1992 PLP 876 (SCMR)

SALEEM AKHTAR, J.‑‑‑Leave to appeal was granted to consider the question whether the authority of the Advocate is strictly restricted by law to deal with matter, even in respect of compromise to the subject‑matter of the proceedings and nothing beyond. The appeal arises from the following facts as stated in the order granting leave: "The dispute in this case pertains to house No.1738/14, Federal `B' Area, Karachi. Learned counsel for the petitioner states that the present petition arises out of the following facts. Respondent No.2, who is the husband of the petitioner, appears to have transferred the house in favour of respondent No.1 representing it to be his property. The house is admittedly in the exclusive possession of the petitioner who claims to be the real owner thereof. The respondents Nos.1 and 2 are alleged by the petitioner to be on intimate terms. Respondent No.1 instituted Suit No.208/84 on the original side of the Sindh High Court against respondent No.2 for recovery of possession of the house in question and means profits from 11th March, 1984, at the rate of Rs. 100 per day, which suit according to the petitioner was collusive one. In this suit as petitioner was not impleaded as a party, she applied under Order I, rule 10, C.P.C. to be joined as a party/defendant. However, by a compromise between the respondents on 6th May, 1984, behind the back of the petitioner and without notice to her respondent No.2 confessed judgment whereby the suit was decreed in terms of the compromise directing respondent No.2 to hand over possession to respondent No.1 on or before 10th August, 1984, and to pay mesne profits to respondent No.1 at the rate of Rs.75 per day from 10th March, 1984, until the delivery of vacant possession. This decree was passed on 6th May, 1984, on which date simultaneously the application of the petitioner. under Order I rule 10, C.P.C. was dismissed. The petitioner then submitted C.MA. 1331/84, under section 12(2), C.P.C. and Order XXI, rule 95, C.P.C. seeking to challenge the decree as having been obtained by means of collusion and fraud by the respondents. She also submitted C.M.A. 246/1985 for stay of execution in the meantime. By order dated 24th March 1985, both C.M.As. were dismissed by learned Single Judge vide order dated 24th March, 1985. Being aggrieved petitioner filed High Court Appeal No.40/1985, against the aforesaid orders. This appeal was allowed by the Division Bench of the Sindh High Court with the result that the case was remanded for disposal of C.MA. 1331/1984 and C.MA. 246/1985 for decision and disposal afresh vide judgment dated 24th February, 1986. It is pertinent to reproduce the following direction given by the Court: In view of this order, the direction to the appellant to hand over the possession to the respondent No.1 will remain stayed till the disposal of the applications of the appellant mentioned above. In the meantime on 19th October, 1988, pending the disposal of the aforesaid C.MA. respondent No.1 moved the Court for a direction to the petitioner to deposit mesne profits, although the petitioner was not a party to the suit in which the decree was passed (C.MA.1331/1988). This application was dismissed by a learned Single Judge in Chambers as misconceived on 30th January, 1989. By order dated 16th February, 1989, however, learned Single Judge, dismissed C.MA. No.246/1985 filed by the petitioner for stay of execution, until the decision of her application under section 12(2), C.P.C. The case was then fixed for evidence of the petitioner in respect of the application under section 12(2). Being aggrieved by the aforesaid order dated 16th February, 1989, petitioner filed High Court: Appeal No.44/1989. On 11th December, 1989, the Division Bench of the High Court recorded the joint statement of the advocates for the parties in the aforesaid H.CA. No.44/1989 as under: `Joint statement of the parties' Advocates This appeal may be disposed in the following terms: (a) The appellant will deposit in Court a sum of Rs.2,000 per month with effect from the date of institution of the appeal i.e. 3‑1‑1989 subject to result of the application under section 12(2), C.P.C. (b) The appellant will examine her evidence and close her side within four months. (c) There will be no order as to costs, Karachi (Sd.) Syed Inayat Ali, Dated: 11‑12‑1989 Advocate for Appellant. (Sd.) Badrudduja Khan, Advocate for Respondent No.1. The amount will be deposited in Court within two months and the appellant will continue to deposit the future amount at the same rate every month. (Sd.) Syed Inayat Ali, Advocate for Appellant (Sd.) Badrudduja Khan, Advocate for Respondent No.1. The appeal was accordingly disposed of in terms of the statement. The case of the petitioner is that the aforesaid statement by her counsel was filed without her authority and/or/instructions. Accordingly after she became aware of this fact she filed C.MA. 156/1990, under section 151, C.P.C., praying for recalling of order, dated 11th December, 1_989, and in the meantime for staying the operation thereof. The learned Judges of the Division Bench took the view that as the Wakalatnama executed by the petitioner in favour of her advocate expressly conferred the power of compromise on her advocate, he was competent to make the compromise statement impugned by her. On this reasoning the learned Judges of the Division Bench dismissed petitioner's C.M. No.156/1990 (vide order, dated 18th February, 1990).

2. The main facts relevant for consideration of the appeal are that the Advocate who made a statement reproduced above was engaged by the appellant, he had the authority to compromise the case, he was engaged to conduct both the applications namely application filed under section 12(2) and application for stay of the execution. Mr. Badrudduja Khan, the learned counsel for the respondent No.1 has pointed out that the appellant and respondent No.2 being husband and wife are in collusion and the proceedings have been initiated to frustrate the decree passed m his favour. He further pointed out that at the time when both the applications namely application for stay and application under section 12(2) were heard but as the appellant was not in a position to examine the witnesses and respondent No.1 was pressing for disposal of the stay application which was being delayed, a consent order was passed which protected the interest of the respondent No.1 who had obtained a decree for mesne profits and possession both. Mr. Muhammad Shareel, the learned counsel for the appellant, contended that as the subject- matter of appeal was the dismissal of C.M.A. No.246 of 1985 in which the appellant had sought stay of execution of decree dispossessing her from the house in dispute even the expressed authority conferred by Wakaltnama to compromise did not extend beyond the scope of the appeal so as to bind her with the consent in respect of payment of mesne profits. In this regard reliance has been placed on Sheonandan Prasad v. Hakim Abdul AIR 1935 Privy Council

