BLS LLB 5 Years Sem 7 Transfer of Property Act and Easement Act 2023-24 Question Paper with Solutions

A transfer is conditional when the interest created is made to depend upon a condition, that is on the happening or not happening of an event.

Section 25: an interest created on a transfer of property and dependent upon a condition fails if the fulfilment of the condition is impossible, forbidden by law, of a nature that would defeat the provisions of any law, fraudulent, involves or implies injury to the person or property of another, or is regarded by the Court as immoral or opposed to public policy.

The Transfer of Property Act defines it only negatively: section 3 says "immoveable property" does not include standing timber, growing crops or grass.

The positive definition is in section 3(26) of the General Clauses Act, 1897: it includes land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth.

Section 8 of the Indian Easements Act, 1882: an easement may be imposed by any one in the circumstances, and to the extent, in and to which he may transfer his interest in the heritage on which the liability is to be imposed.

Section 60: at any time after the principal money has become due, on payment or tender of the mortgage-money at a proper time and place, the mortgagor has a right to require the mortgagee to deliver up the mortgage-deed and documents, to deliver possession where the mortgagee is in possession, and at the mortgagor's cost to re-transfer the property or execute an acknowledgement in writing that the mortgagee's right is extinguished.

Section 52 of the Indian Easements Act, 1882: where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immoveable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a licence.

Both arise under section 13 of the Indian Easements Act, 1882, and both come into existence on a severance of what was one holding.

Section 13 provides that where one person transfers or bequeaths immoveable property to another, or where a partition is made of joint property:

• (a) if an easement in other land of the transferor is necessary for enjoying the subject of the transfer, the transferee is entitled to it;
• (b) if such an easement is apparent and continuous and necessary for enjoying the subject of the transfer as it was enjoyed when the transfer took effect, the transferee is entitled to it;
• (c) and (d) give the transferor the corresponding rights over the property transferred; and
• (e) and (f) apply the same rules to a partition.

Clauses (a), (c) and (e) create the easement of necessity; clauses (b), (d) and (f) the quasi easement.

The two compared

Procedure. Foreclosure is available only by suit. Under Order XXXIV Rule 2 of the Civil Procedure Code the Court passes a preliminary decree fixing a period, ordinarily six months, within which the mortgagor may pay. If he pays, the mortgage is redeemed. If he does not, a final decree is passed under Rule 3, and the equity of redemption is extinguished. Limitation is twelve years from the date the money becomes due (Article 63, Limitation Act, 1963).

Restrictions. Section 67 is subject to a contract to the contrary. No suit for foreclosure lies for a mortgagee whose only remedy is sale, or for a trustee or legal representative of such a mortgagee, or where a time has been fixed for payment and has not arrived. Section 67A requires a mortgagee holding several mortgages from the same mortgagor, each carrying the same kind of decree, to sue on all of them or forfeit the rest.

2. By operation of law: arising independently of agreement, for example the unpaid seller's charge for the price under section 55(4)(b), the buyer's charge for prepaid purchase money under section 55(6)(b), a Hindu widow's charge for maintenance, and a charge under a decree of Court.

Charge and mortgage distinguished

Section 111 provides that a lease of immoveable property determines:

• (a) By efflux of the time limited by it. A fixed-term lease ends when the term expires, and no notice is needed.
• (b) By the happening of a specified event on which the term was to end.
• (c) By the termination of the lessor's interest, where his interest in the property ends, or his power to dispose of it extends only to the happening of an event, as with a lease granted by a life tenant.
• (d) By merger, where the interests of lessee and lessor in the whole of the property become vested at the same time in one person in the same right, as when the lessee buys the reversion.
• (e) By express surrender, the lessee yielding up his interest to the lessor by mutual agreement.
• (f) By implied surrender, inferred from conduct inconsistent with the continuance of the lease, such as the grant and acceptance of a new lease of the same premises.

• Section 114, relief against forfeiture for non-payment of rent: if at the hearing the lessee pays or tenders the rent in arrear with interest and full costs, or gives security, the Court may relieve against the forfeiture.
• Section 114A: no suit for forfeiture for breach of an express condition other than for payment of rent lies unless the lessor has served a written notice specifying the breach and, if remediable, requiring it to be remedied, and the lessee has failed within a reasonable time. It does not apply to a condition against assigning, sub-letting or parting with possession.
• Section 115: a surrender does not prejudice an under-lease granted in good faith and for value; on forfeiture, under-leases fall with the head lease.
• Section 116, holding over: if the lessee remains in possession after determination and the lessor accepts rent or otherwise assents, the lease is renewed from year to year or month to month according to the purpose, as specified in section 106.

