Module 5,6,16
Module 5,6,16
- Khyati Nayak
CONTENT OUTLINE
MODULE 5
Basic Principles Governing Transfer
Understanding the following principles governing transfer such as:
What May be transferred ?
Who is competent to transfer ?
Sections Referred: Section 6 and 7, 8, 9
MODULE 6
Doctrine of feeding the grant by estoppels
Understanding the doctrine of feeding the grant by Estoppel
Sections Referred: Section 43
MODULE 16
Coparcenary, Joint and Co – Ownerships
Understudying the concept of Coparcenary, Joint and Co – Ownerships and law governing the same.
Sections Referred: Sec. 44 – 47of the Transfer of Property Act, 1882
BASIC PRINCIPLES GOVERNING TRANSFER
In this section “living person” includes a company or association or body of individuals, whether
incorporated or not, but nothing herein contained shall affect any law for the time being in force relating
to transfer of property to or by companies, associations or bodies of individuals.
ESSENTIALS OF VALID TRANSFER:
Transferability of property (Section 6)
What may be transferred.—Property of any kind may be transferred, except
Manner (Section 9)
Oral transfer.—A transfer of property may be made without writing in every case in which a writing is not expressly required by law.
WHAT KIND OF PROPERTY CAN BE TRANSFERRED
(TRANSFERABILITY)
(Section 6)
What may be
transferred ?
WHAT CAN BE TRANSFERRED…
( SECTION 6)
Section 6 of the transfer of property act deals with the concept of what may be transferred.
PROPERTY OF ANY KIND… Property of any kind may be transferred, except as otherwise provided by this act or even by any other law for time being
in force.
●Property – Rights/intrest
●Property – used in widest possible sense
●All rights and legal interests which man has in land & Chattels to the exclusion of others. All rights and legal interests which a man can possibly possess.
The very transferability of the property is based on the maxim ‘alienation rei prefertur juri accrescendi’, and the meaning of the maxim goes
like this– Law favours alienation to accumulation.
Exceptions…
The exceptions will be discussed in detail in the following sub-sections.
SUB-SECTION(A)- TRANSFER OF SPES SUCCESSION
Section 6 (a) –
I. The chance of an heir-apparent succeeding to an estate,
II. The chance of a relation obtaining a legacy on the death of a kinsman, or
III. Any other mere possibility of a like nature, cannot be transferred;
A mere chance of succession/ mere possibility
No present interest/ only a chance that he may succeed the property in future
For Example - A family consists of father F and son S, F being the owner of the property has the ownership with him
during his lifetime and no one else including his son is allowed to sell the property, without his consent. Now, if F dies
intestate, s would inherit his property and hence, here it can be said that S is the Heir Apparent.
Here S’s succession to the property in the future is a chance due to two main reasons.
Firstly, As F is the owner of the property he may sell it, dispose of it in any manner he thinks or make a will in someone else’s favour.
Eventually, nothing will be left for S.
Secondly, son S dies during the lifetime of his father. Thus, if S during the lifetime of his father transfers the property without his father’s
consent then the transfer would be void ab initio and is also expressly prohibited by the act.
Lord Bacon laid down this rule as –
The Law doth not allow of grants except there be a foundation of an interest in the grantor;
For the law will not accept grants or titles of things in action which are imperfect interest;
Much less will it allow a man to grant or encumber that which is no interest at all, but merely future.
The right of re-entry means the right to resume the possession of the land which would have been given to some other
person for a certain period of time.
And the cases of re-entry are usually seen in the cases of leases, which would empower the lessor (OWNER) to re-enter upon
the demised premises if the rent is in arrear for a certain period or if there is a breach of covenants in the lease.
Re Davis and Company, in this case, A purchased certain goods from B, which was on a hire purchase agreement.
This agreement contained a clause which was that after purchase, A would take the property and would also pay the
instalments on time, and in case A fails to pay the instalments B would enter A’s premise and take the possession of the
property.
The important point to be noted here is that the right to Re-enter is a personal right of B and the same cannot be transferred
by him, and in any case, if he transfers this right to entry, to his creditors or anyone, then the same would be void.
An easement can be quoted as a right which the owner or the occupier of certain land has in his
possession for the beneficial enjoyment of the said land, or it may even be to do, or to continue to
do something or to prevent something from being done.
