Thread by @barandbench

Delhi High Court continues hearing Rajiv Luthra's appeal challenging stay on Mohit Saraf's termination from L&L Partners

Advocate Haripriya Padmanabhan makes arguments for Luthra. Takes Court through 3-4 documents for background of dispute

Padmanabhan cites Section 41 Specific Relief Act, which says that party must act in good faith.

Justice Endlaw contemplates appointing Senior Advocate AS Chandhiok as receiver for Luthra pending appeal.

Chandhiok: I have given all parties suggestions as to how the dispute can be settled finally. I'm waiting to see how it can be taken forward.

Padmanabhan continues. Any Section 9 order passed by Court will have to consider provisions of Specific Relief Act.

Justice Endlaw: In a partnership dispute, there is no specific performance involved. What we have to see is what has to be done in the interim to preserve the rights of the parties.

Padmanabhan continues to apprise the court of the background in which Saraf had filed the section 9 petition before the Single Judge.

What does he mean by there is no right to terminate? Clause 8 says only RKL (Rajiv Luthra) has the right to terminate. There is admission that RKL has the right to terminate: Padmanabhan

He retires me on 12th. I get this letter at 6-6.30 pm. At 10 pm I say I've not retired. Somewhere in this 3-4 hours, he gets the time to (distribute my equity) : Padmanabhan

Padmanabhan continues to read the prayers made in the section 9 plea by Mohit Saraf.

Mr Saraf acted contrary to the deed. He had no right to retire Luthra under the deed. Only RKL can terminate. He sought to distribute Luthra's equity to 23 people: Padmanabhan

The basis of the petition is not let us both continue.. during the course of tbe arguments, it was said that we could work together pending resolution : Padmanabhan

Very drastic orders will be passed by us.. lawyers case is being dealt with as a client's case. This is not taking us anywhere: Court

In a partnership, there is no such thing of 65% and 35%. Both claim to be the backbone: Court

Today Mr Luthra is in : Padmanabhan

So you are saying allow us to run the firm : Court

Yes, we will maintain the accounts: Padmanabhan

If they have to part, it has to be done at the earliest. Either they work as gentelmen or everything comes to a standstill: Court

Firm will suffer.. there many people whose livelihood will suffer : Padmanabhan

What to do.. lock up the office..the system! : Court

There is an application.. he tells the CFO that I have info about insider trading and I will go after you : Padmanabhan

He writes to the whole firm saying that illegalities are being conducted.. : Padmanabhan

That will be the next step.. police will get involved.. Clients will run away : Court

We were running the firm from October.. whatever retainers he wants.. that should continue. Arbitrators are sitting on March 1 : Padmanabhan

It is a three member Tribunal: Padmanabhan

We've been hearing section 9 for three months.. what will happen before th Arbitrator: Court

Both you get bouncers and fight it out : Court (in a lighter vein)

There are barrage of accusations.. : Padmanabhan

Would you like us to hear you further? We are not going go into all this. You have to tell is this is a workable solution: Court

From March 1 you will have another forum. You make day to day compliant there : Court

Padmanabhan says there is an application.

These are additional documents being filed so that the matter does not go through: Senior Adv Parag P Tripathi for Mohit Saraf.

They should finish whatever they have to today: Tripathi

Padmanabhan continues to argue.

Parties cannot work together. Interim relief can't be that parties are put back together: Padmanabhan

We have maintained our accounts under sealed cover : Padmanabhan

A meditation is ongoing : Padmanabhan

We wrote the letter to Saraf asking him to stop writing to the whole firm : Padmanabhan

Saraf has always been Senior Partner. He writes to IT department saying you have to sign me as Senior and Founder Partner : Padmanabhan

One person has to stay and other has to go out. Mr Saraf is anyway out : Padmanabhan

Mr Luthra did not file the section 9. He can't say this is continuing so it has to continue: Padmanabhan

Section 9 is when he is seeking an interim order. There was nothing immediate : Padmanabhan

When the firm started, it started as Mr Luthra's proprietorship. The firm has Mr Luthra's name. The clients were his : Padmanabhan

In the Partnership, greater equity and power is with RKL : Padmanabhan

Prima facie, even as per their own argument, it was Mr Luthra who had the power to terminate. Reality is Mr Luthra is running the firm. No prejudice will be caused if Mr Saraf stays out. Anyway there has to be a split : Padmanabhan

It is in the interest of justice that Mr Luthra stays : Padmanabhan

Mr Singhvi is still on his legs before the Supreme Court. If the court could accommodate us for 15-20 mins tomorrow: Padmanabhan

Court is informed that Senior Adv Abhishek Manu Singhvi would he able to join by 4pm.

Padmanabhan continues to argue.

Padmanabhan takes the court through a communication made by Saraf to a firm employee.

Padmanabhan refers to another communication made by Saraf to the entire firm.

Email speaks of spying on emails, violation of IT law and IPC.

This is the letter in the teeth of January 22 order. It demoralises the staff .. when the meditation is going on : Padmanabhan

This will either force them to leave..that seems to be the final game plan : Padmanabhan

Padmanabhan continues to take the court through communications made by Saraf to the whole firm.

