' By this judgment Suit No, 1/72 and Suit No, 606/77 will be disposed of. Suit No, 1/72 has been filed for declaration, cancellation of Deed of Conveyance and redemption of mortgage. Briefly the facts are that plaintiffs Nos. 1 and 2 are joint owners of the plot and building bearing No, 421/3 Garden East.
The plaintiff No, I is the brother of plaintiff No, 3, plaintiff NO. 2 is the brother-in-law of plaintiff No, 1.
The plain- tiffs I and 2 had appointed plaintiff No, 3 as their attorney. The plaintiff No, 3 was in need of funds and he approached the defendant No, 1 who promised to advance Rs, 30,000 subject to execution of irrevocable general power of attorney, promissory note for Rs, 14,400 and deposit of all documents. The plaintiff No, 3 being in need of money executed all the documents that were prepared by the defendant No, 1 and Rs, thirty thousand were paid to him. However, it is alleged that Rs, 14,400 were not paid. The plaintiffs have stated that plaintiff No, 3 repaid Rs, 10,200 to the defendant No, 1 for which no receipt was issued by him. The plaintiff No, 3 after disposing of his business went to the defendant No, 1 several times and offered Rs, 16,800 towards the payment of the loan but, the defendant No, 1 avoided to accept it and ultimately a legal notice dated 5th November, 1971 was served. The plaintiff No, 3 for the first time by a notice sent to him came to know that the defendant No, 1 had sold the property by a registered sale dated 4th May, 1971 of defendant No,
3. The plaintiffs have pleaded that in the transaction of loan advanced by defendant No, 1 to plaintiff No, 3 title documents of property bearing No, 421/3 Garden East were deposited by way of security. The deposit of title deeds was in the nature of equitable mortgage and the defendant No, 1 did not have a right to sell the property. The plaintiffs have further pleaded that the plaintiffs Nos. 1 and 2 had appointed plaintiff No, 3 as their attorney but power of delegation was not conferred upon him and, therefore the defendant No, 1 did not have any authority to sell the property. It has been pleaded that the defendants Nos.. I and 2 in collusion have got the sale-deed registered on 4th May, 1971 for Rs, 50,000 which is void. The plaintiff has further claimed redemption of the equitable mortgage against payment of Rs, 19,800 or any amount found due and for declaration that the conveyance deed dated 4th May, 1971 in favour of defendant No, 2 is void and without authority. The defendants. Have filed written statement separately. The defendant No, 1 has taken the plea that the plaintiff No, 3 had absolute authority to dispose of the property in suit by virtue of General Power of Attorney executed by plaintiffs Nos. I and 2. The plaintiff No, 3 had approached defendants No, 1 for friendly loan of Rs, 44,400 which was ' advanced to him. Rs, 30,000 were advanced against the Mortgage-deed dated 27th November, 1978, receipt dated 27th November, 1969 and the general power of attorney executed on 27th November, 1969. Rs, 14,400 were advanced by way of loan under an agreement dated 27th November, 1969 and also a receipt of the same date. Additionally a pronote was also executed for the same amount by way of collateral security. In this way Rs, 44,400 was advanced as a friendly loan. It has been stated that the plaintiff No, 3 did not pay a single penny towards his debt. It has been pleaded that the property in suit having been sold by defendant No, 1 to defendant No, 2 all claims and notices have no legal sanctity. It has been averred that the defendant No, 1 called upon plaintiff No, 3 by notice dated 16th January, 1971 to pay all the debts failing which he was warned that he would proceed with the sale of the property on the basis of the irrevocable general power of attorney in his favour executed by plaintiff No, 3 but in vain. As the plaintiff No, 3 did not discharge his obligation he was notified through Press and ultimately the property was sold to the defendant No,
2. It has been denied that the plaintiffs are entitled to cancellation of the sale-deed or the redemption of the property. The defendant No, 2 has pleaded that the plaintiffs Nos. 1 and 2 have ceased to be the owners of the property in suit and cannot file the suit. He has likewise pleaded that the defendant No, 1 by virtue of irrevocable power of attorney executed by plaintiff No, 3 had the authority to sell it.
