Citation Codes

Equivalent Citations

citation codes

Case Number

Original Suit No. 781 of 1908, Appeal No. 19 of 1910

Attorney(S)

Jayakar, with Setalvad, for the appellant.
Desai, for the 1st respondent.
Bhandarkar, for the 2nd and 3rd respondents.

Judges

Sir BASIL SCOTT
SIR S.L. Batchelor

Acts

rule 11 of the 2nd Schedule of the Civil Procedure Code or section 10 of the Indian Arbitration Act,
SECTION 89 CIVIL PROCEDURE CODE
rule 11 of the 2nd Schedule of the Civil Procedure Code
rule 11 of Schedule II of the Civil Procedure Code,
section 19 of the Indian Arbitration Act of 1889,
section 10(b) of the Indian Arbitration Act,
section 10 of the Indian Arbitration Act
provisions of the Indian Arbitration Act
section 104 of the Civil Procedure
section 19 of the English Act
Indian Arbitration Act, 1899,
section 10(b),
section 7(b),

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Smart Summary

Summary of Opinion — Scott, C.J.

Factual and Procedural Background

The appeal was brought against an opinion expressed by a learned Chamber Judge on a special case stated to him. The special case arose from arbitration proceedings connected to Suit No. 781 of 1908 and related arbitration agreements between the plaintiff and the defendants. The reference to arbitration was said to be pursuant to a Consent Judge's Order dated 16th July (the opinion contains both 1903 and 1909 as dates in different places) and also pursuant to agreements dated 9th July (the opinion contains the year 1903 and 1909 in different clauses).

The suit was instituted for partition of certain properties of a joint family (other than immoveable properties situate outside the Court's jurisdiction). Two agreements were entered into on 9th July (date as stated in the special case) by which the parties agreed to refer questions to two arbitrators, Messrs. Tribhuwandas Narotamdas Malvi and Merwanji Kaikhusro Alpaiwalla. One agreement was adopted by a Consent Judge's Order and declared to be for the benefit of the 3rd defendant and sanctioned; the other agreement covered properties not within the suit and was governed by the Indian Arbitration Act.

The special case set out differing awards/opinions by the two arbitrators as to whether sums should be set aside for marriage expenses of Keshavdeo (the 3rd defendant) and for maintenance/marriage/"Moklava" expenses of Bai Ratni (the 1st defendant's daughter). Clause 14 of the special case framed three questions of law for the Court's opinion about whether reasonable sums should be set apart for (1) Keshavdeo's marriage, (2) Ratni's maintenance/marriage/"Moklava", or (3) alternatively a sum be presented to Ratni for those purposes.

The appeal challenges the Chamber Judge's opinion on these questions of law as presented in the special case.

Legal Issues Presented

Whether an appeal lies from the opinion of the Court upon the special case presented by the arbitrators.
Whether the instrument before the Court is an "award stated in the form of a special case" (capable of adoption as an award) or is merely a special case stating questions of law for the Court's opinion.
Whether the submission falls under rule 11 of the 2nd Schedule of the Civil Procedure Code (references under court order) or under section 10(b) of the Indian Arbitration Act (arbitrators stating questions of law), and the consequences of that classification for the right of appeal.
If the instrument were an award in the form of a special case, whether an appeal would lie under section 104 of the Civil Procedure Code.

Arguments of the Parties

Appellant's Arguments

Counsel for the appellant argued that the special case before the Court is in substance an award stated in the form of a special case which the arbitrators were competent to submit either under rule 11 of the 2nd Schedule of the Civil Procedure Code or under section 10 of the Indian Arbitration Act.
On that basis, the appellant contended that an appeal is expressly provided for by section 104 of the Civil Procedure Code.

