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Kumakana v Vilaka [2025] SBHC 60; HCSI-CC 129 of 2022 (9 May 2025)

HIGH COURT OF SOLOMON ISLANDS

IN THE HIGH COURT OF SOLOMON ISLANDS
CIVIL JURISDICTION

Civil Case No. 129 of 2022

BETWEEN

MORRIS KUMAKANA
Claimant

AND:

ALFRED VILAKA
Defendant

Date of Hearing: 12 March 2025 and 24 April 2025

Counsel
Mr N Sariki for Claimant/Counter Defendant
Mr J Kaboke for the Defendant/Counter Claimant

Lawry; PJ

JUDGMENT

1. In Claimant and the Defendant are cousin brothers. In 2002 the two of them entered into an agreement whereby the Defendant agreed to sell the fixed term estate parcel number 098-012-286 to the Claimant. The purchase price agreed upon was $10,000.00.

The Claim

2. At the time of the agreement the Defendant did not own the land but expected title to be transferred to him by the Commissioner of Lands.
3. The terms of the agreement between the Claimant and the Defendant were recorded in writing in a declaration prepared by the Defendant and signed by both parties. That declaration was date 24 December 2002 and was in the following terms.

“DECLARATION

I ALFRED VILAKA Title Owner of Lot 312 of Parcel No. 098-012-286 hereby agree to let MORRIS KUMAKANA of Munda Western Province to purchase the land from me with the price of SBD $10,000.00 (Purchase Price).
Part payment of SBD $5,000.00 shall be paid by depositing to my Bank Account with NBSI No: 0107279702016 by today, 24/12/02 and Morris Kumakana to provide deposit slip of the payment and I shall provide receipt of payment to Morris Kumakana.
The last payment of SBD $5,000.00 shall be made at the time which both of us to sign RT Form 2 to transfer the grant of a Fixed Term Estate to Morris Kumakana.”

4. The Fixed Term Estate Register shows that parcel number 098-012-286 was not granted to the Defendant until 27 June 2003. The premium paid for the grant was $2,350.00. It is agreed between the parties that the deposit of $5000.00 was paid in accordance with the agreement. I heard evidence from both parties. Through his previous counsel the Defendant had claimed the purchase price was $30,000.00. He accepted however in the pleadings and in his evidence that it was only $10,000.00.
5. The Claimant deposed that the Defendant sought the balance of $5,000.00 in early 2002 even though the Defendant was not in a position to transfer the land to him. The Claimant described how he raised that sum and paid it into the Defendant’s bank account. He then provided the receipt from the bank to the Defendant. I accept his evidence about paying the balance. I do not accept the evidence of the Defendant that the balance was not paid. By the time title was transferred to the Defendant from the Commissioner of Lands the Defendant had the obligation of obtaining the consent of the Commissioner and transferring the title. He did neither.
6. Having made a significant profit by selling the land to the Claimant for $10,000.00 which was only going to cost him $2,350.00, the Defendant did not fulfil his side of the agreement.
7. The Claimant seeks an order for specific performance requiring the Defendant to transfer title to him. In the alternative he seeks in order empowering the Commissioner to transfer the title to the land, to the Claimant.
8. The Defendant has brought a counterclaim alleging the Claimant is in occupation of the land without the consent of the Defendant and thereby is trespassing on the land. He seeks an order that the Claimant surrenders possession of parcel number 098-012-286 within 30 days. He offers to compensate the Claimant in the sum of $450,000.00 for the development carried out on the property.
9. An issue has arisen because the property has been developed and is now much more valuable that it was in December 2002. When land is transferred it is liable for stamp duty. In 2014 the Defendant offered to transfer the land to the son of the Claimant but the stamp duty requested was based on the value of the land at that time. The Claimant has rejected this arrangement. If stamp duty is required for a transfer to the Claimant then the Claimant would only be liable for stamp duty for land valued at $10,000.00. Any stamp duty payable on a value higher than that amount should be paid by the Defendant as it is his failure that has caused the present situation.
10. There is no doubt that the Defendant agreed to transfer the property to the Claimant in 2002. The consideration to be paid was $10,000.00. The Claimant paid the Defendant that sum. The Defendant has failed to complete his side of the agreement. Section 9(2) of the Limitation Act provides:
    • “(2) No action shall be brought, nor any arbitration shall be commenced by any other person to recover any land after the expiration of twelve years from the date on which the cause of action accrued to him or, if it accrued to some person through whom he claims to that person:”

Section 9(2) has a proviso that is not relevant for the purpose of these proceedings.

11. The effect of section 9(2) is that the Claimant had 12 years from the date the Defendant ought to have transferred title, to commence these proceedings. Having paid the complete purchase price, to the Defendant, the Defendant ought to have kept his side of the agreement once he received title on 27 June 2003. The twelve year period must have commenced at least by that date. The Claimant’s plea for an order for specific performance is therefore statute barred.

The Counter-Claim

12. The Defendant (Counterclaimant) has submitted that he executed transfer documents in favour of the Claimant’s son but the Noro Lands Office refused to accept the transfer without valuation reports to determine the value for the purpose of stamp duty.
13. As a consequence as he is still the holder of the fixed term estate. He seeks an order that the Defendant surrender possession of the land to him.
14. As already determined the Claimant (Counter defendant) had completed his side of the agreement for the purchase of the land. The failure to secure the approval of the Commissioner and to file the transfer documents in 2003 has resulted in the present situation. In these circumstances to force the Claimant to surrender the land would be to perpetuate a fraud against the Claimant.

