AI Structured Summary
Not yet generated for this judgment
Judgment
This appeal is against a decree of the Lower Court confirming an award. The 1st defendant and Sriramulu, the husband of 2nd defendant were
brothers. It was alleged by the plaintiffs that 1st defendant''s father Venkayya brought his sister''s son Nagayya, the father of plaintiffs 1 to 3 into
the family as illatom son-in-law, promising him a share in the family property sanctioned by usage to a person in his position; that, when Sriramulu
died early in 1923, the plaintiffs claimed their share from the 1st defendant and the 2nd defendant also claimed maintenance, that these two
disputes were referred to arbitration, the arbitrators being P.Ws. 1 to 4 and D.W.I and that the arbitrators passed an award Ex. A. giving to the
plaintiffs a third share of the family property and to the 2nd defendant certain land for maintenance. The 1st defendant refused to carry out the first
part of the award and the plaintiffs sued to enforce it. The Lower Court passed a decree in their favour and the 1st defendant appeals. The 1st
defendant challenges the legal validity of the award on two main grounds: first, that the matter of the plaintiffs'' claim to a share in the family
property was never referred at all; and secondly, that the award is vitiated because the arbitrators have relied on their own personal knowledge
and not on evidence given before them for the decision of the case. We shall deal with these points in order.
The first point has to be decided on the terms of the reference which is Ex. B. It runs:
As first Nagayya, the father of one of us, Suryanarayana and later ray younger brother Anjayya were being kept in the house of the late Venkayya
for conducting the duties of the house and as the wife and heir of the late Sriramulu. the eider brother of one of us, Gopalam, had claimed proper
maintenance for her livelihood, etc., and so we are disputing about this affair, we both desire that you should act as panchayatdars and settle the
above disputes between us.
It is signed by the 1st plaintiff, the 2nd defendant and the 1st defendant. It is evident that the only matter mentioned in it as a claim of any kind is
the maintenance affair of the 2nd defendant. But the plaintiffs urge that the mention of Nagayya and Anjayya being kept in the house was made
because there was this other claim by the plaintiffs to a share and that, because of that mention of these facts the Court is to infer that the other
claim was not only advanced by them but was specifically referred for arbitration. It was also emphasised for the plaintiffs that the word ''disputes''
is in the plural and therefore there must have been more than one dispute. It is further urged that if Ex. B is obscure because of ambiguity, it is
permissible to take and consider extraneous evidence as to what was really referred; and the plaintiffs urge that that evidence is wholly in favour of
their interpretation of Ex. B. Now Ex. B is clear and quite intelligible as it stands. The fact that there is no very convincing reason appearing in it for
inserting the statement about the 1st plaintiff''s father and brother being kept in the house is not a ground for holding that the document considered
as a reference is obscure. Nor is a Court entitled to speculate as the Lower Court has done on what must have been the reasons for the insertion
of this statement. As to the use of the plural disputes,'' even if the plural was designedly usedand that is a considerable assumptionthe document
itself says that the 2nd defendant was claiming livelihood, etc., so that the plural may legitimately be used of her claims alone. It is difficult to believe
that if this was a deliberate document as it is claimed to be, setting out what were the disputes to be settled the statement of claim by the plaintiffs
for a share in the family property, which was the more important of the two claims should have been omitted altogether, if it really had been
referred, unless the omission was deliberately made with intent to deceive the 1st defendant who is an illiterate man.
We further think it is a case where the language used is plain in itself and applies accurately to existing facts. u/s 94 of the Indian Evidence Act
extraneous evidence cannot be given to show that it was not meant to apply to such facts. Even if the extraneous evidence is considered, it does
not seem to us to help the plaintiffs'' case. The arbitrators who were examined as witnesses 1 to 4 for the plaintiffs are agreed that all the parties
and themselves met before Ex. B was drawn up and agreed as to what were the disputes to be settled. It is said that both the claim of the plaintiffs
and that of the 2nd defendant were matters for settlement and they sat down and formally drew up a reference. It is not the plaint case that there
was any reference outside Ex. B of any dispute which Ex. B does not mention. It is their case that Ex. B covered everything that was referred to
arbitration. See paragraph 5 of the plaint. Now P.Ws. 1 to 4 all agree that it was not written in Ex. B that there was a dispute raised by the 1st
plaintiff for a share in the properties and none of them can explain why. ""We did not"" says P.W. 3, ""so clearly examine the wording of Ex. B.
