20th Dec 2013
Charity proceedings brought to determine issues in relation to the control of two gurdwaras, and which were pending before the Supreme Court, had not been compromised. Although a meeting had taken place between the parties with a view to compromising their differences, no binding agreement had been reached.
The defendants (K) in the main charity proceedings claimed that those proceedings, which were pending before the Supreme Court, had been compromised.
The claimants (S) had brought the charity proceedings to determine who was entitled to control two charities whose assets included two gurdwaras. It was S's case that the ninth claimant (X) was so entitled. X claimed to be the true successor of the First Holy Saint said to have founded the gurdwaras. K applied for the claim to be struck out, but their application was refused. On appeal, the Court of Appeal in Khaira v Shergill  EWCA Civ 983,  P.T.S.R. 1697 held that the case raised non-justiciable issues concerning religious doctrine and practice and stayed the proceedings. An order for costs was made against S. The Supreme Court later granted S permission to appeal on the justiciability issue, which had the effect of staying the costs order pending the appeal. The parties then entered into discussions with a view to compromising their differences. A meeting was held, attended by both sides, as well as representatives from a third gurdwara. X did not attend as he was in India, but the first claimant (S1) held a power of attorney for X and had authority to speak on his behalf. S1 stated that he would not act under his power of attorney without express instructions from X and that anything agreed at the meeting would have to be conditional on X's approval. The Presidents of the three gurdwaras left the main meeting to see if they could come up with a resolution. When they returned, it was announced that the appeal was to be withdrawn. No explanation of what transpired at the Presidents' meeting was given.
It was K's case that a compromise agreement was reached under which S agreed to withdraw their appeal to the Supreme Court and K agreed not to enforce the costs order in their favour.
No binding agreement was reached, whether during the Presidents' meeting or following that meeting. All present were told during the meeting that X's consent was required. Nothing in the establishment of the Presidents' meeting dispensed with the requirement of the consent of all parties to the litigation, including X. The point of X's consent was raised again and confirmed in the Presidents' meeting. The main meeting did not acclaim the announcement unanimously, and the need for X's consent was alluded to. That consent had not been forthcoming. S1 had visited India and it was clear that X was willing in principle to effect a compromise, and draft agreements relating to other proceedings were drawn up apparently recognising the compromise, and the fact that the parties were on visiting terms. However, they were not executed and the drafting had to be regarded as anticipating final agreement, not as, at the draft stage, actually recording agreement. X's lawyers in India also required the compromise of the charity proceedings to be reduced to writing before anything further could be done. The compromise was clearly not seen on X's side as binding without formal written agreement. As no binding compromise was reached, K's claim that the proceedings had been compromised would be dismissed (see para.23 of judgment).