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Krishna Bai Vs. Hari Govind Kulkarni - Court Judgment

LegalCrystal Citation
SubjectCivil;Contract
CourtMumbai
Decided On
Case NumberSecond Appeal No. 571 of 1905
Judge
Reported in(1906)8BOMLR813
AppellantKrishna Bai
RespondentHari Govind Kulkarni
Excerpt:
decree-consent decree-compromise under civil procedure code (act xiv of 1882), section 375-decree in terms of the compromise-forfeiture clause in the decree- court can relieve against forfeiture.; when a plaintiff is seeking to enforce by original suit a right to forfeiture contained in a consent decree, in the terms of a compromise, whereby the status of landlord and tenant is established between the plaintiff and defendant, the court in the exercise of its equitable jurisdiction is not precluded from granting such relief against forfeiture as it might have granted, had the status arisen from contract or custom. - - 436 in which the plaintiff, relying on a right of re-entry on failure to pay rent, sought to eject the defendant. the defendant failed to pay rent on due dates and the..........when a plaintiff is seeking to enforce by original suit a right to forfeiture contained in a consent decree whereby the status of landlord and tenant is established between the plaintiff and defendant, the court in the exercise of its equitable jurisdiction is precluded from granting such relief against forfeiture as it might have granted, had the status arisen from contract or custom.'2. this should be supplemented by the statement that the consent decree was passed under section 375 of the civil procedure code in accordance with a lawful agreement recorded under that section.3. the reasons for the reference are set forth in the refer, ring judgment in which are enumerated the material authorities. the first case mentioned is shirekuli timapa hegda v. mahablya ilr (1886) 10 bom......
Judgment:

Lawrence Jenkins, K.C.I.E., C.J.

1. The question referred to this Full Bench is, ' whether when a plaintiff is seeking to enforce by original suit a right to forfeiture contained in a consent decree whereby the status of landlord and tenant is established between the plaintiff and defendant, the Court in the exercise of its equitable jurisdiction is precluded from granting such relief against forfeiture as it might have granted, had the status arisen from contract or custom.'

2. This should be supplemented by the statement that the consent decree was passed under Section 375 of the Civil Procedure Code in accordance with a lawful agreement recorded under that section.

3. The reasons for the reference are set forth in the refer, ring judgment in which are enumerated the material authorities. The first case mentioned is Shirekuli Timapa Hegda v. Mahablya ILR (1886) 10 Bom. 436 in which the plaintiff, relying on a right of re-entry on failure to pay rent, sought to eject the defendant. The District Judge however confirmed the decree of the first Court, which granted relief against the forfeiture. On appeal to the High Court it was said that ' the Judge was in error in applying the doctrine of penalties to a stipulation contained in a decree giving effect to the compromise of a suit.'

4. This decision is expressed to be based on the two cases there cited, but it apparently was not perceived that in neither case did the question arise in an original suit, but that in each execution of a decree was being sought. Still there the decision stands, and it must be seen whether on principle it can be supported.

5. Now there can be no doubt that if the matter had rested in agreement, the Court could have relieved : the right to relief would have been an incident of the agreement. Then does it make any difference that the agreement was recorded and a decree passed in accordance therewith ?

6. The mere recording of the agreement can in no way change its legal effect.

7. Can the passing of the decree have any such result? I think not.

8. So far as the decree embodied the right to forfeit, it was declaratory and could not be directly enforced by way of execution. This is conceded by the fact that the plaintiff has deemed it necessary to institute a suit. Then again it has not been and cannot be suggested that by the embodiment of the clause of forfeiture in the declaratory decree the matter became in any sense res judicatd. It appears to me on principle that as under the section the decree was to be in accordance with the agreement, it cannot have altered the relations of the parties as they existed under the agreement. And as it was an incident of those relations that the right of forfeiture was subject to relief, that incident must still apply when those relations are established by a decree passed in accordance with the agreement. It was laid down in Wentworth v. Bullen (1829) 9 B & C 850 and has since been repeatedly affirmed that 'the contract of the parties is not the less a contract and subject to the incidents of a contract because there is superadded the command of a Judge ' and this in my opinion lends a sanction to the conclusion I have expressed.

9. In my opinion, therefore, the question referred as above supplemented should be answered in the negative.

Aston, J.

10. I concur.

Beaman, J.

