The Settlement Act of 1781: What Parliament Fixed

Three: the provincial judges are protected. The Act declared that no action should lie in the Supreme Court against any judicial officer in the country courts in respect of any judgment or order of his court, nor against any person for any act done in pursuance of such an order, it being considered "reasonable to render the Provincial Magistrates, as well Native as British subjects, more safe in the execution of their office". This is the answer to Dutt v. Hosea and, indirectly, to the Patna case.

Four: personal law is prescribed. Where either party was a Muslim or a Hindu, matters of inheritance and succession to lands, rents and goods, and matters of contract and dealing between party and party, were to be determined by Muslim law for Muslims and Hindu law for Hindus; and where only one of the parties was a Muslim or a Hindu, by the laws and usages of the defendant. In addition, the rights and authorities of fathers and masters of families, as they might have been exercised under Hindu or Muslim law, were preserved to them, and it was provided that no act done in consequence of the rule and law of caste, respecting the members of those families only, should be adjudged a crime "although the same may not be held justifiable by the laws of England". The Supreme Court might also frame process and make rules to accommodate suits against Indians to their religion and manners, subject to the royal approbation, correction or refusal.

This is the answer to the trial of Nandkumar, and it is the first time an Act of Parliament tells a court in India what law to apply to Indians. Note the choice-of-law rule in the second half: where the parties are of different religions, the defendant's law governs. That is a real conflict-of-laws rule, and it is the ancestor of much later Indian doctrine.

Five: the Company's own courts are recognised and given a legislature. This, says Cowell, is perhaps the most important part of the Act and the part that most completely reversed the policy of 1773. Parliament recognised the civil and criminal provincial courts as existing independently of the Supreme Court; recognised the Governor-General and Council, or a committee of them, as the chief appellate court of the country; and vested the Council with power to frame regulations for those provincial courts independently of the Supreme Court.

Section 21 enacted that the Governor-General and Council should lawfully hold all such pleas and appeals from the country or provincial courts in civil causes as it had hitherto held, with the same powers, that it should be deemed in law a Court of Record, and that its judgments should be final and conclusive except upon appeal to His Majesty in civil suits of the value of £5,000 and upwards.

Section 23 enacted that the Governor-General and Council should have power from time to time to frame regulations for the provincial courts and councils, with a proviso that His Majesty in Council might disallow or amend them within two years.

Six: the past is indemnified. With regard to the hostilities between Court and Council, in which, said the Act, "many things have been done not justifiable by the strict rule of the law", the Governor-General and Council, the Advocate-General and all persons acting under their orders were indemnified, discharged and saved harmless from any action, suit or prosecution on account of their disobedience and resistance to the execution of the Court's orders from 1 January 1779 to 1 January 1780.

A worked example

Take each of the seven proceedings and ask what would have happened after 1781.

Kamaluddin and Sarup Chand: revenue matters, now outside the Court. Their remedy is under section 22, before the Governor-General in Council.

Dutt v. Hosea: an action against a judicial officer of a country court for a judgment of his court. Barred expressly.

The Patna case: harder, and the answer is instructive. The acts complained of were done by law officers of a Provincial Council in a matter of inheritance. If characterised as acts of a country court in respect of its orders, the action is barred; if characterised as acts done outside any authority, the bar may not apply. What is certain is that the underlying dispute would now be decided by Muslim law, as the Act directs, and not by any English rule.

Nandkumar: the trial was criminal, and the Act's personal-law provisions do not make forgery non-criminal. What the Act does is protect acts done under the rule and law of caste, and give the Court power to adapt its process. A capital trial of a Brahmin on an English statute would still have been possible, and that is the limit of what 1781 achieved.

Cossijurah: the Government could not now be sued for public acts, and the Zamindar, if the suit were revenue-related, would be outside the Court altogether. The crisis could not recur in the same form.

Distinctions worth having straight

What beginners get wrong

"The Settlement Act abolished the Supreme Court." It did not. The Court continued, with reduced jurisdiction, and Cowell records that it afterwards won greater authority and respect than any earlier tribunal in India.

"It settled the boundary between the two systems." It did not, and the next chapter is about what it left unsettled. It removed the largest sources of friction without ever saying what the relation between the two systems was.

