IN THE SUPREME COURT OF PAKISTAN
(Appellate Jurisdiction)
Present:
MR. JUSTICE SAYYED MAZAHAR ALI AKBAR NAQVI
MR. JUSTICE MUHAMMAD ALI MAZHAR
MR. JUSTICE SHAHID WAHEED
CIVIL PETITION NO.1133-L OF 2016
(Against the judgment dated 15.02.2016
passed by Lahore High Court, Lahore in Civil
Revision. No. 997/2010)
Rao Abdul Rehman (deceased) through legal heirs …Petitioner
Versus
Muhammad Afzal (deceased) through legal heirs and others
...Respondents
For the Petitioner: Agha Muhammad Ali, ASC
For the Respondents 2 to 5: Mr. Jam Khursheed Ahmed, ASC
Date of Hearing: 16.01.2023
JUDGMENT
MUHAMMAD ALI MAZHAR, J. This civil petition for leave to appeal is
directed against the judgment dated 15.02.2016 passed by the learned
Lahore High Court, Lahore in Civil Revision No.997 of 2010 whereby
the revision application filed by the petitioner was dismissed.
2. The transient features of the case are that Muhammad Feroz
(deceased) and Muhammad Afzal (respondent No.1) were the owners of
10 Marlas according to Khewat No. 621, Khatuni No.579, Qilla
Numbers 15/3, 16/2/2/, 16/3/1 in the land situated at village
Bherowal, Tehsil Phalia, District Mandi Baha-ud-Din. (“Suit
property”). On 19.03.2008, the petitioner filed Civil Suit No.59/2008
for declaration with an alternate prayer for decree of specific
performance of an agreement to sell dated 30.11.1993. In the aforesaid
suit the petitioner pleaded that he entered into an agreement to sell
with Muhammad Feroz (decd.) for the aforesaid property in lieu of sale
consideration amounting to Rs.1,60,000/- out of which Rs.70,000/-
was paid in the presence of witnesses as earnest money while the
CP.No.1133-L/2016 2
remaining amount was agreed to be paid on 18.01.1994, subject to
which the sale deed would be executed. It was further alleged that on
17.01.1994 the respondents received the remaining consideration,
thus completing the sale and executed another agreement on the same
date i.e. 17.01.1994 with the condition that a registered deed and/or
mutation in favour of the petitioner would be executed at the
petitioner’s desire. The petitioner demolished the old structure
constructed on the property. It was further contended that after the
death of Muhammad Feroz (vendor) his heirs resiled from the
agreement to sell, hence the petitioner filed a civil suit. The suit was
contested by the respondents and they filed written statements to the
effect that both the agreements to sell are forged and the suit is also
time-barred. On the contrary, the evidence led by the respondent No.2
divulges that due to registration of FIR against the respondents in a
murder case, they left the village and during their absence, the
petitioner encroached upon the plot. After recording the evidence, the
Trial Court decreed the suit to the extent of declaration, but declined
the relief of specific performance of the alleged agreements. The
respondents filed an Appeal which was accepted by the Appellate
Court and as a consequence thereof, the judgment of the Civil Court
was set aside. Being aggrieved, the petitioner filed a Civil Revision in
the Lahore High Court which was dismissed vide Judgment dated
15.02.2016.
3. The learned counsel for the petitioner argued that the transaction
was completed after the vendors had received the sale consideration
and handed over the possession of the suit property to the vendee and
since then the petitioner was in peaceful possession of the property in
dispute. It was further contended that the learned Additional District
Judge as well as the learned High Court failed to appreciate the
evidence. He further argued that the non-signing of the agreement by
the vendee was of no consequence when the agreement was signed by
the vendor. It was further contended that the sale agreements were
proved in evidence despite the fact that the marginal witnesses had
died, but the Appellate Court and High Court ignored the evidence
available on record. Finally, the learned counsel averred that the
learned High Court relied on the dictum laid down by this Court in the
case of Farzand Ali & another Vs. Khuda Bakhsh & others (PLD 2015
SC 187), which was subsequently revisited by this Court in the case of
Muhammad Sattar and others Vs. Tariq Javaid and others (2017
CP.No.1133-L/2016 3
SCMR 98), hence the reliance placed by the learned High Court on
Farzand Ali case was ill-founded.
