Pakistan is a common law jurisdiction with a written constitution promulgated in 1973. Laws are generally codified in the form of enactments made by the federal and provincial legislatures. The constitution places prime importance on the judgments of the superior courts of the country by making judgments of the Supreme Court of Pakistan and the five High Courts binding on all courts subordinate to them.

The laws relating to companies, contract and property are largely based on principles of English common law. Certain provisions of criminal law are based on principles of Islamic law. Subjects such as marriage and inheritance of property are matters of personal law, and thus the applicable law will depend on the religion of the individual concerned.

Courts follow an adversarial system.  Proceedings are conducted through written submissions in the form of pleadings, interlocutory applications and written arguments in conjunction with oral advocacy. The role of the judge in the Pakistani legal system is that of a neutral adjudicator.

Pakistan’s court system follows a hierarchy with the Supreme Court being the apex court followed by five High Courts, one exercising jurisdiction over each province and one exercising jurisdiction over the Islamabad Capital Territory. Subordinate to the High Courts are numerous subordinate courts, which are generally the courts of first instance in civil and criminal disputes.

The Supreme Court exercises appellate, advisory and limited constitutional jurisdiction of an original nature. The High Courts exercise appellate jurisdiction, constitutional jurisdiction of an original nature as well as original jurisdiction conferred on them by specific statues. As an exception the High Court of Sindh also exercises original civil jurisdiction in respect of the district of Karachi for matters valued at PKR65 million or more.

The High Courts have a wide constitutional jurisdiction under which they can adjudicate actions for enforcement of fundamental rights and challenges to the legality of actions of government authorities. Any party aggrieved by the actions of such authorities may petition the High Court for relief in the nature of the issuance of a writ.

Each district within the country has subordinate civil as well as criminal courts.

For civil matters there are District Courts, which are further divided into the court of District Judges or Additional District Judges and courts of Civil Judges. The courts of Civil Judges act as courts of first instance in most civil matters with the court of the District Judges or Additional District Judges exercising appellate jurisdiction over the former. The courts of the District Judges or Additional District Judges also act as courts of first instance for certain special matters as provided for by statute.

For criminal matters there are the courts of the Sessions Judges or Additional Sessions Judges and the Magistrates’ courts. The Magistrate’s courts act as the courts of first instance for most crimes. Offences punishable with death and those arising out of Hudood laws are tried by Sessions Judges or Additional Sessions Judges. Magistrates may appeal to Sessions Judges or Additional Sessions Judges, or in some special cases to the High Court.

Subordinate courts also include special courts and tribunals that exercise jurisdiction as conferred by statute in respect of cases having a certain subject matter such as tax, banking, labour, civil service, intellectual property, insurance, competition, etc.

The constitution also establishes a Federal Shariat Court (subordinate to the Supreme Court) that may of its own motion or if so petitioned by any person, examine existing laws to ensure they are in conformity with Islamic injunctions as set out in the Quran and Sunnah.

In addition to the above, there are numerous ombudsmen appointed under specific laws that deal with matters such as insurance, banking, tax and sexual harassment. In general, appeals from decisions of the Federal Ombudsman are brought before the President and appeals from decisions of the Provincial Ombudsman are brought before the governor of the relevant province.

Court proceedings and all filings are generally open to the public. While there is no specific provision to protect court proceedings or filings from public disclosure, the courts have inherent powers to make such orders as may be necessary for the ends of justice or prevent abuse of process of the court.

Legal representation is regulated in Pakistan. Legal representatives are required to have a valid licence to practice as advocates. The following are pre-requisites to being qualified to practice as an advocate in Pakistan as set out in the Legal Practitioners and Bar Councils Act, 1973. An individual must:

• be a citizen of Pakistan or Jammu and Kashmir;
• be a foreign national who has been residing in Pakistan for one year and is a national of a country where citizens of Pakistan who are duly qualified may be permitted to practice law;
• be 21 years of age or over;
• have obtained a degree in law from Pakistan or abroad that is recognised by the Pakistan Bar Council; and
• have paid the enrolment fees and completed the training period prescribed by the Pakistan Bar Council.

Initially an individual may be enrolled as an advocate of the subordinate courts, which gives the advocate rights of audience before all subordinate courts of the relevant province.

After two years of practicing as an advocate of the subordinate courts, advocates may be eligible to enrol as an advocate of the High Courts. Lawyers who are enrolled as an advocate of a High Court for seven years and who meet other eligibility criteria are eligible for enrolment before the Supreme Court.

In light of the rules set out in the Legal Practitioners and Bar Councils Act, 1973, foreign advocates are not eligible to appear and conduct cases before the courts of Pakistan.

There are no restrictions in Pakistan on third party-funding for litigation. However, such funding is not a feature of litigation in Pakistan nor are there any advertised providers of such funding.

There are no restrictions as to the type of lawsuits that may be funded by third-party funding.

There are no restrictions in Pakistan on third party-funding for litigants, as such, third-party funding could potentially be raised for any party in litigation.

There is no regulation as to the amount that can be raised via third-party funding.

Commercial third-party funding is not a feature of litigation in Pakistan nor are there any advertised providers of such funding.

Contingency fees are not permissible in Pakistan.

There are no time limits regulating third-party funding. If funding is obtained by a third party, the same constitutes a contractual relationship between the parties which can be negotiated.

