Property law blog post: Actionable claim

INTRODUCTION:

The term actionable claim it is that every kind of claim in a movable property which would
be enforced by the courts. But such a wide meaning created confusions. For example, under
this meaning all debts whether secured (or) unsecured were actionable claims whereas a debt
secured by mortgage of an immovable property is, strictly speaking, an ‘interest in land.
Similarly, under this meaning any claim of money whether the amount was fixed amount or
uncertain amount, was an actionable claim. Because of such confusions there used to be
conflicting decisions and the law was neither clear nor uniform.

As Per Section:-3 of the Transfer of Property Act, 1882 Actionable Claim means any
unsecured debt or beneficial interest in movable property, not in possession, actual or
constructive, of the claimant. It is a claim relating to simple debt for which there will be no
security of movable or immovable property. Debts secured by a mortgage of immovable
property or a pledge or by the movable property are excluded from the definition. These are
now not claim to a property, but of the property itself. All claims under contract are excluded,
except claims to the payment or a liquidated sum of money or debt or price

DEFINATION

According to Section 3, actionable claim means:

(1) Unsecured money debt, and
(2) A claim to beneficial interest in movable property not in possession of the claimant.

( 1)Unsecured Money Debt:

A debt is an obligation to pay a liquidated or definite sum of money. Such debt may me:

(1) Existent,

(2) Conditional,

(3) Contingent.
 If it is now due and owing it is existent. If it is a present debt but payable in the future it is
accruing. A debt which will be due only if a condition be fulfilled or if a certain specified thing
happens is a conditional debt. Contingent debts are debt which are payable on a certain
contingency, e.g., an amount due under a policy of insurance.

Types of Debts

Existent Debt: Where a debt or sum of money1 has already become due and is payable
(enforceable) at present, the debt is existent.

Accruing debt: Where a debt or sum of money is at present due but it is payable not now but on a
future date, the debt is accruing. Accruing debt is due at present but becomes payable only on a
future date

Conditional or Contingent debt: Where the claim for a sum of money exists but the payment
depends upon the fulfilment of any condition, the debt is condition.

(2) Claim to Beneficial Interest, not in a Possession of the Claimant

The right of a person to take possession of movable property from the possession of another is the
actionable claim of that person provided the claimant has a beneficial interest(i.e. right of
possession) in that property.

The following conditions are necessary for an actionable claim:

(a) The claim is in some movable property.

(b) The movable property is in possession of any another person.

(c) The beneficial inter or right of the possession of the claimant is recognized by the court

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According to section 130 which is also about a transfer of actionable claim

 Transfer of an actionable claim is whether with (or) without consideration shall be effected
only by execution of an instrument in writing signed

 By the transfer or by his duly authorized agent, shall be complete & effectual upon the
execution of such instrument

 All the rights and remedies of the transfer, whether by way of damages (or) otherwise,
shall vest in the transferee, whether such notice of the transfer as is here in after provided be given
or not.

 The right to benefit from a contract can also fall within the definition of Actionable Claim.

Examples of “Actionable Claim:-

“The following claims are “actionable claims”:-

1. Claim for arrear rent;

2. Claim for rent to fall due in future.
3. An option offered to repurchase the property once sold.
4. Benefit of a contract giving option to purchase the land.
When a contract for purchase of goods is endorsed by the purchaser, by writing on the back of the
contract under his signature that he has sold all his rights and interest in the goods purchased