“Transferability of property is the general rule; its non-transferability is an exception under Transfer of property Act”. Discuss and explain in brief the exceptions.
Introduction:
Before the transfer of property act came into existence in 1882, the transfer of immovable properties in India were governed by the principle of English law and equity. Property has been given a rather wide spectrum covering both tangible material things, e.g., land and houses as well as rights which are not exercised over any material, e.g., a right to repayment of a debt. The word ‘transfer’ in the Act has also been used in a wide sense. It may mean either transfer of all the rights and interests in the property or transfer of one or more of subordinate rights in the property. Transfer of Property Act, 1882 is a civil legislation of immense importance owing to the vast number of property related transactions taking place throughout the country. A uniform legislation was the need of the hour considering this factor, and this act was drafted to serve the selfsame purpose.
The transfer of property Act:
[The Transfer of Property is defined as an act by which a living person conveys property, in present or in future, to one or more other living persons, or to himself, and one or more other living persons, and ‘to transfer property’ is to perform such act.]1 In this section ‘living person’ includes a company or association or body of individuals, whether incorporated or not, but nothing herein contained shall affect any law for the time being in force relating to transfer of property to or by companies, associations or bodies of individuals. However the general provision of this act will not affect provisions of any special law dealing with transfers of property by companies, associations or body of individuals.
According to this analyzing it can be said that the transfer of property is an act of conveyance, conveyance is affected through living persons, these properties may be conveyed either to one or more other living person, or himself, or to himself with one or more other living persons, property may be transferred either in future or in present.
Property of any kind may be transferred, except as otherwise provided by this Act or by any other law for the time being in force
(a) The chance of an heir- apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of a kinsman, or any other mere possibility of a like nature, cannot be transferred.
(b) A mere right of re- entry for breach of a condition subsequent cannot be transferred to anyone except the owner of the property affected thereby.
(c) An easement cannot be transferred apart from the dominant heritage.
(d) An interest in property restricted in its enjoyment to the owner personally cannot be transferred by him.
(dd) 1[ A right to future maintenance, in whatsoever manner arising, secured or determined, cannot be transferred.]
(e) A mere right to sue 2[ cannot be transferred.
(f) A public office cannot be transferred, nor can the salary of a public officer, whether before or after it has become payable.
(g) Stipends allowed to military 3[ , naval], 4[ air- force] and civil pensioners of 5[ Government] and political pensions cannot be transferred.
(h) No transfer can be made (1) in so far as it is opposed to the nature of the interest affected thereby, or (2) 6[ for an unlawful object or consideration within the meaning of section 23 of the Indian Contract Act, 1872 (9 of 1872 ),] or (3) to a person legally disqualified to be transferee.
(i) 7[ Nothing in this section shall be deemed to authorize a tenant having an un-transferable right of occupancy, the farmer of an estate in respect of which default has been made in paying revenue, or the lessee of an estate under the management of a Court of Wards, to assign his interest as such tenant, farmer or lessee.]1
General Rule of Transferability of Property:
The transferability of property is the general rule and non-transferability is an exception. [Transferability of property is based on the maxim alienation rei prae fertur juri accrescendi which means to say that alienation is favored by the law rather than accumulation.]2The general policy is to promote free alienation and circulation of property rather than accumulation of it.
[Section 6 of the Transfer of Property Act, 1882 says that property of any kind may be transferred excepting the non-transferability property. Transfer of the property can be prohibited only by provision of the law and not by the judgment or direction. Restrictions contained in tendency legislation can be waived by the competent authority.]1
1) Spes Successions:
[Spes successions means exception of succession; it is a possibility of getting property in future through succession.]2 The things referred to in this sub-section as non-transferable are the chance of an heir apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of the death of a kinsman, and other mere possibility of a like nature. This clause says that spes successions are not transferable.
a) Chance of an heir-apparent:
Heir apparent is not a legal heir but apparently an heir. Heir apparent is that person who would be the heir if he survived the propositus and if the propositus dies intestate. Propositus is a deceased person whose property the heir apparent is going to inherit. The chance of an heir apparent to succeed to an estate is only an exception which may be defeated by the act of some person having the present power to dispose of the property. It is indisputable law that no one can have any estate or interest, at law or in equity, contingent or others, in the property of a living person to which he hopes to succeed as heir at law next of kin of such living person.
