TMI Blog1928 (8) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... of Tiruthuraipundi. On appeal by defendant 2, the learned Subordinate Judge of Tanjore set aside the -decree so far as it affected him and this decree was confirmed by Wallace, J. It was alleged in the plaint that when defendant 1 did not pay the amount within the three months' time, information was given to defendant 2 and when he was asked to have the aforesaid promissory note assigned in his name he did not pay the money. This allegation was denied by defendant 2 in his written statement. As there was no clear finding as to which party was responsible for the breach of the conditions in Ex. B-1, the learned Judge before deciding the case called upon the lower appellate Court to submit a finding on the following issues: Has there been any breach of the contract set out between the plaintiff and defendant 2 in Ex. B-l? And if so, which of these two parties is responsible for that breachs. 3. The finding submitted was that defendant 2 was called upon by the plaintiff to pay the amount under Ex. B and to take over the promissory note; but that he failed to do so; and that defendant 2 is solely responsible for the breach of the contract in Ex. B-l. This finding was not chal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n regarding the assignment of the promissory note on payment of the money is only a statement in express language of the rights and obligations of a creditor and surety implied under Section 141, Contract Act, and nothing more. It is true that on payment of the money by defendant 2, the plaintiff is bound to assign the promissory note to him and if he does not do so, the surety is discharged from his liability. But the finding on this point is clearly against defendant 2. Since the default was on his part, he cannot escape the surety's liability of paying the debt which he had undertaken under Ex. B-l. It therefore follows that defendant 2 is equally liable with defendant 1 for the suit amount and when he makes the payment, by having recourse to Section 140, Contract Act, he will have his remedy against defendant 1. 6. In the view that I have taken viz., that the suit against defendant 2 is for the enforcement of his liability as a surety under Ex. B-l and not for the specific performance of a special contract contained in it, it is not necessary to examine the decision in Jatindra Nath Basu v. Payer Daye Debi A.I.R. 1916 P.C. 147, relied on by Mr. Ramachandra Ayyar. I may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Defendant 2 was impleaded as surety for defendant 1 in respect of the said debt, under an agreement in writing (Ex. B-1), executed by him in plaintiff's favour on the same date as Ex, B. In that agreement defendant 2 after referring to the pronote (Ex. B) executed by defendant 1 in plaintiff's favour, says that the said defendant 1. will repay the principal and the interest amount thereof within three months time. If he does not so pay, I shall have the note assigned to my name and pay you the principal and interest. 10. The facts found in the case are that defendant 1 did not repay to the plaintiff the amount due under Ex. B within three months or subsequently. The plaintiff thereafter called upon defendant 2 several times for payment of the amount due under Ex. B offering to assign the pronote to him on such payment. But defendant 2 did not comply with the demand as he was bound to do and he thereby committed a breach of the agreement (Ex. B-1) for which he must be held responsible to the plaintiff. Upon these findings the trial Court passed a decree against both defendants for the amount claimed. Defendant 2 alone appealed against that decree, his main ground bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e part of defendant 2, the plaintiff cannot have any relief against him in this suit as framed. He says that the plaintiff cannot ask for a decree against defendant 2 for the amount due under the suit note Ex. B 1 because he can no longer perform the correlative obligation of assigning the said pronote to defendant 2. His only remedy is to sue defendant 2 for damages for the breach of the agreement Ex. B 1 but those damages cannot be assessed and decreed in this suit as the amount of damages will depend upon what amount the plaintiff is unable to recover in this suit from defendant 1. The plaintiff will have to recover that amount, if necessary, in a separate suit. In that view the learned Judge dismissed the second appeal. 12. The learned Advocate General who appears for the appellant contends that, upon the finding that the breach of the agreement Ex. B 1 was on the part of the defendant, the plaintiff is entitled to a decree in this suit as against defendant 2 also as surety for the principal debtor. He argues that under the terms of Ex. B 1 the only restriction imposed in respect of the concurrent liability of the surety (defendant 2) with the principal debtor, (defendant 1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the institution of the suit, the execution of the decree had become barred by limitation and the decree became, in the language of their Lordships, a dead decree. Their Lordships held on that ground that the agreement was incapable of performance owing to the default on the part of the plaintiff in not keeping the decree alive, as what they have to transfer under the agreement was a decree capable of being executed and not a dead decree. That case has no application to the present. The transaction in that case was one of sale of a decree, the sole consideration for the payment of the price being the assignment to the purchaser of an enforceable decree. When the decree ceased to be enforceable owing to the negligence or default on the part of the vendors, the consideration for the purchase wholly failed. But the transaction in this case is of a different nature. It is based on defendant 2 standing as surety for the debt due by defendant 1. The real consideration for the transaction was the money lent to defendant 1 on the faith of the guarantee. In the absence of any express contract between the surety and the creditor, the liability of the surety will be co-extensive with that ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