Discussion

15. The Claimant submitted that Defendant agreed to sell land that he did not own as it had not at that time been granted to the Defendant. The effect of this he submitted was that the agreement was either illegal or voidable. This assessment does not assist the Claimant as he seeks an order for specific performance. However relying on Ika v Szetu [2005] SBHC 2 the Claimant submits that a bona fide purchaser such as himself may still have the benefit of the agreement. The problem with this submission is that he remains caught by section 9(2) of the Limitation Act.
16. The Claimant then submitted that the Defendant’s title was able to be forfeited for breach of a condition of the grant to the Defendant. Counsel relied on section 136(1) (d) of the Land and Titles Act as amended in 2014. Section 136 gives the Land Board the right to forfeit the estate in particular circumstances. The right to forfeit is with the Land Board. There is nothing before me to show that the Land Board has chosen to follow this path. Section 136 does not confer on a purchaser the right to forfeit the estate. It seems that the Claimant is proposing that the Land Board forfeit the title and grant it to the Claimant. The Land Board is not a party to these proceedings. If the Land Board chose to forfeit the estate that is their choice as is the decision whether to grant title to another person. This argument does not assist me on the basis of the pleadings before me.
17. The Claimant then submitted that the Defendant’s application to remove the Claimant from the land was subject to section 9(2) of the Limitation Act because he could have brought the claim against the Claimant once the Claimant moved on to the land. If there is a cause of action such as trespass as the Defendant alleges, it is a continuing cause of action while the trespass continues. Such pleadings do not trigger section 9(2) of the Limitation Act. This issue does not need to be determined because the Court cannot be used to assist to perpetuate of a fraud. The Court would be in this position if it granted the counterclaim in the knowledge that the Claimant had paid the purchase price for the land but title remained in the name of the Defendant because of the failure of the Defendant.
18. The Claimant then submitted he was able to claim acquisition by prescription pursuant to section 224(1) of the Land and Titles Act. He submitted that as he has been in possession for more than 12 years he is entitled to have the land transferred to him on the basis of adverse possession.
19. The possession by the Claimant was not adverse possession because the agreement specifically permitted him to move on to the land. There may be an argument that in 2014 when the Defendant purported to set aside the agreement the possession became adverse. There has not a further 12 years of uninterrupted adverse possession following 2014. The claim for acquisition by prescription through adverse possession was not pleaded in the claim. It could therefore not be permitted even if there had been proof of uninterrupted adverse possession for the prescribed 12 years. The claim for acquisition by prescription cannot succeed.
20. The Claimant pointed out that it was the duty of the Defendant to obtain the consent of the Commissioner of Lands, but he had failed to obtain such consent. He referred to the obtaining of a valuation report by the Defendant and said that as the Defendant is his cousin brother the Claimant can seek an exemption from paying stamp duty as transactions between family members are exempt.
21. For the avoidance of doubt, the agreement to sell the land and the payment for such land was made in 2002 and 2003. If stamp duty were required it should be assessed at the time of the agreement and the purchase. The value of the land in 2002 or 2003 was at least $2,350.00 being the amount of the premium in June 2003. It was possibly as high as $10,000.00, being the amount agreed to be paid. The value could not be assessed at a greater value than $10,000.00 in 2002 or 2003.
22. The Defendant however sought to resolve the matter in 2014 and deposed that the Claimant was at fault for not paying the stamp duty.
23. The Defendant went on to say that the declaration evidencing the agreement is not admissible because it was not stamped. Because of the conclusions I have come to I do not need to deal with this submission. There is agreement between the parties that there was an agreement to sell the land. There is no dispute as to the terms of that agreement. They are set out in the agreed facts.
24. The Defendant holds title to the property parcel 098-012-286. He agreed to sell the property to the Claimant even before he acquired title. The Claimant paid the Defendant the purchase price. The Claimant is well out of time to bring the proceedings to require the transfer to him. However he has certainly acquired equitable title to the land.
25. That position then is protected by section 114(g) of the Land and Titles Act. As the owner of the fixed term estate the Defendant holds the title subject to the Claimant’s overriding interest affecting the Defendant’s interest even though it is not noted on the register. The Claimant has acquired the equitable ownership of the fixed term estate. He is in actual occupation or in receipt of the rents or profits. The Defendant effectively holds the title in trust for the Claimant. The Registrar of Titles may register that interest on the title in whatever manner he thinks fit.
26. The effect of this is that the Defendant may not deal with the property in any way that may impact the equitable interest of the Claimant in parcel number 098-012-286.

Orders

1. On the claim the Court refuses the first four orders sought as they are barred by section 9(2) of the Limitation Act.
2. On the Counterclaim judgment is in favour of the Counterclaim defendant, Morris Kumakana resulting in the following orders.
   • (a) I declare the value of PN 098-012-286 at the time of the agreement to transfer the property to Morris Kumakana and the time the purchase price was paid did not exceed $10,000.00.
   • (b) I declare that Morris Kumakana is the equitable owner of PN 098-012-286.
   • (c) I further declare that Alfred Vilaka as the registered owner of the fixed term estate PN 098-012-286 holds that interest subject to the overriding equitable interest of Morris Kumakana.
3. The Registrar is at liberty to make such notation on the register as he may determine to give effect to these orders.
4. The Defendant Alfred Vilaka is to pay the costs of the Claimant if not agreed to be taxed.

By the Court
Hon. Justice Howard Lawry
Puisne Judge