Thursday, March 1, 2012

A Bird's eye view of the Law of Limitation

A Bird's eye view of the Law of Limitation

By : Bharat Chugh - Advocate (Delhi on 22 February 2012
 
 
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The Laws of Limitation are statutes of peace and repose, statues that manifest the policy of law in lending its aid only to those who are vigilant and not those who sleep over their rights (Vigilantibus Non Dormentibus Juria Subvenient). Limitation laws suggest that all disputes/claims/remedies should be kept alive only for a legislatively fixed period of time, for otherwise disputes would be immortal when man is mortal. Though arbitrarily fixed limits may seem unfair to some, however they are most pragmatic insofar as there is rarely any justice in stale claims - and evidence also gets destroyed, hence keeping remedy alive serves no useful purpose. 

 

Law of Limitation is rigid - courts have no power to free the litigant from its shackles by using its inherent powers, however the rigidity of the law has been cut down by providing the principles of exception & Exclusion (S.4-24 of the Limitation Act, 1963) these principles make just allowances ex debito justitate and are based on one rational principle or the other. 

 

S.3 - of the aforesaid act - mandates the court to dismiss a suit even though limitation is not set up as a defence. Normally in actual practise - court frames a preliminary issue on the question of limitation as the same relates to a bar of law, if the bar of limitation is apparent on the face of the plaint - it may also entail Rejection u/o 7 R 11 of the CPC. Otherwise evidences are taken - which leads to a dismissal or the suit continues. 

 

It is pertinent to remember that Limitation Act does not extinguish the right but negatives its remedial qualities – by turning it into an imperfect right – i.e right without a corresponding remedy. Since it seemingly is at cross purposes with the celebrated maxim of ubi jus ibi remedium – courts have constantly held that when there are two views possible one that saves the remedy should be preferred.

 

Some Important Areas of the Law of Limitation.

 

S.4 - is based on the principle of actus curiae neminem gravabit - Act of Court shall prejudice no man, and lex non cogit ad impossibilia. When the period of limitation of insttituing a suit, making an application or filing an appeal expires on a day when court is closed (completely or during any part of it's working hours) the same can be done on the day when court re-opens. In a catena of decisions problems arose as – case was filed in a wrong court and then S.4 was attempted to be read together with S.14 – to exclude that period. However this contention was negative by the SC in Ami Chand v. UOI (1973) placing reliance up PC Decision in Maqbul Ahmed v. Pratap Narain. That to gain the benefit of S.14 – original suit should have been filed within the prescribed period. Which was not the case here – as S.4 being a principle of exception allows filing after PP is over as opposed to one excluding the period or the POL. Hence the court for the purposes of S.4 means proper court.

 

S.5 - also is a principle of exception – which allows filing (appeal & applications (other than O.21) after the expiry of Prescribed Period – if sufficient cause is shown. The phrase 'sufficient cause' has to be interpreted liberally, keeping in mind at all times that a litigant normally does not stand to benefit from delay – on the contrary there is always a chance of his losing his right altogether. Hence an interpretation that advances substantial justice has to be accorded. Court's have to show utmost consideration to a suitor unless malafide or negligence is attributable to him. In this regard, barring a few decisions, courts have repeatedly refused to make special exceptions in favour of government, notwithstanding the impersonal  machinery. However J.Chandrachud however in G.Ramegowda v. Special Land Acquisition officer (1988) has held that a certain amount of latitude is not entirely impermissible. Taking cue of this lower courts have been apparently letting the burden of proof of discharging 'sufficiency' fall light upon the government. Which is a prudent practice, since in a variety of cases – the adage "what is everyone's is nobody's in actuality' becomes true – and it is the tax payer/revenue that suffers when the government lapses.

 

S.6/7/8 – together represent a well knit legislative scheme wherein – limitation period is excluded during period when litigant could not have sued on account of minority/insanity/idiocy. However such disability should be present at the time from which the period of limitation is to be reckoned. Subsequent disability/inability would not stop the continuous running of time (S.9). However strict application of this rule would have done injustice to other party, insofar as their rights would be uncertain for long periods of time. To counter this – full period of limitation to be accorded after disability ceases is elongated to a maximum of 3 years. This strikes a perfect balance of conflicting interests of the disabled and the other party.

 

The Principle of Continous running of time is suspended only in one situation where – the hand to give & receive is the same i.e to prevent conflict of interest and duty. This is envisaged in S.9 Proviso – wherein during the time a debtor holds the letter of administration of his creditor, the period of limitation for recovery of debt stands suspended.

 

S.10 – envisages the principle of no limitation in matters of trust expressly created for specific purposes. In common parlance a trustee is not immune from legal proceedings with respect to any suit relating to property in his hands as a trustee, by any length of time.

 

S.11 – makes clear that the period of limitation has to be seen w.r.t lex fori – i.e the law of the forum where the action is brought and not the one where the contract was formed (lex loci contractus)

 

S.12 – excludes the day from the Period of Limitation is to be reckoned, plus when a decree/order is appealed against the date of judgment – the time properly required in obtaining a copy of the judgment/decree.

