PROPERTY LAW-I

29/09/2020
SECTION 8
And as per Section. 8, it will be presumed that all interest in the property and legal incidents
attached shall stand transferred to the transferee while transferring the property. And this section
now proceeds with defining that what are the legal incidents that get transferred with the transfer
in property.
So, if the property is a land then the easement, rent and profit accruing after the transfer and
things attached to the earth, they all get transferred along with the property if it is a land.
If a property is a machinery attached to the earth, then all the moveable parts of the machinery
they also get transferred.
If the property is a house then again the easements annexed, the rent accruing after the transfer,
all the locks. Keys, doors, windows, etc. which are provided for permanent use (definition of
immovable property- where the property is attacked or other actionable claim then all the
securities attached with the actionable claim/debt, they also get transferred provided that they
should not be a security for other claims which were not transferred). But in no case the arrears
of interest which were accrued before the transfer get transferred. So, the rent accrued after the
transfer and not the arrear of rent accrued before the transfer.
If the property is money, then again whatever comes after the transfer of property yielding
money then that also get transferred to the transferee.
The whole section presumes that there is no contrary intention and what shall be the intention,
shall be construed by interpreting the deed of transfer and while interpreting all the rules of
interpretation apply.
SECTION 9
Of academic interest only. Because S.9 permits only oral transfer and says that until and unless it
is required by any provision of law that the transfer must be in writing then in other cases the
transfer may happen orally also. But then if we analyze the different transfers we find that
generally all the major transfers require such transfer to be in writing and so it is of academic
interest-only permits oral transfer. For ex- in case of sale of immovable property and value is 100
rupees or upwards then the demand is that this transfer should be through a written instrument.
So, sale of property or reversion of intangible things, simple mortgage, all mortgages of 100
rupees and upwards, leases, exchange- all require the transfer deed in writing.
TRANSFERS ATTACHED WITH CERTAIN CONDITIONS
When the property is transferred then the transferor has right to transfer it-
1. ABSOUTELY
2. WITH CONDITIONS ATTACHED- meaning that conditional transfers are permissible
under the Act. But these conditions must not be in violation to what is permitted under
the Act itself.

1
 PROPERTY LAW-I

These conditions (that are in violation of the Act) may be such- if those conditions were attached
then they render the transfer void. Secondly, the condition is such that they render the condition
void and transfer valid.
So, 2 situations where conditions which are not permissible, if attached-
 Render the whole transfer void
 Where the transfer is conducted as if there were no conditions attached. Certain sections
where the law treats those conditions as void and transfer as valid. (section 10)
SECTION 10
This section talks about condition restraining alienation. Says that if the property is transferred
subject to any condition or limitation which absolutely restrains the transferee from parting with
or disposing it then that limitation is void and transfer shall take effect as if no condition has
been attached to such transfer.
The principle behind this provision is that right to transfer a property is incidental to ownership
and is inseparable from ownership. So an owner has right to deal with property and even to
transfer sale and this right is inseparable from right of ownership. Moreover, this rule is based on
public policy which allows free circulation and disposition of property. In the interest of
property, it is essential that it should be free for circulation and disposition and should not be
allowed to be stuck with someone. So an owner has right to sell.
The provision says now that if there is a condition attached which absolutely restrains
(required here- absolute restriction). In case there is a partial restriction then such a partial
restriction is permissible.
Section 10 mein you can transfer the property absolutely or partially but you cannot
impose a condition that restricts you from alienating the property absolutely.
Absolute Restriction upon someone from disposing the property- VOID. Transfer here is not
void but the condition.
Example- A transfers the property to B with the condition that absolutely restrains B from
disposing. Here this condition is void, transfer shall take effect as if no condition attached. So, B
is free to dispose of the property regardless of the condition so attached. Because it is a right
inseparable from right of ownership which is already transferred to the transferee.
Partial restriction upon disposing- VALID.
 In Re Koscher Chancery Division, 1884
A made a gift of the house to B with the condition that if B sold the property during the lifetime
of A’s wife then she should have an option to purchase it for, say Rs.10000. The value of
property at the time of sale was- Rs.10 lacs. Going by the language of transfer, it appears that a
window has been given to B that if in his wife’s lifetime if he wishes to sell it then the property
so valued at Rs. 10 lacs shall be open for his wife to purchase it at Rs.10,000.

