1. This appeal has been filed against the judgment and decree of the Senior Subordinate Judge, Rohtak dated August 9, 1971.
2. Briefly, the facts of this case are that the plaintiffs claimed themselves to be the owners of the property in dispute along with the defendants. They further stated that the defendants started certain construction on the property in dispute of which they were not entitled. They have claimed permanent injunction restraining the defendants from raising the construction on the property in dispute. The defendants controverted the pleas of the plaintiffs. While the suit was pending, Mathura Dass plaintiff, Ram Sarup defendant and the counsel for the parties made a statement that they had agreed that the Court might inspect the spot and give any decision about the case and the parties will be bound by the said decision of the Court as referee. The trial Court in view of the statement inspected the spot in the presence of the counsel for the parties on July 9, 1971, at 5.00 P. M. The trial Court after inspection of the spot and hearing the counsel for the parties held that he did not agree with plaintiffs contention. That the place in dispute which is in the form of kacha chabutra belonged to both the parties. Consequently, he dismissed the suit of the plaintiffs. Jogi Ram and Gokal plaintiffs filed an appeal against the judgment and decree of the trial Court to the Senior Subordinate Judge who after hearing the counsel for the parties held that the appointment of the referee was defective as the power-of-attorney did not contain a clause which authorizes the counsel for the plaintiffs to refer the matter to the referee on behalf of the plaintiffs. Further, he held that the impugned decree could not be said to have been passed with the consent of the parties. It was also held that, in the circumstances, the appeal was maintainable. He consequently remanded the case to the trial Court for disposal in accordance with law. The defendants have come up in appeal to this Court.
3. The first contention of the learned counsel for the appellants is that the counsel for the respondents had been given specific powers in the power-of-attorney to compromise and the reference to a referee tantamount to a compromise. He has referred to various clauses of power-of-attorney. The translation of Clause 2, to which a reference has been made, is as follows:--
'To present petition of plaint, written statement, grounds of appeal and all objection petitions, review, revision or to withdraw the suit or to effect compromise or to file all sorts of other petitions and put his signature thereon or to present affidavits or documents as shall be deemed necessary or advisable or to submit the said cause or any issue touching the said cause to arbitration or to file objections against the award or to effect compromise after the execution of the decree.'
4. In clause (1) of the power-of-attorney general power has been given to the counsel to do all acts which the counsel could legally do. From the perusal of above said terms in the power-of-attorney, it is clear that the respondents had conferred the power to conduct proceedings on the counsel. They had also conferred powers upon their counsel to compromise. Even if the said powers had not been conferred by the power-of-attorney, an Advocate in India has got general powers even to compromise on behalf of their clients. As far back as in 1930, the Privy Council in Sourendra Nath Mitra v. Tarubala Dasi, AIR 1930 PC 158, observed that power to compromise a suit is inherent in the position of an Advocate in India. It was further held that the considerations which have led to this implied power being established in the advocate of England, Scotland and Ireland, apply in equal measure to India. The general powers of an Advocate have been narrated by the Privy Council in the following terms:--
'The implied authority of counsel is not an appanage of office, a dignity added by the Courts to the status of barrister or advocate at law. It is implied in the interests of the client, to give the fullest beneficial effect to his employment of the advocate. Secondly, the implied authority can always be countermanded by the express directions of the client. No advocate has actual authority to settle a case against the express instructions of his client. If he considers such express instructions contrary to the interests of his client, his remedy is to return his brief.'
5. From the perusal of the aforesaid-para, it is clear that in case a client does not want to give power of compromise to his counsel, he should specifically issue instructions to that effect. In the present case, as stated above, no instructions have been produced that the counsel had no authority to compromise on behalf of the respondents. The Privy Council's case has been followed in a number of cases in High Courts in India. Reference may only be made to Laxmidas Ranchhoddas v. Savitabai Hargovindas Shah, AIR 1956 Bom 54, where after noticing the Privy Council's case, a Division Bench consisting of Chagla, C. J. and Desai, J. observed as follows:--
'It is impossible for a member of the Bar to do justice to his client and to carry on his profession according to the highest standards unless he has the implied authority to do everything in the interests of his client. This authority not only consists in putting forward such argument as he thinks proper before the Court, making such admission as he thinks proper, but also to settle the client's litigation if he feels that a settlement will be in the interests of his client and it would be foolish to let the litigation proceed to a judgment. This implied authority has also been described as the actual authority of counsel or an advocate practicing in India.'
