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  • Sir Charles Arnold White
  • C. J.
  • Sankaran Nair
  • Oldfield, JJ.
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citation codes
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Judges
  • Sir Charles Arnold White
  • C. J.
  • Sankaran Nair
  • Oldfield, JJ.
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Smart Summary

Summary of Opinion: "Order of Reference to a Full Bench"

Factual and Procedural Background

A decree was entered against the petitioner by a single judge of the Madras Court of Small Causes. The petitioner applied to the Small Cause Court, under Section 38 of the Presidency Small Cause Courts Act, 1882, for a new trial and to set aside that decree. The application was rejected by a Full Bench on the ground that the applicant had not paid the full amount under the decree at the time of presenting the application, as required by Order 41, Rule 2 of the Presidency Small Cause Court Rules. The petitioner then applied to the High Court seeking to set aside the Full Bench's order on the ground that Order 41, Rule 2 was ultra vires because it contravened Section 38 of the Act. The High Court referred the question to a Full Bench for decision whether Order 41, Rule 2 is ultra vires.

Legal Issues Presented

  1. Whether Order XLI (41), Rule 2 of the Presidency Small Cause Court Rules is ultra vires.
  2. Whether the High Court, by framing rules under Section 9 of the Presidency Small Cause Courts Act (as amended in 1895), can make rules that cut down or abridge the jurisdiction conferred on the Small Cause Court by Section 38 (i.e., whether rule-making power extends to matters of substantive right or is confined to practice and procedure).
  3. Whether the right to apply for a new trial under Section 38 is a substantive right (not merely a matter of practice or procedure) and therefore beyond the High Court's rule-making power under Section 9.

Arguments of the Parties

Appellant (Petitioner) — represented by Mr. C. Krishnamachariar for Mr. K. Bhashyam

  • Submitted that O. 41, R. 2 is ultra vires because it abridges the right to apply for a new trial given by Section 38 of the Presidency Small Cause Courts Act.
  • Relied on the general principle (cited from Reg. v. Bird. Needles, ex parte) that regulations made under a statute cannot abridge a right conferred by that statute.
  • Argued that the High Court's rule-making power is limited to matters of practice and procedure and cannot affect substantive rights; cited authorities such as Attorney-General v. Sillem and R v. Pawlet, Morgan v. Bowles and In re West Devon Great Consols Mine to support that a condition imposed before exercising a statutory right is not merely procedural.

Respondent — represented by Mr. P. M. Sivagnana Mudaliar

  • Maintained that Order 41, Rule 2 is a wholesome rule that had been in force for 30 years.
  • Argued that Section 38 does not confer any right on a party to apply for a new trial (relying on Poyser v. Minors(6)).

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Reg. v. Bird. Needles, ex parte The general rule that regulations made under a statute cannot abridge a right conferred by that statute. The Court acknowledged this general rule but observed that if the statute itself vests a power in a rule-making authority, rules within that authority's power could be valid even if they appear to abridge a statutory right; thus the Court examined whether the rule fell within the High Court's statutory power.
Attorney-General v. Sillem Authority for the proposition that the right of appeal is not merely a matter of practice or procedure; it is a substantive right to invoke a superior court's aid. The Chief Justice cited Lord Westbury's observations to support the conclusion that the right to seek review by a higher forum (analogous to the right to apply for a new trial) is not mere procedure and therefore not within a rule-making power confined to practice and procedure.
Colonial Sugar Refining Company v. Irving (House of Lords) Observation (Lord Macnaghten) distinguishing depriving a suitor of a statutory right of appeal from merely regulating procedure. Used to bolster the argument that rights to invoke a superior tribunal are not part of mere procedural regulation; supported the Court's analogy between appeal rights and the right to apply for a new trial.
Morgan v. Bowles Authority involving the interpretation of rules and statutory obligations to give security for costs; cited in argument that condition precedent to a statutory right is not merely procedural. The Chief Justice held that Morgan v. Bowles did not materially assist the question before the Court, since it turned on construction of language and specific statutory context relating to security for costs rather than the present rule-making power issue.
R v. Pawlet Cited by petitioner for the proposition that imposing a condition before the exercise of a right is not merely practice or procedure. Referenced in argument; the Court examined the general principle but focused on whether the contested rule fell within the High Court's delegated power rather than relying directly on this authority.
In re West Devon Great Consols Mine Illustrates principles of statutory construction (generalia non specialibus derogant) and concerns about whether rules purported to abrogate statutory provisions. The Court observed that this authority decided a construction question and that the Rule Committee had not purported to abrogate the statutory condition; the Chief Justice treated it as not directly helpful to the present ultra vires question.
Poyser v. Minors(6) Invoked by respondent to support the proposition that Section 38 does not confer a party's right to apply for a new trial. Mentioned in the respondent's submissions; the Court's opinion does not adopt this view and instead construed Section 38 as giving a party a right to apply for a new trial.

