TRANSFER OF PROPERTY ACT,1882 – Indian Kanoon

TRANSFER OF PROPERTY ACT,1882 - Indian Kanoon

TRANSFER OF PROPERTY ACT,1882

TOPIC-DOCTRINE OF PART PERFORMANCE-

 

INTRODUCTION-

Section 53A of the transfer of property act deals with the doctrine of part performance. The Doctrine of Part Performance had originated in England and was subsequently added to the transfer of property Act, 1882 via the Amendment Act of 1929. The doctrine is based on the principle of Equity.

EXPLANATION OF S.53A-

S.53A basically says that if suppose ‘A’ enters into a contract with ‘B’ and allows b to act according to or on behalf of the contract, then in such a case he, means ‘A’ creates an equity himself that cannot be resisted on the grounds that there was any absence of formality in the evidence or contract of such a transfer.

The general rule in law is that a contract of an immovable property valued over Rs.100 has to be registered under the Indian Registration Act but doctrine of part performance is an exception to this rule. This rule is relaxed in the case of doctrine of part performance as it is believed that strict compliance could lead to extreme hardship especially when the other party to the contract has already acted its part on the belief that the other party will honour the agreement.

Therefore, even if the contract has not been registered the transferor cannot still go against the transferee and can cause him no harm. However, its a must requirement that the deed must be signed and stamped.

MAIN CHARACTERSTICS OF DOCTRINE OF PART PERFORMANCE-

  1. The contract entered into on behalf of the transferor and the transferee must be in respect of an immovable property.
  2. The contract must be a written contract.
  3. In case of a void agreement or no agreement the doctrine does not apply.
  4. There must be some consideration.
  5. The contract must state the terms of the transfer with reasonable certainty.
  6. The transferee must have taken the possession of the property as a result of the contract or continued in possession if he was already in the possession.
  7. The transferee must have done some act in furtherance of the contract.
  8. Acts done prior to the agreement cannot be deemed to be the part performance of the contract.
  9. The transferee must have performed his part of the contract or must be willing to perform it.

 

ILLUSTRATION-

 

Ram  induces Hari to purchase his property. hari enters into the contact of sale of the property with Ram and pays Ram an advance of Rs.5 lakhs and takes the possession of the property. After some months hari  is ready to pay the remaining amount to Ram but Ram refuses to accept the amount and asks hari to give back the plot to him.

 

Here Hari  is ready to play his part of the contract but now Ram is not.

 

In such a case Hari  can file a suit against a of Specific Performance from Ram.

 

CASE LAW-

 

SULLIVAN V. PORTER, 861 A.2d 625 (2004)

 

Facts of the Case-

 

Porter offered  to sell his property to Sulivan and Andrews for $350,000 with a $20,000 down payment and  Sullivan accepted orally. Porter said that he would have his attorney prepare his paperwork. Sullivan took the possession of the property in September 200 and began to improve the stable and trails. This continued til November 24, 2000 till porter arrived at the farm with a Real Estate Agent. Porter told Sullivan that another buyer was interested but told Sullivan that he would honour their agreement.

 

The next day Porter accepted a $3000 down payment  from Sullivan. Sullivan and Andrews began improvements on the property, started their new buissness, began advertisements in the local newspapers and paid for an appraisal of the property. Poter regularly visited the property and received updates about the renovations but did not produce the paperwork necessary to complete the transaction. Porter then offered to sell the property for $450,000 with a $50,000 down payment.

 

Sullivan filed a suit for the breach of contract, promissory estoppels, and Specific Performance and Porter asserted the statute of frauds. Porter appealed  the court’s judgement and award of specific performance in the favour of Sullivan.

 

ISSUE OF THE CASE-

What must a party show in order to invoke the doctrine of part performance?

 

HOLDING AND RULE-

To invoke the doctrine of part performance the party must clearly prove-

  1. That the parties did not enter into a contract.
  2. That the party seeking to enforce the contract partially performed the contract.
  3. That the performance was induced by other party’s misrepresentation , which may include acquiescence or silence.

 

The Court held that the agreement encompassed the essential material terms for a contract to sell the farm. They identified the property, determined a purchase price, a down payment and the type of financing. Such conduct involves misrepresentations including misleading statements, conduct or silence that include detrimental reliance.

 

REMEDY- Specific Performance.

 

TRANSFER OF PROPERTY ACT,1882 – Indian Kanoon

 

 

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  • ujjwal

    Nice xpnation thanks

  • Kakuli

    Good notes