Original Vendor versus Subsequent Purchaser

When a seller who has agreed to sell his land sells it again to another, a buyer suing for specific performance faces two defendants of very different kinds. The original vendor is the party who made the contract; he is bound by it and cannot escape. The subsequent purchaser is the later buyer who takes from him; he is bound too, under Section 19(b), unless he bought for value, in good faith and without notice. This note explains each in its own right, compares them, and works through an example.

Figure: Original vendor and subsequent purchaser compared, and the chain of enforcement of a decree

1. The Original Vendor in Its Own Right

The original vendor is the party who agreed to sell to the plaintiff. He is bound by the contract as a matter of course, under Section 19(a): he made the bargain, and specific performance runs against him without more. His notice or state of mind is irrelevant, for he knows his own contract; he is the principal defendant, and the decree directs him to convey. He has no escape, because the whole force of the remedy is that a party is held to his promise.

2. The Subsequent Purchaser in Its Own Right

The subsequent purchaser is one who buys the same property from the vendor after the contract with the plaintiff. He is bound by that earlier contract under Section 19(b), because he claims under the vendor by a title arising after it, unless he is a transferee for value who paid in good faith and without notice of the prior contract. Notice, actual or constructive, defeats his defence; and a purchase made during the suit is caught by lis pendens under Section 52 of the Transfer of Property Act, binding him whatever his good faith. He is a necessary or proper party where relief is sought against him, and the decree is framed to direct conveyance by him or the vendor as the case requires.

3. The Two Compared

4. The Chain of Enforcement

5. A Worked Example

Suppose A agrees to sell his plot to B, and then, before completing, sells the same plot to C. B sues for specific performance and joins both A and C. Against A, the original vendor, the decree runs as of course: he made the contract and must convey. Against C, the subsequent purchaser, it depends: if C bought for value, in good faith and without notice of B's agreement, C takes free of it and B is left to his remedy against A; but if C knew of B's agreement, or would have known on due enquiry, or if B was in possession so as to put C on notice, C is bound, and the decree directs the conveyance to B. And if C had bought after B filed the suit, lis pendens would bind C whatever his good faith. The vendor is always caught; the later buyer is caught unless he is truly innocent and bought before suit.

6. Frequently Asked Questions

Q. Is the original vendor always bound by the contract?
A. Yes. He is a party to the contract and specific performance runs against him under Section 19(a); his notice or state of mind is irrelevant.

Q. When is a subsequent purchaser bound?
A. Under Section 19(b), whenever he claims under the vendor by a later title, unless he is a transferee for value who paid in good faith and without notice of the prior contract.

Q. Does a purchase during the suit bind the later buyer?
A. Yes. Under Section 52 of the Transfer of Property Act, a purchase during the pendency of the suit is subject to its result, binding the buyer whatever his good faith.

Q. How is the decree framed against a subsequent purchaser?
A. It directs conveyance by the subsequent purchaser or the vendor as the case requires, so the buyer obtains a good title; the purchaser is a necessary or proper party.