9911796707
TMI Blog1887 (3) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... d Bahim Shirazee. A suit which had been brought by the Shoostry family against the original executor for an account was revived in 1834 against Mahomed Bahim Shirazee, and, in 1846, the Master in Equity, by his report, found Mahomed Bahim Shirazee liable to the estate for over 11 lacs. This report was confirmed by the Supreme Court, and a decree passed on the 17th of September, 1847, directing Mahomed Bahim Shirazee to pay the said amount. On appeal, however, to the Privy Council, in 1847, the accounts were ordered to be retaken. In the meantime the decree had been executed against Shirazee, who had in consequence become insolvent and filed his schedule. On leaving Bombay, which he was allowed to do after suffering imprisonment, he appointed the before mentioned Zenail, a merchant of Bombay, as his representative, with a power of attorney, which, after his death in Persia in 1856, was renewed by his children. 4. The power of attorney by the children was dated the 23rd of December, 1857, and authorized Zenail to recover, hold, take care of, and guard all the property to which they were entitled, and to appoint any other person as attorney. 5. In 1858 Zenail, in his representat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8. Speaking of the negotiations in 1870, the Appellate Court say: The result of those negotiations was a compromise, by which the Defendants in the suit (i.e., the Shoostrys) were to pay, in settlement of all claims whatsoever of the Shirazee family, out of the fund in Court, the sum of Rs. 2,25,000. Out of this sum the official assignee was to be paid, and the balance was to go to the family of Aga Mahomed Bahim (i.e., Shirazee), and all the other property in litigation handed over and conveyed to the Shoostry family. Mr. Keir, the then solicitor of the Shoostry family, subsequently agreed with Mr. Gamble, who was then the official assignee of Shirazee, that he should receive Rs. 65,000 in discharge of his claims, and Rs. 10,000 in lieu of his commission. This compromise, however, was not carried out. 9. It appears from the 9th paragraph of the plaint that, at the time of the compromise, there were in the hands of the Accountant-General of the Court, standing to the credit of the suit of 1834, Government promissory notes and cash of the value of about four lacs of rupees, and in the hands of Mr. Gamble, the then assignee, who was also receiver in the suit, a valuable pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 12. The tenth to the fifteen articles of the plaint as it originally stood were as follow: 10. In the year 1875 an arrangement was made for the compromise of the said suit, i.e., the suit of 1858, the said Hajee Zenail Abadeen and his son the Defendant Abdool Hoosein acting in the negotiations which resulted in such compromise as the agents or confidential advisers of the Plaintiff in the said suit. 11. By a consent decree made in the said suit on the 12th of July, 1875, copy whereof is hereto annexed and marked C, it was ordered that, the said Accountant General should, out of the said Government promissory notes and moneys in his hands, pay to the Plaintiff in the said suit the sum of Rs. 75,000 and the costs of the said suit, and should make over and pay to the solicitors of the Defendant in the said suit the balance of the said Government promissory notes and moneys, and that the Plaintiff in the said suit, who was also the receiver appointed therein, should assign the said Immovable property to the Defendant therein. 12. In pursuance of the said decree the said sum of Rs. 75,000 was paid to the Plaintiff in the said suit. 13. The Plaintiff has lately been info ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Judge had, however, after the case had been closed, allowed the 15th article of the plaint to be amended by adding the words, And the Plaintiff further said that, even if the said Henry Gamble was aware of the sum of Rs. 1,50,000 being paid to the said Hajee Zenail, the said payment was a fraud upon the Court, which the said Henry Gamble had no power to consent to, and such consent could not be binding on his successor. The learned Judge, therefore, went on to consider whether Zenail fraudulently concealed from the Court the fact of the payment of the Rs. 1,50,000. He said, To sum up, I do not think it proved that Zenail held any official position towards the official assignee. He assisted in the suit, but that was in his own interest. Nor do I think he was guilty of any improper concealment. It was not his duty to inform the Court. He had no locus standi in the eyes of the Court. 