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Supreme Court of Fiji |
IN THE SUPREME COURT OF FIJI
AT SUVA
Civil Petition No: CBV0006/2011
Civil Appeal No. 0086 of 2008
BETWEEN:
1. ISHWAR NAND
2. ISHWAR NAND
Petitioners
AND:
1. RAMESH KUMAR& SUNIL KUMAR
1st Respondents
2. HARI NAND
2nd Respondent
Coram: Hon. Justice Sathyaa Hettige, Judge of the Supreme Court
Hon. Justice, Suresh Chandra, Judge of the Supreme Court
Hon. Justice Sriskandarajah Sundaram, Judge of the Supreme Court
Counsel: Chandra S for Petitioner.
Mishra N for 1st Respondent.
Date of Hearing: 8th August 2012
Date of Judgment: 16th August 2012
JUDGMENT
Trial and the Judgment of the High Court
(i) A declaration in terms of the first remedy above.
(ii) An order that the defendants personally shall pay to the two plaintiffs forthwith, one third to each ,from the cane proceeds of the estate farm for the years 1993 to 2008 (October) inclusive, which proceeds were $87,357.67. One third is $ 29,119.22.
(iii) An order removing the present executors and trustees of the estate of Ram Asre, and appointing in their place the plaintiffs herein.
(iv) An order that the Registrar of Titles shall forthwith remove from the Certificate of Title to Lease No.26833 the caveat of Anil Kumar, No.301910 and take all steps necessary to enable registration of a transfer of ownership to the three residuary beneficiaries of the estate of Ram Asre.
(v) An order that any party may apply on notice for any further order either consequential or for clarification to enable these orders to have their full effect.
“I totally agree with the trial Judge’s findings in respect of the “settlements” and hold as he did that the “settlements” did not bind the respondents and simply were ineffective attempts to alter the transmission of Ram Asre’s estate contrary to his intentions. In my view this appeal should be dismissed and the appellants should pay the Respondents cost of the appeal assessed at $4000.
Special leave to appeal
8. Petition for Special Leave to Appeal against the judgment of the Court of Appeal was filed in the Supreme Court on 18 April 2011 along with the Grounds of Appeal. The Petitioner has summarised the grounds of appeal in his written submission in seeking Special Leave to Appeal. The Petitioner submitted that present case involves far reaching questions of law relating to:-
9. With regard to the questions of law raised in (a), (b) and (d) above the Petitioner submitted that in the High Court the First Respondents basic claim against the Petitioner, Anil Kumar and Second Respondent is for the Estate of the Testator the late Mr. Ram Asre as Executors and Trustees of the said estate and there is no claim of damages against the Petitioner. The Petitioner cited the learned High Court judges’ observation in his Judgment at page 30 of the record where the learned judge observed;”Mr Sahu Khan’s first submission is that while plaintiff’s counsel asked at the hearing for damages, he pleaded no claim for damages and none can be allowed. I agree with and accept that submission”.
10. The Petitioner contended that after the learned Judge arrived at the above finding, he goes against his own ruling and awards damages against the First Petitioner personally in the final order, where the court ordered:
“(ii) An order that the Defendants personally shall pay to the two Plaintiffs forthwith, one third to each, from the cane proceeds of the estate farm for the years 1993 to 2008 (October) inclusive, which proceeds were $87,357.67. One third is $29,119.22.
11. The Petitioner’s challenge to the aforesaid order is twofold. One is that there is no claim for special or general damages and the other is that there cannot be an order to pay the damages personally as the Petitioners were made parties to the said High Court case in their capacity as Executors and/or Trustees.
12. I will now deal with the first challenge. The Petitioner contended that the statement of claim of the Plaintiffs does not contain any averment for loss and damages. It is trite law, that any claim for special damage must be pleaded. This position is well stated in Halsbury’s Laws of England (4th Edition) Reissue Vol 36(1) at page 21 paragraph 28 where it states:- “Special Damages comprise all past pecuniary loss which is calculated at the date of the trial.......Special Damages must be pleaded, if they are not, no evidence may be given of them at the Trial”.
