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Bai Laxmibai Vs. Shridhar Manik Patel - Court Judgment

LegalCrystal Citation
SubjectProperty;Arbitration
CourtMumbai
Decided On
Case NumberO.C.J. Arbitration No. 91 of 1941
Judge
Reported inAIR1943Bom221; (1943)45BOMLR416
AppellantBai Laxmibai
RespondentShridhar Manik Patel
DispositionPetition dismissed
Excerpt:
indian arbitration act (x 'of 1940), section 14-notice of award-time of giving notice-notice may be by arbitrators' attorneys-absence of arbitrator-acquiescence of parties.;under section 14(1) of the indian arbitration act, 1940, it is not necessary that arbitrators should give notice in writing to the parties at the time or immediately after the award is made and signed. it may be given within a reasonable time thereafter. such notice need not be given by the arbitrators themselves; it may be given on their behalf by their attorneys.;where at one of the meetings of the arbitrators one of the arbitrators is absent and the arbitrators present suggest a certain course of action which is adapted by all the arbitrators at the subsequent meeting and acquiesced in by the parties, the award made..........'shall give notice.' section 14(2) provides that the arbitrators have to make their award. the time to make their award is controlled by clause (3) of the first schedule which provides that in the absence of a contract to the. contrary the' arbitrators must make their award within four months from: the date of entering on the reference or within the further extended time as mentioned therein. the signing of the award must follow the making of the award. the provision about giving notice in writing to the parties, in my opinion, does not necessarily mean at the same time or moment. it is true that the arbitrators are expected in the ordinary course to give notice within a reasonable time after the award is made and signed by them; but, i am unable to read section 14(2) as compelling.....
Judgment:

Kania, J.

1. This is a petition to set aside an award made in the matter of partitioning the estate of a joint Hindu family. The petitioner is the widow of a deceased brother of the respondents. The agreement of reference is dated December 5, 1940, and seven persons named in the agreement were appointed arbitrators to make a division of the joint and self-acquired moveable and immoveable properties of the family. The arbitrators made their award on April 30, 1941. It is signed by all the seven arbitrators. The notice of making of the award was given' on October 2, 1941, by the arbitrators' attorneys and this petition was filed on February 20, 1942.

2. On behalf of the petitioner only three points are pressed in support of the application, The first is that no proper notice of making and signing the award was given. The argument is two-fold : firstly, that notice must have been given on the same day on which the award was made, and, secondly, that the notice given by the attorneys is improper and should have been given by the arbitrators themselves. The petitioner contends that under Section 14(1) of the Indian Arbitration Act (X of 1940) notice must be given on the same day as the award because the section opens with the word, 'When'. According to the petitioner all the three acts, viz. making of the award, signing the award and giving notice to the parties must be done at the same time. Sub-section (2) of that section is used in contrast to show that when the Legislature intended that an act might be done by another party, e.g. causing the award to be filed, the Legislature had stated so clearly. It is argued that causing the notice to be given by the attorneys amounts to delegation of authority and no arbitrator is entitled to delegate his work. In my opinion this line of reasoning is unsound. I am unable to read the word 'When' as meaning what is contended for by the petitioner. The word 'When' in Section 14(1) in my opinion has to be read with 'have made.' It does not control (with the meaning stated to attach thereto) the words 'shall give notice.' Section 14(2) provides that the arbitrators have to make their award. The time to make their award is controlled by Clause (3) of the first schedule which provides that in the absence of a contract to the. contrary the' arbitrators must make their award within four months from: the date of entering on the reference or within the further extended time as mentioned therein. The signing of the award must follow the making of the award. The provision about giving notice in writing to the parties, in my opinion, does not necessarily mean at the same time or moment. It is true that the arbitrators are expected in the ordinary course to give notice within a reasonable time after the award is made and signed by them; but, I am unable to read Section 14(2) as compelling them to give notice on the same day on which the award is made and signed. By the fourth schedule to the Indian Arbitration Act Articles 158 and 178 of the first schedule to the Indian Limitation Act are amended. Thereby the time is fixed for filing the award, after the date of the service of the notice of making of the award, and time is also fixed for filing an application to set aside an award after the notice of filing of the award is given to the parties. No time is fixed either by the Indian Arbitration Act or by the Indian Limitation Act within which the arbitrator should give notice of the making and filing of the award. In my opinion that is a deliberate omission and the result is that the arbitrators are left with a free hand on that point. As I have pointed out, it is their duty after they make and sign their award to give notice to the parties within a reasonable time, which must be fixed according to the circumstances of each case.

