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Tag: CPC

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.

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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.

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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.

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‘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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Order 47, Rule 5 clearer

Order 47 of the Code of Civil Procedure, 1908 (“the CPC”) relates to review. Under Order 47, Rule 1, any person who desires to obtain a review of a decree passed or order made against him, may apply to the court which passed the decree or made the order. It is a special provision which provides that the review application must compulsorily be heard by the same judge or judges who passed the original order. The only exceptions to this rule are those mentioned in the provision itself. It reads as follows:

Where the Judge or Judges, or any one of the Judges, who passed the decree or made the order, a review of which is applied for, continues or continue attached to the Court at the time when the application for a review is presented, and is not or are not precluded by absence or other cause for a period of six months next after the application from considering the decree or order to which the application refers, such Judge or Judges or any of them shall hear the application, and no other Judge or Judges of the Court shall hear the same.

Recently, the Supreme Court in Malthesh Gudda Pooja v. State of Karnataka and Others (Civil Appeal No. 8525 of 2011) dealt with an important question in relation to Order 47, Rule 5 (previously discussed in Anubhav Sinha’s report of a judgment by the High Court of Jharkhand here). Circuit benches have been set up by High Courts in different parts of states. When a judge passes an order sitting in a circuit bench and is then posted back to the principal bench, who will hear the application for review? The dilemma is better explained by referring to the facts in Malthesh Gudda Pooja.

In July 2008, circuit benches of the High Court of Karnataka started functioning at Dharwad and Gulbarga. A certain number of judges from the main bench were chosen by the Chief Justice as per a broad roster to hold sittings for five to six weeks in the circuit benches, followed by other batches of judges. Many a time therefore, a judge who had sat during a particular session of five to six weeks may not sit again in the same circuit bench for more than six months to a year. Further, in case of decisions rendered by division benches, the two judges who constituted the bench may not sit together in the circuit bench again, as they may be posted during different periods before the circuit bench.

In these circumstances, the Registry faced difficulties in listing the review petitions before the circuit bench which heard and disposed of the matters due to the fact that both or one of the judges of the bench would not be available. The Registry therefore, submitted a note dated December 19, 2008 to the Chief Justice seeking directions in that behalf. The Chief Justice made an order that the review petition may be posted as per the roster. A notification in this regard was also issued by the High Court.

These were inter alia the circumstances in which the Supreme Court considered the scope and object of Order 47, Rule 5. Justice R.V. Raveendran, on the eve of his retirement (Octber 11, 2011) pronounced a judgment which goes a long way in clarifying the position in circumstances such as the one mentioned above. Before deciding on the course to be followed in such circumstances however, Justice Raveendran first discussed, precisely, the reason behind the provision.

Justice R.V. Raveendran Image above is from the website of the National Judicial Academy.

Justice R.V. Raveendran
Image above is from the website of the National Judicial Academy.

An application for review is not an appeal or a revision to a superior court, but a request to the same court to recall or reconsider its decision on the limited grounds prescribed for review. The reason for requiring the same judges to hear the application for review is simple. Judges who decided the matter would have heard it at length, applied their mind, and would know best, the facts and legal position in the context of which the decision was rendered. They will be able to appreciate the point in issue, when the grounds for review are raised. If the matter should go before another bench, the judges constituting that bench will look at the matter for the first time and will have to familiarise themselves with the entire case to know whether the grounds for review exist. Further, there is always a chance that the members of the new bench may be influenced by their own perspectives, which need not necessarily be that of the bench which decided the case and there is every likelihood of looking at the matter slightly differently from the manner in which the authors of the judgment looked at it. 

The rule of consistency and finality of decisions therefore, makes it necessary that subject to circumstances which may make it impossible or impractical for the original bench to hear it, the review applications should be considered by the judge or judges who heard and decided the matter or if one of them is not available, at least by a bench consisting of the other judge. It is only where both judges are not available that applications for review will have to be placed before some other bench as there is no alternative. When the judges, or at least one of them who rendered the judgment, continue to be members or member of the court and available to perform normal duties, all efforts should be made to place it before them. This requirement should not be routinely dispensed with.