Respondent's Arguments

The opinion does not contain a detailed account of the respondent's legal arguments.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
In re Knight and Tabernacle Permanent Building Society	Decisions in England referenced for two related propositions: (a) that if arbitrators are merely stating a case for the opinion of the Court before they have made an award, no appeal lies; and (b) in the Court of Appeal decisions, that an appeal lies from the opinion of the Court expressed upon an award stated in the form of a special case.	The Court relied on these English decisions to explain the distinction: where there is only a statement of questions of law (no award), no appeal lies; but if there had been an award stated in the form of a special case, an appeal would lie under section 104 CPC. The Court used this precedent to test whether the special case at hand amounted to an award or merely a statement of questions for opinion.
In re Holland Steamship Company and Bristol Steam Navigation Company	Cited as authority for the proposition that, with reference to the comparable provision in English law, no appeal lies where arbitrators merely state a case for the opinion of the Court before making an award.	The Court cited this decision as part of the authorities showing that a mere statement of a case before an award does not give rise to an appeal.
In re Kirkleatham Local Board and Stockton & Middlesbrough Water Board	Cited (by the Court of Appeal in England) for the proposition that an appeal lies from the opinion of the Court expressed upon an award stated in the form of a special case.	The Court invoked this decision to explain that, had the present instrument been an award stated in the form of a special case, the appellant could have a right of appeal under section 104 CPC; however, the Court concluded the present instrument was not such an award.

Court's Reasoning and Analysis

The Court began by identifying the preliminary question: whether any appeal will lie from the Chamber Judge's opinion on the special case. The opinion differentiates between two procedural schemes depending on how an arbitration is constituted:

Where there is a reference with the intervention of a Court of justice (i.e., by order of the Court), the provisions of the Indian Arbitration Act do not apply and the arbitrators' powers are governed by rule 11 of the 2nd Schedule of the Civil Procedure Code. Under rule 11 the arbitrator may, with the Court's leave, state an award as to the whole or any part thereof in the form of a special case for the opinion of the Court, and the Court's opinion shall be added to and form part of the award.
Where the agreement is not under a Court order (i.e., separate arbitration agreement), the provisions of the Indian Arbitration Act apply; section 10(b) of that Act gives arbitrators the power to state a special case for the opinion of the Court on any question of law involved.

The Court noted that the Indian provision at section 10(b) corresponds to section 19 of the English Act (which permits arbitrators to state questions of law for the Court), while rule 11 of the 2nd Schedule follows the wording of section 7(b) of the English Act (which permits awards to be stated in the form of special cases).

The critical factual-legal point was whether the instrument before the Court was an award stated in the form of a special case (which, under English authority and section 104 CPC, could give rise to an appeal) or whether it was merely a statement of questions of law for the Court's opinion (which, prior to any award, does not give a right of appeal).

In applying the law to the special case at hand, the Court observed:

The special case disclosed a difference of opinion between the two arbitrators and there had been no reference to an umpire as provided in the agreement (the agreement contemplated that, in case of disagreement between arbitrators, the matter should be referred to an umpire who could make an award).
The mere use of the word "award" in clauses 12 and 13 of the special case did not convert the submission into an award in form of a special case. The Court considered that use of the word "award" was mistaken for that purpose.
There was no agreed sum mentioned in the special case that would amount to an award fixing the amount to be set aside; the special case left open the possibility that the Court might take a view different from either arbitrator.

On these bases the Court concluded that the special case was not an award and could not be adopted by the Court merely by expressing its opinion. Consequently, the Court held the matter to be a statement of questions of law for the Court's opinion, not a rule 11 award. Because the part of the arbitration that related to the agreement adopted by the Consent Judge's Order implicated the procedure under the Court's order while the other agreement fell under the Indian Arbitration Act, the Court ultimately treated the present instrument as falling under section 10 of the Indian Arbitration Act (insofar as it related to the agreement not the subject of the Consent Order) and therefore concluded that no appeal lay.

Holding and Implications

APPEAL DISMISSED. The Court dismissed the appeal with costs.

Direct effect: the Chamber Judge's opinion on the special case stands and the appellant's challenge is unsuccessful. The Court held that the instrument before it was not an award stated in the form of a special case but a statement of questions of law for the opinion of the Court, and on that basis no appeal lies (the Court referred to the distinction between rule 11 of the 2nd Schedule CPC and section 10(b) of the Indian Arbitration Act to reach this conclusion).

This opinion does not purport to establish broader new principles beyond the stated application of the statutory distinction and the cited English authorities; the direct legal consequence recorded in the opinion is the dismissal of the appeal and the allocation of costs to the respondent.

Other information appearing in the opinion:

Appeal dismissed. Attorneys for the appellant: Messrs. Malvi, Hiralal, Mody and Ranchhoddas. Attorneys for the respondent: Messrs. Bicknell, Merwanji and Romer.

K.MCI.K

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Purshotumdas Ramgopal v. Ramgopal Hiralal

Scott, C.J:— The question arises in this case at the outset whether any appeal will lie.