Example: Where A as an owner has the right of way over the way of the land of another for
purposes which are connected with the beneficial use of his own land then, this can be termed as an
easement.
It should also be noted that an easement cannot be transferred apart from the dominant heritage to
which by the nature of the right it is attached, and this was held in the case of Sital v. Delanney.
Bhagwan Sahai v., Narshingh Sahai, 31 All 612
Realease of easement in favour of owner
Section 38 of the Easements Act states that an easement is extinguished when the dominant owner releases it, expressly or impliedly
to the servient owner.
An extinguishment of easement by the dominant owner by assigning or releasing the same in favour of the servient owner is not hit
by Section 6(c) of the Act.
What Section 6(c) of the Act prohibits is a transfer of easement apart from the dominant tenement by the dominant owner to a
person not being the servient owner.
SUB-SECTION (D)- RESTRICTED INTERESTS
(d) All interest in property restricted in its enjoyment to the owner personally cannot be transferred by him;
This clause states that a person cannot transfer anything which is interest restricted in its enjoyment to him.
For example- Two brothers partition a property among themselves and in addition give a right of
pre-emption, which means one of them if at all wants to sell the property should first offer it to the other
brother, who would be preferential in buying it.
Here it should be known that these rights are personal rights and cannot be transferred.
But it should, however, be noted that the right to receive offerings which are made at a temple is
independent of on obligation to perform services which would involve qualifications of personal
nature, and such rights are transferable. (Mahamaya v. Haridas)
SUB-SECTION (DD)- RIGHT TO FUTURE
MAINTENANCE
(dd) A right to future maintenance, in whatsoever manner arising, secured or determined, cannot be
transferred;]
The sub-section of maintenance, it has been established that a right to future maintenance is solely for the
personal benefit of the person to whom it has been granted and therefore, this very right cannot be
transferred further.
Thus an example can be quoted here regarding the rights of a woman to either receive maintenance
from her husband under a decree or award of the court.
This right can neither be transferred nor can it be attached by a court’s decree.
And this was held in the case of Dhupnath v. Ramacharit.
It was in the landmark case of Sethupathi v. Chidambaram, where it was held that a mere right to sue is something which cannot be
transferred.
Here the word ‘mere’ itself means that the transferee has developed no interest than just a bare right to sue.
For Example- A contracts to buy goods from B On due date A fails to take delivery and B sells the goods in the market at a loss of
Rs.10000. B transfers the right to recover the damages to C. The transfer is invalid.
It should be noted in the first place that a public officer cannot be transferred.
In the same fashion, even the salary of the police officer cannot be transferred whether before or after it becomes
payable.
The word public officer is meant to be someone who has been appointed to discharge a public duty, and in turn,
receive a monetary return of it which is in the form of the salary.
Here, as the salary becomes something which is given on return of the personal service of a person.
MSM Railways v. Rupchand, AIR 1950 Bom 155
it can neither be transferred or attachable.
In the case of Ananthayya v. Subba Rao AIR 1960 Mad 188, it was held that where there is an agreement
between two people and according to which a person agreed to pay a certain proportion of his income to his
brother in consideration of his having been maintained by the latter, now in such cases this provision will not be
applicable, which was held by the court.
SUB-SECTION (G)- PENSIONS
Stipends allowed to military [naval], [air-force] and civil pensioners of the [Government] and political
pensions cannot be transferred;
Pension is like a salary, it is a sum of money periodically payable by the government which can be to an
ex-serviceman or to a person who has ceased to be in employment.
In the case of Saundariya Bai v. Union of India , it was held that pension is non-transferable, so long as it is
unpaid and in the hands of the government.
Another important aspect which should be taken into consideration is that pension is different from bonus and
rewards, and also, on the contrary, these are transferable.
