in the plaint --That the deceased Silas Elias Ezra was also the trustee of a legacy of Rs. 70, 000 granted to one Joseph Hyem Ezra under the Will of David Joseph Ezra, and that upon the death of the trustee, Silas Elias Ezra, the Defendant, the Official Trustee, was at the instance of Joseph Elias David Ezra, the sole executor of the Will of Elias David Joseph Ezra, appointed on the 12th of July, 1897 the sole trustee of the said trust estate in the place and stead of the deceased trustee Silas Elias Ezra. The Plaintiff further states that the Defendant, the Official Trustee, alleging that the deceased trustee Silas Elias Ezra advanced the sum of Rs. 12, 000 from the trust fund of the said Joseph Hyem Ezra, contends, but the Plaintiff denies, that the debt due upon the aforesaid mortgage forms no part of the assets of the said intestate Silas Elias Ezra but that the said mortgaged premises form a portion of the trust estate which is vested in him as trustee of the trusts created by the Will of David Joseph Ezra. It appears that David Joseph Ezra by his Will directed that the sum of Rs. 70, 000 should be set apart for the benefit of his grandson Joseph Hyem Ezra and his children, and he appointed his son Elias Joseph David Ezra the executor and trustee of his Will, and directed that the powers conferred by the Trustees'' and Mortgagees'' Powers Act as to appointing new trustees should be vested in him during his lifetime and after his death in his executor.

Elias Joseph David Ezra during his lifetime acted as trustee of the fund set apart for the benefit of Joseph Hyem Ezra and by his Will appointed Joseph Elias David Ezra his executor and assigned to him all the estate vested in him as trustee subject to the equities and trusts affecting the same. Probate of this Will was obtained by Joseph Elias David Ezra on the 19th of February 1886 and acting under the powers vested in him as such trustee and executor, he, by a deed of appointment, dated the 17th of May 1886, appointed Silas Elias Ezra trustee in the place and stead of the deceased trustee.

Silas Elias Ezra executed the mortgage in suit on the 23rd November 1894 without disclosing any trust in respect of the money advanced to the mortgagors, and after his death in 1897 Joseph Elias David Ezra, again proposing to act under the powers vested in him as the executor of the Will of Elias David Joseph Ezra, applied to this Court for the appointment of the Official Trustee as trustee of the trusts created by the Will of David Joseph Ezra in respect of the legacy of Rs. 70, 000.

The Petitioner alleged in his petition that the trust estate now consisted in part of the sum of Rs. 12, 000 lent and advanced to the Defendants, the mortgagors, by Silas Elias Ezra--which loan was secured by a mortgage of the premises No. 10, Grant''s Lane, in Calcutta, and he further alleged that the beneficiary Joseph Hyem Ezra had died a lunatic in 1890--and that the grandmother of the infant children of Joseph Hyem Ezra had been appointed by this Court the guardian of their persons and property, and that at the request and desire of such guardian he had requested the Official Trustee to become the trustee of the Will of David Joseph Ezra so far as it related to the legacy of Rs. 70, 000, and that the Official Trustee had consented to become and that he, the Petitioner, under the powers vested in him was desirous of appointing him sole trustee of the said trust estate.

The order of appointment which was made on this petition purports to be made under the provisions of Act XVII of 1864, the Official Trustees'' Act, and is dated the 12th July 1897, and it orders that the Official Trustee be appointed the sole trustee of the properties, funds, securities or moneys appertaining and relating to the trusts created by the Will of David Joseph Ezra concerning and in respect of the legacy of a sum of Rs. 70, 000 set apart for the benefit of Joseph Hyem Ezra by the Will of the said deceased in place and stead of Silas Elias Ezra, deceased, and that amongst other properties the mortgaged premises No. 10, Grants Lane, more particularly described in the schedule annexed to the order and other the funds and securities representing the said trust estate do vest in the Official Trustee and that he is to hold the same subject to the rights and equities affecting the same. At the hearing the Defendants, the mortgagors, appeared and admitted execution of the mortgage which was produced by the Official Trustee and expressed their willingness to pay off the mortgage debt on obtaining a discharge from the Plaintiff, and in these circumstances it was contended for the Plaintiff that she was entitled to the usual mortgage decree and to get in the money thereunder which the mortgagors were willing to pay and that the proper course for the rival claimants to the money represented by the Plaintiff in her personal capacity on the one side and the Official Trustee on the other, was then to proceed to establish their rights to the money by separate suit or otherwise, the money remaining in Court for the purpose. In connection with this argument it was pointed out that the Plaintiff in her personal capacity was no party to and was unrepresented in the suit and that it would be improper therefore to permit the Defendant, the Official Trustee, to proceed to establish his claim to the money in this suit in the absence of the other claimant. I am unable to adopt this view. It seems to me I am bound to determine the question which the Plaintiff has herself raised in this suit as between herself as representing the estate of Silas Elias Ezra and the Official Trustee, as to her right to enforce the mortgage. The Defendant, the Official Trustee, contends that the effect of the order of the 12th July 1897 is to place him in every respect as to the trust estate created by the Will of David Joseph Ezra in the place and stead of Silas Elias Ezra and that as the mortgage debt and security in suit is a part of that estate he is now entitled to the benefit of the covenants of the mortgage deed and to sue thereon, and if necessary, to get in the mortgage money.

