Vested Remainder and Contingent Remainder

An Inquisition under Transfer of Property Act.

Saji Koduvath, Advocate, Kottayam.

Abstract of the Contents

  1. Legal Remainders arise when two or more future successive estates are created in a land (E.g. transfer to A for life and then to B).
  2. Transfer of Property Act does not specifically speak about ‘Legal Remainder’. But, the illustrations in Sections 13, 24, 27 and 126 clearly lay down this right.
  3. A ‘Transfer’ with Right of Alienation and a stipulation: ‘If property remains’ on death of transferee, it will go to another – Valid.

PART – 1

Vested Remainder and Contingent Remainder

What is ‘Legal Remainder’ is explained in “Modern Law of Real Property” by Chesire, Twelfth Edition as under:

  • Legal Remainders. Common law permitted future interests, called remainders, to be carved out of a legal estate, though as we shall see presently, there were several restrictive rules which had to be observed. If a stellar decided to create two or more successive estates in his land, and drafted the desired limitations in one instrument, as for instance by a fulfilment to A for life and then to B, for life and then to C, in fee simple, the first estate which preceded the next following remainder was called the “particular estate” and those which followed were denominated “remainders”. (Quoted in Bomi Munchershaw Mistry v. Kesharwani Co-Operative Housing Society, 1993 (2) BomCR 329.)

Vested Remainder and Contingent Remainder in TP Act

Transfer of Property Act does not specifically speak about ‘Legal Remainder’. But, the illustrations in Sections 13, 24, 27 and 126 (mentioned below) clearly lay down this right. Indian courts apply the doctrine of ‘legal remainder’, inasmuch it hold – both the reversioner (future right that accrues by operation of law) and the legal remainder (future right that accrues by act of persons – executing documents) have the right to protect their (future) right, through court [Yellarayhala Surayya v. Yellaraghahs Subbamma, (1920) ILR 43 Mad 4].

See Blog: Transfer of Property with Conditions & Contingent Interests

Can a property be ‘transferred’ (successively) to one, and after his death (or on happening an event) to another?

Yes. It is clear from the following illustrations in the TP Act.

No.Sec.Illustration
 113. Transfer for benefit of unborn person  A transfers property of which he is the owner to B in trust for A and his intended wife successively for their lives, and, after the death of the survivor, for the eldest son of the intended marriage for life, and after his death for A’s second son. The interest so created for the benefit of the eldest son does not take effect, because it does not extend to the whole of A’s remaining interest in the property.
 224. Transfer to such of certain persons as survive at some period not specifiedA transfers property to B for life, and after his death to C and D, equally to be divided between them, or to the survivor of them. C dies during the life of B. D survives B. At B’s death the property passes to D.
 327. Conditional transfer to one person coupled with transfer to another on failure of prior dispositionA transfers property to his wife; but, in case she should die in his life-time, transfer to B that which he had transferred to her. A and his wife perish together, under circumstances which make it impossible to prove that she died before him. The disposition in favour of B does not take effect.
4126. When gift may be suspended or revoked.A gives a field to B, reserving to himself, with B’s assent, the right to take back the field in case B and his descendants die before A. B dies without descendants in A’s lifetime. A may take back the field.
  • Note: Illustration in Sec. 24 given above lays down ‘Vested Remainder’; and that in Sec. 27 lays down lays down an instance of ‘Contingent Remainder’.

Vested Remainder

Example – A transfers property to his wife; but, in case she should die in his life-time, transfer to B …. (Illustration in Sec. 27, TP Act)

  • A ‘vested remainder’ has to satisfy following ingredients:
    • (i) the person to whom the property is given must be a living person,
    • (ii) the estate must be (when the transfer is effected) with another,
    • (iii) the (actual) transfer is to take effect as soon as the estate with whom its remained (when the transfer is effected) is terminated,
    • (iv) the person in enjoyment (when the transfer is effected) holds the property subject to the rights of ‘vested remainder’ (in other words, it is one which is ready from its commencement to its end).

In Law of Property by Strahan – 4th Edition at page 152, it is observed as follows:

  • A vested remainder is a remainder of the more ancient kind, that is, one of the owner which is living and ascertained, and which is an actual estate in the land, complete in interest though deferred to the precedent estate in enjoyment. Being complete, it is ready, and must continue ready, from its commencement as a vested remainder till its expiration in natural course, to come into possession immediately on the determination of the preceding interest, the existence of which is the  only thing which prevents it being complete not merely in interest, but also in enjoyment. It is true it may fail, or, rather, determine before the period arrives, when it would vest in possession, but such determination must arise from its own natural expiration, not from any outside event or contingency.
  • Thus, take a limitation to A. for life and then to B. for life – B. being a living person. If B. predeceases A., his life estate will never become an interest in possession; but as long as B. lives, his estate is ready to come into possession the moment A.’s life estate determines.” (quoted in Nikhil v. Sarojini (2014-3 Ker LT SN 36)

