Report No. 3
63. The existence of so many Articles in the Limitation Act has undoubtedly made the subject very complex and has also been responsible for conflict of judicial decisions. All this can be avoided, firstly, by classifying the Articles on a rational basis and secondly, by prescribing a uniform period of limitation for suits or proceedings of the same nature. It is, of course, not quite easy to classify the Articles of the Act in water-tight compartments but a broad categorisation should be attempted if simplification is to be achieved. In the present Act, the Articles are grouped according to the periods prescribed.
This is neither rational nor convenient. A proper approach would be to adopt the subject-matter as the basis of classification. A perusal of the Articles relating to suits reveals that most of them fall under distinct subjects. If the Articles are grouped subject-wise and a uniform period is fixed for suits of the same nature we would have achieved a considerable measure of simplicity. Similarly, as regards Articles relating to appeals and applications, it would conduce to simplicity if uniform periods are prescribed as far as possible.
64. Taking as an illustration the Articles relating to suits on contract and tort, it will be found that they account for as many as 81 of the 149 Articles relating to suits. If, therefore, adopting the English model a single provision is made for all such suits with a period of three years from the date of the accrual of the cause of action, we would be able to eliminate as many as 80 Articles. The most important point to consider in this connection is whether the existing entries in column 3 of the first schedule to the Limitation Act, i.e., the dates of the starting point for limitation admit of such treatment.
In this connection, it is necessary to bear in mind that the Limitation Act is not a statute which creates a cause of action or confers a right of suit; these are matters which are governed solely by the substantive law. It is not, therefore, permissible in a statute of limitation to provide a starting point for limitation which does not correspond, with the date of the accrual of the cause of action under the substantive law. We, therefore, propose that all Articles in which the date in column three coincides with the accrual of the cause of action should be grouped together and the date of the accrual of the cause of action be specified as the starting point of limitation. Where, however, the two dates do not coincide, the existing Article should be retained with such changes as may be necessary.
65. At the outset it is necessary to consider what is meant by the term "cause of action." The principles for determining when the cause of action arises in any particular case of contract or tort have been fairly well settled in England and in India. The expression "cause of action" has been defined by Viscount Dunedin (Vide Board of Trade v. Cayzer Irvine Co., Ltd., 1927 AC 610 (617) as meaning "that which makes action possible." In the leading case of Read v. Brown, (1888) 22 QBD 128 Lord Esher defined it as:
"Every fact which would be necessary for the plaintiff to prove if traversed in order to support his right to the judgment of the court. There must be a plaintiff who can succeed and defendant against whom he can succeed."
(See also Reeves v. Butcher, (1891) 2 QBD 509; and Coburn v. College, (1897) 1 QBD 702)
The courts in India have adopted the above definition e.g., A Brault v. Kau, 60 Cal 918 It is best to adopt an objective test rather than enact a definition. It must be left to the courts to determine what constitutes the cause of action in each case applying well established principles to proved facts.
66. A question may be raised whether the removal of the detailed entries in the first schedule of the present Act, is not likely to open up fresh avenues of litigation. It may however be pointed out that under the Code of Civil Procedure the Court is under a duty to determine whether the plaint discloses a cause of action and if so, the place at which such cause of action arose to sustain its jurisdiction to entertain the suit. Further, what constitutes the cause of action for the several categories of suits has already been settled by the substantive law and it will not therefore be difficult for the Court, which has thus necessarily to go into the question of the cause of action, to determine .the date of its accrual by applying these settled principles of law. It .seems to us, therefore, that the apprehension that the alteration in the law would give rise to new controversies is not justified.
67. We may also refer to one other aspect of the matter which may be raised as an objection to our proposals. In the process of evolving a uniform period of limitation for suits of the same nature; it is necessary to increase the existing periods in some cases. This is inevitable, if a uniform period is to be prescribed for suits of the same nature. As pointed out above, such uniformity will put an end to the ever arising conflicts under the existing law. Further an increase in the existing period is not likely to work any hardship as it does not prevent the plaintiff from filing a suit on any earlier date if he so desires.
68. The Articles in the Act fall under three divisions, viz., (i) Suits (ii) Appeals & (iii) Applications. The Articles relating to suits can be grouped under:
I. Suits relating to contract and tort;
II. Suits relating to movable property;
III. Suits relating to trusts and trust property;
IV. Suits relating to immovable property, including
(a) Suits relating to Mortgages and charges, and
(b) Recovery of possession;
V. Suits based on other claims i.e. suits:
(a) for accounts,
(b) for declaration,
(c) for setting aside instruments,
(d) for relief on the ground of fraud and mistake;
VI. Residuary Article, providing for suits which do not fall under the above descriptions.
We proceed to examine the Articles on the basis of the above classification.