There is therefore no evidence in support of the plaintiffs'' case that there is latent in Ex. B a claim by the plaintiffs for a share in the property. It
may of course be that the arbitrators genuinely thought that this other dispute had been referred to them; but that will not give them jurisdiction to
decide a matter not referred. Considering the language of Ex. B we are clear that it lay on the plaintiffs to show that Ex. B does contain a reference
of this claim to arbitration and that the 1st defendant put his mark on it with the knowledge that it did. We are unable to hold that the language of
Ex. B could in any way convey to him that 1 His other claim had also been referred to arbitration.
it is no: without significance that the plaintiffs have not examined the attestors or the writer of Ex. B. The arbitrators are no doubt good enough
witnesses in their own way, but they are not likely to put forward a view that a matter disposed of by them was not within their jurisdiction. The
evidence of the attestors and the writer would be that of more independent witnesses on this part of the case and it has not been put forward. It
may be remarked also that the 1st plaintiff himself has not gone into the box to speak to his case. This is important in view of the argument put
forward by him that there was no reason why he should have signed Ex. B if some claim of his had not been referred. He has not gone into the box
to teli us why he signed it and submit to cross-examination on the point. The defence suggestion is that he signed it in order to support the claim of
the 2nd defendant who is his own sister and a gosha woman.
The evidence of P.Ws. 1 to 4 is also further shaken by the fact that they do not agree as to whether the plaintiffs'' claim put forward just before
Ex. B was written was for himself only or for his family. There is nothing whatever in Ex. B to show that there was any dispute about the claim of
the plaintiffs'' whole family to a share. It is clear that even the arbitrators did not clearly realise the exact nature of the claim which, they now say,
was so clearly referred to them. Although the 1st defendant''s evidence in the Lower Court is not very satisfactory and he is obviously
endeavouring to improve his case by denying that Ex. B was read to him and maintaining that he was not present when it was drawn up, Ex. C-I
his statement before the arbitrators, only three days after Ex. B. makes it clear that to his knowledge the dispute that he had with the plaintiff was
as regards the maintenance claim. There is nothing in Ex. C-i to indicate that he was aware that Ex. B embodied a reference on any other point. As
we have already said, if all the parties at the time of writing Ex. B were agreed that there were two claims referred the more important being the
plaintiffs'' claim for a share of the family''s property, it is incredible that, while the second and less important claim is categorically put down, the
other and more important one should have been omitted. To our minds Ex. B only mentions one person who wants or claims anything and that is
the 2nd defendant, and we can see no good reason for holding that, when the 1st defendant put his mark to it, he was consenting to refer also the
matter of the claim of the plaintiffs to a share.
The principle on which such cases have to be decided is clear. Firstly, it must be clear that the dispute has been referred before the arbitrators
get jurisdiction to decide it. See In re Arbitration Act(Indian): Atlas Assurance Company, Ltd. v. Ahmedbhoy Habibbhoy ILR (1908) 34 Bom 1.
Courts no doubt will not be unreasonable or unduly technical in construing documents drawn up by persons not familiar with law and legal
phraseology: but at the same time the Court must be satisfied by the language used that a matter decided was in truth referred to the arbitrators for
decision. It does not matter whether or not the arbitrators genuinely believed the matter was referred and therefore hold an inquiry about it, if in
fact it was not, or that they genuinely believed that one of the parties had agreed to refer the matter if, as a matter of fact, he had not; and the final
decision as to whether the particular matter was referred or whether a particular party had consented to refer it lies not with the arbitrators but with
the Court. This is not a case in which the reference is wide enough to include in the matters referred the question whether or not this particular
dispute was within the submission. There is no wide language used at all, the language is restricted and definite. In such a case it is the Court which
has to decide whether the matter in respect of which the suit is brought is one which was agreed to be referred. For the above reasons we must
hold that this dispute about plaintiffs'' share was not referred and therefore the arbitrators did exceed their jurisdiction in deciding it.