2
 PROPERTY LAW-I

Court- Even though a window has been given, still it is absolute restraint that this condition
absolutely restrains the transferee from disposing the property because no person with a right
mind would sell a property of 10 lakh rupees for 10000 rupees.
So, whatever is the language employed is immaterial and the court shall see the real effect of
condition. Real effect in this case is that B is absolutely restrained from transferring the property
because the condition so imposed. Thus, B declared free to dispose of the property as the
condition is in violation of S. 10.
Illustration- Suppose, A transferred a field to B with a condition that if B sold then he must sell
to c and nobody else. In this case, the transferor gives an option to B that in case you want to sell,
you must sell it to C. This too is taken by courts as an imposition of absolute restraint in so much
that C may be so chosen as to render it reasonably certain that he would not buy the property at
all. The real effect is that you can choose the person C who doesn’t purchases the property. So,
here the window is given but it is of no avail and thus under S.10 B is free to dispose as if no
condition attached. TRANSACTION VALID. CONDITION VOID.
So, language used is immaterial, the courts looks only into the real effect of transaction. If the
real effect is that the imposition is absolute, then court treats it as absolute restraint whether in
the language of the transaction a window is created.
 Cali v. Elliot, Chancery Division, 1896
A tea plantation was bequeathed to some person absolutely and the condition was attached that if
the bequeathee would sell the property then I direct her to pay a certain amount of money to each
of the person as mentioned in the deed out of the proceeds of the sale.
Court- This is a condition which is repugnant and void. Therefore, an absolute restraint and
cannot so transfer with conditions absolutely restraining the transferee. So, whatever interest in
transferred generally, the transferee has a right to re-transfer the same. However, partial restraints
are permissible.
Examples where the restraints were absolute but the Court read them as Valid-Partial
Conditions
Suppose a property is transferred with a condition attached that if transferee intends to dispose of
the same he can dispose the property to a certain group, class. In such a case the court says that it
is a wide window and restriction is not absolute though it restrains the right but partially.
Therefore, Valid and transfer takes place subject to condition.
If the condition is such that property can be transferred but not outside the family. It is partial
restraint and thus valid.
But suppose the property is transferred to the transferee with the condition that for a certain
period of time you will not transfer the same. Court said- It is an absolute restraint and is
violation in right of ownership.

3
 PROPERTY LAW-I

But in case of family compromises, the court said that even those restrictions which are termed
in absolute terms, would be treated as valid because they are for the purpose of compromising a
dispute in the family. Through court orders, the restriction which absolutely restrains shall be
valid in case of a family compromise.
 Mata Prasad v. Nageshwar Sahai, Allahabad HC 1925
There was a dispute as to succession of a property of the deceased between the widow of the
deceased and the nephew that who shall own the property now. This whole dispute was
compromised on the terms that widow is to retain the property for life and after the life of widow
the property shall go to nephew. So in dispute settlement the title of nephew was admitted that
the property shall go to nephew. But right is also given to widow that she shall retain the
property till life and during the lifetime of the widow the nephew shall not alienate the property.
Dispute settled on condition that though the nephew is the owner but nephew shall not alienate
the property during the lifetime of widow. Even though the restriction is absolute, it has been
treated as valid because the restriction is imposed to settle a dispute arising in the family.
Privy Council- This restriction not hit by section 10. Family compromise which is prudent in the
circumstantial case and a restriction based on that is valid.
EXCEPTIONS TO SECTION 10
2 Exceptions-
1. As to lease- If the condition imposed in a lease that the leasee shall not sublet or assign
his right to any other person, it shall be valid even though absolute in nature. Reason
being that there are leases which are permanent in nature. (99 years of lease and further
renewal). So such condition can be imposed that cannot sublet, assign right alienate or
transfer, can only renew on death of owner in favor of the heirs of the deceased.
The same restriction in case of mortgage, pledge, in case of immovable property- not
valid. Because here mortgagee/pledgee/owner of immovable prop can assign his right or
sublet.
2. When a property is transferred and the condition restrains alienation- it can be imposed
when property is transferred to a married woman who is not a Hindu, Mohammaden or a
Buddhist. So, if the woman is married and not a Hindu, Mohammaden or Buddhist then
property can be transferred subject to condition that during the continuance of marriage
you will not alienate the property- Valid restriction.
SECTION 11
If the property is transferred absolutely in favor of a person then if there are terms which direct
that how the interest should be applied or enjoyed, then again the transfer happens as if no such
condition has been imposed on transfer.
S.10 and S.11 though look similar but there is a difference that in case of S.10, property is
transferred and restriction is imposed absolutely in alienation. When S.10 comes into operation

