BANDAHAMY, Appellant, and SENANAYAKE , Respondent

067-NLR-NLR-V-62-BANDAHAMY-Appellant-and-SENANAYAKE-Respondent.pdf


Bandahamy v. Ssnanayahe
313
1960Present : Basnayake, C. J., Pulle, J., Weerasooriya, J.,
K. D. de Silva, J., Sansoni, JH. N. G. Fernando, J., and' Sinnetamby, J.
BANDAHAMY, AppeUant, and SENANAYAKE, RespondentS. G. 206—D. G. Kurunegala 549fSpJ.
Co-operative society—Appointment of liquidator—Dispute between liquidator and apast officer of the society—Right of liquidator to refer the dispute for compulsory
arbitration—Award of arbitratorJurisdiction of executing Court to test its
validity—Procedure for enforcement of award—Retirement of notice to res-pondent—Co-operative Soctelies Ordinance {Cap. 107) (as amended by s. 9 of
Act 2Vo. 21 of 10s9). ss. 2, 36, 30. 40 ( 7) (d), 41 (/i). 45 (1), 45 (2), 45 (4). 45 (5)
Co-operative Societies (Special Provisions) Act .Vo. 17 of 1952, s. 2 —Co-opera-tive. Societies Rules of 1050, Rules 3S (1), 38 (13).
Judicial precedent—Binding effect thereof—Scope of rule of stare decisis—“ CollectiveCourt **-—Courts Ordinance (Cap. 6), ss. 3S, tR, 51.
The appellant was the treasurer of a co-operative society and the respondentwas appointed under section 39 of the Co-operative Societies Ordinance to bothe liquidator of the society. On 19th March 1949 a dispute arose betweenthe appellant and the respondent as tc whether the appellant owed the societya sum ofRs. 5CO/74 in respect of* “ leakages in textiles”. On 21st May 1952the disputo was referred by the liquidator to the Registrar of CooperativeSocieties for decision. Thereafter, an Assistant Registrar of Co-oporativeSocieties who was empowered to exercise the funotions of the Registrar reforredtho dispute for disposal, as arbitrator, to an inspector of the Co-oporativeDepartment. The arbitrator made his award ordering the appellant to pay thosum of Rs. 560/74 with interest. An appeal to the Registrar against the awardwas dismissed. As the appellant tailed to pay the amount of the award, thorespondent mode application under Rule 38 (13) of tho Co-operative SocietiesRules of 1950 to the District Court of Kurunegala for the enforcement of theaward.
Held, (i) by Puxle, 'Weterasooriya, K. D. de Selva, Sansoni, H. N. G.Feknando, and Sinnetamby, JJ. (Basnayake, C.J., dissenting), that, undersoction 40 (1) (d) of the Co-operative Societies Ordinance, as amended bysection 9 of Aot No. 21 of 1949. th< liquidator was entitled to refer tho disputefor oompulsory arbitration under section 45. In view of section 2 (1) of thoCo-operative Societies (Special Provisions) Act No. 17 of 1952, the provisionsof section 45 of the Co-operative Societies Ordinance were applicable to everysuch dispute notwithstanding that it had arisen prior tc- 24th May 1949, whichwas the dato on which the amending Act No. 21 of 1949,oamo into operation.
The fact that the liquidator referred the dispute to tho Registrar ** for decision**could not vitiato tho award of tho arbitrator.
(ii) by Basnayake, C.J., Wkerasoortya, J., Sansoni, J., and EC. N. G.Fernando, J. (Pctlie, J., K. D. de Selva, J., and Sennetamby, J., dissenting),that it is nooeasary that when the powers of a Court are invoked for the enforce-ment of an award as a decree of such Court (in terms of Rule 38 (13) of the rulesmade under section 46 of the Co-operative Societies Ordinance), the partyagainst whom the award is sought to be enforced should be noticed and givenan opportunity of showing the existence of defeots, even though the awarddoes not bear any fatal daws on its face,
14, 15 & 16—lxhiJ. N. B. 14709—2,025 (12/60).
314
BASNAYAKE, G.J.—Bandahamy v. Setia.na.yn.ke
Jayasinghe v. B or ago dawaite Co-operative Stores Society (56 N. L. R. 462),approved.
by BasnaYaee, C.J., Weebasoohiya, J., Sansoni, J., EL N. Q. FefotakdoJ., and Sennetamby, J. (Pttlle, J.p and K. D. de Suva, J., dissenting), that
-it is open to the party against whom the award is sougnt to bo enforced toquestion the validity of the award, even it the award is ex facie regular.
by Basnayake, C-.J-, Polie, J., Weeeasoobiya, J., Sansont, J.,and H. IT. G. Feknasdo, J. (Sinnetamby, J., dissenting), that a decision bya Bench constituted under section 51 of the Courts Ordinance is not a decisionof a Collective Court unless the Bench consisted of all the Judges of the SupremeCourt.
by Pclle, J., Weebasooiuya, J., Sansont, J., EL N. G. Fernando, J.,and SrNNETAMBY, J. (Basnayake, C.J., dissenting), that the numericalsuperiority of a particular Bench is determined with reference to the numberof Judges constituting that Bench, regardless of whether the Judges areunanimous or divided.
by Pi'ttE, J., Weebasoobiya, J., Sansont, J., and Id. N. Q. Fernando,
J. (Basnayake, C.J., and Sinnetamhy, J., dissenting), that where, in a civilappeal, a decision by a Bench constituted under section 51 of the Courts Ordi-nance is not that of the Collective Court, its value as a precodent is subject to tlieprinciple that it is not binding on a subsequent Bench which is numericallystronger. The decision in The Pinikaha.no. TCahaduiaa Co-operative SocietyLtd-, v. Herath (59 N. L. R. 562) being that of a Bench of fivo Judges (oven thoughthey were divided three to two) should bo regarded as overruling the unanimousdecision of three Judges in Jayasinghe v. Boragoda.wa.Ua, Co-operative Stores(56 N. L. R. 462), and a Bench constituted of seven Judgos (as in the presentcase) is not bound by the decision in The Pinikahana Kahaduwa Co-operativeSociety Ltd. v. Herath (supra).j
In regard to points (iv), (v) and (vi), no opinion was expressed by K. D. deBtLVA, J.
Obiter, per H. N. G. Fernando, J.—“ The cursus curiae does not requiretbat a Bench of two Judges must follow a former decision of another Bench' of two Judges. ”
j^_PPEAii from a judgment of the District Court, Kurunegala.
PL. V. Perera, Q.G., with D. R. P. GoonetilleTce, JD. S. Nethsinghe, .Maureen Seneviratne and R. JD. B. Jayasehera, for Debtor-Respondent-Appellant.
. jQT. W. Jayetvardene, Q.G., . with E. J. Cooray, E. B. Vannitamby,
Q.P. Fernando and L. G. Seneviratne, for Petitioner-Respondent.
Gur. adv. vvXt.
October 28, 1960. Basnayake, C.J.—
*
This is an appeal from an order of the District Judge allowing an appli-cation of the liquidator of the TJdapola Co-operative Stores Society toenforce an award.
The fhets '■as stated by the liquidator, who is the respondent to thisappeal, are as follows :—The Udapola Co-operative Stores Society whichwas registered on fOth January 1944 was carrying on business at Udapola
BASNAYAKE, C. J.—Sandaharny v. Senanayake.
316
-_—■———^
until 9th March 1949. By order of the Registrar of Co-operative Socie-ties dated 3rd December 1948 the respondent was appointed liquidatorof that Society. The appellant was the treasurer and the person in chargeof its textiles from 2nd "February 1947 till 19th March 1949.
On the latter date a dispute arose between the appellant and theliquidator. The dispute was whether the appellant owed the Societya sum of Rs. 560/74. It was referred by the liquidator to the Registrarof Co-operative Societies for decision.
The Assistant Registrar of Co-operative Societies who was empoweredto exercise the functions of the Registrar referred the dispute for. disposal,as arbitrator, to an inspector of the Co-operative Department. Thearbitrator made his award on 19th August 1952 ordering the appellantto pay the sum of Rs. 560/74 with interest thereon at 5% per annum.He appealed to the Registrar against the award and on 24th March 1953the appeal was dismissed. As the appellant failed to pay the amount ofthe award, the respondent made the following application under Rule38 (13) of the Co-operative Societies Rules 1950 to the District Court ofKurunegala for the enforcement of the award :—
“ In the District Court of Kurunegala
In the matter of an application for executionin terms of section 45 of the Co-operativeSocieties Ordinance (Cap. 107 as amendedby Act No. 21 of 1949) read with Rule38 (13) of the Co-operative Societies Rules,1950 (Published in Gazette No. 10,086 ofMarch 24, 1950).
Senanayake Mudianselage Arthur BandaSenanayake of Ginneriya-Wadakada inUdapola Medalasse Korale of DambadeniHat Pattu, Liquidator of the UdapolaCo-operative Stores Society.
Petitioner
Amount : Rs. 560/74.Vs.
Nature : Co-op. Award.
Procedure : Summary. Wijesundera Mudianselage Bandahamy Vel
Vidane of Udapola-Dewalepola in UdapolaOtota Korale of Dambadeni Hat Pattu.
Debtor-Respondent.
Senanayake Mudianselage Arthur Banda Senanayake of Ginneriya-Wadakada aforesaid, not being a Christian do hereby solemnly sincerelyand truly declare and affirm as follows :—
1. I am the Petitioner abovenamed.
No.Class :
316
BASNAYAICE, CJ.J.—Bandahamy v. Senanayake
I am the liquidator of tne Udapola Co-operative Stores SocietyLtd., which untifthe 9th day of March 1949 was a Co-operative Society,duly registered under the provisions of the Co-operative SocietiesOrdinance (Cap. 107 as amended by Act No. 21 of 1949) under No.KU/248 on the 10th day of January 1944 and had its registered officeat Kurunegala and carried on business at Udapola within the juris-diction of this Court. I was duly appointed liquidator of the saidsociety by order of the Registrar of Co-operative Societies dated 3rdDecember 1948 and I am now empowered to exercise the privileges andpowers of the said society in terms of sections 38 and 40 of the Co-operative Societies Ordinance (Cap. 107).
The purposes for which the said society was established are,inter alia for the sale of cloths and textiles and the business of thesaid society includes the sale of cloths and textiles, rice, sundries,groceries.
The Debtor-Respondent abovenamed was from 2nd day ofFebruary 1947 until the 19th day of March 1949 the treasurer and theperson in charge of cloth and textiles of the Petitioner society.
On or about the 19th day of March 1949, a dispute touching the
business of the Petitioner society arose between the Petitioner and theDebtor-Respondent within the meaning of section 45(1) of the Co-
operative Societies Ordinance (Cap. 107 as amended as aforesaid).The said dispute was whether the Respondent owes the said Petitionerthe sum of Rs. 560/74 consisting of leakages in textiles.
The liquidator of the said society in accordance with the provi-sions of sections 40 and 45 (1) of the said Ordinance (Cap. 107) andRule 38 (l) of the rules framed thereunder on the 21st day of May 1952referred the said dispute to the Registrar of Co-operative Societies fordecision.
Mr. T. P. Senanayake, Assistant Registrar of Co-operativeSocieties, acting in pursuance of the powers conferred on him byorder of the Minister published in the Government Gazette No. 10,115dated 30th June 1950, and made under section 2 (2) of the said Ordi-nance (Cap. 107) referred the said dispute for disposal to S. M. R. Banda,Circle Inspector, Polgahawela, who also acted as arbitrator in accor-dance with the provisions of section 45 (2) of the Co-operative Socie-ties Ordinance (Cap. 107).
The said arbitrator duly issued summons on the Respondenton July 22, 1952, to appear at the Inquiry into the said dispute on 19thAugust 1952 at 9 a.m. The matter was inquired into on 19th August1952 at 9 a.m. in the presence of the Respondent who did appear onbeing duly summoned as aforesaid, in accordance with Rule 38 (8)of the said Co-operative Societies Rules, 1950.
BASNAYAKE, C.J".—Handahamy v. Seiuinayake
317
On the 19th August 1952 the said Arbitrator duly made andannounced his award as required by Rule .38 (9) of the said Ruleswhereby he ordered the Respondent to pay the Petitioner a sum ofRs. 560/74 with interest thereon at the rate of 5% per annum. Acertified copy of the said award is filed herewith marked “ A
The Respondent did appeal to the Registrar of Co-operativeSocieties from the said Award and on the 24th March 1953 the saidappeal was dismissed by the said Registrar.
Notwithstanding the premises, the Respondent has failed andneglected to pay the said sum of Rs. 560/74 with interest and coststo the Petitioner, though demanded.
The Petitioner is accordingly entitled to apply to this Courtto have the said Award dated 19th August 1952 enforced in the samemanner as decree of this Court in accordance with the provisions ofRule 38 (13) of the Co-operative Societies Rules, 1950.
Sgd. A. B. Senanayake,
Affirmant. ”
The first question for decision on this appeal is whether the liquidator,who is empowered by section 40 (1) {d) to “ refer for arbitration undersection 45 any dispute of any description mentioned in that section ”,acted in accordance with the statute in adopting the course ho took.
I am of opinion that he did not so act. The words “ refer for arbitration ”cannot in my view mean “refer to the Registrar for decision ” undersection 45. They can only mean what they say, that is, refer to an arbi-trator for arbitration. The words “refer for arbitration ” also occur insection 41 (h), and it is not disputed that in that section they mean referto an arbitrator for ai'bitra tion. The words “not being a dispute soreferable under section 40 (1) (<7) ” are an indication that the Legis-lature used the words “ refer for arbitration ” in both contexts in the samesense. I agree with the submission of learned counsel for the appellantthat the words “ under section 45 ” do not attract the entire machineryof that section, but only that portion of it which deals with referenceto an arbitrator. It enables the liquidator, as was submitted by learnedcounsel, to refer a dispute for arbitration compulsorily and without theconsent of parties. The reference to arbitration, in the instant case, notbeing in accordance with the statute, the award is not such an awardas is declared to be final by section 45 (5), and is not enforceable in themanner provided in Rule 38 (13) of the Co-operative Societies Rules 1950published in Gazette No. 10,086 of 24th March 1950.
The second question for decision is whether the liquidator had powerto refer for arbitration under section 40 (1) {cl) as amended by section 9of Act No. 21 of. 1949 a dispute which had arisen before the date on whichthat Act came into operation. The dispute in the instant case aroseon 19th March 1949 and the amending Act came into operation on 24thMay 1949. But by -section 2 of the Co-operative Societies (Special
2*J. X. It 14700 (I2/G0)
318
BASNAYAKE, C.J.—Bandahamy v. Senanayake
Provisions) Act No. 17 of 1952 retrospective operation was given tocertain provisions of the amending Act. The question for considerationis whether section 40 (1) (d) has retrospective operation by virtue of thatAct. Section 2 reads (omitting the provisos which are not relevant tothe present discussion)—
“ (1) Section 45 of the Co-operative Societies Ordinance (hereinafterreferred to as * the principal enactment ’) shall apply in the case of everydispute of any description referred to in that section as amended byAct No. 21 of 1949 notwithstanding that the dispute may have arisenprior to the date on which that Act came into operation.
“ (2) Every reference of a dispute of any description mentionedin section 45 of the principal enactment, as amended by Act No. 21of 1949, which may heretofore have been made in purported pursuanceof the provisions of that section as so amended shall be and bedeemed to have been as valid and effectual as though subsection (1)of this section had been in force at the time the reference was made ;and the provisions of subsections (2) to (5) of the aforesaid section 45shall apply and be deemed to have applied accordingly : ”
The material words of subsection (1) are : "Section 45 of the Co-operative Societies Ordinance shall apply ”, and of subsection (2) :“ Every reference of a dispute of any description mentioned in section45… and the provisions of subsections (2) to (5) of the aforesaid
section 45 shall apply and be deemed to have applied accordingly ”.Having regard to the language of those provisions I do not think thatthey have the effect of giving retrospective operation to any section otherthan section 45. The fact that section 40 (1) (cl) contains a referenceto section 45 does not bring that section within the ambit of section 2 andgive it retrospective effect.
The power to make a reference to arbitration is conferred on a liquidatorby section 40 (1) (d). In its amended form it contains a reference tosection 45. Subsection (2) refers to disputes of “ any description ”mentioned in section 45 “ which may heretofore have been made inpurported pursuance of the provisions of that section as so amended. ”Now the dispute in the instant case has not been refeired to arbitrationin pursuance of section 45 as amended but under the powers granted to aliquidator under section 40 (1) (d). The submission of learned counselthat section 40 (1) (d) as amended by Act No. 21 of 1949 does not applyto the reference to arbitration of a dispute which arose before that Actis entitled to succeed. Clearly under the section as it stood before theamendment the liquidator had no power to refer a dispute to the Registrarfor decision. His power was to refer to an arbitrator for arbitration.That power remains unaffected by the Acts of 1949 and 1952.
The third question is whether the award is ** ex facie regular ”. Withgreat respect to my brother Pulle, it is not clear what exactly he meantwhen he said ** If an award is ex facie regular ”. I have not been able
BASNAYAKE, C.J.—Barulahamy v. Senana.ya.lre
319
to discover in the many legal dictionaries X have referred to a definitionof the expression “ ex facie ”. Webster’s New International Dictionarygives the following meaning:— “ “From the face; on its face—ofdocuments, titles etc.” According to the same dictionary “regular”means “ formed, built, arranged etc. according to some established rule,law, principle or type ; harmonious in form, structure etc.—constituted,selected, conducted, made etc. in conformity with established or pres-cribed usages, rules or discipline, duly authorized or constituted ”.Black’s Daw Dictionary defines it as “ Made according to rule, dulyauthorised, formed after uniform type, built or arranged according toestablished plan, law or principle. ”
Having regard to the meanings of the words “ex facie ” and “ regular”given above, what was meant by “if an award is ex facie regular” appearsto be “ If the document produced in court as an award contains statementswhich show that it was validly made by an arbitrator properly appointedin accordance with the Co-operative Societies Ordinance and its rulesthen the court need not look elsewhere. ” When the Judge examinesthe award for the purpose of ascertaining whether it is “ ex facie regular ”he does not approach it with a blank mind even if it were possible to doso. If he is not familiar with the provisions of the Co-operative SocietiesOrdinance he would have to examine the sections cited therein unlessthe award quotes them in extenso. He would have to construe themin order to ascertain their meaning and decide whether the award is inconformity with them, so that a reading of the award alone will not,unless it is a self contained document, convey to the reader the fact -that it has been duly made in accordance with the statute.
The award in the instant case is on a printed form, the blanks of whichhave been filled in handwriting presumably by the arbitrator. In theaward reproduced below the portions in handwriting are underlined :
“ AWARD
UNDER SECTION 45 OE ORDINANCE No. 16 OE 1936 (CAP. 107)AS AMENDED BY ACT 21 OF 1949.
Whereas the following matter in dispute between theliquidator of
Udapola Co-operative Stores Society Ltd., A. B. Senanayake, plaintiff,
and Wijesundra Mndivanselago Bamlahamy, defendant namely,
whether the said defendant owes to the said plaintiff the sum of Rupees
Five hundred and sixty and cents seventy-four consisting of * V
Its. c.
Leakage in liabilities (2.2.47—30.4.48).. 493 35
„„„(1.3.48—19.3.49)..67 39
V •«••■■••*•■••
TOTAL . .560 74
320BASNAYAKE, C.J.—Bandahamy v. Senanayake
has been referred to me for determination by the order of the AssistantRegistrar of Co-operative Societies, North Western Province, dated
10th June 1952 I having duly considered the matter, do herby direct thatthe said Wijesundara Mudiyanselage Bandahamy pay the said Liquidatorof Udapola Co-operative Stores Society A. B. Senanayake a sum ofRupees "Five Hundred and sixty and seventy-four cents (Rs. 560.74),and Rupees … costs, or Rupees Rive hundred and sixty and cents
seventy-four (Rs. 560.74) in all, together with interest on the principal * *
sum awarded at tne rate of 5% per cent, per annum until the realizationof the sum awarded.
The above amount shall be paid by 20th September 1952 ; if it isnot so paid, the amount may be realized through a civil court.
Award given in the presence of—
*
Sgd. H. HerathbandaSgd. A. B. Senanayake,
PLAINTIFF
2. Sgd. IllegiblySgd. ©-©SQaeoa®,
DEFENDANT
Sgd. S. M. A. Banda,
ARBITRATOR
Dated : 19.8.52.
Appeal, (if any)
Date of Receipt of Appeal : 16.9.52 by W. M. Bandahamy
Registrar’s Order.—See overleaf.
Registrar’s Order in Appeal:—
No. C/ A/NWP. 377
I have carefully considered the appeal from the decision of theArbitrator. On the evidence placed before the Arbitrator, his decisionis fair and reasonable and I see no reason to vary the award which ishereby affirmed. The appeal is dismissed.
