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High Court of Fiji |
IN THE HIGH COURT OF FIJI ISLANDS
AT SUVA
CIVIL JURISDICTION
Civil Action No: HPP 08 of 2006
BETWEEN:
DINESHWAR NARAYAN
Plaintiff
AND:
PUSHPA WATI
1st Defendant
THE REGISTRAR OF TITLES
2nd Defendant
Counsel: Sherani & Co for the Plaintiff.
Kohli & Singh for the Defendant.
Date of Ruling: 12th November, 2010
RULING
In this matter the plaintiff supported 3 applications namely, application for order for committal, application for consolidation of HBC 359/2008 with the present action and also an application for removal of the 1st defendant as an executrix of the estate of the deceased.
Chronology of Events:
The plaintiff filed Originating Summons dated 27.02.2006 seeking following relief:
On 21.08.2006 Justice Singh delivered his Judgment, and ordered as follows:
Then the plaintiff filed summons dated 17.11.2008 seeking following relief.
Again, on 28.01.2009 the plaintiff filed ex parte motion seeking following relief.
until the final determination of the court action file here in and or until further order of the court.
Having heard the ex parte motion, Justice Jitoko on 02.02.2009, made following orders:
Until the final determination of the Court action filed herein and or until further of the court.
The plaintiff alleges that despite the court order the 1st defendant had got the caveat removed and thereby had acted in breach of the court order. Subsequently, the plaintiff filed a motion dated 13.02.2009 seeking following relief.
Background to the case:
The plaintiff Dineshwar Narayan is the only child of late Deo Narayan and Savita Devi Narayan. They were the joint tenants of CT 7279. Upon the death of Deo Narayan, Savita Devi became the sole owner of CT 7279.Savitha Devi died on 12.12.2002, leaving a Will dated 25.09.2001.
Pursuant to a Probate No 4146, Pushpa Wati the 1st defendant was appointed as the sole Executrix and Trustee of the said Will.
After Justice Singh's judgment 21.08.2006, the 1st defendant has sold the CT 7279 to one Ajay Narayan who is also a beneficiary under the Will.
Plaintiff in his affidavit stated that, the Last Will directs CT 7279 to be subdivided into 4 blocks and the block comprising the dwelling house is to be given to one Ajey Narayan. Therefore, the plaintiff alleged that the 1st defendant as executrix has not discharged her duties diligently and asks that the 1st defendant be removed as the executrix of the estate.
I will first consider the application for granting an order for committal.
At the time of the deceased's death there existed a Caveat lodged by Suva City Council, due to non payment of city rates.
On 24.11.2003, the plaintiff also lodged the Caveat No 534069 on CT 7279.
Justice Singh's judgment dated 21.08.2006, required the caveat 534069 on the CT 7279 remain in force. However, the 1st defendant managed to get the caveat 534069 removed and sell the CT 7279 to Ajay Narayan.
In his affidavit the plaintiff stated that, despite the said judgment of Justice Singh, the 1st defendant, the 2nd defendant and Ajay Narayan colluded and transferred the said property comprised in CT 7279 to Ajay Narayan. The transfer of the CT 7279 was done on 15.10.2007.
On 24.01.2008 the property was further transferred by Ajay Narayan to his wife Shiu Karen and his two sons namely A.R.Narayan and P.A.Narayanin.
The main issue to be considered in granting an order for committal against the 1st and the 2nd defendant is whether they have acted in breach of the court order dated 21.08.2006.
The plaintiff alleged that the removal of the caveat and the subsequent transfer of the CT 7279 by the 1st defendant to Ajay Narayan are amount to contempt because the court had ordered to maintain the caveat on CT 7279 until the substantive mater was determined.
1st defendant's contention is that since the Order on judgment has not been served on the 1st defendant she cannot be charged for contempt.
The 2nd defendant is the Registrar of Titles. It was submitted on behalf of the 2nd defendant that being a government institution, no committal orders can be granted against the 2nd defendant.
Order 77 Rule 11 (1) of the High Court Rules reads:
Nothing in Order 45 to 52 shall apply in respect of any order against the State
Pursuant to the above section no committal order can be issued against the state. Therefore, I conclude that committal orders cannot
be issued against the 2nd defendant.
In this matter, the plaintiff admits that the order was not served on the defendants. He further admits that the judgment dated 21.08.2006
and court order dated 26.09.2006 were both not registered on CT 7279.
The plaintiff submitted that even if the order was not served on the defendants still they can be charged for contempt, since the defendants were represented by their solicitors, and copies of the judgment were given to them in open courts when the judgment was delivered. It was further submitted that the defendants were aware of the judgment and hence, they are obliged to abstain from removing caveat on CT 7279.