In addition to this the plaintiff No,
3. Had executed the mortgage-deed in favour of the defendant No, 1 on 27th November, 1969 and on the basis of these documents the defendant No, 1 was fully competent to sell the property in suit and, therefore, sale in his favour was valid. It is stated that the plaintiff No, 3 had full knowledge of the sale as it was published in the newspaper. On these grounds the prayer is opposed.
' On these facts Muhammad Saghir the defendant No, 2 in Suit No, 1/72 has filed Suit No, 606/77 against Qurban Ali, Ali Muhammad, Muhammad Ali and Gulfam for possession and mesne profits.
On the basis of the pleadings the following issues were framed :- ' Issues in Suit No, I/72:
(1) Whether the suit is barred under section 115 of the Evidence Act, 1872 ?
(2) Whether the plaintiff No, 3 secured, a loan of Rs, 44,000 or of Rs, 30,000 from the defendant NO. 1 ?
(3) Whether the pronote of Rs, 14,400 is devoid of consideration ?
(4) Whether the plaintiff No, 3 out of the loan received, paid Rs: 10,200 to the defendant No, 1 as alleged?
(5) Whether or not the plaintiff No, 3 by virtue of the execution of General Power of Attorney by the Plaintiffs Nos. 1 and 2 in his favour had the authority to sell the property in suit and whether the plaintiff No, 3 was competent to delegate the power to sell, mortgage or/and pledge, if so what is its effect ?
(6) Whether or not the defendant No, 1 as a result of failure on the part of the plaintiff No, 3 to repay the loan, was competent to sell without intervention of Court the property in suit by virtue of the execution of (1) Mortgage-Deed dated 7th November, 1969 ; (2) Loan Agreement dated 27th November, 1969 and (3) Irrevocable General Power of Attorney dated 27th November, 1969 by the plaintiff No, 3 if so whether the defendant No, 1 was competent to appropriate the sale-proceeds to his own account ?
(7) Whether the sale-deed in respect of the property in suit executed on 4th May, 1971 by the defendant No, 1 in favour of the defendant No, 2 is fake, without consideration, collusive and void.
(8) Whether the plaintiff No, 3 has any authority to file the present suit on behalf of the plaintiffs 1 and 2 and sign pleadings on their behalf ?
(9) To what relief,/reliefs are the plaintiffs entitled ? Issues in Suit No, 606177 :
(1) Whether the defendant No, 1, by virtue 6f the power of attorney dated 14th October, 1963, was competent to appoint the defendant No, 4 as his agent/attorney, delegating all the powers which he himself was authorised to exercise thereunder ?
(2) Whether the defendant No, 1 executed a general power of attorney on 29th November, 1969 in favour of the defendant No, 4 in his personal capacity and by way of security for the amount advanced ?
(3) Whether the defendant No, 4 by virtue of the irrevocable general power of attorney dated 29th November, 1969, was competent to transfer/sell the property in suit to the plaintiff ?
(4) Whether the sale of the property in suit by the defendant No, 4 to the plaintiff by executing a registered sale-deed on 4th May, 1971 is fake and fictitious ?
(5) Whether the defendant No, 1, at the time of the transfer of the property in suit, delivered possession of a considerable portion thereof to the plaintiff ? If so, what is its effect ?
(6) Whether the suit is under-valued, as alleged ? If so, what is its effect ?
(7) To what relief or reliefs is the plaintiff entitled ? I will first deal with Issues in ' Suit No, 1/72.
' Issue No, 1.-Plaintiff No,
3. Is admittedly an attorney of plaintiffs Nos. 1 and 2. The power of attorney Exh. 9/1 authorised the plaintiff No, 3 to mortgage and sell the property. To secure the loan of Rs, 30,000 the plaintiff No, 3 had executed the agreement of mortgage by deposit of title deeds and a receipt. The receipt and the mortgage-deed were executed as attorney for and on behalf of defendants Nos. 1 and 2. The irrevocable general power of attorney Exh. D/13 was executed by the plaintiff No, 3 in favour of defendant No,
1. The learned counsel for the defendant Mr. S. Sami Ahmad has contended that having executed all these documents the plaintiff No, 3 cannot resile and say that they are not binding upon him. On the other hand the learned counsel for the plaintiffs has contended that the power of attorney authorised the plaintiff No, 3 to execute the mortgage and sale-deed only for the benefit of the plaintiffs Nos. 1 and 2 and for the Management of the property.