Sgd. S. C. Fernando,
Deputy Commissioner of Co-operative Development &Deputy Registrar of Co-operative Societies.
Colombo, 24.3.53. ” ’
The award does not show that it was made in accordance with the statuteand that it is a valid award. The indications on the document are to thecontrary. There is no reference to section 40 (1) (d). The only section
BAiSNAYAKE, C.T.—JZarvln.hn.my v. Setxnnaynlce.
321
mentioned is section 45 and that section does not empower the Registrarto refer for disposal to an arbitrator a dispute between a liquidator andanother. Apart from that the award does not say who WijesunderaMudiyanselage Bandahamy is, whether he is a member of the society,past member, employee, past employee, officer or past offi.er, or heiror legal representative of any such person. It conveys the informationthat the society is in liquidation but it does not explain why the Registrarand not the liquidator has made the reference to arbitration. It alsodoes not disclose that the defendant belongs to one of the classes ofpersons mentioned in section 45. Learned counsel’s contention on thispoint too is entitled to succeed even adopting the test of an “ awardex facie regular ”.
I now come to the procedure that should be adopted in the enforcementof a valid award. The Rule 38 (13) provides that a decision or an awardshall on application to any civil court having jurisdiction in the area inwhich the society carries on business be enforced in the same manner as adecree of such court. This matter is covered by previous decisions ofthis court. In Jayasinghe v. Boragodawatla Co-operative Stores 1 a benchof three Judges adopted with approval the decision in Barnes de Silva v.Galkissa Watlarappola Co-operative Stores Society2. I agree with thedecision in Jayasinghe's case (supra) and I said so in my judgment inPinikahana-ICahaduwa Co-operative Society Ltd. v. Herath 3. The fol-io wing observe tions of my brother Pulle in his judgment in the Pinikahanacase (p. 149) (supra) :
“ If an award is ex facie regular, the court in which it is sought toexecute it as a decree has no jurisdiction to test its validity, for, if itdoes so, it would plainly be in breach of the prohibition contained insection 45 (4) ”.
cannot be reconciled with the decision in Barnes de Silva's case (supra)unanimously adopted with approval in Jayasinghe's case.In the former
case Gratiaen J. said :
“ This rule, the validity of which may be assumed for the purposesof the present appeal, does not lay down the procedure for making suchapplications, but it is the clear duty of a Court of law whose machineryas a court of execution is invoked to satisfy itself, before allowingwrit to issue, that the purported decision orawardis prima facie a validdecision or award made by a person duly authorised under the Ordi-nance to determine a dispute which has properly arisen for the decisionof an extra-judicial tribunal under the Ordinance. In that eventalone would the Court be justified in holding that the decision oraward is entitled to recognition and capable; under the appropriaterule, of enforcement as if it were a decree of Court ”. 1
1 {1955) 50 X. L. Tt. 402.
3 {1957) 59 N. L. R. 145.
2 {1953) 54 K. L. R. 320.
322
RASTJAYATTR, C.J.—Bandahamy v. Senanayake
following the principles laid down in the above quotation in Jayasinghe'sease {supra) the order of the District Judge was set aside, because thesociety which sought to enforce the award had placed no evidencebefore the court to establish its validity. It was held for that reasonthat the application was void ab initio.
Learned counsel submitted that my brother Pulle’s observations wereobiter and were therefore not binding as against the decision by twoJudges in Barnes de Silva's case {supra) approved by the unanimousdecision of three Judges in Jayasinghe's case {supra). I think there issubstance in learned counsel’s submission. As I am one of the Judgeswho heard the Pinikahana case {supra) I am in a position to say that thequestion for the decision of which the bench of five Judges was constitutedwas the validity of Rule 38 (13). The judgments of both my brotherPulle and myself are almost entirely devoted to a discussion of thevalidity of the rule. It is only in passing that other questions are re-ferred to. My brother’s observations made without any reference toJayasinghe's case {supra) were made by the way and are not necessaryfor the decision of the question for which a bench of five Judges wasassembled. An.observation such as that of my brother Pulle does nothave the effect of overruling the considered decision in Jayasinghe'scase even if three out of five Judges have the power to overrule the unani-mous decision of a bench of three Judges. It is well settled that a caseis only an authority for what it actually decides {Quinn v. Leathern)1.The only decision of authority, on the question whether, before enforcingas a decree of the court an award brought to it in pursuance of Rule38 (13), the court has power to satisfy itself that the award which isbrought to it for enforcement is a valid award made by a person dulyauthorised by the Ordinance to determine a dispute which has properlyarisen for the decision of an extra-judicial tribunal under the Ordinance,is Jayasinghe's case with which I am in entire agreement.
• As learned counsel on both, sides have addressed us at length on the■doctrine or principle of stare decisis it is necessary, before I part with thisjudgment, to discuss that topic. 'The decision of an ultimate or appellatecourt has a dual aspect^ The decision of the dispute between the partiesand the principles of law which the court lays down in deciding thatdispute. The actual decision of the dispute binds the parties. Aboutthat there is no question. The principles of law guide the court indeciding similar disputes, and most courts of appeal and of ultimatejurisdiction regard themselves as bound by the principles enunciated by■them in their decisions. The first aspect concerns the parties, thesecond the public, the profession and the subordinate courts and tribunalsbound or influenced by those decisions. The principle of la w which guidesa court of ultimate or appellate Jurisdiction in arriving at its decisionin the case before it, is for convenience called the ratio decidendi of the case(the reason of or for decision). The expression may be taken as meaning“ the reason for the order that the court makes ” or ec the reason or groundon which a judgment is rested
1 (J901) A. C. 495 at 506.
BASNAYAJCE, C..T.—Btvndnhnmy v. Senanaynke
323
W© are here concerned with the aspect of a judgment or decisionswhich serves as a precedent or guide in deciding similar disputes in futurewhich has come to be known as stare decisis. Stare'decisis means toadhere to or to abide by previous decisions. It is the principle whichrecognises that “ a deliberate or solemn decision of court made afterargument on question of law fairly arisen in the case, and necessary toits determination, is an authority, or binding precedent in the same court,or in other courts of equal or lower rank in subsequent cases where thevery point is again in controversy ” (Black’s Law Dictionary). It islimited to actual determinations in respect of litigated and necessarilydecided questions, and is not applicable to dicta or obiter dicta.
“ Precedent ” is another expression that figures largely in a discussionof the binding effect of judgments. What does it mean ? According tothe Oxford Dictionary it means “ a previous instance or case which isor may be taken as an example or rule for subsequent cases, or by whichsome similar act or circumstance may be supported or justified.” Nowthe tendency to follow precedent is not confined to the Ccurts. T.nmany departments of life we look to precedent for guidance. In somewe rigidly adhere to precedent, in others we pay respect to it but occa-sionally depart from it for good reason.
This principle finds recognition in Roman Law but not to the sameextent as at present in England and other Commonwealth countries.Except in the case of Imperial decrees or judgments in Roman Lawjudicial precedent had not the same binding authority as in modernAnglo-American Law. In Roman-Dutch Law too precedent was recog-nized but there was no rigid unquestioning adherence to it. The placeof precedent in that system is admirably summed up by Sir John ICotzein his contribution to the South African Law Journal of 1917 at p. 2S5—
i * “ Precedent, therefore, was recognized in Roman-Dutch Law, andwas not without authority in the adjudication of subsequent cases.That is apparent from an examination of the decisions of the Courtsand the treatises and published consultations of the jurists. Myfriend, Sir John Wessels, rightly reminds us that these decisions andconsultations of the Dutch jurists have played a most important partin the formation and development of Roman-Dutch Law ; but he hasput the case too strongly when he asserts that the decisions of theDutch Courts, as coming from Judges appointed by the sovereignpower, are regarded as decisive interpretations of the law, and arebinding on all until amended or altered by some legislative enactment.That is the language of the English common law, not of the Roman-Dutch Law, for no Dutch Court or jurist has assigned to precedent anauthority so high as that, placing as it were the binding effect of thedecisions of the Supreme Courts of the various Provinces of the'Netherlands on the same plane as the judgments of the House cfLords inEngland. It is clear from the opinion of Coren, Sande, Van der Lindenand others, and also from the Dutch decisions themselves, that Roman-Dutch Jurisprudence, while it recognizes the value'of certainty in
324
BASIN’ AY AKE, C.J.—Bandahamy v. Senanayake
judicial sentences, and inculcates the precept that previous decisionsshould not be lightly departed from, also teaches the principle that aprevious decision, which has been shown to be erroneous, ought notto be followed. Higher than that the doctrine cannot with accuracybe put. The rules stare decisis and communis error facit jus were notnourished in Roman-Dutch Jurisprudence.”
The judicial precedent is not given the same place in all countries.In the Continental (European) countries and those which have adoptedtheir system of law judicial precedent is not regarded in the same wayas in countries that have adopted the English system. The continentalsystem attaches more importance to rules established by judicial practicethan to a rule established by an individual case. A useful discussion ofthe place of precedent in English and Continental Law is to be found inProfessor Goodhart’s “ Precedent in English and Continental Law ”.Even in the Anglo-American group of countries the rule is not uniformlyapplied. Some apply it in all its rigour while others give it flexibility.Still others exclude it altogether as in the case of Israel which has evengone to the extent of prescribing by statute that the Supreme Courtshall be bound by precedent. I shall quote section 33 of the Courts Law19^7 which reads :—
(а)A court shall be guided by a precedent established by a higher
Court.
(б)A precedent established by the Supreme Court binds every
court, except the Supreme Court.”
Every Supreme Court in the Commonwealth of Kations as well asAmerica recognises this principle or doctrine, but all not with the samezeal. Some jurisdictions regard it as inflexible while others as subject toexceptions. The early American view point which has not undergoneappreciable change is thus expressed in Kent’s Commentaries, Vol. Ip. 476 (12th Edn. 1896), as follows :—
“ A solemn decision upon a point of law, arising in any given case,becomes an authority in a like case, because it is the highest evidencewhich we can have of the law applicable to the subject, and the judgesare bound to follow that decision so long as it stands unreversed,unless it can be shown that the law was misunderstood or misappliedin that particular case. If a decision has been made upon solemnargument and mature deliberation, the presumption is in favour ofits correctness ; and the community have a right to regard it as a justdeclaration or exposition of the laAv, and to regulate their actionsand contracts by it …. When a rule has been once deliberately
adopted and declared, it ought not to be disturbed, unless by a courtof appeal or review, and never by the same court, except for very cogentreasons, and upon a clear manifestation of error ; and if the practicewere otherwise, it would be leaving us in a state of perplexinguncertainty as to the law.”
B ASN- AYAKTC, C–T-—Bandahumy v. Senanayake
32.",
The learned commentator goes on to say—
“ But I wish not to be understood to press too strongly the doctrineof stare decisis, when I recollect that there arc more than one thousandcases to be pointed out in the English and American books of reports,which have been over-ruled, doubted, or- limited in theii application.It is probable that the records of many courts in this country are repletewith hast}' and crude decisions ; and such cases ought to be examinedwithout fear, and revised without reluctance, rather than to have thecharacter of our law impaired, and the beauty and harmony of thesystem destroyed by the perpetuity of error.”
The Federal Supreme Court of the United States of America is oneof those Courts that treat the rule as flexible. It has not yet acceptedthe view of Sir Frederick Pollock that “ they must not reverse whathas been settled. Only express legislation can do that” (3-1 A.B. A. J.804). Nor has it accepted the view expressed by Lord Eldon in Sheddonv. Goodrich 1 “It is better the law should be certain, than that ever}’Judge should speculate upon improvements in it ” (34 A. B. A. J. 1029).There are individual American Judges who have expressed support forthe inflexible application of the rule. For instance Chief Justice Taftsaid “ It is more important to stand by the Court and give its judgmentweight than merely to record …. individual dissent when it isbetter to have the law certain than to have it settled either way ” (35A. B. A. J. 224).
At present the Supreme Court of Canada is tending towards a lessrigid application of the principle. It has recently 'indicated a desire tofree itself of the tyranny of rigidity. Rand J. observed in the caseof Reference, re the Farm Products Marketing Art2 :—
“ The powers of this Court in the exercise of its jurisdiction arc noless in scope than those formerly exercised in relation to Canada by theJudicial Committee. From time to time the Committee has modifiedthe language used by it in the attribution of legislation to the variousheads of ss. 91 and 92, and in its general interpretative formulations,and that incident of judicial power must, now, in the same manner andwith the same authority, wherever deemed necessary, be exercised inrevising or restating those formulations*that have come down to us.This is a function inseparable from constitutional decision. It involvesno departure from the basic principles of jurisdictional distribution ;it is rather a refinement of interpretation in application to the parti-cularized and evolving features and aspects of matters which theintensive and extensive expansion of the life of the country inevitablypresents.”
What appears to my mind a more enlightened approach to stare decisishas been developing in South Africa. I shall therefore quote extensivelyfrom the judgments which seek to make stare decisis a useful doctrine
1 S Ves. 497.
– (1957) 7 D. L. JR. 257 at 271.
326
VYAK^l, C.J.—Bandahamy v. Senanayake
designed to stabilise the law but not to hamper its development. Thefirst of the cases- in chronological order is Habib Motan v. TransvaalGovernment1. In that case Innes C.J. said :—
“ Stare decisis is a good maxim, and one to be generally followed,but it is conceivable that circumstances may arise which would renderit a lesser evil for a court to override its own legal opinion, clearlyshown to be wrong, than indefinitely to perpetuate its error. Andthe mere fact that one judgment reverses an earlier one upon a pointof law will not render the second judgment invalid. Save under themost exceptional circumstances, however, a court of law should bebound by its own decisions unless and until they are overruled by ahigher tribunal on appeal. To adopt any other rule would impair thedignity of the court, and would introduce a fatal uncertainty intobusiness transactions and legal proceedings.”
In the later case of Rex v. Faithfull and Gray 2 in which the previousdecision of Dexter v. Rex 3 was overruled, Solomon J. who was also amember of the bench which decided Habib Motan's case observed—
“ It seems to have been assumed (in Dexter v. Rex) on all hands, bothby counsel for the Crown and by the Court, that the evidence givenby one prisoner could not be used against his fellow-prisoner. As faras I remember, the Proclamation was not examined, nor were anyauthorities on the point quoted. That being so, I think it is open tous now to reconsider that decision, and it is quite competent for thisCourt to overrule its previous decision …. stare decisis is a goodrule to follow. But where a court is satisfied that its previous decisionwas wrong, and more particularly where the point was not argued,then I think it is not only competent for the court, but it is its duty insuch a case not to abide by its previous decision, but to overrule it.”
In Collett v. Priest4 De Villiers C.J. while expressing the view thatstare decisis is a “ sound principle ” and one which has been adopted inSouth African practice stated :—
“ But when once the meaning of words in a section of an Act ofParliament has been authoritatively determined by this Court thatmeaning is the meaning which has to be given to those words in thatsection by all the Courts in the land. Even this Court is bound andcannot depart from the meaning so laid down except when it is clearto the Court that in doing so it erred.”
Stratford J.A. expressed a different view in Bloemfontein Tenon- Cemncilv. R ichter 5 :—
“ The ordinary rule is that this Court is bound by its own decisionsand unless a decision has been arrived at on some manifest oversightor misunderstanding, that is, there has been something in the nature
1 (1904) T. S. 404 at 413.3 (1904) T. S. 243.
» (1907) T. S. 1077 at 1081.4 (1931) A. D. 290.
* (1938) A. D. 195 at 232.
BASNAYAKK, C.J.—Ban.dnfia.vntj v. Sannnaynke
327
of a palpable mistake, a subsequently ronstituted Court has no right toprefer its own reasoning to that of its predecessors—such preference,if allowed, would produce endless uncertainty and confusion. Themaxim stare decisis should, therefore, be more rigidly applied in thisthe highest Court in the land, than in all others.”
In Rex v. Nxnmald1 Watermcyer J.A. differed from the theory ofrigid application of stare decisis. He said :—
“ It is true that as a general rule this Court is bound to follow itsprevious decisions. But to that rule there are 'certain recognisedexceptions.”
After examining the different views I have indicated above Centlivres
J. in the case of Harris and Others v. Minister of the Interior and another2said :—
” I do not consider it necessary or desirable to formulate exhaustiverules as to the circumstances in which this Court should decline, onits being shown that a previous decision of its own was wrong, tofollow that decision. This Court is naturally very reluctant to departfrom one of its own decisions, especially in cases where that decisionhas been acted on fox’ a number of years in such a manner that rightshave grown up under it. My conclusion is that this Court is bound toconsider any reasons that may be advanced to show that its previousdecision in Ndhvana's case was wrong.”
In refusing to follow the previous decision referred to the Chief Justicesaid at p. 471 :—
“ It seems to me with great respect that this Court per incuriampronounced a decision on a question of vital constitutional importancewithout hearing argument for and against the main conclusion atwhich it arrived. Even if it did hear any argument on this vitalquestion, that argument lasted a very short time. The records of thisCourt show that counsel for the appellant argued from: 10.5 a.m. to11 a.m., that counsel for the respondent argued from 11 a.m. to 11.15a.m. and that counsel for the appellant replied from 11.15 a.m. to 11.25a.m. (This short argument contrasts strangely with the argumentin this case which lasted six days.) The Court then adjourned for35 minutes and on re-assembling at noon announced that the appealwas dismissed and tbat reasons would be handed in later.
“ I have carefully examined the record.which was before this Courtwhen it heard Ndlwana’s case and it is clear that there was not placedbefore this Court on that occasion the mass of material which counselon both sides placed before this Court in the present case.”
A. B. 5S0 at 5S6.
2 {1052) 2 S. A. B. Tt. 42S at 454.
328
BASNAYA35LB, C.J.—Bandahamy v. Senanayake
Xu the later case of John Bell <Sa Go. Ltd. v. Esselen1 Centlivres C.J. wentfurther in refusing to follow the Privy Council decision in the Ceyloncase of John ds others v. Dodwell <Ss Go. Ltd.2 on the ground that noRoman-Dutch authorities were cited in the argument or considered inthe judgment **. He went on to explain the position of the AppellateDivision vis a vis the Privy Council thus :—
“ I shall assume that this Court would have been bound by thedecision in John’s case prior to the passing of Act 16 of 1950 whichabolished appeals to the Privy Council from any judgment of thisCourt given on an appeal from any Court in the Union or South-WestAfrica. In the present case, which is an appeal from a court in theUnion, there can be no further appeal to the Privy Council. ThePrivy Council is not bound by its own decisions and it regards itselfas free to depart from one of its own previous decisions, if its attentionwas not drawn in the previous decisions to relevant authorities. SeeHarris and Others v. Minister of the Interior and Another ((1952) 2 S. A.4-28 at 453 and 454 (A. D.)). As this Courtis now the final Court in respectof appeals from courts in the Union, it must naturally have the power,which the Privy Council had and which it does not now have in respectof these appeals, of departing from an erroneous decision of the PrivyCouncil.”
In Fellner v. Minister of the Interior3 these views were reiterated.
So much for South Africa. I now come to Australia. The highestcourt of that country inclines more than South Africa towards the Englishattitude being a country whose laws are derived for the most part fromEngland,' but there are numerous decisions of the High Court of thatcountry in which previous decisions have net been followed. The atti-tude of the Court is reflected in the remarks of Issues J. in AustralianAgricultural Go. v. Federated Engine-Drivers and Firemen’s Associationof Australasia* where after reviewing the numerous decisions on the pointhe says : “ It is not in my opinion better that the Court should be per-sistently wrong than that it would be ultimate^7 right. ” Higgins,Gavan Duffy and Rich JJ. all agreed that it was the duty of the Court tooverrule an erroneous previous decision. In the following year theHigh Court affirmed this Jurisdiction to overrule its own decisions in
R.v. Court of Conciliation ; Exparte Brisbane Tramways Board5 whereBarton J. said—
“ I have never thought that it was not open to this Court to reviewits previous decisions upon good cause. The question is not whetherthe Court can do so, but whether it will, having due regard to theneed for continuity and consistency in judicial decision. Changesin the number of appointed justices can, I take it, never of themselvesfurnish a reason for a review …. But -the Court can always
1 (1954) 1 S. A. L. R. 147.3 (1954) 4 S. A. L. R. 523.
* (1918) A. G. 563 ; (20 N. L. R. 206).'4 (1913) 17 G. L. R. 261.
(1914) 18 C. L. R. 54 at 69. ■
BAf NAYAKE,t>. Sryimuiyakr.