13. Special damage in the sense of a monetary loss which the plaintiff has sustained up to the date of trial must be pleaded and particularised, otherwise it cannot be recovered; Ilkiw v Samuels [1963] 2 All E.R 879 per Diplock L.J. A mere statement or prayer that a plaintiff claims “damages” will not support a claim for loss of profits for breach of contract: Perestrello E Companhia Limitada v United Paint Co.Ltd; [1969] 3 All E.R.479.
14. The reply to the above submissions of the Petitioner could be found in the judgment of the Court of Appeal at paragraph 30 and 31.
30. Dealing with the question of damages first, in my view, in awarding one-third to each of the Plaintiffs/Respondents from the cane proceeds of the estate farm of Ram Asre for the years 1993 to 2008 in the sum of $29,119.22 was not damages but clearly the product of accounting as had been sought by the plaintiffs. Had it been damages, one would have expected a proper assessment of damages of value. No such step was taken by the trial judge but he made specific reference to the fact that accounting had been sought by the plaintiffs and in response to that he had come to award the sum I have already mentioned to each of the plaintiffs. Therefore the appellants were not denied an opportunity to be heard.
31. I reject the Respondents submission that the trial judge had awarded damages. There is no basis upon which a conclusion could be reached that damages had been awarded because a monetary sum had been awarded in the absence of proper assessment. The assessment which His lordship made was a process of accounting which eventually lead to a final figure which he awarded.
15. In fact the First Respondents had in their Amended Statement of Claim specifically asked for payment of cane proceeds held by the Petitioner and the Second Respondent to court and the same be distributed to them.
16. The First Respondents (two plaintiffs) are residuary beneficiaries in their father’s estate; the three trustees are the defendants in this action. One trustee died he was Anil Kumar. One of the two surviving trustees, i.e. Hari Nand, is also the third residuary beneficiary. According to the Will the residual estate settled on the three beneficiaries upon the death of their mother on the 25th June 1988. The father directed the trustees to give the beneficiaries the whole of his 22 acre farm. The First Respondents (Plaintiffs) claim was for accounting for the farm income from the time of their mother’s death in July 1988 until the action was concluded.
17. The Petitioner at no stage produced accounts or books of record at the trial. The First Respondents are entitled to know where their money from the Estate farm had gone. The First Respondents are entitled to two thirds of the same after the death of Mrs Ram Asre who had a life interest. If the Petitioner who handled the accounts of the estate had maintained accounts, any misconception as to who received the moneys would have been easily resolved.
18. According to the Will the First Respondents are entitled to two thirds of the estate lease and two thirds of the net income from 1988, up to the date of trial they had not received a single cent despite their clear entitlement. The First Respondents (Plaintiffs) did not ask for damages for breach of trust. The First Respondents were awarded the said sum of money as the court had clear evidence that the Petitioner as trustee had received the said sum of money from Fiji Sugar Corporation Limited as Estate income from cane production. According to the Judgment the sum of money to be paid to the First Respondents is their income entitlement and not damages.
19. The second challenge to the aforesaid order is that the court has no power to make an order directing the First Petitioner personally to pay the First Respondents, one third to each, from the cane proceeds of the estate farm for the years 1993 to 2008. The Petitioner submitted that it could be seen from the Writ of Summons and the Amended statement of claim that the First Petitioner was sued only as the Executor and Trustee of the estate of Ram Arse and not in his personal capacity that is in his propria personam.
20. The Petitioner contended that the above position is well stated in Supreme Court Practice 1967 Volume1 where it stated at paragraph 15/1/3:-
“Party in more than one capacity”
The name of a person who is a party in more than one capacity, e.g, in a personal and representative capacity must be inserted ---A note will be added that he sues or is sued? both personally and as trustee of the will of – or as the case may be per Sargant, L.J, in Hardie and Lane, Ltd v Chiltern, [1982] 1 K.B. p 669.