The plaintiff No, 3 was not authorised to mortgage the property or sell it for his own benefit. The plaintiffs are not denying the existence of power of attorney. The plaintiffs Nos. 1 and 2 are disputing that the plaintiff No, 3 could not mortgage the property for his own benefit or delegate his power to defendant No,
2. In order to attract the provision of section 115 of the Evidence Act and apply the principle of estoppel it is necessary that it may be established that a representation was made to the other side and on the basis of that representation the other party has altered his position. In these circumstances an estoppel will be created against the person making the representation. In the present case the question of making representation does not arise. From the evidence it is clear that the plaintiff No, 3 was seeking a loan as he was in difficulties. The defendant No, 1 asked for the title documents. All such documents as demanded by the defendant No, 1 were delivered to him who instructed his Advocate to prepare necessary security documents to protect his interest.
In these circumstances it is difficult to believe that any representation of any nature was made by the plaintiffs on the basis of which the defendant No, 1 has acted and altered his position. The learned counsel for the defendants has relied on AIR 1935 PC 208,1 LD 1971 SC 376 and 1980 SCM R
765. All these three cases are distinguishable on facts because in every case either there was some representation or an acknowledgement made by the party and, therefore, it was held that the principle of estoppel will apply.
' Mr. S. Sami Ahmad has contended that plaintiffs Nos. 1 and 2 are estopped because (1) they had executed general power of attorney, (2) both the documents under which money was received were executed for and on behalf of plaintiffs Nos. 1 and 2 and (3) as they have joined hands with plaintiff No, 3 it should be presumed that their interest is common. The execution of general power of attorney in favour of plaintiff No, 3 does not amount to a circumstance which may create an estoppel because the plaintiffs 1 and 2 are not denying the execution of the power of attorney in favour of defendant No,
3. The fact that the receipt and the documents. Relating to Rs, 30,000 were executed by the plaintiff No, 3 as attorney of plaintiffs Nos. 1 and 2 is also nullified by the fact that in the pleadings as well as in the evidence the defendant No, 1 has clearly stated the loan was advanced to plaintiff NO.
3. The defendant No, I did not state that the loan was advanced to the plaintiffs 1 and 2. In these circumstances, mere execution of documents on behalf of plaintiffs Nos. 1 and 2 will not bind the plaintiffs Nos. 1 and 2 to create an estoppel.
' Issue No, 2.-From the evidence of the parties it is established that Rs, 30,000 were advanced to the plaintiff No,
3. The dispute is only in respect of Rs, 14,400. The defendant No, 1 in his evidence has admitted that both the amounts were advanced at the same time. The loan transaction was the same but it was bifurcated in two parts ; first was for Rs, 30,000 and the other was for Rs, 14,400. In respect of loan of Rs, 30,000 the defendant No, 1 obtained mortgage deed, receipt and a general power of attorney. But for Rs, 14,460 he obtained only an agree ment, a receipt for Rs, 14,400 and a promissory note for Rs, 14,400. All these documents were prepared at the instructions of the defendant No, 1, through his own Advocate. No explanation has been given by defendant No, 1 why the transaction of loan was bifurcated in two parts. The normal course of dealing between a borrower and a creditor is that the creditor wants to have full security of the entire loan that may be advanced. If the entire loan amounted to Rs, 44,400 then in the normal course the defendant No, 1 should have obtained mortgage document for the entire amount instead of restricting it, to Rs, 30,000 only. Security by mortgage is always considered a better security than mere execution of a pronote. It, therefore, seems that the main transaction was for securing the loan of Rs, 30,000. The plaintiff No, 3 has stated that the defendant No, 2 got second set of documents executed for Rs, 14,400 which was not paid and was only to represent the amount of interest which was to accrue on Rs, 30,000. This amount, the defendant No, 1 did not want to show in the mortgage 'deed and, therefore, separate set of documents were prepared. The explanation offered by the plaintiff No, 3 seems to be reasonable. In the absence of any valid reason for executing two sets of documents at the same time in respect of the same transaction, the explanation offered by the plaintiff No, 3 sounds to be reasonable. The defendant No, 1 has not produced any evidence of payment of Rs, 14,400 except the agreement, receipt and the pronote. No doubt a presumption is attached to a pronote that it is with consideration but it is rebuttable and if there are circumstances and evidence to that effect which are sufficient to rebut the pre- gumption, the burden shifts on other party to show that the pronote is with consideration. In the evidence the plaintiff No, 3 has stated that these documents were executed in the presence of Ghafoor and Sadiq Advocates and Sharfuddin was also present there. The defendant No, 1 has not denied these allegations in the evidence but failed to produce these two witnesses. Ghafoor and Sadiq Advocates may have been the proper persons to give evidence as the entire transaction had been carried out and documentation was made by them. In the absence of this evidence presumption has to be drawn against the defendant No, 1. 1, therefore, hold that the loan was for Rs, 30,000 and that the promissory note for Rs, 14,400 was without consideration.
