This is a revision petition against an order of Mr. Muzaffar Hussain, Additional District Judge, Lahore, dated 5th February, 1979, allowing the respondent's appeal against an order of the trial Court refusing to issue a temporary injunction in his favour.
2. The respondent was admittedly made a member of the petitioner club in the year 1968. He was at that time an Income-tax Officer. Later on, he is said to have been transferred as a Deputy Secretary in the Establishment Division of the Central Government. On the 6th June, 1974, he was suspended from service for a period of three months. At that time, the petitioner Club informed him that he had ceased to be a Member under Article 21 of the Articles of Association. But later on this order was revoked when it was represented to them that the suspension was for a period of three months only. On the 19th December, 1978, it came to the notice of the petitioner that the respondent had been dismissed from service as far back as the 4th September, 1975. He was again intimated about the consequence of this dismissal in so far as the membership of the Club was concerned.
He was also asked to make a submission, if he so liked, on the applicability of Article 21. The respondent, on the 21st December, 1978, informed the petitioner that his appeal against the order of dismissal was pending before the Civil Services Tribunal. The petitioner, however, found themselves unable to help the respondent and informed him on the 31st December, 1978, that They had no option except to consider him to have ceased to be a member the Club.
' The Respondent filed a civil suit to challenge this order. He for a temporary injunction which initially was allowed to him but dated on the 15th January, 1979. His appeal, as stated above, allowed by the learned Additional District Judge.
4. The argument of the learned counsel for the petitioner is based upon Article 21 of the Articles of Association which is as follows :- "Cessation of Membership on Suspension or Dismissal from the Public Service or Conviction :-
(a) Any member, who shall be suspended or dismissed from the Public Service, or be convicted of any offence affecting his honour by a conviction which is not reversed on appeal, shall, ipso facto, cease to be a Member ; provided that his liability to contribute in the event of the winding up of the Association shall continue for one year from the date of his dismissal or suspension or conviction, and that he shall not cease to be liable for any debts due by him to the Association.
(b) In the event of the Member who has been suspended or dismissed from Public Service being reinstated he shall be eligible for reelection as if he were a new candidate, and on reelection shall be excused payment of a fresh Entrance Fee."
' He argued that the question whether the appeal was pending before the Civil Services Tribunal or not, was not relevant since it was open to the respondent by virtue of sub-Article (2) of Article 21 to apply for re-admission as member after he is re-instated, in case his appeal is allowed by the Civil Services Tribunal. He also argued that Article 21 does not leave any discretion with the petitioner and its consequence is that by the dismissal order the respondent ipso facto ceases to be a member of the Club.
5. The learned counsel for the respondent conceded that Article 21 as such does not leave any discretion with the petitioner since a person ceases to be a member of the Club if he is dismissed or suspended from service. He also conceded that his Article operates as a contract between the members and the petitioner Company. But he argued vehemently 1 that it is open to the Court to go into the question of reasonableness or unreasonableness of the Article which appears to be contrary to public policy. He relied upon paragraphs from "The Discipline of Law" by Lord Denning, 1979 Edition, particularly pages 154 to 160.
6. The learned counsel also argued that the word "dismissal" in Article 21 should be interpreted in the sense of a final order of dismissal when order is confirmed in appeal or revision.
7. I have heard the learned counsel at length. I find that the only grounds which have been given by the learned Additional District Judge for holding that the respondent has a prima facie case are as follows :-
(a) He was not given an opportunity of being heard in person.
(b) The impugned order has not yet been implemented.
(c) The respondent had yet to be given an opportunity allegations of mala fides and violation of principles justice.
(d) The dismissal from service has not prima facie attained finality because the matter is sub judice before the Central Services Tribunal.
8. The learned Additional District Judge obviously has not taken into consideration the language of Article 21 of the Articles of Association from which it is clear that the effect of dismissal of a public servant is the immediate cessation of membership of the Club. It says that if a member is dismissed from public service, he shall ipso facto, cease to be a member. There is a proviso that a similar result would follow in the case of conviction of a member for an offence affecting his honour. But this is conditioned by the phrase "which is not reversed on appeal". No such condition is attached to the dismissal from public service of a member. In these circumstances, it cannot be held that dismissal can mean only a dismissal which has been maintained finally in appeal.
9. This interpretation is also supported by sub-clause (b) of the Article which says that a member who has been suspended or dismissed from Public Service shall be eligible for re-election after his re-instatement. This clause, therefore, mates a provision for re-instatement of a person as a result of an appeal or revision before a higher Authority against the order inter alia of dismissal from service. The learned Additional District Judge has acted illegally and with material irregularity in the exercise of his jurisdiction by holding contrary to the provisions fill Article 21 that the dismissal can attain finality for the purpose of this; Article only after an order is passed by the Civil Services Tribunal in appeal.
10. He has also acted illegally and with material irregularity in the exercise of his jurisdiction by holding that the impugned order has not yet been implemented. The question of implementation is not relevant to the wording of Article 21 which says that a person convicted of any offence affecting his honour ipso facto ceases to be a member. This automatic' cessation of membership means that there is nothing to implement once an order of dismissal is passed since the Article does not recognise him as a member of the Club.
