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Doctrine of Lis Pendens: A Right Against Unauthorized Alienation

Lis pendens means a suit under consideration of any court of law. It is an action which is pending in any court. The doctrine is enshrined under Section 52 of the Transfer of Property Act, 1882. This section is based on the maxim ‘ut lite pendente nihil innovetur' which means that nothing new should be introduced into a pending litigation. Therefore, the property which is in dispute should not either be sold or otherwise dealt in by any party to the dispute during the pendency of the suit or proceeding.

The article discusses about the principle underlying the object of the doctrine, that is to maintain the status quo unaffected by the act of any party to the litigation pending. The principles contained in this doctrine are in accordance with the principle of equity, good conscience or justice because they rest upon an equitable and just foundation, that it will be impossible to bring an action or suit to a successful termination if alienations are permitted to avail. The article also discusses about the essentials required for the application of the doctrine along with the judicial precedents set by the Hon’ble Supreme Court of India.

Rights depend upon remedies.[1]
This also holds good as regards the right to property. Since speedy and efficient remedies are of utmost importance, it has to be ensured that once a person has initiated legal process in any court to seek remedy against any invasion on his right or threat of invasion thereto, the legal process should not be defeated on account of private deals or any transaction, that is, transfer of property in dispute or on account of any other action of any party to such legal process, otherwise the very purpose of seeking relief against any grievance would be meaningless and ineffective.[2]

In order to ensure that the legal remedy remains efficient throughout the legal process, jurists had evolved a general principle known as lis pendens basing it on the necessity that neither party to the litigation should alienate the property in dispute so as to affect his opponent.[3]

Wharton’s Law Dictionary defines lis pendens as pending suit. Lis means a suit, action, controversy, or dispute, and dispute is a conflict or contest, while controversy is a disputed question, a suit at law; and the ‘pendens’ of the lis is not disturbed on in any manner affected by the fact of an appeal taken from one Court to another. The litigation or contest still goes on.

The principle of lis pendens embodied in Section 52 of the act being a principle of public policy, no question of good faith or bona fide arises. Such being the position the transferee from one of the parties to the suit cannot assert or claim any title or interest averse to any of the rights and interests acquired by the another party under the decree in suit. The principle of lis pendens has the object to prevent anything done by the transferee from operating adversely to the interest declared by the decree.[4]

Moreover, it is also important to understand that the doctrine does not becomes eradicated when the suit is disposed. It still remains into existence till the time when the suit is dismissed and an appeal is not yet filed, thus leaving no loophole to prejudice any party to the suit. The explanation to the Section makes it very clear that the suit shall be deemed to have started from the date while the plaint will be supplied in the court and shall continue to exist until the time such proceeding has been decided by final order.

Concept Of Rule Of Lis Pendens

Basis of rule of lis pendens:

Doctrine of lis pendens is based on legal maxim ‘ut lite pendente nihil innovetur’ which means during a litigation nothing new should be introduced. And the principle on which it rests is explained in Bellamy v. Sabine[5].

Lord Chancellor Cranworth in the abovementioned case pronounced that:
It is scarcely correct to speak of lis pendens as affecting the purchaser through the doctrine of notice, though undoubtedly the language of the courts often so describes its operation. It affects him not because it amounts to notice, but because the law does not allow litigant parties to give to others pending the litigation rights to the property in dispute so as to prejudice the opposite party.

The necessities of mankind require that the decision of the court in the suit shall be binding not only on the litigant parties, but also on those who derive title under them by alienation made pending the suit, whether such alienus had or had not notice of the pending proceedings. If this were not so there could be no certainty that the litigation would ever come to an end and said that:
The foundation for the doctrine of lis pendens does not rest upon notice, actual or constructive; it rests solely upon necessity-the necessity, that neither party to the litigation should alienate the property in dispute so as to affect his opponent.

The doctrine of lis pendens has been fully expounded by the Privy Council in this case of Faiyaz Hussain Khan v Prag Narain[6] where their lordships quoted with approval of Lord Justice Turner in Bellamy’s case. It has been held that the foundation for the doctrine does not rest upon notice; it rests solely upon necessity- the necessity that neither party should alienate the property in dispute so that you can affect his opposite parties.[7]

Meaning:
The doctrine of lis pendens incorporated under Section 52 of the 1929 Act, means to say that During the pendency 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.

