Payyavula Vengamma Vs. Payyavula
Kesanna & Ors  INSC 51 (29 October 1952)
BHAGWATI, NATWARLAL H.
AIYAR, N. CHANDRASEKHARA
CITATION: 1953 AIR 21 1953 SCR 119
CITATOR INFO :
R 1990 SC1426 (22)
Arbitration--Arbitrator taking statement from
one party in the absence of the other-Legal misconduct-Validity of award-
Question of prejudice,
Where, in an arbitration under s. 21 of the
Indian Arbitration Act, the arbitrator took statements from each of the parties
in the absence of the other and made an award:
Held, that it is one of the elementary
principles of the administration of justice, whether by courts or by
arbitration by lawyers or merchants, that a party should not be allowed to use
any means whatsoever to influence 120 the mind of the judge or arbitrator,
which means, are not known to and capable of being met and resisted by the
other party; the arbitrator was accordingly guilty of legal misconduct; and
this was sufficient to vitiate the award, irrespective of the fact whether this
misconduct bad caused prejudice to any one.
Harvey v. Shelton (1844) 7 Beav. 455, Ganesh
Narayan Singh v. Malida Koer (1911) 13 Cal. L.J. 399, and Haigh v.
Haigh (1861) 31 L.J. Ch. 420, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 37 of 1952.
Appeal from the Judgment and Decree dated the
24th September, 1948, of the High Court of Judicature at Madras (Menon and
Mack, JJ.) in A.A.O.No. 688 of. 1945 arising out of Judgment and Decree dated
the 1st October 1945 of the Court of the' District Judge of Anantapur in
Original Petition No. 15 of 1945.
D. Munikanniah (J. B. Dadachandji" with
him) for the appellant.
S. P. Sinha(M. O. Chinnappa Reddi and K. B.
Chowdhury with him) for the respondents.
1952. October 29. The Judment of the Court
was delivered by BHAGWATI J.-The plaintiff filed 0. P. No. 15 of 1945 in the
Court of the District Judge of Anantapur for setting aside an award the ground
inter alia of legal misconduct of the arbitrator. The trial Court set aside the
award. The High Court appeal reversed the judgment of the trial Court and
dismissed the plaintiffs suit. This appeal has-been filed by the plaintiff with
the certificate of the High Court against that decision.
One P.Narayanappa died in 1927 leaving him
surviving the plaintiff his widow, the defendant I his undivided brother, the
defendant 2 a son -of his another pre-deceased brother, and defedant 3 his son
by his pre- deceased wife. 'The deceased had purported to make a will dated 1st
May, 1927 under which he had made certain provision -for her maintenance , and
residence, The plaintiff stayed with the family for 121 sometime but had to
leave the family house owing to disputes which arose between her and the senior
wife of defendant 1. She lived with her mother for eleven years and ultimately
filed a suit in forma pauperis 0. S. No. 19 of 1943 in the Court of the
District Judge of Anantapur, for maintenance, arrears of maintenance, residence
and household utensils as also recovery of some jewels and clothes as her
stridhanam properties. The defendants contested the claim of the plaintiff
contending that sufficient arrangement bad been made for her maintenance and
residence under the will dated the 1st May, 1927, that she had accordingly been
in possession and enjoyment of the property and that her claim was
unsustainable. The defendants also denied her claim for jewels and clothes.
The suit came for hearing and final disposal
before the Subordinate Judge of-Anantapur. When the plaintiff was being
examined as P.W. 1, in the suit the 27th February, 1945, all the parties filed
a petition under section 21 of the Arbitration Act agreeing to appoint Sri
Konakondla Rayalla Govindappa Garu as the 'sole arbitrator' for settling the
disputes in the suit and to abide by his decision, and asking the Court to send
the plaint, written statement and other records to the arbitrator for his
decision. A reference to arbitration was accordingly made by the Court. The
arbitrator entered upon the reference and the 6th March, 1945, examined the
plaintiff and got from her a statement which is Exhibit No. 4 in the record. He
similarly examined the defendant I the 10th March, 1945, and got from him the
statement which is Exhibit No. 5 in the record. After obtaining the two
statements, the arbitrator made and published his award the 12th March, 1945.
It was this award that was challenged by the plaintiff.
The legal misconduct which was alleged
against the arbitrator was that he examined each party in the absence of the
other. It was contended behalf of 122 the plaintiff that even though the
petition for reference to arbitration as also the statements Exhibits Nos. 4
& 5 authorised the arbitrator to settle the disputes according to law after
perusing the plaint and the written statements, the arbitrator examined
defendant I in the absence of the plaintiff and also perused what was called
the settlement of the 1st May, 1927, without giving an opportunity to the
plaintiff to have her say in the matter and was thus guilty of legal
misconduct. It was contended the other hand by the defendants that what was
done by the arbitrator was merely to obtain from the parties a reiteration of
their request contained in the petition that he should give his award the basis
of the pleadings, that not a single fact was recorded by the arbitrator from
the defendant 1 which did not find a place in his written statement and that
therefore the arbitrator was not guilty of legal misconduct.
