Devi v Singh [2005] FJHC 368; HBC0223.1994 (29 September 2005)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

ACTION NO. HBC0223 OF 1994

BETWEEN:

SUMINTRA DEVI
PLAINTIFF

AND:

BAL RAM SINGH and
DHARAMPAL SINGH
DEFENDANTS

Mr H A Shah for the Plaintiff
Mr Boseiwaqa & Ms Muir for the Defendant

Date of Hearing: 25 August 2005
Date of Judgment: 29 September 2005

INTERIM JUDGMENT OF FINNIGAN J

In this Action a beneficiary of an estate sues the Administrator and Trustee, seeking an order that the estate be distributed amongst the testator’s named beneficiaries. One of the Defendants Dharampal Singh has died in the meantime and could not be called to account.

The action was commenced in August 1994. By August 1996 the proceedings were ready for hearing. It is a matter of great regret that this action has lying about in the Registry since that time waiting for a hearing. Hearing the evidence took just over 2 hours. It was abundantly plain to me when the Defendant concluded his evidence that he had no defence to the Plaintiff’s claim and so the delay is doubly significant. The Plaintiff has been deprived of her remedy for 9 years and her children have grown through important years of their lives without the benefits of their father’s estate. By the same token the Defendant must now find a significantly greater sum in order to meet her just claims.

The estate in question is that of Ram Shankar Singh. In his Will he left his entire estate absolutely to 7 beneficiaries being his wife and his 6 sons. He died on 14 April 1968. His estate for present purposes was a sugar cane contract No. 2395 Baravu Sector which was based on a farm of about 40 acres. Each of the sons was allocated a 5 acre portion of the farm. One of the sons was Narendra Singh. He was the Plaintiff’s husband. He and the Plaintiff with their 4 children lived on his 5 acre portion in a wooden house of 2 bedrooms and one separate bedroom with each own electricity and water, separately metered. I accept the Plaintiff’s evidence about that. They had 4 children.

Narendra Singh died on 16 December 1990. At that time the children were aged 18, 16, 12 and 3 years. He had been in fulltime employment and with the help of his eldest son had been cultivating his 5 acre lot. He had been receiving his portion of the nett income from the sugar cane production on that lot. It is not disputed that the house belonged to him.

Letters of Administration in Narendra’s estate were granted to the Plaintiff on 1 April 1992. It is not disputed that the house belonged to her after her husband died. From the time of his death however she ceased to receive the share of income from the farm that Ram Shankar’s trustees had been paying to her husband. Deprived of her late husband’s income since 1990, she remained on the land in the house with the children until 1994 and asked the trustee of Ram Shankar Singh’s estate to continue the payments that were due to her late husband. No payments were made. She left the land and the house in that year and commenced this proceedings.

On 16 May 1992 the Defendant took over as a trustee of his father’s estate. One brother retired and the Defendant with a third brother were appointed. If his evidence is to be believed the Defendant simply left everything to the third brother Dharampal Singh. Dharampal distributed the payments and got signatures in a book. When Dharampal died the Defendant got his own book and presumably took signatures from people to whom he distributed the estate’s income. He had brought some papers with him to Court but had no papers relating to the accounts of the estate. He apparently had with him nothing which Dharampal had kept while he was a trustee. He claimed that Narendra’s 5 acres had lain uncultivated from the time the Plaintiff left which he said was in 1993. He had heard the evidence of an officer of the Fiji Sugar Corporation about production from the farm between the years 1990 – 2005. He must have known his claim was patently untrue. He did not impress as a witness telling the truth neither did he impress as a trustee. He showed no sympathy with the needs of his dead brother’s wife and children or with their claims upon the estate. He, and presumably Dharampal, and presumably the previous trustee (Sundar Singh) simply continued to harvest cane from Narendra’s 5 acres allocation after he died and simply made no payments for that share to his estate. In my view it was a breach of their duties both to their father and to his descendants. Their duty to the estate beneficiaries is a fiduciary duty. The Courts have enforced this duty strictly for a very long time, since at least Keech –v- Sandford (1726) Sel Cas King 61.

An officer of the Fiji Sugar Corporation gave detailed evidence and produced documents in support for the tonnage gross income and nett income from Ram Shankar Singh’s farm in each year from 1996 to 2004 inclusive. I accept his evidence that the area under cultivation was 24.5 acres. I accept that any reduction in the area cultivated should have been notified and there was no notification. I accept the figures he produced as establishing production from the same acreage during each of those years. I accept his evidence that the nett income from the farm during those years could be reasonably accurately calculated by assuming an average production of 70 tonnes per annum production from the land in question and an average nett return of $50 per tonne, yielding an annual nett income of $3,500.00. This method of calculation and its result were unchallenged.

