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Synopsis

The Supreme Court recently said the law favours the diligent and not the indolent as it set aside the high court's order, which allowed an application to set aside an ex parte decree for specific performance, after condoning the delay of 1312 days, long after legal representatives of the defendant appeared in an execution petition filed by the plaintiff.

A bench of Justices Sudhanshu Dhulia and K Vinod Chandran found the application filed on January 4, 2020, to set aside the ex-parte decree of April 13, 2016, was only an afterthought and purely experimental and thus restored the order of the trial court rejecting the application for condonation of delay. The court said it could not find the delay as nondeliberate.

The high court had condoned the delay and allowed the application, setting aside the ex -parte decree on payment of cost of Rupees One lakh and issued a direction to file a written statement within a period of four weeks. It had also directed for disposal of the suit within a period of three months from the date of receipt of copy of order.

The high court had also noted the predecessor-in-interest who was the defendant in the suit and who had also half interest in the property though had appeared before the trial court had not filed a written statement and later died, upon which the wife and son, the legal representatives came into the picture. 

It had also allowed a contention that the counsel who was handling the case on behalf of the deceased had taken time to hand over the files; which were misplaced. The file was eventually handed over on December 16, 2019 soon after which the petition to set aside the ex-parte decree was filed. The high court had thus reversed the detailed order of the trial court which refused to condone the delay on the facts coming out from the records.

After hearing the parties and going through the record, the bench said, "We are of the clear opinion that the impugned judgment was not on good grounds and the cost awarded and the directions for expeditious consideration would not unsettle the imbalance which would be caused to the plaintiff who had been waiting to get possession of the property for the last one decade. We are unable to accept the reasoning of the impugned order to condone the delay occasioned, because there is falsity writ large, in the submission of the lawyer having misplaced the files."

As per the facts, defendants 1 and 2 jointly owned the scheduled property and the first defendant; now deceased and represented by his legal representatives, executed a power of attorney in favour of the second defendant. The second defendant on his behalf and also on behalf of the first defendant executed a sale agreement in favour of the plaintiff for consideration of Rs 20 lakh out of which Rs 5 lakh were paid. 

The plaintiff, though always willing and ready to discharge his part of the agreement, the second defendant failed so to do and also refused to turn up at the Sub Registrar’s Office where the plaintiff had gone on January 14, 2016 with the balance sale consideration; resulting in the initiation of the suit for specific performance.

The court noted admittedly an execution petition was filed in which the legal representatives, the respondents had appeared. It was much later that the petition for setting aside the ex-parte decree was filed.

The plaintiff contended that the claim that the first defendant was hospitalised could not be accepted since the document produced indicated it to be a hospitalisation long after the judgment and decree. Further, the very contention taken up before the trial court that the files were handed over late, also could not be countenanced since the very same lawyer continued to represent one of the legal representatives. 

His counsel said there was no equity in now seeking to set aside a decree of specific performance especially when the plaintiff had deposited the balance consideration of Rs 15 lakh at the time of filing the suit itself and there was considerable escalation of the value of the property in the time ensuing, which benefit had to go to the plaintiff-appellant.

The defendants contended that there were umpteen number of cases in which the apex court exercised the equitable jurisdiction when there was sufficient hardship shown. The agreement for sale was a purely collusive affair without knowledge of the first defendant, that the first defendant had cancelled the power of attorney on coming to know of it. They also submitted that the very valuable property was sold away for a pittance and the legal representatives are entitled to the benefit of the property purchased by the hard earned money of their predecessor. They also undertook that the entire advance amount can be deposited and there is sufficient protection granted to the plaintiff by the impugned order which directed expeditious disposal of the suit.

The court noted the agreement itself was of the year 2013 and the suit of the year 2015. It also said there was nothing to show that the first defendant suffered from any ailment which disabled him to contest the matter. Admittedly the first defendant had died long after the suit was decreed in which period also he did not contest the suit, it pointed out.

The bench also pointed out that though it was contended the defendant was suffering from Parkinsonism, the gravity of the affliction was not evident from the document produced before the trial court.

With regard to the contention that they were unaware of the ex-parte decree and they had approached their lawyer who had taken considerable time in returning the files, the bench said, "We are unable to accede to the same, since, information regarding the ex-parte decree, if not earlier available to the respondents was definitely available on August 20, 2018 when they appeared before the execution court."

The court also pointed out a frivolous and bland contention had been raised that the lawyer took time to return the files. It also rejected the relief sought on the principles of genuine hardship.

Case Title: K Ramasamy Vs R Nallammal & Ors