Bandaru Kabbaiah vs Adapa Gopala Rao

A.V. Krishna Rao

C. R. P. 671/73 is filed against the order in I.A. 122/73. C.R.P. 672/73 is filed against I. A. 12/73. C.R.P. 673/73 is against I.A. 121/73. I.A. 122/73 was filed under Order 9. Rule 13 C.P.C. The 2nd defendant in the suit was the applicant and the petition was ordered after condoning the delay as prayed for in I.A. 121/73 in filing the application to set aside the exparte decree. I.A.No. 123/73 was filed for amendment of the judgment and decree passed by the lower Court u/s 152 C.P.C. The plaintiff is the petitioner in all these C.R.Ps. The facts necessary for disposal of these revision petitions may briefly be stated. The plaintiff filed O.S. 43/72 impleading defendants 1 and 2 seeking recovery of a sum of Rs. 70. 390/- inclusive of interest on a principal amount of Rs. 54,000/- Defendants 1 and 2 appeared by the same counsel and filed a written statement jointly. It was inter alia contended that the suit promissory note was executed by the 2nd defendant in the agency area and that the civil court had no jurisdiction to try the suit. It was also urged that the plaintiff was a regular moneylender and that as he did not hold a money-lending licence, the suit was liable to be dismissed. It was also argued that the promissory note was not supported by consideration. On these pleadings appropriate issues were framed and the suit stood posted for trial on 28-3-1973. On that date Sri S.S. Prakash Rao, Advocate appearing for defendants 1 and 2 had filed a memo into court on behalf of the 2nd defendant withdrawing the defence in the suit on behalf of the 2nd defendant. On the same day a memo was filed into court containing a joint endorsement signed by the 1st defendant and his advocate and by the plaintiff and his advocate. The joint endorsement was only filed on behalf of the 1st defendant it did not purport to have been filed on behalf of the 2nd defendant. As stated by me earlier, the defence on behalf of the 2nd defendant was withdrawn by reason of the memo filed by the counsel. The Court on 28-3-1973 recorded the evidence of P.W.1, the plaintiff, and also marked the suit promissory note and certain other documents. Judgment was delivered the next day i.e., 29th. As per the said judgment, the learned judge noted the fact of P.W.1, being examrned and Exs. A-1 to A-8 being marked. It was observed in the judgment as follows:--

Defendant 1 and plaintiff make joint endorsement. Counsel for plaintiff and defendant 1 are heard. In terms, of the joint endorsement made and the memo filed, the suit is decreed as hereunder.

The rest of the judgment went on to state that the plaintiff was entitled to recover a sum of Rs. 40,000/- together with interest thereon at 12% per annum. Defendants 1 and 2 were given liberty to re-pay the decretal amount in five equal annual instalments. The plaintiff was entitled to the institutional costs of the suit.

C.R.P. 673/73 is against the order condoning the delay in filing the application, I.A. 121/73. I see no grounds for interference with the order. I, therefore, dismiss C.R.P. 673/73, but in the circumstances there will be no order as to costs.

The 2nd defendant has filed I.A. 122/73 to set aside the judgment dated 29-3-1973 on the footing that it is an ex-parte decree, It was averred in the affidavit of the 2nd defendant filed in support of that petition that on 28-3-1973 when the suit was posted for trial, he was away at Hyderabad and could not appear in court, He urged that the memo filed by his Advocate withdrawing the defence only meant that his Advocate had withdrawn his vakalat. The reason urged was that his defence could not be withdrawn except under his signature. As he was absent on 28-3-1973, his advocate could only report no instructions but could not withdraw the defence. The vakalat given by him to the advocate did not authorise the advocate either to compromise the matter or withdraw the defence. It was further pointed out that in the decree neither the presence of the 2nd defendant nor his advocate''s presence as such was noted. For all these reasons, it wax urged that the decree is in effect an ex-parte decree. As the application admittedly was filed beyond time, a separate petition was filed to condone the delay. The lower Court on a consideration of the arguments before it came to the conclusion that the memo filed on behalf of the 2nd defendant withdrawing the defence had no legal effect and that therefore be should be deemed to be ex-parte on the date when the decree was passed. The plaintiff seeks to challenge the correctness of this view of the Court below.

