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Rambrana Guddappa Rai And Ors. v. Ramanna Banta And Ors.
Structured Summary of the Opinion
Factual and Procedural Background
The suit originated in O.S. No. 200 of 1949 before the Subordinate Judge of South Kanara. The plaintiffs (members of the mortgagors' family) sought redemption of a usufructuary mortgage (Exhibit A-1 dated 15th June, 1909) executed in favour of the defendants (members of the mortgagees' family). The mortgagees had been put in possession. Tenants were impleaded as necessary parties.
The plaintiffs' right to redeem was not disputed in the trial court; the core contest concerned the quantum of compensation payable to the mortgagees in possession for improvements. The mortgagees' written statement claimed improvements of Rs. 36,290. A commissioner was appointed and reported on 4th June, 1950, valuing improvements at Rs. 22,068-14-0. Parties filed objections; the commissioner submitted remarks and a further report on 22nd July, 1950.
On 30th September, 1950, the advocates for both sides filed a joint memo stating that the parties would "abide by the decision of the Court on the issue raised in the suit, after local inspection and perusal of the documentary evidence in the case" and that they had no oral evidence to adduce. The Subordinate Judge conducted a three-day local inspection (sometime in January 1951), perused documents, heard advocates' arguments, and admitted no oral evidence.
The Subordinate Judge passed a preliminary decree for redemption, allowing the plaintiffs one month to deposit Rs. 18,999 (the Exhibit A-1 sum) plus Rs. 5,558-2-0 as compensation for improvements. This reduced the commissioner's figure of Rs. 22,068-14-0 to Rs. 5,558-2-0.
Defendants 1, 2, 4 and 5 (the appellants before the High Court) appealed, confining their claim in the appeal to Rs. 10,000 (although particulars up to Rs. 12,466-10-0 were shown). The plaintiffs (respondents before the High Court) objected to the appeal on the ground that the Subordinate Judge's order was passed on the parties' consent (the joint memo) and therefore, by Section 96 of the Civil Procedure Code, the appeal was barred.
Legal Issues Presented
- Whether the joint memo by which the parties agreed to "abide by the decision of the Court ... after local inspection and perusal of the documentary evidence" had the legal effect of taking the proceeding extra cursum curiae and constituting the Subordinate Judge a quasi-arbitrator, thereby barring an appeal under Section 96 CPC.
- Whether a document signed by the parties' advocates (but not signed by the parties themselves) can be treated as binding on the parties when the advocates had the clients' consent.
- Whether the Subordinate Judge, by conducting a three‑day local inspection and deciding the matter without oral evidence, acted within ordinary judicial jurisdiction (such that an appeal would lie) or acted in a quasi-arbitral capacity (such that no appeal would lie).
Arguments of the Parties
Appellants' Arguments
- The appellants (defendants 1, 2, 4 and 5) limited their claim on appeal to Rs. 10,000 and furnished particulars in the memorandum of appeal (details shown up to Rs. 12,466-10-0 but claim confined to Rs. 10,000).
- Before the High Court, learned counsel for the appellants argued that the parties had only asked the Judge to dispense with oral evidence and to decide after local inspection and perusal of documents; they contended this did not make the Judge an arbitrator or remove the matter from ordinary judicial jurisdiction, and therefore an appeal should lie.
Respondents' (Plaintiffs') Arguments
- The plaintiffs (respondents) raised a preliminary objection that no appeal lay because the Subordinate Judge's order was passed pursuant to the joint memo in which the parties agreed to "abide" by the Court's decision; consequently, under Section 96 of the Civil Procedure Code the appeal was barred.