' Issue No, 4.-The plaintiff No, 3 has stated that he had paid Rs, 10.200 to defendant No, 1 but no receipt was obtained from him. He has produced P. W. 2 but his statement does not support his contention as he does not admit that the payment to defendant No, 1 was made in his presence.
The plaintiff No, 3 did not even serve a notice on the defendant No, 1 regarding payment of this amount. In these circumstances the plaintiff has failed to prove payment of Rs, 10,200. My finding is in the negative.
' Issue No, 5.-This issue can be divided in two 'parts. Firstly, whether the plaintiff No, 3 was competent to sell the property and secondly, whether the plaintiff No, 3 could delegate his power to sell and mortgage . The property in suit. Plaintiffs Nos. 1 and 2 have contended that under the general power of attorney executed by plaintiffs Nos. I and 2 in favour of plaintiff No, 3, the plaintiff No, 3 had the authority to mortgage and sell the property in suit but he was not competent to delegate the power to sell or mortgage. This issue entirely depends upon the construction and interpretation of the power of attorney executed in favour of plaintiff No, 3, Mr. S. Sami Ahmad the learned counsel for the defendants has referred to paras. 1 and 5 of the power of attorney and has contended that from these provisions coupled with the fact that there was an absolute power to sell and mortgage the suit property it can be inferred that the plaintiff No, 3 had an implied power to delegate this authority. The arguments admits that there was no specific power to delegate the power. For better understanding of the contention of the learned counsel for the defendants, relevant portions of the power of . Attorney are reproduced as under : - "By this power of attorney given the,_14th day of October, 1963, we Ali Muhammad, son of Kara and Muhammad All, son of Jamali both Khoja Muslims, adults, Merchants of Kampala, Uganda being entitled as joint owners to the property described in the schedule hereto hereby appoint Qurban All Kara Proprietor of Kurban Provision Store, Saddar, Karachi, West Pakistan (hereinafter called the Attorney) to be our true and lawful attorney to manage the said property on our behalf and to sell, mortgage, exchange and convey the said property and we hereby confer upon the attorney the followings powers and authorities :
(1) For us and in our name or otherwise to receive every sum of money whatsoever which now is due arising or belonging to us upon or by virtue of any mortgage, charge or other security whatsoever and on receipt thereof to make, sign, execute and give good and sufficient releases, acquaintances or other discharges for the same and also to sign, seal, execute, make and deliver all proper and sufficient conveyances, releases and other assurances of the lands, tenements and property which shall have been mortgaged as security therefor and also to consent to any such alteration or modification of the nature or conditions of the said securities or any of them as the attorney shall think fit...
