JUDGMENT
This is an application to strike out the defendant's Statement of Defence on the ground that 'it discloses no reasonable defence'.
It appears from the papers that the plaintiff successfully tendered for and purchased a motor vehicle sometime in September 1996 from the Asset Management Bank in the exercise of its powers under a Bill of Sale viz. Book 93 Folio 3663 dated 31st August 1993 (the '1993 Bill of Sale'). This Bill of Sale was purportedly granted to the National Bank of Fiji (NBF) (the predecessor to Asset Management) by Abdul Rahim and Suman Lata Ali who in the preamble to the Bill of Sale are described as 'the owner of the asset'.
At the time of purchase however, and unbeknown to the plaintiff, the defendant Finance Company also had a Bill of Sale registered over the vehicle viz. Book 95 Folio 1775 dated the 8th of June 1995 (the '1995 Bill of Sale') which purports to have been granted by one Akbar Ali.
The plaintiff after purchasing the vehicle used it for approximately a year before it was seized by a bailiff acting on behalf of
the defendant company pursuant to its powers under the '1995 Bill of Sale'. Communications were entered into between the parties and by letter dated November 11, 1997 the defendant company under the hand of its Legal Executive wrote to the plaintiff as follows:
"... our solicitors Messrs. Fa & Co. have confirmed that NBF Asset Management Bank seized the abovementioned vehicle under
Bill of Sale No. 3663 dated 3rd September, 1993.
In the circumstances we confirm that we no longer hold any claim against the said vehicle despite our Bill of Sale No. 1775 dated
09th June 1995.
Please find time to take delivery of the said vehicle.
We take this opportunity to apologise for our action and thank you for bearing with us.
Any inconvenience caused is sincerely regretted."
The plaintiff however, refused to take delivery of the vehicle claiming that since its seizure and whilst in the custody of the defendant
bank, the vehicle had been damaged.
With that background in mind I turn to consider the defendant's defence to the plaintiff's claim for damages for the unlawful and
wrongful seizure of the motor vehicle. In particular, para. 2 of the Statement of Defence pleads:
"The Defendant admits para.4 (i.e. the seizure of the vehicle) and it further says that it exercised its powers under the Bill of Sale Book 95 Folio 1775 given by Akbar Ali to the defendant company
on or about the 8th of June 1995. Further the defendant says that the plaintiff has not acquired good title to the vehicle because
at the time the National Bank of Fiji registered its Bill of Sale (Book 93 Folio 3663) to secure the indebtedness of Suman Lata Ali and Abdul Rahim the vehicle was registered in the name of Mr. Akbar Ali."
In further elaboration of this latter ground the Legal Executive of the defendant company deposes in his affidavit in opposition:
"... that on the 23rd of October, 1996 the said vehicle was transferred from Akbar Ali to Suman Lata and then subsequently to
the National Bank of Fiji and eventually to Nemani Buliruarua (the plaintiff)."
and in support thereof there is annexed a standard form letter from the Road Transport Department to the defendant company's solicitors dated 24.10.97 outlining the history of registered ownership of the vehicle. On the reverse side of the letter is the following significant entry:
"PAST OWNER PERIOD: AUGUST-SEPT 1993 & MAY-JUNE 1995
AKBAR ALI f/n Muni Prasad
11 Fulaga Street
Samabula
SUVA
DATE OF OWNERSHIP: 14.05.90"
Unfortunately and perhaps understandably, there were no affidavits tendered by either party from Abdul Rahim, Suman Lata Ali or Akbar Ali.
Counsel for the plaintiff in moving the application writes in his written submission:
"The Defendants explanation and its whole Defence rests on one issue only, namely, that the First Bill of Sale was invalid.
The only ground advanced for this invalidity is that the grantors of the First Bill of Sale, namely Abdul Rahim and Suman Lala Ali
were not the owners at the time.
The only evidence produced for this assertion is a letter dated 24 October 1997 from the Department of Road Transport which simply
states the dates current and last two owners of the vehicle were registered with the Department."