The appeal is preferred against an opinion expressed by the learned Chamber Judge upon a special case stated to him, purporting to bo stated in the matter of an arbitration between the plaintiff and the defendants in Suit No. 781 of 1908, pursuant to a Consent Judge's Order of the 16th July 1903 and in the matter of the Indian Arbitration Act, 1899, and an arbitration between Purshotumdas Ramgopal, and Ramgopal Hiralal, Badrinarayan Ramgopal and Keshavdeo Ramgopal, pursuant to an agreement between them, dated the 9th July 1909. The parties to this last-named agreement are the parties to Suit No. 781.

The special case states that the suit was instituted for partition of the properties other than the immoveable properties situate outside the jurisdiction of the Court belonging to the joint family consisting of the plaintiff and the defendants. On the 9th of July 1903 two agreements were entered into between the parties.

Clause 3 of the special case states :—

“By the first agreement the parties agreed inter alia to refer to the award, determination and final arbitration of Messrs. Tribhuwanda Narotamdas Malvi and Merwanji Kaikhusro Alpaiwalla, Attorneys of this Honourable Court, to ascertain and determine the moveable properties and assets specified in the said agreement belonging to the said joint family in which the said arbitrators might hold the said Purshotum Ramgopal entitled to the reliefs elaimed in the above suit and to effect, a partition of the said properties between the parties on the footing that each of them was entitled to an equal one fourth share therein.”

Clause 4 says :—

“By the second agreement the parties agreed to refer to the award, determination and final arbitration of the said Messrs. Tribhuwandas Narotamdas Malvi and Merwanji Kaikhusro Alpaiwalla to ascertain the properties other than those that may bo held by the said arbitrators to bo covered by the aforesaid suit and to take necessary accounts in respect thereof, and to effect a partition thereof between the parties on the footing aforesaid.”

Clause 5 states :—

“By a Consent Judge's Order, dated the 16th July 1909, made in the said suit, the said first agreement of reference was declared to be for the benefit of the 3rd defendant and sanctioned, and it was ordered that the matters mentioned in the said agreement of reference be referred to the arbitration of the said arbitrators.”

Then the case proceeds to state certain questions which have arisen as to whether moneys should be set apart for the marriage expenses of certain male and female members of the family and for the maintenance of a girl named Ratni. Clauses 12, 13 and 14 are as follows:—

“12. The arbitrator Tribhuwandas Narotamdas Malvi awards that no sum should be set apart for the expenses of marriage of Keshavdeo, or for the expenses of marriage and ‘Moklava’ and maintenance of Ratni; nor, in the alternative, any sum presented to her which may be appropriated for her marriage expenses.

“13. The arbitrator Merwanji Kaikhusro awards that a reasonable sum should be set apart for the expenses of marriage of Keshavdeo and for the expenses of marriage, ‘Mokava’ and maintenance of Ratni; or, in the alternative, a reasonable sum may be presented to her out of the joint family property which may be appropriated for her marriage expenses.

“14. The questions of law for the opinion of the Court are whether before partitioning the said joint family properties a reasonable sum should be set opart by the arbitrators out of the said properties:

“(1) To provide for the marriage expenses of the 3rd defendant Keshavdeo, the unmarried son of Ramgopal Hiralal, the 1st defendant, and

“(2) To provide for the maintenance, marriage and ‘Moklava’ expenses of Bai Ratni, the unmarried daughter of the 1st defendant,

“(3) Or, in the alternative, a reasonable sum may be presented to her which may be appropriated for her marriage and ‘Moklava’ expenses.”

It was necessary to provide for the reference to the arbitrators by the two agreements because owing to want of jurisdiction all the questions between the parties could not be raised in the suit in which the Consent Order was made.

Now, where there is a reference with the intervention of a Court of justice, the provisions of the Indian Arbitration Act do not apply, and the powers of the arbitrators are governed by the 2nd Schedule of the Civil Procedure Code. (See the preamble to the Indian Arbitration Act and section 89 of the Civil Procedure Code.) Therefore, with regard to the arbitration so far as it affects the subject of the suit, the arbitrators could only take the opinion of the Court under rule 11 of Schedule II of the Civil Procedure Code, which provides that upon any reference by an order of the Court, the arbitrator or umpire may, with the leave of the Court, state the award as to the whole or any part thereof in the form of a special case for the opinion of the Court, and the Court shall deliver its opinion thereon and shall order such opinion to be added to and form part of the award. With regard to the other agreement of the 9th of July the provisions of the Indian Arbitration Act apply. The only section of that Act, which gives the arbitrators power to take the opinion of the Court, is section 10(b), which provides that they shall have power to state a special case for the opinion of the Court on any question of law involved.

