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  • The Hon'ble Dr. Tej Bahadur Sapru, (with him the Hon'ble Pandit Moti Lal Nehru and Munshi Baleshwari Prasad), for the appellant:—
  • Mr. B.E.O'Conor (with him the Hon'ble Munshi Narain Prasad Ashthana and Baldeo Ram Dave), for the respondents:—
  • The compromise and the decree passed thereon in the former suit are not binding on the present plaintiffs inasmuch as the leave of the court had not been obtained by the next friend to enter into the compromise on the minors' behalf. It has been laid down repeatedly by the highest tribunal that the provisions of law requiring the obtaining of such leave are of great importance for the purpose of protecting the interests of minors, and their non-observance renders the compromise invalid against the minors; Manohar Lal v. Jadunath Singh Ganesha Row v. Tuljaram Row(2), Subramanian Chettiar v. Raja Rajeswara Dorai(3) Jamna Bai Saheb Mohitai Avergal v. Vasanta Rao Ananad Rao Dhybar(4). These cases were decided under section 462 of the Code of Civil Procedure of 1882. The corresponding provision in the present Code, namely, order XXXII, rule 7, which applies to the present case is still more emphatic and makes it obligatory that the leave of the court should be expressly recorded in the proceedings, and sub-rule (2) declares that a compromise entered into without the leave of the court so recorded shall be voidable. Quite apart from the question whether the minors were or were not prejudiced by the compromise, it is voidable at their instance merely on the ground that the leave of the court had not been obtained and expressly recorded in the proceedings. I also rely on the case of Hanuman Rai v. Jagdis Rai, which brings out the more emphatic character of order XXXII, rule 7, as compared with the former section 462. The view taken by the Allahabad High Court in the case of Aman Singh v. Narain Singh, cannot now be accepted, having regard to the Privy Council decisions and to the provisions of order XXXII, rule 7, of the present Code. Secondly, on the face of it the compromise has prejudiced the rights of the plaintiffs. The finding of the lower court to the contrary is incorrect.
  • Although leave was neither formally granted nor recorded, yet the proceedings and circumstances of the former case leave no doubt that the attention of the court was directly called to the fact that there were minors in the case, and that the court accepted and adopted the compromise with full knowledge of that fact. That was laid down by the Privy Council in the case in Manohar Lal v. Jadunath Singh to be what was required under section 462.
  • The compromise is, in fact, beneficial to the minors.
  • The Hon'ble Dr. Tej Bahadur Sapru, was not heard in reply.
Judges
  • Hon'ble Mr. Syed Mohd. Rafiq
  • Hon'ble Mr. Theodore Caro Pigott
Acts
  • section 462 of the old Code of Civil Procedure, Act XIV of 1882.
  • rule 23, of the Code of Civil Procedure.
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Attorney(S)
  • The Hon'ble Dr. Tej Bahadur Sapru, (with him the Hon'ble Pandit Moti Lal Nehru and Munshi Baleshwari Prasad), for the appellant:—
  • Mr. B.E.O'Conor (with him the Hon'ble Munshi Narain Prasad Ashthana and Baldeo Ram Dave), for the respondents:—
  • The compromise and the decree passed thereon in the former suit are not binding on the present plaintiffs inasmuch as the leave of the court had not been obtained by the next friend to enter into the compromise on the minors' behalf. It has been laid down repeatedly by the highest tribunal that the provisions of law requiring the obtaining of such leave are of great importance for the purpose of protecting the interests of minors, and their non-observance renders the compromise invalid against the minors; Manohar Lal v. Jadunath Singh Ganesha Row v. Tuljaram Row(2), Subramanian Chettiar v. Raja Rajeswara Dorai(3) Jamna Bai Saheb Mohitai Avergal v. Vasanta Rao Ananad Rao Dhybar(4). These cases were decided under section 462 of the Code of Civil Procedure of 1882. The corresponding provision in the present Code, namely, order XXXII, rule 7, which applies to the present case is still more emphatic and makes it obligatory that the leave of the court should be expressly recorded in the proceedings, and sub-rule (2) declares that a compromise entered into without the leave of the court so recorded shall be voidable. Quite apart from the question whether the minors were or were not prejudiced by the compromise, it is voidable at their instance merely on the ground that the leave of the court had not been obtained and expressly recorded in the proceedings. I also rely on the case of Hanuman Rai v. Jagdis Rai, which brings out the more emphatic character of order XXXII, rule 7, as compared with the former section 462. The view taken by the Allahabad High Court in the case of Aman Singh v. Narain Singh, cannot now be accepted, having regard to the Privy Council decisions and to the provisions of order XXXII, rule 7, of the present Code. Secondly, on the face of it the compromise has prejudiced the rights of the plaintiffs. The finding of the lower court to the contrary is incorrect.
  • Although leave was neither formally granted nor recorded, yet the proceedings and circumstances of the former case leave no doubt that the attention of the court was directly called to the fact that there were minors in the case, and that the court accepted and adopted the compromise with full knowledge of that fact. That was laid down by the Privy Council in the case in Manohar Lal v. Jadunath Singh to be what was required under section 462.
  • The compromise is, in fact, beneficial to the minors.
  • The Hon'ble Dr. Tej Bahadur Sapru, was not heard in reply.
Judges
  • Hon'ble Mr. Syed Mohd. Rafiq
  • Hon'ble Mr. Theodore Caro Pigott
Acts
  • section 462 of the old Code of Civil Procedure, Act XIV of 1882.
  • rule 23, of the Code of Civil Procedure.
See more information ...
Smart Summary

