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Munireddi and Marwadi Motiram Vs. K. Venkata Rao - Court Judgment

LegalCrystal Citation
SubjectCriminal;Property
CourtChennai
Decided On
Reported in17Ind.Cas.544; (1912)23MLJ447
AppellantMunireddi and Marwadi Motiram
RespondentK. Venkata Rao
Excerpt:
- - papayya says that it was broadly rumoured that his suit would fail and the pleader admits that his client told him that the defendants were giving out that the suit would be dismissed. there can be no doubt that the plaintiffs were apprehensive of failure. the pleader, on the other hand, was in a far better position than his client to judge of the chances of success-there can be no doubt that the transfer was a highly speculative one. a fresh partnership deed (exhibit g) was executed in 1900. according to this deed each member of the firm is authorised to sign the name of the firm and the partners of the firm are responsible jointly and severally for the acts of the firm as well as for the acts of each partner and for monies reaching the hands of any one of them. this is a.....sundara aiyar, j.1. in this case two charges were preferred against the 1st grade pleader, first that he trafficked jointly with one marwadi vannajee in an actionable clai|m put into court obtained by yadalla pichayya and papayya against the minor heirs of one virabhadrappa in a suit in which he was plaintiff's vakil; secondly, that he had been and was engaged in trade under the name of k.v.s. ramchander and co. the district judge mr. b.c. smith in his report to this court has found both the charges proved. after full consideration of the evidence on record i concur in the findings arrived at by the district judge. it is not necessary to do more than to refer very briefly to the evidence in support of the charges.2. 1st charge. on the 7th september 1909 an agreement was entered into.....
Judgment:

Sundara Aiyar, J.

1. In this case two charges were preferred against the 1st grade pleader, first that he trafficked jointly with one Marwadi Vannajee in an actionable clai|m put into Court obtained by Yadalla Pichayya and Papayya against the minor heirs of one Virabhadrappa in a suit in which he was plaintiff's vakil; secondly, that he had been and was engaged in trade under the name of K.V.S. Ramchander and Co. The District Judge Mr. B.C. Smith in his report to this Court has found both the charges proved. After full consideration of the evidence on record I concur in the findings arrived at by the District Judge. It is not necessary to do more than to refer very briefly to the evidence in support of the charges.