(i) The provisions relating to the term of the lease

Section 105 requires a term. A lease is a transfer of a right to enjoy property made for a certain time, express or implied, or in perpetuity. Here the deed is silent, so no term has been expressed and the Act supplies one.

Section 106 supplies it. In the absence of a contract or local law or usage to the contrary, a lease of immoveable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable on the part of either lessor or lessee by six months' notice; and a lease for any other purpose shall be deemed to be a lease from month to month, terminable by fifteen days' notice.

Applying it to Anand and Shan. The land is leased for agricultural purposes, so the lease is deemed to be from year to year, terminable by either party on six months' notice.

Section 107, how a lease is made. A lease from year to year, or for a term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument executed by both parties. Since section 106 deems this lease to be from year to year, the deed should have been registered; if it was not, the lease is not a valid year-to-year lease, and Shan, being in possession and paying rent, would ordinarily be treated as a monthly or annual tenant according to the purpose, on the terms the parties acted upon.

Section 117 is the caution. The chapter on leases does not apply to leases for agricultural purposes, except in so far as the State Government may, by notification, declare all or any of its provisions applicable, and any such notification takes effect not less than six months from its date. So on agricultural land the answer is: section 106 states the general rule, but tenancy legislation governs in fact. In Maharashtra that is principally the Maharashtra Tenancy and Agricultural Lands Act, 1948, which regulates the term, the rent and the termination of agricultural tenancies and confers protections that section 106 does not.

(ii) What can be given as consideration in a lease transaction

Section 105 answers this expressly. The consideration may be:

On these facts the natural form is a share of the crops, which the section expressly permits and which is the traditional agricultural rent in India. Service is equally valid: a lease in consideration of the lessee's rendering services to the lessor is a good lease.

What will not do. There must be some consideration: a transfer of the right to enjoy property without any premium or rent is not a lease. And the rent must be rendered periodically or on specified occasions; a single payment with nothing recurring is a premium, not rent, though a lease may validly be granted for a premium alone.

The three conditions are all satisfied here. C has professed to transfer Oasis, which is A's property and which C has no right to transfer, and it is immaterial whether or not C believed it to be his own. C has conferred a benefit, Rs. 12 lakh, on A, the owner of that property, as owner. And both are done by the same gift deed, that is as part of one transaction.

(i) The rights of A

A is put to his election and has exactly two courses.

1. Confirm the transfer. A may allow Oasis to pass to D and keep the Rs. 12 lakh. On these figures that is the profitable course: he gives up property worth Rs. 10 lakh and takes Rs. 12 lakh.
2. Dissent from the transfer. A may keep Oasis and must then relinquish the Rs. 12 lakh, which reverts to C or his representative.

A cannot do both. He may not keep Oasis and take the money, because he who takes under an instrument must take under the whole of it, and a person may not approbate and reprobate.

How A must elect, and by when.

If A dissents, what happens to D. The gift here is gratuitous. Under the section, the reverting benefit is charged with compensating the disappointed transferee only where the transfer was for consideration, or where it was gratuitous and the transferor has died or become incapable of making a fresh transfer before the election. So if C is alive and capable when A dissents, the whole Rs. 12 lakh simply reverts to C, and D gets nothing. If C had died before the election, C's representative would have had to pay D Rs. 10 lakh, the value of Oasis, out of the Rs. 12 lakh.

(ii) The rights of the parties if A dies after accepting the Rs. 12 lakh

A's acceptance is itself the election. By the section, acceptance of the benefit by the person on whom it is conferred constitutes an election by him to confirm the transfer, provided he was aware of his duty to elect and of the material circumstances, or waived enquiry into them. Nothing in the section requires anything further, and once made an election is final and irrevocable.

The consequences, party by party:

• D takes Oasis absolutely. A's election has confirmed C's transfer, and A's heirs are bound by it, since they claim through him and can be in no better position.

(i) The types of easementary rights in this situation

Two distinct easements arise on these facts, and they are of different kinds.

