Bagmati v Sharuk [2020] FJHCFD 33; Family Appeal Case 7-7 Ltka of 2020 (11 December 2020)

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IN THE FAMILY DIVISION OF THE HIGH COURT APPELLATE JURISDICTION
CASE NUMBER:	7/7/2020
BETWEEN:	BAGMATI
AND:	SHARUK
Appearances:	Ms Salote Nasedra for the appellant [LAC, Suva] Ms Jowen Singh for the respondent [LAC, Lautoka]
Date/Place of judgment:	Friday, 11^th December, 2020 at Lautoka .
Coram:	Hon. Jude Nanayakkara.
Category:	All identifying information in this judgment have been anonymised or removed and pseudonyms have been used for all persons referred to. Any similarities to any persons are purely coincidental.
Anonymised Case Citation:	BAGMATI v. SHARUK - Fiji Family Appeal Case Number: 7/7/20
JUDGMENT OF THE COURT

The Learned Magistrate erred in fact and in law when excluding the matrimonial property at Wailailai Ba from the pool of assets without considering Section 166 (2) of the Family Law Act and without fully considering Section 160 (1) (2) and Section 161 (1) of the Family Law Act which prejudiced the appellant.

(05) It is not in dispute that the property comprised in Native Agreement for Lease at ‘, Ba, was part of the properties that was sought for by the appellant lady in her Form 9 filed on 20.05.2015.

(06) On the hearing of the appeal, Counsel for the appellant in arguing ground (1) submitted that there were no specific orders sought for the purpose of alienating native land or any legal or equitable interest as per Section 166 (1) of the Family Law Act and as such it was open for the court to consider subsection (2) and consider her shares in the Ba property. Counsel for the appellant further submitted that for the Learned Magistrate to completely exclude the Ba property from the pool of assets and disallowing any claim by the appellant lady to it was an error made by the Learned Magistrate.

(07) Counsel for the appellant relies substantially on the decision of Her Ladyship J. Wati in Rajeshri v Mahir^[1] in support of her proposition.

(08) In the aforementioned case, Her Ladyship J.Wati had dealt with a similar ground of appeal that was raised by the appellant wherein the Resident Magistrate had excluded certain properties claimed from the pool of assets.

The Court also did not make a finding on the value of the inalienable assets. Although there are inalienable assets, the value of the same should be worked out because in making a final distribution, the Court must have regard to the same, and if proper, make orders affecting the other property to compensate a party who does not have the benefit of the inalienable property. Even s.166(2), which is a provision on inalienable property, makes provision for how orders can be made affecting other property(s) to compensate a party. It reads:

“If a court is of the opinion that an interest in native land would have influenced or varied an order that the court would have made had it not been for subsection (1), the Court may make such order affecting other property of the parties or either of them as will compensate a party for the effect of subsection (1)”.

(10) I invited Counsel for the respondent to respond to the challenge mounted by Counsel for the appellant based on the terms of Section 166 (2) of the Family Law Act. (Ms) Singh, who appeared on behalf of the respondent, frankly admitted that the Learned Magistrate has excluded the Ba property from the pool of assets. However, Counsel argued that the failure of the Learned Magistrate to take into consideration Section 166 (2) of the Family Law Act has not prejudiced the appellant because His Worship ultimately apportioned total matrimonial property as to 70% to the appellant and 30% to the respondent. (Ms) Singh contends that “If the Ba house becomes part of pool of assets for distribution then the matter needs to go back to the Magistrate Court for rehearing on the adjustment”. Secondly, she contended that “the 70% shares then given to the appellant would not be just and equitable as there was no adjustment for future needs made for the respondent.” This is a point which seems to have escaped the Magistrate and I think that there is no explanation for that at all.

(11) I cannot accept that it would be in any way proper to entertain the second submission of (Ms) Singh, which effectively sprung on the appellant and the court at the last minute regarding the alleged failure of the Learned Magistrate to make an adjustment for future needs of the respondent, in the absence of a cross-appeal filed by the respondent, challenging the percentage decided by the Learned Magistrate for the purpose of distribution of the Matrimonial properties under the Act. I get the distinct impression that (Ms) Singh’s second argument was formulated and perhaps conceived as the appellant’s appeal proceedings developed.

(12) Counsel for the appellant properly drew the attention of the court to Section 166 of the Family Law Act. It is, first, necessary to observe what the statute says. Section 166 is in these terms.

(2) If a court is of the opinion that an interest in iTaukei land would have influenced or varied an order that the court would have made had it not been for subsection (1), the court may make such order affecting other property of the parties or either of them as will compensate a party for the effect of subsection (1).

(3) In this section “iTaukei land” has the meaning given to it by Section 2 of the iTaukei Lands Act 1905, and includes land administered or regulated under the Banaban Lands Act 1965 and the Rotuman Lands Act 1959.