21. The Petitioner’s above submission could be accepted if the Petitioner has truly acted as Executor or Trustee in dealing
with the trust property. The Petitioner as a trustee has a duty to maintain a separate trust account in relation to the farm but
he has failed to do so. Halsbury’s Laws of England Fourth Edition, Volume 48 paragraph 832 at page 452 where it states:
832. Accounts; A Trustee must keep an accurate account of the trust property, and must be always ready to render it when required.
22. That a trustee will be held personally liable if he does not ensure production of accounts even if he delegated that duty: Carruthers v Carruthers [1896] UKLawRpAC 39; [1896] AC 659 at page 665.
23. In Carruthers v Carruthers (supra) the House of Lords stated:
“It is admitted that, if that view be correct, the immunity clause does not protect the trustees. Then what is the extent of their liability? They are liable, as it seems to me, for all the results naturally flowing from the breach of duty on their part; and I think where this culpa lata is shown and it might be reasonably concluded that the trust would not have suffered as it did if the duty had been observed”
.......
“I think, therefore that the proper course in the present case will be to reverse the interlocutors appealed from, and to declare that the respondents are bound to make good to the trust of the estate the sum of 1041.2s.7d, with interest from January 31, 1891. As regards costs, I think the appellant must receive the costs in the Inner House and also costs in this House”
24. There are no damages awarded by the Trial Judge and the sum awarded to the First Respondents is the sum received by the Petitioner as proceeds of the trust property. The Petitioner is personally liable to make good to the trust of the estate the sum received by him as proceeds of the estate. For these reasons, the first, second and fourth questions of law raised by the Petitioner have no merit.
25. The only other question raised by the Petitioner in this leave to appeal application is that:
Declaring the proper and valid terms of settlement dated 22nd March 1992 invalid by taking into account irrelevant considerations.
26. Ram Asre, died on 28th September 1978, On 17 May 1979 probate was granted to Anil Kumar, Ishwar Nand and Hari Nand. According to the Will, life interest was granted to their Mother in the estate with a gift to Ramesh Kumar and Sunil Kumar (First Respondents) Hari Nand (Second Respondent), in equal shares. The beneficiaries and trustees are children of Ram Asre. Mother died on 25th June 1988, with the death of the mother the estate vested in the residual beneficiaries.
27. It is in evidence that shortly after the funeral and 13 days of mourning the children of Ram Asre arranged a meeting and rearranged their father’s bequest on the 10th July 1988. The First Respondents deny there was any such meeting. There is evidence to show that the First Respondents after their mother’s death requested the trustees many times for a copy of the father’s will. As they were not successful the First Respondents and the second Respondent through a lawyer obtained from the court a copy of the probate with the Will annexed.
28. The Respondents having read the Will instructed the lawyer to file proceedings in the High Court at Lautoka (proceeding No 105/1991). The Originating Summons sought removal of Ishwar Nand and Anil Kumar with Hari Nand to remain as sole trustee. It also sought an order for distribution according to the Will, i.e. to the Respondents.
29 The Proceedings were commenced by the Respondents. However, Hari Nand the Second Respondent was given specific authority by the other two beneficiaries the First Respondents by Powers of Attorney to conduct the proceedings up to the point of removal of the other two trustees and distribution of the estate. The Powers of Attorney were in general form and the powers given were very wide.
30. The case proceeded and hearing was fixed for 19 March 1992. Counsel for the Plaintiffs told court that the matter had been settled. The terms had not been typed. Formal terms were to be filed when typed. The Judge adjourned the case until 27th March for formal settlement. On 27 March 1992 Counsel appeared and the judge noted that the matter was settled and adjourned the case sine die.
31. The settlement was as follows:
Anil Kumar to pay Ramesh Kumar cash money of $7,000.00 (seven thousand dollars) and the share of Ramesh Kumar in the Estate of Ram Asre to be taken by Anil Kumar and in this share will also be included the house that is in the estate land and which estate land Native Lease number is 26833 and the farm number is 3377 (Yalandro Sector).