In Law of Property by GC Venkata Subbarao – 2nd Edition, at page 130, it is observed as under:

  • Vested Remainder is Heritable.- Vested remainders and reversions are treated as future interests only for the reason that they do not carry immediate possession of the property. They are for all practical purposes present proprietary interests. As such they are heritable. Even if the person entitled to the vested remainder dies before the determination of the particular estate, his interest does not lapse but is transmitted to his heir. Of course, if the remainderman’s estate is a life-estate this rule can have no application. Where, he has an estate of inheritance, notwithstanding his death, before the estate falls in possession, his representative in interest can claim possession as soon as it becomes vacant by the expiration of the precedent interests. In this respect the vested estate resembles the reversion which is also a heritable or transmissible interest in property.” (quoted in Nikhil v. Sarojini (2014-3 Ker LT SN 36)

Contingent Remainder

Example – A transfers property to his wife; but, in case she should die in his life-time, transfer to B ….. (Illustration in Sec. 27, TP Act)

The principle of ‘Contingent Remainder’ is seen applied extensively, in India. It is usually applied in the following instances:

  1. Property is given to A for life; then to B, if A dies unmarried.
  2. Property is given to A (with saleable rights), then to B if property (or any part) remains unsold/un-transferred by A.
  • A ‘contingent remainder’ must have the following ingredients:
    • (i) the person to whom the property has to reach, finally, must be a living person,
    • (ii) the estate must be (when the transfer is effected) with another,
    • (iii) there will be a chance only to get the property to the (final) transferee; the transfer being contingent upon the stipulations or conditions (in other words, it is one which is not ready from its commencement to its end),
    • (iv) the (actual) transfer takes effect
      • (a) only on satisfying the conditions, and
      • (b) as soon as the estate with whom it is remained is terminated.

It is clearly laid down in Nikhil v. Sarojini (2014-3 Ker LT SN 36) it is observed in Para 32, 38 and 41 as under:

  • “32. The principle that can be carved out from the above literature is that a vested remainder is one which is ready from its commencement to its end, to take effect as soon as a particular estate shall determine. … … In the case of vested interest, the distribution is predetermined while in contingent interest, it may or may not. A contingent remainder is one which is not ready from its commencement to its end and it is to take effect as soon as particular estate is terminated.”
  • “38. In the decision reported in Narayani v. Sreedharan (2011(4) K.L.T. SN 107) it is held as follows:
  • “Even if by a document, the property which exclusively belongs to the executant is settled in favour of another, retaining his life interest in the property and providing that on his death the other would get absolute right in the property, it cannot be said that there was no transfer of interest in praesenti because of the retention of the life interest of the executant as there was divesting of the rights of the executant, except his life interest.”
  • “41. … But certain propositions emerge from a reading of the above decisions (Namburi Basava Subrahmanyam v. Alapati Hymavathi, 1996 Ker HC 1200, Kokilambal v. N. Raman. AIR 2005 SC 2468) and they are ;
    • i) There is no straight jacket formula to ascertain the nature of interest created.
    • ii) Each case depends upon the facts of that case and the deed that comes up for interpretation.
    • iii) Merely because the enjoyment or possession is postponed by itself is not a ground to hold that no vested interest is created.
    • iv) If interest in praesenti is created with condition, the transfer becomes effective immediately. But the interest is to take effect after the condition is satisfied, then it becomes a contingent (sic – vested) interest.”

PART – 2

Reconciliation of Apparent Inconsistent Provisions’ and ‘Harmonious interpretation

Section 11 of Transfer of Properties Act makes it clear that where a property is transferred absolutely, subsequent restraints are invalid. Therefore, the questions in such matters would be (i) whether the transfer effected stands ‘absolute’ or not and (ii) whether the restriction brings-up is one that canvases the section or not.

Section 11 of Transfer of Properties Act reads as under:

  • 11. Restriction repugnant to interest created– Where transfer of property, an interest therein is created absolutely in favour of any person, but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there were no such direction.
  • Where any such direction has been made in respect of one piece of immoveable property for the purpose of securing the beneficial enjoyment of another piece of such property, nothing in this section shall be deemed to affect any right which the transferor may have to enforce such direction or any remedy which he may have in respect of a breach thereof.

‘Irreconcilable/Inconsistent’ clauses in a Will

Section 88 of the Indian Succession Act says:

  • “88. The last of two inconsistent clauses prevails.–Where two clauses of gifts in a Will are irreconcilable, so that they cannot possibly stand together, the last shall prevail.

The Illustrations given in this Section make it clear what is an ‘inconsistent clause‘. It reads as under:

  • (i) The testator by the first clause of his Will leaves his estate of Ramnagar “to A”, and by the last clause of his Will leaves to “to B and not to A”. B will have it.
  • (ii) If a man, at the commencement of his Will gives his house to A, and at the close of it directs that his house shall be sold and the proceeds invested for the benefit of B, the latter disposition will prevail.”

