ANUJEE et al. v. LEWIS et al

098-NLR-NLR-V-41-ANUJEE-et-al.-v.-LEWIS-et-al.pdf


392
Anujee v. Lewis.
1940
Present: Soertsz and Nihill JJ.ANUJEE et al. v. LEWIS et al.
It} the Matter of an Application for a Writ ofProhibition.
Company—Jurisdiction to wind up Bank—Powers of District Court—CourtsOrdinance, s. 62?— Writ of prohibition:
A District Court has jurisdiction by virtue of section 62 of the CourtsOrdinance to entertain proceedings for the winding up of a BankingCompany not registered in Ceylon.
HIS was an application for a writ of prohibition against the District
A Judge of Jaffna, prohibiting him from proceeding further with thecompulsory winding up of the Tranvancore and Quilon National Bank.
It was contended on behalf of the petitioners that the District Court ofJaffna had no jurisdiction to wind up a bank that has not been incor-porated by registration under the provisions of Ordinance- No. 4 of 1861and Ordinance No. 2 of 1897.r,
N. E. Weerasooria, K.C. (with- him E. B. Wikremanayake and J. A. T.Perera), for the petitioners.—A District Court in Ceylon has no jurisdictionto wind up the bank in question. The bank is not registered in Ceylon ;it is incorporated and registered in Quilon, in the Native State of Travan-core. In our law there is provision for the winding-up of only suchcompanies as come under Ordinance No. 4 of 1861 or Ordinance No. 2
Jurisdiction must necessarily be expressly conferred upon a Court.There is no statutory provision which confers jurisdiction on our Courtsregarding companies which are not registered in Ceylon. In re LloydGenerate Italiano 1 is a relevant English case which was decided at a timewhen the law in England was similar to that which governs the presentcase. See also 8 Halsbury f2nd ed.) page 530, para. 1173, and pag° 533,para. 1179 summarizing the position.
When an inferior Court is exceeding its jurisdiction, a superior Court isbound to grant a writ of prohibition—The Mayor and Aldermen of theCity of London v. Cox et al.'; Worthington v. Jeffries3; Farquharson v.Morgan'.
1 (1885) 29 Ch. D. 219.■' (1875) 10 C. P. 379.
* 0867) 2 H. L. 239 at 234, 277 et seq.' (1894) 1 Q. B. 552.
T
of 1897.
Anujee v. Lewis.
393
H. V. Perera, K.C. (with him T. K. Curtis and C. C. Rasa Ratnam), forfirst respondent.—It is not disputed that the Bank, though a foreigncompany, is resident in Jaffna. A company is subject to the laws of theland. When a company which can sue and be sued and is thus givenlegal recognition in Ceylon enters into contracts and disappears, it cannotbe said that our Courts are powerless to do anything with the propertyleft behind. It can be wound-up—In re Commercial Bank of India '.Section 62 of the Courts Ordinance (Cap. 6) deals with the jurisdiction ofvarious courts in the larger sense of the word, and section 63, with thecivil jurisdiction of a District Court. The whole of the residuary juris-diction with regard to civil matters is thus conferred on the District Courts.The District Court has unlimited and plenary jurisdiction in civil mattersand cannot be compared to an inferior Court in England—Thevagnane-sekeram v. KupparumalThe conferring of a power implies the conferringof everything that is necessary for the regulation of that power. Theprocess of winding-up is merely a matter of procedure. The CivilProcedure Code does not provide for every contingency that may arise.The Court has, under these. circumstances, inherent power to order awinding-up—Hukm Chand Boid v. Kamalanand Singh
Section 3 of Cap. 66 read with section 18 of the Interpretation Ordinance(Cap. 2) is large enough to embrace a matter of this-kind, and Englishlaw would be applicable in relation to all joint stock companies, whetherforeign or local. A foreign company registered abroad, is not denied aseparate existence, and an unregistered foreign company can be woundup—Bateman v. ServiceRussian and English Bank et al. v. BaringBrothers & Co., Ltd.1; Palmer’s Company Law (16th ed.) p. 461.
N. Nadarajah, for second, third, and fourth respondents.
N. E. Weerasooria, K.C., in reply.—“Civil matter” in section 62 ofCap. 6 is too wide a term to embrace a subject of a special nature likewinding-up proceedings. If it is to be given such an extensive meaning,section 69 of the same Ordinance (Cap. 6) which was introduced by way ofamendment in 1904 as the result of a decision of the Supreme Courtwould be an unnecessary provision in relation to lunatics, idiots, &c.Section 4 of the Insolvency Ordinance (Cap. 82) expressly conferringjurisdiction on the District Court would also be superfluous. It has beenheld that all matters regarding insolvency proceedings are of a specialnature—In re Goonewardene *. Section 62 of Cap. 6 cannot, therefore,be construed so as to confer residuary jurisdiction on the District Court.The District Court is not in the position of a Superior Court—In the matterof the Application of John Ferguson for a Writ of Prohibition against theDistrict Judge of Colombo 7; In the matter of Daisy Fernando 8. Sections 6,7, and 42 of the Courts Ordinance are conclusive on this point. See also8 Halsbury (2nd ed.) pp. 527-531, paras. 1168-1175.
