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Fiji Public Trustee Corporation Ltd v Native Land Trust Board [2010] FJHC 486; HBC170.2008 (1 November 2010)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No HBC 170 of 2008

BETWEEN:

FIJI PUBLIC TRUSTEE CORPORATION LIMITED
formerly Public Trustee of Fiji of Level 1, LICI Bldg, Butt Street, Suva.
Plaintiff

AND:

NATIVE LAND TRUST BOARD
a body corporate duly constituted under the Native Land Trust Act, Cap. 134.
Defendant

Judgment of : Ms Dias Wickramasinghe J.

Counsel Appearing : Mr Lagilagi for the Plaintiff
Mr Mataitini for the Defendant

Date of Hearing : 11th August 2010
Date of W/Submissions : 26th August 2010
Date of Judgment : 1st November 2010

INTERLOCUTORY ORDER

Introduction

[1] The Plaintiff by its Summons, seeks a Summary Judgment in terms of Order 14 Rule 1 of the High Court Rules, praying inter alia for $930,008.21 together with interest at the rate of 13.5% from 28th February 2008, against the Defendant.

[2] Defendant is a Statutory Board, endowed with wide powers, duties and special rights relating to the control and administration of native lands in Fiji. By Memorandum of Lease No 14107, dated the 23rd February 1972, the Defendant leased the corpus at Valasi, Nadroga to the lessees, Mani Ram, Tota Ram, Ganga Ram, Daya Ram, and Brij Ram (all sons of Ram Dayal).

[3] On or around 19th January 1984, by Mortgage Deed No. 208199, lessees obtained a loan of $40,000 from the Plaintiff, by providing as collateral their undivided leasehold interest in the corpus. In terms of section 12 of the Natives Land Trust Act, the lessees were required to obtain consent from the Defendant and the Defendant has consented to the execution of the mortgage by its letter of 1st January 1984.

[4] At the hearing both counsel informed court that in 1986 there was a fire where the dwelling in the corpus was destroyed and 2 of the lessees died.

[5] In the event of a destruction to the dwelling, paragraph 9 of the Memorandum of Lease stated above requires the lessees to reconstruct the dwelling within 2 years from the date of such destruction. Parties admit that the lessee had breached this provision and had deserted the corpus.

[6] The Plaintiff submits that, it is entitled to Summary Judgment as the Defendant failed to serve a notice of re -entry under section 57 and 62 of the Land Transfer Act and notify the Plaintiff before making an application for the cancellation of the lease. Plaintiff also alleges that had the Plaintiff been served with the notice of re-entry, it would have taken action to seek relief under section 105 of the Property Law Act, to prevent its loss.

[7] Defendant submits that on 17/6/98, it served a Notice of re-entry by pasting it on a tree in the corpus. The Plaintiff attached a copy of the said notice with its pleading marked exhibit D. On 14/10/99 the lease was cancelled on an application of the Defendant.

[8] The Defendant asserts that the Plaintiff is not entitled to a Summary
Judgment as it has a meritorious defense based on 5 grounds. I will discuss these grounds later on in my order.

Legal Matrix

[9] Order 14 Rule 1 of the High Court Rules provides for a Plaintiff to apply to court for Summary Judgment if the Defendant has no defence on the claim. The said Order reads as follows.

Application by plaintiff for summary judgment (O.14, r.1)

"Where in an action to which this rule applies a statement of claim has been served on a defendant and that defendant has given notice of intention to defend the action, the plaintiff may, on the ground that that defendant has no defence to a claim included in the writ, or to a particular part of such a claim, or has no defence to such a claim or part except as to the amount of any damages claimed, apply to the Court for judgment against that defendant".

[10] In the case of Pemberton v. Chappell [1986] NZCA 112; (1987) 1 N.Z.L.R 1 the learned judges analyzed the extent of the court's power to enter summary judgments, where it was held that:

...the High court rules casts onto the plaintiff the onus of convincing the court that the defendant has no fairly arguable defence. Normally that onus will be satisfied by the plaintiff's affidavit verifying the allegations in the Statement of Claim and his oath that he believes that the defendant has no defence to the claim... If a defence is not evident on the plaintiff's pleading and the defendant wishes to resist summary judgment, the defendant must file an affidavit raising an issue of fact or law and give reasonable particulars of the matters which he claims ought to be put in issue. Where the only arguable ce is #160;a question of hichwhich is clear cut and does not require findings on disputed facts or the ascertainment of further facts, the Court may, and normally should, decide ithe aption for summary mary judgment. But where the defence raiseraises questions of fact on which the outcome of the case may turn it will not often be right to enter summary judgment."

In the case of S. v. Gloucestershire County Council [2000] All E.R. 346 it was held:

"the Court will first need to be satisfiet alat all substantial facts relevant to the allegations of negligence, which are reasonably capable of being before the court, are before the court; that theses are undisputed or that there is no real prospect of succesuccessfully disputing them; and that there is no real prospect of oral evidence affecting the court's assessment of the facts"

[11] In the backdrackdrop of the above guidelines, lenow consider the evid evidence tendered by both the Plaintiff and the Defendant in the instant case to determine whether thintifpplication for a or a summary judgment has merit.

