I’lUhirana v. dm Silva
1978 Present: Samarakoon, C.J., Sharvananda, J.
and Ratwatte, J.
FREDDIE PATHIRANA, Defendant-Appellantand
K.M. SOMALATHA de SILVA, Plaintiff-RespondentS. C. No. 48/75 (F)—D. C. Colombo 2115/ZL
Lease—Whether letting of premises or a business—Objects sought to
be achieved—Need to look at totality of provisions in document.
Business Names Ordinance (Cap. 149), sections 2, 9—Requirementof registration of business name where not that of the person carry-ing on the business—Non-enforceability of contract for default—Whether provisions applicable.
Held: (1) That in deciding the question as to whether a documentwas a lease of a business or the letting of a premises, one has firstto look at the totality of its provisions and the object it seeks toachieve. Secondly, whether the facts established in evidence showthat, in fact, it has achieved something different and whether thedocument in question was only a cover for it.
That accordingly, in the present case, the evidence showedthat what was let was a bakery business and not the premisesitself.
That section 9 of the'Business Names Ordinance (Cap. 149)had no application to this case inasmuch as the agreement in quest-ion expressly forbade the defendant to use the business name underwhich the lessors had carried on business. Accordingly, what waslet was a business without a business name as defined by theordinance and the requirement of registration did not arise. Theagreement was therefore enforceable by action.
Cases referred to :
Charles Appuhamy v. Abeysekera, (1954) 56 N.LJl. 243 ; 52 C.L.W.
Jayasinglie v. Hussein, (1955) 56 N.L.R. 381.
Andiris Appuhamy v. Kuruppu, (1963) .65 N.L.R. 21.
-AlPPEAL from a judgment of the. District Court of Colombo.
I. G. N. de Jacolyn Seneviratne, with A. Sivagurunathan. forthe defendant-appellant.
. W. Jayewardene, Q. C., with D. R. P. Goonetllleke and MissP. Seneviratne, for the plaintiff-respondent.
Cur. adv. wilt.
!*—A 82860 (80/1.0).
SAMARAKOON, C.J.—Paihirana v. de Silva
August 7, 1978. Samarakoon, C.J.
The plaintiff in this case is the widow of one M. S. de Silva.
He died in 1966. During his lifetime he owned and ran a bakerybusiness called * Somadisi Bakery' at premises No. 64 and 66,Deans Road in Maradana. By an agreement in writing dated 18thJune, 1966, signed by the plaintiff and the defendant (producedmarked PI), the plaintiff gave the defendant “ the said premisestogether with the said bakery business and the furniture andfittings thereto belonging ” for a period of two years from 1stJune, 1966. The schedule to PI contains a detailed list of a largenumber of items of furniture and equipment used in a bakerybusiness, showing that these premises was a well-equippedbakery. Clause 1 stipulated a payment of Rs. 300 per mensem.Clause 6 stated that the defendant (described as assignee) shallnot use the name “ Somadisi Bakery ” Clause 9 stated that theassignee shall not sublet the premises. The plaintiff instituted thisaction after the two-year period lapsed as the defendant hadfailed to vacate the premises upon the expiry of the lease. Theplaintiff also alleged that the defendant had sublet the premisesto one Han'iffa contrary to “the terms of the lease. The defendantdenied all allegations and pleaded that the document PI was nota lease of a business but, in fact, a mere letting of the premises.After trial judgment was entered for the plaintiff and the defen-dant has appealed to this Court.
Counsel for the appellant contended that the plaintiff did notin fact have a business at the time PI was executed. He pointedto the provisions of clause 7 of PI which required the defendantto pay a sum of Rs. 50 per mensem to liquidate a debt due fromthe defendant and his brother who ran the business immediatelybefore PI was executed. He also pointed to the fact that thedefendant was not permitted to use the name “ SomadisiBakery ”. The document PI shows that the premises was a wellequipped bakery for baking bread and was licensed by the LocalAuthority as a bakery. The defendant admitted that he ran abakery in these premises and that all he had to do was topurchase the flour for baking bread and also engage labour tobake the bread. He had also to replace bread pans as and -whenthey perished. The document by its very terms required him tomaintain the premises and run it as a bakery. He had to observeall the regulations of the Municipality in regard to bakeries andto obtain the annualjicence required.for the bakery. He.had todo the necessary repairs and colour washing so as to conformto the by-laws of the Municipality pertaining to bakeries. Atthe. .termination of the period of 2 years he was obliged to handover the premises as a bakery with all utensils and furniture.It was therefore obligatory on him to maintain the bakery and
SAMAR AKOON, C J.—Pathirana vJi de Silva
the bakery business- He could not, therefore, have used thepremises otherwise than a bakery. In deciding the questionas to whether a document such as this is a lease of a businessor merely a letting of premises one has first to look at thetotality of its provisions and the object it seeks to achieve. VideCharles Appuhamy v. Abeysekera, 56 N.L.R. 243 and Jaya~singhe v. Hussein, 56 N.D.R. 381. Secondly, whether the factsestablished in evidence show that in fact it has achieved some-thing different and whether the document was only a cover forit. Andiris Appuhamy v. Kuruppu, 65 N.LJt. 21. The evidenceled in this case shows that what was let was a bakery business,which business the defendant ran during the period of two yearsand was stiff running at the time of the trial. I therefore rejectthe contention that PI was merely a letting of premises.
Counsel for the appellant next contended that this actionoould not be maintained by the plaintiff because the businessname had not been registered as required by the provisions ofsection 2 of the Business Names Ordinance (Cap. 149) and there-fore the agreement PI was not enforceable by action (Videsection 9 of the Ordinance). Section 2(b) reads as follows: —
“ (b) every individual having a place of business inCeylon and carrying on business under a business namewhich does not consist of his true fuff names without anyaddition shall be registered in the manner directed by thisOrdinance
Does the business which the plaintiff seeks to recover on PIhave a business name ? During the lifetime of the plaintiff’shusband the business carried the name “ Somadisi Bakery ”. Thisname did not go with the business that was leased on PI. Clause6 of Pi expressly forbids the defendant to use this name. IntJhe result what was let was a business owned by the plaintiffwithout a business name as defined by the Ordinance. It is thatbusiness which the plaintiff is seeking to recover. The provisionsof section 9 are therefore not applicable to this case and theaction is maintainable. For the abov.e reasons the appeal isdismissed with costs-
Sharvananda, J.—I agree.
It at watte, J.—I agree.
FREDDIE PATHIRANA, Defendant-Appellant and K. M. SOMALATHA de SILVA, Plainti