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Present: Branch C.J. and Garvin J.
P. & 0. BANKING C0EP0RATI0N o. SELVATHURAI.
166—D. C. Colombo, 17,060.
Liquid claim—Order for payment by instalments—Banking corporation—Civil Procedure Code, Chapter LIII.
Where, in an action by way of summary procedure on a liquidclaim, the defendant admits liability, it is competent to a Court*to enter a decree for payment of the amount due by instalments.
fiuch relief should not be denied 10 a debtor merely because thecreditor is a* Bank.
^PPEAL from an order of the District Judge of Colombo.
H. V. Perera, for plaintiff, appellant.
J. B. 7. Ferdinands, for defendant, respondent.
January 15, 1926. Bbanch C.J.—
A promissory note for Bs. 500 was endorsed and delivered to theappellant Bank, and that Bank brought action under Chapter LIII.of the Civil Procedure Code for the recovery of the amounts dueon the note. The respondent entered appearance and hied anaffidavit admitting the debt and stating as follows: —
“ I am employed in the Colombo Municipality on a monthlysalary of Bs. 230 per month and I am also possessed ofsome immovable, property in Jaffna worth about Bs. 8,000.The income on the said property is hardly sufficient to manageand look after the said property.
11 I am a married man living in Colombo and my expensesfor living in Colombo generally amount to about Bs. 200.
“With much difficulty I shall be able to pay Bs.. 50 permonth. ”
The learned District Judge made the following order:—“ I allow^the defendant to pay the amount by monthly instalments of Bs. 100,the first instalment payable on October 5. “
Three arguments are put forward for the appellant by Mr. Perera.First, that this being an action instituted under Chapter LIII. of theCode and the appellant's claim having been admitted, the appellantBecame entitled to an unconditional decree, forthwith, for the fullamount with costs, and, that the provisions of Section 194 of the Codedo not apply to actions instituted under Chapter LIII. Second,that as the appellant is a Bank, debtors should be compelled to keepstrict faith in regard, to their engagements, and that Section 19410
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should never be applied in cases where a Bank is the plaintiff..Third, that regard being had to the circumstances of this case, anInstalment order was not a proper one.
As regards (1) I do not agree. I think that section 194 is ofgeneral application. As regards (2) 1 do not agree. It seems to meimpossible to lay down any such definite and fixed rule with regardto a plaintiff Bank. All the circumstances of the case must of coursebe taken into consideration. Belief by way of instalments asregards the debtor should not be refused merely because the creditoris a Bank. As regards this particular case the note was datedMarch 7, 1925, and was due on June 4, 1925. The District Judgethinks that this and the amount of the note justify an instalmentdecree. I suppose he means that the Chetty to whom the note wasgiven and the debtor both had in mind the note not being met atmaturity. This is, of course, possible, but on the other hand thedebtor had according to his own account property of the value ofBs. 3,000 and the plaintiff might very properly have been left toobtain the fruits of his judgment from that property. The defend-ant has paid the instalments ordered and the next one will be due-on January 5, 1926.
In the circumstances the instalment ordered might be left as itstands and the appeal dismissed, but without costs.
This is an appeal by the plaintiff Company from an order of the*District Judge that the amount payable to them under the decreein their favour may be paid by the first defendant by monthlyinstalments of Bs. 100. The plaintiff is the endorsee of a promissorynote made by the first defendant in favour of a Chetty firm, andtheir action for the recovery of , the amount due them is constitutedunder Chapter LIII. of the Civil Procedure Code, which lays downthe “ Summary procedure for the recovery of legal claims. ” Theplaintiff duly obtained a summons and served the same on thedefendants. Within the- time prescribed the first defendantappeared, filed an affidavit, and, while admitting the debt, moved theCourt for an order to pay the amount by instalments. This, as Ihave observed, wa6 allowed. The appeal has been pressed on twogrounds: First, that it was not competent for the Court to. makesuch an order in an action brought under Chapter LIII, of the Codewhere the defendant had not obtained leave to appear and defend,but admitted his liability; secondly, that in any event the order ofthe Court should not be sustained for the reason that the Court hadnot given due weight to the fact that the plaintiff was a BankingCorporation and the condition under which the work of such a.corporation is conducted. The provisions of section 194 of the CivilProcedure Code vest in the Court power to make an order to pay by
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instalments “ in all decrees for the payment of money.” The only-exception to the very general terms in which the power to makesuch an order is vested is the case of money due on mortgages ofmovable or immovable property. There is nothing in the sectionnor in the chapter in which it appears to indicate that it was theintention of the Legislature that such orders were only to be made in•decrees for the payment of money made in regular actions. Indeed,if I understood Counsel aright, he was not prepared to contend that•even in a proceeding under Chapter LIII, such an order may not bemade in favour of a defendant who had obtained leave to appear anddefend, but had failed in his defence. It was urged, however, thatthe provisions of section 703 and in particular.section 704 necessarily-excluded the possibility of such an order being made in favour of a•defendant who admitted the claim but applied for such a concession.Section 703 lays down the procedure to be followed by a plaintiffwho desires to sue out a summons under Chapter LIII. Section 704proceeds as follows: “ In any case in which the plaint and summonsare in such forms respectively, the defendant shall not appear and•defend the action unless ihe obtains leave from the Court as herein-after mentioned so to appear and defend; and in default of hisobtaining such leave or of appearance and defence in pursuancethereof, the plaintiff shall be entitled to a decree for any sum not-exceeding the sum mentioned in the summons, ….”
It was urged that the effect of this section was to prevent the
appearance ” by the defendant for any other purpose whatsoeverexcept to obtain leave to defend the action. What the sectiondenies a defendant is the right to " appear and defend ” without theleave of the Court.
He must, of course, “ appear ” before he can obtain leave. Having” appeared ” it seems to me that he may take any steps appropriateat that stage of the proceedings so long as he does hot attempt to“defend” the action. In my view the language of the sectionsrelied on by Counsel for the appellant does not prevent a personserved with a summons under Chapter LIII. from appearing and•consenting to judgment, nor does it prevent a person who has soconsented to judgment from appealing to the Court to exercise thepower conferred on it by section 194 in his favour.
As regards the second of the two points taken in support of thisappeal, I agree that the fact that the plaintifE is a Banking Corpora-tion and that this promissory note came into their possession in theordinary course of this business and the resulting inconvenienceto the work of such a corporation are factors to which due weightshould be given not only in deciding whether an order to pay byinstalments should be made but also in determining the terms ofsuch an order.
P. <fr O.BankingCorporationv.
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The District Judge appears to have considered these factors and tohave given them the weight to which he thought they were entitledunder all the circumstances of this case, and I am not prepared to say*that his order is wrong.
I would dismiss the appeal but, for the reasons given by the ChiefJustice, without costs.
P. & O. BANKING CORPORATION v. SELVATHURAI