It is urged by the learned counsel for the plaintiff-petitioner that Order 9. Rule 13 C.P.C. has no application at all to the case as the decree passed on 29-3-1973 is not an ex-parte decree. He elaborated his argument by submitting that an advocate in India has an inherent power to compromise the matter even though he is not so authorised expressly by the terms of the vakalat, that the same principle could be extended to the withdrawal of the defence by the advocate and that it cannot be said that it is a case of non-appearance on 28-3-1973 and that therefore Order 9, Rule 13 C.P.C. is not attracted. As this is not an ex-parte decree, submitted the council, the Court below erred in exercising its jurisdiction under Order 9, Rule 13 C.P.C. Order 9, Rule 13 C.P.C. enacts thus :

In any case in which a decree is passed ex-parte against a defendant, he may apply to the court by which the decree was passed for an order to set it aside ; and if he satisfies the court that the summons was not duly served or that he was prevented by any sufficient cause from appearing when the suit was called on for hearing, the Court shall make an order setting aside the decree as against him upon such terms as to costs, payment into court or otherwise as it thinks fit, and shall appoint a day for proceeding with the suit.

Provided that where the decree is of such a nature that it cannot be set aside as against such defendant only, it may be set aside as against all or any of the other defendants also.

It is manifest that unless the decree can be said to be an ex-parte decree, Order 9, Rule 13 is not attracted. What then is an ex-parte decree ? A decree can be said to have been passed ex-part only if the defendant did not appear when the suit was called on for hearing. On the facts of this case can it be said that the 2nd defendant had not appeared on 28-3-1973 ? It is true that physically he was not present on 28-3-1973, but his advocate was present in Court. He had filed a memo into court withdrawing the defence on behalf of the 2nd defendant. It may also be noted that the same advocate appeared and filed the written statement raising a common contest on behalf of both the defendants. That leads us to the question as to what is the meaning of ''appearance''. Whether it be a plaintiff or a defendant he shall be deemed to have appeared on the day fixed for hearing of the suit if he appears (1) either in person, or (2) by a pleader duly instructed by him. On 28-3-1973 admittedly in filing the memo the advocate bad purported to act on behalf of the 2nd defendant. It is not a case where he has reported no instructions because of the non-appearance of the 2nd defendant. He was exercising the authority which was conferred upon him by virtue of Order 3. Rule 4 C.P.C. He was conducting a joint defence on behalf of defendants 1 and 2. The 1st defendant had agreed to a decree in terms of the joint endorsement signed by him and his advocate and agreed to by the plaintiff and his advocate. When the 2nd defendant''s advocate bled the memo, there is no need to presume that he filed the memo without instructions in that behalf from the 2nd defendant. The 2nd defendant has not let in any evidence in this case that he had not so authorised his advocate. Under Or. 3 Rule 4(2) C.P.C. which relates to the appointment of a pleader, "every such appointment shall be filed in court and shall be deemed to be in force until determined with the leave of the court by a document subscribed with his signature in his own hand by the client or pleader, as the case may be, and filed in Court, or until the client or the pleader dies, or until all proceedings in the suit are ended so far as regards the client". So on 28-3-1973 it cannot be said that the appointment of the Advocate on behalf of the 2nd defendant was in any way terminated according to law. He had the right and the competence to act on behalf of the 2nd defendant. He purported to act on behalf of the 2nd defendant by filing the memo. It could hardly be said that there was on appearance on behalf of the 2nd defendant on that day. The vakalat which was given in the suit continued until the suit came to a termination the next day, i.e., 29-3-1973.