"The £5,000 appeal went to the Privy Council." It went to His Majesty in Council. The Judicial Committee of the Privy Council was created in 1833, and Module II follows that.

"The indemnity means Parliament approved what the Council did." The Act says the opposite in the same breath: it indemnifies because "many things have been done not justifiable by the strict rule of the law". An indemnity is granted for acts that were unlawful; if they had been lawful none would be needed.

Limits and criticism

Two criticisms, and the second is the more important.

It was a settlement in favour of the Company, and it is fair to say so. The Government was made unsuable for public acts, the revenue was removed from independent scrutiny, the Company's own courts and judges were protected, and the Company's officers were indemnified for having disobeyed a court. Every contested point was resolved in the Company's favour, and the substitute remedies were remedies within the Company's own system.

And it repeated the Regulating Act's central failure. Cowell's verdict is exact and worth quoting in substance: in the Act of 1781, as in that of 1773, there is no plain statement of the relation in which the Indian territories stood to the British Crown, nor whether any Indian natives were to be comprehended under the term "subjects", nor whether the provincial courts were to have a concurrent jurisdiction with the Supreme Court or an exclusive one, nor, if the latter, what its limits were.

So the great questions were left open a second time. What 1781 achieved was the removal of the occasions of conflict, not the resolution of it, and the two systems went on side by side for another eighty years until the Indian High Courts Act 1861 merged them. That is Module II.

Quick revision

• 21 Geo. III c. 70, the Act of Settlement, 1781.
• Governor-General and Council exempt for acts in their public capacity.
• Revenue excluded from the Supreme Court; s.22 gives the Council power to punish offences, abuses and extortions in collection, short of death, maiming or perpetual imprisonment.
• No action in the Supreme Court against a judicial officer of a country court for his judgments or orders, nor against a person acting in pursuance of them.
• Hindu and Muslim law in inheritance and succession and in contract and dealing; where the parties differ, the defendant's law. Acts under the rule and law of caste not to be crimes though not justifiable by English law.
• s.21: the Governor-General and Council recognised as the chief appellate court; the Sadar Diwani Adalat a court of record; final except on appeal to His Majesty in civil suits of £5,000 and upwards (and see s.71).
• s.23: power to frame regulations for the provincial courts without registration in the Supreme Court; the Crown may disallow within two years.
• Indemnity for resistance to the Court's process from 1 January 1779 to 1 January 1780, the Act reciting that many things had been done not justifiable by the strict rule of the law.

Test yourself

1. Name four things the Settlement Act took out of the Supreme Court's reach. Acts of the Governor-General and Council done in their public capacity; matters concerning the revenue and the officers employed in its collection; actions against judicial officers of the country courts in respect of their judgments and orders; and, by prescribing Hindu and Muslim law, the application of English law to inheritance, succession and contract between Indians.

2. State the choice-of-law rule the Act laid down. That in matters of inheritance and succession and of contract and dealing between party and party, Muslims were to be governed by Muslim law and Hindus by Hindu law; and where only one of the parties was a Muslim or a Hindu, by the laws and usages of the defendant.

3. What did section 21 do for the Sadar Diwani Adalat? It recognised the Governor-General and Council, or a committee of them, as determining appeals from the country and provincial courts, declared that body a court of record, and made its judgments final and conclusive except on appeal to His Majesty in civil suits of £5,000 and upwards.

4. Why did section 23 matter so much in practice? Because under section 36 of the Regulating Act a regulation was void until registered in the Supreme Court, and the Regulations of 1780 had never been registered. Section 23 allowed the Governor-General in Council to frame regulations for the provincial courts without reference to the Supreme Court, subject only to disallowance by the Crown within two years.

5. What does the indemnity clause tell you about Parliament's view of the Council's conduct? That it was unlawful. The Act indemnifies precisely because, in its own words, many things had been done that were not justifiable by the strict rule of the law; an indemnity is unnecessary for lawful acts.

6. What did the Act fail to settle? The same questions the Regulating Act had left open: the relation of the Indian territories to the Crown, whether Indians were comprehended in the word "subjects", and whether the provincial courts had a jurisdiction concurrent with the Supreme Court's or exclusive of it, and if exclusive, within what limits.