The context of the section and the purpose of the Act contain nothing to suggest that the words of the section bear other than their natural and ordinary meaning.

(13) At paragraph (15) and (16), of the decision of the Learned Magistrate dated 24.10.2019, the Learned Magistrate stated;

(16) When considering the definition of matrimonial property in the interpretation section of the FLA 2003, I opine that matrimonial property refers to that owned by either or both of the parties during marriage or prior to marriage. In that regard and in light of the evidence and relevant material put before the Court and without contrary evidence, it appears that the above items mentioned by the applicant lady were acquired by the parties during their marriage. Thus, I would regard the said properties to be pool of assets with the inclusion of monies in the applicant lady’s Westpac bank account and exclusion of the property at Ba, as section 166(1) of the FLA, 2003 applies to the said property.

(14) It is, I think tolerably clear that the Resident Magistrate misunderstood the provisions of Section 166 of the Family Law Act. Not surprisingly, Section 166(2) was something which His Worship found difficulty in understanding. It is well possible that if His Worship had understood what the provisions of Section 166(2) saying, His Worship would have made an order affecting the Residential Land at, Ba(,containing 36.37 perches having single storey, partly concrete, timber and iron residential dwelling comprising three bedroom accommodation) to compensatethe appellant. Had the Magistrate considered the provisions of section 166(2) the result might well have been different.I have come to the conclusion that it is open to the appellate court to interfere with His Worship’s finding on this point. Of course, I do not deny for a moment that by virtue of Section 166(1) of the Family Law Act, His Worship is not empowered to make any order affecting the Residential Land in , Ba, (,containing 36.37 perches having single storey, partly concrete, timber and iron residential dwelling comprising three bedroom accommodation)because it is an inalienable property.

(15) I stress the words “Nothing in his Act allows a court to make an order alienating Native Lease or any legal or equitable interest in it” in Section 166(1). The language of Section 166(1) appears to me to present no difficulties of construction.

(16) The matrimonial property at , Ba,which is an inalienable property, comprised of three bedroom house which had been the family home of the appellant for several years.The land was leased to the respondent. The respondent held the land under a registered lease. It is now occupied by the respondent and his de facto wife after appellant left the house on 25-01-2014 terminating the relationship with the respondent. The respondent and his de facto wife are continuing to live on the property which had been the family house of the appellant for several years. The whole interest of the matrimonial house sitting in the Naïve Land has gone to the respondent.

(17) Turning to the evidence, the evidence was that they paid $1500.00 for the acquisition of the residentialland at Ba.Theappellants brother in New Zealand has facilitated the acquisition by contributing to the purchase price. It was the evidence of the appellant that the respondent with the assistance of some neighbours erected the house and she helped them in carrying building materials and she cooked food and made juice for them. She has contributed her labour towards the construction of the house. [Page 503 of the copy record]. The erection of the house was commenced in 1994 and was finally concluded in 2002.She gave evidence that she, as a working housewife (from 1998 to 2002) used her modest earnings towards the building of the house and considerable improvements to the house without which the house would not have been built or improved.[Page 504 of the copy record].This is sufficient for her to found an interest in the house. She could not reasonably have been expected to embark on this conduct unless she was to have an interest in the house. The law does not recognise a concept of family property, whereby people who live together in a settled relationship ipso facto share the rights of ownership in the assets acquired and used for the purposes of their life together. Nor does the law acknowledge that by the mere fact of doing work on the asset of one party to the relationship the other party will acquire a beneficial interest in that asset.

(18) The appellant was able to show that there was direct (financial) and indirect (physical labour) contribution by her towards the construction of the house and to the improvements of the house. Furthermore, she has made a very substantial contribution to the general household expenses, housekeeping and to the feeding and bringing up of the children and she has used her earning from cultivation and fishing in that way. [See, page 502 of the copy record]. I find that all this evidence is substantial enough to give the appellant an interest in the property. The appellant has acted to her detriment in reliance on the intention that she has an interest in the house and accordingly she has established an interest in the house.Thus, appellant should have an interest in the house at , Ba by virtue of her direct and indirect contribution towards the construction and improvements of the house. The law should give the appellant a share in the property proportionate to her direct and indirect contribution towards the construction of the house and improvements made to the house without which the house would not have been built or improved. The Learned Magistrate should have viewed the provisions of section 166 (2) against this factual background. It would be inequitable for the respondent to claim sole interest in the property. The Learned Magistrate should have fixed a proportion borne by her direct and indirect contribution. No such exercise is in evidence.