Counsel for the Plaintiff asked me to assume a multiplier of 15 for the unpaid years between Narendra’s death and the date of trial which yields a total of $52,500.00. This also was unchallenged.

The Defendant while giving his evidence failed or refused to answer simple but vital questions. Instead he tended towards longer answers and took shelter behind what his brother might have done, which he did not know. Initially he said he did not know the number of the estate Bank account then when pressed he recited it from memory. Pressed for details of the account he said that it was presently more than $2,000.00 in credit but beyond that could give no details of money received or of monies paid out. He was quite unable to give any account at all of the trustee’s dealings with the estate other than to say money had been received, money had been paid out and signatures obtained and the NLTB rent had been paid. He said that till now everything had run smoothly, there had been no disputes and so it had not been necessary to keep records. The Affidavit of Service shows that he was served with these proceedings on 16 August 1994 which was 2 years after he became a trustee.

I accept the evidence of both the Plaintiff and the Defendant that Narendra’s house is built on Narendra’s share of the land.

The Defendant said that all the brothers cultivated their own shares. This included Narendra who had a job off the farm at Lautoka Timber & Building Supplies. He said all the brothers had equal shares and they distributed the rent equally. This included Narendra’s estate as the rent had to be paid and it was paid for everyone. He said they had done this since the time that they purchased the land and he said there is only one estate. I take him to mean that the brothers had their 5 acre allocations during their father’s lifetime. His answers about rent payment indicate that there was no change in rental payments after Narendra died. The fact is that after that time Narendra’s estate ceased to receive the income that had been paid to Narendra.

The Defendant told the Court the Plaintiff has always being free to pay the rent to the NLTB and to take the house away. To me this shows an abdication of his responsibilities and it conflict with the pleading in his statement of defence that she must first obtained the consent of the other beneficiaries.

Decision

Ram Shankar Singh made his Will on 12 October 1956, nearly 12 years before he died.

From the evidence of both Plaintiff and Defendant I find the Plaintiff’s case clearly made out. She seeks an order that the Defendant now distribute the estate of Ram Shankar Singh among the beneficiaries named in his Will. That order can be made.

Included in the order must be provision for the income that has been due to Narendra’s estate since his death in 1990. I accept and hold that this amount is $52, 500.00. Counsel sought a specific order that all income from the sugar cane contract No 2395 Vavaru Sector be henceforth paid to the Plaintiff’s solicitors’ trust account until that sum had been paid, this order to be alternative to a primary order directing payment in a lump sum. The problem with the lump sum order is that for some years (5 or more according to the figures supplied by the FSC witness) the other beneficiaries in the estate will be deprived of their regular income. It is not they who have been at fault. The judgment must be a judgment against the trustee and he must bear the brunt of it. He has to wind up the estate which includes providing for Narendra’s estate the value of his inheritance. He must then find the income that has not been paid to Narendra’s estate since 1990.

It will be for the Defendant to decide how he meets this judgment. I take account of the submissions of Counsel for the Defendant that the Court must allow for the equitable interests of the other beneficiaries. He reminded me also that this is Native Land and that if the order of distribution results in dealings with the land then the Defendant will need time to comply with formalities such as statutory consents.

I will therefore give the Defendant a little room to take advice and make some decisions of his own. He is the only survivor of the 6 sons of Ram Shankar. Fundamentally, he is now required to distribute his father’s estate and cease to be trustee. The beneficiaries now claiming under the estate are not people for whom his father intended him to be a trustee.

The Plaintiff self-valued the wooden house at $22,000.00. As Counsel for the Defendant pointed out there is no evidence whether this is a proper valuation or not. The Plaintiff in submissions of her Counsel abandoned any claims to the house since its value will be included in her husband’s share when it is given to her. In the meantime the house enhances the market value of the property. She once wanted to remove it but clearly the Defendant made that difficult by requiring that she get the consent of all other beneficiaries. She now no longer has a use for it.

I therefore make the following orders:

1. The Defendant must immediately wind up and distribute the estate of Ram Shankar Singh.
   
2. The Defendant must pay to the Plaintiff the sum of $52,500.00. This order is in additional to and is independent of the previous order.
   

The Defendant has been seriously at fault. He must pay substantial costs to the Plaintiff. I shall assess quantum at the next hearing if Counsel have not agreed.

3. The Defendant must comply with these orders within 4 months or else offer to the Court a convincing explanation for not having done so. The matter will be called for appearances by both Counsel on 27 January 2006.
   

D.D. Finnigan
JUDGE

At Lautoka
29 September 2005