Distinguish between "living person" and "existing person" under the Act.

The distinction between a "living person" and an "existing person" under the Transfer of Property Act, 1882 operates across two distinct planes: one governed by section 5 (the domain of valid transferors and transferees) and the other by section 13 read with section 14 (the domain of transfers for unborn persons). The two expressions are not synonymous, and the failure to appreciate the difference between them leads to a misunderstanding of one of the most foundational structural principles of the Act.

The Governing Provisions

Section 5 of the Transfer of Property Act, 1882 defines transfer of property as "an act by which a living person conveys property, in present or in future, to one or more other living persons, or to himself, or to himself and one or more other living persons." The proviso to that section extends the expression: "living person includes a company or association or body of individuals, whether incorporated or not."

Section 13, on the other hand, deals with transfers for the benefit of persons not in existence at the date of the transfer — the so-called "unborn person" — and contemplates the vesting of interest in such a person provided a prior life interest is created in favour of a living person. Section 14 reinforces this by stipulating that no transfer may create an interest to take effect after the lifetime of "one or more persons living at the date of such transfer" and the minority of "some person who shall be in existence at the expiration of that period."

These two sets of provisions thus employ two conceptually distinct expressions: "living person" (section 5) and "person in existence" or "existing person" (sections 13 and 14).

"Living Person" under Section 5

A living person, as used in section 5, is a person who is alive at the date of the transfer in the biological sense, and includes natural persons — human beings who are born and not yet dead — as well as juridical persons created by the fiction of law. Companies, associations, and bodies of individuals, whether incorporated or not, are included in the definition.

The following categories are living persons within section 5:

• A natural human being who is born and alive at the time of transfer

• A registered or unregistered company, association, or body of individuals

• A trust acting through its trustees

The following are not living persons within section 5:

• An idol or deity: though recognised as a juristic person, a dedication of property to a deity falls outside the Act and is governed by religious endowment legislation

• A court: not a juristic person and a court-ordered sale is therefore not a "transfer" under section 5

• An unregistered society or club: the Calcutta High Court held that such a body cannot fall within "living person" within section 5, and its secretary has no legal status to hold property

• A dead person: the Act deals only with inter vivos transfers; a Will does not operate as a transfer within section 5 because it takes effect only after the death of the testator, who by that time has ceased to be a living person

The requirement of "living person" on both sides of the transaction — transferor and transferee — is absolute. Both must be alive and competent at the time of transfer.

"Person in Existence" / "Existing Person" under Sections 13 and 14

The expression "person in existence" in sections 13 and 14 is broader in scope than "living person." It includes not only persons already born (living persons) but also a child in the mother's womb — a child en ventre sa mère — who, though not yet born, is treated as "in existence" by virtue of the civil law fiction that a child conceived is deemed to be born whenever its interests require it.

An unborn person, by contrast, is one who does not yet exist even in the mother's womb — a person contemplated in futuro but not yet conceived. Such a person is neither a "living person" nor a "person in existence."

The scheme of section 13 is thus structured upon this tripartite classification:

1. A living person — already born; can be both transferor and transferee directly

2. A person in existence (child in womb) — can take under section 13 as the unborn beneficiary, being treated as already in existence for the purpose of the transfer

3. An unborn person (not yet conceived) — cannot receive property directly; a transfer can only be made for their benefit under section 13, subject to a prior life interest

The Distinction Summarised

Practical Significance of the Distinction

The distinction matters most in two practical contexts.

First, in a direct transfer under section 5, neither a child in the womb nor an unborn person can be the immediate transferee. A transfer directly to an unborn person is void for want of a competent transferee, and a transfer directly to a child in the womb stands on uncertain footing unless saved by the operation of section 13.

Second, under section 13 and for computing the perpetuity period under section 14, the word "existence" acquires a broader import. The prior life interest required by section 13 must be created in favour of a living person on the date of the transfer; but the ultimate beneficiary (the unborn person) need only come into existence — that is, either be born or be in the womb — before the death of the last person holding the prior life interest. Where the unborn person is merely in womb at the expiry of the prior interest, a period of gestation — normally nine months — is allowed as an additional grace period before the interest must vest.

The settled position under the Act is thus that every living person is a person in existence, but not every person in existence is a living person. A child en ventre sa mère is a person in existence but not a living person in the strict sense required by section 5. This careful demarcation allows the Act to accommodate transfers for the benefit of the yet-unborn within the framework of sections 13 and 14, while restricting direct inter vivos transfers under section 5 exclusively to those who are actually alive at the date of the transaction.