That Sunil Kumar’s share was agreed to be $5,000.00 (five thousand dollars) and his share to be paid by Hari Nand and Hari Nand to pay Sunil Kumar $5,000.00 (five thousand dollars) and take over his one third share in the estate.
That the sugar cane contract number 3377 to be in the name of Hari Nand but proper agreement to be made in lawyers office that Anil Kumar can send sugar cane in the same contract.
That Hari Nand, Sunil Kumar and Ramesh Kumar to withdraw the case against Anil Kumar and Ishwar Nand in the High Court and which was action No105 of 1991 district registry.
That Hari Nand will sign this settlement for himself and also on behalf of Ramesh Kumar and Sunil Kumar as he has full power under Power of Attorney number 20201 from Ramesh Kumar and Power of Attorney number 20159 from Sunil Kumar.
32. The settlement reached was never filed in court. The proceedings in court were by agreement abandoned. According to the evidence the settlement was signed on 22 March 1992 at the family House on the farm. The settlement was signed by Anil Kumar, Ishwar Nand the trustees against whom the legal proceedings were initiated and Hari Nand who was holding the Powers of Attorney of his brothers Ramesh Kumar and Sunil Kumar.
33. The evidence of Ramesh Kumar and Sunil Kumar in this case was that they were not parties to any purported settlement on 10th July 1988, nor to the proceedings recorded over the signature of Hari Nand 22nd and 24th March 1992. The learned High Court Judge observed that evidence seems to be consistent with the evidence about their actions.
34. They said that when they came to know the settlement, they cancelled the powers of attorney given to Hari Nand. They retained a separate lawyer to appear in High Court No 105/1991. Within three months, about 10 June 1992 proceedings in the Lautoka High Court No HBC 179 of 1992/L ( the present Action) was instituted on behalf of Ramesh Kumar and Sunil Kumar against Hari Nand and other two trustees.
35. The learned High Court Judge in his judgment said that there has been throughout only one issue, were the Plaintiffs parties to the two alleged settlement in 1998 and 1992? and said:
“that issue on the balance of probabilities resolves itself easily. For a start, they have never been paid. They have never been offered money. They stand at present in a state of detriment, i.e. without their bequest and with nothing to show for it. Neither have the Defendants anything to show for their claim. There is no renunciation by these two beneficiaries, no documents of any sought have been prepared let alone filed by the trustees to give effect to any variation of their father’s Will. All they have to show are certain self serving documents prepared by themselves in which they say these two beneficiaries agreed to forego their bequest. Neither beneficiary has signed. Hari Nand has signed, using the powers of attorney to gain a benefit for himself. On this evidence one can scarcely make any finding in favour of the trustees. The dispute resolves in favour of the two plaintiffs. After observing them and observing Ishwar Nand as they give their evidence and after considering all the evidence I have no doubt at all, from the demeanour of the witnesses and from the whole history of the events, that the trustees arranged everything. It is my finding that the two plaintiffs have not participated in any purported arrangement whereby they are not to receive their residual bequest in their father’s Will”
36. In the Court of Appeal Judgment, His Lordship has quoted the same passage of the Judgment of the High Court and said:
“The trial judge had the opportunity to assess the witnesses as they gave their evidence. He also had the opportunity to assess the relevant documents that were tainted in evidence. Nothing has been shown to this court to enable it to overturn the findings of the trial judge. The applicable principle in the circumstances were the trial judge’s findings are under attack were clearly set out in Mahadeo Singh v Chandra Singh (1970) FLR 155 where the Court of Appeal where Gould VP, with whom Marsack JA and Tompkins JA agreed, said at p.159:
“Much has been written as to the position of an Appeal Court which is invited to reverse on a question of fact the judgment of the judge sitting without a jury, who had the advantage of seeing and hearing witnesses. Where he has based his opinion in whole or part on their demeanor it is only in the rarest of cases the appeal court will do so, Yuill v Yuill [1945] p15”
This is not such a rare case. It follows that I totally agree with the trial judge’s findings in respect of the “settlements” and I hold as he did that the “settlements” did not bind the respondents and simply were ineffective attempts to alter the transmission of Ram Asre’s estate contrary to his intentions.”