As to point (2) namely, whether the arbitrators disposed of the case on personal knowledge, we think that also is a good ground of attack on
the award. It is clear from the evidence of P.Ws. 1, 2 and 3, all arbitrators, and from the wording of the award and the statement of reasons in the
award which: precedes the words ""Therefore we decide accordingly"" (that is, that the plaintiffs'' family should have a third share in the property),
that the decision of the arbitrators purports to have been based only on their personal knowledge. It is clear further from P.W. 3''s evidence that he
had no personal knowledge of these matters at all and that he merely accepted his knowledge from P.Ws. 1 and 2. Thus the award was passed on
the personal knowledge of P.Ws. 1 and 2 and the acquiescence of P.W. 3 in their opinion based on their personal knowledge. None of them
decided on the evidence and P.W. 3 decided on what P.Ws. 1 and 2 who wore not witnesses in the case told him. This procedure also vitiates the
award. It is true of course that personal knowledge does not of itself disqualify an arbitrator from acting as such and may even be a good reason
for his being selected; but, unless the parties expressly consent to such a course, no arbitrator has a right to decide the matter on his personal
knowledge. That knowledge may be of use in enabling him to understand and appreciate the evidence; but he is not entitled to use it to repudiate
the case put forward before him by any of the parties and. his decision must be on the evidence and not on his personal knowledge. Still less has
any arbitrator a right to accept and adopt as his own the purely personal knowledge of other arbitrators. Such a course was the more flagrant
misconduct in this case as the award was passed by a majority of one, the one being the arbitrator who took his knowledge at second hand not
from the witnesses but from his fellow arbitrators. That is, the decision was really only by two arbitrators and that on their personal knowledge
only.
It is clear that the award was not passed on a consideration of the evidence in the case and that is enough to vitiate it. See Chintalapudi
Sanyasirao, minor by next friend Venapalli Atchayya Vs. Chintalapudi Venkatrao, minor by guardian ad litem Chintalapudi Chinnayya, and the
cases quoted therein, R. Palavesam Chettiar Vs. Narayana Aiyar, and Lakshmi Narain v. Sheonath Pande ILR (1919) All 185. The case in
Ramdari Sahu v. Ram Charkter Safin ILR (1910) Cal. 143 relied on by the plaintiffs is not on all fours. The case in Maung Shwe Hpu and two v.
Umin Nyun ILR (1925) Rang 387 is relied on by the plaintiffs; but if that decision means that, where arbitrators have held a private enquiry of their
own, their award is not vitiated unless it can be shown that they have used the results of their enquiry in coming to their conclusiona matter
extremely difficult to prove, we are not prepared to agree. It would open a very wide door for misconduct and such a principle seems to us to be
opposed to the principle laid down in Dobson v. Groves (1844) 115 E.R. 239, which is that it is only by express agreement of parties that
arbitrators are entitled to decide a case on their own personal knowledge. Here there is no such agreement but rather one to the contrary since the
parties in Ex. D expressly declared therein their consent to the decision being based upon their statements alone.
in conclusion, therefore, the award, in so far as plaintiff in this suit seeks to enforce it is bad and cannot be supported and we reverse the
finding of the Lower Court on this issue(2). The award so far as it decides the question of 2nd defendant''s maintenance being not attacked will
stand. The other issues now fall to be tried and the suit is remanded to the Lower Court for this purpose. 1st defendant will get his costs in this
Appeal from the plaintiff. No costs to 2nd defendant.