Paane v Mone [2008] TOLawRp 46; [2008] Tonga LR 232 (8 September 2008)

IN THE LAND COURT OF APPEAL
Land Court, Nuku'alofa

L 20/2005

Paane

v

Mone anors

Shuster J
19-22 May 2008; 8 September 2008

Land law – status of grant of allotment – fairness and justice most important – equivalent parcel of land ordered to be given

Sometime in 1960 the plaintiff moved from Ha'apai and settled in Ma'ufanga so that his children could attend school. In 1971 he obtained title to a town allotment in Halaleva which was part of the Fakafanua (third defendant) estate. At one point the plaintiff purchased, owned and operated a dump truck and the third defendant made use of the plaintiff's dump truck over a considerable period of time on construction projects in and around his estate. The plaintiff claimed that in 1972 the third defendant gave him the use of another town allotment in his estate for services rendered through the use of the dump truck. In January 2001 the plaintiff became aware that, without his knowledge or consent, the estate holder had agreed to lease this other allotment to the second defendant for the construction of a residence for the Minister of the second defendant Church. In November 2001 the fourth defendant, the Minister of Lands, registered the grant of the lease and the second defendant proceeded to construct a dwelling house for its Minister. The plaintiff sought an order cancelling the lease and directing the second defendant to vacate the allotment and, in the alternative, damages in the sum of $180,000. The plaintiff contended that the grant of the allotment to the second defendant was made fraudulently, by mistake, or by misrepresentation in that the land was not available because it had been occupied by him for some years. The fourth defendant claimed that there was no evidence to support the allegation of fraud and misrepresentation because the Minister was not aware of any lawful occupation by the plaintiff. The defendants also claimed that the alleged grant of the allotment by the estate holder to the plaintiff was unlawful under sections 13 and 48 of the Land Act.

Note: this judgment was successfully appealed to the Court of Appeal: see [2009] Tonga LR

Held:

1. There was no basis for a finding that the grant by the fourth defendant was made fraudulently, by mistake or by misrepresentation.

2. The most important point in the case was the issue of fairness and justice. The estate holder had been willing to settle the case without going to court and had offered another allotment as compensation to the plaintiff. The damages claim of $180,000 was unsubstantiated by direct evidence.

3. The plaintiff had a legitimate expectation that the land offered to him by the estate holder would be his for the rest of his natural life and the land had been gifted to the plaintiff for life.

4. The court declined to order the cancellation of the lease or the vacation of the land by the second defendant. The third defendant was ordered to give to and register in the name of the plaintiff an equivalent parcel of land to that lost under the lease and the first and second defendants were ordered to pay $20,000 to the plaintiff as compensation and 90% of the plaintiff's costs.

Cases considered:

Halsey v Milton Keynes NHS Trust [2004] EWCA Civ 576; (2004) 1 WLR 3002

Tuiono v Tulua 2 Tonga LR 36

Vai v Uliafu [1989] Tonga LR

Statute considered:

Land Act (Cap 132)

Counsel for the plaintiff : Mr Niu
Counsel for the first and second defendants : Mr Tu'utafaiva
Counsel for the third defendant : Mr Tupou
Counsel for the fourth defendant : Ms Mafi

Judgment

Parties

The Plaintiff is 84 years of age, a citizen of Tonga; he lives at Ngeleia Ma'ufanga with his wife and children. The first defendant is the President of the Free Wesleyan Church. The second defendant is a Church and forms the largest religious denomination in the Kingdom of Tonga. The third defendant is the current holder of the estate of Ma'ufanga. The fourth defendant is the Minister of Lands, and the person authorised by law to grant and register leases of land, with the consent of Cabinet.

Background

Sometime in 1960 the Plaintiff moved from Haapai and settled in Ma'ufanga so his children could attend school. In 1971 the Plaintiff bought a town allotment consisting of 30 perches in Halaleva from Funaki Vikilani for $2,000.00. The town allotment had been subdivided from a larger tax allotment belonging to Funaki Vikilani, and was part of the Third Defendant's estate.

This town allotment had never been registered by the Plaintiff or by any member of his immediate family.

The Plaintiff was for most of his early life a builder and handyman by trade. At a point in time he purchased, owned and operated a dump truck. There is no dispute between the parties the Third Defendant made use of the Plaintiffs truck on construction projects in and around Ma'ufanga, and used the truck over a considerable period of time.

The Plaintiff testified the Third Defendant gave him the use of another town allotment at Halaleva Ma'ufanga sometime in 1972. That allotment is shown as allotment no. 7 on exhibit 4, and measured 38.3 perches. The plaintiff claims this piece of land was gifted to him in 1972 for services rendered to the Third Defendant for work carried out on his estate. This assertion is in dispute.

