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Gaylord Restaurant and ors. Vs. M. Chabbrai - Court Judgment

LegalCrystal Citation
SubjectCivil;Commercial
CourtChennai High Court
Decided On
Case NumberC.S. No. 29 of 1972
Judge
Reported inAIR1975Mad108
ActsCode of Civil Procedure (CPC) , 1908 - Order 38, Rule 5
AppellantGaylord Restaurant and ors.
RespondentM. Chabbrai
Appellant AdvocateAiyar and Dolia, ;S.P.L. Palaniappan and ;C.D. Murlidhar, Advs.
Respondent AdvocateHabibullah Badsha and ;P.J. George, Advs.
DispositionSuit dismissed
Cases ReferredNanjappa Chettiar v. Ganapathi Goundan
Excerpt:
.....to be proved--mere procuring of an order for attachment--whether sufficient to sustain on action--attachment order--process of court applied--effect--no want of malice or reasonable cause--action not maintainable. ; where merely an order of attachment has been procured and nothing more is done in furtherance thereof, the plaintiff cannot complain in a suit for malicious attachment that he has been damnified. in fact no cause of action could arise in favour of the plaintiff. procuring an order for attachment before judgment, however malicious does not of itself, afford a cause of action for damages as damage does not necessarily and naturally flow from an application for attachment before judgment. ; a completed attachment by seizure of any of the plaintiff's property is not..........these circumstances, the defendant apprehended that his claim also could not be realised unless a suit was filed and obtained an order of attachment before judgment. the defendant was not aware of the financial position of the individual partners and there is absolutely no malice as far as the defendant was concerned. hence the plaintiffs have not suffered any damage much less to the extent of rs. 51,000/- and hence the suit is liable to be dismissed.4. on these pleadings, the following issues were set down for trial:1. whether the suit is not maintainable for the reasons stated in the additional written statement?2. whether the suit is bad for nonjoinder of parties?3. whether the plaintiff has no cause of action against the defendant ?4. whether the defendant did obtain order of.....
Judgment:
1. Suit is for recovery of a sum of Rs. 51,000/- by way of damages for malicious attachment. The plaint allegations are as follows: The first plaintiff firm is a registered partnership consisting of plaintiffs 2 to 5 and one Ramchand Motumal Hinduja. The firm is carrying on business as caterers at No. 36-D Mount Road. Madras-2 and the partners of the plaintiff firm are respectable persons and men of status and financially well placed. Plaintiffs 2 to 5 are carrying on business in banking to the knowledge of the defendant who is also a close relative of the plaintiffs. Disputes arose between the plaintiffs on the one hand and the defendant on the other. The defendant instituted a suit O. S. No. 3634 of 1971 on the file of the City Civil Court, Madras for recovery of a sum of Rupees 1,017/- due by wav of advertisement charges to him. In the said suit. I. A. No. 9630 of 1971 was also filed seeking an order of attachment before judgment of the movables of the first plaintiff firm. In support of this application, an affidavit was filed alleging that the first plaintiff in order to defeat and delay the creditor was negotiating to alienate the business and was about to leave the jurisdiction of the Court. An ex parte order of attachment was passed on 26-6-1971 directing the attachment of the movables of the first plaintiff firm at its premises No. 36-D. Mount Road, Madras. In execution of the warrant, the defendant accompanied by the Bailiff came to the business premises of the first plaintiff on 28-6-1971 at 11.45 A. M. The arrival of the defendant with the bailiff shocked the plaintiffs as a result of which many enquiries by the customers came to be made. Ultimately, the entire amount mentioned in the warrant namely Rs. 1,178/- was paid though the conditional amount of the warrant as ordered by the City Civil Court, Madras was only Rs. 500/-. These proceedings including the false statements made in the affidavit filed in support of the Interlocutory Application No. 9630 of 1971 were taken solely out of malice with a view to cause damage to the plaintiffs. As a result of this malicious attachment the plaintiffs have suffered very much, and they estimate the damages at Rupees 51,000/-. Hence the suit.

2. The defendant filed a written statement contending that one L.C. Anand who held 45% share of Ramchand Motumal having 11% share ought to have been impleaded as parties and failure to do so would entail dismissal of the suit.

3. The suit in the City Civil Court, Madras came to be filed since in spite of repeated notices, the sum of Rs. 1,017/- was not paid. At the time of the filing of that suit, while making enquiries regarding the financial status of the firm, the defendant learnt that the partner holding a major share in the firm namely one L.C. Anand had withdrawn from the firm and that the plaintiffs had not settled his claim even after a lapse of over one year; the plaintiffs were heavily indebted to a Bank and several other parties and they were attempting to sell away their business. The defendant also learnt that on at least three prior occasions, various other parties were obliged to file suits against the plaintiffs to recover their dues. Under these circumstances, the defendant apprehended that his claim also could not be realised unless a suit was filed and obtained an order of attachment before judgment. The defendant was not aware of the financial position of the individual partners and there is absolutely no malice as far as the defendant was concerned. Hence the plaintiffs have not suffered any damage much less to the extent of Rs. 51,000/- and hence the suit is liable to be dismissed.