Yes we don't get along. Everyone knows this. But this is the tone of the email in spite of the court order : Padmanabhan

The single judge put the order in abeyance for two days. He issues a newspaper notice..this is contempt..till that date he was still out : Padmanabhan

His conduct makes it very difficult..in meetings accusations are made against the Appellant : Padmanabhan

Parties cannot work together..it is Mr Luthra's sole proprietorship which converted in the law firm. He breached the deed : Padmanabhan

He is not entitled to come back to the firm. In the meantime, if he wants to take the retainers and clients.. we can't control where they will go: Padmanabhan

If Tribunal says we have to get into accounting to see how dissolution has to work, considering Mr Luthra's notice, Mr Luthra is the surviving party and he would continue: Padmanabhan

Even if there is dissolution, I stay : Padmanabhan

Padmanabhan takes the court through the relevant clauses in the deed.

You started with all this : Court

Just closing the loop : Padmanabhan

Alright. Rest in rejoinder: Court

I'm amazed. Matter is being very abley argued. But they begin as section 9 and then hinge on documents that are subsequent to the order: Senior Adv Tripathi

This is a section 37. No effort is made to show a single paragraph.. : Tripathi

How does the impugned order work itself out. You are also complaining. He is also complaining: Court

There is no such argument...that this is perverse: Tripathi

There is no effort made to deal with substance. There is operation. I will deal with it. They have to say the judgement is perverse, please interfere: Tripathi

There is an intra court appeal in a suit.. no effort is made to bring it in the ambit of the power. Section 37 falls for minimum interfere unless provided for in the Act : Tripathi

It is a very narrow review. Window is narrower after Commerical Courts Act. Other than saying that I'm a bad man : Tripathi

Tripathi refers to judgement in Wander vs Antox.

The other judgement is of SPECO : Tripathi

Next is Dedicated Flight Corridor vs CRSC matter: Tripathi

If you miss the narrow window, you come back to Section 34: Tripathi

A very narrow window made narrower by overhaul of Arbitration law and Commerical Courts Act : Tripathi

Here is a situation where on Oct 12, 2020, I accept his desire to go out. I don't terminate him : Tripathi

From December 2019, he was saying we can't seem to get along. In that context, in January 2020 he gives a notice.. that period was extended three times. It was to expire on Oct 31: Tripathi

It was affecting the morale of the firm. I accepted it and relived him. That has to be now decided by the Tribunal: Tripathi

On October 13, they say I am guilty of misconduct. No such allegations before that : Tripathi

I didn't say I'm terminating you.. overnight, I'm guilty of misconduct: Tripathi

The only mistake is I didn't do what was done to me : Tripathi

There are these gentelmen downstairs. Armed men: Tripathi

What is the solution? : Court

Please proceed to Arbitration and maintain the situation that was earlier : Tripathi

I could have come in contempt but I didn't. Single judge has said that you maintain status quo because prima facie the 13/10 communication is flawed : Tripathi

Law is clear. It is a relationship of equals: Tripathi

No partner can expel another: Tripathi

The power has to be expressly conferred and exercised in goof faith : Tripathi

If you violate, your so called termination has to he ignored: Tripathi

The argument is that permit me to take advantage of my own wrong otherwise worse thing will happen: Tripathi

The January notice doens't talk of misconduct: Tripathi

There has to be a 90 days notice. There are no two views on that : Tripathi

Senior Advocate Harish Salve has also joined the proceedings.

Senior Advocate Vikas Singh for Saraf: Termination can only be of deed and not a partner.

Here is a person who flouts the Partnership : Tripathi

Alright, Is there any date? : Court

No, no. Court has to fix : Tripathi

Court master suggests February 22.

Give two more dates : Court

This is becoming a day to day problem. If the court could hear us for 15 mins.. I'm part of the team. My role is limited. I was asked by Mr Luthra to assist : Senior Adv Harish Salve

Once there is this type of bitterness, there is no point. Parting has to be decided. On what terms can they walk away.. the heart of the matter is two people who run a law firm: Salve

Client has the choice to be with which lawyer. That's not a problem. I told Mr Luthra that he has to waive non compete and all : Salve

He has to start on his own and get on. What has to be done with the name, has to he worked on : Salve

Nothing can stop Mr Luthra from saying he's The Mr Luthra. Mr Mohit Saraf is also a top class laywer : Salve

It is toxic for both. Mr Saraf will grow and so will Mr Luthra: Salve

This kind of thing (Saraf writing to the firm) doesn't help but it will happen.. what is the financial settlement can be decided in the Arbitration: Salve

To enable him to get on has to be looked into : Salve

Why don't you call both of them over the weekend and it won't take long : Court

Mr Nigam and Mr Chandhiok have been working : Court

I will request Mr Chandhiok, Mr Nigam, Mr Tripathi and Mr Singh to send me their workable solution: Salve

A solution which is equally unsatisfactory to both : Salve

Definitely on Saturday I will have a conversation with both : Salve

I will thereafter not appear in the case:Salve

We are very hopeful: Court

If we move ahead on Saturday, I will inform.. : Salve

Alright, February 22 then March 5 and 12 : Court

Hearing adjourned.