Hue v Bochman [2018] SBHC 7; HCSI-CC 60 of 2016 (31 January 2018)

This is a claim for possession of registered land in Honiara by the owner, John Hue. The property is registered lease parcels 191-049-12, 191-049-13, 191-049-14 and 191-049-15, (the “property”).

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The named defendants by Defence and Counter- Claim say the property was occupied by them pursuant to a consent given by the claimant on the 13 April 2015 with an “understanding that title to parcel 12 and 13 will be transferred to the 1^st and 2^nd defendant”. The defendants consequently claim right to remain on the land in accordance with the agreement. The defendants go on to plead they only developed their 2 plots of land to be transferred (by agreement) to them “after payment of the necessary fees and transfer procedures being properly executed.”

By counter-claim the defendants seek rectification of the land Register by registering their names on the title to the whole 4 lots, claiming the title had been obtained by fraud. As well, the defendants seek order permanently restraining the claimant from interfering with their occupation and possession of these two lots.
Particulars of the fraud alleges the claimant had received $ 40,000 from the defendants to facilitate the purchase of the blocks; had given consent to the defendant to develop pending transfer of lots 12 and 13 into the defendant name, yet fraudulently had registered all 4 blocks in the claimants name without the knowledge and consent of the defendants.

On the 5 October when this matter came for trial, both counsel read their respective statements filed in the proceedings without objection. These statements were included in the trial Book 2- Disputed Document. I shall refer to the particular papers.

The claimant by his original statement in support (filed 24 February 2016) whilst claiming right to possession as owner of the 4 properties, annexed two lease register copies for parcels no. 191-049-14 and 15 showing that he had taken ownership as lease from the Premier for a term of 50 years from the 1/1/14 at a yearly rental of $252.80 a year (for parcel 14) and $ 233.60(for parcel 15). Lease premiums were respectively $3,160 and $ 2,920. A second statement filed on the 9 September 2016 (filed after the amended defence and counter-claim of the 6 May 2016 and response dated 5 July 2016) recounted John Hue’s actions leading to the registration of the 4 properties in his name by transfer from the Premier of Guadalcanal Province. As well, he has addressed the defendant claim to the properties as follows:
“I wish to further response to the Amended Defence & Counter Claim by the First and Second Defendants filed on May 6, 2016 that the $40,000.00 was for the payment for Lots 12 and 13 they want from me. The $20,000.00 is for part payment of Lot 12 & 13 respectively totaling to $40,000.00. It is not for the registration of the properties to the First and Second Defendants. The Properties are owned by me. The $40,000.00 was paid after the Properties were registered to me. I refused to continue with sale of Lot 12 and 13 to the Defendants because they do not intend to comply with the Land and Titles Act provisions to purchase the whole price including its stamp duties. They have failed to comply with requirements for the sale for those two (2) blocks. See the value of Lot 12 & 13 in the Valuation Report Exhibit JH4.”

The valuation report referred to is by one Wendy K. Sade P.O.Box 134 Honiara. She has stated her qualifications and presumably standing to claim to be a valuer as, PNG, Unitech, 2009. Her disclaimer was,
“I also certify that the valuation report herein is prepared for the addressee only and for the purpose stated herein.
I will not be responsible for any second party nor will I be viable to any other purpose or for the content of this report by any second party.”

The purpose of the report was stated to be to assess the unimproved open market value of the underlined parcels for your personal information. The value was for the whole property, the 4 lots. The property has been described as,
“Neighbourhood analysis
The Doma neighbourhood is undeveloped mainly and is comprised of mostly untended cash crops such as cocoa and coconut. There are mostly grasslands and shrub tress located thereon. There is excellent accessibility of road network from Doma to Honiara. Although Doma is declared as the new township location for Guadalcanal Province there has since no major development except for the satellite Venue of Cultural Village which was built in mid 2012. Also within the neighbourhood is the construction base and a couple of Hamlets within vicinity.”
Her valuation method was set out,
“Valuation Approach
In deriving a value for the subject properties the three valuation methods were applied and used with the available data and evidence in hand. However the Historical Comparative Method was considered because there are no improvements thereon and the crops identified to be income generating crops which a couple where found thereon have not generated income for more than a decade or so and thus cannot be used for assessment to give value to the land.
There are four land parcels herein:

