Literal Meaning
A present debt is to be discharged in the future.
Explanation & Origin
Origin – The age old maxim Debitum in praesenti, solvendum in futurois a Latin phrase relating to civil and contract laws, meaning, a debt due in the present is to be paid in the future.
Explanation – The maxim lays down the difference between a case where there is an existing debt, the payment of which is deferred and a case where both debt and its payment rest in the future. The maxim deals with cases where the debt has become due but is payable in the future. The Latin adage Debitum in praesenti, solvendum in futuro establishes the fact- that while an action may be brought on a debt due at present, no action lies in the case if a debt due in future until it becomes due. A debt or obligation is complete when contracted, but of which the performance cannot be required till some future period.
This maxim finds its importance in civil laws relating to debt and indemnity.
Illustration
In case of tenancy the rent of a particular month becomes due at the beginning of the next month, i.e. the rent of the month of January will be due on the 1st of February. But if there exists an agreement and under the agreement of tenancy, rent is payable on the 15th of the following month, the rent for January becomes due on February 1, but is payable on February 15. This shows that the debt has become due but is payable in the future- Debitum in praesenti, solvendum in futuro.
A liability on an unmatured bill of exchange is also an example of a present debt but payable in the future.
An exception to the rule is when a sum is payable upon a contingency does not become a debt until the said contingency has happened. A liability to pay income tax is a present liability though it becomes payable after it is quantified in accordance with ascertainable data.
Case Reference
In the case of Webb v. Stenton[1], the court held, “A debt is a sum of money which is now payabe or will become payable in the future by reason of present obligation.”
A similar opinion was held by the Supreme Court of India in Kesoram Industries and Cotton Mills Ltd. v Commissioner of Wealth Tax (Central) Calcutta[2] where it stated that a debt is a present obligation to pay an ascertainable sum of money, whether the amount is payable in praesenti or in future, debitum in praesenti, solvendum in futuro.
In Leggett v. Bank of Sing Sing[3], it was established that there exists a distinction between debts which will mature for payments in future and contingent liabilities.
In the case of Martin v. Court[4], the plaintiff Martin was the surety for the defendant Court in a bond dated 5th July 1786, with a condition to pay a certain sum of money with interest on 5th July 1786. Court gave Martin an absolute bond, dated 6th July 1786, condition to pay him the same sum of money on 4th July 1787. There was a memorandum endorsed on the back that it was intended as indemnity for the other bond. Court became bankrupt in April 1787 and obtained a certificate for it. Martin brought action of debt on the bond given to him, to which the defendant pleaded his bankruptcy. The Court held that this is an absolute bond payable to the plaintiff at all events; it was debitum in praesenti, solvendum in futuro.
Edited by Vigneshwar Ramasubramania
Approved & Published – Sakshi Raje
[1](1883) 11 QBD 518
[2] 1966 AIR 1370, 1966 SCR (2) 688
[3]24 N.Y. 283. 291
[4]2 T.R. 640. 1788.