SUB-SECTION (H)- TRANSFER
OPPOSED TO NATURE OF INTEREST
(h) No transfer can be made (1) in so far as it is opposed to the nature of the interest affected thereby, or (2) 6[for
an unlawful object or consideration within the meaning of section 23 of the Indian Contract Act, 1872 (9 of 1872)], or
(3) to a person legally disqualified to be transferee;
1. No transfer can be made insofar as it is opposed to the nature of the interest affected thereby.
1. Thus, the things which are dedicated to public or religion uses or service inam, cannot be transferred.
1. Anjaneyulu v. Srivenugopal 45 Mad 620
2. Transfer for Unlawful object or Consideration – Any transfer which is for an unlawful object or consideration is
not permissible under this section. And it is also in consonance with section 23 of the Indian Contract Act, which
provides that consideration or object is unlawful if
1. Is Fraudulent
2. It is opposed to public policy
3. It is forbidden by law.
4. Is of such a nature that it defeats the provisions of any law.
This section makes it clear that a tenant having an un-transferable right of occupancy cannot in any way transfer his interest,
and this was held in the case of Shanti Prasad v. Bachchi Devi.
This clause even contains an exception to the general rule which says that all tenancies or leaseholds are transferable. It gives
effect to different enactments whereby it says certain categories of leasehold interests or tenancies are made
non-transferrable.
Similarly, where a farmer of an estate, in respect of which default has been made in paying revenue, cannot assign his interest
in the holding.
(Section 7)
COMPETENCY Who can transfer
(PERSONS COMPETENT TO TRANSFER)
property ?
COMPETENCY (SECTION 7)
7. Persons competent to transfer.—
1. Every person competent to contract and
2. entitled to transferable property, or
3. authorised to dispose of transferable property not his own,
is competent to transfer such property either wholly or in part, and either absolutely or conditionally, in the
circumstances, to the extent and in the manner, allowed and prescribed by any law for the time being in force.
●Person must be competent to contract
○ Raja Balwant Rao V. Rao Maharaj Singh 34 All 296
8. Operation of transfer. —
Unless a different intention is expressed or necessarily implied, a transfer of property passes forthwith to the
transferee
all the interest which the transferor is then capable of passing in the property and
in the legal incidents thereof.
LEGAL INCIDENTS OF TRANSFER
Such incidents include, where the property is land, the easements annexed thereto, the rents and profits
thereof accruing after the transfer, and all things attached to the earth;
and, where the property is machinery attached to the earth, the moveable parts thereof;
and, where the property is a house, the easements annexed thereto, the rent thereof accruing after the
transfer, and the locks, keys, bars, doors, windows and all other things provided for permanent use
therewith;
and, where the property is a debt or other actionable claim, the securities therefor (except where they are
also for other debts or claims not transferred to the transferee), but not arrears of interest accured before
the transfer;
and, where the property is money or other property yielding income, the interest or income thereof
accruing after the transfer takes effect.
The Rule is :
Joseph Parker Camp, Appt., v. Kate Willard Boyd, 1913 SCC OnLine US SC 203 : 229 US 530 (1913)
The rule at law is that by a grant of the reversion, the rent reserved will pass; but they by a grant of the rent, the
reversion will not pass.
‘The incident, accessory, appendant, and regardant, shall in most cases pass by the grant of the principal, without
the words cum pertinentiis, but not e converse; for the principal doth not pass by the grant of the incident,
etc. Accessorium non ducit, sed sequitur, suum principale.’
The list whether exhaustive ?
In, Rajendra v. Chinhathambi Gounder AIR 2007
43. Transfer by unauthorized person who subsequently acquires interest in property transferred.—
1. Where a person fraudulently or erroneously represents that he is authorised to transfer certain immoveable property
2. and professes to transfer such property for consideration,
3. such transfer shall, at the option of the transferee, operate on any interest which the transferor may acquire in such
property at any time during which the contract of transfer subsists.
Nothing in this section shall impair the right of transferees in good faith for consideration without notice of the existence of the said
option.
Illustration : A, a Hindu who has separated from his father B, sells to C three fields, X, Y and Z, representing that A is
authorised to transfer the same. Of these fields Z does not belong to A, it having been retained by B on the partition;
but on B’s dying A as heir obtains Z. C, not having rescinded the contract of sale, may require A to deliver Z to him.
SECTION
(ANALYSIS)
43
Where, Transfer is :
Based on representations
(a) Fraudulent (inserted in 1929), or
(b) erroneous representation;
There is representations;
as to the authority to transfer; and
Professes to transfer,
For consideration,
On any interest the transferor acquires subsequent thereto at any time, (Subsequent Acquisition)
3. Subsequent Acquisition
No estoppel if no subsequent acquisition of property
Sec. 43 : Transfer by unauthorized person who subsequently acquires interest in property transferred
4. Transferee’s Option
The section enables the transferee to claim interest and does not provide that the interest shall
vest in transferee from the date of subsequent acquiring of interest.