(2) To sell (either by public auction or privately) or exchange any part of our property for such consideration and subject to such covenants as he may think fit and to give receipts for all or any part of the purchase or other consideration, money and the same or any of them with like powers to mortgage, charge or pledge and also to deal with our real or personal property or any part thereof as he may think fit for the purpose of paying off, reducing, consolidating or making substitution for any existing or further mortgage, charge or pledge thereon or thereof or any part thereof and to make or concur in any transfer of or alteration in the terms of any existing or future mortgage, charge or pledge of the same or any part thereof as he shall think fit and in general to sanction any scheme for dealing with mortgage, charges or pledges of our real property or any part thereof as fully and effectually as we ourselves could have done.
It is a well-settled principle, that the power of attorney has to be construed strictly. Reference can be made to PLD 1969 Kar.
123. A. Plain reading of the power of attorney particularly the clauses referred by the learned counsel for the defendants do not give the impression that it can be construed to authorise the plaintiff No, 3 to delegate his power. The attorney is always a delegate of the authority conferred on him. It is a well-recognised principle that a delegatee cannot delegate such powers unless he has been specifically authorised to delegate it. In this regard reference has been made to Halsbury's Laws of England 4th Edition, Volume 1, page 448. Mr. Shaikh Haider the learned counsel for the plaintiff has referred to Bowstead on Agency, 14th Edition, page 101, Article 35 which reads as follow :
(1) An agent may not delegate his authority, or appoint a sub-agent to do any act on behalf of his principal, except with the express or implied authority of the principal.
(2) The authority of the principal is implied in the following cases :
(a) Where the act done is purely ministerial and does not involve confidence or discretion.
(b) Where the principal knows, at the time of the agent's appointment that the agent intends to delegate his authority.
(c)Where, from the conduct of principal and agent, it may reasonably be presumed to have been their intention that the agent should have power to delegate his authority.
(d) Where the authority conferred is of such a nature as to necessitate its execution wholly or in part by means of a deputy or subagent.
(e)Where the employment of a sub-agent is justified by the usage of the particular trade or business in which the agent is employed, provided that such usage is not unreasonable, and not inconsistent with the express terms of the agent's authority.
(f) Where in the course of the agent's employment unforeseen circumstances arises which render it necessary for the agent to delegate his authority.
' The above principle is based on Maxim delegatus non potest delegate. An agent cannot delegate his authority unless he has been specifically authorised to do so. But in special circumstances a sub-agent may be appointed, provided by ordinary custom of trade or from the nature of agency a sub-agent must be employed. The present case does not fall in any of the categories mentioned above. Where a sub-agent is appointed by an agent without any authority of the principal the subagent is the agent of the agent and the principal has nothing to do with him. The principal can be bound down by the acts of a sub-agent only when he has been validly appointed. In order to delegate his power there should be a specific authority to an agent by the principal. If in the absence of any authority to delegate the power; the agent does any act to that effect, it cannot be a valid act binding upon the principal. But such acts can be legalised by rectification by the principal. In the present case, I find that there is no rectification by this principal.
' Under section 190 of the Contract Act the principles of delegation of the authority by an agent have been propounded. It provides that an agent cannot lawfully employ another to perform acts which he has expressly or impliedly taken to perform personally. It is permissible only where the ordinary custom of trade or from the nature of the agency it may be delegated. The defendants, therefore, in order to prove that the delegation was proper should bring their case within the ambit of this section. The duty conferred upon the plaintiff No, 3 was to manage the property, to mortgage or sell it and, therefore, in these circumstances it is clear that the plaintiffs Nos. 1 and 2 had entirely relied upon the discretion, experience, honesty and integrity of plaintiff No,
3. They had cast a duty upon the plaintiff No, 3 to perform this duty personally and in the absence of any authority to delegate such powers, the plaintiff No, 3 had no authority to do so. In this regard reference may also be made to section 193 of the Contract Act that if any person is appointed as a subagent without any lawful authority then the principal is not represented by or responsible for the acts of the person so employed. Therefore, any act done by such an unauthorised sub-agent cannot bind the principal.
