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PETITIONER: BYRAM PESTONJI GARIWALA

       Vs.

RESPONDENT: UNION BANK OF INDIA AND ORS.

DATE OF JUDGMENT20/09/1991

BENCH: THOMMEN, T.K. (J) BENCH: THOMMEN, T.K. (J) SAHAI, R.M. (J)

CITATION:  1991 AIR 2234            1991 SCR  Supl. (1) 187  1992 SCC  (1)  31        JT 1991 (4)    15  1991 SCALE  (2)625

ACT:     Code  of  Civil  Procedure,  1908--Order  XXIII  Rule  3 -Compromise  --Counsel’s role--Pre and Post 1976 CPC  Amend- ment--Object of amendment-Legislative intention indicated.     Code  of  Civil Procedure, 1908--Order XXIII  read  with Order  XXI, Rule 22--Compromise entered into by the  Counsel of  defendant in High Court-Compromise decree  on  18.6.1984 Execution--Notice under Order XXI, Rule 22 to defendant made absolute on 23.1.1990--Questioning the compromise after  six years by chamber summon-- Effect of.

HEADNOTE:     Before  this Court, the  appellant-defendant  challenged the  judgment of the High Court which held that  the  decree made  against  the defendant ’in terms of  a  compromise  in writing  and signed by the counsel representing the  parties was  valid and binding on the parties, and that in  the  ab- sence  of any challenge against the order made  under  Order XXI,  rule 23, Civil Procedure Code, allowing  execution  of the  decree, the defendant was no longer entitled to  resist execution by recourse to Chamber Summons.     The appellant contended that the High Court was wrong in holding that, notwithstanding the amendment of 1976  insert- ing the words ’in writing and signed by the parties’, it was still sufficient if the terms of compromise were reduced  to writing and signed by counsel representing the parties,  and not necessarily by the parties in person, and that a  decree based  on a compromise not signed by the parties  in  person was a nullity and was incapable of execution.       The  respondents submitted that it was  always  under- stood  that the expression ’party’ included his  pleader  in matters relating to appearance in court, and his counsel  in the  cause,  therefore, had express  or  implied  authority, unless  specifically withdrawn or limited by the  party,  to represent  him  in court and do whatever  was  necessary  in connection with the conduct of his suit including adjustment of the suit by agreement or compromises. 188 Dismissing the appeal, this Court,     HELD:.  1. Counsel’s role in entering into a  compromise has been traditionally understood to be confined to  matters

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within  the scope of the suit. However, a compromise  decree may incorporate not only matters failing within the  subject matter of the suit, but also other matters which are collat- eral  to it. The position before the amendment in  1976  was that,  in respect of the former, the decree was  executable, but in respect of the latter, it was not executable,  though admissible as judicial evidence of its contents. [199 C-D]     2.  After  the amendment of 1976, a consent  decree,  is executable in terms thereof, even if it comprehends  matters failing outside the subject-matter of the suit, but concern- ing the parties. [201 E]     3.  The object of the amendment of Order XXIII, Rule  3, C.P.C.  was  to provide an appropriate  remedy  to  expedite proceedings  in Court. That object must be borne in mind  by adopting a purposive construction of the amended provisions. The legislative intention being the speedy disposal of cases with a view to relieving the litigants and the Courts  alike of  the burden of mounting arrears, the word ’parties’  must be  so construed as to yield a beneficent result, so  as  to eliminate the mischief the legislature had in mind. [202  D- E]     4.  There  is no reason to assume that  the  legislature intended  to curtail the implied authority of  counsel,  en- gaged in the thick of proceedings in court, to compromise or agree  on  matters  relating to the parties,  even  if  such matters exceed the subject matter of the suit. The relation- ship  of counsel and his party or the recognised  agent  and his principal is a matter of contract; and with the  freedom of  contract generally, the legislature does  not  interfere except when warranted by public policy, and the  legislative intent is expressly made manifest There is no such  declara- tion of policy or indication of intent in the present  case. The legislature has not evinced any intention to change  the well recognised and universally acclaimed common law  tradi- tion  of  an  ever alert, independent and  active  Bar  with freedom  to manoeuvre with force and drive for quick  action in  a  battle of wits typical of the adversarial  system  of oral heating which is in sharp contrast to the inquisitorial traditions  of the ’civil law’of France and  other  European and Latin American countries where written submissions  have the pride of place and oral arguments are 189 considered relatively insignificant. [202 E-H]      5.   Considering the traditionally recognised  role  of counsel in the common law system, and the evil sought to  be remedied by Parliament by the C.P.C. (Amendment) Act,  1976, namely  attainment of certainty and expeditious disposal  of cases by reducing the terms of compromise to writing  signed by  the parties, and allowing the compromise decree to  com- prehend  even matters falling outside the subject-matter  of the  suit,  but  relating to the  parties,  the  legislature cannot,  in the absence of express words to such effect,  be presumed  to  have disallowed the parties to  enter  into  a compromise by counsel in their cause or by their duly autho- rised  agents.  Any such presumption would  be  inconsistent with the legislative object of attaining quick reduction  of arrears  in  Court by elimination of uncertainties  and  en- largement of the scope of compromise. [205 F-H]     6. A judgment by consent is intended to stop  litigation between  the  parties just as much as a  judgment  resulting from a decision of the court at the end of a long drawn  out fight. A compromise decree creates an estoppel by  judgment. [207 B]     7.  In the present case, the notice issued  under  Order XXI  rule 22 was personally served on the defendant, but  he

