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Blue Latitude Ltd v Sharma [2013] FJHC 573; Civil Appeal 06.2012 (30 October 2013)

IN THE HIGH COURT OF FIJI
AT SUVA
APPELLATE JURISDICTION

Civil Appeal No. 6 of 2012

BETWEEN:

Blue Latitude Limited and Nicobar Limited
APPELLANTS

AND:

Jitendra Deo Sharma
RESPONDENT

COUNSEL : Mr. Sharma D for the Appellants
Mr. Singh A for the Respondent

Date of Judgment : 30 October 2013

JUDGMENT

1. This appeal is against the dismissal of the proceedings brought by originating summons issued pursuant to S.169 of the Land Transfer Act.
   
2. The Appellants seek following orders in his Notice of Appeal:
   

[i] "That the Final Ruling of the High Court delivered on 31 January 2012 by Master Deepthi Amartunga dismissing the Appellant's Section 169 Summons and refusing the grant of vacant possession against the Respondent be set aside and or to be submitted by such other Order or Orders as this Honourable Court deems just and expedient.

[ii] That the Court do order the Respondent to give immediate vacant possession of that part of the property in Certificate of Title No. Vol. 44 Folio 4341 currently occupied by the Respondent and his family to the Appellants.

[iii] Together with the costs in the Honourable High Court be paid by the Respondent and such further or other Orders as this Honourable Court deem fit, just and expedient."

3. The Appellants appeal to this court on the following grounds of appeal:
   
   1. That the Master erred in fact and in law in not taking into account the fact that the Respondent's father only had a tenancy on the land that could be terminated by six months notice.
      
   2. That the Master erred in fact and in law by seeking to create for the Respondent a right in equity when the Respondent could not acquire a greater right in the land than his late father.
      
   3. That the Master erred in fact and in law in holding that the Respondent had made or incurred substantial improvements on the property when in fact the Respondent's affidavits did not contain any independent corroborative evidence of such alleged improvements or costs of improvements.
      
   4. That the Master erred in fact and in law in not considering the fact that as against the Appellants the Respondent had no right in law or in equity to have a claim against the land and that the Respondent had not taken any steps to seek any interest or claim in the land against the previous registered proprietors.
      
   5. That the Master erred in fact and in law in not taking into account or giving due consideration and weight to the fact that even though the Respondent had previously sought to register a caveat against Certificate of Title Vo. 44 Folio 4341 in 1996 he did not pursue any claim against the said Title and his caveat was cancelled.
      
   6. That the Master erred in fact and in law in holding that the Respondent had a mistaken belief about his rights in the land when there was no evidence of any such mistaken belief that was pleaded by the Respondent and that there was clear uncontradicted evidence that the Respondent knew that at best he had greater interest in the land than his late father Ram Pati Maharaj who was a tenant on the said property.
      
   7. That the Master erred in fact and in law in not giving any or due consideration to paragraph 9 of the Respondent's Affidavit deposed on 14 July 2011 or the annexure that were marked as JP1,JP2, JP3, JP4 and JP5 that showed that there was no mistaken belief by the Respondent about his rights in the land.
      
   8. That the Master erred in fact and in law in not giving any or due consideration to the inconsistent claims made by the Respondent especially in paragraph 13 of the Respondent's Affidavit deposed on 14 July 2011 and his later assertions where in one affidavit he claimed that the house was constructed for $30,000.00 and then he produced two documents whereby he claimed that the house was worth over $70,000.00.
      
   9. That the Master erred in fact and in law in not giving any or due consideration to the claims made by the Respondent especially in paragraph 14 of the Respondent's Affidavit deposed on 14 July 2011 where he claimed wages for looking after the land since 1963 and also sought to claim land rates for the years 1967 to 2008.
      
   10. That the Master erred in fact and in law in not giving any or due consideration to the claims made by the Respondent especially in paragraph 15 of the Respondent's Affidavit deposed on 14 July 2011 where he acknowledged the ownership rights of the previous owners.
       
   11. That the Master erred in fact and in law in holding that previous registered owners of land in question had somehow acquiesced in the Respondent's occupation when in fact the Respondent had not obtained any express written authority from the previous owners to do any construction on the land or to carry out any other improvements on the land.
       
   12. That the Master erred in fact and in law in assuming that the Respondent had constructed a road and carried out drainage works on the land when there was no independent evidence that anything of that sort had been carried out by the Respondent.
       