4
 PROPERTY LAW-I

and says that if the restriction is absolute then the transfer shall be as if no condition is attached
and transfer becomes valid. Transfer is not absolute here but restraint is.
But in case S.11, when on a transfer an interest is created absolutely in favor of any person but
the terms of the transfer directs that how such interest shall be enjoyed then he shall be entitled to
receive the property as if no such direction has been imposed.
So in case of S.10 the property is transferred- absolute transfer or partial transfer. But the
condition imposed must not be absolute. In case of S.11 the property transferred must be an
absolute transfer and then if the condition is imposed as to how the interest is to be enjoyed in
that case this whole condition shall be repugnant and the condition becomes void and transfer
shall become valid.
30/09/2020
In S.11 the property is transferred absolutely (meaning no rights are now left with the transferor
and all rights stand transferred to the transferee)- like in sale, gift. So, in S. 10 property is
transferred- either absolutely property or partial property (may be transfer of certain rights or
transfer of all rights). Irrespective of how transferred the restriction is on absolute restraint in
alienation. In S.11- when property is transferred absolutely then any condition imposed which
restrains the manner in which the property is to be enjoyed or how it is to be disposed shall be
void and transfer shall take effect as if no such condition has been imposed.
Reason for such provisions that Law says that when one becomes the absolute owner then he has
all the rights to receive, enjoy and dispose the property. And none can abrogate this with a
private arrangement. Like in a deed of sale you cannot impose a restriction and create a life
interest in favor of vendee because this is plainly repugnant to the interest created. If the interest
created in favor of transferee is absolute interest, then imposing restriction is repugnant and
makes the prohibition void. S.11 corresponds to S.138 of the Indian Succession Act, 1925.
Suppose a sum of money has been bequeathed to a person towards purchasing property or to
purchase an annuity or to invest in a business. A sum of money has to be given by bequeath
(meaning that rights are transferred absolutely) to transferee and the term of bequeath says that
the sum transferred for the purpose of either purchasing some property or purchase an annuity or
to place in some business. The transferee chooses to receive the money; it is held that this person
is entitled to receive the money devoid of any such restriction imposed because this whole
restriction would be repugnant to the interest created. When you bequeath the property to a
person by will, the person is entitled to receive the property and you cannot restrict of how the
property is to be used and enjoyed by the transferee.
BASIC DIFFERENCE BETWEEN S.10 AND S.11
Under S. 10, the transfer may be absolute or partial but if the restriction in alienation is absolute
in that case that whole transfer becomes valid and devoid of any restriction imposed. Here,
transfer can be absolute or partial but the restriction can’t be absolute.

5
 PROPERTY LAW-I

Whereas in S.11, the property transferred is absolute, all the rights are transferred. But once
transferred absolutely, one cannot impose restriction as to how that property is to be enjoyed
because you transfer all rights in the property it means that the ownership rights are with
transferee and this ownership right suggests that the person is the absolute owner and can use the
property in whatever manner he likes. And any restriction is repugnant to the interest and thus
void.
S.10 is directed towards transfer of interest- how the interest is transferred (in what manner-
absolute or partial). But the restriction imposed is absolute. Whereas in S.11 it is directed against
free enjoyment.
S. 10 is applicable against all transfers whether limited or absolute whereas S.11 only comes into
operation if the transfer is in the absolute interest of the property.
EXAMPLE- A transfers the house to B for life with the condition attached that B will not
alienate his life interest in any event. So, this restriction is absolute restraint. Therefore, such
restriction is void under S.10. (S.10- when the right of alienate is restrained absolutely)
A transferred the property for life to B on the condition that B shall reside in the house. Meaning
that if B will not reside then the transfer would become invalid and void. Here, partial interest is
transferred. This is a valid condition because here the restriction imposed is not absolute. This is
partial restriction. It is not hit by S.11, reason being the interest created is not absolute interest.
Had his interest been absolute then any restriction on enjoyment shall be void.
However, if it had been an absolute transfer like a gift or sale from A to B and if then such a
restriction had been imposed then would be hit by S.11 as an absolute transfer the interest in that
is being prohibited by not letting freely enjoy it.
EXCEPTION CREATED in S.11- This right is also given to the transferor that when the
property is transferred absolutely then in one case the transferor can impose the condition on
how the property is to be enjoyed if that restriction for a more beneficial enjoyment of his own
property which is adjoining.
Suppose there are 2 (A&B) pieces of property and one of them is transferred by the transferor
absolutely to the transferee then if the purpose is to use the property more beneficially or to
secure interest in the property, the transferor imposes certain restrictions then such restrictions
are valid and is an exception to S.11.
B is transferred by transferor. But to have proper access to A, the transferor retains a part of B.
This condition is valid.
Suppose a property is transferred by A to B and to secure beneficial enjoyment of his own
property adjoining the land transferred, A imposes certain conditions on the transfer. The
condition imposed is that though the property is transferred to B but B shall not build certain
shops on the purchased parts or that the purchaser shall carry out annual repairs of the drain that
passes through the plot. The purpose of both the restriction is to enjoy the adjoining property
more beneficially. One restriction is to do and the other is not to do.