- At trial, the plaintiffs had argued that the commissioner's valuation of improvements was very high (i.e., they contested the commissioner's higher figure), and no oral evidence was adduced in the local inspection process.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Pisani v. Attorney-General for Gibraltar, L.R. (1874) 5 P.C. (Appeal Cases) 516 | Cited as an English authority on the topic of proceedings where a judge acts in a quasi-arbitral capacity. | Cited by the Court as one of the English cases illustrating the principle that a judge may be treated as a quasi-arbitrator where parties agree to abide by his decision. |
| In re Durham and Building Society, L.R. (1871) 7 Ch. (Appeal Cases) 45 | Cited as an English authority relevant to agreements making the judge a quasi-arbitrator. | Referred to briefly as another illustrative English authority; the Court did not elaborate further but relied on similar reasoning. |
| Nidamarthi Mukkanti v. Thammana Ramayya (1902) I.L.R. 26 Mad. 76 | Decision construing a similar consent memo as constituting the District Munsif as an arbitrator. | The Court regarded the present joint memo as having great resemblance to the memo in this case and treated it as supportive authority for constituting the Judge a quasi-arbitrator. |
| Chengalvaroya Chetti v. Raghava Ramanuja Doss (1918) 37 M.L.J. 100 | Cited among cases interpreting agreements to abide by a Court's decision; specific rule not detailed in the opinion. | Included in the list of relevant authorities on the subject; no particular application beyond being part of the body of case law considered. |
| Sankaranarayana Pillai v. Ramaswamiah Pillai (1922) 44 M.L.J. 258 : I.L.R. 47 Mad. 39 | Described as laying down how agreements to abide are to be interpreted; used to show approach to construing such agreements. | The Court relied on the principles stated in this case about construing agreements that may bar appeals and on the need to look at the circumstances and conduct of parties. |
| Venkata Somayajulu v. Venkanna (1934) 66 M.L.J. 622 : I.L.R. 58 Mad. 31 | Headnote stated: if proceeding is extra cursum curiae the decision is in the nature of a consent order and generally unappealable; if not extra cursum curiae, appeal lies unless there is a clear waiver of the right. | The Court quoted this headnote to frame the test: whether the proceeding was extra cursum curiae (in which case appeal barred) or within ordinary procedure (in which case appeal generally lies absent clear waiver). |
| Md. Ishaq v. Balamukund, A.I.R. 1929 All. 116 | Cited as part of the body of case-law on agreements to abide by a judge's decision. | Placed among other authorities indicating varying outcomes; cited for the broader context of precedent without a detailed rule extracted in the opinion. |
| Raghubir Saran Das v. Ramdas, A.I.R. 1925 All. 348 | Cited among authorities relevant to interpretation of consent memos and their effect on appeals. | Included in the list of decisions considered in assessing whether the parties intended to take the matter outside ordinary judicial procedure. |
| Kunjammal v. Rajagopala Ayyar (1948) 2 M.L.J. 291 | Held that merely agreeing to dispense with certain procedural rules does not necessarily deprive parties of appeal; whether the agreement constituted a bar to appeal is a question of fact depending on events and conduct. | The Court expressly agreed with this articulation and applied it as the appropriate test: whether the conduct and circumstances showed the parties intended a quasi-arbitral decision. |
Court's Reasoning and Analysis
The Court proceeded step-by-step from the recorded facts and the content of the joint memo. Key elements of the Court's analysis, as stated in the opinion, were:
- Binding nature of the joint memo: Although the joint memo bore only the signatures of the advocates and not the parties themselves, the Court accepted the Subordinate Judge's finding that the parties were present during the local inspection, that the advocates who signed had their clients' previous consent and approval, and that therefore the memo must be deemed to have been made with the parties' tacit and express consent.
- Meaning of the word "abide": The Court examined dictionary and authoritative definitions (Ballentine's Law Dictionary; Ramanatha Ayyar's Law Lexicon; Halsbury's Laws of England) which define "to abide" as "to obey, to comply with, to perform, to execute, to conform to" and as "to await, to acquiesce in, to accept as valid." Halsbury's passage was relied upon to explain that when parties agree to accept the Judge's decision as final they thereby constitute the Judge a quasi-arbitrator and the decision becomes unappealable.
- Application of precedents and the factual test: The Court reviewed relevant case law and emphasised the approach in Kunjammal v. Rajagopala Ayyar that whether an agreement deprives parties of the right of appeal is a question of fact depending on the circumstances and conduct in each case. The Court also found close similarity with Nidamarthi Mukkanti v. Thammana Ramayya, where a similar memo was construed as making the judicial officer an arbitrator.
- Importance of the parties' conduct and the unusual procedure followed: The Court noted that it was unusual for a Subordinate Judge to travel far for a three-day inspection of large tracts of arecanut and other gardens and to decide value questions without oral evidence. The parties had expressly waived oral evidence and agreed to abide by the decision after inspection and perusal of documents.
- Conclusion on extra cursum curiae: Because the parties, by their joint statement and subsequent conduct (presence and co-operation during the three-day inspection, waiver of oral evidence), took the case outside the ordinary jurisdiction of the subordinate court, the Court concluded that the Subordinate Judge was made a quasi-arbitrator and the proceeding was extra cursum curiae. On that basis, the right to appeal was barred.
Holding and Implications
Holding: The High Court concluded that the parties' joint memo and their conduct constituted an agreement to abide by the Subordinate Judge's decision after local inspection and perusal of documentary evidence. Therefore the Subordinate Judge was effectively constituted a quasi-arbitrator and the proceeding was extra cursum curiae. As a result, an appeal to the High Court against the Subordinate Judge's decision was incompetent.
