PROJECT ON DOCTRINE OF PRIORITY IN PROPERTY LAW

INTRODUCTION
In recent years determination of the relative rights and priorities of successive
assignees of the same or overlapping rights has been a serious problem for the
Courts. When there are two or more competing equitable interests, the equitable
maxim qui prior est tempore potior est jure (he who is earlier in time is stronger in
law) applies. This means that the first in time prevails over the others. Section 48 of
the Transfer of Property Act embodies this principle in legislation.
Section 48 of the Transfer of Property Act 1882 is established upon the significant
rule that no man can pass on a title than what he has. In the event that an individual
has officially affected an exchange, he can't discredit from his give and manage the
property free from the rights made under the previous exchange. Section48 is an
outright in its terms and does not contain any insurance or reservation for an
ensuing transferee who has no learning of the earlier transfer.
 BASIS OF PRINCIPLE
It is a principle of natural justice that if rights are created in favour of two
persons at different times, the one who has the advantage in time should also
have the advantage in law. This rule, however, applies only to cases where the
conflicting equities are otherwise equal.
Section 48 of the Transfer of Property Act 1882 is founded upon the important
principle that no man can convey a title than what he has. If a person has already
affected a transfer, he cannot derogate from his grant and deal with the property
free from the rights created under the earlier transaction. Section 48 is an
absolute in its terms and does not contain any protection or reservation in favour
of a subsequent transferee who has no knowledge of the prior transfer.
 APPLICABILITY OF THE
RULE
Where the competition is between a mortgagee by deposit of title-deeds and a subsequent
purchaser, the principle embodied in Section 48 is applicable.
Section 48 of the Transfer of Property Act does not admit of any exception.
Case:

In Sitaram v. Rajnarain, Rachpal Singh, J., and Smith, J., have held that the question of priority
between a mortgagee and a subsequent purchaser is governed by Section 48 and is not protected by the
provisions of Sec.41 there is no proof of negligence not the part of the mortgagee.
The right of priority will have to be determined by the combined operation of Section 48 of the Transfer
of Property Act and Sections 47 and 49 of the Registration Act. Any undue emphasis upon Section 49
of the Registration Act in isolation would render nugatory and useless the equally important provisions
in Section 47 of the Registration Act and Section 48 of the Transfer of Property Act. Once the document
is registered, Section 49 of the Registration Act has no relevance and the document takes effect from
the date of its execution by reason of Section 47 of the Registration Act will necessarily have to be
determined in accordance with the rule embodied in Section. 48 of the Transfer of Property Act.
 Qwelty or Equality of
Partition
While effecting a partition of the property belonging to the joint family, it would
not be possible to divide the properties by metes and bounds there being necessity
of an allocation of properties of unequal volumes amongst the members of the joint
family. Properties of larger value might go one member and properties of a smaller
value of another and therefore there would have to be an adjustment of the values:
by providing for the payment by the former of the latter by way of equalization of
their shares. This position has been recognized in law and a provision for such
payment is termed "a provision for owelty or equality of partition."
This provision for owelty is construed as a lien which the co-sharer who is awarded
owelty is deemed to acquire on an excessive allotment of property to the other co-
sharer.
 ESSENTIALS OF
SECTION 48:
•The transferor transfers the rights in the same immovable property.
•At different times – one interest created should be prior in time and another should be
subsequent.
•Such rights created cannot coexist or cannot be enjoyed in full extent together.
•Then, each later right created is subject to the previously created rights.
Provided that, there is no contract to the contrary or reservation binding the earlier transferee
 QUI PRIOR EST TEMPORE
POTIR EST JURE
This rule is based on the maxim Qui prior est tempore potior est jure which stands
for: he who is prior in time is better in law, meaning that the subsequent dealings by
the transferor of the same property cannot prejudice the rights of the transferee of the
same property (prior transferee).

