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TO ANALYZE AND STUDY THE DIFFERENCE BETWEEN

CONTINGENT INTEREST AND SPES SUCCESSIONIS UNDER THE


TRANSFER OF PROPERTY ACT, 1882.

B.B.A.LLB(HONS.)/ FIFTH SEMESTER

RESEARCH PAPER

SUBMITTED TO:

PROF. EKTA SAINI


SCHOOL OF LAW, NMIMS

SUBMITTED BY:
TARANG SARAOGI
ROLL NO. B039
SAP ID: 81021018041

SUBMITTED ON: 14th September, 2020


1. INTRODUCTION:

The Transfer of Property Act deals with two kinds of interest vested interest and contingent
interest. Vested interest is to be distinguished from contingent interest. When an interest is
vested, the transfer is complete but when the interest is contingent, the transfer depends upon a
condition precedent. When the condition is fulfilled the transfer takes effect and that the interest
becomes vested. Section 21 of The Transfer of Property defines Contingent interest1.

Contingency means uncertain future event. In a transfer of property where the vesting of interest
depends on any contingency i.e. uncertain future event, the interests is contingent. In a transfer of
property where the vesting of estate is dependent upon an event that may or may not happen the
interest is contingent2.

A contingent interest is an interest which is created to take effect only when

i. Some specified uncertain future event happens or


ii. Specified uncertain future event does not happen.

These conditions can be of further divided into:

i. Condition precedent i.e. they have to be observed first and then only the transfer can take
place.
ii. Condition subsequent i.e., the transfer takes place first and the conditions have to be
observed by the transferee at the later stage and if he does not comply with the
conditions, then the transfer becomes void.
iii. Collateral condition

1.1 UNDERSTANDING SPEC SUCCESSIONIS AND CONITNGENT CONTRACT.

1
Where, on a transfer of property, an interest therein is created in favour of a person to take effect only on the
happening of a specified uncertain event, or if a specified uncertain event shall not happen, such person thereby
acquires a contingent interest in the property. Such interest becomes a vested interest, in the former case, on the
happening of the event, in the latter, when the happening of the event becomes impossible.

2
Chinna Reddy v. Pujari Keshanna, AIR 1954 Hyd. 185
Spes Successionis is mentioned in section 6 of the Transfer of Property Act, 1882. It states that,
property of any kind may be transferred except as otherwise provided by this Act or by any other
law for the time being in force3–

1. The possibility of an heir apparent succeeding to an estate.


2. The chance of a relation obtaining a legacy on the death of a kinsman
3. Any other mere possibility of a like nature cannot be transferred.

The possibilities referred to in this clause are bare possibilities and not possibilities coupled with
an interest such as contingent remainders and future interest. With reference to contingent
interest, it is something quite different from the mere possibility of the similar nature of an heir
seemingly succeeding in inheritance, or the possibility of a relationship gaining a legacy and also
something quite different from the mere right to sue. It is a well-proven form of property. It
certainly has been transferred in this country for generations in respect of which it is quite
possible to raise money and to dispose of it in any way the beneficiary chooses.

Whereas, in a transfer of property, if an interest is created in favour of a person to take effect


only in the case of happening of specific uncertain event, or if a specific uncertain event will not
happen, then, that person acquires a contingent interest in the property 4. There are exceptions to
the same which are as follows:

Exception – Under transfer of property, a person becomes entitled to an interest upon attaining a
particular age, and the transferor also gives to him absolutely the income to arise from such
interest before he reaches that age, or directs the income or so much thereof as many be
necessary to be applied for his benefit, such interest is not contingent 5. This means that when the
transfer of property is supposed to happen only on the happening of specified uncertain event,
then the person to whom the transfer is to be made is said to have the contingent interest in that
property, meaning which the interest arises only on the happening of the specified uncertain
event which means the event on the happening of which the property is to be transferred, is
specified and is uncertain. Therefore, when for instance a person A is said to transfer his property
to B only on his demise, then the happening of A’s death is uncertain but is specified so the
3
Section 6, The Transfer of Property Act,1882.
4
Section 21, The Transfer of Property Act, 1882.
5
Ibid.
interest of B therein becomes the Contingent Interest. The exception to this is that when the
person becomes entitled to the interest of attaining that property at a particular age, but even
before that age the transferor is giving him the benefits arising out of his land, the interest may
not be considered as a contingent interest.