Judgment Summary — Mohammad Rafiq and Piggott, JJ.

Factual and Procedural Background

The dispute concerns a zamindari property alleged to have belonged to Chhail Bihari Lal (a grandson of Makhun Lal). Chhail Bihari Lal died about 25 years prior to the opinion; his widow, Musammat Harbansa Kunwar, died on 26 August 1910. On her death a dispute arose between two groups of reversioners: the grandsons of Bal Makund (eight persons) and the grandsons of Kunj Bihari Lal (three persons), eleven persons in all, all standing in the same degree of relationship to Chhail Bihari Lal.

In 1912 the grandsons of Bal Makund sued the grandsons of Kunj Bihari Lal to recover an interest in the property. Three of the plaintiffs (Sukhdeo Bihari, Basant Bihari Lal and Nit Bihari Lal) were minors; Shiam Narain was appointed next friend for the minors. After hearings a compromise was proposed (documented in December 1912) and ultimately a decree was entered on 31 March 1913 in terms of that compromise. The compromise resulted in the eight grandsons of Bal Makund receiving half of the zamindari and the three grandsons of Kunj Bihari Lal retaining the other half.

Within eighteen months three minors (Basant Bihari Lal, Nit Bihari Lal — sons of Murli Manohar — and Badri Narain, the minor brother of Shiam Narain) sued to recover the difference between what they would have been entitled to under Hindu law and the share allotted under the compromise decree. They alleged that at the time of the 1912 suit they were minors, that the compromise-decree of 31 March 1913 was entered into without the court's leave (as required by law) and that the compromise was injurious to their interests; they also alleged fraud and collusion.

The trial court decided only the issue whether the compromise-decree was valid and binding and held that it was not fraudulent or collusive, not injurious to the minors' rights, and that it had been entered into with the court's leave. The other issues were left undecided. On appeal, the present bench considered whether (a) leave of the court had in fact been obtained (as required by Order XXXII, rule 7), and (b) whether the compromise was injurious to the minors' rights and, if not binding, what relief (if any) they should receive.

Legal Issues Presented

  1. Whether the compromise entered into in the 1912 suit and embodied in the decree dated 31 March 1913 was entered into on behalf of minors without the leave of the court required under Order XXXII, rule 7 of the Code of Civil Procedure, and whether that omission renders the compromise voidable at the instance of the minors.
  2. Whether the compromise (if not binding on the minors for want of recorded leave) injuriously affected the rights of the minors and, if so, what relief the minors are entitled to — whether unconditional recovery of the property or recovery subject to terms.
  3. Whether the lower court's factual finding that the compromise was not injurious to the minors' interests was sufficiently reasoned and conclusive.

Arguments of the Parties

Appellants' Arguments

  • The appellants (minor plaintiffs) contended that at the time of the compromise-decree they were minors and that the compromise was entered into without obtaining the leave of the court as required by law (Order XXXII, rule 7), and therefore the compromise was voidable at their instance.
  • They further alleged that the compromise injuriously affected their interests (they sought recovery of the difference between the share under Hindu law and the share allotted under the decree) and also alleged fraud and collusion (though they did not challenge the trial court's finding on fraud and collusion on appeal).

