HAJI ABDULLA HAJI CASSUM Vs. GEORGE REGINALD STAMP

JUDGEMENT

(1.) The plaintiffs tiled this suit against the defendant, the Senior Member of Lloyd's Underwriters, London, on a policy of March 24, 1920. The Policy contained the following clause:-- It is mutually agreed that in accordance with the aforesaid regulations the benefit of this Policy and the right to receive or endorse over claims thereon may be passed, whether before or after claim by endorsement, and that such endorsees or the bearer of the Policy, if endorsed in blank, on production of this Policy shall have power to receive and give receipts for or to endorse or assign over, as provided by the said Regulations, any claim thereon All disputes must be referred to England for settlement, and no legal proceedings shall be taken to enforce any claim except in England, whore the underwriters are alone domiciled and carry on business.

(2.) The defendant took out a summons on December 8, 1922, for an order under the Indian Arbitration Act IX of 1899 that all proceedings should be stayed. The summons was heard before Mr. Justice Kemp on September 18, 1923. The question argued before him was whether this clause in the Policy amounted to a submission to arbitration within the moaning of those words in Section 4 of the Indian Arbitration Act. The learned Judge relying upon the decision in Austrian Lloyd Steamship Company V/s. Gresham, Life Assuramce Society [1903] 1 K.B. 249 held that there was a submission to arbitration, and in consequence made the summons absolute with costs.

(3.) The plaintiffs have now appealed. They rely mainly on the contention that the wording in Clause 9 of the Policy differs from the clause in the agreement in Austrian-Lloyd Steamship Company's case. But though the wording may be different, it is clear that in both the agreements the intention of the parties was that in the event of a claim under the agreement not being settled, it should be decided by the Courts of a particular country. In Austrian Lloyd Steamship Company's Case it was held that the parties mutually agreed that, if any dispute arose under the contract, it should be determined by the Courts in Budapest, and that having regard to the nature and language of the contract, the Court was of opinion that that was a submission of any dispute arising under the contract to the Courts of Budapest, and came within the meaning of a submission to arbitration in Section 4 of the Arbitration Act, 1889 (52 & 53 Vic. c. 49). It is also clear, under the previous decisions, which wore referred to in the course of the argument in that case, that since the passing of the Common Law Procedure Act of 1854, such an agreement has always been considered as a submission to arbitration. The question may arise whether the agreement in suit was an agreement whereby any party thereto was restricted absolutely from enforcing his right under or in respect of the agreement by the usual legal proceedings in the ordinary tribunals. But I doubt very much whether an agreement of this nature which merely contracts that one of the two Courts, which would have jurisdiction to try any dispute arising under the agreement, should try such dispute, would come within the meaning of Section 28 of the Indian Contract Act. It does not make very much material difference in this case, because clearly if there has been no ouster, Section 28 does not apply, and if the agreement can be construed as amounting to an ouster, still under the decisions to which I have referred, the first Exception to Section 28 would become applicable, and in consequence the suit would be stayed. If Clause 9 in the agreement did not amount either to a reference to arbitration, or to an absolute ouster, then the defendant would be entitled to have the suit set down for dismissal. But it is in the interest of the plaintiff to have the buit stayed, so that after the proceedings in the English Courts are finished, they may take such action in this case as they may be advised. The appeal, therefore, must be dismissed with costs. Shah, J. I agree.