Yapao v Windi [2008] PGDC 169; DC5021 (10 July 2008)

DC5021
PAPUA NEW GUINEA

[IN THE DISTRICT COURT OF JUSTICE]

GRADE V CIVIL JURISDICTION

DC NO 672 OF 2008

FRANK D. YAPAO
- Complainant -

PAUL WINDI
- Defendant -

Port Moresby: Pupaka, PM

2008: 2^nd July

Eviction proceedings – Summary Ejectment Act – Complainant has apparent title – Eviction order otherwise permissible and maybe issued.

Purchaser wants vacant possession – Proceedings defended on equitable grounds – Defendant stands by prior partly performed contract of sale – Two National Court cases – Eviction orders will prejudice an arguable case for specific performance in one case and complainant’s title disputed for irregularities in other – Eviction orders will prejudice both cases – Fairness and equity considerations – Proper to adjourn this case to give a fair chance to the defendant to prosecute his National Court cases – Costs.

The Complainant in person
Mr. Waira for the Defendant

10^th July 2008

PUPAKA: This has been a vigorously contested eviction case. For evidence the parties filed affidavits and relied on them. They also filed written submissions. I have perused them carefully and the following is the Court’s considered judgment in the matter.

The background facts

The complainant sought eviction orders to eject the defendant from the premises described as Section 506 Allotment 14 & 15 Hohola [Rainbow Estate], National Capital District (the property). Whilst the complainant has had title over the premises only since 3^rd April 2008, the defendant seems to have continuously occupied it from 2003.

The complainant executed a contract to purchase the property on 10^th March 2008. He had the title by 3^rd April and he commenced this case on 22^nd April 2008. It took just over a month from contract to eviction proceedings. This could yet go down as a record of sorts for lighting fast conveyancing! Nevertheless, by contrast, the tale of the defendant’s residence in the place is an uncomplicated one.

The property was sold to the defendant in 2003 for K160, 000.00 by the joint owners, a couple. About of K127, 683.70 was paid up. The balance of K32, 316.30 was to be paid on completion. The exact amount of payment made and sum outstanding are disputed, but for the time being, these details are not really important. Formal completion did not happen. The reasons why there was no finality are also disputed but it is not necessary to recount them here for the time being. Suffice to say that the defendant moved in and occupied the property for five years. The defendant’s occupation was agreed upon by the vendors at the time.
Then in 2007 the vendors, Gary and Kari Uprichard (the Uprichards), demanded vacant possession of the property. That prompted the defendant to commence proceedings in the National Court to seek specific performance, alleging that completion had been delayed and frustrated by the Uprichards. The case is W.S. 1336 of 2007. It was commenced on 21^st November 2007 and is pending. A motion, filed to obtain restraining orders, preventing the Uprichards from dealing with the property, while the claim for specific performance was still pending, was never moved. For one reason or other the hearing of the motion has been delayed and frustrated.

Briefly though, evidence shows the motion seeking restraining orders was adjourned after an undertaking was given by the defendants (Uprichards) to the presiding judge, whereby the defendants undertook to not sell or otherwise deal with the property at least until the next date set for hearing of the motion. There is uncertainty as to whether that undertaking was to last beyond the motion’s return date. In any event, up to now, the notice of motion is presumably pending still, but as things now stand, subsequent turn of events have rendered the need to move for restraining orders obsolete.

Earlier on 9^th November 2007, fearing that the Uprichards might sell the property before he started court proceedings, the defendant lodged a caveat preventing all dealings on the property.

Despite all of that the vendors contracted to sell the property to this complainant on 10^th March 2008. Within weeks, on 3^rd April 2008, title was transferred and registered in the complainant’s name.

Numerous correspondences have been exchanged between all the parties involved. Demands for voluntary surrender of possession have been rebuffed and rejected. Finally the complainant issued this proceeding to have the defendant evicted from the premises. For his part the defendant not only opposes this proceeding but he has also commenced another proceeding in the National Court, against the complainant and the Uprichards and others to inter alia, nullify the sale and transfer of title to the complainant.

Findings generally

The details of why completion did not occur between this defendant and the Uprichards are either not available or unclear or disputed. However it is a fact that completion was delayed for a long time. Then when a fresh contract of sale was executed between the Uprichards and the complainant last year, completion of the first sale between this defendant and the Uprichards became impossible.