2. 1st charge. On the 7th September 1909 an agreement was entered into between Pichayya and Papayya the plaintiffs in O.S. No. 3 of 10 on the file of the Subordinate Judge's Court of Bellary on the one hand and Vannajee on the other hand for the transfer of the claim of the former in O.S. No. 3 of 1910 which was then pending for a sum of Rs. 4,750. The amount claimed was about Rs. 10,000. The evidence in the suit had been recorded but judgment had not been delivered. The transferee Vannajee was to take all risk of loss in case the suit was dismissed. The 1st grade pleader represented the plaintiffs in the suit. According to the evidence of Papayya one of the transferors, his fee for the suit had been paid prior to the transfer. The case of the petitioner who made the complaint against the 1st grade pleader is that the transfer was wholly or partially for the benefit of the pleader himself. The most important fact proved against the pleader is that half of the profit which Vannajee made out of the bargain was paid to him. Vannajee sold his claim to one Veerabhadrappa, the 2nd witness for the petitioner, for Rs. 6,392-8-0. The profit made by Vannajee according to himself was Rs. 1571-4-0 and of this amount, exactly one half i.e. Rs. 785-10-0 was received by the pleader. A sum of Rs. 70-12-0 was deducted out of the total amount of Rs. 6,392-8-0 as the interest on the loan contracted by Vannajee at 6 % per annum for the consideration paid by him for the transfer. The amount was borrowed from the firm of a banker S. Donga Chand. It is not denied that the pleader became responsible to the banker for the payment of the amount. The pleader's case is that he merely became surety to the banker for the loan which Vannajee took from him. Vannajee was the Gumastah of one Kannajee. The pleader gave a letter or chit to Vannajee addressed to the banker. This letter was dated 9th September 1909. It is stated on behalf of the pleader that the money had been paid by the banker to Vannajee on the 7th before he gave the letter. 1st witness for the petitioner, Sivaraj, a partner of the banker, states that the banker's account contains an entry dated 7th September 1909 debiting Kannaji through Vannajee with Rs. 4,000. On the 9th September the debit was transferred to the pleader, Kannajee being credited with the amount on that date. This might go to show that the pleader's connection with the loan commenced only after it was actually advanced by the banker but the inference doss not necessarily follow. The reason for the alteration of the entry was that Vannajee objected to the entry in the name of Kannajee as he claimed the benefit of the transfer of the claim himself. It is quite clear that on the 9th it was agreed I that the pleader should be regarded as the person mainly responsible to the banker for the payment of the loan. Now why did the pleader agree to make himself responsible for the amount? The answer suggested by the payment of half the profits to him undoubtedly is that it was understood that he and Vannajee should go shares in the bargain. The pleader in his written statement does not give any explanation of his receipt of Rs. 785-10-0. He merely denies the allegation that he was interested in the purchase of the claim and states that there was nothing against law, rules or public policy even if he was interested in it. After the witnesses in the present proceedings were examined the pleader made another short statement (not on oath) and offered himself for cross-examination. He gave no explanation of the receipt of Rs. 785-10-0 in this statement either. In cross-examination he admitted his receipt of the amount (the payment being made directly to his father-in-law). He also stated 'this Rs. 785-10-0 might have been partly remuneration for spending my time in negotiating the transaction and preparing the necessary documents. I have no account to show the sum due for each piece of work done.' This affords no satisfactory explanation. He does not say that the whole amount was paid for his services in bringing about the transfer. He admits that the amount was hot entered in his accounts as fees and gives an extraordinary explanation that only remuneration for work done in court is entered as fees in his accounts. He entered the amount under family earnings. Papayya the transferor of the claim says that he. had paid to the pleader the fee due to him for the conduct of the suit. This is likely as the case was almost ripe for judgment when the transfer was made. If the amount was not paid as fees due for professional work then the payment must have been on account of a half share possessed by the pleader in the claim by virtue of the transfer. Van-najee who tries to support the pleader as much as he can is equally unable to show how the amount of Rs. 785-10-0 was made up. He tries to make out that he promised to pay the pleader his fee and a present but he could not give any explanation as to how the fee would amount to Rs. 785-10-0. He admits that that amount was paid to the pleader. He says that the interest payable on the loan was 1 annas and not 6% so as to throw doubt on the amount available for division between him and the pleader. But he admits that the profit made out of the transaction was Rs. 1,571-4-0 and he also admits that he charged the pleader 8 annas per Rs. 100 interest on his whole account including this sum of Rs. 4,000. There is absolutely nothing to support his statement that T annas and not be was the interest payable on the loan. In the absence of any explanation forthcoming from the pleader I have no doubt that the Judge was justified in coming to the conclusion that it was agreed between him and Vannajee that he should receive half the profits arising from the transfer of the claim. It is immaterial ts consider whether he became interested in the transfer on the 7th September, or only on the 9th. The Judge's conclusion is strongly supported by the evidence of the petitioner's 2nd witness who purchased the claim from Vannajee. He states that he negotiated the purchase with the pleader without any reference to Vannajee and that the payment of the consideration was made to the latter at the instance of the former. Papayya who does not admit that the pleader had a share in the claim admits that the negotiations for the transfer to Vannajee took place at the pleader's house.

