Chand v Sharma [1979] FJSC 70; Action 212 of 1978 (12 October 1979)

IN THE SUPREME COURT OF FIJI
(WESTERN DIVISION)
AT LAUTOKA
CIVIL JURISDICTION

Action No. 212 of 1978

BETWEEN

PRAKASH CHAND & SURESH CHAND
both sons of Tulsi Ram
Plaintiffs

AND

RAM KUMAR SHARMA
son of Jagpat Maharaj
Defendant

Mr. S. Verma, Counsel for the Plaintiffs
Mr. B.C. Patel, Counsel for the Defendant

JUDGMENT

The Plaintiffs, as tenants, claim $3,875 from their former landlord (the defendant) alleging it was rent paid in excess of the lawful rent contrary to provisions of the Counter Inflation Act 1973.

I am satisfied that the shop was already empty and vacated by the former tenants when the plaintiffs approached the defendant and discussed rental terms. It is not denied that the former rent had been paid $100 per month. The plaintiffs paid $255 per month from May 1976 to May 1978, a period of 25 months.

It is admitted that on 26/4/78 the defendant was fined $50.00 in the magistrate's court for increasing the rent without P.I.B. approval. But the written statement of defence denies liability on the ground that the plaintiffs had been aware of the former rent and had agreed to the increase and therefore were "in pari delicto."

In evidence the plaintiff denied that the defendant had told him that the former tenant had paid less then $225 per month. He says that after he had been in occupation for about 4 months he met the former tenants and learned that they had paid $100.00 per month. He then notified the P.I.B.

In cross-examination he explained his two years tenancy at an excess rent by stating that it took time for the P.I.B. to institute proceedings against the defendant. During that period the plaintiff could not be 'in pari delicto" because it would only be a conviction of the defendant that any overcharging would be established; unless of course the plaintiff was aware from the beginning that the rent had been unlawfully increased.

The defendant alleges that the plaintiff was aware of the increase. He states that he had heard of a Supreme Court ruling that such increases were not unlawful. His list of authorities includes Ambika Prasad Sharma v. P.I.B.; Suva Cr. App. 92/76 in which it was ruled that on a re-letting it was not unlawful to increase the rent. In suggesting that he relied upon that decision when increasing the rent in May 1976 the defendant renders his credibility rather dubious. The decision on which the defendant says he relied was not delivered until 25th March 1977. Consequently the defendant could not have relied upon it. The decision in Cr. Appeal 92/76 was overruled by the F.C.A.

On balance I prefer the evidence of the plaintiff and I find that the plaintiff was not aware of the lawful rent when he went into occupation of the shop.

Mr. Sharma, for the plaintiff, stated that the Act made no provision for the recovery of rent which has been overpaid and explained that the plaintiff's claim was based on common law rights.

Mr. B.C. Patel for the defendant argued that the object of the Act is to counter inflation and not to protect tenants. An increase of 150% in rent is no doubt inflationary and although the object is not simply to protect tenants the Act will scarcely achieve its object if the landlord cannot be caused to deliver up his illegal profit.

S.28 of the Act provides that over-payments can be recovered provided the person who paid had not aided and abetted the overcharging. Mr. B.C Patel argues that S.28 would not apply because it makes no reference to rent and that rent is not defined in the Act. According to S.28 the amount recoverable is the excess above "that fixed and declared under the provisions of this Act." From time to time the fixed prices of numerous commodities are scheduled in the Gazette by the P.I.B. but it must be obvious that there can be no such schedule published in relation to rents payable.

Under S.15(1) a landlord must give the P.I.B. six weeks' notice of his intention to increase the rent if the P.I.B. has issued an order to that effect. Such an order issued in 1973 and S.15(2) provides that implementation of an increase of rent before the P.I.B. has considered it is a contravention of the order. The defendant was convicted for such a contravention.

The Act refers to rents but S. 28 only refers to "prices and charges" and S.2 which defines "prices and charges" does not define rents nor does the word appear anywhere in the definition section.

However, as is pointed out in Kiriri Cotton Co. Ltd. v. DEWANI, 1960 1 A.E.R 177, where the parties are not "in pari delicto" such overpayments can be recovered if the duty of avoiding the over-charging is placed upon one rather than another. In the instant case the duty to observe the Act and charge a rent which P.I.B. has not disapproved rests on the defendant as landlord. Accordingly the overpayments are recoverable as money had and received.

There will be judgment for the plaintiff in the sum of $3,875.00 with the costs hereof.

(Sgd.) J.T. Williams
JUDGE

LAUTOKA,
12th day of October, 1979.