Wati v Maharaj [1987] FJSC 7; Civil Case 55 of 1982 (21 August 1987)

IN THE SUPREME COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No. 55 of 1982

BETWEEN:

SARAS WATI
d/o Ram Chandra
Plaintiff

AND:

PARMA NAND alias PARMA NAND MAHARAJ
s/o Sahadeo Prasad
Defendant

Mr JR Reddy, Counsel for the Plaintiff
Mr GP Shankar, Counsel for the Defendant

JUDGMENT

The plaintiff and the defendant were married from 30.5.70 to 2.12.81 when the decree nisi was granted.

The pleadings do not dispute that when the couple were married the defendant did not have any property and very little money. At least in his statement of defence the defendant admits paragraph 2 of the statement of claim which alleges that neither party had any real property when they married. This is rather significant because in his submissions defence counsel now seems to expect the Court to believe that the Vomo Street property was bought for $3000 from Puni Gounder in 1969 - that is before the marriage. That was because in spite of what is stated in the pleadings the defendant in evidence said he bought the property at the end of 1969, and because Puni Gounder, who was called as a witness for the defence, also said he sold the land in 1969. However, Puni Gounder was very vague about dates, and the defendant's credibility was very suspect.

It was certainly true that it was not until 1974 that the defendant started to build on the land, and I was much more convinced by the plaintiff's evidence, and believe her when she says that the Vomo Street property was not bought until after their marriage and was bought with the intention of forming a future home.

So I believe it to be correct that when the plaintiff and defendant married on 30.5.70 they owned no real property and had little or no ready cash.

During their marriage up until the parties divorced on 2.12.81 several properties had been acquired and put in the name of the defendant. None of them was in the name of the plaintiff.

When they were divorced the question of custody of the children was dealt with. But the matter of the division of property was not gone into. On 9.2.82, that is after the grant of the decree nisi, but before the decree absolute, these proceedings were commenced whereby the plaintiff claims that the defendant held or holds in trust for her a share in the various properties listed in the statement of claim.

These proceedings were commenced separately from the divorce proceedings and were not commenced by way of a petition in accordance with section 55 (c) of the Matrimonial Causes Act. They were initiated on the basis that a trust existed between the plaintiff and the defendant. There is no written or express trust so in this respect the plaintiff could only succeed on the basis of a constructive or implied trust.

It would perhaps have been wiser had the plaintiff combined these proceedings with the petition for divorce and for her claim to a fair share of the property to have been dealt with then in accordance with section 86 of the Act. Or even had she asked the Court to consolidate the hearing of the two actions as was done in the case of Protima Devi v Rajeshwar Singh CA 332 of 1981 and Civil Appeal No. 29 of 1985. In that case there was no argument that the action with regard to the division of property was not properly brought because it was not commenced by way of petition. Nor was there any specific application in the Supreme Court for an order under section 86 of the Matrimonial Causes Act and no reference to that section. Nevertheless, in the Protima Devi case the Court of Appeal seemed happy for it to be dealt with both on the basis of constructive trust and on the basis of section 86.

In this case during the course of the proceedings there was an application for an amendment of the pleadings to add reference to section 86 as an alternative prayer for relief and this was granted. Defence counsel has still raised the question of whether that amendment was properly permitted because the proceedings were not commenced by petition as apparently required in accordance with the Matrimonial Causes Act. Clearly the fact that a late amendment was permitted cannot be challenged. There is ample authority for that and there could be no question of the defendant being taken by surprise, because the various adjournments of the case gave the defence ample time to meet the new prayer.

As to the argument that a prayer in accordance with section 86 can only be commenced by way of a petition, that was not insisted upon in the Protima Devi case, and section 55(3)(b) does give to the Court power to give leave to bring such an application by some other means. The granting of leave to amend the prayers must imply leave also to seek the prayer by some means other than by way of petition. In so far as the proceedings were not commenced in accordance with the Matrimonial Causes Rules rule 227 provides for any want of form. And this accords with O.2 rule 1 of the Supreme Court Rules. So that in so far as the prayer asks for a declaration of trust, or constructive trust that may be dealt within accordance with the principles set out in Pettit v Pettit [1969] UKHL 5; (1970) AC 777, and Gissing v Gissing [1970] UKHL 3; (1971) AC 886 and as followed in Hayward v Giordani (1983) NZLR 140. In so far as the prayer asks for a fair division of property under the Matrimonial Causes Act, that may be dealt with in accordance with the decision in the Protima Devi case.

