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Gudipoodi Subbayya and anr. Vs. Kotapalli Seshayya and ors. - Court Judgment

LegalCrystal Citation
SubjectArbitration;Civil
CourtChennai
Decided On
Reported inAIR1928Mad48a
AppellantGudipoodi Subbayya and anr.
RespondentKotapalli Seshayya and ors.
Cases Referred and Vijaya Ramayya v. Venkata Subba Rao
Excerpt:
- - subramanya aiyar air1925mad301 .in the first of these eases the privy council thought that revision was, if possible, more objectionable than appeal as, if an application to revise were admissible in cases like that before their lordships, the finality of any award would be open to question. it, therefore, seems to me that there is no ground to interfere in revision in this case and that both the grounds urged by the petitioners must fail. and having regard to the attitude which the guardian herself took up before the lower court i think that this clearly represents the truth......was binding 6n the minor defendants.5. as to the power of the court to revise in these arbitration matters reference has been made to ghulam khan v. muhammad hassan [1902] 29 cal. 167 and vaithinatha aiyar v. subramanya aiyar : air1925mad301 . in the first of these eases the privy council thought that revision was, if possible, more objectionable than appeal as, if an application to revise were admissible in cases like that before their lordships, the finality of any award would be open to question. in n. krishnamurthi v. g. ganpathi lingam [1914] m.w.n. 835 mr. justice oldfield held that the court will not usually interfere in revision with an order such as a decree passed on an award. the only way in which interference can be justified is that there was no jurisdiction to refer to.....
Judgment:

Odgers, J.

1. This is a petition to revise the judgment of the District Munsif of Ongole, dated 17th April 1923, wherein he framed a decree in terms of a certain award. The petitioners (defendants 3 and 4) are the reversioners of one Kottayya. The suit was brought against them by the plaintiff on a mortgage by Kotayya's widow and was filed after her death. The mortgagees were the pre-decessors-in-title of defendants 1 and 2, and the plaintiff is an assignee from them. The question in the suit was whether the mortgage was binding on the reversioner and the parties are alleged to have agreed to refer the matter to arbitration under Schedule 2, para 1, Civil P.C. Defendants 1 and 4, were minors when the suit commenced. We are not concerned with the first of these. The latter was represented by his mother in the suit and the first question raised before us is that as his guardian ad litem did not sign the petition to refer the suit to arbitration dated 6th October 1922, there has not, at least as far as defendant 4 is concerned, been a valid reference under Schedule 2, Civil P.C. The petition in question stated that the parties have agreed to abide by the award of one Potheheeni Raghavulu passed by him after making enquiry or without making enquiry and without having anything to do with the appeal. It is suggested that the mother's thumb-impression was taken to the original of the petition, but there is no evidence to support this. The first remark to make is that this ground has not been taken in the lower Court, but that does not preclude us from considering it here, because it must be held to go to the question of jurisdiction. It is quite clear that the jurisdiction of an arbitrator under the 1st clause is founded on the consent of parties that he shall decide the matter referred to. Now the question is did all the parties consent, or rather did the guardian of defendant 4, consent to this reference on his behalf? It has been held in several cases that the provision of the paragraph that the application shall be in writing is directory only and not mandatory: see Shoma Sundaram ' Iyer v. Abdul Latiff [1900] 27 Cal 61. It appears from the records that the guardian sent a petition to the arbitrator dated 27th November 1922, requesting him not to proceed with the arbitration, because there was a rumour that he was going to give a decision against the defendants and in favour of the plaintiff. This petition begins:

Both the parties in the above suit have appointed you as panchayatdar and for the disposal of the suit we sent the records to you.

2. It is said that that cannot be taken as antedating the consent of the guardian to the reference to arbitration and that it shows only that the widow was willing to join in the reference and so requested the arbitrator not to proceed with the award. That position seems to me on the facts, untenable, for in her evidence as P.W. 1, she says she consented to the reference as the arbitrator agreed to favour her and she quite frankly says that she preferred the petition just referred to, because the arbitration should not be proceeded with unless the result was going to be favourable to herself. A Brahmin wrote the petition, because the pleader's clerk refused to write it saying:

I (witness) have no business to do it after having consented to the reference.