Respondents' Arguments

  • The respondents adopted the reasoning of the lower appellate court, which held that although no formal recorded leave appears, the trial court had the matter before it and was aware that minors were parties, so the omission to record a formal order was immaterial.
  • In support, they relied on the Privy Council's remarks in Manohar Lal v. Jadunath Singh to the effect that there ought to be evidence that the court's attention was directly called to the fact that a minor was a party to the compromise and that leave should be shown by an order or in some way not open to doubt; they argued the proceedings (notably those of 4 February 1913) left no doubt that the trial court's attention had been directly called to the presence of minors.

Table of Precedents Cited

All precedents are listed as they appear in the opinion. Where the opinion does not state the precise rule or principle attributed to a precedent, the table notes that the opinion did not specify it.

Precedent Rule or Principle Cited For Application by the Court
Manohar Lal v. Jadunath Singh Privilege Council dictum that evidence should show the court's attention was directly called to the fact that a minor was a party and that leave should be shown by an order or otherwise not open to doubt (as noted in the opinion). The court considered the Privy Council's remarks but held that the present statutory provision (Order XXXII, rule 7) is stricter than the earlier dictum given under section 462 of the old Code of Civil Procedure (Act XIV of 1882). The bench rejected the respondents' reliance on Manohar Lal to excuse the absence of a recorded leave.
Subramanian Chettiar v. Raja Rajeswara Dorai Not specified in the provided opinion text. Cited by counsel for the plaintiffs; the court's opinion does not elaborate on how this case was applied.
Jamna Bai Saheb Mohitai Avergal v. Vasanta Rao Ananad Rao Dhybar Not specified in the provided opinion text. Cited by counsel for the plaintiffs; the court's opinion does not elaborate on how this case was applied.
Hanuman Rai v. Jagdis Rai Not specified in the provided opinion text. Cited by counsel for the plaintiffs; the court's opinion does not elaborate on how this case was applied.
Ganesha Row v. Tuljaram Row Not specified in the provided opinion text. Cited by counsel for the plaintiffs; the court's opinion does not elaborate on how this case was applied.

Court's Reasoning and Analysis

The court examined whether the compromise-decree of 31 March 1913 was binding on the minors, focusing primarily on the statutory requirement in Order XXXII, rule 7 of the Code of Civil Procedure. The opinion quotes the rule in full:

“No next friend or guardian for the suit shall, without the leave of the court, expressly recorded in the proceedings, enter into any agreement or compromise on behalf of a minor with reference to the suit in which he acts as a next friend or guardian. Any such agreement or compromise entered into without the leave of the court so recorded shall be voidable against all parties other than the minor.”

Key points in the court's reasoning:

  • The bench found no recorded order in the 1912 proceedings expressly granting leave to Shiam Narain (the next friend) to enter into the compromise on behalf of the minors. This omission is critical because Order XXXII, rule 7 requires leave to be "expressly recorded in the proceedings."
  • The court rejected the lower appellate court's suggestion that the trial court's general awareness of minors in the case made formal recording immaterial. The bench held that the present law is stricter than the earlier Privy Council dictum in Manohar Lal (which arose under the old Code of Civil Procedure, section 462), because the present provision contains the express words "expressly recorded in the proceedings."
  • Applying the second sub-clause of Order XXXII, rule 7, the court held that the compromise entered into on behalf of the minors without recorded leave is voidable at the instance of the minors; accordingly the decree is not binding on the present plaintiffs.
  • The court did not stop at this legal conclusion. It addressed the respondents' contention that, even if the compromise is not binding, the minors should not necessarily be granted the full relief sought unless it is shown that the compromise injuriously affected their interests.
  • The bench found the lower appellate court's factual conclusion that the compromise was not injurious to the minors' interests to be insufficient and inconclusive. The court specified additional matters that the lower court should examine on remand, including:
    • the value of the minors' share under Hindu law (as compared to the share allotted under the compromise),
    • transactions preceding the compromise (notably the sale of Muhabbatpur and Mehrabad to the defendants and the sale of a portion of Shabjalpur by the defendants to the plaintiffs), and
    • the allegation that the defendants paid nearly double the price for certain villages in consideration of the subsequent compromise (i.e., whether there was a quid pro quo that lessened the minors' share).
  • The court also noted the procedural and substantive question that must be resolved on remand: if the minors are not bound by the compromise-decree, whether they are entitled to unconditional recovery of the property or should be put upon terms, and if terms are to be imposed, what they should be.
  • For these reasons the bench allowed the appeal, set aside the decree of the court below, and remanded the cause for trial under Order XLI, rule 23 of the Code of Civil Procedure with directions to try the specified issues.