The factual evidence on which the court is expected to estimate what the plaintiff's share should be - if any - has been minimal and in general has been most confusing. Clearly, the plaintiff has not been in a position to give many of the details. The defendant, who should have been able to give them, has not done so, or has produced a bare minimum to support what he has said. So if I err on the side of the plaintiff the defendant has only himself to blame. Even the witnesses he called were lacking in credibility and unable to produce any supporting evidence.

As I have said the defendant's evidence is very suspect. He has revealed only those bits of evidence which he thinks might help his case, and those only at the last moment when it was clear that his failure to disclose anything was going to tell heavily against him. He has prevaricated and suffered convenient lapses of memory and where his evidence conflicts with that of the plaintiff, I have no hesitation in accepting her evidence rather than his.

And I start with the basic premise that when the parties married the defendant had no property and virtually no money and that by the time they divorced he had in his name, or had had in his name several properties. Throughout the marriage, except for a short period after the birth of the children, the plaintiff worked, and contributed largely to the household expenses and made contributions to assist the defendant in his property dealings. The marriage had bad patches as do most marriages, but I am satisfied that apart from that the plaintiff was a good wife, looking after the house and children and helping her husband as far as she could, and was not the pleasure-seeker that the defendant would have me believe. So far as there is a conflict between the evidence of the plaintiff and the evidence of the defendant, accept the plaintiff's version. So far as the defendant purports to give evidence of matter not known to the plaintiff, I consider him so lacking in credibility, so clearly untruthful that I can only attach any weight to what he says in so far as he can produce independent evidence.

I will deal first with the Vomo Street property. Although, as I have said, in his pleadings the defendant admitted that he owned no property when the parties married, he gave evidence that he had bought the Vomo Street property in 1969 - a year before the marriage. He called the man he bought the property from, Puni Gounder, to support him in this, but Puni Gounder was so vague as to dates that I could attach no weight to his evidence. If the purchase took place in 1969 it is surprising that the defendant could not produce some written evidence of this. So with regard to the Vomo Street property I accept the plaintiff's evidence as to how and when it was acquired rather than the defendant's version of events.

According to the plaintiff after a brief separation and reconciliation in 1973 the defendant took her to see a piece of land and said they would build their house there - their first house. That was before it was bought from Puni Gounder for $3000. She said it was agreed then that it would be in both their names. She contributed $600-700 cash towards the purchase price and it was agreed that the defendant would use his savings also towards the purchase, and she would use the money she was then earning towards keeping the house going. However, in the end the property was put in the name of the defendant only.

Towards the end of 1974 building started and was completed in 4-5 months, using direct labour, and they moved into the house in 1975. Two of the children were born in the house. So far as the Vomo Street property is concerned there is no question that it was acquired as a joint property and that the parties had or have an equal interest in it.

In 1981 the defendant sold the Vomo Street property for $41,000. Of this sum $10,000 had to be repaid to the bank leaving him in possession of a sum of $31,000, half of which must be considered to have been on trust for the plaintiff.

The second property was acquired by the defendant in 1977, that is the property at Korotogo which he bought from Latchmi Chettiar for $20,000. The plaintiff, whose evidence I accept, said they discussed the purchase of this property which was to be rented out. The plaintiff says she contributed a total of $300-400 towards the initial deposit for this purchase, the rest of the, money being obtained on loan by the defendant. She says she also contributed $500-700 worth of furniture to it. Meanwhile the plaintiff continued with her contributions to the household expenses leaving the defendant free to make his various land deals on their behalf.

The property was sold by the defendant in 1982 for $27,000 leaving him, after repayment of loans with a profit of $7,000. In the meantime it had been let, though the plaintiff saw nothing of the rentals. They were all collected by the defendant. He says he spent money on the property (he first of all said he spent $3000 on it, but later in cross-examination reduced the figure to $2000) and he even said he had lost some money on it, but he was not able in any way to substantiate what he said. Giving him the benefit of every doubt and allowing a possible expenditure of about $1,500 by the defendant on the property that would still leave a profit to him of $5,500 plus any rentals received half of which he must be considered to have held in trust for the plaintiff. For this property, I consider that a figure of $3000 held by him on trust for the plaintiff is of unreasonable.

