IN THE MATTER of Mortgage No. 357232
given by Hemant Kumar (f/n Guru Prasad) and Roselyn Roshni Kumar (f/n Donald Santa Dass) in favour of the Colonial Mutual Life Assurance
Society Limited over the land being Certificate of Title No. 12067
BETWEEN:
THE COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LIMITED
Plaintiff
AND:
HEMANT KUMAR
(f/n Guru Prasad) and
ROSELYN ROSHNI KUMAR
(f/n Donald Santa Dass)
Defendants
Mr. S. Parshotam for the Plaintiff
Mr. Sharma for the Defendants
JUDGMENT
By Originating Summons dated 27 February 1997 the Plaintiff (the "CMLA") seeks the following reliefs:
1. Delivery by the Defendants to the Plaintiff of vacant possession of ALL THAT piece or parcel of land situated on the Island of Viti Levu in the District of Suva and comprised and described in Certificate of
Title No. 12067, being Lot 23 on Deposited Plan 2103 "Qamu" (Part of) located at 23 Nakauvadra Road, Delainavesi, Lami
TOGETHER WITH all improvements thereon, as charged by the Defendants to the Plaintiff by Mortgage No. 357232 on 3 January 1994 to secure the money
therein mentioned.
2. An Injunction restraining the Defendants, their servants, agents or employees from interfering with the improvements on the said
property in any way so as to deplete its value.
3. Such further or other relief as seems just and equitable to this Honourable Court.
4. Costs of this action.
Introduction
The First Defendant on behalf of himself and the second Defendant filed an Affidavit in Reply sworn 22 April 1997 in response to CMLA's
Affidavit in Support of its Summons. On 24 July 1997 CMLA filed an Affidavit in Reply sworn the same day.
On 17 September 1997 the matter came before me for hearing when both counsel agreed to file written submissions. The CMLA filed its
on 29 September 1997 but the Defendants did not file theirs at all.
The facts
The salient facts of the case have been very clearly set out by Mr. Parshotam in his submission which is as follows:
"The Defendants are the registered proprietors of all that land comprised in Certificate of Title No. 12067. Erected on the land
is a substantial residential property in which the Defendants reside.
On 3 January 1994, the Defendants executed a mortgage over the said land, bearing registration no. 357232, in favour of the Plaintiff.
The Mortgage was given by the Defendants to secure, inter-alia, banking advances and accommodation given or to be given by the Plaintiff
to the Defendants.
Paragraph 13 of the said mortgage reads as follows (the Plaintiff is described therein as "the Mortgagee" and the Defendants
are described as "the Mortgagors"):
"13. That upon default by the Mortgagors in the payment when due of any part of the principal interest or other moneys hereby
secured or in the observance or performance of any covenant condition or agreement herein expressed or implied the whole of the principal
interest and other moneys then remaining hereby secured shall (at the option of the Mortgagee) become immediately due and payable."
The Defendants made defaults in payment to the Plaintiff under the mortgage and the Plaintiff proceeded to exercise the powers vested
in it pursuant to such default.
The Plaintiff also gave notice by a Demand Notice dated 12 April 1996 to the Defendants demanding payment of the amount then owing.
The amount then owing was $98,427.53 plus further interest accruing at the rate of 11.5% p.a.
On 23 July 1996, the Plaintiff gave notice to the Defendants to deliver vacant possession of the said property by 31 July 1996.
Despite the said notice, the Defendants have failed to vacate the said property".
Plaintiff's contention
The CMLA's contention is that the defendants chose their own builder and entered into a building contract with him. The part played
by CMLA was that it provided them with loan finance to assist them in the construction of their residence. It says that it was the
defendants' responsibility to complete the construction of the building and to make mortgage repayments.
Defendants' contention
In short it is the defendants' contention that they were advised by CMLA that they were not obliged to make any repayment under the
mortgage until the building is complete and when they start to receive rent for the property. They say that the building is still
incomplete.
