Sovereign Immunity in Commercial Matters?

Scope of Sovereign Immunity:

Business or commercial activities carried out by one Country in the territory of another country ordinarily not entitled to plead sovereign immunity.

Principle of sovereign Immunity

There is no agreed principle except this: that each State ought to have proper respect for the dignity and independence of other States. Beyond that principle there is no common ground. It is left to each State to apply the principle in its own way, and each has applied it differently. Some have adopted a rule of absolute immunity which, if carried to its logical extreme, is in danger of becoming an instrument of injustice. Others have adopted a rule of immunity for public acts but not for private acts, which has turned out to be a most elusive test. All admit exceptions. There is no uniform practice. There is no uniform rule. So there is no help there.
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What is cause of action?

A plaint before it can be entertained and registered as suit, it must plead cause of action.

What is cause of action?

While scrutinizing the plaint averments, it is the bounden duty of the trial Court to ascertain the materials for cause of action. The cause of action is a bundle of facts which taken with the law applicable to them gives the plaintiff the right to relief against the defendant. Every fact which is necessary for the plaintiff to prove to enable him to get a decree should be set out in clear terms. It is worthwhile to find out the meaning of the words “cause of action”. A cause of action must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue.

In A.B.C. Laminart Pvt. Ltd. & Anr. vs. A.P. Agencies, Salem (1989) 2 SCC 163, Supreme Court explained the meaning of “cause of action” as follows: Continue reading

Law of Limitation in India

Understanding Limitation Act, 1963

Every remedy has a period of limitation within which it can be invoked. The right to seek relief is extinguished after the period of limitation. In India the statute of limitation is called as Limitation Act which was enacted in the year 1963.

Though Act of 1963 is not the exclusive as remedies provided before various Tribunals under different statutes are governed by limitation under that statute yet the principles laid down in the cases decided in respect of Limitation Act would apply to those statutes as well.

This book covers the Limitation Act, 1963 and also the selected leading judgments of Supreme Court of India and Various High Courts of India. Wherever possible live links to judgments are provided.

The ebook is easily comprehensible by lawyers and laymen alike. Do use the feature of search to land at what you are looking for.

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Application of Limitation Act on Execution Proceedings

Objection application to Execution:

Execution proceedings are governed by Order 21 of

Civil Procedure Code 1908

Condonation of delay in seeking to set aside ex parte order:

Section 5 of the present Limitation Act, 1963, states that any appeal or any application under any of the provisions of Order 21, Civil Procedure Code, 1908, may be admitted after the prescribed period if the appellant or the appellant satisfies the Court that he had sufficient cause for not preferring the appeal or making the application within such period. The Explanation is omitted as unnecessary. Therefore, with reference to applications under Order 21, Civil Procedure Code, there is the statutory bar in applying section 5 of the Limitation Act.

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Pleading by an agent

Without pleadings, a party can not claim to be a mere agent of somebody.

Civil Procedure Code, 1908, Order 8 Rule 2.

Appellant cannot be permitted to say that though all the rights vested in it but it merely remained the agent of the Central Government. Acceptance of such a submission would require interpreting the expression `vesting’ as holding on behalf of some other person. Such a meaning cannot be given to the expression `vesting’.

It is a settled legal proposition that an agent cannot be sued where the principal is known. In the instant case, the appellant has not taken plea before either of the courts below. In view of the provisions of Order VIII Rule 2 CPC, the appellant was under an obligation to take a specific plea to show that the suit was not maintainable which it failed to do so. The vague plea to the extent that the suit was bad for non-joinder and, thus, was not maintainable, did not meet the requirement of law. The appellant ought to have taken a plea in the written statement that it was merely an `agent’ of the Central Government, thus the suit against it was not maintainable. More so, whether A is an agent of B is a question of fact and has to be properly pleaded and proved by adducing evidence.

[Source: National Textile Corp.Ltd vs Nareshkumar Badrikumar Jagad, decided by Sup Ct. on 5 September, 2011]

Obligation of lessee to hand over possession

Duty of lessee to hand over possession:

Transfer of Property Act, 1882; Section 108(q):

“on the determination of the lease, the lessee is bound to put the lessor into possession of the property”

Law in general prescribes and insists upon a specified conduct in human relationship or even otherwise. Within the limits of the law, courts strive to take note of the moral fabric of the law. In the instant case, under the terms of the lease, the property had to be handed over to the lessor. Besides under Section 108(q) of the Transfer of Property Act, on the determination of the lease, the lessee is bound to put the lessor into possession of the property. Since the landlord has not assented to the lessee’s continuance in possession of the property, the lessee will be liable to mesne profits which can again be recovered only in term of his wrongful possession. Continue reading

Transfer of matrimonial proceedings: Use video conferencing instead.

