Law: Specific Relief Act, 1877

Section: 9, 39, 42, 54

Law: Contract, Act, 1872

Section: 182, 214, 215

Law: Registration Act, 1908

Section: 17

Law: Qanun-e-Shahadat (10 of 1984)

Section: 17(2)(a)

(a)    Specific Relief Act (I of 1877)---
----Ss. 9, 39, 42 & 54---Suit for declaration, cancellation of documents and possession along with perpetual injunction---Dispute between members of a family over distribution of assets---Family settlement---Purpose and significance of a family settlement and principles governing such settlements stated.
Members of a family descending from a common ancestor or a near relation can make an agreement to settle their dispute and divide their property either orally or in writing to foster peace within the family. A family settlement involves members of the same family striving to resolve their differences and disputes to achieve lasting resolution. Through these arrangements, family members aim to bring about harmony and goodwill, settling conflicting claims or disputed titles to promote peace within the family. Courts recognise the special significance of family arrangements and uphold them when made in good faith. This principle has been developed by courts over a long period of time to discourage litigation driven by greed, particularly in cases involving the distribution of family estates.
The principles governing family settlement or arrangements that may be deduced from case law and the law books may be outlined in the following form:
(i)    The family settlement has to be genuine, bona fide and must aim to resolve family disputes and conflicting claims by ensuring a fair and equitable distribution or allocation of properties among all family members.
(ii)    When an agreement is entered into to preserve the honour of a family and is reasonable, the Court will seize any justifiable reason to enforce the agreement and promote peace within the family.
(iii)    The settlement must be made willingly and should not be influenced by fraud, social or familial pressure, and undue influence.
(iv)    Like an oral contract, family settlements may well also be oral and if it is, no registration of the settlement is necessary.
(v)    It is well established that registration of a family settlement is required only if the terms of the settlement are put into writing. However, it is important to distinguish between a document that includes the terms and details of a family settlement and a simple memorandum created after the arrangement has been made, intended either for record purposes or for informing the Court to effect necessary mutation. In such cases, the memorandum does not create or extinguish any rights in immovable property and, therefore, does not fall under the requirements of the Registration Act, 1908 making it not subject to compulsory registration.
(vi)    In cases where the parties are not inclined to divide property permanently, they cannot be forced to do so. The decision to distribute the property is based on their own preferences, and it is considered a personal and family matter. In such situations, there is no requirement for registering such an agreement.
(vii)    The members involved in the family settlement must have a pre-existing title, claim, or interest, even a potential claim, in the property that is recognised by all parties to the settlement. If one party lacks a title but, under the arrangement, another party relinquishes all claims or titles in favour of that person and acknowledges them as the sole owner, a preexisting title will be assumed. Consequently, the family arrangement will be upheld, and the Courts will readily endorse it.
(viii)    A genuine and bona fide family settlement can resolve disputes, whethercurrent or potential, even if they do not involve legal claims. As long as the arrangement is fair and equitable, it is final and binding on all parties involved.
(ix)    Courts tend to favour maintaining the family arrangement rather than disturbing it on technical or trivial grounds. Where the Courts find that the family arrangement suffers from a legal deficiency or a formal defect, the principle of estoppel is invoked and applied to turn down the plea of the person who, being a party to family arrangement, seeks to set aside a settled dispute, and claims to revoke the family arrangement under which he himself has received some material benefits.
(x)    Family settlements are not governed by principles that apply to dealings between strangers. When deciding the rights of party under the family settlement or claims to upset such settlement, the Court considers what, in the broadest view of the matter, is most for the interests of a family. Matters that would be fatal to the validity of a similar transaction between strangers are not objections to the binding effect of a family settlement or arrangement. [pp. 1998, 2000] B & D
Stapilton v. Stapilton (1558-1774) All ER 352; Gordon v. Gordon (1821) 3 Swans 400; Khunni Lal v. Gobind Krithna Narain (1911) 38 Ind. App. 87; Mt. Hiran Bibi v. Mt. Sohan Bibi AIR 1914 PC 44; Lalla Oudh Beharee Lall v. Ranee Mewa Koonwer (1868) 3 Agra HCR 82 at P.84; Mahomed Musa v. Aghore Kumar Ganguli 28 Ind. cas. 930 (1915); Musammat Hardei v. Bhagwan Singh 24 C.W.N. 105(1919) = 50 Ind. Case 812; Martin Cashin and others v. Peter J. Cashin AIR 1938 PC 103; Tek Bahadur Bhujil v. Debi Singh Bhujil AIR 1966 SC 292; Atta Hussain Khan v. M. Siddiqui Jan 1979 SCMR 630; Anwar Khan v. Abdul Manaf 2004 SCMR 1261; Jahanzeb and others v. Muhammad Abbas 1999 SCMR 2182; Allah Dad v. Duhman Khan 2005 SCMR 564; Honourable Mr. Justice Story, Commentaries on Equity Jurisprudence London: Stevens and Haynes (1892) P.79; Dennis Lane McDonnell John George Monroe, Kerr on the Law of Fraud and
Mistake London: Sweet and Maxwell Limited (1952) P.168; Lord Mackay of Clashfern, Halsbury's Laws of England Fifth Edition, Volume 91 (2012), Para 903 and 906; Dudley Persse v. Henry Persse (1840) VII Clark and Finnelly 279; Jodrell v. Jodrell (1851), 14 Beav. 397 and Hoblyn v. Hoblyn (1889) 41 Ch. D. 200 ref.
(b)    Contract Act (IX of 1872)---
----Ss. 182, 214 & 215---Power of Attorney---Principal and agent---Agent transferring/selling principal s property for his own benefit---Agent, duties of--Agent transferring the principal s property is obligated to firstly, in case of difficulty (and it will be a case of difficulty if a power of attorney is susceptible to doubt about its interpretation), use all reasonable diligence in communicating with the principal and seeking to obtain his instructions---Secondly, if the agent deals on his own account with the property under the agency, e.g., if he purchases it himself or for his own benefit, he, in his own interest, should obtain the consent of the principal in that behalf after acquainting him with all material circumstances on the subject, failing which the principal is at liberty to repudiate the transaction.
Fida Muhammad v. Pir Muhammad Khan (Deceased) through Legal Heirs and another PLD 1985 SC 34; Jamil Akhtar v. Las Baba PLD 2003 SC 494; Muhammad Ashraf v. Muhammad Malik PLD 2008 SC 389; Amina Rani v. Ashfaq Ahmad 2008 SCMR 805 and Mst. Naila Kausar v. Sardar Muhammad Bakhsh 2016 SCMR 1781 ref.
(c)    Registration Act (XVI of 1908)---
----S. 17---Qanun-e-Shahadat (10 of 1984), Art. 17(2)(a)---Family settlement--Whether settlement document required registration and attestation by two witnesses---Held, that in the case at hand, a document detailing the distribution of properties was drafted---This document could be categorized as a family arrangement rather than a standard partition deed---Its contents revealed that the brothers initially reached an oral agreement regarding property distribution, which was then recorded in a memorandum---Property division outlined in the memorandum did not involve transferring property from one brother to another, nor did any brother derive their property rights from another---Instead, the arrangement embodied in the memorandum acknowledged the rights of each brother to specific properties listed under their names---How the properties were to be transferred from one brother to another was verbally settled among the four brothers, and general powers of attorneys were exchanged among all the brothers to give effect to this verbal agreement---Since the memorandum did not constitute a deed of transfer, gift, exchange, surrender, etc., it did not fall under the clauses of Section 17 of the Registration Act, 1908, which require registration---It also did not contain any financial or future obligations requiring attestation by two witnesses as per Article 17 of the Qanun-e-Shahadat, 1984---However, if the settlement were used as a document to create or declare rights in immovable property worth more than Rs.100, it would have needed attestation by two witnesses and also registration---It is important to note that, even though the memorandum was not registered, it was open for either party to prove that there had been a family settlement which was acted upon---Appeal was allowed.
Muhammad Akbar and others v. Province of Punjab through DOR, Lahore and others 2022 SCMR 1532 ref.
Mahmood Ahmad Bhatti, Advocate Supreme Court for Appellants/Applicants (in C.M.A. No.3759 of 2022).
Mudassar Khalid Abbasi, Advocate Supreme Court for Applicants (in C.M.A. No.5618 of 2022).

