2014 PLP 278 (PLC)

ABDUL GHIAS NOUSHERWANI (MEMBER).

This appeal is directed against the order/judgment dated 27-11-2013 passed by Learned District and Sessions Judge Presiding Officer Labour Court 1st Balochistan Quetta in Case No.29 of 2013 whereby application filed by respondents was accepted and application under section 41 of BIRA, 2010 has been returned under Order VII, Rule 10, C.P.C. with the direction to present the same before Civil Judge at Karachi.

2. It is the case of appellant/applicant that he was appointed by respondent on 4-8-1996 as Territory Manager Grade A with effect from 23-7-1996 with head quarter at Quetta and in this regard a contract was executed on above date between the respondents and appellant. Thereafter on 1-3-2004 he was promoted as Area Manager. It is stated by appellant/applicant that during his service, he has shown good performance and appreciation letters, award on good performance and received many cash prizes which are evident from the annexed documents. It is further case of appellant/applicant that transfer letter was issued on 6-5-2013 from Quetta to Karachi with Mala fide intention to deprive the appellant from above mentioned performance and depute/appoint his influential persons, but due to some difficulties at home he was unable to join his duty. Consequently on 24-6-2013 he was terminated on the ground that he has not join his service at Karachi. Accordingly, at first stage he issued grievance notice in respect of transfer order, and thereafter with that of termination order. After cordial formalities filed application under section 41 of BIRA, 2010 which was returned under Order VII, Rule 10, C.P.C. on the application of respondent, hence this appeal.

3. The learned counsel for appellant/applicant contended that when on 4-8-1996 he was appointed as Territory Manager, a contract was executed by means of appointment letter, wherein a specific term was included i.e. that any legal proceedings shall be initiated at Karachi, which is not applicable at present for the reason that after first appointment he was promoted but no new contract was executed. Secondly, under section 28 of Contract Act, such condition is void. Next contended that the appellant/applicant did not disobey the transfer order, but due to illness of his parents who too expired during proceedings. Next contended that the appellant/applicant fall within the category of worker/Workman by nature of his work, which wrongly assumed by the Learned Trial Court that he being Area Manager does not fulfill the condition of worker/workman. The learned counsel for respondent on the other hand, while supporting the impugned judgment contended that Clause 13 of appointment letter does not hit under the provision of Section 28 of Contract Act. In support of his above contention he referred reported judgments, 1992 SCMR 1174 and 2004 MLD Karachi

662. Further contended that neither in legal notice nor in petition and even in instant appeal the illness of parents has not been mentioned. Next contended that in instant appeal the appellant did not challenge the order/judgment with regard to workman. Therefore appeal is not competent.

4. In appointment letter Clause 13 states that no legal proceedings will be entertained outside Karachi. Further states that law suit, if any against the company must be proceeded at Karachi. The learned counsel for appellant contended that such condition is not permissible under section 28 of Contract Act. Section 28 of Contract Act is very clear which negate the contention of learned counsel for appellant and the same is reproduced as under:

"Agreement in restraint of legal proceedings void.

Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract by the usual legal proceedings in the ordinary tribunals which limits the time within which he may thus enforce his rights, is void to that extent." This provision also provides two exception which relates to an agreement with regard to arbitration. In above quoted Section word 'absolutely' is very clear which in ordinary sense means unconditionally/ unquestionably. In other words complete restraining a person to avail legal proceedings. It is clear in Clause 13 of appointment letter that any legal proceedings must be initiated only in Karachi did not debar a person absolutely to avail legal remedy.

5. Generally it is settled principle of law that in suit based on breach of contract a part of the cause of action arises at the place where the contract is entered into. An agreement specifying the place where the terms of the contract were to be carried out, in other words were according to the facts stated in the agreement the cause of action was to be deemed to arise cannot be held to be illegal. It is further cleared in settled principle of law that wherein a contract entered into between two parties the cause of action partly arises in one place and partly in the contract that in case of any dispute arising out of the contract it shall be litigated only wherein the jurisdiction of one particular court and here the courts in both places have jurisdiction such an agreement is valid one and enforceable under the law and the parties are bound by it.

