Singh v Jas [1992] FJHC 44; Hbc0298d.92s (29 September 1992)

IN THE HIGH COURT OF FIJI
At Suva
Civil Jurisdiction

CIVIL ACTION NO. 298 OF 1992

Between:

RAM JIT SINGH
s/o Ram JasPlaintiff

- and -

RAM JAS
s/o Ram Kala
Defendant

Mr. T. Fa for the Plaintiff
Mr. R. Patel for the Defendant

RULING

On the 6th of July 1992 this Court granted on the ex parte application of the plaintiff an interim injunction restraining the defendant from dealing with the proceeds of a mortgagee sale of a native leasehold. On the 10th of July the injunction was extended until further order and on the 22nd of July the defendant sought inter partes the dissolution of the injunction.

In order to better understand the competing claims of the parties it is necessary to deal briefly with the facts of the case as far as can be ascertained from the affidavits and annexures filed by the plaintiff and the defendant who are a son and father respectively.

In January 1981 the defendant who is described as a sawmiller acquired an industrial lease over a native leasehold situated at Togalevu, Veisari. At the time and since November 1967 the defendant and his 3 sons were conducting a sawmilling business under the firm name of Waitamata Sawmill. At some undisclosed date however the firm was 'converted' into a limited liability company Waitamata Sawmill Limited. The defendant's leasehold was then transferred to the company under a 'mortgage- back' arrangement that occurred on the 12th of July 1991.

On the face of the title document it is clear that the plaintiff has no 'interest' in the land in question. His claim however is based upon 2 written agreements dated the 11th of April 1990 (annexures 'B' and 'C' to the plaintiff's affidavit of 3rd July 1992) which purports to evidence an agreement by the defendant to sell his 'share-holding' to 2 of his sons namely, the plaintiff and Ram Dhir Singh for a fixed sum of $9,000 (annexure 'C').

In similar vein and for the same amount a third son Ranjeet Singh also agreed to sell his 'shareholdings' to his 2 brothers namely, the plaintiff and Ram Dhir Singh (annexure 'B').

Given the existence of the agreements I felt able to grant the interim injunction at the outset.

The defendant however in seeking the dissolution of the injunction has put forward 4 grounds which he claims renders the agreements (i.e. annexures 'B' and 'C') "... invalid, null and void and unenforceable." These are:

"3 (a) that the (agreement) was never consummated;

(b) that no payment was ever made by the plaintiff to the defendant or Ranjit Singh;

(c) that no consent was obtained from N.L.T.B. for the sale of the property; and

(d) that the agreements were procured by fraud in that the plaintiff was an undischarged bankrupt at the time of their execution."

The plaintiff in reply to the above grounds deposed inter alia:

"(a) that the agreement was consummated;

(b) that payment was made to the defendant through the office of Messrs. Lateef & Lateef;

(c) that the consent of the N.L.T.B. was obtained for the transfer to Ram Dhir Singh ...;

(d) that I deny the contents of paragraph 3(d)."

From the foregoing it is clear that the enforceability and legal status (if any) of the 2 agreements in question raises serious questions which are incapable of being resolved solely on the basis of affidavit evidence.

Ground 3(c) however seeks to invoke the provisions of Section 12 of the Native Lands Trust Act (Cap.134) which renders null and void any 'alienation' or 'dealing' with the land comprised in a lease of native land by a 'lessee' without the prior consent of the N.L.T.B.

In this regard it will be noted that both agreements specifically refers to a sale of the vendor's:

"Shareholdings in the property of Waitamata Sawmill situated on a five (5) acre land with a substantial dwelling thereon ..."; and later

"The said property is on NATIVE LEASE NO.15899."

Learned counsel for the defendant submits that the agreements necessarily give rise to a "dealing" with the land in question and therefore are null and void in the absence of N.L.T.B. consent. With respect I cannot agree.

In the first place neither the defendant or Ranjit Singh are the "lessee" of the land in question and secondly, the agreements refer to "shareholdings" and to property "on" the native lease and in my view may be specifically performed by the registration of share transfers without in any way affecting the subject matter of the lease. There is no merit in this ground.

There is no dispute as to the legality of the mortgagee sale which was effected by the defendant's solicitors on his behalf and although there are no details as to the outstanding amount (if any) owed to the defendant under the mortgage or of the amount realised from the sale, there can be no doubting that the plaintiff only claims a "50% share" in the proceeds of sale.

Then learned counsel for the defendant submits that the plaintiff has failed to disclose the fact that he is an "undischarged bankrupt". This is said to be "material" not only to his ability to bring these present proceedings or give an undertaking in damages but also to his entering into the agreements in question.

I confess that having considered learned counsel's submissions on this aspect I am not at all convinced that the plaintiff's "non-disclosure" is of such a nature and gravity as to materially affect this Court's exercise of its discretion to grant the injunction in the first instance.

In so saying I am of course mindful of the close personal relationship that exists between the parties, the 20 years that has expired since the adjudication order was made and more particularly, of the Official Receiver's written consent to the taking of these present proceedings in the name of the plaintiff.

In all the circumstances subject to the defendant paying into Court one half of the proceeds of the mortgagee sale, the injunction is hereby dissolved.

For the sake of completeness I also order the defendant or his authorised agent to prepare and file an affidavit accounting for and accompanying the payment of the aforesaid proceeds into Court.

(D.V. Fatiaki)
JUDGE

At Suva,
29th September, 1992.

Hbc0298d.92s