3. The next question is whether the pleader's act in purchasing the claim amounts to grossly unprofessional miscondcut within the meaning of Section 13 of the Legal Practitioners' Act. The claim was then the subject matter of a suit in which the pleader appeared for the plaintiff. The defendants in the suit possessed large properties bat were in involved circumstances. Papayya says that it was broadly rumoured that his suit would fail and the pleader admits that his client told him that the defendants were giving out that the suit would be dismissed. There can be no doubt that the plaintiffs were apprehensive of failure. The pleader, on the other hand, was in a far better position than his client to judge of the chances of success-There can be no doubt that the transfer was a highly speculative one. There is no force whatever in the contention that the claim ceased to be actionable because a suit had been instituted for its enforcement. That fact is absolutely immaterial according to the definition of'actionable claim'in Section 3 of the Transfer of Property Act. The old definition contained in Section 130 of Act IV 1882 and Clause (d) of Section 135 as it originally stood put this beyond a doubt. Mr. Rangachariar on behalf of the pleader contends that a purchase of an actionable claim is not necessarily unprofessional conduct. Mr. K. Srinivasa Aiyangar, who appears on behalf of the Vakils' Association, supports this argument. I am quite unable to accept this contention. Section 136 enacts as follows 'No Judge, legal practitioner or officer connected with any Court of justice shall buy or traffic in or stipulate for, or agree to receive, any share of, or interest in, any actionable claim and no Court of justice shall enforce at his intance or at the instance of any person claiming by or through him any actionable claim, so dealt with by him as aforesaid.' It does not merely make purchases of actionable claims by the classes of persons named in it unenforceable in law. It expressly prohibits them from being interested in any transfer of an actionable claim-The prohibition is based on the ground of the offices held by them. I cannot doubt that the doing of an act which a legal practitioner is forbidden to do on the ground that he is a legal practitioner is a violation of the conduct that he should pursue as a practitioner and therefore unprofessional conduct. It is urged that the legislature could not have intended to make the purchase of an actionable claim by a pleader under all circumstances unprofessional conduct, that in other countries there is no such absolute prohibition, that the New York Civil Procedure Code forbids purchases of actionable claims and negotiable instruments only where it is made 'with the intention and for the purposes of bringing a suit thereon,' and that in the French Civil Code the prohibition is confined to claims falling within the jurisdiction of the Court where the pleader is practising. The language of Section 136 of Act IV of 1882 is in my opinion absolutely clear. It is quite immaterial that the Indian Legislature considered it expedient to enact the rule in wider terms than the legislatures of some other countries have done. It being clear that the pleader's act amounted to professional misconduct, was it grossly unprofessional? I have no doubt that it was. I have already referred to the circumstances under which the transfer was made. The Court of First Instance r.s a matter of fact passed a decree for about Rs. 11,000 though the amount was reduced to Rs. 6,000 and odd in appeal. The purchase amounted in this case to trafficking in litigation. It is unnecessary to decide the question whether the purchase of an actionable claim though unprofessional must amount to grossly unprofessional misconduct in every case. Undoubtedly the onus would be on the pleader who purchases an actionable -claim to show that in the circumstancss of any particular case it does not amount to gross misconduct. I think that it would not be improper to hold that pleaders should not be permitted to do acts that are liable to subject them to severe temptation. I am of opinion that this charge has been proved against the pleader. I agree with the learned Chief Justice as to the punishment that should be imposed.