The relevant legal provisions on this issue are contained in Order 42 of the High Court Rules.
For convenience I reproduce the relevant parts of the Order 42 which reads thus:
Order 42 Rule 4:
(1) A judgment or order of the court takes effect from the day of its date.
(2) Such a judgment or order shall be dated as of the day on which it is pronounced, given or made, unless the Court orders it to be dated as of some other earlier or later day, in which case it shall be dated as of that other day.
Order 42 Rule 5:
Subject to paragraph (2), every order of the court shall be drawn up unless the Court otherwise directs.
Order 42 Rule 8:
The party entering judgment must serve copy of the sealed judgment on every other party not later than 14 days after entry of the judgment.
In this action the plaintiff has failed to serve a copy of the sealed judgment on defendants. What the plaintiff attempts to establish is that the service of justice Sing's judgment in court is sufficient for the purpose of commence committal proceedings against defendants.
Therefore, court has to determine whether the defendants can be charged for contempt for removing the caveat when neither the court order nor the penal notice was served on them.
The plaintiff in his written submission has laid great stress on Order 45 of the High Court Rules. Order 45 deals with enforcement of judgments and orders. The plaintiff also cited the explanatory paragraph in Order45 Rule 5 of the White Book and emphasised on Isaacs v. Robertson[1985] A.C 97. But it appears that the facts of that case can easily be distinguished from the facts of the instant case because the former deals with a situation where the order is irregular.
The plaintiff further cites ABC and Others v. CDE and others [2009] All E.R. 29, but it appears to this court that the said judgment discuss the intention of the contemnor whereas, the issue in the present action is the non serving of the order on the defendant.
The written submission made on behalf of the plaintiff contains extracts from several decide cases but none of those cases support the plaintiff's contention.
The Fiji Court of Appeal has decided in several cases that the serving of the order together with the penal notice is an indispensable requirement, and failure to do so is fatal to the issuing of committal orders.
The importance of complying with requirements stipulated in Order 45 Rule 6 (4) was stated in BDO Auckland Trustee Company Limited,v.NLTB and others [2004] HBC 442/03 as follows;
'Order 45 Rule 6 requires an indorsement with of an order with a penal notice. The purpose of the penal notice is to direct the attention of the person ordered the consequences of disobedience. Simply because the alleged contemnors are barristers and solicitors, does not mean that the requirements of the penal notice can be dispensed with. The Rule applies without exception. Its omission is fatal.'
In Shalini Sangeeta Devi v. Basanthi [2003] HPP 36/99B it was held that in committal proceedings, it was fatal not to have the penal notice indorsed in the order at the time of service. This omission cannot be cured thus making the service irregular.
In Postulka v. Postulka [1988] 34 FLR 82 Justice Fatiaki emphasised the importance of serving the penal notice on the respondent as follows:
" by the clear terms of Order 45 Rule 6(4) it is a condition precedent to the enforcement of an order of the court by way of committal that the copy of the order served on the respondent should bear an indorsement of the penal notice required by that Rule."
Having cited Stokton Football Company v. Graston [1895] UKLawRpKQB 4; (1895) 1 Q.B. 453 Justice Fatiaki further said;
"the fact that these proceedings are penal in nature and that the liberty of the respondent is at stake leads me to the conclusion that the Rules ought to be strictly complied with, and that failure to comply with them should not be lightly condoned by this Court."
In Iberian Trust Ltd v.ounders Trust and Investment Co. (1932) 2 K.B. 87 at 97 Luxmoore J stated the object of the indorsement as follows:
"The object of the indorsement is plain namely, to call to the attention of the person ordered to do the act that the result of disobedience will be to subject him to penal consequences"
The above judgments very clearly stressed the indispensable requirement of serving the order and the penal notice on the alleged contemnor.
In the present action, neither the order nor the penal notice was served on the defendants. Therefore, the defendants were not informed that they would be subjected to penal consequences, if they disobeyed the order. The defendants would have had knowledge of the judgment. But that does not mean that they were made aware of any penal consequences in the event of removing the caveat.
Therefore, I conclude that committal orders cannot be issued against the defendants.
Application for removal the 1st defendant as the executrix of the estate:
The plaintiff further seeks an order removing the executrix from administrating the estate of the deceased and be replaced her by the plaintiff. Justice Singh in his order dated 21.08.2006 has granted an injunction restraining the defendants from dealing with the property mentioned in the Last Will of the deceased.