 

S.13 – provides for a situation where leave to sue in forma pauper is sought (u/o 33 of the CPC) is rejected – and the applicant later pays up the court fees. This principle deems court fee as paid in the first instance, and negatives the chances of a situation where period of limitation has lapsed during the prosecution of such application.

 

S.14 – a principle frequently pushed into action – where a person spends time pursuing a remedy in a court which from jurisdictional incompetency is unable to try it. However if the person does so without due diligence i.e without due care and caution. He is not allowed to exclude that period from the overall period of limitation. Here a little flexibility is projected by the courts as at least some amount of lack of diligence/indiscretion is implicit in very act of filing it in the wrong court, however the same should not amount to a complete carelessness – if the benefit of this section is to be sought.

 

S.15 - also excludes certain periods – for eg: where filing of a suit or execution application is stayed – the period during which the stay operates is excluded in computing the period of limitation. Other exclusions include – time taken in taking a sanction/permission or where the defendant(s) are outside India, or where a purchaser at a court auction seeks to sue for possession – the period during which such sale in which he gets title is sought to be set aside – is excluded.

 

S.17 - manifests the policy of law – that fraud ought to benefit none – and no amount of time – can turn an illegality into legality. It sends out a clear message to those in fraud – that by no lapse of time can they be allowed to keep the fruits of their ingenious villainy. This principle excludes the period during which a person was labouring under fraud so as to be unaware of his right and its violation, or could not bring a suit as he was forced not to. Though period after which the person could have discovered with reasonable diligence the fraud or where force ceased to operate is not excluded. The section also applies to suits based upon documents – where the same are concealed. It has application with respect to execution petitions also.

 

S.18 – 20 are related to acknowledgements – which forms part of larger doctrine of Admissions (S.21 of IEA) these provisions provide for a fresh/renewed period of limitation on each admission/acknowledgment of liability, for each admission (self harming and hence carrying with it implicit guarantee of truth) affords proof of existence of jural relationship and of subsisting liability.

 

S.18 - deals with acknowledgments in writing/signed by person under liability or predecessor in title.  It goes on to state that acknowledgment need not be a promise to pay, need not to be express or in as many words, but if the jural relationship is capable of being derived by implication (necessary) then the same would amount to an admission.

 

S.19 - deals with acknowledgments evidenced in payments towards debts or interests on legacy, but they should also be recorded in writing/signed.

 

Cheques as long as they are not encashed do not fall within the purview of S.19. The same applies to a dishonoured cheques as well. However this may expose people to fraud, as a creditor may on the assurance of a cheque issued to him, forbear to sue and in the process period of limitation may run out, and if that cheque bounces – is he left with no remedy ? Well not in S.19 – however the courts have held it to be documented acknowledgement, duly signed hence satisfying the elements of S.18.

 

S.20 - is in a sense supplementary to aforesaid Ss.18/19 insofar as it defines as to who are persons who are duly authorised to make admissions on behalf of a person.

 

Courts have interpreted these liberal provisions relating to admissions liberally so as to extend their beneficial scope. Statements capable of two views – have been held to be admissions so as to protect the right from turning imperfect.  

 

S.21 - talks about period of limitations vis-à-vis parties added or substituted in a suit. The problem that arises here is the suit or the Cause of Action may be barred with respect to them when they are sought to be joined (O.1 R 10), and as on expiry of limitation against them a valuable right viz. not to face any action accrues to them, they are taken to have been made parties on the date of impleadment i.e date of application of impleadment, if allowed. However this may result into injustice sometimes – which is just what the proviso seeks to counter. The proviso provides for a relating back effect, a legal fiction in case court is satisfied that such party could not be joined due to mistake in good faith. It may deem such parties to have been joined in the first instance, so as to circumvent the bar of limitation in cases which demand such judicious indulgence.

 

S,22 - contain the principle of de, die et diem – that is day to day – in a continuing cause of action period of limitation is renewed each moment as long as the wrong continues. For eg : trespass, nuisance, defamation etc.

 

S.27 – the only exception to the general effect of the act in barring only the remedy and not the right. This section, in cases of recovery of possession, if an action is not brought within the period stipulated – destroys the very right. Also known as the doctrine of adverse possession – if use of property/its care or attempt to regain is foregone for a period – and an adverse title being established is not opposed to through the instrumentality of law or otherwise. The other person does acquire a valid title. This is baffling for a reasonable man, how does some years of illegality turn into a legality. This concept of adverse possession is affront to the notions of justice and equity and run counter to modern ideas of propriety rights. The Supreme Court has gone to the extent of saying that – adverse possession is an area where justice and law do not happily co-incide. Keeping in mind this observation and the inherent unjust nature of this principle, courts have been consistently insisting on a very rigid satisfaction of conditions – only after which adverse possession ripes into title. These conditions have to be specifically claimed and proved. 

Courtesy_

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