4. The 2nd charge:--The facts relating to this charge are practically undisputed. The pleader belongs to a wealthy family possessed of various kinds of properties including landed estates, houses, directorships in companies, Secretaryship in one Company, an agency under the Oriental Life Insurance Co., some other trade agencies, shares in joint stock Companies and a mill at Bellary known by the name of Medum Seshanna Cotton Manufactory. The evidence of Srinivasa Row, the pleader's brother and himself a pleader, shows that in 1894 the members of the family entered into a partnership. A fresh partnership deed (Exhibit G) was executed in 1900. According to this deed each member of the firm is authorised to sign the name of the firm and the partners of the firm are responsible jointly and severally for the acts of the firm as well as for the acts of each partner and for monies reaching the hands of any one of them. The pleader states in his written statement 'the members of the firm supervised the work of the managers and agents whenever they have leisure and during holidays.' He denies that he has engaged himself in trade. In the face of the admitted facts, I am of opinion that the denial is absolutely untenable. It is contended that the actual work of the trade is done by clerks and agent and that therefore that pleader cannot be said to be personally carrying on trade. I am quite unable to agree that the mere appointment of servants or agents is sufficient to show that the trade is not carried on personally by the pleader. In that case any trader who is able to engage clerks and to dispense with attending to customers himself may say that he is not personally engaged in his trade. It is not denied that the agents and managers could be dismissed at pleasure by the pleader and his partners. The admission that the members of the firm supervised their work puts an end to all doubt on the matter. It is contended by Mr. Rangachariar that a pleader who belongs to a trading family should not be regarded as trading, simply because other members carry on trade, the benefit of which would go to all the members of the family including the pleader. I agree with him so far. It is quite true that every member of an undivided Hindu family cannot be said to be carrying on a trade the benefit of which would go to the family. One member of it alone may be carrying on the trade but he may do so with family funds. Although as between the members of the family the profit or the loss must be shared by all of them, it would not follow that every one of them is conducting the trade. Again two or more members may alone carry on a trade as partners and the outside public may be dealing with them alone though as amongst the members of the family inter se all might be responsible for the result of the trade. But if all the members enter into a partnership and carry on a family trade as partners then all of them must be regarded as carrying on the trade. This is a distinction well understood in law. In the present case the pleader who is the senior member of his family has entered into a partnership with the other members. He as much as any other member of the family is trading with the outside public whatever may be the actual amount of work done by him in connection with the management of the trade. I hold therefore that the pleader must be held to be personally engaged both in trade and in the other business referred to in the deed of partnership. It is then argued that carrying on a trade is not professional misconduct within the meaning of Section 13 of the Legal Practitioners' Act and that there is Rule 27 of the rules framed under the Act is in these terms. 'If any person, having been admitted as pleader, accepts any appointment under Government, becomes a student of any school or college for purpose of pursuing his studies or enters into any trade or other business, or accepts employment as a Law Agent other than a pleader, Mukhtar or Agent certified under Act XVIII of 1879 and these rules, he shall give immediate notice thereof to the High Court, who may thereupon suspend such pleader from practice or pass such orders as the said Court may think fit.' It is true that engaging in trade or othsr business is not definitely pronounced to be misconduct by this rule. According to it the High Court may give permission to any pleader, if it thinks fit to do so, to engage himself in any particular trade or business. A similar rule has been framed under the Letters Patent of the High Court with respect to High Court Vakils although curiously enough no such rule has been framed applicable to advocates and attorneys.- The pleader was undoubtedly guilty of misconduot in not obtaining the permission of the High Court for carrying on trade or other business. He has been engaged in trading business of an important character and it was undoubtedly his duty to apply for and obtain the High Court's permission. No charge however has been framed against him of violating the provisions of Clause 27 which require him to apply for permission to the High Court and I do not, think we should find him guilty of misconduct in violating the provisions of this clause without his having an opportunity to explain his conduct. But it does not follow from this that he is not guilty of misconduct by being engaged in trade or other business without the permission of the Court, if his doing so is inconsistent with the profession of a pleader. The rule enables pleaders to avoid all risk of being pronounced guilty of misconduct by obtaining the opinion of the High Court with respect to any business they may propose to undertake but the failure to take advantage of the provisions of the rule cannot absolve them from liability to be convicted of misconduct if they act in a manner consistent with their profession. It seems to me that there are two reasons why carrying on trade may be inconsistent with the profession of a pleader. One reason is that it might prevent him from devoting that attention to his work as a pleader which, his duty to the public and to the Court require that he should. But another and certainly not less important reason is that a pleader should not be permitted to engage himself in any pursuit which is inconsistent with his status as a member of a learned and honourable profession. In England every person who wishes to be called to the bar has to state that he is not and has never since his admission as a student 'been engaged in trade and that he is not an undischarged bankrupt.' I am not aware that according to the rules of the bar in England a Barrister can be punished for being engaged in any trade or business inconsistent with his being actively engaged in the practice of his profession, though there are various offices the holding of which is deemed to be inconsistent with practice as a Barrister. See page 384 of Halsbury's Laws of England Vol. II. But I strongly believe that carrying on a trade would be deemed to be generally inconsistent with the active practice of the profession of either a Barrister or an attorney. To do so may not be in some' cases inconsistent with the status itself of a legal practitioner. He would probably not be punished for having been engaged in trade or other business if he was not practising his profession at the same time, although it is probable, I think, that there are some trades and businesses which may be regarded as altogether inconsistent with the status of an Advocate However as the rules stand it would be open to this Court to permit any particular trade or business being undertaken by a pleader. There might certainly be some kinds of business which would in no way be inconsistent with either the status or the active practice of -1 pleader's profession. There have been instances where engagement even in a trade has also been permitted by this Court although I take it that this would not ordinarily be allowed. It may be that there are enterprises which, having regard to the circumstances of this country, the Court would sanction a pleader actively promoting and devoting a portion of his time to. Whether sanction should be given in any case would no doubt largely depend on the character of the trade or business and the extent to which it is likely to occupy the time and attention of the pleader. But no pleader can be permitted to derive any advantage by taking the responsibility on himself and engaging in a trade or business without the sanction of the Court. If he does so he takes the risk of its being subsequently held that this conduct amounts to professional misconduct. If permission would not have been given if he had asked for it, he must be held guilty of misconduct in having done that which the Court would not have sanctioned. This is the rule followed where a trustee acts without the sanction of the court in a matter for which he could have obtained its permission. I do not consider it possible that the court would have given permission to the pleader in this case to be engaged as a partner of a large cotton mill and in the various other businesses which the pleader admits to be included in the concerns of the partnership. It is, however, possible that he thought, as he says he did, that inasmuch as he would not have to devote much of his time personally to his work as a partner he was not acting in violation of his duty as a pleader. I am willing to believe that he acted bona fide and without any intention to act contrary to his duty as a professional man. I am therefore of opinion that it is sufficient to point out that he acted, wrongly and that it is unnecessary to impose any punishment on him for his conductin this matter.

