The Doctrine of Lis Pendens under Section 52 of the Transfer of Property Act, 1882

Introduction

Lis pendens is a Latin term signifying “pending litigation,” which stands as a fundamental principle in property law. Rooted in the legal maxim “pendente lite nihil innovetur“, which translates to “nothing new should be introduced during the pendency of litigation,” this doctrine plays a crucial role in regulating property transactions during ongoing legal disputes. By preventing the transfer or alienation of disputed immovable property while a lawsuit concerning it is pending, lis pendens aims to safeguard the rights and interests of all parties involved in the legal proceedings. This principle ensures that the outcome of the litigation is not rendered futile by the actions of parties seeking to circumvent potential adverse judgments through property transfers.

Legislative Foundation

The doctrine of lis pendens can be formally defined as the jurisdiction, power, or control that a court acquires over property involved in a lawsuit from the moment the action is initiated until a final judgment is rendered. This principle essentially holds that any rights acquired in the subject matter of a suit during its pendency are subordinate to the rights that may be ultimately established by the final decree of the court. In India, this doctrine finds its statutory basis in Section 52 of the Transfer of Property Act, 1882.

Section 52 of the Transfer of Property Act, 1882, lays down the following crucial provision: 

“During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.“

Key terms within this provisions

Pendency of Suits

It states that the pendency commences from the date of the presentation of the plaint or the institution of the proceeding in a court of competent jurisdiction and continues until the suit or proceeding has been disposed of by a final decree or order and the decree has been completely satisfied or discharged. This period encompasses the entire duration of the legal action, from its initiation to its final conclusion and execution.

court having authority

“Court having authority” refers to a court that possesses the appropriate jurisdiction, both pecuniary and territorial, to entertain and adjudicate upon the suit. The litigation must be brought before a court with the proper legal authority to hear the matter. A suit that is instituted in a court lacking the requisite jurisdiction will not trigger the application of the doctrine of lis pendens. For instance, if a suit that should have been filed in a lower court is instead filed in a higher court, the higher court would be considered as lacking the jurisdiction to try the case in the first instance.

suit or proceeding which is not collusive

The phrase “suit or proceeding which is not collusive” emphasizes that the legal action must be genuine and adversarial in nature, rather than a result of a secret agreement or understanding between the parties aimed at defrauding or prejudicing the rights of a third party. Collusion in a judicial proceeding implies a clandestine arrangement between two individuals where one initiates a suit against the other to obtain a judicial decision for a deceitful purpose. In such collusive proceedings, the claim presented is often fictitious, the contest is unreal, and the resulting decree is merely a facade intended to mislead third parties.

any right to immovable property is directly and specifically in question

The condition that “any right to immovable property is directly and specifically in question” signifies that the lawsuit must directly pertain to the title or an interest in a particular immovable property. The core of the litigation must be about the rights to the immovable property itself. Suits that primarily concern monetary claims, such as debts or damages, or those involving movable property, generally fall outside the purview of Section 52, unless the immovable property is directly involved in the enforcement or realization of the decree. For example, a suit solely for the recovery of rent from an agricultural holding would typically not be subject to this section.

transferred or otherwise dealt with

The expression “transferred or otherwise dealt with” encompasses a wide range of actions that a party to the suit might undertake concerning the disputed property. This includes not only formal transfers such as sale, mortgage, lease, exchange, and gift , but also other forms of dealing with the property that could affect the rights of another party. The inclusion of “otherwise dealt with” extends the scope of the section to cover situations not strictly defined as transfers under the Act, such as the partition of property within a Joint Hindu Family.

so as to affect the rights of any other party

The stipulation that the property cannot be dealt with “so as to affect the rights of any other party” highlights that the transfer or dealing must have the potential to prejudice the rights of an opposing party involved in the litigation under any decree or order that the court may ultimately issue. If the action taken by one party concerning the property solely affects their own rights and does not impact the rights of the other party to the suit, the doctrine of lis pendens may not be applicable.

