Momoivalu v Ratu [2006] FJHC 123; HC HBC0227J.2003S (24 February 2006)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC0227J OF 2003S

BETWEEN

SOLOMONE MOMOIVALU
also known as SOLOMONE MARLBROUGH MOMOIVALU
and JOANA MOMOIVALU
of Lot 64 Vunakece Road, Namadi Heights,
Tamavua Development Manager and Assessor respectively.
PLAINTIFF

AND

ATUNAISA TAGIVAVA RATU
also known as ATUNAISA TUKANA
of Lot 70 on DP 3751, 6 Beddoes Road, Samabula.
DEFENDANT

Counsel for the Plaintiff: Defendant:

S. Chandra Ms B. Devi In Person

) Maharaj Chandra & ) Associates

Date of Judgment: 24.02.06
Time of Judgment: 9.30 a.m.

JUDGMENT

This is a section 169 application.

The land in question is an estate in fee simple containing twenty four perches more particularly described as Lot 70 on D.P. 3751 situated in Suva at 6 Beddoes Street, Samabula and comprised in C.T. 19281. The Plaintiff's had, on 25^th June 2002, purchased the property from one Venkat Naidu f/n Changaiya Naidu, the previous registered proprietor. The transfer was registered on 30 September 2002. There is a double story concrete residential home built on the property. The defendant presently occupies the residence.

In seeking the order for vacant possession the Plaintiff's argue that the Defendant, whilst a tenant of the former owner of the property, no longer has any right to remain. He had been given the notice to vacate the property following its purchase by the Plaintiffs in a letter dated 31 March 2003. He refused to move out.

The Defendant's defence is premised on equitable grounds. In his affidavit, the Defendant says that not only was he a tenant of the former owner of the property, but he had entered into a sale and purchase agreement with Venkat Naidu. The previous owner's for him to purchase the property for the price of $110,000.00. The said agreement dated 3 January 2002 attached to the Defendant's affidavit specifically stated, that:

"WHEREAS: Mr Venkat Naidu owner of the property situated at 6 Beddoes Road, Samabula wish to sell Atunaisa the said property for the sum of $110,000.00 after his compensation case.

PENALTY CLAUSE: Breach of the above Agreement by either party will incur a penalty of $20,000.00 payable by the person breaking the agreement to the other."

In his submission the Defendant clarified that the "compensation" mentioned in the agreement, referred to compensation that the employer, Ports Authority of Fiji was paying him and which was to go to the purchaser of the property. He was informed first by Venkat Naidu on the 10 September 2002, and then by Mr Naidu with the first-named Plaintiff a day later that the property had been sold to the Plaintiffs.

According to the Defendant, he subsequently lodged a caveat against the property on 9 October, but this was not registered in time. He alleged collision on the part Venkat Naidu, the Plaintiffs and the Registrar of Titles, which resulted in the registration of the transfer dealing of the property to the Plaintiffs in priority over his caveat dealing. This allegation of fraud is the subject of High Court action CA No. HBC0154.2003.

For the Plaintiffs, the arguments are straightforward. They are purchase for value without notice or any knowledge of the allegations of fraud. They had inherited a good title to the property, a title which is unimpeachable or indefeasible under law. They in particular, refer to sections 38 and 39 of the Land Transfer Act (Cap. 131) which guarantees them a good title.

The evidence before me supports the Plaintiffs submission. They had obtained a clear title to the property from the previous owner Vankat Naidu on 25 June 2002 for valuable consideration. The only circumstance in which the Plaintiff's title could be impeached would be on proof of fraud on their part. As the Court of Appeal stated in Raghupal Singh -v- Chabildas & Or. FCA 42/1978, the statutory provisions namely sections 38 and 39 of the Act, confer upon a registered proprietor an indefeasible title, and that in the absence of fraud no one can assert his or her interest against the registered proprietor who had taken the registered title free from any such interest.

