Family Settlement; Sosamma Oomman Vs. Annamma Simon [Kerala High Court, 30-09-2016]

Family Settlement – A family settlement is binding on the members of the family even if one of the parties have not subscribed his signature to the deed. But there should be clinching evidence to show that the party who is not a signatory to the deed has acquiesced in the settlement by his subsequent conduct.

Family Settlement – An unregistered agreement can be treated as a family settlement only if it records past transaction and is complete in itself as regards the rights and liabilities.

# Family Settlement



A.S.No.86 of 2001 & RFA.Nos.376, 377 & 378 of 2004

Dated this the 30th day of September, 2016









Chitambaresh, J.

The brother sets up a ‘family settlement’ in a bid to coerce his siblings to agree for property in lieu of that settled on them by their father.

2. One Oommen Simon died on 7.8.1986 leaving behind his widow, one son and six daughters as his legal heirs who are all parties to O.S.No.79/1989 which is taken as the lead suit. The son is the plaintiff and the widow and daughters are the defendants in the suit which is one for partition and for a direction to execute a deed of conveyance. Such deed is sought to be executed in furtherance of Ext.A1 agreement dated 16.9.1986 conceding to re-partition the property earlier owned by Oommen Simon. The parties are referred to as per their rank in O.S.No.79/1989 which was disposed of along with O.S.Nos.67/1991, 68/1991 and 98/1991 and evidence was recorded in common. Defendant No.7 filed O.S.No.67/1991 for declaration of title and recovery of possession and O.S.No.68/1991 for partition of property. Defendant No.6 filed O.S.No.98/1991 for declaration of title and recovery of possession of property and all the suits were disposed of by the common judgment impugned. The court below has dismissed O.S.No.79/1989 and decreed O.S.Nos.67/1991 and 98/1991 declaring the title and granting recovery of possession. A preliminary decree for partition has also been passed in O.S.No.68/1991 granting 1/6 and 2/21 shares over item No.1 and items Nos.2 and 3 of the plaint schedule property. The plaintiff has come up in appeals and the cardinal issue to be considered in the case is as to whether Ext.A1 agreement could be construed as a ‘family settlement’.

3. We heard Mr.S.V.Balakrishna Iyer, Senior Advocate on behalf of the plaintiff/appellant and Mr.K.P.Satheesan, Senior Advocate on behalf of the defendants/respondents.

4. It is in evidence that Oommen Simon had executed Ext.B8 settlement deed in favour of the defendant No.7 and Ext.B13 settlement deed in favour of the defendant No.6 on 14.5.1985. Oommen Simon had also executed Ext.B11 settlement deed on the same date in favour of defendants 2 to 7 who are his daughters excluding his wife and son. It transpires that Oommen Simon had even earlier executed settlement deeds (Document Nos.2859/1984, 2861/1984 & 2870/1984) in favour of defendants 3, 4 and 5. This is in addition to a settlement deed (Document No.2871/1984) in favour of the plaintiff and his wife and a Will (Document No.III/37/1984) which are not produced. All the above documents have been registered in the office of the Sub Registrar, Adoor within whose jurisdiction Oommen Simon allegedly owned 5 cents of land. Nobody has impeached the settlement deeds hitherto and no evidence has been let in to show that Oommen Simon did not own property at Adoor to enable registration. There is also no plea that the settlement deeds have not been acted upon or that the mutation have not been effected in the revenue records pursuant thereto.

5. It is admitted that defendant No.7 is not a signatory to Ext.A1 agreement and it remains to be adjudged as to how the same would affect her rights prejudicially. The agreement opens by stating that the property requires to be re-partitioned and nothing at all is mentioned about the execution of the settlement deeds and Will referred to earlier. It is also stated therein that the plaintiff deserves to get 84 cents (item No.3 of the plaint schedule property in O.S.No.79/1989) towards his share. The compensation for the acquisition of 1.67 acres (item No.2 of the plaint schedule property in O.S.No.79/1989) is to be divided into eight equal shares for the mother and 7 children. The agreement in addition states that the property of extent 3.18 acres and 1 acre deserves to be allotted to defendant Nos.2 to 7 in equal shares to the exclusion of the plaintiff. There is another clause in the agreement which emphasises the need to pay maintenance to the first defendant apart from her share of the land acquisition compensation. The necessity to solve the financial problem of the third defendant who is not affluent can also be deciphered from a reading of the agreement. The agreement concludes by stating that a registered deed of conveyance has to be executed by the parties with due deference to the terms of Ext.A1 agreement afore-stated.

6. The following are the guiding factors to decide as to whether Ext.A1 agreement is a family settlement or not as held in

# Kale and other v. Deputy Director of Consolidation, AIR 1976 SC 807

(1) The family settlement must be a bona fide one so as to resolve family disputes and rival claims by a fair and equitable division or allotment of properties between the various members or the family;

(2) The said settlement must be voluntary and should not be induced by fraud, coercion or undue influence;

(3) The family arrangements may be even oral in which case no registration is necessary.