   13. That the Master erred in fact and in law in not giving any weight to the fact that the Respondent had derived substantial benefits from the land as well during his tenure in being able to stay on the land without paying rental for the period of his occupation.
       
   14. That the Master erred in fact and in law in not giving any weight to the fact that the Respondent had not in his affidavit or through his exhibits fulfilled the test for equitable interest in the land and neither had he depose to the facts to satisfy all four limbs of the test. What the Master did was create a situation out of his own perception of facts to fulfill the test for equitable interest.
       
   15. That the Master erred in fact and in law in not giving any weight to the fact that the Respondent had failed to produce any document or evidence from the Navua Rural Local Authority to show that the two dwelling houses constructed on the land had been done with proper building permits to make them legal structures. At the same time the Respondent had sought to claim land rates, presumably that he allegedly paid to the Navua Rural Local Authority.
       
   16. That the Master erred in fact and in law in not giving any weight to the fact that the Respondent's Counsel had admitted in Court that the Respondent did not have any requisite building or completion permits or approval from the Navua Rural Local Authority to construct dwelling houses.
       

Facts Briefly

4. The Appellant's by its affidavit of Andre Grant Bennison, Director of the Plaintiff company sworn on 24 May 2011, deposed that the Plaintiffs are the last registered proprietors of all that land comprised and described in certification of title Vol: 44 folio 4341 "Qaributa West" situated at Navua in Fiji containing an area of none a less 285 acres: 1 rood, 25 perches.
   
5. The Appellant further deposed that the Defendant and his family members are unlawfully and without any colour of right occupying part of the said property. The solicitors for the Appellant issued notice to the Defendant to vacate the said property within 30 days from the date of service which the Defendant has failed to do so.
   
6. The Respondent in his affidavit sworn on 14 July 2011 deposed that he believed that he had acquired an equitable interest in the land.
   
7. In his affidavit he admitted the following facts:
   
   1. Appellants were the last registered proprietors of the land in CT Vol 44 folio 4341.
      
   2. The property was previously owned by Leonard Simpson, Sydney Simpson and Douglas Simpson.
      
   3. He admitted that his father had a tenancy agreement with the owners of the land and annexed a letter from the previous owners representative, S Gould & Co, which states that Respondent's father was entitled to live on the land provided that he paid rental and was subject eviction if he was noticed to quit.
      
   4. In the document annexed as JP2, dated 6 December 1963 where it was stated that his father claimed, that he was a tenant on the land and volunteered to act as the agent of the owners of the land.
      
   5. In the document annexed as JP3, a person by the name of Bhuwan Dutt wrote to the owners of the land and acknowledged that the Respondent's father was a tenant of the owners.
      
   6. In the document annexed as JP4, where the Respondent wrote to the previous owner on 4 October 1993, and stated that his father had left him the property in his will. In this matter the Respondent wanted an authority to say that he was acting as an agent of the owners of the property.
      
   7. In the document annexed as JP5, the Respondent wrote to the previous owner, on 30 September 1994, and stated that he wanted an authority from the owners to act on their behalf to proceed with the matter reported to the police.
      
8. He further deposed after his father's death in 1998, he developed the land and build his own house on the land on the premise that he inherited his father's estate. He also said that he has spent $50,000.00 to build as a house and $30,000.00 for drainage constructed power poles, constructed gravel road, run water pipes, and leveled the land to convert into a farm. Respondent also submitted photographs and valuation report to support his position.
   

The Determination

9. The issue of determination of this court is to ascertain whether the Respondent had shown cause as to why an order for vacant possession should not be made against him on the material submitted in his affidavit.
   
10. Section 172 of the Land Transfer Act states that:
    

"if a person summoned appears he may show cause why he refuses to give possession of such land and, if he proves to the satisfaction of the judge a right to the possession of the land, the judge shall dismiss the summons with costs against the proprietor... and he may make any order and impose any terms he may thing fit: provided that the dismissal of the summons shall not prejudice the right of the Plaintiff to take any other proceedings against the person summoned to which he may be otherwise entitled..."

11. The Respondent in his affidavit dated 14 July 2011 deposed that he had acquired an equitable interest in the land on the premise that he had made improvements to the land at his own costs and the tenure of his occupations. The learned Master dismissed the summons of the Appellants on the basis that the Respondent had adduced some arguable grounds to remain in occupation of the land under the principles of proprietary estoppel.
    
12. The Plaintiffs indisputably the last registered proprietor of the land. In terms of Section 169 (1) of the Land Transfer Act, the last registered proprietor is entitled to bring summary proceedings for vacant possession.
    
