LexBYRAM PESTONFL GARIWALA versus UNION BANK OF INDIA AND ORS.
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BYRAM PESTONfl GARIWALA A v. UNION BANK OF INDIA AND ORS. ~· SEPTEMBER 20, 1991 [T.K. THOMMEN AND R.M. SAHAI, JJ.] B Code of Civil Procedure, 1908--0rder XXlll, Rule 3-Compromise -counsel's rol~ and Post 1976 CPC Amendment-Object of amend- ment-Legislative intention indicated. Code of Civil Procedure,1908-0rder XX/II read with Order XX/, Rule c 22--Compromise entered into by the Counsel of defendant in High. Court-- Compromise decree on 18.6.1984-Ex.ecution-Notice under Order XX!, Rule 22 to defendant made absolute on 23.1.199o-Questioning the com- promise after six years by chamber summon-- Effect of. Before this Court, the appellant-defendant challenged the judgment D _of the High Court which held that the decree made against the defendant ~ in terms of a compromise in writing and signed by the counsel representing the parties was valid and binding on the parties, arid that in the absence of any challenge against the order made under Order XX.I, rule 23, Civil Procedure Code, allowing execution of the decree, the E defendant was no longer entitled to resist executio~ by recourse to Chamber Summons. """' The appellant contended that the High Court was wrong in holding ..( that, notwithstanding the amendment of 1976 inserting the words 'in writing and signed by the parties', it was still sufficient if the terms of F compromise were reduced to writing and signed by counsel representing the parties, and not necessarily by the parties in person, and that a decree based on a compromise not signed by the parties in person was a nullity and was incapable of execution. The respondents submitted that it was always understood that the G expression 'party' included his pleader in matters relating to appearance in ' ..(- court, and his counsel in the cause, therefore, had express or implied authority, unless specifically withdrawn or limited by the party, to represent him in court and do whatever was necessary in connection with the conduct of bis suit including adjustment of the suit by agreement or compromises. H 187 - 188 SUPREME COURT REPORTS (1991) SUPP. 1 S. C.R. A Dismissing the appeal, this Court, HELD: 1. Counsel's role in entering into a compromise has been traditionally understood to be confined to matters within the scope of the suit. H~ver, a compromise decree may incorporate not only matters falling within the subject matter of the suit, but also other matters which B are collateral to it. The position before the amendment in 1976 was that, in respect of the former, the decree was executable, but in respect of the latter, it was not executable, though admissible as judicial evidence of its· contents. (199 C-D] C 2. After the amendment or 1976, a consent decree, is executable in terms thereof, even if it comprehends matters falling outside the subject-matter of the suit, but concerning the parties. [201 E] 3. The object or the amendment of Order XXIII, Rule 3, C.P.C. was to provide an appropriate remedy to expedite proceedings in Court. That D object must be borne in mind by adopting a purposive construction or the amended provisions. The legislative intention being the speedy disposal or . cases with a view to relieving the litigants and the Courts alike of the burden of mounting anears, the word 'parties' must be so construed as to yield a beneficent result, so as to eliminate the mischief the legislature had E in mind. [202 D-EJ 4. There is no reason to assume that the legislature intended to curtail the implied authority of counsel, engaged in the thick of proceedings in court, to compromise or agree on matters relating to the parties, even if such matters exceed the subject matter or the suit. The relationship of counsel and F his party or the recognised agent and his principal is a matter of contract; and with the freedom or contract generally, the legislature does not interfere except when warranted by public policy, and the legislative intent is expressly made manifest. There is no such declaration or policy 0r indication of intent in the present case. The legislature has not evinced any intention to change the G well recognised and universally acclaimed common law tradition of an ever alert, independent and active Bar with freedom to manoeuvre with fon:e and drive for quick action in a battle or wits typical or the adversarial system of oral hearing which is in sharp contrast to the inquisitorial traditions of the 'civil law'or Fr
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