Thereafter, Justice Raveendran proceeded to discuss whether the wholesome principle behind Order 47, Rule 5 should be dispensed with merely because the judges in question are sitting at the Main Bench, or temporarily at another bench, even though they continue to be attached to the High Court of Karnataka. In this regard, the finding of the Court was as follows:

a. In the interests of justice, and in the interests of consistency in judicial pronouncements and maintaining the good judicial traditions, an effort should always be made for the review application to be heard by the same judges, if they are in the same court.

b. Any attempt to too readily provide for review applications to be heard by any available judge or judges should be discouraged. With the technological innovations available now, we do not see why the review petitions should not be heard by using the medium of video conferencing. An appropriate rule can be made, if such a rule is not already available, for consideration of the application through written submissions alone.

c. The solution may not be to send the review petition to the place where the concerned judges are holding their sitting in view of the fact that such a solution would involve travel, engaging of new counsel, and additional cost, and defeat the very purpose of having circuit benches.

d. Every effort should be made to achieve the object of review by ensuring that the matter is considered by the judge or the bench which rendered the judgment.

From the above finding of the Court, one can arrive at the conclusion that Order 47, Rule 5 is not mandatory but directory although an effort must be made at all times to achieve the object of the provision. However, if there are compelling reasons to deviate from the rule in Order 47, Rule 5, then it may be permissible to do so. However, if the judge or judges are available in the same court, then the provision must be followed and no deviation would be permissible. As regards the suggestion of the Court that review petitions may be heard through video conferencing, I have reservations on the feasibility of this suggestion. There is no harm however, in exploring the same and it would be interesting to see if technology can be used successfully to give effect to provisions of law which are otherwise read down due to impractical situations.

(Rohit Bhat is an advocate at the Supreme Court of India.)

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Foreign custody order

In divorce proceedings, no matter how amicable, the question of custody of children is almost always a bone of contention. This question, intertwined with the question of the welfare of the children, needs to be handled with utmost care. In a recent decision dated July 27, 2011, in Dorothy Thomas v. Rex Arul, Justice V. Ramasubramanian dealt with the issue while deciding a matter relating to the enforcement of a foreign decree.

The plaintiff and the defendant were married in 2005, in Atlanta, U.S.A., and had a child, Rhea Immaculate Arul, who is now three years old. The marriage ran into troubled waters, leading the plaintiff to file a petition for divorce in the Superior Court of Cobb County, State of Georgia, U.S.A. (“the foreign court”). The plaintiff withdrew this petition, and later filed another petition through her counsel in the U.S.A., praying for divorce and for primary custody of the minor child. The plaintiff was in India at the time of filing the second petition. In his counter, the defendant moved a “Motion for Emergency Hearing” relating to the custody of the child, fearing that the plaintiff may settle down in India with the child. The plaintiff stated that she would attend the regular hearing on October 18, 2010. The parties then agreed not to press for an early hearing.

The plaintiff however, did not return for the hearing, and instead requested the dismissal of her petition for divorce, which was done. The defendant proceeded with his counter-claim, and the foreign court passed a final order on November 1, 2010, dissolving the marriage and requiring the plaintiff to return the child to the U.S.A. on or before November 24, 2010. It also granted the defendant sole physical custody of the child with visitation rights to the plaintiff on the fourth weekend of every month.

The plaintiff did not return on the stipulated date and the defendant filed a habeas corpus petition in the same court on December 16, 2010. Despite the service of summons, the plaintiff did not take any steps. By an order dated February 15, 2011, the foreign court issued a writ of habeas corpus directing the plaintiff to deliver the child to the defendant. The defendant also filed a contempt petition on December 10, 2010. The summons was served in India on the plaintiff on January 8, 2011.

The plaintiff did not respond to the summons from the foreign court, which then passed an order on April 12, 2011, directing the plaintiff to return the child on or before May 25, 2011, and stated that if the plaintiff failed to return the child by the designated date, the order itself would serve as an order for incarceration. In view of the resistance on the part of the plaintiff in complying with every order of the foreign Court, a red corner notice was issued through the U.S. Consulate.

After receiving the summons, the plaintiff filed a suit before the Madras High Court, on January 28, 2011, with an application for leave to sue under Clause 12 of the Letters Patent, for an order nullifying the decree of the foreign court, and preventing the defendant from taking steps to enforce the decision relating to the custody of the child. On February 1, 2011, leave was granted.

The main prayer in the suit was for a declaration that the judgment of the foreign court was not binding upon the parties. Section 13 of the Code of Civil Procedure, 1908 (“the CPC”) makes a foreign judgment conclusive as to any matter thereby directly adjudicated between the same parties, while listing out exceptions. Under Section 14 of the CPC, a rebuttable presumption arises that the foreign judgment produced before an Indian court was pronounced by a court of competent jurisdiction.

According to the plaintiff, an attorney-at-law, her life with the defendant became difficult to manage, forcing her to file a petition for divorce. She retracted the petition after her family advised her against it. Based on the belief that her husband had agreed to settle in India, she admitted her child in a school in Chennai. She alleged however, that after she got back to India, her husband began torturing her, leading her to file a second divorce petition through her counsel in the United States. She stated that she could not go for the hearing since she did not have adequate financial resources, and because the defendant did not fund her when she asked him.

