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High Court of Fiji |
IN THE HIGH COURT OF FIJI
(AT SUVA)
CIVIL ACTION NO. HBC 331 OF 2000S
Between:
OM CHAND
Plaintiff
(Caveator)
and
VISAMA RICE MILL LIMITED
First Defendant
(Caveatee)
and
REGISTRAR OF TITLES
Second Defendant
and
THE ATTORNEY-GENERAL
Third Defendant
S. Chandra for the Plaintiff
S. Parshotam for the First Defendant
J.J. Udit for the Second and Third Defendants
DECISION
This is an application by the First Defendant to set aside an order of this Court made ex parte on 25 August 2000. The subject matter of the order was a caveat No. 482950 lodged by the Plaintiff on 20 June 2000 against CT 29115 part of which, previously known as Lot 11, was part of a piece of land CT 12857 a portion of which was the subject of a deed of gift between the Plaintiff and his mother Dhupraji and his brother Manik Prasad dated 21 May 1973 under which the portion was to be conveyed to him.
Before turning to the facts it may be helpful briefly to refer to the procedures governing to this type of application.
The lodgment and removal of caveats over land is governed by Part XVII of the Land Transfer Act (Cap 31 – the Act). A person claiming an interest in land may lodge a caveat (Section 106) disclosing the nature of the claim and the manner in which it arose (Section 107) with the Registrar of Titles.
Sections 109 and 110 of the Act provide a means by which a caveat which has been accepted by the Registrar may be removed. Under Section 109 the Registrar gives notice to the registered proprietor of the land (the caveatee) that a caveat has been lodged. The caveatee may then issue a summons to the caveator to show cause why the caveat should not be removed. Alternatively, a caveatee coming to know of the caveat may (presumably before receiving a notice under Section 109) apply to the registrar to have the caveat removed. In this case the Registrar gives notice to the caveator to remove the caveat within 21 days. The caveatee may then apply to the Court for the caveat to be extended.
It is important to note that both sections only permit the Court to deal with the summons either of the caveatee or of the caveator:
“upon proof that the (other party) has been duly served (with the summons) and upon such evidence as the Court may require ...”
When such proof and evidence are placed before the Court it:
“may make such order in the premises either ex parte or otherwise as the Court thinks fit”.
Where the Court orders the caveat to be extended there is no specific provision in the Act for a subsequent application by the caveatee for its removal. There is however a general power in the High Court to set aside orders made ex parte (RHC Order 32 r 6) and it is clear to me that when such an application is made the procedural provisions of Section 109 (2) apply. This is consistent with the remarks of Fatiaki J who in Narain v. Malley (1988) 34 FLR 121 said:
“I am mindful that it is inappropriate for the Court at this stage to determine the rights of the parties to the action in a summary manner particularly where there are conflicting affidavits and where the question of a caveatable interest is a distinctly arguable one.”
Our own Act is similar to the provisions of the New Zealand Land Transfer Act 1952. In Catchpole v. Burke [1974] 1 NZLR 266 McCarthy P explained that:
“when it is plain to the Court that the caveator cannot possibly succeed in establishing his claim against the registered proprietor it is proper to refuse to extend the caveat (Re Jones [1908] NZGazLawRp 114; (1908) 11 GLR 30). But where there are doubts surrounding the rights of the caveator ..... the proper course is to extend the caveat until the conflicting claims of the different parties are determined in actions brought for that purpose”.
In Stewart v. District Land Registrar [1980] 2 NZLR 706 Barker J explained that:
“A caveator is given under Section 145 14 days within which ... to apply to the Court for an order to keep the caveat alive ... Normally an order from this Court is granted keeping the caveat alive on fairly stringent terms as to litigating the caveator’s claim providing the caveator can show a prima facie case for his caveat.”
In the present case it is accepted by Mr. Chandra that although a writ was filed on 31 August 2000 and was met with a notice of intention to defend no Statement of Claim has been filed as is required by RHC O 18 r 1.
