1. The decision of this Rule turns upon an interesting pointof law, involved in the question whether or not the third defendant was liablefor the debt due to the plaintiff from the first two defendants. It appearsthat the first two defendants borrowed a sum of money from the plaintiff on a promissorynote executed on the 6th January 1913 They transferred their properties to thethird defendant on the 31st January 1913 and on that very date the thirddefendant executed an agreement in favour of his vendors expressly undertakingto pay to the plaintiff his dues out of the consideration money retained in hishands. The plaintiff instituted this suit on the 4th January 1916 against hisdebtors as also the third defendant. The Small Cause Court Judge has degreedthe suit against all the defendants.

2. On behalf of the third defendant it is urged in thisCourt that there was an interpolation in the deed of agreement executed by himand that in fact the recital as to the debt due to the plaintiff from the firsttwo defendants was inserted. With out his knowledge after the execution butbefore the registration of the document. This defence has not been believed bythe Court below and upon the findings of the Small Cause Court Judge it isimpossible for us to examine this question of fact. We most consequentlyproceed on the assumption that the third defendant did undertake to pay theplaintiff his dues out of the consideration money in his hands. The questionis, whether the plaintiff is entitled to enforce the agreement made between thethird defendant and his vendors.

3. On behalf of the plaintiff reliance is placed upon thedecision in Deb Naiain Duttv. OhuniLnl Ghose(Ram Sadhan Handed) 20 Ind. Cas.630 : 41 C. 137 : 17 C.W.N. 1143 : 18 C.L.J. 603, which is an authority for theproposition that the rule enunciated in Tmeddle v. Atkin-son (1861)1 B. &S. 393 : 30 L.J.Q. B. 265 : 8 Jur. (N.S.) 332 : 4 L.T. 468 : 9 W.R. 781 : 121E.R. 762 : 124 R.R. 610, is not applicable in this country and that anagreement may in certain circumstances be enforced by a stranger thereto thatis in what may be briefly described as cases of trust, quasi-contract, or nearrelationship see Jahandar Bakah Malliok v. Ram Lal Hazra 5 Ind. Cas. 565 [LQ/CalHC/1910/71] : 11C.L.J. 364 : 14 C.W.N. 470 : 37 C. 449, The third defendant however seeks todistinguish that case on the ground that there the arrangement between thedebtor transferor and the transferee was communicated to the creditor whereasthere is nothing to show that in the present case the arrangement between thefirst two defendants and the third defendant was ever brought to the notice ofthe plaintiffs by either of them. In our opinion the distinction mentioned isnot material and the principle which under-lies the decision in Deb Narain Duttv. Chuni Lal Ghose : Ram Sadhan Mandal 20 Ind. Cas. 630 [LQ/CalHC/1913/346] : 41 C. 137 : 17 C.W.N.1143 : 18 C.L.J. 603, applies equally to the present case. In that case therewas a contention that the plaintiff was entitled to succeed on the ground ofnovation of contract, and from this point of view, stress was laid upon thefact that the arrangement between the transferor and transferee had beencommunicated to the creditor. This Court, however, held that notwithstandingsuch communication there was no novation of contract and that the suit must bedeemed to have been instituted on the original debt. That this is the true viewof the situation is clear from the decision in Gregory v. Williams (1817) 3Mer. 582 : 17 R.R. 136 : Preface V : 36 E.R. 224, which was quoted withapproval and followed in Deb Narain v. cliuni Lil Ghose : Rim Saihnn Mandal 20Ind. Cas. 630 : 41 C. 137 : 17 C.W.N. 1143 : 18 C.L.J. 603, The circumstancesin that litigation were as nearly as possible, identical with those of the caseby fore us There P transferred his properties To W who It May Concern:, whoretained the consideration money in his hands and agreed to apply the sum insatisfaction of a debt due to G from P and to appropriate the balance only insatisfaction of his own dues.

4. The arrangement was intended to be communicated to G, buyas a matter of fact was not brought to his notice. IF on the other hand,communicated to G an untrue version of what had happened and as the report saysit was by a mere accident that G came to know of the arrangement between P andW.G along with instituted a suit to recover the debt from V. The claim wasresisted on the ground that the consideration had not moved from G, who was astranger to the agreement between P and W and was entitled to, no benefit theunder. Sir William Grant, M.R., overruled this contention he conceded that theaction might not have been maintainable in a Court of Law, because theengagement was made to P and not directly to G and the consideration wasfurnished by P. But he proceeded to hold that although, no party to the contracthad an equitable right through the mediation F the agreement to P, as shown bya decision of Lord Hardwicke to the same effect. There had been nocommunication of the agreement between P and W to G, and no sum communicationwas necessary because the claim was not based on novation of contract on theallegation that by mutual arrangement of all the parties, a new agreement asbetween IV and had been substituted in supersession of the original agreementbetween P and G, The decision was based on the ground that W was in essence atrustee of the money in his hands for the benefit of G, who could clearlyenforce it whether or not the arrangement had been communicated to him by P orW.

5. We must hold, consequently, upon principle as also uponauthority that the plaintiff is entitled to enforce his claim as against thethird defendant The Rule is discharged with costs one gold mohur.

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Dwarka Nath Ash vs.Priya Nath Malki and Ors. (28.08.1916 -CALHC)