M. GORDHANDAS Vs. D. ARVIND MILLS

JUDGEMENT

(1.) THIS is a suit filed by the plaintiffs to recover a certain money claim arising out of an agreement arrived at between the plaintiffs and defendants No. 2 acting on behalf of defendants No. 1 in or about the middle of October 1959 relating to the export of a certain quantity of art silk fabrics and the import entitlement relating thereto. It is not necessary for me to enter into the complicated facts of the present ease for the purpose of this order. In para. 6 of the plaint the plaintiffs have averred that, in the matter of the skid contract, defendants No. 2 acted on behalf of defendants No. 1, and the terms of that contract as alleged by the plaintiffs are also set out in the same paragraph of the plaint. Defendants No. 1 have, in para. 5 of their Written Statement which is in reply to para. 6 of the plaint, started with a comprehensive denial in the following words: With reference to para 6 of the plaint, these defendants deny each and every statement of submission and allegation made therein as if the same were set out herein and specifically traversed. These defendants deny that there was an agreement between the plaintiffs and the defendants as alleged in the said paragraph 6 of the plaint. These defendants say that true facts are as under: Defendants No. 1, have in para. 5, thereafter proceeded to state seriatim what, according to them, were the terms of the agreement. It may, for the sake of completeness, be mentioned that it appears that the parties are mainly at variance only in regard to the stipulation in the agreement as to the manner in which the price of the goods was to be paid to the plaintiffs. I am, however, not concerned with those terms. What is pertinent to note is that there is no specific denial in para. 5 of the Written Statement of defendants No. 1 of the express averment in para. 6 of the plaint that, in the matter of entering into the said agreement, defendants No. 2 acted for and on behalf of defendants No. 1. It is, therefore, contended on behalf of the plaintiffs that no issue in terms of issue No. 5 of the draft issues submitted by defendants No. 1 arises at all. Issue No. 5 of the said draft is in the following terms: Whether the 2nd Defendants acted for and on behalf of the let Defendants as alleged in paragraph 6 of the plaint? The contention of Mr. Desai on behalf of defendants No. 1, on the other hand, is that the comprehensive denial at the beginning of para. 5 of the Written Statement amounts to a specific denial within Order VIII, Rule 3 of the Code of Civil Procedure; that a perusal of the Written Statement along with the correspondence leaves no room for doubt that, by necessary implication, the fact of the authority of defendants No. 2 as the agents of defendants No. 1 is not admitted within the terms of Order VIII, Rule 5 of that Code; and that a denial in the form iii which it is made in para. 5 of the Written Statement is enough to justify the raising of an issue, having regard to the terms of Order XIV, Rule 1 of the Code of Civil Procedure.

(2.) THE point was argued at considerable length before me and several authorities eited, but before I turn to the authorities, I would prefer to deal first with the statutory provisions with which I am directly concerned, and then with the statement of the law on the point that is to be found in standard English works on the subject. Order VIII of the Civil Procedure Code deals with a Written Statement and Set -off, and Rule 3 of that Order lays down in unambiguous terms that it is not sufficient for a defendant in his Written Statement to deny generally the grounds alleged by the plaintiff, 'but the defendant must deal specifically with each allegation of fact of which he does not admit the truth.' There is an exception to that Rule laid down in the Rule itself to which, however, I need not refer. Rule 4 of Order VIII then proceeds to state that where a defendant denies an allegation of fact in the plaint, he must not do so evasively, but answer the point of substance; and Rule 5 of that Order enacts in mandatory terms that every allegation of fact in the plaint, if not denied specifically or by necessary implication, or stated to be not admitted in the pleading of the defendant, shall be taken to be admitted except as against a person under disability. There is then a proviso to that Rule which confers on the Court the discretion to require any fact so admitted to be proved otherwise than by such admission. Order XIV of the Code deals, inter alia, with the settlement of issues, and Rule 1 of that Order states that issues arise when a material proposition of fact or law is affirmed by the one party and 'denied' by the other. Sub -rule (3) of Rule 1 is mandatory in terms and lays down that each material proposition affirmed by one party and 'denied' by the other shall form the subject of a distinct issue. These are all the provisions of the Code of Civil Procedure with which I am concerned in this case.

(3.) TURNING next to the statement of the law on the point that is to be found in standard English works, in Odgers on Pleading and Practice, 19th edn., pp. 191 -192, it is stated that a defendant should not plead merely that he denies specifically every allegation contained in the statement of claim, but, on the other hand, he could not be expected to write out and traverse every sentence in the statement of claim. The learned author then proceeds to state that it is usually considered sufficient when dealing with matters of inducement or other allegations which do not go to the gist of the action, to plead that the defendant denies each of the allegations contained in a particular paragraph. The learned author makes it clear that when, however, the pleader comes to those allegations which are the gist of the action he should be more precise and should plead to them specifically. To the same effect are the observations in Bullen and Leake's Precedents of Pleadings, 11th edn., p. 667, where the law on the point is stated in the following terms:.It is not sufficient for a defendant in his defence 'to deny generally the grounds alleged by the Statement of Claim'; he must deny, either expressly or by necessary implication or state that he does not admit, each allegation in the Statement of Claim of which he does not admit the truth, except damages; and such denials must be specific and not vague or evasive. It is, however, only necessary to deal in this way with the main allegations which are the foundation of the action, e.g., those which assert that the parties entered into a certain contract, or that the defendant committed a certain tort. In such cases, if the terms of the contract are set out in the claim, the defendant must deny specifically each term which he disputes.... There are, however, in most Statements of Claim certain introductory averments which are known as 'matters of inducement1 -paragraphs, in other words, which are explanatory only of the facts and not essential to the cause of action. Again, there are often at the end of the Claim allegations which form no part of the main cause of action, such as the statement that 'the defendant threatens and intends to continue the nuisance complained of or 'to repeat the alleged injuries,' etc. AH these matters may be answered by the defendant by a general denial, such as, 'the defendant denies the allegations contained in paragraphs 2, 6 and 7 of the Statement of Claim and each and every of them'; and this will have the same effect as if he had separately set out each of such allegations and then specifically denied it. It is often useful to use this comprehensive form of traverse in dealing with a lengthy Statement of Claim. In my opinion, the correct position in law has been set out with admirable lucidity by Bullen & Leake in the above passage and that is why I have thought it fit to quote the same verbatim. As against the above statements of the law, reliance was placed by Mr. Desai on the statement that is to be found at p. 21 of Atkin's Court Forms (2nd edn.) Vol. 32, where, after stating the general proposition that every allegation of fact in the statement of claim must be denied specifically, the learned author has stated that it is common practice to use a traverse in the form 'the defendant denies specifically all the allegations in paragraph 2 of the Statement of Claim,' or that 'the defendant denies each and every allegation of fact in the Statement of Claim, as if the same had been set forth seriatim and specifically traversed,' and that traverses in that form are sufficient compliance with that rule. In support of that proposition, he has cited cases to which I will presently refer but, with respect to the learned author, I do not think it sets out the correct ratio of those decisions, or the true legal position which is more correctly set out in the passages from Odgers and Bullen & Leake to which I have referred above.