P L D 2023 Lahore 601 (PLP)

[18] As I observed in Ivany v. Financiere Telco Inc., [2011] O.J. No. 4162, 2011 ONSC 2785, the proper definition of the term "cause of action" is somewhat elusive even though lawyers and judges routinely use it. Halsbury's Laws of England, 5th ed., vol. 11 (London: LexisNexis, 2008), at para. 21, explains: 'Cause of action "has been defined as meaning simply the facts the existence of which entitles one person to obtain from the court a remedy against another person. The phrase has been held from the earliest time to include every fact which is necessary to be proved to entitle the claimant to succeed, and every fact which the defendant would have a right to dispute." Cause of action "has also been taken to mean that particular act on the part of the defendant which gives the claimant his cause of complaint, or the subject matter or grievance founding the claim, not merely the technical cause of action. The same facts or the same transaction or event may give rise to more than one effective cause of action." (Internal footnotes omitted) [19] Note the two expressions used in this excerpt: "cause of action" and "technical cause of action". These identify the two senses in which lawyers and judges use the term "cause of action". Sometimes they are speaking of a factual matrix, that is, the factual cause of the plaintiff's complaint. At other times, however, lawyers and judges use the term "cause of action" to identify the legal nature of the claim; recognized causes of action in this legal sense include, for example, breach of contract, negligence, breach of fiduciary duty and so on, each of which has its own constituent elements. (Emphasis supplied) The Court thus made the distinction between the claim on the one hand and cause of action on the other by holding cause of action as the factual matrix and claim being the legal basis upon which relief is based.

18. The claim must, however, be distinguished from relief which relates to the form of remedy a person seeks from the court. Relief or remedy is the means through which the cause of action is effectuated and the wrong is redressed (see Balbir Singh v. Atma Ram AIR 1977 Allahabad 211). Generally speaking, there are four types of reliefs available in a civil action i.e. declaratory remedy, equitable relief, restitution, recovery and financial damages. Relief, it may be stated, does not form part of the cause of action.

19. The rule prevents the plaintiff from splitting the claims and the reliefs which are based on the same cause of action with the aim that a single cause should not be segregated among several suits. The objective appears to safeguard against the defendant being vexed twice in respect of the same cause of action underpinning the claim. In case of omission to sue or intentional relinquishment of a claim, the rule places a bar on bringing a subsequent action in regard thereto. Similarly, the rule compels a plaintiff to sue for all reliefs arising from the same cause of action and in case of his omission to do so he shall be barred from that relief in a subsequent suit except where he took the leave from the court.

20. The Supreme Court in Hashim Khan v. National Bank of Pakistan PLD 2001 SC 325 described the claim/relief splitting rule on the following terms.

9. The reading of the said provision in very clear terms discloses that omission or failure to include any of the reliefs operates as relinquishment of such claim, it is essential that party instituting proceedings should include all reliefs flowing out of main grievance, otherwise omission would be fatal, as such, it would be essential for the plaintiff to assert claimable reliefs concerning the grievance of cause of action. However, if any such relief which flows out of basic grievance is not claimed or omitted, then such party stands precluded from agitating those reliefs subsequently. The main object of the above provisions is to avoid splitting of claim and restrict multiplicity of litigation in the matter. (Emphasis added) This excerpt captures the essence of and in fact endorses what has been discussed above regarding the difference between claim and cause of action. It is worth noting that the Supreme Court being cognizant of the true import of the rule on purpose avoided the expression cause of action rather the term main grievance or basic grievance was employed. The judgment explicitly states that any omission to sue for relief emanating from the main/basic grievance in the first suit would bar a second suit subsequently.

21. While interpreting Rule 2 of Order II, C.P.C., the Indian Supreme Court in the case of Virgo Industries (Eng.) (P) Ltd. v. Venturetech Solutions (P) Ltd. 2013 (1) SCC 625 held as follows: 9. ...It is, therefore, clear from a conjoint reading of the provisions of Order 2, Rules 2(2) and (3), C.P.C. that the aforesaid two sub-rules of Order 2, Rule 2 contemplate two different situations, viz., where a plaintiff omits or relinquishes a part of a claim which he is entitled to make and, secondly, where the plaintiff omits or relinquishes one out of the several reliefs that he could have claimed in the suit. It is only in the latter situations where the plaintiff can file a subsequent suit seeking the relief omitted in the earlier suit proved that at the time of omission to claim the particular relief he had obtained leave of the court in the first suit.