4. On these pleadings, the following issues were set down for trial:

1. Whether the suit is not maintainable for the reasons stated in the Additional Written Statement?

2. Whether the suit is bad for nonjoinder of parties?

3. Whether the plaintiff has no cause of action against the defendant ?

4. Whether the defendant did obtain order of attachment maliciously without any reasonable or probable cause ?

5. Whether the plaintiffs have suffered any damage to their reputation due to the malicious action of the defendant ?

6. To what reliefs are the parties entitled ?

5. On the side of the plaintiffs P. Ws. 1 and 2 have been examined while the defendant has examined himself as D. W. 1. Exs. P-2 to P-30 have been marked on the side of the plaintiffs and Exs. D-1 to D-18 have been marked on the side of the defendant.

6. P. W. 1 is the second plaintiff. He says in chief examination that they have been carrying on banking business for more than 100 years in Madras. The restaurant 'Gaylord' was bought by them in June 1968 and originally they entered into a partnership with one Anand and he was given 45% share and advertisements were issued to the magazine 'Adam and Eve' and because some blocks were stolen a criminal complaint was filed against Amar Lal who was running the magazine Adam and Eve and in the criminal complaint on behalf of Adam and Eve he was representing. Amar Lal was suspended by the association of the bankers and in order to take revenge and more so because of the criminal complaint the present attachment has come to be filed. Several assessment orders to evidence the individual financial position of the partners have also been marked through him. In cross-examination by the defendant he states that he wrote a letter on 5-4-1971 to the Sind Multani Association debarring Amarlal since he has cheated many clients.

7. P. W. 2 is another partner of Gaylord. He says that on the date of attachment P. W. 1 was in the restaurant. Along with the Bailiff, the defendant and a photographer came. The volume of banking business at the time of attachment was Rs. 1,50,000/-. In cross-examination nothing important has been elicited.

8. The defendant who appears in person has examined himself as D. W. 1 and to a question whether he would like to add anything to his written statement he said 'no' and he proceeded to mark certain documents. He was cross-examined by the learned counsel for the plaintiff and in that cross examination he stated as follows: He was the proprietor of the firm Adam and Eve and the Editor was Amar Lal Nichani and Mrs. Anjali Sarcar. But at the time when the advertisement was put in the magazine in 1968 and 1969 he was not the proprietor. A telegram was issued calling upon the first plaintiff to pay. That was in April. Since the Court was closed during May and June the suit came to be filed after re-opening and attachment was effected. All the averments are based upon the information given by his advocate. He further states that the relationship between him and his brother-in-law Amar Lal is far from cordial.

AMENDED ISSUE NO. 1 AND ISSUE NO. 2.

9. Though it was originally argued that unless the proceedings in which the attachment was effected came to a conclusion the suit was not maintainable. Before the matter was taken up for trial, the Interlocutary Application in which the attachment before judgment was ordered has been closed, and then it was terminated. I have not been addressed any arguments as to how the suit is bad for non-joinder. Hence I answer these Issues in favour of the plaintiffs.

10. ISSUES NOS. 3 TO 5 : These are the important Issues which arise in the suit. It is contended by Mr. Palani-appan, learned counsel for the plaintiffs that malice on the part of the defendant is clearly made out by the fact that at the instance of P. W. 1. Amar Lal, brother-in-law of the defendant was suspended from the Finance Brokers' Association and certain criminal complaints were also preferred against Amarlal. These have angered him to instigate the defendant to file a suit and the attachment before judgment was obtained solely with a view to damnify the reputation of the plaintiffs whose financial status was fully known to the defendant.

