Tag: civil procedure

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Litigation Skills

What’s the issue – Understand why and how courts frame issues in civil suits

JSaiDeepak_OnTrialIt helps to occasionally step back and seek the true meaning of an element of procedure. This is true about the framing of issues in a civil suit since the significance of this step in a trial is often taken for granted.

What is an issue?

The title of Order 14 of the Code of Civil Procedure, 1908 (“CPC”) is “Settlement of Issues and Determination of Suit on Issues of Law or on Issues Agreed Upon”. Clearly, a suit is determined on the basis of issues of law or other issues agreed upon by the parties in a suit. But what is an “issue”? Although the CPC does not define the term, Sub-rule 1 of Rule 1 of Order 14 says that issues arise when a material proposition of fact or law is affirmed by one party and denied by the other. In other words, both parties must disagree on a material proposition of fact or law.

The Evidence Act, 1872 also defines “Facts in issue” to mean and include any fact which, either by itself or in connection with other facts, has a bearing on a right or liability asserted or denied in a suit. According to the explanation to this definition, when a court records an issue of fact under the CPC, the fact to be asserted or denied in response to such an issue would also be treated as a fact in issue.

What is a material proposition giving rise to an issue? Sub-rule 2 of Rule 1 states that material propositions are those propositions of law or facts which a plaintiff must allege in order to show a right to sue or a defendant must allege in order to constitute a defence. Simply put, a material proposition is one that advances a party’s case factually or legally.

Sub-rule 3 mandates that each material proposition on which the parties disagree shall be framed as a distinct issue. Could it be said therefore, that propositions of fact or law which do not further a party’s case are not material and therefore ought not to be framed as issues? What consequences follow when a proposition of fact or law, although material, is not framed as an issue despite the parties being at variance with each other?

On this, the Supreme Court has held that the non-framing of an issue does not vitiate the proceedings as long as the pleadings of parties bear out that the issue exists and both parties have led evidence at trial to prove their respective contentions on the issue. In other words, a court can rule on an issue even if it has not been specifically framed, so long as it is material to the determination of the suit.

The process of framing

How does a court go about framing an issue? Sub-rule 5 of Rule 1 lays down the procedure for this. At the first hearing of a suit, the court shall, after reading the plaint and the written statement, and after examination under Order 10 Rule 2, and after hearing the parties or their counsel, ascertain upon what material propositions of fact or law the parties are at variance, and shall then proceed to frame and record the issues on which the right decision of the case appears to depend.

What does this mean? Simply, that a court has to understand the contentions of the parties from their written pleadings and oral submissions and distill only those propositions of fact and law on which the parties differ and which are “material” for the adjudication of the suit. The question of materiality in Sub-rule 5 has no bearing on the tenability of the contentions of parties on factual or legal propositions. It simply refers to testing an issue for its relevance to the determination of the case.

For instance, in a suit for patent infringement, if there is no dispute between the parties about the plaintiff’s ownership of the patent, there is no point in framing an issue on it. Even though the question of ownership is material, the parties do not disagree on it. Contrast this with a situation where the plaintiff claims to be an assignee of the erstwhile patent owner and the defendant disputes the fact of assignment. The question of ownership or assignment of the patent is material because under the Patents Act, only a patentee or the exclusive licensee may institute a suit for infringement. In other words, the maintainability of the plaintiff’s action is in question. Moreover, since the parties disagree on this material question, the court has to frame an issue on it.

This procedure of framing of an issue needs to be clearly understood. Some people tend to read more into the mere framing of an issue under Order 14 than is warranted. The framing of an issue does not amount to a court taking a position on the contentions of the parties on a material question of fact or law. The court is merely etching the contours of the trial so that the progress of the trial is not waylaid by a slugfest on immaterial issues that have no bearing on the adjudication of the rights and liabilities of the parties. Reading the Supreme Court’s decision in Makhanlal Bangal v. Manas Bhunia (2001), delivered in the context of the Representation of the People Act, 1951, but relevant since the procedure under the CPC applies to the statute, will help clear the fog around the framing of issues.

In the next post, I will deal with the commencement of trial.

Sai Deepak is an engineer-turned-law firm partner-turned-arguing counsel. Sai is the founder of Law Chambers of J. Sai Deepak and appears primarily before the High Court of Delhi and the Supreme Court of India. He is @jsaideepak on Twitter and is the founder of the blawg “The Demanding Mistress” where he writes on economic laws, litigation, and policy. All opinions expressed here are academic and personal.