DISMISSED.
Implications
- Direct effect on the parties: The appeal by defendants 1, 2, 4 and 5 fails and is dismissed; the determination of the Subordinate Judge (including the preliminary decree and the fixed compensation of Rs. 5,558-2-0) stands as binding on the parties under the terms of the joint memo.
- Practice point applied by the Court: Where parties, by agreement and conduct, remove a matter from ordinary judicial procedure (for example by waiving oral evidence and asking for a conclusive decision after local inspection), the judge may be treated as a quasi-arbitrator and the decision may be unappealable; whether that occurs is a question of fact depending on the particular circumstances.
- Precedential effect: The Court applied existing case law (as cited) to the facts; the opinion frames and applies established principles but does not purport to lay down a novel or sweeping new rule beyond the application of those precedents to the present facts.
This summary is limited to and based exclusively on the material contained in the provided opinion. No additional facts or external information have been added.
1. The appellants in this appeal are defendants 1, 2, 4 and 5 in O.S. No. 200 of 1949 on the file of the Court of the Subordinate Judge of South Kanara who may be compendiously known as the mortgagees, while the plaintiffs 1 to 7 and defendants 24 to 26 represent the family of the mortgagors. The other defendants are tenants who have been impleaded as necessary parties to the litigation. The action in the Court below was for the redemption of a mortgage executed by the family of the plaintiffs in favour of the defendants' family evidenced by Exhibit A-1 dated 15th June, 10,09 for a sum of Rs. 18,999. The mortgage was usufructuary in character and the mortgagees were put in possession of the properties. It is not necessary for the purpose of this appeal to detail at any length with the terms and conditions of the mortgage especially since in the Court below the right of the plaintiffs to redeem Exhibit A-1 was not questioned. The main contest was with regard to the value of improvements payable to the mortgagees in possession which according to their written statement amounted to Rs. 36,290 and the main issues in the case related to the quantum of compensation for ascertaining which a commissioner had been appointed by the trial Court who submitted his report. The report of the commissioner dated 4th June, 1950, is a lengthy one and it deals with various matters such as the number of trees in the different plots, their size and age and the value to be paid for them. On the whole the commissioner found that the value of the improvements on redemption would amount to Rs. 22,068-14-0. Objections to this report was filed by defendants 1 to 5 as well as by the plaintiffs. Whereas the defendants claimed enhanced value, the plaintiffs submitted that the commissioner's valuation of the improvements was very high. The memos, of objection to the commissioner's report by the parties had been forwarded to the commissioner for his remarks and for his further report which he submitted on 22nd July, 1950. The various objections raised by the plaintiffs were adverted to and the commissioner submitted his remarks on them.
2. In this state of things on 30th September, 1950, the advocates appearing on both sides submitted a joint memo, to the Court which is to the following effect:
The parties submit that they will abide by the decision of the Court on the issue raised in the suit, after local inspection and perusal of the documentary evidence in the case. They have no oral evidence to be adduced.
3. From this, it is seen that neither the plaintiffs nor the defendants affixed their signature to this joint statement but that (heir advocates on their behalf have signed and filed the joint memo, into the Court. There was some dispute at the Bar as to whether the parties consented to the filing of this joint statement and the counsel appearing before us on both sides did not dispute the fact that each of the advocates who had signed the joint statement had the previous consent and approval of his client or clients for signing the joint memo, and filing it into the Court. We, therefore, take it that with the tacit and express consent of the parties the joint statement was filed by which the Court was asked to make a local inspection and peruse the documentary evidence in the case before coming to a conclusion and the parties agreed to abide by that conclusion. Accordingly, the learned Subordinate Judge proceeded to the locality and stayed there for three days, inspected the various items of properties thoroughly and made copious notes of his inspection. In the words of the learned Judge what happened was as follows:
Eventually both the parties agreed by joint memo, dated 30th September, 1950, that they would abide by the decision of the Court on these issues after local inspection and perusal of the documentary evidence in this case. This Court thereupon inspected the properties for three days in the presence of the parties and their learned advocates and also heard elaborate arguments addressed by the learned Counsel. No oral evidence was adduced by either party.