11. The facts are that the parties entered into a compromise which was embodied, under Section 375 Civil Procedure Code, in a decree of the Court. That decree (inter alia) contained a forfeiture clause. The defendant failed to pay rent on due dates and the present suit was brought on the decree for possession of the demised lands. The question arising upon these facts, which has been referred to the Full Bench, is whether the Court is bound to enforce the forfeiture,of may relieve against it as though the suit, instead of being founded on a consent decree in the terms of the compromise, were founded on contract. Upon this point there is a difference of opinion between the High Courts of Bombay and Madras. The view of the Bombay High Court as expressed in Shirekuli Timapa Hegda v. Mahablya ILR (1886) 10 Bom. 435 was that the doctrine of penalties was not applicable to stipulations contained in decrees that of the Madras High Court as expressed in Nagappa v. Venkatrao ILR (1900) Mad. 265 and affirmed in Lakshmaniswami Naidu v. Ramswami Naidu ILR (1902) 26 Mad. 31 that inasmuch as the decree passed by the Court was a ' mere adoption of the contract which existed between the parties to it, the Court must be taken to have adopted the contract with all its incidents'. It was therefore competent to the Court to relieve against the forfeiture. I may observe that Shirekuli's case, while purporting to be based on, and follow the judgment of West J. in Balprasad v. Dharnidar Sakhararn (1875) P.J. 636 : vide I.L.R. 10 Bom. 437, ignores an important distinction, as to the effect of which we do not think it necessary to express a considered opinion, in disposing of this reference. The latter was a case in which execution of the decree itself was sought to be enforced. Both the Madras cases, however arise out of facts which cannot in this particular be distinguished from those in Balprdsad v. Dharnidar. The dissent of the Madras High Court from the view which has hitherto prevailed in this Court is more positive and definite, than if it were limited to such a case as Shirekuli Timapa v. Mahablya, and had taken account of the distinction to be drawn between that, and the case on which it is founded. Premising that I confine myself strictly to the facts of this reference, I am of opinion, that the doctrine which found favour with the learned Judges who decidedShire Kuli's case, is erroneous. I think that it makes consent decrees of this kind, when they are subsequently sued upon, too rigid, and loses sight of an important principle which has more than once been mentioned, in analogous cases, with approval by some of the most eminent English Judges. When parties compromise and request a Court to embody the terms of the compromise in a decree, the Court has not adjudicated upon the dispute, it has done no more than sanction and stereotype, a contract made by the parties themselves. And this it is bound to do. The only condition imposed upon it is that the agreement should be lawful. By private agreement, converted into a decree, parties cannot empower themselves to do that which they could not have done by private agreement alone- Great North-West Central Railway Company v.Charleroi's [1899] A.C. 114 If such a decree in virtue merely of being a decree of Court is not competent to do that for the parties which they might not do for themselves ; if in other words it is on proper cause shown liable to examination ; it follows logically and necessarily that when a suit is afterwards brought upon it, it is to be taken not as what has to be unquestioningly and literally enforced ; but only as the indisputably correct presentment of the contract which at the time it was drawn up, the parties had made and wished to be decreed. The difference between a consent decree declaring the agreement of parties, and the agreement of parties themselves, when the one or the other is sought to be afterwards enforced, appear to me on general principles to go no further than this, that in the former case it would not be open to a party to question the accuracy of the decree, as expressing what at the time was the contract which had been made. As was observed by Parke B. in Wentworth v. Bullen (1829) 9 B & C 850 afterwards cited with approval by Erle C.J. in Lievesley v. Gilmore (1866)1 C. P. 570, ' The contract of the parties is not the less a contract and subject to the incidents of a contract, because there is superadded the command of a Judge.' Applying that principle to. the facts we here have to deal with, it appears to me, that when a party brings a suit to enforce a consent decree of this kind by which the terms of a perpetual lease were roughly declared, with a forfeiture clause added, and when the defendant prays for the ordinary relief against that forfeiture, the Court is not precluded from treating the decree as no more than the contract between the parties, subject to the incidents of such a contract. Amongst those incidents equitable relief against a forfeiture is not the least important and is well established.

12. A party to a contract embodied in a consent decree cannot, I think, be held to have renounced any incidental advantages or equitable reliefs of which, upon the face of the contract itself as presented in the decree, he might ordinarily have claimed the benefit.

Heaton, J.

13. I concur.


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