13. The Respondent's Defence was that the Plaintiffs are estopped from evicting him, as he has adduced arguable grounds under principles of proprietary estoppel.
    
14. The Supreme Court in Morris Hestrom v Liaquat Ali [Action No. 153/87 at page 2] stated the requirements of Section 172 as follows:
    

"Under Section 172 the person summoned may show why he refused to give possession of the land and if he proves to the satisfaction of the judge a right to possession or can establish an arguable defence the application will be dismissed with costs in his favour. The Defendants must show on affidavit evidence some right to possession which would preclude the granting of an order for possession under Section 169 procedure. That is not to say that final or incontrovertible proof of a right to remain in possession must be adduced. What is required is that some tangible evidence establishing a right or supporting an arguable case for such a right, must be adduced."

15. Snell's Equity 29the Ed, page 573-575 provides:
    

"Proprietary estoppels are one of the qualifications to the general rule that a person who spends money on improving the property of another has no claim to reimbursement or to any proprietary interest in the property..."

White J in Denny v Jensen [ 1977] 1 NZLR 635 at page 638, enunciated the following four conditions that must be satisfied before proprietary estoppels applied viz, there must be:

1. An expenditure.
   
2. A mistaken belief.
   

100. A conscious silence on the part of the owner of the land, and
     

4. No bar to the equity."
   

16. The Appellants submit that there was not sufficient evidence to satisfy any of the four limbs of the proprietary test.
    

[A] Expenditure

17. It is to be noted that the Respondent has adduced some evidence to demonstrate to this court that he has made some improvements to the land in question although such expenditure was for the benefit of the Respondent and not for the owners of the land. The issue to be dealt with is whether such expenditure gives rise to create any right to the land and continuation in possession.
    
18. The evidence adduced by both parties to this appeal, clearly demonstrate that the Respondent's father was a tenant of the land and the Respondent's continuation in possession remains because of his late father. This Respondent was very well aware that he was required to vacate the land if he was given a notice to quit.
    
19. It was also evidenced that the Respondent wrote letters to the Appellants requesting to be the agent of the Appellants. It is also noted that no evidence was produced to establish that he obtained any consent from the owners to build a dwelling on the land or to make any improvement.
    
20. In the case of Chand v Ali HBC 0116 of 2004 Justice Winter said the following:
    

"Turning to ground (c ) counsel submits that issues of compensation from improvements cannot justify continual occupation of a property. Again counsel very helpfully produced a decision of Ram Chand v Ram Chandar, Appeal No. ABU0021.2002S and 0022.2002S and refer to pages 13 and 15 where the Fiji Court of Appeal observed that the mere fact that a tenant carries out improvements without the consent of his or her landlord does not give him a right to continue occupation of the land if the landlord is otherwise lawfully entitled to it. The fact that improvements are made is not really an answer to a landlord's 169 application for possession.

21. In the case of Chand & Ors v Chandar ABU 0021S of 2002 the Fiji Court of Appeal when dealing with the issue of a tenant who had made improvements to the property, held:
    

"On 11 July 2011 the respondent, Mr Chandar swore an affidavit. He said that he had been in occupation of the subject land for a period of 59 years. He said that he had been advised:by the registered proprietors'" that if carried out improvements to the property, he would be given an opportunity to purchase the land "for a nominal sum" and could otherwise remain on the land as long as he wanted in consideration of the improvements later mentioned in the affidavit. He said that a number of improvements had been carried out and listed what they were. The list is as follows:

4.1 Constructing road, digging drains and clearing bushes on the land.

4.2 Cultivating the land into farm lots.

4.3 Arranging for electricity to be installed and telephones.

4.4 Expenditure totaling some $110,500.00.

The court further held in the judgment:

In relation to paragraph 1, the fact that a tenant carries out improvements without the consent of his or her landlord does not give him a right to continue in the occupation of the land if the landlord is otherwise lawfully entitled to it. On the other hand, if improvements are carried out pursuant to some understanding, however loose, it may be that in some cases rights will be conferred on tenants at least to purchase the land if a price can be agreed upon. One cannot lay down any hard and fast rule. Every case will depend upon its own facts."

22. It is observed that there was no consent, promise or undertaking of any nature in the instant case before this court as per the affidavit of the Respondent.
    
23. In my view, the Court of Appeal in the case of Chand v Chander had dealt with the similar situation where improvements had been made by the tenant and the court held such improvements does not justify as a basis for continuation in possession of the land.
    