The property was sold to the complainant at a sale price of K230, 000.00 for unencumbered title and vacant possession. The complainant now seems to possess clear title.
Title has changed hands so presumably completion has occurred. I say ‘presumably’ because there is a contention that the purchase money has not yet been remitted by the complainant to the Uprichards. Even so, unfortunately for the complainant, the Uprichards did not give him vacant possession as per the contract of sale. This fact stands on record as a pivotal breach of the contract between the complainant and the Uprichards. For some reason the complainant does not want to assert his rights under the contract, which, considering the circumstances, would have been a relatively easier task than prosecuting a eviction proceeding that is fiercely contested by a defendant who obviously is no easy pushover.

If it were not for the arguments of equitable rights asserted by the defendant, the complainant would be entitled to the eviction orders he seeks on the strength of clear title. By law unencumbered title bestows upon the holder superior rights. The right to assert eviction is found in Section 6 of the Summary Ejectment Act which reads:

“6. Recovery of premises held without right, etc

(1) Where a person without right, title or licence is in possession of premises, the owner may make a complaint to a magistrate of a District Court to recover possession of the premises, and the magistrate may issue a summons in the prescribed form to the person in illegal occupation.
(2) Where the person summoned under Subsection (1) –

(a) does not appear before the District Court at the time named in the summons; or

(b) appears and does not show reasonable cause why possession of the premises should not be given,

the Court may, on proof of the matter of the complaint, issue a warrant directed to a member of the Police Force requiring him, on or before a day specified in the warrant –

(c) to enter, by force and with assistants if necessary, into the premises; and
(d) to give possession of the premises to the complainant.”

Subsection (2) (b) permits persons such as this defendant to “show reasonable cause why possession of the premises should not be given...” The defendant, in objecting to the grant of eviction orders, now shows cause why he must not be evicted at this time.

The defendant’s first ‘cause’ is his case in W.S 1336 of 2007 and its implications. That case was commenced against the Uprichards alone and it seeks principally to compel the Uprichards to do whatever they need to do to bring about completion. In essence the defendant seeks relief for specific performance in that case.

Therefore, in the circumstances, if the complainant is granted the eviction orders he now seeks, the defendant’s chances of obtaining relief of specific performance in relation to the same property, is either eliminated or rendered obsolete. It is because, as a matter of law, eviction orders will enable the complainant to obtain exclusive vacant possession. Among other implications, it may also mean that the complainant would have the complete freedom to sell the property if he wanted to, even further prejudicing the defendant.
The case in W.S 1336 of 2007 was commenced before the property was sold to this complainant. The Uprichards’ conduct, in as much as they deliberately sold the property, well knowing that the sale would frustrate the proceedings in W.S 1336 of 2007, was a callous and wanton act. Needless to say it amounts to contemptuous disregard for court proceedings, more so after they had given an undertaking, to the Deputy Chief Justice no less, to not engage in conduct or dealings that might prejudice the defendant’s rights.

The complainant could say that he was not aware of the pending case in W.S 1336 of 2007. On the other hand the Uprichards have no such excuse. In my view the Uprichards are guilty of non discloser of material facts. Again the complainant would, if he wanted, assert his rights under the contract of sale on the bases of that cardinal breach.

However, if the complainant became aware of W.S 1336 of 2007 prior to completion, but yet elected to finalize purchase anyway, his conduct amounts to reckless assumption of risks. It would also have been presumptuous folly on the complainant’s part to think that the Uprichards were entitled to resell the property. Being a reasonable person, but more so as a lawyer, the complainant would have known that the court case, whilst it was still pending, is a ‘caveat’ against all dealings in the property by the vendors. Needless to say that the knowledge of the court case is adequate warning, not only to the complainant but also to anyone else interested in the property.
The second ‘cause’ is the defendant’s latest case in W.S 665 of 2008 and its implications. This time the complainant is a party, as well the Uprichards and others. The case seeks to set aside the title now vested in the complainant. This second case is meant to complement the first one and, rightly or wrongly, the validity of the complainant’s claim to the property is now being challenged. Whether the challenge will be successful or not is not for this instant Court to ponder. It will suffice for the moment to say there is a possibility that the contract of sale between the complainant and the Uprichards maybe voided.

It is unclear why the complainant did not at least delay completion when he became aware of the caveat placed by the defendant, particularly when he also knew that the defendant was in occupation of the property. Being a lawyer the complainant would have done all mandatory checks and completed proper due diligence. So he must have become aware of the caveat and the defendant’s claims in the property, well before completion. Also the complainant contracted to take vacant possession, but knowing what he by then must have known about the property’s status, he would have appreciated that obtaining immediate or vacant possession was not going to be easy.