119. It was observed as follows:‑‑

"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 O.23, rule 3, should not make a decree." The Advocate having power to compromise can enter into a settlement with regard to the subject‑matter of the suit in respect of which authority has been given. He cannot introduce any alien matter or any collateral subject in such settlement or compromise. The same view was also taken in Surendra Shankar Walker v. L.S. Walker, and others AIR 1960 Bom. 20, where relying on AIR 1923 PC 98 and AIR 1930 PC 158, it was observed that: "the authority of an advocate to compromise is implicit in the appointment of the Advocate unless it is expressly countermanded by the client." It was also observed that: "The implied authority of an Advocate to enter into a compromise is limited to the action in which he has been engaged and does not extend to matters which are extraneous to the action or which are merely collateral to it." This observation refers to the extent of the implied authority but the question is that where an express authority has been given to the Advocate can he enter into a compromise with regard to matters collateral to the main controversy. According to Mr. Shreef, the learned ASC for the appellant the decree for mesne profit was not against the appellant and it could not have been recovered from her. However, according to Mr. Badrudduja, the learned counsel for the respondent No.1, the execution proceedings had been stayed and, therefore, both the questions were linked together. The Division Bench by its judgment dated 24‑2‑1986 had stayed the execution proceeding till the decision of both the applications viz. application under section 12(2), C.P.C. and application for stay. Therefore, the order dismissing the stay application on 16‑2‑1989 was completely in contravention of the judgment passed by the learned Judges of the Division Bench. So long both the applications were not decided the stay of the execution proceeding was to continue. Considering the controversy in this background although the stay application,, had been dismissed, the order passed by the Division Bench on 24‑2‑1986 remained in operation as it contemplated the dismissal of both the `applications' and not any one of the applications. Furthermore the respondent's application against the appellant for deposit of mesne profits had been dismissed as misconceived. In this background no reasonable person would offer to incur financial liabilities when it could not have been imposed upon him. Therefore, the question of recovery of mesne profit from the appellant in the peculiar circumstances of this case was a collateral subject to the main controversy between the appellant and respondent No.1. If the facts, circumstances and orders referred above would have been considered and made known to the appellant in the normal course she would not have agreed or instructed to enter into such a compromise: There is nothing on record that the appellant had instructed specifically to enter into such a compromise. The compromise was on the basis of the general authority given in .the Wakalatnama which was extended to the collateral subject.

3. In the case of Sheonandan Parsad Singh the Privy Council had relied on the following observation made in Swinfen v. Lord Chemsford 5H + N890 = 2 LT 406, which is the leading authority of that country:‑‑ "The other complaint made in the first count is that the defendant agreed on the plaintiff's behalf, that the estate should be given up and a conveyance of it be executed by the plaintiff. As to this, the plaintiff has always contended that the defendant had no authority or power to make such an agreement, that it was not binding, and that the agreement was a nullity, and we are of opinion that, although, a counsel has complete authority over the suit, the mode of conducting, it and all that is incident 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 collateral to it. For instance, we think, in an action for a nuisance between the owners of adjoining land ‑ however, desirable it may be that litigation should cease by one of the parties purchasing the property of the other we think the counsel have no authority to agree to such a sale and bind the parties to the suit without their consent, and certainly not contrary to their instructions, and we think such an agreement would be void." This observation was followed in Sourendra Nath Mitra v. Srimati Tranhala Dasi (1930) 46 TLR 191 = AIR 1930 PC 158 and many other cases. In Halsbury's Laws of England, 3rd Volume, Fourth Edition in para. 1.180 it has been observed:‑‑-- "A judgment obtained by consent of counsel in Court, in a matter within counsel's authority, cannot form the subject of an appeal. If with his client's authority and consent, counsel agrees to an order, and there is no mistake or surprise, the client cannot arbitrarily withdraw his consent, but if counsel subsequently informs the Court that he agreed under misapprehension, the Court will not hold him or his client to the agreement, and if counsel agrees contrary to his client's clear instructions, the Court will not hold the client to the agreement.' Further in paragraph 1181 it reads as follows:‑‑ "The authority of counsel to compromise is limited to the issue in the action: a compromise 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."

4. Where a general power to compromise is given to the Advocate in a pending case, he has the authority to settle the dispute of that case and such settlement will be binding on the party. However, such authority will not authorize the Advocate to compromise dispute which is not subject‑matter of the case or is collaterally involved in it unless specific authority in that regard has been given. A client can resile from a compromise or consent given by an Advocate under mistake, misrepresentation by the other side or in contravention of an order passed by the Court or instructions given by him. In. case where minor and Pardanashin ladies are concerned Courts have to give due protection to them and the authority to compromise given by them to their Advocates must be closely and minutely scrutinized to avoid any deception or misuse of such authority.

5. We are, therefore, of the view that the statement seems to have been made inadvertently, without considering the facts and circumstances of the case and without any specific authority from appellant in respect of matter which in the peculiar facts of this case was collatoral to the main controversy between the appellant and respondent No.1. Such undertaking, therefore, cannot be allowed to be continued. We have viewed with concern that although the Division Bench had expressed its desire to get the applications disposed of expeditiously the same have remained pending. While setting aside the impugned judgment we expect that the High Court will dispose of both the applications as directed by order, dated 24‑2‑1986.

6. The appeal is allowed with no order as to costs. M.BA./N‑302/S Appeal allowed.