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did  not appear or show cause why the decree should  not  be executed. The notice was accordingly made absolute by  order dated  23.1.1990 and leave was granted to the  plaintiff  to execute  the decree. The decree passed by the High Court  on 18.6.1984 in terms of the compromise was a valid decree  and it constituted res judicata. [206 F-G]     8. The consent decree made on 18.6.1984 remained unchal- lenged.  None questioned it. The appellant never raised  any doubt as to its validity or genuineness. He had no case that the decree was vitiated by fraud or misrepresentation or his counsel  lacked authority to enter into a compromise on  his behalf.  Nevertheless,  after six years  he  questioned  its validity  by means of chamber summons.  This was  an  unsuc- cessful challenge by reason of delay, estoppel or res  judi- cata. [207 E-F]     Halsbury’s. Laws of England, 4th Ed. Vol.3, Paras 1181 & 1183;  Francis Bennion’s Statutory  Interpretation,  Butter- worths, 1984, para 133; Crawford’s Statutory., Construction, Para 254; Rene David, English Law and French Law--Tagore Law Lectures, 1980; Spencer-Bower to Turner in Res 190 Judicata,  Second Edition, Page 37; The Common Law in  India 1960-The  Hamlyn Lectures, Twelfth Series. pp 1-4,  referred to.     Patience  Swinfen v. Lord Chelmsford, [1860]5 H & N  890 at  912; S.C.(Ex.) 382; Mathews v. Munster, [1887]  20  Q.B. 141 at 144; Rondel v. Worsley, [1965] 1 Q.B. 443,502; (Babu) Sheonandan Prasad Singh &Ors. v. Hakim Abdul Fateh  Mohammed Reza & Anr., AIR 1935 P.C. 119,121; Sourendera Nath Mitra  & Ors.  v.  Tarubala Dasi, AIR 1930 P.C. 158;  Hemanta  Kumari Debi  v. Midnapur Zamindari Co., AIR 1919 PC  79;  Jamilabai Abdul  Kadar v. Shankerlal Gulabchand & Ors.,  [1975]  Supp. SCR  336; Monoharbahal Colliery, Calcutta v. K.N.  Mishra  & Ors., AIR 1975 SC 1632; National Assistance Board v. Wilkin- son, [1952] 2 Q.B. 648; Sailendra Narayan Bhania Deo v.  The State  of Orissa, AIR 1956 SC 346; Mohanlal Goenka v.  Benoy Kishna  Mukherjee  & Ors., AIR 1953 SC 65,  Shankor  Sitaram Sontakke  & Anr. v. Balkrishna Sitaram Sontakke &  Ors.  AIR 1954 SC 352, referred to.     Ram  Juwan  v. Devendra Nath Gupta, AIR 1960 M  P.  280; Vishnu  Sitaram Auchat v. Ramchandra Govind Joshi, AIR  1932 Bombay  466;  Jasimuddin  Biswas v. Bhuban  Jelini,  ILR  34 Calcutta  456;  Ganganand Singh & Ors.  v.  Rameshwar  Singh Bahadur & Anr, AIR 1927 Patna 271; Chengan Soun, Nayakam  v. A.N. Menon, AIR 1968 Kerala 213; Jiwibai v. Ramkumar Shrini- was  Murarka Agarwala, AIR 1947 Nagpur 17;  Govindamreal  v. Marimuthu Maistry & Ors., AIR 1959 Mad 7; Laxmidas Ranchhod- das  & Ors. v. Savitabai Hargovindas Shah, AIR  1956  Bombay 54;  Mohan Bat v. Jai Kishan, AIR 1983 Rajasthan  240;  Smt. Mohan Bat v. Smt. Jai kishan & Ors., AIR 1988 RaJasthan  22, Nadirsha Hirji Bana & Ors. v Niranjanlkumar alias  Nireshku- mar Dharamchand Shah & Ors., 1983 (1) G.L.R. 774, approved.     Kesarla  Raghuram  v. Dr. Narsipalle  Vasundara,  A.I.R. 1983 A .P. disapproved.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3698 of 1991.     From  the  Judgment  and Order dated  1.11.1990  of  the Bombay  High  Court in Chamber Summons No. 838  of  1990  in Execution  Application  No. 242 of 1989 in Suit No.  309  of 1972.     Arun  Jaitley,  R.F. Nariman, R.  Karanjawala,  Mrs.  M.

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Karanjawala,  Ms. Nandini Gore and Ms. Aditi  Choudhary  for the appellant. 191 V.A. Bobde, U.A. Rao and B.R. Agarwala for the respondents. The Judgment of the Court was delivered by THOMMEN, J. Leave granted.     The  appellant who is the defendant in Suit No.  309  of 1972  challenges  the judgment of the Bombay High  Court  in Chamber Summons No. 838 of 1990 in Execution Application No. 242 of 1989 whereby the High Court held that the decree made against  the defendant in terms of a compromise  in  writing and  signed  by counsel representing the  parties,  but  not signed  by the parties in person, was valid and  binding  on the parties, and in the absence of any challenge against the order  made  under Order XXI rule 23, Civil  Procedure  Code allowing  execution  of  the decree, the  defendant  was  no longer  entitled to resist execution by recourse to  Chamber Summons. The High Court found that the decree was valid  and in accordance with the provisions of Order XXIII rule 3,  as amended by the C.P.C. (Amendment) Act, 1976.     The  only question which arises for consideration is  as regards  the construction of Order XXIII rule 3,  C.P.C.  We shall read this provision, as amended by the C.P.C.  (Amend- ment Act, 19%, bracketing the newly added words:          23.,  R. 3 - Compromise of suit where it is  proved to  the satisfaction of the court that a suit has  been  ad- justed wholly or in part by any lawful agreement or  compro- mise,  (in writing and signed by the parties) or  where  the defendant satisfied the plaintiff in respect of the whole or any part of the subject matter of the suit, the Court  shall order  such  agreement,  compromise or  satisfaction  to  be recorded,  and shall pass a decree in  accordance  therewith [so far as it relates to the parties to the suit, whether or not  the  subject  matter of the  agreement,  compromise  or satisfaction is the same as the subject matter of the suit: [Provided  that where it is alleged by one party and  denied by  the  other that an adjustment or satisfaction  had  been arrived  at,  the court shall decide the  question;  but  no adjournment shall be granted for the purpose of deciding the question,  unless  the court, for reasons  to  be  recorded, thinks fit to grant such adjournment.] [Explanation. - An agreement or compromise which is void  or voidable under the Indian Contract Act, 1872, shall not be 192 deemed to be lawful within the meaning of this rule.     Mr. Arun Jaitley, appearing for the appellant, says that the  High Court was wrong in holding  that,  notwithstanding the  amendment of 1976 inserting the words ’in  writing  and signed by the parties’, it was still sufficient if the terms of compromise were reduced to writing and signed by  counsel representing the parties, and not necessarily by the parties in  person. Any such construction would do violence  to  the provision as amended in 1976. He says that the object of the amendment  was  to provide that no agreement  or  compromise adjusting wholly or in part a pending suit was valid  unless such  compromise was evidenced in writing and signed by  the parties  in person. The expression ’parties’,  he  contends, means  only  parties and none else. To read  ’counsel’  into that  expression, as done by the High Court, is  to  presume that  the legislature failed to say what it intended to  say and  to  attempt to supply the omission  by  correcting  the deficiency.  This  cannot be done. The legislature,  on  the other hand, made its intention explicit by providing that an agreement  or  compromise would form the basis of  a  decree only  if the consensus was reduced to writing and signed  by

