Compromise decree

The plaintiff banks and defendant No.1 (the "Company") jointly filed compromise applications in two connected suits under Order XXIII Rule 3, C.P.C., stating that they had amicably settled their dispute through a Master Settlement Agreement and hence sought a compromise decree on the basis of the same

Validity

According to defendants 2 and 3, their earlier guarantees stood discharged the moment Master Settlement Agreement was executed by the banks

Counsel for defendants 2 and 3 had no objection to the grant of the compromise decree application in hand if it was allowed without prejudice to the rights of said defendants to agitate their plea qua discharge of their earlier guarantees and the said defendants could avail their remedies in accordance with law before the Company Bench

To this, counsel for the plaintiffs had no objection

Defendants 4 and 5 also had no objection to the grant of the compromise decree application in hand, if it was allowed without prejudice to the rights of the said defendants to agitate their factual and legal arguments at the time of hearing of their respective Leave-to-defend application

To this also, counsel for the plaintiffs had no objection

With respect to the hearing of Leave-to-defend applications filed by the defendants 2 to 5, the suits were adjourned sine die

Compromise application which was jointly filed by the plaintiffs and defendant No.1, and was also duly signed by the parties and their respective counsel, was therefore allowed, and the suit was decreed by consent against defendant No.1 on the terms mentioned in the listed compromise applications

Applications were allowed.

Office of High Court declined to convert compromise decree into execution proceedings in view of dictum laid down by Supreme Court in case titled Peer Dad v. Dad Muhammad, reported as 2009 SCMR 1268

Validity

Imposing a blanket prohibition against institution of execution proceedings for enforcement of compromise decrees without factoring individual situations or contexts would foster misconception of its efficaciousness, diminish its value, which would in turn persuade parties to shun compromises and discourage them from seeking settlements, and instead they might be inclined to lock horns in prolonged, obstinate legal battles, leading to increased strain on resources and an overburdened judiciary

Overboard generalization and an inflexible approach (by not considering individual circumstances or exceptions) which required parties to initiate new legal proceedings for every violation of a compromise decree, would deprive the decree holder of the fruits of its labour and would reduce earlier rounds of agonizing, draining and long-winded litigation (which resulted into compromise decree) into mere dress rehearsals for future litigation

This was not the intent of law nor could it be in line with the purpose of compromise decrees, it which was to settle disputes and avoid prolonged legal battles and it would also undermine the purpose of tailoring a special statute viz Financial Institutions (Recovery of Finances) Ordinance, 2001

High Court directed its office to issue notices to judgment debtors as the terms of compromise decree were executable

Office objection was overruled.

Application for preparation of decree sheet was concurrently dismissed on ground that the same was moved after lapse of 6 years without any logical reason for such delay

Held, that no limitation had been provided for drawing up such a decree sheet

Litigant did not have to remind the court/its office about its obligation to draw up a decree after announcement of judgment

Duty of Court to prepare/complete the decree sheet in line with its judgment

Punishing a party for default of the Court was not fair

Constitutional petition was allowed and Trial Court was directed to prepare/draw up the decree sheet accordingly.

Party whose application for review of a compromise decree on the ground that he had not consented was dismissed, cannot sue to set aside that decree on the same ground.

Petitioner's father after issuance of the decree had remained alive for long time but he had never challenged the same in his life time

However, after 38 years the petitioner had filed the application under S. 12(2), C.P.C., which was hopelessly time barred

Constitutional petition was dismissed.

Plaintiff filed an application for correction of order and incorporation of direction therein to deposit sale price of decreed land less the amount of Zar-e-Soam stipulating the time

Trial Court corrected the amount of sale price but refused to extend time to deposit the corrected amount

Revisional Court granted time to the plaintiff to deposit sale price

Contention of defendants was that time to deposit the decretal amount could not be extended after stipulated period

Validity

Trial Court while passing order for compromise decree neither mentioned the amount therein nor the time was fixed for deposit of sale price

Plaintiff moved application for correction of said order and price of suit land was corrected

Refusal to extend time by the Trial Court for deposit of sale price was neither justified nor sustainable in the eye of law

Trial Court had failed to fulfill its obligation by not granting time when it had made correction in the price of land

Appellate Court was justified to exercise its jurisdiction provided under the law for granting time to deposit sale price less already deposited amount of Zar-e-Soam

Court had power to extend time for deposit of sale price once good cause had been established from the record

Trial Court while making correction in the order and decree should have extended time itself already consumed for deposit of price of decreed land

Constitutional petition was dismissed, in circumstances.

