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Debt Recovery Tribunal The Influencing Factor

What's in a name? This famous quote of William Shakespeare raises a pertinent question, Do names matter? The answer is, To a remarkable degree, they do. Even though we don't choose them, they have an immense and often hidden effect in the decision making affecting our lives. The names are badges bearing information about what the name stands for, be it a name of the individual, institution or organisation or whatever they are. The Romans had the expression Nomen est omen which is Name is Destiny.

The law mimics the human condition in its ambiguities. Great effort has been put forth to project the image of objectivity and a lack of bias in legal decisions. Try, as they may, for better or for worse, humanity cannot extricate itself from its own prejudices and agendas. Thus, legal decision-making is largely biased by factors such as race, the personal interest of judges, and the advancement of government initiatives.

In the American Court, the case of Capertonv, Massey shows this point in a clear fashion. Caperton brought forth a trial against Massey Coal Co. in October of 1998. The presiding justice was Brent Benjamin. The Supreme Court later found that Benjamin had violated Caperton's right to Due Process and he was biased in his decision-making. This type of situation bolsters the ideal of legal realism. The ideas that decisions rendered are often the result of political, social and moral predilections of state and federal judges.

The idea that judges can and do make decisions in a biased manner based on personal advancement definitely weakens the legal system. While it is unrealistic to expect that judges can be completely uninfluenced by their experiences and opinions, judges who stand to lose or gain a lot in a case should be eliminated in the interest of having as close to a fair trial as is permitted by the human condition. Not doing so weakens the entire legal system and undermines the documents, which establish the foundations of legal philosophy in this country. However, it is not only individual interest, which affects the decisions of a case but also the Federal Government Agenda.

The federal government sets agendas and initiatives for legislation, practices, and programs in the United States. These initiatives can range from issues concerning the mandate of seat belts in cars to concerns of national security. If an individual, local or state matter conflicts with one of these agendas, the federal governmental ways takes precedent. In effect, this sometimes damages or detriments the cases which are deemed less important. This has been seen throughout US history.

One of the examples of this is the case of Geier v. American Honda Motor Company. Alexis Geier suffered severe facial and head damage in a car accident while driving a 1987 Honda Accord, which did not have a driver side airbag. (Eier v. American Honda Motor Company) The Geiers sued American Honda Motor Company for negligence in not providing proper safety equipment in their cars. The court ruled in favor of Honda because the lawsuit conflicted with the measures provides protection of United States citizens against terrorist, attack, and threat from other governments. This strengthens the ability of the legal system to implement protective legislation in the interest of the people.

However, the neglect of Korematsu's rights in the interest of a government initiative is wrong for the same reason as it was for Geier. This balance between what is good for the whole vs. the good of the individual has been long debated, and will doubtfully ever be brought to resolution. The legal system is ever evolving with each new case that is brought forth, precedent and procedure changes with it. What is certain is that as long as human beings are in judgment of cases and proceedings, human vulnerabilities and tendencies will follow and therefore influence the decisions that are made. Race, promotion of personal interest, and precedent of government initiatives are only a few of the issues which factor into the decisions rendered in the court of law. As long as the people make the law, the people's humanity will always be their own worst enemy

Various debates and research works are going on in the U.S.A on Implicit Bias particularly in the Judicial System. Implicit means that something is understood but not clearly stated. Bias means cause to feel or show inclination or prejudice for or against someone or something. Hence Implicit Bias is defined as someone consciously rejects stereotypes and supports anti-discrimination efforts but also holds negative associations in his / her mind unconsciously. Scientists have learned that we only have conscious access to 5 percent of our brains—much of the work our brain does occurs on the unconscious level. Thus, implicit bias does not mean that people are hiding their racial prejudices. They literally do not know they have them.

Coming back to the fundamental question of What's in a name?; how the name DRT can influence the course of a case? The nomenclature DRT means Debt Recovery Tribunal. It is implicit that the Tribunal is set up for the Recovery of Debt and the Act of 1993 is known as Recovery of Debts Due to Banks and Financial Institutions. Does it not establish that the very name DRT creates an IMPLICIT BIAS among the Presiding Officers of DRT that only recovery of debt is the sole motto of the Tribunal and the prime duty of the Presiding Officer of DRT is to recover the dues of the Banks and Financial Institutions leaving the litigant borrowers on the lurch by giving a definite advantage to the banks and Financial Institutions?