	Description	Area (ha)	Area (m²)	Unimproved Value @$15.00/m²
1	Lot 13	0.30	3000	$45,000.00
2	Lot 12	0.37	3700	$55,500.00
3	Lot 11	0.41	4100	$61,500.00
4	Lot 10	0.40	4000	$60,000.00
	Total	1.48	14,800	$222,000.00

Plus locality (3%) = $6,660.00
Reconciliation of Value
Based on the historical cost calculation above it is the component of unimproved value that the land areas of subject be valued at $228,660.00 the rate used per meter square of $ 15.00 is compared with sales ranging from $8.00 to $20.00 for areas at Doma. Given the locality of the parcels and the relativity of character it possess the amount per meter square and the percentage of locality gives value to the parcels of land to be at $228,660.00

The total value then was suggested to be $ 230,000 for the four blocks or lot. Her valuation of parcel 12 and 13 (described as lots 10 and 11) were $60,000 and $ 61,500 respectively. There was no attack made as to the basis or accuracy of these values so I am left with these figures. But, by paragraph 10 of his statement John Hue says;
“I refused to continue with the sale of lot 12 and 13 to the defendants because they do not interest (sic) to comply with the Land and Titles Act provision to purchase the whole price including its stamp duties”
That is both reason for refusal to continue with the sale and expression of opinion about the effect of the Land and Title Act on agreement for sale of Land. Such agreement may only be valid when it reflects the value of the land at some particular time. In this case perhaps the time of the valuation by Wendy Koisau Sade given on the 20 March 2014. Whilst the reason is clear, the expression of opinion of the law as it affect agreements for sale of land is misguided. It is the opinion of an unqualified authority as to the law as it affects sale of land. The Land and Titles Act does not mandate such term in any agreement for sale of Land. The issue of stamp duty on sales less than full value or by gift for instance is unrelated to the Land and Title Act. That issue relates to the document of any agreement requiring a stamp and does not have any bearing on the terms of any agreement for sale freely entered into.

The question then is whether in terms of the amended defence and counter-claim, an agreement for the sale of parcel 12 and 13 (lots 10 and 11) has been made out, breach of which has in terms of the defence, fraudulently deprived these defendants of the benefit of any such agreement for sale of lots 10 and 11.

On the 4 March 2014 the defendants made a cash payment of $40,000 to the claimant pursuant to asserted agreement, an agreement admittedly oral. Paragraph 4 of the Counter claim;
“The First and Second Claimants and the Defendant agreed that the Defendant will facilitate the lease transfer process with the Guadalcanal Provincial Government, the then title holder of the properties and thereafter transfer Lots 12 and 13 to the First and Second Claimants whilst the other 2 lots transferred to the Defendant.”

The payment is impliedly admitted. For by letter of 22 September 2015 by Mauri Lawyers for the claimant, the $40,000 payment was acknowledged as contribution, “which in the interim, is less than the valued price of any one plot of the three (3) plots”. The letter principally addressed a breach of the “Partnership agreement” and its consequences, I shall come back to this letter.
As evidence in support of this agreement, the defendants rely on a letter dated 13 April 2015 by the claimant to the Guadalcanal Town and Country Planning Board. This letter is set out in full and is one of a number of documents admitted.

“Secretary P. O. Box R 57
Guadalcanal Town & Country Ranadi
Planning Board
P. O. Box GC7
Honiara 13^th April 2015
Dear Sir,
Re: Consent to Develop Properties Lot 12/13 Doma West Guadalcanal

I hereby consented for Mr. Robertus and Rere Bochman to develop lots 12 and 13 while waiting for the transfer of said lots adding their names as equal joint ownership of these said lots from the Ministry of lands and Housing.

The instrument has been submitted and the process of the registration is in progress with relevant authorities.