(19) The Learned Magistrate should have fixed a quantum for the appellant’s interest in the property by taking into her direct and indirect contribution towards the construction and improvements doneto the house. It was open to the Learned Magistrate to invoke the provisions of Section 166(2) to compensate the appellant through other matrimonial properties in the pool of assets as a consideration for the appellant’s share in the property at , Ba. No such course was exercised by the Learned Magistrate and this is detrimental to the interest of the appellant.

The Learned Magistrate erred in fact and in law when excluding the vehicle as matrimonial property when evidence had been lead during hearing on the cost of the vehicle and contribution made to the said property which prejudiced the appellant.

The Learned Magistrate erred in fact and in law when not dealing with the application for transaction to defeat claim of which evidence had been lead during hearing regarding the vehicle which prejudiced the appellant.

(20) Counsel for the appellant, in arguing ground (2) submitted that although there was no valuation of the vehicle, the court has to ensure that a clear finding of the value be made. Counsel argued that the failure of the Learned Magistrate to place an estimate on the value of the vehicle in the absence of a valuation report, demonstrated an error of law affecting the proper exercise of the judicial discretion.

(21) Reliance was placed by Counsel for the appellant on the following High Court decisions.

Counsel submitted that the Learned Magistrate made an error in exercising the discretion by failing to make a consequential order under section 169 (2) of the Family Law Act.

(23) On the other hand, Counsel for the respondent submitted that the vehicle did not form as matrimonial property because it was transferred prior to the respondent having knowledge of Form 9 application. (Ms) Singh further submitted that “the claim for the vehicle is not defeated as the respondent was not served with the Form 9 prior to the transfer. He was not aware that there was a claim in court and hence Section 169 of the Family Law Act is not applicable”.

(24) Turning first to the ground of appeal No.2, it is true that the Learned Magistrate did not make a finding as to the current market value of vehicle . The issue is whether His Worship was correct in making no finding as to the current market value of . In my view, His Worship did not fell into an error by not doing so. The parties did not present evidence on the current market value of the vehicle . The court cannot take judicial Notice of the resale value of the vehicle .

(25) I find great difficulty in understanding anything of benefit to the appellant in the two

decisions cited by Ms. Nasedra. [See paragraph 21 above.] What Her Ladyship Justice Wati said in the decision of Rajshri v Mahir (supra) was “ If there was bill of sale on any vehicle, a clear finding had to be made” . The problem here in the case before me is that no documentary evidence was put forward to enable the Magistrate to arrive at a finding as to the resale value of the vehicle. Rajshri is on a different point. It does not support Ms. Nasedra’s argument.

(26) In Manoa Sefanaia & Anor v Vishnu Deo^[2], the High Court dealt with factors considering judicial notice and stated at para 16;

“Fiji Court of Appeal in Handyhard Marketing (Fiji) Ltd vs Chand [2015] FJCA 76; ABU71.2014 (28 May 2015); set out the principle relating to judicial notice. The Court of appeal at para 71 citing Mullen’s case states:

“[71] Archbold in Criminal Pleading, Evidence and Practice, 2011. (Sweet & Maxwell) cites with approval the principle relating to judicial notice as stated in Mullen v Hackney L.B.C. [1971] 1 WLR 1103, CA (Civ. Div.) thus:

“Courts may take judicial notice of matters which are so notorious, or clearly established, or susceptible of demonstration by reference to a readily obtainable and authoritative source that evidence of their existence in unnecessary; and local courts are not merely permitted to use their local knowledge, but are to be regarded as fulfilling a constitution function if they do so.”

(27) In respect of vehicle , the parties did not produce a valuation report to the Magistrate Court to establish the current resale value. As a result, the appellant cannot now in the appeal attach to the Magistrate an obligation to fulfill the role of a counsel. Thus, there is no room for any complaint. In automobile valuation, report by an expert valuer represents the correct resale value of a vehicle. The court needs to focus on the real resale value of the vehicle to avoid loses to the parties. A valuation report is paramount in such a scenario. The court cannot take judicial notice of resale value of vehicles.

(29) Turning next to ground (3) the issue that remains to be determined in this appeal is an issue as to an allegation by the appellant lady that the respondent had transferred vehicle to a third party to defeat her claim. Counsel for the appellant urged in the forefront of her argument that the learned Magistrate failed to consider that the disposition made by the respondent fell within the ambit of a transaction to defeat the claim.

(30) On the other hand, Counsel for the respondent unequivocally intimated absence of intention on the part of the respondent to defeat the appellants’ entitlement to matrimonial property.

(31) In the current climate, it is desirable to set out Section 169 (1), (2) and (3) of the Family Law Act which is in these terms;

(a) that any money or real or personal property dealt with by any such instrument or disposition of the kind referred to in subsection (1) may be taken in execution or charged with the payment of such sums for costs or maintenance as the court directs; or

(3) The court must have regard to the interests of, and must make any order proper for the protection of, a bona fide purchaser or other person interested in an instrument or disposition of the kind referred to in subsection (1).

