Sukhdeo v Narayan [2005] FJHC 139; HBC0406d.2004s (16 June 2005)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. 406 OF 2004

Between:

BRENNAN SUKHDEO
f/n James Sukhdeo
and LUSIANA BOLALAILAI
Plaintiffs

and

AVENDRA NARAYAN
f/n Shiu Ram
Defendant

Mr. A. Tikaram for the Plaintiff
Ms. M. Chan for the Defendant

DECISION

There are two summonses before me, one from the plaintiffs and the other from the defendant.

The Plaintiffs by their summons dated 5 November 2004 seek an order ‘extending caveat No. 542079 until the hearing and disposal of the plaintiffs’ application by way of writ for Specific Performance or further order of this Court.’

The application is supported by an affidavit sworn by the first plaintiff on his and on behalf of his co-plaintiff.

By his summons dated 13 October 2004 the defendant seeks orders as follows:

1. To set aside the Writ of Summons served on the Defendant, being null and void for lack of consent by the Director of Lands under State Lands Act section 13(1) (Cap 132);
   
2. Alternatively, an order striking out these proceedings as frivolous and vexatious and an abuse of the Court process;
   
3. An order to set aside an order of 15 September, 2004 of this Honourable Court, granting the Plaintiff’s leave to extend date of caveat and giving leave to serve the Writ of Summons on the Defendants Solicitor;
   
4. A declaration that the Plaintiffs have defaulted on the Sale and Purchase Agreement between the parties dated 7 April, 2004, and have forfeited their deposit under clause 8.1(a) of the Agreement;
   
5. A declaration that the Plaintiffs failed to obtain consent of the Director of Lands within the 3 months allowed for settlement under the Sale and Purchase Agreement;
   
6. The Plaintiffs immediately remove Caveat No. 542079 over State Lease No. 2057.
   

The defendant filed an affidavit in reply to the plaintiffs’ affidavit followed by a reply thereto by the plaintiff.

As ordered, both counsel filed written submissions which I have considered.

Background facts

The parties entered into a sale and purchase agreement dated 7 April 2004 for the purchase of the defendant’s Crown Lease property being Crown Lease No. 2057 (the ‘property’) for the consideration of $85,000.00.

A deposit of $8500.00 was paid to the defendant and after obtaining the consent of the Director of Lands Caveat was registered No. 542079 against the Lease.

The purchase was to be settled within 3 months subject to the consent of the Director of Lands. The three months lapsed but the consent was not given. Whereupon without any default notice having been served on the plaintiffs the defendant through his solicitor on 21 July 2004 cancelled the Agreement and forfeited the entire deposit of $8500.00.

The defendant through the Registrar of Titles required the removal of the said Caveat when plaintiff issued the Writ of Summons herein.

On 15 September 2004 the Court made an order ex parte extending the said Caveat until further Order of this Court.

Plaintiffs’ contention

It is the plaintiffs’ counsel’s submission that the defendant knows that the plaintiffs were trying to get consent but when the said three months expired without giving default notice, as required under clause 8.1 of the Agreement, the defendant through his Solicitors by letter of 20 July 2004 cancelled the Sale and Purchase Agreement and forfeited the entire deposit of $8,500.00.

The plaintiffs say that they have a caveatable interest and they are entitled to lodge a caveat under s106 of the Land Transfer Act Cap. 131. To lodge this caveat the plaintiffs obtained prior consent of the Director of Lands.

As far as the consent of the Director of Lands under s13(1) of the State Lands Act is concerned to commence this action, the plaintiffs say that they can obtain this even before the hearing of this action. However, according to annexure ‘j’ to affidavit of Brennan Sukhdeo (for plaintiffs) the Director of Lands consent dated 20 July 2004 is endorsed on the ‘Transfer of Leasehold Land’ document. They argue that ‘prior consent’ is not mandatory in respect of commencing a Court proceeding.

Defendant’s submission

Briefly, it is the defendant’s counsel’s submission, as a preliminary objection to these proceedings, that s13(1) of the State Lands Act has not been complied with in that the plaintiff’s did not obtain the ‘prior consent’ of the Director of Lands prior to instituting these proceedings.

But the defendant does admit that consent was obtained on 20 July 2004 albeit belatedly. The defendant wants an explanation why ‘they did not obtain prior consent.’

Counsel submits to this Court that the orders granted on ex-parte basis were wrong in law and the plaintiffs’ summons for extension of time to withdraw caveat should be dismissed.

On the aspect of the consent of the Director of Lands, the defendant says that the plaintiffs were not able to obtain the consent of the Director after three attempts.

Counsel submits that the defendant twice offered refund of deposit minus the defendant’s solicitor’s legal fees which the 1st plaintiff offered to pay.

Counsel further submitted that the plaintiffs have no caveatable interest in the property after default and forfeiture of deposit.

The defendant further says that these proceedings are vexatious and frivolous and should be struck out as an abuse of the process of Court.

Consideration of the issues

I have given serious consideration to the very useful submissions from both counsel.

In deference to the very lengthy and comprehensive submission of Ms. Chan, I must say that this matter raises a number of triable issues arising out of the Sale and Purchase agreement entered into between the parties.

Because the consent of the Director of Lands could not be obtained to initiate these proceedings in time and before the alleged default in completing the sale, the defendant says in his preliminary objection that this action be struck out.

On the evidence before me I hold that the plaintiffs were entitled to lodge the said caveat pursuant to the agreement to protect their interest after obtaining the necessary consent of the Director of Lands. They had and still have a caveatable interest at the time of commencing this action by writ of summons.

The Director of Lands cannot prevent the action proceeding and the Court was justified in extending the caveat on an ex parte application and therefore the defendant’s present application to remove the caveat is refused.

As far as the issuing of proceedings is concerned I agree with Mr. Tikaram for plaintiffs, that the practice is that consent is often obtained at the time of hearing and which is often granted.

There are disputed facts in this case such as whether the contract still existed between the parties despite the fact the three months for the completion of the sale had expired and also interpretation of clause 8.1 of the agreement and whether ‘prior consent’ of the Director of Lands in ‘mandatory’ prior to issuing proceedings.

For the determination of these and other disputes between the parties they can only be decided in open Court and not through affidavit evidence.

The point of law raised by the defendant should I consider be decided in open Court in the light of evidence that may be adduced. I would rather, that I decide on ‘consent’ then and not throw the case out on a preliminary objection as it is not possible to do so in law and in the interests of justice.

For these reasons the defendant’s summons is dismissed with costs in the sum of $300.00 to be paid within 21 days.

The plaintiffs’ summons for extension of caveat as already granted is to continue until further order of this Court.

The action is to take its normal course.

D. Pathik
Judge

At Suva
16 June 2005