040-SLLR-SLLR-2005-V-3-NANDAWATHIE-vs.-JAYATILAKE-AND-OTHERS.pdf
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NANDAWATHIEVSJAYATILAKE AND OTHERSCOURT OF APPEAL.
SOMAWANSA, J. (P/CA) ANDWIMALACHANDRA, J.
CA 2174/2003.
DC GALLE 8977/T.
JULY 25, 2005.
Civil Procedure Code, sections 408 and 839 – Settlement – Application to setaside Settlement – an after thought? – Can a party resile from a settlement? -Circumstances.
All parties including the petitioner signed the terms of settlement tendered toCourt. The registered attorney – at- law of the petitioner too signed the records.Acting on the terms of the settlement, the parties have paid the fees of thevaluer and with the consent of all parties the administrator executed theadministrative conveyances. Even the petitioner became entitled to certainlands. Two months later and after the execution of the transfer deeds, thepetitioner made an application in terms of section 839 to set aside thesettlement, on the grounds that it was arbitrary, illegal, unfair and biased,unjustifiable or fraudulently disproportionate. This application was rejected bythe trial judge. The petitioner moved in revision.
CA
Nandawathie vs
Jayatilake and Others (Andrew Somawansa, J. (P/CA))
231
HELD:
The signing of the terms of settlement by the petitioner and her registeredattorney-at-law would negative all the allegations raised. The petitionercannot be heard to say that she was unaware or did not understand theterms of settlement.
It appears that this in fact is an after thought. As a general rule, agreementby way of compromise should not be re-opened on the ground of afterthought of a party.
Per Somawansa. J (P/CA):
"It is to be noted that at all times relevant to this settlement the petitioner wasrepresented by her registered attorney-at-law as well as her Counsel, none ofthem have come to her rescue at least by tendering a written statementcorroborating the averments of the petitioner”.
Once the terms of settlement as agreed upon are presented to courtand notified thereto and recorded by court a party cannot resile from thesettlement even though the decree has not yet been entered.
Per Somawansa, J. (P/CA):
“I am not impressed at all with the submission of counsel for the petitioner thatshe was totally unaware of the terms of settlement – when court accepted theterms and that she was taken by surprise and due to inadvertence, lack ofunderstanding under pressure and misleading explanation she wascompelled to sign.”
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APPLICATION in revision from an order of the District Court of Galle.
Cases referred to :
Gunasekara vs. Leelawathie – Sri Kantha Law Reports Vol 5 – page 139
Newton vs. Sinnadurai – 54 NLR 4
Saranelis vs. Agnes Nona 1987 2 Sri LR 109
John Keels vs. Kuruppu 1996 W Sri LR 6
Dassanayake vs. Dassanayake – 30 NLR 385
Cosfa vs. Silva – 22 NLR 478
Sinna Velu vs. Upton Ltd – 66 NLR 214
Dayawathie and Others vs. Fernando 1988 2 Sri LR 314
Lameer vs. Senaratne 1995 Sri LR 13
J.Palihawadana for petitioner,
Ananda Kasturiarachchi with K. Pathiraja for 4th, 5th and 9th respondents.Rohan Sahabandu with Gamini Hettiarachchi for respondent.
Cur. adv. vult.
October 21, 2005.
ANDREW SOMAWANSA, J. (P/CA)This is an application in revision seeking to revise and set aside thesettlement order of the learned District Judge of Galle dated 30.07.2003and for an order for re-hearing of this action as from the date the proceedings
CA
Nandawathie vs
Jayatilake and Others (Andrew Somawansa, J. (P/CA))
233
were stayed. When this application was taken up for argument partiesagreed to resolve the matter by way of written submissions and both partieshave tendered their written submissions.
The relevant facts are on 05.02.2003 the learned District Judge madefurther order that an inquiry is not necessary and that the parties preparea scheme of allocating property by way of settlement and thereafter uponpresenting a list of properties the Court made a further order dated
marked B that –
all properties shall be subject to sale by public auction and theproceeds shall be distributed among heirs ;
prior to such auction a proper valuation report shall be presentedon the next calling date which was 30.07.2003.
On 30.07.2003 parties including the 3A respondent – petitioner – petitionerinformed Court that the parties have arrived at a settlement and the signedterms of settlement was tendered to Court signed by parties including the3A respondent – petitioner -petitioner and her registered Attorney -at -Law.Thereafter it is to be seen that all parties including the 3A respondent -petitioner- petitioner signed the record as well, as evident by the journalentries marked 4D8. In terms of the aforesaid settlement it was agreed byparties to give up the final accounts pursued by them for nine years and torecall the commission for valuation of properties, to transfer the propertiesas per the settlement by way of administrative conveyances and to terminatethe testamentary proceedings.
In terms of the settlement marked A the 3A respondent – petitioner-petitioner on behalf of the heirs of the deceased Herbert Jayatilake was toreceive the land morefully described in the first schedule. It appears thatparties acting on the terms of the aforesaid settlement have already paid a
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sum of Rs. 191,000 as fees of the valuer as evident by 4R10 and 4R11 andwith the consent of all parties executed the Administrator's Conveyancesmarked VR12 to 4R18 and the 3rd respondent – petitioner – petitioner andchildren who are the heirs of the deceased 3rd respondent HerbertJayatilake are now the owners of the lands described in the aforesaidAdministrative Conveyance marked 4R16.
