Legal Guide

3 Most Important Landmark Cases on Transfer of Property Act

by Saket Sharan · 4 min read

landmark cases on transfer of property act

Introduction

The Transfer of property act, 1882 states in its preamble that it aims to define and amend laws relating to the Transfer of property. It does so not by operation of law but rather by the ct of the parties.

Transfer of property act is a civil law and codifies substantive rights. The act is also not exhaustive in nature, meaning it does not cover the entire dimension of the Transfer of property. As such, it being a substantive law, there are a lot of relevant cases regarding the Transfer of property, so in the interest of time, we’ll take a look at the most important landmark cases on the Transfer of Property Act.

Landmark Cases on Transfer of Property Act:-

  1. Rusher v. Rosher
  • Related to – Section 10, TPA
  • Doctrine – Rule Against Alienability
  • Section 10 of the Transfer of Property Act: 

Condition Restraining Alienation – “Where property is transferred subject to a condition or limitation absolutely restraining the transferee or any person claiming under him from parting with or disposing of his interest in the property, the condition or limitation is void

Facts of the case 

  • In this case, a testator devised an estate for his son (or his heirs) subject to a condition that if he should desire to sell the estate, during the lifetime of the testator’s wife, she would be given an option to purchase the estate for £300 for the whole and at a proportionate price for any part thereof. 
  • The value of the property at the date of the will was £15,000. Thus, she had an option to purchase the property at one-fifth of its value.
  • The will also provided that if the son or any of his heirs wanted to let the estate on rent, they could do so freely only for three years. 
  • After the expiration of that period, the widow would have the option to occupy the premises, for the period in excess of three years, at a fixed nominal rent. 
  • If the tenancy exceeded seven years, again, she was entitled to occupy the property for a fixed rent. 
  • The son or his heirs were under an obligation, therefore, to offer the premises to the widow first, and only when she declined to take it could they let it out to other persons.

Court’s Observations:-

  • The court observed that the test to determine whether a restraint is absolute or only partial depends upon the effect and not on the form of words laying down the condition. 
  • If the effect is absolute, it would be struck off as bad howsoever clear language may have been used. 
  • Thus, in this case, it was held that a condition to sell the property at 1/5th of its value even to a limited period was an absolute restraint during that period and is hence void. The throwing away at 1/5th value (irrespective of whatever might have been its market value) is equivalent to a restraint upon selling at all (i.e., ‘during the lifetime of the widow, you, shall not sell’). Hence it became one of the landmark cases on the Transfer of property act.
  1. Cooper v Cooper
  • Related to – Section 35 of the TPA 1882
  • Section 35 – (Explained) Where an individual person professes to transfer the property which he has no right to transfer and as a neighborhood of an identical transaction, it confers any benefit on the owner of the property, and such an owner must elect either to verify such Transfer. Or to dissent from it, and within the latter case, he should relinquish benefit so conferred. Thus the benefit is renounced in a way that it reverts to the transferor or his representative as if it had not been disposed of.

Facts of Case

  • Vera and Harold Cooper were married in 1933. They had two children. Due to legal separation, there was a settlement: agreement, and through this agreement, Vera took the family home and automobile, and Harold took tools and shop equipment.
  • With the name, Harold four policies were there, and Vera was the beneficiary of all those policies. Subsequently, the decree of divorce was granted by the court.
  • Then Vera married one Alves, and Harold married Ida. After Harold’s remarriage, he changed the beneficiary of the three equitable policies from Vera to Ida. One of the policy, which was left signed by Vera but was not signed by Harold. Then subsequently, Harold died.
  • The main question before the court in this landmark case on the Transfer of property act was whether Vera and his children have a vested interest in the property?

Judgment

  • Vera had no interest within the policies at the date of Harold’s death because Harold’s obligation for her support and under the terms of the divorce decree, terminated upon her remarriage which the interest of the youngsters within the estate of their father is restricted to the quantity necessary for his or her support measured by the provisions of the divorce decree before reaching their majority. 
  • Hence it became one of the landmark cases on the Transfer of property act.
  1. Bellamy v. Sabine
  • Related to – Section 52, TPA
  • Doctrine discussed – It is one of the landmark cases on the Transfer of property act that gave birth to the Doctrine of Lis Pendens.

Doctrine Explained – The doctrine of lis pendens is expressed in the well-known maxim, ‘pendente lite nihil innovature,’ which means during the pendency of any suit regarding the title of a property, any new interest in respect of that property should not be created. 

 The effect of the applicability of the doctrine is that it does not annul the conveyance but only renders it subservient to the rights of the parties to the litigation. The transferee will be bound by the result of the suit or proceeding, whether or not he had notice of the suit or proceeding.

Facts of the case

  • There was a person named Mr. H who sold an immovable property to Mr. B.
  • Now Mr. H’s son, Mr. P, who was the heir of Mr. H, sued Mr. B to have the sale declared to be void.
  • However, while this litigation was pending, Mr. B sold the property to Mr. C, who did not take notice of the suit.
  • The Court held that the son Mr. H was entitled to the property, and the sale was set aside.
  • Mr. C, who purchased the property from Mr. B, does not get any title as he purchased the property from someone who did not have the title and therefore cannot convey it.
  • Hence it became one of the landmark cases on the Transfer of property act.

Court’s observation

The doctrine of lis pendens has its origin in this case, wherein Turner, L.J., observed that “The doctrine of lis pendens was a doctrine common to the courts of law as well as equity since it would become almost impossible for the suit that is instituted in a court, to be adjudicated if alienations pendente lite were allowed to prevail. The plaintiff, in such a situation, would be liable to be defeated by the defendants causing the alienation before the judgment is passed, every time, and would be driven to institute a new course of proceedings, every time.”

Conclusion

It is highly evident as we read these Landmark Cases on Transfer of Property Act that it’s a multi-dimensional concept, and it varies according to unique situations that we are faced with in daily life.

It has gone through various amendment processes and is bound to evolve more, considering it is not exhaustive. Suffice to say, it has proved its resilience and effectiveness with changing times and will continue to do so. 

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Saket Sharan

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Saket Sharan

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