Dr. ZULFIQAR HAIDER vs RIAZ MAHMUD
This matter concerns a petition for leave to appeal arising from a dispute over the specific performance of an oral agreement for the sale of a plot of land. The petitioner agreed to sell a property to the respondent, but subsequently sold a portion of the land to a third party, Faheem-ul-Islam, prior to the initiation of the suit. The trial court decreed the specific performance of the agreement, and the High Court modified this decree, maintaining it only for the remaining portion of the land not sold to the third party. The respondent did not challenge the sale to the third party, which attained finality. The core legal question before the Supreme Court is whether the original agreement for sale remains intact and capable of specific performance despite the inconsistent decree resulting from the partial sale of the property. The Court granted leave to appeal to examine the viability of the specific performance decree under these circumstances and ordered a stay of execution regarding the remaining land pending the final decision of the appeal.
- Can an oral agreement for the sale of land be specifically performed if a portion of the property has already been sold to a third party?
- Does the partial sale of property subject to an agreement for sale render the original agreement incapable of specific performance?
- Is a decree for specific performance maintainable when it is inconsistent with the actual availability of the property due to a prior third-party transfer?
ORDER
1. MUHAMMAD HALEEM, C.J.---There, is a dispute in regard to the decree for specific performance of an oral agreement entered into between the petitioner and the respondent on 13-9-1978. In pursuance of this oral agreement, the petitioner received Rs.40,000 as earnest money out of the sale consideration of Rs.3,00,000.
2. The property agreed to be sold is a plot of land bearing No.16-D, Model Town, Lahore, and measuring 16 kanals and 10 sq. Ft. One of the stipulations of the agreement was that the balance of sale price would be paid within three months and it was only upon the payment of the balance price within three months that the sale-deed would be executed. The respondent sent a notice on 8-9-1979 stating therein that the petitioner had refused to perform the contract as the price had appreciated, and, accordingly, informed him that he would take legal proceedings against him.
3. The petitioner in his reply dated 14-9-1979 stated that the amount had been confiscated as the respondent had failed to pay the balance of the price and to get the sale-deed registered.
4. However, before the dispute arose, the petitioner sold on 18-3-1979 to Faheem-ul-Islam 3 kanals out of the total area of 6 kanals and 10 sq. Ft. Both the petitioner and Faheem-ul-Islam were joined as defendants in the suit filed by the respondent for the specific performance of the oral agreement, which was decreed by the trial Court on 5 of June, 1983. On appeal to the High Court, the decree was partly modified to the extent of 3 kanals only while as to the remaining 3 kanals and 10 sq. Ft., the decree was maintained. The respondent did not file any appeal to challenge the sale in favour of Faheem-ul-Islam of 3 kanals of land which has now assumed finality.
5. The question which arises for consideration is as to whether the original agreement for sale by the inconsistent decree has remained intact which could be specifically performed. Accordingly, leaveth is granted to the petitioner.
6. Security for costs Rs.2,500.
7. In the meantime the execution of the decree -qua 3 kanals 10 sq. Ft. Is stayed till the decision of the appeal.