(4) A party or a person acting in collusion with a party may be ordered to pay the costs of any other party or of a bona fide purchaser or other person interested in and incidental to any such instrument or disposition and the setting aside or restraining of the instrument or disposition.

I stress the words “irrespective of intention” in Section 169 (1). As I understand Section 169 (2), the court is empowered to make consequential orders to give effect to Section 169 (1).

(32) Turning to the evidence adduced before the Learned Magistrate, the appellant gave evidence in the lower court that the marriage was dissolved on 08.07.2015 and on the following day the respondent transferred vehicle to his de facto wife ‘’.

(33) The transcript of the appellant’s evidence in chief contains this; (Reference is made to page 508 of the copy record)

A: No; because when I went to LTA to find it through court order so it was under defacto wifes name the vehicle had been transferred as soon as my divorce after my divorce, my divorce was on 08^th July and 9^th July he transferred the vehicle.

(35) I couple with that evidence, the evidence given by the respondent under cross-examination (Reference is made to page 583 of the copy record)

Q: My question is Mr Sharuk my client filed a property application in May of 2015 by then you had been coming to court you agree. You were aware you agreed?

Q: So, when you transferred this vehicle you were aware that there was a property application pending in this court?

(36) The evidence of the respondent for the said transfer was to give assurance to the current partner for entering in a relationship with him. In the course of the cross examination of the respondent by Counsel for the appellant, the following exchange took place;

Q: Now witness, I’ll stop you there. Applicant has stated just after the divorce was

granted your divorce was granted on 8^th of July 2015 you had transferred this vehicle onto your defacto wife ......what do you have to say about that.

A: That vehicle when I got when I used to get married. I can’t do married the legal

way so just after ....... their parents said what will the guarantee you gonna get married you give my daughter then what’s the guarantee. Then I said I got only vehicle I can just give this vehicle as a guarantee because as now after the separation could be 150%70% 80% but for that my marriage I just for assurance I just gave that van to my defacto wife.

(37) As I understand the above evidence, there was an unqualified admission by the respondent that he was aware of the appellant’s application to court for property distribution at the time he was transferring the vehicle to his current partner.

(38) The issue is this; Is this disposition made to defeat the appellant’s entitlement to the matrimonial property? The Learned Magistrate erred in law by failing to determine the issue by reference to Section 169 (1) of the Family Law Act. The Learned Magistrate has failed to come to a finding by reference to Section 169(1) . His Worship has not applied the test, that is; “whether the disposition is made to defeat an existing or anticipated order in the proceedings, irrespective of intention of the respondent? The Learned Magistrate ignored to apply the provisions of Section 169 (1) and thereby committed an error of law which is detrimental to the appellant’s entitlement to the matrimonial property. There is a clear and fundamental error of law in the proceedings of the lower court by his Worship’s failure to have regard to Section 169 (1). There is not a word about Section 169 (1) in the decision of the Learned Magistrate. Therefore, it seems to me that there is a very considerable force in ground-3. I should send the matter back to the Resident Magistrate to enable His Worship to determine the issue and make orders in light of the test by having regard to Section 169 (1).

(39) In respect of the household items, the question is who bought them? Who contributed towards the acquisition of the household items?

(20) There were certain household items as highlighted at paragraph 17 above claimed by the lady including other household items mentioned in her form 9 application for return of belongings. The sofa set according to the lady’s AOEIC was obtained from courts and the total cost being $1,173,39. The Dining table with six chairs and one big brown rug cost $481.74 (statement of account’s for the two items were enclosed in AOEIC).

(21) The lady also claimed other household items as listed in her application. However, no value has been put on the said items and no receipts were tendered by any of the parties. She had also lodged a report to police that the respondent’s current partner had been removing the said household items. I accept her evidence that when she left the matrimonial home she didn’t take any of the said items accept a few clothes, some jewelry and probably her footwear.

(41) Except the sofa set, dining table with six chairs and big brown rug, there is no scintilla of documentary evidence as to who bought the rest of the household items, who contributed towards the acquisition of the household items. There is no scintilla of documentary evidence in terms of specifies. Therefore, as regards the appellant’s case for household items, there is this absolute dilemma.

(42) However, it was open to the Learned Magistrate to make a finding towards the sofa set, dining table with six chairs and big brown rug. No such exercise is in evidence.

(3) The case record is remitted back to the Magistrate’s Court at Ba for a re-hearing on the appellant’s application for altering interests of parties in the property- property distribution.

High Court of Fiji - Family Division

Bagmati v Sharuk [2020] FJHCFD 33; Family Appeal Case 7-7 Ltka of 2020 (11 December 2020)