JUDGMENT
SHAHID WAHEED, J.---The appellants in this direct appeal are the legal heirs of one of the defendants, namely defendant No. 2 who, though succeeded up to the first Appellate Court but, could not secure approval of a decree issued in their favour from the Revision Court. This case, therefore, necessitates a comprehensive review of both the facts and the law. This is essential not only due to the disparity in reasoning between the Revision Court and the first Appellate Court but also because it sheds light on the concerning aspects of our society.

2.    It is a well-established fact that family serves as the fundamental building block of our society, and despite advancements in various aspects of our lives, many business entrepreneurs still continue to uphold the tradition of living in a joint family setting, where the ownership of assets is often unclear. This social structure plays a pivotal role in their accomplishments. However, it is disheartening that such joint families frequently encounter internal conflicts and disagreements, ultimately leading to their disintegration. These disputes often culminate in legal battles, leaving a lingering bitterness among the family members involved. The case at hand is a poignant example of such a situation, where one brother thinks that the family is like a sponge in his hands, to be squeezed for his own benefit. With this lead-in note, we now move on to the details of the dispute, which calls for our decision.

3.    This direct appeal involves a dispute among brothers. Nazir Ahmad, the plaintiff, had three brothers: Muhammad Sharif, Bashir Ahmad (Defendant No.2), and Abdul Rashid (Defendant No.3). Abdul Rashid's daughter, Bilqees Akhtar, was arrayed as defendant No.1 in the suit. It is important to note that Muhammad Sharif was not included in the suit. The brothers jointly and severally owned properties which included: (i) commercial land measuring 46 marlas, situated at Pasrur Road, Daska (Madina Industries), (ii) two commercial plots, 10 marlas each, situated at College Road, near Tank Water Supply No.2, Daska, (iii) two shops comprising land measuring 15 marlas, situated at College Road, Daska, (iv) one plot measuring 1 kanal, situated at College Road, Daska, (v) agricultural land measuring 53 kanals and 17 marlas, situated at Jamke Cheema, Daska, (vi) one plot measuring 12 marlas, situated at Jinnah Road, Gujranwala, and (vi) a house measuring 11 marlas at Zahid Colony, Gujranwala. A feud giving rise to this appeal relates to agricultural land measuring 53 kanals, 17 marlas at Jamke Cheema, Daska. This land was in the name of Nazir Ahmad, the plaintiff, who, in respect of it, constituted his brother Abdul Rashid (Defendant No.3) as his general attorney by a registered power of attorney, dated 15th of August, 2002 (Ex.D.9). Based on that authority, Abdul Rashid, firstly, sold 2 kanals land jointly to Bilqees Akhtar
(Defendant No.1)
and Bashir Ahmad (Defendant No.2) by mutation No.4766 dated 13th of November, 2002 (Ex.P.4), and then on 29th of April, 2003, sold the remaining 51 kanals, 17 marlas jointly to his daughter Bilqees Akhtar and brother Bashir Ahmad by a registered sale deed (Ex.P.3).