Home | Databases | WorldLII | Search | Feedback High Court of Fiji

NBF Asset Management Bank v Taveuni Estates Ltd [2009] FJHC 1; HBC245.2008 (13 January 2009)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO.: HBC 245 OF 2008

BETWEEN:

NBF ASSET MANAGEMENT BANK
Plaintiff

AND:

TAVEUNI ESTATES LIMITED
First Defendant

THE REGISTRAR OF TITLES
Second Defendant

Mr. J. Oswald-Jacobs for Plaintiff
Mr. R. Naidu for First Defendant
No Appearance for Second Defendant

Date of Hearing: 12th September 2008
Date of Ruling: 13th January 2009

DECISION ON EXTENSION OF CAVEAT

[1] This is an application for extension of seven caveats over seven different titles as follows:

(a) Caveat No. 557990 registered in Certificate of Title Number 28314;
(b) Caveat No. 557990 registered in Certificate of Title Number 28373;
(c) Caveat No. 557990 registered in Certificate of Title Number 28390;
(d) Caveat No. 557990 registered in Certificate in Title Number 28439;
(e) Caveat No. 557990 registered in Certificate of Title Number 28442;
(f) Caveat No. 557990 registered in Certificate of Title Number 28330;
(g) Caveat No. 202716 registered in Certificate of Title Number 22138.

I was told from the bar table that caveat number 202716 over CT 22138 had been withdrawn on the morning of the hearing so it was no longer an issue before the court.

Basis of claim – deed of conveyance:

[2] The first defendant is the registered proprietor of the above titles. The plaintiff had lodged caveats against the title. It received notices to withdraw the caveats from the Registrar of Titles pursuant to Section 110 of the Land Transfer Act Cap 131. Hence it made an application to for extension of caveats. It relies on a deed of conveyance dated 2nd June 1995 made between the first defendant and the plaintiff to show a beneficial interest in the six titles. Clause 13 of the Deed of Conveyance provides:

"Notwithstanding any other provisions of this deed, the parties hereby agree to the following:

(a) that the 40 certificates of titles numbers annexed hereto as annexure 4 may have been fully paid. In the event that evidence is produced of full payment, each such lot for which evidence is not produced will form part of this transaction."

(b) that in the event that there are any titles that are unencumbered, such titles shall be made available for transfer on a title for title basis to the Transferees herein in substitution for those in (a) for which evidence of full payment is provided.

(c) that the matters mentioned in (a) and (b) above must be resolved within ten days of the date of this deed."

Included in the 40 certificates of title are the six which are subject matter of this application. The deed of conveyance including the six titles are subject matter of litigation in HBC 543 of 2004 between the parties in particular the fifth cause of action in the statement of claim.

Grounds of objection:

[3] The first defendant’s main basis of objection to extension is that the issue of six titles was sorted out. He submits that in 1995 the defendant had agreed to withdraw the caveats and is now estopped from claiming a caveatable interest. He is relying on letters written by Chan Law on behalf of the first defendant.

Principles of extension:

[4] The principles involved in extension of caveat are usefully summed up in Catchpole v. Burke – (1974) 1 NZLR 620 at page 625 as follows:

"when it is plain to the court that the caveator cannot possibly succeed in establishing his claim against the registered proprietor it is proper to refuse to extend the caveat ..... But where there are doubts surrounding the rights of the caveator ..... the proper course is to extend the caveat until the conflicting claims of the different parties are determined in action brought for that purpose."

[5] One can hardly deny that under Clause 13 of the Deed the plaintiff had a caveatable interest.

Was there a concluded agreement to withdraw caveats?

[6] Mr. Naidu submits that there was an agreement to withdraw caveats. That is what he has to establish if he is to show that the caveator (the plaintiff) cannot possibly succeed. He is relying on a letter dated 7th December 2005 annexed to the affidavit of Juris Gublis sworn on 10th August 2008. The text of the letter reads:

"Mr. Mohammed Afzal Khan

Messrs Khan & Co

Barristers & Solicitors

Suites 8 & 9, 1st Floor

Victoria Parade

SUVA

Dear Sir,

Re: Taveuni Estates Limited –v- NBF Asset Management Bank,

Marie Chan & Ors – High Court Civil Action No. HBC 452/05S

We refer to your conference with Mr Vipul Mishra on 29 November 2005 in respect of caveats on the 40 titles subject to clause 13 of the Deed of Conveyance. As requested by Mr. Mishra, we enclose copies of lodgment slips for withdrawal of caveats, lodged on 16 September 2005. The delay in canceling the memorandum on the titles is from the Registrar of titles’ office.

Yours sincerely,

{Sgd:}

Marie A Chan

Encl."