' The learned counsel for the defendants has contended that as the plaintiff No, 3 had an authority to sell and mortgage the property and in pursuance thereof he has entered into mortgage for and on behalf of the plaintiffs Nos. 1 and 2 and obtained Rs, 30,000 on their behalf and as he has executed a power of attorney in favour of the defendant No, 1 it will amount to a sale of the property and, therefore, the act is authorised and cannot be objected to by the plaintiffs. The mortgage and the receipt for Rs, 30,000 no doubt stated that it was received on behalf of plaintiffs Nos. 1 and 2 but in order to find out the real intention of the parties it would be necessary to look into the pleadings, documents and evidence of the parties. In suit No, 1/72 the defendant No, 1 has admitted in his written statement that the plaintiff No, 3 approached the defendant No, 1 for friendly loan in the sum of Rs, 44,400 which was advanced to him for which two documents of Rs, 30,000 and Rs, 14,400 were executed. From the evidence it is clear that all documents were prepared by the Advocate of the defendant No, 1 which included the general power of attorney executed by the plaintiff No, 3 in favour of defendant No,
1. By this document plaintiff No 3 has appointed defendant No, 1 as his attorney. It also recites that the plaintiff No, 1 has taken the loan of Rs, 30,000 from the defendant No, I and to safeguard the interest of defendant No, 1 the plaintiff No, 3 was to constitute him as his general attorney till full and final repayment of the aforestated loan. For better understanding the contention of the parties, the recitals of the power of attorney executed by plaintiff No, 3 in favour of defendant No, 1 are reproduced hereunder :- ' WHEREAS I, Qurban Ali son of Kara, Proprietor of Qurban Provision Store, Frere Street, Saddar, Karachi, have received a friendly loan of Rs, 30,000 (Rupees thirty thousand only) from Mr. Gulfam son of Sharfuddin, residing at Wood Market Street, Saddar Karachi ; ' AND WHEREAS I deem it necessary in order to safeguard the interests of the said Mr. Gulfam, that I shall constitute him as my General Attorney till the full and final repayment of the aforesaid loan.
' NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS that I, Qurbanali son of Kara Proprietor, Qurban Provision Store, Frere Street, Sadar, Karachi do hereby appoint, constitute and ordain Mr. Gulfam son of Sharifuddin, of Wood Market Street, Saddar, Karachi as my General Irrevocable Attorney to do all or any of the following acts, things and deeds in my name and on behalf of in respect of my all movable and immovable properties viz. Shop and stock of Trade lying therein being run as Qurban Provision Store, Frere Street, Saddar, Karachi, and Plot No, 421/3 Survey Sheet No, G. E.
Garden East, admeasuring 755 square yards, with building thereon, hereinafter referred to as the "Said Property" Police Station Garden.
' The defendant No, 1 in his evidence stated that plaintiff No, 3 came to him and requested a loan for Rs, 44,400. He has stated that the plaintiff No, 3 had promised to repay the loan within a period of six months, and that after preparation of documents and payment of Rs, 44,400 to the plaintiff No, 3, he executed the documents. He further stated that plaintiff No, 3 failed to repay the amount after the expiry of six months and on his failure to pay he sold the property to defendant No,
2. This clearly shows that at all material times when the transaction for loan was being negotiated and settled the loan was being advanced to plaintiff No, 3 and it had no concern with plaintiffs Nos. 1 and 2. It, therefore, seems clear that the execution of receipt and the mortgage-deed purported to be on behalf of plaintiffs Nos. 1 and 2 was got prepared by the defendant No, 1 mainly to protect his interest and to create a proper security for repayment of the loan. The entire power of attorney gives the impression that it was executed by the plaintiff No, 3 in his personal capacity in respect of his own property. Even the property in dispute has been alleged to be his own property. Pertinently enough, nowhere reference has been made to plaintiffs Nos. 1 and 2, in respects of loan, its repayment and the authority conferred on the defendant No, 1 by virtue of the power of attorney.
From the evidence on record the irresistible conclusion is that the plaintiff No, 3 had obtained a loan for his personal need and had appointed defendant No, 3 as his attorney and not the attorney of plaintiffs Nos. 1 and 2. In these circumstances, it is to be considered whether it can be inferred that there was any implied authority in the plaintiff No, 3.
