2005 PLP 1982 (CLC)

RAHMAT HUSSAIN JAFFERI, J.

This order will dispose of C.M.A. No.3410 of 2005 filed by the defendant No.2, under Order, VII, rule 11, C.P.C. for rejection of plaint on the grounds that the suit is barred under sections 21, 42, 56 and 58 of Specific Relief Act and do not disclose any cause of action. The plaintiff filed counter-affidavit denying the assertions of defendant No.2.

2. Brief facts of the case are that on 27-4-2005 the plaintiff filed the suit for declaration, specific performance of agreement, permanent and mandatory injunctions. It is stated in the plaint that the plaintiff is a registered partnerships firm and deals in the business of installation, maintenance and rental of advertising billboards. The defendant No.2 is owner of open space in a Plot No.2, C L-8, Abdullah Harroon Road, Saddar, Karachi. He leased out the said plot to the defendant No.1 with the rights to sub-let the same to any other party. The plaintiff approached the defendant No.1 to obtain tenancy of the said land on handsome rent, which was accepted. As such on 18-4-2003 the defendant No.1 sublet the said premises to the plaintiff for two years from 1-5-2003 to 30-4-2005 for erecting an iron structure on the plot facing the traffic coming from Clifton Bridge and proceeding towards Metropole Hotel. The defendant No.1, on the date of agreement put the plaintiff in the possession of the plot and thereafter fixed iron structure of billboard over the property. The defendants 1 and 2 agreed to renew the agreement for one more year from 1-5-2005 to 30-4-2006 at enhanced rent. It is alleged by the plaintiff that on 24-4-2005, the defendant No.1 in collusion with defendant No.2 removed the skin of Ufone of plaintiff's billboard and kept the same in their possession and refused the plaintiff to enter upon the said property. It is further alleged by the plaintiff that the defendant No.2 is required to enforce the agreement and allow the plaintiff to use the same without any interference and that the defendant No.2 had violated the terms of agreement with the result that the plaintiff has suffered irreparable loss in the business hence the suit.

3. After the service of defendant No.2, he filed the present A application on 7-5-2005. I have heard the parties' Advocates and perused the record of this case very carefully.

4. It is well-settled principle of law that while considering an application under Order VII, rule 11, C.P.C. the Court is required to examine the contents of plaint and the admitted documents.

5. Keeping in view the above principle of law, I have examined the contents of plaint and found that the suit property on which the billboard of the plaintiff was erected is owned by the defendant No.2 who had leased out the property to defendant No.1 who had let out the property to the plaintiff for advertising purpose. The plaintiff has filed the agreement executed between the plaintiff and defendant No.1 along with the plaint. This agreement reveals that a Joint-venture Agreement (JVA) was executed between the plaintiff and defendant No.1. It is also mentioned in JVA that the agreement executed between the defendants 1 and 2 was annexed with JVA and that should be considered as part of the same for all intent and purpose. The agreement executed between the defendants 1 and 2 has been filed by the defendant No.2 with his written statement. The same has been admitted by the plaintiff to be the said agreement on the basis of which the defendant No.1 executed JVA. As such, this agreement is an admitted document hence it can be safely relied upon while deciding the present application.

6. A perusal of this agreement reveals that it is a license given by the defendant No.2 to defendant No.1 for advertisement through hoarding. It was executed between the parties on 1-8-2002 under which the defendant No.2 gave license to the defendant No.1 for two years commencing from 1-8-2002 to 31-7-2004 for the above purpose. It appears that JVA was executed between the plaintiff and defendant No.1 for two years commencing from 1-5-2003 to 30-4-2005, during the substance of above mentioned license. It will be noticed that the defendant No.1 had license to use the premises up to 31-7-2004 but this JVA was executed beyond the said period given to the defendant No.1. Nevertheless, it appears that the agreement of license executed between defendants 1 and 2 was rescheduled and was made applicable from 19-4-2003 to 18-4-2005. Even then the JVA executed between defendants 1 and 2 was beyond the period mentioned in the license agreement.

