Essay: The Doctrine of Part Performance

The Doctrine of Part Performance finds its basis from the concept of equitable rule of part performance which the Court of Chancery developed under the English legal system. The first case where the Court of Chancery implemented the rule was Foxcroft v. Lyster , it was observed by Lord Redesdale,
“It was against the conscience to suffer the party who had entered and expended his money on the faith of a parol agreement to be treated as a trespasser and the other party to enjoy the advantage of the money he had laid out”.
This doctrine was subsequently added to the Transfer of Property Act, 1882 by virtue of Section 53A by the Amendment Act of 1929. The section stipulates for protecting prospective transferees in order to allow them to retain possession of the property against the transferors who execute an incomplete instrument of transfer and afterwards fail to complete it in the manner laid down by the law without there being any fault on part of the transferee. The Privy Council and the Supreme Court has described this section as a partial importation of the equitable doctrine of part performance. Like in England, this section does not stipulate for equity through part performance, it’s only available as a statutory right. In two aspects this right is more restricted as compared to the equitable doctrine of England: (1) There must be a written contract – the English doctrine also provides for oral contracts contrary to this section, (2) It is only available as a defence – the same can be used as a method of offence in England. It was clearly stated in the case of Hamida v. Humer that, the doctrine of part performance works on the principle of equity and it considers something as done which ought to have been done.
DIFFERENCE BETWEEN THE ENGLISH LAW AND THE RULE CONTAINED IN SECTION 53A
The important points of difference between the English equitable doctrine and the rule contained in this section are:
1. The English doctrine applies even to oral contracts, but this section is restricted to be applied only to contracts in: (a) writing, and (b) signed by the transferor, or on his behalf from which the terms necessary to constitute the transfer can be ascertained.
2. Under the English law: (a) both the transferor and the transferee can claim as plaintiff that the contract be specifically performed, and (b) each can resist a suit by the other claiming rights in violation of the contract; but, under this section, the transferor or any person claiming under him, is debarred from enforcing against the transferee and persons claiming under him, any right in respect of the property of which the transferee has taken possession, other than a right expressly provided by the terms of the contract, and the transferee cannot sue for any declaration on the ground of part-performance.
3. Under the English law, part-performance of a contract gives rise only to an equity and not to a legal right; but under this section, the part-performance gives rise to a statutory right of defence; but this right is only one, which, but for the lack of some formality, the party would have had under the written agreement. The section gives the party relying upon it only such rights which for the lack of some formality they would have had under the written agreement but it does not give any right which the informal agreement would not give.
CHAPTER II – SECTION 53A: ANALYSIS
Section 53A of the Transfer of Property Act, 1882 as inserted by the Transfer of Property (Amendment) Act 1929 stipulates the following:
“Where any person contracts to transfer for consideration any immovable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty,
and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract,
and the transferee has performed or is willing to perform his part of the contract
then, notwithstanding that where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefore by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract:
Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.”
Upon analysis of the section, in order for a claim to be based under Section 53A of the Transfer of Property Act, the following postulates are essential:
(i) A contract to transfer any immovable property for consideration should be there.
(ii) The contract must be in written form (cannot be oral), and the transferor must sign the same or someone on his behalf must.
(iii) The terms necessary for the purpose of construing the transfer much be clearly ascertainable from the writing in the contract.
(iv) The possession of the property or of any part thereof must have been taken by the transferee in part performance of the said contract.
(v) Some act to further the contract must have been done by the transferee.
(vi) The transferee must have performed or be willing to perform his part of the contract.
It depends on the facts and circumstances of each case as to what constitutes part performance. Roughly speaking, in order for an act to constitute part performance the act must be done in furtherance of the specific contract to which the doctrine is being applied and should be distinct from the acts which are ancillary or introductory or refer to some other arrangement. It is well settled that in order for an act to be considered as a part performance of a contract the same must be referable unequivocally to such a contract and must not be relatable to any other understanding or any other contract.
When the property is taken charge of only for the purposes of maintenance, repairs, improvements then in such a case the handing over of the possession for research purposes would not be covered under the part performance in furtherance of the contract, and thus is not covered by this section. An equitable entitlement cannot be given rise to in reference to part performance of an agreement in the cases when such gaining opposition is unrelated to the agreement.
OBJECT OF THE SECTION
The doctrine of part performance is an equitable doctrine which is embodied in section 53A. This section focuses on the objective of preventing a transferor or its successor from taking advantage due to the presence of document which is not registered, provided that the transferee has performed the part stipulated in the contract to be performed by him and in furtherance of such contract has taken the possession of some immovable property. The transferee has this right as a defence in order to defend his possession. This section gives effect to the equity of part performance and has partially introduced the doctrine of part performance into the Indian legal system. The section furnishes statutory defence in order to enable a party to maintain possession in the absence of a registered document even though he had performed his part of the contract. The main object of this provision is to prevent the transferor, or persons claiming under him, from claiming the title in contradiction of the rights of the other contracting party, who in furtherance of the contract entered into, have taken some action. This section aims to give a right to the defendant to protect his possession as against the transferor, or persons who claim under him, such as his heirs, assigns and legal representatives.