5. Referred Case No. 9 of 1912.

Sankaran Nair J.

6. I think that Mr. Rangachariar is right in his contention that any charge against the pleader must be proved by evidence taken at this enquiry. But I do not accept the further contention that the judgment in the civil suit is inadmissible in evidence. The pleader was the defendant in that suit. It was decided therein that the plaintiff had paid him his fee to appear for him at the sessions; that he failed to appear without making any arrangement for the conduct of the case : a decree was passed against him on these findings. The facts found against him must be taken prima facie, to be proved. At the same time I think it is open to him to show that the judgment is wrong and should not be accepted as final for the purpose of this enquiry. Any evidence which should have been but was not produced in the suit will of course be viewed with grave suspicion. Nor is it clear to me why it is not open to us at this enquiry, to consider whether the judgment is right on the materials on which it was based. There is no law preventing us from doing so and I see no injustice in it.

7. I think therefore the Judge is right in allowing the pleader to give further evidence. On the evidence Exhibit A the receipt given by the pleader to Muni Eeddi makes it clear that he was bound to defend him at the Sessions. I doubt whether it is open to him to say in this enquiry after giving that receipt, unless he proves mistake or some other invalidating circumstance, anything against that receipt. Because as a pleader it was his duty to grant a proper receipt and not one which is misleading. He has however failed to prove that he did not agree to appear at the Sessions. I do not attach any weight to the other contention that the vakil was not bound to appear as his clieno owed him a portion of his fee. He has failed to prove that any balance is due.

8. I am also of opinion that a vakil is bound to appear and conduct his case even if the fee or any portion thereof remains unpaid, in the absence of any agreement to the contrary or at least notice to the effect to the client in sufficient time to enable him to make other arrangements.

9. Mr. Rangachariar argues that a pleader like Mr. Venkata Row would not have failed to make some arrangement about his case before going to Rangoon. There is great force in this argument. Mr Venkata Row appears to have made arrangements about all other cases. The only explanation that suggests itself to me;is that he may have really thought that he was not bound to appear, for Muni Reddi at the Sessions. This is supported by; the facts that the counterfoil of the receipt kept by him showed that he was to appear only before the Magistrate and this Srinivas Row told Subba Row that Mr. Venkata Row was not engaged to defend Muni Reddi. What took place at the meeting in September between Muni Reddi and the vakil also supports this view. I think that Venkata Row believed that he was not engaged to defend Muni Reddi at the Sessions. If he had pleaded in this enquiry after the disposal of the appeal, that he acted in this erroneous but honest belief and tendered a proper apology, speaking for myself, the result might have been different. But he has persisted in this enquiry in trying to prove a defence already found false in a Civil Suit. I agree accordingly to the order which will be pronounced by the Chief Justice.

10. Referred Case No. 10 of 1912.

11. The charge against the pleader Mr. Venkata Rao is that he purchased the claim of the plaintiff in Original suit No. 8 of 1909 on the file of the Subordinate Judge's Court of Bellary. That was a suit brought by Pichayya and Papayya against certain minors for the recovery of a sum pf more than Rs. 11,000. After evidence had been heard, but before judgment was pronounced one Vannaji agreed to purchase the claim of the plaintiffs therein for Rs. 4,750 on 7th September 1909. Now, it appears from the evidence of the vendor, who is the prosecution 4th witness in the case, that so far as he is concerned he had nothing to do with Mr. Venkata Rao and that, though the negotiations for the sale took place in Venkata Rao's house, the claim was agreed to be sold to Vannaji who was his client without any consultation with Venkata Rao. Vannaji borrowed Rs. 4,000 of this amount from the firm of Satraji Dongerchund. Anadaji who was examined as a witness for Venkata Rao was a partner in that firm. It appears from his evidence, which there is no reason to disbelieve, that when the firm lent Rs. 4,000 to Vannaji, the amount was debited against one Bhataji Khemaji who was the principal of Vannaji; two days later Vannaji told this witness that it should have been debited against him and not against his principal; he refused to do so; then Vannaji got a letter from Mr. Venkata Rao asking him to debit that amount against Venkata Rao's account and that was accordingly done. Mr. Venkata Rao admits having written a letter to the firm asking them to do so. The entry was made by the prosecution 1st witness and he also gives evidence to the same effect.

