Taiyab v Native Land Trust Board [2012] FJHC 1454; HBA2.2011 (27 November 2012)

IN THE HIGH COURT OF FIJI
AT SUVA
APPELLATE JURISDICTION

Civil Appeal No: HBA 02 OF 2011

BETWEEN:

MOHAMMED TAIYAB
Appellant

AND:

NATIVE LAND TRUST BOARD
Respondent

Counsel : Mr. S. Kumar for the Appellant
Ms. L. Komaitai for the Respondent

Date of Judgment: 27.11.12

JUDGMENT

[1]. This is an appeal by the appellant (hereinafter referred to as the plaintiff) from a judgment dated 06.04.2010 of the learned Magistrate at Nausori.

Background to the facts

[2]. On the 30th June 2008 the plaintiff approached the Mataqali Uluikuku Vunimono to get a piece of land to build a house. Subsequently, the plaintiff was given a land by the Mataqali headman.

[3]. The plaintiff was also given a consent form signed by all members of Mataqali and on 3rd July 2008 the plaintiff lodged an application with the necessary prerequisite fee. Thereafter, the plaintiff built a wooden and iron house on the land.

[4]. The plaintiff submitted an application for a lease to the NLTB and also was issued with a letter by the NLTB to get the electricity connection to the house. The defendant also gave the plaintiff 6 months to formalise his occupation by obtaining a lease.

[5]. Despite the plaintiff had done all that was necessary to obtain the lease from the defendant on 26.06.2009, the plaintiff received a Notice of unlawful occupation signed by Solomoni Nata an officer from the NLTB asking the plaintiff to vacate the land in question.

[6]. Having been aggrieved by the NLTB order the plaintiff filed a writ of summons in the Magistrate's Court.

[7]. In the Magistrate's Court, the plaintiff sought following relief against the respondent (hereinafter referred to as the defendant):

1. An injunction restraining the defendant his servants or agents from entering the plaintiff's premises or interfering or obstructing the plaintiff for the peaceful and exclusive possession of his house and land allocated by the land owners and or in alternative;
   
2. Damages in the sum of $ 46390.00;
   

100. Interest rate at the rate of 10% from 3rd July 2008 till the date of judgment; and,
     

4. Costs.
   

[8]. Having heard the case, the Magistrate delivered his judgment dismissing the plaintiff's claim against the defendant. It is against that judgment the plaintiff has filed this appeal.

[9]. The plaintiff raised 8 grounds of appeal, but I do not intend to deal with each and every ground individually instead will discuss most important grounds.

[10]. The first ground of appeal advanced by the plaintiff is that the magistrate erred in law and in fact not considering and evaluating the affidavit evidence of the plaintiff when there was no affidavit in reply filed by the defendant. It could be observed in the case record that the plaintiff filed an affidavit in support of an inter-partes motion filed on 09.09.2011 seeking some interim relief. The defendant did not file its affidavit in response. The learned Magistrate granted orders in terms of the inter partes motion.

[11]. It must be noted that the said affidavit was filed in support of the inter partes motion but not in support of the substantive matter thus, failure to respond by the defendant in any way should not and could not affect the outcome of the substantive matter since it was decided after examining the witnesses called by both parties. Further, it must be noted that though the defendant failed to file affidavit in response that does not take the burden of proof away from the plaintiff. Therefore, I do not see any merit on the plaintiff's first ground of appeal.

[12]. The 2nd and 3rd grounds of appeal advanced by the plaintiff relates to equitable interest and proprietary estoppels. The plaintiff argued that the learned Magistrate erred in law and in fact in not coming to the conclusion that the plaintiff had an equitable interest on the land and also had proprietary estoppels against the defendant.

[13]. Both the abovementioned grounds are related to equity. A court of equity refuses to a claimant whose conduct in regard to the subject matter of the litigation has been improper. In other words, the plaintiff in equity must come with perfect propriety of conduct or with clean hands.

[14]. One of the main grounds advanced by the plaintiff is that the defence of proprietary estoppel is available for the plaintiff against the defendant.

[15]. In Thorner v. Major [2009] UKHL 18; [2009] 1 WLR 776, three main elements upon which the doctrine of proprietary estoppels is based are stated by Lord Walker as follows:

1. A representation or assurance made to the claimant
2. Reliance on it by the claimant

100. Detriment to the claimant in consequence of his (reasonable) reliance.
     

[16]. One further characteristic of proprietary estoppels to note was described by Hoffman LJ (as he thenwas) in Walton v. Walton [1994] CA Transcript No. 479 as follows:

'But none of this reasoning applies to equitable estoppels, because it does not look forward into the future and guess what might happen. It looks backwards from the moment when the promise falls due to be performed and asks whether, in the circumstances which have actually happened, it would be unconscionable for the promise not to be kept.'

