TMI Blog1966 (9) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... g that the land was agreed to be sold by appellants 1 2 to the respondent and that ₹ 1006/- were received as advance amount. On March 31, 1959 Palaniappa Pillai was convicted of the offence of murder and sentenced to imprisonment for life. On April 4, 1959 appellants 1 2 received ₹ 2,000/- from the respondent and executed a writing stipulating that the sale deed will be executed on or before April 15, 1959. It was recited in that writing that appellants 1 2 had agreed to sell on March 5, 1959 and had received ₹ 1006/- on that date, and ₹ 2,000/- on April 4, 1959 and it was further recited that appellants 1 2 shall settle the aforesaid sale within 2nd Chittiral, Vikhari (15th April 1959) in favour of the respondent that the amount shall be paid as per the particulars of the receipt of sale consideration; that even though appellants 1 2 are prepared to settle the sale accordingly, if the respondent raises any objection whatever to settle the sale, he shall lose the advance amount of ₹ 3006/-(Rupees Three thousand and six only); and that, even though the respondent is prepared to settle the sale, if appellants 1 2 raise any object ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that he was ready and willing to carry out his part of the contract, and the respondent called upon appellants 1 2 to execute a sale deed within three days of the receipt of the letter against payment of the balance of the price. He also offered to purchase the stamp paper and to have the sale deed prepared for execution. 3. Appellants 1 2 having failed to execute the sale-deed the respondent instituted original suit No. 30 of 1959 in the Court of the Subordinate Judge, Ramnathapuram, against appellants, 1, 2 3 and one Sethuramalingam Pillai (who was impleaded on the ground that he has a mortgagee of the property by deed executed on September 15, 1952 for ₹ 6000/-) for a decree for specific performance of the agreement, alleging that he was at all material times ready and willing to perform his part of the contract and to obtain the sale deed and it was only at the request of appellants 1 2 that execution of the sale deed was twice postponed and that appellants 1 2 had committed breach of the contract. The suit was resisted by appellants 1, 2 3. The learned Trial Judge dismissed the suit holding that under the agreements dated April 4, 1959 and April 15, 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the promise if the intention of the parties was that time should be of the essence of the contract . 6. It is not merely because of specification of time at or before which the thing to be done under the contract is promised to be done and default in compliance therewith, that the other party may avoid the contract. Such an option arises only if it is intended by the parties that time is of the essence of the contract. Intention to make time of the essence, if expressed in writing, must be in language which is unmistakable : it may also be inferred from the nature of the property agreed to be sold, conduct of the parties and the surrounding circumstances at or before the contract. Specific performance of a contract will ordinarily be granted, notwithstanding default in carrying out the contract within the specified period, if having regard to the express stipulations of the parties, nature of the property and the surrounding circumstances, it is not inequitable to grant the relief. If the contract relates to sale of immovable property, it would normally be presumed that time was not of the essence of the contract. Mere incorporation in the written agreement of a clause im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubstance intended as regards the time of its performance may be excluded by any plainly expressed stipulation. But to have this effect the language of the stipulation must show that the intention was to make the rights of the parties depend on the observance of the time limits prescribed in a fashion which is unmistakable. The language will have this effect if it plainly excludes the notion that these time limits were of merely secondary importance in the bargain, and that to disregard them would be to disregard nothing that lay as its foundation. Prima facie, equity treats the importance of such time limits as being subordinate to the main purpose of the parties, and it will enjoin specific performance notwithstanding that from the point of view of a Court of Law the contract has not been literally performed by the plaintiff as regards the time limit specified. 8. The Trial Court relied upon three circumstances in support of its conclusion that time was of the essence of the contract of sale : (i) though no time was prescribed by the oral agreement, in the agreements writing dated April 4, 1959 and April 15, 1959 there were definite stipulations fixing dates for performance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. But the respondent has claimed a decree for specific performance and it is for him to establish that he was, since the date of the contract, continuously ready and willing to perform his part of the contract. If he fails to do so, his claim for specific performance must fail. As observed by the Judicial Committee of the Privy Council in Ardeshir Mama v. Flora Sasson I.L.R. 55 IndAp 360 : In a suit for specific performance, on the other hand, he treated and was required by the Court to treat the contract as still subsisting. He had in that suit to allege, and if the fact was traversed, he was required to prove a continuous readiness and willingness, from the date of the contract to the time of the hearing, to perform the contract on his part. Failure to make good that averment brought with it the inevitable dismissal of his suit. 10. The respondent must in a suit for specific performance of an agreement plead and prove that he was ready and willing to perform his part of the contract continuously between the date of the contract and the date of hearing of the suit. On this part of the case the Trial Court recorded a clear finding against the respondent that he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would get possession only later and the sale deed would be executed after his return . The trial Court considered the plea that the respondent was not ready and willing to perform his part of the contract on the footing that time was not of the essence. The Court referred to the admission made by the respondent that he was not willing to take the sale deed on April 30, 1959, and then considered the question whether the sale was not completed by April 30, 1959 on account of default on the part of the respondent or of appellants 1 2. On a consideration of the evidence, the Trial Court came to the conclusion that the respondent was not ready to complete the sale by April 30, 1959, since he wanted time for consulting his lawyer as to the desirability of obtaining attestation of the children of appellant No. 1 in the proposed sale deed and that appellants 1 2 did not ask for postponement. The Trial Court then proceeded to consider whether default was committed by the respondent or by appellants 1 2, and observed that mere assertion in the plaint that he was ready and willing to perform the contract was not sufficient and his readiness and willingness had to be judged from what he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court inferred from the delay of three months after April 30, 1959 and the evidence given by the respondent to explain that delay and other circumstances. 