Compromise by authorised counsel satisfies procedural requirements and supports a valid, binding, executable decree

The 1976 amendment to Order XXIII Rule 3 of the Code of Civil Procedure was read as preventing oral compromises and ensuring certainty, not as removing the traditional authority of a duly authorised pleader. In light of Order III Rule 1, the expression "signed by the parties" was held to include signature by counsel or a recognised agent acting for the party. A compromise decree signed through authorised counsel was therefore valid. Where the decree remained unchallenged and no fraud, misrepresentation, mistake, or lack of authority was shown, it operated as res judicata and could not be impeached in execution.

---

---

Issues: Whether, after the 1976 amendment to Order XXIII Rule 3 of the Code of Civil Procedure, 1908, a compromise signed by counsel for the parties, and not by the parties personally, satisfies the requirement that the compromise be in writing and signed by the parties, and whether such a compromise decree is valid and executable.

Analysis: The amended rule was construed in the setting of the established procedural scheme under Order III Rule 1 of the Code of Civil Procedure, 1908, which recognises appearance and acts in court by a party in person, by a recognised agent, or by a pleader. The Court held that the 1976 amendment was intended to prevent oral compromises and to secure certainty and expedition, not to abrogate the traditional authority of counsel. In the absence of express words withdrawing that authority, the expression "signed by the parties" was held to include signature by a duly authorised pleader or recognised agent acting on behalf of the party. The compromise decree entered into through counsel was therefore valid. Since the decree had remained unchallenged and no fraud, misrepresentation, mistake, or lack of authority was shown, the decree operated as res judicata and the subsequent challenge in execution could not be sustained.

Conclusion: A compromise signed by duly authorised counsel satisfies Order XXIII Rule 3 of the Code of Civil Procedure, 1908, and the resulting compromise decree is valid, binding, and executable.

Ratio Decidendi: In the absence of express statutory exclusion, the words "signed by the parties" in Order XXIII Rule 3 of the Code of Civil Procedure, 1908 include signature by a duly authorised pleader or recognised agent acting for the party.

---