It is conceded that if the arbitrators are merely stating a case for the opinion of the Court before they have made an award no appeal lies, as has been decided, in England with reference to section 19 of the Indian Arbitration Act of 1889, in In re Knight and Tabernacle Permanent Building Society and In re Holland Steamship Company and Bristol Steam Navigation Company. It is, however, contended that this special case is an award in the form of a special case which the arbitrators were competent to submit either under rule 11 of the 2nd Schedule of the Civil Procedure Code or section 10 of the Indian Arbitration Act, and that an appeal is expressly provided for by section 104 of the Civil Procedure Code.

With reference to the scope of section 10(b) of the Indian Arbitration Act, it is material to note that in the English Arbitration Act, upon which the indian arbitration act was based, there are two sections providing for references to the Court by arbitrators, namely section 7(b), which permits the arbitrators to state an award as to the whole or part thereof in the form of a special case for the opinion of the Court, and section 19, which permits them to state, in the form of a special case for the opinion of the Court, any question of law arising in the course of the reference. It appears to us that the legislature in framing section 10(b) of the Indian Arbitration Act has deliberately followed the wording of section 19 of the English Act and in framing rule 11 of the 2nd Schedule of the Civil Procedure Code has followed the wording of section 7(b) of the English Act.

According to the decisions of the Court of Appeal in England in In re Knight and Tabernacle Permanent Building Society and In re Kirkleatham Local Board and Stockton & Middles borough Water Board(3), an appeal lies from the opinion of the Court expressed upon an award stated in the form of a special case, and that is provided for by section 104 of the Civil Procedure Code.

It has, therefore, been necessary for counsel on behalf of the appellant to argue that the special case with which we are concerned is an award stated in the form of a special case. This argument is only material with reference to the arbitration proceeding under the Consent Judge's Order of the 16th of July. The agreement which was adopted by that order provides that “the arbitrators are authorised from time to time to make an interim award or awards or make or direct partial distribution or distributions of the said property and in case the said arbitrators shall by reasen of disagreement or any other cause fail to make an award or determine any matter or matters hereby referred to them, the matter or matters as to which there shall be such failure be and they are hereby referred to the umpirage and decision of such person as the said arbitrators shall before entering upon this reference appoint to act as umpire who shall likewise have authority to make an interim award or awards.” The agreement, therefore, provides that in the case of disagreement between the arbitrators which prevents them from making an award such as is contemplated in the agreement, the matter in difference is to be referred to an umpire who shall make the award.

Now, the special case discloses a difference of opinion between the arbitrators, and there has been no reference to any umpire; and we are unable to hold that the mere use (in our opinion, a mistaken use) of the word “award” in clauses 12 and 13 of the special case, converts a reference to the Court for its opinion upon a difference between arbitrators into an award in the form of a special case. The special case is in no sense an award. The award would have to provide, if any provision is in law necessary for the expenses of the marriage of Keshavdeo or of Ratni, what sum should be set aside; but no sum is mentioned in the case as having been agreed upon between the arbitrators as a reasonable and proper sum. Again, the special case leaves it open to the Court to take a view which is not the view of either of the arbitrators upon the questions submitted.

There is, therefore, no award which can be adopted by the Court by the mere expression of its opinion, and the case can only be, as it is expressed to bo in clause 14, a statement of a question of law for the opinion of the Court.

We are of opinion that this is not a case which falls under rule 11 of the 2nd Schedule of the Civil Procedure Code; but that it falls under section 10 of the Indian Arbitration Act in so far as it relates to the agreement which was not the subject of the Court's order of the 16th July 1909; and that, therefore, no appeal lies.

We dismiss the appeal with costs.

Appeal dismissed.

Attorneys for the appellant: Messrs. Malvi, Hiralal, Mody and Ranchhoddas.

Attorneys for the respondent: Messrs. Bicknell, Merwanji and Romer.

K.MCI.K

Purshotumdas Ramgopal v. Ramgopal Hiralal

Summary of Opinion — Scott, C.J.

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant's Arguments

Respondent's Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Purshotumdas Ramgopal v. Ramgopal Hiralal

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