Summary
A co-owner’s attorney sold property under a document permitting leases, borrowing and execution or registration of documents, but containing no authority to sell. The Court held that those powers could not be expanded into a sale power and that the purchaser failed the reasonable-care requirement for protection as transferee from an ostensible owner. It rejected constructive notice attributed to the principal and restored the preliminary partition decree without requiring cancellation of the alienations in this suit.
Issues
- Whether general execution and registration powers authorised sale in the absence of an express sale power.
- Whether ostensible-ownership protection or constructive notice defeated the principal’s partition claim.
- Whether cancellation of the alienations was indispensable to the partition relief sought.
Provisions considered
- Section 41 and proviso, Transfer of Property Act, 1882The purchaser failed to exercise reasonable care to ascertain authority, which inspection of the power of attorney would have shown was absent. (¶ 10-11)
- Section 3, notice interpretation clause and Explanations I-III, Transfer of Property Act, 1882The High Court wrongly attributed constructive notice of the attorney’s alienations to the principal by applying provisions concerning acquiring parties in reverse. (¶ 12-13)
Held
- The power of attorney required strict construction. Express powers to lease, borrow against security and execute or present documents did not imply authority to sell; drafting skill, punctuation and registration requirements could not enlarge its terms. (¶¶ 8-9, 16-18)
- Reasonable care would have revealed the absence of a sale power. The purchaser could not invoke section 41 to overcome that defect. (¶ 10-11)
- The constructive-notice analysis could not be inverted to charge the principal with notice of her attorney’s unauthorised sales. An agent’s possession was also the principal’s possession; the unauthorised sale did not itself establish that the principal had parted with possession. (¶ 12-14)
- A partition plaintiff need not invariably seek cancellation of alienations. A transferee may claim against the transferring co-sharer’s share or seek appropriate allotment in final-decree proceedings, allowing equities to be worked out. The omission did not defeat this partition claim. (¶ 15)
- The attorney could not convey authority or title she lacked, and subsequent purchasers could not acquire a better title through those unauthorised transactions. The principal’s preliminary partition decree should therefore be restored. (¶ 19-20)
Result
Appeal allowed; the High Court’s judgment was set aside and the trial court’s judgment and preliminary partition decree restored. No costs.