Discuss the doctrine of lis pendens and give its basis. Does the doctrine apply to an execution proceeding? Elucidate.

Question: Discuss the doctrine of lis pendens and give its basis. Does the doctrine apply to an execution proceeding? Elucidate. [JJS 2018]

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Answer

Section 52 of the Transfer of Property Act, 1882 finds its roots in the age-old doctrine of 'Lis Pendens' which literally translates to 'pending litigation'. This doctrine is based on the common law principle of "ut lite pendente nihil innovetur" which means 'during the pendency of litigation, nothing new interest should be introduced or created in respect of the property'.

The emergence of the doctrine of lis pendens can be traced back to the matter of Rajendra Singh and Ors. v. Santa Singh and Ors.,1973 AIR 2537 which provides its definition as under:-

“Lis-pendens means a pending suit and the doctrine of lis-pendens has been defined as the jurisdiction, power, or control which a Court acquires over property involved in a suit pending the continuance of the action, and until final judgment therein.”

This reasoning was further reiterated by the apex court in Jayaram Mudaliar v. Ayyaswami and Ors., AIR 1973 SC 569.

Furthermore, through judicial pronouncements, two theories of this doctrine have emerged. First is the 'Theory of Notice' and the 'Theory of Necessity'; which have been formulated by jurists to construe the basis of this doctrine.

The former theory words that pending litigation will serve as a constructive notice of dispute being pending on the said immovable property to everyone. Thus, it could be considered as a warning to third parties against buying the said property. Alternatively, the latter theory suggests that for fair adjudication, it is imperative to bind the litigants from alienating the property during the pending suit to ensure that there is no interference with the execution of the court's decree.

This clarification has been properly proffered in the case of Bellamy v. Sabine, (1857) I D&J566, where it was proffered as

"If parties to a dispute aren't prevented from transferring any of the property, then it would be impossible for any action/suit to be successfully terminated.”

Thus, the foundation for this doctrine doesn't rest upon constructive notice; it rests entirely upon necessity, where the party to litigation shouldn't alienate the property to affect the opponent. Based on expediency and the necessity for final adjudication, this view has been consolidated in the case of Faiyaz Husain Khan v. Munshi Prag Narain, (1907) 9 BOMLR 656.

The acceptance and recognition of the notion of notice and the 'Theory of Necessity' are deeply rooted in considerations of public policy, specifically to safeguard the rights of plaintiffs. Without these principles, plaintiffs would be vulnerable to defendants who could repeatedly transfer the title of immovable property before a judgment is reached. If the plaintiff succeeds in court, they would find themselves trapped in a cycle of filing multiple suits to obtain possession of the property. This situation would not only be impractical but also undermine the principle of res judicata, as Lis Pendens is often viewed as an extension of this legal doctrine.

Does the doctrine of lis pendens apply to an execution proceeding?

Order XXI Rule 102 of Code of Civil Procedure - Rules not applicable to transferee pendent lite

“Nothing in rules 98 and 100 shall apply to resistance or obstruction in execution of a decree for the possession of immovable property by a person to whom the judgment-debtor has transferred the property after the institution of the suit in which the decree was passed or to the dispossession of any such person.”

Recently in the case of Jini Dhanrajgir & Anr. v. Shibu Mathew & Anr., (2023), the Hon’ble Supreme Court held that for applicability of Rule 102 Order XXI of the Civil Procedure Code, 1908 (“CPC”), the Executing Court would have to determine upon evidence whether the transfer of immovable property which was made post dismissal of suit, was made after institution of appeal/further litigation or not to attract the principle of lis pendens.

In this case, a suit for declaration of title was filed by the Plaintiff and the same was dismissed. Post dismissal, the Defendant transferred the Suit Property to third parties. However, the Plaintiff went to appeal and the suit was restored and eventually decreed in her favour. In execution proceedings, the third parties filed objections claiming their right over the Suit Property. The plaintiff took shelter of Rule 102 Order XXI of CPC and claimed that the transfer of suit property made during the pendency of litigation confers no right upon such transferee.

The Bench observed that Section 47 of CPC confers exclusive jurisdiction on the Executing Court to prevent unnecessary litigation and to achieve speedy disposal of the questions arising about the execution, discharge or satisfaction of the decree.

On the issue of applicability of Rule 102 Order XXI of CPC, the Bench held that the executing court would have to determine based upon evidence whether the transfer of suit property was made post dismissal of suit, when no litigation was pending, or otherwise. It has been held as under:

“If, indeed, there have been transfers post dismissal of the Suit when there was no pending lis, it would be most appropriate for the Executing Court to determine the question as to whether any of the transfers made by Mr Mathew to the Respondents would attract Rule 102.

This would indeed involve an exercise of leading of evidence by the parties and merely because the Suit was ultimately decreed on 21st October 2000 and ultimately was upheld by this Court with a minor modification of the amount of compensation, that would not be sufficient justification to throw out the objections raised by the Respondents as being devoid of merit.”