Section 48(1)
This Section deals with the Priority of rights created by transfer (at different times). This provision under
Trasnfer of Property Act, 1882 lays down an important principle of natural justice that the one who has the
advantage in time should also have the advantage in law. This principle, however, only applies to cases where
the conflicting equities of parties involved are otherwise equal. Elaborating on this point, Section 48 simply
confers that no man can convey a title than what he has.
For example- If a person has already set the transfer of the property in motion, he cannot ignore the rights that
were created in an earlier transaction. Section 48 is fair and absolute in its terms. It doesn’t protect or reserve,
in favor of a subsequent transferee, even though he has no knowledge of the previous transfer.
 Illustration :
A mortgage an immovable property to B. As discussed above mortgage allows the transfer of few
rights only. Thus, the remaining rights are still with A. Now A sells, the same property he
mortgaged to B, to C. Thus, all the rights are transferred to C and he will redeem the property.
However, if A mortgages the property to C then he will only transfer the remaining rights and not
the rights already transferred to B.
Section 48(1) also lays down that if there are successive transfers of the same property, the latter
is transferred is subject to the prior transfer.
 EXCEPTIONS TO THE RULE
1) Salvage Charges
An exception to the rule qui prior est tempore is to be found in the salvage charges created on account of advances
made to save the encumbered property from loss or destruction. Such advances are payable in priority to all other
charges of earlier date, and amongst themselves have precedence in the inverse order of their respective dates. On the
same principle, where the court authorises the Receiver to borrow money on a mortgage directing that it should
constitute a first charge on the property, it will take priority over any other mortgage though of an earlier date. But
in order to confer such priority the loan must have been raised for the purpose of preserving the property. If in such a
case the Court even improperly confers priority, of which the mortgagees affected thereby have notice, the order may
hold good against them unless it is set aside.

2) Estoppel
The rule also yields to the equitable principle of estoppel. This, in a case where the first mortgagee was a witness to the
second mortgagee, though there was no actual proof of his knowing the contents thereof, yet, since the presumption is that
he might have known the same, he was postponed to the second encumbrancer. So also, where the registered purchaser
was present when possession was made over to the unregistered purchaser, the former was on that account postpones to the
latter. A party paying off a prior mortgage is not stopped but has a right to use that mortgage as a shield against a
subsequent mortgage if his intention was to keep the prior mortgage alive. No subsequent mortgage is bound in law to give
notice of his encumbrance to the prior encumbrancers. In any case nothing short of estoppels would postpone him to the
subsequent transferee. The rule is same in England, and no rule of Hindu law requires such a notice. Mere absence of
activity on the part of an equitable encumbrancer cannot postpone his encumbrance.
3) By the Registration
An instrument operates from the date of its execution, and it is immaterial that it is compulsorily registrable,
for in that case too, it will operate from the same date. Where two or more deeds are executed on the same day
and the order of their execution cannot be ascertained, all the deeds will take effect at once, and pari passu.
Such a case is analogous to that of a devise to A, and then devise of the same estate to B in a subsequent part
of the will, which will give the estate to A and B either jointly or as tenants in common. Where two deeds
bearing different dates are registered on different days, priority as between them is ascertained with reference
to the dates of the deeds and not with reference to the date on which they were respectively registered; and this
priority is not influenced by the fact that the party having the later deed is in possession of the property. Where
after execution, but before registration, the deed is lost and another had to be executed in its place, the vendor
having between the two dates re-sold the property by a registered deed to another with notice of the prior sale,
it has been held that the first purchaser was entitled to a decree on his sale-deed.

4) By notice
Section 78 enunciates the cases in which the rule of this section would be departed from. Thus, it has been held that
Section 50 of the Registration Act, 1877, did not avoid to give the holder of a subsequent registered deed priority in
respect of his deed over the holder of an earlier unregistered deed not being compulsorily registrable, if in fact, the holder
of the registered deed had, at the time of its execution, notice of the earlier unregistered deed. So where a bona fide
contract, whether oral or written, is made for the sale of property, and a third party, afterwards buys the property with
notice of the prior contract, the title of party claiming under the prior contract prevails against the subsequent purchaser,
although the latter's purchase may have been registered, and although he has obtained possession under this purchase.
 Conclusion
This doctrine is pretty practical in application. The judicial precedents also hold good law. This has expanded
in complexity with the increase in a number of scenarios and still holds good. The exceptions given under
Section 48 are also clear and mostly with regard to other statutes. It is interesting to note that even after so
many statutes of property, Transfer of Property Act was still required to sort of bind the overlapping impact of
these statutes or even the conflicting impact of these statutes through an exception to rules and doctrines.
The question of priority has, therefore, to be determined only with reference to the principle embodied in
Section 48 of the Transfer of Property Act. Section 48 incorporates an important principle that no man can
convey a title better than he himself possessed. If a person has affected a transfer of property, he cannot
thereafter deal with the same property, ignoring to Section 48, the transferor cannot prejudice the rights of the
transferee by any subsequent dealing with the property. This self-evident proposition is expressed in the
equitable maxim qui prior est tempore prior est jure. The section is just an expression of this well-known
common law principle.