Prior to initiating litigation in Pakistan, there are no mandatory pre-action protocols that must be followed except in specific cases that are required by law. For example, under the Defamation Ordinance, 2002 a potential litigant must give 14 days’ notice to the other party of the intention to bring a lawsuit, notice for which must be served within two months of the publication of the allegedly defamatory statement.

A lawsuit against the government or against a public officer arising from an act performed in their official capacity may be filed two months after a written notice has been delivered to the defendants at their official address. Where a suit is initiated without delivering such notice before the expiration of the two months, the lack of notice does not serve as a bar to institution of the lawsuit. However, the plaintiff will not be entitled to costs if a settlement is reached, or the government or public officer concedes the claim within two months of the institution of the lawsuit.

While there are no general rules for pre-action conduct before initiating proceedings, it is common for claimants to serve legal notices on opposing parties prior to initiating lawsuits.

The law governing limitation periods for civil suits is primarily set out in the Limitation Act, 1908. The limitation period differs for different types of civil suits between 30 days and 12 years. In most cases lawsuits of a civil nature must be filed within a limitation period of three to six years. In addition to the Limitation Act 1908, some statutes also provide for special limitation periods to be applied in certain cases.

The exact event which triggers the commencement of the limitation period may differ depending on the nature of the case. In some cases, the limitation is triggered by the happening of an event, in others, by the party becoming aware of the event.

The jurisdiction of the courts is governed by the Code of Civil Procedure, 1908 whereby the jurisdiction generally follows the defendant. Lawsuits are required to be instituted before the court having territorial jurisdiction over the place where the defendant resides or carries on business and/or where the cause of action arises. Lawsuits relating to immovable property are generally required to be instituted before the court having territorial jurisdiction over the place where the immovable property is located.

Plaintiffs initiate lawsuits by filing a plaint setting out all material facts giving rise to their claim, together with the relief sought. The plaint must be presented in the relevant court of first instance in accordance with the procedural requirements of the Code of Civil Procedure 1908 and be accompanied by the requisite court fee. The plaint must also attach all relevant documents that are relied upon by the party filing the lawsuit.

The party may make an application for amendment or alteration of the pleadings which may be granted by the court if the same is in the interest of justice and for determining the real controversy between the parties. A court may also of its own motion, order a party to furnish better pleadings if the plaint is vague.

The rules of service are governed by Order V and the accompanying rules thereunder of the Code of Civil Procedure, 1908. The responsibility to issue summons to the defendant is the courts, provided that the plaintiff pays costs for issuance of summons after the suit has been duly registered.

Summons are ordinarily served by registered post and personal service; however, if service is unsuccessful, the court can order service by several means, including service by publication in a newspaper. To avoid delays occasioned by unsuccessful service, the aforesaid provisions of the Code of Civil Procedure 1908 have recently been amended in Punjab, the country's most populous province, Khyber Pakhtunkhwa and the Islamabad Capital Territory, to require summons to be served, in the first instance, simultaneously by registered post with acknowledgement, courier and by other methods that were previously available only for substituted service

Summons are issued to the defendant at the place where they ordinarily reside. Parties outside the territorial jurisdiction of the court may be sued if the cause of action arises wholly or partly within the territorial jurisdiction of the court. Where the defendant is outside the territorial jurisdiction of the court, but in Pakistan, summons are served through the subordinate judiciary of the district where the defendant is located. Where the defendant is outside Pakistan, summons are generally served through post and international courier.

If summons have duly been served on a defendant and they do not appear at the day of hearing, the court may proceed in the absence of the defendant and may eventually either allow or dismiss the lawsuit. However, as a matter of practice, courts will typically give a defendant multiple opportunities of appearing before proceeding to decide the suit ex parte in their absence.

Litigants may bring a lawsuit jointly if their right to sue arises out of the same transaction or series of acts or transactions, whether jointly, severally or in the alternative, where, if such persons brought separate lawsuits, any common question of law or fact would arise. Further, parties may with the permission of the court sue on behalf of or for the benefit of all persons interested. In those cases, notice is required to be given to all persons of that action.

The nature of representative actions described above are limited in their application and are not in the nature of class action lawsuits as are seen in jurisdictions like the US. Often, litigation seeking to further a public interest is brought by invoking the constitutional jurisdiction of the High Court, which has broad powers to issue writs and make orders to protect fundamental rights. Litigants cannot, however, obtain monetary compensation through such proceedings.

There are no legal requirements to provide clients with a cost estimate of actual or potential litigation. Advocates in Pakistan, however, normally charge a lump sum fee for representation in a lawsuit until judgment is obtained. As a result, fees settled in this manner may serve as a cost estimate for the relevant proceedings.

Interim application before trial or otherwise during the pendency of legal proceedings are quite common. They may be made for a variety of reasons such as obtaining interim relief, case management and discovery of documents.

Where an admission of fact has been made in a lawsuit, a party may make an application to the court for a judgment to which it may be entitled on the basis of such admission. The admission of facts by a party must be clear and unqualified for a judgment to be pronounced. In Khyber Pakhtunkhwa, an amendment to the Code of Civil Procedure, 1908 allows the court to grant a summary judgment on the whole or part of a claim or defence or the court may grant summary judgment on its own initiative if:

• it is satisfied that the party against whom such judgment is sought has no real prospect of succeeding on the claim or successfully defending the claim; and
• there is no material fact under dispute that requires a trial and the party is entitled to a judgment as a matter of law.

