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Report No. 70

Chapter 33

Apportionment

Sections 36-37

33.1. Introductory.-

The transfer of an interest in property sometimes raises problems, where the property carries income and the income is to be received from a third person. Such problems may arise either because of the creation of successive interests in property, or because of the co-existence of concurrent interests in property arising by reason of severance. In the first case, the chronological element becomes important. What are the respective rights of the predecessor and the successor?

In the second case, the simultaneous co-existence of more than one beneficiary raises this question-What are the respective rights of the co-shares? The first topic, conveniently described as "apportionment in point of time," is dealt with in section 36. The second topic, conveniently described as "apportionment in point of estate", is reserved for section 37.

33.2. Section 36.-

Apportionment of periodical payments in point of time, then, is the subject-matter of section 36, which is condensed1 from sections 2 to 4 of the (English) Apportionment Act, 1870.

Under the section, in the absence of a contract or local usage to the contrary, all rents, annunities, pensions, dividends and other periodical payments in the shape of income shall, upon the transfer of the interest of the person entitled to receive such payments, be deemed, as between the transferor and the transferee, to accrue due from day to day and to be apportionable accordingly, but to be payable on the days appointed for the payment thereof.

The section applies only where there is a transfer of property, though it relegates the words "upon the transfer of the interest" somewhere in the middle. What is transferred is the transfer of the interest of a person entitled to receive the specified payments, namely, rent etc. On such a transfer, it lays down the rule to be applied, as between the parties to the transfer.

1. Gour.

33.3. Meaning of apportionment.-

Lord Coke remarked1 that "the word 'apportionment' cometh of the word partio, quasi partio, which signifieth a part of the whole, and "apportion" signifieth a division of a rent common, etc. or a making of it into parts". The term2 is used in two senses:

(i) to denote distribution of a common fund among the several claimants; and

(ii) sometimes, to denote the contribution made by several persons having distinct rights to discharge a common burden. The words "rents, annuities, etc." here used, are nowhere defined in this Act or in the General Clauses Act. They are, however, defined in section 5 of the English3 Statute in the following terms:

"5. In the construction of this Act, the word 'rents' includes rent service, rent charge; and rent seek; and also tithes and all periodical payments or rendering in lieu of, or in the nature of rent or tithe. The word "annuities" includes salaries and pensions. The word 'dividends' includes (besides dividends strictly so-called) all payments made by the name of dividend, bonus, or otherwise, out of the revenue of trading or other public companies, divisible between all or any of the members of such respective companies, whether such payments shall be usually made or declared at any fixed time or otherwise; but this does not include payments in the nature of a return or reimbursement or capital."

It includes, however, occasional bonuses or surplus profits of the share-holders.4 The phrase "as between the transferor and the transferee," implies that a stranger cannot apportion them, and the provisions expressed by "to accrue due from day to day", is only for the purpose of apportionment. Under the Bengal Tenancy Act, rent is not ordinarily regarded as accruing from day to day, but as falling due only at stated times according to the contract or tenancy of the general lawn.5

1. Co. Lt. 147-b, cited in Gour.

2. Story Eq. fur. (2nd Eng. Edn.), 305.

3. Apportionment Act, 1870.

4. Carr v. Griffith, 12 Ch D 655.

5. Per Banerjee, j., in Satyendra Nath v. Nilkantha, ILR 21 Cal 383 (385).

33.4. No change.- We have no changes to recommend in section 36.

33.5. Section 37.-

The subject-matter dealt with in section 37 is apportionment by estate, in contrast with apportionment by time which was dealt with in section 36.



The Transfer of Property Act, 1882 Back




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