Supreme Court clarifies the status of residents in old age homes as licensees: Samarpan Varishtha Jan Parisar vs. Rajendra Prasad Agarwal (2022)

Date of the Judgment: May 6, 2022
Citation: 2022 INSC 447
Judges: Hemant Gupta, J. and V. Ramasubramanian, J.
Can residents of an old age home claim a right to stay there indefinitely? The Supreme Court of India recently addressed this question, clarifying the legal status of residents in old age homes. The Court held that residents are licensees, not tenants, and their right to stay is contingent upon compliance with the rules and regulations of the facility. This judgment has significant implications for the management of old age homes and the rights of their residents. The judgment was delivered by a two-judge bench comprising Justice Hemant Gupta and Justice V. Ramasubramanian.

Case Background

The case involves a dispute between Samarpan Varishtha Jan Parisar, an old age home in Lucknow, and two of its residents, Rajendra Prasad Agarwal and his wife. The Municipal Corporation of Lucknow constructed the old age home, and the appellant was granted a lease to run it. The lease agreement stipulated that the appellant would form an Advisory Board. The old age home had its own set of rules and regulations, which included a clause that allowed the administration to expel any resident who violated the rules, with a one-month notice period. The respondents filled out an admission form on April 23, 2016, agreeing to abide by these rules and regulations.

The old age home administration alleged that the respondents were misbehaving with other inmates and staff. A meeting of the Committee was held on October 26, 2019, where the respondents were given one month’s time to reform their behavior. When no change was observed, the appellant cancelled their membership on November 22, 2019. The respondents then filed a suit for injunction before the Civil Court, seeking to prevent their dispossession from the old age home.

Timeline

Course of Proceedings

The Trial Court initially granted an interim injunction on December 17, 2019, preventing the respondents from being dispossessed during the pendency of the suit. However, this order was vacated by the Court of Additional District Judge, Lucknow, on October 20, 2020. The High Court of Judicature at Allahabad, in a revision petition, set aside the order of the Additional District Judge and restored the interim injunction on October 1, 2021. The appellant then appealed to the Supreme Court.

Legal Framework

The Supreme Court referred to Section 52 of the Indian Easements Act, 1882, to define a license. Section 52 states that a license is the grant of a right to do something on another’s property that would be unlawful without such a right. The Court also distinguished between a lease and a license, stating that a lease creates an interest in the property, whereas a license does not.

Section 52 of the Indian Easements Act, 1882 states:
“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 right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license.”

Arguments

The appellant argued that the residents of the old age home are licensees, not tenants, and therefore, their stay is subject to the rules and regulations of the facility. The appellant contended that the respondents’ behavior was disruptive and that they had the right to terminate their license. The respondents, on the other hand, claimed that they were being unfairly targeted for raising concerns about the financial irregularities and mismanagement at the old age home. They also alleged that they were being subjected to extortion and torture.

The respondents further argued that they had a right to stay in the old age home, especially considering their age and the fact that their children had abandoned them. They also claimed that the old age home was not providing adequate facilities and that they were acting as whistleblowers to highlight the issues.

The innovativeness of the argument lies in the respondents’ attempt to frame their stay as more than a mere license, arguing that their age and circumstances should grant them a more secure right to remain in the old age home. This argument was, however, not accepted by the court.

Issues Framed by the Supreme Court

The Supreme Court framed the following issue:

1. What is the status of the inmates in the old age home? Are they licensees, and/or do they have a right to stay in the old age home for their lifetime as a matter of right?

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Court relied on several judgments to distinguish between a lease and a license and to clarify the rights of a licensee. The authorities are categorized by the legal point they address.

Definition of License and Distinction from Lease:

• Associated Hotels of India v. R.N. Kapoor [AIR 1959 SC 1262] – Supreme Court of India: The Court held that a license is a grant of a right to do something on another’s property that would be unlawful without such a right, while legal possession remains with the owner.
• Sohan Lal Naraindas v. Laxmidas Raghunath Gadit [(1971) 1 SCC 276] – Supreme Court of India: The Court reiterated that a lease creates an interest in the property, whereas a license does not.