The plaintiff made a feeble attempt to assail the decision on the ground that it had no territorial jurisdiction to decide a claim relating to the custody of the child, since the child was in India at the time of the filing. The plaintiff assailed the final order itself on three distinct grounds namely, that it was not given on the merits of the case, that the proceedings were opposed to the principles of natural justice, and that it was obtained by fraud and misrepresentation, staking her claim under clauses (b), (d), and (e) respectively, of Section 13 of the CPC.

Justice Ramasubramanian dismissed the claim refuting jurisdiction, since it was the plaintiff who had fired the first salvo, by filing the petition for divorce before the foreign court, seeking both divorce as well as primary custody of the child. Therefore, the plaintiff could not now question the jurisdiction of that court after she had voluntarily invoked its jurisdiction not once, but twice.

Justice V. Ramasubramanian. Image above taken from the website of the Madras High Court.

Justice V. Ramasubramanian.
Image above taken from the website of the Madras High Court.

The first contention regarding the final order was that the judgment was not given on the merits of the case. It was based primarily upon the fact that even a judgment rendered ex parte is supposed to contain some discussion on the merits. The ground was rejected, since the entire conversation that took place between the judge and the counsel for the defendant during the proceedings in the United States, as well as the oral evidence tendered by the defendant on oath, had been recorded verbatim in the transcript of the proceedings, running to about twenty-six pages. Reasoning that proceedings were not short circuited merely because they were ex parte, the contention that there was no application of mind was held uncharitable. Before winding up, the counsel for the defendant had requested the judge to pass an order that would result in the incarceration of the plaintiff, without the need to file a contempt petition, if she failed to comply with the order for the return of the child. The judge however, refused that prayer and said that the defendant had to file a separate petition for that. The Court held that all of that showed that there had been clear application of mind.

The next ground of attack was that the proceedings before the foreign court were opposed to the rules of natural justice. The plaintiff stated that she did not have notice, either of the intention of the defendant or of the inclination of the foreign court to proceed with the final hearing of the counterclaim made by the defendant. The judge rejected this contention. The plaintiff was the first one to file the case for a divorce before the foreign court. The judge noted that since every case is listed before every court, only with the intention of taking it up for hearing, irrespective of whether it actually happens or not, no client is entitled to think that a case will be listed for hearing on one day and that the court will also put the client on notice of its intention to hear it on that date. Once a case is listed for hearing on a specified date, with the consent of the counsel on both sides, it reflects the intention of the court to take it up for hearing. There is no obligation on the the court to put on notice, a party who fails to appear on the appointed day and who also withdraws her claim on that date.

The third ground on which the plaintiff assailed the order was that the order was obtained by fraud and misrepresentation by the defendant. The plaintiff claimed that she withdrew her petition for divorce on the bona fide belief that the defendant would also be withdrawing his counter claim, and that a misrepresentation had been made to the Court by the defendant that he was not aware of the plaintiff shifting to India. The decision to come to India, according to the plaintiff was consensual. However, the documents filed by the plaintiff suggested that her move to India was a temporary visit, thus, there was no consent by the defendant to a permanent relocation. Further, the plaintiff did not mention the falsity of the defendant’s claim before the foreign court, though she had every opportunity to do so. If there was actually some misrepresentation on the part of the defendant, she had a duty to bring it to the notice of the court whose jurisdiction had been invoked by her and not by the defendant. Therefore, the plaintiff had lost the moral authority to contend that the Court was misled by the defendant through his misrepresentation.

 

 

Arguments about the welfare of the child did not take away from the validity of the foreign judgment. Image above is from Abisekh Sarda's photostream on Flickr.

Arguments about the welfare of the child did not take away from the validity of the foreign judgment.
Image above is from Abisekh Sarda’s photostream on Flickr.

The plaintiff also contended that since the matter related to the custody of a minor child, even if the foreign judgment was taken to be valid, it would at the most serve as a piece of evidence or one of the factors for consideration. She argued that in a case of such a nature, the court may still hold an enquiry into the issue of interest and welfare of the child. According to the plaintiff, all other principles of law would yield to the principle of interest and welfare of the child and that while performing its role of loco parentis, the court would not be fettered by other technicalities of law. The judge however, noted that he was neither dealing with a habeas corpus petition under Article 226 nor with a petition under the Guardians and Wards Act, 1890. The suit prayed for a declaration that a portion of a foreign judgment, unpalatable to the plaintiff, is null and void. The case did not arise under the jurisdiction vested either under Clause 17 of the Letters Patent or under Section 7 of the Guardians and Wards Act, 1890. Thus, while exercising jurisdiction on one side, it is not open to a judge to exercise jurisdiction on another side. The judge however, agreed to consider this issue also, in view of the fact that the ultimate decision would affect a minor child directly.