6
 PROPERTY LAW-I

Not to do- are called as Negative Covenants

To do certain things- is called positive Covenants.
These covenants bind both the purchaser and the seller. So if B purchases the property subject to
these conditions then he is bound by these conditions.
Once a trust is created for charitable purpose then subsequently it cannot be transferred. Because
they are non-commercial. But regarding applying restriction is the same as above discussion. So
if there is a trust for religious purpose and trustee is the transferee. So here the transfer is not
absolute, such restrictions can’t be imposed in case the transfer is absolute. If the transfer is
partial, then the only thing you cannot impose is that you cannot alienate the interest and once a
property is transferred absolutely and subject to condition that how it is to be utilized then the
transferor has to prove that this restriction is imposed only for the purpose of securing more
beneficial enjoyment of his own property. Suppose it is said that you can use the property only to
make temple is no condition that facilitates a beneficial enjoyment of own property thus an
invalid condition.

7
 PROPERTY LAW-I

06/10/2020
Though discussed that TP Act deals with transfer inter vivos (between living persons) but then
there are certain sections which create certain rules regarding transfer for the benefit of unborn
persons. These benefits are different from the transfer discussed earlier.
S.13 is one of the group of those sections which refer to the interest created for the benefit of the
person not in existence on the date of the transfer. Such interest can be created subjected to
certain rules in S.13 and S.14.
From S.10-S.17, these sections are enacted for encouraging free alienation and circulation of
property. That any contrivance against this free circulation shall be treated as void. It is in the
interest of public in general (a public policy) that the property shall be free for circulation
amongst the society. Shouldn’t be tied for too long in the same hands. These sections (13, 14, 15,
16) are restrictive in nature and shall be read in conjunction with S.19 and S.21 (interest rested
and interest contingent).
S.13 creates an interest in favor of an unborn person and this section corresponds to S.113 of the
Indian Succession Act. S.13- “Where on a transfer-----------------in the property.” This section is
an attempt to import into India what used to be known as the rule against double possibilities as
used to be in English jurisprudence. This was an old rule in England. India is now much more in
consonance with the new rule.
 Whitney v Mitchel, 1890 Chancery Division
The rule against double possibilities as existing in England, permits transfer to an unborn person
but no transfer of life interest to an unborn child of unborn person.
For ex- In case of person who is living on date of transfer any number of life interest can be
created. A can transfer life interest to B, to C, to D, provided that B, C and D were living at the
time of transfer. So, here ‘n’ number of life interest can be created. But if in the ultimate transfer
it intends to go to a person who is still not born then an interest can be created in favor of that
unborn person. But you cannot create a life interest in favor of the unborn child of the unborn
person. Because here now there are double possibilities and this rule is against the double
possibilities. So here in addition to these living people the life interest can also be created for an
unborn person. But not for the unborn child of the unborn person. Because here what happens is
the creation of double possibilities and the rule is against double possibilities.
First possibility- It is in favor of the unborn person (X). So, X must be born before the life
interest of the nth person terminates because if the life interest in favor of nth person terminates
and X is not born then his interest terminates. There cannot be an abeyance of ownership. In
any transfer which is calculated for abeyance of ownership is void. Where terminated the
property is reverted back. In case it doesn’t terminate and is born before the nth interest
terminates then the child gets a vested interest.
Second possibility- In favor of unborn child of unborn person. This is ruled out by the rule
against double possibilities in the case above. Same has been adopted by India.

8
 PROPERTY LAW-I

This S.13 has certain rules-

1. Cannot be a direct transfer in favor of unborn person. And such transfer can only happen
through a machinery of trust where there is some person in whose trust the property vests
before it is transferred to that unborn child on his birth. Suppose A transfers a property to
an unborn child directly and A dies and this child is not born then it would be an
abeyance of property. Therefore, such direct transfer not permitted.
2. A prior interest must be created. The interest so created in favor of an unborn child shall
always be precede by a prior interest created in favor of a living person. So, that as soon
as a child is born the property is vested in him and there is no abeyance of ownership.
3. If in favor of an unborn child an interest is transferred, then the interest so transferred
must be an absolute interest. So, whatever is transferred it should be devoid of any further
restriction and the entire interest in property must be transferred to the unborn person.
Suppose if a property is transferred to an unborn child and if only life interest is
transferred then such a transfer shall be void because S.13 specifically says that such a
transfer doesn’t take effect.
Illustration- A transfers property of which he is the owner to B in trust for A and his intended
wife successively for life. So firstly to B for life then to A’s wife for life. And after the death of
survivor for the eldest son of the intended marriage for life. Then after the death of the survivor
(either B or the wife) then it is to be transferred to the eldest son of the intended marriage. So,
here the son is still to be born. So here there is life interest in favor of an unborn child and then
after the death of this unborn child to his child absolutely.
Here, the transfer from A to B and then to wife, since all the transfer is to living persons here
thus it will be a valid transfer. But when the property is transferred in favor of the eldest son of
the intended marriage (still to be born) then this life interest cannot be created and by virtue of
S.13 this transaction becomes void. This transfer shall not take effect. After the death of survivor
(B or wife) the property shall revert back.
The outcome of this section- If interest is to be created or property to be transferred in favor of
an unborn child the it shall be either through a living person or by some machinery of trust in
whom the property must vest before it is transferred to the child on birth.
Secondly, there has to be a prior interest and thirdly absolute interest must be transferred and no
life interest can be transferred to an unborn child if there is a transaction which transfers life
interest in favor of the unborn person then this transaction shall fail, it shall not take effect.
S.14- The rule against perpetuity and talks about the remoteness of vesting.
S.16- If a transfer fails because of being void under S.13 or S.14. If any transaction is void or
invalid being void under S.13 (if property transferred to unborn child and is a life interest) or
S.14 (if perpetuity is created in favor of a person and hit by s.14) in that case any transfer which
is dependent upon these previous transfer shall also fail. So, if a transfer depends upon some
preceding transfers but the preceding transfer is void (as under S.13 or s.14) then the subsequent
transfer also fails.