Mr. Robertus and Reve Bochman’s documents for the development are enclosed.
Mr. Robertus and Rere Bochman are hereby copied.
Your sincerely,

Dr. John Hue
Registered Owner
Cc: 1. Lands officer Guadalcanal Province
2. Commissioner of Lands Ministry of land & Housing
3. Mr. Robertus & Rere Bochman

On the 24 November 2015, when relations between these parties may be said to have broken down irretrievably, a letter under hand of Mauri Lawyers was sent the Public Solicitor (then acting for the Bochmans) and included the following paragraphs relevant to these proceedings. This letter may be used by the court as evidence of the matters contained for it is contrary to the claimants’ interest, written by his authorized lawyer and is not covered by any privilege. I reproduce those parts;
“Secondly, the property at Doma consists of four blocks/Lots. These four blocks were applied for and granted to our client, Dr. John Hue individually. Correctly, the titles of the four blocks are now in his name as lease holder. Your client came into the picture only as interested purchaser. As you rightly stated they offered $40,000.00 to buy the two blocks. Whilst our client initially tried to have the two blocks transferred to your client, Lands office did not agree. The basis is that, Lands demanded a proper sale and purchase Agreement based on a proper valuation of the two blocks. In any case, $40,000.00 for two blocks of land is laughable. This information was clearly relayed to your client. They were also told to pay at least a further $ 40,000.00 so that a proper sale and Purchase Agreement can be signed before Lands can transfer the titles to them. As you are aware, this is very important for purpose of tax (stamp duty). Your clients did not come forward with the money, may be thinking they can take the two blocks on a plate and evade paying tax.

Any development on the land undertaken by your client is not client’s problem. Your client should well know that they should secure the land title first before expending money trying to develop it.

Since relation between our clients has soured, our client, unless the above is addressed, has decided to revoke the offer to sell the two blocks of land to your client. Your clients’ $ 40,000.00 will be refunded and further your client is put on notice that within 30 days from the date of this letter they are to remove all their property situated on Lots 12 and 13.”
This letter reflects the defendants plea that there was an agreement for the transfer of two of the blocks. It may, in terms of the rule, allow words to be construed more strongly against the party using them. (verba chartarum fortius accepiuntur contra proferentem). See Fowkes v Manchester and London Assurance and Loan Association (1863) 3 B and S 917 at 929).

The defendants rely on an “agreement” to have particular parcels given them. In other words, the “agreement” upon which the counter claim is brought is one which “has some memorandum or note thereof, in writing and is signed by the party to be charged or by some other person there unto by him lawfully authorized.”^[1]

The provision to the section goes on to say;
“117.-(1) No registered interest in land shall be capable of being created or disposed of except in accordance with this Act and every attempt to create or dispose of such interest otherwise than in accordance with this Act shall be ineffectual to create, extinguish, transfer, vary or affect any such interest.
(2) Nothing in this section shall be construed as preventing any unregistered instrument from operating as a contract, but no action may be brought upon any contract for the disposition of any interest unless the agreement upon which such action is brought, or some memorandum or note thereof, it in writing, and is signed by the party to be charged or by some other person thereunto by him lawfully authorised.

Provided that such an action shall not be prevented by reason only of the absence of writing, where an intending purchaser or lessee who has performed or is willing to perform his part of a contract-
(i) has in part performance of the contract taken possession of the property or any part thereof; or
(ii) being already in possession, continues in possession in part performance of the contract and has done some other act in furtherance of the contract.

