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JUDGMENT
BACKGROUND
[1] The Appellant, Ramdass, and the first Respondent Loki, now deceased,
were brother and sister. Loki inherited from her husband land situate at No.
19 Corentyne, Berbice, held under two transports, and on 18th April, 1984
she agreed to sell to her brother Ramdass three parcels of the said land
comprising 36 acres for the sum of $30,000.00. The said sale was evidenced
by a receipt which indicated that the purchase price had been paid in full
and that Ramdass had been put into possession.
[2] Shortly after the sale to Ramdass, Loki left Guyana for the United
States of America and remained there for approximately one year. Ramdass
having been let into possession, cultivated rice and pastured cattle on the
36 acres which he had purchased. Upon the return of Loki to Guyana, she
entered into an agreement of sale on 21st March, 1986 with Ali Mohamed, now
deceased, under which she sold for the sum of $125,000.00 all of the land
which she had inherited from her husband including the 36 acres which she
had earlier sold to Ramdass. She also agreed to give possession to Mohamed,
an arrangement which was fraught with conflict as subsequent events revealed.
[3] Ramdass continued his cultivation of the land he had purchased, and
Mohamed sought to do the same in keeping with his agreement. This resulted
in litigation when Ramdass in 1986 in action No. 444/1986 was granted an
injunction by a court restraining Mohamed from entering his portion of land.
This notwithstanding, Loki passed transport to Mohamed on 5th May, 1987.
Inevitably Ramdass upon discovery of this new development filed action No.
639/1987 against Loki, Mohamed and the Registrar of Deeds seeking specific
performance of his agreement with Loki and revocation of Mohamed's transport.
[4] Litigation between the parties continued with Loki instituting
proceedings against Mohamed in 1988 for the sum of $62,500.00, being the
unpaid balance of the purchase price which he seemed to have withheld even
after transport had been passed to him.
JUDGMENT OF THE HIGH COURT
[5] The action out of which this appeal arises (No. 639/1987) came on for
hearing, and it seems that Counsel agreed that the other actions would await
determination of this action. The Registrar of Deeds has taken no part in
these proceedings at any stage. In his pleadings Ramdass alleged that Loki
and Mohamed fraudulently passed transport to Mohamed in order "to defraud"
him of the property, but gave no particulars of the alleged fraud. A perusal
of the record indicates that at the commencement of the hearing of the
action the allegation of fraud was withdrawn by Counsel for Ramdass. This
having been done, Counsel sought to rely on Mohamed's actual notice of
Ramdass's occupation of the land and argued that Mohamed could not be said
to be a bona fide purchaser for value without notice, a claim which was
never made by Mohamed. Further, he sought to persuade the trial judge that
Ramdass had acquired an equitable interest in the land.
[6] The trial judge found on the evidence that Loki did sell three parcels
of land to Ramdass by an agreement which he held to be genuine. He also
found that by virtue of Section 23(1) of the Deeds Registry Act, Cap. 5:01
which is set out at [10] below, Mohamed had acquired full and absolute title
to the land under the transport passed to him, the allegations of fraud
having been withdrawn. Consideration was given to a range of local cases
over the years which established that equitable interests in immovable
property are not recognised in Guyana, and with which the trial judge agreed.
Based on his findings, the trial judge refused the order for specific
performance as well as the claim for a declaration that transport was
wrongfully passed to Mohamed.
JUDGMENT OF THE COURT OF APPEAL
[7] Ramdass appealed to the Court of Appeal which dismissed the appeal,
upholding the trial judge's finding that equitable interests in immovable
property are not recognised in Guyana and making reference to the Civil Law
of Guyana Act, Cap. 6:01 as well as decided cases on the subject.