So, Later transferee must use or demand the option forthwith. The transferee defrauded earlier
has to be vigilant. He must keep track of the subsequent acquisitions.
If the demand is late and meanwhile the transferor gives the property to third party who is
bonafide purchaser for value without notice, the right of first transferee ends.
UNDERLYING PRINCIPLE
Principle : Equity treats as done which ought to be done.
(A man who has promised more than he can perform, must make good to the contract when he
acquires the power of performance.)
If a person, who alienated property to which he has no present title, many subsequently become
entitled to, he must honor his commitment. Since he can not derogate from his own grant, his
subsequently acquired interest, feeds the Estoppel, raised by the prior grant and perfects the title
of the alienee.
(Rule of Estoppel under English Law) The common law rule of Estoppel is :
“Where a grantor has purported to grant an interest in land which he did nor, at the time,
possess, but subsequently acquires, the benefit of his subsequent acquisition goes automatically to
the earlier grantee, or as it is usually expressed, feeds the Estoppel.”
FEEDING OF GRANT BY ESTOPPEL
Ramdeo and another v. Dy. Director of Consolidation, AIR 1968
A man who has promised more than he can perform, must make good to the contract when he acquires the power of performance.
Aalamanaya Kunigari Nabi Seb v. Marukuti Papiah, AIR 1915 Mad 972
Mortgage of specs succession (property of father by son)
During pendency of suit father died
Contention by son - Interpretation of section 43 is violative of section 6(a) – Rejected by court
The transferor's right to joint possession or other common or part enjoyment of the property,
and to enforce a partition of the same,
but subject to the conditions and liabilities affecting, at the date of the transfer, the share or interest so
transferred.
Where the transferee of a share of a dwelling-house belonging to an undivided family is not a member of the family,
nothing in this section shall be deemed to entitle him to joint possession or other common or part enjoyment of the house.
45. JOINT TRANSFER FOR
CONSIDERATION.—
Where immoveable property is transferred for consideration to two or more persons
In the absence of evidence as to the interests in the fund to which they were respectively entitled, or as to the
shares which they respectively advanced,
such persons shall be presumed to be equally interested in the property.
46. TRANSFER FOR CONSIDERATION BY
PERSONS HAVING DISTINCT INTERESTS.—
Where immoveable property is transferred for consideration
by persons having distinct interests therein,
the transferors are, in the absence of a contract to the contrary,
entitled to share in the consideration equally, where their interests in the property were of
equal value, and,
where such interests were of unequal value, proportionately to the value of their respective
interests.
Illustration
(a) A, owing a moiety, and B and C, each a quarter share, of mauzaSultanpur, exchange an eighth share of that mauza for a quarter share of mauzaLalpura. There
being no agreement to the contrary, A is entitled to an eighth share in Lalpura, and B and C each to a sixteenth share in that mauza.
(b) A, being entitled to a life-interest in mauzaAtrali and B and C to the reversion, sell the mauza for Rs. 1,000. A's lifeinterest is ascertained to be worth Rs. 600, the
reversion Rs. 400. A is entitled to receive Rs. 600 out of the purchase-money. B and C to receive Rs. 400.
47. TRANSFER BY CO-OWNERS OF SHARE IN
COMMON PROPERTY.—
Where several co-owners of immovable property
transfer a share therein
without specifying that the transfer is to take effect on any particular share or shares of the
transferors,
the transfer, as among such transferors,
takes effect on such shares equally where the shares were equal,
and where they were unequal, proportionately to the extent of such shares.
Illustration
A, the owner of an eight-anna share, and B and C, each the owner of a four-anna share, in mauzaSultanpur, transfer a two-anna
share in the mauza to D, without specifying from which of their several shares the transfer is made. To give effect to the transfer
one-anna share is taken from the share of A, and half-an-anna share from each of the shares of B and C.
KHYATI NAYAK
Assistant Professor (Law)
KPMSOL, NMIMS, MUMBAI
Email : [email protected]