4. The learned counsel for the respondents, while supporting the
judgment of the learned Appellate Court and High Court, argued that
the judgment and decree passed by the learned Trial Court was
against law and facts. He further argued that the learned Trial Court
failed to appreciate the evidence, including the documents of
Mutations No. 2301 and 130 dated 23.02.2008 and 18.04.1974. He
further argued that due to the registration of a criminal case, the
respondents were out of the village and also denied having handed
over possession of the suit property to the petitioner. He further
argued that when the respondents had run away from the vicinity,
then the question of receiving the remaining sale consideration did not
arise. He further argued that no agreement was signed by the
respondent No.1 who is a co-owner of the property in question, hence
in his absence the alleged agreement was otherwise not enforceable
and the learned Trial Court itself declared that the agreements were
not proved, but under misconception of law granted the declaratory
decree which was rightly set aside by the learned Appellate Court.
5. Heard the arguments. The gist of the evidence led in the Trial Court
reflects that the petitioner adduced evidence as PW-1 and produced
Muhammad Abdullah and Matloob Ahmad as PW-2 and PW-3. The
alleged agreements were produced as Ext.P/1 and Ext.P/2 along with
some other documents, including a copy of the Khasra Girdawari as
Ex.P/9 and a copy of the record of rights from 2004-2005 as Ex.P/10,
whereas from the respondents’/defendants’ side, Zafar Iqbal appeared
as DW-1 and Sultan Ali as DW-2. They produced Mutation No.130
dated 18.04.1974 as Ex.D/1 and Mutation No.2361 dated 23.02.2008
as Ex.D/2, along with a copy of the record of rights from 2004-2005 as
Ex.D/3. The learned Trial Court decreed the suit with regard to
declaration alone but declined the decree of specific performance. The
property in question was measured as 10 Marlas and was jointly
owned by Muhammad Feroz and Muhammad Afzal in equal shares.
The petitioner in his evidence admitted that the agreement was
entered into 1993, but he did not know who the owner of the entire
property was and did not check whether Muhammad Feroz was the
absolute owner of the property measuring 10 Marlas, but it was an
admitted fact that Muhammad Feroz was the owner of 5 Marlas only.
CP.No.1133-L/2016 4
It is also a matter of record that the petitioner claimed to be unaware
that the respondents were proclaimed offenders but admitted that they
had slipped away. The Civil Suit was filed after 13 years of the
execution of the agreements, and at least two years after it came into
the knowledge of the petitioner that the whole property was not owned
by Muhammad Feroz (decd.). The learned Appellate Court after
scanning and reevaluating the entire evidence, rightly reached the
conclusion that the agreements were not proved and, in addition, it
was further observed that the co-owner Muhammad Afzal never signed
the agreements mainly for the reason that the respondents were
involved in a murder case, hence they had escaped from Bherowal and
during that period, the petitioner illegally occupied the property
without ascertaining the proper description of the property as well as
its ownership and maintained silence for more than thirteen years.
The learned counsel for the petitioner failed to identify any mis-reading
or non-reading of evidence or any other material defect in the
impugned judgment.
6. It is clear from the chronology of the case that in order to effectively
implement or execute the agreements dated 30.11.1993 and
17.01.1994, the petitioner filed the suit for declaration and in
alternate decree for specific performance on 19.03.2008, at which
point Muhammad Feroz (vendor) had already died. Neither any legal
proceedings were initiated by the petitioner during the life time of
Muhammad Feroz for properly transferring the title of the property
pursuant to the alleged sale agreements, nor did he offer any plausible
reason which may justify his act or omission of not approaching a
court of law for the implementation of the agreements at the relevant
time. According to Section 54 of the Transfer of Property Act 1882,
“sale” means the transfer of ownership in exchange for a price paid or
promised or part paid and part promised which is made in the case of
tangible immovable property of the value of one hundred rupees and
upwards or in the case of a reversion or other intangible thing, can be
made only by a registered instrument with further rider that a contract
for the sale of immovable property is a contract that a sale of such
property shall take place on terms settled between the parties but it
does not, of itself, create any interest in or charge on such property.
