Home | Databases | WorldLII | Search | Feedback High Court of Fiji

  Download original PDF

B.D Lakshman & Sons Properties Ltd v Morel [2016] FJHC 207; HBC157.2015 (30 March 2016)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION
CIVIL ACTION NO: HBC 157 of 2015

IN THE MATTER of the Property Law Act [Cap 130], Section 119.
AND
IN THE MATTER of an application for sale and transfer of the interests of Tom Karl Morel, Resina Nina Morel and Thomas Morel in the property comprised in Certificate of Title No. 2494.

BETWEEN:

B.D. LAKSHMAN & SONS PROPERTIES LIMITED a limited liability company having its registered office in Deuba, Fiji.
PLAINTIFF

AND:

TOM KARL MOREL, RESINA NINA MOREL, and THOMAS MOREL or their legal representatives, addresses and occupations unknown to the Plaintiff.
DEFENDANTS

COUNSEL : Mr. Vinit Singh for the Plaintiff
Mr. T. Bukarau for the Defendants

Date of Hearing: 21 January 2016
Date of Judgment: 30 March 2016

JUDGMENT

Introduction and Background

This is an application made by the Plaintiff, in terms of Section 119 of the Property Law Act (Chapter 130). The application has been made by way of an Originating Summons, and seeks, inter alia, for an Order of Court for the sale of the Defendants' interests in the property comprised in Certificate of Title No. 2494.

In terms of the Originating Summons, dated 15 April 2015 and filed on 16 April 2015, the Plaintiff prayed for the following reliefs, namely:

An Order that the property comprised in Certificate of Title No. 2494 ("the Property") be valued and the cost of the valuation be shared equally by the Plaintiff and the Defendants.
An Order for the sale and transfer of the Defendants' interests in the Property to the Plaintiff for a sum no less than the value of the Defendants interests according to the Valuation Report ("the Transfer").
That the Chief Registrar of the High Court, if required, be appointed to sign all such documents and do all such things as may be reasonably required in the name of the Defendants to complete the Transfer.
That the cost of the Transfer be shared equally by the Plaintiff and the Defendants.
That the Fiji Revenue and Customs Authority assess Capital Gains Tax on the Transfer and the Defendants be responsible for any Capital Gains Tax payable.
Alternatively, that the Plaintiff's share in the Property and the Defendants share in the Property be partitioned.
Such further or other relief as seems just and equitable to this Honourable Court.

Costs of this action.

[3] The Originating Summons was supported by an Affidavit deposed to and filed on 16 April 2015, by Prince Gopal Lakshman, the Managing Director, of the Plaintiff Company. On 9 July 2015, an Affidavit in Opposition was filed on behalf of all the Defendants. This was by way of an Affidavit deposed to by Tom Karl Morel, on 3 June 2015. On 25 August 2015, the Plaintiff filed an Affidavit in Reply to the said Affidavit in Opposition, by way of an Affidavit deposed to by Prince Gopal Lakshman on the same date.

[4] This matter was taken up for hearing before me on 21 January 2016. Both Counsel for the Plaintiff and the Defendants were heard. The parties also filed detailed written submissions, and also referred to several case authorities, which I have had the benefit of perusing.

The Affidavit in Support filed by Prince Gopal Lakshman

[5] The main issues that have been raised by the Plaintiff are found in the Affidavit in support filed by Prince Gopal Lakshman. The contents of the Affidavit are as follows:

He says that he is the Managing Director of the Plaintiff Company. The Plaintiff is a limited liability company having its registered office in Deuba and he is authorised to swear the affidavit on its behalf.
He deposes to the facts of his own knowledge, save and except where stated to be on information and belief, and where so stated, he verily believes to be true.

The Plaintiff is a holding company of several freehold properties in Raiwaqa, Navua. The company was in the business of commercial excavation and sale of river gravel and metal from its properties in Raiwaqa, Navua.

The Plaintiff is registered as the proprietor of 17 out of 20 (undivided) shares in the property comprised in Certificate of Title 2494 ("the Property"). The Property has an area of approximately 19 acres 1 rood and 18 perches. A copy of Certificate of Title No. 2494 is annexed and marked as "A".

The remaining three (undivided) shares in the Property are owned by the Defendants, who own a share each. This is confirmed in a letter by the Registrar of Titles dated 23 December 2008. A copy of the letter from the Registrar of Titles, dated 23 December 2008, is annexed and marked as "B".

The Plaintiff is not aware of the Defendants addresses or whether if any of them are still alive. As such, he believes that an advertisement in the "Fiji Sun" newspaper will bring this action to the notice of the Defendants or their legal representatives.