The Plaintiff claims he fenced the allotment and cultivated it with crops for the maintenance of his family from 1972-2001. The Plaintiff claims on 8 January 2001 without his knowledge or consent, the Second and Third Defendants agreed the Second Defendant could lease his allotment from the Third Defendant for the construction of a residence for a Minister of the Second Defendant's Church.

On 26 January 2001 the plaintiff learnt about plans to build the Minister's residence on his allotment - so he made certain representations to the church; via the President of the Church the First Defendant; he also contacted the Lands Office. As a result of his representations, the First Defendant directed the Church Secretary to write to the Fourth Defendant directing him to stop the application for a lease - pending further investigation.

On 7 May 2001 the First Defendant wrote to the Fourth Defendant directing him to proceed with the lease application - by the Second Defendant. A formal application was signed by the parties and submitted to the Fourth Defendant for approval. The Fourth Defendant would not agree to a year lease on the land, so a subsequent application was submitted and approved by the Minister and-endorsed by Cabinet as a 50 year lease.

On 15 November 2001 the Fourth Defendant registered the grant of lease no. 6765 with the Third Defendant as Lessor and the Second Defendant as Lessee for 50 years. The Second Defendant then constructed a dwelling house on the allotment for a Church Minister, and the Plaintiff was dispossessed.

The Plaintiff claims Judgment-and an Order against the Defendants:-

(a) For an order cancelling the lease granted by the Fourth Defendant awarded to the Second Defendant and an order directing the Second Defendant to vacate the allotment.

(b) Alternatively for damages in the sum of $180,000.00, or for such reasonable amount as the court may order as compensation- to be paid by the First and Second Defendant's in respect of the loss of the allotment; jointly and severable.

(c) For costs of these proceedings:- to be paid by the First and Second Defendants.

(d) Any other order (or relief) as may be just.

Submissions

• ON THE LAW: - the Fourth Defendant says the First Defendant was entitled to apply for an allotment under section 43(1) of the Land Act.

• The Fourth Defendant says Section 43(2)(a) and (b) of the Land Act was fully complied with and a deed of grant was issued to the First Defendant by the Minister of Land and was approved by Cabinet.

• Rationale: - there was no evidence before the Minister at the time he made his decision that the land had been registered or, was occupied by the Plaintiff or by anyone else.

• The Minister acted properly on the documents before him and after he had consulted records at his Department.

• The Fourth Defendant submits the allotment leased by the Second Defendant was an allotment out of land available from the Third Defendant's estate, see the case of Vai v Uliafu [1989] Tonga LR 50. (Sub-section (a) and the interpretation of section 50 of the Lands Act).

The subsection states that an applicant for an allotment shall have his allotment out of "land available" for allotment in that estate. The court held that land available means that land did not include land occupied by other people.

• The Fourth Defendant argues the Third Defendant's predecessor was fully aware the Plaintiff had purchased another town allotment from his estate.

• It was also clear the Plaintiff did not register his interest in the land. The Fourth Defendant says the Plaintiff had an intention to hold two town allotments at the same time which they say is unlawful.

• The Fourth Defendant says the onus is on the estate holder to know his land and the people who occupy his land or who might tend to occupy his land.

• Once an estate holder signs the Ministry's application form, the Ministry deems the estate holder has discussed the allotment with the applicant, to say he was satisfied the applicant was the right person to register the allotment.

• The Fourth Defendant says there was no mistake in this case on the part of the Fourth Defendant — and I fully accept this proposition.

• The Fourth Defendant was not privy to discussions or dealings between the parties the Fourth Defendant granted the lease to the Second Defendant based upon information it had the information indicated the land was available.

• The Fourth Defendant took the view once a deed of grant is registered under the Land Act; it becomes final unless registration has come about as a result of an error of law, mistake, fraud, or misrepresentation, or breach of natural justice, or promise of a Minister.

• The Plaintiff in his Statement of Claim claims as an alternative-the grant of lease to the Second Defendant-was as a result of fraud and misrepresentation by the Fourth Defendant; and the plaintiff's objection had been resolved; when it had not.

• The Fourth Defendant says there was no evidence to support that claim, because the Minister was not aware of any 1awfu1 occupation by the plaintiff, and he was not aware of competing claims by the parties, nor was he aware of any dealings between the Plaintiff and the First, Second and or the Third Defendants.

Findings of fact – I find no basis to say the grant of the lease by the Fourth Defendant to the Second Defendant was made fraudulently, by mistake, or by misrepresentation.

The third defendant

• Noble Fakafanua is the estate holder of the land in dispute. The Fakafanua directly involved with dealings involving this piece of land was the grandfather of the present Fakafanua. He died in 2004. The father of the present Fakafanua died in 2006.

