Rights of a Purchaser or Lessee Against a Person with No Title

In one line

A seller who did not own what he sold cannot enforce the bargain, but the buyer can, and section 13 sets out four ways of holding him to it.

In the words a student can write in an exam: section 13(1) of the Specific Relief Act 1963 provides that where a person contracts to sell or let certain immovable property having no title or only an imperfect title, the purchaser or lessee has four rights: to compel him to make good the contract out of any interest subsequently acquired; to compel him to procure the concurrence or conveyance of others bound to concur at his request; where he professes to sell unencumbered property that is in fact mortgaged for an amount not exceeding the purchase money, to compel him to redeem the mortgage and obtain a valid discharge; and, where his suit is dismissed for want of title, to a return of the deposit with interest and costs, and a lien for them. Sub-section (2) applies the same provisions, as far as may be, to contracts for the sale or hire of movable property.

Why the section runs one way only

Sections 13 and 17 are a pair and they must be read together.

Section 17 says that a vendor or lessor with no title, or who cannot at the time fixed give a title free from reasonable doubt, cannot obtain specific performance.

Section 13 says that the purchaser or lessee in the same situation can, and gives him four routes.

The asymmetry is deliberate and it is the point of the section. The seller created the problem; he should not profit from it by escaping a bargain that has become inconvenient. The buyer did not create it, and if there is any way of giving him what he bargained for, the law will take it.

The sentence to write: want of title is a shield for the buyer and never a sword for the seller.

The provision itself

"(1) Where a person contracts to sell or let certain immovable property having no title or only an imperfect title, the purchaser or lessee (subject to the other provisions of this Chapter), has the following rights, namely:

(a) if the vendor or lessor has subsequently to the contract acquired any interest in the property, the purchaser or lessee may compel him to make good the contract out of such interest;

(b) where the concurrence of other persons is necessary for validating the title, and they are bound to concur at the request of the vendor or lessor, the purchaser or lessee may compel him to procure such concurrence, and when a conveyance by other persons is necessary to validate the title and they are bound to convey at the request of the vendor or lessor, the purchaser or lessee may compel him to procure such conveyance;

(c) where the vendor professes to sell unencumbered property, but the property is mortgaged for an amount not exceeding the purchase money and the vendor has in fact only a right to redeem it, the purchaser may compel him to redeem the mortgage and to obtain a valid discharge, and, where necessary, also a conveyance from the mortgagee;

(d) where the vendor or lessor sues for specific performance of the contract and the suit is dismissed on the ground of his want of title or imperfect title, the defendant has a right to a return of his deposit, if any, with interest thereon, to his costs of the suit, and to a lien for such deposit, interest and costs on the interest, if any, of the vendor or lessor in the property which is the subject-matter of the contract.

(2) The provisions of sub-section (1) shall also apply, as far as may be, to contracts for the sale or hire of movable property."