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Judgment
Sadasiva Aiyar, J.—This is a reference from the Presidency Small Cause Court made u/s 69 of the Presidency Small Cause Courts Act.
Section 69(1) says that ""if two or more Judges of the Small Cause Court sit together in any suit and differ in their opinion as to any question of law,
the Small Cause Court shall draw up a statement of the facts of the case and the point on which there is a difference of opinion and refer such
statement with its full opinion on the point for the opinion of the High Court."" (2) ""When the Small Cause Court refers any question for the opinion
of the High Court as provided in Sub-section (1), it shall either reserve judgment or give judgment contingent upon such opinion.
The present reference is made by the Small Cause Court (of its own motion I take it), three Judges of the Small Cause Court, sitting together to
decide an application made by the plaintiff u/s 38 in a contested suit, having differed in their opinions on the two questions of law mentioned in the
referring statement. Mr. Osborne for the defendants has taken the preliminary objection that the reference is incompetent as the three learned
Judges could not be said to be sitting together in any suit (section 69) when hearing the application u/s 38 and that unless they first granted a ""new
trial"" and revived the suit, they could not ""sit"" in the suit so as to give them jurisdiction to make the reference to the High Court u/s 69 or to give
contingent judgments in so referring. In the present case, two of the three Judges gave judgments rejecting the application u/s 38, contingent on the
opinion of the High Court on the questions of law referred. I think that in order to deal with the argument properly, the scope of Section 38 has
first to be understood and I shall, therefore, proceed to consider the same.
Section 38 is one of the four Sections 37 to 40 in Chapter VI of the Presidency Small Cause Courts Act. That chapter is headed ''New Trials
and Appeals.'' Section 37 says: ""Save as otherwise provided by this chapter or by any other enactment for the time being in force, every decree
and order of the Small Cause Court in a suit shall be final and conclusive."" I take it that this means that unless an appeal or revision or a review is
provided for by any of the remaining Sections (38, 39 or 40 of the chapter) or by any other law (like the Charter Act), there shall be no such
appeal, review of a decree or order of the Presidency Small Cause Court. Again the phrase ""New Trials and Appeals"" seems to indicate that
appeals"" are different from ""New Trials"" and that a petition of appeal is a different petition from a petition for a new trial.
Section 38 says that ""Where a suit has been contested, the Small Cause Court may, on the application of either party...order a new trial to be
held, or alter, set aside or reverse the decree or order."" Is altering, setting aside and reversing a decree or order intended to be distinguished from
the ordering of a ""new trial"" to be held? I am inclined to hold that the section merely means that when and after a new trial is ordered, the Court in
such new trial could alter, set aside or reverse the decree or order first passed. The word ''or'' before ''alter'' should in my opinion, be ''and,'' Now
a Court of Appeal or Revision or a Court reviewing its judgment, when it accepts wholly or partially the petition of appeal, review of revision, if it
does not dismiss the petition wholly, alters or reverses the decision under appeal, review or revision.
