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JJ Ltd v Attorney General [2016] SBCA 5; SICOA-CAC 26 of 2014 (22 April 2016)

IN THE SOLOMON ISLANDS COURT OF APPEAL

JUDGMENT OF THE COURT

1. In 1996 the Commissioner of Lands [the Commissioner], as the holder of the perpetual estate in parcel 191-038-90 granted a fixed term estate for 50 years in the land to the second respondent, Mary Chow. It was a term of the grant that MS Chow was to erect a building on the land worth $40,000.00 within two years from the date the Commissioner signed the grant which gave her until 10 October 1998.
   
2. Ms. Chow did nothing within the two years allowed and, in fact, did nothing to comply for nine years with the result that, on 7 November 2005, the Commissioner issued a Notice before Forfeiture requiring Ms. Chow to remedy the breach by constructing a building within the following three months.
   
3. As a result, Ms. Chow lodged architectural drawings with the Honiara Town and Country Planning Board for approval. They were lodged on 13 December 2005 but Ms. Chow did not receive a decision despite further letters to the Town and Country Planning Board on 11 April and 26 May 2006 referring in both to the Notice before Forfeiture and the period specified. The result was that she was unable to construct a building within the time given in the Notice before Forfeiture.
   
4. As a consequence of that failure, the Commissioner instructed the Registrar of Titles [the Registrar] to record his re-entry and this was done by the Registrar noting the Commissioner’s re-entry on the title certificate on 15 June 2006. The Registrar followed this with a letter to Ms. Chow advising her that the Commissioner had enforced his right of re-entry and that it had been noted in the Register.
   
5. Ms. Chow then, on 23 August 2006, issued proceedings in the High Court (Civil Case no 337 of 2006) against the Commissioner, the Registrar and her brother Peter Chow although his name was later removed and his company, JJ Ltd, substituted. (It does not affect this appeal but there had been an agreement that Ms. Chow would sell the land to her brother, Peter. The sale was not completed for reasons which are not relevant and Peter Chow then applied to the Commissioner to have the fixed term estate granted to his company, JJ Ltd. The relief sought against Peter Chow was an injunction to restrain him from taking steps to acquire the title to the fixed term estate. A grant to JJ Ltd was executed on 18 August 2006 although it was not registered by the Registrar until 4 June 2010.)
   
6. The claim in 337 of 2006 was to quash the Commissioner’s decision to forfeit Ms. Chow’s title and for rectification of the register by the removal of the Commissioner’s re-entry and the restoration of Ms. Chow’s title. A further proceeding, No 262 of 2010 was commenced as an exparte application filed in July 2010 to stop Peter Chow and JJ Ltd from carrying out further work on the land.
   
7. On 16 February 2011, Chetwynd J ordered that the two cases should be consolidated and proceed as No 262 of 2010. An amended category C claim for judicial review was filed on 16 March 2011 seeking quashing orders of the Commissioner’s forfeiture of the land, of the registration of the Commissioner’s re-entry and of the Commissioner’s resumption of the land and for damages. The resumption is a reference to order for resumption sent to Mary Chow in 2010 in apparent ignorance in the Commissioner’s office of the much earlier forfeiture.
   
8. On 1 June 2011 the case again came before Chetwynd J for a rule 15.3.16 conference and in a detailed ruling on 3 August 2011, he concluded;“In all the circumstances my inclination is to allow the claimant [Ms. Chow] to proceed with her claim in respect of the forfeiture issue but to dismiss that part which relates to resumption. This would be on the basis she had no arguable case on that issue. However, in the interests of justice, it seems sensible to leave the claim intact. The parties can then first argue the issue of forfeiture. The second respondent [JJ Ltd] would be entitled to be heard on that issue because of the 2006 “grant” to it. As set out above, if the claimant successfully obtains relief from forfeiture her estate will be deemed to have subsisted and any interest the second defendant has in the land would be subject to her interests. She may then decide to continue her claim with regard to resumption but it would have to be on the basis that her claim is properly argued in that respect. If she fails then the issue of resumption does not concern her. The matter should be set down as soon as possible to deal with the sole question of forfeiture.”
   
9. On 9 August 2011, Chetwynd J gave further directions and ordered that the case be listed for hearing on 9 November 2011. It was eventually heard by Mwanesalua J on 29 July 2013. At the conclusion of the hearing, the learned judge gave an oral judgment in favour of the claimant, Ms. Chow.
   
10. The terms of his perfected judgment signed on 16 August 2013 were:

1. Grant the Claimant’s application for relief against forfeiture.

2. That a Quashing Order is granted against the action by the

Commissioner of Lands to forfeit the Claimant’s interest in the fixed term estate in parcel 191-038-90.

3. That a Quashing Order is granted against the action of the

Registrar of Titles in registering the re-entry notice of the

Commissioner of Lands as entered on the fixed term estate in parcel 191-038-90.

4. Rectification of land register to cancel the Second Defendant’s

and reinstating the Claimant as owner of the fixed term estate in parcel number 191-038-90 pursuant section 229(a) Land and Titles Act.

5. That an order for damages is granted against the First and

Second Defendants, to be assessed.

6. That an order for costs is granted against the First and Second

Defendants.

11. It is against those orders that this appeal has been filed.
    
12. On 14 August 2014, the appellant filed an application to extend time to appeal on the grounds that, although the court had advised a written judgment with reasons would be delivered, no such judgment had, by then, been supplied. The application to extend time was granted and this Court directed that the trial judge should produce written reasons for his decision.
    
