In respect of transfer of property, one settled principle is that a person cannot transfer to another person a right or title, which is greater than what he himself possesses. Therefore, a person cannot give what he does not have. However, Transfer of Property Act has provided an exception to this settled principle through concept of ostensible owner.
2. Relevant Provisions
Section 41 of Transfer of Property act 1882 relates to ostensible owner.
3. Meaning of Ostensible Owner
Ostensible ownership means apparent ownership which is derived from conduct or words.
4. Definition of Ostensible Owner
An ostensible owner is one who has all the indicia of ownership without being the real owner.
5. Essentials of section 41
(i) Ostensible Owner
The transfer must be made by ostensible owner.
(ii) Immoveable Property
The property must be immoveable.
The transferor must be ostensible owner with the consent express or implied, of the person interested in the property. The section will not apply unless the ostensible ownership of a person is consented to by the persons interested in the property.
(iii-a) Person interested
A transfer by an ostensible owner is binding only on the person interested in the property with whose consent the transfer has been made.
(iv) Transfer for Consideration
The transfer by ostensible owner must be made for some consideration.
(v) Cannot be avoided by Real Owner
Once the transfer is made by the real owner it cannot be avoided by the real owner.
(vi) Reasonable Care
The transfer must have taken reasonable to ascertain that the transferor had power to make transfer.
(vii) Transfer must not be Voidable
The transfer of property by the ostensible owner must not be voidable. But in must be valid one.
6. Transfer of Property By Ostensible Owner
Following points to explanation it.
(i) Authentic Transfer of Property
When persons, who have interest in immoveable property, give their express or implied consent to some person to transfer this property to another person for some consideration, such transfer of property is not voidable on this ground that transferor was not authorized to make such transfer.
For transfer of property by ostensible owner, it is essential that transferor should be ostensible owner.
(iii) Express or Implied consent of real owner
It is necessary for such transfer that a person should be ostensible owner through express or implied consent of real owner.
For such transfer, it is essential that ostensible owner should transfer immoveable property to another person for some consideration.
(v) Act In Good Faith
It is also necessary for such transfer that transferee should act in good faith by taking reasonable care to ascertain that transferor has power to transfer immoveable property.
To conclude, I can say that section 41 affords protection to bona fide purchasers from ostensible owner, provided its condition is fully satisfied. The rule of ostensible owner is limited to voluntary transfer and does not extend to court sales.