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Shrikrishna Annaji Sonatake v. Ramnarayan Pannalal Lathi And Ors.

Bombay High Court
Oct 6, 1981
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Case Summary — Second Appeal concerning a Trust (as contained in the provided opinion)

Factual and Procedural Background

The plaintiff (originally employed as a Head Master) sued a public Trust (first defendant) and its trustees (defendants Nos. 2 to 11) in Regular Civil Suit No. 618 of 1972 in the Court of the Joint Civil Judge, Junior Division, Jalgaon, seeking recovery of Rs. 2,322/- with further interest and costs for unpaid salary for part of the academic year 1969-70. The plaintiff alleged appointment as Head Master on June 11, 1969 for the year (with total salary Rs. 327/- per month) and that the Vidyalaya was subsequently closed and defendants failed to pay the agreed salary.

The plaintiff had earlier obtained a decree in Regular Civil Suit No. 529 of 1969 for recovery of salary for the first six months of the academic year 1969-70; that decree is on record and was based on breach of contract for those six months.

At trial in Suit No. 618 of 1972 the trial Judge framed seven issues and, on consideration of evidence, held in favour of the plaintiff on the key issues: (i) issue No.5 — accepting plaintiff's contention regarding the school's closure (no evidence produced by defendants), and (ii) issue No.6 — holding that O.2 R.2 Civil P.C. did not bar the suit because the cause of action for the earlier suit and the present suit were different and because monthly salary claims gave rise to recurring causes of action. The trial Judge passed a decree (text states a decree "in the sum of Rs. 5,322 plus interest" and then records the operative portion quoting "The defendant-Trust to pay the plaintiff a sum of Rs. 2,322/- plus interest at the rate of 4% p.a from the date of suit till realisation. Defendant-Trust to pay the costs of this suit to the plaintiff and shall bear its own.").

Defendant Nos. 3, 5 and 6 alone (out of trustees numbered 2 to 11) appealed to the District Judge, Jalgaon. The District Judge reversed the trial court's decree and dismissed the plaintiff's suit on the ground that O.2 R.2 Civil P.C. barred the suit, though he agreed with the trial court on other issues. The plaintiff filed this second appeal in the High Court challenging the appellate decree.

Legal Issues Presented

  1. Whether the appeal filed by defendant Nos. 3, 5 and 6 (co-trustees) before the Appellate Court was competent and maintainable when the other co-trustees were not joined in the appeal and the operative decree was against the Trust.
  2. Whether the Appellate Court correctly held that the suit was barred by Order 2 Rule 2 of the Civil Procedure Code (i.e., whether the earlier decree in Regular Civil Suit No. 529 of 1969 barred the present claim). (This issue was before the Appellate Court but the High Court disposed of the matter on the preliminary competence point.)

Arguments of the Parties

Appellant's (Plaintiff's) Arguments — as presented through Mr. J. R. Lalit

  • The appeal filed by defendant Nos. 3, 5 and 6 before the Appellate Court was incompetent and defective because other co-trustees were not joined in that appeal either as appellants or respondents.
  • Because the decree was pronounced against the Trust alone (and did not make the individual trustees personally liable), defendant Nos. 3, 5 and 6 could not be said to be persons aggrieved or adversely affected by the decree and therefore had no locus to appeal.

Respondents' (Defendants Nos. 3, 5 & 6) Arguments — as presented through Mr. V. Z. Kankaria