The expression “ the law to be administered ” in section 3 of Cap. 66refers to substantive law only and not to questions of procedure. WhereEnglish procedure is adopted, it would be on terms similar to those of
1 (1868)6 Eg. C. 617.3(1936)164 L. T. Rep. 602.
1 (1934)36 ,v. L. R. 337.•4 C. L. Rer. 215.
3 /. L. R. (1905) 33 Cal. 927 at 930.7(1874)1 N. L. R. 181.
* (1881)6 A. C. 386.‘U896)2 N. L. R. 249.
394SOSRTSZ J.—Aniljee v. Lewis.
section 100 of the Trusts Ordinance (Cap. 72). In Straits Settlements,an enactment similar to Cap. 66 was passed but the Privy Councilheld that although, under that enactment, the mercantile law of Englandwas introduced, the Moneylenders’ Act of England would not be appli-cable—Abdullah Bajerai v. Sockalingam Chettiar '. Winding-up pro-ceedings are of a special nature. Even assuming that a District Courtis a superior Court, special legislation would be necessary on a matterwhich is of a special nature. In England, special legislation was passedconferring jurisdiction on the High Court regarding winding-up proceedings—8 Halsbury (2nd ed.) paras. 1278, 1284 ; Sections 338, 163, &c., of theCompanies Act. Even in regard to the High Court, only particular Judgesappointed by the Chancellor have power to wind up—section 164 (l)ofthe Companies Act. It is impossible, therefore, to import into CeylonEnglish procedure.
Cur. adv. vult.
March 6, 1940. Soertsz J.—
The three petitioners, whose petitions have been submitted to us forconsideration, are decree-holders against the Travancore National andQuilon Bank, Limited. They make their petitions to ask us to exercisethe jurisdiction conferred on us by section 42 of the Courts Ordinance,and issue a writ against the District Judge of Jaffna prohibiting him fromproceeding further with the compulsory winding-up of that Bank on whichhe has been engaged in Case No. L/2 of his Court, initiated at the instanceof the second, third, and fourth respondents. The first, respondent isthe Official Liquidator.
The petitioners’ case is that the District Court of Jaffna usurped ajurisdiction that was never given to District Courts in this Island, whenit addressed itself to the winding-up of a Bank that has not obtainedincorporation by registration under the provisions of Ordinance No. 4 of!861 and Ordinance No. 2 of IP-97, but is a Bank incorporated by regis-tration.in Quilon in the Native State of Travancore in South India.
If we are satisfied that District Courts ns constituted by our laws haveno jurisdiction to wind up companies other than those incorporated byregistration in Ceylon, -for the winding-up of which provision ^ made bythe Joint Stock Company Ordinance, we are at once face to face with acase of a patent lack of jurisdiction, and we are bound ex dcbito justitia?to grant the writ applied for regardless of the motives of the petitioner'sor their delay in preferring their petition. Questions of motive anddelay may have an important bearing in cases in which there has beenencroachment by one Court on the jurisdiction apportioned to anotherCourt of the same class and not in cases in which there has been a manifestusurpation of jurisdiction. This fact emerges clearly in the judgment ofBrett J. in the case of Worthington v. Jeffries ’ and in the judgments of .Lord Halsbury and Lopes L.J. in Farquharson v. Morgan*. I indulgein these observations only because Counsel for the respondents commentedstrongly on the motives and the delay imputable to the petitioners.
l IIHSZ) 1/9 Jj T~~*1/871) IOC. I’.S79.'
* US9A) I Q. B. D. 552.
395
SOERTSZ J.—Anujee v. Lewis.
