IN THE SUPREME COURT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA

1. Rajapaksha Mudiyanselage Jayathilaka Rajapaksha, 2. Risanga Nelka Riyensi Rajapaksha, Both of “Jayamani” Kehelwathugoda, Dewalegama.

Petitioners SC APPEAL NO: SC/APPEAL/83/2021 SC LA NO: SC/HCCA/LA/356/2020 HCCA KEGALLE NO: SP/HCCA/KAG/31/2019 (F)

DC KEGALLE NO: 8106/SPL Vs.

1. Mallawa Waduge Samantha, No. 167/12, Udambewatta, Olagama, Kegalle.

2. Maggoma Ralalage Upali Jayawansha, No. 08, Dharmapala Mawatha, Kegalle.

Respondents AND BETWEEN Maggoma Ralalage Upali Jayawansha, No. 08, Dharmapala Mawatha, Kegalle.

2^nd Respondent-Appellant Vs.

1. Rajapaksha Mudiyanselage Jayathilaka Rajapaksha, 2. Risanga Nelka Riyensi Rajapaksha, Both of “Jayamani”

Kehelwathugoda.

Dewalegama.

Petitioner-Respondents Mallawa Waduge Samantha, No. 167/12, Udambewatte, Olagama, Kegalle.

1^st Respondent-Respondent AND NOW BETWEEN Maggoma Ralalage Upali Jayawansha, No. 08, Dharmapala Mawatha, Kegalle.

2^nd Respondent-Appellant-Appellant Vs.

1. Rajapakshe Mudiyanselage Jayathilaka Rajapaksha, 2. Risanga Nelka Riyensi Rajapaksha, Both of “Jayamani”

Kehelwathugoda, Dewalegama.

Petitioner-Respondent-Respondents Mallawa Waduge Samantha, No. 167/12, Udambewatte, Olagama, Kegalle.

1st Respondent-Respondent-Respondent Before: P. Padman Surasena, J.

Mahinda Samayawardhena, J.

Arjuna Obeyesekere, J.

Counsel: Sudarshani Cooray for the 2nd Respondent-Appellant-

Appellant.

Erusha Kalidasa for the Petitioner-Respondent-

Respondents.

Argued on: 21.02.2022 Written submissions:

by the 2nd Respondent-Appellant-Appellant on 10.01.2022.

by the Petitioner-Respondent-Respondents on 05.05.2022.

Decided on: 19.07.2023 Samayawardhena, J.

In accordance with the written settlement dated 07.12.2010, the dispute was settled before the Debt Conciliation Board between the 2^nd respondent-appellant (appellant) as the creditor and the two petitioners- respondents (respondents) as the debtors, in terms of which the respondents agreed to pay Rs. 900,000 to the appellants on or before 06.06.2011 in order for the appellant to retransfer the property to the respondents. This did not happen.

The respondents filed action against the appellant in the District Court (more than five years after that date) on 08.09.2016 under summary procedure in terms of section 43(1) of the Debt Conciliation Ordinance, No. 39 of 1941, as amended, seeking enforcement of the settlement. One of the objections taken up by the appellant creditor against the maintainability of the action was that the respondent debtors cannot file action in the District Court under section 43(1) of the Debt Conciliation Ordinance as that section can only be invoked by a creditor, not by a debtor.

Both the District Court and the High Court overruled this objection and granted relief to the respondents. The High Court stated that the term “creditor” in section 43(1) could include “debtor” as well. This Court granted leave to appeal on the question whether the High Court erred in law by interpreting section 43(1) of the Debt Conciliation Ordinance in that manner.

Section 43 of the Debt Conciliation Ordinance reads as follows:

43(1). Where the debtor fails to comply with the terms of any settlement under this Ordinance, any creditor may, except in a case where a deed or instrument has been executed in accordance with the provisions of section 34 for the purpose of giving effect to those terms of that settlement, apply to a court of competent jurisdiction, at any time after the expiry of three months from the date on which such settlement was countersigned by the Chairman of the Board, that a certified copy of such settlement be filed in court and that a decree be entered in his favour in terms of such settlement. The application shall be by petition in the way of summary procedure, and the parties to the settlement, other than the petitioner shall be named respondents, and the petitioner shall aver in the petition that the debtor has failed to comply with the terms of the settlement.

(2) If the cour