The Supreme Court in Jayaram Mudaliar v. Ayyaswami,[8] and Rajendnr Singh v. Santa Singh,[9] founded the following definition:
lis pendens literally means a pending suit, and the doctrine of lis pendens has been defined as the jurisdiction, power, or control which a court acquires over property involved in a suit pending the continuance of the action, and until final judgment therein.

As was observed by the Supreme Court in Jayaram's case:
Expositions of the doctrine indicate that the need for it arises from the very nature of the jurisdiction of Courts and their control over the subject-matter of litigation so that parties litigating before it may not remove any part of the subject-matter outside the power of the Court to deal with it and thus make the proceedings infructuous.

Essential conditions:
The Supreme Court in Amit Kumar Shaw v Farida Khatoon,[10] restated the elements required for the applicability of rule of lis pendens stimulated from Section 52[11].

The essentials are as follows:
  1. There must be a suit or proceedings pending in a court of competent jurisdiction;

    For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force.[12]
     
  2. Suit or proceedings must not be collusive;

    In Nagubai v. B. Sham Rao[13], Venkatarama Aiyyar, J., while explaining the distinction between a collusive and a fraudulent proceeding, observed: In such (collusive) proceeding a claim put forward is fictitious, the contest over it is unreal, and the decree passed therein is a mere mask having the similitude of a judicial determination and worn by the parties with the object of confounding third parties. But when a proceeding is alleged to be fraudulent, what is meant that the claim made therein is untrue, but the claimant has managed to obtain the verdict of the court in his favor and against his opponent by practicing fraud on the court. While in a collusive proceeding the contest is a mere sham, in a fraudulent suit it is real and earnest.
    Moreover, The rule of lis pendens does not apply to a collusive suit or a suit in which the decree is obtained by fraud or collusion, as held in the case of Awadesh Prasad v. Belarani.[14]
     
  3. The litigation must be one in which right to immovable property is directly and specifically in question;
  4. There must be a transfer of property in dispute by any party to litigation;
  5. Such transfer must affect the rights of other party that may ultimately accrue under the terms of decree or order.

Judicial Precedents on doctrine of lis pendens:

  1. The principle on which the doctrine of lis pendens rests is explained in the leading case of Bellamy v. Sabine,[15] where Turner, L.J. observed:
    It is as I think, a doctrine common to the courts both of Law and Equity, and rests, as I apprehend, upon this foundation that it would plainly be impossible that any action or suit could be brought to a successful termination, if alienations pendente litewere permitted to prevail. The plaintiff would be liable in every case to be defeated by the defendant's alienating before the judgment or decree, and would be driven to commence his proceedings de novo, subject again to be defeated by the same course of proceeding.
     
  2. In Simla Banking Industrial Co. Ltd. v. Firm Luddar Mal,[16] Tek Chand, J., on the effect of judgement upon parties to alienation during pending suit said that:
    The rule of lis pendens lays down that whoever purchases a property during the pendency of an action, is held bound by the judgment that may be made against the person from whom he derived his title (to the immovable property, the right to which is directly and specifically in question in the suit or proceeding) even though such a purchaser was not a party to the action or had no notice of the pending litigation. The intention of the doctrine is to invest the Court with complete control over alienations in the res which is pendente lite, and thus to render its judgment binding upon the alienees, as if they were parties, notwithstanding the hardship in individual cases.
     
  3. In KN Aswathnarayana Setty v. State of Karnataka & Ors[17], Dr. B.S. Chauhan, J. expressed the meaning of lis pendens by saying that:
    The principle of ‘lis pendens’ is in accordance with the equity, good conscience and justice because they rest upon an equitable and just foundation that it will be impossible to bring an action or suit to a successful termination if alienations are permitted to prevail. A transferee pendente lite is bound by the decree just as much as he was a party to the suit. A litigating party is exempted from taking notice of a title acquired during the pendency of the litigation.

    However, it must be clear that mere pendency of a suit does not prevent one of the parties from dealing with the property constituting the subject matter of the suit. The law simply postulates a condition that the alienation will, in no manner, affect the rights of the other party under any decree which may be passed in the suit unless the property was alienated with the permission of the Court. The transferee cannot deprive the successful plaintiff of the fruits of the decree if he purchased the property pendente lite.
     