Court's Reasoning and Analysis

The Chief Justice framed the central question as whether Order XLI, Rule 2 is ultra vires. The rule requires that an applicant for a new trial must, when presenting the application, either deposit the amount due under the decree or give security for performance to the satisfaction of the Court or Registrar.

The Court analyzed the statutory scheme: Section 38 of the Presidency Small Cause Courts Act authorizes the Small Cause Court, "on the application of either party" (made within eight days), to order a new trial or alter/set aside/reverse the decree "upon such terms as it thinks reasonable." The Rules were promulgated under Section 9 of the Act as amended in 1895, which transferred rule-making power to the High Court; the 1895 amendment thus broadened the High Court's role in framing rules for the Small Cause Court.

The Court accepted the general principle (from Reg. v. Bird. Needles, ex parte) that regulations should not abridge statutory rights, but clarified that if the statute expressly vests broad rule-making powers in an authority, rules made within the scope of that power may be valid even if they affect statutory rights. Consequently, the determinative issue became whether Section 9 (as amended) empowered the High Court to make rules that regulate substantive rights or whether its power was confined to matters of practice and procedure.

The Chief Justice concluded that the statutory power to make rules was properly construed as limited to matters of practice or procedure and not to substantive rights. He then addressed whether the right to apply for a new trial under Section 38 is substantive or merely procedural. Although Section 38's language is not expressed in explicit terms that a party "has a right" to apply, the Court construed Section 38 as conferring on a party the right to apply for a new trial. The Court drew an analogy to the right of appeal, citing authorities (Attorney-General v. Sillem; Colonial Sugar Refining Co. v. Irving) to support that rights to seek redress in a superior forum are not simply matters of practice or procedure.

The Chief Justice distinguished the other authorities cited (Morgan v. Bowles and In re West Devon Great Consols Mine) as being cases of construction or specific facts about security for costs and not directly helpful to determining whether the High Court's rule-making power included the impugned rule. He further noted that no other power outside Section 9 had been shown to permit the High Court to make a rule cutting down the jurisdiction conferred by Section 38.

For these reasons, the Chief Justice concluded that Order XLI, Rule 2 was not within the rule-making power conferred on the High Court (limited to practice and procedure) and therefore was ultra vires.

Holding and Implications

Holding: The Full Bench (High Court) held that Order XLI, Rule 2 of the Presidency Small Cause Court Rules is ultra vires.

Implications:

  • The rule requiring deposit of the decree amount or security at the time of presenting an application for a new trial was declared invalid because it exceeded the High Court's rule-making power under the relevant statute as construed by the Court.
  • The decision indicates that the High Court's rule-making power under Section 9 (as introduced in 1895) is confined to matters of practice and procedure and does not extend to abridging substantive rights conferred by statute (here, the right to apply for a new trial under Section 38 as construed by the Court).
  • The opinion notes the broader importance of the question and acknowledges that the validity of numerous decisions and procedural practice may be affected, since the rule had been in operation for many years; the Court observed the question to be of great importance and potentially affecting the procedure of the Small Cause Court.
  • No further remedial orders or specific directions in this opinion are recorded beyond the declaration that the rule is ultra vires; the direct effect is that the rule can no longer be relied on as a valid basis to refuse applications for new trials.
Rule ultra vires.

Concurring: Sankaran Nair, J. and Oldfield, J. agreed with the Chief Justice's conclusion.

Show full summary ...

    Madurai Pillai v. T. Muthu Chetty

    ORDER OF REFERENCE TO A FULL BENCH

    Sankaran Nair, J. — A decree was passed against the petitioner by a single judge of the Madras Court of Small Causes. He made an application to the Small Cause Court to order a new trial and to set aside the decree, under Section 38 of the Presidency Small Cause Courts Act, 1882. That application was rejected by the Full Bench on the ground that the full amount under the decree was not paid at the time of presenting the application, as required by Order 41, rule 2, of the Presidency Small Cause Court Rules. The petitioner now applies to this Court to set aside the order of the Small Cause Court, on the ground that the rule above referred to is ultra vires as it contravenes Section 38 of the Presidency Small Cause Courts Act and that, therefore, they were wrong in rejecting his application.

    Section 38 runs in these terms.

    “Where a suit has been contested, the Small Cause Court may, on the application of either party,……order a new trial to be held, or alter, set aside etc.”

