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Report No. 89

32.71. Article 40.- Article 40 reads as unde.-

"By the payee against the drawer of a bill of exchange which has bee dishonoured by non-acceptance.

Three years.

The date of the refusal to accept."

It is identical with Article 78 of the Acts of 1908, 1877 and 1871.

No change is needed in the article.

32.72. Article 41.- Article 41 reads as unde.-

"By the accepter of an accommodation-bill against the drawer.

Three years.

The date of the refusal to accept."

It is identical with Article 79 of the Acts of 1908 and 1877. Article 81 of the Act of 1871 was as follow.-

"By the accepter of an accommodation-bill against the drawer.

Three years.

The date of the refusal to accept."

No change is needed in the article.

32.73. Article 42.- Article 42 reads as unde.-

"By the surety against the principal debtor.

Three years.

When the surety pays the creditor."

It is identical with Article 81 of the Acts of 1908 and 1877, and with Article 82 of the Act of 1871.

32.74. Case law.- A resume of the case law under this article shows that while differences of opinion do arise in regard to the rights and liabilities of the surety under the general law of contract and the terms of, the surety bond, the wording of the article, alone and by itself, has not given rise to any serious difference of opinion and hence no textual change is recommended in the article.

32.75. Article 43.- We now proceed to Article 43. It reads as unde.-

"By the surety against a co-surety.

Three years.

When the surety pays anything in excess."

It is identical with Article 82 of the Acts of 1908 and 1877 and with Article 83 of the Act of 1871.

No change is needed in the article.

32.76. Article 44.- Article 44 reads as unde.-

"(a) On a policy of insurance when the sum insured payable is after proof the death has been given to or received by the insurers.

Three years.

The date of the occurrence causing the loss, or where the claim on the policy is denied, either partly of wholly, the date of such denial."
"(b) On a policy of insurance when the sum insured payable is after proof the death has been given to or received by the insurers.

Three years.

The date of the death of the deceased, or where the claim on the policy is denied, either partly or wholly, the date of such denial."

Article 86 of the Act of 1877, read as unde.-

"(a) On a policy of insurance when the sum insured is payable after proof of the death has been given to or received by the insurers.

Three years.

The date of the death of the deceased."
"(b) On a policy of insurance when the sum insured is payable after proof of the loss has been given to or received by the insurers.

Three years.

The date of the occurrence causing the loss."

Article 86 of the Act of it *1877 read as unde.-

"On a policy of insurance when the sum assured is payable immediately after proof of the death or loss has been given to or received by the insurers.

Three years.

When proof of the death or loss is given or received to or by the insurers, whether by or from the plaintiff or any other person."

This was identical with Article 88 of the Act of 1871.

Article 86, as quoted above from the Act of 1908, was substituted in it by the Insurance (Amendment) Act, 1941, section 68. Previously, the time ran from "when proof of the death or loss was given to or received by the insurer."

In the Act of 1963, the words "or where the claim on the policy is denied, either partly or wholly, the date of such denial" in the third column of both the clauses of the article are new and were brought in at the Joint Committee stage. They provide an alternative starting point of limitation with reference to life insurance policies and other policies.

The article needs no change.

* It seems to be a misprint for 1908.

32.77. Article 45.- Article 45 reads as unde.-

"By the assured to recover premia paid under a policy voidable at the election of the answerers.

Three years.

When the insurers elect to avoid the policy."

It is identical with Article 87 of the Acts of 1908 and 1877, and with Article 89 of the Act of 1871.

The article needs no change.

32.78. Article.-History.- Article 46 reads as unde.-

"Under the Indian Succession Act, 1925 (XXXIX of 1925), section 3690 or section 361 to compel a refund by a person to whom an executor or administrator has paid a legacy or distributed assess..

Three years.

The date of the payment or distribution."

It corresponds to Article 43 of the Acts of 1908 and 1877. In the Limitation Act, 1871, this article found no place. The phraseology of the article has consistently remained the same except that the Repealing and Amending Act, 1930 substituted the words "Indian Succession Act, 1925 (XXXIX of 1925), section 360 or section 361," in place of the words "Indian Succession Act, 1865, section 320 and section 321 or under the Probate and Administration Act, 1881, section 139 and section 140."

The Article needs no change.

32.79. Article 47.- Article 47 reads as unde.-

"For money paid upon an existing consideration which afterwards fails.

Three years.

The date of the failure."

It is identical with Article 97 of the Acts of 1908 and 1877, and with Article 98 of the Act of 1871.

The Law Commission in its Report1 on the Act of 1908, recommended a proper placement of the article under the category of contracts, and this recommendation has been accepted.

1. Law Commission of India, 3rd Report (Limitation Act, 1908), para. 101.

32.80. Conflict regarding failure of consideration in full or in part.- Though the article has not evoked any controversy in its application, a solitary judgment of the Judicial Commissioner1, Oudh, held that when the plaintiffs were in possession of some portion of the property transferred to them by the defendant, it would not amount to "failure of existing consideration," as a part of the consideration is in the hands of the plaintiffs.

This view (for which no authority was cited) has not gained currency and has not been followed in any subsequent cases. In a Bombay case2, it was conceded by both the parties that Article 97 of the Act of 1908 applied even when there was partial failure of the consideration. In a Madras case3, a feeble attempt was made to contend that Article 97 (of the Act of 1908) did not apply where there was partial failure of consideration, which was brushed aside by the court:

"I can find no authority for such a proposition and I am not prepared to accept as there is no reason why the words 'an existing consideration' in Article 97 should be read as meaning 'the whole consideration for the contract'."

To the same effect is a Punjab case.4

1. Karim Bux v. Abdul Wahid Khan, AIR 1924 Oudh 377.

2. Bapu v. Kashiram, AIR 1929 Born 361.

3. Meenakshi v. Krishna Royar, AIR 1917 Mad 296.

4. Gillu Teekan v. Damodar Doss, AIR 1972 Punj 23.



The Limitation Act, 1963 Back




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