329
listen to argument as to whether it sought to review a particular deci-sion, and the strongest reason for an over-ruling is that a decision ismanifestly wrong, and its maintenance is injurious to the publicinterest. ”
In the later case of Perpetual Executors and Trustee Association of AustraliaLtd. v. Federal Commissioner of Taxation. 1 Latham C.J. quoting withapproval the above words of Barton J. said :
“ Continuity and coherence in the law demanded that, particularlyin the High Court, which was the highest Court of Appeal in Australia,the principle of stare decisis should be applied, save in very exceptionalcases.
“ The court was not bound by its previous decisions so as absolutelyto preclude reconsideration of a principle approved and applied in aprior case, but, as was stated in Cain v. Malone (1942) 66 C.L.R. 10,the exceptions to the rule were exceptions which should be allowedonly with great caution and in clear cases. ”
The attitude of New Zealand is much the same as that of Australia.It is sufficient to refer to the case of In re Rayner 2 where the questionwas whether the majority judgment in In re Houghton should be followedor not. In that case Justice Bair said :
“ In my view, the decision in Young v. Bristol Aerojdane Co. Ltd.is a decision as to the practice of the Court of Appeal in England. Itis not a determination of a question of law in the ordinary sense,but on constitutional practice. The Court of Appeal in New Zealandoccupies a position in the judicial hierarchy which differs very mate-rially from that of the Court of Appeal in England. Owing to theexpense and delay entailed by an appeal to the Privy Council, in generalonly a wealthy person ean take the risk of the heavy costs in which hewould be involved in the event of his appeal being unsuccessful, and thenumber of appeals is small. It consequently follows that the Courtof Appeal is, in effect, in nearly all cases, the final Court in Hew Zea-land. In such circumstances, the principle of the decisions indicatingthat a Court from which there is no appeal is not bound by decisionsof Courts of co-ordinate jurisdiction may require consideration. ”
Thereafter he went on to say :
“ It seems that there should be a means of correcting a decisionwhich is obviously erroneous, even at the possible risk of such powerinvolving uncertainty in the construction of the law. ” *
i 24 A. L. J. 144.
* (1948) N. Z. It. 455.
330
BASK’AYAKE, C.J.—JBandahamy v. Senanayake
Finlay J. said (at p. 505) :
“ In Australia and New Zealand'Uvhe view has obtained for manyyears that the superior appellate tribunal in each of these countriescan overrule an earlier decision of its own. In New Zealand theappellate tribunal sits in divisions, and the view has obtained that thejurisdiction to overrule the previous decisions of one Division shouldbe limited to what has been defined as ‘ a full Court of appeal ’—thatis, a sitting of the Judges of both divisions together .”
Justice Callan said (at p. 487) :
“ The judgment of this Court in In re Houghton, McClurg v. NewZealand Insurance Co. Ltd. (1945) N. Z. L,. R. 639 was contrary to thecurrent of New Zealand authority theretofore existing, and should notbe followed if this Court is free to differ from it.
“ This Court is free so to do because In re Houghton is, in principle,in conflict with the decision of the House of Dords in O'Grady v. Wilmot(1916) 2 A.C. 231. ”
Justice Cornish added (at p. 509) :
“ After all, the matter is only one of practice ; and I can see no reason(other than stare decisis) why both Divisions, if satisfied that a judgmentof one Division is not in the true line of authority, should not declineto be bound by it. Any other course would impose on litigants aburden either of expense or delay (or both) of carrying to the PrivyCouncil an appeal which the majority of all the Judges of the SupremeCourt and Court of Appeal in this Dominion thought they ought notto carry. It is fairer that the burden of an appeal to the PrivyCouncil should be on the party who seeks to uphold a decision that thetwo Divisions have rejected. ”
India, being a country in which the influence of the English legal systemhas prevailed for well over a century, regards judicial precedent withthe same veneration as England. Before the establishment of theFederal Supreme Court in the pre-in dependence period appeals from thevarious High Courts lay direct to the Privy Council and all High Courtsconsidered themselves as absolutely bound by the decisions of the PrivyCouncil. On the establishment of the Federal Supreme Court appealsin certain matters lay to that Court from the High Courts and thenceto the Privy Council. The Federal Supreme Court was absolutely boundby the decisions of the Privy Council to which appeal lay From its decisionand it also considered itself bound by its own precedentseven when the opinions expressed were advisory opinions. The observa-tion of Maurice Gwyer C.J. in Madras Province v. Boddu Paidanna <£:Sons1 are relevant. He said :
“ In 1939 F. C. R. 18 the opinions expressed were advisor}' opinionsonly, but we do not think that we ought to regard them as any lessbinding upon us on that account. ”
1 (1942) A. I. R. (F. C.) p. 33 at 35.
BASTSTAYAKE, C-T.—Bandahamy v. Senanayakc
331
The different High Courts were absolutely bound by the decision of theFederal Court as they were by the decisions of the Privy Council, thedecisions of the latter body having preference in case of clash of decisions.The subordinate courts of each region for which a High Court is estab-lished are bound absolutely by the decisions of the High Court. Butone High Court was not bound by the decisions of another High Court.In each High Court itself the decisions of a Full Bench were regardedas absolute^ binding on a bench consisting of less than a full bench andthe decisions of a numerically superior bench were regarded as bindingon a numerically inferior bench. The Indian view is expressed in thefollowing words of Coutts-Trotter J. in Jtukmani Ammal v. Narasinimalyerr :
c* …. in matters of procedure it is most advisable that thepreponderance of authority in this Court should be followed, evensupposing that if the matter were res Integra one might come to adifferent conclusion. ”
The views of the same Judge in Satyanarayana. v. Veeranki China Ven-Icatarao cf? others2- indicate the Indian approach to the principle of staredecisis—
c< In a matter which is open to divergence of view ray opinion is thatthis Court should follow its own cursus curiae unless it is of the opinionthat the former decisions of the Court are clearly wrong. ”
The establishment of the Supreme Court of India in the post inde-pendence period and the abolition of appeals to the Privy Council havecaused no change except that the decisions of the Supreme Court nowbind the High Courts absolutely. The Supreme Court regards itselfas bound by its own decisions subject tc tbeir being overruled by benchesof greater numerical strength. Pakistan does not. call for detailedreference as the principle is the same in that country.
Lastly I wish to refer to the application of this doctrine or principleas some choose to call it in ^England where it is applied more rigidlythan in the countries I have referred to above. Blaokstone states(Vol. I p. 70) :
“ The doctrine of the law then is this, that precedents and rulesmust be followed, unless flatly absurd or unjust. **
In its application to decisions of the House of Lords and the Court ofAppeal the same rules have not been observed. The rule in regard tothe House of Lords is rigid and in regard to the Court of Appeal andother Courts not as rigid. The attitude of the House of Lords i best
1 {1921) Madras 612-al G15.
* {192G) A. I. It. Madras 530.
332
BASNAYAJKLE, C.J.—-Bartdahamy v. Senanciyake.
shown in the case of London Street Tramways Co. Ltd. v. London CountyCouncil1. Lord Halsbury at p. 380 enunciated it as applying to the finalCourt of Appeal thus :
•“ ]£y Lords, it is totally impossible, as it appears to me, to disregard
rt^L^ ,whole current of authority upon this subject, and to suppose that? ydiAt, some people call an ‘ extra-ordinary case an ‘unusual case’,
. a pase somewhat different from the common, in the opinion of eachlitigant in turn, is sufficient to justify the re-hearing and re-arguingbefore the final Court of Appeal of a question which has been alreadydecided. Of course I do not deny that cases of individual hardshipmay arise, and there may be a current of opinion in the profession thatsuch and such a judgment was erroneous, but what is that occasionalinterference with what is perhaps abstract justice as compared with theinconvenience—the disastrous inconvenience—of having each questionsubject to being re-argued and the dealings of mankind rendereddoubtful by reason of different decisions, so that in truth and in factthere would be no real final Court of Appeal My Lords, ‘ interestrei publicae * that there should be ‘ finis litium ’ at some time, andthere could be non ‘ finis litium ’ if it were po.ssible to suggest in eachcase that it might be re-argued, because it is ‘ not an ordinary case ’
whatever that may meanUnder these circumstances
it appears to me that Your Lordships would do well to act upon thatwhich has been universally assumed in the profession, so far as I know,
1 to be the principle, namely, that a decision of this House upon a questionof law* is conclusive and nothing but an Act of Parliament can set rightthat which is alleged to be wTong in a judgment of this House. **
There has been no change of attitude since the above words were ex-pressed although in the early days the rule was not so rigidly applied.(See JCotze Judicial Precedent, 34. S. A. L. J. 298-299.)
In regard to the Court of Appeal the ruling case is Young v. BristolAeroplane Co., Ltd. 2. There Greene M.R. laid down the followingpropositions :
*' In considering the question whether or not this court is bound byits previous decisions and those of courts of co-ordinate jurisdiction,it is necessary to distinguish four classes of cases. Tire first is thatwith which we are now concerned, namely, cases where this court findsitseff confronted with one or more decisions of its own or of a courtof co-ordinate jurisdiction which cover the quest'on before it, andthere is no conflicting decision of this court or of a court of co-ordinatejurisdiction. The second is where there is such a conflicting decision.The third is where this court comes to the conclusion that a previousdecision, although not expressly overruled, cannot stand with a subse-quent decision of the House of Lords. The fourth (a special case)is where this Court coines to the conclusion that a previous decisionwas given per incuriam. In the second.and third classes of case it isi {1898) A. C. 375.* {1944) 2 All E. R. 293.
BAfNAYAKE, C-J-—JBandahatny v. Setuina-yake
333
beyond question, that the previous decision is open to examinationIn the .second class, the court is unquestionably entitled to choosebetween the two conflicting decisions. In the third class of case thecourt, is merely giving effect to what it considers to have been a decisionof the House of Lords by which It is bound. The fourth class requiresmore detailed examination and we will refer to it again later in thisJudgment. ”
In referring to the class last mention'd the learned Master of the Rolls
said
“ It remains to consider Lancaster Motor Co. (London) Ltd. v.Brcmith Ltd. (1941) 2 All E. R. 11, in which a court consisting of SirWilfrid Greene M.R., Clauson, and Goddard L.JJ. declined to followan earlier decision of a court consisting of Slesser and Romer L.JJ.This was clearly a case where the earlier decision was given perincuriam. It depended upon the true meaning (which in the laterdecision was regarded as clear beyond argument) of a rule of theSupreme Court to which the court was apparently not referred andwhich it obviously bad not in mind. The Rules of the Supreme Courthave statutory force and the court is bound to give effect to them, asto a statute. Where the court has construed a statute or a rule havingthe force of a statute, its decision stands on the same footing as anyother decision on a question of law. But where the court is satisGedthat an earlier decision was given in ignorance of the terms of a statuteor a rule having the force of a statute the position is very different.It cannot, in our opinion, be right to say that in such a case the courtis entitled to disregard the statutory provision and is bound to followa decision of its own given when that provision was not present to itsmind. Cases of this description are examples of decisions given perincuriam. We do not think that it would be right to say that theremay not be other cases of decisions given per incuriam in which thiscourt might properly consider itself entitled not to follow an earlierdecision of its own. Such cases would obviously be of the rarestoccurrence and must be dealt with in accordance with their specialfacts. Two classes of decisions per incuriam fall outside the scope ofour inquiry, namely (i) those where the court has acted in ignoranceof a previous decision of its own or of a court of co-ordinate jurisdictionwhich covers the case before it—in such a case a subsequent court mustderide which of the two decisions it ought to follow ; and (ii)- thosewhere it has acted in ignorance of a decision of the House of Lordswhich covers the point—in such a case a subsequent court is bound bythe decision of the House of Lords." **
“ On a careful examination of the whole matter we have come to theclear conclusion that this court is bound to follow previous decisions
2**J. X. It 14700 (12/GO)
334
BASITAYAKE, C.J.—JBandahamy v. Senanayake
of its own as well as those of courts of co-ordinate jurisdiction. Theonly exceptions to this rule (two of them apparent only) are thosealready mentioned which for convenience we here summarise :
The court is entitled and bound to decide which of two conflicting
decisions of its own it will follow ;
The court is bound to refuse to follow a decision of its own which,
though not expressly overruled, cannot in its opinion standwith a decision of the House of Lords ;
The court is not bound to follow a decision of its own if it is
satisfied that the decision was given per incuriam. ”
The scope of “per incuriam ” was extended by Lord Goddard,one of the Judges who took part in the Young case, in NuddersjieldPolice Authority v. Watson.1 He said :
“ I know that in the writings of various eminent people the doctrineof stare.decisis has been canvassed from time to time. In my opinion,if one thing is certain it is that stare decisis is part of the law of England,and in a system of law such as ours where the common law, and equitylargely, is based on decided cases, it would be very unfortunatewhen a court of final appeal has given a decision and laid down adefinite principle and it cannot be said the court has been misled inany way by not being referred to authorities, statutory or judicial,which bear on the questions, it should then be said that that casewas not to be a binding authority.”
Lord Goddard further enlarged the scope of per incuriam in Edwardsv. Jonesa by saying —
“ I should have no hesitation, if ■ necessary, in differing from thedecision in that case, not merely because we are sitting now as a courtof three, and that was a court of two, but also because the case wasnot argued for the defendants, who did not appear, and when a casehas been argued only on one side, it has not the authority of a casewhich has been fully argued.”
In Penny v. Nicholas3 Lord Goddard further -widened the scope of“ Per incuriam ”. He said at p. 91 :—
“ Counsel for the appellant said, however, that, at any rate so longas it stands, it is a decision which this court cannot overrule. Wecan, however, always differ from a case on the ground that it has notbeen argued on both sides.”
1 (1947) 2 All E. R. 193 at 196.* (1947) 1 All E. R. 830, 833 (Div. Ct.)
» (1950) 2 AU E. R.-89.
BASIiAYABZE, C.J.—JBandahamy v. Seruinayakc
336
The English practice as to stare decisis is not uniform. The PrivyCouncil does not regard itself as' bound by its own. decisions althoughas a rule it does not refuse to follow them and it is rarely that it reversesits own decisions. The reason for this is not clear. Is it because it isan advisory body and not an appellate court properly so called 1 Is itbecause it is the ultimate tribunal for some countries 1 But in thecase of Attorney-General for Ontario v. Canada Temperance Federation1it stated the principles which guide it in its approach to decided casesand any appeal to reverse them :—
“ Their Lordships do not doubt that in tendering humble advice toTTis Majesty they are not absolutely bound by previous decisions ofthe Board, as is the House of Lords by its own judgments. In eccle-siastical appeals, for instance, on more than one occasion, the Boardhas tendered advice contrary to that given in a previous case, whichfurther historical research has shown to have been wrong. But onconstitutional questions it must be seldom indeed that the Boardwould depart from a previous decision which it may be assumed willhave been acted on both by governments and subjects. In the presentcase the decision now sought to be overruled has stood for over sixtyyears ; the Act has been put into operation for varying periods inmany places in the Dominion ; under its provisions businesses musthave been closed, fines and imprisonments for breaches of the Acthave been imposed and suffered. Time and again the occasion hasarisen when the Board could have overruled the decision had it thoughtit wrong. Accordingly, in the opinion of their Lordships, the decisionmust be regarded as firmly embedded in the constitutional law ofCanada, and it is impossible now to depart from it.”
The following cases are some of those in which it has departed from itsown previous decisions :—In re Payment of Compensation to Civil Servantsunder Article JO of Agreement for a Treaty between Great Britain andIreland2; Fatuma Binti Mohamed Bin Salim Bakhshuwen v. MohamedBin Salim BaJcshuwen3 ; Bereng Griffith Lerotholi and Others v. TheKing4 ; and Gideon Nkambule and Others v. The King 5.
Another court that does not regard itself as bound by the principleof stare decisis is the Court of Criminal Appeal. In II. v. Taylor6 theLord Chief Justice Goddard said :—
“ I should just like to say one word about the reconsideration of acase by this Cpurt. A Court of Appeal usually considers itself boundby its own decisions or by decisions of a Court of co-ordinate jurisdic-tion. For instance, the Court of Appeal in civil matters considers itselfbound by its own decisions or by the decisions of the Exchequer Cham-ber, and, as is well known, the House of Lords also always considersitself bound by its own decisions. In civil matters, it is essential,in order to preserve the rule of stare decisis, that that should be so ;
1 (1946) A. O. 193 at 206.* (1950) A. G. 11.
* (1929) A. G. 242 at 247.s (1950) A. G. 379.
8 (1952) A. C. 1 at 12.-8 34 Gr. App. Reports p. 138.
33B
BASNAYAKE, C.J.—Sandahamy v. Senanhyake
but this Court has to deal with the liberty of the subject, and if thiscourt found on reconsideration that, in the opinion of a full Courtassembled for that purpose, the law had been either misapplied or■misunderstood and that a3 a result a man had been deprived of hisliberty, it would be its bounden duty to reconsider the earlier casewith a view to determining whether he had been properly convicted.The exceptions which apply in civil cases ought net to be appliedin this case, and in this case the full court of seven judges is unani-mously of opinion that the. case of Treanor (supra) was wronglydecided, for a reason which I will indicate in a moment.”
So does the Pensions Tribunal (James v. Minister of Pensions1 andMinister of Pensions v. Higham2), but it being a statutory tribunal with-out the trappings of a Court the policy is understandable.
In Scotland the attitude of the Judges towards stare dec*-sis is not thesame as in England. The Court of Session which is the highest Courtin the country is a single Court and not a hierarchy of separate Courtslike the Supreme Court of England. The eight senior Judges of theCourt normally sit in the Inner House in two Divisions of not less thanthree (three Judges being a quorum in each) while the remaining Judgessit as permanent Lords Ordinary in the Outer House. The Lords Ordi-nary may, without themselves pronouncing a decision, report cases ofdifficulty to one of the Divisions. Whenever an authoritative decisionis called, for, a Court of seven or more or even the whole Court is assembled.The full Court is regarded as having power to overrule the decision of aDivision. See case of M'Elroy v. M’Allister3 where a Court of sevenJudges was assembled to consider whether Naftalin v. Londo-n, Midlandand Scottish R i-ilway Company4 was rightly decided by a Division of theCourt. A tradition has been established by which the decision of oneLord Ordinary is not binding .on another. But the question whether thedecision of a Division of the Inner House is binding upon a Division isnot yet settled as is indicated by the following passage from Gardner’streatise on Judicial Precedent in Scots Law (p. 53)—
“ The principle of a court being absolutely bound by its own previousdecisions has not yet been definitely and completely accepted in Scot-land, and there seems reason, therefore, to doubt if each Division of theCourt of Session is absolutely bound by its own previous decisions,as stated by Lord Wark.”
But the weight of judicial and legal opinion seems to favour the viewthat the decisions of one Division will normally be treated as bindingon both, but in exceptional circumstances, as when an authority isconsidered obviously unsound or unjust, a Division will refuse to followa precedent.
* (1949) Sr.ots Lrfitv Times, p. 139.
4 (1933) S. C. 2.59.
(1947) 2 All E. JR. 432.
(194S) 1 All E. JR. S63.
BArNAY-.-JKK, C.J.—J3nndnhnm>j v. Senanayake
337
The following expressions of judicial opinion cited in Smith’s JudicialPrecedent in Scots Law show the attitude of Scottish Judges :—
" (this case) is on all fours with the case of M'Keman recently decidedin the other Division. If we entertained any doubts of the soundnessof that decision we should certainly not be bound to follow it, as it isonly a single decision on a very important question.” (Lord PresidentInglis in Shanks v. United Operative Masons (1S74) 1 R. S23 at S25.)
“ I should like to say that I do not approve of any judgment ofany Division as conclusive on Scots law. If it should happen to bethought wrong on further consideration either by the same Divisionor by another Division, I am not of opinion that it is necessary tosummon the whole court, or that nothing but an Act of Parliamentwill correct an error which has been fallen into …. and it is amatter of discretion in the circumstances whether in considering apoint which has been the subject of decision either by ourselves orby the other Division, we should call in a large number of judges toconsider it or not.” (Lord Young in Earl of JVemyss v. Earl of Zetland(1S9D) 18 R. 126 at 130.)
** It cannot be affirmed of any court that its decisions are infallible ;nor is it the practice of the Court of Session or the Justiciary Courtto follow blindly all the decisions which have been pronounced inthese Courts. It is true that, so far as these courts are concerned, adecision of importance is not usually reconsidered, except by a fullerbench than that which originally pronounced it, although eases mightbe cited where one Division of the Cmrt of Session has refused to follow'the decision of the other, and that without consultation with theother Division, or has deliberately- reversed a decision which it hasreijxrdod as erroneous without recourse to a larger tribunal.” (LordSalvesen in Glasgoio Parish Council v. Assessor for Glasgow, (1912)
S.C. S18 at 840.)