Categories
Litigation

More tools for litigators after Commercial Courts Act boosts discovery in India

JSaiDeepak_OnTrialI have often heard it lamented that India lacks U.S.-style discovery mechanisms at trial. While I am no expert on U.S. procedural law, I believe that Indian civil procedure contains substantial mechanisms for discovery. Let us now look at the mechanisms available under the Code of Civil Procedure, 1908 (“CPC”) including those recently introduced to the CPC through the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (“Commercial Courts Act“). Employed effectively, they can narrow down the scope of facts and issues that need examination at trial.

Discovery under the CPC

Section 30 of the CPC provides for a court’s power to order discovery. At any time during the conduct of a suit, this provision empowers a court, either of its own motion or on the application of a party, to pass necessary and reasonable orders relating to the delivery and answering of interrogatories; the admission of documents and facts; and the discovery, inspection, production, impounding, and return of documents or other material objects that may be produced as evidence. The provision also empowers a court to issue summons to persons whose attendance is required either to give evidence or to produce documents or other objects that may be led in evidence. A court can also order any fact to be proved by way of an affidavit. While it is commonly assumed that only Order XI of the CPC corresponds to Section 30, Orders XII, XIII, and XVI also contain provisions that relate to Section 30.

What’s the role of a court in discovery proceedings?

The framework that emerges from a combined reading of Section 30 and Orders X, XI, XII, XIII, XVI, and XVIII informs us that the assumption that Indian courts lack powers of discovery because they adhere to the adversarial system of justice may not be true. In Maria Margadia Sequeria v. Erasmo Jack De Sequeria (2012), the Supreme Court, holding that discovery was one of the main purposes of the existence of courts, made some telling observations:

“A judge in the Indian System has to be regarded as failing to exercise its jurisdiction and thereby discharging its judicial duty, if in the guise of remaining neutral, he opts to remain passive to the proceedings before him. He has to always keep in mind that “every trial is a voyage of discovery in which truth is the quest”. In order to bring on record the relevant fact, he has to play an active role; no doubt within the bounds of the statutorily defined procedural law.

41. World over, modern procedural Codes are increasingly relying on full disclosure by the parties. Managerial powers of the Judge are being deployed to ensure that the scope of the factual controversy is minimized.

42. In civil cases, adherence to Section 30 CPC would also help in ascertaining the truth. It seems that this provision which ought to be frequently used is rarely pressed in service by our judicial officers and judges.”

The Court also quoted from the report of the Malimath Committee, which had highlighted the drawbacks in a strictly adversarial system and recommended that courts be statutorily mandated to become active seekers of truth. This fundamental shift in the Indian approach to disputes must be borne in mind when one invokes the mechanisms for discovery. In A. Shanmugam v. Ariya K.R.K.M.N.P.Sangam (2012), the Court, apart from reiterating the ratio of Maria Margadia Sequeria, categorically observed that ensuring discovery and production of documents and a proper admission or denial is imperative for the effective adjudication of civil cases.

Bar raised by Commercial Courts Act

The Commercial Courts Act, 2015 builds on this approach further by introducing an improved discovery mechanism, evident from the language and structure of Rules 1 to 5 in the revised Order XI, which is specific to suits of a commercial nature. The spirit of the revised framework is perhaps best captured by Sub-rule 12 of Rule 1. It unequivocally states that the duty to disclose documents that have come to the notice of the party shall continue until the disposal of the suit. It goes without saying that the reference here is to documents, which are relevant and necessary to decide any question that is germane to the dispute before the court. Critically, both parties are expected to file a list of all relevant documents which are in their power, possession, or control regardless of whether those documents support or undermine their respective positions on merits. Clearly, the bar has been raised under the Commercial Courts Act and both the parties and the courts have access to fairly effective discovery options to facilitate expeditious disposal of suits. The actual employment of these options, of course, remains to be seen.

In the next part of this series, I shall discuss framing of issues and the commencement of trial.

J. Sai Deepak is an engineer-turned-law firm partner-turned-arguing counsel. Sai is the founder of Law Chambers of J. Sai Deepak and appears primarily before the High Court of Delhi and the Supreme Court of India. He is @jsaideepak on Twitter and is the founder of the blawg “The Demanding Mistress” where he writes on economic laws, litigation, and policy. All opinions expressed here are academic and personal.

