D. E. EDIRISINGHE, Appellant and I. A. PATEL and 2 others, Respondents

025-NLR-NLR-V-79-1-D.-E.-EDIRISINGHE-Appellant-and-I.-A.-PATEL-and-2-others-Respondents.pdf


I PATHIRANA, J.—Bdirisinghe v. Patel
21?
Present: Pathirana, J., and Sirimane, J.
E. EDIRISINGHE, Appellantand
A. PATEL and 2 others, Respondents
S.C. 406/70 (F)—D. C. Colombo, 286/R.E.
Landlord and tenant—Rent-controlled premises—Action in ejectment—Repudiation of tenancy by the tenant groundlessly—Maintainabilityof action—Sub-letting—Exclusive possession of rented premises bya party other than the tenant—When is it conclusive evidence ofsub-letting—Rent Restriction Act (Cap. 274), sections 2 (4), 9, 13.
Where a tenant of rent-controlled premises denies that he is atenant when he is sued in ejectment by his landlord, such denialdoes not per se debar him from claiming the benefits of the RentRestriction Act if the Court finds that he is in fact a tenant.
Although proof by a landlord that someone other than his tenantis in exclusive possession of the rented premises would generallylead to the inference of sub-letting, no such inference of sub-lettingcan be drawn if the tenant explains satisfactorily the occupationof the premises by the third party on some footing other than asub-letting. Accordingly, where there is an agreement between thelandlord and another person that the latter is the tenant of certainpremises and a further agreement between the landlord and a thirdparty that the third party is to carry on a business in the samepremises under the name of the tenant and to pay rent, it cannotbe inferred that the tenant sub-let the premises to the third party.
Cases referred to :
Muthu Natchia v. Pathuma Natchia, 1 N.L.R. 21.
Sundra Ammal v. Jusey Appu, 36 N.L.R. 400.
Pedrick v. Mendis, 26 N.L.R. 47.
Hassan v. Nagaria, 75 N.L.R. 335.
Cassirn Hadjiar v. Umamlevve, 67 N.L.R. 22.
Chettinad Corporation Ltd., v. Gamage, 62 N.L.R. 86.
Seyed Mohamed v. Meera Pillai, 70 N.L.R. 237.
^_PPEAL from a judgement of the District Court, Colombo.
C. Ranganathan, Q.C. with D. R. P. Goonetilleke, S. Mathenthi-ran and S. Ruthiramoorthy, for the defendant-appellant.
W. Jayewardene, Q.C. with M. S. M. Nazeem, for the plain-tiffs-respondents.
Cur. adv. vult.
December 13, 1973. Pathibana, J.
The three plaintiffs-respondents, who carried on a businessunder the name of ‘ Akbarally & Company ’, sued the defendant-appellant for arrears of rent, damages and for ejectment frompremises No. 161, 4th Cross Street, Pettah, Colombo, on theground that the defendant had been in arrears of rent and hadalso sub-let the premises without the written consent of thelandlord. The premises are subject to the Rent Restriction Act.
1*—A *2319(79/06)
218
bATHlK AN A, J.—Edirieinghe v. Paid
The defendant filed answer in which he took up the positionthat he was not in arrears of rent or that he sub-let the premisesin question. He also took up the position that the landlord hadrecovered rents over and above the authorised rent, as such hewas entitled to a set off against any arrears of rent in respectof the amounts he had paid in excess of the authorised rent.In his original answer, the defendant had not denied that he wasa tenant of the premises. The plaintiffs, however, had not joinedthe sub-tenant as a party nor had they mentioned the name ofthe sub-tenant in the plaint.
The case was fixed for trial on 26.1.1965. In the meantime on19.1.1965, the plaintiffs filed petition and affidavit moving thatSockalingam Pillai, whom they alleged was the sub-tenant of thepremises be added as a party-defendant. On 26.1.1965 this applica-tion was allowed, and thereafter the defendant and SockalingamPillai filed joint answers in which they took up the positionthat the plaintiffs were fully aware that the defendant andSockalingam took the premises from the plaintiffs for and onbehalf of the 2nd defendant and that the 2nd defendant wascarrying on business in the said premises in the name of the 1stdefendant. In short, that they were both joint tenants of theplaintiffs till December 1960 when the defendant ceased to be atenant and by agreement between the plaintiffs, the defendantand Sockalingam Pillai, Sockalingam Pillai thereafter becamethe sole tenant from 1.1.1961, and carried on the business in hisown name from that date.