12. On the 7th of December, Vannaji sold the decree to one Veerabhadrappa. Veerabhadrappa was a relative of the defendants in that suit and was naturally interested in them. He says that he heard a rumour that Mr. Venkata Rao had purchased that decree and that he spoke to him and arranged to purchase the decree from him; he paid Rs. 6,392-8-0 to Venkata Rao and got an assignment of the decree from the original decree-holder Papiah who had agreed to sell it to Vannaji. The money was actually paid to Vannaji as Venkata Rao directed him to do so. According to this witness he never saw Vannaji at all while the negotiations were going on. If the matter had stopped here the case would have been one of suspicion only.

13. But there is the following additional circumstance to be taken into consideration. The entire amount borrowed by Vannaji was Rs. 4750. Now, this with interest at 6 per cent, per annum for three months, that is the period between September 7, the date of agreement of sale to Vannaji and December 7, the sale of the decree to Veerabhadrappa, would come to Rs. 4,821-4-0. The difference between the two amounts Rs. 6,394-8-0 and Rs. 4,821-4-0 i.e., 1,571-4-0 is the profit and half of this is Rs. 785-10-0.

14. Now, it appears from the evidence and it is admitted that this amount, i e., Rs. 785-10-0, was paid on Venkata Rao's account to his father-in-law. It is not explained how this particular sum of exactly half of the profits was due to Venkata Rao. He gives no explanation, he produces no account to show that this was due to him for any fee. There is evidence that the interest payable on the sum of Rs. 4,000 was at 6 per cent. The evidence as to the rate of interest payable on the remaining Rs. 750 is discrepant and it is not clear what the real interest was; but there is nothing improbable in their setting apart interest at 6 per cent, for 3 months for the purpose of calculating profits on the transaction. In the absence of any explanation on the part of Venkata Rao the only conclusion that we are justified in drawing is that he received it as his share of the profits of the transaction; and taken with the other circumstances of the case his advancing the money to Vannaji and the facts disclosed by the prosecution 2nd witness whose evidence is strongly corroborated by these two facts, I come to the conclusion that from the 9th September 1909 Venkata Rao must be treated as a partner, with Vannaji and equally interested with him in the decree.

15. The question then remains for consideration whether this is grossly improper conduct in the discharge of professional duties.

16. An actionable claim should not be purchased by a pleader and in my opinion the purchase of a claim after suit offends against public policy more than the purchase of such a claim before suit. It is trafficking in litigation and when the vendor is the client of the purchaser, the transaction in the majority of cases is likely, to be oppressive to the client. In the case before us, however, not only no undue advantage has been taken but Venkata Rao seems to have acted fairly. Papiah offered to accept Rs. 4,000 from Veerabhadra-ppa in full satisfaction of his claim and he got from Vannaji and Venkata Rao Rs. 4,750. Further Venkata Rao did not deal with the client and was not in fact the original purchaser on the 7th. It is also proved that a portion of the interest due to the minor was remitted. As this is the first case of the kind that has come before this Court, a lenient view might have been taken of the case, if he had pleaded good faith and placed before the Court all the facts. He has not chosen the course. I agree to the order which will be pronounced by his Lordship the Chief Justice.

17. The next charge against Mr. Venkata Rao is that he has been trading in cotton and yarn with the other undivided members of his family as partners. That he is a partner with them is proved beyond doubt by Exhibit G. The Company has also bought a spinning mill in Bellary, borrowed money to pay for it and to cover working expenses; it was buying cotton and selling yarn. There are no doubt, managers and gumastas appointed but Venkata Rao and his brother do not cease to be persons carrying on trade any the less on that account. Holding then, that Venkata Rao and his brothers are traders, the question remains whether he is guilty of any grossly unprofessional conduct. Rule 27 of the rules framed by the High Court under the legal Practitioners' Act XVIII of 1879, runs thus:

18. 'If any person, having been admitted as pleader, accepts any appointment under Government, becomes a student of any school or college for purposes of pursuing his studies or enters into any trade or other business, or accepts employment as a Law Agent other than a pleader, mukhtar, or Agent certified under Act XVIII of 1879 and these rules, he shall give immediate notice thereof to the High Court, who may thereupon suspend such pleader from practice or pass such orders as the said Court may think fit.

