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TMI Blog2017 (4) TMI 536X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt for referring the parties to arbitration before it submits his first statement on the substance of the dispute. We have come to the conclusion that the civil court had no jurisdiction to entertain a suit after an application under Section 8 of the Act is made for arbitration. In such a situation, refusal to refer the dispute to arbitration would amount to failure of justice as also causing irreparable injury to the defendant. As we have already held that the oral agreement as evidenced by the transcript of conversation between the appellant No. 2 and the respondent on 06/07.04.2011 substituting the alleged written agreement dated 06.06.2009 and which contained a clause for arbitration, the same clause for arbitration would also be applicable to the oral agreement. The Division Bench has also erred in law in affirming the order passed by learned single Judge. Both the orders, therefore, cannot be sustained and are set aside and, therefore, in view of the decision in P.R. Shah (supra), there can only be one arbitrator and there can only be a single arbitration. The appeal succeeds and is allowed. However, instead of remitting the matter back to the learned single Judge for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vitiated and had been terminated by mutual consent by both the parties and any proceeding initiated pursuant to the agreement is null, non-est and void and also for recovery of an amount of ₹ 45,50,000/-. e) It is also pertinent to mention here that it was alleged in the plaint that a formal meeting was held between the parties in which it was decided that appellant No.1 will no longer be the contractor and the agreement dated 06.06.2009 would stand terminated by mutual consent and the construction would be carried out by the sub-contractors to be appointed as per the advice of appellant No. 2 who would supervise the same without remuneration/profit. f) The respondent filed I.A. No. 12124 of 2012 in CS(OS) No. 1532 of 2012 under Section 8 of the Arbitration and Conciliation Act, 1996 (in short the Act ) claiming that the subject-matter of dispute in the present suit is already pending adjudication before the Arbitral Tribunal, hence, the suit cannot be proceeded with which was denied by the appellants in their reply to the above said application. g) Vide order dated 17.09.2012, learned single Judge of the High Court, found that the suit is bad for misjoinder of part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cept those which were modified in the oral contract. 8) In support of the above submission, learned senior counsel for the appellants placed reliance upon a judgment of this Court in P.R. Shah, Shares and Stock Brokers Private Limited vs. B.H.H. Securities Private Limited and Others (2012) 1 SCC 594. He has referred to paragraph 19 of the judgment which reads as under:- 19. If A had a claim against B and C, and there was an arbitration agreement between A and B but there was no arbitration agreement between A and C, it might not be possible to have a joint arbitration against B and C. A cannot make a claim against C in an arbitration against B, on the ground that the claim was being made jointly against B and C, as C was not a party to the arbitration agreement. But if A had a claim against B and C and if A had an arbitration agreement with B and A also had a separate arbitration agreement with C, there is no reason why A cannot have a joint arbitration against B and C. Obviously, having an arbitration between A and B and another arbitration between A and C in regard to the same claim would lead to conflicting decisions. In such a case, to deny the benefit of a single arbit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute could be referred for arbitration to an Arbitral Tribunal. 12) Learned counsel, however, submitted that if this Court comes to the conclusion that the matter should be resolved by way of arbitration, the entire matter be referred to the sole arbitrator already appointed by the respondent. Discussion: 13) From the materials on record, it is evident that an agreement dated 06.06.2009 was executed between the parties wherein appellant No. 1 was the contractor and the respondent as a client. The agreement impugned clearly states that there is an arbitration clause therein. Owing to the dispute among parties, the respondent, in exercise of his right under the said clause, appointed a sole arbitrator. Subsequently, notices were issued to the appellant No. 1 and the matter remained pending despite appearance before the Arbitral Tribunal. In the meantime, the appellants jointly filed a suit before the High Court for declarations, permanent injunction and recovery claiming a formal meeting was held between the parties in which it was decided that appellant No.1 will no longer be the contractor and the agreement dated 06.06.2009 would stand terminated by mutual consent and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction that the suit is bad for misjoinder of parties and causes of action and further that the arbitration proceedings initiated by the respondent, in terms of the arbitration clause, is pending adjudication before the Arbitral Tribunal. 15) Admittedly, the cause of action for recovery of ₹ 45 lakhs claimed in the present suit is the expenditure alleged to have been incurred by appellant No. 2 pursuant to the oral agreement he claims he had with the respondent sometime in April, 2011. On the other hand, the cause of action with respect to reliefs of declarations and injunction is the agreement dated 06.06.2009. The alleged agreement dated 06.06.2009 was, admittedly, between the appellant No. 1 and the respondent to which appellant No. 2 was only a witness, which as per the terms of the plaint terminated later on by mutual agreement between the appellant No. 1 and the respondent. At this stage, it was agreed orally that appellant No. 2, who is the husband of appellant No. 1, would take over the execution of the pending works. Admittedly, Appellant No. 1 is not a party to the alleged oral agreement between Appellant No. 2 and the respondent for supervision of the constructio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same suit several causes of action against the same defendant, or the same defendants jointly; and any plaintiffs having causes of action in which they are jointly interested against the same defendant or the same defendants jointly may unite such causes of action in the same suit. (2) Where causes of action are united, the jurisdiction of the Court as regards the suit shall depend on the amount or value of the aggregate subject matters at the date of instituting the suit. Order II Rule 6 Power of Court to order separate trials Where it appears to the court that the joinder of causes of action in one suit may embarrass or delay the trial or is otherwise inconvenient, the Court may order separate trials or make such other order as may be expedient in the interests of justice. In Black's Law Dictionary it has been stated that the expression cause of action is the fact or facts which give a person a right to judicial relief. A cause of action, thus, means every fact, which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is a bundle of facts which taken with the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns involved and has thought or relevant arguments to advance. The only reason which makes it necessary to make a person a party to an action is that he should be bound by the result of the action and the question to be settled, therefore, must be a question in the action which cannot be effectually and completely settled unless he is a party. 22) In view of the foregoing discussion, we are of the opinion that the appellants even though had different causes of action against the respondent but it was a continuity of the agreement dated 06.06.2009 and oral agreement is evidenced by the transcript of conversation between the appellant No. 2 and the respondent on 6/07.04.2011, therefore, both the appellants could have joined as plaintiffs in a suit and the suit is not bad for misjoinder of parties or causes of action. Hence, learned single Judge as also the division bench, was not right in giving an option to the appellants to pursue reliefs qua appellant No. 1 or qua appellant No. 2 only. 23) In the present facts and circumstances of the case, it is also imperative to find out whether the High Court was justified in deciding the maintainability of the suit when an application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , India alone shall have jurisdiction over the subject matter of this AGREEMENT. 25) In Sundaram Finance Limited and Another vs. T. Thankam (2015) 14 SCC 444, this Court has held as under:- 8. Once there is an agreement between the parties to refer the disputes or differences arising out of the agreement to arbitration, and in case either party, ignoring the terms of the agreement, approaches the civil court and the other party, in terms of Section 8 of the Arbitration Act, moves the court for referring the parties to arbitration before the first statement on the substance of the dispute is filed, in view of the peremptory language of Section 8 of the Arbitration Act, it is obligatory for the court to refer the parties to arbitration in terms of the agreement, as held by this Court in P. Anand Gajapathi Raju v. P.V.G. Raju. 26) In P. Anand Gajapathi Raju Others vs. P.V.G. Raju (Dead) and Others (2000) 4 SCC 539, it was held as under:- 5. The conditions which are required to be satisfied under sub-sections (1) and (2) of Section 8 before the court can exercise its powers are: (1) there is an arbitration agreement; (2) a party to the agreement brin ..... 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