If this contention on the part of the Official Trusee is well founded, it would follow that the grant to the Plaintiff of letters of administration to the estate of Silas Elias Ezra did not vest in her any rights created by the mortgage in suit and that she is therefore not entitled to maintain this suit in her representative capacity. As regards, then, the effect of the order appointing the Official Trustee sole trustee in the place of Silas Elias Ezra --as to the trusts created by the Will of David Joseph Ezra--the Plaintiff urges that, assuming the mortgage in suit forms part of the trust estate last mentioned, the rights created by the personal covenants of the mortgage never becomes vested in the Official Trustee--that these rights and all claims and demands thereunder by virtue of the grant of administration descended to her as the personal representative of the mortgagee.

Sec. 10 of the Official Trustees Act provides that upon the appointment of the Official Trustee to be the Trustee of any property, "such property shall vest in the Official Trustee and his successors in office and shall be held by him and them upon the same trusts as the same were held previous to such appointment." Sec. 34 of the Trustees'' and Mortgagees'' Powers Act also provide that "the Official Trustee may with his consent be appointed under this section in any case in which only one trustee is to be appointed, and such trustee is to be the sole trustee." The order on the face of it purports to be made under the provisions of the Official Trustees Act, and I must take it that it was so made. Looking to the circumstances of the case and the terms of sec. 34 of the Trustees'' and Mortgagees'' Powers Act and sec. 10 of the Official Trustees Act it seems to me that the Court had the power to make the appointment under either section, but the question under which of these Acts the appointment was made seems to me of small practical importance because in my opinion the effect of the appointment must be determined according to the provisions of the Official Trustees Act.

What then is the "property, " which is affected by the appointment of the Official Trustee, and what is the effect of the vesting of "such property" in the Official Trustee.

It is said that the "vesting of property" under the provisions of the Official Trustees Act cannot have the wide and complete sense, which under the express language of the legislature is attributed to these words in the Indian Trustee Act which was passed two years later. By this Act an order of the Court vesting immoveable property in a new Trustee is expressly declared to have the effect as if the former Trustee who has become incapable of acting "had duly executed a conveyance of the property in the same manner and for the same estate." This language is not employed to describe the effect of the vesting when the property concerned is "stock, Government securities or anything in action." See sec. 6 of the Act, though the legal effect of such vesting is expressly stated in sec. 26. But I do not think that considerations of this kind would justify the Court in giving a limited and restricted effect to the vesting of property under the Official Trustees Act. To adopt such a course would be to render the Act ineffective and prevent the accomplishment of the real purpose and object which the legislature had in view.

The main purpose of the Act was, it seems to me, to place the Official Trustee and his successors in office in the same position, and vested with the same powers, as the persons who held the property in trust previous to the appointment of the official trustee. It was intended that this effect should be given to the appointment at once and for all purposes and without the necessity of employing any formality and so as to enable the Court to make such orders as might be necessary to effectually deal with the entire trust estate. See secs. 15 and 17 of the Act. If this be the purpose of the Act, it is obvious that a wide meaning must be given to the words "property" and "vest."

"Property" was, I think, meant to include not merely moveable and immoveable property of a tangible kind but also chooses in action or actionable claims, and the vesting of such property in the Official Trustee was intended to have the effect of giving the Official Trustee by virtue of his appointment complete power of enforcing all claims or demands in respect of the trust estate.

Assuming then that the mortgage debt and security was in fact property subject to the trust created by the Will of David Joseph Ezra the right of enforcing that mortgage and recovering the money due thereunder became vested in the Defendant the Official Trustee on his appointment as Trustee by the order of 12th July 1897. The remaining question is one of fact-- was the mortgage money part of the fund of lis. 70, 000 dealt with by the Will of David Joseph Ezra ? There is an order to this effect by the Court and the order appointing the official trustee deals with it as such. But this finding was arrived at in proceedings to which the Plaintiff was no party and is therefore not binding on her. The Official Trustee is prepared to give evidence to establish the fact and asks to be permitted to do so, and I think I am bound for the purpose of effectually dealing with the issue which has been raised in this case to admit this evidence.