[17]. in Denny v. Jensen [1977] 1 NZLR 635 at 638 White J. set out 4 conditions that must be satisfied before proprietary estoppels apply as follows:

'The general rule, however is that "liabilities are not to be forced upon people behind their backs" and four conditions must be satisfied before proprietary estoppels applies. There must be an expenditure, a mistaken belief, conscious silence on the part of the owner of the land and no bar to the equity.'

[18]. In light of the above case, it is important to analyse whether the present case has those characteristics.

An Expenditure

[19]. In Greasley v. Cooke [1980] 1 WLR 1306 at 1313/1314, Dunn LJ stated:

'There is no doubt that for property estoppels to arise the person claiming must have incurred expenditure or otherwise have prejudiced himself or acted to his detriment."

[20]. Needless to say that the plaintiff has spent a reasonable amount in constructing the house. The evidence before the Magistrate's court clearly shows that the plaintiff has cleared the land, developed it and built the house which was not challenged by the defendants. Although, the exact amount spent by the plaintiff was not specifically proved, it is apparent that a considerable sum would have been spent by the plaintiff to complete the house.

A mistaken belief

[21]. In deciding this component there needs to be an investigation of facts on the issue of mistake and whether the plaintiff believed that the defendant had given consent, the basis for his belief and also the defendant conduct that may have given rise to that belief.

[22]. It must further be analysed whether the plaintiff was under the mistaken belief that he could built a house on the land and would be granted the lease by the defendant when he formalised other requirements.

[23]. In his evidence in chief the plaintiff stated that a NLTB officer came four times and checked the house which was under construction. This evidence remains unchallenged.

[24]. The plaintiff's 2nd witness Veera Chand also stated in his examination in chief that he was employed by the plaintiff to build the house, an officer from NLTB came and asked the plaintiff to get the offer letter and also the plaintiff was not informed that it was illegal.

[25]. The above witness was not even cross examined by the defendant at the Magistrate Court trial.

[26]. In addition to that the plaintiff's wife's evidence also corroborated the plaintiffs' position and she infact identified the defence witness Tevita as the officer who came to check the progress.

[27]. It could be observed in the learned Magistrate's judgment that he has not analysed the plaintiffs evidence properly and also failed to pay due attention to the unchallenged evidence of the plaintiff and other two witnesses who gave evidence for the plaintiffs claim.

[28]. More importantly, the learned Magistrate has not considered the discrepancies which are discernible in the defence witnesses evidence in chief and evidence in cross examination.

[29]. In his evidence in chief the estate officer from NLTB clearly stated that he visited the plaintiff and asked him who gave him the permission to build. He further admitted that the plaintiff had complied with the defendant's request within six months and had the land was not leased, the NLTB would have given the plaintiff the land.

[30]. The most important fact which the learned Magistrate has failed to take into account is that though the defendant's estate officer had met plaintiff on several occasions the plaintiff was never informed the fact that the land in question had already been leased to another person in 2007, which further demonstrates that the plaintiff had every reason to believe that the NLTB would grant him the lease and he could build a house and live on the land. Because of that mistaken belief the plaintiff went on to complete the construction of his house on the land in question.

[31]. In Inwards –v- Baker [1965] 2QB 29 Lord Denning MR dealt with a similar issue as follows:

'So in this case, even though there is no binding contract to grant any particular interest to the licensee, nevertheless the court can look at the circumstances and see whether there is an equity arising out of the expenditure of money. All that is necessary is that the licensee should, at the request or with the encouragement of the land lord have spent the money in the expectation of being allowed to stay there. If so, the court will not allow that expectation to be defeated where it would be inequitable so to do.'

He further stated:

'It is an equity well recognised in law. it arises from the expenditure of money by a person in actual occupation of land when he is led to believe that as, the result of that expenditure, he will be allowed to remain there.'

[32]. In the present case it is quite plain that the defendant's conduct created an expectation in the plaintiff's mind that the plaintiff would be granted the lease and the house was to be his home.

Conscious Silence

[33]. The defendants' evidence before the Magistrate court amply demonstrates that neither the defendant nor the Mataqali had ever objected the construction.

[34]. It is inconceivable to infer that the plaintiff had spent a quite substantial sum to construct a house, had he been informed in advance by the defendant not to construct and likelihood of eviction in the event if the NLTB refused to grant the lease.

[35]. The letter issued by the defendant consenting for electricity connection though conditional further made the plaintiff to believe that he could get the lease once the formalities were complied with. In fact the defendant's witness admitted the fact that the plaintiff had complied with formalities.

