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BREAKING NEWS:

Arbitration clause of the agreement be tried first

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15th-Sep-2018       
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(From previous issue) :
In a case such as this we are of opinion the suit is not on the face of it barred by law. The very arguments which have been advanced in appeal show that the suit on the face of it is not barred by law, as the suit has been found to be a suit that has to be dismissed after consideration of the legal arguments. Therefore we are unable to accept this view of the learned Counsel.
16. The Calcutta High Court in the case of Sreedam Chandra Bhur vs Tencori Mukherjee reported in AIR 1953 Cal222 also held that Order VII rule 11(d) was attracted only when on the admitted facts as appearing from the plaint itself the suit was prima facie barred. The Division Bench in this connection observed as follows:-
"This clause is attracted only when on the admitted facts as appearing from the plaint itself the suit is prima facie barred. As for instance when from the statements made in the plaint it appears that the cause of action arose beyond period of limitation fixed under the statute and no indication is given that limitation has been saved, the plaint may be rejected. Even in such a case, an opportunity is to be given to the plaintiff to amend the plaint by setting out an acknowledgement in writing signed by the defendant within the period of limitation if it is so prayed, and that without passing an order for rejection of the plaint. 'Gunnaji Bhavaji vs Makanji Khoosal Chand', 34 Bom. 250. As was observed in 'Ratan Chand vs Secy. of State 18 Cal. WN 1340, action is to be taken under Order VII, rule 11 of the Code of Civil Procedure only if there is a clear and specific admission in the plaint from which it follows that the suit is barred. Reference may also be made to the observations of this Court.' Prankrishna vs Krlpannath '. 21 Cal. WN 209 held:
"Let us now consider whether on the plaint as filed the Court will be justified in rejecting. in limine the plaint under cl.(d) rule 11,  Order VII, Civil PC In the body of the pliant there is no admission for the Council of the Assembly is the Government under Section 80, Civil PC. On the other hand, it is seriously contested on behalf of the plaintiff that neither of the two bodies can even be deemed to be the government. The learned Subordinate Judge refers to his order vaguely to the Trend of French Statutes conferring greater and greater powers on the french Settlement in India and creating a 'Council du Government' there and later a cutting out Chandernagore from the Federation and conferring on Chandernagore all those powers with a separate delegate of the 'Commissionaire de la re-oblique, it is evident that the Chandernagore administration is a government in the grammatical and ordinary sense of the word though its functions may fall short  of the those of the Governments existing in India.
We do not think it necessary to refer to other points urged before us by the contending parties. Suffice it to say that the question whether even if the Code of Civil Procedure applies, whether Section 80 would be attracted or not cannot be decided merely on the plaint as it stands.
The Court should have registered the plaint, issued notices on the defendants and allowed them to file their written statements. After issues were raised it would have been open to the Court to take up one or more of the issues as preliminary ones and decide the same. Objection that had been raised by the Court 'suo-motu' and such other objection as may be raised by the defendants would have to be tried on the merits, and only after all the necessary facts and materials are brought before the Court."
17. There is no reason to differ from the above principles of law. In the instant case, there is nothing on record to show that on the admitted facts as appearing from the plaint itself the suit is prima facie barred. So the rule 11(d) is not at all attracted here and the plaint cannot be rejected on that score.
18. In the case of Sundar Ali being dead his heirs: Mannan vs Md Serajul Islam Sarker 56 DLR (AD) 210 held:
"For the ascertainment of the cause of action the Court is required to read the plaint in its entirety.
19. In the case of Abdul Malek Sawdagar vs Md Mahbubey Alam 57 DLR (AD) 18 held:
"The question whether the plaint is liable to be rejected being barred by law must be apparent from the statement made in the plaint itself and not from the written statement or any other material other than that has been put in the plaint.
20. In the case of Md Abul Khair vs Pubali Bank Ltd. 21 BLD (AD) 32 = 53 DLR (AD) 62 held:
"Where in a suit an application under Order VII, rule 11 of the Code is filed for rejecting the plaint on the ground that the averments made in the plaint do no disclose a cause of action for the suit, the Court is not called upon to decide the suit on merit on taking evidence.
It is only the averment made in the plaint which are to be considered to come to a finding as to whether those disclose a clause of action. The Court while deciding such application is not permitted in law to travel beyond the averments made in the plaint."