19. 'Provided that when a pleader is appointed by or under the authority of the High Court to the office of District Munsif, whether temporarily or permanently, it shall not be necessary to give the notice prescribed in the first part of this rule; but no pleader, while employed as District Munsif, shall be permitted to practise or do any business as a pleader before any Court.'

20. Now it will be noticed that the High Court can take action under this rule only if the pleader who enters into any trade or business gives notice to the High Court. Under the rule he is bound to give such notice. Then, Section 13 of the Act itself empowers the High Court to punish the pleader in certain circumstances. The words of the section run thus:--?' The High Court may also, after such enquiry as it thinks fit, suspend or dismiss any pleader holding a certificate as aforesaid.

(b) who is guilty of fraudulent or grossly improper conduct in the discharge of his professional duty, or

(b) for any other reasonable cause.

21. The omission to comply with Rule 27 by a pleader 'would probably come under Clause (b). It would certainly come under Clause (f). If, therefore, a First Grade Pleader omits to make the application which he is bound to submit to the High Court under Rule 27, then he may be suspended under Section 13 for breach of that rule until he makes the application under that section or any further time the High Court thinks fit. If he makes the application under Rule 27, then he can be dealt with under that rule. Apparently therefore the rule and the section provide adequate remedy for all cases. Whether the pleader should be suspended or should be allowed to carry on a trade under Rule 27 depends upon the particular circumstances of each case : the character of the person making the application, the nature of the trade or business, the time that the pleader would have to devote to it. There may also arise other considerations. The trade or business may be one which it may be in public interests to foster in that locality and men other than pleaders may not be available perhaps to carry on the trade or business satisfactorily. Under this rule, applications are being made to the High Court for sanction and they have been granted or rejected according to the particular circumstances of the case. If we lay down a definite rule under Section 13 of the Act, it would be depriving the High Court of the discretion vested in it by Rule 27; for, it is obvious that once a pleader is declared to be disqualified from engaging in any trade or in any particular kind of trade, it would not be right for the High Court to give any sanction under Rule 27 to any other pleader applying for it. I am not therefore able to say that under Section 13, the High Court should declare that it is unprofessional for a pleader to follow any trade or business. It is not required by the conditions of the Legal profession or the circumstances of the country.

22. It may be a question whether any rule even is necessary, because the evil to be guarded against cannot be serious as the sanads of the First Grade Pleaders have to be renewed every year and the High Court may refuse a renewal. But, in any event, I do not think it necessary that we should take any action under Section 13 as against any pleaders to whom Rule 27 is applicable. I am also of opinion that it is difficult now to say generally that a pleader should not engage in any trade or business. Confining myself now only to Vakils they exercise the profession both of the Advocate and the Solicitor and they should not be debarred from performing those functions which a Solicitor is and a Barrister may not be, entitled to discharge. Many, if not the majority, of the pleaders are members of joint families who are engaged in trades or businesses. It would be an unnecessary interference with them now to declare that such trades or businesses are unprofessional. The notion that no trade however honestly carried on is worthy of a Vakil is a relic of the times that have passed away and I should regret its introduction into India.

23. On the facts before us, there is no doubt Mr. Venkata Rao has been guilty of a violation of Rule 27 in not having reported to the High Court his connection with the firm or with the mill. But he has not been charged with having violated that rule and we cannot take any notice of it as he has had no opportunity of making any answer to that charge. So far, therefore, as the second charge is concerned I am not prepared to inflict any punishment on him.

24. Referred Gases Nos. 9 and 10 of 1912.

Ralph Sillery Benson, O.C.J.

24. I concur with the conclusions arrived at by my learned brothers in the judgments which have just been read and which I have had the advantage of perusing.

25. With regard to the charge in connection with the Criminal Case against Muni Reddi, I am unable to accede to Mr. Rangachariar's contention that the judgment and evidence in the Civil suit against the Pleader, Mr. Venkata Rao, is not admissible as evidence against him in the present proceedings. The question in that suit was the very question which we now have to decide, viz., whether he engaged to defend Muni Reddi in the Sessions Case and failed to do so without any valid excuse. Mr. Venkata Rao was the defendant in the case and the decision was against him.