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the  parties. Neither an agent nor a pleader could act as  a substitute for a party to sign the agreement or  compromise. A decree based on a compromise not signed by the parties  in person is a nullity and is incapable of execution.     Mr. Jaitley submits that if the legislature had intended to  authorise counsel independently to sign  the  memorandum containing the terms of settlement, and allow a decree to be passed in terms thereof, the legislature would have said  so by  further  adding  the words ’or their  counsel’.  In  the absence  of any such expression, it cannot be presumed  that the  legislature  intended more than what it said  and  that ’party’  included counsel. This argument, Mr. Jaitley  says, is fortified by the fact that for the first time the  legis- lature  has  allowed a decree to be passed on the  basis  of compromise  relating to matters concerning the parties,  but extending beyond the subject matter of the suit. Such a wide power  to  compromise was most unlikely to be  left  in  the hands  of counsel, and it is, therefore, necessary  to  read the provision narrowly so as to read it as it now stands  by adopting a strictly literal construction.     Mr.  V.A.  Bobde appearing for the respondents,  on  the other  hand, submits that it was always understood that  the expression ’party’ included his pleader in matters  relating to appearance in court, and his counsel in the cause, there- fore, has express or implied authority, unless  specifically withdrawn or limited by the party, to represent him in court and do 193 whatever is necessary in connection with the conduct of  his suit  including adjustment of the suit by agreement or  com- promise.  In the absence of any such limitation or  restric- tion  of  his authority, counsel appearing for  a  party  is fully  competent  to put his signature to the terms  of  any compromise  upon  which  a decree can be  passed  in  proper compliance  with the provisions of Order XXIII rule 3 as  it now stands. Any such decree, he says, is perfectly valid.     Mr.  Bobde submits that in the absence of express  words to  the contrary, ’party’, in the context of proceedings  in court,  must  necessarily include his  recognised  agent  or pleader. This construction is warranted by the provisions of Order  III,  C.P.C. That this has been the  consistent  view adopted  by  courts in the construction  of  the  expression ’party’ in the context of proceedings in court is clear from the  decisions of courts, and it is most unlikely  that  the legislature  would have, by the amendment of  1976,  limited the  scope of ’party’ so as to exclude the traditional  role of the recognised agent or counsel. The legislative  drafts- men  are  presumed to know the law of the land as  it  stood then,  and, if they had intended to deviate therefrom,  they would  have  explicitly stated so rather than  leave  it  to future  judicial construction. The Statement of Objects  and Reasons  for  the amendment, he says, does not  support  the view canvassed by the appellant.     Sub-clause  (iii) of clause 77 of the Statement  of  Ob- jects  and  Reasons concerning the C.P.C.  (Amendment)  Act, 1976 states:-                         is  provided  that an  agreement  or               compromise  under rule 3 should be in  writing               and signed by the parties. This is with a view               to avoiding the setting up of oral  agreements               or  compromises to delay the progress  of  the               suit.                ............................................                    In  view of the words ’so far as  it  re-               lates to the suit’ in rule 3, a       question

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             arises  whether a decree which refers  to  the               terms  of  a       compromise  in  respect  of               matters  beyond the scope of the suit       is               executable or whether the, terms of the decree               relating to the      matters outside the  suit               can be enforced only by a separate       suit.               The amendment seeks to clarify the position."                   The  Statement  of  Objects  and   Reasons               indicates  that the amendment is  intended  to               clarify that a compromise has to be in writing               signed  by  the parties to avoid  delay  which               might  arise  from the uncertainties  of  oral               agreements.  The amendment has also  clarified               that the terms of compromise are permitted  to               include all matters relating to the parties to               the               194               suit  even  if such matters fall  outside  the               subject  matter of the suit.  The  legislature               has thus sought to attain certainty and clari-               ty  and  widen the scope  of  compromise.  The               fundamental question is, in the absence of any               contrary  indication in the Statement  of  Ob-               jects  and Reasons, can it be stated that  the               legislature has intended to exclude a  pleader               or  a  recognised agent  from  the  expression               ’party’ when it has always been understood, as               explicitly  stated in Order 1II rule  1,  that               appearance  of  a  party in court  may  be  in               person or by his recognised agent or  pleader.               In  the absence of any provision to  the  con-               trary, can it be stated that the  legislature,               when using the expression ’parties’ in rule  3               of  Order  XXIII,  limited it  to  parties  in               person  and  excluded  their  duly  recognised               agents or counsel ?                    The  role of counsel in Court in  England               is  described in Halsbury’s Laws  of  England,               4th Ed. Vol.3, paras 1181 & 1183, as follows:-               "1181. Counsel’s authority. At the trial of an               action,  counsel’s authority extends, when  it               is  not expressly limited, to the  action  and               all  matters incidental to it and to the  con-               duct  of  the trial, such as  withdrawing  the               record,  challenging a juror, calling  or  not               calling  witnesses,  cross-examining  or   not               cross-examining  witnesses,  consenting  to  a               reference  to arbitration, a compromise, or  a               verdict,  undertaking  to appear, or,  on  the               hearing of a motion for a new trial,  consent-               ing to a reduction of damages.               The  client’s  consent  is not  needed  for  a               matter which is within the ordinary  authority               of counsel: thus if, in court, in the  absence               of  the client, a compromise or settlement  is               entered  into by counsel whose  authority  has               not  been  expressly limited,  the  client  is               bound. If an action is settled in court in the               presence  of the client, his consent  will  be               inferred, and he will not be heard to say that               he   did   not  understand  what   was   going               on  .......  "      The implied authority of counsel in England is,  howev- er, confined to matters failing within the subject matter of the  suit. In the absence of     express authority,  counsel