Reversionary is a person who inherits the properties of a widow held by her for life. During the life of widow this right remains suspended but it reverts back to the reversionary on her death provided the reversionary survived her.
b) legacy:
[Legacy means expectancy of getting certain property under a will. A will becomes operative only after the death of the testator. If a person has made two or more wills, then only the last will make by him will be operative.]1 Legatee under the last will only will get the legacy. Expectancy to receive legacy is uncertain because the legatee may or may not survive the testation and the testator may have changed the name of the legatee in his last Will. Therefore, the chance of a legacy has been made non –transferable.
c) Any other possibility of a like nature:
Clause the chance of an heir-apparent excludes any other possibility of a like nature from the purview of transferability. [If there is any other possible property or interest which is as uncertain as spes successionis or legacy, that too will not be transferable.]2 Any property which is merely a future uncertain possible interest should not be made a transferable property.
2) Clause (b): Right of re-entry:
Clause (b) constitutes second exception to the general rule of transferability. [By a mere right of re-entry is meant a right to resume possession of land which has been given to another person for a certain time.]3 This is the right which a lessor keeps reserved for
himself after parting with the whole estate. The right of re-entry is that right which the lesser has against the lease of his property for breach, the lessor may re-entry. This right of the lessor is not transferable.
For example, where X grants a lease of plot of land to Y for a period of 5 years, at the expiry of 5 years he transfers his right of re-entry to Z. this transfer is valid as a transfer to the entire remaining rights of X.
3) Clause (c) Easement:
Third exception is the general rule of transferability says that an easement can’t be transferred apart from the dominant heritage. According to section 4 of the Easements Act, 1882, an “easement is a right which the owner or occupier of a certain land possesses as such for the beneficial enjoyment of that land to do and continue to prevent something being done, in or upon or in respect of certain other land which is not his own. [An easement involves the existence of a dominant heritage and a serviette heritage. That is, there must be two parcels of land, one (the dominant heritage) to which the benefit of the easement attaches, and another (the servient heritage) which bears the burden of the easement. But technically an easement cannot exist in gross (independently of the ownership of land but only as appurtenant) attached to a dominant heritage. It follows therefore that an easement cannot be transferred without the property which has the benefit of it.]1
For example, A, who is owner of a house, has a right of way over the land of B which adjoining to his land. A transfers his right to way over the land of B to C. A can’t do this
4) Clause (d) Restricted interest:
Clause (d) dealing with fourth exception says that an interest in property restricted in its enjoyment to the owner personally can’t be transferred by him. This means that a person’s right or interest which is only for his enjoyment cannot be transferred by him. Where a person a gives a land to another B for his personal use only. B can’t extend that use of land of any third person. Transfer of such interest would defeat the whole purpose of the restriction. [Under this clause, the following kinds of interest have been held not to be transferable:—
(a) A religious office
(b) Emoluments attached to priestly office. Where, however, the right to receive offerings made at a temple is independent of an obligation to perform services involving qualifications of a personal nature, the right is transferable.6
(c) A right of pre-emption.
(d) Service tenures.]1
5) Clause (dd) Right to future maintenance:
[Fifth exception in clause (dd) provides that a right to future maintenance, in whatsoever manner arising, secured or determined can’t be transferred.]2 Before the insertion of this Sub-section in 1929, there was a conflict of opinion whether the right to future
maintenance when it was fixed by a decree was transferable. The result is that the assignment of a decree for maintenance is valid if the maintenance has already become due but as to future maintenance it is not valid. Arrears of maintenance, therefore, can be assigned.
Although the right of maintenance is not transferable, the arrears of maintenance can be transferred. The right of maintenance is a personal right of a Hindu widow which is incapable of assignment but arrears of maintenance can be attached and sold like any other debt.
6) Clause (e) Right to Sue:
Clause (e) containing the sixth exception provides that a mere right to sue can’t be transferred. This means that bare right to sue can’t be transferred. [Right to sue for a definite sum of money is an actionable claim and can be transferred but right to sue for indefinite sum of money is not transferred.]1 Right of action for damages in tort or breach of contract are bare rights to sue, and therefore can’t be transferred. The social policy underlying the non-transferability of mere right to sue for unliquidated damages is to prohibit the practice of gambling over litigation. [Where the right to sue is connected with a business and the whole of the business is transferred, the right to sue is also automatically transferred.]2 Where a partnership firm entered into a contract with the government and all the partners except A retired from partnership firm, all the rights and liabilities of the firm were transferred to the sole partner left behind, according to the retirement deed of partnership, it was held that a suit by A for damages for breach of contract against the Government will not come under exception clause(e).[The property of a minor was sold by his father without any legal necessity or with the permission of the court. Therefore, the sale was voidable at the opinion of the son who was the real owner.]1
For example, A agrees to sell B a certain quantity of gunny bags to be delivered after few days. Before the delivery, B transfers his beneficial interest in the contract to C. When A commits a breach of contract, C becomes entitled to sue A for damages for breach of contract because along with the transfer of beneficial interest right to sue is also transferred because here it is an actionable claim.