Throughout the trial, the defendant had expressed unconditional affection towards his child, and clearly showed that he would make any sacrifices necessary for the interest of his child. Documented proof was also available to such effect, in the form of emails and letters. Hence even on considerations of interest and welfare of the child, the judge could not sustain the plea of the plaintiff for continuing the order of injunction.

Consequently, the prayer for interim injunction was rejected, and the plaintiff was directed to move the foreign court within a week of receipt of a copy of the order, praying for a variation or modification of the said order and also praying for recalling the order passed in the contempt petition. Since the procedure of the foreign court permits the filing of petitions through counsel, the plaintiff also had the option of moving the foreign court even from India. In the application so filed, the plaintiff was to tender unconditional apology to the foreign court for violating its orders and give an unequivocal undertaking to appear before it along with the child, provided the defendant purchased tickets for the plaintiff and the child and also took care of the expenses for the stay of the plaintiff and the child in U.S., till the proceedings before that court were concluded. In addition, the order noted that the defendant should also move the same court, either simultaneously or at least within a week of the plaintiff filing the application, expressing his willingness not to press the contempt petition against the plaintiff and also undertaking to purchase the air tickets and take care of the expenses of the plaintiff and the child.

 

(Kirthi Jayakumar is a graduate of the School of Excellence in Law, Chennai.) 

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Determining limitation

In Management of S.E.S. Baba Nebhraj Senior Secondary School v. Smt. Raj Kumari Khanchandani, 181 DLT (2011) 204, the Delhi High Court was posed with the question of whether a tribunal can refer to Section 5 of the Limitation Act, 1963 (“the Limitation Act”) to condone delay in the filing of an appeal when the statute that set up the said tribunal itself provides for a period within which all appeals must be filed before it.

The respondent had been appointed as an assistant teacher in the petitioner school. Thereafter, the services of the respondent were terminated during probation, as her work was found to be unsatisfactory. Aggrieved by the termination, the respondent filed an appeal under the Delhi School Education Act, 1973 (“the DSE Act”), along with an application seeking the condonation of delay.

The tribunal set up under the DSE Act condoned the delay of the respondent under Section 5 of the Limitation Act in filing the appeal beyond the prescribed period of three months. This condonation of delay by the tribunal was challenged by way of the instant writ petition.

Section 5 of the Limitation Act provides as follows:

“Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of 1908) may be admitted after the prescribed period, if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.

Explanation – The fact that the appellant or the applicant was misled by any order, practice or judgment of the High Court in ascertaining or computing the prescribed period may be sufficient cause within the meaning of this section”.

The petitioner argued that Section 5 of the Limitation Act applies only to a court of law, due to the term ‘court’ used in the provision. It was argued that such provisions are not applicable to quasi-judicial bodies or those bodies, which are administrative in nature, or bodies created by statute.

In deciding this issue, the Court referred to Section 11 (6) of the DSE Act.

“The Tribunal shall for the purpose of disposal of an appeal preferred under this Act have the same powers as are vested in a court of appeal by the Code of Civil Procedure, 1908 and shall also have the power to stay the operation of the order appealed against on such terms as it may think fit.”

The Court held that due to the enabling provision in Section 11 (6) of the DSE Act, the tribunal would enjoy the power vested in a court of appeal by the Code of Civil Procedure, 1908, and therefore rejected the argument of the petitioner that the power to condone delay would only vest with a court of law, and not with a tribunal which performs quasi-judicial functions.

The Court further observed that questions of limitation in the case of tribunals would arise in two contexts—(i) where no provision of condonation has been provided for, and (ii) where the statute provides for a negative cap. An example of a negative cap can be seen in Rule 7 (2) of the Employees Provident Fund Appellate Tribunal (Procedure) Rules, 1997 which stipulate that any person aggrieved by an order passed under the Act may, within sixty days from the date of the said order, prefer an appeal to the Provident Fund Tribunal, and that the Tribunal may, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal within the prescribed period, extend that by another period of sixty days. Therefore, a negative cap is a situation where that the statute itself provides for an upper limit to the delay that a tribunal is authorised to condone.

Tick-tock-tick-tock. Image above is from Abode of Chaos's photostream on Flickr.

Tick-tock-tick-tock.
Image above is from Abode of Chaos’s photostream on Flickr.