9
 PROPERTY LAW-I

 Girjesh Dutt v Datadin (1934) Awadh Court

A transferred her property to B and B was her nephew’s daughter. In a way transferred property
by way of gift for life to B. The deed of transfer further provided that after the life of B the
property shall go to B’s male descendants (sons and grandsons). This transfer shall be absolute.
Meaning that if there are sons and grandsons of B the after the death of B the property would go
to them absolutely.

13/10/2020
S.10- S.17- enacted to encourage free circulation and alienation of property. S. 13, 15, 16 and 20
are restrictive in nature and they must be read in conjunction with S.19 and S.21.
S.19 and S.21 talk about vested interest and contingent interest. As far as how interest is
transferred is concerned, there are 3 marked stages-
1. An interest may be vested in possession
2. Vested not yet in possession
3. Contingent
Difference between Vested Interest and Contingent Interest
Vested Interest- The title to the property is perfect at the date of transfer or if it is dependent
upon a condition then the condition is such that it is bound to happen.
Contingent Interest- The title is yet not perfect but can be perfect on happening of an event
which itself is contingent (event may or may not happen).
For ex- A transfers a property to B (B has vested interest in property because property is
transferred to B and he is a living person. Transfer is inter vivos) for life and then to C (C has a
vested interest because the only thing that comes in between his interest and interest of A is B’s
interest And B’s death is an event that is bound to happen). In case of vested interest, the title of
transferee is perfect on date of transfer or is dependent on a condition which is bound to happen.
So on the date of transfer, C has a vested interest.
Now in case of contingent interest- A transfers a property to B for life and to the unborn child of
C when he is of the age of 10. This event is a contingent event that the unborn child has to be
born and has to complete the age of 10 years, only then the property shall be transferred to C.
Thus, contingent because this event may or may not happen.
It is required to know whether it is vested or contingent interest because in case of vested interest
if the transferee dies before taking possession of the property, the right to the property shall go to
the legal heirs and his interest is not defeated. Whereas in case of contingent interest because the
transfer itself is based on an event which may or may not happen then if the condition not
fulfilled then it won’t go to transferee. So, if transferee dies before happening of contingency
then the property shall revert back or the interest of transferee is defeated.
10
 PROPERTY LAW-I

Sections creating interest in favor of unborn person.

S.13- S.13 is an attempt to import into India what used to be known in England as the rule
against double possibilities. This rule was enunciated in Whitney v Mitchel. In English
jurisprudence, what is permissible is the older rule, creating life interest in favor of an unborn
person. But not creating a life interest in favor of issue of an unborn person.
A transfers a property to B for life (B is a living person)- it is permissible. Then to the unborn
child of B for life- permissible, under older rule of English jurisprudence. What is not
permissible is that unborn child of B (rule against double possibilities. There are 2 possibilities-
first- the unborn child should be born and then the issues of the unborn child should also be born.
English jurisprudence prohibits this transaction which transfers life interest in favor of issues of
unborn person. This rule has been incorporated in Indian jurisprudence.
S.14- Such interest (interest for unborn person) can be created subject to certain rules which
talks about perpetuity. If any transfer has been made in violation of conditions provided in S.13
and S.14, it renders the whole transfer invalid. So, not the condition but the entire transfer
becomes invalid.
S.13 which permits creation of interest in favor of an unborn person, it permits so subject to
certain rules. So S.13 lays down 3 rules subject to which interst can be transferred to an unborn
person-
1. No direct transfer. There can be no direct transfer to an unborn child because if such transfer
happens and before the birth of the child the transferor dies then it would create an abeyance of
ownership of property. (rule states that any transfer so calculated to create abeyance of
ownership of property shall be void). So it is through mechanism of trust that property shall be
transferred to such an unborn person.
2. There shall be a prior interest created in favor of person who is living. So property can be
transferred from A to B for life, from B to C for life and then to the unborn child. This unborn
child has to be born before the last interest terminates (before the death of C, the unborn child
should be born). If not born, then transfer to become void and property shall revert back.
3. it is not permissible to transfer a life interest in favor of unborn person but an absolute interest.
Absolute interest in property must be transferred to the unborn person. If life interest transferred
then that transaction becomes void.
What about a child in womb- A person unborn or on who exists?
 Doe v Clarke (1795)
Indian Authority
 Tagore v Tagore (1827) Calcutta HC
Both these cases state that a child in womb shall be treated as in existence and not one who is yet
to be born and child in womb is called en ventre sa mere.

