Central Union Insurance Co., Ltd. v. Boteju
1954Present: Weerasooriya J. and de Silva J.CENTRAL. UNION INSURANCE CO., LTD., Appellant, andBOTEJU, RespondentS. C. 93—D. C. (Inly.) Colombo, 15,414 S
Liquid claim—Summary procedure—Instrument must bear stamp—Civil ProcedureCode, sa. 703, 705 (2), 706.
A condition precedent to the issue of summons in an action by summary pro-cedure on a liquid claim is that the document on which the action is based shouldbe properly stamped, its required by section 705 (2) of the Civil Procedure Code.
(1888) 21 Q. B. D. 313.
(1948) 51 N. L. It. 34.
ICO WEfiRASOORIYA J.— Central Union Insurance Co., Ltd. v. Boteju
^k.PPEAL from an order of the District Court, Colombo.
O. Weerarftanlry, for the defendant appellant.
J.C. Thurairatnam, for the plaintiff respondent.
Cur. adv. vult.
October 27, 1954. Webrasooriya J.—
This is an appeal filed by the defendant Company against an order madeby the learned District Judge under s. 706 of the provisions in Chapter 53of the Civil Procedure Code relating to summary procedure on liquidclaims, giving leave to the defendant-appellant to file answer on furnishingsecurity in a sum of Rs. 6,000.
The plaintiff-respondent sought in this action to invoke the provisionsof Chapter 53 in order to obtain judgment against the defendant-appellanton a document marked “ A ” and annexed to the plaint. The documentin question which is dated the 1st August, .1953, and addressed to theplaintiif-rospondent by the defendant-appellant is in the followingterms :—
“ Dear Sir,
This is to confirm that we owe you Rupees nine thousand three
hundred and forty-seven and cents nine only (Rs. 9,347-09) up to
this day, which sum we propose to pay you at an oarly date.
The Ceylon Union Insurance Co., Ltd. ”
It would appear that prior to the date on which this document waswritten there were certain transactions between the plaintiff-respondentand the defendant-appellant mostly in the nature of loans arranged by theplaintiff-respondent for the benefit of the defendant-appellant, and onthe 1st August, 1953, the plaintiff-respondent forwarded a statementmarked X2 to the defendant-appellant claiming a sum of Rs. 9,927.50 dueto him on these transactions. The document “ A ” is said to have beenwritten by the defendant-appellant with reference to this claim, andaccording to that document the defendant-appellant admitted liability inthe sum of Rs. 9,347 • 09 only, which iB less than the amount claimed in X2.The defendant-appellant subsequently sent to, the plaintiff-respondent theletter X3 dated the 4th August, 1953, which is in the following terms :—
" Dear Sir,‘
Further to our letter of the 1st August, 1953, we have now to point outto you that the amount Rs. 9,347-09 mentioned in our letter isincorrect..
However, we will send you a statement of accounts early afterchecking up the accounts.
The Central-Union Insurance Co., Ltd. ”
WEERASOOKIYA J.—Central Union Insurance Co., Ltd. v. Boteju 181
There is no evidence whether a statement as promised-in paragraph 2 of <X3was sent by the defendant-appellant. This action was filed, on the 2ndOctober, 1953.
The learned District Judge in making the order appealed from heldthat the document “ A ” is “ a contract in writing for a liquidated amountof monoy ” within the meaning of s.703 in Chapter 53 of the Civil Pro-cedure Code and that the plaintiff-respondent could sue on it by way ofsummary procedure. – '
Learnod counsel fop the defendant-appellant cited to us the case ofSabapathipillai v. The Jaffna Trading Co. 1 where it was held by de Sam-payo J. (Schneider J. agreeing with him) that the instrument or contractin writing for a liquidated amount of money referred to in s. 703 must be ofthe same nature as the documents referred to immediately before in thatsection, namely, a bill of exchange, promissory note or cheque, and thatunder s. 705 the Court is required to satisfy itself that the instrumentis properly stamped before it allows summons.
In the present case it cannot be contended that the document “ A ”is in the nature of a bill of exchange, or a cheque. Whether it is in thenature of a promissory note seems to me to be extremely doubtful sinceaccording to Chalmers on Bills of Exchange 2 a document to constitutea promissory note must be such as to show the intention to make anote, a rule which is based on th'd' view that parties aro not precludedfrom making written contracts relating to the payment of money, otherthan bills and notes ; and from the document in question and the circums-tances, as already set out by me, in which it came to be written, anti alsofrom the subsequent letter X3, it would seem that the defendant-appellantdid not intend it to serve as a promissory note.
Tt is howover not necessary to decide the question whether the document“ A ” is in the nature of a promissory note because the order made by thelearned District Judge is shown to be incorrect on another ground. Evenassuming that this document is in the nature of a promissory note s.705 (2)of the Civil Procedure Code requires that it should appear to the Court tobe properly stamped before issuing summons. As pointed out by deSampayo J. in the case of Sabapathipillai v. The Jaffna Trading Co.(supra), this is a condition precedent to the issue of summons. The docu-ment “ A " bears no stamp at all and it is not contendend by learnedcounsol for the plaintiff-respondent that if it is a document of the naturereferred to in s.703 it is not liable to any stamp duty at all.
The order of the learned District Judge is, therefore, Bet aside and thocase is remitted to the lower Court so that a date may be given to thedofendant-appellant to file answer unconditionally. The plaintiff-respondent must pay to the defendant-appellant the costs of this appealand of the inquiry in the Court below.
de Silva J.—I agree.
Order set aside.
1 4 C. L. Bee. 210.
1 Uth Ed. p. 2G1.
CENTRAL UNION INSURANCE CO.LTD , Appellant ,and BOTEJU, Respondent
Central Union Insurance Co., Ltd. v. Boteju