The Court held that in the situation where a negative cap is present in the statute itself, the delay could not be condoned beyond the prescribed maximum limit. Where there is no clear-cut provision for condonation of delay however, it cannot be read in a manner that would result in injustice or absurdity.

Therefore, the Court held that Section 11 (6) of the DSE Act confers on the tribunal, appellate powers which it exercises as it were a court of appeal, and would have the power to condone the delay in filing of the appeal by taking recourse to Section 5 of the Limitation Act, as no negative cap is provided for in the DSE Act itself.

The import of this judgment is that, if a statute prescribes a period within which an appeal is to be filed within a fixed period of time, and the statute itself provides for a period of condonation of delay, the tribunal will not have the power to condone the delay beyond the condonation period prescribed in the statute, that is, a situation of a negative cap. If the statute merely provides for a period of time within which the appeal must be filed however, but does not provide for a condonation period, the tribunal would then have recourse to Section 5 of the Limitation Act, to condone the said delay.

The judgement is available here.

 

(Aditya Shamlal is a New Delhi-based advocate.)

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Conflict between the CPC and the Evidence Act

In the case of Dinesh Viniyog Limited and Others v. The Oriental Gas Company Limited and OthersG.A. No. 859 of 2009 (2011 AIR CC 1405 (CAL)), the judgement was given by Justices Bhaskar Bhattacharya and Sambuddha Chakrabarti. The brief facts of the case were thus:

The respondents in the appeal had filed an execution application in the Calcutta High Court for execution of a decree and order passed in an English court in favour of the respondents. The appellant filed an objection, saying that the decree and order were not properly certified and that the decree holder had already realised more than the decretal dues by selling certain shares. The Single Judge of the High Court acknowledged the objection and gave the respondents three months time to remedy the same. Pursuant to such direction, the respondents filed the certified order. The appellant objected to the same again. However, the Single Judge rejected such objection and passed an order. The appeal was filed in appeal to the same.

Justice Bhaskar Bhattacharya Image above is from the website of the Calcutta High Court.

Justice Bhaskar Bhattacharya
Image above is from the website of the Calcutta High Court.

The appellants raised two main objections in the instant Letters Patent appeal. At first, it was contended that the purported certificate and the true copy of the order were not in compliance with the Supreme Court Rules, 1965 as applicable in India. It was further contended that there was a binding requirement to comply with Order 71, Rule 13(4) of the aforesaid rules for a judgment to be executed in India. Secondly, it was contended that an interest amount had been levied which was contrary to law and was passed without jurisdiction.

The Court negatived both the contentions of the appellant. With regard to the first contention, the Hon’ble Division Bench was pleased to hold that the purported certificate and true copy of the order passed by the English Court were in compliance with Section 44A of the Code of Civil Procedure, 1908 (“the CPC”) and thus executable in courts of India. Section 44A of the CPC is set out below:

Section 44A: Execution of decrees passed by Courts in reciprocating territory.

(1) Where a certified copy of decree of any of the superior courts of any reciprocating territory has been filed in a District Court, the decree may be executed in India as if it had been passed by the District Court.

(2) Together with the certified copy of the decree shall be filed a certificate from such superior Court stating the extent, if any, to which the decree has been satisfied or adjusted and such certificate shall, for the purposes of proceedings under this section, be conclusive proof of the extent of such satisfaction or adjustment.

(3) The provisions of Section 47 shall as from the filing of the certified copy of the decree apply to the proceedings of a District Court executing a decree under this section, and the District Court shall refuse execution of any such decree, if it is shown to the satisfaction of the Court that the decree falls within any of the exceptions specified in clauses (a) to (f) of section 13.

Explanation 1- “Reciprocating territory” means any country or territory outside India which the Central Government may, by notification in the Official Gazette, declare to be a reciprocating territory for the purposes of this section; and “superior Courts”, with reference to any such territory, means such Courts as may be specified in the said notification.

Explanation 2 – “Decree” with reference to a superior Court means any decree or judgment of such Court under which a sum of money is payable, not being a sum payable in respect of taxes or other charges of a like nature or in respect to a fine or other penalty, but shall in no case include an arbitration award, even if such an award is enforceable as a decree or judgment.

As regards the second contention, the Hon’ble Division Bench stated that appellant should have contested the objection to such interest levied in the appropriate forum in England and the same issue could not be opened or adjudicated in India. However, the appellant failed to do so. The Hon’ble Division Bench, being only the executing court, was bound by the certificate showing interest had been levied.

