Under what circumstances conditional transfer of property under the Transfer of Property Act, 1882 becomes void? Discuss with reference to statutory provisions and case law.

Question: Under what circumstances conditional transfer of property under the Transfer of Property Act, 1882 becomes void? Discuss with reference to statutory provisions and case law. [Punj JS 2003]

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Answer

Section 25 in The Transfer of Property Act, 1882 lays down the provision regarding Conditional transfer. It says:

an interest created on a transfer of property and dependent upon a condition fails if the fulfilment of the condition is impossible, or is forbidden by law, or is of such a nature that, if permitted, it would defeat the provisions of any law, or is fraudulent, or involves or implies injury to the person or property of another, or the Court regards it as immoral or opposed to public policy.

Illustration

(a) A lets a farm to B on condition that he shall walk a hundred miles in an hour. The lease is void.

(b) A gives Rs. 500 to B on condition that he shall marry A’s daughter C. At the date of the transfer, C was dead. The transfer is void.

Thus, below listed are the conditional transfer of property that can render a transfer of property void under the Transfer of Property Act:

1. Impossible to Perform: The transfer is void if the condition is impossible to fulfill, such as requiring something physically or logically impossible. In Rajendra Lal v. Mrinalini Dassi, AIR 1922 Cal 116, the condition in the bequest was that the legatee had to excavate a tank, which in fact was already excavated by the testator himself. Therefore, the condition imposed made the bequest void as the possibility of performing it was impossible.

2. Forbidden by Law: A transfer with conditions that violate any law, whether criminal, civil, or regulatory, is considered void.

3. Injury to Others: Conditions that imply harm to others or the property of others make the transfer void, protecting the rights and interests of third parties.

4. Fraudulent Conditions: If the condition is created with fraudulent intent, such as misrepresentation or deceit, it can void the transfer.

5. Immoral or Against Public Policy: Conditions that go against moral or public policy standards, causing societal harm, can also render the transfer void, promoting ethical and lawful transactions.

In a landmark case of Wilkinson v. Wilkinson, 312 So. 2d 107, the party asked the other party to end the marriage and divorce the husband for the transfer to be completed. It was held that this was an immoral act that violated the other party’s interests. Hence, it was termed void, and the court held it invalid to go through with an act against public policy.