15. Their Lordships concur entirely in that opinion. Zenail did not act as the agent of or in a fiduciary relation to the official assignee either at the commencement of the suit of 1858 or in the conduct of it. He, no doubt, gave very valuable assistance, but he was acting, as was well known to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the plaint, by introducing a new and distinct charge of fraud after all the evidence had been given and the case closed, their Lordships feel bound to say that the allowance of it was contrary to every principle of justice, it was wholly unprecedented, and, to say the least of it, it did not exhibit a sound exercise of judicial discretion. 20. The Full Court, on appeal, said it was not disputed that after Mr. Prescot's evidence it must be taken as a fact that, whatever might have been the extent of Mr. Gamble's knowledge in 1870 he was in 1875 acquainted with the intention that Zenail was to receive Rs. 1,50,000 from the Shoostry family, and that he assented to it. This ought to have been an end of the suit. The Court, however, held that Zenail acted in a fiduciary relationship towards Mr. Gamble; but that even in that case the transaction could be impeached only upon the ground that Mr. Gamble's consent was obtained under circumstances amounting to fraud. They held that, under the circumstances of the case, Zenail could not derive any benefit from the suit except on condition of acting in perfect good faith to the creditors. They said his deriving any benefit to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anwhile the Shoostrys were kept out of their inheritance, the creditors of Shirazee were deprived of all chance of a dividend, and the family of Shirazee were debarred from such share as might be theirs if any sums were found due to their father more than enough to satisfy his creditors. Zenail, after the negotiations of 1870, doubtless stood out for the Rs. 1,50,000, which, according to the terms of the arrangement then made, were to be paid in satisfaction of the claims represented by him. The Rs. 2,25,000 were not paid to him, nor was it agreed between Abdool Latiff and Zenail, that only Rs. 75,000 should be paid to Gamble, as alleged in the 13th paragraph of the plaint. The Rs. 2,25,000 were to be paid in settlement of all claims whatsoever, as well of the family as of the creditors of Shirazee. The amount to be paid to Gamble, as assignee on behalf of the creditors, was settled by Prescot with Gamble himself. It was admitted by the Appellate Court, that Gamble consented to accept Rs. 65,000 in satisfaction of the claims of the creditors, but they considered that undue pressure was brought to bear upon him, in addition to the Rs. 10,000, received by him on his own account. Pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndings of the High Court as to the payments made to Prescot and Gamble was that, notwithstanding their finding that the fraud alleged in the plaint was not substantiated, they reversed the decree of the First Court, and, upon the principle that in equity Zenail could derive no benefit from the transaction, ordered that the present Appellants, the Respondents in the Appellate Court, as the heirs and legal representatives of Zenail, should pay to the present Respondent and then Appellant, not merely such a sum as would be sufficient to pay the creditors the full amount of their debts with interest, but the whole sum of Rs. 1,50,000, with interest at 9 per cent, amounting to a sum exceeding two lacs and Rs. 80,894 for debt, and simple interest thereon at the rate of G per cent, per annum from the date of the decree until payment. Their Lordships do not concur in the finding of the High Court as to the object and effect of the payments made to Mr. Prescot and to Mr. Gamble the assignee respectively. They think it right, however, to point out that the Court of Appeal, whatever might have been their opinion as regards those payments, ought to have confined themselves to the charge of fra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ud must be substantially proved as laid, and that when one kind of fraud is charged another kind of fraud cannot, upon failure of proof, be substituted for it. See the case of Montesquieu v. Sandys 18 Ves. 302, in which it was held Page 314 that relief cannot be given upon circumstances which are not made a ground of relief upon the record. 25. Their Lordships might have reversed the judgment of the Court of Appeal on this ground alone, but they have thought it right to say that they do not concur in the opinion expressed by the High Court as to the payments to Preseot and Gamble respectively. 26. It was contended before their Lordships that the assignee had no power to consent to the compromise without the authority of the Insolvent Court. That might possibly be a ground for setting aside altogether the arrangement by which Gamble consented to receive the Rs. 65,000 in satisfaction of the claims of the creditors, as to which their Lordships express no opinion, but it cannot form a ground for altering the terms of the compromise, and allowing the assignee to recover from one who held no fiduciary relationship to him a sum which it was never intended he should receive. 27. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