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cannot enter into compromise on collateral matters.               "The  authority  of counsel to  compromise  is               limited to the issues in the action: a compro-               mise  by counsel affecting collateral  matters               will not bind the client, unless he  expressly               assents;  and it may be that a  barrister  has               no authority to reach a binding settlement  or               compromise out of court. "(Halsbury ibid) 195     A  compromise is, however, not binding and is liable  to be set aside in circumstances which would invalidate  agree- ments between the parties.               "A  compromise  by counsel will not  bind  the               client,  if counsel is not apprised  of  facts               the knowledge of which is essential in  refer-               ence to the question on which he has to  exer-               cise  his  discretion, for  example  that  the               terms  accepted had already been  rejected  by               the  client. Where counsel enters into a  com-               promise in intended pursuance of terms  agreed               upon  between  the clients, and,  owing  to  a               misunderstanding,  the  compromise  fails   to               carry  out  the intentions of  one  side,  the               compromise  does not bind the client, and  the               court will allow the consent to be  withdrawn.               Where, acting upon instructions to compromise,               counsel  consents under a misunderstanding  to               certain  terms which do not carry into  effect               the  intentions of counsel and the  terms  are               thought  by  one party to the  more  extensive               than the other party intends them to be, there               is  no agreement on the subject-matter of  the               compromise,  and the court will set it  aside.               But a person who has consented to a compromise               will  not be allowed to withdraw  his  consent               because he subsequently discovers that he  has               a  good  ground of defence?  (Halsbury,  ibid,               para 1183).     Counsel’s  consent  in  certain  circumstances  such  as duress or mistake may not bind the client.               "If  counsel’s consent is given under  duress,               the client will not be bound, as when counsel,               acting  for a client alleged to be of  unsound               mind  but believing him to be of  sound  mind,               consented to certain terms for the  withdrawal               of Court of Protection proceedings against the               client  because of his fear of  the  inconven-               ience  and iII-health likely to arise  to  the               client from confinement.               A  compromise  or  order made  by  consent  by               counsel  for  a minor or  other  person  under               disability  is  not  binding  on  the  client,               unless it is sanctioned by the court as  being               for  the  benefit  of the  client.  The  court               cannot,  however,  enforce a compromise  on  a               minor  against  the opinion of  his  counsel."               (Halsbury, ibid) One  of the early English authorities on this point  is  Pa- tience Swinfen 196 v. Lord Chelmsford [1860] 5 H & N 890 at 922; S.C. 29 L.  J. (E.x)  382. Delivering the judgment of the  Court,  Pollock, C.B., stated:               "....We are of opinion, that although a  coun-               sel has complete authority over the suit,  the

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             mode  of conducting it, and all that is  inci-               dent  to it - such as withdrawing the  record,               withdrawing a juror, calling no witnesses,  or               selecting  such  as,. in  his  discretion,  he               thinks  ought to be called, and other  matters               which  properly  belong to the  suit  and  the               management and conduct of the trial - we think               he  has not, by virtue of his retainer in  the               suit, any power over matters that are  collat-               eral to it  .......  ".     In Matthews v. Munster, [1887] 20 Q.B. 141 at 144,  Lord Esher M.R. stated: ..  The instances that are given shew that one of the things                that  counsel may do, so long as the  request               of the client to him to act as advocate is  in               force, is to assent to a verdict for a partic-               ular  amount and upon certain  conditions  and               terms;  and the consent of the advocate  to  a               verdict against his client and the withdrawing               of imputations is a matter within the  expres-               sion  ’conduct  of the cause and all  that  is               incidental  to it.’ If the client is in  Court               and  desires  that the case should go  on  and               counsel  refuses,  if after that he  does  not               withdraw  his authority to counsel to act  for               him, and acquaint the other side with this, he               must  be  taken to have agreed to  the  course               proposed.  This case is a still stronger  one,               for the client was not present, and it is  not               pretended that he ever withdrew his  authority               to counsel, but he now comes forward and  asks               that  because he does not like what  has  been               done it should be set aside as between himself               and his opponent. This the Court will not  do,               and this appeal must be dismissed." See  also  Rondel v. Worsley, [1965] 1 Q. B. 443,  502,  Per Lord Denning M.R.     If this is the position of counsel in England,  Scotland and  Ireland, is his position the same in India in the  con- duct  of  cases in Court ? That the answer  is  affirmative, there is high judicial authority.     In (Babu) Sheonandan Prasad Singh & Ors. v. Hakim  Abdul Fateh  Mohammad  Reza & .Anr., AIR 1935 PC  119,  121,  Lord Atkin, speaking for 197 the Board, states:               "......  As was laid down by this Board in  57               IA 133 (AIR 1930 PC 158) counsel in India have               the  same implied authority to  compromise  an               action as have counsel in the English  Courts.               But if such authority is invoked to support an               agreement of compromise the circumstances must               be  carefully examined. In the first  instance               the  authority is an actual authority  implied               from the employment as counsel. It may however               be withdrawn or limited by the client: in such               a  case the actual authority is  destroyed  or               restricted;  and the other party if  in  igno-               rance  of the limitation could only rely  upon               ostensible authority. In this particular class               of  contract however the possibility  of  suc-               cessfully  alleging ostensible  authority  has               been  much restricted by the authorities  such               as  (1902)  AC 465 and (1919) 1 KB  474  which               make it plain that if in fact counsel has  had