Rights of a Licensee:

• Maganlal Radia v. State of Maharashtra [1971 Mh.L.J. 57] – Bombay High Court: The Court held that a licensee has no right to continue in possession after the license expires and that the license is for a temporary purpose.
• Hyderabad Metropolitan Development Authority (HMDA) & Ors. v. M/s. Hotel Malligi Pvt. Ltd. [2017 SCC OnLine Hyd 1] – High Court of Judicature at Hyderabad: The Court stated that a licensee has no right to possession, and the legal possession remains with the licensor. Upon expiry of the license, the licensee’s status becomes that of a trespasser.
• General Merchant Association rep. by Secretary and Treasurer & Ors. v. The Corporation of Chennai, rep. by its Commissioner, Chennai [1998 SCC OnLine Mad 848] – High Court of Judicature at Madras: The Court held that once a license is terminated, the possession of the licensee becomes unlawful.

Possession and Injunction:

• Rame Gowda (Dead) by LRs. v. M. Varadappa Naidu (Dead) by LRs. & Anr. [(2004) 1 SCC 769] – Supreme Court of India: The Court held that a person in peaceful possession is entitled to retain it, even without title, but such possession must be effective, undisturbed, and known to the owner.
• Maria Margarida Sequeira Fernandes & Ors. v. Erasmo Jack De Sequeira (Dead) through LRs [(2012) 5 SCC 370] – Supreme Court of India: The Court held that a caretaker or servant cannot acquire interest in the property, irrespective of long possession.
• Behram Tejani & Ors. v. Azeem Jagani [(2017) 2 SCC 759] – Supreme Court of India: The Court held that a person holding premises gratuitously or as a caretaker does not acquire any right in the property, and long possession in that capacity is of no legal consequence.

Authorities Table

Judgment

The Supreme Court held that the residents of the old age home are licensees, not tenants, and their right to stay is contingent upon compliance with the rules and regulations of the facility. The Court observed that the respondents’ behavior was not conducive to the well-being of the other inmates and the staff of the old age home. The Court also stated that it would not exercise judicial review over the opinion of the appellants regarding the behavior of the respondents.

The Court emphasized that as licensees, the respondents have no legal right to protect their possession without complying with their obligations. Their possession is permissive and not legal, and therefore, they cannot seek an injunction to restrain the management of the old age home from dispossessing them. The Court also noted that the respondents had been offered alternative accommodation.

How each authority was viewed by the Court?

The court used the authorities to establish the legal difference between a lease and a license, and to clarify the rights of a licensee. The court used the authorities to show that a licensee has no right to possession, and the legal possession remains with the licensor. The court further used the authorities to show that a licensee’s possession becomes unlawful after the termination of the license. The authorities were used to establish that a caretaker or a person holding premises gratuitously does not acquire any right in the property.

• Associated Hotels of India v. R.N. Kapoor [AIR 1959 SC 1262]* was used to distinguish between a lease and a license.
• Sohan Lal Naraindas v. Laxmidas Raghunath Gadit [(1971) 1 SCC 276]* was used to reiterate that a lease creates an interest in the property, whereas a license does not.
• Maganlal Radia v. State of Maharashtra [1971 Mh.L.J. 57]* was used to explain that a licensee has no right to continue in possession after the license expires.
• Hyderabad Metropolitan Development Authority (HMDA) & Ors. v. M/s. Hotel Malligi Pvt. Ltd. [2017 SCC OnLine Hyd 1]* was used to clarify that a licensee has no right to possession.
• General Merchant Association rep. by Secretary and Treasurer & Ors. v. The Corporation of Chennai, rep. by its Commissioner, Chennai [1998 SCC OnLine Mad 848]* was used to state that the possession of a licensee becomes unlawful after termination of the license.
• Rame Gowda (Dead) by LRs. v. M. Varadappa Naidu (Dead) by LRs. & Anr. [(2004) 1 SCC 769]* was used to discuss the concept of settled possession and its protection.
• Maria Margarida Sequeira Fernandes & Ors. v. Erasmo Jack De Sequeira (Dead) through LRs [(2012) 5 SCC 370]* was used to hold that a caretaker cannot acquire interest in the property.
• Behram Tejani & Ors. v. Azeem Jagani [(2017) 2 SCC 759]* was used to state that a person holding premises gratuitously does not acquire any right in the property.