Mr. Chandra also accepted that the order of the Court made on 25 August 2000 was made following the filing of an ex parte notice of motion, that the caveatee had not been served and that no copy of the caveat was produced to the court. It also appears likely that the caveat itself, a copy of which was not produced until exhibited to Arvin Chand’s affidavit filed on 17 October 2000 (Exhibit B) had in fact been cancelled by the Registrar of Titles or should at the very least have been cancelled by the Registrar by reason of effluxion of the 21 day period prior to the hearing of the application for its extension following application No. 483728 for its removal lodged by the caveatee. It is therefore not at all clear that the order of 25 August 2000 was obtained regularly. A party against whom an order is obtained irregularly is entitled to have that order set aside ex debito justistiae (Anlaby v. Praetorius [1888] UKLawRpKQB 55; (1888) 20 QBD 764).
The following affidavits were filed:
Both Mr. Chandra and Mr. Parshotam also filed helpful written submissions on the day of the hearing (19 August 2002).
The facts are rather involved but for the purposes of this application may be quite briefly summarised.
As already seen, the subject matter of the dispute is part of a portion of CT 12587 (Exhibit D to the first affidavit). By virtue of the deed of gift (Exhibit A to the first affidavit) the Plaintiff’s mother and brother agreed to convey very roughly half of the land comprised in CT 12587 to the Plaintiff who agreed to subdivide it.
On 2 August 1973, a few months after the deed, the Plaintiff lodged a caveat No. 129530 (Exhibit E to the first affidavit) against CT 12857 to secure his interest obtained under the deed.
By 1978 a plan for the subdivision of the land had been drawn up (Exhibit B to the 8th affidavit) but apparently some problems were encountered connected at least in part with an encroachment into Lot 11 (which was part of the portion of CT 12587 to be conveyed to the Plaintiff by the deed of gift) by a building erected on CT 12855 which was a piece of land adjacent to CT 12587 and which was also owned by a company, Suva Aereated Water and Confectionery Co. Ltd controlled by the Plaintiff’s stepfather, mother and brother and which had a factory on the site.
In 1979 the Plaintiff commenced legal proceedings against his mother and brother in the then Supreme Court. On 11 June 1982 the proceedings were settled (Exhibit B to the first affidavit). Paragraphs 5 and 6 of the terms of settlement provided that the Plaintiff would partially withdraw caveat No. 129530 in respect of Lot 11 of CT 12857 while Lots 5 and 7 were to be transferred to the Plaintiff by the First Defendant herein which was described as “the successors in title to the Suva Aereated Water and Confectionery Co. Ltd”.
According to the second affidavit the First Defendant acquired CT 12855 and three other pieces of land from the liquidator or Aereated Water on 3 April 1981 (Exhibits B and D5). The transfer of the four properties to the first Defendant was registered on 15 May 1981 (Exhibits D1, D2, D3 and D4).
How the 1982 settlement to which the First Defendant herein was not a party could include a transfer of land which was no longer owned by the parties to the agreement is not clear. Neither it is clear how on 3 April 1981 the Plaintiff’s mother and brother could agree to transfer Lot 11 to the First Defendant herein when it was still subject to caveat 129530 (see Exhibit F to the second affidavit).
According to paragraph 11 of the 8th affidavit the Plaintiff, in pursuance of paragraph 5 of the agreement caused to be prepared and then signed a draft partial withdrawal of his caveat over Lot 11. A copy of this document dated 11 June 1982 is Exhibit H to that affidavit while a withdrawal in proper form is Exhibit I dated 1 July 1982. Both documents were prepared by Chauhan & Co., the solicitors for the Plaintiff who filed the terms of settlement, also dated 11 June 1982.
What happened next is not clear but I was told from the Bar that the settlement broke down. The next significant event which is recorded is that on 8 December 1994, that is over 12 years after the draft partial withdrawal was prepared, a copy of it was lodged with the Registrar of Titles by solicitors acting for the First Defendant (see first affidavit, Exhibit E page 2; first affidavit Exhibit D second page 6th memorial; second affidavit paragraph 11 and 7th affidavit paragraph 3.6). According to paragraph 11 of the second affidavit the Plaintiff’s mother and brother delivered the partial withdrawal to the First Defendant’s solicitors. Following the delivery the 1981 transfer of Lot 11 was also lodged (see Exhibit F to the second affidavit) and the Plaintiff’s mother and brother were paid their $10,000. It is the lodgment of the partial withdrawal of which the Plaintiff complains.