First, a right to light and air (a right of light) over Wonderland. Dreamland receives direct sunlight across Wonderland. A right to the free passage of light and air to the openings in a building is an easement under section 4, and it is:

• continuous, under section 5, because its enjoyment is or may be continual without the act of man;

• discontinuous, under section 5, because it needs the act of man for its enjoyment;
• apparent or non-apparent according to whether there is a made path or other visible sign;
• positive, because Shree does something on Raj's land.

If Dreamland and Wonderland were severed from one holding, the right arises under section 13(a) as an easement of necessity, the test being absolute necessity and not convenience, which is plainly met where there is no other access at all. By section 14, Raj as the person bound to grant it is entitled to fix a convenient way, and if he refuses or neglects, Shree may fix it, subject to its being reasonably convenient for Shree and least onerous to Raj. By section 41 it would be extinguished if the necessity ended, for example if a public road later reached Dreamland.

If the two plots were never one holding, no easement of necessity can arise, and Shree must show a grant, or prescription under section 15, or a customary right under section 18. In the meantime his remedy would be under the Mumbai Municipal or regional planning law for access, not under this Act.

What follows from those labels. As dominant owner Shree must exercise his rights in the mode least onerous to Raj (section 22), may do acts on Wonderland necessary to secure enjoyment at his own expense and at a convenient time (section 24), must bear the expenses of preserving the easement (section 25), and must not use them for any purpose unconnected with the enjoyment of Dreamland (section 21). As servient owner Raj is not bound to do anything for the benefit of the easements (section 27), and may use Wonderland as he pleases so long as he does not disturb them; he may even impose further easements on it, provided they do not lessen the utility of Shree's (section 9). If Raj obstructs either right, Shree may sue for compensation where substantial damage is caused (section 33), for an injunction (section 35), or abate the obstruction (section 36).

First, section 7: he is not entitled to it and is not authorised to dispose of it. The property is his father's. Ronak has no title, and being an "only child" gives him none. Managing the property and taking the decisions confers no power of disposal either; a person who looks after property is not thereby its owner.

Second, section 6(a): being an heir is not a right in property at all. During his father's lifetime Ronak is only an heir apparent, and what he has is a spes successionis, the chance of an heir apparent succeeding to an estate, which cannot be transferred. His father may sell the flat, give it away or leave it by will to anyone he pleases, and the expectancy simply disappears. A transfer by Ronak of the flat, or of his chance of inheriting it, is void ab initio, and no consideration validates it.

Third, "joint flats" does not make him a co-owner. The facts say the family has two flats, one in each name. Property standing in the father's name alone is his separate property, and joint residence does not create joint ownership. Even if the two were genuine co-owners of one flat, section 44 would allow a co-owner to transfer only his own share, and the transferee would step into his shoes; it would not let him sell the whole.

1. Competent parties. The seller must be competent to contract under section 11 of the Indian Contract Act, 1872 (majority, sound mind, not disqualified) and must be entitled to the property or authorised to dispose of it (section 7). The buyer must be competent to hold property; a minor may be a buyer, since taking a benefit imposes no liability, but not a seller.

2. Price in money. "Sale" is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised. If the consideration is another thing it is an exchange (section 118); if there is none it is a gift (section 122). The price may be unpaid at completion, the seller being left with a charge for it under section 55(4)(b).

3. Mode of transfer.

• Tangible immoveable property of Rs. 100 or more, and a reversion or other intangible thing: only by a registered instrument.
• Tangible immoveable property worth less than Rs. 100: by a registered instrument or by delivery of the property, delivery taking place when the seller places the buyer in possession.

The policy. Litigation would never end if a defendant could sell the property during the suit and compel the plaintiff to start again against the buyer, and again against the buyer's buyer. As the Privy Council put it in Faiyaz Husain Khan v. Prag Narain (1907) 29 All 339, the necessary effect of the doctrine is that a party to a suit cannot, by alienation, prejudice the rights of the other party, and the rule rests on necessity and public policy rather than on any equity between the transferor and the transferee.

Section 52. During the pendency in any Court having authority within the limits of India, or established beyond such limits by the Central Government, of any suit or proceeding which is not collusive and in which any right to immoveable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.

5. The property is transferred or otherwise dealt with by a party to the suit. "Otherwise dealt with" is wide: a lease, a mortgage, a surrender, a charge or a partition all fall within it.
6. The transfer affects the rights of another party under the decree that may be made.

Effect of a transfer made in breach

The transfer is not void, and this is the proposition most answers get wrong.

