Corpus Possession & Permissible Possession

Corpus Possession means that there exists such physical contact of the thing by the possessor as to give rise to the reasonable assumption that other person will not interfere with it. Existence of corpus broadly depends on (1) upon the nature of the thing itself, and the probability that others will refrain from interfering with the enjoyment of it; (2) possession of real property, i.e., when a man sets foot over the threshold of a house, or crosses the boundary line of his estate, provided that there exist no factors negativing his control, for example the continuance in occupation of one who denies his right; and (3) acquisition of physical control over the objects it encloses. Corpus, therefore, depends more upon the general expectations that others will not interfere with an individual control over a thing, then upon the physical capacity of an individual to exclude others.

The animus possidendi is the conscious intention of an individual to exclude others from the control of an object.

There is also a concept of “constructive possession” which is depicted by a symbolic act. It has been narrated with an illustration that delivery of keys of a building may give right to constructive possession of all the contents to the transferee of the key.

A person other than the owner, if continued to have possession of immoveable property for a period as prescribed in a Statute providing limitation, openly, without any interruption and interference from the owner, though he has knowledge of such possession, would crystallize in ownership after the expiry of the prescribed period of limitation, if the real owner has not taken any action for reentry and he shall be denuded of his title to the property in law. “Permissible Possession” shall not mature a title since it cannot be treated to be an “adverse possession”. Such possession for however length of time be continued, shall not either be converted into adverse possession or a title. It is only the hostile possession which is one of the condition for adverse possession. Bhikhari v. D.D.C., 2018 (141) RD 130.

 

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Permanent Alimony – After Passing of Divorce Decree

In the event permanent alimony has not been granted probably for the reason that no such application was moved and pressed for, the same can be applied even after passing of the decree. Section 25 of the Hindu Marriage Act itself envisages that the wife can initiate proceedings for grant of permanent alimony even after the decree of divorce. Therefore, the court does not become functus officio with the passing of the decree and continues to have jurisdiction to award alimony thereafter. Smt. Poonam Sharma v. Vishnu Kumar, 2018 (130) ALR 490.

 

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Charitable – Meaning of

Black’s Law Dictionary, 9th Edition defines “charitable”, “charitable purpose”, “charitable corporation” and “Charitable trust” thus:

“charitable, adj. (1) Dedicated to a general purpose, usually for the benefit of needy people who cannot pay for the benefits received.”

“Charitable Purpose.—The purpose for which an organization must be formed so that it qualifies as a charitable organization under the Internal Revenue Code.—Also termed charitable use.”

“Charitable Corporation.—A non-profit corporation that is dedicated to benevolent purposes and thus entitled to special tax status under the Internal Revenue Code.—Also termed eleemosynary corporation.”

“Charitable Trust.—A trust created to benefit a specific charity, specified charities, or the general public rather than a private individual or entity. Charitable Trusts are often eligible for a favourable tax treatment. If the Trust’s terms do not specify a charity or a particular charitable purpose, a court may select a charity.—Also termed public trust; charitable use.”

In Webster’s New World Dictionary, the expressions “charitable” and “charity” are defined thus:

“Charitable.—1. Kind and generous in giving money or other help to those in need.

  1. of or for charity.
  2. Kindly in judging others; lenient.

Charity.—1. In Christianity, the love of God for man or of man for his fellow men. 2. An act of goodwill or affection. 3. The feeling of goodwill; benevolence. 4. The quality of being kind or lenient in judging others. 5. A giving of money or other help to those in need; benefaction. 6. An institution, organization, or fund for giving help to those in need.”

In Incorporated Council of Law Reporting for England and Wales v. Attorney General, (1971) 3 WLR 853, it was observed that when a purpose has been proved to be of general public welfare or beneficial to the community, it will be held to be charitable unless there is some reason for holding that it is not within the spirit and intendment of the Preamble.

In Jones v. Williams, 27 ER 422, it was held thus: “Charity to be a gift to a general public use, which may extend to the poor as well as to the rich. It embraces all that is usually understood by the words “benevolence”, “Philanthropy” and “good will”. A gift to a home for the friendless is a gift to charity. Union of India v. Moolchand Khairati Ram Trust, (2018) 8 SCC 321.

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Applicability of Arbitration & Conciliation Act, 1996

Sub-section (1) of Section 85 of the Arbitration and Conciliation Act, 1996 repealed three enactments including the Arbitration Act, 1940. Sub-section (2) stipulates, inter alia, that notwithstanding such repeal, the repealed enactment, namely, the 1940 Act would continue to apply in relation to arbitral proceedings which had commenced before the 1996 Act came into force unless the parties were to agree otherwise. The second limb of first clause of said sub-section (2) further stipulates that notwithstanding such repeal, the provisions of the 1996 Act would apply in relation to arbitral proceedings which commenced on or after the 1996 Act came into force.

As is clear from MMTC Ltd. v. Sterlite Industries (India) Ltd., (1996) 6 SCC 716, what is material for the purposes of the applicability of the 1996 Act is the agreement between the parties to refer the disputes to arbitration. If there be such an arbitration agreement which satisfies the requirements of Section 7 of the 1996 Act, and if no arbitral proceeding had commenced before the 1996 Act came into force, the matter would be completely governed by the provisions of the 1996 Act. Any reference to 1940 Act in the arbitration agreement would be of no consequence and the matter would be referred to arbitration only in terms of the 1996 Act consistent with the basic intent of the parties as discernible from the arbitration agreement to refer the disputes to arbitration.