    Order 41, rule 2, runs in these terms:—

    “No application shall be entertained, unless the applicant shall, at the time of presenting his application, either deposit in Court the amount due from him under the decree or order, or give security to the satisfaction of the Court or the Registrar, for the performance of the decree or order in respect of which the application is made”

    The general rule is that, where a power to make regulations is given by a statute, no regulations made under it can abridge a right conferred by the statute itself. [See Reg. v. Bird. Needles, ex parte. Now, in this case, the section confers no right upon the petitioner himself. He cannot, therefore, complain that any right of his has been taken away by the regulations.

    The next question is, whether the right which is vested in the Small Cause Court under Section 38, has been taken away by the regulations. The section states that the Small Cause Court may order a new trial; it is not imperative. I am of opinion, that it was open to the Small Cause Court to lay down certain conditions under which alone it would exercise the jurisdiction conferred by that section. If, therefore, the Small Cause Court had framed the rule under which this application of the petitioner was rejected, it would, apparently, be a valid rule. But the rule was made, not by the Small Cause Court, but by the High Court, and the question is, whether it is open to the High Court to cut down the jurisdiction of the Small Cause Court. The rule is said to have been framed by the High Court, “by virtue of the powers conferred by the Presidency Small Cause Courts Act, 1882, and the Acts amending the said Act and of all other powers hereunto enabling.” If it is this Act itself that gives power to the High Court to frame rules, then, apparently, the High Court has no power to cut down the jurisdiction. The section in the Small Cause Courts Act under which these rules are framed, is apparently Section 9 of the Act. That section places the Small Cause Court under the jurisdiction of the High Court, for the exercise of the powers which are conferred upon it by the Letters Patent, by the Civil Procedure Code, the Legal Practitioners Act and 24 and 25 Victoria, Ch. 104, Section 105. Now, if that is the only section under which the High Court can frame these rules, then, as I have said before, I am disposed to think that the High Court had no jurisdiction to frame this rule.

    But apart from the Small Cause Courts Act, the High Court has certain powers over the Civil Courts in the Presidency, under the enactments and Letters Patent above referred to, and the rules are also said to have been framed under all other powers enabling the High Court to make the rules. Therefore the question arises, whether, apart from section 9 of the Small Cause Courts Act, the High Court had not the power under the other provisions of law to make the rule in question. This question has not been argued before us. Such power, if vested in the High Court under the above provisions of law cannot be taken away by implication. If the Indian Legislative Council is entitled to cut down the power of the High Court, then it must be done by express enactment and not by implication. I have also considered the question, whether the Small Cause Court, having acted under these rules or rules similar to these, framed under the same powers, from 1882 up to this date, may not have impliedly accepted the rules as their own. But I am not able to accept that suggestion. The mind of the Small Cause Court was never directed to that question and they never considered whether they had the right to accept or discard these rules. The question is one of great importance and affects the procedure of the Court and might affect the validity of numerous decisions. I, therefore, refer to a Full Bench the question, whether Order 41, Rule 2 of the Presidency Small Cause Court rules is ultra vires.

    Ayling, J:—I agree to the reference proposed by my learned brother.

    Mr. C. Krishnamachariar for Mr. K. Bhashyam for Petitioner:—

    The case came on for hearing before the Full Bench, constituted as above.

    O. 41, R. 2, of the Madras Small Cause Court Rules, framed by the High Court under section 9 of the Presidency Small Cause Courts Act is ultra vires as it abridges the right to apply for a New Trial, given by the Act. Reg. v. Bird. Needles, ex parte. Further the rule-making power of the High Court is only in respect of matters of practice and procedure and not in respect of the substantive right of appeal. Attorney-General v. Sillem. A condition to be fulfilled before the exercise of a right is not a matter of practice or procedure R v. Pawlet, Morgan v. Bowels and In re West Devon Great Consols Mine.

    Mr. P. M. Sivagnana Mudaliar for Respondent:—

    The rule in question is a very wholesome rule and has been in force for 30 years. Section 38 of the Presidency Small Cause Courts Act does not confer any right at all. Poyser v. Minors(6).