The first part of the judgment needs a closer scrutiny and consideration. The decision of the Hon’ble court is based purely on the CPC. The Hon’ble division bench, however, failed to take into account Section 82 of the Indian Evidence Act, 1872 (“the Evidence Act”). That section provides for the presumptions to be followed by a court of law with regard to documents which are admissible in England:

Section 82 of the Evidence Act, 1872 states as follows:

Presumption as to document admissible in England without proof of seal or signature – When any document is produced before any Court, purporting to be a document which, by the law in force for the time being in England or Ireland, would be admissible in proof of any particular in any Court of Justice in England or Ireland, without proof of the seal or stamp or signature authenticating it or of the judicial or official character claimed by the person by whom it purports to be signed, the Court shall presume that such seal, stamp or signature is genuine, and that the person signing it held, at the time when he signed it, the judicial or official character which he claims, and the document shall be admissible for the same purpose for which it would be admissible in England or Ireland.

Section 44A of the CPC merely provides for the processor execution of a foreign judgment in the courts of India. However, Section 82 of the Indian Evidence Act is a special law with regard to England and Ireland and thereby all such documents which would have been admissible in England would be deemed to be admissible in India. The Hon’ble division bench, when deciding the instant matter, could have taken advantage of this provision and decided on the admissibility of the documents produced on this basis. The court, however, failed to do the same, which unfortunately in my opinion is a grave mistake for admissibility of judicial documents coming from England could only be analysed through the prism of Section 82 of the Indian Evidence Act.

 

(Anubhav Sinha is an advocate in Kolkata.)

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Resisting enforcement of foreign decrees at the interim stage

In Dhirajlal v. Navinbhai Dave (Notice of Motion 726/2011 in Suit 536/2011, judgment dated June 14, 2011), the Bombay High Court considered the question of whether the enforcement of a foreign decree could be resisted at an interim stage. The plaintiffs had filed a suit in the Court seeking the enforcement of a decree passed by the District Court, Dallas County, Texas. A Notice of Motion was taken out seeking interim reliefs with respect to certain properties of the defendants, in order to safeguard the plaintiffs’ rights under the foreign judgment.

In the U.S. proceedings, through a written answer to summons issued by the U.S. Court, the two defendants had contended that the U.S. Court did not have jurisdiction as no part of the cause of action had arisen in the United States. Based on the rules of civil procedure in Texas, the written answer of Defendant No. 2 (Swan Mills Limited) was struck out, and Swan Mills was directed to appoint an attorney entitled to practice in Texas to represent it in the proceedings. Swan Mills did not do so within the stipulated period of time. The plaintiffs also filed a motion for summary judgment against both the defendants, and the motion was served on the defendants. Neither of the defendants took part in proceedings in the U.S. Court, and a summary judgment was entered in favour of the plaintiffs. The plaintiffs sough to enforce this summary judgment in the Bombay High Court, and sought interim protection this respect.

In the High Court, the defendants relied on Section 13 of the Code of Civil Procedure, 1908 and argued that the Dallas summary judgment was not conclusive between the parties, and that no interim reliefs should be granted. Under Section 13, foreign judgments are conclusive as to any matter directly adjudicated upon between the same parties, subject to certain exceptions. One of the exceptions is where the foreign judgment has not been given on the merits of the case. Another exception is where the foreign court has no jurisdiction.

The defendants argued before the Bombay High Court that the Dallas judgment was a summary judgment, without hearing the defendants. Although the rules of civil procedure in Texas had been followed, it was contended that an ex-parte decree passed in a summary manner under a special procedure, without going into the merits and without taking evidence, is not enforceable in India.

Justice S.J. Vazifdar of the Bombay High Court. Image above is from the website of the Bombay High Court.

Justice S.J. Vazifdar of the Bombay High Court.
Image above is from the website of the Bombay High Court.

Justice S.J. Vazifdar, relying on the observations of the Supreme Court in M/s International Woolen Mills v. M/s Standard Wool (UK), AIR 2001 SC 2134, summarised the legal position in the following words:

“… the burden of proving that the decree is not on merits would be on the party alleging it, in this case the defendants… even though the defendant has not entered evidence, the plaintiff may prove its case through oral and documentary evidence… if, after consideration of oral and/or documentary evidence an ex-parte decree is passed it would be a decree on merits. The [foreign] Court must be found to have applied its mind to the matter and considered the evidence made available to it in order that it may be said that there has been an adjudication upon the merits of the case…”.