For instance, in the above mentioned example we saw that A was to transfer his property to B
only on his death, but if A does transfer his property before his death, then the interest of B in the
property is not contingent anymore. If the transfer is subject to a condition precedent, there is no
transfer at all until the condition is fulfilled. Till then the interest is contingent on the condition
being fulfilled. When the condition is fulfilled, the transfer takes effect and the interest becomes
vested6. The specified uncertain event may be one which depends upon the will of the intended
transferee, e.g. execution of a deed, or payment of a sum of a money. The performance of such
condition is subject to section 26 of the Act7.

2. RESEARHCH METHODOLOGY:

For the purpose of this research paper the researcher will mainly focus on analyzing and studying
the various differences between contingent interest and Spes Successionist under the Transfer of
Property Act, 1882 as normally they are considered same due to their similar features. The
researcher has undertaken both exploratory and explanatory form of research to add quality to
the research and understand the concept in greater detail. The present research paper seeks to
answer varied questions like what is a contingent interest in a immoveable property and the
nature of spec successionis under the Transfer of property Act, the similarities arising between
them and how they are both mutually exclusive concepts under the Act, among other things.

2.1 AIMS AND OBJECTIVE

6
Cheena Reddy v. Pajau Kesamma, A.I.R. Hyd, 1954, 185.
7
Section 26, The Transfer of Property Act, 1882.
The researcher has studied the concept of contingent interest and spec successionis in detail with
the help of case laws and evaluated fundamental differences arising between them. In view of the
above, the basic objectives of the study planned are given below. The following are the main
objectives of the present study:

 To study contingent interest under the Transfer of Property Act, 1882.


 To study spec successionis under the Transfer of Property Act, 1882.
 To understand the differences between spec successionis and contingent contract Transfer of
Property Act, 1882.

2.2 SCOPE AND LIMITATION

The present research paper essentially covers section 6 and section 21 of the Transfer of Property
Act, 1882. The research paper makes an attempt to understand contingent interest in a property
and the nature of spec successionis under the Act in detail with the help of various case laws and
judgements. The paper mainly contends around understanding the fundamental difference
between the two as both are regarding future possible interests but where spec successionis is
non- transfereable, contingent interest can be transferred. It is seen that despite major differences
between them they are used interchangeably, and that there is a need to distinguish between the
two. Hence, the author makes an attempt to explain the concept in detail. The research paper is
limited to section 6 and 21 of the Transfer of property Act, 1882 and does not explore any other
types of interests associated with the property making its impact limited.

2.3 RESEARCH QUESTIONS

The research paper will focus on answering the following questions:

 What are the essentials to constitute a contingent interest in an immoveable property under
Transfer of property Act, 1882.
 What are the essentials to constitute a spec successionis over a property under Transfer of
property Act, 1882.
 Whether contingent interest and spec successionis are fundamentally same concept under
Transfer of property Act, 1882.
 What is the difference between spec successionis and contingent interest under Transfer of
property Act, 1882.

2.4 SOURCES OF DATA

For the purpose of this paper only data obtained from secondary sources was used. Secondary
sources of data were books, thesis reports, seminar papers, articles, internet websites, published
books, legal journals and newspapers.

2.5 METHOD OF WRITING

The nature of this research paper is a combination of both exploratory and explanatory form of
research. The research starts with exploratory research and then goes on to explanatory method
of research as explanatory research attempts to answer the question as to how contingent interest
and spec successionis are both different concepts under the Transfer of Property Act, 1882. The
researcher has meticulously chosen the following method of writing as this form of research
allows for the researcher to be creative in order to gain the most amount of insight on a subject.

2.6 MODE OF CITATTION

For the present research paper, the researcher has used Bluebook (19th edition) mode of citation.

3. NATURE OF CONTINGENT INTEREST

1. Future possible interest- Contingent interest is a future possible interest. In a transfer of


property where the transferee’s interest is contingent, he has only a future possible right in
respect of property transferred to him. It is neither a present right nor a certain right. Since the
happening or not happening of the event, is uncertain, the interest dependent on it is also
uncertain. In a contingent interest, the right of enjoyment is also dependent on some event or
condition which may or may not happen or be performed.8

2. Not heritable- A contingent interest is not a heritable interest. Where a person having
contingent interest dies (i.e. dies before vesting) his legal heirs do not get anything, not even the
contingent interest. After the death of person his legal heirs are entitled to inherit only those
properties in which he had a vested interest at the time of his death. In Rajesh Kanta Roy v. Smt.
Shanti Devi9 the Supreme Court observed thus:

“In the case a contingent interest, one of the features is that if a person dies before the
contingency disappears and before the vesting occurs, the heirs of such person do not get the
benefit of the gift (transfer).”