“ In these circumstances it appears to me that Menzies v. Murrayis no longer a binding authority and that vre are under no obligationto follow' it. We owe respect to previous decisions of superior orequal authority, but we also owe respect to Acts of Parliament ; and ifsubsequent statutes have deprived a decision of its whole content, w'ehave no duty to echo outmoded and superseded conceptions.” (LordPresident in Beith Trustees v. Beith (1950) Scots Law' Times 70.) I
I now come to consider the doctrine as applied in our country. Promw’hat has been said above it would appear that the practice is not thesame even in the Commonwealth countries. England represents therigid school of stare decisis and South Africa the flexible school. Theother countries referred to above appear to be mere inclined tow'ardsthe flexible school than the rigid. Wc in Ceylon are under the influenceof the English legal system by reason of the fact that almost all our
338
BASIN' AY AKLE, C. J.—Bandahamy v. Senanayake
Judges in the pre-independence era were those trained and versed inthe English system. In the result the flexibility of the Roman-Dutchsystem did not have an opportunity of asserting itself.
None of the legislative instruments constituting the Supreme Courtfrom the earliest—-the Charter of 1801—down to the latest—the CourtsOrdinance of 1889—made any reference to the binding effect of itsdecisions as precedents. We have therefore to look to the cursris curiaeto ascertain how the Court regarded the doctrine of stare decisis. Whilethe Supreme Court as constituted by the Charter of 1833 was in existence,oivil appeals were heard in Colombo by all the Judges of the Court and oncircuit by single Judges who had power to refer questions of doubt ordifficulty to the collective Court.
The next instrument constituting the Court to which reference needbe made is the Administration of Justice Ordinance No. 11 of 1868. Inthat Ordinance for the first time a quorum was prescribed for the Courtwhen exercising its appellate Jurisdiction in Colombo. Section 27provided :
“ The Supreme Court shall, at Colombo, hear and determine allappeals from final judgments in civil cases from the several districtcourts in this Colony : Provided that any two of the Judges thereofshall form a quorum, and shall be competent to execute all and everythe powers, jurisdictions, and authorities vested in the said court,except in hearings on review, preliminary to an appeal to the PrivyCouncil, as hereafter directed ; and, in the event of any difference ofopinion between such two Judges, the decision of the said Court shall,in any such case, be suspended until all the three Judges shall be present;and the decision of such two Judges when unanimous, or of the majorityof such three Judges in case of any difference of opinion, shall in allcases be deemed and taken to be the judgment of the Supreme Court. ”
It also provided as follows in section 28 :—
“ Appeals from judgments in criminal cases and from interlocutoryand testamentary and matrimonial and insolvency orders in civilcases pronounced and made by district courts, and all appeals fromcourts of requests and police courts, may be heard, and all powersgiven to the Supreme Court in respect of such appeals may be exercisedby any one Judge of the Supreme Court sitting at Colombo : Provided,however, that nothing herein contained shall preclude such Judgefrom reserving any such appeal for the decision of two or more of theJudges of the Supreme Court.”
This Ordinance was followed by Ordinance No. 1 of 1S89 which,subject to amendments made since then, is the Courts Ordinance nowon our statute book. Section 41 of the original Ordinance and section38 in the. Revised Edition of 1938, provide for the hearing of civil appealsfrom District Courts by two Judges and in the event of a difference of
33 AS 1ST AY AJ5LI5, C. J.—JBandahamy v. SenanayaTee
339
opinion among them by three Judges. District Court Criminal Appealswere originally heard by one Judge but in 1938 provision was made for thehearing of such appeals by two Judges. There was no change in theprovision that one Judge may hear appeals from Courts of Requests andMagistrates’ Courts. A Judge sitting alone had power from the time ofthe Charter of 1833 to reserve any appeal for the decision of more thanone Judge of the Supreme Court. Provision was also made in sections41 and 52, now sections 3S and 48 respectively of the Revised Edition,empowering a single Judge to reserve for the decision of more than oneJudge any question of doubt or difficulty arising in any case comingbefore a single Judge.
In 1901 a special provision was introduced by section 13 of Ordinance24 of 1901 and was numbered as section 54A, now section 51. It read :
“ It shall be lawful for the Chief Justice to make order in writingin respect of any case brought before the Supreme Court by way ofappeal, review, or revision that it shall be heard by and before all the fourJudges of such court, and the decision of such Judges when unanimous,or of the majority of them in case of any difference of opinion, orof the Chief Justice and any one other Judge in the event of theiropinions being opposed to that of the other two Judges, shall in allcases be deemed and taken to be the judgment of the SupremeCourt.”
This section was introduced at a time when the number of Judgesconstituting the Supreme Court had increased to four—the Chief Justiceand three Puisne Judges. It was a Chief Justice and two Puisne Judgestill 1901. In 1921 when the number of Puisne Judges was increased tofour the section underwent further change (s. 4, 36 of 1921). In itsnew form it read :
“ It shall be lawful for the Chief Justice to make order in writingin respect of any case brought before the Supreme Court by way ofappeal, review or revision that it shall be heard by and before all fiveJudges of such Court, and the decision of such Judges when unanimous,or of the majority of them in case of any difference of opinion, shallin all cases be deemed and taken to be the judgment of the SupremeCourt.”
It was further amended in 1926 by Ordinance 21 of 1926 when thenumber of Puisne Judges was further increased and by section 5 of Ordi-nance IS of 1937 a further amendment was made when the number ofPuisne Judges was raised to eight. In its present form it reads : *
*f 51. (1) It shall be lawful for the Chief Justice to make order inwriting in respect of any case brought before the Supreme Court byway of appeal, review or revision, that it shall be heard by and beforeall the Judges of such Court or by and before any five or more of suchJudges named in the order, but so that the Chief Justice shall always
340
BASESTAYAK3, C.J.—Bandahamy v. Szna.na.yake
be one of such five or more Judges. The decision of such Judges whenunanimous, or of the majority of them in case of any difference ofopinion, shall in'all cases be deemed and taken to be the judgment ofthe Supreme Court.
“ (2 Where an order has been made under subsection (1) that anycase shall be heard by and before an even number of Judges and wheresuch Judges are equally divided in their opinions, the decision of theChief Justice or the decision of any Judge with whom the Chief Justiceconcurs shall be deemed and taken to be the judgment of the SupremeCourt.”
Now the .words “ shall in all cases be deemed and taken to be thejudgment of the Supreme Court ” in sections 3S and 51(1), and thewords “ shall be deemed and taken to be the judgment of the SupremeCourt ” in section 51(2) do not deal with the binding effect of the judg-ment as a precedent ; but with its effect as between the parties. Asbetween them the judgment is to be deemed and taken to be the judgmentof the Supreme Court. But as.precedents the statute does not give anyadditional authority to judgments of more than the minimum numberprescribed for hearing any class of appeal. A judgment of two Judgesor a judgment of all the Judges is to be “ deemed and taken to be thejudgment of the Supreme Court”.
So much for the statute law. I shall now turn to the decisions of thisCour. referring to them as far as possible in their chronological order.
In the case of Emanis v. Sedappu1 decided in 1896 Bonser C.J. posedthe following question :—
“Is a solemn and unanimous decision of the Collective Court on aquestion of law delivered in 1862—a decision which followed previousdecisions of this Court—to be treated as a binding authority or not ?”
and answered it thus :
** It ;s obvious that if this question is to be answered in the negative,it will be impossible in the future to regard any question of law asfinally settled. The result will be that the law, which is proverbiallyuncertain, will be rendered more uncertain still, and the passion forlitigation, which is one of the curses of this Island, will be fostered.Ca os will be instituted and appeals taken on the chance that theCourt will be induced to refuse to follow its former decisions.”
Continuing he said :
“ I have not discussed the question as to what our decision would beif the matter were res integ a, for such a discussion would, in the viewI take of the effect of those decisions of this Court to which I havereferred, be a fruitless and barren one. If it were necessary to express
1 {1896) 2 N. L. R. 26l '.
BASNAYAKLE, C..J.—J2a.TUlnhn.my v. Senanayake
341
an opinion on this point, I should be content to adopt the view of mybrother Withers, whose knowledge of Roman-Dutch Daw is so muchgreater than mine. But in my opinion this question is not open ;even if the Court as at present constituted was unanimously of opinionthat the original decision was wrong, it would, I conceive, be out ofour power to alter the law as laid down by our predecessors. Thatcan only be done by the Privy Council reversing those decisions, or by anenactment of the Legislative Council.”
Earlier he gave expression to the view that a judgment which is basedon a mistake does not serve as a precedent and refused to accept thedecision in Unambuwe v. Janohamy'L on that ground. In doing so hesaid :
“ The greatest Judges are liable to err, and Lord Campbell, who,when at the Bar, reported in the Court of King’s Bench, which atthat time was presided over by Lord Ellenborough, one of the mosteminent of the Judges who have occupied the position of Lord ChiefJustice of England, used to say that he had a drawer full of LordEllenborough’s bad law. It is no disrespect to the two judges whodecided the appeal in Unambuwe v. Janohamy to say that a judiciousreporter would have kept this decision of theirs in his drawer.”
The next case which deals with this topic is Perera v. Perera2 decidedin 1033. In that case a bench of three Judges called upon to decidewhether the case of Ayanlcer Nager v. Sinnathy3 decided in I860 by theCollective Court of three Judges (Creasy C.J., Sterling and Morgan JJ.)which had not been followed in a number of subsequent cases (Casie Chettyv. Perera4 ; Abubaker v. Perera5 ; Sella Naide v. Christie6 ; Silva v. Siman7and Unbare v. Mar tells A'p'pu^') was the precedent to be followed. Wendt J.after reviewing the decisions said :
“This redew of the decisions rendered, and opinions expressed, byJudges of this Court shows, I think, that the authority of the decisionof the Full Bench in Aycirtkcr Nager v. Sinnatty, even if doubted ordissented from by individual Judges in comparatively recent years,has never been shaken, much less over-ruled. In my opinion, weought to follow that decision and leave it to the Legislature to alter thelaw so declared, if it sees lit to adopt now a course which it did nottake in 1S71 when dealing with the subject. Assuming the originalinterpretation was wrong—I am far from thinking so myself—* toreverse it suddenly ’ (to quote the words of Sir Edward Creasy, VenderSt ran ten p. 276) ‘ would be to shake the titles to many properties andto cause great and general inconvenience’.”
1 {1S92) 2 C. L. Hep. 103.1 {1903) 7 N. L. H. 173.a Hum. {1370) 73.
*{1SSG) S S. G. G. 31.
8 {1890) 9 S. G. G. 48.
« (1S91) 2 G. L. Hep. 43.
{1898) 4 IV. L. B. 144—1 Tomb. 24.
{1001) 5 N. L. Jt. 210.
342
BASNAYAKE, C.J.—Bandahamy v. Senanayake
The binding effect of precedent next came up for consideration in1907 in the case of Habot v. De Silva1. That was a case heard in reviewby a bench of three Judges preparatory to an appeal to the Privy Councilunder the procedure then in force. Wendt J. said :—
“ The appellants have argued that we are not bound by these twodecisions (Sopi Nona v. Maraiyan (1903) 6N. L.R. 379 ; Karonchihamyv. Angohamy (1904) 8 N. L. R. 1, both decisions of three Judges) andthat they were wrong in law. This contention raises a most impor-tant question as to the effect of such decisions of what has been calledthe * Full Court *, that is, of a bench of three Judges. Until the passingof the Ordinance No. 24 of 1901, which came into operation on 18thDecember, 1901, the Supreme Court consisted of three Judges, but sincethen of four. The practice upon the point we are considering hasvaried from time to time, and while some Judges have considered them-selves bound by judgments of the ‘ Collective Court ’ or ‘ Full Court *others have not hesitated to disregard them when opposed to theirown opinions, without however saying in so many words that theywere not binding. The result is seen in the conflicting decisions thatare to be found in the reports, and which, emanating from the highesttribunal in the land, have produced a most unsatisfactory state ofuncertainty as to the law on several points of importance. It is there-fore much to be desired that the law regarding the effect of Full Courtdecisions should be made clear, or that at least this Court should laydown some rule for itself in dealing with such decisions. I am notnow speaking of those old decisions which, though not rendered bythree Judges, have long been acted upon as declaring the law, andwhich therefore even a Full Court would refuse to disturb, thoughit had the power to do so.”
After referring to a number of previous decisions bearing on the questionof stare decisis, Wendt J. summed up his-conclusions thus :—
** Having given the matter my most careful consideration, I thinkthat as three Judges sitting together are invested with the highestfunction of the Court, viz., the hearing in review, we should not regardthe Full Bench of four Judges as possessing the power to overrule thedecision of three Judges in any matter. I suggest that this Court,whether hearing an orginal appeal or sitting in review, should consideritself bound by a decision upon a question of law of a three JudgeBench, whether pronounced before or after the Ordinance of 1901became operative, and whether upon an original appeal or in review,provided it appears that the law and the existing decisions of the Courthave been duly considered before the thiee Judges arrived at suchdecision. If, however, it were made clear that the decision in questionwas founded on manifest mistake or oversight, I should recognise thatas an exception to the rule.”
» (1907) 10 N. Ij. jS. 140.
33ASN"A"Y"AJ8ZJ5, C. J.—Jia.ndciha.my v. Senanayake
343
Middleton. J. while agreeing in the main with Wendt J. was not preparedto go as far as he did. He said :—
“ There remains the question of the force and effect to be given tojudgments of what has hitherto been known as the Full or CollectiveCourt. It derived the latter name from the fact that it actuallycomprised all the Judges of the Supreme Court collected as one Court,but since 1901 the Court has consisted of four Judges. The consensusof Judicial opinion as collected by my brother Wendt shows thatdecisions of a Court of three Judges have hitherto been looked on asconclusive, and not to be disturbed but by a ruling of the Privy Council.The highest function exercised by the Court in civil matters is, as mybrother puts it, the hearing in review. This function may be exer-cised by three Judges only, but on order by the Chief Justice, undersection 54A of the Courts Ordinance enacted by section 13 of OrdinanceNo. 24 of 1901, by all four. My view is that we should, as hitherto,look upon a judgment of three Judges of this Court on a point of lawas binding on a subsequent Court of three Judges, whether sitting inreview or otherwise, to the extent suggested by the terms of my brotherWendt’s judgment. Whether a Court of four Judges should be deemedto have power to override the decision of three is a matter that I wouldleave to be decided by that Court if necessary when it is first calledinto operation.”
The next case that calls for notice is Jane Nona v. Leo1, a judgment ofa bench of five Judges constituted by the Chief Justice under section54A of the Courts Ordinance. After setting out the history of the legis-lation, Bertram C.J., said :—
“ In spite of this enactment (section 54A), there was a series of casesreserved, not for four Judges, but for only three Judges out of thefour. The decisions in these cases were treated as ‘ Full Bench ’ cases.This practice has prevailed down to the present day, and even sinceour numbers have been increased to five, a Court of three Judgeshas been referred to in our official law reports as constituting a FullBench.”
Thereafter he posed a number of important questions on the bindingeffect of precedent but did not answer them. After discussing theviews expressed in Robot v. De Silva (supra), he said :
“ Opinions have been expressed in the most unqualified terms tothe effect that a judgment of a bench of three Judges is not open tore-consideration. Nevertheless, it is necessary that we should considerthis question afresh, now that our numbers have been increased to five.If a judgment of a Court of three Judges is to bind a Court of fourJudges, what is to happen when the judgment embodies the viewsof a majority only ? Is the opinion of two Judges to bind the four,even though the other two are of a contrary opinion, and even thoughone of these two may be the Chief Justice, whose opinion is given apreponderant effect by the Courts Ordinance *? What is to happen
1 (1923) 25 N. L. R. 241.
344
~BAS1STAYAJCE, C-J.—Bandqhpmy v. Senanayakc
now that our membership consists of five ? Is a judgment of threeJudges binding on the five ? Again, what is to be the case if thejudgment is a majority judgraeut 1 Supposing our numbers areincreased to six, is a judgment of a Court of three to bind the whole 1
" The gravest inconvenience would, no doubt, arise if all the ques-tions determined during the. last twenty years by Courts of threeJudges and considered to be authoritatively and finally settled wereliable to be re-opened, and, no doubt, in determining a question ofthis kind great weight must be attributed to a long continued cursuscuriae, but with due regard to that consideration, the question must bedetermined on principle, and the logical principle seems to be that ajudgment of this Court is not to be treated as a collective judgment,unless, in fact, all the Judges are present. Special statutory force isgiven to the judgment of a Court so constituted by section 5iA of theCourts Ordinance, and such a judgment alone, in my opinion, musthenceforth be considered the collective judgment. It would seem tofollow that any judgment delivered at any previous time, not re-presenting the full membership of the Court, should be sul jeet to con-sideration by the collective Ceurt. I would still hold that it wouldnot be competent for a bench of three Judges to overrule the opinionof a previous bench of three Judges just as, in my opinion, it is not com-petent for a bench of two Judges to overrule a judgment of two Judges(though I am aware that my brother Ennis dissents from this opinion).Any inconvenience which might be supposed to result from the rulethus formulated would be greatly mitigated by the fact that a benchof five Judges can only be constituted by a special order of the ChiefJustice, and it would only be in most exceptional circumstances thatthe Chief Justice would make such an order where the question at issuehas already been considered and determined by a Court of three Judges.”
• It would appear from the decisions both here and abroad cited abovethat the doctrine of stare decisis is not a rigid doctrine and that the prac-tice varies from country to country and that the attitude of Judges tothe doctrine is not uniform and varies according to the class of casewhich comes up for consideration. For instance its application is moreflexible in criminal than in civil cases. It is recognised on all hands thatespecially in regard to property rights and in commercial matters wherefrequent changes in the law would be unsettling it is better that a decisionshould be wrong than that it should upset what has been settled andon the basis of which people have transacted business and dealt withproperty. We have in this country over the years developed a cursuscuriae of our own which may be summarised thus—
:v(o) One Judge sitting alone as a rule follows a decision of anothersitting alone. Where a Judge sitting alone finds himself unable to followthe decision of another sitting alone the practice is to reserve the matterfor the decision of more than one Judge (ss. 38 & 48).
BASNAYAKE. C.J-—J3a.ndahnrny v. Serunxn.yn.kr.^15
(6) A Judge sitting alone regards himself as bound by the decision oftwo or more Judges.
(c) Two Judges sitting together also as a rule follow the decisionsof two Judges. Where two Judges sitting together find themselvesunable to follow a decision of two Judges, the practice in such cases is alsoto reserve the case for the decision of a fuller bench, although the CourtsOrdinance does not make express provision in that behalf as in case of asingle Judge.
(<f) Two Judges sitting together regard themselves as bound by adecision of three or more Judges.
Three Judges as a rule follow a unanimous decision of three Judges,but if three Judges sitting together find themselves unable to follow aunanimous decision of three Judges a fuller bench would be constitutedfor the purpose of deciding the question involved.
(/) Four Judges when unanimous are regarded as binding on all benchesconsisting of less than four. In other words a bench numericallyinferior regards itself as bound by the unanimous decision of a benchnumerically superior.
(g) The unanimous decision of a Collective Court, i.e., a bench con-sisting of all the Judges for the time being constituting the Court, isregarded as binding on a bench not consisting cf all the Judges for thetime being constituting the Court even though that bench be numericallysuperior to the Collective Court owing- to the increase in the numberof Judges for the time being constituting the Court.
(A) The unanimous decision of one C Elective Court is regarded as -binding on a subsequent Collective Court though the latter is numericallysuperior owing to the increase in the number of Judges for the time beingconstituting the Court.
(0 That however representative a bench may be, its decision is notregarded as binding if there has been a mistake in the decision, or relevantdecisions or statutes have not been considered.
(j) That the Court is slow to depart from a decision of long standingaffecting property rights or commercial transactions even where it doesnot agree with it.
(A) That in criminal matters, where the interests of justice or theliberty of the subject requires it, previous decisions are not adhered towith the same rigidity as in civil eases, where it is in the interests ofjustice or the liberty of the subject that a different view which commendsitself to the Court should he taken.
The question whether a decision of a Collective'Court when it is notunanimous is as binding as the unanimous decision of a Collective Courthas not been expressly decided. But it would appear from the dicia-I have quoted above that it is the unanimous decision of a C ElectiveCourt that is regarded as binding on a Collective Court. Similarly thequestion whether the majority decision of a specially constituted bench.