General Power of Attorney was an unregistered document in which signatures of witnesses were missing and no stamp duty was paid on the same

Sale agreement had been executed on behalf of attorney in favour of defendant after death of principal

Plaintiff entered into a sale agreement with the defendant on the basis of unregistered deed of power of attorney

Sale agreement was dubious and suit was a collusive one

General power of attorney should have been registered and no sanctity was attached to unregistered attorney deed

Document which proposed to create financial or future obligation should be witnessed by at least two male witnesses

Impugned judgment and decree had been obtained through fraud and misrepresentation and legal heirs had been deprived of their valuable rights

Application for setting aside of compromise decree was allowed, in circumstances.

Petitioner assailed decree passed by Judge Family Court on the basis of compromise between the parties to the extent of maintenance fixed at the rate of Rs. 50,000/- per month with 15% annual increase

Contention of petitioner was that compromise was not signed by him and that the amount of maintenance was exorbitant

Validity

Compromise once arrived at with due deliberation and consultation was not legally challengable

Challenging the compromise partially to the extent of maintenance allowance after its submission before the court of law had no moral and legal justification

Petitioner had signed vakalatnama in favour of his counsel and on the basis of said vakalatnama his counsel had appeared as a representative/ attorney of the petitioner

Consent decree was not appealable

Appeal filed by the petitioner agitating consent decree was validly dismissed by the Appellate Court

Petitioner, in view of his admission in the guardian petition, could easily afford maintenance of Rs.50,000/- per month to support his minor daughter

Constitutional petition was dismissed.

If decree had been obtained by fraud and misrepresentation then limitation would start from the date when decree came in the knowledge of petitioner

Limitation was a mix question of law and facts and same required evidence

Trial Court would have framed issues and after recording evidence the petition was to be decided on merits

Impugned order passed by the Court below was set aside, in circumstances

Application was to be deemed to be pending before the Trial Court and to be decided after framing of issues and recording of evidence of the parties in accordance with law

Appeal was allowed, in circumstances.

Jurisdiction of civil Court would be ousted only when declaration was sought against the Custodian of Evacuee Property, however, when the dispute was of civil nature between the parties then jurisdiction of civil Court could not be claimed to have been ousted

Compromise decree had been passed on the statement of plaintiffs

Plaintiffs could not take an inconsistent position by saying that fraud had been committed

General allegation of fraud could not be accepted until the details and manner of commission of fraud was proved by the party

Appeal was dismissed, in circumstances.

Application filed for compromise of a suit had signatures of plaintiff and attorney of defendant but not of the defendant

Defendant was the owner of suit property but he had not signed the application for compromise of a suit

Impugned decree passed on the basis of an application filed under O.XXIII, R.3, C.P.C. was collusive and had been obtained through misrepresentation and fraud

Impugned order and decree passed on the application for compromise were set aside, in circumstances.

Widow of the deceased came for execution of decree of money and the decree was matured only on account of her relinquishment of share in immovable property being auctioned

If widow of deceased had not relinquished her share in property, her money decree would not have been passed as property which she relinquished was auctioned for her money decree

Consent decree was an agreement that carried sanctity of court of law and respondent could only have approached court for her due share

Respondent was required to at least offer and deposit partial amount which was required by her in part consideration of consent decree which was not found

Widow of deceased had filed execution of recovery of amount only and no alternative prayer was available on her part coupled with required deposit in order for her to claim share in auctioned property

Widow of deceased might have been entitled to her share at which property could have been sold

Division Bench of High Court set aside judgment and decree passed by Single Judge of High Court as the widow on acquisition of partial monetary benefit could not claim subsequent benefit / share in property, i.e., both halves

High Court appeal was allowed accordingly.

Limitation did bar the remedy or assistance of the Court and it did not extinguish the right or title if accrued under the decree

Decree-holder had filed execution petition for enforcement of compromise decree after more than five years which was time barred

No bar existed against judgment-debtor either to file objection and/or initiate execution proceedings if decree passed so permitted

Once limitation had started it could not be stopped

First execution petition should be filed within a period of three years from passing of a decree

Mutation in favour of decree-holder on the basis of a decree could be effected even if execution petition was barred by time

Impugned orders passed by the Courts below were in accordance with law

Constitutional petition was dismissed, in circumstances.