22. Similarly, in the case of V. Kalyanswamy (D) By Lrs. and another v. L. Bakthavatsalam (D) By Lrs. and others 2020(3) RCR (Civil) 404, the Indian Supreme Court made the following important observations. The difference between Order 2, Rule 2 (2) and Order 2, Rule (3) of the C.P.C. may be noticed. The law contemplates a distinction between a case where a claim arising out of the cause of action is either intentionally relinquished or omitted to be sued upon. Such a claim cannot be the subject matter of a fresh suit. However, when more than one reliefs are available stemming from the same cause of action, then, seeking further reliefs than sought in the first suit, except where leave is obtained, would be barred. However, present the grant of leave by the court, his subsequent suit seeking the reliefs which were originally not sought but for which leave is granted, is permissible. The principle of this provision is actually captured in Order 2, Rule 2 (1) of the C.P.C. which is that every suit is to include the whole of the claim which arises out of the cause of action and which the plaintiff is entitled to make. It further declares that it is open to a plaintiff to omit any portion of the claim. However, the consequences of the same are declared in Order 2, Rule 2 (2) of the C.P.C. (Emphasis supplied)

23. In the case of Secor v. Sturgis I6 N. Y. 548, the principle was stated by the Court of Appeal as follows: The principle is settled beyond dispute that a judgment concludes the rights of parties in respect of the cause of action stated in the pleadings on which it is rendered, whether the suit embraced the whole or only part of the demand constituting the cause of action. It results from this principle, and the rule is fully established, that an entire claim, arising either upon a contract or from a wrong, cannot be divided and made the subject of several suits; and if several suits be brought for different parts of such a claim, the pendency of the first be pleaded in abatement of the others, and a judgment on merits in either will be available as a bar in the other suits.

24. Barrow v. Bankside Agency Ltd. [1996] 1 W.L.R. 257 was a case in which negligent underwriting was in issue. Barrow being the member of an action group had successfully sued a number of members' agent and recovered a portion of the damages. Barrow subsequently initiated fresh proceedings against his members' agent on a different ground. The English Court of Appeal held as under: The rule in Henderson v. Henderson (1843) 3 Hare 100 is very well known. It requires the parties, when a matter becomes the subject of litigation between them in a court of competent jurisdiction, to bring their whole case before the court so that all aspects of it may be finally decided (subject, of course, to any appeal) once and for all. In the absence of special circumstances, the parties cannot return to the court to advance arguments, claims or defences which they could have put forward for decision on the first occasion but failed to raise. The rule is not based on the doctrine of res judicata in a narrow sense, nor even on any strict doctrine of issue or cause of action estoppel. It is a rule of public policy based on the desirability, in the general interest as well as that of the parties themselves, that litigation should not drag on for ever and that a defendant should not be oppressed by successive suits when one would do. That is the abuse at which the rule is directed.

25. The principle underlying Order II, C.P.C. cannot be properly grasped without considering the principle of joinder of parties and joinder of causes of actions. The two suits filed by the petitioners involved joinder of plaintiffs and defendants. The provisions of Order I Rules 1 and 3 provide guidelines for who may be joined as plaintiffs and defendants. Rule 1 of Order I states that all persons may be joined as plaintiff in one suit in whom any right to relief in respect of, or arising out of, the same act or transaction or series of acts or transactions is alleged to exist, whether jointly, severally or in the alternative. The provision also specifies the test for such joinder to the effect that if separate suits were brought by such persons, any common question of law or fact would arise. Rule 3 is a similar provision regarding the joinder of defendants. Order II Rule 3 permits for joinder of causes of actions by a plaintiff in the same suit against the same defendant or the same defendants jointly. Order II Rule 4 qualifies the scope of joinder of causes of actions concerning recovery of immovable property by making leave of court as a necessary pre-condition. There are, however, certain exceptions to the rule one of which is where claim in which the relief sought is based on the same cause of action. These provisions illustrate that two or more causes of action and remedies may now be secured in a single action and by extension making it permissible for joinder of parties. The rule of joinder of parties and causes of actions informs that any narrow interpretation limiting the scope of cause of action to a single legal claim may limit or even prevent the effective operation of these provisions.

