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The Management of Natarajan Engineering Works Vs. Govindaswami Naicker and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtChennai High Court
Decided On
Reported in(1969)2MLJ211
AppellantThe Management of Natarajan Engineering Works
RespondentGovindaswami Naicker and ors.
Excerpt:
- .....proceedings till the signing of this memorandum, the appellant firm was represented by its works manager, who is the actual signatory on behalf of the firm in the memorandum of settlement. it is not denied before us by the appellant firm, that it did permit its works manager to represent the firm in the conciliation proceedings before the concerned officer. but the contention of the firm is this :--the receiver of this firm had sent a communication to the conciliation officer on an earlier date, and had advanced in that communication the contentions of the firm with regard to certain of the aspects of the controversy. the firm contends that though its 'works manager was authorised to take part in the conciliation proceedings, the authority did not extend to the acceptance of the.....
Judgment:

M. Anantanarayanan, C.J.

1. In certain conciliation proceedings under Section 12 of the Industrial Disputes Act, 1947, the respective parties were the Management of Natarajan Engineering Works (appellant), and an individual worker named Govindaswami Naicker. Ultimately, in the course of the conciliation proceedings, a settlement of ' the matters in dispute ' was reported to the Conciliation Officer, and a memorandum of the settlement was drawn up under the terms of Section 12, Sub-clause (3) of the Act. Section 12, Sub-clause (3) requires that such a memorandum must be ' signed by the parties to the dispute.'

2. It appears that, throughout the course of these conciliation proceedings till the signing of this memorandum, the appellant firm was represented by its Works Manager, who is the actual signatory on behalf of the firm in the memorandum of settlement. It is not denied before us by the appellant firm, that it did permit its Works Manager to represent the firm in the conciliation proceedings before the concerned Officer. But the contention of the firm is this :--The Receiver of this firm had sent a communication to the Conciliation Officer on an earlier date, and had advanced in that communication the contentions of the firm with regard to certain of the aspects of the controversy. The firm contends that though its 'Works Manager was authorised to take part in the conciliation proceedings, the authority did not extend to the acceptance of the terms of settlement, or to signing the memorandum of settlement, . The settlement is at variance with certain of the proposals contained in the earlier letter of the Receiver, that we have referred to. Hence, when, in 1963, which is two years later, the concerned employee attempted to enforce the terms of the settlement, this firm put forward the contention that the terms were not binding on the firm as the signature on the memorandum by the Works Manager did not bind the firm and further was opposed to the provisions of Section 12. This is the short point argued before us.

3. Learned Counsel for the firm (Sri V. Thyagarajan) has drawn our attention to several authorities. Of these we might first note the observations in Halsbury's Laws of England, Third Edition, Volume I, page 148, to the effect that, as a general proposition, a person may do by means of an agent, whatever he has power to do himself, but that there is one recognised exception to this, viz., where the transaction is required by statute to be evidenced by the signature of the principal himself. The argument is that Section 12 of the Industrial Disputes Act, 1947, like certain other sections, such as Sections 13 (2), 13 (5), 19, 20 (2) (a), specifically requires the proceedings to be signed by ' the parties to the dispute ' in contra-distinction with other sections, such as 10-A, Sub-clause (2), which requires that the agreement therein referred to must be signed by the party ' in such manner as may be prescribed.' Hence, the signature must be that of the party and if the party is a legal person, by someone authorised to sign on behalf of that party, representing that party for this purpose either under the Company Law, or upon any principle of the Common Law. It is further argued that, in consequence, Rule 25 (2) (a), which states that the settlement may be signed by the employer himself ' or by his authorised agent' is ultra vires, similarly, Rule 46 (2) to the effect that ' a party appearing by a representative shall be bound by the acts of that representative,' is ultra vires as beyond the ambit of the statute.

4. In this connection, the decision reported in In re Prince Blucher L.R. (1931) 2 Ch. 70, is cited and relied upon. As the head note shows, in that case, the Court had to consider the effect of Section 16, Sub-section (1) of the Bankruptcy Act, 1914, which requires that where a debtor intends to make a proposal for a scheme of compensation, he must lodge with the Official Receiver 'a proposal in writing signed by him'. The debtor, in that case, was seriously ill, and quite unable to form a judgment upon any such scheme. The scheme was submitted on his behalf, signed by the Solicitors, and the Court held that this was no valid proposal, that it was against the explicit terms of the statute, and that any other interpretation of the statute would amount to an amendment of it. There are, apparently, other cases that we need not particularise here, following this decision and its principle.

5. In our view, neither the passage, in Halsbury, nor the decision above cited, has truly any incidence on the facts and the issue involved in the matter before us. Here is a case in which a firm was one of the parties to a dispute, and this firm authorised and permitted its Works Manager to represent the firm, in the conciliation proceedings before the Conciliation Officer. This is explicit from the record, and it is not denied. The firm now claims that there was no authorisation to permit this Works Manager to sign any memorandum of agreement on its behalf. But, indisputably, that was the impression given to the Conciliation Officer, and to the opposite party, and, conceivably the Works Manager himself was labouring under some such belief or idea. The point is whether the language employed in Section 12, that we have earlier referred to, precludes the signing of such an, agreement by any representative of the party whatever, even if he has been explicity authorised to sign an agreement, on behalf of the firm. It is very difficult to follow the argument that, by the mere use of the words ' signed by the parties to the dispute ', the Legislature excluded all representation or agency. No such words of exclusion are to be found in the statute. The general rule must apply, therefore, that the party may himself sign, or he may sign by some authorised person or representative, who could validly sign on his behalf. Mr. Thyagarajan concedes that, in the case of an incorporated body, for instance, the person who, Under the Company Law, could sign on behalf of the legal person, may enter into such an agreement.

6. In our view, the entire matter turns upon a far simpler issue. Whether the Works Manager did or did not have the authority to proceed so far as to sign the agreement, is not the point which is really relevant. The point is that the firm permitted the Works Manager to appear on its behalf, and to take part in the conciliation proceedings. He held out that he was entitled to represent the firm for all purposes, and he signed the agreement as representing the firm. The opposite party (the workman) might well have consented to the agreement altering his position in respect of defences or contentions open to him, because he was labouring under the belief that the Works Manager represented the firm for all purposes. The firm cannot now be permitted to resile from the representation, after the opposite party had altered its position, and attempt to go behind the agreement; therefore, this is a clear case of estoppel, and it amounts also to estoppel because of conduct altering the situation, and rights of parties. Further, it amounts to acquiescence, since the firm must have been immediately aware of the agreement signed by the Works Manager, but it took no steps whatever to repudiate the agreement or the agency, till the worker sought to implement the agreement two years later. The firm also had the benefit of whatever industrial truce followed this agreement, and it is quite impossible for us to hold that there was no benefit to the firm in the form of freedom from industrial strife, because the agreement was accepted or suffered to exist for a period of two years following the signature.

7. In this view, therefore, the decision and authority cited by learned Counsel have no application to this case; nor is it necessary to decide whether, in other and different cases such a signature would suffice. Equally, it becomes unnecessary for us to decide whether Rules 25 (2) (a) and 46 (2) proceed beyond the ambit of the statute.

8. For the reasons stated by us, the writ appeal has no merits and it is dismissed. Parties will bear their own costs.


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