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Huang Xiaoli v Attorney General [2023] SBCA 2; SICOA-CAC 18 of 2021 (28 April 2023)

IN THE SOLOMON ISLANDS COURT OF APPEAL

JUDGMENT OF THE COURT

1. This is an appeal by the first and second appellants, Huang Xiaoli and Lau Lihwei respectively (“the Appellants”) against the orders of the Court below in which the Court granted the following orders:
   1. Rectification of the register in favour of the Claimant pursuant to Section 229(1) of the Land and Titles Act in FTEs 192-004-1631, 192-004-1629, and 192-004-1651 on the basis of fraud.
   2. No order as to rectification of register FTE in PN 192-004-1652 owned by the 5^th Defendant.
   3. All the reliefs sought under the Counterclaim are hereby dismissed.
   4. Cost of this hearing is to be paid by the 1^st and 2^nd Defendants, payable to the Claimant.
   5. Cost of the 5^th Defendant is to be paid by the Claimant.
   6. All costs is to be paid on standard basis if not agreed upon.
2. Twelve grounds of appeal have been filed by the Appellants in this appeal as set out in the Notice of Appeal filed 5 August 2021.

Brief background to this case.

3. This dispute is about the grant of a fixed-term estate in Parcel No.: 192-004-1508 (“Parcel No. 1508”) its validity, legality and subsequent subdivisions which resulted in the creation of four fixed-term estates being, parcel numbers, 192-004-1629 (“Parcel 1629”), 192-004-1631 (“Parcel 1631”), 192-004-1651 (“Parcel 1651”), and 192-004-1652 (“Parcel 1652”).
4. The original claim in the High Court (Civil Case No. 420 of 2018), was for the rectification of the register in favour of the Claimant (the Attorney-General on behalf of the Land Board and the Commissioner of Lands), pursuant to section 229(1) of the Land and Titles Act [Cap 133] of the F-TE in parcel numbers 1629, 1631, 1651 and 1652, on the basis of fraud and / or mistake. It also sought such further or other relief as the Court thinks fit.
5. The ground of fraud and or mistake arises from the existence of an allegation that the letter dated 5^th July 2014 from the Commissioner of Lands then, being the 7^th Defendant, Nestor Maelanga, informing the first and second Defendants that their application for land at Henderson was approved, was fraudulently or mistakenly backdated.
6. In support of this allegation, the Claimant (First Respondent in this appeal), relied on a reference in that letter (of 5^th July 2014), to a Land Application File Number LAPS/G/1038, which according to uncontested evidence that had been adduced, referred to a Running File kept by the Ministry of Land’s Registry Section, which showed that this file reference was only created on the 23^rd September 2015.
7. This supposedly meant that on the purported date (5^th July 2014) of the letter of approval by the Commissioner of Lands (Nestor Maelanga), there could not have been in existence any Running File with reference number LAPS/G/1038 at that period of time. The only logical explanation for this is that this was backdated to achieve the objective of having given an approval before the cut-off date of 1^st December 2014 when thereafter all approvals for land dealings including transfers needed to be approved by the Land Board.
8. The second document relied on by the Defendants in the court below, was the map that was attached to that letter. Again, the date of production of that map did not coincide with the date (5^th July 2014) of the letter. The date of production of that map was 29^th September 2015, fourteen months after. That map supposedly therefore could not have been in existence at the date when the letter of the 5^th July 2014 was written. The only logical explanation again it seems is that it must have been backdated.
9. Thirdly, the F-TE in Parcel No. 1508, was not created until 2015. The grant instrument creating that fixed-term estate was dated 7^th October 2015. This meant when the purported letter of approval was made on 5^th July 2014, the fixed-term estate in Parcel 1508 could not have been in existence. No allocation or approvals therefore could have been made in respect of that fixed-term estate under such letter. Again, the only logical explanation that could be given, is that it was backdated as claimed by the Claimant (First Respondent) on appeal.
10. It is also pertinent to note that the instructions to conduct a survey was dated 29 September 2015, which also meant that no such map could have been in existence in July 2014.

APPEAL GROUND 1. That the learned Judge erred in law and/ or fact and miscarried when he adjudge that the Fixed-Term Estates (“F-TEs) in Parcel Numbers 192-004-1629, 192-004-1631, and 192-004-1651 are rectified pursuant to Section 229(1) of the Land and Titles Act (as amended) on the basis of fraud without there being any direct or circumstantial evidence of fraud or knowledge of such fraud or causing of such fraud or substantially contributing to such fraud on the part of the Appellants.