Holding and Implications

Core Ruling: APPEAL ALLOWED; THE DECREE OF THE COURT BELOW IS SET ASIDE; THE CAUSE IS REMANDED FOR TRIAL.

Direct consequences to the parties (as stated in the opinion):

  • The compromise-decree dated 31 March 1913 is not binding on the present plaintiffs (the minors) because it was entered into on their behalf without the leave of the court "expressly recorded in the proceedings" as required by Order XXXII, rule 7.
  • The case is remanded to the lower court to try, in addition to the issues left untried, the specific issues directed by the bench:
    1. Whether the compromise injuriously affected the rights of the plaintiffs;
    2. Assuming the plaintiffs are not bound by the 31 March 1913 decree, whether they are entitled to recover the property (or any part of it) unconditionally or should be put upon terms, and if so upon what terms.
  • The remand is to be conducted under Order XLI, rule 23 of the Code of Civil Procedure.
  • The costs of the appeal were ordered to abide the event.

The opinion does not purport to lay down any broader precedent beyond its application of Order XXXII, rule 7 to the facts of this case. The court expressly relied on the statutory requirement that leave be "expressly recorded in the proceedings" and remitted factual questions of injuriousness and appropriate relief to the lower court.

Disposition: Appeal allowed and cause remanded.

Show full summary ...

    Badri Prasad v. Gopal Bihari Lal

    Mohammad Rafiq and Piggott, JJ.:— The following pedigree will explain the right under which the parties to this appeal are litigating.