When the case came up for trial on 21.1.1966, objections weretaken to the procedure by which Sockalingam Pillai was addedas a party defendant and by his order of 15.12.1966 the learnedDistrict Judge held that Sockalingam Pillai was not properlyadded and his name was consequently struck off as a party. On8-5.1968, the defendant filed amended answer in which he took upthe same position as in the joint answer filed by him and Sockalin-gam, namely, that the plaintiffs were fully aware that thedefendant and the said Sockalingam Pillai took the premises fromthe plaintiffs for and on behalf of Sockalingam Pillai and that thesaid Sockalingam Pillai was carrying on business in the saidpremises in the name of the defendant; that from January, 1961,the defendant, Sockalingam Pillai and the plaintiffs came to anagreement whereby the defendant ceased to be a joint tenantin respect of the said premises as from 1.1.1961 and thatSockalingam Pillai became the sole tenant under the plaintiffsat a rental of Rs. 500 per month till 31.3.1961. ,In April 1961 therant was reduced by the plaintiffs to Rs. 400 and the saidSockalingam Pillai paid the plaintiff rent at Rs. 4001 from 1.4.1961to 31.5.1963. The defendant, therefore, denied that he was thetenant of the said premises from 1.1.1961.
NOTICE TO SUBSCRIBERS
The current Vila 1LXXIX1 when completed will tom YokeLXX1X
1 Volume LXX1X ill, will commence with cast1; Mail Ij fits SupremoCourt in M Mitt fie promulgation ot Ilia Constitution an07.09.197S.
1 Cases decided tij fie Appaliate Contis aflat the promulgation of fieConatitutioii will reportetl in volumes LXXX onwarCs.
• Valias LXXIX 'll; and LXXX will k posited simuitsneouspifithe current Volume.
} Saliscriptions for Volumes LXXIX illi and LXXX ate payable inadvance.
PATHIRANA, J.—Edirisinghe v. Patel
219
The learned District Judge rejected the contention of thedefendant that Sockalingam Pillai was the tenant of the premisesand held that it was the defendant who was the tenant of thesaid premises. He also held that the defendant had not sub-letthe premises to Sockalingam Pillai and also that the defendantwas not in arrears of rent. He, however, held that the plaintiffis entitled to eject the defendant as the defendant was not. entitled to claim the protection of the Rent Restriction Act forthe reason that the defendant had repudiated the tenancy inrespect of the premises from 1.1.1961. The reason the learnedDistrict Judge gave for coming to this conclusion was that, oncethe tenant disclaims to hold of his landlord, he is not entitledto a notice to quit. This was" the principle enunciated in theseries of cases beginning with Muthu Natchia v. Pathuma Natchia,1 N.L.R. 21 ; followed in Sundrammal v. Jusey Appu, 36 N.L.R.40; Pedrick v. Mendis, 26 N.L.R. 47 ; Hassan v. Nagaria,75 NL.R. 335, which held, that a tenant who disclaims to holdof his landlord and puts him at defiance was not entitled to havethe action dismissed for want of a valid notice to quit. Extendingthis principle he held that a tenant in respect of premisesgoverned by the Rent Restriction Act who denied tenancy wasnot entitled to the protection of the Act.
The learned District Judge also relied on Cassim Hadjiar v.Umma Levve, 67 N-L.R. 22, where L. B. de Silva, J., at page 23observes : —
“The defendants are not entitled to take up the Positionand refuse to acknowledge the transferee of their landlordas their own landlord, but in such an event the defendantsare not entitled to claim any rights of tenancy or even therights of a statutory tenant as against the plaintiff. ” I
I shall first deal with the question whether the principleenunciated in Muthu Natchia v. Pathuma Natchia can beextended to a case of a tenant who is entitled to the protectionof the Rent Restriction Act. In cases where there is the relation-ship of landlord and tenant under the common law, and wherethe Rent Restriction Act does not apply, a landlord can terminatethe tenancy and institute an action to have his tenant ejectedin a court of law. When he terminates the tenancy, there is atermination of the contract of landlord and tenant, and thelandlord comes to court alleging that his tenant is in wrongfulor unlawful occupation of the premises from the date oftermination of tenancy. Likewise, when a tenant disclaims his• contract of tenancy with his landlord and puts him at defiance,,from the point of view of his landlord his tenant is in wrongfuland unlawful occupation of the premises from that date. A
220
PATH IRAN A, J.—Edirisinghe v. Patel
termination of ’tenancy, therefore, will not be necessary, becausethe tenant disclaims tenancy. The landlord who thereafterinstitutes an action to have such a person ejected from thepremises makes an allegation in his plaint that the defendantby reason of his repudiating the tenancy, is in unlawful andwrongful occupation of the premises. The cause of action inboth these cases is that the defendant no longer occupies thepremises as tenant of the landlord, but that either by virtueof the notice of the termination of the tenancy or by a reasonof the repudiation of the tenancy, the tenant is in unlawful andwrongful occupation of the premises.