As has been seen the caveat with which this application is concerned is first, caveat 482950 and only in the alternative caveat No. 129530 (see the ex parte notice of motion dated 15 August 2000). According to the first affidavit when the Plaintiff discovered that caveat 129530 had been partially withdrawn he lodged the second caveat 482950 over CT 29115. This was a new title issued to the First Defendant, also on 8 December 1984, when the four neighbouring titles 12853, 12854, 12855 and 12856 plus the transferred Lot 11 from CT 12857 were amalgamated (see Exhibits J1 and J2 to the second affidavit). Upon request being issued by the Registrar of Titles pursuant to Section 110 (1) of the Act the Plaintiff applied to the Court for its extension. The basis upon which the Plaintiff sought extension was the alleged fraudulent use by the First Defendant in 1994 of the 1982 partial withdrawal which as has been seen was prepared in anticipation of the implementation of the failed settlement. The Plaintiff asked the Court either to extend the replacement caveat 482950 or to declare that the earlier caveat 129530 was still extant.
In his written submissions Mr. Chandra repeated the Plaintiff’s assertion that he had been fraudulently deprived of the protection of caveat 129530 and that therefore he was entitled to the protection of the Court. He also suggested that the effect of the subdivision had been to landlock that portion of CT 12587 (including Lot 11) to which he was entitled under the 1973 deed of gift. This was a further reason for extending the caveat.
In answer to these submissions Mr. Parshotam pointed out that the value of Lot 11 (said to be somewhere between $15,000 and $38,000 was far exceeded by the value of the transaction, namely the sale of CT 29115, which was being prevented by the continued extension of the caveat. He also stressed that the Plaintiff had taken no further steps to prosecute his claim since filing the writ in August 2000. He suggested that the fraud, if any, was perpetrated not by the First Defendant but by the Plaintiff’s mother and brother and that therefore it was quite wrong to continue penalising the First Defendant.
In my view the landlock issue can be shortly disposed of. It was not raised in the first affidavit and was not therefore a factor in the granting of the first extension. According to the 10th affidavit, taking into account the contents of the 9th affidavit the landlocking is essentially technical and arises from a now defunct access denial strip which the Director of Town and Country Planning has agreed to remove.
The second issue, namely the first Plaintiff’s alleged fraudulent conduct however raises more troublesome questions. From the papers before me there can be little doubt that the manner in which the 1982 partial withdrawal was used to obtain title to Lot 11 gives rise to disquiet. The more than 12 years gap between the preparation of the partial withdrawal and its lodgment has already been noted. In view of the fact that the 1982 partial withdrawal was in respect of CT 12857 of which the plaintiff’s mother and brother were specified to be the owners it is hard to see how this withdrawal could properly have been lodged on behalf of a subsequent owner of the land, the First Defendant. The Second Defendant has not produced the 1982 partial withdrawal lodged in 1994. The Plaintiff says that he retains the original. What then was lodged?
It was conceded by Mr. Parshotam that the 1973 deed of gift properly gave rise to a caveatable interest. The question therefore now is whether a further extension of the caveat can be justified. In my view it cannot.
Complicated issues of fact, particularly claims of fraud cannot be litigated by way of affidavit. That is why a person establishing prima facie that he has a caveatable interest must litigate that interest (see Stewart – supra). The Plaintiff has not done so beyond issuing a writ. I accept that the value of Lot 11 is far exceeded by the detriment to the First Defendant caused by the continued existence of the caveat. An undertaking as to damages was filed by the First Plaintiff on 17 October 2000. As earlier noted is seems clear that the original extension was obtained irregularly and quite possibly after caveat 482950 had been cancelled.
As to the alternative order sought it cannot be doubted that as a matter of fact caveat 129530 was partially withdrawn in 1994 and in my opinion that withdrawal cannot now be reversed.
I order that caveat 482950 be removed forthwith. This order, of course, has no direct effect on civil action HBC 331/2000 which may now resume its normal course.
M.D. Scott
Judge
22 August 2002
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