Bishan Chand v Radha Kishan
Rule established
Seller's non-disclosure of pending litigation affecting title is breach of S.55(1)(a); buyer entitled to rescission
Facts
- Seller sold property without disclosing a pending suit for specific performance by a third party
- Third party's suit succeeded; buyer was evicted
- Buyer sued seller for non-disclosure
Issue
- Whether seller's failure to disclose pending litigation constitutes breach of S.55(1)(a).
Held
- Pending litigation is a material defect in title. The buyer cannot be expected to search court records of every court. Seller's concealment was breach of the implied duty to disclose. Buyer entitled to rescission and refund.
Ratio Decidendi
S.55(1)(a) imposes a duty to disclose material facts affecting title that are: (a) known to seller, (b) not within buyer's knowledge, (c) not discoverable by ordinary care. Court records are not ordinarily searched by buyers; seller must proactively disclose.
How to use it in an exam
Cite for S.55(1)(a) duty to disclose latent title defects. Key line: "Pending litigation affecting title is a material fact requiring disclosure."
Source
Source: AIR 1982 Supreme Court 806
This is an educational summary, not the judgment itself. Cite the reported version in professional or academic work.
Cited in study notes
Sale - Rights and Liabilities of PartiesS.55(1)(a): seller's disclosure duty