11. This appeal ground is based on the assertion of the Appellants that there was no issue taken in regards to their earlier letter of 10^th October 2012 in which they made application to the Commissioner of Lands for “land at Henderson next to the airport”.
12. They also claim that no issue was taken in regards to the letter dated 26 October 2012 from Benedict Tova (Land Physical Planning Officer of the Guadalcanal Province) in respect of “undeveloped land (remainder of) Parcel number 192-004-1054”, which sought to identify the land being applied for.
13. They say on that premise coupled with the letter (5 July 2014), from the Commissioner of Lands (Ag), that an allocation or an offer had been validly made to the Appellants and accordingly, the Deputy Chief Justice was wrong in finding that there was fraud and or a mistake which warranted an order for rectification.
14. They say it had not been sufficiently proven on the balance of probabilities that the letter of the Commissioner was backdated, a fortiori, the letters of 10^th October 2012 and 26^th October 2012.
15. While the two letters relied on may not have been tainted, there remains a glaring discrepancy which had not been adequately accounted for when it came to the purported letter of approval from the Commissioner of Lands (Ag).
16. Those irreconcilable discrepancies have been set out in detail in paragraphs 6 – 10 in this judgment.
17. We are satisfied the learned Judge in taking those factors into account, was entitled to find and make his determination of fraud. At paragraph 48 - 50 of his judgment, he said:
    • “48. There is no scepticism as I would perceive that the 1^st and 2^nd Defendants were not aware of the activities. They knew and for that purpose advised to backdate their application.
    • 49. When it comes to the Commissioner’s letter of 5^th July 2014, the irregularity began to emerge in terms of reference to file number and the map attached. It was actually uncovering the hidden agenda of backdating to benefit the 1^st and 2^nd Defendants. They received the letter noted the date and noted the date of creation of the map. Expectedly they knew well therefore file the instruction to survey.
    • 50. This is a well-planned move orchestrated by Lands Officers to avoid allocation by the Land Board. It was well collaborated and condoned activity to assist the 1^st and 2^nd Claimants (sic). There is evidence of a number of similar back dating cases listed and attached as annexure to the sworn statement of Mr. McNeil filed on 20^th November 2020. This issue is not the first of its kind. It had been practiced in the Lands Office for years. Evidence of previous similar dealings has thrived and soon or later it will gain maturity and spread its wings.”
18. We are satisfied this appeal ground must fail.

APPEAL GROUND 2. That the learned Judge erred in law and/ or fact and miscarried when he adjudged that the Fixed-Term Estates in Parcel Numbers 192-004-1629, 192-004-1631, and 192-004-1651 are rectified pursuant to Section 229(1) of the Land and Titles Act (as amended) without considering all evidences filed on behalf of the Appellants that showed that all the said FTEs were obtained for valuable consideration within the ambits of the processes of acquiring and transferring FTEs as provided under the Land and Titles Act (as amended).

19. The claim of the First and Second Appellants under section 229 of the Land and Titles Act is that all the titles had been acquired for valuable consideration without knowledge or notice of the alleged fraud. Subsection 229(2) is the relevant section that provides as follows:
    • “(2) The land register shall not be rectified so as to affect the title of an owner who is in possession and acquired the interest for valuable consideration, unless such owner had knowledge of the omission, fraud or mistake in consequence of which the rectification is sought, or caused such omission, fraud or mistake or substantially contributed to it by his act, neglect or default.”
20. In his submissions on this point, the learned Solicitor General sought to point out that the Third, fourth and Fifth Defendants had been included in the Claim because they had purchased lots that were subdivided from FTE 1508, which the High Court had found to have been fraudulently registered. The Defendants were included as they had benefited as purchasers of lots that had been created from the mutation/subdivision of the FTE 1508. He submits that only the Fifth Defendants had filed evidence in support of its position and accordingly, rectification orders in respect of Parcel 1652 had not been sought.
21. The orders for rectification of the court below reflected that position:
    • “70. Concerning the 5^th Defendant the Claimant sought no relief against him as expressed during submissions. Simply, if there is no relief, there is no claim against him.”
22. We are satisfied this appeal ground should be dismissed on that basis.

APPEAL GROUND 3. That the learned Judge erred in law and/ or fact and misdirected himself in finding that Parcel No. 192-004-1504 was the land inspected by the Guadalcanal Provincial Planning Officer without considering evidence filed on behalf of the Appellants that showed that the remainder of Parcel No. 192-004-1054 was the land that was inspected and not Parcel No. 192-004-1504.