Counsel further writes inter alia:
"The Bills of Sale Act is a statutory registration system of chattel mortgages. If the provisions of the Bills of Sale Act are complied with and a Bill of Sale duly registered, that Bill of Sale takes priority over any subsequent Bill of Sale (S.12) ...
The Traffic Act has however a quite different purpose. As the long title puts it, the Act contains the 'law relating to Traffic and
the control of transport'. As part of the control of traffic the Act requires all vehicles using roads to be duly licensed. To facilitate
this control the Act requires (S.15) that when first licensed a vehicle must also be registered in the name of the applicant for
that licence. To drive an unregistered (and for that matter unlicensed) vehicle on a road is an offence. There is no compulsion to register under the Traffic Act unless one requires the vehicle to be driven
on the road. The Traffic Act registration of ownership is simply part of the control of traffic purpose of the Act. It is not per
se a title registration system bestowing priority on registration etc.
It is for example quite common for farm vehicles not needed on any road not to be registered but this in no way affects the owners
'title' to the said vehicle.
The Defendants whole case then hinges around a false assumption that registration under the Traffic Act bestows title."
Ms. Lutu for the defendant company accepts that the defence is based upon the invalidity of the '1993 Bill of Sale' insofar as the grantors of the Bill of Sale were not the registered owners of the vehicle at the time, and counsel says, the principle 'nemo dat quod habit' applies so as to render the plaintiff's title void.
She further submits that the defence raises the distinct possibility of a 'fraud' having being perpetrated on NBF in the grant of the '1993 Bill of Sale' which, if proved, would render the Bill of Sale and the subsequent transfer of the vehicle to the plaintiff void and in-effectual for all intents and purposes.
In reply, Mr. P. Howard for the plaintiff forcefully submits that the plaintiff his client, is a 'bona fide purchaser for value without notice' of any 'fraud' and therefore obtained good title despite any 'fraud' that may or may not have occurred in the creation of the '1993 Bill of Sale'.
Counsel further submits that the plaintiff had no reason to doubt the validity of the '1993 Bill of Sale' or NBF's power to transfer the vehicle to him, nor, did he have any duty to investigate the same. Such investigations, in any event, would have merely revealed the existence of a later
'1995 Bill of Sale' registered over the vehicle.
Having carefully considered the opposing submissions and the affidavit evidence in this case and mindful that this "drastic remedy of striking out a pleading, or part of a pleading, cannot be resorted to unless it is quite clear that the pleading
objected to discloses no arguable case. Indeed ... the rule is applicable only in plain and obvious cases" [per Willmer L.J. in Waters v. Sunday Pictorial Newspapers Ltd. (1961) 1 W.L.R. 965 at p.970], I am firmly of the opinion that the defendant company's Statement of Defence raises no arguable case against the plaintiff's claim in so far as the defence as pleaded relies on a fundamental misconception as
to the legal effect of registration of ownership of a vehicle under the relevant provisions of the Traffic Act (Cap. 176).
I am fortified in my view by the obiter dictum of the Fiji Court of Appeal in Sada Nand v. Ram Indra Civil Appeal No. 35 of 1991 (unreported) where the Court observed at p.8 of its judgment:
"Finally, we might say a word whether registration of a vehicle under the provisions of the Traffic Act establishes (i) ownership;
(ii) is necessary to establish ownership; (iii) is conclusive evidence of ownership; (iv) is merely evidence of ownership. Whilst
it is unnecessary for the purposes of this appeal, we nevertheless point out that (iv) above is clearly the situation."
Then after setting out the provisions of Section 19(1)(a) and (1)(b) of the Traffic Act the Court of Appeal said, in clear support of plaintiff counsel's submission (op.cit), at p.9:
"It quite clearly assumes or requires ownership before doing whatever has to be done in relation to registration. In particular
it appears to require registration of goods being a motor vehicle if it is to be used on a road."
The application is granted. The Statement of Defence is accordingly struck out and judgment is hereby entered in favour of the plaintiff's claim for damages to be assessed.
D.V. Fatiaki
JUDGE
At Suva,
3rd July, 1998.
Hbc0489j.97s
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