In 1977, the defendant also bought another property in Korotogo from Maan Singh. This cost a total of $35,000. Half of the land he sold for $17,000 and the remaining ¼ acre, which had a house on it, he retained. This was rented out from 1979 - 1983 for $150 per month, and then from 1986 for $200 per month. The house itself is said to be worth $12,000, and in fact the defendant himself says that the house and land he retained is now worth $30,000 - $35,000 on which he says he still owes $18,000. This shows an appreciation of $12,000 - $17,000 plus rent received by the defendant worth at least $9,000.

The plaintiff says that the purchase was discussed between the two of them and the defendant's mother, and she believes the mother contributed $5,000 - 6,000 of the purchase price, part by the defendant, the rest presumably being by way of loan from the bank.

The defendant now says his father and mother and brother contributed to the purchase and he now says it was to be in trust for himself and his brother and sisters. But there is only the defendant's word for all of this, there is no trust deed, he has nothing to show where any of the money came from. It is extraordinary considering all the transactions the defendant involved himself in, that he has not been able to support anything he has said about money lent or borrowed with satisfactory documentary evidence. What evidence he has produced carne only at the last minute when it must have been obvious that his word and his vague recollections were not going to be accepted. Only whilst he was giving evidence did his assertion come in that he owned the property jointly with his mother and that he was holding it in trust for his brother and sisters. The trouble is that it is just not possible to give any credence to what the defendant has said unless it has been supported in some way by independent evidence.

I believe and accept that the property was bought as a joint property for the plaintiff and defendant and his mother (which is what the plaintiff said) the plaintiff sharing equally with the defendant and as near as I can assess it, taking into account what was paid, what is still owed, the rent that the defendant received and what the property is worth today, that the plaintiff's interest in the Maan Singh property is one-quarter of $21,000, that is $5,250.

The last property is the Morris Hedstrom property. The land was bought in 1977 for $8,600. The plaintiff says that she contributed $700 from her provident fund moneys towards the deposit and the rest being raised by the defendant or by mortgages and by loan from the bank. She says construction of the house on the plot started in 1980 just as the marriage started to fall apart. She says she contributed small amounts towards the purchase of building materials from time to time. According to her, the house on the land was almost half completed when the marriage broke up. The house was eventually completed and the defendant now lives in it with his present wife and children. He himself values the property at $80,000, although he also says that the land cost him $8,600 and the building cost him $78,000, making a total of $86,600 of which he still owes $15,000. That is clearly untrue. It is a substantial house on freehold land, and it is almost unheard of for the property to be worth less than was actually spent on building it and buying the land. And just to show how unreliable the defendant's figures are, earlier when giving evidence he said that the cost of building the house plus the cost of the land was $60,000. And before that he said it cost him $60,000 to build the house and that he still owed $20,000 on it.

Obviously, the Court will have to make such estimates as it can on the limited evidence available to it. The land cost $8,600 and if the building cost $78,000 to build as the defendant said, it must be worth at least $90,000, and if $15,000 is still owing on it then the value will be reduced to $75,000.

What the defendant has clearly been doing is using the proceeds from one property deal to finance the next deal (not to mention his dealings in cars and other enterprises) and for this purpose he has utilised the plaintiff's shares in the properties without accounting to her in any way. So apart from the plaintiff's third share in the Korotogo property which the defendant still owns, she must be deemed to have a half share in the MH property.

In monetary terms therefore the plaintiff's interest in the two properties must be one quarter of the $21,000 for the Korotogo property or $5,250, and half of $75,000, the current value of the MH property, or $37,500, the total being $42,750, and in the very least the defendant must, be considered to be holding the properties in trust for the plaintiff to the extent of $42,500. This will be in effect the judgment of the Court. The plaintiff had asked for an order of account, but I can see no merit in this, even if it could now be complied with. She also asked for an order of sale of the remaining properties, presumably so that she could be paid her share of the proceeds. But this should not be necessary, given some accommodation between the parties. If the defendant could pay that sum to the plaintiff so much the better, but if not then it is possible that one or other of the properties could be transferred to the plaintiff on trust for herself and the child of the marriage now living with her, accompanied by an appropriate capital adjustment to keep her interest to the level of $42,500. I would suggest that the parties come up with a proposal within the next 14 days as to how this is to be done, (for instance the plaintiff may be content with the transfer of the Korotogo property to her, together with an appropriate capital sum) failing which there will be an order for sale and the payment of $42, 500 from the proceeds to the plaintiff. The plaintiff is to have the cost of this action, to be taxed if not agreed.

G.O.L. Dyke
Judge

21 August 1987
Lautoka