[B] Mistaken Belief

24. In order to satisfy the court on this limb, the onus is on the Respondent to prove that he had some sort of genuine belief that he owned the land he was living or had ownership rights to the land.
    
25. It is evidently clear that the Respondent's father was the tenant of the land. The documents annexed to the affidavit of the Respondent also clearly demonstrate that he made an attempt to be the owners agent but did not get even such authority from the owners. The documents further reveal that the Respondent and his father accepted the Appellants as the owners of the land. Hence, I conclude that there was no evidence before the court that the Respondent held any genuine belief that he had ownership right in the land.
    
26. It follows that the Respondent had no "belief either that he already owned a sufficient interest in the property to justify the expenditure or that he would obtain such an interest...." and therefore "has no equity in respect of his expenditure" – Snells Equity, (op cit) .
    

[C] Conscious Silence

27. Conscious silence implies that there was knowledge on the part of the owners of the land that the person who was occupying the land was incurring expenditure and the owners had done nothing to stop him from doing so.
    
28. It was evident in the affidavits that the previous owners had clearly told that Respondent's father that he could live on the land as a tenant and would be required to vacate the land if he was given notice to quit.
    
29. It was also further evident in affidavit of the Respondent that one of the previous owner's grand children in 1996 had tried to evict him from the land. The onus is on the Respondent to prove that the Appellant knew about the building of the house and took no steps to prevent the Respondent incurring such expenditure.
    
30. There was no evidence adduced by the Respondent that he sought consent to build on the land or incur expenditure.
    

No Bar to Equity

31. It is clear in the affidavit of the Respondent that the structures built by him did not have building permits, consents or approval from the Navua Rural Land Authority.
    
32. In the case of Tuidama v Prasad [2011] HBC 508 of 2007, Mutunayagum J held:
    

"Snell's Equity, 29 Ed, page 576 provides that "No equity will arise if to enforce the right claimed would contravene some statute."

Section 59 (d) of the Indemnity, Guarantee and Bailment Act (Chapter 232), which so far as material to these proceedings provides:

'No action shall be brought

(d) upon any contract or sale of lands, tenements or hereditaments or any interest in or concerning them unless the agreement upon which such action is to be brought or some memorandum or note thereof is writing."

The Defendant had not complied with the above provision in that there was no sale and purchase agreement entered into.

I hold that the Defendant has failed to prove to the satisfaction of the Court the necessary premises of fact in order to found an application of the equitable doctrine of propriety estoppels.

The Plaintiff and Defendant in their written submissions, have cited the case of Deo V Mat, (2005 FJHC 136). In this case, the Court had granted the registered proprietors of the land vacant possession of the land as it was found that the Defendant, who had built a house therein, was unlawfully on the property.

33. The Town Planning Act restricts any development on a land unless proper consents have been obtained from a local Authority i.e.
    

Restriction on carrying out of development after constitution of town planning areas:

7.-(1) Subject to the provisions of this section, the permission of the local authority shall be required in respect of any development of land carried out within a town planning area during the period before a scheme affecting such area has been finally approved.

(2). The use for the display of advertisements of any external part of a building which has not normally been used for that purpose shall be treated for the purpose of this section as involving a material change in the use of that part of the building.

(3). The local authority shall not grant or refuse permission under this section without the prior consent of the Director and the Director may approve such grant or refusal either unconditionally or subject to conditions and may prohibit such grant of refusal. (Substituted by 14 of 1961, s.4).

(4). In dealing with applications for permission to develop land under this section, the local authority and the Director shall have regard to the matters set out in the Schedule, to provisions proposed to be included in a scheme and to any other material considerations.

(5.) Regulations may be made by the Minister prescribing matters relating to the control of development under this section, and in particular, without prejudice to the generality of the foregoing, scheduling any development or development of any class, in respect of which permission under this section shall be deemed to be granted by the regulations themselves.

(6). Where any development of land has been carried out without the grant of permission required in that behalf under this section, or any conditions subject to which permission was granted under this section have not been complied with, the local authority may at any time, and at the cost of the person in default, take such steps as may be required for restoring the land to its condition before the development took place, or for securing compliance with the conditions as the case may be, and any expenses lawfully incurred by the local authority in so doing may be recovered as a civil debt.