26. It can thus be seen that the Code provides a fairly liberal regime for joinder of parties and causes of action. The Code made these provisions not on account of any problem relating to pleading rather what was aimed at was that all the matters at issue between the parties or set of parties should be settled as shortly and speedily as possible through one action.

27. It was contended before the Supreme Court in the case of Mian Muhammad Iqbal v. Mir Mukhtar Hussain and others 1996 SCMR 1047 that the cause of action in the earlier suit for specific performance was different from the cause of action alleged in the subsequent suit relating to compensation for improvement. The contention of the petitioner was not accepted and it was held that The cause of action in both the suits, namely, one for the specific performance of agreement to sell and the other for compensation of improvement could be joined in one suit and having omitted the latter cause of action, the bar of Order II, rule 2, C.P.C. was fully attracted to the case. The Supreme Court thus liberally construed the rule in order that the judgment may decide all related issues of controversy related to a claim to avoid unnecessary multiplicity of litigation for due administration of justice.

28. The Courts have applied various tests for the application of the rule against splitting of claims by stating that the evidence in the two suits must be identical or that there must be the same findings and judgment involved or that there must be a single right violated. The Privy Council in the case of Mohammad Khalil v. Mahbub Ali AIR 1949 PC 78 held that the test for determining what separates the cause of action in two suits is to see whether the same evidence will maintain both actions. These tests may be suggestive but cannot be treated as conclusive for the reason, as has been stated by Charles E. Clark in "Joinder and Splitting of Causes of Action" [Michigan Law Review, Vol. 25, No. 4 (Feb., 1927)], that "the search for an automatic rule of thumb is illusory as in law generally, particularly procedural law. Such tests as identity of the evidence, or of the right involved, are not true, if applied in the ordinary sense of the terms, since the rule applies even though the suggested requisites do not exist." This proposition is exemplified by Abdul Hakim and 2 others v. Saadullah Khan and others PLD 1970 SC 63 in which the Supreme Court came exactly to the same conclusion by holding that the only issue to be resolved under this rule is to see whether the claim/relief has been split or not. It was stated as under. ...... A rough test, although not a conclusive one is to see whether the same evidence will sustain both suits which would be the case if both the suits are founded on continuous and inseparable incidents in the same transaction. The question, however, is to be examined in substance and not merely on form as the cause of action in the two suits may be found to be the same, in spite of the facts alleged not being exactly identical in the two cases. It is not open to the plaintiff to split up the parts really constituting the same cause of action and file different suits in respect of them. In other words, a plaintiff must ask for all his reliefs which flow from the grievance caused to him by the infringement of his rights by the defendant in the course of the same transaction .. (Emphasis Added)

29. Having laid down the foundation of the rule against claim/relief splitting, we may now turn our attention towards the two suits filed by the petitioners to judge what was the claim made, the right alleged and whether the facts stated therein constituted the same claim or the cause of action. It may be reiterated that surrender deed was registered on 13.08.1999 whereas the deed of family was registered on 08.08.1991. The first suit was filed on 12.05.2016 to seek a declaration on the basis of inheritance regarding the plots situated in Mustafa Town, Lahore together with the prayer that the surrender deed executed in favour of respondent No.2 be declared to be void and invalid. The fact that the petitioners mentioned the deed of family settlement and accepted its veracity in the first suit is of no importance to the resolution of the issue involved in this case. The acceptance of the deed of family settlement by the mothers of the petitioners in the suit filed by Mrs. Farkhnada Anwar is also of no avail to the respondents. These facts may constitute estoppel by pleading or estoppel by conduct, but it shall have no decisive effect on the outcome of this case in so far as the bar contained in Order II Rule 2 is concerned. This Court also considers it irrelevant to accord any importance to the fact that the mothers of the petitioners in their lifetime did not lay a challenge to the two registered instruments. Of significance for this Court are the claims made by the petitioners in the two suits regarding the estate of Mian Muhammad Sharif and right of their mothers to share in the properties left behind by the deceased and denial of that right by respondent No.2 and other legal representatives. The claim asserted in both the suits related to right of inheritance and the wrong committed in particular by respondent No.2 in denying that right and the legal consequences flowing therefrom which constituted the causes of action in the two suits. It is a settled principle as set forth in the afore-noted Canadian case that "The same facts or the same transaction or event may give rise to more than one effective cause of action." That is why the Supreme Court in Abdul Hakim and 2 others v. Saadullah Khan and others PLD 1970 SC 63 suggested that the issue be approached by looking at the substance of the transaction and not on form of the suits for the reason that violation of same right on different occasions may give rise to separate causes and similarly the act constituting the wrong may give rise to several causes. In substance, the subject matter of both the suits related to the right of inheritance and according to the petitioners the surrender deed and the deed of family settlement were successive violations of that right. On the principles discussed above, the violations allegedly committed by the respondents in denying the right of inheritance gave rise to a single claim or cause of action and that is how the facts stated in the two suits must be construed.