As to the standard of proof of fraud required, the Court of Appeal in Darshan Singh -v- Puran Singh FCA 22/1997, stated that:

"There must, in our view, be some evidence in support of the allegation indicating the need for fuller investigation which would make s.169 procedure unsatisfactory. In the present case the appellant merely assert that he had paid money for the purchase of the property. This was denied... There was nothing whatsoever before the learned judge to support the existence of any evidence, documentary or oral, that might possibly assist the appellant in establishing fraud at a full trial."

In this case, the Defendant's allegation or fraud is against the previous owner, The Plaintiffs, and the Registrar or Titles for what he termed as "manipulating the priority of the dealings on the face of the title." There is no direct evidence to support this, except That the Defendant has attached a copy of his other High Court Writ CA 154/2003) which described what he termed as The alteration of priorities in the registration of dealings in the Registry of Titles.

There is no evidence before this Court to prove that The Plaintiffs had any knowledge of the allegations of fraud or fraudulent conduct which the Defendant say occurred during the registration of the dealings. The fact that the Plaintiffs were to be registered as the new proprietors, does not of itself impute fraud on their part, for whatever action taken by the Registrar of Titles. I here must exist clear evidence, written, or oral, that implicates the Plaintiffs and which in turn would convince the Court that the s.169 procedure is not appropriate. In this instance, there is none.

In summary, the Defendant's case is premised on a prior agreement between himself and the previous owner or the property Venkat Naidu, which the Defendant claims, Mr Naidu had breached when he sold the property to the Plaintiffs. In this regard, the Defendant has taken the correct recourse for the alleged breach of contract by bringing civil action 154/2003.

The Agreement itself is legally deficient in many ways which may make if unenforceable in the end, but even it were deemed otherwise, then the provision of the Agreement relating to its breach, by any or the parties, would apply. Specifically, the Agreement stipulated that a penalty of $20,000.00 is payable by any one of the parties that is in breach of the Agreement. In the context of the circumstances of this case, the Defendant would have claimed the protection of this provision, and claim $20,000.00 compensation, In other words, in the absence of fraud, And given the finding that the Plaintiffs had an indefeasible title, then the Defendant's only redress is in damages against the previous owner for breach of the agreement, the enforceability of which is yet to be proven.

Counsel for the Plaintiffs correctly pointed out that they are not bound by the agreement of 3 January 2002. It was strictly between Venkat Naidu and the Defendant. Even if the Plaintiff's were aware of the previous intention of Mr Naidu to sell the property to another party, the law does not require the Plaintiffs to inquire or ascertain in any greater details of its circumstances. It is enough that the Plaintiffs had satisfied themselves that the Land was free of any encumbrances. That being the case, they were entitled to take a transfer from the registered proprietor without notice.

There are two other arguments raised by the Defendant. First is his submission that the decision of this Court should await the outcome of CA 154/2003 in which then allegation of fraud is made against the previous registered proprietor the Plaintiffs and the Registrar of Title. The Court had already found little or no evidence to support the allegation that the Plaintiffs were guilty of fraud or a fraudulent act in the changes in the sequence of the registration of dealings which, according to the Defendant occurred at the office of the Registrar of Titles. This proceedings is summary in intent and form. Once the Court is satisfied that the person summoned under s. 169 has failed to show cause why he should not give up possession of the property the Court will order immediate possession to be given to the Plaintiff. The right to immediate vacant possession under the said provisions cannot be thwarted simply because the Defendant has other proceedings on the same matter elsewhere. The Court of Appeal in Dimesh Jamnadas & Or. -v- Honson Limited (1965) 31 FLR 62, had ruled on a similar submission to that of the Defendant that

"... the existence of such proceedings was, by itself, not a cause sufficient to resist an application under section 169 of the Land Transfer Act."

Finally the Defendant submitted that he had spent about $13,000.00 in improvements on the property. This claim is properly addressed during the hearing of CA 154/2003, when the quantum of damages, if granted, will be assessed.

In the end, I am satisfied that the Defendant has failed to show cause why he should not give up possession to the property. Order is made for vacant possession.

Costs is summarily fixed at $200.00 against the Defendant.

F. JITOKO
JUDGE

At Suva
24 February 2006