• It is valid as between transferor and transferee, and passes whatever the transferor had.
• It is not binding on the other party to the suit, who takes under the decree as if the transfer had never been made.
• The transferee is bound by the result of the litigation. He may apply to be joined as a party, and the Court may permit the transfer under the section's own exception, on such terms as it imposes.

The basis is jurisdiction, not notice

• Jayaram Mudaliar v. Ayyaswami (1972) 2 SCC 200: the Court explained that the doctrine does not annul the conveyance, but only renders it subservient to the rights of the parties under the decree; a partition suit is a proceeding in which a right to immoveable property is directly and specifically in question.
• Sanjay Verma v. Manik Roy (2006) 13 SCC 608: a transferee pendente lite is not entitled as of right to be impleaded, but he is bound by the decree; his remedy is to apply for leave, which may be granted where his interests are not otherwise protected.

Exceptions and limits

• A transfer made under the authority of the Court, on the terms it imposes.
• A collusive suit.
• A suit in which a right to immoveable property is not directly and specifically in question.
• A Court without jurisdiction.
• The section applies only to immoveable property.
• In some States the section has been amended to require registration of a notice of pendency before a transferee is bound; where such an amendment applies, an unregistered lis pendens does not affect a purchaser.

1. A claim to a debt. A debt is a liquidated money demand, a sum certain that is presently due, or will become due, or may become due on a contingency. The definition therefore covers an existent debt (already due), an accruing debt (due in future), a conditional debt and a contingent debt.
2. But not a secured debt. A debt secured by a mortgage of immoveable property, or by hypothecation or pledge of moveable property, is expressly excluded, because its transfer is governed by the law of mortgages and pledges.
3. A beneficial interest in moveable property not in the claimant's possession. The claimant must have a right to the moveable but not the moveable itself.
4. Recognised by the Civil Courts as affording grounds for relief. A claim the courts will not entertain is not an actionable claim.

What is and what is not an actionable claim

Two things follow and both are examinable:

• The transfer must be in writing and signed. It cannot be oral, and, unlike a sale of land, registration is not required.
• The transfer is complete on execution, and notice to the debtor is not a condition of validity. Notice matters only for the purposes stated in the proviso and in section 131.

The proviso to section 130 protects the debtor: every dealing with the debt or claim by the debtor with the transferor, until the debtor receives express notice of the transfer, is valid as against the transferee. So a debtor who pays his original creditor in ignorance of the assignment is discharged.

Section 130 further provides that the transferee may sue or institute proceedings in his own name without obtaining the transferor's consent and without making him a party.

Section 131, notice to be in writing, signed. Every notice of transfer of an actionable claim shall be in writing, signed by the transferor or his agent duly authorised in that behalf, or, in case the transferor refuses to sign, by the transferee or his agent, and shall state the name and address of the transferee.

Section 135, assignment of rights under a policy of insurance against fire. Every assignee, by endorsement or other writing, of a policy of fire insurance has, on the property in the policy passing to him, all the rights of action and is subject to all the liabilities of the assignor.

Section 136, incapacity of officers connected with Courts of Justice. No Judge, legal practitioner or officer connected with any Court shall buy or traffic in, or stipulate for, or agree to receive any share of, or interest in, any actionable claim, and no Court shall enforce such a claim at his instance. The rule is directed against champerty and maintenance by court officers.

Section 137, saving of negotiable instruments and others. Nothing in Chapter VIII applies to stocks, shares or debentures, or to instruments which are for the time being negotiable instruments, or to any mercantile document of title to goods.

Reason. An expectancy is not property. The owner may sell, give away or bequeath the property at any moment, and the hope disappears. To allow such transfers would create a market in the deaths of others. Note. The transfer is void ab initio, not voidable, and consideration does not cure it. It is distinct from a contingent interest under section 21, which is an existing interest and is transferable. An heir who takes money for a release as part of a family arrangement may nevertheless be estopped: Gulam Abbas v. Haji Kayyum Ali (AIR 1973 SC 554).

Clause (b), right of re-entry. A mere right of re-entry for breach of a condition subsequent cannot be transferred to anyone except the owner of the property affected thereby.

Reason. The right is personal to the lessor and exists only to protect his reversion; separated from the reversion it would be a bare right to forfeit another's estate. A lessor who transfers the reversion transfers the right of re-entry with it, and that is lawful.