11. The learned Additional District Judge has also failed to consider that if the case is covered by Article 21, the question of mala fide will also be of no relevance since if a person ceases to be a member of the Club prima facie, the fact whether a particular communication is mala fide or bona fide will be of no assistance to the respondent. Similarly, the question of opportunity of being heard in person also will not be material since the same result would follow even if a person is heard in person. I, find that the learned Additional District Judge has not taken into consideration the scope of the principle of audi alteram partem. In the resent case the scope of this principle could be extended only to finding whether the respondent had been dismissed or not. Once it was by him that he was dismissed from service, no further protest prove his position vis-a-vis the membership of the Club. The learned Additional District Judge on the question of prima s, therefore, liable to be set aside.
12. This being the most important question, if it is answered in favour of the petitioner, it will not be necessary to go into the further question of balance of convenience or irreparable loss or injury.
From the interpretation of Article 21 referred to above it will be clear that the respondent having ceased to be a member had no right prima facie to claim the membership and as such he cannot be said to have any prima facie case on that score. Even his learned counsel has very rightly conceded that this Article does not leave any discretion to the Association or to the Club and one ceases to be a member on his dismissal from public service.
13. The argument of the learned counsel for the respondent, however, is that it is open to the Court to go into the question of reasonableness or unreasonableness of the Art. Which may now be considered. The learned counsel has relied upon, as stated above, the case of Faramus v. Film Artistes' Association. He has conceded that the judgment of the Court of Appeal reported in 1964 A C 925 is not in his favour but he has relied upon the judgment of the House of Lords which has been referred to from page 157 onwards of "The Discipline of Law" by Lord Denning. But that case is clearly distinguishable. The facts of the case, as given in the book are that "Mr. Faramus was a man of excellent character. He was aged 40. He had been a member of the Film Artistes' Association for eight years. Someone in the Union then got a grudge against him and discovered that, 20 years before, when Faramus was a young man in jesey (during the German occupation), he had been sentenced to six months for getting unemployment pay for his wife. Thereupon the Officers of the Union said that he was not, and never had been, a member of the Union because they had a rule that no one who had been convicted of criminal offence shall be eligible for or retain membership.
Mr. Faramus said that rule was unreasonable and invalid. He claimed a declaration that he was still a member." The learned trial Judge held in his favour but in appeal the Court of Appeal set aside this finding. Lord Denning, a Member of the Court of Appeal dissented. The view of Lord Denning was that this rule being in unreasonable restraint of trade was not reasonable. When the case reached the House of Lords they agreed with Lord Denning that the rule was in unreasonable restraint of trade but held that it had been validated by statute.
14. This case is distinguishable for two reasons. Firstly, it was a case not under the Companies Act and secondly, considering it to be a contract between the member of the Union and the Trade Union itself, it was considered to be void for being in restraint of trade before it was validated by the statute. In the present case there is no such difficulty. The Club is a social type of Association. Its Articles contemplate that no person who has been suspended from any Public Service or dismissed from it shall be eligible for membership of the Association during the continuance of suspension and in case of dismissal until he is reinstated. (Article 9). This provision has been taken to its logical conclusion Article 21 which provides for cessation of the membership of such person in case during continuance of membership he is suspend dismissed from public service. Prima facie, there appears to be unreasonable in this provision. It appears that it is open to the by its Articles of Association to place restrictions on the memo no one can urge that despite these restrictions he should member of the Company since these restrictions appear to him to be unreasonable or as argued by Raja Muhammad Akram they were tortious in character. No doubt if a person has been taken as a Member being qualified to be enrolled a member of the Club, he may be able to make out a case of any action being taken against him to be invalid under any statute law ; as in the case of Faramus it was held that uneligibility was based upon a rule which was made in restraint of trade. Even expulsion may be held illegal in some cases on the same ground but I cannot visualise any such restriction in the present case.
15. Faced with this situation, the learned counsel for the respondent relied upon section 23 of the Contract Act, which provides that where the Court considers the object of a contract to be opposed to public policy, it can strike it down as void. But this argument is not helpful in the present case since there is nothing against public policy if members of Public Service who are dismissed from service are not allowed to be eligible as members or to continue as members of the Club.
There is no right involved in it. On the other hand, it is quite possible that members of the Club may not be willing to associate with a person who has such a cloud on him.
16. The learned counsel for the respondent argued on the basis of Article 17 of the Constitution that this is the policy of law as envisaged in the Constitution that every citizen shall have the right to form associations or unions, subject to, no doubt, any reasonable restrictions imposed by law in the interest of morality or public order. This rule will not be applicable to the present case since it applies to a case where a citizen is barred from forming Association or Union. It is no doubt open to the respondent to form any union which he likes but in the present case the question is whether he can dispute the right of the Club to act in accordance with its Articles of Association and not to recognize the respondent as its member. It is not, therefore, a case where the respondent is debarred from forming any association or union, but is, in fact, a case where he has not been held to be qualified toll remain a member. There is no doubt that it is open to the Companies to lay down qualification for membership. In the present case, not only this qualification has been specifically provided for but there is a further provision that before a person is taken as a member of the Club, he shall have to seek his election by having a proposer and a seconder. His eligibility shall then be considered by the Managing Committee and he shall have to face a ballot before he is enrolled as a member. It cannot be said that the restriction on the powers of the members of that club, to choose person with whom they want to associate, is at all unreasonable.
17. The petition, therefore, succeeds. It is allowed with costs and the order of the learned Additional District Judge is set aside with the suit that the order of the learned trial Court shall hold the field.