Categories
Litigation Skills

Know all available interim reliefs but be smart about using them

JSaiDeepak_OnTrialIn my previous post here, I discussed a few important terms from the Code of Civil Procedure, 1908 (“CPC”). That discussion alone illustrates that mechanical compliance with procedural law is not enough. Even though they are regularly described as the handmaidens of justice, procedural legislations are also statutes to which rules of statutory interpretation apply. If you are still not convinced, just talk to some colleagues about some of the most basic terms and clauses in the CPC and you will see for yourself the varied and equally plausible interpretations they can give rise to. Imagine how much trouble the creative interpretation of procedure can cause!

Let us take the case of interim applications. These are applications filed as an adjunct to the primary suit proceeding and may result in interlocutory orders, dismissals of suits, or decrees. If you represent the plaintiff, you will file along with the suit, a host of interim applications — starting from the seemingly mundane applications under Order 13 of the CPC seeking exemption from filing original documents to the important ones seeking urgent ex parte interim reliefs under Order 39 pending disposal of the suit. If you represent the defendant, you will move applications along with your written statement objecting most frequently to the maintainability of the suit on the procedural and substantive grounds under Order 7, Rules 10 and 11. Clearly, while interim applications are expected in theory to proceed in parallel to the suit, more often than not they interfere with the progress of the suit and vice versa.

More interim reliefs in the CPC, Horatio, than are dreamt of in your philosophy

Because of practice and convention, a few interim applications are invoked more often than others. But lawyers cannot afford to limit their knowledge to provisions that they frequently encounter. In fact, what better way to impress a court than to invoke a less-trod procedural provision and to explain to the court the manner in which it should be construed and applied? For instance, when sued by a foreign party that has no immovable property in India, it might help to test waters by drawing the court’s attention to Order 25 of the CPC to require the plaintiff to deposit security in court. This will help you understand the plaintiff’s will to fight to the finish since an order for depositing security casts an additional financial burden on the plaintiff besides the court fee and legal costs it has already incurred.

Another example is Order 13-A of the CPC, introduced recently through the Commercial Courts Act, 2015. It allows a defendant to seek a summary judgment in any commercial dispute if it is able to convince the court that the plaintiff is unlikely to succeed at trial and therefore no need for a protracted conventional trial. The Commercial Courts Act, 2015 is replete with such opportunities because it is designed to reduce frivolous litigation and expedite genuine litigation.

Know when to press a procedural button

That said, it is also important to appreciate the distinction between the theoretical availability of a procedural option at any stage and the appropriateness of invoking it from a strategic perspective. For instance, interrogatories under Order 11 of the CPC allow a party to put factual questions or questions relating to documents with a view to elicit answers which are not evasive. While this mechanism has certain benefits on paper, it gives the other side a peek at the interrogating party’s potential strategy at trial, besides the obvious advantage of answering questions without being under the pressure of cross-examination. Similarly, while it may seem routine to lodge a caveat under Section 148A of the CPC with a view to pre-empt the grant of ex parte orders, it is important to consider how such a course of action may be perceived and the adverse inference that a court may draw. Once again, this is a question of strategy and a litigator has to strike a balance between knowledge of a provision and the advisability of its application.

Substantive legislations also provide for a host of interim applications addressing various aspects of the subject-matter they cover. For instance, on February 5, 2016, a full bench of the Delhi High Court delivered a decision on the application of Section 124 of the Trademarks Act, 1999 under which infringement suit proceedings can be stayed subject to the satisfaction of the conditions under the provision. This decision is being considered by a division bench in a batch of appeals where Section 124 has been commonly invoked. I happen to be arguing in one of the appeals and hopefully, shall be able to write on this issue once there is more clarity.

In the next post, I will discuss discovery proceedings.

J.Sai Deepak, an engineer-turned-litigator, is an Associate Partner in the Litigation Team of NCR-based Saikrishna & Associates. Sai is @jsaideepak on Twitter and is the founder of the blawg “The Demanding Mistress” where he writes on economic laws, litigation and policy. All opinions expressed here are academic and personal.