(4) It is well settled that registration would be necessary only if the terms of the family arrangement are reduced into writing. Here also, a distinction should be made between a document containing the terms and recitals of a family arrangement made under the document and a mere memorandum prepared after the family arrangement had already been made either for the purpose of the record or for information of the court for making necessary mutation. In such a case the memorandum itself does not create or extinguish any rights in immovable properties and therefore does not fall within the mischief of Section Sec.17(1)(b) of the Registration Act and is, therefore, not compulsorily registrable;

(5) The members who may be parties to the family arrangement must have some antecedent title, claim or interest even a possible claim in the property which is acknowledged by the parties to the settlement. Even if one of the parties to the settlement has no title but under the arrangement the other party relinguishes all its claims or titles in favour of the such a person and acknowledges him to be the sole owner, then the antecedent title must be assumed and the family arrangement will be upheld and the Courts will find no difficulty in giving assent to the same;

(6) Even if bona fide disputes, present or possible, which may not involve legal claims are settled by a bona fide family arrangement which is fair and equitable the family arrangement is final and binding on the parties to the settlement.

(emphasis supplied)

The specific case in the plaint is that the parties to the suit assembled in the house of defendant No.4 on the 41 st day of the death of Oommen Simon and agreed to re-partition the property. The settlement was reduced into writing evidenced by Ext.A1 agreement to which the plaintiff and the defendants except defendant No.7 subscribed their signature. There is no case for the parties that a decision was already taken to repartition the property and that it was recorded in Ext.A1 agreement as a past transaction. The execution of Ext.A1 agreement was contemporaneous with the decision to re-partition the property in supercession of all the earlier deeds. Ext.A1 agreement purporting to extinguish the existing rights and create new rights therefore requires registration under Section 17(1)(b) of the Registration Act, 1908. Ext.A1 agreement on the other hand intends to create right in presenti and the same sans registration has no validity in the eye of law as a family settlement. We are fortified in this view by the decision in

# Tek Bahadur Bhujil v. Debi Singh Bhujil and others, AIR 1966 SC 292

wherein it is held as follows:-

“Family arrangement as such can be arrived at orally. Its terms may be recorded in writing as a memorandum of what had been agreed upon between the parties. The memorandum need not be prepared for the purpose of being used as a document on which future title of the parties be founded. It is usually prepared as a record of what had been agreed upon so that there be no hazy notions about it in future. It is only when the parties reduce the family arrangement in writing with the purpose of using that writing as proof of what they had arranged and, where the arrangement is brought about by the document as such, that the document would require registration as it is then that it would be a document of title declaring for future what rights in what properties the parties possess.”

(emphasis supplied)

Of course an unregistered agreement could be used as a corroborative evidence to explain the subsequent conduct of parties as held in

# Subraya M.N. v. Vittala M.N. And others, 2016 SAR (Civil) 772 (SC)

7. We agree with the proposition that a family settlement is binding on the members of the family even if one of the parties have not subscribed his signature to the deed. But there should be clinching evidence to show that the party who is not a signatory to the deed has acquiesced in the settlement by his subsequent conduct. The decisions in

# Munnalal v. Suraj Bhan and others, AIR 1975 SC 1119


# Narendra Kante v. Anuradha Kante and others, (2010) 2 SCC 77

lend support. There is no such conduct on the part of the defendants to hold that they have acquiesced in the family settlement evidenced by Ext.A1 agreement in order to operate as an estoppel. The mere fact that defendants 3, 4 and 7 signed a cheque for 1,90,278/- on 10.6.1989 in favour of the plaintiff towards his share of the compensation amount has no significance. The same done pending the disposal of O.S.No.79/1989 filed on 5.4.1989 dividing the compensation amount equally between the mother and children was surely a transaction hit by lis pendens. Nothing much turns out on this transaction even though it is stated that the amount was agreed to be divided equally amongst the daughters only under the Will.

8. We also find that the terms in Ext.A1 agreement are inchoate and incomplete as regards the quantum of maintenance to defendant No.1 and the extent of financial support to defendant No.3. The same are yet to be finalised by the parties and moreover Ext.A1 agreement itself stipulates the necessity for a registered conveyance deed. There has also to be a division by metes and bounds of 3.18 acre and 1 acre allotted to defendants 2 to 7 jointly as per the agreement for the lis to end. An unregistered agreement can be treated as a family settlement only if it records past transaction and is complete in itself as regards the rights and liabilities. We are also not impressed by the contention of the plaintiff that defendant No.7 left the place even before the drafting of Ext.A1 agreement was completed. This is so notwithstanding the fact that the presence of defendant No.7 at the place is conceded to by defendant No.6 in her written statement and also in evidence. We find that Ext.A1 agreement falls short of the requisite essentials to hold that the same is a family settlement in supercession of all the earlier deeds.

9. Neither the decree in O.S.No.67/1991 nor the decree in O.S.No.98/1991 can be faulted with since the same is filed by defendant Nos.7 and 6 on the basis of Exts.B8 and B13 settlement deeds. Very little evidence is required to show that a settlement deed in favour of a dependent has been acted upon unless the gift is onerous or burdensome. Equally impeccable is the preliminary decree for partition in O.S.No.68/1991 wherein the personal law has been applied in relation to the 10 cents of land left out in the deeds. The property covered by Ext.B11 settlement deed has been rightly directed to be divided amongst defendants 2 to 7 equally as per the terms thereof. There is no warrant to interfere with the impugned judgment whereby O.S.No.79/1989 is dismissed and O.S.Nos.67/1991, 68/1991 and 98/1991 are decreed.

The Appeal Suit and the Regular First Appeals are dismissed with costs.