Thursday, 20 October 2016

Whether family settlement will be binding on members of family even if it is not signed one of parties?

 We agree with the proposition that a

family settlement is binding on the members of the

family even if one of the parties have not subscribed

his signature to the deed.               But there should be

clinching evidence to show that the party who is not a

signatory to the deed has acquiesced in the settlement

by his subsequent conduct. 


                    MR.JUSTICE K.HARILAL

        30TH DAY OF SEPTEMBER 2016
                             AS.No. 86 of 2001 

           SOSAMMA OOMMAN, 

         ANNAMMA SIMON, 


         The brother sets up a 'family settlement' in a

bid to coerce his siblings to agree for property in

lieu of that settled on them by their father.

         2.  One Oommen Simon died on 7.8.1986 leaving

behind his widow, one son and six daughters as his

legal heirs who are all parties to O.S.No.79/1989 which

is taken as the lead suit. The son is the plaintiff

and the widow and daughters are the defendants in the

suit which is one for partition and for a direction to

execute a deed of conveyance.   Such deed is sought to

be executed in furtherance of Ext.A1 agreement dated

16.9.1986  conceding  to   re-partition  the   property

earlier owned by Oommen Simon. The parties are referred

to as per their rank in O.S.No.79/1989 which was

disposed of along with O.S.Nos.67/1991, 68/1991 and

98/1991 and evidence was recorded in common. Defendant

No.7 filed O.S.No.67/1991 for declaration of title and

recovery of possession and O.S.No.68/1991 for partition

of property. Defendant No.6 filed O.S.No.98/1991 for

declaration of title and recovery of possession of

property and all the suits were disposed of by the

common judgment impugned. The court below has dismissed

O.S.No.79/1989 and decreed O.S.Nos.67/1991 and 98/1991

declaring        the  title   and  granting   recovery   of

possession.        A preliminary decree for partition has

also been passed in O.S.No.68/1991 granting 1/6         and

2/21 shares over item No.1 and items Nos.2 and 3 of the

plaint schedule property. The plaintiff has come up in

appeals and the cardinal issue to be considered in the

case    is    as   to  whether Ext.A1  agreement  could be

construed as a 'family settlement'.

             3.    We heard Mr.S.V.Balakrishna Iyer, Senior

Advocate      on   behalf  of the  plaintiff/appellant  and

Mr.K.P.Satheesan, Senior Advocate on behalf of the


             4. It is in evidence that Oommen Simon had

executed      Ext.B8  settlement  deed  in  favour  of the

defendant No.7 and Ext.B13 settlement deed in favour of

the    defendant No.6 on 14.5.1985. Oommen Simon had also

executed Ext.B11 settlement deed on the same date in

favour of defendants 2 to 7 who are his daughters

excluding his wife and son. It transpires that Oommen

Simon     had     even  earlier  executed  settlement  deeds

(Document      Nos.2859/1984,   2861/1984  &  2870/1984)  in

favour of defendants 3, 4 and 5. This is in addition to

a settlement deed (Document No.2871/1984) in favour of

the    plaintiff     and  his  wife  and  a  Will  (Document

No.III/37/1984) which are not produced. All the above

documents have been registered in the office of the Sub

Registrar, Adoor within whose jurisdiction Oommen Simon

allegedly owned 5 cents of land.        Nobody has impeached

the settlement deeds hitherto and no evidence has been

let in to show that Oommen Simon did not own property

at Adoor to enable registration.       There is also no plea

that the settlement deeds have not been acted upon or

that the mutation have not been effected in the revenue

records pursuant thereto.

            5.     It is admitted that defendant No.7 is not

a signatory to Ext.A1 agreement and it remains to be

adjudged as to how the same would affect her rights

prejudicially.       The agreement opens by stating that the

property requires to be re-partitioned and nothing at

all is mentioned about the execution of the settlement

deeds and Will referred to earlier.       It is also stated

therein that the plaintiff deserves to get 84 cents

(item     No.3     of  the   plaint  schedule  property  in

O.S.No.79/1989) towards his share. The compensation for

the acquisition of 1.67 acres (item No.2 of the plaint

schedule property in O.S.No.79/1989) is to be divided

into eight equal shares for the mother and 7 children.