Can this principle be extended to apply to a person whoaccording to the landlord is a tenant governed by the RentRestriction Act, although such a person denies tenancy ?
Under the Rent Restriction Act the common law right of thelandlord to institute’ an action for the ejectment of the tenantof any premises to which the Act applies is fettered. He cannotinstitute any action nor will such an action be entertained by aCourt unless he obtains the written authorization of the RentControl Board. The authorization of the Board is, however, notnecessary on the grounds stated in section 13 (1) (a) (b) (c)and (d) in which cases the landlord can, however, allegingany one of the grounds set out in (a), (b) (c) and (d) ofsection 13 (1) institute an action. Likewise under section 9 (1)where a tenant without the prior consent in writing of thelandlord sub-lets the premises or any part thereof to any otherperson, the landlord can institute an action for ejectment. Arrearsof rent for a certain period is one of the grounds permitted forinstituting an action under section 13 (1). The resulting position,therefore, is that when a landlord institutes an action against atenant to have him ejected from the premises on any one ormore of the grounds set out above, in my view, once the landlordcomes to Court on the averment that the person in occupationof the premises is his tenant and establishes this fact, then sucha person cannot be ejected from the premises unless the landlordsatisfies the requirements of any one of the grounds set outin section 13 or on the ground of sub-letting under section 9 ofthe Act. A tenant may deny tenancy for a number of reasons. Hemay do so in order to avoid payment of rent. But once it is provedthat he is tenant ipso facto he is entitled to the protection ofthe Rent Restriction Act as he is a protected tenant. A reading ofsection 13 of the Act makes it also clear that the denial orrepudiation of a tenancy is not one of the grounds on which thelandlord can institute an action in Court. It may be a groundwhich he could urge before the Rent Control Board in order toobtain the authorization of the Board to institute an action.
PATHTRAJSTA, J.—Ediriainghe v. Patel
221
Section 13 (1) gives as a ground for instituting an action in Court,the case where the tenant gives notice to quit. The RentRestriction Act by virtue of section 2 (4), applies to all premises^in any area not being excepted premises. A person proved to be atenant of any such premises is entitled to the benefits, privileges*rights and immunities provided by the Rent Restriction Act.
Mr. Jayewardene also relied on the passage which I havequoted from the judgment of L. B. de Silva, J., in the case ofCassim Hadjiar v. Umma Levve. In this case the plaintiff ,atransferee from the original landlord, gave a month’s notice toquit to the defendants informing them of the execution of thedeed of gift in his favour by the defendants’ original landlord.The defendants in their reply by letter stated that they acceptedthe position that the defendants were in occupation of thepremises in question but alleged that the premises did not belongto the plaintiff. The defendants therefore, while denying theright of the plaintiff, have refused to accept the plaintiff as theirnew landlord. L. B. de Silva, J., therefore, held that thedefendants are not entitled to claim any rights of tenancy fromthe plaintiff or even to claim rights of a statutory tenant asagainst the plaintiff. However, in the concluding part of hisjudgement L. B. de Silva, J., at page 24 states : —
“ There is no provision under the common law that alandlord cannot terminate a monthly tenancy by notice ifthe tenants were not in arrears of rent, nor is there anyprovision in the Rent Restriction Act which prevents alandlord from terminating a tenancy by notice on thatground. The only provision in the Rent Restriction Actapplicable to this case was that a landlord is not entitledto sue the defendants in ejectment unless the defendantswere in arrears of rent for a period of one month after therent became due before the action was filed. In this case thedefendants have paid no rent at ail to the plaintiff and theywere in arrears of rent for a period of over one month afterthe rent became due when the plaintiff filed this action. Thedefendants were thus not entitled to the protection of theRent Restriction Act, even if they are considered to bestatutory tenants of the plaintiffs. ”
The conclusion arrived at by the learned District Judge thatdespite proof that a person is a tenant under a landlord, thedenial or repudiation of tenancy by such a person has theconsequence that he is not entitled to the protection, benefitsor rights under the Rent Restriction Act, in my view, will leadto situations never intended by the Legislature. For example,if a landlord who had been recovering rent in excess of theauthorized rent from his tenant, sues him for ejectment on the
1 •• A 42340
222
PATHIRANA, J.—Edirisinghe v. Patel