The plaintiff alleged that the Last Will of the deceased required the 1st defendant as the executrix to subdivide the CT 7279 before it was sold. Further, the plaintiff states that the 1st defendant has not provided proper accounts of the estate to him despite several requests and also the plaintiff's consent was not obtained by the 1st defendant when CT 7279 was sold to Ajay Narayan thus the 1st defendant's actions are a deliberate breach of trust and the Will.
Furthermore, the plaintiff states that the 1st defendant could have given the plaintiff the first option to purchase the property since the plaintiff was the majority share holder.
However, a careful analysis of the said Will shows that the testator did not intend to subdivide the CT 7279 into four blocks. Clause 3 of the Will reads as follows:
(b) My 3 vacant blocks of land (more particularly described in Shedule 'A' hereto and coloured pink) at the back of my said house at 322 Princes Road, Tamavua, Suva to be sold and the sale proceed thereof to be distributed in the following manner:
(i) pay to my adopted son, Dineshwar Narayan 31% of the sale proceed.
(ii) Pay to my nephew, Abilash 25% of the sale proceed,
(iii) Pay to my niece, Usha Narayan 15% of the sale proceed,
(iv) Pay to my sister in laws namely, son Kuar, Deo Kuar and Sant Kuar each 3% of the sale proceed,
(v) Pay to other 2 nephews namely, Shalend Kant Sharma and Yogen Kant Sharma each 10% of the sale proceed.
(c) My vacant freehold commercial property at Nakasi is to be sold and the sale proceeds thereof to be distributed in the same manner as in (b) above.
(d) My vacant freehold residential property at Nakasi, Nasinu to be sold and distributed in the same manner as in (b) above.
Therefore, it could be observed that there is no specific clause in the Will which warrants CT 7279 be subdivided. The Clause 3 (a) of the Last Will referred to schedule 'A' but it does not provide for subdivision of the CT 7279.
In support of the application for the removal of the executrix, the plaintiff further states in his affidavit, that the deceased's property at Tamavua consisted of 3 bedroom house and 2x2 bedroom flat and therefore, could have fetched a rental income of $2000.00 per month but the 1st defendant failed to utilised the rental income to pay debts and legacies and also the 1st defendant has not given inventories or accounts despite several requests by the plaintiff and his solicitor.
The plaintiff further states that the titles for CT 21319 and CT 21320 are missing and the 1st defendant has failed to enquire as to their whereabouts, the 1st defendant has failed to sell the CT 21334 and divide the sale proceeds and also the 1st defendant paid $ 2000.00 to John Silta from the estate funds in breach of clause (c) of the Will.
The plaintiff has furnished a valuation report on CT 7279 for $90000.00 from Fair View Valuations on 21.02.2006.
One important issue to be considered here is whether the transfer of the CT 7279 by the 1st defendant to Ajey Narayan was in breach of the trust and a Will.
In her affidavit, the 1st defendant states that the plaintiff has purchased the shares of the other beneficiaries at a low price, without the knowledge of the 1st defendant. She further states that it was found that the estate had no cash in order to pay any testamentary expenses and therefore, she had no other alternative but to sell the CT 7279 to Ajey Narayan. It was also stated that after the payment of Suva City Council rates in the sum of $ 37431.24 the remainder of the funds in the sum of $ 52568.76 is held in trust account of Iqbal Khan Associates.
The 1st defendant's argument is that since Suva City Council had issued a writ in Civil Action 392 of 2007 and claimed the sum of $24414.00, she had to sell the land to Ajay Narayan even though there was a caveat on CT7279. She states that the Last Will did not have any clause which requires subdivision of lots. She further states that the deceased did not intend to give any real property to the plaintiff.
The 1st defendant admits that there are 2 blocks of lands being CT 21319 and CT 21320 to be sold. According to the 1st defendant, the plaintiff placed caveats on CT 21319 and CT 21320 restricting the sale. Furthermore, the 1st defendant states that CT 21334 was subjected to a civil action 468/06 and therefore, it could not be sold.
It was further stated that the CT 7279 was sold to Ajay Narayan since he was residing on the other portion of the CT 7279.
In the Last Will it was clearly stated that after bequeathing the two storied house to Ajay Narayan, the remaining part should be sold and the proceeds of the sale shall be divided among the beneficiaries in accordance with the proportion stated in the Will. It does not specifically state that the CT 7279 should be subdivided. Therefore, I am of the view that the testator did not intend to subdivide the CT 7279.