Section 138 of Indian Succession Act, which reads as under:

  • Direction that fund be employed in particular manner following absolute bequest of same to or for benefit of any person.
  • Where a fund is bequeathed absolutely to or for the benefit of any person, but the will contains a direction that it shall be applied or enjoyed in a particular manner, the legatee shall be entitled to receive the fund as if the will had contained no such direction.”

From the above, it comes out that when a Will is construed, it must be considered:

  • Whether ‘on a whole-reading‘, there is irreconcilable inconsistency between two provisions (as stated in the illustration of Sec. 88 – the last of two inconsistent clauses prevails – in earlier clause property was given to A; latter clause, to B) so that harmonious interpretation is not possible?
  • Contingent transfers are legal and valid. Example – A transfers property to his wife; but, in case she should die in his life-time, transfer to B (Illustration in Sec. 27, TP Act)
  • Under Sec. 11 of the TP Act also, the latter condition is taken into consideration if only there is an ‘absolute‘ transfer. Under Sec. 11 of the TP Act (which reads: 11. Restriction repugnant to interest created– Where transfer of property, an interest therein is created absolutely in favour of any person, but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, …. ) the earlier ‘irreconcilable’ clause will prevail.
  • An attempt should always be made to read the two parts of the document harmoniously, if possible. It is only when this is not possible, e.g, where an absolute title is given is in clear and unambiguous terms and the later provisions trench on the same, that the later provisions have to be held to be void. (Ramkishore Lal v. Kamal Narain, AIR 1963 SC 890.)

In K. S.  Palanisami v. Hindu Community Citizens of Gobichettipalayam, AIR 2017  SC 1473 the joint Will executed by a couple created a Trust and indicated further that after the death of one of the spouse, the other (survivor) had Absolute right to deal with the property and there was no embargo on the right of survivor to dispose of the same.  Certain alienations were made by the wife after death of the husband. It is held in the decision as under:

  • “41. The above in plain words provides that on the death of any of the spouse, survivor shall enjoy the entire properties absolutely with all the rights. What is the connotation of words ‘absolutely with all the rights?’, whether the above provision in the Will can be read as only life estate i.e. right of enjoyment and receiving of rent, income or absolute right indicates the exercise of all the rights including the right of alienation.”
  • 42. The High Court after noticing the contention of Learned Counsel for the defendants formed the opinion that expression ‘absolutely’ should be read to mean that the surviving testator, namely, Rangammal would have only the life interest.
  • 50. We do not find any word or any indication in the Will to give a life estate to survivor. The Will clearly intended that survivor shall have absolute right to the properties and after his/her death; the charity shall be carried out from the income of the properties without alienation of the properties.
  • “57. We, thus, are of the view that giving absolute right to the survivor during his lifetime to deal with the properties in no manner cannot be said to be right given in disregard of object of trust. The charitable purpose of the Will is not lost even if survivor is given absolute right. The obligation of survivor to act in furtherance of object as agreed by both the testators survives and binds the survivor. Although the Will was irrevocable after the death of survivor but the Will expressly granted absolute right to survivor.
  • 58. In view of the foregoing discussion, we endorse the view of High Court that the Will dated 27.9.1968 was a joint and mutual Will, but with a rider that said joint and mutual Will was with an express condition that survivor shall have absolute right to deal with the property keeping the object of trust alive.”

Discordant Knots

It is a serious question – whether the observation in the following decisions as to ‘conflict between the earlier clause and the later clauses’ stands unsusceptible to (i) the doctrine of ‘harmonious interpretation’ and (ii) the following illustration in Sec. 27 of the TP Act: A transfers property to his wife; but, in case she should die in his life-time, transfer to B

The decisions are:

  • Mauleshwar Mani v. Jagdish Prasad, AIR 2002 SC 727
  • Sadaram Suryanarayana v.  Kalla Surya Kantham, AIR 2011 SC 294
  • Madhuri Ghosh v. Debobroto Dutta, AIR 2016 SC 5242.

I. In Mauleshwar Mani v. Jagdish Prasad, AIR 2002 SC 727 (two Judge Bench) considered a will containing the following provision –

  • “The first part of the Will provided that after the death of the testator or author of the Will, his wife whose name is Smt. Sona Devi would be entitled to the entire assets and properties of Jamuna Prasad with the right of transfer.
  • The second part of the Will is that after the death of Smt. Sona Devi nine sons of daughters’ would inherit the property.”

The Apex Court held that latter clause will not take effect observing as under:

  • “Where a testator having conferred an absolute right on anyone, the subsequent bequest for the same property in favour of other persons would be repugnant to the first bequest in the will and has to be held invalid.”