(7). Every person who:

(a) carries out any development of land without the grant of permission required in that behalf under the provisions of this section; or

(b) contravenes or fails to comply with any conditions subject to which permission has been granted under the provisions of this section; or

(c) obstructs or interferes with the exercise by the local authority of the powers vested in it by the provisions of this section,

shall, in addition to any civil liability, be guilty of an offence and be liable on conviction to a fine not exceeding one hundred dollars or to imprisonment for a period not exceeding three months; and if such contravention, failure to comply, obstruction or interference is continued after the conviction, he shall be guilty of a further offence and liable on conviction to a fine not exceeding twenty dollars for every day on which the contravention, failure to comply, obstruction or interference is so continued. (Section substituted by 22 of 1958, s 3, and amended by 37 of 1966, s.27.)

34. In view of the above provisions of the law and the reasons stated in the Tuidama v Prasad's case I am of the view that the Respondent has not satisfied the forth limb of the Proprietary Test.
    
35. The counsel for the Respondent submitted that the failure to collect the rent from the Respondent amounts to abandoning the property by the Appellant and further submitted that by conduct the current owners are estopped in claiming the property. In the instant case, there was no such evidence.
    
36. There mere inaction on the party of the Appellants to collect the required rent agreed between the parties does not necessarily change the status of the Respondent. In my view there should be some evidence before the court to establish that the status of tenant changed during the period of occupation of the land.
    
37. Although the counsel for the Defendant submitted that the Respondent continued in possession adverse to the rights of the Appellant and there was no protest whatsoever during the period of tenancy the fact that there was an attempt by the grand children of the owners to evict the Respondent from the land, and the no attempt was made by the Respondents to restore or pursue his caveat after it was discharged established, otherwise.
    
38. The counsel for the Respondent also relied on the case of Australian Conference Association Limited v Sela [2001] FJHC 62, Civil Action 0357 at 2005 (31 January 2007) (unreported) to establish the right to remain in possession. Counsel brought to notice of the court to the paragraph 31 of the said judgment to support his assertion. Paragraph 31 of the judgment states:
    

"The issues of promissory estoppels and equitable estoppels were discussed in the High Court of Australia in the case of Waltons Store (Interstate) Limited v Maher and Another, 164 C.L.R. p. 387. The headnote at p.388 reads as follows: (the title 'plaintiff' and 'defendant' should be exchanged for the purposed of this case before me):

"Per Brennan J, To establish an equitable estoppels it is necessary for a plaintiff to prove that:

(i) The Plaintiff assumed that a particular legal relationship than existed between him and the defendant or expected that a particular relationship would exist between them and, in a latter case, that the defendant would not be free to withdraw from the expected legal relationship

(ii) The defendant induced the plaintiff to adopt that assumption or expectation

(iii) The plaintiff acts or abstains from acting in reliance on the assumption or expectation

(iv) (The defendant knew or intended him to do so)

(v) The plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled

(vi) The defendant has failed to avoid that detriment whether by fulfilling the assumption or expectation or otherwise.

For the purpose of the second element, a defendant who has not actively induced the plaintiff to adopt the assumption or expectation will be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights or an increase in his obligations and knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, he failed to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs."

39. However, it is observed that, in the same judgment in paragraph 37 court
    considered the basis on which the tenants came in to possession of the land.
    

"On the basis of these cases and given the peculiar factual history of this case it would be inequitable to do other than the plaintiffs are stopped from removing the defendants from the land.

The forebears of the defendants and the descendant defendants came on to or are on the land in the belief and on the assumption that it was lawful so to do and with the expectation that they could stay there in perpetuity. They have continued to occupy the land on this assumption and with that expectation."

40. Upon perusal of the judgment and the facts and circumstances of the instant case before me I am of the view that rationale established in the above judgment is distinguishable on the premise inter-alia that the Respondent's father's came into occupation as a tenant subject to eviction on notice and further requested to be agent of the owners and thereby accepting the ownership of the Appellant in their own documents annexed to the affidavit.
    
41. I have considered the Ground 1, 2, 3, 7, 8, 11 and 12 under the heading of Expenditure, Ground 5 and 6 under the heading of Mistaken Belief, Ground 10, under the heading Conscious Silence and Ground 14 and 15 under No Bar to Equity in my judgment.
    

Orders of the Court

42. The appeal of the Appellant is allowed and the decision of the Master is set aside.
    

Orders of Court

43. The Respondent must vacate the subject property within 60 days from this judgment.
    
44. The Respondent shall pay the Appellants costs in a sum of $1,500.00.
    

Susantha N. Balapatabendi
JUDGE