3. In the present case the arbitrators' notes show that on April 30 the arbitrators signed their award and the parties intimated that they desired the arbitrators to wait before filing the award. Under High Court Rule 375 it is necessary for the arbitrators, when filing an award, to file along with the same the notice given to the parties and the affidavit of service of such notice on them. If, therefore, the parties have requested the arbitrators to refrain from filing the award the arbitrators must naturally have refrained from serving notice of the making of the award for some time and given notice when they thought that reasonable' time had expired. It may be pointed' out that soon after the award was made the parties received copies thereof and as shown by the correspondence annexed to the affidavit of the respondents, from May 7 the petitioner was asking for clarification of certain points. It also appears that certain documents were prepared and perhaps time was taken to do that before the arbitrators were requested to file the award. This correspondence clearly shows that the time between the making of the award and the giving of the notice was spent in this discussion.

4. The second part of the petitioner's contention that the arbitrators had delegated their authority has no substance. The giving of the notice is not exercising any judicial function of an arbitrator]. In the ordinary course a man is entitled to get a thing done which he is himself entitled to do, and' unless the Legislature has limited his power he has authority to delegate the same to an agent as provided by the Indian Contract Act, 1872. It is, therefore, for the petitioner to show that this work, which was entrusted to the attorneys, was not permitted in law. The notice is only to the effect that an award has been made. It is not any decision on any of the disputes referred to the arbitrators. In my opinion it is only a ministerial act which the arbitrators were fully entitled to delegate to their attorneys.

5. The second objection urged on behalf of the petitioner is that the arbitrators had no jurisdiction to award Rs. 8,000 to be set aside for the marriage expenses of the daughters of the two branches. Mr. Daphtary who appears for the respondents has agreed that out of the paragraph marked '(1)' the following portion from the commencement may be omitted, viz. 'All the three brothers have got in all four unmarried daughters, 1. Miss Prabhavati.... The' amount should be made available at the marriage time and the guardians should make the expenditure and use (of the amount) according to their wishes.' I make the order accordingly. There will, therefore, be a consequential amendment in Schedule IV in second column which deals with the amount set apart for defraying joint family expenses. The item relating to Rs. 8,000 for marriage expenses of the daughters should be deleted from there. The result of this alteration is that this amount, which is left undisposed of, will be covered by the last part of the award which deals with the balance after making the expenses directed to be made and directs the same to be divided between the parties as mentioned therein. This, in my opinion, is quite fair because normally each branch of the joint family must bear the expenses of the unmarried daughters of that branch after partition. Having regard to this agreement, I do not propose to deal with this objection, as it is unnecessary to do so.

6. The third objection is in respect of the meeting held by the arbitrators on March 7, 1941. At that meeting two arbitrators were absent. All the parties were present. Two decisions were taken at the meeting which are recorded in the notes of the arbitrators and which are not disputed. The first was that the valuation report submitted by Mr. Gupte was gone through and the first choice was decided to be given to the petitioner to select one of the three divisions made by the architect. Obviously this is a decision in favour of the petitioner as it gives her the first selection out of the three divisions made by the architect. The second decision runs as follows :-

Relating to property at Library Road if one of the brothers is willing to retain the same for the price fixed by the architect the preference should be given to him; if not the same should be sold for Rs. 20,000 nett without any expenses i.e. the purchaser should bear all the costs.

At this meeting the petitioner asked for the plan to be shown to her pleader and that plan was signed by all the three parties. The next meeting of the arbitrators was held on March 16 when all the arbitrators were present. The notes of that meeting show that, as decided on the previous day, the petitioner was given the first choice and she selected the portion marked C-C. I on the plan. The respondents were next asked to select and they made their selections out of the other two divisions. The next paragraph of the notes runs as follows :-

Mr. S.M. Patel when asked if he is prepared to retain the property at Dadar Library Road for Rs 18,000 the price fixed by the engineer said he required four days to consider the proposal which was granted.

