Almeida v Antao and Another (C.C. 8/1929 (Msa.).) [1930] EACA 46 (1 January 1930)

### ORIGINAL CIVIL.

### Before THOMAS. J.

## MARIANO ALMEIDA by his Attorney Purshottam D. Master $(Plaintiff)$

#### $\overline{v}.$

# (1) CAETANO ROMEO ANTAO and (2) ADELINA SILVA (Mrs. C. Romeo Antao) (Defendants).

### C. C. $8/1929$ (Msa.).

### Validity of a Mortgage Deed which does not comply with the requirements of the law of this Colony.

### Validity of an agreement to pay in Mombasa Rupees.

$Held:$ That the deed is severable, and that although such portions as profess to be a mortgage cannot be enforced there remains the acknowledgment of the debt and the undertaking to pay.

Further held that the expression Mombasa rupees is synonmous<br>with British East Africa Protectorate rupees, and that even<br>assuming that they have ceased to be legal tender it was open<br>to the parties to agree to pay in a cur obsolete.

The deed was entered into between the parties on the 28th January, 1923, at Goa. The following is an extract from the Judgment dealing with the points referred to in the head-note.

$A. B.$ Patel for plaintiff.

Budheo for defendants.

JUDGMENT (dated 9-12-30).

The Deed commences by an acknowledgment that the 11. sum of 3,350 rupees was received as a loan by the defendants in Mombasa. It then provides for interest to be paid at the rate of 5 per cent per annum; for the repayment of the capital amount by instalments of 400 rupees per annum, the first instalment being payable on the 28th January, 1924, and subsequent instalments on the 28th January in each year; and for payments of capital and interest to be made in rupees of Mombasa in Mombasa.

Then follows a statement that for the security of the abovementioned capital, its interest and for whatever stipulated in this document the debtors mortgage their properties in general that they possess and might come in possession in future in Mombasa, British Africa.

It has been argued that the whole Deed is a mortgage $12.$ and that it is headed "Mortgage Deed," and that inasmuch as the Deed does not comply with the requirements of the law in Mombasa or British Africa then the whole document is void.

$13.$ The Deed seems to me to contain two parts. The first being the acknowledgment of indebtedness and a promise to pay principal and interest by instalments. The second part gives security for the payment of the debt.

14. It has been admitted by counsel for the plaintiff that such portions of the Deed as profess to be a mortgage cannot be enforced, in that the mortgage security does not comply with. the law of this Colony.

15. I consider that the Deed is severable, and that after rejecting the part relating to the security (which has not been sued on) there remains the acknowledgment of the debt and the undertaking to pay.

Payment is to be in Mombasa rupees in Mombasa. **16**.

It has been argued that the rupee has been demonetized in Mombasa and therefore payment in such coin cannot be enforced.

17. If such contention be correct then the undertaking to pay in Mombasa rupees would be tantamount to saying that the defendants would never pay.

I find the following in Chitty on Contracts, 17th Edition, page 115.—So where a man, for good consideration, gave a note expressed to be "for money borrowed, which I promise never to pay "the word never was rejected. (Per LORD HARDWICKE, C. Simpson v. Vaughan, 1738, 2 Atk. 32).

But is the Mombasa rupee meaningless? 18.

A rupee was the recognized currency of the Protectorate from 1898. There were silver rupees and later currency notes were issued for varying sums of rupees. (See Order-in-Council, 1905).

The Order-in-Council of 1921 approved of coins of the value of one shilling and by section 2 provided that every contractinvolving the payment of money—shall, in the absence of express agreement to the contrary be deemed to be made-in the Protectorate according to the standard coin. Section 5 substitutes payment in shillings for payment in rupees of any contract made prior to the Order. Section 6 provides for the calling in of coin which has ceased to be legal tender.

There is a further proviso to the Order to the following $effect: \simeq$

" Notwithstanding the revocation of the said Order all coin and all currency notes which at the said date are legal tender thereunder shall, unless and until declared not to be. legal tender, by Proclamation made by the Governor, remain legal tender in accordance with the provisions of the said Order for the amount of their respective denominations at the rate of one rupee or one florin for two shillings."

19. Mombasa is the principal commercial centre of the Protectorate, and in my opinion the expression Mombasa rupee is synonymous with British East Africa Protectorate rupee as provided for in the Order-in-Council of 1905 and the Orders-in-Council amending that Order.

Those rupees remained legal tender after the passing of the Order-in-Council of 1921 and although there was a Proclamation in 1921 relative to silver East Indian coins, the currency notes would still seem to be legal tender. I would refer to Circular No. 56 dated 21-11-30.

But even assuming that they have ceased to be legal tender I can see no objection to the parties agreeing to pay in a currency that has become obsolete and I therefore hold that the contract to pay in rupees of Mombasa, i.e., in Protectorate rupees, is good.

20. The defendant has objected that the first two instalments have been barred by the Act of Limitation. This objection is in my opinion sound and the objection would also hold good as to the interest payable up to the 28th of Janaury, 1926.

There will remain the three instalments and the interest. If these amounts cannot be agreed upon by the parties then I will make an Order for an enquiry to be held as to the exact amounts due in rupees.

In the case of Ali bin Salim v. The British East Africa $21.$ Corporation, Ltd., No. 145 of 1919, MR. JUSTICE PICKERING, now Chief Justice of Zanzibar, found in favour of the plaintiff for the sum of sixty sovereigns and then continued "In my opinion this Court could not properly sell goods under attachment for the realisation of a judgment-debt of sixty sovereigns. Nor in this case could the Court enforce by other means the payment of sovereigns. An alternative form of payment in the local standard coin must be provided in the decree. Upon this point the plaintiff has offered no evidence. He claims the amount of Rupees 900 hitherto paid ". Eventually Judgment was given for the plaintiff for the delivery of sixty sovereigns and/or pounds sterling to the plaintiff or 900 rupees their value.

There is no evidence before me as to the value of the $^{22.}$ rupee. If it be legal tender then its value must be taken at two shillings the sum which has been claimed.

There will be Judgment for the number of rupees agreed $23.$ upon by the parties as suggested in paragraph twenty hereof, or failing such an agreement as may be found on enquiry. And in the alternative for double the number of shillings. The plaintiff to have the costs of the suit to be taxed.