Whereas under Section 42 of the Specific Relief Act 1877, a person
entitled to any legal character or to right as to any property, may
institute a suit against any person denying, or interested to deny, his
CP.No.1133-L/2016 5
title to such character or right and the Court may in its discretion
make therein a declaration that he is so entitled, and the plaintiff need
not in such suit ask for any further relief, but according to the
attached proviso, no Court shall make any such declaration where the
plaintiff, being able to seek further relief than mere declaration of title,
omits to do so. The expression “legal character” has been understood
to be synonymous with the expression status. A suit for mere
declaration is not permissible except in the circumstances mentioned
in Section 42 of the Specific Relief Act. The claim of mere declaration
as to alleged title does not suffice. It is clear that in the present lis, the
petitioner was claiming the title merely on the strength of the
agreement to sell by one co-owner while the other co-owner never
signed any such agreement so it is quite strange that the learned Trial
Court, though it dismissed the suit for specific performance on the
ground that agreements to sell were not proved, but concomitantly
decreed the suit to the extent of declaration which is on the face of it a
glaring and patent legal and factual error that was rightly corrected by
the learned Appellate Court. On the basis of a sale agreement, no legal
character or right can be established to prove the title of the property
unless the title is transferred pursuant to such agreement to sell, but
in case of denial or refusal by the vendor to specifically perform the
agreement despite the readiness and willingness of the vendee, a suit
for specific performance may be instituted in the court, but suit for
declaration on the basis of a mere sale agreement is not the solution
for appropriate relief. This Court in the case of Muhammad Yousaf Vs
Munawar Hussain and others (2000 SCMR 204), held that the
agreement to sell by itself cannot confer any title on the vendee
because the same is not a title deed and such agreement does not
confer any propriety right, and thus, it is obvious that the declaratory
decree as envisaged by section 42 of the Specific Relief Act cannot be
awarded because declaration can only be given in respect of a legal
right or character. The only right arising out of an agreement to sell is
to seek its specific performance.
7. Under Section 22 of the Specific Relief Act, the exercise of
jurisdiction by the Court for decreeing the suit for specific performance
of contract is discretionary in nature in which the Court is not bound
to grant such relief, but in tandem the discretion is not to be exercised
arbitrarily but should be based on sound legal principles after
analyzing and gauging the circumstances, inter alia, whether the
CP.No.1133-L/2016 6
contract is such which gives an unfair advantage to the plaintiff over
the defendant or the performance of the contract encompasses some
hardship on the defendant which he could not foresee or whether its
non-performance would embroil some hardship to the plaintiff and
whether the plaintiff has done substantial acts or suffered losses in
consequence of a contract capable of specific performance. The person
seeking specific performance has to establish that he is enthusiastic
and vehement to act upon his obligations as per the contract but the
opponent is refusing or delaying its execution. So far as the limitation
period for the institution of a lawsuit against non-performance is
concerned, the starting point of limitation under Article 113 of
Limitation Act, 1908 for institution of legal proceedings enunciates
two limbs and scenarios. In the first segment, the right to sue
accrues within three years if the date is specifically fixed for
performance in the agreement itself whereas in its next fragment,
the suit for specific performance may be instituted within a period of
three years from the date when plaintiff has noticed that
performance has been refused by the vendor but in both scenarios,
the right to sue has not been left open ended. In the present case,
according to the petitioner the cause of action accrued when legal
heirs of Muhammad Feroz declined to acknowledge the alleged
agreements signed by their predecessor, therefore, the suit was not
time barred. Obviously, the first part of Article 113 of the Limitation
Act refers to the exactitudes of its application when time is of the
essence of the contract, which means an exact timeline was fixed for
the performance of obligations arising out of the contract/agreement
hence, in this particular situation, the limitation period or starting
point of limitation will be reckoned from that date and not from date
of refusal, however, if no specific date was fixed for performance of
agreement and time was not of the essence, then the right to sue
will accrue from the date of knowledge about refusal by the
executant. Ref: Khudadad Vs Syed Ghazanfar Ali Shah alias S.
