Two years back a member of our co-operative housing society was using his ground floor flat for storing goods and for garment making. All flats in our Society including the member’s flat are purely residential flats. At the time of his admission as a member, he had given an undertaking that he would not effect any change of user without the permission of the Managing Committee. He had neither sought nor had the MC given him any permission.
The Society sent him several notices asking him to stop misuse of the flat. But he ignored all of them. Then the Managing Committee filed a case against him in the Co-operative Court. The Opponent came to the Court and admitted that what he was doing was wrong and bad in law and asked for time to discontinue the misuse. The Society agreed provided that he gives a written undertaking before the court. Subsequently joint Consent Terms were made by the member and the Society and submitted to the Court. Under the Terms, the member admitted that what he was doing was bad in law and that he would revert to the user of the flat as residence on or before 31st March, 2010. The Court gave the same Consent Terms as an award under the seal of the court.
In June, 2010 the member wrote a letter to the Society saying that he had complied with court order. He had also actually vacated the flat. After some days, he asked the Secretary, among other things, copies of the bonds executed by the Managing Committee. The Secretary came to me asked me what were the bonds. When I looked into the Maharashtra Co-operative Societies Act, 1960, I found that the MC members had to execute bonds within 15 days of their assuming office. Otherwise they wou;d be deemed to have vacated the posts.
The Secretary asked our lawyer whether it would affect the court order received in our favor. The lawyer said that not signing the bonds would have no effect on the court order and only that either we would have to hold new elections or execute the bonds then with the permission of the Registrar. Also I posed the same question before this Forum and the learned members were of the opinion that actions taken by the MC will be protected under Section 77 of the Act. Thereafter the MC Members executed the bonds.
After a month or so, the member resumed using the flat for commercial purposes. He also wrote to the Registrar giving among many complaints against the MC Members, a complaint that the MC members had not executed the bonds and hence the court order on him was no more valid. The Secretary wrote in his reply to Registrar that the Society’s actions against the member were protected under Section 77 of the Act and that they had executed the bonds since.
As the member continued the misuse, the Secretary sought the advice of the lawyer. The lawyer advised the Secretary to register a complaint with the police. When the Secretary told the police the inspector told him that they could not take any action as it was a civil case.
Then the Society’s lawyer said that he would send a notice and gave a draft of the notice to the Secretary. In the draft the lawyer had written that in the event of his failure to restore residential use of the flat, an extra-ordinary general meeting would be called to recommend his expulsion from the membership of the Society. When the Secretary showed me the draft I did not agree with it for the following reason:
(1) The Society would be forgoing all the advantage it had on account of a court order in favor of the Society and the Society would be back to square one.
(2) Even ordinarily many members do not attend the meetings and we do not even get a quorum. In this case members would be even more reluctant because of the unpleasant agenda. On the other hand the recalcitrant member would bring his own members who would vote against his expulsion.
(3) The most critical of the reasons is that the resolution should be passed with a ¾ majority under Section 35 of the Act.
(4) Even if the Society somehow gets the resolution adopted, it would still have to get the approval of the Registrar and the case could further go to court also
I drastically altered the draft stating only that the Society would take legal action to enforce his compliance with his own undertaking before the court. When the Secretary took the altered draft to the lawyer he did not agree at all in the beginning. Later he reluctantly agreed only after much argument. The lawyer notice was issued and predictably the member ignored the same.
Now the Society has to take legal action. Once when the Secretary asked the lawyer whether the Society can file a contempt of court petition, the lawyer told him that, it would be difficult as contempt of court complaint would have to be filed in the High Court.
The lawyer proposed that we would again file case before the same Co-operative Court. He prepared the draft and handed over to the Secretary. It was again a toothless draft. It was almost a repetition of what was filed in 2010, except that it made a reference to the Consent Terms executed by the Opponent in 2010. Earlier orally he had told the Secretary that the Society would pray for order for his eviction. But there was no mention of it in the draft. I thought that the petition would pray for order for enforcement of the Consent Terms of 2010. But there was no mention of that in the draft. According to me there are three options available to the Society.
1. Contempt of Court
2. Apply to the Co-operative Court praying for enforcement of its 2010 award.
3. File afresh as a dispute, almost a repetition of what was done 2010, except that refer also to the case of 2010 and the award thereupon.
My opinion on each of the options is as follow:
1. Contempt of Court
a. The action of the member amounts to civil contempt as per Section 2(b) of the Contempt of Court Act, 1971.
b. However the petition will have to be made to the High Court and, in this case, Government of Maharashtra shall also be a respondent.
c. But according to Rule 17(b) of the Rules under Contempt of Court Act, 1971, for civil contempt the Subordinate Court should make the Petition or Reference to the High Court following procedure laid down under Rule 6 as far as possible.
d. Under Rule 6 the Subordinate Court shall make the Reference either suo moto or an application received by it. As such the Society can make application to the Co-operative Court.
e. Before making the preliminary enquiry, the Subordinate Court is required to issue a show cause notice along with copies of relevant documents to the Contemnor and hear him. Thereafter if the court feels justified shall refer the matter to High Court
If the errant member receives notice from the Co-operative Court, that itself may be sufficient to make him behave properly, because if he doesn’t, the punishment can be up to a maximum of 6 months in prison, a civil prison notwithstanding.
2. Enforcement of the 2010 Award of the Co-operative Court.
This can be done. But the Opponent may contest and try to prolong the case with adjournments and frivolous arguments and merrily continue his business. The Society can pray to the court for an interim injunction. But whether the court will accept the prayer and if so, how much many adjournments and time it would take, is not known.
3. File a fresh suit
The Society may lose the advantage of the 2010 Award. Otherwise it will be similar to 2.
The Contempt of Court action and one of the 2nd or 3rd option can also be chosen simultaneously or one after the other.
I would like to get the valuable advice/comments of the learned members.