346
BASNAYAKE, C.J.—Bandahamy v. Senanayake
is binding on a bench consisting of a number equal to the majorityhas not been expressly decided. I shall illustrate my statement byposing the following questions. Is a majority decision of a bench ofthree Judges binding on two 1 Is a majority decision of three out offive Judges binding on three ? Is a majority decision of five out ofseven Judges binding on five ? Is a majority decision of seven out ofnine Judges binding on seven 1
In South Africa the view has been expresssed by some Judges that thedecision of a bench of five though it is not unanimous is as binding as aunanimous decision of five Judges. I find myself unable to share thatview. I see no reason why a bench of five Judges when they are unani-mous should accept as binding a decision of three out of five Judges of aprevious bench or why a collective Court when it is unanimous andnumerically superior should subordinate its judgment to the decisionof the majority of a previous Collective Court. I can appreciate suchan attitude where statutory provision is made that the decision of themajority of a specially constituted bench must be regarded as if it werethe decision of all, but we have no such legislation in Ceylon. I canquite understand a subsequent Collective Court unanimously acceptingthe majority decision of a previous Collective Court as a judgment thatcommends itself to it but I am unable to accept the theory that a CollectiveCourt must slavishly submit to such a majority decision merely becauseit is majority decision of a Collective Court. Similarly why shouldthree Judges be bound by a decision of three out of five Judges merelybecause the bench consisted of five, or five be bound by the decision offive because the bench consisted of seven ? Such a course would amountin my view to the enthronement of the rule of stare decisis as a tyrant.
It seems to me that the weight attached to a judicial opinion where aCourt consists of a number of Judges is the weight of numbers on theprinciple that two heads are better than one. It should be rememberedthat the doctrine of stare decisis is a good servant but a bad master.As the Court is constituted today a unanimous decision of nine of usshould carry greater weight than a unanimous decision of seven or fiveof us. Similarly the decision of five of us when sitting as a bench of nineshould not carry greater weight than the unanimous decision of a benchof nine, seven or even five. In the same way the decision of three out of abench of five should not carry greater weight than the unanimous decisionof a bench of three. Where a bench of three is divided the decision of amajority of two should have no greater weight than the unanimousdecision of two sitting together.
Before I leave this topic I must take this opportunity of referring tothe present rigid rule that the decision of a Collective Court when unani-mous is binding on a Collective Court and that the Jaw as laid down by aCollective Court can only be altered by the Legislature. I think thatsuch an inflexible rule does not foster the development of the law. 'Theultimate tribunal should as in .the case of the Privy Council be free to
BASNAYAKE, C-T.—Sandnhnmy v. Sencmayahe
347
decide a question, before it according to its best judgment without beingfettered by its previous decisions if it finds itself unable to subscribe tothem. A relaxation of the present rule will net necessarily result in ageneral reversal of established decisions. It will be in the rarest of casesthat one Collective Court will find itself compelled to depart from thedecision of a previous Collective Court. But there should be room forthat rare case to occur. The fact that the Privy Council does not regarditself as bound by its previous decisions has not brought about anyundesirable consequences. An ultimate tribunal can be relied on toexercise such a power with the same reserve and c are as the Privy Council.
Learned counsel for the respondent contended that section 51 of theCourts Ordinance is designed to give to decisions of a bench constitutedunder that section, even where it is numerically less than the number forthe time being constituting the Court, the binding force of a judgmentof the Collective Court. He supported his contention by reference to thehistory of the legislation. The provision was first made in 1901 bysection 13 of Ordinance No. 24 of 1901 and it read :
“ It shall be lawful for the Chief Justice to make order in writingin respect of any case brought before the Supreme Court by way ofappeal, review, or revision that it shall be heard by and before all thefour Judges of such court, and the decision of such Judges whenunanimous, or of the Chief Justice and any one other Judge in the eventof their opinions being opposed to that of the other two Judges, shallin all cases be deemed and taken to be the judgment of the SupremeCourt. ”
The language used in regard to the binding force of a judgment of a benchconstituted under the section above quoted is not different from thatused in regard to a bench of two Judges in section 3S—
“…. and the decision of such two Jxidges when unanimous,
or of the majority of such three Judges in case of any difference ofopinion, shall in all cases be deemed and taken to be the judgment ofthe Supreme Court. ”
That section was later amended in 1921 by section 4 of Ordinance No. 36of 1921 by the substitution of “ five ” for “ four ” when the number ofJudges of this Court had increased to five. Still later in 1937 the thenexisting provision was replaced by the present provision by section 5 ofOrdinance No. 18 of 1937. The object was to provide for the increasein the numerical strength of the bench in that year to nine.
I am unable to agree with learned counsel that section 51 enacts a ruleof stare decisis and is designed to give to a decision of a bench constitutedthereunder the same binding effect ?s the judgment of the CollectiveCourt. Learned counsel sought to reinforce his submission by referenceto the objects and reasons of the Ordinance and to the Hansard of 27thNovember 1901. Even if it is permissible to resort to those documents
2(48;BAjSiNTAYAKE, C.J.—Bandahamy v. Senanayake
for the purpose of interpreting the section, and I think it is not, I amunable to find in them support for learned counsel's submission. Therelevant portion "of the speech of the Attorney-General in the Hansard of27th November 1901 (p. 31) reads :
ft #•
“ Ap important amendment is to be found in clause 5. Section 8 of, the principal Ordinance declares that the Supieme Court shall continueto be the only Superior Court of Record and consist of three Judges.The amending clause says that ‘ it shall consist of four Judges’. Thatis the principal amendment which is made in the Courts Ordinanceof 1899. The other amendments, which I need not go through one byone, simply provide for three judges in lieu of four judges, because,if the Ordinance stood ‘in full court’, it would require that fourjudges should hear certain cases. That is not at all desirable becausetwo of the Judges might be inclined to give Judgment one way and twothe other way, whereas if these cases are heard by three Judges, it isperfectly clear that there must be a majority. The Ordinance onlyturns on the question of the appointment of a fourth Judge. ”
The “ Objects and Reasons ” to the 1921 amendment states :
“ The amount of work in the Supreme Court has increased so greatlythat it has become unavoidable to increase the number of the Judgesfrom four to five. As section 8 of the ‘ The Courts Oidinance, 188Q ’provides only for four Judges, the amendment proposed to be madeby section 2 of this Bill is necessary before a fifth Judge can beappointed. Section 4 cf the Bill makes a necessary alteration in section54A of the principal Ordinance in consequence of the increase in thenumber of the Judges. ”
In introducing the amendment the Attorney-General said :
“ Then, Sir, as regards the amendment provided for in section 54,that is made necessary by the appointment of a fifth Judge. Section54A provides for the Chief Justice making an order in respect of anycase brought before the Supreme Court by way of appeal, review, orrevision that it shall be held by or before all the four Judges of such‘ Court, and then it goes on to provide what is to happen in the eventof the Judges being divided two and two. This again gives effectto the new proposal to have five Judges, and provides for a decisionby a majority of the five Judges. ”
It seems to me that that section was frem the very outset designed toempower the Chief Justice to order that a case shall be heard by all theJudges of the Courts only when in his opinion it was necessary, as theCourts Ordinance, which replaced the Administration of Justice Ordi-nance, departed from the provisions of the latter Ordinance, which pro-vided that appeals in civil cases shah be heard by all the Judges consti-tuting the Supreme Court, but that any two of the Judges shall form a
BASNAY-VKE, C.J.—Bcmda-hamy v. Scnnnayake
349
quorum ^s. 27 Ordinance No. 11 of 18GS), and made provision for thehearing of civil appeals by two Judges of the Supreme Ccurt. It appearsto have been thought that whore in any particular case it became necessarythat the full Court should assemble to hear an appeal the existing provi-sions did not empower the Cliief Justice to summon such a Court and evenif such a Court assembled there was no provision which said that thedecision of such a Court “ shall in all ca-ses be deemed and taken to bethe Judgment of-the Supreme Ccnrt as in the case of civil appeals heardbefore two Judges. ” The section was introduced to supply thatomission.
Learned counsel for the respondent, to whose industry we are greatlyindebted, furnished us with a list of decisions of this Court by benchesconsisting of more than the minimum number proscribed by the CourtsOrdinance for hearing of civil and criminal appeals. He claimed thatthose decisions show that the decision of a bench constituted undersection 51 was regarded as binding as the decisions of the CollectiveCourt. The list is given in the appendix to this judgment.
The very strength of judge-made law lies in its flexibility and capabilityof devoir pment by judicial exposition by generations of Judges. A rigidadherence to stare decisis would rob our system cf its virtues and hamperits development. We should strive to strike a mean between the oneextreme of too frequent changes in the law without sound and com-pelling reasons for them and the other extreme of slavish adherenceto precedent merely because it has been decided before. The virilityof the bench is shown by its capacity to reassess post decisions anddeclare the law as it should be in the light of a more careful analysis ofthe problems involved than has been done before taking into account thedevelopment of legal thought in other countries. If the bench is power-less to depart from a decision that research and analytical skill of counselbacked by sound argument have shown to be wrong the judicial processwtuld bo of little value.
Our legal machinery being so different from that of Hngland it wouldbe wrong I think to regard the case of Young v. Bristol Aeroplcine Co. Ltd.{supra) or the practice of the House of Lords as applicable to us. Themany exceptions created by Lord Goddard who participated in it tothe rule laid down in the Bristol Aeroplane care show the unwisdom oflaying down a hard and fast rule in the matter of stare decisis. All thedecisions of the Supreme Court are not reported and even the reporteddecisions are all not cited and unless the Judges themselves know all thereported and unreported decisions it would be impossible not to contra-vene the rule unwittingly. Lor that reason and the many ether reasonsset out hereinbefore the rule has to bo flexible. I
I am in favour of adopting the South African view that the ultimatetribunal of a country should like the Privy Council be free to reverse itsown decision If it finds that it is wrong. There is no danger in such arule, seeing how rarely ultimate Courts that recognize such a right reverse
350
BASEST AYAKE, C.J.—Bandahamy v. Senanayake
their own decisions. The policy of the Privy Council seems to me to bemore enlightened than that of the House of Lords. Law, like other things,is not static and rigid adherence to previous views even when they areout of place and cannot be reconciled with modern legal concepts doesnot foster development of legal thought. I am in entire agreementwith Professor Goodhart and other jurists in England and other parts ofthe Commonwealth who favour a less rigid approach to the doctrine thanthat adopted by the House of Lords or the Court of Appeal since theBristol Aeroplane case. It is difficult to reconcile the “ perpetual pro-cess of change ” in the common law with a rigid stare decisis.
In regard to the specific question before us I am of opinion that thePinikahana case (supra) does not overrule the decision in J ayasinghe’scase (supra) not only because the observation therein is obiter but alsobecause a majority of three Judges in a bench of five Judges cannotoverrule the unanimous and considered decision of a bench of three Judges.The fact that no reference is made to J ayasinghe's case and no reasonsare given for disagreeing with it is an added circumstance which goes toshow that Jayasinghe's case is unaffected by the Pinikahana case and isstill good law.
I do not propose to deal with the connected topics of ratio decidendiand obiter dicta as they have been adverted to by both counsel only inpassing, and a detailed discussion is not therefore necessary for the purposeof this case. As stated above the Courts Ordinance makes the concretedecision binding between the parties to the litigation. It is the underlyingprinciple which forms its authoritative element and has the force of lawas regards the world at large, that is termed the ratio decidendi. It isalso described as the rule of law propounded by the Judge as the basisof his decision. Much has been written on the subject of ratio decidendiby jurists in the recent years. Professors Goodhart, Montrose, Simpson,and Julius Stone have all made their contributions1. The difference ofviews exhibited in their writings indicates that the subject is not withoutdifficulty. * Obiter dictum * means what the words literally signify—•namely a statement made by the way. If a Judge thinks it desirable,as Judges often do, to give his opinion on some point w'hich is not neces-sary for the decision of the case, that has not the same binding effectas the ratio decidendi. The weight to be attached to an obiter dictumdepends on the eminence of the Judge who pronounces it. Obiter dictaare often adopted as correct statements of the law and in the course oftime acquire the status of authoritative pronouncements. A precedentcannot be applied without ascertaining its ratio decidendi and it istherefore necessary to be clear in one’s own mind as to what is meant bythe expression.
1 Ooodhart—Essays in Jurisprudence and the Gammon Law. 22 Modern Law Review117.
Montrose—20 Modem Law Review 124.
Modem Law Review 587.
Simpson—20 Modern Law Review 413.
Modem Law Review 155.
StoneThe Province and Function of Law.
BASNATAJUj!, C.J.—Bandahamy v. Senanayake
351
For the reasons X have already given X think this appeal should beallowed, with, costs and the order of the District Judge should be setaside.
APPENDIX
Year No. ofPartiesPoints in issueReference
Judges
1923 .. Five .. Jane Nona v. Leo . . EvidenceOrd. 25 N. L. R. 241
Sec. 112—Access
1923 . . Five . . Anohamy v. Haniffa Lis Pendens—Gift by 25 N. L. R. 289
husband to wife—
Liability for * debtsof husband
1923 . . Five . . Kalian Bhai v. Perera Partitionaction—De- 26 N. L. R. 204
cree for sale—Prohibi-tion against aliena-tion—Continues forbow long ? Ord. 10of 1863 Sec. 8
of Powers of S. C. to re- 29 N. L. R. 52view order for issueof warrant of com-mitment by Commis-sioner of Assize
1929 .. Five .. Boyagoda v. Mendis Appeal—timelimit— 30 N. L. R. 321
C. P. C. Sec. 754
Title to property vested 32 N. L. R. 217in Municipal Councilwhich was added asparty. Right of pltff.to maintain action
.. Four .. Mendis v. Jayasuriya Election petition—Ori- 33 N. L. R- 121
ginal Security forcosts—Election (StateCouncil) Ordor-in-Council 1931—Rules12, 13, 19, 21 & 41
1931. . Four .. De Silva v. Go one til-
leke
1926 . . Four . . Appln. for writ
Habeas Corpus
. . Four . . Andiappa Chettiar Whether presence of 33 N. L. R. 217
v. Sanmugam Chet- proctor is appearancetiar—C. P. C. Sec. 24,
146, 823
. . Four . . De Silva v. Nonohamy Right of way of several 34 N. L. R- 113
lands—Obstruction byone owner. Joinder
of other owners
C. P. C. Sec. 18
. . Four . . Sultan v. Pieris . . Validity of Muslim Deed 35 N. L. R. 57
of Gift inter _ vivoswhich was to takeeffect immediately—
Reservation of lifeinterest—Applicabili-ty of Roman Dutch•Law
362
BASNAYAKE, C.J.—Pandahamy v. Senanayake
ear No. ofPartiesPoints in issueReference
.Judges
• •'1934. – Four . . Kailasan Pillai v. Decree assigned in writ- 35 N. L. R.. 342
Palaniappa C hettiar ing—Soiled by crotli-'tor—Quostionof
priority
1936. . Four . . Sangarapillai v. Deva- Husband’s right to 38 N. L.. R. 1
. .. rajah Mudaliyarmortgage tediatetam
property
1925. . Four . . Application of Prootor Conviotion for breach 39 N. L. R. 517
to. be re-admitted of trust—Application
for re-admission
1939. . Five . . Wijeyewardene v. Po- Failure of Fiscal to do- 40 N. L. R. 217
disinghomand payment of
money at sale—Salemay be set aside onappln. of judgment-debtor
1940 . . Five
De Silva v. Seena- Notice of security for 41 N. L. R. 241thummareapdts’costs—two
reapdts.—Notice ser-ved on one andsecuritygiven—
Delay regards other—
Power of S. C. togrant relief—C. P- C.
Sec.'756 (3)
. . Five .. R. v. Sheriff. . Charge of rape—absence 42 N. L>. R. 169
of corroboration ofcomplainant's evi-dence. Failure ofJudge to warn Jury—-■ misdirection. Nature
of corroboration*
. . Five . . Abuthahir v. Mo ham- Muslim deed of gift— 43 N. L. R. 193
med Sallyreservation of life
interest in donor—-whether fidai com-miaanm
1941 . . Five . . Ceylon Investments Assessableincome— 43 N. L. R. 1
Company v. Com- claim to deductmr of Income Tax management expenses
1942• . Seven R. v. Chandrasekera Self defence—plea of 44 N. L. R. 97
general or specialexception under PenalCode—need fails toestablish the plea—
Reasonable doubtcreat'd on whole case.
Aocd not entitl'd tobenefit of doubt
BASNAYAKE, C.J.—Bandahamy v. Senanayake
3G3
Year No. of. Parties
Judges
Five . . Marikar t>. Subrama-* niam Cbettiar
1044. . Five . . De Saram v. Kadjiar
1945 . . Five . . Appuhamy v. Martin
1947 . . Five . . Thassim v. Rodrigo
1950. .Five. .Noorul Hatchikav.
Noor Hameem
. .Five. .R. v. Jin atlas a..
..Five..Perera v. R…
1951. .Five. .Podisingho v. R.. .
1952 « . Five .. Akilandanavaki _ v.
Sothinngarafcnam
1952. . Five , . Jamis v. R.
Points in issueRejeren.ee
Action to re-open money 44 N. L. R. 409*lending transactionand to set aside pro-note. Kigltl to recovercompound interest
Fidei commission—Last 45 N. L. R. 265Will of Muslim
Whether proceedings 46 N. L. R. 481under Claims toForest Chona, WsCsteandUnoccupied
Lands Ord. 1 of 1897are proceedings inrein—final and con-clusive-
Writ of Certiorari—Re- 48 N. L.R. 121gelation 62 of Defence(Control of Textiles)
Regulation Orders—
.Judicial nature ofTextile Controller’sduty—CourtsOrdi-
nance Sec. 42
Transfer of immovable 51 N. L. R. 134property in consi-deration of marri-age—executionby
Rotary. Sec. 2 ofPrevention of FraudsOrd.
Sec. 122 Cr. P. C. . . 51 N. L. R. 529
Grave and Sudden pro- 53 N. L. R. 193vocation—Mode ofresentment—Sec. 294Fxception 1, Soc. 297Cr. P. C.
Cr. P. C. Sec. 184/230 53 N. L. R. 49Discretion of Courtto order separatetrials—joint trial ofBovorul persons
Retrospective effect— 53 N. L. R. 385Jaffna MatrimonialRights Inheritance0«rl. Amending Ord.
1947
Test of Gravity—provo- 53 N. L. R. 401cation
354
BASNAYAKE, C. J.—Bandahamy a. Senanayake
Year No. ofPartiesPoints in issueReference
Judge 8
. . Five .. A. G-. do Mel v. R. C. See. 11 and 152 (3) C ■ 55N. L. R. 537
de NeiseP. C. applicability
1954 .. Five . . Muttu Banda v. R.. . Culpable homicide—pro- 56 IT. L. R. 217
vocation. Penal CodeSec. 294 Exception—
Relevancy
. . Five . . Perera v. Munaweera Mens rea—Penal Code 56 IT. L. R. 433
Sec. 38 (2J/72—Ap-plicability to Statu-toryoffences—Mis-
take of fact
.. Five . . Soosaipillai v. Soosai- Thesavalamai Sec. 9/11 57 IT. L. R. 529
pillaiPart I—property of
deed, wife—Husband’srights—Sale by son—rights of vendee
1956. . Five . . Silver Line Bus Com- Cond. L/A to P. C.—Cor- 58 N. L. R. 193
pany v. Kandytiorari—Civil suit or
Omnibus Companyaction—CourtsOr-
dinance Sec. 42
. . Five . . Perera^w, Abeysekera Informal agreement 58 IT. L. R. 505
to sell immovableproperty. Time forexecution of deed ofsale.Forfeiture
clause. Failure topay balance. Rightof refund
1957 .. Five . . University of Ceylon Notice re Cond. L/A 59 IT. L. R. 8
v. Fernandoto P. C. application—
Personal service notnecessary
1957
Five . . Pinikahana Co-op. Procedure of enforce-Society v. Herath ment of award of
arbitrator—Rule 3 8
(13) validity
59 IT. L. R. 1.45
1957. . Five . . 1. Fernando v. Cooray Sale of immovable pro- 59 IT. L. R. 169
2. Siriwardene v. perty. Reservation ofSameliacondition *of re-con –
veyance. Admissibi-lity of parol evidenceof mortgage
1957. . Five . . Mallawa v. Gunase- Kandyan Law—IUegi- 59 IT. L. R. 157
keratimate daughter—
.diga marriage—Right
to inherit father’sacquired property
PULLiE, J.—Bandahamy v. S^nanayalce
356
Ptjlle, J.—
The principal question which arose for determination by a benchof five judges in the Pinikahana1 appeal was whether rule 38 (13) madeunder section 46 of the Co-operative Societies Ordinance (Cap. 107)was ultra vires. Eventually a final decision was given not only on thebasis that the rule was not ultra vires but also on other matters in dispute,of which one was that the Assistant Registrar of Co-operative Societieshad no power to refer the dispute to the arbitrator. In my opinion itcannot be urged that what was said in my judgment over and abovethe legality of rule 38 (13) was obiter. The procedure for enforcing awardslaid down in Jayasinrjie v. Boragoda Co-operative Stores2 was strictlyfollowed in the Pinikahana?- case. The application to enforce the awardwas by way of petition supported by an affidavit on which an order nisiwas ordered on the debtor respondent. In so far as the judgment cf themajority went on to say that an action by summary procedure was notessential to enforce an award, that was not necessary for the purposeof deciding the appeal. However, the general proposition that a courtasked to execute an award ex facie regular as a decree has no jurisdictionto test its validity undoubtedly called in question the necessity for theprocedure in Jayasinghe’s2 case.
