Amulakchand Mewaram v Babulal Kanalal Taliwala (1933)

Every question on amendment of pleadings eventually reaches the objection that the amendment sought is not really an amendment at all, because it brings a new party on the record. This is the case that supplies the test for telling the two apart, and it does so in a single sentence that later courts, including the Supreme Court, have adopted verbatim: the question turns on whether the name in which the suit is brought is the name of a non-existent person, or is merely a misdescription of existing persons.

The consequences are asymmetrical and severe. If the plaintiff named never existed, the suit is a nullity and nothing can save it. If real people were merely described by the wrong label, the court should ordinarily let them correct it, because nothing is being added to the suit except accuracy.

The suit was commenced in 1926. The plaintiffs were described as "Amulakchand Mewaram, a firm of merchants carrying on business at Kalbadevi Road outside the Fort of Bombay". It was appreciated very early that this was not in fact a partnership firm at all, but the name of a joint Hindu family, of which, on the evidence, there were three members.

It was therefore proposed in 1926 that the plaint be amended by substituting the names of the three members of the joint family for the name of the family firm. The defendant was prepared to agree, and the terms of a consent order were actually settled, but the defendant claimed the costs of amending his written statement. Beaumont C.J. thought that contention well founded; the plaintiffs objected to it, and in consequence the amendment was never carried through.

The suit accordingly came on for trial in 1932, and only at the hearing did the plaintiffs renew their request to substitute the names of the members of the joint family. That amendment was now clearly necessary if the suit was to proceed at all, because a joint Hindu family is not a firm in whose name proceedings may be commenced under Order XXX Rule 1, "that rule being confined to firms of merchants carrying on business in British India".

Mirza J refused leave to amend and dismissed the suit. The plaintiffs appealed.

The whole of the law for which this case is cited lies in three sentences of Beaumont C.J.

"It seems to me that the question whether there should be an amendment or not really turns upon whether the name in which the suit is brought is the name of a non-existent person, or whether it is merely a misdescription of existing persons."

"If the former is the case, the suit is a nullity and no amendment can cure it."

"If the latter is the case, prima facie there ought to be an amendment because the general rule, subject no doubt to certain exceptions, is that the Court should always allow an amendment where any loss to the opposing party can be compensated for by costs."

Note the shape of the third sentence. It is not merely permissive: it puts the burden the other way round. Once the case is one of misdescription, an amendment ought prima facie to follow, and the compensating instrument is an order for costs.

The reasoning is worth following, because it is the answer to the limitation objection that usually accompanies such an application. Where a suit is brought in the name of a trading style, and it is proved that the style is the name of an existing firm or family consisting of certain individuals, then that description does no more than cloak the identity of those individuals, who are already before the court under that name. If the rules do not permit them to sue in that style, then for the purposes of the suit the description is incorrect and must be altered. But in such a case, in the words of the judgment, the proposed alteration "does not involve introducing new plaintiffs" — it merely describes correctly, rather than incorrectly, the plaintiffs already before the court.

Beaumont C.J. treated this as the basis of the earlier decision in Ramprasad v Shrinivas, and declined to follow the contrary view taken in Vyankatesh Oil Mill v Velmahomed, observing that the learned Judge there had held the plaintiff firm to be a non-existent entity and yet had gone on to give leave to amend, which seemed inconsistent with that finding.

He also rejected the argument that Order XXX had altered the position. Order XXX authorises a suit in a firm name in a certain class of case, and it may be that inferentially it forbids it in any other class of case; but it cannot affect the anterior question of fact whether a suit brought in a firm name outside Order XXX is a case of misdescription of existing persons or a suit by a non-existent entity. "That question, as I say, is one of fact", and in this case the evidence proved that the firm name did describe certain existing persons.

Leave to amend ought to have been given, but the plaintiffs did not escape the consequences of having sat on the point for six years. Because of what the Chief Justice called "the very foolish conduct of the plaintiffs in not carrying the amendment through in 1926 and waiting up to the hearing", leave was granted only on drastic terms as to costs: the plaintiffs were to pay the costs up to and including the hearing, their own costs of the necessary amendment of the plaint, and the defendant's costs of any supplemental written statement.

On the costs of the appeal itself, the Court declined to read the earlier authority relied on as laying down any general rule that a successful appellant against a refusal of leave must go without his costs. "Costs are always in the discretion of the Court, and peculiarly so where the payment of costs is imposed as a term of amendment". Here, since the plaintiffs' own conduct had made the appeal necessary, each party was left to bear his own costs of the appeal.

"On these terms we allow the amendment asked for by the plaintiffs and set aside the order dismissing the suit."

The test is factual, not formal. Candidates argue from the label: it was sued as a firm, and a joint family is not a firm, therefore the suit is bad. That is exactly the step the Chief Justice refused to take. Order XXX may deny the family the right to use the style, but whether real persons stand behind the style is a matter of evidence, and here the evidence showed that they did. The suit was not a nullity; only its heading was wrong.