3. Transferable interest- Contingent interest is a transferable interest. However, since a


contingent interest is itself an uncertain interest in the property and transferor’s own title is not
perfect, the transferee too gets an imperfect title. If the contingent interest subsequently becomes
vested, the transferee’s interests also becomes vested. But if the contingency could not happen
the transferee does not get any title in the property. In other words, although a contingent interest
is transferable, the transferee’s title is subject to the same contingency as it was before the
transfer was made.

3.1 SALE OF INCHOATE CONTINGENT INTEREST PRIOR TO VESTING-

A father and his son purported to transfer certain property as owners when in fact the father had
only life interest in it and the son had an inchoate contingent interest which had become which
had not become vested, i.e. an undivided share in the family property which was to vest on his
father’s death. The sale was held to be in efficacious till the partitioning of the property.10

4. SPEC SUCCESSIONIS – NON- TRANSFERABLE UNDER SECTION 6.

8
Shashi Kantha v. Promode Chandra, (1932) Cal.600.
9
AIR 1957 SC 255.
10
Bay Berry Apartments P. Ltd v. Shobha, AIR 2007 SC 256.
Spes successionis means expectation of succession. Expectation of succession is expecting or
having a chance of getting a property through succession (inheritance or will). Spes- successionis
is, therefore, not any present property. It is merely a possibility of getting certain property in
future. Spes-successionis under section 6 sub-clause (a) includes:

1. Chance of an heir apparent- Heir apparent is apparently an heir but not legal heir. Heir-
apparent is a person who would be heir in future if he survives the propositus (the deceased
whose property he inherits) and if the propositus dies intestate (without making any will). Father
and son are entitled to inherit the property of each other. If the father dies first, the son becomes
the father’s heir and inherits the properties of his father. But if son dies first i.e. while the father
is still alive, he cannot inherit father’s property. Who would die first, i.e. who survives whom, is
not known because it is future uncertain event. Accordingly, during the life off the of father, the
son cannot be called as his heir; he is simply heir- apparent of his father. An heir- apparent has
only a chance of inheriting the property subject to two possibilities (1) he survives the propositus
and (2) the propositus dies intestate i.e without making any will. It is possible that though the son
survives his father but he finds that his father had made a will under which the property is to be
given to another person after his death and not to his heirs. Thus, before the intestate death of the
propositus, the “chance” of an heir apparent of getting the is merely a future possible interest. It
is a bare right which does not create any interest in favour of the heir- apparent. Law cannot treat
it as a present fixed right in the property. Therefore, chance of an heir apparent is a non-
transferable property.

In Samsuddin v. Abdul Hussain11 the court held that release deed in respect of 1/3 share in
property of her father, after his death for a certain consideration is void as she is only an heir
apparent and had no right in his property before death. The court held that release is no defense
because it is a transfer of spec- successsionis.

2. Chance of a legacy- chance of a legacy means expectancy of getting certain property under a
will. The well settled law of wills is that a will operates only after the death of the testator (who
makes the will) not on the date when it is written. Further, it is the last will which prevail and if
two or more wills have been executed in favour of different persons, only the legatee under the
last will which is entitled to get the property. Accordingly, where a person executes any will,
11
(1906) 31 Bom. 165.
before the death of that testator, the legatee has simply a chance of getting the property because
(1) the legatee may not survive the testator and (2) the will in his favour might not be the last
will. Before a will operates i.e before the death of the testator, the legatee has merely a hope of
getting properties in future provided it is the last will.

Accordingly, the chance of a relation or a friend or any person receiving a legacy is a possibility
even more remote than the chance of succession of an heir and is, therefore, not transferable.12

3. Any other possibility of a like nature- Any other possibility of the like nature would mean
any other possible interests or property which is as uncertain as the chances of an heir apparent
or chance of a relation of getting property under a will. The central idea behind clause (a) is that
any property which is merely a future uncertain possible interest should not be made a
transferrable property. Therefore clause (a) exclude not only the chance of an heir apparent or of
a legatee but also any other “chance” of getting future property which is not at present a fixed
right of the transferor. The possibility of getting a property in future as contemplated here is like
the possibility of getting a prize in a competition or winning a lottery and hence non-
transferrable.