What weighed in the mind of the Court?

The Court’s decision was primarily influenced by the legal distinction between a license and a lease. The Court emphasized that the residents of the old age home were licensees, and their right to stay was dependent on adhering to the rules and regulations. The Court also considered the need to maintain a peaceful environment for all residents of the old age home. The Court was also concerned with the fact that the respondents were disrupting the peace of the other inmates in the old age home.

Logical Reasoning:

The Court considered alternative interpretations, such as the respondents being tenants or having a right to stay due to their age and circumstances, but rejected them based on established legal principles. The Court also considered the argument that the respondents were whistleblowers, but did not find it relevant to the legal issue at hand.

The Court’s decision was based on the following reasons:

• The residents of the old age home are licensees, not tenants.
• A license does not create an interest in the property.
• The right to stay is contingent upon compliance with the rules and regulations of the old age home.
• The respondents’ behavior was disruptive to the other inmates and the staff.
• The Court will not exercise judicial review over the opinion of the appellants.
• The respondents have no legal right to protect their possession without complying with their obligations.

The Court quoted the following from the judgment:

“The possession of the respondent nos. 1 and 2 in a room of an old age home is that of a licensee permitted to enjoy the possession, but without creating any interest in the property.”

“As a licensee, the plaintiffs cannot seek an injunction to stay in the old age home unless they allow other inmates, a peaceful co-existence.”

“Therefore, if one parent is the cause of disruption of peace of other inmates in the old age home, the administration of the old age home is at liberty to terminate the license and ask the inmate to vacate the room allotted to them.”

There was no minority opinion in this case.

The Court’s reasoning was based on a strict interpretation of the law and the facts of the case. The Court did not consider the emotional and social aspects of the case, focusing solely on the legal status of the residents.

The decision has potential implications for future cases involving old age homes and the rights of their residents. It clarifies that residents are licensees and not tenants, and their stay is subject to the rules and regulations of the facility. This may lead to more stringent enforcement of rules in old age homes and may make it easier for old age homes to evict residents who violate the rules.

No new doctrines or legal principles were introduced in this judgment.

Key Takeaways

• Residents of old age homes are legally considered licensees, not tenants.
• Their right to stay is conditional on compliance with the rules and regulations of the facility.
• Old age home management has the right to terminate the license of residents who violate the rules.
• Licensees cannot seek an injunction to prevent eviction if they are in violation of the license terms.
• The judgment could lead to more stringent enforcement of rules in old age homes.

Directions

The Supreme Court directed the appellant to arrange an alternative old age home for the respondents, as offered by the Social Welfare Department. The Court also directed the Municipal Corporation or the Social Welfare Department to examine the living conditions of the inmates in the old age home. Additionally, the Court directed the Uttar Pradesh State Legal Services Authority to depute a para-legal volunteer to visit the old age home, and the Member Secretary of the District Legal Services Authority to visit the old age home at least once a month.

Development of Law

The ratio decidendi of the case is that residents of old age homes are licensees and do not have a right to stay indefinitely. This judgment clarifies the legal position of residents in old age homes and does not change the previous position of law, but rather reinforces the existing legal principles related to licenses and leases.

Conclusion

In conclusion, the Supreme Court’s judgment in Samarpan Varishtha Jan Parisar vs. Rajendra Prasad Agarwal clarifies that residents of old age homes are licensees, not tenants, and their stay is subject to the rules and regulations of the facility. This decision reinforces the legal distinction between leases and licenses and has significant implications for the management of old age homes and the rights of their residents. The Court directed the appellant to arrange alternative accommodation for the respondents and also directed the concerned authorities to inspect the living conditions of the old age home and provide legal aid.