[8] Following are the relevant provisions of Section 3 of the Act:
"(b) the common law of Guyana shall be the common law of England as at the
date aforesaid including therewith the doctrines of equity as then
administered or at any time hereafter administered by the courts of justice
in England, and the High Court shall administer the doctrines of equity in
the same manner as the High Court of Justice in England administers them at
the date aforesaid or at any time hereafter;
(c) the English common law of real property shall not apply to immovable
property in Guyana;
(d) there shall be as heretofore one common law for both immovable and
movable property, and all questions relating to immovable property within
Guyana and to movable property subject to the law of Guyana shall be
adjudged, determined, construed and enforced, as far as possible, according
to the principles of the common law of England applicable to personal
property:
Provided that –
(i) immovable property may be held as heretofore in full ownership, which
shall be the only ownership of immovable property recognised by the common
law and shall not be subject to any rule of succession by primogeniture or
preference of males to females, or to any other incident attached to land
tenure or to estates in lands in England and not attached to personal
property in England;
(ii) the law and practice relating to conventional mortgages or hypothecs of
movable or immovable property, and to easements, profits a prendre, or real
servitudes, and the right of opposition in the case of both transports and
mortgages, shall be the law and practice now administered in those matters
by the Supreme Court;
(iii) the relief by judgment for specific performance shall be granted in
the case of immovable property on the same principles on which it is granted
in England in the case of contracts relating to land or to interests in land."
[9] The Court also found that although Ramdass would have been entitled to
an order for specific performance against Loki, this could not be granted,
since the transport passed by Loki to Mohamed conveyed to him full and
absolute title of the land, which could only be set aside by fraud
specifically pleaded and proved, and in this case allegations of fraud had
been withdrawn by Mohamed's Counsel.
[10] Although not expressly so stated in the judgment, the Court must have
had in mind Section 23(1) of the Deeds Registry Act, Cap. 5:01 which is to
this effect:
"From and after the 1st January, 1920, every transport of immovable property
other than a judicial sale transport shall vest in the transferee the full
and absolute title to the immovable property or to the rights and interest
therein described in that transport, subject to –
(a) statutory claims;
(b) registered incumbrances;
(c) registered interests…………;
(d) registered leases……….:
Provided that any transport…….obtained by fraud shall be liable in the hands
of all parties or privies to the fraud to be declared void by the Court in
any action brought within twelve months after the discovery of the fraud……."
[11] Leave was sought and granted by the Court of Appeal to appeal to the
Caribbean Court of Justice. Before the delivery of judgment in the Court of
Appeal the first Respondent, Loki, died. The second Respondent, Mohamed,
died during the pendency of the hearing in the High Court, and had been
replaced by his son Asaf Ali Mohamed who also died. Asafs wife, Amina
Mohamed, was then appointed to represent the estate of her father-in-law,
Ali Mohamed. On an application by the Appellant, leave was granted by the
Caribbean Court of Justice for one Salim Jairam, a clerk in the office of
the attorney appearing for the Appellant, to be substituted for Loki,
deceased, for the purposes of the appeal.
[12] Before the hearing of this appeal commenced it was ascertained that
none of the Respondents was going to be represented in a case in which
important points of law were to be considered. The Court invited the Guyana
Bar Association to make available one of its members to appear as amicus
curiae. Commendably the Bar Association responded and three Counsel
including the Association's President appeared at the hearing.
ISSUES TO BE DETERMINED
[13] In summary, this appeal involves issues concerning the ongoing debate
of whether equitable interests in land in Guyana are recognised or can be
acquired, having regard to the development of the law of immovable property
in Guyana, particularly in relation to a purchaser who is put in possession
under an agreement of sale, and the effect of statutory provisions on the
indefeasibility of title to such property. If it is found that such a
purchaser acquires an equitable interest in the land purchased, a related
issue arises concerning the effect of notice (actual or constructive) of the
occupation of an earlier purchaser upon the validity of a transport passed
to a subsequent purchaser. The appeal also raises the issue as to whether,
allegations of fraud having been withdrawn at the trial of an action, they
can be raised again at the hearing of an appeal in an effort to defeat the
title acquired by a purchaser under Section 23(1) of the Deeds Registry Act,
Cap. 5:01.
SUBMISSIONS OF COUNSEL FOR THE APPELLANT
[14] Counsel for the Appellant emphasised that Section 3 of the Civil Law of
Guyana Act had incorporated in the law of Guyana the common law of England
including the doctrines of equity and that the law governing land in Guyana
though not the English law of real property, was the common law applicable
to personal property in England. In principle the only incidents attached to
tenures or estates in land in England which were outlawed in Guyana, were
those "not attached to personal property in England."
[15] Counsel submitted that the Appellant acquired an equity in the property
he purchased which ought to have been protected against any rights acquired
by the later purchaser, and in this regard he made reference to proviso (iii)
to Section 3 of the Civil Law of Guyana Act, which provides for the grant of
relief by specific performance in the case of immovable property on the same
principles on which it is granted in England.