Explanation

The Explanation to Section 52, introduced through the Amendment Act of 1929 , significantly clarified the duration of the pendency of a suit or proceeding. By explicitly stating that pendency continues even during appeals and execution proceedings , the legislature ensured that the restrictive effect of the doctrine remains in force throughout the entire legal process until the final decree is fully satisfied. This amendment addressed potential ambiguities that might have existed earlier regarding the applicability of the doctrine beyond the initial trial stage.

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Essential Conditions for the Application of Section 52

For the doctrine of lis pendens, as embodied in Section 52 of the Transfer of Property Act, 1882, to be applicable, several essential conditions must be satisfied :

1. Pendency of a suit or proceeding: This means that an active lawsuit or legal proceeding concerning the immovable property must be ongoing. The pendency of a suit commences from the date when the plaint is presented or the proceeding is instituted in a court of competent jurisdiction and continues until the suit is finally disposed of by a decree or order, including any appeals and execution proceedings.

In Jayaram Mudaliar v. Ayyaswami AIR 1973 SC 569, where the Supreme Court held that any transfer of property that occurs during the pendency of a suit concerning that property is subject to the final decision of the court.

2. Suit or proceeding must be pending in a Court of competent jurisdiction: The court must have the necessary legal authority, both pecuniary and territorial, to hear and decide the matter. If a suit is instituted in a court that lacks the proper jurisdiction, the doctrine of lis pendens will not apply.

In Rajender Singh v. Santa Singh (1973) 2 SCC 705, the Supreme Court provided a clear definition of lis pendens, stating that it literally means a pending suit and that the doctrine refers to the jurisdiction, power, or control that a court acquires over property involved in a suit from the time the action begins and continues until the final judgment is reached.

3. Right to immovable property must be directly and specifically in question in the suit: The litigation should be directly concerned with the title or an interest in the specific immovable property. Suits that primarily involve monetary claims or movable property, where the immovable property is only incidentally mentioned, generally do not fall under the ambit of Section 52.

The Supreme Court, in A. Nawab John v. V. N. Subramaniyam (2012) 6 SCR 369, clarified a significant aspect of Section 52 by ruling that the doctrine of lis pendens applies even in cases where the transferee of the property is unaware of the ongoing litigation.

4. Suit or proceeding must not be collusive: The legal action must be genuine and not based on a secret agreement or fraudulent understanding between the parties to prejudice the rights of a third party. Collusive suits are specifically excluded from the application of the doctrine.

5. Property in dispute must be transferred or otherwise dealt with by any party to the suit: This includes various forms of transfer such as sale, exchange, lease, mortgage, gift, or any other dealing that affects the rights in the property.

6. Transfer must affect the rights of another party to the litigation: The transfer or dealing with the property must have the potential to impact the rights of the opposing party under any decree or order that may be passed in the suit. If the transfer only affects the rights of the party making the transfer and not those of the other litigant, the doctrine may not be applicable.

7. Transfer must occur during the pendency of the suit:  The transfer or dealing with the property must take place after the suit has been instituted in a competent court and before it has been finally resolved.

These conditions underscore that the doctrine of lis pendens is not a universal bar on all property transfers during any legal proceeding. It is specifically targeted at suits where the immovable property itself is the subject of the dispute, and any transfer has the potential to hinder the court’s ability to render justice effectively. The requirement of a competent court ensures that the doctrine applies within the framework of legitimate legal proceedings, preventing its invocation in frivolous or improperly filed suits.

Bellamy v. Sabine (1857)

In Bellamy v. Sabine, the facts involved a property that Mr. Bellamy had sold to Mr. Sabine. Subsequently, a third party initiated a lawsuit claiming a prior interest in the property. While this litigation was pending, Mr. Sabine, unaware of the lawsuit, sold the property to another individual. 

Issue

The central issue before the court was whether this sale during the pendency of the litigation was valid and whether the purchaser acquired any rights to the property.

Justice Turner, in his observation, articulated the fundamental principle of lis pendens, stating that it was a doctrine common to both courts of law and equity. He emphasized that if property transfers were allowed to prevail during ongoing litigation (pendente lite), it would become virtually impossible for any legal action or suit to be resolved successfully. The court reasoned that if defendants could freely dispose of the property before a judgment was made, plaintiffs would be constantly disadvantaged, being forced to initiate new legal proceedings each time the property changed hands.

