Doraisami Padayachi and Another vs Vaidyalinga Padayachi (dead) and Others

Wallis, C.J.—The answer to the Full Bench reference being against him, Mr. Kuppusami Aiyar for the appellant has relied on another of the

grounds taken here and in the lower Appellate Court, that time did not run between the 8th March, 1906 the date of the reference to arbitration

and 31st October 1910, when it is alleged the arbitration proceedings came to an end by the death of the arbitrator. Section 21 of the Specific

Relief Act provided that ""if any person who has made such a contract (to refer to arbitration) and has refused to perform it, sues in respect of any

subject which he has contracted to refer, the existence of such a contract shall bar the suit."" As to this I agree with Richards, J., one of the referring

Judges in Ram Kumar Singh v. Jagmohan Singh ILR (1910) A. 315 that the institution of a suit after the contract to refer is sufficient refusal to

perform such a contract to bar the suit under the section. The result of this provision when it was in force was, it seems to me, to bar the plaintiff''s

right to sue for dissolution of partnership so long as the arbitration had not broken down or the other side had not refused to go on with it. If the

arbitration had become impossible as by the death of the arbitrator or the other side had refused to go on with it, Section 21 would have ceased to

operate as a bar to the plaintiff. The question then is, what is the effect to be attributed to the removal of this statutory bar by the repeal of this

provision of Section 21 by Section 22 of the second schedule of the CPC of 1908. The effect of the provision while it was in force, was to confer

upon the other parties to the contract a right to have the question decided by arbitration and not by suit, and this was a substantive right of an

important character. This being so, the repeal of this provision of Section 21 by the CPC of 1908 did not affect the right of the other parties to the

contract which had accrued under it (General Clauses Act 1897, Section 6 (c),) and consequently if the plaintiff had brought the present suit

immediately on the coming into force of the Code he would still have been liable to be met by a plea founded on the repealed provision, and it was

only when by the death of the arbitrator in 1910 further proceedings in the arbitration became impossible that the plaintiff''s right to sue was

restored to him. It is I think clear that the special provision in Section 21 prevented time running against the plaintiffs under the Limitation Act while

it was in force and whether the effect of this provision was merely to suspend the running of time under the Limitation Act, or to take the case out

of the Article and bring it under Article 120, in either case, the suit would be within time. I may say however that I do not think that the Judicial

Committee should be considered in Nrityamoni Dassi v. Lakhan Chandra Sen ILR (1916) C. 660 to have departed from the view clearly

expressed in 17 CWN 605 (Privy Council) . We allow the appeal, reverse the decrees of the Lower Court and remand the case for disposal

according to law. Costs incurred hitherto to abide

Seshagiri Aiyar, J.

The points raised by Mr. Kuppusami Aiyar on this second occasion are by no means easy of solution. Upon one point my mind is clear. The

parties referred the matters in dispute to arbitration before the new CPC came into force. At that time the rights of the parties were regulated by

Section 21 of the Specific Belief Act. That section says that the existence of a contract to refer ""shall bar the suit."" Mr. Muthiah Mudaliar''s

ingenious argument that the bar affects only the agreement to refer and not a pending reference is obviously untenable. As I read the section a right

is, conferred on one of the parties to a contract to prevent the other from enforcing his rights other than through the tribunal chosen by the parties.

Such a right cannot be said to be a mere incident of processual law. It is well-established that a right of appeal granted under a repealed Act is not

affected by the new Act. Colonial Sugar. Refining. Co. v. Irving (1905) A.C. 369 Sadasiva Pillai v. Kalappa Mudaliar (1900) ILR 24 M. 39 and

Nana v. Sheku ILR (1908) B. 337. A vested right is not ordinarily taken away by a new Act. Gopeshwar Pal v. Jiban Chandra Chandra ILR

(1914) C. 1125. Applying these principles, it seems to me that Section 22 of the Second Schedule to the new CPC did not deprive the defendant

of the right which he had of objecting to the suit, the matter in dispute having been referred to arbitration. It follows from this that so long as the

arbitration was operative, the plaintiff was incapable of enforcing his rights in a Court of Law.

It is admitted that the proceedings were pending until October 1910 when the arbitrator died. In my opinion, the plaintiff was debarred from

seeking the assistance of the Court till then. It was next argued that a bare institution of a suit would not amount to ""a refusal to perform"" so as to

attract the provisions of Section 21 of the Specific Relief Act, and that as the plaintiff had always expressed his willingness to abide by the decision

of the arbitrator, the defendant never had any right to plead the bar of Section 21. In Ram Kumar Singh v. Jagmohan Singh ILR (1910) A. 315.