The sole question, then, that we have to answer is whether the petitionershave made out their case that in the matter of the winding-up of com-panies, District Courts have jurisdiction only by virtue of the JointStock Company Ordinance and only so -far as companies falling within theprovisions of that Ordinance are concerned. In regard to this question,the submission made to us by petitioners’ Counsel in the course of theable and learned arguments he addressed to us may be summarized asfollows : Ordinance No. 4 of 1861 provides in Part IV. for the winding-up of companies registered under that Ordinance and of no other com-panies, by the District Court having jurisdiction in the district in whichthe registered office of the company in question is situate. (See sections67 and 68.) Banking and Insurance-Companies, were not within thatOrdinance (see section 3) till it came about that the passing of OrdinanceNo. 2 of 1897 brought Banks registered under that Ordinance within thepurview of Ordinance No. 4 1861 in so far as the provisions of thatOrdinance were not inconsistent with its own provisions (see section 2 ofOrdinance No. 2 of 1897). The Bank with which we are here*5bncernedis not a bank registered by virtue of Ordinance No. 2 of 1897, and, there-fore, the provisions of Part IV. Ordinance No. 4 of 1861 do not applyto it, and such jurisdiction as was conferred by sections 67 and 68 onDistrict Courts in regard to winding-up proceedings does not extend to acase such as this, that is to say, to a case of the winding-up of a Bankregistered abroad. The conclusion reached by this line of reasoning isthat a company or Bank registered abroad cannot be wound up inCeylon. It will be observed that this submission of the petitioners isbased on a major premise that jurisdiction is conferred on DistrictCourts in regard to the winding-up of companies by sections 67 and 68of Ordinance No. 4 of 1861 and that apart from those sections DistrictCourts have no jurisdiction. The validity of this submission musttherefore necessarily depend upon the validity of that premise. Is thepremise valid ? To answer that question, we must examine the Ordinancethat provides for the establishment of our Courts and defines their powers,that is to say, the Courts and their Powers Ordinance. (Vol. I., Cap.6 of Leg. Enactments of Ceylon.) Section 3 of that enactment says that“ the Courts for the ordinary administration of justice, civil and criminal,within this Island shall continue as heretofore to be as follows:.—
The Supreme Court;
District Court;
Court of Requests;
Magistrate’s Court; ”
The proviso appended to this section leaves unaffected certain jurisdic-tions created by Imperial Statute or by certain local Ordinances, but withthem we are not at all concerned in this case.
The matter of the winding-up of companies is undoubtedly a matterarising in the course of the ordinary administration of justice in a country,and, I think, it must be assumed that it is, at least, antecedently pro-bable that provision will be made in such an Ordinance as the Courts andtheir Powers Ordinance for some Court or other to have jurisdiction oversuch a matter. The question, then, is whether the words used in the
396
SOERTSZ J.—Anujee v. Lewis.
Ordinance in conferring and apportioning jurisdiction on and amongvarious Courts have or have not resulted in the realization of that apriori probability.
It is conceded that a winding-up proceeding is not within any originalCivil jurisdiction of the Supreme Court. It, obviously, is not withinthe jurisdiction of Courts of Requests, or of Magistrates’ Courts. It,therefore, follows that it must be within the jurisdiction of DistrictCourts or must be regarded as an unfortunate casus omissus, unfortunate,because it is deplorable that local Courts should have no jurisdiction towind up companies which, though not registered here, have largely livedand moved and had their being here. In other countries, in Englandfor instance, certain Courts are empowered to wind up foreign andcolonial companies having assets and liabilities there—In re MercantileBank of Australia 1 ; North Australia Co. u. Goldsborough Co.1. The newlocal Companies Ordinance, No. 51 of 1938, makes provisions in Part X.for the compulsory winding-*up of unregistered companies. Have we,then, heretofore occupied an exceptional position? I think the answerto that question must be found in chapter VI. of the Courts and theirPowers Ordinance, and does not depend upon whether District Courtsare superior or inferior Courts of Record, I refer to this because there wasa great deal of argument on the point, and if it were necessary to findwhether a District Court is a superior or inferior Court of Record, Ishould” have no difficulty in holding that it is not a superior Court in thesense in which that term is understood in English Jurisprudence. Thatwas the view taken in “ In the matter of the application of John Fergusonfor a Prohibition against the District Judge of Colombo ", a ruling by aCollective Court.
Section 62 of chapter VI. of the Courts and their powers Ordinance is inthese terms: “ Every District Court shall be a Court of Record and shallhave original jurisdiction in all civil, criminal, revenue, matrimonial,insolvency and testamentary matters, save and except such of the afore-said matters as are herein, or by virtue of the said Criminal ProcedureCode or any other enactment for the time being in force, exclusivelyassigned by way of original jurisdiction to the Supreme Court, and shallalso have jurisdiction over the persons and estates of lunatics, minors,and wards, over the estates of cestuis que trust, and over guardians andtrustees, and in any other matter in which jurisdiction has heretoforebeen, is now or may hereafter be given to District Courts by law ”. Iread these words as meaning that when all the powers given to the Sup-reme Court are put on one side the entire residuary original jurisdictionin regard to all civil, criminal, revenue …. matters is vested inDistrict Courts. Now, in my opinion, a “ winding-up ” proceeding is acivil matter and falls within that jurisdiction. This view is, I thinksupported and not controverted by sections 67 and 68 of Ordinance No. 4of 1861 on which reliance was placed. Section 68 says : “ The expression‘ the Court ’ as used in this Ordinance shall mean the District Courthaving jurisdiction in the place in which the registered office of the com-pany is situate; and any Court to which jurisdiction is given by this
* (1892) 2 Ch 204.-2 61 L. T. 710.