Further, in certain kinds of cases, including suits on negotiable instruments and for recovery of moneys borrowed from a financial institution, the courts are required to adopt a summary procedure whereby the defendant does not have a right to defence unless the court, on the application of the defendant, grants leave to defend. In such cases, the court may either decree the suit in favour of the plaintiff, grant the defendant conditional leave to defend or grant the defendant unconditional leave to defend. The timing and legal test applicable to the leave to defend varies depending on the nature of the claim and is set out in the applicable statute.

In case of a challenge to the jurisdiction of a court, a defendant may apply for return of plaint on jurisdictional grounds under Order VII Rule 10 of the Code of Civil Procedure, 1908, requesting that the plaint may be returned to the plaintiff so that it may be brought before a court with jurisdiction.

In case of fundamental defects in a suit, a defendant may make an application for rejection of plaint under Order VII Rule 11 of the Code of Civil Procedure, 1908. The plaint is liable to be rejected if the lawsuit is barred by law, there is no valid cause of action disclosed in plaint, or the claim in the plaint is undervalued or on insufficiently valued stamp paper and the plaintiff does not amend the valuation or pay the stamp duty.

Please see 4.2 Early Judgment Applications for early judgment applications and other forms of expedited procedures.

Initially, the plaintiff determines the parties to a lawsuit by impleading the them in the plaint. After institution the court seized of the lawsuit has the authority to add or delete plaintiff and/or defendants to the lawsuit under Order 1 Rule 10 of the Code of Civil Procedure, 1908. Persons may be joined as defendants if they are necessary parties (in whose absence no effective decree can be passed) or proper parties (whose presence is necessary to enable the court to effectually and completely adjudicate questions involved in the suit). Powers under Order 1 Rule 10 of the Code of Civil Procedure 1908 may be exercised by the court of its own motion or upon an application by an interested party.

Security for costs is only available in limited circumstances: pursuant to Order 25 of the Code of Civil Procedure 1908, in case the sole plaintiff or all of the plaintiffs are residing out of Pakistan and none of the plaintiffs possess sufficient immovable property within Pakistan other than the lawsuit property (if any), the court may of its own motion or on the application of the defendant, order the plaintiff(s) to give security for all costs incurred and likely to be incurred by the defendant.

Recently, legislation has been introduced in various jurisdictions within Pakistan that enhances the power of the courts to award costs; however, it remains to be seen how effective such legislation will be. Ordinarily, litigants in Pakistan are not awarded the costs of interim applications.

There are no prescribed timeframes for disposal of interim applications. In practice the timeframe depends on a variety of factors including, the nature or complexity of the application, the court before which it is pending, and any grounds for urgency.

Where urgent ad-interim relief is required, courts can grant such relief ex parte if the time that would require to service notice to the defendant would defeat object of the application.

Parties can move an interim application seeking early fixation of cases which applications may be granted at the discretion of the court.

Adjudication of contentious interim applications may take several months or even years.

Discovery is the formal process of exchanging information between litigants and may be done through serving interrogatories or producing documents as set out in Order XI of the Code of Civil Procedure, 1908.

Discovery via interrogatories entails the submission of question to a party in a particular format with the permission of the court, which are then answered by way of an affidavit. The court may refuse to allow interrogatories that do not relate to any matter in question in the lawsuit, even if the questions may be allowed at the time of cross examination of a witness. Further, the court may set aside interrogatories if they are scandalous or deemed to be unreasonable or vexatious.

Discovery can also be effected by seeking an order of the court for the production of documents. Such order may be made where court considers necessary. Such an order can be made in respect of documents relied on by a party in their pleadings or in respect of documents in a party’s possession. The Code of Civil Procedure 1908 provides for focused document production rather than US-style discovery.

It is not possible to obtain discovery from a third party.

While the legal framework for discovery and inspection of documents is provided for under Order XI of the Code of Civil Procedure 1908 discovery is not a common practice in Pakistan. There is no obligation in the law to generally preserve documents pending trial and perjury is rarely punished in practice. As a result, litigants do not rely on obtaining using useful documents and information through discovery.

There are no alternatives discovery mechanisms in Pakistan.

Legal privilege is recognised in Pakistan. Under Articles 9 and 12 of the Qanun-e-Shahadat Order 1984 (being the relevant law governing evidence in Pakistan), an advocate’s advice to a client and communications between an advocate and a client are privileged and their production in evidence cannot be compelled by a court. However, this does not extend to in house counsel who are salaried employees and therefore cannot practice as advocates.

Parties may object to the discovery under Order 11 Rule 20. In this case if the Court is satisfied that the discovery sought depends on the determination of any issue in dispute or that it is desirable that a particular issue be determined before allowing discovery, it may do so first before allowing discovery.

Courts can grant both interim and perpetual injunctions.

An interim injunction relief is sought by way of an interlocutory application supported by an affidavit. Such relief may be granted if any property in dispute is in danger of being wasted, damaged or alienated or wrongfully sold in execution of a decree or where the defendant threatens or intends to remove or dispose of his property with a view to defraud his creditors. Further, an interim injunction may also be granted injunctive relief to prevent the continuance or repetition of a breach of contract or other actionable wrong. In order to obtain an interim injunction, the applicant must establish that it has a prima facie case, that the balance of convenience rests in its favour and that it would suffer irreparable harm if the injunction is not granted.