[t the hearingaring, bog, both parties admitted the procedural correctness of filing of documents and supporting affidavits under Order 14. On a perusal of the case record, I am satisfied that laintiff has followed the pthe prerequisites stipulated in Order 14 to make an application for Summary Judgment.

[13] Defendant relies on the following defences.

(a) Plaintiff being advised /notified by letter dated 24th May 1995.[Exhibit 'C']

(b) Re-entry notified in terms of section 24 of the Native Land Trust Act. [Exhibit D]

(c) Duty of the Registrar of Titles in cancelling the Lease.

(d) Surrender of lease in terms of section 62 of Land Transfer Act.

(e) Tenants Loan from Plaintiff is an independent contract.

[14] The defenses stated in (a), (b) and (c) above are inter- woven. I will accordingly proceed to analyze them together.

[15] By its letter dated 24th May 1995 (exhibit 'C'), the Defendant informed the Plaintiff about the incident of fire in 1986 and the Probate and that the Letter of Administration have not been granted to the estate of the deceased lessees. The letter further discloses the address of Brij Ram being one of the lessees. The Defendant requested the Plaintiff to advise the Defendant on the information they have supplied before notices were issued. There is no evidence before me to determine whether the Plaintiff replied the said letter except the assertion of the Defendant in the negative. The Defendant then after a lapse of 3 years, on 17/6/1998 had issued a notice under the heading "To All Whom it May Concern". The said notice informs that the Defendants had forthwith re-entered the land. The heading of the letter also states "Application to cancel lease upon Re-entry by the Lessors. Land Transfer Act (Cap 131) Section 57 Property Law Act (Cap 130) section 105". It is common ground that this notice had been affixed on a tree in the native land.

[16] The Plaintiff thereafter by its letter of 11/02/2003 had informed the Defendant that it was not served with a notice of re-entry but have gathered that an officer of the Defendant had attached a notice on a tree. The said letter further requests the Defendant to return the land to the lessees, as they have plans to develop the land. The letter in the last paragraph states "in this regard we request that you kindly consider Mr Daya Ram's request as well as the interest of the Public Trustee of Fiji as mortgage of the piece of land". The Defendant by its letter of 4/11/2003, refused to reinstate the former lessee and further informed that they had re- leased the corpus. Thereafter, it appears that the Plaintiff has by letter dated 25th May 2004 written to the new developers (copy not provided to court) which had been replied by the new developer on 1st June 2004 informing that the new developers had commenced development operations. The said reply is attached as exhibit 'H' with the Plaintiff's pleadings.

[17] Let me now analyze the effect of the notice attached on a tree, to consider whether it would meet the requirements of sections 57(b) and 62 of the Land Transfer Act as alleged by the Plaintiff and section 24(1) of the Native Land Trust Act.

[18] Duty under section 57

Section 57 (b) of the Land Transfer Act provides:

"unless the re-entry and recovery of possession have been by formal process of law, the Registrar shall require notice of application to register the same to be served on all persons interested under the lease, or, failing such notice, shall give at least one calendar month's notice of the application by publication in the Gazette and in one of the newspapers published and circulating in Fiji before making any entry in the register"

[19] I have considered section 57 (b) along with part X of the Land Transfer Act which stipulates the provisions for 'leases' of Native Lands. Whilst section 57 provides for cancellation of leases by the Registrar, section 62 relates to the surrender of registered lease. The Plaintiff argues that in terms of section 57(b), the Defendant is required to serve Notices on all persons interested under the lease. The Defendant argues that it is the Registrar that is mandated to issue the Notice. I specially consider the words "Registrar shall require notice of application to register the same to be served on all persons" in section 57(b) and finds that it is the Registrar that is tasked to serve the notice and not the Defendant. I am conscious of the fact that in practice, the parties may provide the notices, but nonetheless the notices should be issued under the hand of the Registrar. The exercise of the power by Registrar of Titles under section 57 was dealt at length by Inoke J. in the case of Rapchand Holding ltd v Native Land Trust Board [2001] FJHC 208; HBC 438.2003L (16 June 2010) . I respectfully agree with his observations especially at paragraph 18 thereof. I therefore reject the argument advanced by the Plaintiff that the Defendant had a requirement to serve the notice of re-entry in terms of section 57(b) of the Land Transfer Act.

[20] Duty under section 62 of the Land Transfer Act.

The plaintiff submits that the lease was surrendered by the lessees. Therefore, the Defendant has a duty to obtain the Plaintiff's consent as registered mortgagee before it applied to cancel the lease. I have analyzed section 62 carefully. Firstly, there is no evidence that the Lessees surrendered the lease. In the contrary, the affidavit evidence is that the Lessees abandoned the corpus.