[16] Counsel sought to persuade the Court to find that the Respondent
Mohamed's transport was obtained by fraud, and he could not be regarded as a
bona fide purchaser for value without notice as he had actual notice of the
Appellant's occupation of the land. Notwithstanding the fact that the
allegations of fraud were withdrawn before the hearing at first instance
began, Counsel submitted that this Court could still find that there was
fraud sufficient to defeat Mohamed's transport in keeping with Section 23(1)
of the Deeds Registry Act, Cap. 5:01.
DEVELOPMENT OF THE LAW OF IMMOVABLE PROPERTY
[17] The Ordinance passed in 1916 was intended to substitute the English
common law and principles of equity, along with certain English statutory
provisions for the Roman-Dutch Law, according to the Long Title of the
Ordinance. However, it was also enacted to codify certain portions of the
Roman-Dutch Law which had been until then the law governing immovable
property in the Colony of British Guiana.
[18] The said Ordinance came into effect on 1st January, 1917, and by
Section 3(2) (now Section 3(b) of the Civil Law of Guyana Act, Cap. 6:01)
the common law of the Colony became the common law of England, including
therewith the doctrines of equity as administered at the date thereof or
anytime thereafter administered by the Courts of Justice in England. It was
provided expressly that the English common law of real property was not to
apply to immovable property in Guyana (Section 3(c)), and that there was to
be as heretofore one common law for both immovable and movable property with
the proviso that immovable property may be held as heretofore in full
ownership which shall be the only ownership of immovable property recognised
by the common law (Section 3(d)). It is not without significance that in
both sub-sections the word "heretofore" is used which suggests that the
intention was to preserve both the pre-1917 position of one law for both
immovable and movable property, and the concept of full ownership of
immovable property which had been the only ownership of immovable property
recognised prior to 1917. Indeed the heading to Section 3(4)(a) of the Civil
Law of British Guiana Ordinance 1916 (which corresponds to proviso (i) of
Section 3) is "Full ownership of immovables preserved."
[19] The proviso to Section 3 of the Act specifically excludes any incidents
attached to estates in land in England and the stipulation that only full
ownership of immovable property shall be recognised suggests that all other
forms of ownership in immovable property are excluded. Dalton's commentary
on this proviso in his 1921 book "The Civil Law of British Guiana", was that
"under the English system two kinds of ownership may co-exist in the same
res, but this duplication of ownership with respect to immovable property is
not applied and Roman-Dutch law is retained".
[20] However, it must be noted that movable property can be held on trust
for beneficiaries e.g. those who have equitable co-ownership interests, life
interests, interests in remainder or interests under discretionary trusts
that bind an insolvent trustee's creditors under Section 42 of the
Insolvency Act, Cap. 12.21, and are capable of binding third parties.
[21] Debate has raged over the years on whether equitable interests in land
are recognised in Guyana, and the case law on the subject indicates the
conflict of opinions on the interpretation of Section 3 of the Civil Law of
Guyana Act, which has created uncertainty and imprecision. In this regard we
endorse the view of a writer on the subject, David de Caires, in a paper
entitled "A Problem in Immovable Property in Guyana - The Application of
Roman Dutch Law" that in attempting to effect change from one system to
another "it would have been infinitely superior if our own land law had been
drafted if the English system had been considered undesirable". In his
opinion the introduction of the English law of personal property and the
continued engrafting of English concepts was anomalous and unsatisfactory.
[22] The majority view reflected in cases within the distant and recent past
indicates an acceptance of the conclusion that equitable interests in land
are not recognised in Guyana (see Mangia -v - Safayan and others[FN1],
Gangadia -v- Barracot[FN2], Dias -v- Cornett[FN3], Kitty and Alexanderville
Village Council -v- Vieira[FN4], Fazal -v- Annamanthadoo,[FN5] and more
recently the unreported case of Dropattie Singh -v- RaymondBayne.[FN6] As
expected there were several which held differently, some in the early years
after enactment of the Civil Law of Guyana Act, particularly where the
possibility of creating equitable trusts was in question. Indeed Section 10
provides that the Trustee Act 1893 of the United Kingdom was to be part of
the law of Guyana. (See Sooknanan -v- Sunichery[FN7], Obermuller -v-
Obermuller[FN8], Coltress -v- Coltress[FN9], and Joseph -v- Joseph[FN10].
