Equitable right to account survives assignment, and residuary limitation applies until the right to sue clearly accrues.
An assignment of the beneficial interest in moneys recovered in administration proceedings was held to carry the assignor's existing equitable right to require an account, so the assignees could enforce that right against the appellants. The claim for an account was not barred by limitation because it was not a simple money claim or a trust claim within the specific limitation provisions; the residuary limitation period applied until the right to sue clearly accrued, and no clear denial of the right was shown. The claim to a one-fourth share in the purchased lands failed for want of any proved partnership or breach of fiduciary duty.
Issues: (i) whether the assignment by R.M.A.T. to the respondents transferred their interest in the moneys recovered in the administration suit and created an enforceable right to an account against the appellants; (ii) whether the respondents' claim for an account was barred by limitation; and (iii) whether the respondents were entitled on the cross-appeal to a one-fourth share in the lands purchased by the appellants.
Issue (i): whether the assignment by R.M.A.T. to the respondents transferred their interest in the moneys recovered in the administration suit and created an enforceable right to an account against the appellants.
Analysis: The assignment was construed as transferring the whole beneficial interest of R.M.A.T. in any money recovered in the administration proceedings, and not merely an interest in the earlier decree that was later set aside. R.M.A.T. had contributed one-fourth of the advances and therefore had an equitable right to require an account when the advances were recovered. The appellants took the assignment of the securities subject to that equitable right, and the respondents, as assignees of R.M.A.T., could enforce the claim.
Conclusion: The right to an account in respect of the recovered moneys vested in the respondents and was enforceable against the appellants.
Issue (ii): whether the respondents' claim for an account was barred by limitation.
Analysis: The claim was not treated as a trust for a specific purpose within Section 10 of the Limitation Act. Article 62 was held inapplicable because the suit was not a simple claim for money received for the plaintiff's use, but an equitable claim requiring account and ascertainment of what was due. The governing provision was Article 120, under which time begins to run only when the right to sue accrues, and no clear denial or infringement of the right was shown.
Conclusion: The claim for an account was not barred by limitation.
Issue (iii): whether the respondents were entitled on the cross-appeal to a one-fourth share in the lands purchased by the appellants.
Analysis: The respondents failed to establish any partnership basis entitling them to a share in the purchased lands. They also failed to show that the appellants, in purchasing the property, had abused any fiduciary position, acted adversely to the respondents' interests, or paid an improper price. The statutory reliance on the Contract Act and Trusts Act did not assist them on the facts found.
Conclusion: The respondents were not entitled to a one-fourth share in the lands.
Final Conclusion: The decree allowing the respondents' claim to an account of the recovered moneys was sustained, but the claim to a share in the lands failed, and both the appeal and cross-appeal were dismissed.
Ratio Decidendi: An assignee takes subject to an existing equitable right to account arising from contributed advances, and a suit for such an account is governed by the residuary limitation rule until the right to sue clearly accrues.
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AI Drafter ✕
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