Detail of PRE-EMPTION (SHUFA)

PRE-EMPTION (SHUFA)

PRE-EMPTION (SHUFA)

Shufa means conjunction, here it denotes the right of the owner of a property which is in conjunction-that is adjacent-to another property. Haq means right. So, haq-shufa means right to subsequent purchase of a property adjacent to own from another fresh purchaser. In practice it means a right to dislodge a fresh purchaser and step in his shoes in respect of an adjacent property. It is right to dislodge stranger from entering into ones neighbourhood.

    In all cases the object was, and still is to prevent strangers to a village from becoming sharers in a village, or in a property, where such intrusion by a stranger may be injurious to that society.

Nature of the right of pre-emption

The leading case on the law of pre-emption is Gobind Dayal v. Inayatullah. The observations of Mahmood, J., in this case are still regarded as authority on the subject.

   The law of pre-emption creates a legal servitude running with the land. Sale is not real cause of pre-emption. The real cause is the situation of the properties in question. The right comes into being after the sale, which clearly shows the intention to dispose of the property. The right exists, therefore, independently of and antecedent to the sale.

   The right of pre-emption is not a right to repurchase, but it is a right of substitution, entitling the pre-emptor to stand in the shoes of the purchaser. This view has recently been adopted by the Supreme Court of India in Bishan Singh v. Khazan Singh, where Subha Rao, J., summarised the rules of pre-emption thus:

1)     The right of pre-emption is not a right to the thing sold but a right to the offer of a thing about to be sold. This right is called the primary or inherent right.

2)     The pre-emptor has a secondary right or a remedial right to follow the thing sold.

3)     It is a right of substitution but not of repurchase, i.e., the pre-emptor takes the entire bargain and steps into the shoes of the original vendee.

4)     It is a right to acquire the whole of the property sold and not a share of the property sold.

5)     Preference being the essence of the right, the plaintiff must have a superior right to that of the vendee or the person substituted in his place.

6)     The right being a very weak right, it can be defeated by all legitimate methods, such as the vendee allowing the claimant of a superior or equal right being substituted in his place.

The statement that "it is not a right repurchase" must be understood in its context. It means it is not a case of any repurchase, but a particular subsequent purchase under certain circumstance which compel the fresh buyer to resell. The requisites are:

       (i)   the pre-emptor must be the owner of immovable property in the neighbourhood of the property sold;

      (ii)   there must be a sale of certain property not his own;

    (iii)   the pre-emptor must stand in certain relationship to the vendor in respect of the property sold.

Discussing the nature of the right, Mahmood, J. in Gobind Dayal (supra) shows on the basis of Hedaya that sale is not the cause of pre-emption, it is the situation of the properties in question; at the same time, the right to enforce the pre-emptor's right comes into being after the sale. This means that neither the sale of every property nor the sale to every other person would give rise to the right. As explained later, the right arises only in certain situations. Any action by pre-emptor before actual sale is premature.

   The Supreme Court has accepted that right of  pre-emption is an incident annexed to the property. Although it is essentially a right in rem, from the time it arises only in certain situations. Any action by pre-emptor before actual sale is premature.

   Describing the utility of the right of pre-emption, Mahmood, J., further observed that this right, no doubt, operates as a restriction to the free sale of property, thus diminishing its market value, but its utility outweighs its drawbacks.

Constitutionality of pre-emption

In Bhau Ram v. Baji Nath the Supreme Court held the custom of pre-emption by vicinage, though a liability attached to property, operated as a restriction on the right to dispose of property; not being in public interest, this restriction was not reasonable, moreover, it divided society on the basis of caste and religion, which was prohibited by Article 15 of the Constitution. The same view was maintained in Sant Ram v. labh Singh. The decisions affected only the vicinage type, the co-sharer type custom was unaffected; it had been already recognised in Audh Bihari case (supra).

    In A. Razzaque Bagwan v. Ibrahim Haji Mohd. Husain the right of pre-emption was claimed on the ground of being shafi-i-jar and shafi-i-shareek, having property adjoining to the suit house. The Supreme Court held that the law of pre-emption based on vicinage was void, unconstitutional. The claim was disallowed.

   No right of pre-emption in other transfers.- The right dos not accrue in the following types of alienations of property: Gifts, Sadaqa, Wakf, Inheritance, Bequest, Lease, even though in perpetuity, Mortgage, and Conditional sale.

    The wakif has no right of pre-emption on behalf of the wakf property; nor can God, as the ultimate sovereign and owner of property, claim pre-emption on behalf of the foundation. The conception of God being impleaded as a party in a claim before a Kazi is so foreign to Muslim religion and Muslim jurisprudence that Muslim jurists have nowhere discussed whether a suit can be filed on behalf of God Almighty.

   Sale of leasehold interest in the land does not give rise to the right of pre-emption as held by the Supreme Court in Munnilal v. Bishwanath Prasad.  There must be full ownership in the land pre-empted, and the pre-emptor also must have full ownership to maintain a suit for pre-emption, because reciprocity is the basis of the Muhammadan Law of pre-emption.

Subject-matter of pre-emption

Ordinarily only immovable property can be a subject-matter of pre-emption. Pre-emption must be claimed of the whole of the estate, because otherwise by breaking up the bargain, the pre-emptor would be at liberty to take the best portion of the property and leave the worst part of it with the vendee. The rule would apply to those transactions which, while contained in one deed cannot be  broken up or separated. However, if several distinct properties are sold by one contract, it is not necessary that he should claim all of them, in such a case he may choose one and leave others.

Legal effects of pre-emption

    (i)  When the claim of pre-emption is complete, the pre-emptor steps in the shoes of buyer.

   (ii)  If the sale has been completed when the claim to the right of pre-emption is enforced, the original buyer becomes the new seller, and the pre-emptor as the new buyer.

 (iii)  The pre-emptor does not become liable for any contingent charges incurred by the buyer, such as brokerage or agency.

  (iv)  The buyer is entitled to receive or retain the rents and profits of the land during the interval between the date of its sale to himself, and its transfer to the pre-emptor.

   (v)  As the pre-emptor takes the property from the buyer, and not the seller, the buyer must always be a party to the suit. But after the pre-emptor has taken possession of the land, there is no need of seller.

Loss of the right of pre-emption

The right of pre-emption is lost in the following three ways:

      (i) omission to claim, or waiver;

     (ii) death of pre-emptor before enforcement; and

   (iii) forfeiture of right.