As I said before, there are only 4 sections in Chapter VI headed ""New Trials and Appeals"" and even of these, I find that Sections 39 and 40
have nothing to do with ""New Trials"" or ""Appeals"", but only with removal of suits by a Judge of the High Court from the Small Cause Court to the
High Court. This phrase ''new trial'' which does not occur in the Civil Procedure Code, seems to be a legacy left by Section 53 of the very old Act
IX of 1850 (relating to the Presidency Small Cause Courts) and by Section 21 of Act XI of 1865 (relating to Mofussil Small Cause Courts). After
giving my best consideration to Section 38 I think that an application u/s 38 need not be confined to a prayer for the relief of a ''new trial'', but
might also include prayers for modifying or reversing the decree or order passed in the suit. The phrase ""new trial"" is more appropriate in countries
where trials are held with the help of a Jury. As said in a case referred to as Ishan Chunder Singh v. Haran Sirdar 11 W.R. 525 , ""the object of
new trials is to find facts."" It seems to me unfortunate that this expression employed in the loosely drawn Acts of the olden days should have been
thought so precious as to necessitate its retention up to date in the Presidency Small Cause Courts Act of 1882. Shephard, J., in Sadasook
Gambir Chund v. Kannayya 19 M.P 96 bases his judgment on this expression ""new trial,"" treats the finding of fact by a Small Cause Court Judge
as if it was the verdict of a Jury and then concludes by stating that on an application u/s 38 (Section 37 of Act XV of 1882 before its amendment in
1895) the Small Cause Court cannot interfere with the finding of fact of the Trial Judge unless the finding was such as no reasonable Jury ought to
have come to. Best, J., holds that as under Act XV of 1882, the Judges before whom an application u/s 38 of that Act is made can alter, set aside
and reverse the decree or order, they have got all the powers of an ordinary Appellate Court. Collins, C.J., shortly agrees with the reasons and
conclusions of Shephard, J. I am inclined to agree with Mr. Justice Best as regards the powers of the Small Cause Court on the application u/s 38,
though I do not intend to say that the Judge or Judges hearing and disposing of the application u/s 38 can be called a Court of Appeal. In Srinivasa
Charlu v. Balaji Rau 21 M.P 232, Collins, C.J., and Benson, J., follow Sadasook Gambir Chund v. Kannayya 19 M.L 96. The learned Judges
say that the change of the title of Chapter VI made by Act I of 1895 ""from New Trials and Re-hearing"" to ""New Trials and Appeals"" did not mean
that Section 38 gave appellate powers to the Judges to whom an application u/s 38 is made. They hold that the word ""appeal"" is mentioned in the
title of the chapter only in order to show that no appeal shall lie. In Bouvier''s Dictionary ""new trial"" is defined as a re-examination of an issue in fact
before a Court and a Jury which has been tried at least once before the same Court; a re-hearing of the legal rights of the parties and of the
disputed facts before another Jury granted by the Court on motion of the party dissatisfied with the result of the previous trial upon a proper case
being presented for the purpose. And it is said that such a new trial is held either upon the same or different or additional evidence before a new
Jury and probably but not necessarily before a different Judge. Then it is said that the usual grounds for a new trial are ""the not giving the defendant
sufficient notice of the time and place of trial,"" ""misconduct of parties, Counsel or witnesses,"" ""mistakes or omissions of officers in summoning and
drawing Jurors,"" ""disqualification of Jurors,"" ""the resort to indirect measures to prejudice the Jury,"" ""misconduct of the Jury,"" ""error of the Judge in
admitting illegal evidence,"" ""after-discovered testimony,"" ""excessive damages granted by the Jury"" and so on.
I should add that in Nagoor Meera Sahib v. Sookulal Sowcar 30 Ind. Cas. 488 : 2 L.W. 719 : 18 M.L.T. 254 : (1915) M.W.N. 907, I
concurred with Oldfield, J., in following Sadasook Gambir Chund v. Kannayya 19 M. 96 and Srinivasa Charlu v. Balaji Rau 21 M.P 232 which
decided that the jurisdiction u/s 38 is not of an appellate nature. On the further consideration which I have been able to give to the question in this
case, the conclusion that an application u/s 38 is not an application by way of appeal to an Appellate Court seems to me to be correct. The trial of
the case was by the Small Cause Court and it is to the same Small Cause Court that the application for the new trial is to be made and not to the
Superior Court (as it ordinarily is in the case of an appeal or revision). Though under the rules framed by the High Court u/s 9 of the Presidency
Small Cause Courts Act, the application u/s 38 is to be heard by a Bench of Judges not less than two including the Trial Judge (see Order XLI,
Rule 3), it cannot be argued that the High Court could not have framed the rule so as to empower the single Judge who tried the suit to hear and
dispose solely of the application u/s 38. I feel myself strengthened in the above view upon a consideration of the corresponding provisions in