Others include British Colonial Film Exchange Ltd -v- S.S. de Freitas[FN11],
Ishriprasad -v- Jaikaran[FN12], and Seeram Singh -v- Dariau Singh[FN13]).
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[FN1] (1917) LRBG 58-60
[FN2] (1919)LRBG 216
[FN3] (1960)LRBG 215
[FN4] (1961) LRBG 88
[FN5] (1991) 48 WIR 150
[FN6] (C.A. No. 61 of 1991)
[FN7] (1942) LRGB 260
[FN8] (1927) LRBG 71
[FN9] (1931-7) LRBG 523
[FN10] (1960) LRBG 392
[FN11] (1938) LRBG 33
[FN12] (1951) LRBG 86
[FN13] (1955) LRBG 62
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[23] The Civil Law of Guyana Act in 1917 having expressly enacted that full
ownership was to be the only ownership of immovable property recognised in
Guyana, the Deeds Registry Act passed in 1920 placed this beyond doubt and
went even further when Section 23(1) provided that every transport of
immovable property vests in the transferee full and absolute title to
immovable property, subject only to certain claims, encumbrances and
interests mentioned therein.
[24] The success of the Appellant's claim rests on a finding that he
acquired an equitable or some other interest in the land which he occupied
under the agreement of sale entered into between himself and Loki, and such
interest has priority over the full and indefeasible title acquired under
Mohamed's transport. In somewhat similar, though not identical,
circumstances the Court of Appeal of Jamaica in Phillips -v- Bisnott[FN14]
held that a plaintiff who had been let into possession of a portion of land
under a verbal agreement of sale with a vendor who later conveyed title to
him, but who before doing so had conveyed the title to a subsequent
purchaser, had acquired an equitable interest in the land. Thus when the
vendor had conveyed title to the subsequent purchaser the vendor had only a
bare legal estate, and the purchaser, the defendant, took this legal estate
subject to the plaintiff's equitable interest of which from the evidence she
had notice.
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[FN14] (1965) 8 WIR 229
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[25] This case, in a jurisdiction without any Roman-Dutch influence, stands
in sharp contrast to decided cases in Guyana on the type of interest which a
purchaser acquires under an agreement of sale when let into possession
before title is conveyed to him. Even among the Guyanese cases opinions
differ. In Udit -v- Macouba Cooperative Land Society Ltd.,[FN15] Rennie, J.
queried whether the interest of a purchaser let into possession is that of a
tenant at will, although conceding that a tenancy at will would arise in
circumstances where the purchaser had paid a portion of the purchase price
and been let into possession, as this is the best means of expressing the
intention of the parties. Incidentally the Landlord and Tenant Act, Cap.
61:01 defines a tenancy at will as "a holding of land or buildings under a
contract for the exclusive possession thereof to hold at the will of the
landlord". In an earlier decision in Mangia -v- Safayan (supra) Sir Charles
Major C.J. held that a purchaser of immovable property who had partly paid
for it, but had no legal transfer, had only a jus incorporale, which is the
jus ad rem, i.e. the contractual right to demand and obtain transfer from
the sellers.
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[FN15] (1961) 3 WIR 244
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[26] The Court of Appeal in Sarabjeet Ramlakhan -v- Boodnie Farouk[FN16]
followed Verity, J. in Gondchi -v- Hurrill,[FN17] and reasoned that where a
purchaser entered into possession of land in pursuance of an agreement of
sale, title to which is to be conveyed at a subsequent date, he acquired an
interest on the basis of his possession.
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[FN16] (1974) 21 WIR 224
[FN17] (1931-7) LRBG 509
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[27] As stated earlier and now re-emphasised, dicta from a formidable array
of cases of older as well as more recent vintage lead to the inevitable
conclusion that equitable interests in immovable property are not recognised
and cannot be acquired in Guyana. Accordingly the Appellant acquired no
equitable interest in the land purchased from Loki. He, however, was
entitled to seek from Loki an order for specific performance of the
agreement of sale under proviso (iii) to Section 3 of the Civil Law of
Guyana Act, but only, if title to the land had remained vested in her. A
distinction must be made between acquiring an equitable interest in
immovable property and seeking equitable relief on the same principles on
which it is granted in England.