Perpetual and mandatory injunctions are governed by the Specific Relief Act, 1877. They are sought in the plaint and can be granted by way of final relief in a suit. Perpetual injunctions are orders restraining the performance of an act which a party is obliged not to do. They are granted to prevent the breach of an obligation existing in favour of the applicant or where the defendant impedes the plaintiff’s right to or enjoyment of property. Mandatory injunctions are granted where to prevent the breach of an obligation, it is necessary to compel the performance of an act which the court is capable of enforcing. There are a number of bars to the grant of an injunction. These include the rule that an injunction cannot be granted to prevent the breach of a contract which cannot be specifically enforced. Both perpetual and temporary injunctions are granted at the discretion of the court; they can be refused on equitable considerations even where the applicant otherwise satisfies the statutory requirements.

The court also has the power to grant other forms of interim injunctions such as Mareva or freezing injunctions and anti-suit injunctions, however, these are quite rarely granted.

Upon hearing a party making an application for urgent injunctive relief, the Court can in appropriate cases grant such relief immediately ex parte while directing notice to the party against whom relief is claimed. 

Applications for urgent interim relief in the High Courts are taken up for hearing on the say they are filed provided the applicant demonstrates sufficient urgency. On holidays and after courts hours, the applicant must approach the registrar, who will have the application placed before a bench of the court if the matter is sufficiently urgent.

Temporary injunctions may be obtained ex parte, without notice to, and in the absence of the respondent, in cases of urgency where the court is satisfied that the time that would be required to serve notice to the respondent would defeat the object of seeking the injunction.

An applicant can be held liable for damages suffered by the respondent if the respondent subsequently discharges the temporary injunction. A respondent against whom a temporary injunction is issued, ex parte or otherwise, can:

• make an application to the court under section 95 of the Code of Civil Procedure, 1908 under which the court can award compensation not exceeding PKR 10,000 for the injury caused, where it appears to the court that the injunction was applied for on insufficient grounds; or
• bring a suit for compensation in respect of an injunction wrongfully obtained.

In Punjab, section 95 of the Code of Civil Procedure, 1908 was amended in 2018. Notably, the amended provision entitles the Court to award punitive compensation without any limit to the aggrieved party for expense and injury caused by the injunction. Such compensation may be awarded by the court on its own motion or on the application of an aggrieved party. The court can also require the party at fault to deposit in the public exchequer a penalty for abusing the process of the law and wasting the time of the court. 

Courts can require the applicant to provide security for the respondent’s potential damages at the time of granting temporary injunctions. However, this power is rarely exercised.

Injunctive relief can be granted against worldwide assets of a respondent. However, such injunctions are rarely sought and are unlikely to be granted where the court does not have personal jurisdiction over the respondent.

Injunctive relief cannot be sought against persons not party to a suit. However, such persons can be brought under the ambit of a temporary injunction if the applicant is able to establish that the person who is not a party is acting on behalf of a respondent against whom an injunction has been issued. 

Further, plaintiffs may implead third parties to a suit as defendants if they are holding assets of the respondent in respect of which a temporary injunction is sought so that the third parties are bound by such injunction.

In case of disobedience or breach of an interim injunction the court may order the property of the person guilty of such disobedience or breach to be attached and may also order such person’s arrest. Further, to the extent a failure to comply with the terms of an injunction constitutes contempt of court, the party that disobeys the injunctive order can be subjected to contempt proceedings before the relevant high court, where a finding of contempt can be punished with imprisonment, which may extend to six months, or with a fine, which may extend to PKR100,000 or with both.

In a civil suit, after the filing of the defendant’s written statement of defence, and examining the parties if necessary, the court frames the issues on which the decision of the suit appears to depend. The issues are based on the material propositions of law and/or fact in dispute between the parties.

Trials are the examination of all oral and documentary evidence relied upon by the parties to the lawsuit. Before trial, each party is required to file a list of witnesses whom they propose to call either to give testimony (with or without producing documents) or only to produce documents. Evidence is first conducted by the plaintiff followed by the defendant.

A witness is first examined-in-chief by the party calling the witness. Ordinarily, in civil matters, the examination-in-chief is conducted by the witness reaffirming the contents of his or her affidavit in evidence in the presence of the court or the commissioner and producing the documents relied on in such affidavit. This practice has been codified in recent amendments to the Code of Civil Procedure 1908 in Punjab, Khyber Pakhtunkhwa and Islamabad Capital Territory, which make provision has been made for the affidavit in evidence to be construed as the examination-in-chief. The witness is also asked to present documents filed in support of the affidavit in evidence. Following the examination-in-chief, the opposing party is invited to cross-examine the witness orally. Thereafter, the counsel of the party calling the witness may re-examine the witness.

Any documents sought to be relied on are presented by the relevant witness during the examination-in-chief and documents with which a presumption of truth is attached can be produced in evidence under a statement of the counsel of the party who wants to produce such documents as evidence.

The testimony of fact witnesses and experts is given orally in the presence of a judge or a court-appointed commissioner. The evidence of these witnesses is taken down in writing in a narrative form by or under the directions of the judge or commission. In the recent amendments to the Code of Civil Procedure 1908 in Punjab, Khyber Pakhtunkhwa and Islamabad Capital Territory, provision has been made for evidence and the proceedings thereof to also be recorded by audio and video. In a recent judgment announced on 21 November 2022 in Civil Petition No. 1795 of 2022, the Supreme Court held that evidence of a witness who is not physically present in court may be given in civil cases by using videoconferencing, within the existing legal framework.

