Contractual obligations of Sole proprietor - legal representatives of a deceased are liable only to extent of estate which they inherit - Even a decree for preventive injunction can also be executed against LR's of deceased judgment-debtor if such a decree is in relation to property or runs with property if there is threat from such LR's.

Citation 

AIR 2024 SUPREME COURT 1386: AIROnline 2024 SC 122

SUPREME COURT

B. V. NAGARATHNA, J. and UJJAL BHUYAN, J.

Civil Appeal Nos. 7768-7769 of 2023, D/-1-3-2024

Vinayak Purshottam Dube (Deceased) Through Lrs. v. Jayashree Padamkar Bhat

(A)Contract Act (9 of 1872), S.37, S.40 - Contractual obligations - Liability of LR's of deceased sole- proprietor LR's of deceased are not liable to discharge obligation which had to be discharged by deceased in his personal capacity But such a position is distinguished from position where estate of deceased would become liable to satisfy decree in monetary terms As proprietorship firm is not separate legal entity as compared to proprietor, his estate would become liable only to satisfy adecree or order in monetary terms, on his demise.

Civil P.C. (5 of 1908), S.2(11) - (Paras 24 27 31)

(B)Civil P.C. (5 of 1908), S.2(11) Legal representative - Liability of 'Legal representative' means a person who in law represents estate of deceased person, and includes any person who intermeddles with estate of deceased and where a party sues or is sued in a representative character person on whom estate devolves on death of party so suing or sued Thus, legal representatives of a deceased are liable only to extent of estate which they inherit. (Para 23)

(C)Contract Act (9 of 1872), S.37, S.40 - Contractual obligations Liability of LR's of deceased-sole proprietor - Even a decree for preventive injunction can also be executed against LR's of deceased judgment-debtor if such a decree is in relation to property or runs with property if there is threat from such LR's.

Civil P.C. (5 of 1908), S.2(11) -

(Para 30)