Categories
Litigation

‘Material facts’, ‘material particulars’ and other common CPC terms that are vital for a trial lawyer

JSaiDeepak_OnTrialThere are some terms that are frequently used in the Code of Civil Procedure, 1908 (“CPC”), and it is important to understand them well because the maintainability of a civil action can depend on your understanding. As you know, the court will not address the merits of a dispute until it is prima facie satisfied about the maintainability of an action.

Cause of action, act, and interest

In Orders 1 and 2 of the CPC, where joinder of parties and causes of actions are discussed among other things, one frequently comes across the terms “cause of action”, “interest”, and “act or transaction”. While Order 1 Rule 1 refers to “acts or transactions”, Order 1 Rule 8, which permits the filing of a representative suit, clarifies in its explanation that those claiming to file a representative suit need only have the “same interest”, they need not have the “same cause of action”. What do these terms mean?

An “act or transaction” is different from “cause of action”. The former gives rise to the latter. An actionable cause arises from an act when the act amounts to the infraction of a party’s right. For instance, selling a patented product without consent is an act which gives rise to a cause of action in favour of the patentee. The same act could also give rise to different causes of action in favour of the same right owner or several right owners. In the example above, the sale of a product could result in infringement of a patent as well as a trademark held by the same individual or could infringe several patents held by unrelated parties.

In contrast to Order 1, Rule 1, which deals with joinder of plaintiffs and Order 1, Rule 3 which deals with joinder of defendants, Order 1, Rule 8,which permits filing of a representative suit, uses the term “interest” to increase the scope for joinder of parties beyond what is provided in Rules 1 and 3. The word “interest” has been used to facilitate adjudication of all questions which arise from the same set of acts or transactions. This provision is intended to avoid multiplicity of litigation where all persons are aggrieved by the same acts or transactions. Importantly, this permits one person to represent all other “interested parties”. For instance, if a host of tenants have an issue with an act or acts of the landlord, instead of filing multiple suits or instead of naming all tenants as parties in one suit, one tenant may represent the rest. Therefore, Rule 8 enlarges the scope of joinder of parties so long as there is a communion of “interest” between the parties.

The distinction between “act or transaction”, “cause of action”, and “interest” affects the maintainability of a civil action. The failure to disclose a prima facie cause of action, for instance, would result in the dismissal of a suit at the outset under Order 7, Rule 11. Similarly, to justify arraying a host of parties as defendants, a plaintiff must set out their relationship inter se, along with their nexus to the transaction which has given rise to the cause of action in favour of the plaintiff against all the defendants. Should the plaintiff fail to justify this, his plaint could be assailed for misjoinder of parties or non-joinder of necessary parties.

Now, let us look at “facts” and “particulars”, two terms that occur frequently in relation to pleadings in Order VI.

Facts, material facts, and material particulars

CPCcontentsOrder VI of the CPC, as discussed earlier, deals with pleadings. It uses the terms “material facts” and “particulars” in different places. Are “material facts” and “particulars” the same? The rules of statutory interpretation and even a common sense understanding of the English language tell us that there is a clear difference. “Facts” refer to the broad matrix or the canvas in the backdrop of which a dispute is contested. “Material facts” are those facts which must find mention in a party’s pleadings in order to establish a claim. “Particulars”, on the other hand, refer to the addition of greater detail to the facts.

The absence of material facts prejudices a party’s case at the outset. The absence of material particulars on the other hand, is curable. The Supreme Court has discussed the distinction between material facts and particulars in Udhav Singh v. Madhav Rao Scindia (1975). In this case, the Court held that “all primary facts which must be proved at the trial by a party to establish the existence of a cause of action or his defence are material facts”. The Court also explained the consequences of the absence of material facts and material particulars.

“The distinction between “material facts” and “material particulars” is important because different consequences may flow from a deficiency of such facts or particulars in the pleading. Failure to plead even a single material fact leads to an incomplete cause of action and incomplete allegations of such a charge are liable to be struck off under Order 6, Rule 16, Code of Civil Procedure.

If the petition is based solely on those allegations which suffer from lack of material facts, the petition is liable to be summarily rejected for want of a cause of action. In the case of a petition suffering from a deficiency of material particulars, the court has discretion to allow the petitioner to supply the required particulars even after the expiry of limitation.”

These terms not only affect the the maintainability of an action, they also influence a party’s prospects at trial when a party is expected to lead evidence with respect to facts in issue. If such facts have not even been pleaded, the party cannot lead evidence to prove such facts. This would necessitate amendment of pleadings under Order 6, Rule 17, which can be a pretty messy affair.