In deciding whether to allow evidence to be given by videoconferencing, courts must consider the following:

• whether the evidence of the witness appears essential to the just decision of the case; and
• whether requiring physical attendance of the witness in court would cause unreasonable delay, expense or inconvenience.

Generally

There is no statutory requirement mandating compulsory case management and scheduling hearings in civil suits. Ultimately, the timetable of a case is in the hands of the judge responsible for enforcing timelines, including those mandated by law. Counsel for the parties can make representations to the judge to shorten or extend timelines and judges are generally lenient with requests for adjournments.

Recent Amendments

Recent amendments to the Code of Civil Procedure 1908 in Khyber Pakhtunkhwa and Islamabad Capital Territory have made provision for the respective High Courts to make rules applicable to civil courts subordinate to them in connection with case management and scheduling conferences.

Further, recent amendments to the Code of Civil Procedure 1908 in Khyber Pakhtunkhwa and Islamabad Capital Territory seek to address delays that in suits in which interlocutory applications are filed; such lawsuits would not proceed to trial and subsequent stages until interlocutory applications were decided. The amendments require separate files to be prepared for such cases so that the interlocutory applications and the main case (including evidence and final arguments) can proceed concurrently.

Proceedings in Interlocutory Applications

If the claim is accompanied by an interlocutory application which is urgent, that application is fixed before the court for order along with the relevant urgent application. At this stage, the court decides whether a notice of the application is to be issued to the opposing party and the court may pass a preliminary order on that application, such as an ad-interim injunction granting the relief sought.

Thereafter, that application is fixed before the court for hearing. The notice of the application invites the opposing party to file a reply by way of counter affidavit to the application. If the counter affidavit is filed, the applicant is ordinarily allowed an opportunity to file a rejoinder. Once the court is satisfied that it must proceed with the hearing of the application, it invites arguments from both sides and passes an order on the pending interlocutory application(s).

Proceedings in the Main Suit

Following the filing of a reply (ie, the written statement of defence)by the defendant to the main claim (ie, the plaint), the case is fixed in court for settlement of issues, and thereafter for evidence/trial, as described in 7.1 Trial Proceedings.

When the evidence has been concluded, the suit is fixed in court for arguments, and both parties's counsel are invited to make oral submissions before the court issues a judgment. Oral arguments can span multiple hearings with advocates rebutting each other’s submissions on points of law and fact.

Although the court and the procedural rules governing the suit provide time periods for the various phases of the suit, it is uncommon for those procedural timelines to be strictly enforced. It is more common for parties to seek and be granted adjournments.

Jury trials are not a feature of the legal system of Pakistan.

Admissibility of evidence is governed mainly by the Qanun-e-Shahadat Order, 1984 (QSO). As per Article 131 of the QSO, the judge determines the admissibility of evidence.

Oral evidence may be given to prove all facts except the contents of documents as per Article 70 of the QSO. Further, Article 71 requires oral evidence to be direct, ie, must be given by a witness who has themselves seen, heard or otherwise perceived the fact sought to be deposed. 

The contents of documents may be proved by primary evidence (the original document) unless the conditions in Article 76 of the QSO for proof of the contents of documents by secondary evidence (copies, certified or otherwise or oral accounts of a person who has seen such document) By way of illustration, some of the circumstances in which secondary evidence is admissible are the following:

• Where the original document is in the possession of the other party in a lawsuit.
• Where the original is in the possession of a person not accessible or not subject to the process of the court.
• Where the original has not been provided despite notice under article 77 of the QSO.
• Where the original has been destroyed or lost or when the party relying on such document cannot produce it in time for any reason other than their own default or neglect.

Documents relating to financial or future obligations should be attested by two males or one male and two females as witnesses as per Article 17 of the QSO. Any such document will not be admissible in evidence unless the attesting witnesses have been called to prove its execution, provided they are alive, subject to the process of the court and capable of giving evidence.

A further requirement as to the admissibility of certain documents emanates from the Stamp Act, 1899, under which certain documents (including agreements, affidavits, bills of lading, conveyances, powers of attorney, promissory notes and share certificates) are chargeable to stamp duty. Any such documents that are not duly stamped are not admissible in evidence.

Expert testimony is permitted in accordance with Section 59 of the QSO , where it is necessary for the court to form an opinion concerning foreign law, scientific or artistic matters, the identity of handwriting or finger impressions. Expert evidence can be given by persons who are specially skilled in such matters.

By default, all hearings are open to the members of the public unless the judge specifically chooses to conduct a hearing in private.

Court proceedings follow an adversarial system. Examination and cross examination of witnesses is conducted by counsel.

In hearings the level of intervention by judges varies across judges. This  it also depends on the subject matter of the litigation and the complexity of the factual and legal matrix. Judges intervene when, for instance, it is necessary to clarify a point or raise an issue that has been overlooked, to exclude irrelevant points or repetition or to prevent undue evasion.

At the conclusion of a hearing in a civil case, a judge may either announce judgment or reserve the case for judgment. Ordinarily, the mode the judge adopts will depend on the complexity and urgency of the matter. In civil cases, judgments must be pronounced in open court as required by Order XX of the Code of Civil Procedure, 1908.

There is no specific timeframe for the conclusion of a civil suit in Pakistan. The Code of Civil Procedure, 1908 provides that the period to be allowed by court for filing of a written statement of defence shall not ordinarily exceed 30 days. It also provides the Court shall fix a date no later than 15 days of completion of the evidence stage for hearing arguments of the parties. There is also provision that unless the court announces judgment at the conclusion of the hearing, it shall do so within a period not exceeding 30 days.