another enactment which contained somewhat similar provisions as to ""new trial."" In the old Mofussil Small Cause Courts Act, XI of 1865, one
single Section (section 21) dealt with the setting aside of an ex parte decree (where a decree had been passed ex parte) and also with the granting
of a ""new trial"" (where the decree had not been passed ex parte). Section 13 of that Act provides only for a single Judge to be appointed in the
first instance for each Small Cause Court in the mofussil (unlike Section 8 of Act IX of 1850 and similar sections of the later Presidency Small
Cause Courts Act which empower the appointment of more than one Judge for a Presidency Small Cause Court). It is only as an exceptional case
and for a limited period that an additional Judge can be appointed u/s 15 of Act XI of 1865 for a Mofussil Small Cause Court. The application for
the setting aside of an ex parte decree or for a new trial u/s 21 of Act XI of 1865 can, therefore, be only to the single Judge who tried the suit (or
his successor), and it is clear that he cannot be called a Court of Appeal over himself though the application is, in a sense, an appeal to himself to
reconsider his own judgment. Act IX of 1887, Section 17(1), corresponding in part to Section 21 of Act XI of 1865, provides (among other
things) not for applications for ""new trials"" but for applications (for setting aside ex parte decrees and) for review of judgments, thus showing that
the application ""for new trial"" in the old Code corresponds closely to the application for ""review of judgments"" mentioned in Act IX of 1887. I am,
therefore, of opinion that an application u/s 38 of the Presidency Small Cause Courts Act is in the nature of a petition to the same Court to review
its judgment and not a memorandum of appeal to an Appellate Court. The absence of a provision in the rules or in Section 38 empowering two or
more Judges hearing an application u/s 38 to remand or to send back the case to the Trial Judge alone for conducting the ""newtrial""if granted, is
also in favour of the view that the application u/s 38 is, an application for review to the same Court and not a petition of appeal, the Court hearing
the application being intended to deal finally with the case on the review. I find that the notice issued to the other side on the application u/s 38 in
this case is ""to show cause why the suit should not be tried in Full Bench of the Court"", showing that the Full Bench is to finally re try it and dispose
of it.
As regards the point directly in question, Mr. Osborne relied on the decision in Oakshott v. British India Steam Navigation Co. 15 M.P 179. In
that case it was held that the words sitting in any suit"" in Section 69 presuppose that a suit is actually pending and if the application for a new trial is
rejected even by a conditional judgment of the majority, the suit was never pending before the Court and that no reference can be made and no
judgments contingent upon the opinion of the High Court can even be pronounced u/s 69, Clause 2, for the purpose of making any such reference,
till a ""new trial"" is first granted on the application u/s 38 so as to have the suit pending in the Small Cause Court. The learned Judges fortified their
opinion (as above) by the decision of the Calcutta High Court in Nusserwanjee v. Pursutum Doss 11 C.P 298 which follows an earlier case of Hall
v. Joakim 12 B.L.R. 34. With the greatest respect, I find myself unable to agree with the above decisions. The application u/s 38 is clearly made in
the suit itself. Though the majority of the contingent judgments given on an application u/s 38 would have the effect of rejecting the application, if
they come into force by reason of the opinion of the High Court agreeing with the opinion of that majority, they would so come into force only from
the date when the opinion of the High Court is so favourably pronounced. Till then, the application and the suit in which the application was made
must be deemed to continue to be pending. It cannot be denied that the suit and the application would be pending in the Small Cause Court if the
High Court disagreed with the Small Cause Court''s view. Why should they have ceased to be pending because there is the other contingency that
the High Court may agree with the opinion of the majority that the application should be rejected? I am inclined to respectfully follow the opinion of
Sir Barnes Peacock, C.J., in the case of Ishan Chunder Singh v. Haran Sirdar 11 W.R. 525 In that case it was contended that the Mofussil Small
Cause Court Judge had no power u/s 22 of Act XI of 1865 or Section 1 of Act X of 1867 (which supplemented Act XI of 1865) to make a
reference, as the question of law did not arise ""in the trial of the suit"" (section 22 of Act XI of 1865) or ""at any point in the proceedings previous to
the hearing of the suit"" (section 1, Act X of 1867). There the application was made to the Judge after the case had been heard and decided and it
was contended that the stage at which the application was made was not a stage previous to the hearing of the suit or a stage in the trial of any suit,