The above letter does not spell out a complete version of events. The details of conference are not there. However, there is other correspondence between the solicitors for the parties. These letters are annexed to the answering affidavit of Ambika Prasad sworn on 5th September 2008. Of significance is the letter dated 4th November 2005. It states that any meaningful discussion or settlement can only be achieved if three conditions were satisfied. These were:

"1) Unconditional withdrawal of High Court Civil Action No. HBC 542/05S.

2) Executing transfer for CT Nos. 28335, 28336 and 28414 and return to us, sent to you under cover of our letter of 8 September 2005.

3) Messrs Cromptons to remove caveats placed by Nasau Limited on the golf course Caveat No. 551371 and 551370A on Certificate of Title 28420 and 28574."

[7] If the conditions are not met, then there can be no concluded agreement. I have looked at correspondence between the parties. It does not demonstrate a concluded agreement between the parties. The plaintiff’s claim in civil action 543 of 2004 is that it is entitled to 40 certificates of title. Whether it succeeds or not, only the trial will tell. It is not a claim which I can say is doomed to fail. Accordingly this ground of objection fails.

Procedural objections to summons:

[8] Mr. Naidu also raised certain procedural matters. He submitted that since the application did not come by way of an originating process, I should dismiss it. Section 110 of the Land Transfer Act provides for this procedure for extension. In any event order 2 of the High Court Rules deals with effect of non-compliance. It is designed to ameliorate the harshness of nullifying proceedings simply because a party may have chosen a wrong procedure. There has been no prejudice caused to the first defendant. It was aware of the case it has to meet. Hence this ground fails.

[9] Mr. Naidu also submitted that since there is no undertaking as to damages, I should refuse to extend the caveat. Obviously the defendant will remain the registered proprietor until the resolution of civil action 543 of 2000. One must not lose sight of the fact that both a caveat and its extension are statutory remedies available to party. Under it a caveator can protect his interest on an interim basis without having to persuade the court of serious issues or balance of convenience or give undertakings as to damages. The test is as in Catchpole and which was applied in Lee v. Waikalou Developments Limited – HBC 294 of 1995; (2002) FJHC 17.

[10] The overall justice of the case requires that I extend the caveat as otherwise the first defendant could sell the properties and deprive the plaintiff of its rights under the Deed.

[11] The judgment was ready for delivery on 18th September 2008. Prior to delivery, counsels told me that the initial caveats lodged by the plaintiffs over six properties comprised in Certificates of Titles 28314, 28373, 28390, 28439, 28442 and 28330 had not been signed by the Registrar. Counsels wanted to address the court whether the failure of the Registrar to sign on the memorial of the caveat rendered the caveat ineffective and therefore there could be no extension.

[12] The plaintiff submitted that Section 24 of the Land Transfer Act required that every memorial entered in the register "shall be signed by the Registrar". The requirement is mandatory. He further relied on Section 37 of the Act to submit that unless registered, an instrument is not effectual to create any encumberance or pass any estate or interest. However, a caveat does not create an encumberance or pass any estate or interest. It only serves as a notice of a claimed interest.

[13] A Registrar has a duty, not discretion, to file a caveat once it is in proper form with details as to name, address of caveator and place for service of notices as shown. He may not refuse to file a caveat on the basis that he believes that the claim asserted is invalid. The validity or otherwise of the claim is for the court to decide, after and not before, the caveat is filed or lodged. A caveat is simply a notice of a claim which may or may not be a valid claim: Kampta Prasad v. Home Finance Co. Ltd. v. Rajendra Singh – 2003 FJHC 322.

[14] Justice Jitoko in Kampta Prasad was further of the view that a caveat is lodged not registered and it gains effect from the mere act of lodgment at the Titles Office. I agree with the view expressed by Justice Jitoko because a mere lodging of a caveat acts no more than warning to those who search a title and also serves as a notice to the Registrar. By themselves caveats create no interest in the land. Part 17 of the Land Transfer Act dealing with the caveats serves as a code in itself to facilitate the purpose of caveats.

[15] There is no suggestion in the present case that the caveat was not in proper form. I agree with plaintiff’s submission that the caveats here were effective in practical terms. Its existence was noted in the title even though unsigned by the Registrar. The defendant treated the caveat as effective and that is why it sought its removal. The problem of unsigned caveat had not been raised.

[16] All that has not been done is the Registrar has omitted to carry out an administrative act of a signature. Exercising my powers under Section 168 of the Land Transfer Act I order the Registrar to sign the memorial on the titles.

Final Orders:

[17] Accordingly I extend the six caveats until the disposal of the civil action 543 of 2004. I also order the Registrar to sign the memorial on the titles. I order costs against the first defendant in favour of the plaintiff summarily fixed in the sum of $500.00 to be paid in fourteen (14) days.

[Jiten Singh]
JUDGE

At Suva
13th January 2009