Bijai Singh v Sarbdawan Singh (1914)

A mortgage may fix a long term before redemption, and Indian courts had often enforced long terms. This case draws the line between a merely long term and a term plus a device that makes redemption practically impossible. Giving the mortgagor one day in eighty years to redeem, on pain of a fresh forty-year term, was held oppressive and not enforced. It is regularly used alongside the Privy Council's later clog cases.

On 4 February 1871 the father of the respondent Bijai Singh made a usufructuary mortgage in favour of Ram Din Singh, father of the four appellants. The mortgage "was for a term of forty years and was to be redeemed on the day following the completion of that term". If the mortgagor failed to redeem on that day "the mortgage was to hold good for a second term of forty years." The deed also provided "that the mortgagor should not be entitled to redeem the mortgage with borrowed money."

The mortgage money was paid into court under s. 83 of the Transfer of Property Act on 10 June 1911; the mortgagees refused it. The redemption suit was filed in September 1911. The mortgagees pleaded that redemption could be claimed only on the day following the forty-year term. The Subordinate Judge agreed and dismissed the suit. The District Judge held that the deed did not fix the redemption day with certainty and that the second forty-year term was penal, and decreed redemption. The mortgagees appealed.

The High Court noted that the date on the deed was given only in the Sambat and Fasli reckoning; by those the day for redemption would fall on one date, by the British calendar on another. The deed, written in the Nagri character by what seemed to be a village writer, did not show which the parties meant.

1. Did the deed fix the day for redemption with certainty?
2. Even if it did, was the provision allowing redemption on a single day, failing which the mortgage ran for a further forty years, an invalid clog on the equity of redemption?

The appeal was dismissed with costs; the District Judge's decree for redemption stood.

On the first issue the Court said: "We are unable to say that the deed indicates with certainty the date on which redemption might be effected."

But even assuming a day was fixed, the Court held the provision was designed to prevent redemption, or at least to hamper the mortgagor so as to make redemption almost impossible, and that equity will not permit a device calculated to prevent or impede redemption.

Long terms distinguished

The Court was sceptical of long postponements generally: "The English Courts have shown a strong disinclination to uphold provisions restraining redemption for long periods, and we doubt whether they would approve some of the Indian decisions on this question." It also doubted the reason sometimes given for upholding them — that the Limitation Act allows a long period for redemption suits. The decisive distinction was this: "cases in which the parties have merely agreed to fix a very long term for a mortgage are not to be compared with a case in which a very long term has been fixed and a provision has been inserted in the deed which makes redemption very difficult, if not impossible, at the end of that term."

The Court accepted as reasonable the old practice of allowing redemption only in the month of Jeth, when the crops are off the ground. "But to give a man one day only in eighty years on which he may redeem is to make difficulties for him far greater" than in those cases. An earlier Allahabad decision enforcing a second thirteen-year term (Rambaran Singh v Ramker Singh) was distinguished: the consequences of missing the day there were much less serious, and s. 83 of the Transfer of Property Act had already been passed when that mortgage was made, but not when this one was.

The test

"The decision in each case must depend upon its own circumstances." Here the Court found the redemption provision was designed to make redemption very difficult, if not impossible. The ban on redeeming with borrowed money confirmed the purpose: "The stipulation that the mortgage should not be redeemed with borrowed money, which is admittedly invalid, shows that the mortgagee intended to place every obstacle in the way of redemption."

"The provision that redemption may take place on one day only in the course of eighty years is most oppressive." Illness of the mortgagor, absence of the mortgagee, or uncertainty after a death about who was entitled could each defeat redemption on that day. "The shorter the time during which the money is to be paid the more difficult does redemption become." It was even conceded in argument that a window of two or three hours on one day should not be enforced. "In our opinion the lower appellate court was right in refusing to enforce the provision for redemption in this case."

A court will not enforce a provision in a mortgage that, on its own circumstances, is designed to prevent or make practically impossible the mortgagor's redemption. A merely long term is different; but a long term coupled with a single day for redemption, on failure of which the mortgage runs for another long term, is an oppressive fetter on the equity of redemption and will not be enforced. There is no hard and fast rule; each case turns on its facts.

• Can a mortgage validly postpone redemption for a long period? When does postponement become a clog? Contrast a long term simpliciter with a long term plus a device that makes redemption practically impossible; quote the "one day only in eighty years" passage.
• Is a covenant not to redeem with borrowed money valid? The Court treated it as admittedly invalid and as evidence of an intention to obstruct redemption.
• Say clearly that this is an Allahabad High Court decision. It is cited in Rajai Singh v Randhir Singh (1925), another Allahabad High Court case on the same theme.