Category Archives: Family Settlement

Family Arrangement – Object of

In Kale v. Director of Consolidation, (1976) 3 SCC 119, it was held as under:
“By virtue of a family settlement or arrangement members of a family descending from a common ancestor or a near relation seek to sink their differences and disputes, settle and resolve their conflicting claims or disputed titles once for all in order to buy peace of mind and bring about complete harmony and goodwill in the family. The family arrangements are governed by a special equity peculiar to themselves and would be enforced if honestly made.
The object of the arrangement is to protect the family from long drawn litigation or perpetual strifes which mar the unity and solidarity of the family and create hatred and bad blood between the various members of the family. A family arrangement by which the property is equitably divided between the various contenders so as to achieve an equal distribution of wealth instead of concentrating the same in the hands of a few is undoubtedly a milestone in the administration of social justice. That is why the term ‘family’ has to be understood in a wider sense so as to include within its fold not only close relations or legal heirs but even those persons who may have some sort of antecedent title, a semblance of a claim or even if they have spes successionis so that future disputes are sealed forever and the family instead of fighting claims inter se and wasting time, money and energy on such fruitless or futile litigation is able to devote its attention to more constructive work in the larger interest of the country. Rajni Sanghi v. Western India State Motors Ltd., (2015) 16 SCC 631.

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Family Settlement – Essentials of

To put binding effect and the essentials of a family settlement in a concretized form, the matter may be educed into the form of following propositions:
(1) The family settlement must be bona fide one so as to resolve family disputes and rival claims by a fair and equitable division or allotment of properties between the various members of the family.
(2) The said settlement must be voluntary and should not be induced by fraud, coercion or undue influence.
(3) The family arrangement may be oral even in which case no registration is necessary.
(4) It is well settled that registration would be necessary only if the terms of the family arrangements are reduced into writing. Here also, a distinction should be made between a document containing the terms and recitals of a family arrangement made under the document and a mere memorandum prepared after the family arrangement had already been made either for the purpose of the record or for information of the Court for making necessary mutation. In such a case the memorandum itself does not create or extinguish any rights in immovable properties and therefore does not fall within the mischief of Section 17(2) of the Registration Act and is, therefore, not compulsorily registrable.
(5) The members who may be parties to the family arrangement must have some antecedent title, claim or interest, even a possible claim in the property which is acknowledged by the parties to the settlement. Even if one of the parties to the settlement has not title but under the arrangement the other party relinquishes all its claims or titles in favour of such a person and acknowledges him to be the sole owner, then the antecedent title must be assumed and the family arrangement will be upheld and the courts will find no difficulty in giving assent to the same.
(6) Even if bona fide dispute, present or possible, which may not involve legal claims are settled by a bona fide family arrangement which is fair and equitable is final and binding on the parties to the settlement. Smt. Rama Devi v. Mahendra Pal, 2016 (114) ALR 852.

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