On 01.10.2003 two months after and after the execution of the aforesaiddeeds the 3rd respondent – petitioner – petitioner made an application interms of section 839 of the Civil Procedure Code to set aside the aforesaidsettlement. It was supported on 08.10.2003 and on the same day thelearned District Judge refused the application of the 3rd respondent -petitioner – petitioner. The present application challenging the settlemententered on 30.07.2003 and the subsquent order dated 08.10.2003 istendered to this Court on 12.12.2003. It is to be noted that there is noexplanation or reason given for the undue delay in making this revisionapplication.
Counsel for the 3rd respondent – petitioner – petitioner contends thatthe settlement is arbitrary and illegal, that the terms of settlement areunfair and or biased, unjustifiable and or fraudulently disproportionate, thatnecessary heirs have not been made parties, that the terms are misleading,unreasonable, causing unjust enrichment in respect of certain heirs, whileomitting rights, title and entitlements of certain heirs and are illegal, unlawfuland contrary to law and the alleged scheme of settlement does not reflectthe intention of all parties.
In this respect counsel for the 3rd respondent – petitioner – petitionerhas cited Gunasekara vs. Leelawathiem Newton vs. SinnaduraP, Saranelisvs. Agnes Nona131 John Keels vs. Kuruppu(4> and Dassanayake vs.Dassanayake<s> However I do not think that the decisions of the aforesaidcases are applicable to the instant application.
CA
Nandawathie vs
Jayatilake and Others (Andrew Somawansa, J. (P/CA))
235
In the settlement entered into between the parties and as accepted bycourt, the contesting 3rd respondent – petitioner- petitioner as well as herregistered Attorney-at-Law has consented to the terms of settlement bysigning the terms of settlement tendered to Court and thereafter by signingthe record testifying to the acceptance of the terms of settlement. In thecircumstances, I am not impressed at all with the submission of counselfor the 3rd respondent – petitioner – petitioner that she was totally unawareof the terms of settlement when Court accepted the terms and that shewas taken by surprise and due to inadvertence, lack of understanding,under pressure and misleading explanation she was compelled to sign. Itsuffices to say that the signing of the terms of settlement by the 3rdrespondent – petitioner – petitioner and her registered Attorney-at-Law andthereafter the 3rd respondent – respondent signing the record acceptingthe terms of settlement would negative all the allegations raised by counselfor the 3rd respondent – petitioner – petitioner. In the circumstances the 3rdrespondent – petitioner – petitioner cannot be heard to say that she wasunaware or did not understand the terms of settlement. It appears to methat this fact is an after thought. As it was held in Costa vs. Silva(6> as ageneral rule agreement by way of compromise should not be reopened onthe ground of after thought of a party. In any event, it is to be noted that atall times relevant to this settlement the 3rd respondent – petitioner – petitionerwas represented by her registered Attorney -at -Law as well as her counsel.None of them have come to her rescue at least by tendering a writtenstatement corroborating the averments of the 3rd respondent petitioner-petitioner. An affidavit by anyone of them would have been much better.Unfortunately none was forth coming.
It was held in Sinna Veloo vs. Lipton Ltd.171:
“When parties to an action enter into a settlement and are representedby their Proctors, they need not be personally present when the settlementis notified to the Court in terms of section 408 of the Civil Procedure Code.
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Once the terms of settlement as agreed upon are presented to Courtand notified thereto and recorded by Court, a party cannot resile from thesettlement even though the decree has not yet been entered."
Also in Saranelis vs. Agnes Nona (supra):
“The general principle that should be followed is that a settlemententered into by the parties and notified to Court in terms of section 408 ofthe Civil Procedure Code should not be lightly interfered with whether adecree has been entered by Court in pursuance thereof, or not. But in thiscase the Court had been misled into recording the settlement in regard toa roadway without a plan or even a sketch so that there would be uncertaintyabout the course of the right of way. Besides the settlement involved therights of the Municipal Council who was not a party. In these circumstancesas the Court was misled, setting aside the settlement using the inherentpowers of court under section 839 of the Civil Procedure Code was warrantedin the interests of justice.”
In the case of Dayawathie and Petris vs. Fernandom it was held :
“Notwithstanding the judgment entered in a civil case it is permissiblefor the parties to enter into a compromise of their rights under the decree”.
I would also refer to the decision in Lameer vs. Senaratne,9> where itwas held:
(1) When an Attorney – at- Law is given a general authority to settleor compromise a case, client cannot seek to set aside a settlementso entered, more so, when the client himself had signed the record.
CA
Sopi Nona vs
Kamnadasa and Another
237
There is no affidavit from the Attorney-at-Law affirming that thepetitioner was forced into accepting the terms of settlement.Pleadings indicate that the settlement was first suggested on21.06.1991 and entered only on 13.07.1991.
Court cannot grant relief by way of restitution to a party who hasagreed in Court, to sell property at a lesser price with the fullknowledge of its true value.
There is no uncertainty as, in this instance the respondent hasalready deposited the full sum due."
For the foregoing reasons, I have no hesitation in dismissing the instantapplication for revision. Accordingly the application will stand dismissedwith costs fixed at Rs.5000 to be paid by the 3rd respondent – petitioner -petitioner to each of the contesting 4th, 5th, 8th,and 9th respondents -respondents.
WIMALACHANDRA, J. – / agree.
Application dismissed.