I think that the passage in my judgment in the Pinikahana1 case whichstates that if an award is ex facie regular the court in which it is soughtto execute it as a decree has no jurisdiction to test its validity should,in my opinion, be read in the context of the facts of that case. Theaward sought to be enforced is in a Government printed form and reads :—
AWARD
“ Under section 45 of Ordinance No. 16 of 1936 (Cap. 107) as amendedby Act 21 of 1949.
“ Whereas the following matter in dispute between the Pinikahana-Kahaduwa Co-operative Stores Society Ltd, Registered No. G 161,Pinikahana, Kahaduwa, plaintiff, and Poddiwala Marage Herath, Pini-kahana, ICahaduwa, defendant, namely, whether the said defendant owesto the said plaintiff the sum of Rupees five thousand six hundred andeighty-four, and cents forty-one consisting of
Goods not accounted for by him (defendant) during the period10.3.43 to 31.12.47.
Interest on above at 9% from 31.12.47 to 24.7.53, has beenreferred to me for determination by the order of the Assistant Registrarof Co-operative Societies, Southern Province, dated 19th September,1953,
“ I having duly considered the matter, do hereby direct that the saidPoddiwala Marage Herath of Pinikahana, Kahaduwa, do pay the said
1 (1058) 50 N. L. It. 145.
2 (1955) 56 N L. It. 462.
35
PU1LE, J.—Bandahamy v. Senanayake
Pinikahana Co-operative Stores Society Ltd. Reg. No. G 161 the sumof Rupees four thousand three hundred and four and cents forty-one andcosts.
“ The above amount shall be paid by 18th November, 1953 : if it isnot paid the amount may be realized through a civil court.”
The award purports to carry the signature of the arbitrator, and twoother signatures to the effect that it was made in the presence of theparties whose signatures are also attached. It is dated 17th October,1953. There is also a statement at the foot of the award that it wasexplained to the parties present and that they were informed of theirright of appeal. The p inted form provides for setting out the dateof receipt of an appeal, if any, and the Registrar’s order in appeal. Sofar as the document speaks there was no appeal and, in fact, there wasnone.
It is clear that if an invalidating circumstance appears on the face ofthe award or, for example, the award shews that an appeal had beenfiled and it? determination was still pending, a court would be justifiedin not enforcing the award for no cou t should lend itself to an abuse ofits process. There cannot, of course, be a standard test by which a courtwill in every instance judge whether an award is regular on the faceof it. I can conceive of a case in which a court, bearing in mind thelimitation imposed on it by section 45, sub-section 5, may call for infor-mation before ordering the execution of an award but, with all respectto my brethren who take a contrary view, I find it difficult to assent tothe proposition, assuming that rule 38 (13) is intra vires, that a partyseeking . o enforce an award is placed in a position analagous to one whobrings an action on a foreign judgment by a regular action or to one whoseeks by summary pr:cedure under Chapter 53 of the Civil ProcedureCode to enforce a liquid claim. In the latter case it is the decree of theCourt that will eventually be enforced and not an instrument which ismade equivalent to a decree of court. To my mind the words of therule tha the award shall “ be enforced in the same manner as a decree ”are sufficiently clear to indicate the mind of the legislature that itdid not contemplate proceedings in the nature of a regular or summaryaction to enforce an award.
The_e are also practical reasons why, generally speaking, a court offirst instance called upon to enforce an award under rule 3S (13) shouldnot be burdened with the task of deciding whether an arbitrator, on per-haps new facts adduced in court, had jurisdiction to make a particularaward. A party may submit himself to the jurisdiction of an arbitratorwithout disputing any factual matter which the arbitrator might havehad otherwise to decide to clothe himself with jurisdiction. In such acase would it be right to allow the debtor to canvass jurisdiction before
PTJL/L.E, J.-—Bandahamy v. Sennnayake
357
a Court of Requests or a District Court ? A debtor summoned beforean arbitrator has the amplest remedy before an award is made torestrain him from assuming a jurisdiction which he does not possess. Afterthe award he has a right of appeal to the Registrar and he could, as anultimate resort, move to have it quashed by certiorari.
Let me take on extreme illustration. A debtor summoned before anarbitrator to answer a claim raises an issue as to jurisdiction, thedecision of which would depend on a finding of fact. The arbitrator comesto a' finding against the debtor and, therefore, proceeds to hear evidenceon the merits of the claim and makes an award. The debtor appealsto the Registrar only on the quantum of the award and eventually theaward is affirmed. Could it have been contemplated by the legislaturethat when the creditor moves to enforce the award in a District Courtthe debtor has the right to raise de novo the question of jurisdictionwhich he had raised earlier and also any new ground of want of juris-diction ?
There is also to my mind no impediment after execution has beenordered to have it stayed pending other proceedings to have the awardquashed for want of jurisdiction. These are considerations which ledto my view that under rule 18 (13) a court merely places at the disposalof a creditor of a particular type favoured by the legislature its ownmachinery for collecting his dues.
At one stage of the argument I was impressed by the submission ofMi. H. W. Jayewardene that the Ordinances amending the Courts Ordi-nance, 1839. beginning with Ordinance No. 21 of 1926 and ending with theCourts Amendment Ordinance, No. IS of 1937, were intended to give toa decision of the Supreme Court constituted under Section 51 of theCourts Ordinance (Cap. 6) the same binding effect as the decision of aCollective Court. I agree with my Lord, the Chief Justice, that it isnot possible to read into these amendments an intention to render adecision by a Bench constituted under Section 51 as authoritative as adecision of all the Judges. Therefore, the present Bench of seven Judgesis not bound by the decision of the numerically smaller Bench of five Judgesin the Pinikxhana1 case. The numerical superiority of a particularBench must be decided with reference to the number of Judges consti-tuting that Bench and not by the number of Judges who hold a particularview.
On the merits I agree with Weerasooriva and H. N. G. Fernando, JJ.,that the appellant fails in his contention that the award should not beenforced as a decree of Court.
I would dismiss the appeal with costs.
* U957) 50 N. L.. R. 145.
358
WEERASOORIYA, J.—Bandahamy v. Senanayake
WEE&ASOOBnfA, J.
I have seen the judgment prepared by my Lord the Chief Justice.As I am not in agreement with him on at least two of the questions asstated by him, the answers to which materially affect the decision of thisappeal, I wish, with deference, to set out, in the first place, my own viewsin regard to them.
One ground of objection taken by the defendant-appellant to thevalidity of the award in favour of the liquidator (the petitioner-respondent)may be stated as follows : The only provision in the Co-operative SocietiesOrdinance (Cap. 107) enabling the liquidator to refer for compulsory arbi-tration tinder Section 45 of the Ordinance the dispute that had arisenbetween himself and the appellant is Section 40 (1) (d) as amended byAct No. 21 of 1949 ; but that section in its amended form cannot beavailed of by the liquidator as the dispute admittedly arose on the 19thMarch, 1949, whereas Act No. 21 of 1949 came into operation only onthe 24th May, 1949.
In view of the decision in Nawadun Korale Go-operative Stores UnionLtd. v. W. M. Premaratnex, the correctness of which was not canvassedby learned counsel who argued the appeal, this objection would appearto be a good one unless it is possible to hold that the validity of the awardis saved by Section 2 (1) of Act No. 17 of 1952. Section 2 (1) clearly in-dicates that the Legislature also accepted the position that Act No. 21of 1949 did not apply to disputes arising before it had come into opera-tion. The relevant part of Section 2 (1) provides that Section 45 of theCo – operative Societies Ordinance “ shall apply in the case of every dis-pute of any description referred to in that section as amended by ActNo. 21 of 1949 notwithstanding that the dispute may have arisen priorto the date on which that Act came into operation. ”
Section 40 (1) (d) of the Co-operative Societies Ordinance, as amendedby Act No. 21 of 1949, empowers a liquidator appointed under section39 of the Ordinance to “ refer for arbitration under section 45 any disputeof any description mentioned in that section (references therein to thesociety being construed as references to the liquidator)”. The referenceof the dispute in the present case (which, as stated earlier, arose on the19th March, 1949) was made by the liquidator to the Registrar of Co-operative Societies on the 21st May, 1952. On that date there was adispute between the liquidator and the appellant which, had it arisenafter Act No. 21 of 1949 came into operation, would have been a disputeof the description mentioned in section 45 and referable by the liquidatorfor arbitration under that section by virtue of the enabling provisionsof the amended section 40 (1) (d). But in view of section 2 (1) of ActNo. 17 of 1952, the provisions of section 45 now apply to every suchdispute notwithstanding that it had arisen prior to the date on whichAct No. 21 of 1949 came into operation. It seems to me, therefore,
1 (1954) 55 N. L. R. 505.
WEERASOORITYA, J.—JSandahamy %>. Senanayake
359
that at the time when the dispute in the present case was referred by theliquidator to the Registrar of Co-operative Societies it was a disputewhich was referable for arbitration under section 45 of the Ordinance.
But it is contended for the appellant that when a liquidator, actingin terms of the amended section 40 (1) (d), does “refer " a dispute forarbitration under section 45, it is the former section which governs thearbitration of the dispute and not the latter ; and that if this contentionis accepted there is no provision of law (corresponding to section 2 (1) ofAct No. 17 of 1952) which gives retrospective operation to the amendmentof section 40 (1) (d) by Act No. 21 of 1949 so as to validate an arbitrationunder that section of a dispute between the liquidator and a past officer ofthe society which arose 'prior to the date on which the amending Actcame into operation. X understood it to be common ground that theprovisions of section 2 (1) of Act No. 17 of 1952 do not give retrospectiveoperation to section 40 (1) (eZ).
This contention involves a consideration of the meaning of the ex-pression “ refer for arbitration under section 45 ” in the amended section40 (1) (<Z). On the meaning sought to be given to it by Mr. H. V. Perera,the words “ under section 45 ”, which clearly qualify the word “ arbitra-tion”, would appear to be otiose. I am unable to accept his suggestionthat the qualifying phrase “ under section 45 ” is used only for the limitedpurpose of indicating the compulsory nature of the arbitration as dis-tinct from an arbitration with the consent of the parties. In my opinionthe plain meaning of section 40 (1) (d)—in so far as it relates to the re-ference of disputes for arbitration—is that in the settlement of anydispute to which a liquidator is a party (references in section 45 to thesociety being construed as references to the liquidator), the procedure ofcompulsory arbitration provided in section 45, together with all thelegal consequences attaching thereto, is made available to the liquidatorif he should choose to adopt it.
Section 45 provides for a reference in the first instance of a disputeof the description mentioned therein to the Registrar “ for decision ” ;and that a dispute so referred may be decided by the Registrar himselfor referred by him for disposal to an arbitrator or arbitrators. Thesection, it will be noted, is silent as to who should make the referenceof the dispute to the Registrar. But such a matter is regulated by Rule38 (1) of the rules made under section 46 of the Co-operative SocietiesOrdinance according to which a reference may be made by—
(а)the committee of the registered society, or
(б)the registered society by a resolution passed at a general meeting
of that society, or
any party to the dispute, or
any member of the registered society if the dispute concerns a
sum due from a member of the committee or other officer ofthe society.
360
WEE RASOORIYA, J.—Bandahamy v. Sennn.aya.ke
It seems to me that just as Rule 38 (1) enables the persons or bodiesenumerated therein to do the act of making the reference to the Registrar,the amended section 40 (1) (d) enables a liquidator to do likewise, butonly for the limited purpose of arbitration under section 45 by an arbi-trator or arbitrators. In my opinion it is in this sense that the expressionrefer ” in section 40 (1) (d) should be construed. I see nothing in-consistent with such a construction in the provisions of the amendedsection 40 (1) (h) which were, to some extent, relied on by learned counselfor the appellant.
• I would, in this connection, refer to my judgment in Punchinona v.The Gonagala Co-operative Stores Society Ltd-1 The question which arosein that case was whether a reference to arbitration purporting to beunder Rule 29 of the rules made under section 37 (2) of the Co-operativeSocieties Ordinance, No. 34 of 1921, could be regarded as a referenceto arbitration under section 45 of the Co-operative Societies Ordinance,No. 16 of 1936 (now Cap. 107) which had superseded the earlier Ordi-nance at the time when the reference was made. The earlier Ordinancedid not contain provision for the settlement of disputes, but Rule 29provided for reference of certain specified disputes to the Registrar ofCo-operative Societies, who was thereupon empowered either to decideit himself or refer it to arbitration. Notwithstanding the repeal of theearlier Ordinance by Ordinance No. 16 of 1936, Rule 29 and other rulesmade under the repealed Ordinance and in force at the time when Ordi-nance No. 16 of 1936 came into operation w^ere kept alive until replacedby rules made under section 46 of that Ordinance. Although OrdinanceNo. 16 of 1936 itself contained provision in section 45 for the referenceof disputes to arbitration, there were special reasons, as set out in myjudgment in that case, for holding that the reference to arbitrationthere was not under section 45. I do not consider that those reasonsare applicable to the present case.
To pass on to another ground of objection to the validity of the award,the actual terms of reference by the liquidator of the dispute in thepresent case are not in evidence, but it may be inferred that they aresubstantially as set out in paragraj)h 5 of the petition dated the 3rdJune, 1953, by which the liquidator applied to the District Court forenforcement of the award as a decree of Court. According to para-graph 5 the liquidator referred the dispute to the Registrar for decision,and it is contended for the appellant that such a reference is ultra viresof section 40 (1) (d) which only enables a reference by the liquidator ofa dispute for arbitration under section 45. In my opinion, the provisionsof section 40 (1) (d) enabling a liquidator to refer a dispute for arbitrationunder section 45 imply a reference in the first instance to the Registrarwho is the person empowered under that section to refer the disputefor disposal to an arbitrator or arbitrators. I am, therefore, unableto accept the contention that the liquidator should have referredthe dispute directly for arbitration. Besides, such a reference wPuld
M1958) 59 N. L. R. 562.
WEERASOORIYA, J.—Bandahamy v. Senanayake
301
give rise to various difficulties, such as, who should appoint the arbi-trator, the procedure to be followed in proceedings before the arbitrator,the enforcement of the award, etc., in regard to which there appears to beno provision either in the Co-operative Societies Ordinance or the rulesmade thereunder, unlike in the case of an arbitration under section 45.As regards the reference of the dispute in the present case to the Regis-trar “ for decision ”, I consider that the more correct form would be areference to the Registrar for arbitration under section 45. On receiptof such a reference it is the duty of the Registrar to refer the disputefor disposal to an arbitrator or arbitrators in teruia. of section 45 (2) (6).In the present case, notwithstanding that the dispute was referred to theRegistrar “ for decision ”, an assistant Registrar having the same powersas the Registrar referred it for disposal to an arbitrator, who in duecourse gave the award wliich is now sought to be enforced in theseproceedings. In the circumstances I am not prepared to say that theform of the reference adopted in the present case, even if not quite correct,had the effect of vitiating the subsequent arbitration- proceedings andthe award made therein. Moreover, where, as in the present case, anappeal is preferred against the award, the final decision rests with theRegistrar. It may therefor'' even be contended with justification thatthe form of reference is not altogether inappropriate having regardto the ultimate course taken by the arbitration.
In the result I would hold that the appellant has failed to show anygood cause why the award against him should not be enforced as a decreeof Court.
As to the procedure that should be followed by a party seeking toenforce an award in his favour, I am in agreement with the decision ofa bench of three Judges in Jayasinghe v. Boragodaxoatte Co-operative StoresSociety*, and not with the majority decision in The Pinikahana KahaduwaCo-operative Society Ltd. v. Herath-. The views expressed by my brotherPulle in the latter case, that if an award is ex facie regular the Court inwhich it is sought to be executed as a decree has no jurisdiction to testits validity and that notice of the application for execution need not,therefore, be given to the party against whom execution is sought, werebased on sub-sections (4) and (5) of sect on 45 of the Co-operativeSocieties Ordinance which prohibit the decision of a Reg'strar or an awardof an arbitrator referred to therein being questioned in any civil Court.But if I may point out, with respect, the provisions of those sub-sectionscannot possibly be construed as applicable to other than a decisionor award made in proceedings validly taken under section 45, and that* (1955) 56 1ST. L. R. 462.2 (1957) 59 N. L. R. 145.
362
"WBERASOORUfA, J.—Banddhamy v. Senanayake
what purports, ex fade, to be a decision or award does not derive anyvalidity from those provisions merely because it purports to be such.Hence it is necessary that a Court, whose powers are invoked for theenforcement of an award as a decree of such Court (in terms of Rule 38(13) of the rules made under section 46 of the Co-operative SocietiesOrdinance) should afford the party against whom the award is soughtto be enforced an opportunity of showing the existence, if any, of defectswhich render the award a nullity.
The procedure actually adopted in the present case, when the liquidatorfiled the award in the District Court and applied for its enforcementas a decree of such Court, is as laid down in Jayasinghe v. BoragodawatteCo-operative Stores Society {supra). The appellant, who was given noticeof the application, took the objection, inter alia, that the dispute wasnot one which was referable to the Registrar of Co-operative Societies fordecision under section 45 (1) of the Co-operative Societies Ordinanceand that the award was not, therefore, capable of execution. This andthe other objections were rejected by the District Judge after inquiry.If, however, the decision in The PiniTcahana Kahaduwa Co-operative SocietyLtd. v. Herath {supra) is correct, the District Judge acted in excess of hisjurisdiction in holding an inquiry into the validity of the award (assumingit to be ex facie regular) ; nor would it be open to us to go into thatquestion on the hearing of this appeal.
Mr. Jayewardene who appeared for the liquidator argued that thedecision in the PiniTcahana case should be regarded as having the effectof a decision of the Collective Court and, therefore, binding on the presentbench of seven Judges. In dealing with the binding effect of a judgmentof a bench consisting of four or five Judges of this Court, Mr. Jayewardenereferred us to Ordinance No. 21 of 1926, which amended section 54A(now section 51) of the Courts Ordinance. Prior to that amendment theonly power which the Chief Justice had under section 54A was to makean order that any matter pending in the Supreme Court by way of appeal,review or revision be heard by all the Judges, but the amendment madeit possible for him to make an order that any such matter be heard by abench of six, five or four Judges of the Court. Ordinance 21 of 1926was passed soon after the strength of the Supreme Court was increased
< six Judges. Similar ordinances amending section 54A were passedfrom time to time as further increases in the number of Judges tookplace. Section 51^ which has now replaced section 54A, empowers theChief Justice to make an order in respect of any appeal, etc., pendingin the Supreme Court that it shall be heard before all the Judges of suchCourt, or before five or more of them (of whom the Chief Justice shall
WEERASOORIYA, J.—Bandahamy v. Senanayahe
303
be one). Section 51 farther provides that where there is a difference ofopinion, the decision of the majority of the Judges, or, where the caseis heard before an even number of Judges and they are equally dividedin their opinions, the decision of the Chief Justice or any Judge withwhom he concurs, shall be deemed and taken to be the judgment of theSupreme Court.
Mr. Jayewardene also submitted to us a list containing a large numberof cases which, since the passing of Ordinance No. 21 of 1920, had beendecided by a bench of four or five Judges of this Court, and he made thepoint that the large majority of these cases, if not all, are reported asFull Bench decisions in the official law reports and also referred to assuch in some of the judgments themselves. But, as Bertram, C.J.,stated in Jane. Nona v. Leox, which is a decision of the Collective Court,even when that case came up for hearing there was a very strong andcontinuous cursus curiae by which three Judges out of four were con-sidered to constitute the “ Full Court ” and opinions had been expressedin the most unqualified terms to the effect that a judgment of a benchof three Judges was not open to re-consideration. Nevertheless, theCollective Court which heard that case declared (though by a majority)that the cursus curiae should not be followed, on the ground that it wasopposed to the principle that a judgment of this Court is not to be treatedas a judgment of the Collective Court unless, in fact, all the Judges arepresent, and also to the principle that only a decision of the CollectiveCourt should be regarded as binding on another Collective Court.
X am unable to accept the argument of Mr. Jayewardene that sincethat declaration was made the position has changed after the passing ofthe amending ordinances to which he referred. There is nothing in thelanguage of those ordinances which supports his argument. As pointedout by my Lord the Chief Justice, the provisions of section 51 of the CourtsOrdinance that where there is a difference of opinion, the decision ofthe majority of the Judges, or, where the case is heard before aneven number of Judges and they are equally divided in theiropinions, the decision of the Chief Justice or of any Judge with whomhe concurs, shall be deemed and taken to be the judgment of the SupremeCourt, do not deal with the binding effect of the judgment as a precedentbut only with its effect as between the parties. Similar provisions inthe earlier legislation amending section 54A should also be so regarded.