as a ""new trial"" had not been granted before the reference was made. The learned Judges, however, ruled that an application for a ""new trial"" under
the Mofussil Small Cause Courts Act (XI of 1865) was a ""point in the proceedings previous to the hearing of a suit within Section 1 of Act X of
1867"" and that the opinion of the High Court on the question of law arising on the hearing of such an application can be properly applied for by a
reference to the High Court. I do not see much difference between ""sitting in a suit in respect of a point in the proceedings previous to the hearing
of a suit"" and ""sitting in a suit."" If there is any difference, it is one which makes Sir Barnes Peacock''s opinion still more favourable to the applicant
u/s 38 of the Presidency Small Cause Courts Act; as the restriction ""in respect of a point previous to the hearing of the suit"" does not appear in that
section as it does in Section 1 of Act X of 1867. I find again that in Lodd Govindass Krishnadass v. Rukmani Bhai 21 Ind. Cas. 302 : 1 L.W. 529
: 38 M.P 438 : 4 M.L.T. 310 Miller and Sankaran Nair, JJ., held that when two or more Judges of the Small Cause Court sit together for the
purpose of exercising the jurisdiction conferred by Section 38 of the Presidency Small Cause Courts Act, they are sitting in a suit within the
meaning of those words in Section 69. In that case, however, the two Judges composing the Full Bench of the Small Cause Court were inclined by
their contingent judgments to reverse the Trial Judge''s view on the question of limitation, though they did not in so many words grant a ""new trial
on that ground before they made the reference. In the cases of Oakshoit v. British India Steam Navigation Co. 15 M.P 179 and Nusserwanjee v.
Pursutum Doss 11 C.P 298 the learned Judges seemed to think that the proper course for the judgment of the Small Cause Court was, before
giving their contingent judgments, to have formally granted a ""new trial"" and thus bring back the suit on the record so as to enable them to ""sit in"" it
and then to make the reference and then give their contingent judgments as to the proper decree to be passed in the suit. It seems to me that if the
words ""granting a new trial"" (as I apprehended) mean only the re-hearing of the case on review, it is taking too narrow and technical a view of the
scope of Section 69 to hold that the Judges sitting to hear such an application are not sitting in the suit till they pronounce some formal words to the
effect that they grant a ""new trial."" As Sir Barnes Peacock said in Ishan Chunder Singh v. Haran Sirdar 11 W.R. 525 : ""We must give a reasonable
construction to this Act, and we must give it with reference to the powers of the Small Cause Court. The Small Cause Court has power to grant a
new trial. If it had granted a new trial, there can be no doubt that the hearing on the new trial would have been a hearing within Act XI of 1865,
Section 22, and then the Judge might have asked our opinion on a point of law. If the hearing on a new trial would have been a hearing within the
meaning of Section 22 of the Act, the application for a new trial was a point in the proceedings previous to the hearing of the case. If we were to
hold that an application for a new trial was not a point in the proceedings previous to a hearing unless the application should result in a hearing, we
should compel the Judge to grant a new trial, in order that, upon the hearing under it he might ask the opinion of the Court on a point of law, which,
if we could have asked it on the application for a new trial, might save the necessity of granting it. It appears to me that we would be putting a very
restrictive meaning on the words of the Act, which was never intended, if we were to hold that the Judge could not ask our opinion on a question
of law upon an application for a ""new trial."" I am further of opinion that it must be held that a Rule nisi for a new trial is impliedly granted (Order
XLI, Rule 4) when notice is ordered to be issued to the opposite party on the application u/s 38, as Rule 4 says: ""If the Court, after hearing the
applicant or his Pleader, considers that there are grounds for the application it shall grant a Mule nisi for a new trial and shall direct notice to issue
to the other party."" If such a Rule nisi was granted, the suit was clearly revived and was pending and the contingent judgments have not yet
discharged that Rule nisi. Oakshott v. British India Steam Navigation Co. 15 M.P 179 followed Ralli Brothers v. Goculbhai Mulchund 15 B.P 376
and Hall v. Joakim 12 B.L.R. 34. But it seems to me with the greatest respect that the fact was overlooked in Oakshott v. British India Steam
Navigation Co. 15 M.P 179 that from the 15th August 1882 (see Fort St. George Gazette of that date, Part II, page 920) a rule passed by this
High Court has existed that a Rule nisi for a new trial has to be granted simultaneously with the granting of an order for notice to be issued to the
opposite party and before the application u/s 38 is finally heard and decided. 1 am, therefore, not prepared to follow the decision in Oakshott v.