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             his  authority  withdrawn  or  restricted  the               Courts  will not feel bound to enforce a  com-               promise  made by him contrary to the  restric-               tion even though the lack of actual  authority               is not known to the other party."     Lord  Atkin emphasises the need to rely on  express  au- thority, rather than implied authority, particularly because of  easier  and quicker communication with  the  client.  He says:               "....In  their Lordships’ experience  both  in               this  country and in India it constantly  hap-               pens, indeed it may be said that it more often               happens,  that counsel do not take upon  them-               selves to compromise a case without  receiving               express  authority from their clients for  the               particular  terms; and that this  position  in               each particular case is mutually known between               the parties.               In  such cases the parties are relying not  on               implied  but  on  an        express  authority               given  adhoc  by  the  client   .........   ".               (ibid, page       121)     However, collateral matters were understood to be beyond the scope of compromise. Lord Atkin says:               "If  the facts are as their Lordships  assume,               the  matter compromised was in  their  opinion               collateral  to the suit and not only would  it               not be binding on the parties, but it would in               any  case be a matter in respect of which  the               Court in pursuance of 198 O. 23, R. 3, should not make a decree." (Page 122)     Referring to the role of counsel in India and  comparing him with his counterpart in Britain, Lord Atkin in Sourendra Nath Mitra & Ors. v. Tarubala Dasi, AIR 1930 PC 158, says:               "  .....  Their Lordships regard the power  to               compromise a suit as inherent in the  position               of  an advocate in India.  The  considerations               which  have  led to this implied  power  being               established  in  the  advocates  of   England,               Scotland  and Ireland, apply in equal  measure               to  India. It is a power deemed to  exist  be-               cause its existence is necessary to effectuate               the relations between advocate and client,  to               make  possible  the duties  imposed  upon  the               advocate by his acceptance of the cause of his               client."     Counsel’s power to compromise is vital to the defence of his  party  while engaged on his behalf in the  thick  of  a legal battle in Court. Lord Atkin observes:               "The  advocate is to conduct the cause of  his               client  to the utmost of his skill and  under-               standing.  He  must in the  interests  of  his               client  be  in  the position,  hour  by  hour,               almost  minute  by  minute,  to  advance  this               argument,  to withdraw that; he must make  the               final decision whether evidence is to be given               or  not  on  any question of  fact;  skill  in               advocacy is largely the result of  discrimina-               tion. These powers in themselves almost amount               to powers of compromise: one point is given up               that  another may prevail. But in addition  to               these  duties,  there  is from  time  to  time               thrown upon the advocate, the responsible task               of deciding whether in the course of a case he

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             shall  accept an offer made to him, or on  his               part  shall  make  an offer  on  his  client’s               behalf  to receive or pay something less  than               the full claim or the full possible liability.               Often   the   decision   must   be   made   at               once  .......  "(ibid, page 161)     Emphasising  the apparent authority of counsel, and  the raison d’etre of such authority being the paramount interest of  his client, and not an appandage of office,  Lord  Atkin states:               "The  apparent authority is derived  from  the               known     existence     of     the     implied               authority  ..........               199                 First,  the implied authority of counsel  is               not an appandage of office, a dignity added by               the  Courts  to  the status  of  barrister  or               advocate  at law. It is implied in the  inter-               ests of the client, to give the fullest  bene-               ficial  effect to his employment of the  advo-               cate.  Secondly,  the  implied  authority  can               always be countermanded by the express  direc-               tions  of the client. No advocate  has  actual               authority  to settle a  case against  the  ex-               press  instructions of his client. If he  con-               siders such express instructions, contrary  to               the interests of his client, his remedy is  to               return his brief.               Their  Lordships  are unable to  see  why  the               above  considerations should not apply  to  an               advocate in India, whose duties to his  client               in  the  conduct of a suit in no  wise  differ               from  those of advocates in England,  Scotland               and Ireland  ..........  ". (Page 161)     Counsel’s  role in entering into a compromise  has  been traditionally  understood to be confined to  matters  within the  scope  of the suit. However, a  compromise  decree  may incorporate  not  only matters failing  within  the  subject matter of the suit, but also other matters which are collat- eral  to it. The position before the amendment in  1976  was that,  in respect of the former, the decree was  executable, but in respect of the latter, it was not executable,  though admissible as judicial evidence of its contents.     Referring to section 375 of the Code of Civil  Procedure (Act XIV of 1882), (similar to Order XXIII rule 3 CPC as  it stood  prior to the amendment of 1976), Lord Buckmaster,  in Hemanta  Kumari Debi v. Midnapur Zamindari Co., AIR 1919  PC 79, states:               "   ........  In the first place, it is  plain               that the agreement or compromise, in whole and               not in part, is to be recorded, and the decree               is then to confine its operation to so much of               the  subject-matter  of the suit as  is  dealt               with  by the  agreement   ............although               the  operative  part of the  decree  would  be               properly confined to the actual subject-matter               of  the  then existing litigation  the  decree               taken as a whole would include the  agreement.               This  in  fact is what the decree did  in  the               present  case. It may be that as a  decree  it               was  incapable of being executed  outside  the               lands  of the suit, but that does not  prevent               its  being  received in evidence of  its  con-               tents". (Page 81) In Ram Juwan v. Devendra Nath Gupta, AIR 1960 Madhya Pradesh

