Sir Madhavan Nair - (1.)This is an appeal from a decree of the High Court of Judicature at Lahore dated 16 May 1941, which affirmed a decree of the Court of the Subordinate Judge, First Class, Montgomery, dated 29 May 1939, and dismissed the plaintiffs' suit. The appeal arises out of a suit instituted by the plaintiff's-appellants before the Board -for setting aside the sale and for possession of the properties mentioned in the plaint which were sold by Court in execution of a decree, by reason of a surety bond executed by their father Uttam Chand in the circumstances mentioned below. The properties in dispute have been found to be ancestral. The main question arising for decision in this appeal is whether the above-mentioned surety bond creates or gives rise to a personal liability on Uttam Chand.
(2.)Uttam Chand and Dogar Chand, shown in the pedigree given below, were two separated Hindu brothers. Kesar Chand and Ram Lal -appellants 1 and 2-are the sons of Uttam Chand; Chand Kishan-appellant 3-is the son of Kesar Chand and grandson of Uttam Chand. Uttam Chand and the three appellants constituted a joint Hindu family. Dogar Chand died leaving a widow, and three minor sons, Hans Raj, Sohan Lal, and Des Raj. On 1 July 1927, respondent 2, Nand Lal, obtained a preliminary mortgage decree against the minor sons of Dogar Chand, represented by their guardian Uttam Chand, on the basis of a mortgage executed by their mother, for Rs. 7748, with interest and costs. This decree was made final on 21 January 1928. Hans Raj and his brothers through their guardian appealed to the High Court against the decree, and prayed for a stay of the execution of the proceedings which had been taken by the decree-holder. The stay asked for was granted by Coldstream J. who passed the following order on 11 May 1928. : "Mr. Anant Ram [Counsel for Nand Lal] asks that his clients may in any case be secured by a charge upon immovable property against loss if the sale is stayed. I think this is a reasonable argument and, having in view all the circumstances, I order that the property be not sold if the petitioners can furnish security in the form of a charge upon immovable property to the satisfaction of the executing Court for paying to the decree-holder in the event of the failure of their appeal, the amount by which the price fetched by the mortgaged property when sold under the decree falls short of the amount then found due to the decree-bolder under the provisions of the final decree . . . ."
(3.)Thereupon Uttam Chand executed a security bond on 3l July, 1928, in the following form, after stating that the High Court, had called upon him to file a security bond to the effect that if the decree money and costs, etc., are not recovered in full from the land he would be liable to make good the deficiency: "Hence I hereby stand as surety for Hans Raj and others, minors, judgment-debtors, and agree that in the event of the appellate Court's decision being against the judgment-debtors, my moveable and immovable properties, detailed hereinafter, shall be liable for making good the deficiency, if the sale proceeds of the hypothecated property are not sufficient to meet the demand, i. e., the amount which may then be found due from the judgment-debtors according to the decision." The above statement is followed by a list of some items of moveable property, though their security was not called for, and three items of immovable property. The appeal before the High Court was compromised, and the Court passed a mortgage decree in terms of the compromise, providing that the property should remain under attachment and that "the security furnished by the surety shall also stand."