Moreover if the defendant vacates the property now, his chances of regaining possession, after he is successful in the National Court in relation to any one or both of his cases, is not assured. The evidence indicates that he would struggle to get back possession. I shall expound on this by stating an example here: Somehow title to the property was transferred and the complainant was registered as the unencumbered title holder despite a caveat lodged by the defendant to prevent the very thing from happening! Just why the caveat did not do its job is any one’s guess but it does demonstrate, albeit sadly, that the regularity of the systems or check and balance mechanisms cannot be taken for granted these days.

In the circumstance the only guarantee of sorts the defendant has, to prevent another sale which may yet again prejudice the interests he now seeks to protect, is to retain physical possession of the property. No one can stop the complainant from selling the property once he has vacant possession, particularly now that he has clear title.

On the other hand the complainant has the title deed so he is assured of securing possession later, once the defendant’s National Court cases have run their natural courses. The defendant cannot stop the complainant then, even if he tried. In the meantime the complainant should make sure that those cases are resolved quickly. He could ‘prod’ the defendant to cause expeditious hearings.

Had the National Court not presumed upon the integrity of the Uprichards and granted the restraining orders, instead of needlessly adjourning the motion, the subsequent sale would not have taken place and this instant proceeding would not have happened.
This Court can prevent a similar mistake. By an appropriate decision in this instant matter, this Court can allow the defendant to fully exhaust his chances and options. The defendant’s opportunities are capable of being lost, in one way or other. In the circumstances, granting the complainant eviction orders will leave the defendant in a near hopeless position. Whereas on the other hand the complainant’s right to vacant possession would be delayed only temporarily.

The Uprichards are said to be permanently domicile outside PNG. They sold the property to the complainant by proxy. Therefore it is inappropriate to reason that the defendant has a better relief in damages, as I normally would do in other appropriate cases. Relief in damages may not be viable here. Besides that the defendant’s best chances seem to lay in asserting specific performance.

Not granting eviction orders now cannot prejudice the complainant, at least not as much as the defendant would be if the latter was evicted from the place. The complainant would easily obtain possession later, after the defendant has exhausted himself. In any case the inconveniences the complainant may face, as a result of not obtaining vacant possession sooner, are largely the result of his own presumptuous assumption of risk by buying a property, the title to which was not free of encumbrances. As things now stand, it will not be overly prejudicial to the complainant, any more than to the extent he has already allowed himself to be by taking reckless risks.
The complainant can demand refund from the Uprichards. If funds have not been remitted yet as alleged, it is better he retains them awhile. He should also sue the Uprichards for their failure to deliver vacant possession in accordance with the contract of sale or for non discloser in relation to the status of the property or for both.

Conclusion

While the complainant is within his right to seek eviction orders, I am satisfied that the defendant has shown sufficient and reasonable cause for the orders to be either delayed or not issued at this time. For the reasons given above it is neither proper or fair nor convenient to force the defendant out of the property at this time.

It is not appropriate to dismiss this case. The complainant otherwise has a right to demand vacant possession. In all the circumstances of the case a long adjournment is the fairest outcome. The complainant may activate and progress this matter if the defendant does not prosecute his cases in the National Court within a reasonable time.

It is possible for the National Court to inform the defendant, Paul Windi, that his rights are in damages only and not necessarily in the property. In that case he may yet be ordered to render vacant possession to the complainant, Frank Yapao. Then again Mr. Windi maybe granted the orders he hopes for. It seems he has an arguable case in both proceedings, which is sufficient for the moment. All that matters now, regardless of how things may fan out in the end, is that the Mr. Windi deserves an opportunity to argue the issues he has raised in the court above – while he still occupies the property. To not afford him that opportunity would be to deny him justice.

It is entirely inappropriate to guess at or pin down the time it may take to finalize the two National Court cases so it is better to adjourn this instant case sine die. The parties, particularly the complainant, would cause this matter to be re-listed later, when he needs to be.

For all the foregoing I order that this proceeding is adjourned sine die pending the determination, one way or the other, of the National Court proceedings in W.S No. 1336 of 2007 and W.S. No. 665 of 2008. Costs of this instant proceeding shall be costs in the cause for the time being.

_______________________________________________

The Complainant in person
Cappollo Lawyers for the Defendant