doctrine of tacking
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This article is authored by Magaonkar Revati, from the Dayanand College of Law. This article is elaborately dealing with the doctrine of tacking under the Transfer of Property Act and deals with its all provisions briefly.

Introduction

This particular doctrine deals with such matters when the owner of the immovable property mortgages his property with others to secure different advances made for it. So it includes and deals with cases when the same property has been mortgaged repeatedly or subsequently. Tacking is an ability of a lender to secure further advances or new loans under the same existing security which ranks in priority to any amounts subsequently lent by and secured in favour of another lender.

Meaning of the term “tacking”

It is a process where an individual is in adverse possession of any real property and adds his or her period of possession to the priority over the adverse possessor.

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The factual meaning of the term tacking is sewing – any long loose temporary stitches used in the process of dressmaking. 

It is a legal concept that arises under the common law for competing priorities between two or more security interests arising out of the same property.

According to Blacks Law Dictionary tacking is, “the joining of consecutive periods of possession by different persons to treat the periods as one continuous period; especially the adding of one’s period of land possession to that of a prior possessor to establish continuous adverse possession for the statutory period.”

Its meaning can be explained by giving an example:

‘A’ bank gave the first advance to the borrower by taking a mortgage of his property as security. The mortgage is articulated for the security of the advances or any future advances.

‘B’ bank afterwards lent more money to that borrower and took a second-ranking mortgage for the same property.

‘A’ bank then lends subsequently a second advance to that borrower, relying on the original mortgage for security.

So the bank ‘A’ will always have the priority for claiming against the property for recovery of the total amount of the first advance, but it will have the ability to claim against the property having priority over ‘B’ concerning its second advance only if it is permitted to tack the second advance to the mortgage that was taken at the time of the first advance made.

If bank ‘A’ is not permitted to tack the second advance then the bank ‘B’ can claim the amount it lent to the borrower, so that it will have priority over the bank ‘A’s claim for the second advance.

Concept of the doctrine of tacking

The doctrine of tacking is a concept in which a person who is an owner of immovable property, may mortgage his property with others for security, the repayment of the loans or advance from them or to be advanced. 

This doctrine deals with Section 79 of the Transfer of Property Act in India. As per this statute, if a mortgage is created for the security of future and current or present advancement of money and the maximum is limited, then a subsequent mortgage of the same property shall be adjourned to the prior mortgagee in respect of all the advancement not exceeding the certain maximum limit in case the subsequent mortgagee knows about the prior mortgage.

It may be said fairly that this doctrine survives only in the unjust and much-criticized English rule of tacking.

Instances of this Doctrine

Following are some instances of the Doctrine of Tacking:

  1. ‘X’ may mortgage his immovable property with ‘Y’ for taking a loan. He can mortgage the same property to the other bank or persons for the loan. He can mortgage the same property subsequently with ‘Y’ for new advancement of money. In this case, the rule of priority rests with ‘B’ but only regarding his first advancement. For claiming the second advancement he will not be the priority, so he can claim after the other persons.
  2. If ‘A’ creates a mortgage of his property with ‘B’ for the security of any future loan of thirty thousand rupees and he borrows only half of the said amount and afterwards ‘A’ goes to ‘C’ and mortgages the same property with ‘C’ knowing the prior mortgage. Thereafter, ‘A’ goes and borrows the remaining half amount from ‘B’. Later at the time of realisation ‘C’ cannot say or ask that ‘B’ should only claim the first half and the other half of him can only be settled down after the advancement made by ‘C’.

Section 93 of Transfer of Property Act, 1882: prohibition of tacking

Section 93 of the Transfer of Property Act deals with the prohibition of tacking. The wording of this section is as follows:

“No mortgagee paying off a prior mortgage, whether with or without notice of an intermediate mortgage, shall thereby acquire any priority in respect of his original security; and except in the case provided for by Section 79, no mortgagee making a subsequent advance to the mortgagor, whether with or without notice of an intermediate mortgage, shall thereby acquire any priority in respect of his security for such subsequent advance.”