Justice Vazifdar was also mindful of the fact that he was dealing with an interim application, and the plaintiffs at this stage only had to show the existence of a prima facie case. As to the question of whether the Dallas Court had jurisdiction, he found that the Dallas Court had considered the issue and had held that the defendants had accepted jurisdiction of that Court by filing answers. Further, he also found on a perusal of the records that the Dallas Court had not merely passed the judgment as a matter of course or as a mere formality. Whatever evidence was before the Dallas Court, had been considered; and the judgment was based on that evidence. The Dallas Court had not passed a summary judgment simply due to non-appearance of the defendants, but had applied its mind to the merits.

It was thus held that the relevant questions were thus at least considered by the foreign court. The learned Judge held that whether the extent of consideration given by the foreign court to these questions was adequate to meet the test of Section 13 or not, was undoubtedly an important point. That point, however (he further held), should be left to be decided at the final hearing of the suit and not at the interim stage.

The Bombay High Court has thus affirmed that in interim relief sought in a suit for execution of a foreign judgment, the plaintiff is not required to establish the conclusiveness of the foreign judgment beyond doubt. Even when there are valid doubts about the conclusiveness of the judgment under Section 13 of the Civil Procedure Code, the enforcing court will hesitate to refuse grant of interim protection; and will grant the reliefs required if the plaintiff has merely a possible case for conclusiveness of the foreign judgment. To sum up in Justice Vazifdar’s own words,

“I must clarify that I do not for a moment suggest that the matter is free from doubt. Indeed, there is much to be said in favour of the defendants. The matter certainly requires deeper consideration at the final hearing. I am, however, unable at this stage of the proceedings to come to the conclusion that the judgment is absurd and does not satisfy the test of section 13. That being so, the plaintiff would be entitled to protect their interests under the foreign judgment and decree…”.

 

(Mihir Naniwadekar is a Mumbai-based advocate.)

 

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Need provision for review in arbitration law

The Arbitration and Conciliation Act, 1996 is based on the UNCITRAL Model Law of Arbitration. The minutes (of the discussion) surrounding the model law indicate that the contemplation that any action by the arbitral tribunal or the supervising judicial body would be appealable to a higher court within a finite territorial limit. Most European countries participating in this model law were small countries with judicial systems where arbitral decisions as well as those of the supervising judicial bodies could be appealed to and interfered with, by higher judicial forums within a finite locality. In bigger countries like the United States, Canada, and Australia, the federal structure required any appeal from the decision of any arbitral tribunal or that of a superior judicial authority, to be decided by the highest court within the constituent territory or federal unit of that particular country.

The dismissal of an application for the appointment of an arbitrator cannot be appealed within the same High Court.

The dismissal of an application for the appointment of an arbitrator cannot be appealed within the same High Court. 

A key judicial gap exists in the the Arbitration and Conciliation Act, 1996 (“the Act”). In case of domestic arbitration, the Act provides for four stages of judicial intervention by the supervising judicial body. At first, under Section 9, the court has the authority to grant interim relief to a party to an arbitration; secondly, the Chief Justice of the particular High Court can appoint the required arbitrator or arbitrators as provided under an arbitration clause; thirdly, one may approach the court to set aside the arbitral award under Section 34 and lastly, one may approach the court for execution of the arbitral award under Section 37. In all cases contemplated under Sections 9, 34, and 37, there is scope for an appeal to the High Court under which the particular supervising court is situated. Section 11 of the Act however, shows that there is no scope for any kind of appeal within the same High Court.

It is understandable that the scope for appeal within the same High Court is difficult to envisage as it is the Chief Justice or his designate who makes the appointment of the arbitrator. Clearly therefore, any appeal from such decision of the Chief Justice could only be taken up in appeal under a special leave petition to the Supreme Court. At this juncture, it is important to review the mechanism of Section 11.

Judicial intervention becomes necessary when an application is filed by a petitioner seeking the appointment of a suitable person as an arbitrator with regard to a dispute covered under an arbitration clause. The Chief Justice of the particular High Court then has to look into whether there is a valid arbitration clause among the parties concerned which covers the disputes complained of, and then appoint an arbitrator. However, in some high courts, certain mandatory rules have been framed for an application under Section 11. If there is a default of any specific technical requirements, the judge is required to dismiss the application with the liberty for that party to file afresh. In case of any such non-adherence with a technical requirement at the time of appointment of an arbitrator, then the aggrieved litigant shall have no opportunity to represent (in appeal) before any forum within the particular High Court or state to rectify any such error and would have to depend on an expensive litigation in the Supreme Court by way of a special leave petition.

