Probate jurisdiction limits on restraining third-party company affairs and the need for reasoned ex parte orders

A person bound by an order, though not a party to the testamentary suit, had sufficient legal grievance to challenge it, so the appeals were maintainable. The probate court could not, without first deciding the threshold objection to its inherent jurisdiction, pass interim directions interfering with the annual general meetings and voting or publication processes of separate third-party companies. An ex parte ad interim restraint affecting absent parties also required adequate reasons; here, the absence of reasons and the balance of convenience did not justify the corporate restraint. The interim directions were therefore set aside and the matter remitted for fresh consideration.

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Issues: (i) whether the appellants were persons aggrieved entitled to maintain the appeals; (ii) whether the probate court had inherent jurisdiction to pass directions affecting the annual general meetings and voting/publication of results of third-party companies in a testamentary proceeding; (iii) whether the ex parte ad interim orders were unsustainable for want of reasons and on balance of convenience.

Issue (i): whether the appellants were persons aggrieved entitled to maintain the appeals.

Analysis: The appeals were directed against orders that bound the appellant companies, though they were not parties to the testamentary suit and had not been heard when the orders were passed. A person bound by an order and exposed to consequences for its violation has a sufficient legal grievance to challenge it.

Conclusion: The appellants were persons aggrieved and the appeals were maintainable.

Issue (ii): whether the probate court had inherent jurisdiction to pass directions affecting the annual general meetings and voting/publication of results of third-party companies in a testamentary proceeding.

Analysis: A testamentary court decides the genuineness of the will and may protect the estate, but its power to grant interim relief cannot extend to interference with the internal affairs of companies that are separate juristic entities unless jurisdiction is first established. When a specific objection of inherent lack of jurisdiction is raised, it must be decided at the threshold before coercive directions are issued against non-parties. Interference with a company's AGM in probate proceedings is justified only in an extreme case and after jurisdiction is determined.

Conclusion: The impugned directions were passed without first deciding jurisdiction and were unsustainable.

Issue (iii): whether the ex parte ad interim orders were unsustainable for want of reasons and on balance of convenience.

Analysis: An ex parte ad interim order affecting absent parties should disclose reasons, especially where the order restrains corporate action and operates beyond the suit parties. The order dated 9 August 2019 contained no sufficient reasons, and the restraint on AGM-related action was not justified on convenience when the shares were already under protective control through the administrator pendente lite and the companies had remedies under company law.

Conclusion: The orders were also unsustainable on the ground of absence of reasons and the balance of convenience did not justify the restraint.

Final Conclusion: The appeals succeeded and the interim directions interfering with the companies' AGM processes were set aside, with the matter remitted for fresh consideration by the learned Single Judge uninfluenced by these findings.

Ratio Decidendi: Where a probate court is specifically confronted with an objection that it lacks inherent jurisdiction to restrain the affairs of third-party companies, it must decide that jurisdictional issue first before granting interim injunction-like relief, and an ex parte ad interim order affecting absent parties must record adequate reasons.

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