Inaam Hussain and others (2022 SCMR 933).
8. It is also translucent from the impugned judgment of the learned
High Court dated 15.2.2016 that while taking into consideration all
relevant facts and evidence led in the Trial Court, including the finding
of the Appellate Court, the learned High Court has also referred to the
judgment in the case of Farzand Ali and another Vs Khuda Bakhsh
and others (PLD 2015 SC 187) (two member bench) rendered by this
CP.No.1133-L/2016 7
Court on 01.01.2015, which was at the relevant time in field as a
binding precedent under Article 189 of the Constitution of Pakistan
1973 which enunciated a principle of law vis-à-vis the doctrine of
contract. Indeed in the case of Farzand Ali, while placing reliance on
the judgment of Mst. Gulshan Hamid v. Kh. Abdul Rehman and others
(2010 SCMR 334) (three members bench), this Court held that in a
suit for specific performance, the agreement to sell cannot be enforced
if the vendee has not signed the agreement and such unilateral
agreement not signed by plaintiff-vendee was not mutually
enforceable, whereupon no decree could be passed. However, the
subsequent judgment rendered by the five member bench of this Court
on 11.11.2016 in the case of Muhammad Sattar and others Vs Tariq
Javaid and others (2017 SCMR 98) depicts that during the course of
arguments before a five member bench of this Court, profound reliance
was laid down on the dictum of Farzand Ali (supra) with an attempt to
persuade the bench to hold that an agreement to sell not signed by the
vendee was not enforceable in law. While expatiating all factual and
legal issues embroiled in the lis and under the dominion of judicial
review, this Court eventually reached the conclusion that an
agreement to sell not signed by one of the parties, if proved to have
been accepted and acted upon, would be a valid agreement to sell and
enforceable in law. It was further held that the proposition that where
an agreement to sell pertaining to immovable property is not signed by
one of the parties thereto is, in each and every eventuality, invalid and
not specifically enforceable is fallacious and contrary to the law. The
existence and validity of the agreement and it being specifically
enforceable or otherwise would depend upon the proof of its existence,
validity and enforceability in accordance with the Qanun-e-Shahadat
Order, 1984, the relevant provisions of the Contract Act, 1872, the
Specific Relief Act, 1877, and any other law applicable thereto.
9. In the aforesaid perspective, the doctrine of prospective overruling
is also quite relevant which originated in the American Judicial
System. The literal meaning of the term 'overruling' is to overturn or
set aside a precedent by expressly deciding that it should no longer be
a controlling law. Similarly 'prospective' means operative or effective in
the future. According to the dictum laid down in the case of Pakistan
Medical and Dental Council & others vs. Muhammad Fahad Malik &
others (2018 SCMR 1956) the judgments of this Court (Supreme
Court) unless declared otherwise operate prospectively. More or less,
CP.No.1133-L/2016 8
similar findings that the law laid down by this Court is prospective
which cannot be doubted have been recorded in the case of Sakhi
Muhammad and another vs. Capital Development Authority,
Islamabad (PLD 1991 S.C 777) and Pir Bakhsh and others vs.
The Chairman, Allotment Committee and others, (PLD 1987 S.C.
145).
10. Another crucial aspect is what constitutes a valid contract
between the parties for which undoubtedly one of the essential
conditions is consensus ad idem for settling all the terms of the
contract but, upon perusal of the alleged agreements to sell, we
have found that no proper description or even exact location was
mentioned to identify the suit property, instead the description of
the suit property was jotted down by the petitioner in the plaint
rather than in the alleged agreements. Fundamentally the phrase
“consensus ad idem” in the law of contract connotes and epitomizes a
meeting of the minds inured to describe the intention of the parties.