The Apex Court referred to Radha Sundar Dutta v. Mohd. Jahadur Rahim wherein it was held that where there was conflict between the earlier clause and the later clauses and it was not possible to give effect to all of them, then the rule of construction was well established that it was the earlier clause that must override the later clauses and not vice versa. It was also pointed out that in Rameshwar Bakhsh Singh v. Balraj Kuar it was laid down that where an absolute estate was created by a will in favour of devisee, the clauses in the will which were repugnant to such absolute estate could not cut down the estate; but they must be held to be invalid. The Court held:

  • “In Ramkishorelal and another vs. Kamalnarayan, 1963 Suppl. (2) SCR 417, AIR 1963 SC 890, it was held that in a disposition of properties, if there is a clear conflict between what is said in one part of the document and in another where in an earlier part of the document some property is given absolutely to one person but later on, other directions about the same property are given which conflict with and take away from the absolute title given in the earlier portion, in such a conflict the earlier disposition of absolute title should prevail and the later directions of disposition should be disregarded. In Radha Sundar Dutta Vs. Mohd. Jahadur Rahim & others (AIR 1959 SC 24 ), it was held where there is conflict between the earlier clause and the later clauses and it is not possible to give effect to all of them, then the rule of construction is well established that it is the earlier clause that must override the later clauses and not vice versa.” 

II. In Sadaram Suryanarayana v.  Kalla Surya Kantham, AIR 2011 SC 294, the two Judge Bench had to find whether the following clause in the will expressed an unequivocal intention of the Testatrix to make an absolute bequest in favour of her daughters. The relevant clause read as under:

  • “2nd item … shall devolve to my 2nd daughter …  and the Western wing 2 rooms shall devolve upon my elder daughter … with absolute rights of Sale, Gift, Mortgage etc., and this will come into force after my demise. After demise of my daughters the retained and remaining property shall devolve upon their female children only.”

Referring (i) Mauleshwar Mani v. Jagdish Prasad (supra – AIR 2002 SC 727) (ii) Ramki shore lal v. Kamalnarayan (supra – AIR 1963 SC 890) and (ii) Radha Sundar Dutta v. Mohd. Jahadur Rahimheld (supra – AIR 1959 SC 24), it is held in Sadaram Suryanarayana v.  Kalla Surya Kantham as under:

  • “We are, on the contrary, dealing with a case where the intention of the Testatrix to make an absolute bequest in favour of her daughters is unequivocal. Secondly, the expression “after demise of my daughters the retained and remaining properties shall devolve on their female children only” does not stricto sensu amount to a bequest contrary to the one made earlier in favour of the daughters of the Testatrix. The expression extracted above does not detract from the absolute nature of the bequest in favour of the daughters. All that the Testatrix intended to achieve by the latter part of clause 6 was the devolution upon their female offsprings all such property as remained available in the hands of the legatees at the time of their demise. There would obviously be no devolution of any such property upon the female offsprings in terms of the said clause if the legatees decided to sell or gift the property bequeathed to them as indeed they had every right to do under the terms of the bequest. Seen thus, there is no real conflict between the absolute bequest which the first part of clause 6 of the Will makes and the second part of the said clause which deals with devolution of what and if at all anything that remains in the hands of the legatees.”

III.  Madhuri Ghosh v. Debobroto Dutta AIR 2016 SC 5242 (Two Judge Bench): The testator bequeathed his property jointly to his wife and daughter. It was provided that in the event of the death of his wife the property would stand vested with the daughter as “exclusive owner”; and, in the event of the death of his daughter the property would stand vested with the wife as “exclusive owner”.  Thereafter, it was provided that various other lineal descendants would become owners of specified parts of the property. The Apex Court held that the will provided for ‘absolute’ bequest and not ‘limited interest’. Therefore, the direction that the lineal descendants would become owners of specified parts had no effect. The Court, inter alia, relied on Mauleshwar Mani v. Jagdish Prasad (2002) 2 SCC 468.