30. As noted above, the petitioners cause for grievance arose in respect of denial of share their mothers were entitled to from the inheritance of Mian Muhammad Sharif. The deed of family settlement and the surrender deed were both in existence at the time of institution of the first suit. The accrual of cause of action to the petitioners in respect of the deed of family settlement at the time of institution of the first suit is thus undeniable. This cause of action granted a right to the petitioners to impugn the deed of family settlement in the first suit. In fact, as noted above, the petitioners in the second suit stated that the cause of action arose at the time of death of Mian Muhammad Sharif. The petitioners were thus under a legal duty to have sued for the entire claim arising from the same set of facts in the first suit. The matter also falls under the second limb of the rule against relief splitting. The petitioners also sought relief of declaration in both the suits qua the two registered instruments. The petitioners could very well seek the relief of declaration in respect of the deed of family settlement at the time of institution of the first suit. Their omission to do so was fatal to the second suit filed by them. There is yet another aspect of the matter. The two suits joined the petitioners as plaintiffs and the respondents as defendants on account of the right of relief the petitioners had against the respondents. This right to relief was clearly in respect of the estate left behind by Muhammad Sharif and thus it was mandatory for the petitioners to have sought the relief against both the deed of family settlement and surrender deed in one suit.

31. The petitioners as per the contents of the plaints of the two suits were aggrieved by both the registered instruments and were obliged by the terms of the rule to bring the whole claim before the court and yet they omitted to sue on the deed of family settlement in the first suit or intentionally relinquished it. Either way, their second suit comes within the mischief of Order II Rule

2. The principle embodied in Order II Rule 2 directs that the plaintiff has no right to maintain two separate actions involving the same subject matter in the same court and against the same defendant. It puts a bar on a party from bringing claims arising from the same set of facts in successive suits. In other words, a party cannot split up the claim and bring only a portion thereof before the court on which relief is sought and leave the rest to be prosecuted in a subsequent suit. The petitioners violated the mandatory rule and thus the bar on the second suit by the terms of Order II Rule 2 is applicable to the facts of the present case.

32. The petitioners' next submission was that the decision in the prior suit is a necessary pre-condition for the applicability of the rule against claim splitting. The judgments in the cases of Rasul Khan v. Qalandar Din and 4 others 1988 CLC 323 and Mahndi v. Muhammad Ramzan and 3 others 1994 MLD 686 were cited as precedents supporting this proposition. It was also contended that the rule of splitting of claims is essentially akin to or can be treated as a variation of the principle of constructive res judicata which would necessarily require adjudication on merits of the earlier suit. Neither of the propositions are true.

33. Section 11 embodies the principle of res judicata which provision assumes decision on merits in the former suit as per its explanation I. The text of Order II Rule 2, however, does not command the decision in the first suit. The precedents cited by the petitioners also do not support such principle. The case of Rasul Khan simply reiterated the principle that if the previous suit was found to be defective or incompetent and was dismissed as such it shall not bar the plaintiff from bringing the second suit. On the facts of the case, the Court in Rasul Khan concluded that the second suit was based on an entirely different cause of action. Furthermore, the cases (AIR 1925 Lahore 459 and AIR 1930 Lahore 634) on which reliance was placed in the case of Rasul Khan simply restated that where the relief under the law could not be granted in first suit it shall be no bar for a second suit and that where the causes of action are different in both the suits the principle of claim splitting shall not apply in the subsequent suit. The judgment in Mahndi's case was similarly based on authorities (mentioned at page 689) in which it was held that the dismissal of the earlier suits for declaration and permanent injunction on the ground that the plaintiff was not in possession and that no relief for possession was sought was no bar on the subsequent suit. The judgments in the cases of Rasul Khan and Mahndi do not lay down an absolute rule that a decision on merits in the previous suit is mandatory for attracting the mischief of Order II Rule 2.