In situations where the relevant clause made reference to the applicability of “the provisions of the Indian Arbitration Act and Rules made thereunder” as was the case in MMTC Ltd. v. Sterlite Industries (India) Ltd., (1996) 6 SCC 716, on the strength of Section 85(2)(a) the governing provisions in respect of arbitral proceedings which had not commenced before 1996 Act had come into force would be those of the 1996 Act alone. On the same reasoning even if an arbitration agreement entered into after the 1996 Act had come into force were to make a reference to the applicable provisions of those under Indian Arbitration Act or the 1940 Act, such stipulation would be of no consequence and the matter must be governed under the provisions of the 1996 Act. An incorrect reference or recital regarding applicability of the 1940 Act would not render the entire arbitration agreement invalid. Such stipulation will have to be read in the light of Section 85 of the 1996 Act and the principles governing such relationship have to be under and in tune with the 1996 Act. Purushottam v. Anil, (2018) 8 SCC 95.

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Transfer of – Right, Title or Interest in Tangible Property

It is a settled principle of law that a person can only transfer to other person a right, title or interest in any tangible property which he is possessed of to transfer it for consideration or otherwise. In other words, whatever interest a person is possessed of in any tangible property, he can transfer only that interest to the other person and no other interest, which he himself does not possess in that tangible property. So, once it is proved that on the date of transfer of any tangible property, the seller of the property did not have any subsisting right, title or interest over it, then a buyer of such property would not get any right, title and interest in the property purchased by him for consideration or otherwise. Such transfer would be an illegal and void transfer. In such eventuality and subject to any terms and conditions, if agreed between the parties, a buyer will have a right to claim refund of sale consideration from his seller, which he paid for purchase of the property under the law of contract. The reason is that the contract to purchase has failed and, therefore the parties have to be restored back to their original positions, which existed at the time of execution of the contract. Eureka Builders v. Gulabchand¸(2018) 8 SCC 67

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Valid Arbitration Agreement – Pre-Requisites of

Para 22 of the judgment in P. Dasaratharama Reddy Complex v. State of Karnataka, (2014) 2 SCC 201 is important and sets out from K.K. Modi v. K.N. Modi, (1998) 3 SCC 573 as to what are the valid pre-requisites for a valid arbitration:

“One of the questions formulated by the Court was whether clause 9 of the memorandum of understanding constituted an arbitration agreement and whether the decision of the Chairman, IFCI constituted an award. It was held as under:

“(1) The arbitration agreement must contemplate that the decision of the tribunal will be binding on the parties to the agreement,

(2) That the jurisdiction of the tribunal to decide the rights of the parties must derive either from the consent of the parties or from an order of the court or from a Statute, the terms of which make it clear that the process is to be an arbitration,

(3) The agreement must contemplate that substantive rights of parties will be determined by the agreed tribunal,

(4) That the tribunal will determine the rights of the parties in an impartial and judicial manner with the tribunal owing an equal obligation of fairness towards both sides,

(5) That the agreement of the parties to refer their disputes to the decision of the tribunal must be intended to be enforceable in law and lastly,

(6) The agreement must contemplate that the tribunal will make a decision upon a dispute which is already formulated at the time when a reference is made to the tribunal.

The other factors which are relevant include, whether the agreement contemplates that the tribunal will receive evidence from both sides and hear their contentions or at least give the parties an opportunity to put them forward; whether the wording of the agreement is consistent or inconsistent with the view that the process was intended to be an arbitration, and whether the agreement requires the tribunal to decide the dispute according to law.

In Bihar State Mineral Development Corporation v. Encon Builders (India) (P) Ltd., (2003) 7 SCC 418, it was held that a clause which is inserted in an agreement for the prevention of a dispute, will not be an arbitration agreement. Shyam Sunder Agarwal v. P. Narotham Rao, (2018) 8 SCC 230.

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No Right to Forfeit the Sum – In the Absence of Forfeiture Clause

A right to forfeit being a contractual right and penal in nature, the parties to a contract must agree to stipulate a term in the contract in that behalf. A fortioti, if there is no stipulation in the contract of forfeiture, there is no such right available to the party to forfeit the same.

The learned author Sir Kim Lewison in his book The Interpretation of Contracts (6th Edn.) while dealing with the subject “Penalties, Termination and Forfeiture Clauses in the Contract” explained the meaning of the expression “forfeiture” in these words:

“A forfeiture clause is a clause which brings an interest to a premature end by reason of a breach of covenant or condition, and the court will penetrate the disguise of a forfeiture clause dressed up to look like something else. A forfeiture clause is not to be construed strictly, but is to receive a fair construction.”

In Doe D Davis v. Elsam, 1828 M&M189 : 173 ER 1126, Lord Tenterden held as under, :

“I do not think provisos of this sort are to be construed with the strictness of conditions at common law. These are matters of contract between the parties, and should, in my opinion, be construed as other contracts.”

Equally well settled principle of law relating to contract is that a party to the contract can insist for performance of only those terms/conditions, which are part of the contract. Likewise, a party to the contract has no right to unilaterally “alter” the terms and conditions of the contract and nor they have a right to “add” any additional terms/conditions in the contract unless both the parties agree to add/alter any such terms/conditions in the contract.

Similarly, if any party adds any additional terms/conditions in the contract without the consent of the other contracting party then such addition is not binding on the other party. Similarly, a party, which adds any such term/condition, has no right to insist on the other party to comply with such additional terms/conditions and nor such party has a right to cancel the contract on the ground that the other party has failed to comply with such additional terms/conditions. Suresh Kumar Wadhwa v. State of M.P., (2017) 16 SCC 757.

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