7. In my opinion this argument of the petitioner must also fail. It is not alleged in the petition that the offer made to Mr. S.M. Patel was unjust: or unfair. Although the two arbitrators were absent on the day it was decided to make the offer to either of the brothers, if he was so minded to take it, the actual offer was made by all the arbitrators on March 16 when all the parties were present and it was made to respondent No. 1 only. The decision of the arbitrators, therefore, is contained in the notes of March 16, viz. offer to respondent No. 1. At that time all the parties were present and the decision to make the offer was also of all the arbitrators. Respondent No. 1 asked for time and that application was also considered and granted by all the arbitrators. The argument of the petitioner is that all the arbitrators had not applied their mind to let one of the brothers purchase the property at the valuation fixed by the architect. In my opinion to support this argument the evidence is completely lacking, if it is not the other way. The report of the engineer was before the arbitrators on March 7 as also on March 16. On the 16th all the arbitrators called upon the petitioner, acting on the report of the engineer, to make a selection out of the plots marked on the plan. In the same way all the arbitrators, being aware of the report of the engineer, made an offer for the first time to respondent No. 1 to purchase the property at Rs. 18,000, which amount was mentioned in the report to their knowledge. I do not think in this case the absence of the two arbitrators has caused any injustice. I do not think that they arrived at any decision which was acted upon by the others. On the plain reading of the notes, the decision was made by all the arbitrators on March 16. It is significant that while in respect of the offer made to the petitioner to select one of the divisions the paragraph starts 'As decided in the last meeting...' no such reference is made in respect of the offer made to respondent No. 1 and which offer is contained in a separate and distinct paragraph.

8. Moreover, if there was any slight irregularity, it is clear that no objection was taken to that by the petitioner. The' actual acceptance of the offer (although it is not clear from the notes on what date) was certainly made later on and at which meeting all the arbitrators were present The petitioner strongly relied on Patel Bros. v. Shree Meenakshi Mills, limited. : AIR1942Bom236 In that case dispute's between the parties arising under a contract made under the rules of the East India Cotton Association, Ltd., were referred to arbitration. After the award was made an appeal was filed under the rules and nine directors formed the Appeal Committee. One of them left during the course of the hearing and the award was signed only by eight directors. Under the rules six directors could constitute a quorum to do any business. It was argued that as the award was made by more than six directors it was valid, That argument was rejected. The decision is that nine persons having constituted themselves the Appeal Committee and heard the appeal, the decision of eight was not decision of the Appeal Committee. I do not see how that decision helps the petitioner in this case. The award here is of all the arbitrators. Moreover, as painted out in that case, if the patty acquiesces in an irregularity, the same cannot be relied upon as a ground to set aside the award. In the course of his judgment Beaumont C.J. observed as follows (p. 493):-

In the absence of consent, I think, the true rule is that the tribunal, which has commenced the appeal, must continue, and if any member is obliged to withdraw, and the parties are not willing to go on before the remaining members, then a fresh board must be constituted.

In Dobson v. Groves (1844) 6 Q.B. 637 Lord Denman C.J. in considering the question of irregularity observed as follows (p. 648) :-

It is suggested that the complaining parties waived their right to object by not protesting before the award was made. Where an irregularity takes place at a meeting of all the parties, and is passed over, that observation may apply. But, where a party wishing to be present has been excluded from the meeting, the opportunity of setting right what was irregular is past. The mischief was done at the time, and cannot be removed.

While, therefore, the general rule is that the meetings of the arbitrators must be attended by all the arbitrators and the decision arrived at must be the decision of all, it is clear that if some formal decision was made (as noted in this case, in the notes of March 7), the irregularity may be waived. In particular on the evidence in this case I hold that it was waived by the petitioner by the proceedings which took place before all the members and in the presence of all the parties at the meeting held on March 16 and the subsequent meetings. In my opinion, therefore, the petitioner fails, and subject to the modification mentioned in the judgment in respect of the sum of Rs. 8,000, the petition is dismissed.

9. Under the circumstances of this case I do not think it will be right to order the petitioner to pay the costs. Her grievance' in respect of Rs. 8,000 in any event has been remedied as a result of this petition. I, therefore, direct that Rs. 550 being the fixed costs of the petitioner and Rs. 400 being the fixed costs of the respondents be paid out of the sum of Rs. 8,000 directed to be set apart in the original award for the marriage expenses of the unmarried daughters. The balance of that sum should be treated as forming part of the amount directed to be disposed of by the last part of the award.


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