British India Steam Navigation Co. 15 M.P 179. I think that the reference is competent, though no formal order was passed granting a new trial or
declaring that the suit has been revived before the notice was issued to the defendant on the application u/s 38. The preliminary objection is,
therefore, overruled.
Napier, J.
I regret to say that I find myself entirely at variance with the views expressed by some Judges of this Court as well as Judges of other High
Courts as to the construction of Chapter VI of the Presidency Small Cause Courts Act, XV of 1882. There must be, therefore, difficulties which I
have been unable to appreciate. I would simply construe the plain words of the chapter without reference to any previous enactment as I can find
nothing ambiguous in the language. Section 37 provides for the finality of the decisions of the Court except where special provisions are made.
Section 38 contains one of such provisions. It allows an application to be made to the Court within eight days from the date of the decree or order
in the suit. On that application the Court may do any one of four things. It may order a new trial to be held; it may alter the decree or order; it may
set aside the decree or order; it may reverse the decree or order. These powers are very nearly the same as those given to Appellate Courts in
appeals from inferior Courts u/s 107 of the Civil Procedure Code, namely, (a) to determine a case finally, (b) to remand a case, (c) to frame issues
and refer them for trial. There are no specific provisions for the exercise of the powers of appeal from the Original Side of the High Court by the
Appellate Side but these same powers have always been exercised. The English procedure empowers the Court of Appeal to grant a new trial as
well as to exercise its powers of reversing and altering. I am, therefore, unable to understand, why when the usual powers of an Appellate Court to
alter, set aside or reverse a decree are found in conjunction with a power to order a new trial, it should be held that these ordinary powers are only
to be exercised in or with an order granting a new trial. In my humble opinion the heading of the chapter expresses accurately the scope of the
section, ""New Trials and Appeals."" I am, therefore, of opinion that an Order or rule which limits the exercise by the Small Cause Court of its
jurisdiction u/s 38 to making orders, granting or refusing new trials and any Order or rule requiring parties to apply for a new trial is ultra vires.
The next point turns on the construction of the section under which the reference has been made. Section 69 provides as follows: If two or more
Judges of the Small Cause Court sit together in any suit, or in any proceeding under Chapter VII of this Act, and differ in their opinion as to any
question of law, etc., the Small Cause Court shall draw up a statement of the facts of the case, and the point on which there is a difference of
opinion and refer such statement with its own opinion for the opinion of the High Court, and shall either reserve judgment or give judgment
contingent upon such opinion."" It further provides that the High Court shall hear the reference as if it was a reference under the Code of Civil
Procedure, Order XLVI. It has been argued before us that, as the suit was dismissed and as the Small Cause Court did not make an order for a
new trial in this case, the Judges were not sitting together in a suit. I recognise that there is high authority for this contention. But I am unable to
agree with the view that when the suit has been dismissed, the Court can only make a reference when it orders a new trial contingent on the opinion
of the High Court. First, I am unable to appreciate the proposition that the question whether the Judges are sitting in a suit will depend on the result
of their decision. Secondly, I find it difficult to imagine a case where the Judges agree on a question of fact and yet order a new trial. A new trial
necessarily implies that evidence shall be taken again with possibly fresh evidence on some point on which evidence has been shut out by the Trial
Judge. It seems difficult to understand how in such a case the Judges can draw up a statement of the facts of the case prior to the new trial. Thirdly,
I do not understand how, if this view is correct, the Judges can refer if they have reserved judgment which they were permitted to do by the
language of the section. Lastly, I find it difficult to accept the view enunciated in one case, obviously to get over the difficulty, that the new trial is to
be held by the Bench itself on presumably the evidence taken in the first trial. I can only say that such a procedure is elsewhere unknown to law
and gives an entirely new meaning to the words ''trial.'' All these difficulties arise out of the use of the words ""sitting in any suit."" In my opinion there
is no difficulty in giving to these words a meaning which will make the procedure quite simple. The word suit'' is not defined in the Act. The section
