Order 14 CPC | Court Cannot Grant Relief On Issue Not Settled Or Tried Between Defendants: Kerala High Court

"The liability inter se between defendants 1 and 2 was not raised as an issue nor was it tried. Therefore, the appellant is justified in their contention that the decree permitting the 1st defendant to have the decree amount reimbursed from the 2nd defendant is unjustified." Kerala High Court, in a significant ruling dated October 7, 2026, held that a trial court cannot grant a decree for reimbursement between co-defendants if the inter se liability was never framed as an issue or subjected to trial.

A division bench comprising Justice Sathish Ninan and Justice P. Krishna Kumar observed that granting such relief without adjudication violates the fundamental principles of fair trial and the requirements under Order XIV of the CPC.

Lack of Procedural Fairness

The case involved a money suit where the plaintiff, an electrical contractor, sought payment for work performed under a subcontract with the 1st defendant, who was the lead contractor for the Greater Cochin Development Authority (GCDA). While the trial court decreed the suit in favor of the plaintiff, it concurrently ordered that the GCDA (the 2nd defendant) must reimburse the 1st defendant for the amount paid to the plaintiff. The GCDA challenged this, arguing that it was not a party to the subcontract and that its rights and liabilities vis-à-vis the 1st defendant were never adjudicated.

Need for Framing Issues

The primary question before the court was whether a trial court is empowered to adjudicate and pass decrees on liabilities between co-defendants when no such issue was settled during the trial. The court emphasized that the principles of natural justice require that parties be put on notice regarding the specific liabilities they are being asked to answer. Failing to settle such an issue at the trial stage prevents the concerned party from leading evidence to rebut such claims.

Court Explains Limitation of Trial Court

The High Court noted that the trial court’s direction for reimbursement was issued without any trial on the merits of the relationship between the two defendants. Because the GCDA was denied the opportunity to contest the existence of any obligation to reimburse the 1st defendant, the decree, to that specific extent, was held to be unsustainable in law.

"The liability inter se between defendants 1 and 2 was not raised as an issue nor was it tried."

Limited Remand Order

Observing that the 1st defendant had already satisfied the decree in favor of the plaintiff, the court determined that there was no need to reopen the entire suit. Instead, the bench set aside the portion of the decree pertaining to the reimbursement and remanded the matter to the trial court for a restricted inquiry. The lower court has been directed to frame a specific issue regarding the inter se liability between the 1st and 2nd defendants and dispose of that aspect in accordance with the law.

The court allowed the appeal in part and directed the parties to appear before the trial court on October 23, 2026. Recognizing the procedural oversight in the trial court's original judgment, the High Court further ordered that the court fees paid on the memorandum of appeal be refunded to the appellant, the GCDA.

Date of Decision: 07 October 2026