23. The submission by the Appellant under this ground is that the land inspected was the remainder of Fixed-Term Estate Parcel No. 192-004-1054 (“Parcel 1054”) and not Parcel No. 192-004-1504 (“Parcel 1504”).
24. The flaw however in this argument is that the map sought to be relied on did not exist at the alleged time, 26^th October 2012, when the letter was purportedly written. The date of production shown on the map was 29^th September 2015 and so that parcel of land could not have been the subject of the letter in 2012.
25. If that map is to be relied on, it is incorrect to assume that the land which was inspected was the remainder of Parcel 1054, as this parcel did not have any remainder and did not exist at that time.
26. It is also relevant to note that any references in that letter of 5^th July 2014 could not have referred to Parcel 1508 for it was also not in existence at that time. This is the irreconcilable discrepancy in that letter of allocation and purported approval by the Acting Commissioner of Lands.
27. Contrary to the claim of the Appellants that the said land was identifiable, according to the information provided by Alex Mosese (Principal Surveyor-MLHS), in his letter of 31 May 2020, at page 2, Parcel 1508 mutated from Parcel 1056 under Mutation No. 148/15. This meant it was created and superseded in 2015 from Parcel Number 192-004-1056 (“Parcel 1056”) under Survey Plans XK152582, XK152585 and XK155585. This parcel was created in 2015. It was not in existence in 2014 and so the purported approval of the Acting Commissioner of Lands could not have referred to that parcel which did not exist at that time.
28. Parcel 1054 on the other hand was created in 2009. It was one of the parcels that was created together with Parcel 1056 from Parcel Number 192-004-0059 under Mutation No. 14/09 under Survey Plan XK152582 and XK 152585.
29. The correct parcel that should be referred to accordingly in that letter^[1] of 26^th October 2012, would have been to refer to the remainder in Parcel 1056 instead of 1054. Equally, any references by the Acting Commissioner of Lands in her letter of 5^th July 2014 would have mentioned Survey Plans XK152582 and XK 152585 which related to that land. This should have been obvious to Benedict Tova, the Land and Physical Planning Officer from Guadalcanal Province and Nestor Maelanga, the Acting Commissioner of Lands. However, they made no mention of those parcel numbers and Survey Plans.
30. We dismiss this ground of appeal as having no basis.

APPEAL GROUND 4. That the learned Judge erred as a matter of law in determining fraud on the part of the Appellants without there being any specific particulars of fraud pleaded in the Claim and thereon misdirected himself in finding that the Appellants had involved in fraudulent dealings over Fixed Term Estate in Parcel Number 192-004-1058.

31. This appeal ground should be dismissed, we are satisfied adequate particulars on the allegation of fraud had been expressly pleaded in the Claim and could not be any clearer to the Appellants. The allegations of fraud stated clearly that the Appellants could not have been unaware of what was going on or taking place as the facts provided could not have led to any other conclusion, that there was knowledge, if not collusion and or that they substantially contributed to it by their act, neglect or default.

APPEAL GROUND 5. That the learned Judge erred as a matter of law and/ or fact and miscarried in failing to take into account that the fraud claimed/ alleged by the 1st Respondent related to the Fixed Term Estate in Parcel No. 192-004-1508 which no longer existed as the said parcel had mutated and was sub-divided into Parcel Numbers 192-004-1629, 192-004-1631, 192-004-1651, and 192-004-1652.

32. This appeal ground too must be dismissed as the subsequent subdivisions cannot be protected by a fraudulent transaction affecting Parcel number 1508, which was fraudulent from the outset unless it can be shown on the evidence that they were acquired for valuable consideration without knowledge and or notice of the fraudulent dealings. It would have been beneficial to the first and second appellants to have the subdivisions done as soon as possible and secure grants of fixed-term estates under those new parcels that had been secured.
33. In the case of Lazarus Estates Ltd v. Beasly^[2], Lord Denning sitting in the Court of Appeal said:
    • “No court in this land will allow a person to keep an advantage which he has obtained by fraud. No judgment of a court, no order of a Minister, can be allowed to stand if it has been obtained by fraud. Fraud unravels everything. The Court is careful not to find fraud unless it is distinctly pleaded and proved; but once it is proved it vitiates judgments, contracts and all transactions whatsoever”.
34. This is the case, that once fraud is established it must necessarily vitiate the land dealings that had been facilitated by the first and second appellants and cannot be allowed to stand unless the exceptions set out in section 229(2) can be established on evidence to the requisite standard.
35. It is immaterial that fraud was discovered later when the claim was filed in the High Court by the first Respondent on 7^th November 2018. Time starts to run from the date where fraud is discovered^[3].
36. In the case of Ama v. Sese^[4], the Court found that the “Plaintiff has shown the decision and records were fraught with errors, omissions and inconsistencies, even false entries and recordings so fundamental to the validity and legitimacy of its existence that that decision simply cannot be allowed to remain on record.” That is what the learned Judge found in this case that the glaring inconsistencies and discrepancies meant the transactions and dealings with Parcel 1508 cannot be allowed to remain on record.
37. This appeal ground too must also be dismissed.