Related case laws

Kakinada Vidyut Employee’s v. Smt. M. Sulochnana Devi on 13 June 2007

This second appeal is filed against the decree and judgment of the appellate court which circumvented the reason, that the appellate court had not considered the oral and documentary evidence submitted by the defendants in a proper perspective and the second question and whether the third defendant has perfected the title by adverse possession including the facts and circumstances of the case.

In this case, the learned counsel contended that by long possession the doctrine of tacking has to be applied in the facts of the present case. As the plaintiffs’ rights have been barred by the limitation of the time and are unable to establish the present suit so the relief granted cannot be continued.

The learned counsel for defendant-plaintiff submitted that even in the light of specific point laid down by both the first and second defendant the question of the plea of adverse possession may not be applicable because the main stand taken as they were not co-owners at that point of time but the name of the father of plaintiff Madura Venkat Reddy had been shown in the sale deed.

The learned counsel also pointed out that the first sale transaction was done in the year 1969 and till 1979, no further action was taken but after the purchase was done by Ramgopal Luhani. Kakinada made serious attempts about certain construction regarding employees of the co-operative house building because of that the only option before the respondent-plaintiff was to institute a suit.

As the specific stand was taken on the document of sale deed which only showed the name of the father and as it was observed and navigated by both the courts specifically it cannot be disturbed in the second appeal, therefore, the learned counsel said while concluding that this second appeal deserves to be dismissed. 

Plaintiff contended that the said property was enjoyed as equal rights of co-ownership by the Sathiaraju Sarabhavya and others. It was purchased with equal advancement of money from the first defendant and Venkatareddy; so after his death, his intestate property and an undivided half share of the land was devolved to his only heir and widow mother but the plaintiff was also in joint possession and enjoyment of the land. 

So the plaintiff’s mother became the full owner of the property under the Hindu Succession Act, 1956. After her death, the plaintiff through her husband asked the defendant for partition but he (defendant) was postponing and was promising to do it later. Tt passed six months but he was escaping all the time. 

The plaintiff came to know that all defendants had created fraudulent documents with wrong intentions of gain by causing loss to the plaintiff. The plaintiff registered notice for partition, they filed a written statement denying the joint share out of the purchase of property and other allegations were denied falsely.

The defendant sold the property on consideration by giving false statements and showing fraudulent documents that he was only in possession of the said property. 

Hence, plaintiff instituted the current suit with all promptness and within time and when a sale deed stands in the names of two persons both parties are entitled to equal shares. The court considered the opinion that the second appeal is devoid of merit and stand dismissed. 

Sushilabai and Ors. v. Laxman on 2 August 1995

Here, in this case, the appellants are striking the proprietary, correctness, and legality of the decree passed by the Additional Judge to District Court Judge, Indore.

The plaintiff herein contended that the respondent Laxman has not proved that he became the owner of the property by adverse possession and the first appellate court had made an error of law while concluding that respondent had inherited property of Saibai under Section 15(1)(d) of Hindu Succession Act, 1956 and made a reference to Section 93 of Transfer of Property Act and submitted that Doctrine of Tacking does not apply.

The first appellate court had held that the doctrine of tacking is applicable in the present case and the respondent had inherited the said property of Saibai.

But it had been revealed by the evidence that Saibai had gifted the suit property to the deceased Krishnarao, to whom the appellants are representing as the legal heirs. Saibai later filed the suit for cancellation of the said gift deed but a decision came confirming the said gift deed in favour of Krishnarao, however, he became the owner of said property. It was also revealed that he was in the possession of said property till his death.

So because of this evidence, Saibai did not have property and property owned by Krishnarao till 1961. Saibai could have had the suit property adverse to the ownership of the appellant from 1961 to 1968.

Court held that the first appellate court had not considered the above important point and had misled himself. He had misapplied the doctrine of talking about the evidence on record.

Conclusion

Therefore, the doctrine of tacking is one of the specific subjects of law used in the money lending transaction while mortgaging the property. Any adverse possessor can use this doctrine for a better title. The tacking is also prohibited and has been abolished under the Transfer of Property Act and also has been repealed by the Amendment Act of 1929.

So the doctrine of tacking gives options to the borrower to take advancement or loans from more than one person and it also provides security to the present and future transactions or advances to be made. Hence it is one of the doctrines which helps the borrower in borrowing loans from more than one person, lender or bank.

References

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