The position as to the binding effect of a judgment as a precedentremains, therefore, unchanged since the declaration of the CollectiveCourt in Jane Nona v. Leo (supra). That declaration affirmed twoprinciples, namely, that a judgment of this Court is not to be treatedas a judgment of the Collective Court unless all the Judges are present,and that only a decision of the Collective Court should be regarded as
1 {1923) 25 N'. L. B. 241.
364
WEERASOORIYA, J.—Bandahamy v. Senanayafce
binding on another Collective Court. More recently in the case ofPerera v. The King1, which was heard by a bench of five Judges of theCourt of Criminal Appeal, it was held that where a bench is constitutedof any number of Judges of that Court in excess of the minimum numbernecessary to constitute the Court, a Full Court would be constituted“ provided the Judges assembled for the purpose of reviewing or recon-sidering a previous decision of the Court ”, and that, therefore, the fiveJudges who heard that case constituted a “ Full Bench In the presentcase, however, we are not concerned with the constitution of a Full Benchof the Court of Criminal Appeal. The principles affirmed in the caseof Jane Nona v. Leo (supra) are, in my opin on, a sufficient answer tothe argument of Mr. Jayewardene that the decision in The PinikahanaKahaduwa Co-operative Society Ltd. v. Herath (supra) should be regardedas having the binding effect of a decision of the Collective Court.
Where a decision is not that of the Collective Court, its value as aprecedent is subject to the further principle that it is not binding on asubsequent bench which is numerically stronger. Even the cursus curiaereferred to by Bertram, C.J., in Jane Nona v. Leo (supra) that decisionsof three Judges (at a time when the Supreme Court comprised of fourJudges) were regarded as binding on a bench of four Judges, went on thebasis that three Judges were considered to constitute the “ Full Court ”,and is not, therefore, a departure from this principle.
As regards the principle that a decision of the Collective Court is bindingon a. subsequent Collective Court, it should matter not, I think, thatsuch a decision represents the opinion of only the majority of the Court.The decision is none the less that of the Collective Court. As regardsthe principle that a decision other than that of the Collective Court doesnot bind a subsequent bench which is numerically superior, it wouldfollow as a necessary corollary that such a decision binds a bench con-sisting of ap equal or inferior number of Judges. Here, again, thereappears to be no reason why the binding effect of such a decision shouldbe whittled down because it represents the opinion of only the majorityof the Judges comprising the bench.
It is in the light of these principles that we should approach thequestion as to the proper procedure to be adopted when an award madein the course of an arbitration under section 45 of the Co-operativeSocieties Ordinance is sought to be enforced. Such a question may be saidto arise in the present case in view of the conflicting decisions in Jaya-singhe v. Boragodawatte Co-operative Stores Society (supra) and ThePinikahana Kahaduwa Co-operative Society Ltd. v. Herath (supra).Accordingly the decision in the Pinikahana case, being that of a benchof five Judges (even though they were divided three to two) shouldbe regarded as overruling the decision in the Jayasinghe case. But atthe same time a bench constituted of seven Judges is not bound bythe decision in the Pinikahana case, and it would be open to us,
* (1951) 53 N. L. B. 193.
DE SILVA, J.—Snnduhamy v. Sennnsiytike
3G5
therefore, to adopt the decision in. Jayasinghe’s case as laying downthe correct procedure (whether we do so unanimously or only by amajority).
I would affirm the order of the District Court and dismiss the appealwith costs.
de Silva, J.—-
As the facts are fully set out in the judgment of my Lord the Chic!Justice which I have had the advantage of perusing, it is unnecessary torecapitulate them. The first question which comes up for decision onthis appeal is whether the liquidator was entitled to refer to arbitrationunder section 45 of the Co-operative Societies Ordinance (Cap. 107) thedispute which arose between him and the respondent. It was contendedthat he was not. Section 40 (1) (d) confers the power on the liquidatorto refer disputes to arbitration. Prior to the amending Act No. 21 of1949 the liquidator was not entitled to exercise this power unless theother party to the dispute consented to the arbitration. Such an arbi-tration lias nothing to do with section 45. Ity section 9 of this amendingact paragraph (<Z) of section 40 (1) was amended by substituting for thewords “ refer disputes for arbitration ” the words “ refer for arbitrationunder section 45 any dispute of any description mentioned in that sec-tion (references therein to the Society being construed as references to theliquidator)”. Section 45 (1) provides that if any dispute touching thebusiness of a registered society arises between the parties specified inthat section <c such disputes shall be referred to the Registrar fordecision”. Sub-section (2) of that section authorizes the Registrar “ (a) todecide the dispute himself, or (b) refer it for disposal to an arbitratoror arbitrators ”. The Counsel for the appellant stressed on the words" Shall be referred to the Registrar for decision ” appearing in sub-section 1 and contended that a liquidator was not entitled under section40 (1) (d), as amended, to refer a dispute to the Registrar for decisionas was done in this case. His position was that a liquidator is entitledto avail himself of only (2) (6) of section 45 which reads <c refer it fordisposal to an arbitrator or arbitrators”. There is no justificationwhatsoever, in my view, for restricting in this manner the meaning ofthe words “ refer for arbitration under section 45‘ any dispute of anydescription mentioned in that section (references therein to the societybeing construed as references to the liquidator)”. If this contentionis right then the liquidator would be entitled to refer the dispute to anarbitrator of his own choice. . The. Legislature could never have allowed
366
DE SILVA, J.—Bandahamy v. Senanayake
such, a situation to arise, for, the other party is not likely to obtain justiceif the liquidator nominated his. own friend as the arbitrator. On theother hand, if the selection of the arbitrator is left to the Registrar sucha dangerous possibility would not arise as he is-an officer of high standing.In my view, the entire machinery for arbitration contemplated by section46 is brought in by the words “ refer for arbitration under section 46”.These words have been used in the amending Act of 1949 because section45 is regarded as the “ arbitration ” section. Therefore the liquidator wasacting within the law when he referred the dispute to the Registrar fordecision.
Another question for decision is whether the liquidator is entitledto refer for arbitration under section 40 (1) (d) as amended by Act No. 21of 1949 a dispute which had come into being before the Act came intooperation. This dispute arose on 19th March 1949 and it was referredto the Registrar for decision on 21st May 1952 while the Act in questioncame into' operation on 24th May 1949. On this point the respondentrelies on section 2 of Act No. 17 of 1952 which came into operation on21st March 1952. The relevant part of this section reads :—
(2) (1) “ Section 45 of the Co-operative Societies Ordinance (here-inafter referred to as the ‘principal enactment’) shall apply in the caseof every dispute of any description referred to in that section amendedby Act No. 21 of 1949 notwithstanding that the dispute may havearisen prior to the date on which that Act came into operation.”
It was contended that section 2 (1) of Act No. 17 of 1952 does notapply to a dispute to which the liquidator is a party as Act No. 21 of 1949did not amend section 45 by bringing in a cla m set up by a liquidatorunder that section. Although it is correct to say that section 45 wasnot so amended directly yet the object was achieved indirectly by amend-ing paragraph (d) of section 40 (1). In my view, the amended paragraph(d) impressed itself on section 45 of the principal enactment. Accordingly,the dispute in the instant case comes within the ambit of section 2 (1) ofAct No. 17 of 1952.
It was also argued by the Counsel for the appellant that when anaward is brought before the Court for execution that Court was entitledto decide the question of the validity of the award. It was also submittedthat unless the Court was satisfied that the award was valid a writ ofexecution should not be allowed. This point was considered in the caseof Pinikahana Co-operative Society Ltd. v. Herath1. My brother Pullestated in that case “ If an award is ex facie regular, the Court in which
1 {1957) 59 N. L. R. 145.
SANS ONI, J.—Bandajiamy v. Senanayake
367
it is sought to execute it as a decree has no jurisdiction, to test its validity,for, if it does so, it would plainly be in breach of the prohibition con-tained in section 45 (4). ’ I agreed with that view and I still adhere to it.The award, in the instant case, which has been reproduced in the judg-ment of my Lord the Chief Justice, in my view, is ex facie regular.On the face of it this purports to be an award under section 45 of Ordi-nance No. 61 of 1936 as amended by Act 21 of 1949. The names of theparties are given and the dispute is succinctly set out in it. There isno ambiguity in regard to the person in whose favour or against whomit is made. It also sets out the Registrar’s order in appeal. The Counselfor the appellant contended that the award should also set out the statusof the defendant in relation to the Society. I think this is unnecessary.Section 45 (4) provides that the decision of the Registrar under sub-section (2) or in appeal under sub-section (3) shall be final and shall notbe called in question in any civil court. The whole object of section45 of the Co-operative Societies Ordinance (Cap. 107) is to devisemachinery for the purpose of deciding the disputes, which come withinthe ambit of that section, speedily and in an inexpensive manner. Thatobject will be, almost completely, defeated if the executing Court werepermitted to inquire into the legality of the award. Sub-section 4 ofsection 45 will be rendered nugatory if it is held that the Court isinvested with such power. In my opinion the law does not require togive notice on the debtor when it is sought to execute an award againsthim.
I would dismiss the appeal with costs.
Sansoni, J.—
On the first and second questions dealt with by my Lord the ChiefJustice, I regret that I am unable to agree with him. I would, withrespect, adopt the reasoning and conclusions of my brother H. N. G.Fernando, and uphold the award in question.
The third question dealt -with by my Lord is whether a Court whichis asked to execute an award “ ex facie regular ” has jurisdiction totest its validity. Here I am unable to agree with the majority decisionin the Pinikahana case1. Nowhere in the relevant legislation is itenacted that an award shall have the force of a decree of the Court whichis asked to enforce it. What section 45 provides for is the enforcementof an award made under the Ordinance, that is to say, an award which :—
is made upon a dispute duly referred under the Ordinance, and
is made by a person duly empowered by or under the Ordinance
to make it.i
Unless these two conditions are satisfied, a document which maypurport or appear to be an award is not in law an award contemplatedby the section. For example, an award made before the Amending
1 (195S) 59 N. L. Tt. 145.
308
SANSONI, J.—Bandahamy v. Sananayake
Act of 1949 in a dispute between a society and a past officer was not avalid award, because the condition (a) mentioned above was not satisfied;such a dispute became duly referable only by virtue of the retrospectiveamending legislation. The Court in the first instance knows nothingabout the genuineness or the validity of a document having the appear-ance of an “ award ”, and its validity must therefore be establishedbefore the Court can legally exercise its powers of enforcement. Thedocument should also be open to attack on the ground that either or bothof the conditions mentioned above were not satisfied in the particularcase, in other words, that the award is one made without jurisdiction.
Now a tribunal may suffer from a patent want of jurisdiction, that is,a want of. jurisdiction apparent on the face of the proceedings. Again,a tribunal may lack inherent jurisdiction over the subject matter of adispute : in other words, it may have no jurisdiction under any circum-stances to deal with that matter. In both these cases consent or acquies-cence will not cure the defect, and orders made by such tribunals area nullity. Such a defect will probably not appear on the face of theorder, but it would be wrong to hold a party bound on that account.Where the order is an award, it is most unlikely to bear on its face theanswers to all the questions which can possibly be asked concerning itsvalidity and the jurisdiction of the person who made it. Section 45 (4)and (5), which was relied on by Pulle, J. in that case goes no further,in my view, than to provide that the reasonableness or correctness of anaward cannot be questioned by way of an appeal : by this I mean that,provided the arbitrator acts with jurisdiction, an erroneous exercise ofsuch urisdiction is not subject to correction by appeal. When a Courtis asked to execute an award it is bound to satisfy itself that the awardis a valid one, in the sense that the person who made it had jurisdictionto do so, and to arrive at its decision only after the party sought to beaffected has been asked to show cause, if any. It is his property thatit is intended to seize, and he must be heard before a judicial order forthe issue of a writ of execution is made. It would be contrary to naturaljustice to make the order without first hearing him.
An order which is a nullity hurts nobody so long as it is not soughtto be enforced. The party against whom it was made may choose, if itwas made without jurisdiction, to have it quashed by writ of certiorarior by declaratory action ; but he is also entitled to wait until proceedingsare taken to enforce it against him, and then attack its validity. IfI am correct in my view that a Court should be satisfied that an awardis valid before enforcing it, I think it follows that the Court should notbe confined, when holding an enquiry into this matter, to a mere perusalof the award alone. I dissent from the view that an award made withoutjurisdiction must be executed merely because it does not bear any fatalflaws on its face. So to hold would be almost to say that a Court shouldlend its process to be used to execute an order that appears to be valid,
SANSONT, J.—Bandaharay v. Senanayahe
3G0
even though it may well be a nullity, and should not allow an inherentvice to be exposed. Such a view can even lead to the absurdity thata Court may perforce have to enforce an award which may in fact havebeen made by some person who, without any reference having been madeto him by the Registrar, arrogates to himself the powers of an arbitrator.
I am unable to accept such a view unless the statute in express termscompels me to do so.
As to the procedure which should be adopted to enforce an award, Iagree with the decision in Jayasinghe’s case 1, and I disagree with thedecision of the majority in the Pinikahana case2 on this question.
I do not, however, agree that the latter decision with regard to the powerand duty of the Court which is asked to execute an award, is obiter.The principal question which had to be decided in that case was, no doubt,the validity of rule 3S (13), but it was necessary for the judges on thatappeal to go into the other matters also. The District Judge had held,after noticing the party affected by the award, that the award was bad.Pulle, J. and the other judges who agreed with him took the view thatas the award was ex facie regular it could not be questioned. They alsotook the view that it was not necessary for a Court to satisfy itself of thevalidity of an award before executing it, or to give the party, who wassought to be reached by the writ, notice of the application for execution.They accordingly set aside the order which the District Judge had madein that case, and directed that the award should be executed. Thosedecisions were, it seems to me, necessary for the final disposal of thatappeal.
If this Bench is bound by the decisions in the Pinikahana case becausethey were decisions of a Bench of five judges, we must loyally followthose decisions, however strongly we may disagree with them. But inmy view a Bench of seven judges is not bound by the decision of a Benchof five judges. The decisions from Emanis v. Sadappn3 to Jane Nona v.Leo4 have consistently proceeded on the basis that only a decision of theCollective Court, that is, a Court composed of all the judges, binds futureBenches until it is set aside by legislation or a decision of the Priv3' Council.Other decisions of this Court have always been regarded as liable to beoverruled by a numerically stronger Bench. Here I would express theview that it is the numerical strength of the particular Bench that de-cides the binding nature of the decision, regardless of whether the judgesare unanimous or divided- For example, I think that a decision of theCollective Court of five judges, given at a time when five judges composedthe entire Bench, had and still has all the force and authority of a Col-lective Court decision, even though the judges may have been dividedthree to two ; and it cannot be overruled or dissented from by a laterBench of seven judges (not being a Collective Court) even though their 1 2
1(1955) 56 N. L. R. 462.'3 (1806) 2 -N. L. R. 261.
2(1957) 59 JV. TV. R. 145.* (1923) 25 N. L. R. 241.
370
SANSONT, J.—JBandahamy v. Senanayake
decision be unanimous. If, therefore, the present Bench of seven judgeshad been bound by the earlier decision of five judges, it would make nodifference to my mind that we should be unanimous while the five judgeswere divided three to two.
Mr. Jayewardene submitted that the binding character which formerlyattached only to Collective Court decisions should be extended, afterthe passing of Ordinance No. 21 of 1926 and the later Ordinances con-taining similar provisions which now appear as S.51 of the CourtsOrdinance, to decisions of Courts constituted under those Ordinances.His argument was that the legislature intended to obtain from suchCourts decisions els binding and authoritative as a Collective Courtdecision. Mr. Perera, on the other hand, argued that the only objectof the amending legislation was to obtain decisions on difficult questionsof law. Whatever the purpose of that legislation may have been, I canfind no support for Mr. Jayawardene’s view in the language of thoseOrdinances. In the result, the position remains unchanged, and if itis desirable that a new convention should be laid down, I think it canbe laid down only by a Collective Court and no other ; for a Court ofseven judges cannot presume to bind a Collective Court of nine judgeson such a matter.
Mr. Jayewardene also urged that the reference of a particular questionof law to successive Benches, each numerically stronger than the previousone, will, have the effect of unsettling the law. I entirely agree thatit is undesirable that conflicting decisions should be given from time totime. It is necessary to strike a balance between the inconveniencecaused by disturbing the law on the one hand and the perpetuation ofjudicial error on the other. It is a sound rule, to quote Jagannadhadas, J.in The Bengal Immunity Co. Ltd. v. The State of Bihar1, that “ what aprevious decision has determined must be presumed to be right unlessit can be pronounced to be perverse or manifestly wrong.” If I maycontinue to quote :“It is, therefore, a strong thing to charac-
terise a previous decision as erroneous where, even on reconsideration,no unanimity is reached and the previous view is supported by a sub-stant:al minority.” As the learned judge said there, while the compe-tency of the Court to reconsider its prior decisions cannot be denied,“ it does not follow that such power can be exercised without restrictionor limitation, or that a prior decision can be reversed on the ground thaton later consideration the Court disagrees with the prior decision andthinks it erroneous.” It may be that such considerations as theseimpelled the legislature to vest in the Chief Justice alone the power to
i A. I. R. (1955) S. G. 661.
H. N". G. FERNANDO, J.—Bandahamy v. SenanayaJee
371
make order that a case shall be heard by a Bench of five or more judges.While I do not think that the decision upon a particular question of aBench constituted under Section 51 of the Courts Ordinance would binda numerically stronger Bench, yet, when such a decision exists, onlyquite extraordinary circumstances would in my opinion necessitate orjustify a second reference of the same question to a stronger Bench.
X would dismiss this appeal with costs.
H. N. G. Fernando, J.—Counsel for the appellant prefaced his argument in this case by statingthat he would not question the correctness of the decision of the majorityof the Bench in The Pinikahana Kahaduwa Co-operative Society, Ltd. v.Herath1 to the effect that the Rules under the Co-operative SocietiesOrdinance providing for the filing in District Courts, and the enforcementby such Courts, of arbitration awards made under Section 45 of thatOrdinance are intra vires. He stated also (and quite rightly) that thecontentions which he proposed to raise on behalf of the appellant inthis case would not entail the need for us to over-rule any previousdecision of this Court.
In order to appreciate the principal point taken in support of thisappeal, it is necessary to refer to certain relevant provisions of the Co-operative Societies Ordinance (Cap. 107). Section 45 (1) of that Ordi-nance (in its original form) provided that “ if any dispute touching thebusiness of a registered society arises ” among certain persons mentionedin the sub-section or between the society and certain persons so men-tioned, “ such dispute shall be referred to the Registrar for decision.”Originally the only functionary of a society who was mentioned in thesub-section was an “ officer ” of the society. By an amendment intro-duced by Act No. 21 of 1949 sub-section (1) was altered inter alia by sub-stituting for the expression “ any officer of the Society ” the much widerexpression “ any officer or employee of the Society, whether past orpresent, or any heir or legal representative of any deceased officer oremployee ”. In the result Section 45 as so amended enabled a disputearising between a society and any officer, whether past or present, to bereferred to the Registrar under Section 45 (1).
In view probably of the decision of this Court in Mulgirigala Co-operative Stores Society, Ltd., et al. v. Charlis2 there appears to have beena doubt whether a dispute between a society and an ex-officer, whichhad arisen prior to the coming into operation of the amending Act of 1949,could legally be referred to the Registrar under the amended Section45 (1). According^ a special Act, namely Act No. 17 of 1952, wasenacted, the principal provision of which was as follows :—“ 2 (1). Sec-tion 45 of the Co-operative Societies Ordinance (hereinafter referred to
1 {1957) 59 X. L. li. 145.
a (1951) 52 N. L. It. 507.
372
H. N. G. FERNANDO, J.—Bandahamy v. Senaruxyake
as the “ principal Enactment ”) shall apply in the case of every disputeof any description referred to in that section as amended by Act No. 21of 1949 notwithstanding that the dispute may have arisen prior to thedate on which that Act came into operation …. For the
present purposes it is sufficient to note that after the enactment of ActNo. 17 of 1952 a dispute between a society and a past officer was referableunder Section 45 (1) irrespective of the time when it had arisen.