7. The learned Advocate for the plaintiff has emphasized that the agreement executed between the defendants 1 and 2 was lease agreement and was not a license agreement and that the JVA executed between the plaintiff and defendant No.1 was lease agreement therefore, the rights have been transferred from the defendant No.1 to the plaintiff and as such the suit does not hit by any provisions of law.

8. On perusal of these documents viz. JVA and agreement executed between defendants Nos.1 and 2 they clearly show that the defendant No.2 had given a license and provided the space of his land to the defendantNo.1 for advertising through hoarding. The heading of the documents is "License for Advertisement". This document clearly shows B that the defendant No.1 was merely a licensee of the defendant No.2. This document cannot be called a lease deed, therefore, the defendant No.1 cannot be termed as lessee of the defendant No.2. As such, the defendant.No.2 was simply a licensee; therefore, he cannot transfer more rights than the rights, which he himself had in the property. "License" has been defined under section 52 of Easements Act, 1882 that reads as under:-- "52. `License' defined: where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such a right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license."

9. The essential features of license are three folds, which are as under:

(1) A license is not connected with the ownership of any land but creates only a personal right or obligation hence it cannot be assigned. (2) It is purely permissive right arising only by permission, C express or implied, and not by adverse exercise or in any other way, hence it is generally revocable at the will of the grantor. (3) It only legalizes a certain act, which would otherwise be unlawful and does not confer any interest in the property itself in or upon or over which such act is allowed to be done.

10. Thus, a license is a personal right granted to a person to do something upon immoveable property of the grantor, and does net amount to the creation of an interest in the property itself. It is purely a permissible right and is personal to the grantee. It creates no duties and obligations upon the person making the grant and is, therefore, revocable in certain circumstances expressly provided for in the Act itself. The license has no other effect than to confer a privilege, upon the licensee to go upon the land and to do a certain act, which would, in the absence of such license, be unlawful. A reference is invited to a case of Muhammad Khan v. Ranmarayan AIR 1956 Orissa 156. 11. "Lease" has been defined in section 105 of Transfer of Property Act, 1882 that reads as under:- "

105. Lease defined. A lease of immovable property is transfer of a right to enjoy such property, made for a certain time, express or implied; or in perpetuity, in consideration of the price paid or promised, or of money, a share of crops, service of any other thing of value, to be rendered, periodically or on specified occasions to the transfer by the transferee, who accepts the transfer on such terms."

12. The essential feature of the lease is transfer of an interest to enjoy the property with exclusive possession given to the transferee of the premises and conveyed, in consideration of the price paid or promised etc.

13. The cardinal distinction between the lease and the license is that in lease, there is a transfer of an interest in the property to, enjoy it, whereas in the case of license there is no transfer of interest, although the licensee may acquire the right to occupy the land. One of the essential conditions of a tenancy is that the tenant should have the right to the exclusive possession of the premises with transfer of an interest to enjoy the property, while license on the other hand, implies the permission to do some act which without the permission it would be unlawful to do.

14. In deciding whether a grant amounts to a lease or a license pure and simple regard must be had to the substance of the agreement and not to what it purports to be. Since exclusive possession coupled with the transfer of a right to enjoy the property, is the test in determining G whether a grant is a license or a lease, there can be no scope for doubt that when the grantee takes under the grant only the right to use the land without exclusive possession, the right granted is a license and not a lease. A reference is invited to a case of Behari Lal v. Chhote AIR 1933 All. 911.

15. It is pertinent to point out that the license agreement executed between defendants 1 and 2 shows that the defendant No.2 had allowed the defendant No.1 to enter into contractual arrangement with his advertising clients at the sole liability and responsibility of the licensee, the defendant No.1. In pursuance of the above clause in the license agreement the defendant No.1 enter into JVA with the plaintiff. Generally a license which is also known as license of pleasure is founded H in personal confidence and is a purely personal privilege exercised by the grantee himself therefore its exercise cannot be delegated to anybody else as such it can neither be assigned to anybody else nor can it be exercised by the licensee's servants or agents. A reference is invited to 7 M. & W.