The Plaintiff wishes to acquire the Defendants minority interests in the Property at current market value. The Plaintiff and the Defendants have jointly owned the Property since on or about July 1976, some 38 years. The sale of the Defendants' interest in the Property will allow the Plaintiff to deal with the Property without any restrictions.

Accordingly, he respectfully seeks orders from this Court, for sale and transfer of the Defendants' interest in the Property to the Plaintiff, in terms of the orders sought in the Originating Summons.

The Affidavit in Opposition filed by Tom Karl Morel

[6] The matters stated in the Affidavit in Opposition deposed to by Tom Karl Morel can be detailed as follows:

1. The deponent states that he is the elder brother to Resina Nina Morel and uncle to Thomas Morel (the other two Defendants). He is authorised to make this Affidavit on behalf of the Defendants as Executor and Trustee of the Last Will of his late father, Edward Gilbert Morel (grandfather of Thomas Morel), who died on 18 November 1957. He has annexed and marked as "A" a certified true copy of the Last Will of his late father Edward Gilbert Morel. Since he is the eldest of the three Morel sibling owners of the property comprised in Certificate of Title No. 2494, the other two sibling owners have always deferred to him the decision-making as regards the management of the family interest in the said property.
2. Since all interest holders who derived their ownership from Edward Gilbert Morel are currently residing in New Zealand, he has granted a Power of Attorney to Ms. Merelea R. Vulavou, a relative from Rewa, as his Attorney, to execute any documents and or instruments on his behalf, for the duration of these proceedings. He has annexed and marked as "B" a certified copy of the said Power of Attorney.
3. He has annexed and marked as "C" a certified true copy of an extract from a report of his Land Consultant, Eroni Ratukalou, analysing the genesis of ownership and how the current Defendants came to own 3/20 share of the property comprised in Certificate of Title No. 2494.
4. On 15 June 2011, he wrote to Prince Gopal Lakshman (who has filed the Affidavit in Support of the Plaintiff Company) informing of the appointment of his cousin, the late Eroni Ratukalou, to be their land agent. In the said letter his address, telephone and mobile numbers are clearly apparent. He has annexed and marked as "D" a true copy of the said letter dated 15 June 2011.
5. Even prior to sending of the above letter, the deponent states that he has always been in constant and amicable dialogue with the said Prince Gopal Lakshman on the issue of the need to demarcate the land comprised in Certificate of Title No. 2494, so that he and the Morel family can have their separate titles over their shares of the land.
6. Since the letter dated 15 June 2011 referred to above, Eroni Ratukalou had always been in constant dialogue with the deponent and himself as regards to the demarcation of an access to the land comprised in Certificate of Title No. 2494. The said Eroni Ratukalou had passed away around 2012 – 2013.
7. On 22 September 2011, the said Prince Gopal Lakshman corresponded with him via email to explain the status of their dialogue as regards the demarcation of the land and finding appropriate access to the property. He has annexed and marked as "E" a true copy of the said email.
8. All three shareholders in the Morel family to the land comprised in Certificate of Title No. 2494, live in New Zealand. His nephew, Thomas has recently passed away. However, the children of Thomas are in contact with him regarding the property.
9. For these reasons, he finds it most puzzling that the Plaintiffs moved for substituted service of the Originating Summons and the Affidavit in Support in this case. Tom Karl Morel states that the Plaintiff has misled the Court by stating that he does not know the Defendants contacts or whereabouts and whether they are still alive or not.
10. The deponent states that he has now requested their cousin, Jim Morel and his family, to build, occupy and maintain their family presence on the property. He has also been tasked with the maintenance and upkeep of their 3/20 share in the land comprised in Certificate of Title No. 2494.
11. He adds that the Defendants forefathers form four principle Morel land owner families in Navua. Two parcels of land close to the Navua River, the land comprised in Certificate of Title No. 2495 (Navakaroko), and the land comprised in Certificate of Title No. 2494 (part of Laqeri) were owned by them. The land comprised in Certificate of Title No. 2495 has been wholly acquired by the Plaintiff. Descendants of their forefathers had also sold their interest in Certificate of Title No. 2494 to the Plaintiff. The Defendants are the only persons that had held on to and refused to sell their share to anyone because of the sentimental value of the land.
12. He submits further that the Defendants do not have any other land in Fiji and as such have plans to one day return and stay on the lands acquired by their forefathers. It is for this reason that they have given consent to Jim Morel's family to maintain presence upon the land until they could organise formal arrangements thereto.
13. The deponent states that the law relied upon by the Plaintiff is in violation of his proprietary rights protected under the Constitution and furthermore a sale as moved for by the Plaintiff is not in the interest or the benefit of the Defendants or their families.
The Affidavit in Reply filed by Prince Gopal Lakshman

[7] The Affidavit in Reply responds to the facts deposed in the Affidavit filed in Opposition and adds the following about Jim Morel.