Appeal Ground 6 was abandoned.
APPEAL GROUND 7. That the learned Judge erred as a matter of law and miscarried and thereon misdirected himself when he found that there was no Defence filed for the 3rd Respondent and the 2nd Appellant and adjudged that the said Respondent and Appellant were without a Defence to the Claim thereby rendering the trial in the proceedings in the Court below unfair and unjust.

38. This appeal ground can also be shortly disposed of. It is clear from the facts that no evidence in support of the defence was filed by the 2^nd Appellant or the 3^rd Respondent.
39. The 2^nd Defendant (2^nd Respondent) has not filed any appeal. As for the 2^nd Appellant, no evidence has been filed in support of his defence in the court below.
40. The learned Judge accordingly was entitled to find that the claim of the Claimant (1^st Respondent) was basically unchallenged in the Court below and accordingly, this appeal ground should also be dismissed.

APPEAL GROUND 8. That the learned Judge erred in law and/ or fact and miscarried when he found no claim against the 4th Respondent without considering the Claim in its entirety was made against the Appellants and the 2nd to the 8th Respondents in relation to the Fixed Term Estates in Parcel Numbers 192-004-1629, 192-004-1631, 192-004-1651, and 192-004-1652.

41. This appeal ground should be dismissed for the same reasons set out in Appeal Ground 2 and Appeal Ground 5.

APPEAL GROUND 9.

That the learned Judge erred in fact and miscarried when he found that the 1^st Appellant and the 2^nd Respondent were foreigners without there being any particular pleading and or evidence indicating the said parties’ nationalities.

42. We note this appeal ground has been abandoned.

APPEAL GROUND 10.

That the learned Judge erred in law and/ or fact and miscarried when he rectified the Fixed-Term Estates in Parcel Numbers 192-004-1629, 192-004-1631, and 192-004-1651 pursuant to Section 229(1) of the Land and Titles Act (as amended) on the basis of fraud without considering the interpretation and application of section 229(1) and 229(2) of the Land and Titles Act (as amended) as enunciated in Billy v. Daokalia [1995] SBCA 5, Aonima v. Manepora’a [2011] SBCA 24 and Maebata v. Maena [2018] SBCA 11.

43. For the same reasons set out in Appeal Grounds 2 and 5, this appeal ground should also be dismissed.

APPEAL GROUND 11.
That the learned Judge erred as a matter of law and miscarried in applying the principle of law enunciated in Lazarus Estates Ltd v. Beasly (1965) 1 QB 702; WLR 502 and thereon misdirected himself in applying the said principle of law to the circumstances of the case appealed from.
APPEAL GROUND 12.
That the learned Judge erred as a matter of law and miscarried in applying the principle of law enunciated in Lazarus Estates Ltd v. Beasly (1965) 1 QB 702; WLR 502 and thereon misdirected himself in applying the said principle of law to dismiss the Counter Claim thereby rendering the trial in the proceedings in the Court below unfair and unjust.

44. The primary Defendants in the Claim below who hatched the scheme for fraudulent backdating leading to the registration of Parcel 1508 were the First, Second, Sixth and Seventh Defendants (First Appellant, Second Respondent, Fifth and Sixth Respondents). Although the Third, Fourth and Fifth Defendants (Third Respondent, Second Appellant and Fourth Respondent) were not involved in the acquisition of Parcel 1508, they were included in the claim by the Claimant because they had purchased lots that were subdivided from Parcel 1508,which had subsequently been found to have been fraudulently registered. None of those defendants had filed any evidence in the Court below to support their positions save it seems the Fifth Defendant (Fourth Respondent). This explains the reason why no action was taken against the Fifth Defendant in the court below and no orders sought for rectification of that parcel number 1652.
45. We are satisfied the learned judge in the court below having found that fraud affected Parcel 1508 and the other three subsequent parcels 1629, 1631, and 1651, accordingly ordered rectification of the Registers therewith.
46. We are satisfied the pleadings clearly and distinctly set out the allegations of fraud in the particulars. These had been proven on the evidence before the court below. The learned Deputy Chief Justice was entitled to make the findings he did that the registrations of those parcel had been tainted by fraud and should accordingly be rectified.

Decision.

47. The appeal is dismissed, the orders of the Court below upheld with costs.

Goldsbrough (P)
Palmer (CJ)
Member
Hansen (JA)
Member

^[1] Letter of Benedict Tova (Land Physical Planning Officer of the Guadalcanal Province)
^[2] [1956] 1 QB 702; 2 WLR 502 per Lord Denning
^[3] See Sosimo v. Kwan [2018] SBCA 23; SICOA-COA of 08 of 2018, (12 October 2018).
^[4] [2006] SBHC 59; HCSI-CC 194 of 2003 (15 February 2006)