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Vanua Levu Hardware Ltd v New World Ltd [2011] FJHC 496; Civil Action 09.2011 (1 September 2011)

IN THE HIGH COURT OF FIJI
AT LABASA
CIVIL JURISDICTION

CIVIL ACTION NO: 09 of 2011

IN THE MATTER of an application under Section 169 of the Land Transfer Act Cap. 131 for an Order for Vacant Possession.

BETWEEN:

VANUA LEVU HARDWARE LIMITED a limited liability company having its registered office at 15 Jaduram St, LABASA
PLAINTIFF

AND:

NEW WORLD LIMITED a limited liability company having its registered office at 211 Kings Rd, BA
DEFENDANT

BEFORE: MASTER ROBINSON

COUNSELS: Mr. Vosarogo of MAMLAKAH LAWYERS for the PLAINTIFF
Mr. A Narayan of AK LAWYERS for the DEFENDANT

RULING

THE APPLICATION

This is an application by Summons dated 11 March 2011 for vacant possession made by the Plaintiff pursuant to Section 169 of the Land Transfer Act. Cap. 131.

The defendant is summoned to appear before the Master in Chambers at the High Court in Labasa on the 13 April 2011 to show cause why they should not give up vacant possession of the Plaintiff's property referred to as Allotment 17 in Crown Lease No: 26463 and Lots 2A, 2B & 2C on plan M2444 on Crown Lease No: 9129 and situated on Labasa Town.

The Summons did not specify which limb of s 169 the Plaintiff was relying on but he is clearly within paragraphs (a) and (c) where the term of the lease has expired and a legal notice to quit was issued. The Summons was supported by an affidavit of Mr. Basir Khan as Managing Director of the plaintiff company sworn on 10 March 2011.

THE AFFIDAVIT IN SUPPORT

Mr. Basir Khan stated in his affidavit that he is Managing Director of the plaintiff company whose registered office is situated at Jaduram Street, Labasa. That the company is the proprietor of the subject land and in support of this contention annexed in his affidavit copies of the Crown Lease No: 26463 and Crown Lease No: 9129.

The affidavit also shows that the parties entered into a Memorandum of Agreement" on the 10 August 2006 for a term of three (3) years for the relevant property to be leased to the Defendant for a monthly rental of $14,000:00 commencing on the 1st September 2006. In so far as is relevant "Clause 9" of this agreement contained an option for the renewal of the tenancy. There were other features of the agreement that need not concern the Court at this stage.

The Summons for vacant possession and its supporting affidavit were served on the Defendant on the 22 March 2011 and well within the sixteen day period required under section 170 of the Land Transfer Act in that it was served not earlier than sixteen (16) clear days before the summons was to be heard.

THE AFFIDAVIT IN OPPOSITION

In opposition to the summons to vacate the defendant filed an affidavit deposed by one Raj Gopal Achariya of Varadoli Ba, the Administration Manager of the Defendant company. I do not need to state in detail the contents of the affidavit except as to say that the affidavit was extensive and deals with a lot of issues regarding the relationship between the parties which arose from the "Memorandum of Agreement". So far as is relevant though I would like to refer only to some issues raised and these are:-

1. That the Defendant entered into an agreement of tenancy with the Plaintiff for a term of three (3) years for a monthly rental of $14,000:00;

2. That there was an option to renew clause in the agreement;

3. That they had exercised the option but that the Plaintiff did not honour its obligation under the clause;

4. That the Defendant had lodged an application for a caveat to be registered against the leased property to protect its interest but that this caveat was wrongly removed;

The above are but some of the issues raised by the Defendant in its affidavit in opposition and it is clear from the affidavit that there are more issues at hand.

AFFIDAVIT IN RESPONSE

In reply to the affidavit in opposition the Plaintiff filed an extensive affidavit consisting of some 39 paragraphs. It is not necessary in my view to refer to all of the paragraphs in detail except as to say that, as in the affidavit in opposition, the Plaintiff acknowledges that there is an issue regarding the exercise of the option to renew the tenancy agreement and the dispute regarding the repairs of the property and the removal of the caveat.

DETERMINATION of the APPLICATION

Both parties at the conclusion of the hearing filed submissions and I thank them for filing the submission in time. I do not wish to address in detail the matters raised by the Counsels in their submissions but one thing is clear and that is the issues raised by them are extensive.

This application falls within section 169 sub-paragraphs (a) and (c) of the Land Transfer Act. This provisions states:-

169. The following persons may summon any person in possession of land to appear before a judge in chambers to show cause why the person summoned should not give up possession to the applicant:-

(a) the last registered proprietor of the land;

(b) a lessor with power to re-enter where the lessee or tenant is in arrear for such period as may be provided in the lease and, in the absence of any such provision therein, when the lessee or tenant is in arrear for one month, whether there be or be not sufficient distress found on the premises to countervail such rent and whether or not any previous demand has been made for the rent;

(c) a lessor against a lessee or tenant where a legal notice to quit has been given or the term of the lease has expired.