6. With regard to above contention, the honorable Supreme Court of Pakistan in a reported judgment in 1992 SCMR 1174 held as under:

"To wriggle out of this agreement, the learned counsel for the appellant placed reliance on section 28 of the Contract Act which provides that every agreement in restraint of legal proceedings is void. We have minutely read the said provision of law and could not find anything therein to restrain the parties from entering into an agreement to get their disputes decided by a particular Court of competent jurisdiction for their convenience and avoidance of unnecessary objections to the territorial jurisdiction of Courts. The intention behind the said provision of law is that all those agreement which restrain a person to enforce his rights under a contract by usual legal proceedings in the ordinary tribunals are void. It obviously implies that a party cannot be restrained to enforce his right in ordinary Court of law but if by mutual agreement between the parties a particular Court having territorial and pecuniary jurisdiction is selected for the determination of their disputes, there appears to be nothing wrong or illegal in it or opposed to public policy." Further honorable High Court of Karachi on same analogy in a reported judgment in 2004 MLD 662 hand, "Contract Act (IX of 1872)

S. 28

Civil Procedure Code (V of 1908), S.20 & O.VII, R.10

Territorrial jurisdiction of Court

Suit between principle and agent instituted at place "K"

Agency agreement between parties was made at place "R", which was also place of their business

Parties through such agreement had agreed that in case of any dispute, only Court at place "R" would have jurisdiction to deal with same

Parties were required to abide by terms of the their agreement and submitted their dispute to Courts at place "R"

Plaint was returned for its presentation before the proper Court."

7. Admittedly the respondents are residing at Karachi, the agreement of service was executed there and service of appellant/ applicant was also terminated at Karachi which resulted in the accrual of the cause of action. If cause of action arises at the principal office as well as at the subordinate office and parties enter into an agreement and by consent conferred jurisdiction on the particular court in order to avoid the unnecessary raising of objection to jurisdiction. The same will not be either against the public policy or violation of section 28 of Contract Act. In this particular case, the cause of action exclusively arisen at Karachi and Clause 13 of the agreement of service where the parties agreed to the jurisdiction of Civil Court at Karachi is not void. Even otherwise when the law requires a thing to be done in a particular manner than that thing must be done in that manner or not at all.

8. The next contention of learned counsel for appellant/applicant that after first appointment when he was promoted no fresh agreement was executed. Therefore the previous agreement is not applicable after promotion, but in this regard no law or authority has been referred by learned counsel. However from perusal of promotion order dated 1-3-2004 it reveals in Para No. 2 as under:

"You will charge the travelling allowances according to your new designation effective from the said date, whereas all other terms and conditions will remain the same as mentioned in your appointment letter." Further in transfer letter dated 6-5-2013 in the end the same has been incorporated as under:

"All others terms and conditions will remain the same as mentioned in your appointment letter"

9. The learned counsel for appellant objected that the learned Presiding Officer wrongly applied Order VII, Rule 10, C.P.C. for the reason that the matter fall within the preview of Labour Law. This objection is also not sustainable for the reason that according to designation appellant/applicant did not make a case with regard to worker/workman. Further, firstly he was appointed as Territory Manager and secondly, promoted as Area Manager which itself shows that the appellant/applicant having a status of managing/supervisory cadre. Even otherwise by nature of his work as a sales agent prima facie does not fall within the category of worker/workman.

10. Further the learned counsel for appellant/applicant did not point out any other illegality and irregularity in order impugned. In the circumstances, as discussed, and what has been said and done above, I am of the considered opinion that this appeal merits failure and accordingly dismissed, upholding the impugned order, with no order as to cost. The Learned Presiding Officer is directed to return/handover the application under section 41 of BIRA, 2010 along with annexed documents (in original) to the appellant/applicant for presentation to a Civil Court at Karachi having jurisdiction forthwith.

11. The copy of order along with original record of trail Court be sent to trial Court. Case after completion be consigned to record. SA/1/BLT.