Since the Act is an enactment of Parliament which is an advancement of Government initiatives to recover the debts of the Banks and Financial Institutions which also involves the personal interest of the Presiding Officers, an implicit bias is already created in the decision making process of DRT in favour of the Banks and Financial Institutions.

Yet another factor to be considered is the role of the Authorised Officer under SAFAESI ACT. An Authorised officer means an officer not less than the Chief Manager of a public sector bank or a person holding an equivalent rank of a secured creditor empowered to exercise the rights of the secured creditor under the Act. Hence, he enjoys vast powers as that of a Judge in a Court. Since the Authorised Officer is appointed by the same secured creditor, his action will always have an implicit bias.

Perhaps understanding the chances of bias by the Authorised Officer may have against the defaulted borrower, Supreme Court has made an observation in their judgment in the famous Mardia Chemical case which states:
Liquidity of finances and flow of money is essential for any healthy and growth-oriented economy. But certainly, what must be kept in mind is that the law should not be in derogation of the rights which are guaranteed to the people under the Constitution. The procedure should also be fair, reasonable and valid, though it may vary looking to the different situations needed to be tackled and object sought to be achieved.

Besides, the judgment further says, In the background we have indicated above, we may consider as to what forums or remedies are available to the borrower to ventilate his grievance. The purpose of serving a notice upon the borrower under sub -Section 13 of the Act is, that a reply may be submitted by the borrower explaining the reasons as to why measures may or may not be taken under sub-section (4) of Section 13 in case of non- compliance of notice within 60 days.

The creditor must apply its mind to the objections raised in reply to such notice and an internal mechanism must be particularly evolved to consider such objections raised in the reply to the notice. There may be some meaningful consideration of the objections raised rather than to ritually reject them and proceed to take drastic measures under sub-section (4) of Section 13 of the Act.

What more evidences are needed to prove the IMPLICIT BIAS of the Presiding Officer and the Authorised Officer?
A closer look at the way most of the Presiding Officers function creates an impression that they are acting like a recovery agent and not as a legal authority having the powers of a civil court. Yet another important factor is that the very name Debts Recovery Tribunal induces a psychological phenomenon of Auto Suggestion which in medical terms means self suggestion: the process by which a person induces himself an uncritical acceptance of an idea, belief, or opinion.

Further it also signifies:
the dwelling upon an idea, thought, or concept thereby inducing some change in the mental or bodily functions and also the process by which a person induces self acceptance of an opinion, belief, or plan of action.

The meaning of induce is:
to persuade someone to do something brought about or caused, not spontaneous and also to infer by inductive reasoning.

The name DRT indirectly and seemingly imposes its authority to induce the Presiding Officers to influence their decisions through the following methods:
  1. Suggestion by impression, as by, authoritative statement,
  2. Suggestion by inducing the idea in the mind, by insinuation, hint, and other indirect means, and
  3. Suggestion along the lines of association of outward objects etc,
which act both by impressing and inducing the idea in the respective mind of the person so suggested to. Above all the feeling that the banks and financial institutions are the custodian of public money renders further credence to their right of recovery through their inductive mental attitudes forgetting the fact that every right is derived out of a duty first to be performed and the duty being duty of care and concern for the honest customers with integrity.

Considering the aforesaid facts, Does not the name Debt Recovery Tribunal induces an implicit bias not only among the Presiding Officer, Authorised Officer, Advocates and even the defaulted borrowers?
In the final analysis what's in a name? Is it a destiny? If so, it need not be a destiny based on implicit bias, advancement of Government initiatives or personal discrimination but can be on the foundation of finding the truth and circumstances which are many times beyond the control of the banks and financial institutions and the defaulted borrower and by making a distinction between a borrower with honesty and integrity and an intentional defaulter. Then the name will be worth the name and the destiny will be justifiable. Otherwise it raises another question, Where Principles of Natural Justice has gone?

Written By: T. R. Radhakrishnan, Banking & Management Consultant, NPA Resolution Consultant, H.R. Trainer: Corporates, Colleges & Schools, & Freelance Writer,
Address: No. 8, Morya Gardens, Kanadia Road, Indore.452016 (Madhya Pradesh)
E-mail: [email protected]

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