The agreement in addition states that the property of

extent 3.18 acres and 1 acre deserves to be allotted to

defendant Nos.2 to 7 in equal shares to the exclusion

of the plaintiff.         There is another clause in the

agreement which emphasises the need to pay maintenance

to the first defendant apart from her share of the land

acquisition compensation. The necessity to solve the

financial problem of the third defendant who is not

affluent can also be deciphered from a reading of the

agreement.        The agreement concludes by stating that a

registered deed of conveyance has to be executed by the

parties with due deference to the terms of Ext.A1

agreement afore-stated.

            6.     The following are the guiding factors to

decide as to whether Ext.A1 agreement is a family

settlement or not as held in Kale and other v. Deputy

Director of Consolidation [AIR 1976 SC 807]:

            (1)    The family settlement must be a bona

                   fide one so    as  to resolve family

                   disputes and rival claims by a fair

                   and equitable division or allotment of

                   properties between the various members

                   or the family;

            (2)    The said settlement must be voluntary

                   and should not be induced by fraud,

                   coercion or undue influence;

            (3)    The family arrangements may be even

                   oral in which case no registration is


            (4)    It is well settled that registration

                   would be necessary only if the terms

                   of the family arrangement are reduced

                   into   writing.      Here   also,    a

                   distinction should be made between a

                   document  containing  the  terms  and

                   recitals of a family arrangement made

                   under  the   document   and   a  mere

                   memorandum prepared after the family

                   arrangement  had  already  been  made

                   either for the purpose of the record

                   or for information of the court for

                   making necessary mutation. In such a

                   case the memorandum itself does not

                   create or extinguish any rights in

                   immovable  properties  and   therefore

                   does not fall within the mischief of

                   Section    Sec.17(1)(b)     of     the

                   Registration Act and is, therefore,

                   not compulsorily registrable;

            (5)    The members who may be parties to the

                   family  arrangement  must  have   some

                   antecedent title, claim or interest

                   even a possible claim in the property

                   which is acknowledged by the parties

                   to the settlement. Even if one of the

                   parties to the settlement has no title

                   but under the arrangement the other

                   party relinguishes all its claims or

                   titles in favour of the such a person

                   and acknowledges him to be the sole

                   owner, then the antecedent title must

                   be assumed and the family arrangement

                   will be upheld and the Courts will

                   find no difficulty in giving assent to

                   the same;

            (6)    Even if bona fide disputes, present or

                   possible, which may not involve legal

                   claims are settled by a bona fide

                   family arrangement which is fair and

                   equitable the family arrangement is

                   final and binding on the parties to

                   the settlement. (emphasis supplied)

The specific case in the plaint is that the parties to

the suit assembled in the house of defendant No.4 on

the 41st day of the death of Oommen Simon and agreed to

re-partition the property. The settlement was reduced

into writing evidenced by Ext.A1 agreement               to which

the plaintiff and the defendants except defendant No.7

subscribed their signature. There is no case for the

parties that a decision was already taken to re-

partition the property and that it was recorded in

Ext.A1 agreement as a past transaction.           The execution

of   Ext.A1       agreement  was   contemporaneous    with  the

decision to re-partition the property in supercession

of all the earlier deeds. Ext.A1 agreement purporting

to extinguish the existing rights and create new rights

therefore requires registration under Section 17(1)(b)