21. In the case of Afzal Hossain Diptee vs Radha Kanta Korati 15 BLC 196 held:
"Code of Civil Procedure
Order VII rule 11
22. On going to materials on record it transpires that the grounds urged for rejection of the plaint are absolutely the subject matter of evidence, which cannot be decided before taking evidence. On plain reading of the statements of the plaint it is evident that the same clearly discloses the cause of action, the relief claimed is not under valued, the plaint was not written upon paper insufficiently stamped and not barred by any other law. The question whether the plaint is liable to be rejected being barred by law must be apparent from the statement made in the plaint itself and not from the written statement or any other material other than that has been put in the plaint."
23. In the case of Bangladesh Water Development Board vs Contractor, Manu Barrage 9 BLT 21 = 53 DLR 200 held:
"Arbitration Act, 1940 Section 32
Whether the suit instituted in presence of the arbitration agreement is maintainable.
Held: We find no such provisions in the Act barring a suit on the ground of existence of an arbitration agreement."
24. In the case of Shafi A Chowdhury vs Pubali Bank Ltd. 54 DLR 310 held:
"Section 11 & Order VII, rule 11 of the Code.
Ordinarily, a plaint should not be rejected under Order VII, rule 11 of the Code on the ground of res judicata unless it is so palpably clear and obvious from a meaningful reading of the plaint that no further evidence is required."
25. The facts 'indicate that the plaintiff instituted the suit for realisation of arrear rents, mandatory injection and for compensation against the defendant No.1. It is pertinent to point out that the plaintiff entered into a tenancy agreement with defendant No. I on 20-2-2013. In the said agreement both the parties were agreed to dissolve their matter in dispute by Arbitration and in accordance to Arbitration Act 2001.
The terms of the clause of the agreement reads as hereunder:
"In the event of any dispute of any difference (s) arising out of the clauses of the terms and conditions mentioned therein above, such dispute of difference (s) shall be referred to the arbitration or arbitrators, one to be appointed by each Part: (Lessor and Lessee)), and a third Arbitrator/ Umpire to be appointed by the mutual consent of the Two Arbitrators so appointed by the parties. Such arbitration shall be in accordance with and subject to the provisions of the Arbitration Act, 2001 and the rules hereunder, and the awards made by the arbitrators shall be final and binding upon both the LESSOR and the LESSEE."
26. We find that the learned Advocates of both appellant and respondent No. 1 candidly submit that they are willing to dissolve the matter in dispute by Arbitration and in accordance with the Arbitration Act 2001.
27. All the facts and submissions of the learned Counsel of both the parties indicate that the plaint of the suit should not be rejected under Order VII, rule 11 (d) of the Code, where there is an arbitration clause in agreement to dissolve the dispute by Arbitration and parties are willing to go for Arbitration.
28. If sections 7 and 10 of the Arbitration Act are read together the intention of the legislature becomes clearer that once the parties to a contract agreed to settle their disputes that may arise out of execution of the contract they must be encouraged and directed to follow the procedure what they agreed to, and the Court should not proceed with any civil proceedings commenced by one party against other party in respect of any matter covered by such arbitration agreement.
29. In view of such facts the ends of justice would best to serve if we direct the plaintiff appellant and defendant respondent No. I to dissolve their dispute by Arbitration and in accordance with the Arbitration Act 2001.
30. In view of the above, the Court below without considering the materials on record and aforesaid principles of law, by rejecting the plaint of the suit committed an error of law.
Therefore, the impugned judgment and decree of the Court below is liable to be interfered by the High Court Division.     31. Moreover the impugned order in its entirety is not well founded in the facts and circumstances of the case.
So, the submissions advanced by the learned Counsel for the appellant prevails and appears to have a good deal of force.
32. In the light of discussions made above and the preponderant judicial views emerging out of the authorities referred to above, we are of the view that the impugned judgment and decree suffers from legal infirmities which calls for interference by this Court. Thus the appeal having merit succeeds.
33. In the view of foregoing narrative, the appeal is allowed. The impugned judgment and decree dated 26-9-2017 passed by learned Joint District Judge, fifth Court, Dhaka in Title Suit No. 326 of 2017 is hereby set-aside.
The learned Judge of the Court below shall direct the plaintiff and defendant No.1 to take every possible step to dissolve their matter in dispute by Arbitration and in accordance with the Arbitration Act 2001 within three months, from the date of receipt of this order and till then the further proceeding of the suit shall be stayed.
The office is directed to communicate the order at once.

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