Contract Law

Devilal v. Himat Ram

AIR 1973 Raj 39

Facts

Several defendants jointly undertook a construction contract for the Udaipur Town Hall as partners.
One partner acted as agent for the others while entering into a subcontract with Devilal.
Devilal later sued all the partners for money due under the subcontract.
The trial court passed a joint and several money decree.
During the second appeal, one respondent-partner, Himat Ram, died.
His legal representatives were not brought on record in time.
The appeal therefore abated against him.
The question was whether the entire appeal also abated or whether it could continue against the surviving partners.
Although the dispute involved procedural law, the relevant Contract Law question concerned the effect of release or non-proceeding against one joint promisor.

Whether the inability to continue proceedings against one deceased joint promisor discharged the remaining joint promisors.
Whether surviving partners continued to represent the dissolved firm for unfinished transactions.

Under Section 44 of the Indian Contract Act:
release of one joint promisor does not discharge the other joint promisors;
the released promisor also remains responsible to the other joint promisors for contribution.
Joint promisors may be jointly and severally liable to the promisee.
Under Section 47 of the Partnership Act, after dissolution, partners’ authority continues so far as necessary to:
wind up the firm’s affairs;
complete unfinished transactions.
Surviving partners may represent the firm’s interests for winding-up purposes.

The defendants had undertaken the town-hall project jointly as partners.
The plaintiff had claimed recovery against them jointly and severally.
Himat Ram’s death and procedural abatement did not extinguish the underlying debt.
The surviving partners continued to represent the partnership for settlement of unfinished obligations.
Even treating the defendants merely as joint promisors, Section 44 made the position clear.
Releasing or being unable to proceed against one joint promisor does not free the others.
The remaining respondents could therefore continue to be pursued for the contractual debt.
The Court distinguished between:
abatement of proceedings against one individual; and
substantive discharge of the joint obligation.
The first did not produce the second.

The Rajasthan High Court held that the appeal did not abate as a whole.
It could continue against the surviving partners and joint promisors.
Use this case for: release or procedural discharge of one joint promisor does not discharge the remaining joint promisors under Section 44.