  • The appeal was not defective: as co-trustees the defendants represented the Trust and their interests were joint; therefore the appeal by some trustees could challenge a decree that adversely affected the Trust.
  • Reliance on S.2(18) of the Bombay Public Trusts Act, 1950 (definition of "trustee") to show the trust property vests in trustees and that one trustee can act in proceedings affecting the trust.
  • Relying on Rameshwar Prasad v. Shambehari Lal (Supreme Court authority) as interpreting Order 41 Rule 4 C.P.C., he argued that one of several plaintiffs or defendants can represent non-appealing parties where the appellate decree proceeds on a ground common to them.
  • Relied also on Order 41 Rule 33 C.P.C. to contend that the Appellate Court has power to pass a decree against non-appealing respondents under certain circumstances.
  • Cited other authorities (including B. Sailendra Nath v. Shib Dass; Gurunath Khandappagouda v. Venkatesh Lingo; and additional cases) to support the contention that a subset of trustees or co-parties could take proceedings for the trust.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Rameshwar Prasad v. Shambehari Lal (Supra) Interpreted Order 41 Rule 4 C.P.C.: that one of the plaintiffs or defendants under R.4 may represent non-appealing defendants and thus can file an appeal when the decree proceeds on any ground common to all. The respondents relied on this authority to argue that one trustee could represent the Trust. The Court considered the reliance but found that Order 41 Rule 4 was not properly applicable to the present facts and that the memo of appeal/plaint did not sufficiently show that the trustees were described or represented as such; hence the Court did not accept this as validating the appeal here.
B. Sailendra Nath v. Shib Dass, AIR 1944 Oudh 289 Authority concerning appointment of new trustees under Section 92 Civil P.C. The Court held this authority inapplicable to the present suit because that case dealt with appointment of new trustees under Section 92 Civil P.C., whereas the present suit was not governed by Section 92.
Gurunath Khandappagouda v. Venkatesh Lingo, AIR 1937 Bom 101 Dealt with restoration of a decree and procedural consequences where some co-defendants appealed and others did not, in the context of a decree for costs. The Court observed this case had no bearing on the present facts and did not assist the respondents' position concerning competence of the appeal.
Vendakannu Nadar v. Naguneri Taluk Singikulam Annadana Chatram, AIR 1938 Mad 982 Head note (e): The office of a trustee is joint; co-trustees form, as it were, one trustee and must execute duties jointly; generally no suit concerning trust properties is maintainable by only some trustees without the remaining trustees being before the court either as plaintiffs or defendants. The Court relied on this ratio to support the proposition that all trustees (or at least formal joinder or amendment to bring them on record) should be before the court when liability of trust property is in issue. The Court accepted this precedent as supportive of finding the appeal defective because the other trustees were not before the Appellate Court and no amendment had been sought.
Atmaram Ranchhodbhai v. Gulamhusein Gulam Mohiyaddin (Gujarat High Court (FB)) Reiterates the principle that all trustees must be before the court when questions of liability of trust properties are involved. The Court cited this case as further support for the general principle applied: that the appeal by only some trustees was defective for non-joinder of co-trustees.

Court's Reasoning and Analysis

The High Court conducted a focused analysis on the preliminary procedural point concerning the competence of the appeal filed in the District Court by defendants Nos. 3, 5 and 6. The Court recited the factual posture: the suit was by the Trust (plaintiff sued "the Trust" and made trustees parties), the trial court's decree was expressed against the Trust, and multiple trustees were originally on record though some were ex parte at trial and one had died.

The Court summarized the rival contentions: (a) plaintiff's counsel argued the appeal was defective and untenable because only some trustees had appealed and the decree was not pronounced against the individual trustees, so those trustees were not "persons aggrieved"; (b) respondents' counsel argued that, under the Trust Act (S.2(18)) and relevant C.P.C. provisions (Order 41 Rule 4 and Rule 33), one trustee could represent the Trust and an appeal by some trustees could be competent.

On legal analysis the Court made the following points (as stated in the opinion):

  • Order 41 Rule 33 C.P.C. confers wide powers on the appellate court to pass a decree against non-appealing respondents, but such power is to be exercised sparingly; it could not be invoked to cure an appeal that the Court held was inherently defective where no formal amendment had been sought.
  • Order 41 Rule 4 C.P.C. (where an appellate decree proceeds on a ground common to more than one plaintiff or defendant) was not correctly invoked on these facts. The Court found it difficult to accept that because the Trust and the trustees had "common interest", Order 41 Rule 4 could be used to permit some trustees to represent others when the memo of appeal and the plaint were silent as to the trustees' designation or managing status in the appeal record.
  • Although generally one trustee interested in trust property can take proceedings, that principle could not be invoked post facto to allow reopening of a final decree where the trial court's decree did not show the individual trustees were made liable and where the other co-defendants (co-trustees) were not parties to the appeal. The Court expressed concern that allowing the present appeal to proceed could give rise to conflicting decrees.
  • The Court examined the precedents cited by the respondents and rejected several as inapposite (for instance B. Sailendra Nath because it concerns Section 92 C.P.C. and Gurunath because it was about costs and restoration in differing circumstances). The Court accepted the principle in Vendakannu Nadar (and similar authorities) that the office of the trustee is joint and that issues affecting trust property require all trustees to be before the Court or at least proper joinder/amendment to bring them on record.
  • Because the memo of appeal and plaint were silent about trustees' actual descriptions or that the present respondents were managing trustees, and because no application to amend was made, the Court concluded the appeal before the District Judge was defective and incompetent.

