Case Note & Summary
The 1st respondent, R. Krishnamurthy, filed a suit for specific performance of an agreement to sell property No.1236, 3rd Cross, I Block, HAL III Stage, Bangalore, for a total consideration of Rs.10,00,000/-. He claimed that the 1st defendant, H.M. Hamsadevi, as the duly appointed attorney of the 2nd defendant, Munithayappa, entered into the agreement. The trial court decreed the suit in favor of the 1st respondent. The 2nd defendant appealed. The High Court of Karnataka allowed the appeal, holding that the power of attorney must be strictly construed and the attorney cannot bind the principal beyond the express terms of the power. Since the power of attorney did not authorize the sale, the agreement is not binding on the owner. The court set aside the judgment and decree of the trial court and dismissed the suit.
Headnote
A) Specific Performance - Power of Attorney - Authority of Attorney - Strict Construction - The court considered whether an agreement to sell executed by an attorney is binding on the principal when the power of attorney does not expressly authorize the sale. Held that a power of attorney must be strictly construed and the attorney cannot bind the principal beyond the express terms of the power. (Paras 1-5) B) Specific Performance - Agreement to Sell - Binding Nature - The court examined whether the agreement to sell by the attorney was binding on the owner. Held that since the power of attorney did not authorize the sale, the agreement is not binding on the owner. (Paras 1-5)
Issue of Consideration
Whether the 1st defendant, as attorney of the 2nd defendant, had authority to enter into an agreement to sell the property and whether such agreement is binding on the 2nd defendant.
Final Decision
Appeal allowed. The judgment and decree dated 10.01.2011 in O.S.7350/1999 passed by the XI Addl. City Civil Judge, Bangalore City, decreeing the suit for specific performance, is set aside. The suit is dismissed.
Law Points
- Specific performance
- Power of attorney
- Strict construction of power of attorney
- Authority of attorney
- Binding nature of agreement by attorney