The fact of the matter is that the Plaintiff claims that he is the registered proprietor of the subject land and as the registered proprietor he was able to enter into a tenancy agreement, referred to as the "Memorandum of Agreement", with the Defendant. The "Memorandum of Agreement" created a relationship in which the Plaintiff became the "Lessor" and the Defendant the "Lessee", this relationship was sufficient to attract the provisions of sub-sections (a) and (c) of section 169.

Within the context of the above the Plaintiff must therefore prove by affidavit evidence firstly that it is the registered proprietor of the subject land. As is alluded to by the Defendant the document that needs to be produced must show that it is the registered proprietor of the land. Unfortunately this documentary evidence referred to in the affidavit of Basir Khan in paragraphs 5 and 6 and annexed as "BK 2" did not reflect this at all. Lease No: 9129 is in the name of " Surdarjee Brothers Limited and Lease No: 26463 is registered to one "Katawaru". The Court cannot by inference assume without clear evidence adduced in the affidavit that the Plaintiff is indeed the registered proprietor. The Court indicated to the Plaintiff's counsel that it would not be accepting any further evidence at that stage of the proceedings for reasons which would become clearer later.

The Plaintiff counsel was very helpful in its submission and suggested that it was sufficient for it to prove that it is the lessor of the property and the Defendant the lessee. There was sufficient evidence provided which shows this relationship and therefore the application came within sub-section (c) of section 169. The court agrees with the approach as it is clear from the documentary evidence that a lessor/lessee relationship exists by virtue of the agreement. This point was not disputed by the Defendant, the issue to them consists in the interpretation of the exercise of the option clause in the said agreement.

Counsel for the Plaintiff in opening its case stated that the application would turn on whether the option to renew the lease was properly exercised and in its opinion this option was not exercised in accordance with the option clause. The Defendant's counsel on the other hand said that it was. Much debate and correspondence was entered into between the parties regarding this. This court need go no further in the application from that point because this clearly shows that the Defendant has cause. He has cause because the option to renew will determine its right to remain in the premises. The Plaintiff's submission clearly shows that there is some dispute between the parties about whether the Defendant had properly exercised its option to renew the tenancy agreement under clause 9 of the "Memorandum of Agreement". To determine this issue oral evidence has to be adduced. It appears to the Court from the submission by the parties that they wanted the court to determine this issue for them. Unfortunately this is not the forum for that and as quoted by the Plaintiff in its submission whilst referring to this Court's decision in Miller –v- Miller, Labasa High Court Case No: 193 & 194 of 2010:-

Applications made under Order 113 of the High Court Rules or under section 169 of the Land Transfer Act are summary in nature and is intended to operate without the need for a trial involving the oral examination of witnesses and with a minimum of delay, expense and technicality. Hence it would normally apply in virtually uncontested cases or in clear cases where there is no issue or questions to try. That is, there is no reasonable doubt as to the claim of the plaintiff to recover possession of the land or as to the wrongful occupation of the land without licence or consent and without any right or interest.

The defendant has to show cause as to why he should not give up vacant possession (section 172) and in this regard the Defendant must show on affidavit evidence why the Court should not make an order for vacant possession. He does not have to prove a conclusive right to remain in possession only some tangible evidence establishing a right or at least supporting an arguable case for such a right (see Morris Hedstrom Limited –v Liaquat Ali (Action No: 153/87)

The phrase tangible evidence has often been used as a general criteria establishing a right or cause why the Court should not make an order for vacant possession under section 169. For the evidence to be tangible it must be real and capable to be established not a vague or an elusive perception of a right of possession. The matters raised, not only by the Defendant but by the Plaintiff as well in their respective affidavits and submissions conclusively shows that the question about the exercise of the optional clause needs to be determined by oral evidence.

In view of the above, the Court makes the following findings:

1. That the Defendant has shown cause on affidavit evidence pursuant to Section 172 of the Land Transfer Act to some right to possession which would preclude the granting of an order for possession in favour of the Plaintiff.

2. That the Plaintiff's right to seek further remedy is not exhausted and it may consider further action by writ action.

ORDERS

Accordingly the Court makes the following Orders:

1. That the Plaintiff's application for immediate vacant possession is denied in that it cannot be dealt with summarily under section 169;

2. That costs to be awarded against the Plaintiff which is summarily fixed at $750:00.

1 SEPTEMBER 2011

MASTER
ROBINSON H