Given this conclusion on the preliminary point, the Court did not find it necessary to decide afresh the substantive contention concerning Order 2 Rule 2 C.P.C. (the bar pleaded by respondents and accepted by the District Judge).

Holding and Implications

Holding:

APPEAL ALLOWED; THE APPELLATE DECREE DATED FEBRUARY 9, 1976 (APPEAL NO. 124 OF 1974) IS SET ASIDE; THE TRIAL COURT'S DECREE IN CIVIL SUIT NO. 618 OF 1972 (DATED APRIL 11, 1974) IS RESTORED AND CONFIRMED.

Consequences and Implications:

  • Direct effect on the parties: The trial court's decree in favour of the plaintiff (ordering the defendant-Trust to pay the plaintiff the stated sum with interest and costs as recorded in the operative portion) is restored and the appellate court's dismissal of the suit is vacated.
  • Costs: The High Court awarded the costs of this second appeal to the appellant (the plaintiff), noting the appellant succeeded on a technical (procedural) point.
  • Broader legal implication: The Court's decision turned on established procedural principles concerning joinder and representation of trustees and the competence of appeals by some but not all trustees. The opinion applied existing authorities and procedural rules; it did not purport to lay down a novel legal principle or a new precedent beyond reaffirming the need for proper joinder or formal amendment when trustees' joint interest and representation are in issue.

Note: This summary strictly reflects only the information and arguments as they appear in the provided opinion. No facts or conclusions beyond that text have been added.

Show all summary ...

1. This second appeal is filed by original plaintiff against the appellate decree passed against respondent No. 4 Trust, respondent Nos. 1 to 3 are the trustees of the Trust-respondent No. 4, though they are not described as such.

2. The plaintiff had filed a suit against the Trust initially in the Court of the Joint Civil Judge, Junior Division, Jalgaon, being Regular Civil Suit No. 618 of 1972 impleading the Trust as the first defendant and defendants Nos. 2 to 11 as original trustees. The suit was filed to recover an amount of Rs. 2,322/- with further interest and costs. The case of the plaintiff was that the first defendant is Public Trust and he was the employee of this Trust working as a teacher in one of the High Schools conducted by the Trust. The plaintiff was appointed as the Head Master for academic year 1969-70 on monthly pay of Rs. 200/- as the basis pay and permitted dearness allowance. The total salary of the plaintiff was Rs. 327/- per month. It was the case of the plaintiff that he was appointed on June 11, 1969 for a period of one year i.e., from June 11, 1966 to June 10, 1970.

3. It appears that the schooled was closed within that time after appointment and the defendants did not pay the plaintiff the agreed amount of salary, and therefore, the plaintiff was required to file a suit for recovery of his pay. The plaintiff had, therefore, filed an earlier suit, being Regular Civil Suit No. 529 of 1969 to recover his salary and it appears that suit related to the first six months of academic year 1969 70. That suit came to be decreed and the decree in that suit is on record which shows that the plaintiffs claim to the extent of six months period was decreed on the basis that the defendant-Trust committed breach of contract.

4. In this suit, which is filed by the plaintiff the plaintiff says that he was ready and willing to work as Head Master for the whole year but Vidyalaya was closed and the defendant-Trust is liable to pay for the remaining six months of the academic year 1969-70.

5. Defendant-Trust raised a plea that the suit is barred by the provisions of O. 2 R. 2 of the Civil P. C., in view of the judgment and decree passed in the earlier suit being Reg. Civil Suit No. 529 of 1969. It also dented that the Trust had committed any breach of contract and finally contended that the plaintiff is not entitled to any relief because be had not cause of action to his the present suit.