The only cost effective remedy available to a litigant therefore at the particular High Court is if the Chief Justice himself reviews such appointment. However, no provision for review is contemplated under the Act. Moreover, since this is a special enactment, many judges may (and in fact do) show reluctance in allowing an application for review. It may also be remembered that unlike the Arbitration Act, 1940, there is no provision in the Act which provides for the applicability of the general principles and provisions of the Code of Civil Procedure,1908 which would have allowed for borrowing the concept of review. The Act should be amended to include a provision for review.

 

(Anubhav Sinha is an advocate in Kolkata.)

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Separate prayer for a part of the decision-making process?

Justice Indrajit Mahanty delivered a peculiar judgment in Rama Chandra Mohaptra v. Narayan Chandra Pradhan, G.A. No. 1264 of 2010, reported in 2011 AIR CC 844 (ORI.).

Justice Indrajit Mohanty Image above is from the website of the Orissa High Court.

Justice Indrajit Mohanty
Image above is from the website of the Orissa High Court. 

The plaintiff (at the trial) had been inducted as a tenant to the suit property by the ex-proprietor, who had been accepting rent from him. This fact had been determined by the local tehsildar who had fixed the rent and related payments, which the plaintiff had paid, and thereafter, the state recognised him as tenant of the suit property. The defendants, allegedly, tried to dispossess the plaintiff of the property in collusion with state authorities. A suit was brought before the local Munsif under Order XIV, Rule 2 of the Code of Civil Procedure, 1908, (“the CPC”). The Munsif’s order directed the plaintiff to include a prayer for the declaration of title of the property and allowed him one month to do so. The plaintiff appealed against the order in the Court of the District Magistrate, which agreed with the lower court.

Before the high court, the plaintiff contended that he was “master of his own suit” and that the trial court could not direct him to amend the suit under Order XIV, Rule 2 of the CPC as ordered. He contended that his original prayer seeking “permanent injunction” was permissible under Section 34 of the Specific Relief Act, 1963. He relied on Corporation of the City of Bangalore v. M. Papiah and Another, AIR 1989 SC 1809. In that case, the Supreme Court had held that if the foundation of the claim of the plaintiff was title, to decide the nature of a suit, the entire plaint has to be read and not merely the relief that was being prayed for. On the basis of this averment, the basic argument would be that while asserting proprietary rights over a property, it was not incumbent on a litigant to pray for a specific type of a declaratory relief.

The defendants had asserted in the Munsif’s Court that the Gram Panchayat had been putting the suit property up for auction every year and that the plaintiff had neither title nor possession of the same. Thus, when the title of the property came into dispute, a suit for perpetual injunction could not stand.

The high court upheld the judgments of the lower courts and opined that the trial court could not entertain the present suit without a prayer seeking declaration of title. It held that the prayer for declaration of title was intrinsic to the suit and adjudicating on the basis of the original plaint was impossible bereft of it.

Order XIV, Rule 2 of the CPC authorises the court to pronounce judgment on all issues that it considers material:

2. Court to pronounce judgment on all issues – (1) Notwithstanding that a case may be disposed of on preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues.

Section 34 of the Specific Relief Act, 1963 provides for the discretion of the court to declare status or right in a suit.

34. Discretion of court as to declaration of status or right. – Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief:

“Provided that no court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so.”

Sarkar on Specific Relief Act holds:

“Section 34 enacts that no Court shall make a declaration in a suit in which the plaintiff being able to sue for further relief omits to do so. A suit for a bare declaration without further relief for possession and other reliefs is not supportable. The section does not empower the Court to dismiss such a suit; when the proviso is attracted the Court should, instead of dismissing the suit, give the plaintiff an opportunity to amend the plaint so as to add a prayer for consequential relief”. (emphasis supplied).

The facts of the case at hand are peculiar. The law, as followed by the different courts and the High Court, is clear that unless any prayer is made, the court can make no such declaration when the petitioner had an opportunity to claim for such further relief. However, the relief claimed for was not for a declaration of title, but one for permanent injunction. In case of permanent injunction, the court has to see some particular ingredients, including whether the person had any proprietary interest in the property under dispute. This aspect is a part of any prayer for permanent injunction. In my opinion, to seek a separate relief for what is already a part of the decision-making process is clearly absurd. Another important factor to consider is that title is not the only basis of a permanent injunction – it is the proprietary interest in the property under dispute. In the present instant, the petitioner was a tenant and had no specific title of ownership and so a prayer as such to that effect was impossible to plead.

The ruling is also peculiar with respect to the fact that what is being suggested is that every time one makes a suit for permanent injunction, the plaintiff has to ask for a declaratory relief of title or possession and that no court could infer the same from the plaint. The ratio of this judgement needs to be reviewed and reconsidered at the earliest.

 

(Anubhav Sinha is an advocate in Calcutta.)

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