Many courts in Pakistan are currently facing a lack of capacity owing to an overwhelming number of pending cases, inadequate number of judges and leniency in granting adjournments. It is therefore uncommon for the above and other timelines to be strictly enforced or adhered to.

Timeframes for suits vary considerably, depending on which court they are before and the subject matter of the proceedings. Due to backlog, suits before the subordinate courts can usually be decided between one to three years. In cases where suits are pending before the High Court, this period can be eight to ten years.

Court approval is not required to settle a suit out of court during its pendency. When the parties settle their dispute privately, the plaintiff is free to unconditionally withdraw the suit pursuant to Order XXIII, rule 1 of the Code of Civil Procedure, 1908. Unless the court at the time of withdrawal specifically grants permission to the plaintiff to file a fresh suit in respect of the same dispute in the future, such party shall be precluded from bringing such fresh suit. 

If the parties wish for the lawsuit to be decreed in terms of their settlement or compromise, permission of the court is required under Order XXIII, rule 3 of the Code of Civil Procedure, 1908. Generally, court do not withhold such approval and proceed to decree the suit in terms of the compromise, unless such terms are contravention of law or unrelated to the subject matter of the suit.

If the parties settle a suit privately and procure the unconditional withdrawal of suit by the plaintiff, the terms of the settlement can be kept confidential and are for the parties to disclose.

If the parties have the suit decreed in terms of their settlement or compromise, the terms will become publicly accessible as with court documents generally.

Settlement agreements constitute a contract between parties and can hence, be enforced as such. However, where a lawsuit has been decreed in terms of a settlement, a party may be able to seek execution of such decree as with any other decree of the court. There is conflicting case law in Pakistan regarding whether a party can seek execution of a compromise decree. Some judgments have held that a decree based on a compromise between the parties is a contract whose breach entitles the non-breaching party to bring a fresh suit. 

A settlement agreement, if in writing, can be an instrument and can be set aside by seeking its cancellation under the Specific Relief Act 1877. The cancellation may be granted if the instruments is established to be void or voidable such as in the case where the instrument has been executed on the basis of fraud, misrepresentation or without free consent.

The courts in Pakistan can grant successful litigants various substantive remedies, which are primarily set out in the Specific Relief Act 1877 and include the following:

• damages including interest;
• possession of movable or immovable property;
• specific performance of a contract;
• rectification of an instrument;
• rescission of a contract;
• cancellation of an instrument;
• declaration;
• prohibitory injunction;
• mandatory injunction; and
• recovery of money, including interest.

The rule governing contractual damages are set out in sections 73 and 74 of the Contract Act, 1877. Damages can be awarded to compensate for loss resulting from breach of contractual obligations. The injured party is entitled to compensation for any loss or damage caused to it by the breach, which naturally arose in the usual course of things from such breach, or which was known to the parties when they made the contract to result from such a breach. The injured party is not entitled to compensation for indirect or remote losses and is under a duty to mitigate its losses.

Where the contract stipulates the penalty for any breach of the contract, the party alleging breach is entitled to receive the sum stipulated by way of penalty in the contract without having to prove damage or loss. However, there is authority to suggest that the amount awarded must not exceed the loss suffered.

More generally, as reiterated by the Supreme Court in the Abdul Majeed Khan v Tasween Abdul Haleem and others 2012 CLD 6 damages are generally divided into general damages and special damages. General damages can be awarded for types of loss directly resulting from the wrong for which the loss cannot be calculated with exactitude such as physical or mental injury.  Special damages can be awarded for types of loss which are the actual but not necessary result of the wrong where a specific monetary value can be calculated such as medical bills or loss to property). General damages are not required to be specifically pleaded and proved whereas special damages must be. Further, Pakistan law recognises the principle that in cases of tort, damages are intended to put in the injured person in the position they would have been had they not received the injury.

Damages may also be granted as a matter of discretion or as may be provided by statute such as in the case of fatal accidents. However, awards of discretionary damages such as for common law torts are rare.

Pursuant to Section 34 of the Code of Civil Procedure, 1908, in decrees for the payment of money, the court may order interest at the rate it deems fit on the principal sum adjudged from:

• the date of the suit to the date of the decree; and
• for any period before the institution of the suit.

The court can also order further interest on the aggregate sum from the date of the decree to the date of payment.

Interest must be specifically claimed in the plaint and awarded in a decree in order to be recoverable by the plaintiff. The award of interest for any period prior to the decree is rare and depends on whether the contract or the statute governing the suit provides for payment of interest.

Domestic judgements may be enforced by way of initiating execution proceedings. Such proceedings entail seeking orders forcing compliance with the court order. In execution proceedings, the court may order:

• delivery of any property;
• attachment and sale or by sale without attachment of any property;
• arrest and detention in prison;
• appointment of a receiver; or
• any other directions that the nature of the relief granted may require.

Foreign decrees that are passed by a superior court of the UK or of a reciprocating territory are enforceable in Pakistan under Section 44A of the Code of Civil Procedure 1908 as if they were decrees passed by the District Court. It is to be noted that the UK has been deleted from Section 44A as applicable in the province of Punjab. Reciprocating territories and their relevant superior courts are specified by way of notification in the official gazette and include certain courts in New Zealand, Australia and the UAE.