Clause (c), easement. An easement cannot be transferred apart from the dominant heritage.

Clause (e), mere right to sue. A mere right to sue cannot be transferred.

Reason. To prevent trafficking in litigation, that is champerty and maintenance. A claim for unliquidated damages, whether for breach of contract or in tort, is a mere right to sue. Contrast an actionable claim, a liquidated debt, which section 130 expressly allows to be transferred. So the price of goods sold may be assigned, but a claim for damages for their defective quality may not.

Clause (f), public office. A public office cannot be transferred, nor can the salary of a public officer, whether before or after it has become payable.

Reason. A public office is held for the performance of public duties and is given for personal qualifications; the salary is to enable the officer to maintain himself in that office. See also section 60 of the Civil Procedure Code, which exempts a portion of salary from attachment.

Clause (g), stipends and pensions. Stipends allowed to military, naval, air-force and civil pensioners of the Government, and political pensions, cannot be transferred.

Clause (i), statutory tenant's right of occupancy. Nothing in this section shall be deemed to authorise a tenant having an untransferable right of occupancy, the farmer of an estate in respect of which default has been made in paying revenue, or the lessee of an estate under the management of a Court of Wards, to assign his interest as such tenant, farmer or lessee.

Reason. These interests are conferred by statute for the personal benefit of the holder, on grounds of agrarian or revenue policy, and would be defeated if they could be sold.

Property that is transferable, by way of contrast. A vested interest (section 19) and a contingent interest (section 21); an actionable claim; an equity of redemption; arrears of maintenance; the right to recover mesne profits already ascertained; and a share in a partnership.

Transactions that are not transfers at all, and so fall outside the section entirely: a partition, because each co-owner already owns his undivided share; a surrender or relinquishment, which merges a lesser interest in a greater; a family arrangement recognising existing rights; a charge, which creates no interest; a compromise decree recording pre-existing rights; and transmission by operation of law, such as inheritance, insolvency or a court sale.

2. Release, section 38. An easement is extinguished when the dominant owner releases it, expressly or impliedly, to the servient owner. A release may be made only in the circumstances and to the extent in and to which the dominant owner can alienate the dominant heritage. An easement may be released as to part only of the servient heritage. Implied release is inferred from conduct showing an intention to abandon the right; mere non-use is not enough by itself, which is why section 47 exists separately.

3. Revocation, section 39. An easement is extinguished when the servient owner, in exercise of a power reserved for that purpose, revokes it. The power must have been reserved when the easement was imposed.

4. Expiration of a limited period or happening of a dissolving condition, section 40. By section 6 an easement may be created for a limited period or on a condition that it shall become void on the happening of a specified event. When the period expires or the condition happens, the easement ends.

5. Termination of necessity, section 41. An easement of necessity is extinguished when the necessity comes to an end. If the owner of a landlocked plot acquires another lawful access, the way of necessity ends of itself.

9. Destruction of either heritage, section 45. An easement is extinguished when either the dominant or the servient heritage is completely destroyed. Where the destruction is temporary and the heritage is restored, the easement may revive under section 51.

10. Unity of ownership, section 46. An easement is extinguished when the same person becomes entitled to the absolute ownership of the whole of the dominant and servient heritages.

Three limits are essential and are what problems are built on:

• the ownership must be of the whole of both heritages, not part;
• it must be absolute and in the same right: a person who holds one as a trustee, or as one of several co-owners, or for a limited estate, does not extinguish the easement; and
• the easement does not revive automatically when the heritages are separated again, though a quasi easement may then arise under section 13.

• Suspension, section 49. An easement is suspended when the dominant owner becomes entitled to possession of the servient heritage for a limited interest in it, or when the servient owner becomes entitled to possession of the dominant heritage for a limited interest. Suspension is temporary and does not destroy the right.
• Revival, section 51. An easement extinguished under section 45 (destruction) revives when the destroyed heritage is, before twenty years have expired, restored by alluvion; when the destroyed heritage is a servient building and, before twenty years have expired, such a building is rebuilt on the same site; and when the destroyed heritage is a dominant building and, before twenty years have expired, such a building is rebuilt on the same site and in such a manner as not to impose a greater burden on the servient heritage. An easement suspended under section 49 revives when the cause of suspension is removed. An easement extinguished under section 46 by unity of ownership does not revive merely because the heritages are separated again, except in the cases the section allows.

Summary