Forum Non Conveniens.

The doctrine of forum non conveniens can be applied in matrimonial proceedings for advancing interest of justice. Under the said doctrine, the court exercises its inherent jurisdiction to stay proceedings at a forum which is considered not to be convenient and there is any other forum which is considered to be more convenient for the interest of all the parties at the ends of justice.

In Spiliada Maritime (1986)3 All ER 843 case the House of Lords laid down the following principle:

“The fundamental principle applicable to both the stay of English proceedings on the ground that some other forum was the appropriate forum and also the grant of leave to serve proceedings out of the jurisdiction was that the court would choose that forum in which the case could be tried more suitably for the interest of all the parties and for the ends of justice.”

The criteria to determine which was a more appropriate forum, for the purpose of ordering stay of the suit, the court would look for that forum with which the action had the most real and substantial connection in terms of convenience or expense, availability of witnesses, the law governing the relevant transaction and the places where the parties resided or carried on business. If the court concluded that there was no other available forum which was more appropriate than the English court, it would normally refuse a stay. If, however, the court concluded that there was another forum which was prima facie more appropriate, the court would normally grant a stay unless there were circumstances militating against a stay. It was noted that as the dispute concerning the contract in which the proper law was English law, it meant that England was the appropriate forum in which the case could be more suitably tried. Continue reading

Difference between dead claim and time barred claims

Time barred claims are claimed barred by statute of limitation.

The Chief Justice or his Designate may however choose to decide whether the claim is a dead (long-barred) claim or whether the parties have, by recording satisfaction, exhausted all rights, obligations and remedies under the contract, so that neither the contract nor the arbitration agreement survived. When it is said that the Chief Justice or his Designate may choose to decide whether the claim is a dead claim, it is implied that he will do so only when the claim is evidently and patently a long time barred claim and there is no need for any detailed consideration of evidence.

An illustration of dead claim

If the contractor makes a claim a decade or so after completion of the work without referring to any acknowledgement of a liability or other factors that kept the claim alive in law, and the claim is patently long time barred, the Chief Justice or his Designate will examine whether the claim is a dead claim (that is, a long time barred claim).

On the other hand, if the contractor makes a claim for payment, beyond three years of completing of the work but say within five years of completion of work, and alleges that the final bill was drawn up and payments were made within three years before the claim, the court will not enter into a disputed question whether the claim was barred by limitation or not. The court will leave the matter to the decision of the Tribunal.

If the distinction between apparent and obvious dead claims, and claims involving disputed issues of limitation is not kept in view, the Chief Justice or his designate will end up deciding the question of limitation in all applications under section 11 of the (Arbitration and Conciliation) Act.

[Source: Indian Oil Corporation Ltd. v. M/s SPS Engineering Ltd.,2011 (2) SCALE 291 ]

Thus the claims which are  apparently barred by limitation and  are not in the realm of dispute which needs to be proved or disproved by evidence are dead claims.

Principles of seeking leave to defend in summary suit

Principles governing the grant of leave to defend a Summary suit:

Change in law as per amended Order XXXVII Rule 3 of the Code of Civil Procedure.

Good faith, genuineness of defence and triable issue is a consideration:

A Bench of Supreme Court comprising Justice Kurian Joseph and Justice RF Nariman has observed that the principles stated in paragraph 8 of Mechelec Engineers & Manufacturers v. Basic Equipment Corporation will now stand superseded, post amendment of Order XXXVII Rule 3 of the Code of Civil Procedure and in view of a four-judge bench decision in Milkhiram (India) (P) Ltd. v. Chamanlal Bros.

If the defendant satisfies the Court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit;

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Scope of power of attorney in Criminal Prosecution

Criminal Complaints through a Power of Attorney

The complaint in this case was a summary complaint under section 138 of Negotiable Instruments Act, 1888.

Whether a Power of Attorney holder can sign and file a complaint petition on behalf of the complainant ?

Supreme Court has answered the question in affirmative but subject to a few riders. The attorney acts as an agent of the complainant and therefore has to act in the name of principal:

“The power of attorney holder is the agent of the grantor. When the grantor authorizes the attorney holder to initiate legal proceedings and the attorney holder accordingly initiates such legal proceedings, he does so as the agent of the grantor and the initiation is by the grantor represented by his attorney holder and not by the attorney holder in his personal capacity. Therefore, where the payee is a proprietary concern, the complaint can be filed by the proprietor of the proprietary concern, describing himself as the sole proprietor of the payee, the proprietary concern, describing itself as a sole proprietary concern, represented by its sole proprietor, and the proprietor or the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor. However, we make it clear that the power of attorney holder cannot file a complaint in his own name as if he was the complainant. In other words, he can initiate criminal proceedings on behalf of the principal.”

Necessity of personal knowledge of attorney

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