3. It seems to me, therefore, that there is no doubt that the guardian of the minor, defendant 4 did consent to the appointment of the arbitrator in the first instance and to the reference of the matter in dispute to arbitrators. That all the parties need not sign the application is plain from the decision of the Privy Council in Umed Singh v. Sobhang Mal A.I.R. 1915 P.C. 79. There it appears that the parties had signed the agreement including the guardian ad litem of the minor appellant and Mr. Somayya for the petitioner urges that the reasoning of their Lordships' decision is that this agreement was presented to the Court along with the petition which was not signed by the minor appellant's guardian. Their Lordships, however, do not base their decision on the existence of any such agreement and they point out that para. 1, Schedule 2, does not require that the writing should of necessity be signed, that the guardian was in Court, and assented to the application and that, therefore, no injustice has arisen. It seems to me, therefore, that there is no substance in the 1st point taken for the petitioner, namely that the consent of defendant 4's guardian ad litem was not given to the reference to arbitration.

4. The 2nd point argued is that the guardian ad litem had no right to consent on behalf of the petitioner to a reference empowering the arbitrator to pass an award after conducting an enquiry or without conducting any enquiry. The case put forward as authority for this position is Sanyasi Rao v. Venkata Rao A.I.R 1923 Mad. 301. The arbitrator was to come to a conclusion either on his own information or on the other information known in the village or by examining witnesses of both the parties if he thought necessary. The arbitrator admitted that he enquired of witnesses behind the back of the parties and that he collected information and obtained an admission from the defendant's mother without noting them down in writing. The question according to the learned Judges was whether the minor defendant was bound by such surrender by his guardian of his legal right that the witnesses should be examined in the presence of parties and whether such a procedure makes the award otherwise invalid within the meaning of Section 15, Schedule 2, Civil P.C. It was said that it was improper to get information from one side in the absence of the other and to utilize the information not accessible to others. The learned Judges were of opinion that this procedure vitiated the award and that the defendant's guardian could not waive the minors' right to object to this irregular procedure. Further one of the learned Judges at least found that the guardian's conduct amounted to gross negligence. Now that was a matter in a first appeal and not in revision as here and I think it must be taken to be a decision on the particular facts of that case. But the fact here is that although the arbitrator was empowered to proceed with or without any enquiry he, as a matter of fact, relied not only on his own knowledge but also from what he ascertained by oral enquiries and he came to the conclusion that the widow could not maintain herself from the income of the lands of her late husband and that the debt in question was, therefore, binding on the heirs. It seems to me that in cases of this sort where the parties have referred the matter to an arbitrator related to all of them one cannot expect too precise an insistence on the forms of judicial procedure. The arbitrator was no doubt referred to because he was a relation and known to both the parties and was more or less in possession of the facts of the case. It does not seem to me to have been anywhere raised that this reference to arbitration was improper on this ground. It is noteworthy that in the affidavit in support of her objection petition dated 12th December 1922 the mother states that the arbitrator posted the case to the 27th November 1922 and, ordered the parties to be present with witnesses and she put in her petition on the 27th November 1922 because she found or she thought that the arbitrator had ' become unjust.' She nowhere says that she was not a consenting party to the reference, nor that the reference is invalid because of the clause referred to. In the order on this objection petition the Petitioner, according to the learned District Munsif, alleged that she was ignorant of the relationship between the arbitrator and defendants 1 and 2 at the time of the reference, but in the, witness-box she stated that she knew of the relationship even at that time. The Munsif came to the conclusion that none of the charges propounded in the objection petition were sustainable and he also held that the award was binding 6n the minor defendants.

5. As to the power of the Court to revise in these arbitration matters reference has been made to Ghulam Khan v. Muhammad Hassan [1902] 29 Cal. 167 and Vaithinatha Aiyar v. Subramanya Aiyar : AIR1925Mad301 . In the first of these eases the Privy Council thought that revision was, if possible, more objectionable than appeal as, if an application to revise were admissible in cases like that before their Lordships, the finality of any award would be open to question. In N. Krishnamurthi v. G. Ganpathi Lingam [1914] M.W.N. 835 Mr. Justice Oldfield held that the Court will not usually interfere in revision with an order such as a decree passed on an award. The only way in which interference can be justified is that there was no jurisdiction to refer to arbitration at all, or that the decree is in excess or is not in accordance with the award. Neither of the latter grounds have been argued before us and in Batcha Sahib v. Abdul Gunny [1914] 38 Mad. 256 Sir Arnold White, C.J., pointed out that the policy of the legislature is that judgments in accordance with the award should be final and unless it is quite clear that the learned Judge has exercised the jurisdiction wrongly there should be no interference in revision. It, therefore, seems to me that there is no ground to interfere in revision in this case and that both the grounds urged by the petitioners must fail. The civil revision petition is dismissed with costs of respondent 1.