15. The Trial Court expressly recorded a finding on issue No. 2 adverse to the claim of the respondent. The respondent had, as already observed, claimed that he was ready and willing to perform his part of the contract and appellants 1, 2 3 had denied that claim. Before he could be awarded a decree for specific performance, the respondent had to prove his readiness and willingness continuously from the date of the contract till the date of hearing of the suit and if he failed in that, his suit was liable to fail. And the Trial Court dismissed the respondent's suit on that ground also. The High Court could grant a decree for specific performance in favour of the respondent against appellants 1 2 only if the Court was satisfied that the respondent was continuously ready and willing to perform his part of the contract from the date of the suit till the date of hearing. But the respondent in the High Court did not apparently challenge the finding of the Trial Court on that question against the respondent. He merely invi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the inference raised by the Trial Judge on the second issue, insofar as it relates to the readiness and willingness for the respondent to perform his part of the contract, could not be raised on the findings recorded by him. The respondent had stated that he was on April 30, 1959 not ready to purchase the stamp-paper or to take the sale deed. After April 30, 1959 also according to the Trial Judge the respondent took no steps to call upon appellants 1 2 to perform their part of the contract, and did not purchase the stamp paper. The Trial Judge also found that the story of the respondent that appellant No. 1 requested that completion of the sale be postponed because he had to attend a social function at Madurai and thereafter he had to go about making enquiries for a suitable match for his grand-daughter, and that in the first week of July 1959 appellant No. 1 and the respondent went to V. Pillai P.W. 3 for preparation of the draft sale-deed and that the first appellant requested for time to get the attestation of his son and daughters, was not true, and that the respondent was attempting to throw blame for the delay on appellants 1 2 and was trying to invent excuses to expla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent instituted the present suit. 20. The High Court repelled the contention that the relief of specific performance was barred by delay. The appellants no longer urge that the respondent was disentitled to relief on the ground of delay. Counsel for the appellants took the new point that the respondent was not ready and willing to perform his part of the contract and his suit should be dismissed on this ground. I find no trace of this argument in the judgment of the High Court. Before the High Court, the present appellants urged two points only, viz., (a) time was of the essence of the contract and therefore the respondent was guilty of breach of contract and (b) in any event, the respondent was not entitled to relief on the ground of delay. The High Court rejected both these contentions. The appellants did not rely upon the finding of the trial Court that the respondent was not ready and willing to perform the contract. If the appellants relied on this finding, the High Court would have suitably dealt with it. The High Court could not have decreed the suit for specific performance without finding that the respondent was at all material times ready and willing to perform the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant being, as found by the trial Court, which, as we said, is not contested before us, a defaulting party, he is entitled to a decree for specific performance. That would depend upon whether there was undue delay on the part of the appellant and whether respondents 1 and 2 have given him reasonable notice that he must complete the agreement within a definite time. 23. The effect of these admissions is this : If the time was of the essence of the contract, the respondent had defaulted on April 30, 1959. But if the time was not of the essence of the contract, he had committed no breach of contract and the only question then was whether he could be refused relief of specific performance on the ground of delay. It is no longer contended that the respondent is disentitled to relief on the ground of delay. As the time was not of the essence of the contract, it was the duty of the appellants to give to the respondent a notice fixing a reasonable time for the completion of the sale. They did not do so. Instead of fixing a reasonable time for the completion of the sale, they wrongfully cancelled the contract by their letter dated July 31, 1959. There was undoubtedly delay on the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration money was ₹ 15,106/-. On March 5, 1959, the respondent made an advance deposit of ₹ 1,006/-. On April 4, 1959, he made another deposit of ₹ 2,000/-. As soon as he received the letter dated July 30, 1959, he deposited the balance sum of ₹ 13,906/- in a bank. Counsel urged that before July 30, 1959 the respondent should have been ready with the money. There is no force in this contention. In Bank of India Limited v. Jamsetji A.H. Chinoy and Messrs. Chinoy and Company I.L.R. (1949) IndAp 76., the Privy Council decreed specific performance of the contract to sell shares. On the question of readiness and willingness of the buyer to perform the contract, Lord MacDermott observed at p. 91 of the Report : It is true that the first plaintiff stated that he was buying for himself, that he had not sufficient ready money to meet the price and that no definite arrangements had been made for finding it at the time of repudiation. But to prove himself ready and willing a purchaser has not necessarily to produce the money or to vouch a concluded scheme for financing the transaction. 27. In my opinion, the respondent is entitled to specific performance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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