• This action was commenced after the death of the first Fakafanua. The father of the present Fakafanua inherited this cake. Court records show the Third Defendant lodged his Statement of Defence out of time; the Defence was accepted out of time with the leave of the court.

• The current Fakafanua readily accepts he inherited the case from both his father and his grandfather.

• Counsel emphasised there is no claim in the Statement of Claim against the Third Defendant; the Third Defendant accepts any judgment over the parcel of land will affect him as estate holder; to the extent that he will either retain the present tenant or acquire a new one.

• The Third Defendant emphasised many times he tried to settle this matter out of court-but failed. He tried to settle by offerin the Plaintiff the use of another piece of land situated within his estate; he even offered to register the land in the plaintiff's name. I accept the Third Defendant has taken a neutral stance throughout the proceedings.

• The evidence revealed the Plaintiff whilst saying he would accept a fresh parcel of land, went on to ask for compensation of $25,000 from the First and Second Defendants-but they refused. The Third Defendant's offer of a parcel of land remained open, but, the Third Defendant pointed out he will have to pay legal costs because the case went to trial-when he always wanted to settle.

Finding of fact: - it is clear from the evidence the Third Fakafanua wished to settle this case out of court, by giving a similar piece of land to the Plaintiff and registering his interest at the Land Office. In my view he acted as a reasonable man.

The first and second defendant

• The First and Second Defendants say the Plaintiff's Claim should fail for the following reasons. The first ground is set out in paragraph 18 (a) together with paragraph 6.

• The Plaintiff rendered services to the Third Defendants during the 1960s and 1970s the Third Defendant rewarded the Plaintiff with the town allotment in dispute. The Plaintiff occupied and used the allotment until it was granted by the Fourth Defendant to the Second Defendant.

• The First and Second Defendants say this ground in the Statement of Claim must fail, because the Plaintiff failed to prove the estate holder granted him the allotment in 1972. The evidence of Semisi Halahola shows the estate holder at the time told Semisi in December 1971 the allotment was Nailoni's allotment. Semisi cultivated the land and used it on the understanding it was Nailoni's allotment; he was not challenged on his evidence.

• In a letter dated 24 January 2001 the estate holder clearly stated the Plaintiff had been given another allotment. The evidence shows the estate holder did not know who wrote the Plaintiff's name in pencil on the lot in dispute (Exhibit 4) on the Land Office copy.

• The First and Second Defendants say the Plaintiff did not return to confront the estate holder or complain about Semisi and his use of the allotment.

• For these reasons the First and Second Defendants say the Plaintiff has failed to prove the estate holder granted him the allotment in 1972. Alternatively, if the allotment was granted by the estate holder to the Plaintiff in 1972, they say the grant was not lawful and of no effect.

They say it was unlawful because

Firstly:-

• Section 6 of the Land Act provides that every verbal disposition by a holder and a holder is defined in Section 2 to include an estate holder, of any allotment which purports to effect a voluntary conveyance is mill and void.

Secondly: -

• In Tuiono v Tulua 2 Tonga LR 36 adopted by Webster J in Vai v Uliafu [1989] Tonga LR 56 at page 61 it stated: -

"A noble cannot confer legal titles to land, and cannot grant either town or tax allotment valid as such in law"

Thirdly: -

• The alleged grant of the allotment, by the estate holder to the Plaintiff, for services rendered by the Plaintiff to the estate holder is unlawful because of section 13 of the Land Act, which provides among other things

"Any holder who enters or attempts to enter into any agreement for profit or benefit relating to the use or occupation of his holding or part thereof other than in the manner prescribed by this Act or as approved in writing by the Minister shall be liable on conviction to a fine."

• The First and Second Defendants ay the grant of the allotment to the Plaintiff for services rendered, and the acceptance by the Plaintiff of the grant is an agreement for profit or benefit, relating to the use or the occupation of the estate holders estate, which agreement is not in any manner prescribed by the Act, or approved by the Minister in writing.

• They say the alleged agreement is therefore unlawful and of no legal effect, I have to say I do not agree with that proposition. In his evidence the Plaintiff agreed he was already in possession and occupation of the allotment from Vikilani which he still possesses and occupies and that allotment is also on the Fakafanua estate. This is not allowed by Section 43(1) and 48 of the Land Act-the Defendants say.

Section 43(1)

"Every male Tongan Subject by birth of 16 years of age not being in possession of a tax or town allotment shall be entitled to the grant of a tax or town allotment ..."

Section 48

No person who already holds a tax allotment or town allotment shall be granted a second allotment of the same kind as he already holds and any such grant shall be null and void ..."