Ratio of the case

The principle established in Bellamy v. Sabine is that the doctrine of lis pendens operates not primarily on the basis of notice, whether actual or constructive, to the purchaser, but rather on the ground of necessity to prevent parties engaged in litigation from alienating the property in dispute so as to affect their opponent. A purchaser who acquires an interest in the property pendente lite is bound by the decree that the court may ultimately make against the person from whom they purchased, regardless of whether the purchaser had any notice of the pending suit. The court underscored that the law essentially binds the property itself during the pendency of the litigation.

The Supreme Court’s decision in T.G. Ashok Kumar v. Govindammal & Anr (2010) dealt with a situation where property was transferred during the pendency of a partition suit. The court held that if the title of the party transferring the property during the pendency of the suit (pendente lite transferor) is ultimately upheld by the court, the title of the transferee will not be affected. Conversely, if the transferor’s title is recognized or accepted only with respect to a portion of the transferred property, the transferee’s title will be saved only to that extent. If the pendente lite transferor is found to have no right or title in the property, the transferee will also not acquire any title. This case clarified that transfers made during the pendency of a suit are not automatically void but are subject to the final outcome of the litigation.

Exceptions

1. While the doctrine of lis pendens under Section 52 of the Transfer of Property Act, 1882, is a significant safeguard against property transfers that could impede legal proceedings, Indian courts have recognized certain exceptions and limitations to its applicability.
2. The provision includes an important exception: property can be transferred or otherwise dealt with “except under the authority of the Court and on such terms as it may impose”. This allows the court, in its discretion, to permit a party to transfer or deal with the property during the pendency of the suit, subject to specific conditions that the court deems just and equitable in the circumstances.
3. The doctrine of lis pendens does not apply to suits that do not directly concern the right to immovable property. For instance, suits for the recovery of debts or for damages, where immovable property is only incidentally mentioned or might be attached for the satisfaction of a decree, typically fall outside the scope of Section 52. Similarly, suits for the recovery of rent from agricultural land are generally excluded.
4. Collusive suits are explicitly excluded from the application of the doctrine. Since the purpose of lis pendens is to protect genuine litigants from being prejudiced by transfers made by their opponents, it would be against public policy to extend this protection to suits that are not bona fide but are filed with a fraudulent or collusive intent.
5. The doctrine does not affect the enforcement of pre-existing charges or mortgages. If a property was already subject to a charge or mortgage before the suit was instituted, the rights of the charge-holder or mortgagee to enforce their security are not impeded by the pendency of litigation concerning the property, provided that the transfer resulting from such enforcement is not contested in the suit.
6. In cases where the property in question is unidentifiable or is so misdescribed that its identity cannot be clearly ascertained, the doctrine of lis pendens may not apply. For the doctrine to operate, the suit must involve a right to a specific and identifiable immovable property.
7. A private sale by a mortgagee exercising a power of sale conferred upon them by the mortgage deed is generally not considered to be a transfer that falls within the scope of Section 52, even if a suit for redemption of the mortgage is pending.
8. If the transfer of property during the pendency of a suit does not affect the rights of the other party to the litigation, Section 52 may not be applicable. The doctrine is intended to prevent transfers that could prejudice the rights of the opposing party under a potential decree.
9. In some instances, courts have exercised their discretion to exempt a property from the application of lis pendens if the party seeking to transfer the property furnishes adequate security to protect the interests of the other party involved in the litigation. The Supreme Court’s decision in Vinod Seth v. Devinder Bajaj is a notable example where the court exempted the suit property from the doctrine’s application upon the furnishing of security.
10. Revenue sales, which are conducted under the provisions of revenue recovery laws for the purpose of recovering government dues, might be considered an exception to the doctrine in certain circumstances, particularly when the sale is to recover taxes or other dues owed to the government.
11. If the suit is merely for a bare injunction and does not directly involve a question of title to the immovable property, the doctrine of lis pendens might not be attracted.