11
 PROPERTY LAW-I

When a property is transferred then it is important that its validity must be assessed by the
transfer deed and not be actual events. So while assessing the transfer of interest to unborn child
is hit by S.13 or S.14, we must pay regard to the language of the transfer deed and not hoe the
actual events took place
 J.V. Satyanarayan v Pyboyina Manikyan, (1983), Andhra Pradesh HC
A father ‘F’ created a life interest in favor of son ‘S’ and subsequently an absolute interest in
favor of the unborn child of S (absolute transfer). This is the language of the deed. But what
actually happened is that before the birth of the unborn child of S, the son S executed a
relinquishment deed in favor of F.
Q- whether as the events actually happened and before the birth of unborn child the son
has relinquished his right in favor of F then there is nothing left to further transfer to the
child. So, the transfer to the unborn child can only happen after termination of interest of
son and by his own conduct the son has relinquished his own right in favor of F so this way
the unborn child should get nothing!
Court- Merely because the relinquishment deed was executed before the birth of the unborn
person, the gift in favor of unborn person will not fail because the validity of the transfer must be
judged with reference to the original deed and not by the voluntary act of the donee itself (S is
donee under the deed). The person who obtains the benefit of the deed cannot defeat the
terms of the deed. Either you negate the whole deed or accept the whole deed you cannot
pick and choose. So even if S has relinquished his right on the original settlement deed, the
interest shall vest in unborn child when he is so born.
This section must be read in conjunction with S. 19, 20 and 21. S. 20 says that unless any
contrary intention appears, on the birth the property shall vest in him.
S.14 lays down the rule against perpetuity. The purpose of this section (policy of law is to
prevent a property being tied up in one hands forever, it should be free for circulation). Property
can be tied in 2 ways-
1. As under S.10 where absolute restriction on alienation can be imposed. So, for this method of
tying the property forever, S.10 is the rule which prohibits that you cannot create absolute
restriction on alienation. Liberty of alienation shall not be exercised in its own destruction and all
contrivances shall be void which tends to create a perpetuity.
2. You can create successive partial interests in favor of unborn persons and therefore postponing
to a remote time when the property shall vest in somebody absolutely. (A transfers property to B
for life, B to C for life then to C’s unborn child absolutely). S.14 hits here and says that vesting
must not be too remote. If too remote, then such a transaction is void.
So called rule against perpetuity or rule against remoteness of vesting.
A number of life interest can be created for living persons (all the person have to be alive at the
date of transfer). In case of an unborn child, the vesting can be delayed but can be delayed to an
extent of- the minority of an unborn child. If nothing stated in contrary and that interest is not

12
 PROPERTY LAW-I

terminated in favor of the person who is the transferor, then the interest shall vest in the unborn
person. But S. 14 states that it is not an absolute rule that the property would vest in the unborn
person on birth. It can be delayed if the intention is that the property shall not be vested to an
infant (age of majority- 18 years. In case of a child for whom a guardian is appointed by a court
under Guardianship and Wards Act, the age of majority is 21).
In case of transfer of property, if the age of majority shall be 18 or 21 where guardian is
appointed?
One rule is to go by the language of the deed of transfer. So, transferor while transferring to
unborn child can’t foresee that in future a guardian would be appointed or not. Therefore, as far
as intention of transferor is concerned, he intends to transfer to unborn person at the age of
majority then this age is always 18 years old.
In case twins born, then property shall be equally divided amongst them.
S.14 deals with delay in transfer. So generally the property is vested on the date of transfer itself-
vested in possession.
Vested, not in possession- Suppose, property is transferred by A to B for life and then to the
unborn child. Now B is still alive and the child is born. So, here the interest vests in the child but
the property is in possession of B until he dies. So child has vested interest but no possession and
only gets the possession when B dies.
Property transferred to B and intended that on birth of the unborn child the property shall not go
to him, it shall be delayed (but S.14 states that the delay cannot be beyond the age of majority).
So A can state that property is transferred to B for life and to the unborn child of B but only after
attaining the age of majority.
Contingent- If language of deed is that property transferred to B for life and then to unborn
child.
Vested- If language of deed is that property transferred to B for life and delayed transfer to
unborn child to the extent that he shall attain the age of majority.
Invalid- If the age of unborn child is mentioned beyond 18 years of age.

