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Commissioner of Lands v Sea King Holdings Ltd [2021] SBCA 17; SICOA-CAC 27 of 2020 (30 September 2021)

IN THE SOLOMON ISLANDS COURT OF APPEAL

JUDGMENT OF THE COURT

1. The Appellants are appealing against the decision of the High Court given on 30 September, 2020, in a Category A Claim by the First Respondent in a Civil Case No. 384 of 2019, in which the primary judge ordered that the Register be rectified in favour of the First Respondent regarding the fixed term estate (FTE) in Parcel No. 191-023-190 on the ground of mistake and that the perpetual estate (PE) in Parcel No. 191-023-190 in the name of the Second Respondent be converted into FTE and be granted to the First Respondent by the First Appellant.

Background

2. The First Respondent is a company duly registered in the Solomon Islands and is the owner of Parcel No. 191-023-88, which was the site of the former Sea King Restaurant in Honiara. In May 2012, the First Respondent applied to the then Commissioner of Lands for the extension of the FTE in that Parcel. The then Commissioner of Lands agreed and granted the extension constituting Parcel No. 191 023-177 in favour of the First Respondent in return for the payment of premium and other fees. The First Respondent became registered as owner of the Parcel in May 2015.
3. In January 2019, the Second Respondent wrote to the First Respondent’s accountants and told them that Parcel No. 191-023-177 had been cancelled and had been replaced by a new Parcel No. 191-023-190 and the PE in the Parcel had been granted to him. The First Respondent was informed later about the cancellation of its title in Parcel No. 191-023-177.
4. The Second Respondent was an Acquisition Officer appointed by the Commissioner of Lands as the Commissioner's agent pursuant to s. 61 (1) of the Land and Titles Act, Chapter 133, to acquire an area of the foreshore and seabed near Honiara town, which the Commissioner of Lands wanted to purchase or lease. Instead, the second respondent using his position as Acquisition Officer acquired the Parcel for himself.

Submissions

5. The Appellants submit that the First Respondent did not have a valid title in Parcel No. 191-023-177 because the Commissioner of Lands did not own the Parcel, thus the granting of the extension of the FTE in the Parcel by the Commissioner to the First Respondent was made by mistake.
6. The Second Respondent claims legal ownership of Parcel No. 191-023-190 because he says he executed the purchase agreements with the landowners and paid SBD$300,000.00 for the Parcel. In support of these claims, the Second Respondent made a sworn statement on 30 October 2019, in which he deposed that the Parcel was lawfully acquired, and he is registered as the owner of the Parcel. He attached supporting documentary evidence to his sworn statement. The documents are marked as Exhibits JL1 to JL7. The Exhibits JL3 and JL7 affirm that the PE in the Parcel was registered under the second respondent's name.
7. The Appellants allege fraud against the Second Respondent in acquiring Parcel No. 191-023-190, they claim he abused his position as Acquisition Officer to acquire it.
8. The Appellants also submit that acquisition of Parcel No. 191-023-190 by the Second Respondent was unlawful and cannot confer a valid title because it was done in breach of the mandatory requirements under the Land and Titles Act. For example, s. 61 (1) authorized his appointment by the Commissioner of Lands as Commissioner's agent to acquire land which the Commissioner wanted to purchase or lease, not to acquire the land for himself. Under ss. 63, 64 and 65 the Second Respondent was required to publish a notice regarding the intended acquisition of the Parcel followed by a public hearing regarding the proposed acquisition and keeping records of such hearing. The Second Respondent did not comply with these requirements.

