The Judgment of the Court was as follows:—
Rankin, J.:— This is an application by an attorney under r. 69, Chap. 36 of the High Court Rules for an order against his client for payment of the sums amounting to Rs. 531-14 allowed on taxation of four bills of costs in respect of non-contentious business. It appears that the attorney also acted for the client in several other proceedings being certain execution cases in one of which a considerable sum of money was recovered by the attorney and was put into his hands on behalf of his client. Differences of opinion arose between the parties as to whether the particular or active lien of a solicitor in respect of the sum of money so received was available for his costs in all or in only one of the execution matters, but, by an order obtained from Mr. Justice Buckland the attorney hag succeeded in having it declared that his particular or active lien extends to all these contentious proceedings.
The main difficulty now is due to the fact that before the money in question was received by the attorney over three years had elapsed since the completion of the, work, comprised in each of the four bills of costs. The order of Mr. Justice Buckland, as I construe it, merely detected that these bills of costs should be taxed and that any moneys over and above the amount which in any event would be sufficient to satisfy the attorney's claim should be repaid by the attorney to the client at once. It in no way decided whether these bills of costs were in fact due from the client to the attorney or not, but it did declare that to the extent to which these bills, when taxed, were due and payable the attorney should have a right to a set off. In addition to the particular or active lien which an attorney has upon moneys which have been recovered in a suit, the attorney has a general or passive or retaining lien upon all movables deeds, documents, and so forth that come into his hands unless they come for a specific purpose which would be inconsistent with the right of retainer but Mr. Justice Buckland in this case has definitely decided, as appears more clearly from his judgment than from the form of the Order, that with regard to the four bills of costs in question the attorney has not got the right to exercise any lien.
Now the law on the subject, so far as it is necessary to state it, stands thus. By sec. 28 of the Limitation Act of 1908 it is provided that “on the determination of the period hereby limited to any person for instituting a suit for possession of any property his right to such property shall be extinguished;” but in the case of a personal action for a debt limitation merely bars the Plaintiff from having the particular remedy by way of suit and does not extinguish the debt. Thus if the attorney has any form of lien upon property in respect of his bills of costs he can exercise that lien notwithstanding that by the terms of the Limitation Act, he could not bring a suit. The next proposition of law which is of some importance is this that so far as the position of a Defendant asserting a right of set off is, concerned the limitation bar does apply to him. It applies to him as if he were bringing an independent suit of his own the only difference being that where he is defending himself by way of set off, if his claim was not barred at the time of the issue of the plaint, he may prosecute a set off even although the time may have elapsed before his filing, say, a written statement claiming the set off. But with that exception as to the terminus ad qucm of the period of time, it is the law in India as well as in England that limitation applies to a set off. Now in this case the question, of passive lien or right of retainer having been disposed of by Mr. Justice Buckland's judgment and the right of set off being subject to the principle of limitation, it is or may be a matter of real importance whether under r. 69 I can make an order against the client for payment.
On the affidavits, which are very short, there is in essential matters no substantial dispute: the contention expends itself upon things which matter little now. The retainer, the fact that the work is done, and the proper charges therefor are all beyond dispute. As regards one of the bills, an objection is mentioned in the attorney's own affidavit. It refers to the bill for Rs. 287 in the matter of the Landora estate. It was not apparently taken before Mr. Justice Buckland, but is one of the objections mentioned or raised before the Taxing Officer. The objection is that by the terms of the letter of retainer in this particular matter, the attorney was to look for his costs, not to his client, the prospective mortgagee, but to the prospective borrower or mortgagor. If any real case of this sort was disclosed, I should except this particular bill from my order, but on the terms of the letter it is as plain as possible that there is no foundation for the contention that the attorney was to act upon the footing that his client should not be liable for costs as distinct from the usual arrangement that the mortgagor shall pay the mortgagee's costs incidental to the loan. That letter has been set out in the attorney's affidavit. The affidavit in answer says merely this: “I am advised that the contention of the Raja that the bill of costs re: Landora estate is not payable by him is valid.” I have no facts at all before me upon which I can be satisfied that there is in this matter any bonâ fide or substantial dispute as to the existence or non-existence of a special bargain between the attorney and the client. Nowhere do I find it stated that on such and such a date a verbal bargain was made to that effect; nowhere do I find in the affidavit of the Respondent a case whose Seriousness or bonâ fides can be investigated to the effect that this attorney was to act for the lender but was to look entirely to the borrower for his costs. There is no doubt, moreover, that the transaction fell through and neither the letter nor anything else in evidence discloses any case at all for so extraordinary a bargain as that the attorney should do work for a lender upon the terms that even if the loan went off, the lender should not be answerable for his own costs. There is, in my opinion, no matter for enquiry; no matter which needs to be elucidated in a suit, the jurisdiction of the Court under the rule is not ousted by a mere statement from the lips out wards, disclosing a willingness on the part of the client to contend something for which he can indicate no concrete case.