of the Registration Act, 1908. Ext.A1 agreement on the

other hand intends to create right in presenti and the

same sans registration has no validity in the eye of

law as a family settlement.         We are fortified in this

view by the decision in Tek Bahadur Bhujil v. Debi

Singh Bhujil and others [AIR 1966 SC 292] wherein it is

held as follows:-

            "Family arrangement as such can be arrived

             at orally.   Its terms may be recorded in

             writing as a memorandum of what had been

             agreed  upon between  the parties.    The

             memorandum need not be prepared for the

             purpose of being used as a document on

             which future title of the parties     be

             founded.   It is usually prepared as a

             record of what had been agreed upon so that

             there  be  no  hazy  notions  about  it  in

             future. It is only when the parties reduce

             the family arrangement in writing with the

             purpose of using that writing as proof of

             what   they had  arranged  and,  where  the

             arrangement  is   brought   about  by   the

             document as such, that the document would

             require registration as it is then that it

             would be a document of title declaring for

             future what rights in what properties the

             parties possess." (emphasis supplied)

Ofcourse an unregistered agreement could be used as a

corroborative        evidence   to   explain     the   subsequent

conduct of parties as held in Subraya M.N. v. Vittala

M.N. And others [2016 SAR (Civil) 772 (SC)].

            7.      We agree with the proposition that a

family settlement is binding on the members of the

family even if one of the parties have not subscribed

his signature to the deed.               But there should be

clinching evidence to show that the party who is not a

signatory to the deed has acquiesced in the settlement

by his subsequent conduct. The decisions in Munnalal v.

Suraj Bhan and others        (AIR 1975 SC 1119) and Narendra

Kante v. Anuradha Kante and others (2010 (2) SCC 77)

lend support.        There is no such conduct on the part of

the defendants to hold that they have acquiesced in the

family settlement evidenced by Ext.A1 agreement in

order to operate as an estoppel. The mere fact that

defendants 3, 4 and      7 signed a cheque for ` 1,90,278/-

on 10.6.1989 in favour of the plaintiff towards his

share of the compensation amount has no significance.

The same done pending the disposal of O.S.No.79/1989

filed on 5.4.1989 dividing the compensation amount

equally between the mother and children was surely a

transaction hit by lis pendens. Nothing much turns out

on this transaction even though it is stated that the

amount was agreed to be divided equally amongst the

daughters only under the Will.

            8.     We also find that the terms in Ext.A1

agreement are inchoate and incomplete      as regards the

quantum of maintenance to defendant No.1 and the extent

of financial support to defendant No.3. The same are

yet to be finalised by the parties and moreover      Ext.A1

agreement       itself stipulates  the  necessity   for   a

registered conveyance deed.       There has also to be a

division by metes and bounds of 3.18 acre and 1 acre

allotted to defendants 2 to 7 jointly as per the

agreement for the lis to end. An unregistered agreement

can be treated as a family settlement only if it

records past transaction and is complete in itself as

regards the rights and liabilities.       We are also not

impressed by the contention of the plaintiff that

defendant No.7 left the place even before the drafting

of   Ext.A1        agreement was completed. This  is   so

notwithstanding the fact that the presence of defendant

No.7 at the place is conceded to by defendant No.6 in

her written statement and also in evidence.      We find

that Ext.A1 agreement falls short of the requisite

essentials to hold that the same is a family settlement

in supercession of all the earlier deeds.

            9. Neither the decree in O.S.No.67/1991 nor

the decree in O.S.No.98/1991 can be faulted with since

the same is filed by defendant Nos.7 and 6 on the basis

of Exts.B8 and B13 settlement deeds.         Very little

evidence is required to show that a settlement deed in

favour of a dependent has been acted upon unless the

gift is onerous or burdensome. Equally impeccable is

the preliminary decree for partition in O.S.No.68/1991

wherein the personal law has been applied in relation

to the 10 cents of land left out in the deeds.          The

property covered by Ext.B11 settlement deed has been

rightly directed to be divided amongst defendants 2 to

7 equally as per the terms thereof.            There is no

warrant to interfere with the impugned judgment whereby

O.S.No.79/1989       is dismissed      and  O.S.Nos.67/1991,

68/1991 and 98/1991 are decreed.

            The Appeal Suit and the Regular First Appeals

are dismissed with costs.



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