    The property in suit is alleged to have belonged to Chhail Bihari Lal, a grandson of Makhun Lal. Chhail Bihari Lal died about 25 years ago leaving him surviving a widow of the name of Musammat Harbansa Kunwar. She died on the 26th of August, 1910. On her death a dispute arose between the grandsons of Bal Makund and Kunj Bihari Lal, the reversioners to Chhail Bihari Lal. There were eleven persons living at the time, namely, Badri Narain, Basant Bihari, Nit Bihari Lal, Kishan Dayal, Maha Narain, Shiam Narain, Binod Bihari Lal, Sukhdeo Bihari, Gopal Bihari Lal, Madho Narain and Kunwar Bihari Lal. The first eight were grandsons of Bal Makund and the last three were the grandsons of Kunj Bihari Lal, and all the eleven stood in the same degree of relationship to Chhail Bihari Lal. In 1912 the grandsons of Bal Makund instituted a suit against the grandsons of Kunj Bihari Lal, to recover of the property alleged to have belonged to Chhail Bihari Lal. Three of the then plaintiffs namely, Sukhdeo Bihari, Basans Bihari Lal and Nit Bihari Lal, the sons of Murli Manohar, were minors at the time. Shiam Narain, their first cousin, was appointed their next friend for the suit. After several hearings a petition of compromise was filed on the 11th of September, 1912. It was filed by Chaudhri Dammai Lal and Babu Binod Bihari Lal, pleaders, for the plaintiffs and Madho Narain, Binod Bihari Lal was one of the plaintiffs in the case and Madho Narain acted for self and as guardian of his younger brother, Kunwar Bihari Lal. The court directed the pleader for the plaintiffs to produce his clients for verification of the compromise on a subsequent date, namely, the 8th of October, 1912. The case was taken up, but the verification on behalf of the plaintiffs was not made, and the 13th of November, 1912, was fixed for filing of the written statement. The case adjourned from time to time for various reasons, and on the 11th of December, 1912, a compromise was filed which was dated the 6th of December, 1912. The court directed that the parties should appear before it the next day to verify the compromise. On the 12th of December, 1912, Binod Bihari Lal, one of the plaintiffs, and Madho Narain, one of the defendants, were alone present. Babu Binod Bihari Lal objected to the compromise, and the case was put off to the 4th of February, 1913, for the reception of any objection that other parties might have to the compromise. On the 4th of February, 1913, the case was taken up and an objection was filed on behalf of Shiam Narain, Kishan Dayal and Maha Narain against the compromise on the allegation that it was injurious to the rights of the plaintiffs and especially the rights of the minor plaintiffs and that the leave of the court had not been asked for or granted to the minor plaintiffs to enter into a compromise. An application purporting to have been written on the 6th of December, 1912, by Shiam Narain, the next friend of the four minor plaintiffs, namely, Sukhdeo Bihari Lal, Basant Bihari Lal, Nit Bihari Lal and Badri Narain, was tendered on behalf of the defence. The application asked for leave of the court to accept the compromise of the 11th of December, 1912, on the ground that it was beneficial to the rights of the minor plaintiffs. The application was re-dated the 4th of February, 1913. The pleader for Shiam Narain and the other plaintiffs admitted the writing of the application by Shiam-Narain, but objected to it on the ground that it was to be produced in court only on condition that some other matters which did not appear in the application had been settled between the parties out of court and which had not been settled. Objections were filed to the compromise of the 11th of December, 1912, by some other plaintiffs also. The trial court framed an issue with regard to the validity of the compromise and fixed the 16th of April, 1914, for disposal of the issue, directing the parties to produce their evidence, both oral and documentary, on the date of hearing. On the 31st of March, 1913, before the date fixed for hearing of the case, an application was filed on behalf of the parties accepting the compromise of the 11th of December, 1912, with certain amendments. The application was verified by Madho Narain, one of the defendants, for himself and as guardian of his minor brother, Kunwar Bihari Lal. Prabhat Chandra, pleader for the other defendant, namely, Gopal Narain, Verified the application for his client, Babu Binod Bihari Lal verified it for self and Kharagjit Misra, pleader, verified it on behalf of Kishan Dayal, Maha Narain and Shiam Narain in compliance with the application, the 6th clause of the compromise was deleted. The same day a decree was passed in terms of the compromise. The, result of the compromise decree was that the eight plaintiffs, namely, the grandsons of Balmakund, got half of the zamindari property in suit and the three grandsons of Kunj Bihari Lal retained the other half. In other words, instead of getting of the property, the plaintiffs got half the property. Within eighteen months of the compromise decree the two minor sons of Murli Manohar, namely, Basant Bihari Lal and Nit Behari Lal, and the minor brother of Shiam Narain, namely, Badri Narain, brought the suit out of which this appeal has arisen, for the recovery of the difference between the share they would have got under, the Hindu law and the share they were allotted under the decree. They stated in their plaint that they were minors at the time of the suit of 1912 and that the compromise upon which the decree was passed on the 31st of March, 1913, was made without obtaining the leave of the court as was required under the law and that the compromise had injuriously affected their interests. They further alleged that the compromise in question was fraudulent and collusive. The claim was brought against the three grandsons of Kunj Bihari Lal. The other eight persons who were co-plaintiffs in the former suit were not made parties to the present suit. The claim was resisted on various pleas. The court of first instance disposed of the case on the first issue only, namely, whether the compromise decree is valid and binding on the plaintiffs. The learned Judge held that the compromise upon which the decree was passed, was not fraudulent