This also speaks of the set of circumstances where there is a reciprocal
understanding in the manifestation of the contract. Section 10 of the
Contract Act, 1872 does not exclude an oral contract from being
enforced, although in the case of an oral contract the clearest and
more satisfactory evidence would be required by the Court. Admittedly
the co-owner, Muhammad Afzal (respondent No.1), had neither signed
the alleged agreement, nor he was privy to the alleged sale agreements.
It is also an admitted position that the property was not partitioned by
metes and bounds which means that no specific portion of the
property was earmarked for signifying the specific share or location
which could be dealt with independently, including the sale of an
individual share out of the joint property. On this score or count also
there was no valid contract for the whole property and the agreements
were defective with inherent lacunas. According to Black’s Law
Dictionary (5th Edition), a ‘contract’ is “an agreement between two or
more persons which creates an obligation to do or not to do a
particular thing. Its essentials are competent parties, subject matter of
a legal consideration, mutuality of agreement and mutuality of
obligations.” Anson has defined the word contract in the following
words: “A contract consists in an actionable promise or promises.
Every such promise involves two parties, a promisor and promisee,
and an expression of a common intention and expectation as to the act
or forbearance promised”. Ref: Anson’s Law of Contract, 23rd Edition,
CP.No.1133-L/2016 9
by A.G. Guest, 1971, p. 23. According to Treitel, “A contract is an
agreement giving rise to obligations which are enforced or recognized
by law. The factor which distinguishes contractual from other legal
obligations is that they are based on agreement of the contracting
parties. This proposition remains generally true, in spite of the fact
that it is subject to a number of important qualifications.” Ref: G.H.
Treitel, The Law of Contract, Tenth Edition (1999) by Sir Guenter
Treitel, Sweet & Maxwell (1999), p. 1. (Source: Moitra’s Law of
Contract & Specific Relief, Fifth Edition). No doubt to constitute a valid
contract one of the conditions is “consensus ad idem” which must exist
with regard to the terms and conditions of the contract and, in case of
any ambiguity, it may adversely reflect on its very existence. In fact it
is a Latin term in the law of contract that means the existence of
meeting of minds of all parties involved which is the elementary
constituent for the enforcement and execution of a contract and in
case of no consensus ad idem there shall be no binding contract and in
case of any palpable inexactitude or obliviousness in the settled terms
and conditions then there shall be no probability to get a hold of any
outcome of such defective agreement. Where an effective and
enforceable contract is not structured by the parties, it is not the
domain or province of the Court to make out a contract for them but
the lis would be decided on the basis of terms and conditions agreed
and settled down in the contract. The decree for specific performance
may not be passed if the substratum of the contract suffers from
shortcoming or legal infirmities which renders the contract
unacceptable and unenforceable.
11. The petitioner in the Trial Court pleaded that he was not aware
that the subject property was a joint property. Here the doctrine of
Caveat emptor (“let the buyer beware”) also applies which is based on a
Latin phrase and for all intents and purposes lays down an obligation
on buyers to rationally and intelligently scrutinize status including the
clear title of the property before embarking into the transaction of sale.
