Section 26 of the Specific Relief Act, 1963: Rectification of an Instrument and Undue Influence

Section 26 of the Specific Relief Act, 1963 (“Act”) provides the means to rectify a contract or any other instrument which, by mutual mistake or fraud, does not express the real intention of the parties. However, when an agreement provides for the entire subject matter and does not show any sort of ambiguity, applicability of this section will not arise.[1]

On 12^th March, 2013, Supreme Court (“Court”), in Joseph John Peter Sandym (“Appellant”) v. Veronica Thomas Rajkumar & Anr (“Respondent”), had to decide a question concerning the applicability of Section 26 of the Act. In this case, deceased father executed two registered settlement deeds thereby transferring two houses in favour of the appellant and the respondent (“they are siblings”). On an allegation by the appellant that wrong houses have been provided to them, contesting parties executed an “unregistered deed” for exchanging the houses. Since respondent did not give effect to this unregistered deed, appellant filed a suit before the trial court. During the pendency of the suit, father of the contesting parties executed a rectification deed by which allotment of houses to the parties was changed. Following this, decision of the trial court, which was decreed in favour of the appellant, was overruled by the High Court. Against this, appellant filed an appeal before the Supreme Court.

Supreme Court, while determining the scope of Section 26 of the Act, held that it does not have a “general application”, and can be attracted only in a limited number of cases.

“The relief of rectification can be claimed where it   is   through   fraud   or   a   mutual   mistake   of   the  parties   that   real   intention   of   the   parties   is   not   expressed   in  relation to an instrument”[2]

Admissibility of an “unregistered instrument”

While deciding the outcome of the case, court also dealt with the question of admissibility of an unregistered instrument. In doing so, court referred to the case of State of Bihar & Ors. v. Radha Krishna Singh & Ors., AIR 1983 SC 684, wherein it was held that:

“Admissibility of a document is one thing and its probative value quite another - these two aspects cannot be combined. A document may be admissible and yet may not carry any  conviction and weight of its probative value may be nil.”[3]

Onus of “Proof”

In this case, Court was also of the view that onus of proving the validity of an instrument is on the one (“plaintiff”) who produces it, and not on the other party (“defendant”).[4] As far as fiduciary relationship is concerned, the   burden   of   proving   the   absence   of   fraud, misrepresentation   or   undue   influence   is   upon   the   person   in   the dominating position.[5]

Undue Influence

Court also dealt with the issue of undue influence in this case. While doing so, court referred to Afsar Shaikh & Anr v. Soleman Bibi & Ors, AIR 1976 SC 163 wherein the it had laid down the conditions before which one can allege the presence of undue influence.

“..if   a   person   seeking   to   avoid   a  transaction on the ground of undue influence  proves-

(a)   that   the   party   who   had   obtained   the  benefit was, at the material time, in a position to dominate the will of the other conferring  the benefit, and

(b) that the transaction is unconscionable,

the burden shifts on the party benefiting by  the   transaction   to   show   that   it   was   not induced by undue influence. If either of these two conditions is not established the burden will not shift

With regard to undue influence, court, in case of Afsar Shaikh, referred to a judgment of Privy Council wherein it was held that if the transaction appears to be unconscionable, then the burden is on the person exercising dominating will to disprove the existence of undue influence.[6] Burden, in this situation, can be understood as the burden to provide the absence of undue influence. However, the first thing to be considered is the relation of the parties and not the unconscionable transaction.

Outcome of the case

After considering the above positions in relation to Section 26 of the Specific Relief Act, undue influence and onus of proof, Court, in Joseph John Peter Sandym v. Veronica Thomas Rajkumar & Anr, held that there was a presence of undue influence, In support of this, court confirmed the findings of the high court that at the time when exchange deed between the parties was executed, respondent was not married and was dependent on the appellant for sustenance. 

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[1] Subhadra & Ors. v. Thankam,  AIR 2010 SC 3031

[2] Also see State of Karnataka & Anr. v. K. K. Mohandas & etc, AIR 2007 SC 2917

[3] Also see  Madan Mohan Singh &  Ors v. Rajni Kant & Anr, AIR 2010 SC 2933, H.Siddiqui (dead) by Lrs. v. A.Ramalingam AIR 2011 SC 1492; Laxmibai (dead) thr. Lrs. & Anr v. Bhagwantbuva (dead) thr Lrs. & Ors, JT 2013(2) SC 362

[4] See Thiruvengada   Pillai   v.   Navaneethammal   &   Anr,  AIR  2008   SC   1541; K. Laxmanan v. Thekkayil Padmini & Ors., AIR 2009 SC 951

[5] Krishna   Mohan   Kul  v. Pratima Maity & Ors.  AIR 2003 SC 4351

[6] Raghunath Prasad v. Sarju  Prasad,  (AIR 1924 PC 60)