LIABILITY OF JOINT PROMISOR & PROMISEE

Written By:- Ananya Rai (Amity Law School)

Devolution of joint liabilities (Section 42)

When two or more persons have made a joint promise, then, unless a contrary intention appears by the contract, all such persons, during their joint lives and after the death of any of them, his representative jointly with the survivor or survivors and after the death of last survivor, the representatives of all jointly, must fulfil the promise.

Analysis of Section 42

If two or more persons have made a joint promise, ordinarily all of them during their life-time must jointly fulfill the promise. After death of any one of them, his legal representative jointly with the survivor or survivors should do so. After the death of the last survivor the legal representatives of all the original co- promisors must fulfil the promise.

Example: X, Y, and Z who had jointly borrowed money must, during their life-time jointly repay the debt. Upon the death of X his representative, say, S along with Y and Z should jointly repay the debt and so on.

   This rule is applicable only if the contract reveals no contrary intention. We have seen that Section 42 deals with the voluntary discharge of obligations by joint promisors. But if they do not discharge their obligation on their own volition, what will happen? This is what Section 43 resolves.

Any one of joint promisors may be compelled to perform Section 43

When two or more persons make a joint promise, the promisee may, in the absence of express agreement to the contrary, compel any one or more of such joint promisors to perform the whole of the promise.

Each promisor may compel contribution — Each of two or more joint promisors may compel every other joint promisor to contribute equally with himself to the performance of the promise unless a contrary intention appears from the contract.

In other words, if one of the joint promisors is made to perform the whole contract, he can call for a contribution from others. Sharing of loss by default in contribution — If any one of two or more joint promisors makes default in such contribution, the remaining joint promisors must bear the loss arising from such default in equal shares.

Explanation to Section 43

Nothing in this section shall prevent a surety from recovering, from his principal, payments made by the surety on behalf of the principal, or entitle the principal to recover anything from the surety on account of payment made by the principal.

Example 1: A, B, and C jointly promise to pay D, Rs 3, 00,000. D may compel either A or B or C to pay him.

Example 2: A, B and C are under a joint promise to pay D ` 3, 00,000. C is unable to pay anything A is compelled to pay the whole. A is entitled to receive ` 1, 50,000 from B.

We thus observe that the effect of Section 43 is to make the liability in the event of a joint contract, both joint & several, in so far as the promisee may, in the absence of a contract to the contrary, compel any one or more of the joint promisors to perform the whole of the promise.

Effect of release of one joint promisor- Section 44

The effect of release of one of the joint promisors is dealt with in Section 44 which is stated below:

Where two or more persons have made a joint promise, a release of one of such joint promisors by the promisee does not discharge the other joint promisor or joint promisors, neither does it free the joint promisors so released from responsibility to the other joint promisor or promisors.

Example: ‘A, ‘B’ and ‘C’ jointly promised to pay Rs 9,00,000 to’D. ’D’ released ‘A ‘from liability. In this case, the release of ‘A’ does not discharge ’B’ and ’C’ from their liability. They remain liable to pay the entire amount of Rs 9,00,000 to‘D’ And though ‘A’ is not liable to pay to ‘D, but he remains liable to pay to‘B’and‘C’i.e. he is liable to make the contribution to the other joint promisors.

Right of Joint Promisees

The law relating to the Devolution of joint rights is contained in Section 45 which is reproduced below:

     “When a person has made a promise to two or more persons jointly, then unless a contrary intention appears from the contract, the right to claim performance rests, as between him and them, with them during their joint lives, and after the death of any of them, with the representative of such deceased person jointly with the survivor or survivors, and after the death of the last survivor, with the representatives of all jointly”.

Example: A, in consideration of Rs 5,00,000 rupees lent to him by B and C, promises B and C jointly to repay them that sum with interest on a specified day but B dies. In such a case right to demand payment shall rest with B’s legal representatives, jointly with C during C’s life-time, and after the death of C, with the legal representatives of B and C jointly.