does not use the language ''in the trial of the suit.'' Nor is it anywhere provided that a suit terminates when a decree has been given. Section 37
speaks of the decree being given in a suit and I read the language of Section 38 as specifically keeping the suit alive for eight days after decree for
the purpose of empowering the Court to exercise the appellate powers given to it by that section, There is in my mind, therefore, no difficulty in
holding that applications for new trial and for reversal of the decree are made in the suit and if that is so, all the difficulties disappear. If the suit is
not still in existence for the purposes of this chapter, I fail to see how effect can be given to the policy of the chapter. Obviously it was not intended
to apply to the stage of trial, for two or more Judges do not sit together in the trial of a suit. If, therefore, the plaintiff''s claim has been dismissed by
the decree and the suit does not continue for the purpose of this chapter, an unsuccessful plaintiff is deprived of the privilege of having a reference
by the Judges, though he can apply of a reversal u/s 38. I know of no principle on which an unsuccessful defendant should be given higher rights
than an unsuccessful plaintiff. In my view an application u/s 38 is rightly made, as it is in practice headed ""in the suit"" whether the claim has been
allowed or dismissed. It follows, therefore, that the Judges who have given judgments contingent upon such opinion have been sitting in the suit and
this preliminary objection fails.
The case coming on for final hearing, the Court delivered the following
Judgment
Sadasiva Aiyar, J.
This is a reference made by the Presidency Small Cause Court, Madras. We gave judgments yesterday overruling the preliminary objection
taken by Mr. Osborne, Counsel for the defendant.
As regards the first question referred to us, my opinion is as follows: In the absence of any express contract as to the duties of the plaintiff as
co-editor at the time of his appointment, the reasonable view on the facts of the case seems to me to be that the Managing Director was entitled as
a matter of law to vary the plaintiff''s duties and the hours of his attendance at the office from time to time, if such variation was not unreasonable or
inappropriate to his appointment as co-editor. The variation made in this case under Exhibit E was, in my opinion, not at all unreasonable or
inappropriate.
Coming to the second question, I might observe in the first place that the substantial consideration for the defendant''s promise to make certain
monthly payments to the plaintiff for his salary was the plaintiff''s reciprocal promise to perform the duties reasonably required of him from time to
time as appropriate to his post as co-editor. When the plaintiff failed to perform the duties so required of him and during the period for which such
failure lasted, the consideration for defendant''s promise totally failed and the defendant was not, therefore, legally bound to pay to the plaintiff his
(the plaintiff''s) salary for that period. [See Section 54 of the Contract Act and the illustration (d) thereto. See also Cuckson v. Stones (1858) 28
L.J. Q.B. 25 : 1 El. & El. 248 : 5 Jur. (N.S.) 337 : 7 W.R. 134 : 120 E.R. 902 : 117 R.R. 196.
The costs of the reference to this Court are to be paid by the plaintiff to the defendant.
Napier, J.
I entirely agree and only add one word on the first question submitted to us The statement of facts sets out that there was no express contract
fixing the duties of the plaintiff as co-editor and there is nothing to indicate that at any time the Board imported into their contract with the plaintiff
the terms of service which he allocated to himself by virtue of his position as Managing Director. I have no doubt that it came within the scope of
the powers of the Managing Director to allocate to the co-editor such duties as were suitable to his position and status as co-editor. When the
plaintiff was the Managing Director, he did allocate to himself such duties, and it is impossible to contend that whereas he had powers to fix his
duties as co-editor when he was the Managing Director, the new Managing Director had no powers to vary those duties within appropriate limits.
An attempt has been made to argue that the duties assigned to the plaintiff by Exhibit E were not consistent with his position. We have examined
the various duties assigned to different classes of employees of the Company and we find nothing derogatory to the position of the plaintiff in any
particular class of work which the Managing Director instructed him to do. I, therefore, think it is clear that it was within the powers of the
Managing Director to vary the plaintiff''s duties and hours of attendance as he did and the first question must be answered in the affirmative.
I entirely agree with my learned brother''s judgment with regard to the second question and with the disposal of this reference.