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M.R. Natarajan Vs. Gnanambal Ammal - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Case NumberC.R.P. No. 298 of 1981
Judge
Reported inAIR1983Mad184
ActsCode of Civil Procedure (CPC), 1908 - Order 3, Rule 4 - Order 23, Rule 3
AppellantM.R. Natarajan
RespondentGnanambal Ammal
Appellant AdvocateT.V. Ramanujam, Adv.
Respondent AdvocateR.S. Venkatachari, Adv.
Cases ReferredMadras v. C. Ramalingam
Excerpt:
.....upon and if the amount was not paid within the time stipulated the sit was to be dismissed. the compromise memo was signed by the plaintiff his advocate and the advocate for the defendent. in pursuance of the said compromise decree the plaintiff filed an execution petition for directing the defendant to execute the sale. the trial court took the view that the compromise which was signed by the advocate for the defendant and not by the defendant would not be binding on the defendant and dismissed the execution petition. the plaintiff preferred a revision before the high court.;the question that arose for consideration was whether the advocate for the defendant was competant to enter into a compromise on behalf of his clients the defendant and whether the executing court can't to behind..........signed by the parties. as i have observed already, the court which has passed the decree on the memo of compromise must be deemed to have applied its mind and satisfied with regard to the compromise entered into between the parties to the suit. hence the question as to whether the compromise memo has to be signed by the defendant also apart from her advocate will not arise on the facts and circumstances of the present case. nevertheless, we can look into these decisions for the completeness of the present case.12. in employers in relation to monoharbahal colliery; calcutta v. k. n. mishra, , the supreme court had occasion to deal with a case wherein the memorandum of compromise was signed by the advocate alone in the appellate stage. when the supreme court found that the counsel was.....
Judgment:
1. The plaintiff in O. S. No. 3850 of 1974 on the file of the City Civil Court, Madras, is the petitioner herein. He filed the suit for directing the defendant to execute the sale deed in respect of the suit property in favour of the plaintiff on receipt of the balance of the purchase price of Rs. 7,900 after duly cancelling and registering the security bond with the Register of Assurance within the time that may be specified by the court.

2. There was a compromise both in O. S. No. 3050 of 1974 and in O. S. NO. 7657 of 1976. According to the said compromise, the defendant in the suit has to execute the sale deed in favour of the plaintiff in respect of the suit property at the cost of the plaintiff on payment of a sum of Rs. 10,220 made up of Rs. 7,900 being the balance of sale price and Rs. 2320 being the arrears of rent. The amount has to be paid on or before 31-3-1979. The compromise decree further states that in default of payment of Rs. 10,220, on or before 31-5-1979, the suit will stand dismissed. The compromise memo was signed by the plaintiff, his advocate and the defendant's advocate and one S. Natarajan. The defendant has not signed the compromise memo. In pursuance of the said compromise memo the plaintiff filed E. P. 380 of 1980 for directing the defendant to execute and register the sale deed in respect of the suit house and in default, the executing court may be pleased to execute and register the sale deed in favour of the plaintiff under O. 21, R. 34, C.P.C.

3. The defendant filed a counter in the said execution petition, inter alia, alleging that there is no valid endorsement of compromise on the memorandum of the plaint, that the defendant has not agreed to the terms of the compromise, that the compromise without his signature is not binding on him, that the advocate appeared on his behalf was not authorised to enter into such compromise, that the compromise decree as such is not binding and that the execution petition has to be dismissed. He has further alleged that the condition of the compromise in respect of the payment of the money has not been complied with and as such the decree is not executable.

4. The Executing Court found that the money had been deposited as per the terms of the compromise decree, but since the compromise memo is not signed by the defendant, the decree is not executable. With these findings, the executing court dismissed the petition. As against this order of dismissal, the plaintiff has preferred the above revision.

5. Mr. T. V. Ramanujam, the learned counsel appearing for the revision petitioner-plaintiff, submitted that the executing court cannot go behind the decree and the only remedy open to the defendant will be to pray for setting aside the compromise decree by an appropriate suit. It is further submitted that the executing court can refuse to execute the decree only if the decree is a nullity or the court which passed the decree has no jurisdiction. According to him, the present compromise decree cannot be construed as a nullity and the court which passed the decree had ample jurisdiction to pass such a decree. It is also submitted by him that the advocate who appeared for the defendant in the trial court had implied authority to compromise and unless such authority is specifically revoked, the compromise memo signed by the advocate for the defendant is valid.

6. Mr. R. S. Venkatachari, learned counsel for the

respondent-defendant, reading O. 23, R. 3. C.P.C., after its amendment by S. 74 (5) (iii) (a) by Act 104 of 1976 submits that the compromise to be valid must be in writing and signed by the parties, to the suit. It is further submitted by him that in the vakalat given to the advocate concerned, as far as the City Civil Court is concerned, there is absolutely no power given to the advocate to compromise a matter. Finally, he submits that the money deposited into court without paying to the defendant is fatal to the compromise decree and as such, the compromise decree is not executable.