67. However, exceptions to the general rule are mentioned in section 56 of Easements Act, 1882. The said section is as follows:-- "

56. License when transferable.

Unless a different intention is expressed or necessarily implied, a license to attend a place of public entertainment may be transferred by the licensee; but, say as the aforesaid, a license cannot be transferred by the licensee or exercised by his servants or agents."

16. Thus, the grantor can also make a license pure and simple assignable as well as exercisable by the servants or agents of the licensee. Such intention of the licensor may be either express or it may be implied from the very constitution of the right granted. Implied intention of the licensor can be gathered from the very nature of the I grant, for example, if the license granted is, by its very nature, not exercisable by the licensee without being exercised by his servants or agents then it will be presumed that the licensor while granting the license, intended that it should be exercised through servants and agents of the licensee.

17. In the present case, the defendant No.2 had allowed the defendant No.1 to enter into contractual arrangement with his clients as such the license was transferable and assignable to his agents. Thus, the plaintiff became agent of the defendant No.1 by virtue of JVA. It is an admitted position that the license period granted to the defendant No.1 by the defendant No.2 has already expired. The learned Advocate for the defendant No.1 has categorically stated that after the expiry of license period he is no more licensee of the defendant No.2. In such a situation, the plaintiffs cannot claim anything against the defendant No.2, as the agency created under JVA was terminated on the day when the defendant No.1 ceased to be licensee of the defendant No.2.

18. As the plaintiff was the agent of defendant No.1 who was the licensee of defendant No.2 through which no right was created in respect of the property in question as such the suit for declaration is hit by section 42 of Specific Relief Act which provides that if any person has a right, title or interest in the property and the same is denied by the other side then the suit is maintainable with consequential relief. As the plaintiff has no right, title or interest in the suit property as such the suit for declaration is not maintainable.

19. As regards the suit for injunction, the plaintiff is also not entitled to claim such injunction on the basis of agent of licensee (which also stands terminated as mentioned above) because no injunction can be granted to a licensee to prevent the revocation of license. A similar point was considered by the Honourable Supreme Court of Pakistan in a case M.A. Nasir v. Chairman Pakistan Eastern Rly. PLD 1965 SC

83. In that l case a catering agreement on railway trains was held to merely confers the right to carry on business of catering in the refreshment rooms and on the Buffet cars under which only a right to use the refreshment rooms were allotted to the contractors for the exclusive purpose of catering refreshments therefore, it was treated as a license and was further held to be revocable at the will of grantor and the revocation thereof cannot be prevented by injunction. As such, the suit for injunction is also not maintainable.

20. As regards the suit for specific performance of contract/ agreement between plaintiff and defendant No.1, it is pointed out that the plaintiff was mere agent of defendant No.1. The license period executed between defendants 1 and 2 had already expired therefore, after the expiry of license given to the defendant No.1, he had no control over the suit property as such the agreement executed between the plaintiff and defendant No.1 cannot be enforced in the present manner. Even otherwise under section 64 of Easements Act a licensee on eviction without his fault and the grant for the consideration is entitled to recover compensation from the grantor. In this case the license executed between the defendants 1 and 2 had expired and it has not been revoked on the conditions mentioned in section 64 of the Easements Act, therefore, in the worst possible case the licensee can only recover compensation from the grantor and no other claim can be filed against the grantor. Thus, the suit for specific performance of contract between the plaintiff and the defendant No.1 is also not maintainable.

21. In the light of what has been discussed above, it is clear that the suit of the plaintiffs is hit by section 42 of Specific Relief Act and the plaintiff has not cause of action to file the present suit, therefore, the plaint is rejected under Order VII, rule 11, C.P.C. The application is allowed with costs. M.B.A./S-135/K Application allowed.