[36]. The above facts leads to an inevitable conclusion that both the defendant and Mataqali either remained silence or at least did not object for the construction carried out by the plaintiff thus the third requirement in proprietary estoppels is also proved.

No bar to equity

[37]. The most important, if not the decisive, factor to be considered in considering the defence of proprietary estoppel is whether the plaintiff is precluded from claiming an equitable relief since he failed to comply with a statutory requirement i.e. the failure to comply with section 12 of the Native Land Trust Act.

[38]. As can be seen from the learned Magistrate's judgment, he mainly relied on section 4(1) and section 12(1) of the Native Land Trust Act and came to a conclusion that the plaintiff had built the house on the native land without the consent of the NLTB and on that premise dismissed the plaintiffs' action.

[39]. The appellant argued that if the land is not leased to anyone then the Mataqali could give that land without the approval of the NLTB. It was further argued that had the NLTB leased the land on 1.1.2007 to Manoa, NLTB should have informed the appellant about that and failure to do so by the defendant make the appellant entitled to have a remedy under the law of equity.

[40]. In this matter the evidence led before the Magistrate clearly shows that the NLTB had never informed the plaintiff the fact that the land in question had already been leased out to a person named Manoa. Further, the NLTB had accepted the plaintiff's application for lease and also issued him with a consent letter to get the electricity connection without informing the plaintiff about the existing lease. Therefore, in my view the plaintiff had a reasonable and legitimate expectation that his application for lease would be granted by the NLTB.

[41]. Had there been a lease over the property, the NLTB should not have given the plaintiff six months to formalize his occupation by obtaining a lease from the NLTB.

[42]. The defendants further rely on section 4(1) and 12(1) of the Native Land Trust Act.

[43]. The appellant argued that Section 12 (1) does not apply to the appellant as he is not the lessee and or there is pre existing lease. It was further argued that Section 12 (1) applies only to existing lessee and not to the aspiring lessee.

[44]. According to Section 12 (1) no dealing in respect of a native land can be done without the consent of the NLTB.

Section 12(1) reads:

Except as may be otherwise provided by regulations made hereunder, it shall not be lawful for any lessee under this Act to alienate or deal with the land comprised in his lease or any part thereof, whether by sale, transfer or sublease or in any other manner whatsoever without the consent of the Board as lessor first had obtained. The granting or withholding of consent shall be in the absolute discretion of the Board, and any sale, transfer, sublease or other unlawful alienation or dealing effected without such consent shall be null and void.

[45]. In light of the above section, it is very clear that any dealing with the land by the lessee without the consent of the Board is unlawful. The purpose of the Native Land Trust Act is to make sure that all native lands shall be administered for the benefit of Fijian owners. Hence, it is obvious that whoever intends to deal with a native land should first get the consent of the Board. Although, Section 12(1) of the Act referrers only to a lessee it does not mean that a person other than a lessee could deal with a native land without the consent of the Native Land Trust Board. The objective of the Act is explicit; that it is designed to administer native lands for the benefit of Fijian owners. Therefore, any act stipulated in Section 12(1), if done without the consent of the Board shall be unlawful irrespective of by whom it was done.

[46]. The defendants further submitted that the plaintiff is not entitled to have a remedy under the law of equity since he had built the house without the consent of the NLTB and thereby breached the law. The defendant placed much reliance on Chalmers –v- Pardoe [1963] 3 AER 552.

[47]. In Chalmers v. Pardoe [1963] 1 W.L.R. 677, it was held that:

1. In the circumstances equity would, apart from statutory prohibition, have intervened and prevented P. obtaining for nothing the buildings that C had erected but;
   
2. The arrangement between P and C coupled with the erection of the building by C constituted dealing with the land and since the consent of the Board was not obtained, the dealing was unlawful under the ordinance and the court was precluded from lending its aid to C.
   

In that judgment, Lord Terence Donovan further stated:

'Even treating the matter simply as one where a licence to occupy coupled with possession was given, all for the purpose, as Mr. Chalmers and Mr. Pardoe well knew, of erecting a dwelling house and accessory buildings, it seems to their lordships that, when this purpose was carried into effect, a dealing with the land took place. On this point their lordships are in accord with the Court of Appeal: and since the prior consent of the Board was not obtained it follows that under the terms of section 12 of the ordinance cap 104, this dealing with the land was unlawful. It is true that in Harnam Singh and Blackshishsingh v. Bawasingh the Court of Appeal said that it would be an absurdity to say that a mere agreement to deal with land would contravene section 12, for there must necessarily be some prior agreement in all such cases. Otherwise there would be nothing for which to seek the Beard's consent. In the present case, however, there was not merely agreement, but, on one side, full performance: and the Board found itself with six more buildings on the land without having the opportunity of considering beforehand whether this was desirable. It would seem to their lordships that this is one of the things that section 12 was designed to prevent. True it is that, confronted with the new buildings, the Board as lessor extracted additional rent from Mr. Pardoe, but Whatever effect this might have on the remedies the Board would otherwise have against Mr. Pardoe under the lease, it cannot make lawful that which the ordinance declares to be unlawful.