[21] The Laws of England, Vol. 27 [1981] at paragraph 444. p. 349
provides:

"A surrender is a voluntary act of the parties whereby, with the landlord's consent, the tenant surrenders his lease to the landlord so that the lease merges with the reversion and is thus brought to an end. It is defined as being the yielding up of the term of the person who has the immediate estate in reversion in order that, by mutual agreement, the term may merge in reversion. The surrender may be either express that is by an act of the parties having an express intention of effecting surrender, or by operation of law, that is as an inference from the acts of the parties."

[22] The court accordingly concludes that section 62 has no application to this case.

[23] Notice under section 24 of the Native Land Trust Act.

The Defendant submits that the service of the notice dated 17/06/1998 was in compliance to section 24 (1) of the Native Land Trust Act (Cap 134) which reads thus;

"Any application, statement, demand, instrument, notice or other document authorized or required by this Act, or any regulation made thereunder, may be served on the person to whom it is to be given either personally or by leaving it for him at his last known place of abode or by sending it through the post in a registered letter addressed to him there"

[24] Both parties accept that the lessees abandoned the land after the fire incident in 1986. The Memorandum of Lease between the Defendant and the lessees are sequel to the legal rights and statutory obligations created under the Natives Land Trust Act. The notices stated in section 24 above therefore arise only as a consequence of a breach of the agreement between the lessee and the Defendant. Although the Defendant consented to the execution of the mortgage, I am of the view that the statutory obligation under section 12 of the Native Lands Act does not require the Defendant to serve a re-entry notice to the Plaintiff, in the event of breach of its lease conditions with the lessee. In any event the lessees were required to pay off all the installments by 31/03/1991. The Defendant re-entered the corpus only in 1998; 7 years after the date on which the loan should have been paid off by the lessees. During that 7 years Plaintiff had not adduced any evidence before this court to prove that it taken any action to recover the loan monies from the lessees. Instead, the Plaintiff is now attempting to recover the loan money from the Defendant who is discharging a statuary function on a technicality.

[25] The Defendant's obligation is to serve a notice of cancellation of the lease to the lessees. The lessees have abandoned the corpus. In the circumstances, affixing the notice on a tree in the absence of a dwelling at the last known place of abode of the lessees is sufficient compliance of section 24 of the Native Land Trust Act.

Remedial action by Plaintiff

[26] The plaintiff submits that had the notice been served on it, it could have taken action under Section 105 (4) of Property Law Act, (Cap 130) for an order of vesting the whole term of the lease to it. In this process, the Plaintiff states that it could have found ways to sell the lease to recover its debt. The Plaintiff further submits that the location is well known as Coral Coast where many tourist operators are located and it would not be difficult to find a buyer for the mortgage lease. Once again I hold that this is not a tenable argument to make an application for summary judgment when analyzing the manner in which the Plaintiff conducted its business relating to this land. My reasons are as follows.

(a) The deed of Mortgage No 208199 dated 19th January 1984 between the Lessees and the Plaintiff requires the lessees to pay $1200 p.m. commencing from 31st March 1984 and ending 31st March 1991.

(b) According to the payment schedule at annex G of the Plaintiff's pleadings the last payment was made by the lessees on 27th September 1985 and since then the Plaintiff has not taken any action to recover the loan installments.

(c) It appears to me that the Plaintiff finally after 18 years, on 11th February, 2003 decided to write through its legal officer a letter to the Defendant. A careful consideration of the letter indicates that the said letter had also been initiated by the Plaintiff as a result of a discussion the lessees have had with the Plaintiff and in view of lessees' interest to be reinstated in the corpus.

(d) The Defendant re-entered the corpus only in 1999 approximately after 8 years from the last due date of payment. Even after the letter dated 24th May 1995 was written by the Defendant, the plaintiff has not acted diligently to secure its mortgage rights.

(e) I am not hesitant to conclude that the Plaintiff had not taken any steps or any meaningful steps to recover its dues from the lessees. Since the Plaintiff filed the Summons for Summary Judgment simultaneously with the Writ of Summons, the Plaintiff has the onus to prove that the Defendant has no defence.

(f) The payment schedule at Exhibit G also depicts payment installments for insurance. The Plaintiff's pleadings are silent as to whether the Plaintiff has recovered any sum from insurance. I also note that although the affidavit evidence of the Plaintiff states that the Defendant was loaned $40,000 the payment schedule G discloses the sum lent as $33,000.

(g) In the circumstances, I am unable to accept the Plaintiff's assertion that it could have acted in terms of section 105(4) to protect its rights.

[27] On the foregoing I conclude that the Defendant has not breached the provisions of section 57(2) and 62 of the Land Transfer Act. I am satisfied that the Defendant has defences on the merits and concludes that the Defendant in fact has triable issues to be determined by the court.

Accordingly, I dismiss the application of the Plaintiff for summary judgment.

ORDERS

Plaintiff's application for Summary Judgment dismissed. Considering the nature of the case I do not order costs.

Ms. D. Dias Wickramasinghe
JUDGE