The petition filed by the parties the 27th
February, 1915,did not give any special powers to the arbitrator. The
arbitrator was appointed for settling the disputes in the suit and the parties
agreed to abide by his decision. The plaint, the written, statement and the
other records were agreed to be sent to him for his decision, and if the
arbitrator was thus directed to make his award after perusing the plaint and
the written statements which were give to him by the Court along with the
order, we do not see why the arbitrator went to the plaintiff and defendant 1
and recorded their statements. The statement given by the plaintiff to the
arbitrator did not mention anything beyond the request that be should peruse
the plaint and written statement and give his decision according to law and
justice. The statement which was obtained from the defendant 1 however did not
merely repeat this request but contained several statements of facts, which did
not find a place in his written statement. These statements were as follows:-
(1)"She felt glad with what was given to her by her husband." 123
(2)"It is seen from the Government accounts that as per the settlement
made by her husband, the lands given to her have been in her possession."
(3)"Just like the plaintiff has her jewels in her possession, the other
females in the house have their jewels in their respective possession only. The
undivided family has no manner of right therein." and (4)
"Considering the domestic circumstances our elder brother provided
maintenance for the third wife, the plaintiff, just as he had provided
maintenance for his second wife." These statements constituted evidence
given by the defendant I in addition to the averments contained in his written
statement and it is futile for the defendant 1 to contend that in obtaining the
statement Exhibit No. 5 from him the arbitrator merely obtained from him a
narration of what was already found in his written statement:
This position is confirmed when one turns to
the award. The arbitrator stated that the Court had directed him to make the
award after perusing the plaint and the written statements of the plaintiff and
the defendants and that it had given him the plaint and the written statements
along with the order. He however proceeded to state that in pursuance of -the
order he took statements from the plaintiff as well as the defendant I who was
the manager of the defendant's family. He further stated that he bad perused
the settlement which the defendant 1 alleged as having been made Ist May, 1927,
in favour of the plaintiff and proceeded to award to the plaintiff 8 acres 17
cents of land bearing Survey No. 507 in addition to the 40 acres of land
already given by the deceased to her. It is clear from the terms of this award
that the arbitrator took into consideration not only the plaint and the written
statements of the parties but also the statement which he had obtained from the
defendant I and the will dated 1st May, 1927.
There is thus no doubt that the arbitrator
heard the defendant 1 in the absence of the, plaintiff. No 124 notice of this
hearing was given by the arbitrator to the plaintiff nor had she an opportunity
of having the evidence of the defendant I taken in her presence so that she
could suggest cross-examination or herself cross-examine the defendant I and
also be able to find evidence, if she could, that would meet and answer the
evidence given by the defendant 1. As was, observed by Lord Langdale M. R. in
Harvey v. Shelton(1), "It is so ordinary a principle in the administration
of justice, that no party to a cause can be allowed to use any means whatsoever
to influence the mind of the Judge, which means are not known to and capable of
being met and resisted by the, other party, that it is impossible, for a
moment, not to see, that this was an extremely indiscreet mode of proceeding,
to say the very least of it., It is contrary to every principle to allow of
such a thing, and I Wholly deny the difference which is alleged to exist
between mercantile arbitrations and legal arbitrations. The first principles of
justice must be equally applied in every case. Except in the few cases where
exceptions are unavoidable, both sides must be heard and each in the presence
of the other. In every case in which matters are litigated, you must attend to
the representations made both sides, and you must not, in the administration of
justice, in whatever form, whether in the regularly constituted Courts or in
arbitrations, whether before lawyers or merchants, permit one side to use means
of influencing the conduct and the decisions of the Judge, which means are not
known to the other side.
This case of Harvey v. Shelton(1) is the
leading case this point and it has been followed not only in England but in
India. (See Ganesh Narayan Singh v. Malida Koer(2). She had also no opportunity
to have her say in the matter of the settlement of the 1st May, 1927. The
course of proceeding adopted by the arbitrator was obviously contrary to the
principles of ,natural justice.
(i) (1844) 7 Beav 455 at P. 462.
(2) (1911) 13 c.L. J. 399 at pages 401, 402,
125 Shri S. P. Sinha however urged before us that no prejudice was caused to
the plaintiff by reason of the arbitrator having obtained the statement Exhibit
No. 5 from defendant 1 and that therefore the arbitrator was not guilty of
legal misconduct. This contention is unsound. The arbitrator may be a most
respectable man; but even so, his conduct cannot be reconciled to general
principles. "A Judge must not take upon himself to say, whether evidence
improperly admitted had or had not an effect upon his mind The award may have
done perfect justice: but upon general principles it cannot be supported."
Per Lord Eldon, Lord Chancellor, in Walker v. Frobisher(1).
To the same effect are the observations of
Lord Justice Knight Bruce in Haigh v. Haigh(1):
"It is true that he states in his
affidavit that he did not allow those explanations to influence him in -his
report upon the accounts, and I have no doubt he honestly intended this to be
the case; but it is impossible to gauge the influence which such statements
have upon the mind.
We must hold, without meaning the least
reflection the arbitrator, that he was guilty of legal misconduct and that was
sufficient to vitiate the award.
Shri S. P. Sinha then urged that the
plaintiff had waived her right if any to challenge the award the ground of
legal misconduct. No waiver however was pleaded by the defendant I and it was
not competent to him to urge this contention at this stage before us.
The result therefore is that the judgment of
the High Court cannot stand. We allow the appeal, set aside the judgment and
decree passed by the High Court and restore the judgment and decree passed by
the trial Court with costs throughout' Appeal allowed.
'Agent for the appellant: Naunit Lal.
Agent for the respondents M. S. K. Aiyangar, (i)
(18o1) 6 Ves. 7o at page 72.