13. Since that time, a written judgment, dated 29 July 2013 and stated to be by the judge, has been produced setting out the relevant issues but concluding:

“In the circumstances, the orders sought by the Claimant in this case are refused. The costs of this case are to be paid by the claimant. Order accordingly.”

14. The judgment is unsigned and we have no record of how, when or by whom it was delivered to the registry.Clearly, the judgment perfected on 16 August 2013 is the judgment properly made and the proper subject of this appeal. However, recognising the contradiction between the two documents, we enquired of counsel whether they wished to proceed with the appeal against the perfected judgment despite the lack of reasons or have the case returned to the High Court for trial de novo. Unsurprisingly in light of the delays already experienced in the proceedings, all counsel agreed that it should proceed on the present appeal papers and submissions.
    
15. The grounds of appeal are against the whole of the judgment in that the court below erred in finding in favour of the application for relief against forfeiture, in granting the quashing order against the Registrar’s registration of the notice of re-entry by the Commissioner and in ordering the rectification of the register by reinstating the claimant as owner of the fixed term estate in parcel 191-038-90. The appellant seeks declarations that the forfeiture and the re-entry notice are valid, that the appellant is the registered owner of the estate and an order that the appellant’s title to the estate is restored on the register.
    
16. The law relating to forfeiture is found in sections 136 to 139 of the Land and Titles Act. The Commissioner’s right of forfeiture is provided in section136 and, by subsection (1), he has the right to forfeit an estate if the owner fails to pay any rent incident to the estate when it falls due or to perform any obligation on his part incident to the estate.
    
17. Subsection (2) provides that the Commissioner’s right of forfeiture may, by (2)(a), be exercised by entering and remaining in possession of the land if the owner is not in occupation of the land, or may, by (2)(b), be enforced by action in the High Court.
    
18. The effect of forfeiture of an estate is to determine any lease and every other interest relating to the estate and appearing in the Register; section 137. However, in any case where the High Court grants relief against forfeiture, every such lease or other interest is deemed not to have been determined.
    
19. Before the Commissioner exercises his right of forfeiture, section 138 requires a notice before forfeiture to be served on every one who has any interest in the land specifying the breach and, if the breach is capable of remedy, a requirement that it be remedied by the owner within a specified reasonable time.
    
20. Section 139 provides the means by which the owner of an estate who has received a notice under section 138 may seek relief from the High Court and the relevant time limits of any such application.
    
21. In the present case, there is no dispute that the original grant of the fixed term estate in 1996 was subject to the construction on the land of a building for business or commercial purposes costing a minimum of $40,000.00 within 24 months.
    
22. There is no dispute that Ms. Chow did not do so within the time specified. She suggested that was the result of the ethnic unrest which affected the country. However, it is undeniable that her default continued for many years and there is no evidence of any attempt by her to remedy her failure prior to the notice of forfeiture.
    
23. There is no challenge to the fact that the Commissioner issued a notice before forfeiture which specified Ms. Chow’s breach of the terms of the grant and ended with a notice that, if its terms were not complied with fully within three months of the date of the notice, the Commissioner would exercise his right under section 136 to forfeit the fixed term estate.
    
24. Ms. Chow points out that the notice was not served on her personally and that she did not know of it until mid-November. It was dated 7 November 2005 and had been posted by registered mail. The evidence shows it was clearly known to her by 11 November 2005 because a letter was sent by her lawyer referring to the terms of the notice and of the submission of her application to the Town and Country Planning Board. In a further letter dated 6 February 2006, her lawyer advised the Commissioner that she was yet to be notified of any official decision from the Board “and so soon as our client’s application is approved she will definitely proceed with her commercial development”
    
25. The undisputed evidence shows that Ms. Chow was unable to comply within the time allowed by the notice and, on or about 15 June 2006, more than six months after the notice, on the instruction of the Commissioner; the Registrar noted the Commissioner’s re-entry on the certificate of title.
    
26. When making the grant of the fixed term estate to Ms. Chow under section 132, the Commissioner was entitled to make the transfer of title subject to performance of the obligation to construct a building within the specified time. There was clear default by the grantee over a very long period of time and a valid notice was served on the owner of the estate under section 138. The breach was remediable and she was required to remedy it. A period of time was allowed to do so but she was unable to comply so the Commissioner decided to exercise his right of forfeiture. The owner of the land in question was not in occupation and the Commissioner exercised his right to re-enter the land under section 136 (2).
    
27. A considerable volume of evidence was placed before the High Court. Much relates to matters not relevant to this appeal. The relevant facts set out in the preceding paragraphs are undisputed and unarguable. They clearly demonstrate that the correct procedure was followed by the Commissioner and his right of forfeiture was properly effected and recorded.
    
28. In the face of that, we do not understand how the trial judge could have reached the conclusion he did. On the undisputed facts, the only result must be to set the judgment made on 29 July 2013 aside in its entirety and confirm that the parcel 191-038-90 was forfeited by the Commissioner and registered accordingly in his name.
    

Order

1. Appeal allowed.

2. Judgment perfected on 16 August 2013 granting relief to the claimant in the High Court set asidein its entirety.
   
3. Declare that the right of forfeiture of the land 191-038-90 was lawfully and properly exercised by the Commissioner by re-entry and the title correctly registered in the name of the Commissioner.
   
4. Second respondent to pay the costs of the appellant in this Court and in the court below.
   

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GoldsbroughP

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Ward JA

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Hansen JA