4. DIFFERENCE BETWEEN CONTINGENT INTEREST AND SPES SUCCESSIONIS

Contingent Interest and Spes Successionis are both future possible interests. In both, there is no
present fixed right in respect of property and in both the cases there is a possibility of “chance”
that it may become a perfect title in future. But, in a contingent interest the degree of this
possibility is lesser as compared to spes successionis. For instance, where a property is
transferred subject to some specified uncertain future event, there are only two possibilities,
namely either the event happens, or the event does not happen. But spec successionis or mere
chance of heir apparent is dependent on several possibilities e.g. (i) the heir apparent survives the
propositus (deceased person) (ii) even if he survives, the propositus during his life has already
transferred the property or, (iii) he has made a will of that property. So, spec successionis has
been regarded as a mere future possible interest. Therefore, under section 6 (a) of this Act, spec
successionis is a non- transferable interest. Contingent interest is not “mere” possible future

12
See Mulla: Transfer of Property Act, p.59.
interest; it is simply uncertain. Therefore, law has allotted the transfer of such interest. Subject to
contingency a contingent interest is a transferable interest. Pointing out the difference between a
contingent interest and spec successionis in Ma Yait v. Official Assignee13 the privy council
made the following observation: “……… the contingent interest which the children took,
whether they took it under the first, second and third schedules or under She fourth schedule, was
something quite different from a mere possibility of a like nature of an heir-apparent succeeding
to the estate, or the chance of a relation obtaining a legacy, and also something quite different
from a mere right to sue. It is a well ascertained form of property-it certainly has been transferred
in this country for generations-in respect of which it is quite possible to raise money and to
dispose of it any way that the beneficiary chooses.

5. COMPARING SPES SUCCESSIONIS AND CONTINGENT INTEREST –

A contingent interest is distinguishable from a mere spes successionis14.  Spes Successionis


cannot be transferred, whereas, contingent interest can be transferred. A contingent interest is
something quite different from mere possibility of a like nature of an heir apparent succeeding to
the estate, or the chance of a relation obtaining a legacy. It is also something different from mere
right to sue, as it is a well ascertained form of property. It certainly has been transferred in this
country for generations in respect of which it is quite possible to raise money and to dispose of it
in any way the beneficiary choose. Contingent ownership is based upon the present existence of
an incomplete title and not upon the mere possibility of future acquisition. The distinction
between contingent interest and spes successionis may be understood by the following
illustrations:

1. Shyam is a Hindu, owing separate property who died leaving a widow Rita and a brother
Ram. Here, in this case, Ram has simply a chance of becoming the owner of A’s estate.
2. Shyam is a Hindu, owing separate property and makes settlement of his property to his
wife Rita for life and then to his son, if he should have one, and in default of a son of Ram.
Here, in this case, Ram’s interest is contingent and is transferable. Also, his contingent

13
AIR 1930 PC 17.
14
Pestonjee Bhicajee v. PH Anderson, (1938) 2 Mad LJ 906.
interest is something more than a simple chance of becoming the owner of it. He has an
interest contingent on Shyam not having any son.

6. CONCLUSION:

In this research paper, Spes Successionis and Contingent interest is compared and shown how
they are different from each other. The main point to understand and take note of is that, the
transfer of property under the Contingent interest happens only when the condition is fulfilled,
and had it been the case that the condition is not fulfilled, then the transfer is not valid. The
conditions must be fulfilled and must necessarily comply with the preamble rules that speak of
justice, fairness and good conscience, the three main principles of natural law on which all this
act15 is based. Whereas, under section 6 clause (a) possibilities referred are in the nature of
uncertain future interest subject to several possibilities. Law cannot take the risk of recognizing
any interests subject to several possibilities. It may be noted that contingent interest as provided
in section 21 of the Act is also a possible interest depending on uncertain future event. But
contingent interests are transferable interests because here the possibilities are coupled with some
interest; they are not bare possibilities.16

7. BIBLIOGRAPHY

Books:

 Dr. Poonam Pradhan Saxena, Property Law 387-390 (Lexis Nexis, 3rd ed. 2017).

 Dr. R.K. Sinha, The Transfer of Property Act (Central Law Agency, Twentieth Edition.
2019).

Web Links:

15
Transfer of Property Act, 1882.
16
Pulwanti Kunwar v. Janeshar Das, (1924) 46 All. 575.
 http://www.legalservicesindia.com/article/2163/SPES-Successionis-As-An-Exception-To-
Transferability.html
 https://racolblegal.com/contingent-interest-and-spes-successionis-analysing-the-difference-
under-the-transfer-of-property-act-

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