Mr. Justice Richards (as he then was) held in the judgment from which a Letters Patent Appeal was preferred, that the filing of a suit would amount

to refusal to perform, and Mr. Justice Tudball who differed from him expressed no opinion on this question. The learned Judges who heard the

Letters Patent Appeal did not question this dictum of Mr. Justice Richards. In my opinion the institution of a suit by the plaintiff would be an overt

act indicative of an intention not to perform the contract entered into by him

The head note to the decision in Tahal v. Bisheshar ILR (1885) A. 57 is somewhat too broadly expressed. The learned Judges based their

decision upon the view ""that the contract, the existence of which would bar a suit under the circumstances contemplated by this section, must be an

operative contract and not a contract broken up by the conduct of all the parties to it. ''''If there was no enforcible contract, the question of refusal

to perform could not have arisen. W. Crisp v. Adlard ILR (1896) C. 956 relied on by the learned vakil for the respondent has no application to

the present case. I am therefore of opinion that if the plaintiff had brought a suit before the arbitrator died, he could have been prevented from

enforcing his rights in the suit by virtue of the last clause of Section 21 of the Specific Relief Act

The further point whether the period during which the bar operated should be regarded as having been merely suspended or whether the cause

of action for the suit itself should be regarded as not having accrued until the death of the arbitrator is one on which there is room for considerable

difference of opinion. The suspension of the period is provided for by Sections 14 and 15 of the Limitation Act. I do not think that the present case

is covered by either of these sections. Ordinarily that would be a sufficient answer. But the Judicial Committee have recently (Nrityamoni Dassi v.

Lakhan Chandra Sen ILR (1916) C. 660 given their general adherence to the conclusion expressed in Lakhan Chandra Sen v. Madhusudan Sen

ILR (1907) C. 209. That decision seems to lay down that apart from the statute, a party who is prevented from enforcing his claim has a general

right that the period of his disability should not count against him, although the difficulties in his way may not be of the nature contemplated by

Sections 14 and 15 of the Limitation Act. An examination of the authorities relied on in Lakhan Chandra Sen v. Madhusudan Sen ILR (1907) C.

does not support the general proposition laid down therein; but the question must be taken to have been set at rest by the Privy Council by

their pronouncement in Nrity amoni Dad v. Lakhan Chandra Sen ILR (1916) C 660. Mr. Justice Ayling and myself recently followed Lakhan

Chandra Sen v. Madhusudan Sen ILR (1907) C. 209. in Appeal Against Order No. 354 of 1915. We have not then to consider whether there

was only a suspension of the period and not of the cause of action itself, as in any event, the plaintiff would have been in time. There is an earlier

decision of the Privy Council which seems to throw some doubt on this theory of the suspension of the cause of action. In 17 CWN 605 (Privy

Council) it was argued that the period during which there was a fusion of the interests of the mortgagor and of the mortgagee should be extended in

calculating the period allowed by Article 148. Their Lordships expressed the opinion that Section 9 of the Limitation Act was against the plea. It is

inferable from the judgment that the fusion created either an inability or disability to sue and that as Section 9 expressly enacted that time which had

once commenced to run should not be stopped by such a subsequent inability or disability, the period of the fusion of the rights should not be

excluded. It may be possible to distinguish Nrityamoni Dasi v. Lakhan Chandra Sen ILR (1916) C. 660 from the earlier case on the ground that

no question of inability or disability arose in the latter. But the extension of the principle contained in Nrityamoni Dasi v. Lakhan Chandra Sen ILR

(1916) C. 660 must be made with great caution. I think it would be more logical to hold that as a result of the interposition of the bar, Article 91 is

not applicable to the present case. In another case which was argued subsequently, I have stated my reasons for invoking the aid of the residuary

articles whenever a specific article in all its bearings is not applicable. Acting on that view, I am prepared to say that the residuary Article 120

applies to this case and that as the cause of action arose for the suit only on the death of the arbitrator in 1910--for as pointed out by the learned

Chief Justice, u/s 6(c) of the General Clauses Act the bar continued till then--the suit is within time.

The decree of the Court below must be reversed and the suit must be remanded for disposal on the merits. Costs to abide the result