19/10/20
S.14
Interest vested in person
Vested, but yet not in possession
Contingent
A transfers a property to B for life, so a life interest created here but not absolute. Now to unborn
child of B. when the child will be born the property will vest in him on his birth, this is the

13
 PROPERTY LAW-I

outcome of S.20. S.20 says that unless any contrary intention appears if the property is
transferred to an unborn person then the property will vest in the unborn person on birth. This
vesting may be delayed if the intention of the transferor is that the property should go to the
unborn person but should not vest in him till the time he is minor. So, if it states that property
shall vest in B’s unborn child but not until he attains the age of majority- is valid provided that it
fulfils S.13 and S.14 ki requirement that it is transferred absolutely and unborn child to be born
before the ultimate transfer in favor of B terminates or B dies. However this delay cannot be
beyond the age of 18 years of the unborn child. If is delayed beyond the age of 18 years then
invalid. This is the remoteness of vesting (cannot be beyond the age of 18 years of unburning
child).
Difference between delay in vesting (DV) and delay in enjoyment (DE)
For ex- A transfers property to B for life and then the property would go to the unborn child of B
on attaining the age of 20 years. This transaction has a peculiarity, because here the intention is
not to delay the vesting but to delay the enjoyment. Meaning that as soon as the child of B will
be born the property would vest in him. The only thing is that the enjoyment will be delayed. The
same principle applies here too- that regards shall be paid to the language of the deedand not the
actual events.
In actual event the property might vest in the unborn person in a shorter period of time. So, we
are not concerned as to after how long the property vest in him but about the language as to
transfer of property to the unborn person.
EXAMPLE 1- A transfers property to B for life and this transfer happens in the year 1950. After
B the property shall go to B’s first unborn child when he attains the age of 25 years. What
actually happens is that the child is born in 1951. B dies in 1977. Considering the 2 dates- the
child would get the property after 26 years (gets after B dies).
EXAMPLE 2- Again the property transferred to B in the year 1950. After B to B’s first unborn
child when he attains the age of 18 years. The child is born in 1975 (25 years after). B dies in
2000. To vest the property in. The property would vest in him after (25+18) = 43 years. So,
though it is a remoter period but we are not concerned with actual events but with language of
the deed.
In the first example- The transaction is INVALID because even though the vesting is not remote
but the age of vesting is beyond 18 years.
In the second example- The transaction is VALID because vesting to be done when the child is
of 18 years even though actually it gets vested after 43 years.
EXCEPTIONS TO RULE OF PERPETUITY
1. This rule of perpetuity is only applicable when an interest in the property is created. If the
interest in property is not created, then the rule will not apply. So, the rule of perpetuity
doesn’t apply in cases of Personal Contracts.

14
 PROPERTY LAW-I

Like- if a priest is appointed from same family from generations in the Shiva Temple
and they are being provided expenses and remuneration from time to time. It is a contract
which is person between the Shaivaites and the Pujari. It does not create any interest in
the property. So the rule of perpetuity doesn’t apply here as it is a personal contract.
Similarly in case of creating a charge. A charge is just to get the payment out of the
property that is put in charge. There is no interest created in the property itself.
In case of Equity of redemption- that when the property is given in mortgage it is an
inherent right in the mortgager that he can pay back the amount of loan redeem the
property. Equity of redemption is applicable to the mortgager and this right can only be
curtailed by the court by issuing a decree of foreclosure. So, equity of redemption is a
present right.
For ex- A (mortgager) transfers the property to B(mortgagee) by way of mortgage. A has
the right of redemption. Redemption starts at the same time when the mortgage is
executed if there is no such specification that from when can a redemption begin. There is
an agreement between A and B that A, his heirs, his assignees, the executors can redeem
the property whenever they like. It is a perpetual right given to them that whenever they
want they can redeem. Equity of redemption is a present right given to mortgager to get
back his own property and does not create any interest in the property.
Suppose, there is a lease and the lease is perpetual lease. Lease is when the property is
transferred from the leasor to the lease just for certain purposes. In this case if perpetual
lease is granted and the agreement is that this perpetual lease will be renewed from time
to time, it would still not be hit by S.14 because lease does not vest any property in lease.
After the lease is terminated the property goes back to the leasor.

There is a difference in English and Indian Law on this point.