Analysis of the Above Line of Decisions

  1. The common law in India requires ‘reading the document as a whole‘, and give effect to the provisions on a harmonious interpretation. The apparent conflict mooted in the above cases can be harmonised reading the document as a whole.
  2. Illustrations in Sections 24 and 27 make it clear that Indian law recognises ‘vested remainder’ and ‘contingent remainder‘. (See illustrations given in these Sections.)
  3. It is also beyond doubt that such a transfer is not hit by Sec. 10 and 11 of the TP Act; inasmuch as Sec. 10 and 11 cumber only when ‘conditions’ impose ‘Absolute Restraint’ or ‘Enjoyment in a Particular Manner’. It does not invite Sec. 138 of the Indian Succession Act also, for the same reasons.
  4. Following decisions relied on in Mauleshwar Mani v. Jagdish Prasad, AIR 2002 SC 727 (and the subsequent decisions followed it) were not applicable in the fact-situation (that emerged) inasmuch as they dealt with independent earlier transfers; and not two parts of the same deed. The decisions are:
    1. Ramkishore lal v. Kamalnarayan, AIR 1963 SC 890 (Constitution Bench)
    2. Radha Sundar Dutta v. Mohd. Jahadur Rahim, AIR 1959 SC 24 (three judge bench)
  5. It is noteworthy that the Apex Court (in Mauleshwar Mani – in the matter of a Will) considered cases (Ramkishore lal and Radha Sundar Dutta) in which Sec. 11, TP Act is attracted- for Sec. 138 of the Indian Succession Act is pari materia to Sec. 11 of the TP Act.
  6. In KS  Palanisami v. Hindu Community Citizens of Gobichettipalayam, AIR 2017  SC 1473 (Ashok Bushan, J.) the joint Will executed by a couple created a Trust; but, it had been indicated that after the death of one of the spouse, the other (survivor) had Absolute right to deal with the property and there was no embargo on the right of survivor to dispose of the same.  Certain alienations were made by the wife after death of the husband. Our apex Court held as under:
    • “49. The intention in testamentary disposition has to be primarily found out from the actual words used in the Will. The court is not entitled to ignore clear words or add something of its own or dilute the meaning of any clear word used in the Will. The solemn duty of the court is to find out the intention of testator and thereafter to give effect to such intention.
    • 57. We, thus, are of the view that giving absolute right to the survivor during his lifetime to deal with the properties in no manner cannot be said to be right given in disregard of object of trust. The charitable purpose of the Will is not lost even if survivor is given absolute right.”

Why Ramkishore lal and Radha Sundar Dutta Do Not Apply

In Ramkishore lal v. Kamalnarayan, AIR 1963 SC 890 (Constitution Bench), dealt with the matter of a partition-award and the question arose was as to independent earlier dedication of property to a temple. It was held as under:

  • “We are inclined to agree with the contention of the learned Attorney-General that Mr. Bagchi’s award gives the property to Ramsaran Lal absolutely with only a charge on the property for the expenses of the temple and did not make an absolute dedication of the village to the temple. We are of opinion however that Mr. Bagchi’s award can have no legal effect in respect of the dedication already made. Once an absolute dedication of the property had been made in December 1896 in favour of Shri Ramchandra Swamy temple the former owners of the property had no legal authority to go behind that dedication.”

Similarly, in Radha Sundar Dutta v. Mohd. Jahadur Rahim, AIR 1959 SC 24 (three judge bench), considered was an independent earlier grant. It was held as under:

  • “But it is open to the parties to agree that the Chaukidari Chakaran lands should form a new and distinct Patni, and the result of such an agreement will be that while the grantee will hold those lands in Patni right, that is to say, the tenure will be permanent, heritable and alienable so far as his liability to pay jama and the corresponding right of the Zamindar to sell it under the Regulation if there is any default in the payment thereof are concerned, the now grant will be an entity by itself independent of the original Patni.”

‘Reconciliation of Apparent Inconsistent Provisions’ and ‘Repugnant Provisions’

As stated already, if only there is irreconcilable inconsistency between two provisions (as stated in the illustration of Sec. 88 – that is, in earlier clause, property was given to A; latter clause, to B – whereby a harmonious interpretation is not possible) then only the principle, ‘once granted cannot next be taken away‘ (or, the last of two inconsistent clauses prevails), be applied. It is emphasised by our Supreme Court (Constitution Bench consisting of BP Sinha (CJ), KC Das Gupta, PB Gajendragadkar, KN Wanchoo, JC Shah, JJ.) in  Ramkishore Lal v. Kamal Narain, AIR 1963 SC 890, as under:

  • “Sometimes it happens in the case of documents as regards disposition of properties, whether they are testamentary or non-testamentary instruments, that there is a clear conflict between what is said in one part of the document and in another. A familiar instance of this is where in an earlier part of the document some property is given absolutely to one person but later on, other directions about the same property are given which conflict with and take away from the absolute title given in the earlier portion. What is to be done where this happens? It is well settled that in case of such a conflict the earlier disposition of absolute title should prevail and the later directions of disposition should be disregarded as unsuccessful attempts to restrict the title already given (See: Sahebzada Mohd. Kamgar Shah v. Jagdish Chandra Deo Dhabal Deo, (1960) 3 SCR 604. It is clear, however, that an attempt should always be made to read the two parts of the document harmoniously, if possible. It is only when this is not possible, e.g, where an absolute title is given is in clear and unambiguous terms and the later provisions trench on the same, that the later provisions have to be held to be void.” (quoted in : H B Yeshwant Rao Ghorpade v. The Commissioner of Wealth Tax, Bangalore, AIR 1967 SC 135)

In Ramachandra Shenoy v. Mrs. Hilda Brite, AIR 1964 SC 1323, our Apex Court (N. Rajagopala Ayyangar, S.K. Das, A.K. Sarkar, JJ) observed with respect to a will as under:

  • 5. If the said Julia does not marry or if she has no issues, the said Julia should enjoy the said property up to her deathand thereafter this property of mine should be enjoyed by my eldest daughter, Severina obina Coelho and after her by her male descendants with permanent rights”.
  • “It is one of the cardinal principles of construction of wills that to the extent that it is legally possible effect should be given to every disposition contained in the will unless the law prevents effect being given to it. Of course, if there are two repugnant provisions conferring successive interest, if the first interest created is valid the subsequent interest cannot take effect but a Court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the will. It if for this reason that where there is a bequest to A even though it be in terms apparently absolute followed by a gift of the same to B absolutely “on” or “after” or “at” A’s death, A is prima facie held to take a life interest and B an interest in remainder, the apparently absolute interest of A being cut down to accommodate the interest created in favour of B.”

It is held in Navneet Lal alias Rangi v. Gokul, AIR 1976 SC 794, as under:

  • “It is one of the cardinal principles of construction of wills that to the extent that it is legally possible effect should be given to every disposition contained in the will unless the law prevents effect being given to it. Of course, if there are two repugnant provisions conferring successive interests, if the first interest created is valid the subsequent interest cannot take effect but a Court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the will.”

In K. S.  Palanisami v. Hindu Community Citizens of Gobichettipalayam, AIR 2017  SC 1473 (Ashok Bushan, J.), Palaniappa Chettiar and his wife by registered Will created a Trust. The Will indicated that after the death of one of the testators, the survivor had Absolute right to deal with the property and there was no embargo on the right of survivor to dispose of the same.  Certain alienations were made by Rangammal after death of Palaniappa Chettiar.  Relying on Navneet Lal alias Rangi v. Gokul, AIR 1976 SC 794 it is held that the solemn duty of the court is to find out the intention of testator and thereafter to give effect to such intention. The Court held as under:

  • “57. We, thus, are of the view that giving absolute right to the survivor during his lifetime to deal with the properties in no manner cannot be said to be right given in disregard of object of trust. The charitable purpose of the Will is not lost even if survivor is given absolute right. The obligation of survivor to act in furtherance of object as agreed by both the testators survives and binds the survivor. Although the Will was irrevocable after the death of survivor but the Will expressly granted absolute right to survivor.”

Followed in : Prabhakumari v. S.  Mohanarajan 2021-4 Ker HC 514

PART – 3

If only ‘Absolute‘ Bequest or Transfer, then only Adversities in S. 11 TP Act and S. 138 Succn. Act Attracted

‘Inconsistency’ and ‘absolute transfer’ are explained in Sec. 88 of the Indian Succession Act. First illustration reads as under:

  • “The testator by the first clause of his Will leaves his estate of Ramnagar “to A”, and by the last clause of his Will leaves to “to B and not to A”. B will have it.”

The law on this point is eruditely explained in Rajinder Singh Chowdhary v. Sardar Manjit Singh Chowdhary, AIR 2002 Del 135 (Vijender Jain, J.). The facts of the case, in a nutshell, are the following:

  • (a)  The father of the parties executed a Will bequeathing all his properties in favour of his wife ‘as the sole and absolute (in the sense, saleable) owner with full powers of disposal in any manner she likes’.
  • (b) The will further provided how the properties were to be distributed ‘in case she expires intestate and without disposing of the properties’.
  • (c) The mother died intestate.
  • It was contended by the plaintiff that the bequest to the mother was ‘absolute and anything which was repugnant to the absolute bequest was void and inconsequential under Section 138 of Indian Succession Act.
  • Plaintiffs relied on
    • Gopala Menon v. Sivaraman Nair, AIR 1979 SC 1345
    • Lalit Mohan Mondal v. Profulla Kumar Mondal, AIR 1982 Cal 52.
    • Shantilal babubhai v. Bai Chhani, AIR 1973 Gujarat 146,
  • The defendants contended that will had to be read as a whole and different parts of the will should be considered harmoniously. The defendants further contended that provision of Section 138 of the Act was not applicable to the present case and further contended that even if there was inconsistency, Section 88 of the Indian succession Act saves such inconsistency as the last clause prevails.  Section 88 of the Indian succession Act reads as under:  
  • “The last of two inconsistent clauses prevails. Where two clauses of gifts in a will are irreconcilable, so that they cannot possibly stand together, the last shall prevail.”
  • Defendants relied on following decisions:
    • Gopala Menon v. Sivaraman Nair, (1981) 3 SCC 586
    • Lt. Col. Kanwaljet Singh Chowdhary v. Chowdhary Harnam Singhand, 60 (1995) DLT 827.