For enforcement, a party is required to file in the executing court in Pakistan a certified copy of such foreign decree together with a certificate from the court stating the extend, if any, to which the decree has been satisfied.

A foreign judgment not covered under Section 44A of the Code of Civil Procedure, 1908 constitutes a fresh cause of action, entitling a party interested in its enforcement to institute a suit in the relevant court in Pakistan on its basis. In such cases, the foreign judgment may, for the purposes of fresh proceedings, be considered conclusive as to the matters adjudicated upon subject to the requirements of Section 13 of the Code of Civil Procedure, 1908.

Unsuccessful litigants have the right to appeal a decision made against them and are entitled to one appeal as of right. Both original and appellate decrees are subject to appeal. The grounds on which a second appeal may be filed are largely restricted to errors of law.

An appeal against a judgment of a civil judge may be made to the court of the district judge or the High Court, depending on the value of the lawsuit. A decision of the court of the district judge in appeal may be challenged in appeal before the High Court.

Where no appeal lies against an order or decree passed by the district judge in an appeal, that order or decree may be challenged by filing a revision before the High Court. Ordinarily, appeals from the High Court lie before the Supreme Court.

In civil matters, where the value of the subject matter of the dispute is above a specified amount and the High Court has varied or set aside the judgment of the court immediately below, the judgment of the High Court can be appealed to the Supreme Court under Article 185(2) of the Constitution. In other cases, an appeal from a judgment of the High Court will lie to the Supreme Court only if the Supreme Court grants leave to appeal.

Further, a party aggrieved of a decision can seek a review before the same judge where there is an obvious error in the decision.

Where no appeal lies against a decision of a court subordinate to the High Court, a revision application may be filed before the High Court where the subordinate court has exercised jurisdiction not available to it under the law, failed to exercise jurisdiction or acted in the exercise of its jurisdiction illegally and with material irregularity.

Where no other adequate remedy is available to a litigant to appeal against a judgment, a constitutional petition may be filed before the relevant High Court.

The process of appeals is governed by the Code of Civil Procedure, 1908. The right of first appeal is not restricted to any particular grounds and may exercised where the judgment suffers from any error of law and/or fact under section 96 read with Order XLI of the Code of Civil Procedure, 1908..

Parties aggrieved by the appellate judgment are entitled to make a second appeal in terms of and may have remedies against that further appellate judgment. The grounds for second appeals as set out in section 100 of the Code of Civil Procedure, 1908. These are where the decision is contrary to law, fails to determine a material issue of law or suffers from a substantial error or defect in the proceedings if it has affected the decision on the case on merits.

Where the parties do not have a further right of appeal, they can still challenge appellate decisions, on certain limited grounds, by invoking the constitutional jurisdiction of the high courts.

An appeal are instituted by filing a memorandum setting out the facts and grounds of appeal accompanied by a certified copy of the judgment that is being appealed.

On the day fixed for hearing the appeal, the court may either issue notice to the opposite party or if it finds that the appeal is without merit, dismiss the appeal. If notice is issued, the court fixes a date of hearing at which both parties are heard, after which the appeal is decided.

The period within which an appeal is required to be filed varies depending on the court that has given the impugned judgment and the jurisdiction that was exercised when giving such judgment. For instance, the limitation period for an appeal from a decree of the High Court hearing a case of first instance is 20 days and in case of an appeal to the District Court from a judgment of the civil court, such period is 30 days.

The triggering event for the limitation period for filing of an appeal is the passing of the judgement that is sought to be appealed.

An appeal is not a rehearing of a case; however, any legal or factual issues related to the decision under appeal may be addressed at the appellate stage. Such issues include errors of law and/or facts and issues with the conduct of the underlying proceedings.

Additional evidence cannot be introduced in the appellate proceedings. The appellate court can allow such evidence or document to be produced or witness examined if:

• the court whose decision is appealed refused to admit evidence which ought to have been admitted; or
• the appellate court required any document to be produced or witness to be examined to enable it to pronounce judgment or for any other substantial reason.

There are not general conditions imposed by the court on granting appeals. The court may impose any conditions it considers necessary upon granting an appeal.

Powers of the appellate court are set out in section 107 and detailed in Order XLI of the Code of Civil Procedure, 1908. Appellate courts have the power to determine a case finally setting aside, affirming or modifying the impugned decision.

The appellate court may make any decision which ought to have been given or made. It can also remand the case to the subordinate court for reconsideration of the case with or without specific directions or take additional evidence or require such evidence to be taken.

All litigation costs, such as court fees, advocate’s fees, and miscellaneous expenses are to be borne by the parties to the litigation.

The court has the power under section 35 of the Code of Civil Procedure, 1908 to award costs to the successful party. Further, where a claim or defence is alleged by the objector to be false or vexatious and is subsequently disallowed, the court may require the party to pay compensatory costs to the objector. Such compensatory costs are limited to PKR 25,000 to PKR 100,000.

As a matter of practice, courts do not generally grant costs and when granted these are limited to amounts paid by way of court fees.

Ordinarily the only costs awarded are the court fees paid by the plaintiff and therefore the only factor being considered in most cases is the amount of court fees paid.

It is possible for the court to grant interest on costs up to 6% per annum, which is added on to the costs that are awarded.

Alternative Dispute Resolution (ADR) is generally viewed as a less efficacious method of dispute resolution than litigation. The most popular ADR method is arbitration. Whilst other forms of ADR such as mediation and conciliation are now gaining recognition they are generally viewed as ineffective as compared to arbitration.