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200 280, the High Court states:               "Where a consent decree contains terms that do               not  relate  to the suit   .....   such  terms               cannot be enforced in execution of the  decree               but  they may be enforced as a contract  by  a               separate suit". (Page 282)     See  also  Vishnu Sitaram Auchat v.  Ramachandra  Govind Joshi,  AIR 1932 Bombay 466 and Jasimuddin Biswas v.  Bhuban Jelini, ILR 34 Calcutta 456.     In  Ganganand Singh & Ors. v. Rameshwar Singh Bahadur  & Anr.,  AIR 1927 Patna 271, the High Court points out that  a consent  decree  does not stand on a higher footing  than  a contract  between  the  parties. The Court  always  has  the jurisdiction  to set aside a consent decree upon any  ground which will invalidate an agreement between the parties.   In the absence of any such ground, the consent decree is  bind- ing on the parties.     Courts in India have consistently recognised the  tradi- tional  role of lawyers and the extent and nature  of  their implied authority to act on behalf of their clients.  Speak- ing  for  a Full Bench of the Kerala High Court  in  Chengan Souri  Nayakam  v.  A.N. Menon, AIR 1968  Kerala  213,  K.K. Mathew, J. (as he then was) observed:               "The construction of a document appointing  an               agent is different from the construction of  a               vakalat appointing counsel. In the case of  an               agent the document would be construed strictly               and  the agent would have only such powers  as               are conferred expressly or by necessary impli-               cation.   In the case of counsel the  rule  is               otherwise because there we are dealing with  a               profession  where well-known rules have  crys-               tallised through usage. It is on a par with  a               trade  where the usage becomes  an  additional               term  of the contract, if not contrary to  the               general law or excluded by express agreement."               (p.215). About  the  special position of the  advocate,  the  learned Judge stated:   Counsel  has a tripartite relationship; one with the  pub- lic, another with the court, and the third with his  client. That is a unique feature. Other professions or callings  may include  one or two of these relationships but no other  has the  triple duty. Counsel’s duty to the public is unique  in that he has to accept all work from all clients in courts in which he holds himself out 201 as  practicing,  however,  unattractive  the  case  or   the client." (p. 216)     See also Jiwibai v. Ramkumar Shriniwas Murarka Agarwala, AIR 1947 Nagpur 17; Govindammal v. Marimuthu Maistry & Ors., AIR 1959 Mad. 7 and Laxmidas Ranchhoddas & Ors. v. Savitabai Hargovindas Shah, AIR 1956 Born. 54.     These principles were affirmed by this Court in  Jamila- bai Abdul Kadar v. Shankerlal Gulabchand & Ors. [1975] Supp. SCR  336. Referring to a number of decisions on  the  point, V.R. Krishna Iyer, J. observes:               "   ..........  Those who know how courts  and               counsel function will need no education on the               jurisprudence of lawyer’s position and powers.               Of course, we hasten to enter a caveat. It  is               perfectly  open  to a party,  tike  any  other               principal,  to mark out in the vakalat  or  by               particular  instructions  forbidden  areas  or

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             expressly withhold the right to act in  sensi-               tive  matters,  the choice being his,  as  the               master. If the lawyer regards these fetters as               inconsistent with his position, he may  refuse               or  return  the  brief.  But  absent  speaking               instructions to the contrary, the power to act               takes in its wings the right and duty to  save               a  client by settling the suit if and only  if               he does so bona fide in the interests and  for               the  advantage of his client  .......   "(Page               346)     See also Monoharbahal Colliery Calcutta v. K.N. Mishra & Ors., AIR 1975 SC 1632.     After  the amendment of 1976, a consent decree, as  seen above, is executable in terms thereof even if it comprehends matters falling outside the subject-matter of the suit,  but concerning  the  parties. The argument  of  the  appellant’s counsel  is  that  the legislature  has  intended  that  the agreement  or compromise should be signed by the parties  in person,  because  the responsibility  for  compromising  the suit, including matters falling outside its  subject-matter, should be borne by none but the parties themselves. I1  this contention is valid, the question arises why the legislature has,  presumably being well aware of the  consistently  fol- lowed  practice of the British and Indian  Courts,  suddenly interfered  with  the time-honoured role of lawyers  in  the conduct  of  cases without specifically so stating,  but  by implication? Can the legislature be presumed to have  funda- mentally  altered  the position of counsel or  a  recognised agent, as traditionally understood in the system of law  and practice followed in India and other ’common law  countries’ without expressly and directly so stating? There is, 202 no indication in preparatory work such as the 54th Report of the  Law  Commission dated 6.2.1973 or in the  Statement  of Objects and Reasons or in the words employed by the legisla- ture that the concept of ’agents and pleaders’ of Order III, C.P.C.  was in any manner altered. There is no  warrant  for any such presumption.     It is a rule of legal policy that law should be  altered deliberately rather than casually. Legislature does not make radical  changes in law by a sidewind, but only by  measured and  considered  provisions’. (Francis  Bennion’s  Statutory Interpretation,  Butterworth, 1984, para 133). As stated  by Lord  Devlin  in  National Assistance  Board  v.  Wilkinson, [1952] 2 Q.B. 648:--               "It  is a well-established principle  of  con-               struction that a statute is not to be taken as               effecting  a  fundamental  alteration  in  the               general  law unless it uses words  that  point               unmistakably to that conclusion."     Statutes relating to remedies and procedure must receive a  liberal construction ’especially so as to secure  a  more effective,  a  speedier,  a simpler, and  a  less  expensive administration of law’.  See Crawford’s Statutory  Construc- tion, para 254.  The object of the amendment was to  provide an appropriate remedy to expedite proceedings in Court. That object  must be borne in mind by adopting a  purposive  con- struction of the amended provisions. The legislative  inten- tion  being  the  speedy disposal of cases with  a  view  to relieving  the litigants and the Courts alike of the  burden of mounting arrears, the word ’parties’ must be so construed as  to  yield a beneficent result, so as  to  eliminate  the mischief the legislature had in mind.     There  is no reason to assume that the  legislature  in-