An implied authority to delegate can be inferred only in such cases wherefrom the usage, custom of the trade and business it is necessary to employ a sub-agent or the exigencies or emergencies require such appointment. The defendants have not proved any custom or usage of the trade or any exigency justifying such a delegation and, therefore, no inference can be drawn that there was an implied authority in the plaintiff No, 3 to delegate 'the power. Where an agent is appointed particularly to manage properties with power to sell and mortgage, it reflects the confidence and trust of the principal which he reposes in the personal qualities of the agent. It, therefore, follows that unless specifically provided such powers cannot be delegated by the agent. In view of this discussion my finding of this issue is that the plaintiff No, 3 was not competent to delegate the power to sell, mortgage or pledge th property of plaintiffs Nos. 1 and 2.
' Issue No, 6.-The defendant No, 1 has by virtue of mortgage deed, loan agreement and the general power of attorney sold the property to the defendant No,
2. The main - contention of the defendants is that as the defendant No, 1 had advanced loan to the plaintiffs who had executed mortgage agreement and also given a power of attorney authorising defendant No, 1 to sell it the defendant No, 1 was competent to sell the property and appropriate the sale proceeds to the satisfaction of his claim. So far the defendant's authority to sell the property by virtue of power of attorney is concerned the matter has thoroughly been discussed in issue No,
5. And I need not dilate further upon it. Now coming to two documents, namely, the mortgage deed and the loan agreement suffice to say that by virtue of mortgage-deed and the loan agreement the defendant No, 1 was not competent to 'sell the property privately. It could have been done only with the intervention of the Court, ' From the mortgage-deed it is clear that the plaintiff No, 3 and the defendant No, 1 had intended to create mortgage by deposit of title deeds. The mortgage-deed dated 247th November, 1969 specifically provides that plaintiff No, 5 as attorney of plaintiffs Nos. 1 and 2 has deposited with defendant No, 1 the documents mentioned in schedule with intent to create a mortgage by deposit of title deeds of all properties comprised therein for securing repayment by the said plaintiffs Nos. 1 'and 2 to defendant No, 1 on 26th November, 1970 all the sum of Rs, 30,000 which has been' advanced. Both the parties agree that a mortgage by deposit of title deed was created. A mortgagee under a mortgage by deposit of title deed has no authority to privately sell the property for the satisfaction of the loan. Under Transfer of Property Act the mortgagor has been given a right to redeem the mortgage. Section 50 of the Act confers on the mortgagor a right of redemption after the date fixed for payment. Such right of the mortgagee is also known as the equity of redemption. This right subsists so long as the mortgage subsists itself. Section 60 clearly provides that at any time after the principal money has become due mortgagor has a right to redeem the mortgage provided the right has not been extinguished by the act of party or by the decree of the Court. Any clog on the equity of redemption is void and illegal. Any condition imposed in the deed of mortgage which places any restriction on the right to redeem the mortgage is a clog on the equity of redemption and is repugnant to law. Mr. Shaikh Haider the learned counsel for the plaintiffs has contended that the execution of the general power of attorney amounted to a clog on the right of redemption and, therefore. It was illgal. It is correct that the loan was advanced on the security of mortgage of property and as admitted by the defendant No, 1 the power of attorney was also executed only to secure the said loan. Therefore, the power of attorney was intended to vest defendant No, 1 with power independent of the mortgage-deed to sell the property in satisfaction of the loan. Where it is established that loan has been advanced and a mortgage- deed has been executed as a security, any document executed separately which vests the mortgagee with a right to sell the mortgaged property without giving the mortgagor option to redeem the property, will amount to a clog on equity of redemption. Mr. Shaikh Haider the learned counsel has referred to AIR 1934 P C 205. Further reference has been made to Order XXXIV, rules 4, 5, 14 and 15, C. P. C. From which it can be inferred that these provisions are applicable to equitable mortgage and the sale can be effected only with the intervention of the Court. Therefore, on this ground also the defendant No, 1 could not have sold the property in exercise of the power of attorney which is alleged to have been executed in pursuance of the mortgage-deed. The second document is the loan agreement but it is only in respect of Rs, 14,400 and is between the plaintiff No, 3 and defendant No,