7) Clause (f) Public office:
Clause (f) constitutes seventh exception to the general rule of transferability. A public office is held for qualities personal to the incumbent, and obviously it would be against public interest to permit alienations of public officer. It provides that a public office can’t be transferred, nor the salary of a public office, whether before or after it has become payable.
[In Corporation of Liverpool v. Wright:
“Where the law assigns fees to an office, it is for the purpose of upholding the dignity and performing properly the duties of that office and the policy of the law will not allow the officer to bargain away those fees to the appointer or anyone else.”]
The prohibition on the transfer of a public office or salary of a public officer is on the basic of public policy. A person is chosen to hold a public office for qualities personal to him and if he were allowed to transfer it, there is possibility that public duties may not be discharge. The salary is given to a public officer for the purpose of upholding its dignity and the proper performance of his duties and, therefore, it is also not transferable.
8) Clause (g) stipends and Pensions:
Clause (g) consisting of eight exception provides that the stipends allowed to military, naval, air-force, and civil pensions of the Government and political pensions cannot be transferred. [Pension means a periodical allowance or stipends granted not in respect of any right to office but an account of past service or particular merit.]1 A bonus or reward is not a pension. Allowances granted for other consideration can be transferred. [Accordingly, a reward is not a pension. Section 60 of the Civil Procedure Code also exempts a pension from attachment in execution of a decree against the pension holder.]2
9) Clause (h) Nature of Interest, Unlawful Object, Disqualification of Transferee:
Clause (h) deals with three classes of cases. [It says that no transfer can be made- in so far as it is opposed is the nature of the interest affected thereby; or for an unlawful object or consideration within the meaning of section 23 of the Indian Contract Act, 1872; or to a person legally disqualified to be transferee.
· Transfer Opposed to the nature of Interest
If the nature of the property to be transferred does not admit of such transfer, the transfer is not valid. Air, water, space, sea, light, etc are given by the nature to be used by each individual on earth. It is not possible to hold and possess them separately. If anyone tries to transfer such a thing it would be opposed to its nature.
· Transfer for an Unlawful Object or Consideration
A transfer cannot be made if it is for unlawful object or consideration. A property otherwise transferable may not be transferred if the transfer is for an unlawful object or consideration.
[Under section 23 of the Indian Contract Act, 1872, a consideration or object is unlawful, if- it is for bidden by law, or it is of such a nature that if permitted it would defeat the provisions of any law, or if it is fraudulent, or if it involves injury to the pension of another, or if it is immoral or opposed to public policy.]1
· Legality Disqualified Transferred
A legally disqualified person cannot be a transferee. Like- the property cannot be transferred to him. [Section 136 of this Act disqualifies certain persons to be transferee of any actionable claim. A Judge, a legal practitioner or an officer connected with courts of justice are disqualified from purchasing any actionable claim.]
10) Clause (i) Untransferable Interests
Clause (i) provide that nothing in this section shall be deemed to authorize a tenant having an untrasnferable right of occupancy, the farmer of an estate in respect of which default has been made in paying revenue, or the lessee of an estate, under the management of a Court of Wards, to assign his interest as such tenant, farmer or lessee. [The last sub-section of Section 6 is identical with the proviso in Sub-section (i) of Section 108 of this Act and was inserted by the Amendment Act, 1885 to obviate any doubt which might arise owing to the fact that section does not primarily apply to leases for agricultural purposes.]1[Under this clause, any tenant having an untrasferable right of occupancy cannot transfer his interest as such tenant.]2The farmer of an estate in respect of which default has been made in paying revenue cannot transfer his interest as such farmer and the lessee of an estate under the management of the Court of Wards cannot assign his interest as such lessee to any other person.
Conclusion:
All the property may be transferred this is subject to the exceptions mention in the above Act. Transfer of all other categories of property is possible and this act is in furtherance of the selfsame objective of arriving at the desired level of uniformity in terms of regulating property issues.
Reference
1. Transfer of Property Act, 1882, (n.d), Retrieved from
http://dolr.nic.in/Acts&Rules%5CTransferOfPropertyAct%281882%29.htm
2. Property of “any kind” may be Transferred, (n.d), Retrieved from
http://dolr.nic.in/Acts&Rules%5CTransferOfPropertyAct%281882%29.htm
3. Transfer of Property Act, 1882, Retrieved 1882, from
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