6. The learned trial Judge framed as many as seven issues. On consideration of the evidence on record, he held on issue No. 5 which related to the closure of the school, that as on this issue no evidence was given by the defendants, therefore, the contention of the plaintiff was accepted by the trial Judge that the school was not closed and therefore holding the contract continues he held that the plaintiff is entitled to the relief claimed by him. On issue NO. 6. Which related to the bar under O. 2 R. 2 of the Civil P. C. The learned trial Judge held that the bar is not attracted, because the cause of action for the present suit and the cause of action for the earlier suit are different, holding that the former suit was for recovery of damages of the earlier six months and the present suit is confined to the period from Nov. 12, 1969 to June 11. 1970 and the bar of O. 2 R. S of the Civil P. C. Does not arise. The learned trial Judge was of the view that since the plaintiff's claim relates to the monthly salary in which event monthly salary becomes due per month and as this cause of action is recurring cause of action, he held that the bar of O. 2 R. 2 of the Code cannot be attracted to the present suit. The other issues are not necessary to be taken into consideration. On these principal issues, the trial Judge having held in favour of the plaintiff passed a decree in the sum of Rs. 5,322 plus interest. It is material in note that the decree reads as follows:-

"The defendant-Trust to pay the plaintiff a sum of Rs. 2,322/- plus interest at the rate of 4% p.a from the date of suit till realisation. Defendant-Trust to pay the costs of this suit to the plaintiff and shall bear its own."

7. Against this decree, only defendant Nos. 3, 5 and 6 filed an appeal before the learned District Judge, Jalgaon. This appeal was heard by the learned District Judge and he had reversed the decree passed by the trial Court and dismissed the suit of the plaintiff on the ground of bar of O. 2 R. 2 of the Civil P. C. Although be held on other issues in favour of the plaintiff concurring with the trial Court. In the resuit the learned District Judge allowed the appeal and set aside the decree of the trial Court, and dismissed the suit of the plaintiff by his judgment and decree, dated Feb., 9, 1976. The plaintiff being dissatisfied with this appellate decree has filed this second appeal in the High Court.

8. It may be noted here that the first defendant is a Trust and there were as many as defendants Nos. 2 to 11 as trustees originally on record. Mr. V. Z. Kankaria, the learned Advocate for the respondents had told that defendants Nos. 3, 5 and 6 were represented by lawyers and original defendant No. 11 died and all other respondents were ex parte. Original defendant No. 2 Pandharinath Thapade is not the appellant before me.

9. Mr. J. R. Lalit for the appellant has raised preliminary point that the appeal filed by defendant Nos. 3, 5 and 6 before the Appellate Court is incompetent and defective, because the other defendants who were co trustees are not jointed in the said appeal either as appellants or respondents. Secondly, he says that as the decree is only passed against the Trust, the appeal filed by defendants Nos. 3,5 and 6 is untenable, because they cannot be said to be the persons aggrieved or adversely affected by the decree. I have already quoted the extract of the operative portion of the decree and from that it appears that decree and not show that original defendants Nos. 2 to 11 are made liable under the said decree.

10. Mr. Kankaria, the learned Advocate for the respondents has urged before the that the framing of the appeal before the Appellate Court is not detective, because defendants Nos. 3 5 and 6 are co-trustees along with other trustees and the Trust is duly represented by them and their interest being joint, they are entitled to challenge the decree, which adversely would affect the Trust. He invited my attention to the provisions of S. 2 (18) of the Bombay Public Trusts Act, 1950 (hereinafter referred to as the ""Trust Act"') which reads thus:-

"2 (18) "trustee" means a person in whom either alone or in association with other persons, the trust property is vested and includes a manages."

Mr. Kankaria also invited my attention to the definition of 'public Trust' and contended that any one of the trustees being interested can file the appeal, and therefore the framing of the appeal and therefore the framing of the appeal is out defective. He tried to substantiate his case by citing certain circumstances. Especially he invited my attention to the authority reported in Rameshwar Prasad v. Shambehar Lal. . Relying on the provisions of Civil P. C. Contained in O. 41 R 4 as interpreted by the Supreme Court in Rameshwar Prasad v. Shambehari Lal (supra) he this appellate decree has filed this second appeal in the High court.