Their lordships after full and anxious consideration of the whole matter have reached the same conclusion as the Court of Appeal, namely, that a dealing in the land took place here without the prior consent of the Board as required by section 12 of the ordnance: that the dealing was accordingly unlawful: and that in these circumstances equity cannot lend its aid to Mr. Chalmers. (Emphasis added).

[48]. However, it is my view that Chalmers v. Pardoe (supra) can clearly be distinguished from the present case. In Chalmers, the dealing of the land was between two private individuals and there was no evidence that the NLTB was aware of the dealings.

[49]. To explain further, in the present case, the NLTB and the Mataqali members played an active role in allowing the plaintiff to build the house whereas, in Chalmers the dealing took place subsequent to a friendly arrangement.

[50]. In the present case, although the plaintiff's initial dealing with the Mataqali was in contravention of Section 12 (1) of the Act, not only the Mataqali but also the NLTB conducted themselves in such a manner that the plaintiff would have apprehended that he would be granted the lease once the formalities are complied with.

[51]. Since the plaintiff was made to believe by the conduct of the defendant and Mataqali that he was doing nothing unlawful, it is my considered view that court has to adopt a liberal approach in deciding whether the plaintiff is entitled to claim a relief on equity.

[52]. Had the NLTB informed the plaintiff at the inception that he could not built a house without the consent of the NLTB or had the plaintiff commenced constructions without the knowledge of the NLTB and Mataqali undoubtedly, the plaintiff could not have sought a relief on equity.

[53]. In the instant case, the NLTB not only failed to object the plaintiff when the house was being built but also failed to inform him that the land had already been leased to a person called Manoa. In addition to that, the NLTB had asked the plaintiff to formalise the other requirements in order to get the lease.

[54]. It emerged from the evidence, that until the completion of the house, the plaintiff had not been informed the fact that the land had been leased to another person by the defendant nor had the plaintiff been informed by the defendant that it was unlawful to construct the house without the consent of the Board.

[55]. The evidence before the Magistrate's Court clearly established that the plaintiff with the knowledge and implied consent of the NLTB had constructed the house on the land, and also had a legitimate expectation that the lease would be granted to him.

[56]. Therefore, merely because the plaintiff has failed to comply with Section 12 of the Act he should not in my view be precluded from seeking a redress on equity, because the prior and subsequent conduct of the NLTB and Mataqali would definitely have made the plaintiff to believe that he had not acted in unlawful manner in constructing the house.

[57]. The NLTB being the sole authority whose prime objective is to administer native lands for the benefit of Fijian owners has failed to act with due care and responsibility. The facts of the present case amply demonstrate the irresponsible and negligent conduct of the NLTB in discharging its duties. Hence, it is my considered view that NLTB's conduct was unconscionable and sufficient to give rise to an estoppel preventing it from denying the plaintiff to claim damages or compensation for the expenditure accrued to him.

[58]. In the present case the Mataqali as well as the NLTB have encouraged the plaintiff to expend money on the land in question on the faith of an assurance or promise that land would be leased to the plaintiff, thus general equitable principle must apply and the NLTB is precluded from denying that the plaintiff had an equity in the land.

[59]. Further, it is evident that both the NLTB and Mataqali were directly involved in allowing the plaintiff to construct the house on the land in question despite the fact that it had already been leased to a person named Manoa. Conducts of this nature by the NLTB are too often found, which in my view should not be allowed to go unremedied.

[60]. Hence, it would be an unjust exercise if the NLTB is allowed to escape the consequences of their irresponsible and negligent actions. Therefore, the plaintiff is entitled to be compensated by the NLTB in lieu of issuing the lease to the plaintiff.

[61]. Upon consideration of the above, I conclude that the defendant NLTB is liable to pay damages for plaintiff appellant. Therefore, I set aside the judgment delivered by the learned Magistrate on 06.04.2010 and allow the plaintiff's appeal.

[62]. Accordingly, I direct the Registry to place the matter before the Master of the High Court for the purpose of assessing damages.

[63]. Costs are to be taxed if not agreed.

Pradeep Hettiarachchi
JUDGE