  4. In Hardev Singh v. Gurmail Singh[18], the Supreme Court observed that
    Section 52 of the Act does not declare a pendente lite transfer by a party to the suit as void or illegal, but only makes the pendente lite purchaser bound by the decision of the pending litigation. Thus, if during the pendency of any suit in a court of competent jurisdiction which is not collusive, in which any right of an immovable property is directly and specifically in question, such immovable property cannot be transferred by any party to the suit so as to affect the rights of any other party to the suit under any decree that may be made in such suit.
     
  5. In T.G. Ashok Kumar v. Govindammal & Anr.[19], the Supreme Court observed that:
    If the title of the pendente lite transferor is upheld in regard to the transferred property, the transferee’s title will not be affected. On the other hand, if the title of the pendente lite transferor is recognized or accepted only in regard to a part of the transferred property, then the transferee’s title will be saved only in regard to that extent and the transfer in regard to the remaining portion of the transferred property will be invalid and the transferee will not get any right, title or interest in that portion. If the property transferred pendente lite, is entirely allotted to some other party or parties or if the transferor is held to have no right or title in that property, the transferee will not have any title to the property.
     
  6. In Rajender Singh and Ors. v. Santa Singh and Ors.[20], it was observed by the Supreme Court that:
    The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a Court, in which a dispute on rights or interests in immovable property is pending, by private dealings which may remove the subject matter of litigation from the ambit of the court's power to decide a pending dispute or frustrate its decree.

    Alienees acquiring any immovable property during pending litigation, are held to be bound by an application of the doctrine, by the decree passed in the suit even though they may not have been impleaded in it. The whole object of the doctrine of lis pendens is to subject parties to the litigation as well as others, who seek to acquire rights in immovable property, which are the subject matter of litigation, to the power and jurisdiction of the Court so as to prevent the object of a pending action from being defeated.
     
  7. In Gouri Dutt Maharaj v. Sheikh Sukur Mohammed and Ors.[21], it was held that:
    The broad principle underlying Section 52 of the Transfer of Property Act,1882 is to maintain status quo, unaffected by act of any party to the pending litigation.
     
  8. In Ramjidas v. Laxmi Kumar and Ors.[22], the Madhya Pradesh Court observed that:
    The purpose of Section 52 is not to defeat any just and equitable claim but only to subject them to the authority of Court which is dealing with the property to which the claims are put forward.

It can be concluded that the principles contained in Section 52 of Transfer of Property Act are in harmony with the principle of equity, good conscience or justice, because they rest upon an equitable and just foundation, that it will be impossible to bring an action or suit to a successful termination if alienations are permitted to prevail. Allowing alienations made during pendency of a suit or an action to defeat rights of a Plaintiff will be paying premium to cleverness of a Defendant and thus defeat the ends of justice and throw away all principles of equity.[23]

The essence of this Section is that a transaction made during the pendency of a suit by a party to the suit cannot prejudice the interest of the other party. Therefore, the sale in the instant case in favor of the review applicant will be valid to the extent it does not affect the right of the opposite party, if any, determined or to be determined in title suit.[24] Moreover, as Doctrine of lis pendens is in compliance with justice, equity and good conscience, it will also be applied where Transfer of Property Act is inapplicable, with an objective to prevent the right of the deserved party from being curbed by another.

End-Notes:
  1. H.W.R. Wade and Forsyth, Administrative Law 7th Edn., p. 579 (Oxford University Press 2014
  2. Law commission of India 157th Report on Section 52 of Transfer of Property Act 1882 and its Amendments, April 1988.
  3. Govinda Pillai v. Aiyyapan Krishnan, AIR 1957 Ker 10, para. 7
  4. Mohd. Ali v. Abdulla, AIR 1973 Mys 131 (DB)
  5. (1857) 1 De G & J 566
  6. (1907) 29 All. 389.
  7. Supra 3
  8. AIR 1973 SC 569, para. 47
  9. AIR 1973 SC 2537
  10. AIR 2005 SC 2209; (2005) 11 SCC 403
  11. Section 52 of Transfer of Property Act, 1882.
  12. Ibid
  13. (1956) SCR 451
  14. ILR 33 Pat. 389
  15. Supra 5
  16. AIR 1959 Punj 490
  17. AIR 2014 SC 279
  18. (2007) 2 SCR 141
  19. LQ 2009 HC 16944
  20. AIR 1973 SC 2537
  21. AIR 1948 PC 147
  22. AIR 1987 MP 78
  23. Lov Raj Kumar vs. Major Daya Shankar, AIR 1986 Delhi 364
  24. Usha Rani Banik v Haridas Das, AIR 2005 Gau. 1.

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