11. Belying on Naniappa Chettiar v. Ganapathi Goundan, (1912) ILR 35 Mad 598 it is contended that where the motive for the attachment is not to defeat any intended fraud on the part of the debtor, but to enforce speedy payment, it will amount to malice and in the instant case Ex. P-5 would clearly show that all that defendant was interested was In recovering the advertisement charges without being concerned about the status or wealth or the business of the partners of the first plaintiff and this establishes malice on the part of the defendant. In this case, the defendant has without any justification made reckless allegations and if an order of attachment is procured on insufficient grounds it would undoubtedly cause damage to the plaintiff and the decision inKumaraswamia Pillai v. Udavar Nadan, (1909) ILR 32 Mad 170 supports this submission. Relying on Sudhangshu v. Haricharan, AIR 1932 Cal 847 it is contended that it is not necessary for the plaintiff to show that the order of attachment is wholly wrong or without jurisdiction. It is sufficient if it is shown that the defendant has acted without reasonable and probable cause. In the instant case by making various allegations in the affidavit in support of I. A. No. 9630 of 1971 in O. S. No. 3634 of 1971 the defendant acted without reasonable cause,

12. It is contended on behalf of the defendant that this is a case in which there is only an order of conditional attachment and if the attachment has not been effected, there is no cause of action and consequently the question of damages would not arise at all and the decisions in Kedarnath v. Beherilal, ILR 49 Bom 629 = (AIR 1925 Bom 357) and Shah Umed Mal v. Shah Bhutaji, ILR (1969) 19 Raj 701) fully support his submission.

13. There were three prior attachments and the financial position of the firm was far from satisfactory and the claim of the erstwhile partner remained unsatisfied and this is the background which should be kept in mind to determine the question of malice. 'Malice' in fact according to Halsbury's Laws of England (Simonds Edition) Third Edition Vol. 25 page 356 paragraph 696 is malus animus indicating that the defendant was actuated either by spite or ill-will against the plaintiff, or by indirect or improper motives.

14. Inasmuch as it is the definite case of the defendant, that he had nothing to do with his brother-in-law Amarlal whatever might have been the ill will between P. W. 1 and Amar Lal that will have no bearing as far as the defendant procuring the attachment was concerned. The absence of the ill will is established by the fact that even at the time when the defendant went with the Bailiff at about 11 A. M. he waited for nearly 3 hours for securing payment. Further, there is no improper motive either in filing the suit or getting the order of attachment since in spite of repeated damands and a telegram the amount remained unpaid. In reply to these submissions, it is argued by the learned counsel for the plaintiffs, that it is not necessarv that there must be actual attachment to found a claim for damages. Though mere procuring of an attachment itself is not sufficient, any step taken in furtherance of the order would be enough to cause damage and the decision Joseph Nicholas v. Sivarama Iyer, AIR 1922 Mad 206 is an authority on this point.

15. Let me now consider the merits of these contentions. I will now take up the first question whether it is necessary, to found a claim for damages on the ground of malicious attachment, that there should be an actual attachment. In AIR 1922 Mad 206 it has been laid down by a Bench of this Court as follows:

"No doubt, there was not in our opinion a completed attachment by seizure of any of the plaintiff's property; but that is not material. For the claim, as stated in the plaint, is generally in respect of a completed attachment; and there is in our opinion no doubt that the plaintiff may be entitled to compensation even though the attachment was not completed, if, notwithstanding that he sustained injury by what was actually done. No authority had been adduced by the defendants to show that a completed attachment is necessary. In 30 Mad LJ 180 = (AIR 1917 Mad 145) it was held that a mere procuring an order for attachment before judgment did not afford a cause of action for damages.

Without expressing any opinion as to the correctness of certain points of that decision we can distinguish it from the facts now before us on the ground that they include several acts of the defendants and the Amin, by which injury to the plaintiff has as we shall show been established".

Again in Sadasiv Govind v. Sheduram Sukhdev, the

above decision has been referred to. At page 69, it is stated thus:

"Service of a summons, notice, order of warrant issued by a Court on a party is by itself a process of the Court and it is quite usual and correct to refer to the handing over of the summons, notice, order or warrant as service of the process of the Court. If that be so, speaking for myself I find it extremely difficult to understand why that should not be sufficient, as a matter of law, to complete the cause of action of a Party if he has alleged the necessary elements of the case, by which I mean malice and absence of reasonable and probable cause and special damage and as a general rule, termination of the proceedings in his favour".

16. As against these two decisions, I may refer to ILR 49 Bom 629 = (AIR 1925 Bom 357) which is relied on by the defendant and it states that the mere procuring of an order for attachment before judgment, even though it may have been malicious does not of itself, in the absence of actual attachment levied, afford a cause of action for damages. In ILR (1969) 19 Rai 701 it is held thus "Mere procuring an order of attachment before judgment does not by itself afford a cause of action for damages. A suit for compensation would lie only where the attachment had in fact been effected and not where the attachment has been applied for and has in fact not been levied. The test whether an order of attachment has been levied is not the ascertainment whether the order of attachment was executed but to ascertain whether the process of the Court was applied."

