§ Order XXXVII Rule 1(2), CPC 1908

This Order applies to the following classes of suits, namely —

(a) suits upon bills of exchange, hundis and promissory notes;

(b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising — (i) on a written contract; or (ii) on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or (iii) on a guarantee, where the claim against the principal is in respect of a debt or liquidated demand only.

§ Two conditions, and what they exclude

• A written foundation. A negotiable instrument, a written contract, an enactment or a guarantee. An oral contract is outside the Order however clear the evidence, because the premise of the procedure is a written record that speaks for itself.

• A liquidated demand. A fixed sum, or one ascertainable by calculation. A claim for unliquidated damages, for possession, for an injunction or for a declaration cannot be brought under the Order.

• And the plaint must say so. Rule 2(1) requires a specific averment that the suit is filed under Order XXXVII, that no relief outside the rule is claimed, and the prescribed inscription below the number of the suit.

Which claims

Any claim cognisable by a civil court

Only the classes in Rule 1(2), and only for a debt or liquidated demand

The plaint

Order VII Rule 1

In addition: the averment that it is under Order XXXVII, that no relief outside the rule is claimed, and the prescribed inscription

On service

The defendant appears and files a written statement

He must ENTER AN APPEARANCE within ten days of service

Failure to appear

The suit proceeds EX PARTE, and the plaintiff must still prove his case

Rule 2(3): the allegations in the plaint are DEEMED ADMITTED and the plaintiff is entitled to a decree

The right to defend

As of right: he files a written statement and contests

None as of right; he must apply for LEAVE within ten days of the summons for judgment, on an affidavit disclosing facts

The court's response

Not applicable

Unconditional leave, conditional leave, or refusal, according to the quality of the defence disclosed

Where leave is granted

Not applicable

Rule 7: the procedure is the same as in an ordinary suit from that point

Setting aside a decree

Order IX Rule 13: on SUFFICIENT CAUSE for non-appearance

Rule 4: only under SPECIAL CIRCUMSTANCES, a stricter standard

Object

To decide a contested claim on its merits

To deny delay to a defendant who has no real defence, while leaving him able to obtain a trial if he shows he needs one

§ The proviso to Order XXXVII Rule 3(5)

Leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defence to raise, or that the defence intended to be put up is frivolous or vexatious.

The proviso is what keeps the procedure fair. Refusal is not the default; the court must be positively satisfied that the defence is insubstantial or frivolous before shutting the defendant out.

And it fixes the standard. The question is not whether the defence will succeed, but whether it is substantial, that is, whether it raises something that ought to be tried.

§ What the court may do

• Unconditional leave, where the affidavit discloses facts amounting to a substantial defence or raising a triable issue on the merits. The suit then proceeds as an ordinary suit.

• Conditional leave, where the defence is plausible but improbable, or raises doubts about the defendant's good faith: ordinarily on a deposit of the whole or part of the claim, or security. A condition so onerous that it amounts to a refusal defeats the proviso.

• Refusal, where the defence is frivolous, vexatious or a sham, disclosing no substantial defence at all.

• And a fourth case: under Rule 3(6)(b), where the defendant admits part of the claim, leave may be granted only on his depositing the admitted sum in court.

Where it applies

Any civil court, for the classes in Rule 1(2)

Commercial disputes of a Specified Value before a Commercial Court or Division

Who initiates

The plaintiff, by instituting the suit in that form

Either the plaintiff or the defendant, by application

When

At institution: the whole suit is in that form from the outset

After service and before issues are framed

The test

Whether the defendant discloses a substantial defence or a triable issue

Whether the party has no real prospect of succeeding, and there is no other compelling reason for a trial

Relief

A decree where leave is refused or not sought

Judgment on the claim or on a particular issue, or a conditional order

Overlap

Order XIII-A Rule 1(2): summary judgment does not apply to a suit originally filed as a summary suit under Order XXXVII