That he is occupying the adjoining property comprised in Certificate of Title No. 2495 which is wholly owned by the Plaintiff. On 13 June 2015, he was served with a notice to vacate, dated 2 June 2015, but has refused to vacate the adjoining property.

That he has also procured a licence to extract gravel from the Department of Lands and has allowed large amounts of gravel to be illegally extracted from the Property and the Plaintiff's adjoining lot in the process.

That he has lodged a caveat against the title to the Property which had to be removed by the Plaintiff giving notice for removal.

Legal Provisions and Analysis

[8] Section 119 of the Property Law Act, which has been sub titled in action for partition, court may direct land to be sold, is set out below.

119.-(1) Where in an action for partition the party or parties interested, individually or collectively, to the extent of one moiety or upwards in the land to which the action relates requests the court to direct a sale of the land and a distribution of the proceeds, instead of a division of the land between or among the parties interested, the court shall, unless it sees good reason to the contrary, direct a sale accordingly.
(2) The court may, if it thinks fit, on the request of any party interested, and notwithstanding the dissent or disability of any other party, direct a sale in any case where it appears to the court that, by reason of the nature of the land, or of the number of the parties interested or presumptively interested therein, or of the absence or disability of any of those parties, or of any other circumstance, a sale of the land would be for the benefit of the parties interested.
(3) The court may also, if it thinks fit, on the request of any party interested, direct that the land be sold, unless the other parties interested, or some of them, undertake to purchase the share of the party requesting a sale, and, on such an undertaking being given, may direct a valuation of the share of the party requesting a sale.
(4) On directing any such sale or valuation to be made, the court may give also all necessary or proper consequential directions.
(5) Any person may maintain such action as aforesaid against any one or more of the parties interested without serving the other or others, and it shall not be competent to any defendant in the action to object for want of parties; and at the hearing of the cause the court may direct such inquiries as to the nature of the land and the persons interested therein, and other matters, as it thinks necessary or proper, with a view to an order for partition or sale being made on further considerations:
Provided that all persons who, if this Act had not been enacted, would have been necessary parties to the action shall be served with notice of the decree or order on the hearing, and, after that notice, shall be bound by the proceedings as if they had originally been parties to the action, and shall be deemed parties to the action, and all such persons may have liberty to attend the proceedings, and any such person may, within a time limited by rules of court, apply to the court to add to the decree or order.
(6) On any sale under the provisions of this section, the court may allow any of the parties interested in the land to bid at the sale, on such terms as the court deems reasonable as to non-payment of deposit, or as to setting off or accounting for the purchase money or any part thereof instead of paying the same, or as to any other matters.

[9] From a plain reading of Section 119 of the Property Law Act it is clear that what the Section contemplates is for the sale of the 'whole land' under specific circumstances and conditions. The Section does not contemplate the sale and transfer of a particular party's interests in the land, to another party, who requests for such a sale or transfer in that party's favour.

[10] If Sub Section 119(1) is to be dissected it would read as follows:

i) Where in an action for partition;
ii) the party or parties interested;
iii) individually or collectively;
iv) to the extent of one moiety or upwards in the land to which the action relates;
v) requests the court to direct a sale of the land and a distribution of the proceeds, instead of a division of the land between or among the parties interested;
vi) unless it sees good reason to the contrary;
vii) the court shall, direct a sale accordingly.

[11] It is clear from the above that where a request (an application) has been made, a court shall instead of a division of the land between or among the parties interested, direct a sale of the land and a distribution of the proceeds, unless it sees good reason to the contrary. The reference here is to the sale of the whole or entire portion of land and distribution of the proceeds amongst all parties who have shares or interests in the land.

[12] The instant case can be considered as an action for partition. In the Originating Summons the alternative relief claimed is that the Plaintiff's share in the Property and the Defendants share in the Property be partitioned. The legal definition of the term moiety is 'one half'. In this case, the Plaintiff's share in the land is more than one half. Thus the Plaintiff's share in the land is to the extent of one moiety or upwards. However, in this case, the request made is not for the court to direct a sale of the land and a distribution of the proceeds, instead of a division of the land between or among the parties interested; but for an Order for the sale and transfer of the Defendants' interests in the Property to the Plaintiff. It is the view of this Court that Sub Section 119(1) clearly does not contemplate such a sale and transfer.