Finally the court held as under:

  • “The principles enunciated in Gopala Menon s case (supra), Shantilal Babubhai (supra) and Lalit Mohan Mondal s case (supra) are well established principles that once a bequest has been made which is absolute and anything which is inconsistent would be repugnant and that has to be ignored.
  • But can it be said that the present case while interpreting the will at hand in view of the concern and anxiety of the testator with regard to his two sons and his intention to bequeath the property after the demise of Smt. Ved Kaur and words which are used signifying the concern and well being of aforesaid two sons are superfluous it is in this context court has to see as to whether bequest made in favour of Smt. Ved Kaur was absolute?
  • The answer is in the negative.
  • From the well laid down principle regarding interpretation of will and harmonious construction of the same, I hold that what was intended by the testator was to create a life estate in favour of Smt. Ved Kaur and not an absolute interest. The issue is answered accordingly.”

Theory of ‘Dominant Intention’

The will considered in Ramasreenivasa Iyengar v. Padmasani Ammal, (1973) 1 MLJ 34, provided that the two daughters of the testator should take the properties in equal shares with absolute (in the sense, saleable) rights, but the share of the lady without issues would, however, after her death, be taken by the daughter with issues along with her children. It was found that the testator intended only a life estate if no issue to anyone. It was held that the dominant intention was to preserve the estate to his grandchildren.

Deeds must be read as a whole

House of Lords (Lord Davey) in North-Eastern Railway Company v. Hastings, (1900) AC 260, held as under:

  • “The deed must be read as a whole in order to ascertain the true meaning of its several clauses, and the words of each clause should be so interpreted as to bring them into harmony with the other provisions of the deed if that interpretation does no violence to the meaning of which they are naturally susceptible.”

After quoting the House of Lords, our Supreme Court held in Provash Chandra Dalui v. Biswanath Banerjee, AIR 1989 SC 1834, as under:

  • “In construing a contract the Court must look at the words used in the contract unless they are such that one may suspect that they do not convey the intention correctly. If the words are clear, there is very little the Court can do about it. In the construction of a written instrument’ it is legitimate in order to ascertain the true meaning of the words used and if that be doubtful it is legitimate to have regard to the circumstances surrounding their creation and the subject matter to which it was designed and intended they should apply.”

After referring Namburi Basava Subrahmanyam v. Alapati Hymavathi, 1996 Ker HC 1200, and Kokilambal v. N. Raman. AIR 2005 SC 2468, it is observed in Nikhil v. Sarojini (2014-3 Ker LT SN 36) that there is no straight jacket formula to ascertain the nature of interest created and that each case depends upon the facts of that case and the deed that comes up for interpretation.

If onlyAbsolute Transfer’ or ‘Irreconcilable Inconsistency’, the doctrine ‘once granted cannot be taken away’, applied

Same principles as to ‘irreconcilable inconsistency’ apply to ‘absolute’ transfer, when the doctrine, ‘once granted cannot next be taken away’, is applied.

The Supreme Court has explained in Sahebzeda Mohammad Kamgarh Singh v. Jagdish Chandra Deo Dhabal Deb, AIR 1960 SC 953, that if only there is irreconcilable inconsistency between two provisions (as stated in the illustration of Sec. 88 – that is, in earlier clause, property was given to A; latter clause, to B – whereby a harmonious interpretation is not possible) then only the principle, ‘once granted cannot next be taken away‘, be applied.

  • “The task being to ascertain the intention of the parties, the cases have laid down that that intention has to be gathered by the words used by the parties themselves. In doing so the parties must be presumed to have used the words in their strict grammatical sense. If and when the parties have first expressed themselves in one way and then go on saying something, which is irreconcilable with what has gone before, the courts have evolved the principle on the theory that what once had been granted cannot next be taken away, that the clear disposition by an earlier clause will not be allowed to be out down by later clause. Where there is ambiguity it is the duty of the Court to look at all the parts of the document to ascertain what was really intended by the parties. But even here the rule has to be borne in mind that the document being the grantor’s document it has to be interpreted strictly against him and in favour of the grantee.”

PART – 4

Absolute‘ Transfer with stipulation: ‘if property remains’ on death of transferee, it will go to another – If Valid?

Yes.

Following important points gain consideration in this regard:

  1. In Indian practice, though the words used in the deeds might be ‘absolute transfer’, on a true construction, on a reading of entire document, it might only be a salable/transferable right during life time; and the left-over property might be given to another.
  2. The common law in India requires reading the whole document altogether, and give effect to the document on a harmonious interpretation, rather than giving effect to the legal terms used in a deed.
  3. Illustrations in Sections 24 and 27 make it clear that Indian law recognises ‘vested remainder’ and ‘contingent remainder‘ (as detailed in the notes above).
  4. It is also beyond doubt that such a transfer is not hit by Sec. 10 and 11 of the TP Act; inasmuch as Sec. 10 and 11 cumber only when ‘conditions’ impose ‘Absolute Restraint’ or ‘Enjoyment in a Particular Manner’.
  5. First illustration in Sec. 88 of the Indian Succession Act reads as under:
    • “The testator by the first clause of his Will leaves his estate of Ramnagar “to A”, and by the last clause of his Will leaves to “to B and not to A”. B will have it.”

