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Report No. 70

Chapter 18

Restraint on Enjoyment

Section 11

18.1. Introductory.-

We come to another topic dealing with another type of restraint. This time, the law is concerned not with a condition or a limitation imposing a restraint on alienation, but a restraint on enjoyment or application. The matter is dealt with in section 11. The section consists of two paragraphs. The first paragraph contains the main provision, while the second paragraph is really in the nature of an exception, or at least in the nature of a saving.

Under the first paragraph, where, on a transfer of property, an interest therein is created absolutely in favour of any person but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there were no such direction.

Under the second paragraph, where any such directions has been made in respect of one piece of immovable property for the purpose of securing the beneficial enjoyment of another piece of such property, nothing in this section shall be deemed to affect any right which the transferor may have to enforce such direction or any remedy which he (the transferor) may have in respect of a breach thereof. The second paragraph was modified by the amendment of 1929 and is generally regarded as a codification of the equitable doctrine of negative covenants, but it is wider than that.

In the case of a negative covenant-for example, a covenant not to build so as to obstruct a view or not to use a piece of land otherwise than as a garden-the court has power to interfere and the covenant is enforceable. Of course, where specific relief is claimed, the grant thereof is subject to the general principles regulating the grant of specific relief.

18.2. First paragraph.-

The first paragraph raises no serious problems. It is enough to point out that it applies only where an interest is created absolutely on a transfer of property. The general rule enacted is that a direction for application or enjoyment is void.

18.3. Object of the grant.-

Where the main object of the grant is clear, conditions clearly inconsistent with that object cannot be held to be valid. In dealing with a question of this kind, there is sometimes a difficulty. If one is to regard it as a question of construction, one asks one self the question what the parties mean by first saying in the instrument that ownership is to be transferred and then saying that what is transferred is not ownership in the proper sense. In such a case every attempt to reconcile these statements should be made.

But if no reconciliation is possible, the courts give effect to the main object of the parties and the provisions inconsistent therewith are treated as void. The court has to see whether the clause so far detracts from the enjoyment conveyed that to uphold it would be contrary to public policy.

18.4. Need to decide whether absolute interest created.-

It is, however, a difficult question to decide whether the transfer in a particular case is absolute and therefore the condition restricting enjoyment is void as repugnant, or whether the transfer, by reason of the condition, is not to be regarded as an interest "created absolutely" within the meaning of section 11. In the former case, the condition is void under section 11, but not so in the latter case. The difficulty illustrated by two Calcutta cases.

In a case decided in 1954,1 a person conveyed certain property to another person but reserved for himself a subordinate or tenancy right under the transferee. The reservation was held to be valid. The transfer is to be regarded not as a transfer of the entire interest of the owner, but only of a portion-actual possession of the property remaining with the transferor on his undertaking to pay rent to the transferee. Reservation of a subordinate interest is in no way inconsistent with the proprietary interest.

In another Calcutta case,2 property was transferred absolutely but a clause in the sale-deed--the clause usually described in conveyancing practice as habendum-was so framed that the interest of the immediate transferee was, in substance, restricted to a life interest. The clause was as follows:-

"To have and to hold the said messages tenements or dwelling houses lands hereditaments and premises hereby granted or expressed so to be free from all encumbrances unto and to the use of the said purchaser Sreemati Kalidashi Devi to be held by her for the term of her natural life as the estate of a Hindu widow and from and after her death to her three sons Samaresh Chandra Mukherjee, Sikharesh Chandra Mukherjee and Sunilesh Chandra Mukherjee to be held by them as tenants in common during their respective lives without power of anticipation and after their death unto and to the use of their respective heirs absolutely and for ever."

It was held that the transfer was of an absolute interest and no transferor can, when executing an absolute transfer, restrict the nature of the interest passing to the transferee in such a manner.

In the last mentioned case, unfortunately, the conveyancer seems to have used a inconsistent language-first describing the instrument as a sale-deed and then inserting a restrictive clause in the terms quoted the rule in section 11. This does not, however, mean that in every case such a clause must be regarded as in operative. The first duty of the court, when it is called upon to apply section 11, is to decide whether the transfer creates an absolute interest. It is then only that occasion for applying the operative portion in the section arises.

1. Bejoy Krishna v. Iswar Damodar, AIR 1954 Cal 400 (402) (R.P. Mookerjee and Benusengupta Mukherjee, JJ.).

2. Manjusha Debi v. Sunil Chandra, AIR 1972 Cal 310 (Amiya Kumar Mookerji, J.).

18.5. Gifts.-

In regard to gifts, a question would arise whether the gift was conditional or absolute with a condition attached. If the gift is conditional, the condition is valid; in the latter case, the condition is void. Restrictions in an absolute grant that the grantee shall live at a particular place or that the property shall not pass to the grantee's daughter, are void.1 In an earlier case,2 where, by a trust-deed, it was provided that a dwelling-house dedicated to the worship of the deities should not to alienated for twenty years, the court gave effect to the prohibition.

