Transfer of Property pending suit related thereto
The doctrine embodied in Section 52 of Transfer of property Act, is based on the English Common Law Legal Maxim “Pendete Lite Nihil Innovature” i.e. “during litigation no new rights should be introduced”.
“LIS” means – an action or a suit and “PENDENS” means – continuing or pending. Therefore the term “LIS-PENDENS” literally and collectively means – a pending suit.
The doctrine of Lis-Pendens has been defined as “the jurisdiction, power, or control which a court acquires over a property involved in a suit pending the continuance of the action, and until the final judgement therein.”
This is considered to be a general rule which seems to have been recognized in all regular system of Jurisprudence.
Lord Turner in a case aptly explained the importance of this doctrine. – It is a doctrine common to the courts of both i.e. the court of law as well as court of equity, and rests upon the foundation that it would plainly be impossible that any action or suit could be brought to a successful termination, if alienation pendete lite were permitted to prevail.1
CONCEPT as per the provision
Section 52 when analysed shows that it is in two parts. The first part lays down the conditions for the applicability of the doctrine and the second part lays down what are the effects of this doctrine.
The conditions for the applicability of the doctrine are:
- That a suit or proceeding should be pending.
- That it should be collusive.
- That it should be a suit or proceeding in which any right to immovable property is directly and specially in question.
- That the court trying the case should be having the jurisdiction of the same.
If these conditions mentioned above are fulfilled, then the doctrine applies. The effect of the section indicated in the latter half of the section are as follows:
- That the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding.
- That such a transfer is barred by this section but the court has been given the authority to allow or permit this transfer by virtue of this provision itself.
ESSENTIAL CONDITIONS FOR APPLICATION OF THE SECTION
PENDENCY OF SUIT
For the application of this doctrine, the concerned suit must be in pendency i.e. it must be pending for adjudication before the court. Now, the question that needs to be answered is that during what period/s of the suit, it is said to be pending. Any suit is considered to be pending for the period during the following stages:
- Presentation of Plaint/Institution of Proceedings
- Final Decree/Order
- Complete Satisfaction/Discharge of Decree
- Time period of Appeal
Prior to the amendment in 1929, the words, “contentious” and “active prosecution” were used in the section which led to conflicting decisions. After the amendment, these words were omitted and explanation was added which made it clear that pendency starts from the very institution of sit or presentation of plaint.
It was laid clearly in a case that a suit is commenced by the filing of the plaint and appeals and Execution proceedings are a continuation of the suit.
COMPETENCY OF COURT
Another essential condition for the doctrine’s application is that the court that s trying the said suit must be of competent jurisdiction.
The competency of a court is decided on 3 counts:
- Territorial Jurisdiction
- Pecuniary Jurisdiction
- Subject-Matter Jurisdiction
It was observed in a case that where a plaint is presented to a court having no jurisdiction, and the court returns the plaint to be presented to a competent court.2
The pendency would commence from the date on which the plaint is presented to another court having proper jurisdiction.
SUIT OR PROCEEDING MUST NOT BE COLLUSIVE
A suit is collusive if it is instituted with malafide intention. Malafide intention behind instituting a suit is referred from the fact that parties to the suit know their respective rights in the property and there is no actual dispute.
Such a suit is therefore, fictitious and the very purpose of such suit is to get judicial decision for some evil design e.g. defrauding a party.
The Supreme Court said that “In such (collusive) proceedings the claim put forward is fictitious, the contest over it is unreal, and the decree passed therein is a mere mask having similitude of a judicial determination and worn by the parties with the object of misleading confounding third parties.3
A RIGHT TO IMMOVABLE PROPERTY MUST BE IN QUESTION
It is another necessity for the application of this doctrine that an immovable property must be involved and it must be directly and specifically in question. This means that the litigation should be regarding title or interest in an immovable property.
A suit which is based on a mortgage and in which a money decree is given, is not as long as the decree stands unreversed, subject to the rule of Lis Pendens because in such a case no right to immovable property is directly or substantially in question.
During the pendency of the suit, the property must be transferred or otherwise dealt with by any of the parties to the suit.
Hereby, – “Transferred” refers to the alienation made by way of sale, mortgage, lease or exchange.
On the other hand, – “Otherwise dealt with has been interpreted to mean those transaction in which although there is transfer of some interest in the property but they do not come strictly within the meaning of ‘Transfer of Property’ as defined under section 5 of the act.
Lastly, the TRANSFER MUST AFFECT THE RIGHTS OF ANY OTHER PARTY TO THE SUIT
Section 64 of the Civil Procedural Code in India has been worded in the same lines as contained in the doctrine of Lis Pendens under section 52. It should be noted that both the sections contain the same doctrine but their operative part is directed to slightly different situations.
1 (1857) I D&J566
2 Second appeal no. 217 of 1937
3 1959 SCR 629
Author: Shivam Srivastava,
School of Law, IIMT - 4th year