4. The joint memorandum and the notes of local inspection made by the learned : Subordinate Judge in the presence of the parties and their advocates on 26, 27 and 28th of January, 1951, form part of the record and the notes of inspection deal in extenso with the various details of improvements. The learned Subordinate Judge thereafter heard the advocates on both sides in Court at great length, and scrutinised the documentary evidence in the case in the light of his local inspection. As stated already no oral evidence was let in. The learned Subordinate Judge thereafter delivered judgment by which a preliminary decree was passed for redemption of the plaint A schedule properties, and the plaintiffs were allowed one month's time to deposit into Court the sum of Rs. 18,999 representing the amount under Exhibit A-1 and Rs. 5,558-2-0 being the amount fixed towards compensation for the improvements effected by the defendants. The result of this preliminary-decree is that the commissioner's estimate of improvements, namely Rs. 22,068-14-0 was reduced to Rs. 5,558-2-0 by the learned Subordinate Judge.
5. Aggrieved by this decision, defendants 1, 2, 4 and 5 have preferred the present appeal, and here they have confined their claim only to Rs. 10,000 for which details have been furnished in the memorandum of appeal. Though details have been shown for Rs. 12,466-10-0 the claim in the appeal is confined only to Rs. 10,000.
6. When the appeal came on for hearing a preliminary objection was taken by Mr. G.K. Govinda Bhatt for the plaintiffs, respondents, that no appeal lay for the reason that the order of the learned Subordinate Judge was passed as it were, on the consent of the parties and so under Section 96 of the Civil Procedure Code the appeal is barred. Learned Counsel for the appellants contended that the Court had not been appointed as an arbitrator but that what his clients wanted was only to dispense with oral evidence in the case, leaving the Court to decide the matter on a local inspection and after perusing the documentary evidence in the case. It is not as if the subject-matter of the suit was taken outside the purview of the ordinary jurisdiction of the Court by making the Judge an arbitrator but that only a portion of the procedure for an adjudication of the matter was dispensed! with.
7. The question now is what is the interpretation to be put upon the joint memo. A further point was raised that since the joint memo, was signed only by the advocates, the parties cannot be bound by it. We cannot countenance this argument for this reason : the learned Subordinate Judge himself states that during the three days of his local inspection in the interior of the district the parties were present and they co-operated with him in his local inspection. Since it is not disputed that the counsel signing the joint memo, had instructions to do the same, we have to take it that the joint memo, must be deemed to have been signed as it were by the parties themselves, though actually their signature do not appear on the face of it. What is the meaning to be given to the first sentence in the joint memo, that the parties submit that they will abide by the decision of the Court on the issues raised in the suit, after local inspection and perusal of the documentary evidence in the case?
8. A correct interpretation of this statement would depend to a very large extent on the meaning to be put upon the word, "abide."
9. In Ballentine's Law Dictionary (2nd edition) the following meanings are given;
'To abide' means to obey, to comply with, to perform, to execute, to conform to, to abide by the judgment or order of the Court.
10. In Ramanatha Ayyar's "The Law Lexicon of British India" the meanings given for the word "To abide" are:
to await, to acquiesce in, to conform to, to accept as valid, to take the consequence of as in the phrase to abide by an award of an arbitrator, to perform, to execute, to conform to as in the-phrase to abide by the judgment of a Court.
11. In Halsburys Laws of England (2nd edition), Vol. 1, (Lord Hailsham) at page 624 there is the following statement:
When in proceedings pending before the Court the parties agree to accept the Judge's decision as final it is stated that they thereby constitute the Judge a quasi-arbitrator. The effect of such an agreement is that the decision of the Judge is unappealable and cannot be questioned in any way but the Judge is not thereby really placed in the position of an arbitrator and his decision is not and does not in any way resemble an award.
12. From these extracts it is clear that when the parties agreed to abide by the decision of the learned Subordinate Judge, their intention was to obey or to, comply with it without questioning its correctness or validity. If that is so, it is not open to anyone of them later on when the decision went against him to turn round and say that such a decision is not binding on him. The real position is, as stated in Halsbury's Laws of England, Vol. 1, the Judge is made a quasi-arbitrator though not bound by any of the inhibitions of the Indian Arbitration Act.