Suit for recovery of maintenance was decreed in favour of respondent against petitioner who were divorced husband and wife

Matter was settled between the parties against a sum of Rs.150,000/- as full and final settlement of maintenance amount which amount was to be paid within 3 months but petitioner failed to comply with said conditions, resultantly Executing Court directed petitioner to pay maintenance allowance

Validity

Conditional compromise was a one-time window for petitioner (father) to once and for all wriggle out of his responsibilities, particularly towards his minor daughter

Father could not shirk off his responsibilities towards minor and mother could not have agreed on her behalf allowing father to do so

Even if conditional compromise was to be followed/implemented, petitioner (father) could only blame himself for not making requisite payment within stipulated period of 03 months

Such time period was fixed with consent of parties and they knew well what they were agreeing to in terms of timeline

Parties could not be allowed to wriggle out of same more so, for the reason that matter was being governed by Family Courts Act, 1964

High Court declined to interfere in the matter

Constitutional petition was dismissed in circumstances.

Decree-holder did not file execution petition but decree was satisfied by Nazir of the Court and report was submitted before the Court

Validity

Application for satisfaction of decree was filed before Nazir of the Court by the counsel who was not authorized by the decree-holder

Power of attorney should have been obtained from the decree-holder and application should have been filed for satisfaction of decree through Nazir after satisfying the Executing Court as to why judgment-debtor had failed to satisfy the compromise decree

Executing Court was to apprise of the circumstances in which judgment-debtor i.e. plaintiff's real brothers and sisters had failed to fulfil their promise when they were living with the plaintiff

Nazir had acted without jurisdiction and on the willful and mala fide persuasion of counsel; had unlawfully executed sale-deed of suit property which was liable to be cancelled and declared as unlawful and was not supposed to act as judicial officer/presiding Judge of Executing Court to entertain application for satisfaction of decree and satisfy the same and at his own send a report to the Court for order of satisfaction of decree in the disposed of suit

If anything was lawful but it had been done unlawfully then it would become unlawful

Illegality committed by Nazir could not be allowed to perpetuate rather it was the duty of the Court to direct him to reverse the consequence of illegalities committed by him as an officer of the court

Decree-holder was issued show-cause notice as to why sale-deed executed by Nazir of the Court without lawful authority should not be cancelled

Nazir was directed to collect original registered sale-deed executed by him from the plaintiff and no further transaction was to be allowed to the plaintiff

Additional Registrar (O.S) was directed to hold inquiry with regard to execution of sale deeds by the Nazir on the basis of compromise decrees from January 2014 till date in the cases in which present counsel had obtained compromise decrees and without filing an execution petition same were satisfied by the Nazir.

Respondents had sought the execution of order passed by the Appellate Court and not the judgment and decree passed by the Trial Court

Appellate Court while disposing of the appeal did not pass any decree

Respondents could apply to the Appellate Court to pass a decree in the terms of the compromise between the parties

Once a decree was passed then Executing Court could continue with the execution proceedings

Judgment and decree passed by the Trial Court had been replaced through compromise between the parties

Order passed by the Appellate Court recording the compromise between the parties had not been assailed by the applicants

Respondents could not be compelled to institute a fresh suit for enforcement of terms and conditions of the compromise

Revision was dismissed in circumstances.

Plaintiff and defendant made settlement through compromise that properties mentioned in the compromise deed would be transferred in favour of plaintiff

Plaintiff moved execution petition wherein surety submitted objection petition but same was dismissed

Contention of surety was that decree was passed with regard to the properties which were not subject matter of the suit and he was not bound to satisfy the decree

Validity

Decree was passed on the basis of compromise with regard to properties which were not subject matter of the suit

Said decree could not be executed against the surety

Surety never consented for satisfaction of decree regarding the properties which were not subject matter of the suit

Suit was not decided on merits

Parties had agreed that if properties mentioned in the compromise deed were not transferred in favour of decree-holder then decretal amount would be recovered after auction of the properties

Surety was not bound to satisfy the decree of the Court passed on the basis of compromise deed when he was not privy to the contract of compromise

When terms were settled between the parties to the suit through a compromise then surety would be discharged

Findings recorded by the Courts below were nullity in the eye of law

Impugned orders passed by the Courts below were set aside

Revision was allowed in circumstances.

Petition for correction of sale deed was moved which was accepted with the direction to the Revenue Official to delete Khasra number incorporated in the sale deed

Validity

No Khasra number of suit land was mentioned either in the agreement to sell or plaint and decree in favour of plaintiff

Agreement to sell was with regard to shops jointly owned by the defendants

Decree for specific performance of part of suit property was passed without specification of boundaries as well as mentioning the area of said property

Sale deed was registered without ensuring that it was in accordance with the judgment passed by the Trial Court

Limitation could not be a hurdle in the way of dispensation of justice when a wrong had been done by the Court

Petitioner for invoking constitutional jurisdiction was bound to show some jurisdictional defect committed by the courts below

No such defect had been pointed out in the orders passed by the courts below

Constitutional petition was dismissed in circumstances.

Lawful order passed in the result of compromise was not open to appeal or revision.