The executrix has failed to sell CT 21334 and divide the sale proceeds among the beneficiaries as directed by the Last Will. The reasons advanced by the 1st defendant to explain the delay are far from satisfactory and hence cannot be accepted. The 1st defendant being the executrix of the Estate had a duty to inform the court and seeks leave before she dealt with the CT 7279. If the first defendant wanted to find money to pay the city rates she could have informed the beneficiaries and sought their assistance. Furthermore, the 1st defendant as a trustee should have made every effort to fetch the maximum price for the CT 7279. But she chose to sell it to Ajay Narayan without giving other beneficiaries an opportunity to bid for the property. Further, the 1st defendant failed to provide inventories or accounts when requested so by the plaintiff.
In his judgment, Judge Singh has stated that it was never the intention of the testator to give the entire property to Ajay Narayan.
At the same time, it was never the intention of the testator to bequeath the entire property to the plaintiff. In any event, the testator has clearly directed to sell the CT 7279 sans the house and the land covered by the house which was bequeathed to Ajay Narayan.
Once the executrix is appointed to administer the estate of the deceased, it is the duty of the executrix so appointed, to administer the property in accordance with the directives given in the Will.
Upon careful consideration of the evidence before me and the submissions made by the counsel I find that the 1st defendant as the sole executrix of the deceased's estate has failed or neglected to administer the said property as directed by the Last Will.
Under section 35 of the Succession, Probate and Administration Act, Court has the power to remove an executor.
Section 35 reads;
The court may for any reason which appears to it to be sufficient, either upon the application of any person interested in the estate of any deceased person or of its motion on the report of the Registrar and either before or after a grant of probate has been made-
(a) make an order removing any executor of the Will of such person from office as such executor and revoking any grant of probate already made to him; and
(b) by the same or any subsequent order appoint an administrator with the wii annexed of such estate; and
(c) make such orders as it thinks fit for vesting the real and personal property of such estate in the administrator and for enabling the administrator to obtain possession or control thereof; and
(d) make such further or consequential orders as it may consider necessary in the circumstances.
For the above reasons, the plaintiff is entitled to order removing the 1st defendant as executor and appointing a reliable trustee.
This is an inevitable conclusion in the circumstances.
However, I am of the view that the plaintiff is not the most suitable person to replace the 1st defendant as the trustee.
The court's view is that an independent and professional trustee should be appointed. Therefore, I order that the Public Trustee of Fiji shall be appointed as the trustee of the estate of Savita Devi. The Public Trustee is directed to wound up the estate expeditiously.
The plaintiff's counsel in his submission has asked the court to set aside the transfer of the property by Pushpa Wati to Ajay Narayan and also to set aside the subsequent transfer of the property to his wife and two children on the basis that it was a fraudulent transaction. However, that cannot be decided in this proceeding, since the plaintiff has not sought that relief in any of the summons filed, nor has added Ajay Narayan, his wife and children as defendants to this case. Since, it involves the conduct of the 1st defendant and also of some employees in the Registrar of Titles office, there certainly are some important issues to be tried and that cannot be done by affidavit evidence alone. There has to be a writ action to determine that issue.
Consolidation of proceedings:
Order 4 rule 2 of the High Court Rules deals with consolidation of proceedings.
Order 4 Rule 2 reads:
Where two or more causes or matters are pending, then, if it appears to the court-
I consider the application for consolidation of actions. In case No 359/2008, the plaintiffs are Avinit Rup Narayan, Shiu Kiran and Pranit Ajay Narayan. The 1st defendant is the Registrar of Titles. The main relief sought in Case No 359/2008 is as follows:
'that the 1st defendant be directed to forthwith remove the endorsement of unregistered caveat lodged by the 1st defendant against Certificate of Title No 7279 being Lot 7 on deposited plan No 1551.'
The statement of claim in Case No 359/2008, says that Dineshwar Narayan, the plaintiff of the Case No 08/2006 had purported to register a Caveat on the CT 7279. In 359/2008 the property in question is CT 7279 which is also the property in question in case No.08/2006.
Upon careful consideration of the provisions of Order 4 Rule 2 of the High Court Rules, and all the documents before me I find that the action before me and the action No 359/2008 have common questions of law and facts.
However, considering the nature of the relief sought in the present application before me, I am of the view that once the main issue, i.e. whether the transfer of CT 7279 by the first defendant to Ajay Narayan and the subsequent transfer of the property to his wife and children was fraudulently done in case No 08/2006 is decided, the issue in case No. 359/2008 would not exist anymore.
In the circumstances, I order that the case no.359/2008 be stayed until the determination of case No 08/2006.
For the above reasons, I make the following orders:
Pradeep Hettiarachchi
JUDGE
At Suva
12th November, 2010
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