Case Note & Summary
The dispute arose from a suit for declaration and mandatory injunction where the appellants, having lost at the trial and appellate levels, filed a second appeal before the High Court of Kerala. An interim stay was granted, and the case was referred to the Lok Adalat, where a tentative settlement was reached on 25.5.2007. However, the appellants claimed that the settlement could not be finalized due to access issues, leading to no formal compromise being filed. The High Court later referred the matter back to the Lok Adalat, which reported a failure to settle on 3.4.2008. When the appeal was heard on 19.8.2008, the appellants' counsel was absent due to illness, and the appeal was dismissed for default. An application for restoration was subsequently filed but was dismissed on 29.8.2008, citing the prior settlement. The Supreme Court found that the Lok Adalat had acted beyond its authority by issuing an award without a final settlement, and the High Court's dismissal was influenced by this erroneous award. The Court emphasized the need for Lok Adalats to adhere strictly to their conciliatory role and not to impose judicial determinations. The Supreme Court restored the second appeal for a merits-based hearing, underscoring the importance of judicial impartiality and the right to a fair hearing. The Chief Justice was requested to assign the case to a different judge to avoid any perceived bias.
Headnote
A) Alternative Dispute Resolution - Role of Lok Adalat - Nature of Settlement - Legal Services Authorities Act, 1987, Section 20 - Lok Adalat's function is to facilitate conciliation and not to adjudicate. The court held that the Lok Adalat's award was erroneous as it was based on a tentative settlement, not a final agreement, thus the appeal dismissal was improper (Paras 7-16).
Issue of Consideration
Whether the High Court erred in dismissing the second appeal based on the conduct of the parties before the Lok Adalat and the nature of the settlement reached.
Final Decision
The Supreme Court allowed the appeals, set aside the High Court's orders, and restored the second appeal for disposal on merits, requesting reassignment to a different judge.
Law Points
- Lok Adalat
- Alternative Dispute Resolution
- Legal Services Authorities Act
- 1987
- Section 20(5)
- Code of Civil Procedure
- 1908
- Section 89
- judicial integrity
- settlement process
- prejudice in decision making