In the next post, I will discuss interim applications under the CPC and the circumstances in which they may be employed.

 J.Sai Deepak, an engineer-turned-litigator, is an Associate Partner in the Litigation Team of NCR-based Saikrishna & Associates. Sai is @jsaideepak on Twitter and is the founder of the blawg “The Demanding Mistress” where he writes on economic laws, litigation and policy. All opinions expressed here are academic and personal.c 

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Litigation Specialised

Where to file suit for copyright infringement? Supreme Court’s purposive interpretation amounts to re-writing the Copyright Act

vijayaraghavannarasimhamA plain reading of Section 62 of the Copyright Act, 1957 will reveal that Section 62(2) of the Copyright Act is an exception to the general rule vesting jurisdiction in a civil court in case of ‘infringement of copyright in any work’.

Under Section 62(1), such a suit has to be instituted before ‘the district court having jurisdiction’ in respect of the ‘infringement of copyright in any work’.

The general rule, seen in Section 20 of the Code of Civil Procedure, 1908 (“CPC”), is that a civil proceeding complaining of ‘infringement’ has to be instituted where the ‘cause of action’, that is, the ‘infringement’ arose, or where the defendants reside or carry on business.

S62CopyrightAct S20CPC

Section 62(2), however, has a non obstante clause vis-a-vis Section 20 of the CPC and any other law in force. Therefore, only Section 62 is invoked to determine whether such a suit is territorially tenable.

Section 62(2) thus makes an exception to Section 62(1). It means that a ‘district court within whose jurisdiction plaintiff resides or carries on business’ is also a place of permissible jurisdiction. This necessarily means that even if the ‘infringement of copyright in a work’ arose within the jurisdiction of Court A, the suit can be filed by the plaintiff in Court B, within whose jurisdiction he resides or carries on business.

Once the plaintiff proves that he was residing at the chosen venue or he was carrying on business there, he can surely sue at that location. The plaintiff need only show that he was ‘actually and voluntarily residing’ there or ‘carrying on business’ or personally working for gain. Once these ingredients are satisfied, the suit has to be held maintainable. In effect, the criteria under Section 20 of the CPC, that is, where the ‘cause of action’ arose or where the ‘defendant was residing’ or ‘carrying on business’ are rendered otiose.

The reasoning behind creating this exception was that an artist must have total control and dominance over his ‘copyright in a work’. The artist has the right to carry his right to sue wherever the artist resides or moves to reside or carries on business or moves to carry on business, irrespective of where the cause of action or infringement arises. It is a clear and lucid departure from the ordinary rule of territorial jurisdiction.

How Sanjay Dalia rewrote the Copyright Act, all in the name of “purpose”

Unfortunately, in one more exhibition of the ‘purposive interpretation’ rule, the Supreme Court has affirmed the decision of the Delhi High Court in Indian Performing Rights Society Ltd. v. Sanjay Dalia.

The plaintiff was carrying on business through a branch office in Delhi though their head office was in Mumbai. The alleged ‘infringement’ had taken place in Mumbai. The concurrent findings of the Delhi High Court declining to entertain the suit in Delhi was affirmed by the top court.

“In our opinion, the provisions of section 62 of the Copyright Act and section 134 of the Trade Marks Act have to be interpreted in the purposive manner. No doubt about it that a suit can be filed by the plaintiff at a place where he is residing or carrying on business or personally works for gain. He need not travel to file a suit to a place where defendant is residing or cause of action wholly or in part arises. However, if the plaintiff is residing or carrying on business etc. at a place where cause of action, wholly or in part, has also arisen, he has to file a suit at that place, as discussed above.”

‘Purposivism’ and ‘consequentialism’ cannot be used to tide over the ‘convenience or inconvenience’ of parties. When the Parliament has conferred on the plaintiff, the right to sue for infringement wherever he resides or carries on business, is the Supreme Court right in concluding that plaintiff could not do so in a case where the infringement arose in Mumbai and defendant carried on business in Mumbai and plaintiff also had its head office? This amounts to re-writing the legislation. Oh, for an Antonin Scalia dissent of the Obamacare and Obergeleff genre.

Vijayaraghavan Narasimhan is an advocate practicing at the Madras High Court.