The above case was also noticed by this Court in Mst. Bachni v. Kartar Singh, AIR 1963 Punj 376, wherein Shamsher Bahadur, J. after taking into consideration several other cases observed that unless there was an express direction to the contrary by a client an authority of a counsel to compromise a suit always existed. It was further held that the authority to compromise was not an appanage of office arising from the status of the advocate, but is implied in the interests of the client, to give the fullest beneficial effect to his employment of the advocate. An argument was raised before the learned Judge that in Sourendra Nath Mitra's case, AIR 1930 PC 158 (supra) the Privy Council had observed that where the legal representative, in Court, of a client derives his authority from an express written authority, such as, a vakalatnama, different considerations may well arise, and in such cases, their Lordships expressed no opinion as to the existence of any implied authority of the kind under discussion. Shamsher Bahadur, J., after taking into consideration the above observations and after noticing several other cases observed that the sum and substance of these authorities was that unless there was an express direction to the contrary by a client, an authority to compromise was always there. Subsequently, this matter was again discussed in a Full Bench judgment reported as Chengan Souri Nayakam v. A. N. Menon, AIR 1968 Ker 213(FB), where the majority view was the same as was expressed in Mst. Bachni's case, AIR 1963 Punj 376 (supra). On the other hand, the learned counsel for the respondents has relied on Shital Prasad Singh v. Surendra Nath Chatterji, AIR 1950 Pat 253, where a Division Bench of that Court held that where an advocate derives his authority under a vakalatnama, his powers depend upon the instrument which empowers him. The learned Judges of the Patna High Court while deciding this matter have observed that the observations of the Privy Council were limited only to the cases where the lawyers appeared without vakalatnama. In making the said observations, the consideration was that the vakalatnama on the basis of which the authority was given to the counsel was not before them. The observations of the Privy Council on which the learned Judges relied have been interpreted in a different way by Shamsher Bahadur, J., in his judgment in Mst. Bachni's case (supra). I am in respectful agreement with the observations of Shamsher Bahadur, J. The facts of the case before the learned Judges of the Patna High Court are distinguishable from those of the present one and the respondents cannot get any help from it. The learned counsel for the respondents then relied on Hutcheeregowda v. Sangeevagowda, AIR 1954 Mys 167. In this case also there was an express authority in favour of the counsel to compromise and the learned Judge after taking into consideration the facts of that case held that the compromise by the counsel was a valid one. So the respondents cannot derive benefit from this case also. In my view, the counsel for the respondents had ample authority to enter into a compromise on their behalf.
6. The second question that has been canvassed before me is whether such power could be conferred upon the Court by the counsel for the respondents. The learned counsel for the appellants has very vehemently argued that the parties have got right to appoint referees and the counsel for the parties have also got the right to do so. He submits that the appointment of a referee also tantamount to a compromise and the statement of the referee is binding on the parties. He has also submitted that the finding of the referee is binding on both the parties and no appeal is maintainable against such a finding. In support of his contention, he has relied on Ganga Ram v. Jagu, AIR 1934 Lah 176(2). In this case, an application was made requesting that the Court should decide the case after local inspection and local inquiry as an arbitrator which is signed by the pleaders duly authorized to compromise. It is also stated in the application that some of the defendants were minors and that the compromise was for the benefit of minors. No specific sanction had been given by the Court on behalf of the minors. The Court after local inspection decreed the suit. The defendants filed an appeal before the Senior Subordinate Judge and he held that the decree of the trial Court, in the circumstances, tantamount to a consent decree and no appeal was competent. The defendants went up in appeal to the High Court. Bhide, J. after perusing various cases observed of a Court as that of an arbitrator without any objection, implies that the decision was to be accepted as final and there was no right of appeal to another forum. He has then relied on Hem Lata v. Jamboo Prasad, AIR 1959 All 382. In this case also a statement had been made by Mukhtar-a-Khas that the matter might be determined upon the statement of a referee upon special oath. The observations of the Learned Bench in this respect are as follows:--
'An agreement to abide by the statement on oath of a particular witness is in substance not a reference to arbitration. Such an agreement is not opposed to public policy, or repugnant to the provisions of the Contract Act or any other law but is binding on the parties. The power to abide by the statement of a witness is necessarily implied in the general authority given under the Vakalatnama. Where a decree is passed on the basis of the statement of the witness who was a witness of the plaintiff's own choice, the plaintiff cannot resile from it on the ground that the Mukhtar Khas had exceeded the power given to him by agreeing to abide by the statement of the referee.'
7. I am in respectful agreement with the aforementioned observations and held that the counsel for the respondents hid the power to appoint a referee and the respondents were bound by the decision of the referee.
8. The learned counsel for the respondents has next submitted that the power conferred on a counsel to adjust a matter does not include a power to refer the matter to arbitration on the principle underlying the maxim delegata potestas non potest delegare. In support of his contention, he has relied on P. L. S. S. Ramanathan Chettiar v. K. M. V. V. Kumarappa Chettiar, AIR 1940 Mad 650 and Konda Anthiah v. Madan rao, AIR 1969 Andh Pra 211. The said cases were decided on peculiar facts involved in them. As such, the observations in those cases are of no help to the respondents. If power of compromise vests in the counsel, he has also power to appoint a referee. Appointment of a referee is nothing more than to compromise a suit. In the case of compromise, the counsel settles the terms on the basis of which the litigation is brought to an end and in the case of appointment of a referee, he authorizes another person to give his decision for deciding the matter finally between the parties. In both eventualities, the decree passed will tantamount to a consent decree, which will not be subject to appeal. In the present case, some of the parties and the counsel of all the parties, appointed the Court as referee who otherwise had to decide the thelis. The plaintiffs, it looks, felt aggrieved when their suit was dismissed by the Court after inspection of the spot. I do not find any merit at all the contentions of the learned counsel for the plaintiff-respondents in view of position of law and especially on the facts of this case.
9. I, therefore, accept this appeal with costs and restore the decree of the trial Court by which suit of the plaintiffs was dismissed.
10. Appeal allowed.