• The First and Second Defendant's submit that at the time of the alleged grant of the town allotment in dispute the Plaintiff vas already holding the town allotment. The two allotments are of the same kind, namely town allotments. The plaintiff had not registered the town allotment from the Vikilani land but, the Defendants say the Plaintiff holds it within the meaning of Section 48 because Section 2 of the Act defines a holder to mean, amongst others: -

"Any Tongan subject claiming to be interested in land, which he is legally entitled to hold"

• The First and Second Defendants say there is no evidence the Plaintiff is not legally entitled to hold the town allotment from the Vikilani land. They say the alleged grant by the estate holder of the town allotment in dispute is not lawful and thus not effective.

The Defendant's collectively say I need go no further-or consider other matters. They say the Plaintiff's Claim must fail-and his claim ought to be dismissed with costs.

Issue of fairness and justice

I now turn to the most important point-in this case, that is the issue of fairness and justice. If the court accepts the Plaintiff's evidence; either in whole or in part, and if the Court accepts the Plaintiff served the late Fakafanua in the manner in which both he and his wife testified, and, the court accepts the Plaintiff was granted a lifelong lease by the late Fakafanua in that estate, then an injustice will have occurred if the Plaintiff was improperly displaced from his land. This would be an injustice which must be corrected by this Court as being only just-fair- and equitable.

I fully accept the testimony given in court by the Third Defendant - of his willingness to settle this case, and many other cases- when he succeeded his late father, without going to court. The Third Defendant told me he has taken steps to register parcels of land within his late father's estate with the Land Office, when he assumed responsibility for the management of his estate.

The Third Defendant said his offer of a parcel of land for the Plaintiff was still available-up to the trial as compensation for the Plaintiff Negotiations had taken place between the First and Second Defendants-and the Plaintiff concerning the issue of monetary compensation-but, I was told the parties were unable or were unwilling to settle.

I turn to the figure of $180,000.00 claimed by the Plaintiff as compensation for his loss? In my opinion the Plaintiff just picked, or-plucked a figure of $180,000.00 out of the air, as a figure he considered adequate compensation for losses he says he incurred over time. There are no receipts or invoices available to the court most probably due to the passage of time. The figure of $180,000.00 appears to me grossly exaggerated, unrealistic and wide of the mark-considering Tonga's economic climate.

Finding of fact- I find as a fact, the claim for $180,000.00 is unsubstantiated by direct evidence.

In my view the Plaintiff will have had and will always have a legitimate expectation; the land offered by the late Fakafanua as a gift to him for services rendered-would have been his to deal with; for the rest of his natural life. On the evidence before me I find as a fact the parcel of land in this case was gifted to the Plaintiff for life.

It was only the intervention of the First and the Second Defendants; by their application for a lease for the construction of the Ministers residence that the Plaintiff was deprived of the use of his land; and which as I have said, and have no doubt was, gifted by the late Fakafanua-for the whole of the Plaintiff's life.

With all the expectations which exist in today's society, if a man's word is to be his bond; then- if the land was gifted for a lifetime in the manner described by the Plaintiff, then there must be a legitimate expectation on his behalf the land would never be taken-sold or leased to another party- effectively pulled out from under his feet- as sadly happened here.

In my view this case - like many other cases- should have been settled by the parties without going to court; in view of the narrow issues which needed to be resolved, and because of the publicity and expense a trial brings:-leading case of- Halsey v Milton Keynes NHS Trust [2004] EWCA Civ 576; (2004) 1 WLR 3002.

Conclusion

• I find for the Plaintiff in this case.

The Plaintiff is to receive the following by way of compensation for the land lost-for which in my view he was entitled to occupy for the rest of his natural life.

Order

• I decline to order lease no 6765 be cancelled, or, the Second Defendant ordered to vacate the land within 3-months of the date of this order.

• The court orders judgment against the First, Second and Third Defendants; as follows.

• The Third Defendant is to gift to- and register in the name of the Plaintiff- an equivalent parcel of land-to that lost under lease no 6765.

• That parcel of land is to be situated within a reasonable walking distance of the Plaintiff's current — home residence.

• The First and Second Defendants are to pay the sum of $20.000.00- to the Plaintiff as compensation for the loss of the use of his original parcel of land- within 30 days.

• The First and Second Defendants only are to pay 90% of the costs of these proceedings, (to be taxed by the Chief Registrar)

• I order 90% of the costs be paid by the First and Second Defendant- because-this case should have been settled by the parties-and that includes the Plaintiff- and-settled out of court by mediation.

(Authority- leading case Halsey v Milton Keynes NHS Trust [2004] EWCA Civ 576; (2004) 1 WLR 3002)