ground of arrears of rent and also for recovery of arrears of rent,if the tenant, however, chooses to deny tenancy and adducesevidence as to what the authorised rent of the premises is, doesit follow as a necessary consequence of his denial of tenancy thata Court will deprive such a person of the benefit he is entitledto under the Rent Restriction Act and recover from him rent overand above the authorised rent ? Another example comes to mymind. If a landlord who finds that his tenant has sub-let thepremises without his written consent files an action to have himejected on this ground and the tenant denies tenancy, but it isproved that he is a tenant, could it therefore be argued that thelandlord is not entitled to his right under the Rent Restriction Actto have such a person ejected if he had sub-let the premises toanother ? The absurdities that will arise from such situations aresuch that it may not be possible for a landlord to eject a tenant onthe ground of sub-letting every time the tenant denies tenancy.Asa matter of fact, the learned District Judge in the instant casehas come to the conclusion that the reason why the defendantdenied tenancy was because he probably thought he could avoidthe consequences of it being held that he had sub-let the premisesto Sockalingam Pillai. Under the Rent Restriction Act both thelandlord and the tenant have rights arising by operation of lawthe moment the relationship of landlord and tenant is established.A landlord is not entitled to say that the Act only inflicts on thetenant who denies tenancy the disabilities prescribed in the Actand that he is not entitled to the benefits of the Act.
I am, therefore, of the view that despite the denial of thetenancy by the defendant, the fact that he has been provedto be the tenant, entitles him to the protection of the RentRestriction Act. The learned District Judge has held on the twogrounds of arrears of rent and sub-letting in favour of thedefendant. In the result the plaintiffs’ action for ejectment shouldhave been dismissed.
Mr. Jayewardene, however, strenously contended that he couldsupport the judgement of the learned District Judge forejectment of the defendant from the premises on the ground thatthe evidence establishes that the defendant had sub-let thepremises to Sockalingam Pillai, and that the learned DistrictJudge had come to an erroneous conclusion both in law andon the facts in holding that there was no sub-letting of thepremises by the defendant to Sockalingam Pillai.
Before I deal with Mr. Jayewardene’s submission, I would setout the findings of fact in relation to the issue of sub-lettingby the learned District Judge. He has held that from 1958, itwas Sockalingam Pillai who was carrying on the business in.the premises in suit in the name of the defendant till 1960 and
PATHIR AN A, J.—Edirisinghe v. Patel
223
thereafter in his own name from 1961. All correspondence,telephone licences and other matters clearly showed that itwas Sockalingam Pillai who carried on the business in thesepremises. The learned District Judge was also satisfied that theplaintiffs were fully aware and acquiesced in this position, andthat it was a fact well known to the plaintiffs themselves. Thelearned District Judge has held that Sockalingam Pillai paid theplaintiffs rent at Rs. 400 per month from 1.4.1961 to 31.5.1963,which is borne out by documentary evidence and also by letterD1 sent by the plaintiffs to the defendant in the post-script ofwhich the plaintiffs stated that—
“ Our friend (meaning Sockalingam) is again in arrearsof rent and is becoming a nuisance to us. Please see thathe settles this promptly. Otherwise the best thing for you isto hand over the possession of same and avoid further trouble. ”
In the body of the letter, however, the plaintiffs informed thedefendant that he was in arrears of rent from 1.1.1963 and thatif the full settlement was not received by return, they would becompelled to take steps as advised. The learned District Judgefurther held that the defendant was at all times the tenant ofthe plaintiffs in respect of the premises in suit although Socka-lingam Pillai was to carry on the business in the premises and topay rent. There was, therefore no question of sub-letting.
Mr. Jayewardene has put forward the following arguments insupport of his contention that even on the findings of the learnedDistrict Judge, the 1st defendant has sub-let the premises toSockalingam Pillai.
His submissions may be summarised as follows : —
that although Sockalingam Pillai paid rent, he did sounder the limited capacity of an agent to pay rent;
that the plaintiffs have established sub-letting by provingthe sole and exclusive possession of the premises by SockalingamPillai to the exclusion of the defendant and in the absence ofany satisfactory explanation the presumption of sub-letting hasnot been rebutted ;
that on the facts of the case, there arises a presumptionthat Sockalingam Pillai paid rent to the defendant for hisoccupation ;
that the acquiescence on the part of the plaintiffs of theoccupation of the premises by Sockalingam Pillai was no barto the plaintiff exercising his statutory rights under Section 9of the Rent Restriction Act to have the defendant ejected fromthe premises for sub-letting the premises without the written
P ATHIR AN A, J.—Ediriaxnghe v. Patel
224
consent of the landlord. He relied for this purpose on thejudgement in Chettinad Corporation Ltd., v. Gamage, 62 N.L.R.86.