26. I do not think that the decision is conclusive proof against him in the present proceedings, but it has not been treated as conclusive. He has been allowed in the present proceedings to produce further evidence in support of his defence and he has produced it and it has been duly considered by the District Judge and by us. There is no suggestion that, any evidence which the pleader wished to adduce in the present proceedings has been shut out. We have not been referred to any authority for holding that the judgment is inadmissible in the present proceedings as establishing a prima facie case of unprofessional conduct against the pleader or for holding that we are precluded from considering whether the judgment is right on the evidence on which it was based, nor do I see any ground in reason why we should treat them as inadmissible.

27. On the merits, the evidence and probabilities in all these cases have been so fully considered in the judgments of the two District Judges and of my learned brothers that I do not think anything would be gained by my reviewing them afresh. I entirely agree with the conclusions at which my learned brothers have arrived.

28. I do not understand how it can be seriously argued that what the pleader is said to have purchased from the plaintiffs in Original Suit No. 3 of 1909 was not 'an actionable claim,' and that there was nothing contrary to law or public policy in his purchasing it, if he did do so and, therefore, his doing so was no professional misconduct. The plaintiff's claim had, no doubt, been put in action, but that did not render it the less an 'actionable claim' as defined in Section 3 of the Transfer of Property Act. The claim was still sub judice. Though the case was ripe for judgment it had not been given. The claim had not become merged in a decree. Section 136 of the Transfer of Property Act in the most stringent terms declares that 'no judge, legal practitioner or officer connected with any Court of Justice shall buy or traffic in or stipulate for, oraagree to receive, any share of, or interest in, any actionable claim.' A pleader holds a privileged position in connection with the administration of justice and the law imposes on him certain restrictions and disabilities by reason of the position or office which he holds and in order to safeguard the interests of litigants and the pure administration of justice.

29. It is, I think, futile to contend that it is not professional misconduct for a man to do that which the law expressly forbids him to do by reason of the profession which he exercises. The degree of misconduct will, no doubt, vary with the circumstances of each case, but I cannot doubt that a transaction such as that with which we are now concerned amounts to gross misconduct. The pleader who is conducting a case is in a better position than his client to judge of the probability of his success or failure and the nearer the case is to judgment the greater will be his opportunity for correctly anticipating the event. It may be that when a case is ripe for judgment there is no longer any temptation to the pleader to conduct the case impro perly, but to allow him at that stage to purchase his clients's claim would expose him to a strong temptation to misrepresent to his client his prospects of success and the value of his claim. In the present case the transaction was a highly speculative one. The evidence shows that the plaintiffs feared their suit would be dismissed and were willing, at one time to sell their claim for Rs. 4,000. They in fact, got a decree for Rs. 11,000 in the Original Court, though this was reduced on appeal to Rs. 6,000. It is true there is no suggestion that the pleader made any misrepresentation to his elients in this case and the plaintiffs were satisfied with the price (Rs,4,750) paid to them, but this does not prevent the pleader's purchase of the claim, in defiance of the express provisions of law, from being professional misconduct of a very grave character.

30. It only remains for me to state the decision at which we have arrived as to the penalty we should impose under Section 13 of the Legal Practitioners' Act on Mr. Venkata Rao in respect of the charges which have been established against him. He cannot plead youth or inexperience in extenuation of his misconduct. Its gravity has certainly not been lessened by the false defences which he has put forward and maintained throughout in regard to the charges relating to his conduct in connection with the criminal case against Muni Reddi and in purchasing his own client's claim in Original Suit No. 3 of 1909 in the Subordinate Judge's Court. We do not think that a mere warning or censure would suffice to mark our sense of the gravity of his misconduct in either of these cases. We think that we are required to impose a penalty of a substantial period of suspension in each case. We accordingly direct that Mr. K. Venkata Rao be suspended from the exercise of his profession as a pleader for six months and three months on account of his misconduct in regard to these two cases respectively, the two periods to run consecutively.

31. We do not think it necessary to impose any penalty in connection with the charge against him for engaging in trade. We think it sufficient to say that he was wrong in carrying on trade without reporting the fact to the High Court under Rule 28 of the Rules made by the Court under the Legal Practitioners' Act 18 of 1879.

32. The pleader will have to pay the costs of the Petitioner in Referred Case No. 10 of 1912.


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