Cases with No Defendants: Summary Suits (Order 37 CPC)
Introduction: Civil suits before the city civil courts are generally associated with long-standing battle before the court involving hefty procedures of rejoinder, admission/denial of documents, the framing of issues by courts, vexatious defences of defendants which ultimately leading to final judgment or decree. These tidy procedures though necessary for justice however sometimes seem unnecessary in simple cases of debtor-creditor dispute where a fixed amount is sought to be recovered which is in nature of debt and is evident by written documents. Order 37 CPC is best suited for cases in which a Defendant does not have a case at all and the Suit is prolonged for years and in cases, where loans are taken from Banks and borrowers disappear with no trace,
In the ordinary suits, it is commonly seen that defendants cause unreasonable obstruction through claiming of untenable and frivolous defences even when they hold no ground for the same merely in order to delay the judgment and prolong litigation. Therefore, in order to prevent the same in cases of commercial transactions, special provisions exist in the Civil Procedure Code (CPC) under Order 37.
ORDER XXXVII OF CODE OF CIVIL PROCEDURE, 1908 – The code under this laydown court and classes of suit to which the order shall apply in the following manner:
The circumstance in which summary suit can be filed – As stated above provisions of the summary suit is made for commercial transactions and therefore only the following matter qualifies for summary proceedings:
i. Dispute concerning bills of exchange, Hundies (written document directing payment of a certain amount) and promissory notes or
ii. Suits for recovery of debt or demand for a fixed amount to be payable by the defendant.
The above claim should arise either from a written document or under an enactment (except penalty) or from a guarantee in respect of the debt. In the claim under summary suits two essentials elements are (i) Written document/contract/enactment/guarantee – It means that written evidence is mandatory to advance the claim. However, as the provision is a welfare mechanism therefore a wide scope is given to the term and courts even accept invoices/bills as written contracts for this purpose. (ii) Liquidated demand – The term liquidated demand here means a fixed or specified amount should exist to be recovered from the defendant in order to advance the suit under this provision i.e. claim of the amount should not be based upon the discretionary assessment of court.
Court for a summary suit – The courts where a summary suit can be filed are:
i. The High Courts or
ii. The City Civil Courts or
iii. The Courts of Small causes or
iv. Other Courts as notified by respective HC’s through notification.
Procedure to be followed/ Summary Proceedings –
i. When a suit under Order 37 is filed by the plaintiff then the defendant is required to be served with a copy of case documents and summons by court.
ii. The defendant should present himself/ through advocate before the court within 10 days of sending the summon, otherwise he/she will waive away their right to defend.
iii. If the defendant appears before the court within the 10 days period then the plaintiff will serve on the defendant a summon for judgment and within 10 days of same, he/she has to apply for leave to defend the suit. The leave to defend in the suit is granted to the defendant by the court depending upon certain principles.*
iv. However, if the defendant fails to apply for leave or does not present himself before the court within 10 days of serving summon or his leave to defend is rejected by the court for any reason then in such cases plaintiff gets legally entitled to the relief claimed by him through the judgment without any exception.
Principles* used by Court to allow leave to defend – Various positions of Court where leave to defend is generally granted has been summarized in the landmark judgment of Sunil Enterprises & Anr. V SBI Commercial & International Bank Ltd. where it was observed that:
a) If the defendant satisfies the Court that he has a good defence to the claim on merits, the defendant is entitled to unconditional leave to defend or
b) If the defendant raises a triable issue indicating that he has a fair or bona fide or reasonable defence, then the defendant is entitled to unconditional leave to defend or
c) If the defendant discloses such facts as may be deemed sufficient to entitle him to defend then leave is granted.
If the defendant has no defence, or if the defence is sham or illusory or practically moonshine, the defendant is not entitled to leave. In such cases of sham defences the court may show mercy to the defendant by enabling him to try to prove a defence but at the same time protect the plaintiff by imposing the condition that the amount claimed by the plaintiff should be paid into Court or otherwise secured. However, if the court allows the contention of the defendant to defend then the suit will proceed as an ordinary suit and decree will be granted as per general provisions of CPC.
Relief for the defendant - In CPC under Rule 13 of Order IX which deals with setting aside the ex parte decree. The defendant has to satisfy the court that the summons was not duly served or he was prevented by any sufficient cause from appearing in the hearing along with the facts which would entitle him to leave to defend. The SC in Inderjeet Kaur vs Nirpal Singh warned that cautious and judicious approach plus balanced view in respect of competing claims is necessary. It further stated that at a stage when leave to defend is sought, it is enough if defendant prima facie makes out a case by disclosing such facts as would disentitle the other side from claiming an order. It would not be a right approach to say that unless the Defendant at that stage itself establishes a strong case, he should be granted leave.
Conclusion - Generally, the Courts are usually reluctant to grant leave to defend in summary suits especially an unconditional one. This is perhaps because the balance of convenience is usually in favour of the Plaintiff and the Courts are also aware of the delay caused in deciding a Civil Suit. However, if special circumstances or sufficient cause is proved by the defendant then an exemption can be made in favour of the defendant.
ABOUT THE AUTHOR:
Jayant Upadhyay is a 4th Year student of BA.LLB course currently studying in K.L.E. Society’s law college, Bangalore. As he writes this post, Jayant is interning with us.
You can contact him at https://www.linkedin.com/in/jayant-upadhyay-731856131/
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