17. On a careful consideration of the above cases, I come to the conclusion that where merely an order of attachment has been procured and nothing more is done in furtherance thereof, the plaintiff cannot complain in a suit for malicious attachment that he has been damnified. In fact no cause of action could arise in favour of the plaintiff. This is the ratio of the decision in Rama Iyer v. Govinda Pillai, ILR 39 Mad 952 = (AIR 1917 Mad 145) and the Division Bench clearly says that procuring an order for attachment before judgment, however malicious does not of itself, afford a cause of action for damages, as damage does not necessarily and naturally flow from an application for attachment before judgment. But in applying this principle, ILR 49 Bom 629 = (AIR 1925 Bom 357) holds that even assuming that the plaintiffs are now entitled to prove that the Bailiff went to the shop to enforce the warrant of attachment and that to prevent the said attachment monies were paid by relative of the plaintiffs as stated in the plaint, such act of the plaintiff does not give any cause of action to the plaintiffs. With great respect, I am unable to share this view, more so in view of the decision in Joseph Nicholas v. Sivarama Iyer. AIR 1922 Mad 206 which passage I have extracted earlier. I also think that if the decision in Joseph Nicholas v. Sivarama Iyer, AIR 1922 Mad 206 had been cited before the learned Judge, he might not have come to this conclusion, I find also from ILR (1969) 19 Rai 701 at page 705 thus:

"The test whether an order of attachment has been levied is not the ascertainment where the order of attachment was executed but to ascertain whether the process of the Court was in fact applied".

In laying down this dictum, reliance was placed on Rama lyer v. Govinda Pillai, ILR 39 Mad 352: Kedarnath y. Bhori Lal, (AIR 1925 Bom 537) = ILR 49 Bom 629 and Sadashiv Govind v. Sheduram Sukhdev, .

18. In the instant case, it is the common case that Bailiff did go to the first plaintiffs' firm and thereupon the amount was Paid and the ratio laid down in Joseph Nicholas v. Sivarama Iyer, AIR1922 Mad 206 would undoubtedly apply.

19. Let me now turn to the other question whether there is any malice on the part of the defendant and further whether he acted without probable or reasonable cause. The background of this case, clearly reveals that the financial position of the first plaintiff firm was far from satisfactory. There were three prior attachments before judgment. One such is for Rs. 414.06 in S. C. S. No. 2220 of 1970. I find that the order of attachment was effected cm 15-4-1970 in M. P. No. 2460 of 1970 which again was a petition for attachment before judgment. Again in I. A. No. 10969 of 1970 in O. S. No. 3592 of 1970 there is an endorsement dated 31-7-1970 thus "Attachment need not be effected, if the defendant pays Rs. 3,000/-" vide Ex. P-29, In I. A. No. 10968 of 1970 in O. S. No. 3591 of 1970 there is an order of attachment before judgment dated 31-7-1970 where again Rs. 1,000/- was paid and the application was not pressed.

20. In addition to the above, it is the admitted case that the claim of the previous partner remained unsettled. With these facts before him the defendant approached his advocate; who was requested to file a suit. The defendant's request for payment under a telegram remained unanswered. His early demands were ineffective. These are the admitted facts. In this background, if a person obtains an order of attachment before judgment I am not persuaded myself to hold that there is no reasonable or probable cause for the same.

21. The learned counsel for the plaintiffs is not correct in his submission when he states that the object of obtaining this attachment before judgment was to enforce speedy payment in view of the statement in Ex. P-5. All that Ex. P-5 states is a mere narration that the defendant is interested in the recovery of the advertisement charges which was not paid for a long time despite repeated demands. From this it cannot be contended that the motive was to enforce speedy payment, and in my view reliance placed on Nanjappa Chettiar v. Ganapathi Goundan, ILR 35 Mad 598 is out of place. Nor again am I inclined to agree with the plaintiffs that this is a case of abuse of the process of Court. It is no use for the plaintiffs to say that the prior attachments were at the time when L.C. Anand was in the management of the restaurant and because of his mismanagement he had to be removed from the partnership. To a third party like the defendant, this can hardly be an answer. Even, otherwise, there is no proof except the interested testimony of P. W. 1 that the defendant was aware about the retirement of Anand or the financial status of the individual partners of the first plaintiff firm. Further, it is in evidence that the relationship between Amarlal and the defendant was far from cordial and it is not possible for the plaintiffs to project the enmity between D. W. 1 and Amarlal into this attachment. I accept the evidence of D. W. 1 when he says that he and his brother-in-law Amarlal are not even on talking terms.

Thus, it is difficult for me to hold that the defendant had any improper or indirect motive in securing the order of attachment before judgment, and therefore I come to the conclusion that there is no malice on the part of the defendant. Accordingly, I answer these issues against the plaintiffs.

22. Issue No. 6: In the result, the suit is dismissed with costs.


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