7. In reply, Mr. T. V. Ramanujam submitted that the provision of O. 23, R. 3, C.P.C as it stood before its amendment alone will be applicable to the facts of the present case since the proceedings in this case were started much earlier to the amendment made to the Code of Civil Procedure by Act 104 of 1976. To substantiate his contention the learned counsel reads S. 97 (2) (a) of Act 104 of 1976, which reads as follows :-

"The amendment as well as substitution, in O. XXIII of the First Schedule by S. 74 of this Act shall not apply to any suit or proceeding pending before the commencement of the said S. 74."

Both the counsel have cited a number of decisions to support their respective contentions which I will presently look into. In Addisons Paints and Chemicals Ltd. v. M/s. Sant Ram Parma Nand. , a single Judge of the Delhi High Court held that the court executing the decree is not competent to embark on an enquiry into facts which if established will tend to show that the Court passing the decree will have no jurisdiction to do so. In that decision, it has been further held that the executing court can only go into the question whether or not the decree is a nullity, where on the face of the decree it is apparent that the court passing the decree has no jurisdiction or there are paten reasons for doubting the inherent jurisdiction of the court.

8. In Vasudev Bhanjbhai Modi v. Rajabhai Abdul Rehman, , the Supreme Court had occasion to deal with the

powers of the executing court. It observed that a Court executing a decree cannot go behind the decree between the parties or their representatives; it must take the decree according to its tenor, and cannot entertain any objection that the decree was incorrect in law or on facts. The Supreme Court further held that until the said decree is set aside by an appropriate proceeding in appeal or revision, a decree even if it be erroneous is still binding between the parties. No doubt, the Supreme Court in that decision has observed that if the decree is a nullity on the face of it without any evidence to be let in for that purpose, the executing court cannot execute such a decree.

9. In the light of the abovesaid two decisions, it is clear that unless the decree is a nullity, the executing court cannot go behind the decree. Admittedly, the proceedings in this case were started much earlier to the amendment to O. 23, R. 3, C.P.C. As per S. 97 (2) (a) of Act 104 of 1976, the amendment to R. 3 of O. 23, R. 3, C.P.C. before its amendment reads as follows:-

"Where it is proved to the satisfaction of the court that a suit has been adjusted wholly or in part by any lawful agreement or compromise, or where the defendant satisfies the plaintiff in respect of the whole or any part of the subject-matter of the suit, the court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far, as it relates to the parties to the suit, whether or not the subject-matter of the agreement, compromise or satisfaction is the same as the matter of the suit.

10. Thus, it is clear that as to whether such lawful agreement or compromise has been entered into is the pre-requisite for passing a decree on the compromise memo. In this case, the court has passed a decree on the strength of the compromise memo. Unless by evidence it is made out that there is no satisfaction by the court before it passed the compromise decree or that it is otherwise illegal, the compromise decree will stand. In such circumstances, the executing court has to give effect to the compromise decree and it is for the party who refused the same to set it aside by appropriate independent suit. This proposition is very clear from the two decisions referred to above.

11. For the completeness of the case, we can also look into the decisions cited by the respective counsel as to how far an advocate can bind his client in respect of the compromise memo signed only by the advocate concerned. In my view, it is superfluous to decide this issue since the proceedings in O. S. 3850 of 1974 are much earlier to the amending Act 104 of 1976. If that be so, it is only the satisfaction of the court regarding the compromise agreement that counts and there is no question of putting the compromise memo in writing signed by the parties. As I have observed already, the court which has passed the decree on the memo of compromise must be deemed to have applied its mind and satisfied with regard to the compromise entered into between the parties to the suit. Hence the question as to whether the compromise memo has to be signed by the defendant also apart from her advocate will not arise on the facts and circumstances of the present case. Nevertheless, we can look into these decisions for the completeness of the present case.

12. In Employers in relation to Monoharbahal Colliery; Calcutta v. K. N. Mishra, , the Supreme Court had occasion to deal with a case wherein the memorandum of compromise was signed by the advocate alone in the appellate stage. When the Supreme Court found that the counsel was authorised to appear on behalf of the respondents in that case, it held that the compromise is binding upon the respondents. In Jamiabai Abdul Kadar v. Shankarlal Gulabchand, the Supreme Court laid down the principle for the

authority of the legal practitioner for compromise. It is stated (Para 22):-

"While we are not prepared to consider in this case whether an advocate or pleader is liable to legal action in case of deviance or negligence, we must uphold the actual, though implied, authority of a pleader (which is a generic expression including all legal practitioners as indicated in S. 2(15). C.P.C). to act by way of compromising a case in which he is engaged even without specific consent from his client, subject undoubtedly to two overriding considerations- (i) He must act in good faith and for the benefit of his client; otherwise the power fails; (ii) it is prudent and proper to consult his client and take his consent if there is time and opportunity. In any case, if there is any instruction to the contrary or withdrawal of authority, the implicit power to compromise in the pleader will fall to the ground. We need hardly emphasise that the Bar must sternly screen to extirpate the black sheep among them, for Caesar's wife must be above suspicion, if the profession is to command the confidence of the community and the court."