Curgenven, J.

6. The first objection raised in this ease is that the minor was not a party to the reference to arbitration and that, therefore, the Court had no jurisdiction to make an order in accordance with the award; and P. Pavana Panda v. Narasinga Panda [1919] 42 Mad. 632 has been cited as authority for the proposition that the award would be void. The question is whether the District Munsif's warrant referring the matter to arbitration was drawn with the concurrence of all the parties. We find that the petition to refer the matter was not signed by the guardian of defendant 4, but I do not think that that necessarily disposes of the matter. The argument that has been addressed to us is that the guardian was present and consented orally to the course proposed and that no formal application was necessary. There appears to be no doubt both from the oral evidence given by the guardian herself and from the affidavit filed in support of her objection petition to the award that the plea that her consent was not given is entirely an afterthought. The plaintiffs themselves assert in their affidavit that the guardian was present in the lower Court and consented to refer the matter to arbitration; and having regard to the attitude which the guardian herself took up before the lower Court I think that this clearly represents the truth. We have, therefore, proof of consent by the guardian to the application to the Court to refer the matter to arbitration. It appears to me that the circumstances are similar to those dealt with in Umed Singh v. Seth Sobhan Mal Dhadha A.I.R. 1915 P.C. 79. In that case there was an agreement signed by all the. parties which I think their Lordships of the Privy Council used as evidence of the concurrence of all. There was further an application which although not signed by the guardian of the minor was held sufficient to conform to the provisions of para 1, Schedule 2, Civil P.C. There is ample authority for the proposition that ' the application shall be in writing ' is merely directory and not mandatory: see Luxumibai v. Hajee Widina Cossum [1899] 23 Bom. 629 Shoma Sundaram Iyer v. Abdul Latiff [1900] 27 Cal 61 and Tekat Mal Oswal v. Ananda Roy Basu [1917] 38 I.C. 226. It appears to me, therefore, that there is satisfactory proof that the minor's guardian consented to the reference, and I will only add that this question was not raised before the lower Court and no evidence was gone into, so that it can hardly be raised here in a revision petition. We are also asked to interfere under the provisions of Order 32, Rule 7 inasmuch as the provisions of that rule had not been complied with by the guardian, and Vijaya Ramayya v. Venkata Subba Rao [1916] 39 Mad. 853 was quoted for the position that such omission would validate the reference. This point was not raised in the grounds of revision, or even in the supplementary grounds, and I do not think that it can be considered now.

7. The remaining point has reference to the nature of the terms of reference and the method adopted by the arbitrator in investigating the question referred to him. The terms of reference undoubtedly gave him a very free hand, because they authorised him to give his award after going into the contentions or not going into the contentions of both parties. What he actually did is stated in his award, and the argument is addressed to us that the method he adopted was opposed to natural justice and that no guardian should have consented to such an arrangement in the interests of the minor. Reference has been made to Sanyasi Rao v.Chintalapudi Venkata Rao [1902] 29 Cal. 167 which was a first appeal so that the learned Judges could treat the question as one of fact and law, whereas the question to be considered here is only one of jurisdiction. The conduct of the arbitrator in that case was seriously impugned, but here I do not think there is sufficient material for discrediting the course which the arbitrator actually took. The nature of the enquiry which should be undertaken may depend on the nature of the questions referred to the arbitrator and here the question was whether the widow could live upon her resources without incurring any debt. The arbitrator was a relative and had personal knowledge of her affairs, and further he was in a position to make a personal inquiry, and I do not think that the methods which he in fact adopted were necessarily objectionable. It is not essential that in every case the ordinary rules of judicial procedure should be followed by. an arbitrator inquiring into a matter of this kind. It has been held in the case to which my learned brother has referred that in general the revision of decrees based upon awards is objectionable and I consider that it would not be justifiable for such a ground as this, since no question of jurisdiction is involved. I agree that the civil revision petition must be dismissed with costs of respondent 1.


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