This is a rudimentary doctrine stuck between vendor and vendee in all
contractual relationships and arrangements. According to Broom’s
Legal Maxims (Tenth Edition), Chapter IX, (page 528), the maxim
caveat emptor applies, with certain specific restrictions, not only to the
quality of, but also to the title to land which is sold, the purchaser is
generally bound to view the land and to inquire after and inspect the
title-deeds, at his peril if he does not. He does not use common
CP.No.1133-L/2016 10
prudence, if he relies on any other security. The ordinary course
adopted on the sale of real estates is that the seller submits his title to
the inspection of the purchaser, who exercises his own judgment, or
such other as he confides in, on the goodness of the title; and if it
should turn out to be defective, the purchaser has no remedy, unless
he take special covenant or warranty, provided there be no fraud
practiced on him to induce him to purchase. Whereas under Black’s
Law Dictionary (Sixth Edition), page 222, this maxim summarizes the
rule that a purchaser must examine, judge, and test for himself. This
maxim is more applicable to judicial sales, auctions, and the like, than
to sales of consumer goods where strict liability, warranty, and other
consumer protection laws protect the consumer-buyer. Caveat emptor,
qui ignorare non debuit quod jus alienum emit. Let a purchaser beware,
who ought not to be ignorant that he is purchasing the rights of
another. Let a buyer beware; for he ought not to be ignorant of what
they are when he buys the rights of another. While the Words and
Phrases (Permanent Edition), Volume 6A ( Pages 8 & 9), describes the
doctrine of caveat emptor as a rule of law that the purchaser buys at
his own risk. Wood v. Ross, Tex.Civ.App., 26 S.W. 148, 149. Under the
rule purchaser takes all the risks, being bound to examine and judge
for himself as to title of land purchased unless he is dissuaded from so
doing by representations of some kind. Kain v. Weitzel, 50 N.E.2d 605,
607, 72 Ohio App. 229. The maxim is used with reference to sales of
property with respect to which the buyer must use proper diligence to
inform himself as to its quality, and, in the case of real estate, as to its
location. The quality of land on which its value depends, and which is
too various for a market standard, the purchaser can see, if he will but
look. No action lies against the vendor of real estate for false and
fraudulent representations as to the location of lands. Land is not like
a ship at sea; it has a known location and can be approached, and,
even should it be necessary to purchase the land unseen, covenants
may be inserted respecting the quality as well as seisin or title.
Sherwood v. Salmon, 2 Day, 128, 136. He must look to the title papers
under which he buys, and is charged with notice of all the facts
appearing upon their face, or to the knowledge of which anything there
appearing will conduct him. He may not shut his eyes or his ears to
the inlet of information, and then say he is a bona fide purchaser
without notice. Burwell's Adm'rs v. Fauber, Va., 21 Grat. 446, 463.
Whereas the Major Law Lexicon (Fourth Edition), (page 6035-see page
number, ) the ‘rule of caveat emptor’ means that the buyer is bound to
CP.No.1133-L/2016 11
see that, what he buys, he buys after satisfying himself that there is
good title. If a person chooses to buy a property without looking into
title he does so at his own and the law will not help him to get rid of
the bargain. Gour Kishan v. Chunder Kishore, per Gart T CJ, (1876)
25 SUTH WR 45 (46). In the case of Bahar Shah and others Vs
Manzoor Ahmad (2022 SCMR 284), this Court held that an honest
buyer should at least make some inquiries with the persons having
knowledge of the property and also with the neighbors. Whether in a
particular case a person acted with honesty or not will obviously
depend on the facts of each case. The good faith entails righteous
and rational approach with good sense of right and wrong which
excludes the element of deceitfulness, lack of fair-mindedness and
uprightness and or willful negligence. The purchaser is required to
make inquiry as to the nature of possession or title or further
interest if any of original purchaser over the property in question at
time of entering into sale transaction.
12. In the case of Amjad Ikram vs. Mst. Asiya Kausar (2015 SCMR 1),
the court held that in case of inconsistency between the Trial Court
and the Appellate Court, the findings of the latter must be given
preference in the absence of any cogent reason to the contrary as has
been held by this court in the judgments reported, as Madan Gopal
and 4 others v. Maran Bepari and 3 others (PLD 1969 SC 617) &
Muhammad Nawaz through LRs. v. Haji Muhammad Baran Khan
through LRs. and others (2013 SCMR 1300).
13. We did not find any infirmity or perversity in the impugned
judgment warranting our interference, therefore leave to appeal was
declined and the Civil Petition was dismissed by our short order dated
16.01.2023. Above are the reasons of our short order.
Judge
Judge
Judge
ISLAMABAD
16th January, 2023
Khalid
Approved for reporting