The bills of costs were taxed and the attorney retained a certain amount and refunded the surplus stating at the time to the client that when the Court reassembled after the vacation he would make an application for the purpose of determining whether he was entitled to pay himself out of the moneys so retained. The first objection with which the attorney is met is that he cannot get an order for payment under r. 69, because he has already been paid. In my opinion there is no substance in that objection more particularly having; regard to the fact that by his letters the attorney has retained the moneys carefully setting out that lie will apply, to substantiate his right. How little, substance there is in that objection may, I think, be clearly seen by considering it from the point of view of the client. The client claims that money is his, that there is no debt and that nothing the attorney can do will entitle him to appropriate that fund. Claiming that, he can not be heard to say that an order for payment cannot be made against him because the attorney has already been paid.
I come now to the question which arises by reason of the lapse of time between the completion of the work and the receipt by the attorney of the money. It is alleged by the attorney in his affidavit that, from time to time. He had made out his bills of costs in respect of the various cases and matters including four bills now in question and that he made them over to his client for examination. “I had also from time to time asked Raja Narendra Lall Khan to pay me the said costs including those mentioned in the second paragraph and the said Raja Narendra Lall Khan had on Beveral occasions personally requested me that I should wait until his dues should be realised in the said execution cases and should take my costs out of the moneys so realised, and in compliance with such request I did not take any steps to enforce payment, of my said costs. The answer to that and the only answer, in the affidavit of Ramgati Muklierji, the agent of the client, is, “I admit that the said Babu Hirendra Nath Dutt made over certain untaxed bills' but have no knowledge that the said Raja Narendra Lall Khan personally requested him to wait for payment until his dues in the execution case be realised or that the said Raja suggested that the costs, of the said Babu Hirendra Nath Dutt should be deducted from the costs when realised.” In that state of affairs there is no denial, no statement even that the client had informed the deponent that the statement of the attorney, upon oath, was untrue. I feel, therefore, both entitled and obliged to act upon the footing of its truth.
The first question which arises there fore is whether upon un-contradicted matter there is not an answer to any objection based upon limitation. In my opinion the evidence of the attorney is good and sufficient evidence of a verbal promise on the part of the client, a promise given for consideration to pay the attorney when money was recovered in the execution cases. This view agrees with a principle whose illustrations are well known. “A promise to guarantee a debt if the creditor will give time to the principle debtor is in the first instance an offer. It becomes a binding promise when the condition of giving a specified time or a reasonable time has been performed.” (Bullock on Contracts, 7th Ed., p. 202). I see no answer upon the present evidence I to this contention, but Mr. Pugh has contended that if there is any special bargain of the sort, r. 69 cannot be applied. In my opinion, unless the special bargain is a matter of dispute the rule is in no way inapplicable. It says nothing about the attorney's retainer or about an original or subsequent bargain. The test is whether there are in the end any questions requiring to be elucidated in a suit. If not, the only other condition is that the application shall be one for payment of the amount of a taxed bill of costs. On this view it is unnecessary for me to consider the somewhat difficult questions that have been discussed upon the assumption that if the attorney were to bring a suit, for the recovery of this money he would be debarred by the Limitation Act but I will deal shortly as an alternative method of disposing of this application with the question on that footing.
