Khaitan Sud & Partners (KSP) is facing a recovery suit in the Saket district court, Delhi, filed by its former senior associate Pankaj Kumar for the arrears of his retainership fee.

The court issued summons to KSP, its managing partner UK Khaitan and its partners Ashutosh Khaitan, Malini Sud and Tanuj Sud a week ago on Tuesday for Kumar’s Rs 1,87,811 (Rs 1.87 lakh) claim against the firm.

Kumar, who was a senior associate in KSP’s motor accidents vertical which was dissolved in February 2014, has claimed the amount against one month’s retainership fee (Rs 72,000), five months’ mobile bill reimbursement (Rs 6,923), the unpaid portion of his annual bonus for the year 2013 (Rs 49,518), compensation for mental agony due to delay in payment (Rs 50,000) and the cost of litigating this recovery suit (Rs 10,000).

Kumar said he had been chasing the payment of his arrears through emails addressed to Ashutosh Khaitan, since 9 July 2014 – which was more than two months after he left the firm. After an exchange of eight emails between him and Khaitan from 9 July to 22 December 2014, Kumar served a legal notice on the firm.

Kumar claimed that Ashutosh Khaitan had assured to him twice, through email, that his dues would be cleared by a specific date but the dues have allegedly remained pending to date.

KSP managing partner UK Khaitan told Legally India that the firm had cleared Kumar's dues and declined to comment further.

Complete shock

UK Khaitan had commented to Legally India in Februrary last year that the decision to wind up the motor accidents vertical was a result of the management “soul searching” and the motor accidents vertical team realising that to close the practice down “might be a good idea”.

Kumar told Legally India last week that a notice of around 10 days was given to the practice team and clients, in late March 2014, to return clients’ files and look for new jobs.

“No assistance or no notice period was ever given to any team members to find out new jobs. One of the team member Pritish Sirkar (then assosiate) was informed that he has been retained but he got surprise on around 28th March that even he cannot be retained. The situation was extremely worse,” he commented.

Kumar wrote in his plaint that “this was a complete shock for the Plaintiff as well as for other team members of insurance team as the career of the Plaintiff got stalled in dark”.

Kumar told Legally India that around 15 insurance companies, which comprise almost the entire insurance sector in India, were the exclusive clients of the firm’s motor accidents practice at the time. He said that most of them were not ready to take back their files from KSP because it was not possible for them to find new legal advisors in Delhi and north India at such short notice.

It was for this reason that KSP allegedly “forced” Kumar to stay at the firm for another month at half his original retainership fee, he said. He claimed in his petition that his retainership fee for March was released to him on the condition that he would continue with the firm for the month of April, performing his usual duties, and be paid Rs 36,000 instead of Rs 72,000. Left with little choice in the matter Kumar agreed to this condition and signed an undertaking to do so.

He told Legally India that the firm had reasoned that because he had to handle a lesser number of clients during April 2014, than usual, Kumar’s retainership fee was reduced to half for that month.

The practice head for the vertical, Ashutosh Singh, left the firm before Kumar. In the team of five lawyers under Singh, three were associates and Kumar and another lawyer Navneet Singh were senior associates.

One associate was absorbed into a different practice at KSP while the other three left the firm in March.

Previous hardships

Kumar alleges that delays in payments from the firms to him began merely “a few months” after he had joined the firm on 23 April 2013. He alleges further that the firm had started “pressurising” him to “add more clients” and bring in revenues up to three times his retainer, around this time.

He states in his plaint:

“For the month of December 2013, against the retainership fee of Rs 72,000 the Defendants paid only a sum of Rs 28,350 and that too on 20.01.2014. On being asked about the rest of the amount the Defendants assured the payment of the remaining amount along with the retainership fee of January 2014. However even for the month of January 2014 the Defendant did not made any payment.”

“During that time the Plaintiff was continuously attending the courts and was incurring all day to day expenses including traveling and ancillary litigation expenses from his own pocket just to save the interest of clients of the firm. The Plaintiff was continuously making oral requests to the Defendants specially Defendant No. 2 and 3 for payment of dues. However in turn Plaintiff consistently received only false promises and assurances which was sheer delaying tactics of the Defendants with malafide intention not to pay the amount.”

He does add later in the plaint: “In the month of March 2014 after causing extreme mental hardships the Plaintiff received remaining retainership fee for the month of December and full fees of January and February in the form of cash.”

Kumar has filed the suit through advocate Deepak Agarwal and the summons on KSP are returnable by 18 September.

Photo by Evan Jackson