Res Judicata and why it cannot be a preliminary issue.

In Sathyanath & Anr. Vs. Sarojamani 2022 INSC 529, a two-judge bench comprising Justice Hemant Gupta and Justice V. Ramasubramanian ruled that when the issue involves a mixed question of law and fact, Res Judicata cannot be addressed as a preliminary issue.

An appeal was filed by the plaintiff before the Apex Court, dissatisfied with the High Court ruling directing that Res Judicata can be examined as a preliminary issue.

Originally, the defendant had submitted an application before the Trial Court, invoking Order XIV Rule 2(2) of the Code of Civil Procedure, 1908 requesting Res Judicata and Estoppel be treated as preliminary issues.

The trial court rejected this application, leading the defendant to seek relief from the High Court under Article 227 of the Constitution. The High Court ordered the Trial Court to address Res Judicata and Estoppel as preliminary issues.

Order XIV Rule 2 of the CPC provides:

1. The Court must decide all issues – even if a case can be disposed of on a preliminary issue, the Court should give judgment on all matters, subject to sub-rule (2).

2. The Court may decide an issue of law first – if an issue pertains to the court’s jurisdiction or any legal bar to the suit, the Court may address that issue first and defer other issues.

The bench clarified that preliminary issues are those that do not require evidence. They can be resolved through the application of legal principles or a simple reading of the complaint, particularly when it concerns jurisdiction or a legal barrier to the suit.

The appellant’s counsel drew upon the ruling in Ramesh B. Desai & Ors. v. Bipin Vadilal Mehta & Ors., ?MANU/SC/2996/2006 stating that not every legal issue can be dealt with as a preliminary issue. Only issues falling under Order XIV Rule 2(2), specifically relating to jurisdiction or a legal bar, qualify as preliminary issues.

Further, in Major S.S. Khanna v. Brig. F.J. Dillon MANU/SC/0020/1963, the Court scrutinized Order XIV Rule 2 and held that mixed issues of law and fact should not be treated as preliminary issues, as this could lead to a fragmented and unfair trial process.

The bench reiterated that Order XIV Rule 2 must be read alongside Order XII Rule 5, emphasizing that courts are expected to address all issues collectively unless jurisdictional concerns arise. The goal is to prevent piecemeal litigation, extended trials, and the potential for remand if the appellate court disagrees with a trial court’s decision on preliminary issues.

In conclusion, the Supreme Court set aside the High Court’s order directing the trial court to treat Res Judicata as a preliminary issue, reaffirming the need to consider all issues together.

#Litigation #SupremeCourt #ResJudicata #CPC