This section imposes a statutory bar on the transferor but it does not confer any title over the property in question on the transferee. Thus, the transferee cannot file a suit in order to declare his title to the property and recover possession on the basis of the title so claimed. The right given by this section can be enforced by the transferee as shield always but cannot be done so as independent claim either in the capacity of plaintiffs or defendants, the transferee cannot claim title under this section just because of the fact that he has fulfilled the conditions as laid down under this section.
SCOPE AND AMBIT
It is evident from the plain reading of this section that in order to avail the shield as provided by the section, a transferee, apart from satisfying other conditions, must have taken possession in part performance of the contract of the property in question and the same must have been done in furtherance of the contract.
If the contract in question does not fulfil the requirements of a valid contract then the plea under this section cannot be considered by the court. Thus, there has to be a valid contract in order for a transferee to avail protection under this section. The scope of this section is only limited to imposing a bar against the enforcement of rights by a transferor in respect of a property of which the possession has already been taken by the transferor. The section does not give any right to the transferee to claim possession or any other right on the basis of an unregistered transfer; it is only available as a defence to the transferee. In order for this section to be applicable, there has to exist a real nexus between the contract and the acts done in furtherance of the same or the acts which can be referred to that contract unequivocally. Where there is no contract of transfer or property in existence, the question of applicability of this section does not come into play. To attract the provision of this section, the transferor must be the owner, there should be an agreement to transfer by sale to the transferee for consideration and the possession of the transferee should be in pursuance of that agreement and the transferee must have done something more in furtherance of the agreement and he should be ready and willing to perform his part of the agreement from the date of the agreement.
APPLICATION TO MORTGAGES
This section is applicable where there exists a contract to transfer with consideration any immovable property. Thus, the section not only extends to sales but also to mortgages and exchanges. When all the essentials of this section are satisfied the defendant is entitled to invoke the benefit of the section. In the case of Habib v. Mahemud Mir, the appellant instituted a suit for redemption of a mortgage executed on 14th December, 1927. By the mortgage-deed a house was conditionally sold to the respondent on condition that if the consideration was repaid within six years, the property would be reconvened to the vendor. After the expiry of six years on 16th December, 1933, the respondent served a notice on appellant saying that, as the condition of repurchase had been broken; he had become the full owner of the property. On 1st February, 1935, the respondent paid a further sum, in lieu whereof the vendor relinquished all rights in the property in favour of the respondent, but the document was not registered, although the respondent continued all along in possession. It was held that by the document of 1st February, 1935, the appellant must be deemed to have given up whatever rights he had, When he unconditionally surrendered to the other party, all his outstanding rights in the property, he could not thereafter be heard to say that he parted only with one such right and not the other of which he was not then aware : and that, as all the ingredients of this section were satisfied, the respondent mortgagee was entitled to invoke the benefit of this section for resisting plaintiffs suit for redemption.
APPLICATION TO LEASE
If a suit is filed by a lesser, the applicant/defendant who evidently was in the position of the land or property by virtue of their being a lease deed, even though unregistered, and take the defence under section 53A of the Transfer of Property Act to protect his possession. So far a tenant already in possession with a covenant for renewal in his favour can resist his eviction by the landlord without filing a suit for specific performance if he has validly exercised his option and if the suit for specific performance of the agreement for renewal is not barred by limitation on the date of landlord’s suit, on the equitable principle of part performance recognised under the Transfer of Property Act.
In Lal Behari v. Kanakkanti, B executed a patta for 25 years in favour of K on a monthly rental, The patta was not signed by K but K went into possession and effected improvements in terms of the patta. B sued K for arrears of rent and eviction before the expiry of the patta. It was held, that there was no implied tenancy from month to month, but the doctrine of part-performance was applicable, It was said, that from patta the terms necessary to constitute a transfer can be ascertained with reasonable certainty, that the appellant in part-performance of the contract has taken possession of the subject of the contract, that is, the disputed premises, that he has been performing his part of the contract, and that, on these premises, the transferor is debarred from enforcing against K any right other than the right expressly provided by the terms of the contract; and that, as it is expressly provided that K shall remain in the premises undisturbed by B, this section does come to the aid of K.
Under this section even an unregistered lease is admissible in order to defend possession obtained in furtherance of the part performance of the lease agreement. The Lessee cannot rely upon the lease agreement and its terms which relates to 30 years lease period and thus cannot take advantage of this section to protect his possession for 30 years.