Summary
Landowners who signed a joint venture agreement and an irrevocable power of attorney in favour of a developer were held jointly liable with the developer to the flat purchasers. The developer made the sale agreements while the power of attorney was in force, the 2014 revocation letter applied only from then on, and the joint venture agreement had never been revoked.
Issues
- Whether landowners who did not sign the sale agreements could be held jointly liable in consumer complaints for the developer's failure to deliver flats.
- Whether revoking the irrevocable power of attorney by letter dated 12.08.2014 freed the landowners from liability for agreements the developer made before that date.
Held
- On 06.07.2013 the appellants executed an irrevocable power of attorney together with a joint venture agreement, and the developer took up the development under them. The power of attorney was allegedly revoked by letter dated 12.08.2014, but the joint venture agreement was never revoked and remained in force. (¶ 8)
- The revocation letter said the appellants would not be liable from then on. The appellants therefore remained bound by what the developer did under the irrevocable power of attorney until it was ended in accordance with law, and that included sale agreements made with the complainants before the letter. (¶¶ 7, 8)
- The appellants had taken no action against the developer for any breach of the joint venture agreement. They were therefore not entitled to say that they were not liable for the developer's acts. (¶ 8)
- The NCDRC had dealt with the joint liability of the landowners and the developer. The Supreme Court found no good ground to interfere with the concurrent findings that the landowners must take part in completing construction and executing sale deeds for the complainants. (¶¶ 9, 10)
Result
Appeals dismissed. The NCDRC order of 28.11.2017 and the State Commission order of 10.07.2017 were upheld, including the direction that the landowners and the developer jointly complete construction, hand over possession and execute sale deeds.