Neither any application for summoning the case file from the diary of 18-11-1973 was filed nor any order existed that case filed was summoned on the request of either of the parties for adjudication on the basis of compromise

However on 14-11-1972 statement of special attorney for defendants was recorded and compromise decree was passed

Held, trial court should have framed issue and record evidence qua the authenticity of power of attorney and statement recorded with regard to compromise

Inquiry should have been made as to why record was summoned on 14-11-1972

Impugned judgments passed by the courts below were set aside and case was remanded for decision afresh

Constitutional petition was allowed in circumstances.

Contention of applicant was that suit was dismissed on the basis of a compromise and no decree was passed to be executed

Validity

Parties to the suit had entered into an agreement settling their dispute in terms thereof

Suit was dismissed in the light of compromise deed

No decree was passed on the basis of said compromise deed; had there any such decree been passed, even then same could be termed as a contract between the parties

Breach of said compromise (contract) would give cause of action to the aggrieved party to approach the court to seek remedy in terms thereof

Trial Court while proceeding with execution petition had erred in law and committed an irregularity

Impugned order was set aside

Respondents would be at liberty to institute a separate suit for redressal of their grievance, if any, arising out of alleged non-compliance of compromise deed

Appeal was allowed in circumstances.

Courts were supposed not to make rule of court any compromise or award which contained any material beyond the subject matter of the suit

Trial Court had illegally made the alleged compromise as rule of court, which had caused miscarriage of justice

Compromise filed in the suit was cancelled and decree passed on the basis of same was set aside

Execution proceedings were set aside and execution petition was dismissed

Case was remanded to the Trial Court with the direction to resume trial proceedings on the suit from the stage prior to filing of alleged compromise

Revision was allowed accordingly.

Suit for recovery of bank loan was decreed on the basis of compromise between the parties deciding shares to be received by two financial institutions out of the assets of defendants/customers

During execution of decree, plaintiff/bank intended to change share ratio in its favour by decreasing that of other financial institution

Single Judge of High Court dismissed the application filed by plaintiff bank

Validity

Plaintiff bank could not enlarge its share in the security having recourse to S. 58 of Transfer of Property Act, 1882, or for that matter contents of BPD Circular No.29 issued by State Bank of Pakistan, on 15-10-2002

Legal rights for settlement of over-dues was over-ridden by the conduct of parties inter se following the compromise, which had taken into account provisions of law and contents of the Circular

Compromise created a mechanism for modifying rights of parties which were to be decided to be modified on basis of certain existing contents

Modified rights were enumerated in settlement application sanctioned by Banking Court with the consent of parties

Recourse of the provisions of law and BPD Circular No.29 was superseded by arrangement made between the parties

Payment of amount by defendants / customers to plaintiff/bank in pursuance of settlement application and order passed by Banking Court had created rights in parties including defendants / customers and other financial institution in relation to sharing ratio in security

Any modification of such sharing ratio was to have occurred by consent of parties and not unilaterally

Enhancing share of plaintiff/bank of sharing ratio of other financial institution was illegal and against defendants/customers

Division Bench of High Court declined to interfere in order passed by Single Judge of High Court

Appeal was dismissed in circumstances.

Impugned decree was unambiguously an expression of the adjudication which had conclusively determined the rights of the parties in the suit

Objection petition had raised matters which were neither expressed in the decree nor could be construed as part thereof

Executing Court could neither modify nor take into consideration documents or the agreement which was not reflected or incorporated in the decree

Petitioner had not exercised his right to assail the decree by preferring an appeal

Both the Trial Court and Appellate Court had correctly appreciated the facts and law in the present case

Findings recorded by the courts below were in accordance with law and well reasoned

Revision was dismissed in circumstances.

Applicant had neither been personally served in the suit nor she had knowledge about its pendency and she had never given any power-of-attorney to the alleged attorney

Impugned judgment and decree passed on the basis of compromise was the result of fraud and misrepresentation and same was rightly set aside by the courts below

Respondent had failed to point out any illegality or irregularity in the concurrent findings of the courts below which had neither exercised jurisdiction not vested in them nor had failed to exercise jurisdiction so vested nor had acted illegally or with material irregularity

Judgments and decrees of both the courts below were well-founded and needed no interference by the High Court

Revision was dismissed in limine.

Applicant had no locus standi to file application under S.12(2), C.P.C. when a decree had been passed against a person who was alive and had not challenged the same in any proceedings before any forum

Revision was dismissed.

S. 101-Compromise decree-Defendant undertook to pay money by instalments-Failure to pay instalment-Defendant should prove that default was not theirs' and they took all proper and reasonable steps to make payment.