This case was referred to and commented upon in another case3 in which Wilson, J., observed:

"That case decided, I think, no more than this, that there was a valid trust for the performance of certain worship in the dwelling-house and as incidental to that trust, a restraint upon partition or alienation during the period of the trust, and that a mortgagee with notice was bound by it."

1. Saraju Bala v. jyotirmoyee, ILR 59 Cal 142 (PC)

2. Ananth v. A.B. Mackintosh, 8 BLR 60.

3. Rajender v. Sham Chund, ILR 6 Cal 106 (116, 117).

18.6. Second paragraph.-

The second paragraph is primarily, though not exclusively, meant for the convenient enjoyment of adjacent properties. The leading English case of Tulk v. Moxhay, (1848) 2 Phi11 774, illustrates the principle. Thus, a covenant between the vendor and the purchaser that the purchaser and his assigns shall abstain from using the land in a particular way would be enforceable in equity, not only against the immediate purchaser but also against subsequent purchasers with notice1-and this is independently of the question whether the covenant at law runs with the land so as to bind even purchasers without notice.

We are not, at the moment, concerned with the question how far subsequent purchasers should be bound-a matter dealt with, to some extent, in section 40. For the present, it is enough to state that the second paragraph takes out of the operation of the first paragraph the case under consideration. In other words, the provision in the first paragraph that the transferee shall be entitled to receive and dispose of such interest "as if there were no such directions" which, on its text is absolute and unqualified, is modified to the extent mentioned in the second paragraph, so far as the general validity of such a covenant is concerned.

1. Cf. section 40.

18.7. First paragraph.-

It may be noted that the first paragraph of the section broadly corresponds to section 138 of the Indian Succession Act, 1925, quoted below:-

"138. Where a fund is bequeathed absolutely to or for the benefit of any person but the will contains a direction that it shall be applied or enjoyed in a particular manner, the legatee shall be entitled to receive the fund as if the will had contained no such direction:"1

That section has an illustration as follows:

"A sum of money is bequeathed towards purchasing a country residence for A, or to purchase a commission in the army for A or to place A in any business. A chooses to receive the legacy in money. He is entitled to do so."

1. Section 138, Succession Act.

18.8. Negative covenants.-

The second paragraph of section 11 is an exposition of the equitable doctrine of negative easements; such, for instance, as a right to the access of light, which prevents the owner of the servient tenement from building so as to obstruct it. Where there is a negative convenant expressed or implied-as, for instance, a covenant hot to build so as to obstruct a view, or not to use a piece of land other wise than as a garden-the court interferes unless its hand is stayed on the ground of greater inconvenience.

Thus, a covenant between vendor and purchaser, on the sale of land, that the purchaser and his assigns shall abstain from using the land in a particular way will be enforced in equity against all subsequent purchasers with notice independently of the question, whether it be one which runs with the land so as to be binding upon subsequent purchasers at law.1

So, where the owner of a plot of land sold a part of it to another and covenanted that the land "should never be hereafter sold, but let for the common benefit of both parties and their successors," it was held that the agreement to keep the land open was binding between the parties and their representatives, and that, therefore, the person who might hold the vendee's land, had the right to enforce the obligation against the person who might hold the vendor's land.2

1. Tulk v. Moxhay, (1848) 2 Phill 774.

2. McLean v. McKay, LR 5 PC 327;

Dhannu Lal v. Bansidhar, AIR 1929 Pat 349.

18.9. Thus, if the plaintiff sells one of his two neighbouring houses; a stipulation in the sale-deed that the vendee should not construct windows or doors to the southern side of the house but that there should be only Zarookas of 11/4 by P/4 for light is not void and is enforceable.1

1. 1962 Nag LJ (Notes) 40 cited in the Yearly Digest.

18.10. Second paragraph not confined to negative covenants.-

Of course, the second paragraph of section 11 is not confined to negative covenants. As between the transferor and the transferee, it would appear that even affirmative covenants, if intended to secure the beneficial enjoyment of a piece of immovable property are, in general, valid. Such covenants are distinguishable from easements which, if otherwise legally created, would bind the whole world irrespective of notice.

The point to be made is that as between the transferor and the transferee, even an affirmative covenant would be saved by the section, whatever be the position as regards enforcement by claiming specific relief and whatever be the position as regards enforceability against subsequent transferees. The grant of specific relief would, of course, depend on circumstances-including even changed circumstance.1

1. McLean v. McKay, LR 5 PC 327 (337).



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