Consideration

9. It is not disputed that the First Respondent was not notified that it’s title in Parcel NO. 191-023-177 had been or would be cancelled as required under s. 228 (1) of the Land and Titles Act, until well after the creation of Parcel No. 191-023-190 in favour of the Second Respondent.
10. There is no dispute that the First Respondent went through due process under the Land and Titles Act, to acquire ownership of Parcel No. 191-023-177 for valuable consideration.
11. The only complaint against the First Respondent’s ownership of Parcel No. 191-023-177 was that the title was granted by mistake because the then Commissioner of Lands did not own the Parcel.
12. It is appropriate to note the following information provided by the Second Respondent in his sworn statement on how Parcel No. 191-023-190 was registered in his name. A letter by the Assistant Surveyor General to the Surveyor General dated 8 March 2018 advised that Parcel No. 191-023-177 was created in error under mutation 64/15 and must be cancelled. The letter advised that the ‘block plan’ would be amended as soon as advice from the Surveyor General and the Registrar of Titles were received. The letter was copied to the Registrar of Titles. In a letter dated 12 February 2018 the Registrar of Titles wrote to the Surveyor General asking the latter to confirm whether Parcel No. 191-023-177 was granted to the First Respondent by the Commissioner of Lands by mistake. In a letter dated 12 March 2018 the Surveyor General advised the Registrar of Titles that the Parcel was granted by mistake and must be cancelled. In a Minute dated 10 July 2019, the Commissioner of Lands advised the Attorney General and other relevant Government authorities that Parcel No. 191-023-190 was in the same location as Parcel No. 191-023-177 and advised that Parcel 191-023-177 had for that reason been "struck off". The Minute further advised that Parcel No. 191-023-190 had been registered in the Second Respondent's name for valuable consideration. The Commissioner denied being privy to the correspondences between the Second Respondent and the First Respondent's accountants regarding the cancellation of Parcel 191-023-177 and confirmed that Parcel 191-023-190 had been registered in Second Respondent's name.
13. The primary judge found there were two core issues for the Court to determine. First, whether the procedure to cancel Parcel No. 191-023-177 complied with the relevant requirements under the Land and Titles Act. Second, whether the Second Respondent's “acquisition” of Parcel No. 191-023-190 was lawful.
14. The primary judge found among others, that the First Respondent’s title in Parcel No. 191-023-177 was granted by mistake by the Commissioner of Lands and ordered rectification of the register in favour of the First Respondent regarding Parcel No. 191-023-190 which the primary judge found existed. The primary judge said:
    • "To put the records in order, the Commissioner of Lands had never been a party to the acquisition process, but a principle (sic.) who hired the third Defendant to perform work on his behalf. As such an appeal cannot be expected from the Commissioner of Lands. But as a principle (sic.) can decide on what is best in the situation, acknowledging the fact that the whole entire (sic.) acquisition process was invalid, according to the Crown's submissions. A dead end decision should be made there and then to finalize the end of the acquisition process.
    • The best option after some consideration is for the rectification of the register in favour of the Claimant of the FTE in Parcel No. 191-023-190 on the ground of mistake. The reason is that it is a fair approach as far as the circumstances of this case is concern (sic.). The second reason is that the above PE parcel number, on records is current. Thirdly to expose that the full acquisition process is invalid as the Council (sic.) for the Attorney General describe (sic.)". Our underlining.
15. The following Orders were made:
    • (a) That the register be rectified in favour of the Claimant of the FTE in Parcel No. 191-023-190 on the ground of mistake.
    • (b) That the PE in PN. 191-023-190 in the name of the third Defendant be converted into FTE and be granted to the Claimant by the second Defendant, the Commissioner of Lands.
16. There is only one ground of appeal:
    • 1. The Court erred in ordering the first appellant to convert the Perpetual Estate in Parcel No. 191-023-190 into Fixed Term Estate and to grant it to the First Respondent, when it also found that the acquisition of land that created PE in Parcel No. 191-023-190 did not comply with Part V of the Land and Titles Act, [Cap. 133] and was therefore not valid acquisition.
17. 17 Following orders are sought:
    1. Appeal be allowed
    2. The judgment be amended by:
       • (a) deleting the finding that the first appellant convert the PE in Parcel No. 191-023-190 to a Fixed Term Estate and to grant it to the first respondent.
       • (b) affirm that as the PE in Parcel No. 191-023-190 was created from a land acquisition process that was invalid and not complying with Part V of the Land and Titles Act {Cap 133], neither first respondent or any other party could acquire an estate over the said submerged lot.
    3. Costs

Decision

18. The cancellation of the First Respondent's title in Parcel N.191-023-177 without the first respondent being heard on the cancellation, was made in breach of s. 228 (1) and (4) (a) of the Land and Titles Act and would be unlawful.
19. The First Respondent’s title in Parcel No. 191-023-177 having been acquired for valuable consideration under s. 229 (2) of the Land and Titles Act, the First Respondent held a clear and indefeasible title. There is no evidence of the title being acquired by fraud, mistake, or omission which are grounds upon which a title may be invalidated under s. 229 (2) of the Land and Titles Act.
20. Regarding the orders by the primary judge for the rectification and conversion of the PE in Parcel No. 191-023-190 in favour of the First Respondent, we find that the primary judge fell into error because the acquisition process regarding Parcel No, 191-023-190 was not lawfully completed and the Parcel should never have been entered into the Register, if indeed it has been. If necessary, steps should be taken by the Registrar of Titles to remove it. Regarding Parcel No. 191-023-177 we find that the 'cancellation' process of the First Respondent's title was also not carried through to any conclusion. At best, it was an expression of a desire to cancel within the Lands Department that was not followed through. We also note that the Commissioner of Lands in the Minute dated 10 July 2019 to the Attorney General and other relevant Government authorities denied being a privy to correspondences between the Second Respondent and the First Respondent's accountants regarding the cancellation of Parcel No. 191-023-177. Thus, the First Respondent is in our view entitled to rectification of the Register to reflect that continuing ownership of Parcel No. 191-023-177. If the Commissioner of Lands is minded to seek the 'cancellation' of the title, that process must commence afresh. We are not inclined to agree with the stated position of the Appellants that in the case of cancellation, damages would be limited to fees etc. but cannot express more than a passing view until it is clear under which part of the Land and Titles Act the Commissioner seeks to act.
21. Consequently, we make the following orders:
    1. Rectification of the Register by removing Parcel 191-023-190 as having never come into existence.
    2. Rectification of the Register by re-instating the First Respondent as owner of Parcel No. 191-023-177.
    3. Costs of and incidental to this appeal incurred by the First Respondent be paid by the Appellants such costs to be agreed or taxed.
22. Orders accordingly.

Goldsbrough (P)
Hansen (JA)
Member
Gavara-Nanu (JA)
Member