From the abovesaid quotation, it is clear that the authority of a legal practitioner to compromise is also implied in that authority no doubt with the exceptions mentioned therein.

13. The abovesaid view was reiterated by a single Judge of our High Court in the Madras Co-operative Printing and Publishing Society Ltd., Madras v. O. Ramalinga, (1976) 1 Mad LJ 136 : (1976 Lab IC 546) it is stated therein that it is well settled that counsel appearing for a party is always having an implied authority to enter into a compromise on behalf of his party. The only limitation is that if there was any written prohibition or limitation we will have to act within that prohibition or limitation. It is abundantly clear from the abovesaid decisions that a Vakalat, ven though it does not state that a power is given to the advocate concerned to compromise has an implied authority to enter into a compromise on behalf of his party. But, if that authority prohibits or lays down certain limitations on the powers of the advocate concerned, the prohibition and the limitation will curtain the authority of the advocate concerned to that extent. But, such prohibition or limitation must be in writing.

14. Mr. R. S. Venkatachari has cited two decisions in support of his contention that the advocate must have written authority before he signs the compromise memo on behalf of his client or otherwise, the compromise memo is a nullity so far as that party is concerned. He cited the decision reported in Ramappayya v. Subhamma, (1948) 61 Mad LW 61 : (AIR 1949 Mad 98). In that decision, a Bench of our High Court as early as 1945, purporting to follow the observation in Sarathkumari Dasi v. Amulyadhan Kundu, (1923) 17 Mad LW 481 : (AIR 1923 PC 13) held on the facts of that case, that the attorney never had any express authority to enter into a compromise but solely to contest that suit and in those circumstances, no implied authority arises or can be deemed to have been conferred upon him to make a compromise binding upon his client. While enunciating this proposition the Bench did not agree with the Full Bench decision of the Nagpur High Court in Jiwibai v. Ramkumar, ILR (1946) Nag 824 : (AIR 1947 Nag 17) (FB) wherein the Full Bench expressed the opinion that barristers, advocates and pleaders in India have inherent powers to compromise claims without the authority or consent of their client, unless their powers have been expressly countermanded in that behalf, irrespective of whether a written authority to act or plead is or is not given. The Privy Council case reported in Saratkumari Dasi v. Amulyadhan Kundu, (1923) 17 Mad LW 481 : (AIR 1923 PC 13), deals with a case of Paradanashin lady. On the facts of that case, the Privy Council made certain observation as regards the effective consultation or consent of a pardanashin lady in effecting a compromise. I am of the view, the decision reported in Sarathkumari Dasi v. Amulyadhan Kundu, (1923) 17 Mad LW 481 : (AIR 1923 PC 13), can have no application to the facts of the present case or to the principle we are discussing now. No doubt, a Bench of our High Court purporting to follow the Privy Council decision cited above has made the abovesaid observations in Ramappayya v. Subbamma, (1948) 61 Mad LW 61 : (AIR 1949 Mad 98). But, I am not able to agree with this observation since I do not feel that the Privy Council lays down such a proposition. Nevertheless, I am inclined to follow the decision of the Supreme Court reported in Employers in relation to Monoharbahal Colliery, Calcutta v. K. N. Mishra, and Jamilabai

Abdul Kadar v. Shankarlal Gulabchand, . In the first case, the Supreme Court has held that a counsel who has been engaged to appear has authority to compromise also. In the second case, the Supreme Court has categorically held that even where there is no express authorisation to enter into a compromise, under the inherent authority impliedly given to the advocate he has been given the power to enter into compromise on behalf of his client. Both these views of the Supreme Court have been correctly followed by V. Ramaswami J. in the Madras Co-operative Printing and Publishing Society Ltd., Madras v. C. Ramalingam, 1976-1 Mad LJ 136 : (1976 Lab IC 546), wherein it has been clearly held that it is well settled that counsel appearing for a party is always having an implied authority to enter into a compromise on behalf of his party. Thus, there is no difficulty in coming to the conclusion that the counsel appearing for a party has implied authority to enter into a compromise on behalf of his party. This is no doubt subject to certain limitation which I have already referred to in paragraphs supra.

15. The above discussions will also clearly answer the contention put for ward by Mr. R. S. Venkatachari regarding the contents in the vakalat of the City Civil Court.

16. As regards the contention that the condition in the compromise decree has not been strictly complied with, the same cannot be accepted since the executing court has clearly held that the deposit of the amount is in full compliance with the terms of the decree. I am in complete agreement with the said finding.

17. for all these reasons I hold that the compromise decree is executable. In the result, the civil revision petition is allowed. There will be no order as to costs. This order passed by me will not prejudice or preclude the respondents herein to file appropriate suit if she has any right to do so.

Petition allowed.


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