017-NLR-NLR-V-58-D.-M.-G.-UKKU-BANDA-Appellant-and-THE-RAHATUNGODA-CO-OPERATIVE-STORES-SOCIETY.pdf
Present: Swan, J., and Sansoni, J.
M. G. UKKU BANDA, Appellant, and THERAHATCNGODA CO-OPERATIVE STORESSOCIETY DTD., Respondent
S. C. 123—D. C. Kandy, l;092jX
Co-operative Societies Ordinance—Pule 20—Dispute between society and employee—Arbitration—Crucial dale is date oj reference—Second reference to arbitral ion—Validity—Section 4-5 (4).
A second reference to arbitration of (lie sumo dispute between a co-operativesociety and an employee is illegal as long ns the first award lias not been declaredto bo invalid by a Court of law.
■Vhcre on the date a dispute is referred to arbitration the employeeconcerned is still in the employ of the society, the reference f-s regular.
jA-PPEAL from a judgment of the District Court, Kandy.
C. It. Gttnaralne, for the defendant appellant.
No flpf>cjmuicc for the plaintiff respondent.
Cur. adv. vult~
Tbis is an appeal by the defendant from an order made by the Addi-tional District Judge, Kandy, allowing the application of the Rahatun-goda Co-operative Stores Society to issue writ against him to recover asum of Rs. SOS 98. The appellant was the ^Manager of the Society from1st February, 1945, to 20th July, 1947. On 17th July, 1947, actingunder rule 29 of the rules made under section 37 of the Co-operativeSocieties Ordinance, No. 34 of 1921, the Assistant Registrar of Co-operative Societies referred to one H. M. W. Tennekoon a dispute whichhad arisen between the. Society and the appellant over the value ofgoods entrusted to the appellant and not accounted for. The arbitratormade an award dated 27th December, 1947, directing the appellant topay the Society a sum of Rs. 737*40. The appellant appealed againstthe award but his appeal was dismissed by the Registrar of Co-operative
Apparently the Registrar thereafter declared that award to be ultravires on the ground that on the date of the award the appellant hadceased to be an emjiloycc of the Society. He is said to have taken thatstep in consequence of the decision of Gratiaen, J. in Illangakoon v.Bogollagama x. Another reference of the dispute was then made by anAssistant Registrar of Co-operative Societies to one M. B. Tennekoonon 11th October, 1950, and the latter made an award dated 21stNovember, 1950, directing the appellant to pay the Society a sum ofRs. SOS *9S. The order appealed from was made when the Society appliedto issue writ to execute that award. Notice of that application wasgiven to the appellant and two objections were taken on his behalf:(1) that after the first award was made the Assistant Registrar had noauthority to refer the dispute again to an arbitrator ;■ (2) that as the appel-lant was an officer of the Society when the first reference to arbitrationwas made the dispute was properly referable to arbitration even underthe unamended section 45 of the Co-operative Societies Ordinance (Cap.107), and the award made on such reference was valid. These objectionsamong others were taken befoie us at the hearing of this appeal and asthey are sufficient to dispose of the appeal I shall deal only with them.
To deal with the second objection first, I think the judgment of Dias,
J.in Canagasabai v. Kondavil Co operative Stores 2 concludes the matter ;the learned Judge decided, and I respectfully agree with that decision,that the crucial date is the date of reference. If on that date the appel-lant was the manager, it matters not if the appellant ceased to be themanager thereafter. The vital difference between Canagasabai v.Kondavil Co-operative Stores {supra) and the present case on the one hand,and Illangakoon v. Bogollagama (supra) on the other, is that the managerin the last-mentioned case had ceased to be the manager- before the matterwas referred to arbitration. It seems to me that the second referenceto arbitration was made because the Registrar of Co-operative Societiesmisunderstood the judgment of Gratiaen, J. The first award was infact a valid award. Since there was a valid award made on 27th
(1949) SO N. L. R. 465.
December, 1947, the second reference of 11th October, 1950, wasunwarranted. In saying this I do not mean to imply that a secondreference would have been permissible if the first award was bad.Whether the award was good or bad I do not see how it is open to anyauthority except a Court of law to declare an award ultra vires or invalid.Such a declaration is a usurpation of the authority which is properlyvested in a Court. If the Registrar can claim to make such a declaration,the appellant may also claim an equal right to make a declaration thatthe award is intra vires. The Registrar is empowered by section 45(4) to make a decision in an appeal, and he did so ; but he has no statutoryauthority to make a declaration as to the validity or invalidity of anaward. His decision on the appeal with respect to the first award isdeclared by section 45 (4) to be final and that would seem to be the endof the matter so far as ho is concerned. It follows then that there wasnothing to justify the second reference of the dispute, and the firstobjection is also sound.
In the result I would hold that the award dated 27th December, 1947,was final; it had never been properly set aside; the award dated 21stNovember, 1950, on which the application for writ was founded is in-valid and the application to execute it should have been refused. Forthese reasons I would allow this appeal with costs.
Swan, J.—I agree.
Appeal allowed.
1 (194S) 49 N. L. It. 403.