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tended to curtail the implied authority of counsel,  engaged in the thick of proceedings in court, to compromise agree on matters relating to the parties, even if such matters exceed the subject-matter of the suit. The relationship of  counsel and his party or the recognised agent and his principal is a matter of contract; and with the freedom of contract  gener- ally,  the legislature does not interfere except  when  war- ranted  by  public  policy, and the  legislative  intent  is expressly  made  manifest There is no  such  declaration  of policy  or  indication of intent in the  present  case.  The legislature has not evinced any intention to change the well recognised and universally acclaimed common law tradition of an  ever alert, independent and active. Bar with freedom  to manoeuvre with force and drive for quick action in a  battle of  wits typical of the adversarial system of  oral  hearing which is in sharp contrast to the 203 inquisitorial  traditions of the ’civil law’ of  France  and other  European and Latin American countries  where  written submissions  have the pride of place and oral arguments  are considered  relatively  insignificant.   (See  Rene   David, English  Law  and French Law - Tagore Law  Lectures,  1980). ’The  civil  law’  is indeed equally  efficacious  and  even older,  but  it  is the product of  a  different  tradition, culture and language and there is no indication,.  whatever, that Parliament was addressing itself to the task .of assim- ilating  or  incorporating the rules and practices  of  that system into our own system of judicial administration.     The Indian legal system is the product of history. It is rooted  in our soil; nurtured and nourished by our  culture, languages-and  traditions;  fostered and  sharpened  by  our genius  and quest for social justice; reinforced by  history and  heritage: it is not a mere copy of the  English  common law;  though inspired and strengthened, guided and  enriched by  concepts and precepts of justice, enquiry and good  con- science which arc indeed the hallmark of the common law.  In the words of M.C. Setalvad:               "   ........  the common law of  England  with               its statutory modifications and the  doctrines               of  the  English courts of equity  has  deeply               coloured  and  influenced  the  laws  and  the               system of  judicial administration of a  whole               sub-continent inhabited by nearly four hundred               million  people. The law and jurisprudence  of               this  vast community and its pattern of  judi-               cial  administration are in many matters  dif-               ferent from those of England in which they had               their roots and from which they were nurtured.               Yet  they  bear the  unmistakable  impress  of               their origin.  The massive structure of Indian               law  and jurisprudence resembles  the  height,               the  symmetry and the grandeur of  the  common               and  statute  law of England. In it  one  sees               English  law in the distant perspective  of  a               new atmosphere and a strange clime."      Speaking  of  the common law in the  wider  sense,  the learned author continues: -               "....But  the English brought into  India  not               only the mass of legal rules strictly known as               the  common  law but  also  their               traditions,  outlook and techniques in  estab-               lishing, maintaining and developing the  judi-               cial  system. When, therefore, I speak of  the               common law in India I have in view  comprehen-               sively  all that is of English origin  in  our

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             system of law. In that wide meaning               204               the  expression will include not only what  in               England  is known strictly as the  common  law               but  also its traditions, some of the  princi-               ples  underlying the English statute law,  the               equitable  principles developed in England  in               order  to mitigate the rigours of  the  common               law and even the attitudes and methods pervad-               ing  the British system of the  administration               of justice."               The  Common  Law in India, 1960 -  The  Hamlyn               Lectures, Twelth Series, pp.1-4.     After the attainment of independence and the adoption of the  Constitution of India, judicial administration and  the constitution  of the law courts remained  fundamentally  un- changed, except in matters such as the abolition of  appeals to the Privy Council, the constitution of the Supreme  Court of India as the apex court, the conferment of writ jurisdic- tion  on all the High Courts, etc.  The  concept,  structure and  organisation of Courts, the substantive and  procedural laws, the adversarial system of trial and other  proceedings and  the function of judges and lawyers  remained  basically unaltered  and  rooted  in  the  common  law  traditions  in contra-distinction  to those prevailing in the civil law  or other systems of law.    In our own system of judicial administration, if  strains have developed and cracks have appeared by the stresses  and 2pressures  of  the  time; if aberrations  have  become  too obvious  to be ignored or too deeprooted to be corrected  by an internal mechanism; if the traditional role of the  legal profession requires urgent legislative scrutiny with a  view to remedying the defects and strengthening and  safeguarding the  system;  it is a matter exclusively for  Parliament  to consider; but the amendment in question is not addressed  to that purpose.     Aberrations  there always have been in every  system  of administration;  but whether they are merely  peripheral  or transient  in character-mere ripples on a placid pool  -  or symptomatic of deeper malady requiring structural  modifica- tion by prompt legislative intervention is a matter of grave significance  for  the jurists, sociologists  and  political scientists to ponder over.     So  long  as the system of  judicial  administration  in India continues unaltered, and so long as Parliament has not evinced an intention to change its basic character, there is no reason to assume that Parliament has, though not express- ly,  but  impliedly reduced counsel’s role  or  capacity  to represent  his  client as effectively as in the past.  On  a matter  of such vital importance, it is most  unlikely  that Parliament would have resorted 205 to  implied legislative alteration of counsel’s capacity  or status or effectiveness. In this respect, the words of  Lord Atkin  in  Sourendra (supra) comparing the  Indian  advocate with  the  advocate in England, Scotland  and  Ireland,  are significant:               There  are no local conditions which  make  it               less desirable for the client to have the full               benefit of an advocate’s experience and  judg-               ment.  One  reason, indeed,  for  refusing  to               imply  such a power would be a lack of  confi-               dence  in  the integrity or  judgment  of  the               Indian advocate.  No such considerations  have               been  or indeed could be advanced,  and  their