Various court decisions make it clear that one can validly transfer or bequeath a property to another, with absolute (in the sense, saleable) rights, with the stipulation that after that (first) transferee’s lifetime, if whole or any part remains, it (contingent remainder) may go to another.

In K. S.  Palanisami v. Hindu Community Citizens of Gobichettipalayam, AIR 2017  SC 1473 (Ashok Bushan, J.), Palaniappa Chettiar and his wife by registered Will created a Trust. The Will indicated that after the death of one of the testators, the survivor had Absolute right to deal with the property and there was no embargo on the right of survivor to dispose of the same.  Certain alienations were made by Rangammal after death of Palaniappa Chettiar.  It is held as under:

  • “49. The intention in testamentary disposition has to be primarily found out from the actual words used in the Will. The court is not entitled to ignore clear words or add something of its own or dilute the meaning of any clear word used in the Will. The solemn duty of the court is to find out the intention of testator and thereafter to give effect to such intention. On the reading of the Will, the intendment of testator/testatrix is clear that survivor shall have absolute right of enjoyment of properties. There is no reason not to give effect to said intendment on the ground that the testator and testatrix have mutually intended to set apart the property for charity and holding that survivor shall have right of disposition be not in the interest of the trust.”

Other Erudite Decisions on the Topic

In Sanford v. Sanford, (1901) 1 Ch. 939, the gift to the wife conferred a power of disposal limited explicitly to her lifetime. But, the gift-over to son was of a quite absolute estate. The gift did not include a power of disposition by will, but allowed power of disposition inter vivos. It was provided in the gift deed that if any property remained at her death it was to pass ‘from father to son, from generation to generation’.   Therefore, it was held that the widow was conferred with only a limited right; and the gift-over, which was ‘the will of the testator’ was to ‘settle its destination’. (This decision is referred to in Nataraja Mudaliar v. Panduranga Mudaliar, 1976-2 MLJ 381.)

In Nataraja Mudaliar v. Panduranga Mudaliar, (1976) 2 MLJ 381, the Madras High Court rendered a well-read decision in this topic. The facts of this case, in a nutshell, are as under:

  • (i) The settlement deed considered in the case provided:
  • (a)  the wife of the settlor should enjoy the properties with absolute (in the sense, saleable) rights.
  • (b) the respondent should take the properties remained at the time of her death, with absolute rights.
  • (ii) the appellant contended that the clause providing for the respondent taking absolutely such of the properties as at the time of the death of the settler’s wife was repugnant to the earlier clause conferring an absolute estate on her, and has, therefore, to be ignored as void.
  • (iii) the respondent contended that if the settlement deed had to be read as a whole  and the effect would be:
    • there was no absolute transfer to the wife of the settler as stated in Sec. 11 of the TP Act.

It is seen that the High Court accepted the contentions of the respondent that the settlement deed was to be read as a whole and that the respondent had taken absolutely such of the properties covered by the settlement deed as remained undisposed of by the settlee, the wife of the settlor; as she had only a right to enjoy the properties with absolute (in the sense, saleable) powers of disposal during her lifetime. The clause as to acquiring property by respondent was not repugnant and void.

The High Court relied on the following cases. The facts of these were ‘very near’ to the facts of that case.

  • Thayalai Achi v. Kannammal, AIR 1935 Mad 704,
  • S.M. Hara Kumari v. Mohim Chandra Sarkar, (1908) 12 CWN 412,
  • Anantnasayana v. Kondappe AIR 1940 Mad 479,
  • Lakshmi Ammal v. Allauddin Sahib, AIR 1962 Mad 247,
  • Ramasreenivasa Iyengar v. Padmasani Ammal, (1973) 1 MLJ 34.

In Lakshmi Ammal v. Allauddin Sahib, AIR 1962 Mad 247, it was held, as regards a Will, as under:

  • “After giving an absolute estate to his wife over the two items of scheduled properties, he provided that these scheduled properties, after the wife’s lifetime should devolve – item 1 on the first daughter and item 2 on the second daughter – who would have absolute rights. When the testator took care to indicate that the properties without any distinction even after his wife’s lifetime should go to each of the daughters, it should be presumed that it was clearly in his mind that the wife’s estate was only to be a limited estate or life estate, and not an absolute one.” (Quoted in: Nataraja Mudaliar v. Panduranga Mudaliar, (1976) 2 MLJ 381).


Read in this Cluster:

Civil Procedure Code

Power of attorney

Title, ownership and Possession

Principles and Procedure

Land Laws

Evidence Act – General

Contract Act

Easement

Stamp Act

Will

Book No. 2: A Handbook on Constitutional Issues

Book No. 3: Common Law of CLUBS and SOCIETIES in India

Book No. 4: Common Law of TRUSTS in India

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