3 1 N. L. R. 1S1.
SOERTSZ J.—Anujee v. Lewis.
307
Ordinance shall, in addition to its ordinary powers, have the same powerof enforcing any orders made by it in pursuance of this Ordinance as ithas in relation to other matters within the jurisdiction of such CourtrespectivelyIt will be observed that in the first part of this section
it is said the word “ Court ” shall be taken to mean the District Courthaving jurisdiction in the place in which the registered office of the Com-pany is situate ”. The words “ having jurisdiction ” must mean in thecontext, already possessed of a jurisdiction that comprises the relevantjurisdiction, namely, the jurisdiction to wind up for on the occasion onwhich the draftsman is using his words, it is not at all to the point that theCourt he envisages has every other kind of jurisdiction if it has no juris-diction to take steps to wind up a company. He is concerned, at thatpoint of time, 'with winding-up proceedings, and with nothing else, andwhen he uses the words “ having jurisdiction ” he must be understood tomean jurisdiction to wind up. The words having jurisdiction are, by nomeans, apt if the intention of the draftsman is to confer a new jurisdiction.The later words “ and any Court to which jurisdiction is given by thisOrdinance ” create no difficulty, for when he uses those words, thedraftsman is clearly referring to the exclusive jurisdiction given by theOrdinance to that District Court within the limits of which the registeredoffice is situate. In other words; the draftsman when confronted witha number of Courts that may be said to have jurisdiction on the usualgrounds on which jurisdiction is conferred, namely, residence of the parties,situation of property, the arising of the cause of action, &c., ignores themall and selects the Court within the limits of which the registered officeis situate as the Court that shall function in winding-up proceedings.In the concluding part of section 68, the draftsman goes on to say that theCourt singled out, because it is the Court within whose limits the registeredoffice is situate, shall, in addition to its ordinary powers, have the powerto enforce any orders made in the course of the winding-up. The con-tention of the petitioners’ Counsel might, have appeared to be stronger ifsection 68 of Ordinance No. 4 of 1861 had been worded in the manner ofsection 161 of the new Companies Ordinance, No. 51 of 1938. Thatsection reads :“ The District Court of the district in which the registered
office of a company is situate shall have jurisdiction ”. The words “ shallhave jurisdiction ” as contrasted with the words “ the District Courthaving jurisdiction” might have afforded more plausible support to thesubmission that the conferment of a new jurisdiction is in contemplation.But even so the support obtained would have been plausible, and no more,for it seems clear that the words of section 161 in the new Ordinance arenot meant to confer a new jurisdiction on District Courts, but only toprovide a new test as the sole test by which to ascertain the particularDistrict Court which shall function in any particular winding-upproceeding.
The question then arises in regard to the position of a Company notregistered under the provisions of Ordinance No. 4 of 1861 and not governedby the new Ordinance. Is there no way of winding-up such a company ?The answer seems to be provided by section 3 of the “ Introduction of theLaw of England ” Ordinance (Cap. 66, Vol. 2, Leg. Enactments) whichprovides that “ in all question or issues which may hereafter arise or which
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398
KEUNEMAN J.—Vyraven Chettiar v. Segappai Achy.
may have to be decided in this Island with respect to the law of partner-ship, Joint Stock Companies, Corporations, Banks and banking . ..
the law to be administered shall be the same as would be administered inEngland in the like case, at the corresponding period, if such questionor issue had arisen or had to be decided in England ”, “ with such formalalterations as to names, -localities, Courts, offices, persons, moneys,penalties and otherwise as may be necessary to make the same appli-cable to the circumstances of this Island
For these reasons I come to the conclusion that jurisdiction to wind upcompanies is conferred on District Courts by section 62 of the Courtsand their Powers Ordinance, and that sections 67 and 68 of the OrdinanceNo. 4 of 1861 do no more than provide the test for ascertaining the partic-ular District Court for any given winding-up proceeding in regard tocompanies under that Ordinance.
In this view of the matter the major premise as I described it, on whichPetitioners’ Counsel based his submission proves to be invalid andinvalidates his submission that District Courts have no jurisdiction towind up companies not registered locally. Consequently the petitioners’application in the way in which it was presented to us fails. The peti-tioners made no request that the District Court of Jaffna be prohibitedfor some particular reason, as for instance, for the reason that Jaffna wasnot the principal place of business of this Bank in this Island, and I wishto state quite clearly that this order does not consider or deal with thataspect or with the propriety of several District Courts in the Island beingengaged simultaneously in the winding-up of this Bank as was said, in thecourse of the argument, to be the case.
The application fails and must be dismissed with costs.
Nihill J.—I agree.
Application refused.