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             Lordships   mention   them  but   to   dismiss               them  ........  (Page 161)     Similar  is  the view expressed by  the  Rajasthan  High Court  in Mohan Bai v. Jai kishan, AIR 1983  Rajasthan  240; Smt.  Mohan Bai v. Smtjai kishan & Ors., AIR 1988  Rajasthan 22  and by the Gujarat High Court in Nadirsha Hirji Baria  & Ors.  v. Niranjankumar alias Nireshkumar Dharamchand Shah  & Ors.,  1983  (1) G.L.R. 774. A contrary view  has  been  ex- pressed  by the Andhra Pradesh High Court in Kesarla  Raghu- ram.  v. Dr. Narsipalle Vasundara, AIR 1983  Andhra  Pradesh 32, and it does not commend itself to us.     We  may, however, hasten to add that it will be  prudent for  counsel  not to act on implied  authority  except  when warranted by the exigency of circumstances demanding immedi- ate  adjustment of suit by agreement or compromise  and  the signature  of  the party cannot be  obtained  without  undue delay.  In these days of easier and  quicker  communication, such contingency may seldom arise. A wise and careful  coun- sel will no doubt arm himself in advance with the  necessary authority  expressed in writing to meet all such  contingen- cies  in order that neither his authority nor  integrity  is ever doubted.  This essential precaution will safeguard  the personal  reputation of counsel as well as uphold the  pres- tige and dignity of the legal profession.     Considering the traditionally recognised role of counsel in the common law system, and the evil sought to be remedied by  Parliament by the C.P.C. (Amendment) Act, 1976,  namely, attainment of certainty and expeditious disposal of cases by reducing  the terms of compromise to writing signed  by  the parties,  and allowing the compromise decree  to  comprehend even matters falling outside the subject-matter of the suit, but relating to the parties, the legislature cannot, in  the absence of express words to such effect, be presumed to have disallowed the parties to enter into a compromise by counsel in their cause or by their duly authorised agents. Any 206 such presumption would be inconsistent with the  legislative object  of attaining quick reduction of arrears in Court  by elimination of uncertainties and enlargement of the scope of compromise.     To insist upon the party himself personally signing  the agreement or compromise would often cause undue delay,  loss and  inconvenience, especially in the case  of  non-resident persons.  It has always been universally understood  that  a party can always act by his duly authorised  representative. If a power-of-attorney holder can enter into an agreement or compromise  on  behalf  of his principal,  so  can  counsel, possessed of the requisite authorisation by vakalatnama, act on  behalf of his client. Not to recognise such capacity  is not only to cause much inconvenience and loss to the parties personally, but also to delay the progress of proceedings in court. If the legislature had intended to make such a funda- mental change, even at the risk of delay, inconvenience  and needless expenditure, it would have expressly so stated.     Accordingly,  we  are  of the view that  the  words  ’in writing  and signed by the parties’, inserted by the  C.P.C. (Amendment) Act, 1976, must necessarily mean, to borrow  the language of Order II1 rule 1 C.P.C.:               "any  appearance application or act in  or  to               any court, required or authorized by law to be               made  or  done by a party in such  court,  may               except  where otherwise expressly provided  by               any  law for the time being in force, be  made               or  done  by the party in person,  or  by  his               recognized agent, or by a pleader,  appearing,

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             applying or acting as the case may be, on  his               behalf:               Provided  that any such appearance  shall,  if               the court so directs, be made by the party  in               person".               (emphasis supplied)     In  the present case, the notice issued under Order  XXI rule  22 was personally served on the defendant, but he  did not  appear or show cause why the decree should not be  exe- cuted.  The  notice was accordingly made absolute  by  Order dated  23.1.1990 and leave was granted to the  plaintiff  to execute  the decree. The decree passed by the High Court  on 18.6.1984 in terms of the compromise was a valid decree  and it  constituted  res judicata. As stated by  this  Court  in Shankar  Sitaram Sontakke & Anr. v. Balkrishna Sitaram  Son- takke & Ors., AIR 1954 SC 352:-               "......   It  is well settled that  a  consent               decree is as binding upon the parties  thereto               as a decree passed by invitum. The com-               207               promise  having been found not to be  vitiated               by fraud, misrepresentation,  misunderstanding               or mistake, the decree passed thereon has  the               binding force of ’res judicata’." (Page 355)     S.R.  Das, C.J., in Sailendra Narayan Bhanja Deo v.  The State of Orissa, AIR 1956 SC 346, states:               "....  a judgment by consent or default is  as               effective an estoppel between the parties as a               judgment whereby the court exercises its  mind               on a contested case  ......  ". (Page 351)     A  judgment  by consent is intended to  stop  litigation between  the  parties just as much as a  judgment  resulting from a decision of the court at the end of a long drawn  out fight. A compromise decree creates an estoppel by  judgment. As  stated by Spencer-Bower & Turner in Res Judicata  Second Edition, page 37:               "Any judgment or order which in other respects               answers  to the description of a res  judicata               is  nonetheless  so  because it  was  made  in               pursuance of the consent and agreement of  the               parties  ....  Accordingly, judgments, orders,               and awards by consent have always been held no               less  efficacious  as  estoppels  than   other               judgments, orders or decisions, though  doubts               have  been  occasionally  expressed   whether,               strictly,  the foundation of the  estoppel  in               such  cases is not representation by  conduct,               rather                than                 res               judicata  ......................  ".     See  also  Mohanlal Goenka v. Benoy Kishna  Mukherjee  & Ors., AIR 1953 SC 65.     The  consent decree made on 18.6.1984  remained  unchal- lenged.  None questioned it. The appellant never raised  any doubt as to its validity or genuineness. He had no case that the decree was vitiated by fraud or misrepresentation or his counsel  lacked authority to enter into a compromise on  his behalf.   Nevertheless,  after six years he  questioned  its validity by means of chamber summons. This was an unsuccess- ful challenge by reason of delay, estoppel or res  judicata, and was rightly so held by the High Court.      Accordingly,  we  see no merit in this  appeal.  It  is dismissed. However, in the circumstances of the case, we  do not make any order as to costs. V.P.R.                                                Appeal dismissed.

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