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Supreme Court of India

B.S. KRISHNA MURTHY AND ANR.versusB.S. NAGARAJ AND ORS.

Citation
2011 INSC 46
Decided
14 January 2011
Disposal
Disposed off

Holding

The court held that parties should be referred to mediation under Section 89 and that lawyers have a duty to advise mediation, particularly in family and business relationships.

Summary

The case involved a dispute between two brothers concerning family and business matters. The petitioners sought relief from the High Court, but the Supreme Court examined whether the parties should be directed to resolve the dispute through mediation. Relying on the purpose of Section 89 of the Code of Civil Procedure and quoting Mahatma Gandhi’s advocacy for arbitration and mediation, the Court emphasized that prolonged litigation would be detrimental to familial relationships. It held that lawyers have a duty to advise their clients to attempt mediation, especially where personal relationships are at stake. Consequently, the Court ordered that the matter be referred to the Bangalore Mediation Centre and directed the parties to appear before it on a specified date.

Issues considered

  • Whether the court can direct parties to mediation under Section 89 of the Code of Civil Procedure, 1908.
  • Whether lawyers have a responsibility to advise their clients to pursue mediation in family and business disputes.

Legislation cited

Subjects

mediationarbitrationfamily disputebusiness disputelawyer's dutySection 89alternative dispute resolutionCivil Procedure

Judgment

                  . [2011] 1 S.C.R. 387


           B.S. KRISHNA MURTHY AND ANR.                       A
                             v.
                B.S. NAGARAJ AND ORS.
      (Special Leave Petition (C) No. 2896 of 2010)
                    JANUARY 14, 2011
                                                              B
[MARKANDEY KATJU AND GYAN SUDHA MISRA, JJ.]

     Alternative disputes redressa/: Mediation - Disputes
involving family and business relationships - Resolution of,
by mediation - Responsibility of lawyers - Held: It is the C
responsibility of lawyers to advise their clients to try for
mediation for resolving the disputes, especially where
relationships like family and business relationships are
involved, otherwise the litigation would drag on for years and
decades - Lawyers as well as litigants ought to follow D
Mahatma Gandhi's advice in the matter and try for arbitration/
mediation - This is also the purpose of s. 89 - In the instant
case, dispute was between the brothers - Matter referred to
the Bangalore Mediation Centre - Code of Civil Procedure,
 1908 - s.89.                                                  E

   · · 'My Experiments with Truth' by Mahatama Gandhi -
referrSJ."f,JQ,

    CIVIL APPELLATE JURISDICTION : SLP (CIVIL} No.
2896 of 2010.                                                 F

    From the Judgment & Order dated 17.09.2009 of the High
Court of Karnataka at Bangalore in RFA No. 1387 of 2004.

   G.V. Chandrashekar, N;K. Verma (for Anjana
Chandrashekhar) for the Petitioners.                          G

   P. Vishwanatha Shetty, Vijay Kumar Pardesi, Mahesh
Kumar. G.N. Reddy for the Respondents.

                            387                               H
    388       SUPREME COURT REPORTS                 [2011] 1 S.C.R.


A         The following order of the Court was delivered

                                ORDER

          Heard learned counsel for the appearing parties.

B       This is a dispute between brothers. In our opinion, an effort
    should be made to resolve the dispute between the parties by
    mediation.

       In this connection, we would like to quote the following
C passages from Mahatma, Gandhi's book 'My Experiments with
  Truth':-

        "I saw that the facts of Dada Abdulla's case made it a very
  strong indeed, and that the law was bound to be on his side.
  But I also saw that the litigation, if itwere persisted in, would
D ruin the plaintiff and the defendant, who were relatives and both
  belonged to the same city. No one knew how long the case
  might go on. Should it be allowed to continue to be fought out
  in Court, it might go on indefinitely and to no advantage of
  either party. Both, therefore, desired an immediate termination
E of the case, if possible.

       I approached Tyeb Sheth and requested and advised him
  to go to arbitration. I recommended him to see his counsel. I
  suggested to him that if an arbitrator commanding the
  confidence of both parties could be appointed, the case would
F be quickly finished. The lawyer' fees were so rapidly mounting
  up that they were enough to devour all the resources of the
  clients, big merchants as they were. The case occupied so
  much of their attention that they had no time left for any other
  work. In the meantime mutual ill-will was steadily increasing. I
G became disgusted with the profession. As lawyers the counsel
  on both sides were bound to rake up points of law in support
  of their own clients. I also saw for the first time that the winning
  party never recovers all the costs incurred. Under the Court
  Fees Regulation there was a fixed scale of costs to be allowed
H
B.S. KRISHNA MURTHY AND ANR. v. B.S. NAGARAJ 389
                 AND ORS.

as between party and party, the actual costs as between                A
attorney and client being very much higher. This was more than
I could bear. I felt that my duty was to befriend both parties and
bring them together. I strained every nerve to bring about a
compromise. At last Tyeb Sheth agreed. An arbitrator was
appointed, the case was argued before him, and Dada                    B
Abdulla won.

     But that did not satisfy me. If my client were to seek
immediate execution of the award, it would be impossible for
Tyeb Sheth to meet the whole of the awarded amount, and there          c
was an unwritten law among the Porbandar Memons living in
South Africa that death should be preferred to bankruptcy. It was
impossible for Tyeb Sheth to pay down the whole sum of about
37,000 and costs. He meant to pay not pie less than the
amount, and he did not wnat to be declared bankrupt. There             D
was only one way. Dada Abdulla should allow him to. pay in
moderate installments. he was equal to the occasion, and
granted Tyeb Sheth installments spread over a very long period.
It was more difficult for me to secure the concession of payment
by instalments than to get the parties to agree to arbitration.        E
But both were happy over the result, and both rose in the public
estimation. My joy was boundless. I had learnt the practice of
law. I had learnt to find out the better side of human nature and
to enter men's hearts. I realized that the true function of a lawyer
was to unite parties riven asunder. The lesson was so indelibly
burnt into me that a large part of my time during the twenty year$     F
of my practice as a lawyer was occupied in bringing about
private compromises of hundreds of cases. I lost nothing
thereby-not even money, certainly not my soul.•

      In our opinion, the lawyers should advise their clients to try G
for mediation for resolving the disputes, especially, where
relationships, like family relationships, business relationships,
are involved, otherwise, the litigation drags on for years and ·
dacades aften ruining both the parties.
                                                                       H
    390      SUPREME COURT REPORTS                 [2011) 1 S.C.R.

A        Hence, the lawyers as well as litigants should follow
    Mahatma Gandhi's advice in the matter and try for arbitration/
    mediation. This is also the purpose of Section 89 of the Code
    of Civil Procedure.                            ·

        Let the matter be referred to the Bangalore Mediation ·
8
    Centre. The parties are directed to appear before the
    Bangalore Mediation Centre on 21.02.2011.

          List after receiving report from the Mediation Centre.

C D.G.                                             Matter Pending.




                                                                     ..


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