Your Q, His A

Section 28 of the Indian Contract Act, 1872 deals with agreements which wholly or partially prohibit parties from having recourse to a court of law. In terms of the said Section, every agreement by which any party thereto is restricted from enforcing his rights under or in respect of any contract, by usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights is void to that extent. Thus, under the provisions of this Section, an agreement, which in effect seeks to curtail the period of limitation and prescribes a shorter period than that prescribed by law, would be void as offending this Section 28. But arrangements, which do not seek to curtail the time for enforcement of the right but which provide for forfeiture or waiver of the right itself if no action is commenced within the period stipulated by the agreement would not fall within the mischief of Section 28 of the Contract Act and can be enforced.

• If a court outside India passes a judgment, would such judgment be valid and enforceable here?
— S.L. Pandya

To be considered valid in India, a foreign decree needs to pass the test of Section 13 of the Code of Civil Procedure, 1908 (‘‘Code’’), which provides the grounds which render the foreign decrees inconclusive between parties in India. As per the said Section, a foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title, except where the judgement is: (i) not pronounced by a court of competent jurisdiction; (ii) not pronounced on the merits of the case; (iii) based on an incorrect view of international law or wherever applicable, do not recognise the law of India in cases in which such law is applicable; (iv) pronounced in violation of natural justice; (v) obtained by fraud; or (vi) where the claim is founded on a breach of any law in force in India, etc.

• How can a family arrangement be made valid and binding on the parties? Would it require registration?
— T. Bijlani

To give a binding effect on an agreement between members of a family, it is essential that the family arrangement be a bona fide settlement so as to resolve a fair and equitable division between the parties. It must be voluntary and not induced by fraud, coercion or undue influence. If bona fide disputes, present or possible, which may not involve legal claims, are settled by a bona fide family arrangement which is fair and equitable the family arrangement is final and binding between the parties to the settlement. The members who may be parties to the family arrangement must have some antecedent title, claim or interest in the property, which is acknowledged by the parties to the settlement.

Family arrangement as such can be arrived at orally, in which case no registration would be required. Alternatively, its terms may be recorded in writing as a memorandum of what has already been agreed between the parties. The memorandum is usually prepared as a record of what has been agreed upon so that there are no hazy notions about it in future. It is only when the parties reduce the family arrangement in writing, and which family arrangement in itself creates or extinguishes any rights in immovable properties, that the memorandum is required to be registered compulsorily.