37. The Petitioner submitted that it is true that the Plaintiffs (the first Respondents) have not participated in any settlement. But the 2nd Respondent Hari Nand signed the said settlement on behalf of himself and on behalf of the Plaintiffs (the first Respondents) as he held their Power of Attorney and therefore the plaintiffs (the first Respondents) were bound by the said settlement. If the 2nd Respondent did not comply with any verbal internal instructions, that is a matter between the Donors and the Donee. That has nothing to do with Third Parties such as the Petitioner herein. Once the lawful Attorney at the time executes any legal document and he has no notice of revocation at the time of execution of the Power of Attorney, the document is deemed to be properly signed.
38. The above submission invites this court to examine the Powers of Attorney given by Ramesh Kumar and Sunil Kumar to Hari Nand. At the time the beneficiaries of the Will of Ram Asri ie. Ramesh Kumar and Sunil Kumar and Hari Nand found that the trustees have failed to distribute according to the Will, instructed Mr A.K.Narayan a Lawyer in Ba to file proceedings in the High Court at Loutoka and sought removal of Ishwar Nand and Anil Kumar, with Hari Nand to remain as sole trustee and also the distribution according to the Will (High Court Case No 105/1991). Ramesh Kumar and Sunil Kumar had given specific authority to Hari Nand by way of Powers of Attorney to conduct the proceedings for them as well, most probably on legal advice as they were living in Australia.
39. Even though the purpose of the Power of Attorney was to conduct the legal proceedings it was couched in a general form. The said power of attorney contained provisions such as:
Clause 7 states:
To manage, let sell mortgage charge exchange or absolutely dispose of and convey assign transfer or surrender the same or any part thereof or any interest therein.
Clause 11 states:
Generally to do execute and perform all and every other act matter and thing whatsoever in any wise necessary or expedient to be done in my concern and business of every or any nature or kind so ever as fully and effectually as if I were personally present to do the same.
40. The Petitioner contended that these provisions of the Powers of Attorney gave authority to Hari Nand to execute the said settlement arrived at on 22nd March 1992. If the Second Respondent did not comply with any verbal internal instruction that is a matter between the Donors and the Donee and it has nothing to do with Third Parties.
41. The reply to the above submission could be found in the judgment of the learned High Court Judge paragraph 44:
“The second “settlement” document suffers from the same defects. Even greater doubts are cast on it by the actions of Hari Nand who purported to alter the terms of the trusts in the Will to his own benefit. To do this he used his Powers of Attorney in a secretive way to effect an outcome of the High Court proceedings No.105/1991 which not only benefitted himself and deprived his two Co-beneficiaries of their benefits; he acted contrary to their instructions in his purported exercise of the Powers of Attorney given to him. The outcome which he purportedly settle by his signature actually was the opposite of the stated object of those proceedings and the verbally stated object of his Powers of Attorney. The evidence leave me in no doubt that, whether or not their solicitor advised signing a full Power of Attorney, the two plaintiffs did so in order to give their brother and fellow beneficiary authority to conduct and settle the action to remove the other two trustees HBC 105/1991. He deceived them. He used the powers for other purpose.”
The Learned High Court Judge further observed in paragraph 52 of his judgment:
“I shall mention only the submission in respect of the use of the Powers of Attorney. The submission is that “the courts have repeatedly held that anyone executing a legal document is bound by the same unless of course it was signed by fraud, misrepresentation or mistake”. That principle applies here. It is a powerful principle. On the facts, Hari Nand perpetrated either fraud or mistake, and his failure to disclose to Sunil Kumar before signing the “Settlement” on 22 March 1992 amounts to either fraud or misrepresentation.”