[28] The Appellant, in fact, did seek an order for specific performance
against Loki, but only after she had passed transport to Mohamed, who, by
virtue of Section 23(1) of the Deeds Registry Act, acquired an indefeasible
title subject only to a possibility of it being declared void for fraud. An
attempt by the Appellant to rely on fraud was abandoned at the hearing of
the action in the lower court.
[29] His Counsel sought to persuade this Court that despite the withdrawal
of the allegations of fraud Mohamed's notice of Ramdass's occupation of the
land and knowledge of his earlier purchase could constitute collusion with
Loki to deprive him of title. The evidence led at the trial revealed no
conspiracy between Loki and Mohamed, only knowledge by Mohamed of his (Ramdass's)
occupation.
[30] The issue of fraud raised in Section 23(1) of the Deeds Registry Act
was discussed by George, J. in Allicock -v- Demerara Bauxite Co. Ltd.[FN18]
In Waimiha Sawmilling Co Ltd -v- Waione Timber Co. Ltd[FN19], the Judicial
Committee of the Privy Council expressed the view that fraud clearly implies
some act of dishonesty, and dishonesty must not be assumed solely by reason
of knowledge of an unregistered interest; in fact in that case the relevant
statute governing transfer of land expressly provided that knowledge of an
unregistered interest should not be imputed as fraud.
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[FN18] (1968) LRG 140
[FN19] [1926] AC 101
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[31] On the issue of constructive notice by Mohamed of the Appellant's
interest in the land in question, Counsel who appeared as amici curiae drew
the Court's attention to the fact that although every transport vests in the
transferee full and absolute title to immovable property, this is subject to
certain claims and registered interests as enumerated in Section 23(1) of
the Deeds Registry Act and set out at [10] above. In this regard reference
was made to the case of Fazal -v- Annamanthadoo (supra) where two agreements
of sale to a third party had been registered at the Deeds Registry before an
agreement had been entered into with a subsequent purchaser. The Court of
Appeal held that the two agreements of sale did not fall within the term "registered
interests" defined in Section 2 of the Deeds Registry Act as being "all
liabilities, rights, interests, and special conditions, imposed or attached
to immovable property by agreement or otherwise which have been registered".
Contracts of purchase and sale do not fall within this definition, and hence
do not affect the title of a purchaser to whom transport is passed. Earlier
in a related issue in Dhanpaul -v- Demerara Bauxite Co. Ltd.[FN20] the Court
was called upon to determine whether an oral agreement of tenancy for land
which was never registered under the Deeds Registry Ordinance was binding on
purchasers to whom transport of the property had been passed. Luckhoo, J.
held that the purchasers took free of the tenancy on the ground that unless
reserved by the conveyance itself, interests in immovable property which are
required to be registered, if not registered are void against a purchaser
even if he has actual notice of those interests. Similar English statutory
provisions have the same effect on unregistered interests in immovable
property. (See Lloyds Bank plc - v- Carrick and Another[FN21] and Midland
Bank Trust Co. Ltd. and Another -v- Green[FN22]).
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[FN20] (1959) 1 WIR 257
[FN21] [1996] 4 ALL ER 630
[FN22] [1981] A.C. 513
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[32] The Appellant's agreement with Loki was not registered in the Deeds
Registry and even if it were it could not have been regarded as a registered
interest as defined in the Deeds Registry Act, so as to bind transferees as
a proprietary interest.
[33] In light of the foregoing views expressed and cases referred to earlier,
it is reiterated that the Appellant acquired no equitable interest in the
land which he purchased from Loki and of which he was let into possession
under the agreement of sale. He merely had the right to sue for specific
performance (a "jus in personam ad rem") before title was conveyed to
Mohamed. The Appellant not having so sued, Mohammed obtained an indefeasible
title which could only have been declared void by a Court upon proof of
fraud. Allegations of fraud having been withdrawn at the hearing of the
action at first instance the Appellant could not rely solely on Mohamed's
knowledge of his occupation to defeat the indefeasible title acquired under
the transport. The Appellant's sole remedy may have been an action against
the estate of Loki to recover the purchase price paid and possibly damages,
but such an action would presumably have been time- barred several years
earlier.
[34] In the circumstances the appeal is dismissed. No order for costs is
made as none of the Respondents took any part in the appeal, and the order
for costs made by the Court below in relation to the Registrar of Deeds who
took no part in those proceedings, is hereby vacated.
[35] This Court wishes to express its gratitude to those attorneys who
appeared as amici curiae for the assistance which was so generously given. |
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