13. According to Mr. T. Krishna Rao, learned Counsel for the appellants, what the learned Subordinate Judge was asked to do is what is strictly within his jurisdiction and not anything beyond it and if the act of the Judge can be brought within the confines of his jurisdiction, then it should be deemed to be that of a Court, in which case an appeal would lie from it; but if what he had done is beyond the jurisdiction of the Court, then the Judge becomes an arbitrator and no appeal will lie against his decision. The power should therefore, be specifically mentioned in the memo. As stated in some of the cases on the subject, the expression used is whether the Court acted extra cursum curiae. In our view the learned Subordinate Judge has been made a quasi-arbitrator and therefore his decision, which is not an award in the sense in which it is understood under the Indian Arbitration Act, will be binding on the parties. We need not consider at any length the English cases on the point but may refer to the decision in Pisani v. Attorney-General for Gibraltor L.R. (1874) 5 P.C. (Appeal Cases) 516 and In re Durham and Building Society L.R. (1871) 7 Ch. (Appeal Cases) 45. In Nidamarthi Mukkanti v. Thammana Ramayya (1902) I.L.R. 26 Mad. 76 a similar memo, by which the parties agreed to abide by the decision of the Court was construed by a Bench of this Court as constituting the District Munsif as an arbitrator. The Exact terms of the document are:
Both parties will abide by the decision of the Court that may be passed as it chooses after perusing the documents filed by both parties and all the records in the said suit and after measuring the sites and inspecting marks, etc., which are thereon. Therefore both parties will abide by the decision which the Court may be pleased to pass as its final decision. Sd....
14. We are of the opinion that there is great resemlance between the consent memo, filed in Nidamarthi Mukkanti v. Thammana Ramayya (1902) I.L.R. 26 Mad. 76 and the joint statement filed in the present case.
15. There has been a large body of case-law interpreting such agreements sometimes as barring an appeal against the decision on such a consent memo, and sometimes holding that an appeal lies against it. We may refer in this connection to the decisions in Chengalvaroya Chetti v. Raghava Ramanuja Doss (1918) 37 M.L.J. 100; Sankaranarayana Pillai v. Ramaswamiah Pillai (1922) 44 M.L.J. 258 : I.L.R. 47 Mad. 39; Venkata Somayajulu v. Venkanna (1934) 66 M.L.J. 622 : I.L.R. 58 Mad. 31; Md. Ishaq v. Balamukund A.I.R. 1929 All. 116; Raghubir Saran Das v. Ramdas A.I.R. 1925 All. 348. How such agreements will have to be looked into and interpreted is laid down both in Sankanarayana Pillai v. Ramaswamiah Pillai (1922) 44 M.L.J. 258 : I.L.R. 47 Mad. 39 and Venkata Somayajulu v. Venkanna (1934) 66 M.L.J. 622 : I.L.R. 58 Mad. 31. In the latter case the head note runs as follows:
If a proceeding is extra cursum curiae the decision is in the nature of a consent order and generally the right of appeal against it is barred. If on the other hand, the proceeding is not extra cursum curiae unless there is a clear waiver of the right, the right of appeal will not be lost, in that case the person who contends that no appeal will lie must clearly show that the right has either expressly or by necessary implication been given up.
16. Therefore what we have to decide is whether the parties intended to depart from the ordinary practice and constitute the Judge as a quasi-arbitrator.
17. It is not necessary to traverse at length the various cases referred to above but we shall consider the recent decision in Kunjammal v. Rajagopala Ayyar (1948) 2 M.L.J. 291, where Rajamannar, C.J. and Rajagopalan, J., after considering the earlier cases have held as follows:
A mere agreement between the parties that the Court may dispense with certain rules of procedure and evidence without giving up the right of appeal does not deprive the parties of the right of appeal but it is a question of fact in each case whether the circumstances merely amounted to deviation more or less from the ordinary procedure or whether the agreement between the parties was that the Court should give a decision more in the nature of an award than an adjudication on the evidence in the case, complete or incomplete and the intention can only be ascertained by the events which happened in a particular case.
18. We are in entire agreement with the expression of opinion contained in this case. That being the case, the question is one of fact to be decided from the circumstances and conduct of the parties. It is unusual to request a Subordinate Judge to proceed to a place far away from the Court house and make an inspection of large stretches of arecanut and other gardens for deciding the value of compensation payable and it is still more unusual that in the ordinary circumstances any Judicial Officer would spend three days of his working time inspecting the properties for purpose of ascertaining the value of improvements. Since the parties agreed to conform to or abide by the decision arrived at by the learned Subordinate Judge after inspecting the suit properties, we have no doubt, whatever, that he was constituted something in the nature of a quasi-arbitrator. Ordinarily, it is not possible to fix the value of arecanut, cocoanut and other fruit bearing trees without oral evidence which has been waived in this case. It seems to us, therefore, that by their joint statement, dated 30th September, 1950 and their subsequent conduct the parties took the case outside the ordinary jurisdiction of the sub-Court and that being the case it is a case of extra cursum curiae. In these circumstances an appeal to this Court against the decision of the Subordinate Judge is incompetent. The appeal fails and is dismissed.
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