42. There is evidence to show that Hari Nand met Sunil Kumar on the day the purported settlement was signed. Hari Nand was well aware that Sunil Kumar was available for consultation and even to sign the settlement But Hari Nand without disclosing the settlement to Sunil Kumar signed the said settlement on behalf of Ramesh Kumar and Sunil Kumar on the strength of the Powers of Attorney given by them.
43. Halsbury Laws of England 4th Edition Volume 18 in paragraph 345 under the heading ’Bargains with Heirs’ where it is stated as follows:-
“The court will always relieve against fraud which infects unconscionable bargains made with heirs, reversioners or expectants on the security of their expectant or reversionary interests in property, and fraud is always presumed in such cases from circumstances of the parties contracting, namely weakness on the one side, and on the other, usury, extortion or advantage taken of that weakness. Fraud does not in these cases mean deceit; it means an unconscionable use of the powers arising out of the attendant circumstances and conditions, and where the relative position of the parties is such as prima facie to raise this presumption the transaction cannot stand unless the person claiming the benefit of it can prove it to be in fact fair, Just and reasonable.”
The presumption is that the said settlement of 22 March 1992 and 24th March 1992 are tainted with undue influence and fraud. The Petitioner has failed to rebut the presumption. In these circumstances the petitioner’s submission that irrelevant consideration had been taken into consideration in declaring the proper and valid terms of settlement dated 22nd March 1992, has no basis.
44. The Petitioner has sought special leave to appeal from this Court against the said judgment of the Court of Appeal on the grounds set out in the Grounds of Appeal filed in the Supreme Court on 18th April 20011, which is summarized in the Written submissions of the Petitioner as follows:
(a) As regards to claims against the Executors and Trustee and personal liabilities;
(b) The issue of damages/accounts personally to Executor and trustee when the Trustee’s Statement of Claim did not contain claim for damages/accounts to be provided personally;
(c ) Declaring the proper and valid terms of settlement dated 22nd March 1992 invalid by taking into account irrelevant consideration;
(d) Assuming the First Petitioner personally liable when he is not a beneficiary in the estate property of Ram Asre deceased.
45 It is incumbent on this Court in considering whether this is a fit case for the grant of special leave to bear in mind the several criteria set out in Section 7(3) of the Supreme Court Act No. 14 of 1998, read with Section 8 of the Administration of Justice Decree 2009, which provides that: In relation to a civil matter (including a matter involving a constitutional question), the Supreme Court must not grant special leave to appeal unless the case raises-
(a) a far reaching question of law;
(b) a matter of great general or public importance;
(c) a matter that is otherwise of substantial general interest to the administration of civil justice.
46. The Privy Council and the Courts in Fiji has constantly held in granting Special Leave to Appeal that the case had to be one of gravity involving matters of public interest, or some important question of law, or affecting property of considerable amount and where the case is otherwise of some public importance or of a very substantial character. See Daily Telegraph Newspaper Company –v- McLaughten [1904] UKLawRpAC 45; [1904] AC 776, Dr Ganesh Chand –v- Fiji Times Limited and Margaret Wise (unreported civil appeal CBV of 2009 delivered 8 April 2011). Having taken into consideration the submissions made by learned Counsel in this case, both written and oral, We are of the view that any or all of the grounds set out in paragraphs (a) to (d) of the Petition for Special Leave for Appeal, do not amount to far reaching questions of law which involve matters of great general and public importance.
Conclusion
47. For the foregoing reasons, we hold that the application for special leave to appeal has to be refused, as the Petitioner has failed to satisfy Court that the case raises any far reaching question of law, a matter of great general or public importance or a matter that is otherwise of substantial general interest to the administration of civil justice. The application for special leave to appeal is therefore refused, and the decision of the Court of Appeal dated 10th March 2011 is affirmed. In all the circumstances of this case, we do not make any order for costs.
---------------------------------------
Hon Justice Sathyaa Hettige
Judge of the Supreme Court
------------------------------------
Hon. Justice Suresh Chandra
Judge of the Supreme Court
-------------------------------------
Hon. Justice Sriskandarajah Sundaram
Judge of the Supreme Court
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