It is necessary also to examine some of the provisions relative to thedissolution of a registered Society. The principal Ordinance provided(Section 36) for the cancellation of the registration of a society and forthe appointment. (Section 39) of a liquidator or liquidators. Section40 provided inter alia, in sub-section (1) (d), that a liquidator shall havepower to “ refer disputes to arbitration and institute and defend suitsand other legal proceedings on behalf of the Society by his name oroffice **. It is common ground that the expression “ refer disputes toarbitration ” in this context, did not give the power to a liquidator tocompel some person with whom he had a dispute in his capacity as liqui-dator to accept the process of compulsory arbitration for which Section45 provides, and that the power given by Section 40 (1) (d) in its originalform was a power only to have a dispute decided by arbitration if theother party concurred in that course. (Ekanayaka v. Prince of WalesCo-operative Society, Ltd.1). But in respect of this matter also the amend-ing Act No. 21 of 1949 introduced into paragraph (cZ) of Section 40 (1)new provisions by which the liquidator was given the following power,that is to say, to “ refer for arbitration under Section 45 any dispute ofany description mentioned in that Section (references therein to thesociety being construed as references to the liquidator)”.
It is useful at this stage to refer to some of the facts of the presentcase. The Udapola Co-operative Stores Society had been in existenceuntil 9th March 1949 on which date the Registrar had. cancelled the regis-tration of the society. The respondent to this appeal had been appointedliquidator on 3rd December 1948. (I should add that no argumentwas based upon the circumstance that the date of the liquidator’s ap-pointment preceded the date of the cancellation of the society’s registra-tion.) The present appellant had been the Treasurer of the societyuntil 19th March 1949 when he ceased to hold office, and it is commonground that on the same day (19.3.49) a dispute a-ose between therespondent as liquidator and the appellant, the question in disputebeing whether the appellant owed the respondent a sum of Rs. 560.74in respect of te leakages in textiles ”, On 21st May 1952 the respondent“ in accordance with the provisions of Sections 40 and 45 (1) of theOrdinance ” referred the dispute to the Registrar of Co-operative Societiesfor decision and thereafter an assistant Registrar referred the dispute fordisposal to one Mr. Banda who according to the respondent ££ acted asarbitrator in accordance with the provisions of Section 45 (2) ”.
• – -i (1949) 50 N. L. R. 297. *
H. N. G. FERNANDO, J.—Bandahamy v. Senanayake
373
Upon these facts the argument for the appellant has been in substanceas follows :—
Until the coming into operation of Act Xo. 21 of 1949 the principal
Ordinance did not enable a liquidator to refer a dispute forarbitration except with the consent of the other party, and inthis instance there was no such consent from the appellant.
After 24th May 1949 a liquidator did have the power to secure
compulsory arbitration in the case of a dispute, but this newpower was only prospective, and was exercisable only in thecase of a “ new dispute ” that is to say, a dispute arising after24th May 1949.
The dispute in question admittedly arose on 19th March 1949.
It was governed by the former, and not by the present paragraph
of Section 40 (1), and the liquidator did not therefore havethe power to make a reference to compulsory arbitration.
This argument for the appellant gains support from the fact thatAct No. 17 of 1952 specifically declared that Section 45 of the principalOrdinance, as amended in 1949, applied to disputes which arose beforethe date of the 1949 amendment. There being no similar specific decla-ration in regard to the new paragraph (d) of Section 4.0 (1) (which alsowas introduced in 1949), that paragraph does not, it is said, apply todisputes which arose before its introduction.
Gratiaen, J., in Nawadun Koval e Co-operative Stores Union, lAtl. v.W. M. Premaraina1 had occasion to refer to the reason why a specificdeclaration w'as necessary in the case of Section 45. As amended in1949, sub-section ^1) of that section provided that<c if any dispute arises ”(of a specified description) “ such dispute shall be referred to the Registrarfor decision ”. A dispute which had arisen prior to the 1949 amendment,and was not a dispute of a description mentioned in the original sub-section (I), would not bo referable by virtue of the amendment. A dis-pute of any new description (i.e. of a description added, in 1949) wouldbe referable only if it arises after the amendment.
One contention for the respondent has been that the phraseology ofSection 4C (1) does not create any similar difficulty because it does notcontain the clause “ if any dispute arises ”. Therefore it is said theparagraph gives power to refer any dispute of a description mentionedin Section 45 (l), without any restriction as to the time when the disputearose. But there is in my opinion cogent reason for rejecting thiscontention.
Bet me examine the position as it was when Act No. 21 of 1949 wasenacted. At that time Section 45 provided that a dispute betweena society and a past officer was referable to the "Registrar for compulsory
1 (1954) 55 N. L. It. 505-
374
H. N G. FERNANDO, J.—jBandahamy v. Sencmayake
arbitration, but the section did not apply to a dispute which had. arisenprior to 24th May 1949. By the same Act the Legislature adopted forutilization by a liquidator the process of compulsory arbitration ■whichSection 45 had enacted for the benefit of a society. In thus adoptingthe process of compulsory arbitration the Legislature could not haveintended that the restriction as to time implicit in Section 45 would notbe applicable when a liquidator utilizes the process. The expression“ any dispute of any description mentioned in Section 45 (1) ”, whichoccurs in paragraph (d) of Section 40 (1) covers both the express defini-tion as to persons in sub-section (1) of Section 45 (subject to the substi-tution of “ liquidator ” for “ society ”) as well as the definition as totime which is implicit in that sub-section.
The respondent’s other contention is however entitled to succeed. Aspointed out above, the Legislature’s intention, in enacting Section 40 (1)
(d) was to “ adopt ” for a case of a dispute with a liquidator, the processof arbitration provided for in Section 45. The first step in that processis the act of referring a dispute to the Registrar, which act is mentionedin sub-section (1) of Section 45 in the passive form “ every dispute .shall be referred to the Registrar In that sub-section itself no men-tion is made of the person or persons by whom a dispute may or shallbe so referred : that matter is left to be provided for in the appropriaterule. Similarly, in my view, paragraph (d) of Section 40 (1) authorizesa liquidator to refer a dispute for arbitration or, in other words, empowershim to do the act mentioned in sub section (1) of Section 45. If for instanceit were necessary to draw up a proper formal document in a case wherea liquidator does refer a dispute, would it not be essential to state thatthe reference is being made “ under ” or “ by virtue of” Section 45 (1),for the reason that the “ activity ” of making the reference is statutorilyprovided for in Section 45 1 Another example from the same Ordinance(Cap 107) may serve to demonstrate that the act of referring is one doneby the liquidator under Section 45. Section 2 enables the Minister byorder to confer on an Assistant Registrar any power of a Registrar underthe Ordinance. If then, such an order of the Minister, in whatever termsit be phrased, authorizes an Assistant Registrar to cancel the registrationof a society under Section 36 or to decide a dispute under Section 45 (2),the act of cancellation or the act of deciding will be performed by theAssistant under Section 36 or Section 45 (2). Ihe act itself can be per-formed only because the relevant section authorizes the act, and theorder under Section 2 merely adds to the category of persons entitledto perform the act. It has been pointed out that in paragraph (A) ofSection 41 (also amended in 1949) there is a phraseology which appearsto recognise that a reference by a liquidator is one under paragraph (d).I do not think however that this phraseology, occurring in a paragraphwhich does not in any way affect paragraph (d), but merely refers todisputes outside the scope of paragraph (c£) can be relied on for the pur-pose of altering the true construction of paragraph (d) and of Section45 (1) read together.
H. T'T. G. rFBNANDO, J.—Bandnhnmy v. Senanayake
37">
The contention which my Lord the Chief Justice has referred to asthe first question for decision was according to my recollection not seri-ously pressed by counsel for the appellant. In view of the terms ofSection 40 (1) (d), empowering a liquidator “ to refer for arbitration underSection 45 any dispute …. it was contended that a liquidator
cannot, as he did in this case, refer a dispute to the Registrar for decision,but that instead his only power is to refer it for arbitration directly.If the latter construction be accepted, namely, that the liquidator canonly refer the case for arbitration, it would seem that by implicationthe choice of an arbitrator will lie with the liquidator himself. Such asituation would be in my opinion very nearly absurd in that the choiceof a single arbitrator would then be made unilaterally by one party toa dispute. I therefore much prefer the construction that the Legisla-ture intended that the arbitrator should be chosen by the Registrar andnot by a liquidator.- This construction derives support from the pro-visions in Section 40 which directs a liquidator to act under the guidanceand control of the Registrar. If then the Registrar has to choose anarbitrator in a case where the b’quidator proposes to exercise his powerunder Section 40 (1) (d), there is no doubt that the first step will befor the liquidator to communicate in some mode with the Registrar.The mode which the liquidator adopted in this case was thatwhich Section 45 (1) expressly provides in relation to societies stillin existence, namely, the reference of the dispute to the Registrar for de-cision. Under sub-section (2) of Section 45, the Registrar would there-upon either decide the dispute himself, or else refer it to some otherperson for arbitration. It was the latter course which the Registrartook, in this case.
If it be correct that a dispute mentioned in Section 40 (1.) (d) cannotbe decided by the Registrar himself, the fact that the liquidator mis-takenly referred it to the Registrar for decision, did not result in anyinfringement of the law since as things turned out the dispute wasactually decided by a person chosen by the Registrar as arbitrator andnot by the Registrar himself. The question whether the Registrarcould have decided the dispute himself dees net therefore arise, butsince it has been raised before a Bench constituted as we are, I feelit proper to express the opinion that the Registrar does have power todecide himself a dispute referred under Section 40 (1) (d). The questionreally turns on the interpretation of the few words which occur in para-graph (d). Do they mean ** refer for arbitration under Section 45 ”, orelse do they mean “ refer under Section 45 for arbitration ”? While thematter is not free from difficulty, I can see no reason why the meaningsecondly given above should not be accepted. As I have observedearlier in this judgment, the act of referring a dispute is an act contem-plated principally or substantially in Section 45 (1), and Section 40 (1)(d) only empowers a liquidator to perform that act, which when heperforms it, is an act done under Section 45 (1).
376
H. N. G. FERNANDO, J.—Banduhamy v. Senanaynke
The construction X prefer appears perfectly reasonable from a practicalpoint of view. In as much as the Registrar clearly has power to decidea dispute between a Society and a member or officer, one can think of nocircumstance which might have induced in the mind of the Legislaturean intention that merely because a society is in liquidation, the Registrarshould not participate in disputes arising between the Liquidator and anyof the same persons. Such an intention was indeed evinced in the termsof Section 41 (h), but there the legislature was not providing for an“ internal dispute ”, but rather for a dispute in which a third party isinvolved. Even Section 45 does not empower the Registrar himself todecide a dispute between a society and a third party. I would holdtherefore that the power to decide a dispute conferred by Section 45(2) can be exercised by the Registrar in the case contemplated in Section40 (1) {d).
The only ground of objection raised in the District Court by the appel-lant against the application made by the respondent to this appeal for anorder absolute that the award dated 19th August 1952 be enforced as adecree of the Court, was the following :—
“ The respondent denies that he owes any sum of money to the
Plaintiff’s Co-operative Society.
“ The respondent denies that the dispute was one which could
have been referred to the Registrar of Co-operative Societiesfor decision under Section 45 (1) by the Co-operative SocietiesOrdinance (Cap. 107).
“ The respondent therefore states that the award referred to in the
petition is not capable of execution.”
The Judge’s note of the argument and his order indicate that no pointswere taken by the appellant’s counsel in the District Court, other thanpoints with which I have dealt above. Indeed it is more than doubtfulwhether some of those matters were even raised in the District Court.In any event, for the reasons which I have stated, the objection +akenby the appellant in his statement of objection was rightly rejected by theDistrict Judge.
The question whether a District Court should, before enforcing anaward made by an arbitrator under the Co-operative Societies Ordinance,be satisfied that the award is a valid one, does not properly arise fordecision in this appeal, because the appellant was in fact given an oppor-tunity to challenge the validity of the award made against him. MyLord the Chief Justice and my brother Sansoni are both of opinion thatthis question was incorrectly decided by the majority of the Court inThe Pinikahana Kahaduwa Co-operative Society, Ltd. v. Herath1. I agreewith that opinion, and would adopt the reasons therefor set out bySansoni, J. in his judgment in this appeal'.
1 (1958) 59 N. L. B. 145.
H. 2ST. G- FERNANDO, T.—Bandahatny v. Senanayake
377
As the present Bench happens to consist of seven Judges I do not doubtthat we have power to over-rule the decision in The Pinikahana casewhich was decided bj' a majority of three out of five Judges. I thinkit is only a Collective Court in the strict sense, constituted of all theJudges, which can hold that a decision of any Bench should bind anumerically stronger one.
Nevertheless the experience of tliis appeal shows that it is inconvenientand even undesirable that a question once referred under Section 51 ofthe Courts Ordinance should again be referred under that Section. Priorto 19?0, the former Section 54A provided only for a hearing by a CollectiveCourt whose decision was of course regarded as binding. It seemsto me that the only reason why the Legislature altered the law in suchmanner as to authorise the reference of a case to a Bench consistingof less than all the Judges of the Court was that, with the increase inthe number of Judges, it would be highly inconvenient and sometimeseven impracticable to assemble a Collective Court. While the Legislaturedid not declare nor intend that a decision of a Bench constituted underSection 51 will bind a numerically stronger Bench, it was not in myopinion anticipated that occasion would arise, save in very extraordinarycircumstances, for such a decision to be reviewed by a Bench ofnumerically greater strength.
Having regard to the cursus curiae, it seems indisputable that anyBench of this Court will follow a decision of a numerically stronger Bench.Therefore, no Bench of one, two or three Judges sitting in the normalcourse as provided by Section 38 of the Courts Ordinance, even thoughthe Chief Justice be a member thereof, can judicially disagree withthe previous decision of a Bench constituted under Section 51. Thiscircumstance led me during the argument to venture, with the utmostrespect, the opinion that the Chief Justice himself would not exercise hispowers under Section 51 merely because of personal disagreement witha previous decision of a Bench constituted under that Section.
The necessity for a sitting of this Court under Section 51 could arise,either in order that upon some question of special importance or difficultythere should be a decision of a numerically stronger Bench than is en-visaged in Section 38, or else in order that a conflict of opinion amongJudges sitting as provided in Section 3S may be resolved by a decisiongiven under Section 51. In either event the purpose thus served is theavoidance of controversy or the ending of pre-existing controversy.
Controversy would commence or be revived, and this purpose defeated,if decisions given under Section 51 are regarded as'being re viewable.Only the clear appearance of manifest error in such a decision would inmy opinion justify a subsequent reference for the purposes of review.Finally, as the matter has been discussed, I have to state my opinionthat the cursus curiae does not require that a Bench of two Judges mustfollow a former decision of another Bench of two Judges. Our Law
378
SESTiTETAMBY, J.—Sandahamy v. Sencma.ya.ke
Reports reveal .that the limited right to disagree with a former decisionof a Bench of equal strength has quite often provided a mode of correctionof error more convenient and expeditious than that available underSection 51.
I would dismiss the appeal with costs.
SrtTNETAMBY, J.
I may mention that I am writing this short note, embodying my viewson the questions that arose for decision in tliis case, while on leave inEngland. My Lord the Chief Justice requested me to do so as my brotherPulle is due to retire a few days before I resume duties, and it was con-sidered desirable that the Judgment of the Supreme Court should bedelivered while my brother still held office. I should, ordinarily, havedesired to discuss fully the grounds of my decision, but I am severelyhandicapped by the fact that a full and complete library is not readilyavailable for my use. I shall, therefore, content myself with expressingmy opinion briefly on the many matters that were fully and ably arguedby the learned Counsel who appeared on either side. My Lord theChief Justice very kindly sent me a draft copy of his judgment : I havealso seen copies of the judgments prepared by my brothers Weerasooriya,Sansoni and Fernando.
In regard to what My Lord has referred to as the first question, I agreewith my brothers Sansoni and Fernando that a liquidator of a Co-operativeSociety, after the amendment of 1949, can refer any dispute of the kindthat arose in this case to the Registrar for decision, and that the Registrarmay either decide it himself or refer it to an arbitrator. I do not agree■with the view that in these circumstances all that the Registrar can do iswhat he actually did in this case ; namely, refer it to arbitration and notdecide it himself.
My opinion on the second question referred to in the Chief Justice’sjudgment is in accord with the opinions expressed by my brothersWeerasooriya, Sansoni and Fernando. In my new the liquidator hadjurisdiction to refer the dispute in this case to the Registrar, eventhough the dispute in question arose before the amending Act of 1949came into operation. I
I shall now come to the consideration of another question ; namely,the meaning to be attached to the observation of Pulle J. in the Pini-Icahana case. I have unfortunately not seen my brother Pulle’s judg-ment in this case, and am not aware of the exact interpretation he placeson bis words:I agree with my brother Sansoni, however, that the
opinion expressed by Pulle J. cannot be regarded as obiter. I also agreewith him that it is open to the respondent to an application for execu-tion of an award to question its enforceability on the ground that it was
SINTTETAMBY, J.—Bandahatny v. Senannynke
379
not made in accordance with the provisions of Section 45. What hasbeen made final and immune from attack in a civil Court by section 45
and section 45 (5) are decisions and awards made in accordance withthe provisions of section 45 (1), (2) and (3). A decision or award, whichis not made in accordance with those provisions, is not free from attack ;and I cannot agree with the proposition that, under no circumstances,can a respondent question the validity of an award. As my brotherSansoni points out, what he cannot question is the correctness or reason-ableness of the award on the facts. Even if, on the facts, the decision oraward is both incorrect and unreasonable, it camiot be called in questionif the other provisions of Section 45 have been complied with.
I do not, however, agree with my brother Sansoni that before allowingwrit to be issued the Court should first notice the respondent and givehim a hearing. Cratiaen J. observed in Barnes de Silva case1 :—
“ It is the clear duty of a Court of law whose machinery as a courtof execution is invoked to satisfy itself, before allowing writ to beissued, that the purported decision or award is prima facie a validdecision made by a person duly authorised under the Ordinance todetermine a dispute which has properly arisen for the decision of anextra judicial tribunal under the Ordinance
How then is the Court to be satisfied prima facie that the decision,or award is one duly made under the provisions of the Ordinance. Ab-solute proof is not necessary and, in my view, prima facie proof canbe established by a petition with supporting affidavits. One. mustnot lose sight of the fact that the object intended to be achieved bySection 45 of the Ordinance was to secure a speedy settlement of disputesof the kind contemplated as well as speedy recovery of the amount foundto be due. It was because of the delay involved in regular Court pro-ceedings that jurisdiction in the case of such disputes was taken awayfrom the Courts and vested in extra judicial tribunals. In my viewit would be sufficient if a prima facie case for the issue of writ has beenestablished by ex parte affidavit evidence. I do not think it would beagainst the principles of natural justice in an appropriate case toallow Issue of writ without first hearing the respondent. In these casesthe respondent is heard before an award is made, and it is reasonableto assume that he is aware of the nature of the award which is requiredto be pronounced in his presence. It is always open to him, perhapsunder Section 344 of the Civil Procedure Code, to- intervene and askfor stay of execution on good grounds ; and, if his property is seized ona writ found to have been improperly issued, he is entitled to obtainsatisfaction in an action for damages.
1 (1953) 54 A7. L. R. 326.
380
SINNETAMBY, J.—JBcmdahamy v. Senanayake
Instances are. not wanting in our civil procedure where write arepermitted to issue on ex parte applications. I may mention as examplesapplications for sequestration or arrest before judgment. I fail to see whyin every application for execution made under Rule 13, the procedureshould require the respondent to be noticed before the issue of writwith all its consequential delays—delays with which we are only toofamiliar, caused by judgment debtors who employ avoiding tactics. Inmy opinion, therefore, if the Court is satisfied that the award is primafacie a valid award, it is bound to issue writ, leaving it to the Respondentto show that what purported to be a valid award was in fact onewhich was not made in terms of Section 45. In the present case, for thereasons which My Lord the Chief Justice has set out in his judgment,it cannot be said that the award is ex facie regular or that its “ validity ”had been established prima facie. In as much, however, as the respon-dent had been heard before the issue of the writ, no injustice has beendone and there appears to me to be no ground for setting aside the orderof the learned District Judge.
On the question of stare decisis I agree generally with the observationsof My Lord the Chief Justice subject however to the following :—
A decision by a bench of five or more Judges convened by theChief Justice under Section 51 (1) of the Courts Ordinance carriesin my opinion, the same authority as a decision of a Full Bench.
It makes no difference that the Bench is divided ; a judgment ofthe majority will have the same binding effect as an unanimousdecision.
In regard to the first qualification I was much impressed with theargument put forward by Mr. H. W. Jayewardene and I believe thatthe present amendment to the Courts Ordinance was made to avoid theneed for all the Judges to assemble as a collective court to give theirdecision the binding effect of a Bull Bench.
In regard to the second qualification it seems to me to be revolutionaryto hold, for instance, that a single Judge sitting alone is not obliged tofollow a decision of a bench of 7 Judges, merely because three of themdisagreed with the opinions of the other four.
I would accordingly dismiss the appeal with costs.
Postscript
Since writing the above I have seen the judgment prepared by mybrother Pulle. I am glad to note that he too does not regard hisobservations in the Pinikahana case as obiter.
Appeal dismissed.