34. The Indian Supreme Court in Messrs Virgo Industries (Eng.) Pvt. Ltd. v. Messrs Venturetch Solutions Pvt. Ltd. (2013) SC 290 took a similar view that a final decision in the first suit is not a necessary pre-condition for invoking the provisions of Order II, Rule 2, C.P.C. The relevant excerpt of the judgment reads as under: The learned Single Judge of the High Court had considered, and very rightly, to be bound to follow an earlier Division Bench order in the case of R.Vimalchand and M.Ratanchand v. Ramalingam, T. Srinivasalu and T. Venkatesaperumal (supra) [reported as (2002) 3 MLJ 177] holding that the provisions of Order II, Rule 2, of the C.P.C. would be applicable only when the first suit is disposed of. As in the present case the second set of suits were filed during the pendency of the earlier suits, it was held, on the ratio of the aforesaid decision of the Division Bench of the High Court, that the provisions of Order II, Rule 2(3) will not be attracted. Judicial discipline required the learned Single Judge of the High Court to come to the aforesaid conclusion. However, we are unable to agree with the same in view of the object behind the enactment of the provisions of Order II, Rule 2 of the C.P.C. as already discussed by us, namely, that Order II, Rule 2 of the C.P.C. seeks to avoid multiplicity of litigations on same cause of action. If that is the true object of the law, on which we do not entertain any doubt, the same would not stand fully subserved by holding that the provisions of Order II, Rule 2 of the C.P.C. will apply only if the first suit is disposed of and not in a situation where the second suit has been filed during the pendency of the first suit. Rather, Order II, Rule 2 of the C.P.C. will apply to both the aforesaid situations. Though direct judicial pronouncements on the issue are somewhat scarce, we find that a similar view had been taken in a decision of the High Court at Allahabad in Murti v. Bhola Ram[7] [relevant citation is (1894) ILR 16 All 165] and by the Bombay High Court in Krishnaji v. Raghunath[8] [relevant citation is AIR 1954 BOM 125]. (Emphasis Added) The facts of Abdul Hakim 's case decided by the Supreme Court also shows that the second suit was filed during the pendency of the first suit.

35. The authorities from American jurisdiction also provide useful insight on the issue as the claim splitting doctrine in that jurisdiction is identical to the one contained in the Code. In Adams v. California Dep't of Health Servs. 487 F.3d 684, 688- 689, the US Court of Appeal for Ninth Circuit clarified that: .in assessing whether the second action is duplicative of the first, we examine whether the causes of action and relief sought, as well as the parties or privies to the action, are the same. The Court affirmed dismissal of second suit for claim-splitting while first suit was still pending. Similarly, the US Court of Appeal for Tenth Circuit in Hartsel Springs Ranch of Colorado, Inc. v. Bluegreen, 296 F.3d 982 (10th Cir. 2002), looked directly at the issue of whether a final judgment on the merits in the first suit was required. Id. at 987 n.

1. It was held as under: It is clear that a motion to dismiss based on improper claim splitting need not - indeed, often cannot wait until the first suit reaches final judgment, (citations omitted) . . . [I]n the claim-splitting context, the appropriate inquiry is whether, assuming that the first suit were already final, the second suit could be precluded pursuant to claim preclusion. (Emphasis added) The US Court of Appeal for Tenth Circuit in Katz v. Gerardi 655 F.3d 1212, 1219 stated that If the party challenging a second suit on the basis of claim splitting had to wait until the first suit was final, the rule would be meaningless. Likewise, the US Court of Appeal for Eleventh Circuit in Vanover v. NCO Fin. Servs., Inc., 857 F.3d 833, 840 n.3 held that The 'claim splitting doctrine' applies where a second suit has been filed before the first suit has reached a final judgment." These rules state the correct position of law and are squarely applicable to a case coming under the mischief of Order II Rule 2 of the Code.

