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IN THE HIGH COURT OF KERALA AT ERNAKULAM
R. Narayana Pisharadi, J.
Mary Gomas and Ors. – Petitioners
Versus
Vaitus And Ors. – Respondents
OP(C).No.359 OF 2019
Decided On : 19-11-2020
he Legal Service Authorities Act- S.21 -An award passed by the Lok Adalat -Compromise or settlement between the plaintiff and one of the several defendants shall certainly be deemed to be a decree -Conclusively determines the rights of the plaintiff only as against the defendant who has signed it- Such an award does not completely dispose of the suit
Statement of facts:
The suit was for realisation of money. The case was referred to Lok Adalat. The plaintiff and the second defendant only appeared before the Lok Adalat. On the basis of the settlement of dispute between them, on 15.10.2010, the Lok Adalat passed Ext.P1 award
Finding of the court:
When the award passed by the Lok Adalat is not signed by all the parties to the suit, the suit is not finally or completely disposed of by such award. The trial court should have continued the proceedings in the suit as against the defendants who did not sign the award without being influenced in any manner by the terms of the award.
Result: Original petition allowed
Based on the provided legal document, the key points are as follows:
A partial compromise that is prejudicial to the interests of other parties who did not join the settlement cannot be recognized or enforced. When a suit involves multiple parties with inseparable interests or joint and indivisible subject matter, only compromises that involve all relevant parties are valid and enforceable (!) .
An award passed by a Lok Adalat, which is based on a settlement between only some of the parties, is deemed to be a decree only as far as the parties who signed it are concerned. Such an award does not fully dispose of the entire suit unless all parties to the dispute have signed or agreed to it (!) (!) .
The expression "all the parties to the dispute" in the relevant statutory provisions should be interpreted to mean only those parties who have signed or participated in the settlement or award. This prevents the award from being binding on parties who were not involved in the settlement process (!) (!) .
The language of the statute should be given its natural and grammatical meaning unless such an interpretation leads to absurd or unjust results. If the literal interpretation produces manifest injustice or absurdity, courts are justified in modifying the interpretation to align with the legislative intent (!) (!) .
The primary purpose of Lok Adalats is to facilitate speedy dispute resolution through consensual settlements. The awards are based on mutual compromise and are intended to be binding only on parties who have participated in and signed the settlement (!) (!) .
When a Lok Adalat award is not signed by all parties, it does not constitute a final or complete disposal of the suit. The court should continue proceedings against those who did not sign or participate in the settlement, without being influenced by the terms of an incomplete award (!) .
An application to set aside an order based on an award not signed by all parties, especially after a significant period, may be considered under appropriate legal provisions, such as Section 151 of the Civil Procedure Code. Such applications are subject to judicial discretion and procedural limitations (!) .
The court held that the order closing the suit based on an unsigned Lok Adalat award was not proper. The order was set aside, and the case was remanded for further consideration in accordance with law, emphasizing that the legal process must respect the signed agreements of all involved parties (!) .
An application under Section 151 of the Civil Procedure Code for setting aside an earlier order, made after a considerable delay, is subject to judicial scrutiny regarding its maintainability and the merits of the case (!) .
The application for impleadment by a third party was dismissed, and all other pending interlocutory applications were closed, indicating a focus on the core issues related to the enforceability of partial and unsigned settlements (!) .
These points highlight the importance of all parties' participation and signature in Lok Adalat awards and the necessity of adhering to procedural and substantive legal principles to ensure justice and fairness in dispute resolution.
JUDGMENT :
The petitioners are the plaintiffs and the respondents are the defendants in the suit O.S.No.466/2010 on the file of the Sub Court, Kollam.
2. The suit was for realisation of money. The case was referred to Lok Adalat. The plaintiff and the second defendant only appeared before the Lok Adalat. On the basis of the settlement of dispute between them, on 15.10.2010, the Lok Adalat passed Ext.P1 award in the following terms.
3. On 22.10.2010, the trial court passed the following order in the suit.
4. On 20.01.2018, the plaintiffs filed an application as I.A.No.80/2018 (Ext.P3) to set aside the order dated 22.10.2010 passed by the trial court by which it closed the suit and to proceed with the suit against defendants 1, 3 and 4.
5. On 10.12.2018, as per Ext.P4 order, the trial court dismissed Ext.P3 application.
6. The plaintiffs have filed this original petition under Article 227 of the Constitution of India challenging the legality and propriety of Ext.P4 order.
7. A third party has filed an application as I.A.No.3/2019 in the original petition to implead her as the additional fifth respondent.
8. The counsel for the contesting respondents did not appear at the time of hearing of the original petition. Heard learned counsel for the petitioners and also the third party.
9. The operative portion of Ext.P4 order reads as follows:
10. Neither the plaintiffs nor the defendants challenged the validity of Ext.P1 award in appropriate proceedings. Ext.P1 award of the Lok Adalat has become final.
11. Section 20(3) of the Legal Services Authorities Act, 1987 (for short 'the Act') provides that, where any case is referred to a Lok Adalat under sub-section (1), it shall proceed to dispose of the case and arrive at a compromise or settlement between the parties. Section 20(4) of the Act states that, every Lok Adalat shall, while determining any reference before it under the Act, act with utmost expedition to arrive at a compromise or settlement between the parties.
12. Section 21(1) of the Act provides that, every award of the Lok Adalat shall be deemed to be a decree of a Civil Court or order of any other Court. Section 21(2) of the Act states that, every award made by a Lok Adalat shall be final and binding on all the parties to the dispute, and no appeal shall lie to any Court against the award.
13. Clause (2) of Regulation 17 of the National Legal Services Authority (Lok Adalats) Regulations, 2009 provides that, when both parties sign or affix their thumb impression and the members of the Lok Adalat countersign it, it becomes an award. It further provides that, wherever the parties are represen
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