and collusive nor was it injurious to the rights of the minor plaintiffs nor can it be said that it was made without the leave of the court. The other issues raised in the case were not decided. The plaintiffs in appeal to this Court do not challenge the finding with regard to collusion and fraud. They, however, impeach the decree of the court below on the other two points. They contend that the compromise was injurious to their interests and that it was entered into without obtaining the leave of the court. We think that the contention of the plaintiffs appellants must prevail with regard to the omission to obtain leave of the court authorizing the guardian of the minor plaintiffs in the suit of 1912 to enter into a compromise. The learned Judge of the lower appellate court admits that no such leave was granted, but thinks that as the trial court was aware of the fact that there were some minor plaintiffs in the case, the matter was before its mind and the omission to record a formal order is immaterial. We are unable to agree with the learned Judge of the lower appellate court. The law on the subject is embodied in order XXXII, rule 7, which is as follows:—“No next friend or guardian for the suit shall, without the leave of the court, expressly recorded in the proceedings, enter into any agreement or compromise on behalf of a minor with reference to the suit in which he acts as a next friend or guardian. Any such agreement or compromise entered into without the leave of the court so recorded shall he voidable against all parties other than the minor.” The learned counsel for the plaintiffs appellants refers to the following cases, Manohar Lal v. Jadunath Singh Subramanian Chettiar v. Raja Rajeswara Dorai, Jamna Bai Saheb Mohitai Avergal v. Vasanta Rao Ananad Rao Dhybar, Hanuman Rai v. Jagdis Rai, Ganesha Row v. Tuljaram Row(5). For the respondents the argument of the lower court is adopted and in reply to the case law it is contended that their Lordships of the Privy Council in the case of Manohar Lal v. Jadunath Singh remarked as follows. In the opinion of their Lordships there ought to be evidence that the attention of the court was directly called to the fact that a minor was a party to the compromises, and it ought to be shown, by an order on petition or in some way not open to doubt, that the leave of the court was obtained. In the present case it is said that the proceedings of the suit of 1912 leave no doubt that the attention of the trial court was directly called to the fact that some of the plaintiffs in the case were minors and were entering into a compromise. In support of this the proceedings of the 4th of February, 1913, are referred to. We think that the present law is more strict than the dictum of their Lordships in the case of Manohar Lal v. Jadunath Singh, which was given under section 462 of the old Code of Civil Procedure, Act XIV of 1882. Under the old law the words “expressly recorded in the proceedings” did not appear. There is admittedly no order of the court in the suit of 1912 expressly recording permission to Shiam Narain to enter into a compromise on behalf of his minor brother and his minor cousins. Under the second sub-clause of order XXXII, rule 7, the compromise of the 11th of December, 1912, upon which the decree of the 31st of March, 1913, was passed, having been entered into on behalf of the minors without fie leave of the court, is voidable at the instance of the minors. We, therefore, hold that the decree in question is not binding on the present plaintiffs. The case, however, is not disposed of by this finding. It is argued on behalf of the respondents that, even if the compromise decree is not binding upon the plaintiffs, it should not be set aside unless and until it is shown that the compromise in question was in fact injurious to the interests of the minor plaintiffs. The learned Judge of the lower court has found that the compromise inf question was not injurious to the plaintiffs' interests. The reasoning upon which he has come to that conclusion does not commend itself to us. It is conceded on behalf of the respondents that the finding as it stands is insufficient and inconclusive. The learned Judge ought to have taken into consideration the value, of the share of the plaintiffs under the Hindu law to which they were entitled, namely, of the property alleged to have belonged to Chhail Bohari, and the share that was allotted to them under the compromise. It should also have considered the transaction that preceded the compromise, namely, the sale of Muhabbatpur and Mehrabad to the defendants and the sale of a portion of Shabjalpur by the latter to the plaintiffs. There was an allegation that the defendants had paid almost double the price of the plaintiffs' shares in the villages of Muhabbatpur and Mehrabad in consideration of the compromise that was subsequently entered into, that is, in other words in consideration of the plaintiffs' relinquishing a portion of their share in the inheritance. Another point to be considered in the case is, if the plaintiffs are not to be bound by the compromise decree of the 31st of March, 1913, should their claim be decreed in full or should they be put upon terms. The learned Judge of the lower appellate court did not have this question before his mind. We think that this appeal must prevail, but as the case is going back; to the lower court, wo direct that in addition to the issue that it has left untried, it should also try the following issues:—

    (1) Whether the compromise injuriously affected the rights of the plaintiffs?

    (2) Assuming that it the plaintiffs are not bound by the decree of the 31st of March, 1913, are they entitled to recover the property in suit or any of it unconditionally or should they be put upon terms, if so, upon what terms?

    The first issue the court below will try in the light of the remarks we have made above. We, therefore, allow the appeal, set aside the decree of the court below and remand the case for trial under order XLI, rule 23, of the Code of Civil Procedure. The costs of this appeal to abide the event.

    Appeal allowed and cause remanded.

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    Comments

    Badri Prasad v. Gopal Bihari Lal
    (Mar 21, 1919)