36. The rule against claim splitting is not synonymous with the doctrine of res judicata although the two rules serve some of the same policies. The intent and scope of the principle of res judicata was explained by Muhammad Saleem Ullah and others v. Additional District Judge, Gujranwala and others PLD 2005 SC 511 on the following terms.

7. The rule of res judicata is based on the consideration that same cause should not be tried for the second time between the same parties and there must be an end to the litigation between the parties. The principle is that since the cause of action in a suit merges in the judgment, therefore, no second suit can be filed on the basis of same cause of action unless it is shown that it was recurring in nature, thus, the essential condition required to be fulfilled to establish the plea of res judicata would be that the matter in issue and the material point in dispute between the parties in the earlier litigation was directly and substantially in issue in the subsequent litigation. This is settled law that if matter in issue in the subsequent litigation was not substantially decided in the earlier litigation, it would not be res judicata actually or constructively because for res judicata, it is essential to show that earlier decision in the matter was based on proper adjudication on the relevant issue either of law or fact or mixed issue of law and fact. In simple terms the principle of res judicata states that where there is a judgment inter partes a fresh suit on the same subject matter shall be barred. The principle contained in Order II Rule 2 by contrast simply bars the second suit in case the plaintiff omitted or relinquished the claim/relief that he could seek in the first suit. Where the Code required, as in section 11, it expressly stated its intention of having a final decision in the prior proceedings. There is, therefore, a marked difference between the two principles. The rule of claim/relief splitting in its exposition and despite its subtleties does not admit of a construction requiring mandatorily a final decision on merits in the first suit.

37. The petitioners also contended that the plaint could not be rejected under Order VII, Rule 11, C.P.C. without recording evidence of the parties. In support of that proposition, it was also added that for exercise of power under that provision only the contents of the plaint must be looked at for making a determination that it discloses a cause of action and that the suit is not barred under any law. That proposition is not absolute, although it may be stated that there are grounds on which it may be supported. There is a valid exception to the rule to which I shall shortly advert to. It is clear that a determination that a suit is barred under Order II, Rule 2, C.P.C. can only translate into rejection of plaint under the provisions contained in Order VII, Rule 11, C.P.C. Respondent No.2 in the present case pleaded to claim/relief splitting rule by filing an application in which necessary facts were stated and the copy of the plaint of the first suit was appended. The petitioners in reply to that application admitted all the facts stated therein. In the circumstances, there was no need to go through the process of submission of documentary evidence after framing of an issue as all the facts pleaded in the application were accepted by the petitioners. The short answer to the submission that only the contents of the plaint can be looked at for rejecting the plaint is that it depends on the nature of the plea raised by the defendant for invoking the said provision. As is not uncommon on issues like this, there is an overabundance of authorities on both sides. And the parties hereto dutifully provided lengthy lists of cases supporting their respective stance. The only construction that can be placed on judgments deviating from the principle is that if the facts presented by the defendant are incontrovertible or admitted and clearly demonstrate that the suit is barred under some law or that the plaint does not disclose the cause of action the courts will not permit the suit to proceed to the stage of evidence thereby prolonging the agony of the parties and shall reject the plaint. This formulation is validated by the Supreme Court in the case of Jewan and others v. Federation of Pakistan and others 1994 SCMR 826 in which the principle cited by the petitioners in support of their stance was not given the central importance. While agreeing with the proposition that in rejecting plaint the court cannot consider any plea raised in the written statement it was nevertheless held that ....if there is some material before the Court apart from the plaint at that stage which is admitted by the plaintiff, the same can also be looked into and taken into consideration by the Court while rejecting the plaint under Order VII, Rule, 11, C.P.C. This is the correct exposition of the principle as the Code is generally concerned with efficiency and convenience of trial and aims at burying the case at the initial stage if it does not show cause of action or is barred by any law.

38. The respondents also pleaded to the law of limitation to contend that the second suit was time barred. This plea was not considered by the additional district judge while passing the impugned order and as such this Court is not inclined to decide upon it for the reason that the respondents did not make any challenge to the order.

39. For what has been discussed above, this Court concludes that the result yielded by the order of additional district judge was right and that the second suit instituted by the petitioners was hit by the bar contained in Order II, Rule 2 of the Code. This writ petition is accordingly dismissed. MH/K-7/L Petition dismissed.