8. It may be noted here that the first defendant is a Trust and there were as many as defendants Nos.2 to 11 as trustees originally on record. Mr.V.Z. kankaria, the learned Advocated for the respondents had told that defendants Nos. 3, 5 and 6 were represented by lawyers and original defendants No.11 died and all other respondents were ex parte. Original defendant No.2 pandharinath Thapade is not the appellant before me.

9. Mr.J.R. Lalit for the appellant has raised preliminary point that t he appeal filed by defendant Nos. 3,5 and 6 before the Appellate court is incompetent and defective, because the other defendants who were co-trustees are not joined in the said appeal either as appellants or respondents. Secondly, he says that as the decree is only passed against the Trust, the appeal filed by defendants Nos. 3,5 and 6 is untenable. Because they cannot be said to be the persons aggrieved or adversely affected by the decree. I have already quoted the extract of the operative portion of the decree and from that it appears that that decree does not show that original defendants Nos.2 to 11 are made liable under the said decree.

10. Mr.Kankaria, the learned Advocate for the respondents has urged before me that the framing of the appeal before the Appellate court is not defective, because defendants Nos.3,5 and 6 are co-trustees along with other trustees and the Trust is duly represented by them and their interest being joint, they are entitled to challenge the decree, which adversely would affect the Trust. He invited my attention to the provisions of S.2 (18) of the Bombay public Trusts Act, 1950 (hereinafter referred to as the

"Trust Act"
) ,which reads thus:-

"2 (18) "trustee" means a person in whom either alone or in association with other persons, the trust property is vested and includes a manager."

Mr.Kankaria also invited my attention to the definition of 'public Trust' and contended that any one of the trustees being interested can file the appeal, and therefore the framing of the appeal is not defective. He tried to substantiate his case by citing certain circumstances. Especially he invited my attention to the authority reported in Rameshwar prasad v.shambehari Lal, . Relying on the provisions of Civil P.C. contained in O.41, R 4 as interpreted by the supreme court in Rameshwar prasad v. Shambehari Lal (supra), he contended that one of the plaintiffs or defendants under R.4 represents the non-appealing defendants and thus can file the appeal when the decree proceeds on any ground common to all. He also invited my attention to other two cases in support of his contention that one co-trustee can file appeal. He also relied on the case reported in B.sailendra Nath v.shib Dass, AIR 1944 oudh 289, which case according to me is not applicable to the facts of the present case, because the said case deals with the appointment of new trustees under section 92 of the Civil P.C. There is no quarrel with the proposition that the new trustees can be appointed in place of old trustees in a case which governed by section 92 of the Civil P.C. for removal of the trustees. The present suit is not a suit as contemplated by sec. 92 of the civil P.C. Mr.Kankaria again referred to an authority reported in Gurunath Khandappagouda v. Venkatesh Lingo, AIR 1937 Bom 101, which case has no bearing on the present facts of the case, because that case related to a decree for costs which was made against A,B, and C in the trial court and after execution of the decree against A, on appeal by B and C to which A was not party , the decree was reversed and A applied for restoration of that decree. It was held in that case that A was entitled to restoration though he was no party to the appeal. This case again is not any assistance to Mr.Kankaria in any way.

11.There is another aspect, which is important in this case, that the first defendant-Trust was the public trust and defendant No.2 was managing the affairs of the trust as stated in the judgment of the trial court. It would have been expected that at least defendant No.s should be have been on record to file the appeal. Mr.Kankaria is unable to show me from the memo of appeal of the Appellant court or the plaint that the trustees were described as such of that the present respondents Nos. 1 to 3 were mentioned as managing trustees. In the absence of the other co-defendants against whom the decree was not passed by the trial court, in my opinion, the decree of the trial court has become final and if it is allowed to be reopened at the instance of defendants Nos.3,5 and 6 as the remaining co-defendants are not parties to this appeal as stated above, I think that it will give rise to conflicting decrees. If the decree is joint and one, then it is difficult to see how in this particular case at least defendants Nos.3,5 and 6 could represent the other trustees of the Trust when defendant No.2 was actually described as managing trustee as stated above In the judgment.

