Andhra Pradesh High Court
Judges : N.KUMARAYYA, P.SATYANARAYANA RAJU
Veeravalli Perayya (died) - Appellant
Versus
Sukhavasi Chenchu Subba Rao - Respondent
Decided On : 06-08-60
ARBITRATION ACT - SECTION 17 - INTERPRETATION - JUDGMENT PRONOUNCED BEFORE EXPIRY OF STATUTORY PERIOD - IRREGULARITY - WAIVER OR CONSENT - JURISDICTION - MANDATORY OR DIRECTORY PROVISION - PUBLIC POLICY - PERSONAL BENEFIT OF LITIGANTS - CURE OF IRREGULARITY - CONSENT DECREE - ORDER 32, RULE 7 C. P. C. - GROSS NEGLIGENCE OF GUARDIAN - SECTIONS 31 TO 33 OF THE ACT - OVERRIDING EFFECT.
Fact of the Case:
Plaintiff, a minor, filed a suit to challenge the validity of a decree passed in terms of an arbitration award. The award was made in a suit filed by the plaintiff's next friend as the plaintiff was a minor at the time. The plaintiff alleged that the reference to arbitration and the award were not binding on him as he was not represented by a guardian ad litem and that the decree was passed before the expiry of the statutory period for setting aside the award.
Finding of the Court:
The court held that the reference to arbitration and the award were valid as the court had granted permission for the reference after due satisfaction and that the plaintiff was represented by a guardian ad litem. The court also held that the decree was not a nullity as the provision in Section 17 of the Arbitration Act requiring the court to wait for the expiry of the statutory period before pronouncing judgment was directory and not mandatory. The court further held that the plaintiff could not challenge the validity of the decree on the ground of gross negligence of his guardian as Sections 31 to 33 of the Arbitration Act provided a complete code for challenging the validity of an award.
Issues: 1. Whether the reference to arbitration and the award were valid? 2. Whether the decree passed in terms of the award was a nullity? 3. Whether the plaintiff could challenge the validity of the decree on the ground of gross negligence of his guardian?
Ratio Decidendi: 1. The reference to arbitration and the award were valid as the court had granted permission for the reference after due satisfaction and that the plaintiff was represented by a guardian ad litem. 2. The decree was not a nullity as the provision in Section 17 of the Arbitration Act requiring the court to wait for the expiry of the statutory period before pronouncing judgment was directory and not mandatory. The provision was intended for the personal benefit of the litigants and could be waived by them. In this case, the parties had waived the requirement by stating that they had no objection to the award. 3. The plaintiff could not challenge the validity of the decree on the ground of gross negligence of his guardian as Sections 31 to 33 of the Arbitration Act provided a complete code for challenging the validity of an award.
Final Decision: The appeal was allowed and the suit of the plaintiff was dismissed with costs.
( 2 ) BRIEFLY stated, the facts are; Plaintiff and defendant No. 21 are real brothers. Their father, Tatayya, died in 1934. Before long their mother also passed away. They had then an elder brother but he too died in 1944. Tatayya during his lifetime contracted debts. He on his own behalf and as guardian of his three minor sons in that connection eventually executed a usufructuary mortgage deed D/- 15-10-1930 in favour of defendants 17 to 20 in respect of the plaint A schedule properties for a sum of Rs. 6650. 00 found to be due from him. One of the terms of the deed was that it should be treated as an out and out sale if the property is not redeemed before 15-3-1932. After the death of Tatayya, defendants 17 to 20 on 15-5-1936 soldi their interest in the suit property to the 1st defendant for a sum of Rs. 1575. 00. The defendants 2 to 5 are the undivided sons of the 1st defendant. The other defendants are alienees of portions of plaint A schedule property from the 1st defendant. It is not necessary for the purpose of this appeal to set out in detail these alienations. Suffice it to say that the plaintiff now called in question these transactions as collusive and as such binding neither on the plaintiff nor on his brother, defendant No. 21. As the plaintiff and defendant No. 21 were orphans at the time and the person who looked after them was their sisters husband, Nannapaneni Veerayya, the said Veerayya brought a suit O. S. No. 48 of 1944 as the next friend of plaintiff and 21st defendant before the Sub Judge, Tenali for redemption of the mortgaged properties, its possession and rendition of accounts against the defendants as in the present suit. The suit was resisted inter alia on the ground that the father of the plaintiff, before he died, had, under an oral sale on 4-6-1934, sold his rignt of redemption for a sum of Rs. 75. 00 and which he admitted in his letter subsequently sent to the 1st defendant. During the course ot proceedings the matter at the instance of the parties was referred to an arbitrator of the parties choice. The petition for submission to arbitration (I. A. No. 1956 of 1945) was made by the parties on 24-9-1945. The plaintiff and the 21st defendant being minors, permission under Order 32, Rule 7 C. P. C. was applied for. This petition was accompanied by an affidavit duly sworn and the counsel appearing on behalf of the minors certified that in the circumstances of the case a reference to arbitration is beneficial to and is in the interest of the minors. The court, after due satisfaction granted leave to the minors to refer the matter to arbitration. The matter alone was referred to the arbitration on 24-9-1945. The award after due inquiry was made on 21-11-1945 by the arbitrator and it was filed into Court on 22-11-1945. The 21st defendant, the brother of the present plaintiff who was also plaintiff in that case had become major by that time. An application for declaring the 1st plaintiff (21st defendant) as major and to discharge the guardian was made on 18-11-1945 by his counsel. The alleged major too made an application to that effect personally. He was declared a major on 26-11-1945 and the guardian was discharged. He then stated to the court in person that he has no objection to the award. The plaintiffs next friend appeared in person and likewise said that he had no objection to the award. All the defendants also said that they had no objection. As all the parties had no objection, the court after due satisfa
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