It has been held by authority in this Court, following authority in the Bombay Court, that under the Rule in question neither Art. 84 nor Art. 181 of the Limitation Act applies. Art. 84 does not apply because the proceeding is not a suit; Art. 181 does not apply, as Mr. Pugh for the Respondent is constrained by the decisions to admit, because this application is not an application contemplated by the Civil Procedure Code. The result is that r. 69 is technically free from the Statute of Limitation. This matter having been drawn to the attention of Mr. Justice Chaudhuri in this Court, in the case of Lukhimoni Dasi v. Bajendra Nath Mukherji (1), that learned Judge makes, this observation:—
“If there is no special rule of limitation, discretion has to be exercised in allowing such applications which are of a summary nature. The rule itself provides for an alternative relief, viz. relief by suit, and such a suit can only be instituted within the time allowed under Art. 84 of is the Limitation Act and it therefore seems to me that in exercising discretion with regard to such an application when a question, of lapse of time is raised it should be considered whether the time allowed by Art. 84 ought not to be the time limited.” I observed that the learned Judge there used very guarded language and as his observation is only obiter this is not unnatural. I do not feel quite certain whether the inclination of his opinion was that the time limit should be imposed in all cases by an analogy drawn from Art. 84 or that in every case it was a question to be considered as a matter of discretion, upon the special facts. In any case Mr. Pugh for the Respondent contends that any discretion, in order to be sound, must be so restricted and controlled by analogy from the Limitation Act; and he adds the further contention that save on this condition r. 69 of Chap. XXXVIII of the Rules of this Court is ultra vires. It appears that the substance of the rule was introduced into this Court in 1905 from the Rules of the Bombay Court which have contained this provision for over 40 years. It must be admitted also that Mr. Pugh has against him on both the contentions just mentioned the case of Wadia v. Purshotam Sivji (2) and a very considerable body of judicial opinion therein cited. As to the rule being ultra vires I think it is-either valid or invalid as it stands it is not conditionally valid or conditionally invalid. I think it is impossible to hold that, because the Limitation Act sets a limit only to suits and applications contemplated by the Civil Procedure Code and has provided none for other application, therefore the High Court's power under its charter to make rules to regulate proceedings can never be exercised by providing special forms or opportunities of making applications to the Court. There is nothing in the case of Chunilal Jethabhai v. Dahyabhai Amulakh (3) which warrants or countenances this contention. It was, concerned with an appeal as to which specific provision had been made, by the Limitation Act.
The contention that under r. 69 any discretion in order to be right must be exercised only within the limits set by analogy from Art. 84 is, I think, much more serious. One naturally assumes that the intention of the rule was not to enlarge the rights of any parties but to enable a more Summary remedy to be given in cases which did not require the more elaborate procedure of a suit. It has, however, to be observed that when this rule was borrowed from Bombay, decisions in Bombay had for a considerable time been to the effect that the Limitation Act did not narrow what the Court under this rule ought to do. The case already cited, and the cases therein relied on, show that the Bombay High Court, under this Rule, have made orders either without enquiring into the question of limitation though raised, or in spite of the knowledge that limitation would have barred a suit.
Further and apart from these cases is a case of Ramhari Sahu v. Madanmohan Mitter (4): a Division Bench of this Court dealt with an application which could be regarded either as made under a rule of the Court which was technically free from any statutory limitation or as made under sec. 558 of the old Code which attracted Art. 168 of the Limitation Act. The application was allowed though the matter was purely discretionary in its nature and although-under the Code it would have been barred. I do not think it open to me oil the authorities to lay down an abstract or a priori rule to the effect that it is necessarily wrong to exercise this discretion in a case where a suit could, not succeed; any such rule must be laid down if at all, by a higher tribunal. I think my discretion is to be exercised in the present state of the authorities upon the well-known lines, and in the well-established manner on the particular facts of each case: “The Limitation Act,” as was said in a case already cited; Chunilal Jethabhai v. Dahyabhai Amulakh , “being an act of a restrictive character must be strictly construed.”
In the present case, it appears from, what I have said already that there is a special state of facts strikingly in favour of the applicant. On an application such as this I think it makes all the difference when a question of lapse of time is raised whether the Court is dealing with a position in which the facts are not really in controversy or with a matter as to which real and substantial dispute upon the facts is shown. If upon examination it appears that a real dispute exists as to the facts, then not only would a suit be safer, form of remedy for other reasons, but the principle of limitation is itself a highly desirable safeguard. Here, however, that is not so, and a very strong appeal to have the Court's discretion exercised in his favour is made by an attorney who can show without serious challenge such a course of conduct on his client part as I have here to deal with. The statutes of limitation, still less the principles of limitation, are not intended as an aid to unconscionable conduct though necessarily in securing other ends they afford scope for this. In this case I can see no other end to be secured because I think the more summary remedy can be given safely upon unchallenged facts. The debt subsists its justice is unimpeachable; the appeal to the analogy of Art. 84 is on the un-challenged evidence of the attorney made in circumstances which render it not merely shabby but discreditable. In that state of affairs, if it be a matter of discretion, I answer that if I have the power I have the will. I must be shown that statutory provision or recognised judicial principle forbids, I cannot vouch judicial discretion for extending by analogy a restrictive statute in sacrifice of all the merits of the case.
The application succeeds with costs.
S.C.M
Application allowed.