12. The learned Advocated Mr.Kankaria further contended that In view of the provisions of O.41 R.4 of the civil P.C. as the trust properly vests in the trustees as stated in the definition of "trustee" contained in S.2 (18) of the public Trusts Act and in view of the cases, which are cited by him to support his contention that the appeal before the Appellate court was competent one, he also relied on the provisions of O.41 , R.33 to support his contention that the decree can be passed against non-appealing defendants and the Appellate court is entitled to exercise power under O.41, R.33 of the Civil P.C.

13. I need not discuss the provisions of o.41 , R.33 of the civil P.C. It is sufficient to say that reliance on the provisions of Order 41, Rule 33, is quite misconceived. Order 41, Rule 33 deals with the powers of the appellate court to pass a decree against non-appealing respondent or under certain special circumstances. The power is wide and therefore it is also to be exercised sparingly. The power cannot be invoked for the simple reason, because the appeal filed by defendants. Nos.3,5 and 6 before the learned District judge is inherently defective and no formal application for amendment of the defect has ever been given even to-day. I have not prevented Mr.Kankaria to address his arguments although he has not formerly made any application for amendment, but that does not solve the controversy in regard to the preliminary point. In my opinion, reliance on O.41 R.4 of civil P.C. is also not correct. Order 41, Rule 4 deals with the case where there are more plaintiffs or more defendants than one in a suit and the appellate decree proceeds on any ground common to any one of them. In view of the contention of mr.Kankaria that the interest of the Trust and the trustees is one and same, it is difficult to see how the provisions of O.41, R.4 can be availed of.

14. It is true that in case of trust, one of the trustees interested in the property can certainty take proceedings, but in this case I am concerned with the decree which is already passed by the trial court and the trial court having not held the respondents liable under the decree, I do not see now this principle will be applicable to the facts of the present case. The memo of appeal in the District court as well as the plaint is silent about the actual description and designation of the other respondents who are trustees although the plaintiff has himself stated in his plaint that he is suing the Trust and made the other trustees as party defendants to the suit. But that position is not being availed of by the defendants, because the suit was tried and the decree was passed by the trial court. As the decree as interpreted is only against the Trust, it is not possible to accept the contention of mr.Kankaria that the other trustees are averse affected or can be said to be the aggrieved persons.

15. Mr. Lalit, the learned Advocate for the appellant has invited my attention to a case reported in vendakannu Nadar v.Naguneri Taluk Singikulam Annadana chatram, AIR 1938 Mad 982 and reliance was placed on Head Note (e), which reads as follows :

"The general principle of law is that the office of a trustee, irrespective of the number of trustees,is a joint one and co-trustees from , as it were one trustee and must therefore execute the duties of their office jointly. Hence no suit in regard to trust properties would be maintainable by one or some of the trustees only, if the remaining trustees are not before the court either as plaintiffs or even as defendants."

Following ratio of this decision, I see no difficulty in accepting the contention raised by Mr.Lalit. It is further found in the said authority that the other co-tustees were not made parties and even formal amendment application for bringing them on record was not made. In this case also, Mr. Kankaria has also not made any attempt to make any application to bring the other trustees on record. Therefore, in my opinion, the appeal filed before the District court is defective. Mr.Lalit also derived support fro the Gujarat High court (FB) , case reported in Atmaram Ranchhodbhai v.Gulamhusein Gulam mohiyaddin, which reiterates the same principle that all the trustees must be before the court when the question of liability of trust properties is involved. In inview of this legal position, In hold that the appeal filed by defendants nos.3,5 and 6 before the learned District Judge, Jalgaon being civil Appeal No.124 of 1974 was not competent appeal and, therefore, the findings recorded by the learned District judge in the appeal are liable to be vacated. I do not think it necessary to deal with the other point regarding bar of O.2, R.2 of the Civil P.C. as the appeal stands disposed of on the preliminary point raised by mr.Lalit.

16. In the result, the appeal is allowed. The appellate decree, dated Feb.9, 1976 in Appeal No.124 of 1974 is set aside and the decree of the trial court in civil suit No.618 of 1972, D/- April 11, 1974 is restored and confirmed.

Mr. Lalit for the appellant pressed for costs throughout. I do not agree with the learned Advocate as the appellant has succeeded on a technical point and therefore the appellant will be entitled to the costs of this appeal.

17. Appeal allowed.