There have been significant legislative changes in Pakistan recently encouraging the resolution of dispute by way of ADR including arbitration, mediation and conciliation. Nevertheless, such changes have not yet been implemented in practice, and for the most part courts continue to hear suits as they did previously.

The Code of Civil Procedure (Sindh Amendment) Act 2018 was enacted by Sindh, amending the Code of Civil Procedure 1908 (CPC) as it applies in Sindh. Pursuant to such changes, the courts in Sindh have been given the power to mandatorily refer parties to any form of ADR.

Punjab enacted the Punjab Alternate Dispute Resolution Act 2019, which is applicable to both civil and criminal matters. The Lahore High Court made certain amendments to the First Schedule of the CPC as applicable in Punjab. Under the Act, the courts are required to refer to ADR the disputes listed in Schedule 1 of the Act, whereas the courts have been empowered to refer to ADR disputes listed in Schedule 2. The Act contemplates a resumption in litigation if ADR fails. Pursuant to these changes in the CPC, courts hearing civil suits are required to refer the dispute for mediation except where the court is satisfied that the case involves an intricate question of law or fact or that there is no possibility of successful mediation. When referring a case for mediation, the court may specify the material issues for determination through mediation. When a case is so referred, its proceedings in court are stayed for a period not exceeding 30 days, and the parties are directed to the Mediation Centre established by the Lahore High Court.

The Alternate Dispute Resolution Act 2017 was enacted in Islamabad along with changes in the CPC. Under this Act, where the court is satisfied that a scheduled dispute can be resolved by ADR and it does not involve an intricate question of law, the court may refer the dispute to ADR. In this case, the court requires the consent of the parties to refer the matter to ADR.

Khyber Pakhtunkhwa enacted the Khyber Pakhtunkhwa Alternate Dispute Resolution Act 2020. This Act applies in the same manner as the Alternate Dispute Resolution Act 2017 discussed above.

Balochistan has not yet introduced any legislation empowering courts to refer matters to the ADR.

The following are some of the existing institutions offering ADR facilities in Pakistan:

• National Centre for Dispute Resolution.
• ADR Centre Lahore High Court.
• ADR Pakistan Alliance.
• Centre for International Investment and Commercial Arbitration (CIICA).

The laws that govern arbitration in Pakistan are as follows:

• The Arbitration Act 1940 (the 1940 Act), which applies to local arbitrations.
• The Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act 2011 (the 2011 Act), which applies to foreign arbitrations.

There are three approaches to arbitration provided by the 1940 Act listed below:

• without the intervention of the court;
• with the intervention of the court; and
• with the intervention of the court but where a lawsuit is pending between the parties and they agree for the resolution of their disputes through arbitration, keeping the lawsuit pending, and that the fate thereof (lawsuit) be decided on the basis of the decision rendered by the arbitrator.

The 2011 Act has been enacted to incorporate into domestic law the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, or New York Convention, which Pakistan has ratified.

Generally, all disputes involving private rights capable of forming the subject of a suit can be referred to arbitration.

Court decisions however suggest that matters covered by specific legislation that provides for exclusive jurisdiction of a particular court or tribunal are not arbitrable. Further, they also suggest that matters involving rights in rem are not arbitrable.

Such non-arbitrable matters include the following:

• disputes between landlords and tenants subject to the exclusive jurisdiction of rent courts;
• disputes between financial institutions and borrowers subject to the exclusive jurisdiction of banking courts;
• disputes relating to intellectual property over which IP Tribunals have exclusive jurisdiction; and
• winding up and other proceedings under the Companies Act, 2017, over which the Company Bench of the High Court has exclusive jurisdiction.

Further, courts in Pakistan have held that disputes involving allegations of fraud and other criminal matters or  criminal or public policy matters and any other disputes which a court may in its discretion consider as non-arbitrable.

A domestic arbitral award can be wholly or partially set aside by the court on the grounds that:

• there has been misconduct involving the arbitrator or umpire or the proceedings;
• the award has been made after an order of the court superseding the arbitration or declaring it invalid; or
• the award has been improperly procured or is otherwise invalid

The test for setting aside an arbitral award on the basis of misconduct by the arbitrator is a strict one and courts generally take the view that when parties have agreed to have the matter adjudicated by an arbitrator, they should be bound by their decision. Misconduct is construed strictly and arbitral awards are not set aside upon mere errors of law or fact, unless the same are so glaringly obvious that it may said that the error is “apparent on the face of the award”.

Domestic Arbitrations

The award in a domestic arbitration must be filed before the court of competent jurisdiction for a decree to be drawn up in terms of the award. The decree is then enforceable by means of execution proceedings as a decree of a civil court.

Foreign Arbitrations

In the case of a foreign award, the 2011 Act provides that the person seeking enforcement must file an application for recognition and enforcement before the relevant High Court. That application may only be refused on the grounds stated in article V of the New York Convention. The 2011 Act does not prescribe any procedure for such application. The practice that has been informally adopted is to file an application before the High Court seeking recognition of the award and for the court to issue a decree in terms of the award. That decree may then be executed as any other decree of the court.

Currently, there are no significant proposals for dispute resolution reform.

As a result of COVID-19, the litigation process in Pakistan had been significantly slowed since the courts had been closed for several months during 2020. However, the courts were able to resume normal operations by the end of 2020.