It becomes necessary to consider the powers of an advocate where the vakalat does not specifically authorise him to withdraw the defence of his client or where it is the case of the plaintiff that the vakalat does not authorise the advocate expressly to withdraw his case. The question of the competence of an advocate to compromise a suit has been the subject-matter of consideration in numerous decisions. No case has been brought to my notice which is a direct authority on the question for consideration before roe viz., whether an advocate has authority to withdraw the defence on behalf of the defendant for whom he has entered appearance. But the reported decisions do tender some assistance in answering the question. In Muthiah Vs. Karuppan 1927 Mad 852 at 858, 859 Kumaraswami Sastri, J, on a discussion of the relevant authorities deduced six propositions. They are :

A counsel has authority to make admissions in Court on behalf of his client on matters of fact relevant to the issues in the case in which he is engaged. Admissions on questions of law would not bind the client.

A counsel has authority to confess judgment, withdraw or compromise or refer to arbitration the suit in which he is instructed if his doing so is for his client''s advantage or benefit even though he has no express authority from his client.

A counsel cannot without express authority agree to compromise or refer to arbitration matters unconnected with the subject-matter of the suit in which he is instructed.

Where, in the course of a suit, a counsel makes an admission as to a collateral matter, or gives up a doubtful claim which is not a subject-matter of the suit there is a presumption that the counsel acts under instructions if the admission or the giving up of the doubtful claim is for the benefit of the client.

It is a question of fact in each case whether the counsel acts under instructions when he compromises or refers to arbitration matters not involved in the suit and the court on a consideration of the probabilities and the circumstances of the case can find that the counsel acted on instruction even though there is no direct evidence on the point.

A counsel has no power to make an admission or compromise or refer to arbitration a suit if he is instructed not to do so, with express authority from his client.

Proposition No. 2 is relevant in the present context. In that proposition it is stated that a counsel has authority to confess judgement, to withdraw the suit or even to compromise the same if he considers that it is to his client''s advantage or benefit even though he has no express authority in that behalf. In the instant case the vakalat, a copy of which is produced before me does not expressly authorise the counsel to withdraw the defence, but nevertheless on that day the other defendant, who raised a defence common to the 2nd defendant''s, had chosen to compromise the matter with the plaintiff in a particular matter, before the advocate appended his signature to the joint endorsement. I must presume that the advocate has applied his mind as to what were the best interests of his client viz., 1st defendant. If he had felt that it was in the best interests of the 1st defendant, what is wrong with his thinking that may be in the best interests of the 2nd defendant as well? Here it is not a case where simply there is one defendant and the defence was withdrawn by the counsel. The facts and circumstances enable one to think that the advocate before he filed the memo withdrawing the defence on behalf of the 2nd defendant must have applied his mind and must have come to the conclusion that the same decree which would be passed by reason of the joint endorsement as against the 1st defendant would prove beneficial to the 2nd defendant as well. The 2nd defendant had not examined the advocate and had not in any other way sought to prove whether he had expressly prohibited the advocate from dealing on his behalf in any particular manner. In the absence of such an express prohibition I should think that the advocate had the implied authority to act on what he considered the best interests of his client. There was no reason to apprehend so far as the advocate was concerned that the 1st defendant was acting in any way detrimental to his own interests and therefore detrimental to the interests of the 2nd defendant.

Let me now assume that an advocate had not the authority to withdraw the defence of his client but does it make a decree that was passed later an ex-parte decree. I should think that on 28-3-1973 there was appearance on behalf of the 2nd defendant and once there is appearance on his behalf it cannot be said that the decree that came to be passed the next day is an ex-parte decree. Looking at the matter from any angle I am of the view that the decree dated 29-3-1973 is not an ex-parte decree. The remedy of the 2nd defendant, if any, was to seek either of review of the judgment or go up in appeal against the decree but not to apply under Order 9, Rule 13 as the decree passed in question cannot be characterised as an ex-parte decree. If the decree is not an ex-parte decree, the Court below did not have any jurisdiction to set aside the judgement. The order of the lower Court made in I. A. 122/73 is therefore set aside and C.R.P. 671/73 is allowed. In the light of my above judgment, C.R.P. 672/73 has to be allowed and I need not deal with the merits of this application separately. The petitioner will be entitled to costs only in C.R.P. No. 671/73.