It is an axiom of law that “form” does not go to the existence of a contract rather the “form” (in terms of the Land and Titles Act) need be proven before an action may be commenced.
I am satisfied there was an agreement at the time the money was advanced by the Bochmans to the claimant, John Hue for two lots to be given the Bochman from the 4 lots making up the parcel taken by the claimant from the Premier. That is reflected in the letter of Mauri Lawyers who recounted the agreement to “have two blocks transferred.” Subsequently the claimant on reflection it seems, after attempting to complete the agreement by transfer at the Lands office, in the absence of a Sale and Purchase Agreement, has reneged for reason going to matter apparently raised by the Land office, but reasons not relevant to the agreement between the Bockmans and Hue. As evidence of the agreement, the Bockmans had in part performance of the agreement, taken possession of the two lots (part of the property) and in furtherance of their acceptance of the “agreement” expended some $100,000 (uncontradicted) in developing these lots. The letter signed by John Hue, whilst for a different purpose (for it was sent to the Guadalcanal Town and Country Planning Board) I find amounts to a “memorandum or note” necessary for purpose of S.117 of the Act. Latter repudiation by Solicitors letter is further evidence of the agreement.^[2]

Clearly from the material above, the parties and subject matter of the “agreement” are identified. The payment of moneys is valuable consideration. It is immaterial that the claimant had changed his mind when he later believed the property was worth more. I am not satisfied however, the Bochmans may now claim the 4 lots of the property, for the agreement was party performed by the use of two parcels or lots and the claimant acknowledges his intention to transfer lots 12 and 13 in his letter of the 13 April 2015 to the Town and County Planning Board. His assertion in that letter of allowing “equal joint ownership” cannot stand in the face of the admission in paragraph 10 of his statement that the $40,000 was “for payment for Lots 12 and 13 they want from me”.

As I have found, only after words with the Land office did he repudiate the agreement, having accepted the money.
The doctrine of part performance as provided for in S.117 (2) has been stated by Fry on Specific Performance as follows:
“In order thus to withdraw a contract from the operation of the statute, several circumstances must concur: first, the acts of part performance must be such as not only to be referable to a contract such as that alleged, but to be referable to no other title; secondly, they must be such as to render it a fraud in the defendant to take advantage of the contract not being in writing; thirdly, the contract to which they refer must be such as in its own nature is enforceable by the Court; and fourthly, there must be proper parol evidence of the contract which is let in by the acts of part performance.”^[3]

I am satisfied on the material relied on by the defendants, set out above, that the doctrine has been brought into play. In terms of acting on the promise of John Hue the Bochmans have changed their position for the worst, having spent money developing the two blocks which they presumed would be transferred to them, so that in equity it would be wrong to allow the claimant, John Hue to benefit from his fraud. For he had the properties in his name yet breached the agreement to transfer 2 lots to the Bockmans.

There is no uncertainty about the terms of the contract. The payment directly related to the transfer of lots 12 and 13 to the Bockmans. Those lots were registered by the name of John Hue and he in equity is required to carry out the terms of the agreement, partly performed by the payment of $ 40,000 to him and evidenced by moneys expended to develop the plots as the claimant acknowledged in his request to the Planning Board. The fact that the consideration for the agreement to transfer the two lots, $40,000 was subsequently shown to be below market value is not relevant for consideration need not be adequate. For its adequacy is for the parties to determine at the time of the agreement^[4]

The consideration was executed, or present since the moneys were paid.
It would seem these persons fell out in their relationship after time, but that falling out over partnership disputes merely crystallized the land agreement.

For all these reason, I am satisfied the claimant case must fail. I give judgment in favour of the defendants counter-claim with the following change.

The Registrar of Title is ordered pursuant to S.229 of the Act to rectify by cancellation of the registration of John Hue as owner of the leasehold estate in parcel no’s 191.049-12 and 191-049-13 obtained by fraud and register the names of Robertus Bochman and Rere Bochman in his place. I make further orders in terms of paragraph 15 b) and e) of the amended counter claim filed 6 May 2016.

^[1] Land and Title Act S.117(2)
^[2] Buxton v Dixon (1872) LR7 Ex.279;Thrikell v Cambi (1919) 2 KB.590
^[3] Rawlinson v Ames, (1925) 1 Ch.96,at p.114
^[4] Bolton v Madden (1873) LR 9QB55 per Blackburn J at 57

High Court of Solomon Islands

Hue v Bochman [2018] SBHC 7; HCSI-CC 60 of 2016 (31 January 2018)