The issue
The issue for Court's determination is whether CMLA is entitled to possession of the land or not in the circumstances of this case.
Determination of the issue
I do not propose to traverse everything that has been stated in the various affidavits filed herein and in the submissions of learned
counsel for CMLA. Since there is no submission from the defendants' counsel, I have received no assistance from him on the issue
for my determination except what is contained in the defendants' said affidavit in Reply.
The Law
This summons has been issued under Order 88 of The High Court Rules. This is an application for possession of land by the mortgagee
(the "CMLA") and hence an application under Or 88 can be made. Or 88 r.1 provides:
"1. - (1) This Order applies to any action (whether begun by writ or originating summons) by a mortgagee or mortgagor or by any
person having the right to foreclose or redeem any mortgage, being an action in which there is a claim for any of the following reliefs,
namely-
(a) payment of moneys secured by the mortgage,
(b) .....
(c) .....
(d) delivery of possession (whether before or after foreclosure or without foreclosure) to the mortgagee by the mortgagor or by any
other person who is or is alleged to be in possession of the property.
(e) .....
(f) .....
(g) ....."
This is a 'mortgage action' [Or 88 r.1(3)]. Here is an action for possession arising out of non-payment of amount due under the mortgage in respect of which
demands have been made but not met by the defendants.
The CMLA has complied with the requirements of Or 88 r.3 in respect of a mortgage action begun by originating summons.
It is not disputed that there is a mortgage. The only area where there is disagreement, in a nutshell, is that payment thereunder
is not due as yet as the building is still incomplete. This the CMLA refutes in no uncertain terms.
Mr. Parshotam has referred the Court to certain passages in Halsbury Vol. 32 4th Ed. In para. 672 (ibid) on mortgage, which is in
point, it is stated:
"Where a legal mortgage has been created and no provision is made for the retention of possession by the mortgagor, the mortgagee
is entitled to immediate possession or receipt of the rents and the profits at any time after the execution of the mortgage, and
equity does not interfere, notwithstanding that there has been no default on the mortgagor's part, or that a bill of exchange has
been given for the debt, or that considerable time has elapsed, provided that an action for possession is not statute-barred."
Further at para 675 (ibid) it is stated:
"Where the right of entry is to arise only on default in payment of the mortgage debt on demand, reasonable time should be allowed
for compliance with the demand before the mortgagee enters. (Toms v. Wilson [1827] EngR 279; (1863) 4 B & S 455, Ex Ch)."
And at para. 676 it reads:
"When the mortgagee has a right of entry and allows the mortgagor to remain in possession, he is not bound to give any notice
to the mortgagor before entering; and similarly he can bring an action or demand of possession."
Findings
The determination of the issue before me depends on my finding of facts on the affidavit evidence.
I accept Mr. Parshotam's arguments and find that there was no agreement such as that alleged by the defendants that there will be
no repayments until the construction work is completed and when the defendants start receiving rent for the said property. This was
a straight out loan transaction in the amount which CMLA advanced. In fact the defendants made some repayment under it and sought
further time to pay but they were unable to pay. The defendants even commenced living on the property despite the assertion that
it was incomplete.
In all the circumstances of this case I consider this to be a proper case for the application of provisions of Or.88. No legal defence
has been raised by the defendants apart from what they assert in their affidavit despite the opportunity given them to make written
submission.
In the outcome, the Plaintiff succeeds in its application and for the above reasons I make the following orders:
(a) That the defendants give immediate vacant possession of the property comprised in C.T. 12067 to the Plaintiff with execution stayed
for one month from the date of this judgment.
(b) Injunction is granted restraining the defendants their servants, agents or employees from interfering with the improvements on
the said property.
(c) I award costs against the defendants to be taxed if not agreed.
D. Pathik
Judge
At Suva
16 January 1998
Hbc0072j.97s
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