As per English Law, an agreement or contract to transfer some interest in the property
creates an interest in the favour of the transferee. Like- A agrees with B to transfer certain
property (contract is to sell the property to B). Now English Law says that this transfer
creates interest in favor of B. So B has certain proprietary interest in the property.
Whereas in Indian Law this contract only gives only a contractual right to B. B has no
proprietary interest in the property and the only right that B has that if A breaches the
contract then B can sue for damages or specific performance and nothing more.

Also the rule of perpetuity doesn’t apply to right of pre-emption- when som e rights are
granted to one of the parties that they have a righto get something on priority. That before
anyone asks for it, that party has the first right to claim and only if they do not claim will
this right be available to anybody else to claim.
 London and Southwestern Railway Company V Gomm, 1882 Chancery Division (court
of appeal)
A railway company conveyed certain land to transferee and the transferee covenanted for
himself, his assignees, heirs that they will re convey the land to railway company in any
future time by taking back the money paid by him. This was the agreement. Now this is a
contract. In English law it is otherwise.

15
 PROPERTY LAW-I

Court (English Law)- This covenant between the transferee and the transferor (railway
company) created an equitable interest in favor of the railway company. But the
limitation was void (that in any future time him, his assignees, heirs will re convey)
because it contravenes the rule against perpetuity. This was hit by S. 14 that cannot vest
beyond the minority of unborn child.

In Indian Law such an agreement does not create any equitable interest in favor of the
transferee in the property. It is just a contract and what the transferee gets is just the
equitable interest in the contract itself. That the contract must be fulfilled by the
transferor and in case of breach the transferee has the right to sue. These agreements just
create obligation of fiduciary character and could not be enforced by contract and thus
not hit by rule against perpetuity.

Indian Case
Ram Baran Prasad v Ram Mohit Hazra 1967
The case is of partition between the 2 brothers A and B. There is pre-emptive clause in
favor of each other that if ever A will sell his property he will first ask B and vice versa.
This pre-emptive clause also applies to heirs and assignees of both the parties. This
property went from A to C and from C to X and from B to D and D sold the property to Y
without asking A.
Here X filed a suit against D for enforcing the right of pre-emption that both D and Y
knew about the pre-emptive clause and therefore this property shall first be offered to X
to be purchased and not to Y. So if his right is enforced then X has the right to get the
property by paying the amount which has been to D by Y.
Court- Decided in favor of X because what D and Y have contended that this pre-emption
clause is hit by perpetuity without specifying the period of limitation as per S.14, they
had granted the right to the other parties and to their heirs, assignees and is hit by S.14.
But court said that this is a contractual right not creating any interest in the property and
therefore this whole transaction between D and Y or the pre-emptive right is not hit by
S.14 and therefore X has a right to enforce the pre-emptive clause against D and Y.
So in India the case is decided otherwise. And that Pre-emption clause is not hit by rule
of perpetuity because it is just a contractual right and not creating any interest in the
property.

2. The second exception is provided in S.18 which says that this rule against perpetuity shall
not apply in cases of transfer of property which is transferred in benefit of public or
advancement of religion, knowledge or for any other object beneficial for mankind.
S.16
The section says that if any prior interest fails by reason of being void under S.13 and S.14 then
subsequent interest which is dependent on prior interest also fails. So, if prior interest fails then
subsequent interest also fails provided that prior interest failed by virtue of S.13 and S.14.

16
 PROPERTY LAW-I

If prior interest fails by reasons of S.13 and S.14 then subsequent dependent interest fails also
fails.
 Girjesh Dutt v Data Din (1954) Awadh Court
A makes a gift of his property to B for life where B was A’s nephew’s daughter providing
subsequently in the deed that after the death of B the property is to go to the male descendants
absolutely. If no male descendants, then the property is to go to the female descendants but
without power of alienation. If no female descendants, then the property is to go to nephew of A.
What actually happened- B died without any child (neither male nor female) and then the
nephew of a claimed the property.
Court applied the rule S.16 with rule that we are concerned with the language of the deed and not
the actual events. So analyse the event as intended by the transferor. As far as the property
transferred by A to B for life there is no objection. As far as the property is to go to the
descendants of B absolutely there is no illegality because property is transferred to the unborn
person absolutely and thus valid. Now the part which says that if no male descendant then to
female descendant without power of alienation and here the property transferred in favor of
female descendant is creating an interest which is not absolute and therefore hit by S.13 and thus
invalid. Transfer to the nephew of A is dependent on the failure of this interest that only after the
female descendants (if there is not any) he can get the property. So the transfer to nephew is
dependent on a prior transfer which is the transfer to female descendant but with a condition and
it fails under S.13 thus this transaction to A’s nephew is also invalid or void under S.16 which
states that that if a prior transaction fails in the light of S.13 and S.14 then any subsequent
transaction dependent on the prior transaction also fails.
So court applies the rule of S.13 and the rule that it is the language of the deed that they are
concerned with and not the Actual event.

17