[13] In the Affidavit in Opposition deposed to by Tom Karl Morel and in the submissions made by Counsel for the Defendants, reference is made to the 'good reasons to the contrary' as to why the Court should not direct a sale in terms of Section 119 in the instant case. However, it is not necessary for me to go into the merits of those reasons, since it is view of this Court that the application made by the Plaintiff is wrong in law.

[14] Similarly, if Sub Section 119(2) is to be further dissected it would read as follows:

i) The court may, if it thinks fit;
ii) on the request of any party interested; and
iii) notwithstanding the dissent or disability of any other party;
iv) direct a sale, in any case where it appears to the court that, by reason of the nature of the land, or of the number of the parties interested or presumptively interested therein, or of the absence or disability of any of those parties, or of any other circumstance;
v) a sale of the land would be for the benefit of the parties interested.

[15] It is clear from the reading of the above Subsection that where a request (an application), has been made, a Court may, if it thinks fit, direct a sale of the land and a distribution of the proceeds, if it would be for the benefit of the parties interested. The reference here too is to the sale of the whole or entire portion of land and distribution of the proceeds amongst all parties who have shares or interests in the land and not for an Order for the sale and transfer of the Defendants' interests in the Property to the Plaintiff.

[16] In any event, Court is of the opinion that, in the instant case, a sale as requested for by the Plaintiff would not be for the benefit of the Defendants in this case. It is important to reiterate that the three Defendants in this case own 3/20 share of the property comprised in Certificate of Title No. 2494. This amounts to approximately 2 acres 3 roods and 23.2 perches of land (the total extent of the land is said to be approximately 19 acres 1 rood and 18 perches).

[17] Similarly Sub Section 119(3) provides that "The court may also, if it thinks fit, on the request of any party interested, direct that the land be sold, unless the other parties interested, or some of them, undertake to purchase the share of the party requesting a sale, and, on such an undertaking being given, may direct a valuation of the share of the party requesting a sale". Even in terms of this provision the direction Court can give is for the sale of the entire portion of the land-. However, if any of the other parties interested, undertake to purchase the share of the party requesting such a sale, on such an undertaking being given, the Court may direct a valuation of the share of the party requesting a sale.

[18] Further, in terms of Sub Section 119(6) it is provided that "On any sale under the provisions of this section, the court may allow any of the parties interested in the land to bid at the sale, on such terms as the court deems reasonable..." This again reiterates the fact that the sale contemplated in this Section is in respect of the entire portion of land. However, during such a sale the court may permit any of the parties interested in the land to make a bid.

[19] Court has also examined the several case authorities referred to by Counsel for the Plaintiff in support of his case. Namely, Atu v Atu [1983] 29 FLR 100; Emma Thomas v The Estate of Eliza Miller & Tess Goulding [1996] 42 FLR 268; Wati v Nath [2013] FJHC 368; and Prasad v Kumar [2015] FJHC 165. However, the findings in the said cases can be clearly distinguished from the facts and circumstances of the present case.

[20] Taking into consideration the above factors, I am of the view, that the application made by the Plaintiff for an Order for the sale and transfers of the Defendants' interests in the Property to the Plaintiff for a sum no less than the value of the Defendants interests according to the Valuation Report, cannot be granted and accordingly should be disallowed.

[21] The application made by the Plaintiff for an Order for the sale and transfers of the Defendants' interests in the Property to the Plaintiff, is in terms of prayer (B) of the reliefs prayed for in the Originating Summons. The other reliefs prayed for [(A), (C), (D) and (E)] would have become applicable only if Court was to grant the relief prayed for in prayer (B).

[22] As an alternate remedy, the Plaintiff had sought for the Plaintiff's share in the Property and the Defendants share in the Property to be partitioned, as per prayer (F) in the Originating Summons. However, during the course of the hearing it was made clear by Counsel for the Plaintiff that what the Plaintiff was seeking was for a sale of the land and not a partition.

[23] It must be mentioned that in the Affidavit in Opposition deposed to by Tom Karl Morel and in the submissions made by Counsel for the Defendants it has been stated that the Defendants have always been in constant dialogue with the Plaintiff on the issue of the need to demarcate the land comprised in Certificate of Title No. 2494, so that they can enjoy their separate titles over their shares of the land free of any encumbrances. However, due to the position taken up by the Plaintiff during the course of the hearing Court is not in a position to intervene.

Conclusion

[24] For all the aforesaid reasons this Court is of the view that the application made by the Plaintiff should be dismissed.

[25] Accordingly, I make the following Orders:

ORDERS

The application made by the Plaintiff is dismissed.

The Plaintiff shall pay the Defendants costs summarily assessed at $1000, within one month from today.

Dated this 30th day of March 2016, at Suva.

Riyaz Hamza
JUDGE
HIGH COURT OF FIJI