Explain the term ‘Necessary Party’.

Question: Explain the term ‘Necessary Party’. [J.S. 1984]

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Answer

In civil litigation, the objective is to obtain a complete and effective adjudication of the dispute between the parties involved. To achieve this goal, it is crucial to identify and include all necessary parties in the lawsuit. This ensures that the court's judgment or decree is binding on all individuals or entities who have an interest in the subject matter of the litigation.

The Code of Civil Procedure in many jurisdictions provides guidance on determining who qualifies as a necessary party. Specifically, Order 1, Rule 10 of the Code of Civil Procedure addresses the inclusion of necessary parties.

According to Rule 10, a person is considered a necessary party if their presence is necessary for the complete and effective adjudication of the dispute or if their absence would risk multiple or inconsistent judgments. Let's explore each of these aspects further:

a. Presence necessary for complete and effective adjudication:

When determining whether a party is necessary for the complete and effective adjudication of the dispute, the court examines whether their involvement is essential to enable a comprehensive resolution of all the issues involved. In other words, the court assesses whether the absence of that party would hinder a just and complete determination of the matter at hand.

For example, in a property dispute between two co-owners, if one co-owner files a lawsuit against a third party claiming ownership, the other co-owner is a necessary party. Their presence is crucial because their rights and interests are directly affected by the outcome of the case. Without including the co-owner as a party, the court's decision would be incomplete and would not adequately address the rights and claims of all interested parties.

b. Risk of multiple or inconsistent judgments:

The second aspect of determining a necessary party relates to the risk of multiple or inconsistent judgments. If a person with an interest in the subject matter of the litigation is not made a party to the lawsuit, there is a possibility that separate lawsuits may be filed, resulting in conflicting judgments.

For instance, in a dispute involving a contract between two parties, if the contract itself involves the rights or liabilities of a third party, that third party may be considered a necessary party. Failure to include them in the lawsuit could lead to a situation where the court's decision binds only the parties to the lawsuit but does not resolve the issue comprehensively, potentially leading to contradictory judgments in different proceedings.

It's important to note that the determination of whether a party is necessary or not depends on the facts and circumstances of each case. Courts analyze various factors such as the nature of the dispute, the interests involved, and the potential impact of the judgment on the absent party.

If a necessary party is not impleaded (included) in the lawsuit, the court has the power to direct their inclusion at any stage of the proceedings. This power is exercised to ensure that all parties with a stake in the matter have an opportunity to present their arguments and evidence and that the court can arrive at a fair and conclusive decision.

In conclusion, a necessary party, as per the provisions of the Code of Civil Procedure, refers to an individual or entity whose presence is essential for the complete and effective adjudication of a dispute or to avoid the risk of multiple or inconsistent judgments. The inclusion of necessary parties ensures that the court's judgment or decree binds all interested parties and leads to a comprehensive resolution of the matter at hand.