You are on page 1of 5

Maharashtra National Law University, Mumbai

Transfer Of Property Act.

Clog on Equity of Redemption

Synopsis

Vidit Harsulkar
2015-021
Semester V
INTRODUCTION

Equity would mean in a layman’s life as fairness. Back during the middle Ages in England, there
were certain grey areas where it was observed that the Common Law was inadequate in its
abilities to deliver justice to the common person1. This led to a directive by the King to appoint
Chancellors in special courts who would go beyond the realm of the law to dole out justice and
fairness to the parties. In Common Law, equity is used as a means to sharpen the meticulousness
of the law in order to achieve justice2. Such courts were called Courts of Equity.

Under a mortgage, two interests are generated by the owner of the property. One is the interest of
the creditor on the property, which is limited and fixed and another, is the residuary interest left
which can be quantified only by deducting the creditor’s interest from the value of the security.
The fundamental bargain from this division of interests is the presence of a right to buy back the
property without any encumbrances by paying the loan. This right is called the equitable right to
redeem. The first instance of the presence of the right of redemption was found in Roman law3. It
has been rightfully said that “Redemption is purely a creature of courts of equity”4.

Section 60 of the Transfer of Property Act, 1882 provides the right of redemption to the
mortgagee. This right becomes alive only after the principal money becomes5. There are certain
limitations to this right by the fact that it exists only till the mortgagee decides to exercise his
right of foreclosure on the property6. Thus, the contract of mortgage between the parties ends,
when the debtor exercises his right to redeem through paying off the loan7.

1
S.N. Shukla, The Transfer of Property Act 219 (23 rd ed., 2001).
2
F.H. Lawson & Bernard Rudden, The Law of Property 15 (Peter Birks ed., 3 rd ed., 2002).
3
2 Leonard A. Jones, A Treatise on the Law of Mortgages of Real Property 1 (The Riverside Press, Cambridge
1894).
4
Posten v. Miller, 19 N.W. 540.
5
Sarojini Prabhu v. Papikutty Adiesian, AIR 2007 Ker 44.
6
Poonam Pradhan Saxena, Property Law 344 (2 nd ed., 2011).
7
Parmeswaran Govindan v. Krishnan Bhaskaran, AIR 1992 SC 1135.
This right provided by the Transfer of Property Act is a statutory right which can only be done
away by compliance to the procedure established by law8. It would henceforth follow that any
obstruction to this right would be declared as void as a clog on the equity of redemption.

CHAPTERIZATION

1. INTRODUCTION
2. CLOG ON REDEMPTION
2.1. LEADING CASES
3. LONG TERM MORTGAGES
4. CONDITIONS OF SALE OF PROPERTY
4.1. PENALTY IN CASE OF DEFAULT
5. COLLATERAL BENEFIT TO MORTGAGOR
6. SUBSEQUENT AGREEMENT TO POSTPONE REDEMPTION
7. CONCLUSION

RESEARCH QUESTION

1. Does any obstruction to rights provided by the Transfer of Property Act would be
declared as void as a clog on the equity of redemption

8
Mulla, The Transfer of Property Act, 1882 656 (Solil Paul ed., 9 th edition, 2000).
LITERATURE REVIEW:
Articles:
1. Balavar, E. The Doctrine of Nemo Dat Quod Non Habet and its exceptions. Textroad
Publications, 2014.
The article provides an insight of the present day regulations governing a non owner’s
transfer of property and how they protect a bona fide purchaser who acquires goods from
a lawful possessor in the civil law jurisprudence. It basically highlights the practicality of
the concept of Nemo Dat Quod Non Habet and its exceptions.

2. Kozolchyk, B. Transfer of Personal Property by a Non Owner: Its Future and its Past.
Tulane Law Review, 1987.
It basically highlights the provisions of the Malaysian Sales of Goods Act (1957) and the
UK Sale of Goods Act (1979). It discusses the various cases laws associated with such
jurisprudence and the reasoning and rationale that is followed in carving out exception to
the rule of Nemo Dat Quod Non Habet. It will help the researcher in getting a conceptual
clarity of the concepts associated with the transfer of a property by a non owner.

Books:
1. Mulla DF, Transfer of Property Act (Saxena PP ed. 11 ed, Lexis Nexis 2013)
th

2. R.K Bangia, Contract – II, (6 Edition, Allahabad Law Agency, 2009)


th

3. Sarathi VP, Transfer of Property, (5 Ed, Eastern Book Co 2005)


th

4. Saxena PP, Property Law, (LexisNexis 2011)


5. Tripathi GP, The Transfer of Property Act, (Central Law Publication, 2008)
All the books contain a general chapter on transfer of property by a non owner or a chapter on
sec 27 of the sales and good act. The researcher will be taking arguments, critical concepts and
case laws from all of them.

You might also like