1. This document cannot confer any right on the defendant No, 1 to sell the property, of plaintiffs Nos. 1 and 2. My finding on this issue is in the negative. Issue No, 7.-The defendant No, 1 has sold the property to defendant No,
2. The defendant No, 2 has admitted that he had taken all the, title documents which were given by defendant No, 1 to him and in turn he had given it to M/s. Sadiq and Ghafoor Advocates who had been advising defendant No, I also. It is, therefore, clear that the defendant No, 2 was aware of all the facts and circumstances of the case and knowing full well he agreed to purchase the property. It is not the case of the defendant No, 2 that he had purchased the property bona fide without knowledge of the disputes between the plaintiffs and the defendant No, 1 or the defects that may have been in the previous transaction. As I have held earlier that the defendant No, 1 had no authority to sell the property the sale effected 'by him in favour of defendant No, 2 is therefore void. Issue No, 8. -The learned counsel for the defendants has contended that the suit was filed by 14aintiff No, 3 and the plaint has been signed by plaintiff No, 3 on behalf of plaintiffs Nos. 1 and 2 and for himself. It attorney did not have any clause authorising the plaintiff No, 3 to file the suit or sign the plaint on their behalf. In these circumstances the learned counsel for the defendant has contended that the plaint was not properly filed and presented and is, therefore, liable to be dismissed. Mr. Shaikh Haider the learned counsel for the plaintiffs has admitted that to begin with the plaintiff No, 3 did not have any authority under the power of attorney to file the suit but he has contended that this act of the plaintiff No, 3 was within the knowledge of plaintiff's Nos. 1 and 2 and was ratified by them by a subsequent document. This power of attorney is dated 26th March, 1980 in which specific power for institution and defending the suits has been given and further the acts done by the plaintiff No, 3 have been ratified. Section 197 of the Contract Act provides that where acts are done by one person on behalf of another but without his authority or knowledge he may elect to ratify or disown it. In case where the act is ratified, the effect will be as if it had been performed by his authority. In case where ratification is required it is necessary to show that an agent was not acting for himself but the act was done for and on behalf of such principal. The ratification presupposes that the act performed by the agent was not authorised by him at the material time. It may also be noted that only such acts can be ratified which are not forbidden by the principal or by law. In the present case, the only objection is that the plaint had not been signed by the plaintiffs Nos. I and 2 but it was signed by plaintiff No, 3 who did not have the authority to do so. The Courts have allowed an unsigned plaint to be signed by the plaintiff even at the appellate stage. The omission to sign the plaint or that it is signed by an unauthorised person is merely an irregularity which can be cured during the proceedings. It is not an illegality which may render the entire proceedings as illegal and void. If such irregularity is cured before the suit is finally decided then in the absence of any other material defect the plaint cannot be rejected on this ground. In the present case the plaintiff's Nos. 1 and 2 have ratified the act of the plaintiff No, 3 specifically by a deed. The effect is that the act performed by the plaintiff No, 3 has been validated from the date of its performance. My findings on this issue is in the negative. Issue No, 9. -In the result the plaintiffs are entitled to prayer made in the suit on payment Rs, 30,000 to the defendant No,
1. The plaintiffs have deposited as Security Defence Saving Certificate for Rs, 30,000. The plaintiffs should deposit Rs, 30,000 in Court within two weeks for payment to the defendant No, 1 failing which the Nazir should encash the Defence Saving Certificate and out of the proceeds the defendant No, I shall be entitled to withdraw Rs, 30,000. On deposit of Rs, 30.000 by the plaintiffs or encashment of the Defence Saving Certificate whichever is earlier the title-deed of plot and building No, 421/3, Garden East, Karachi be returned to the plaintiffs in redemption of the equitable mortgage. The sale dated 4th May, 1971 is declared void, illegal and without authority and the same be cancelled and the District Registrar, Karachi be directed to record such cancellation. ' issues in Suit No, 606/77 are as follows :- ISSUE NO.
1. In the negative.
2. In the affirmative. If tf 3. In the negative.
91 4. The sale is void and not binding. If 5. In the negative. /if 6. Not pressed. t.
7. Suit dismissed.
' In the result suit No, 1/72 is decreed with costs and suit No, 606/77 is dismissed with no order as to costs.
Order accordingly.