    OPINION

    Chief Justice:—The question which has been referred to us in this case is,—“Whether Order XLI, Rule 2 of the Presidency Small Cause Court Rules is ultra vires.” The rule provides that no application for a new trial shall be entertained unless the applicant at the time of presenting the application either deposits in Court the amount due from him under the decree or order, or gives security to the satisfaction of the Court or the Registrar for the performance of the decree or order in respect of which the application is made. The power to grant a new trial in a suit in the Presidency Small Cause Court is regulated by Section 38 which provides “where a suit is contested, the Small Cause Court may on the application of either party made within eight days from the date of the decree or order in the suit, order a new trial to be held, or alter, set aside or reverse the decree or order upon such terms as it thinks reasonable.” The Rules of the Presidency Small Cause Court are made under the powers conferred by Section 9 of the Presidency Small Cause Court Act of 1882. Under the Act as it originally stood, there was a power in the Small Cause Court itself, with the previous sanction of the High Court, to make rules. In 1895 that section was repealed and the power to make rules was given to the High Court. The terms of the section which empowers the High Court to make rules in reference to the Small Cause Court are very wide. The general rule is, no doubt, that stated in the case referred in the order of reference, Reg. v. Bird. Needles, ex parte, that is, “where a power to make regulations is given by a statute, no regulations made under the statute can abridge a right conferred by the statute itself.” That is the general rule. But if by statutory enactment a power is given to a rule-making authority to make rules, the rules, as it seems to me, if they were within the power given, would be good even if they purported to abridge the rights given by the statute.

    I think the only question we have to decide is, is this Rule within the powers conferred upon the High Court by the section which was introduced into the Act in 1895? Now, whatever may be the true construction of this section, one thing seems clear and that is, it only empowers the High Court to make rules with reference to matters of practice or procedure. It cannot, as it seems to me, be suggested that the terms of the section are wide enough to give this Court power to make rules with regard to matters of substantive right, or matters which are not practice or procedure. Then the question is,—can it be said that the right to apply for a new trial is a matter of practice or procedure? Section 38 which regulates this question of new trials is, perhaps, somewhat curiously worded. It does hot say in so many words that a party has the right to apply for a new trial, It says that “the Small Cause Court may, on the application of the party, order a new trial.” But I think on the true construction of the section it gives a right to a party to apply for a new trial.

    As regards the right of appeal, the right of appeal being a creature of that statute, I think it is well settled that a right of appeal is not a matter of practice or procedure. I may refer to certain observations made by Lord Westbury in a case to which our attention has been called, Attorney-General v. Sillem. The Lord Chancellor thus describes the right of appeal: he says “the right of appeal is the right of entering a superior Court and invoking its aid and interposition to redress the error of the Court below. It seems absurd to denominate this paramount right part of the practice of the inferior tribunal.” Our attention has also been called to a decision of the House of Lords, Colonial Sugar Refining Company v. Irving, in which there is an observation by Lord Mac-naughten:—“To deprive a suitor in a pending action of an appeal to a superior tribunal which belonged to him as of right is a very different thing from regulating procedure.” Now can we draw any distinction between a right of appeal conferred by statute and the right to apply for new trial? I think we cannot. Our attention has not been called to any case in which any such suggested distinction has been drawn, nor to any case in which it has been held that the right to apply for a new trial is a matter of practice or procedure. Of course, there is no objection to the Small Cause Court, if they think fit, making it one of the terms which they are entitled to impose when they make an order for a new trial, that the condition imposed by Order XLI, Rule 2, should be satisfied before they grant the application. But to say that the Small Cause Court has the power to do that is a very different thing from saying that the rule in question is a rule of practice or procedure and within the powers conferred by Section 9. The preamble to the Rules states that they are made “by virtue of the powers conferred by the Presidency Small Cause Courts Act of 1882……and of all other powers hereunto enabling, the High Court……” Our attention has not been called to any power in the High Court in this connection, outside the powers conferred by section 9 of the Presidency Small Cause Courts Act.

    One word with regard to the case of Morgan v. Bowles which was cited in argument in support of the contention that the rule is bad. I do not think that either this case or the case of In re West Devon Great Consols Mine, affords us any assistance with reference to the question as to whether the rule in question here is ultra vires or not Morgan v. Bowles had reference to a provision of an Act which imposed an obligation on a party appealing to give security for costs. Then certain rules were passed which did not reproduce this provision and it was held that the obligation to give security for costs under the Act continued. That case was decided upon the question of construction on the ground that the words of the rule did not abrogate the provision of the Act with reference to security for costs.

    In In re West Devon Great Consols Mine, Lord Bowen said with regard to this matter: “The rule ‘generalia non specialibus derogant’ applies” and he decided the question purely as one of construction. And Lord Justice Cotton in his judgment says: “Assuming, without deciding, that the Rule Committee had power to take away this condition with regard to the security for costs or with regard to the deposit, they had not purported to do so.”

    It seems to me, for the reasons I have stated, the answer to the question referred to us is that the rule is ultra vires.

    Sankaran Nair, J:—I agree that the rule is ultra vires.

    Oldfield, J:—I concur.

    Rule ultra vires.

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    Comments

    Madurai Pillai v. T. Muthu Chetty
    (Jan 6, 1914)