I do not propose to disturb the findings of fact upon which thelearned District Judge has based his conclusions. No doubt, inview of the inconsistent position taken up by the defendant inhis several answers, it was a difficult task for the trial Judge tofind his way to come to a determination on the facts. NeverthelessI am of the view that his findings on the facts are supported bythe evidence in this case.
Mr. Ranganathan for the appellant while trying to explain therelationship between the defendant and Sockalingam Pillai ona basis other than sub-tenancy, sought to put it under the follow-ing basis : —
A joint tenancy ; or
Agency ; or
Trustee ; or
Beneficiary
At any event he submitted that the plaintiff has failed toprove that Sockalingam Pillai was a sub-tenant of the defendant.At this stage it is relevant to quote a relevant finding of thelearned District Judge. He said “ I am satisfied on a considera-tion of the evidence, the documents, and the probabilities of thecase that the defendant was at all times the tenant of the plain-tiff in respect of the premises in suit although SockalingamPillai was to carry on the business in the premises and to payrent”. This conclusion pre-supposes the following premises : —
that there was an agreement between the plaintiff andthe defendant that the defendant was the tenant in respect ofthe premises in suit;
there was also an agreement between the plaintiff andSockalingam Pillai that Sockalingam Pillai was to carry on thebusiness in the premises and to pay rent.
The learned District Judge has found in fact that SockalingamPillai had paid the rent directly to the plaintiff from 1.4.1961 to31.5.1963. The trial Judge also gives the reason why he thoughtthat the defendant, Sockalingam Pillai and the plaintiff came tothis arrangement in respect of the premises in suit. SockalingamPillai had been carrying on business in the Pettah and hadcrashed. He owed money to two or three private individualsand also the Mercantile Bank. Sockalingam Pillai had admittedthat it was well known in the Pettah and to the plaintiffs, whoare business men in the Pettah, that he had crashed in hisbusiness. He also admitted that he could not carry on thebusiness under his own name, and that was why he carried on
PATHIRANA, J.—Edirisinghe v. PcUel
225
business under the name of the defendant. He even admittedthat the plaintiff who knew all these facts wopld not havebeen willing to let the premises to him and that was why hetook the defendant to obtain the premises.
Mr. Jayawardena relied strongly on the case of Seyed Mohamed■v. Meera Pillai, 70 N.L.R. 237, in which it was held thatwhere a person was in sole and exclusive occupation of thepremises and carried on business therein, in the absence of anyacceptable evidence to explain the occupation of such person,the only inference was that such a person was in occupation ofas a sub-tenant paying rent to the defendant. In this case be-fore me there is an explanation of the occupation of the premisesby Sockalingam Pillai because the documentary evidence in thecase and also the finding of the learned District Judge conclu-sively explain the nature of Socklingam’s occupation. In thenormal case of sub-letting, the landlord although he may beaware of the fact that his tenant has sub-let the premises toanother person, does not acquiesce in the sub-letting by acceptingrent from the sub-tenant. The unusual features in this case isthat there is a finding of the learned District Judge that theplaintiff has accepted rent from the person whom he allegesis the sub-tenant, namely, Sockalingam Pillai from 1.4.1961 to31. 5. 1963.
The argument put forward that Sockalingam Pillai was onlya limited agent for the purpose of payment of rent to theplaintiff on behalf of the defendant is untenable as it is irreconci-ble with the plaintiffs’ case that Sockalingam Pillai was in soleand exclusive occupation of the premises. There was nosatisfactory answer forthcoming from the plaintiffs as to whywithout protest tney had acquiesced in a situation wherebySockalingam Pillai was in occupation of the premises while atthe same time they accepted rent from him from 1..4.1961 to31.5.1963.
Likewise, it is not possible on the evidence in the case to drawthe inference that Sockalingam Pillai paid rent to the defendant.
I hold that whatever may be the relationship between thedefendant and Sockalingam Pillai, it is certainly not one of sub-letting by the defendant to Sockalingam Pillai. It is not necessaryfor the purpose of the decision of this case to affix a label to thisrelationship as suggested by Mr. Ranganathan, viz., thatSockalingam Pillai was a joint tenant or agent or trustee orbeneficiary. I hold that the plaintiffs have failed to prove thatSockalingam Pillai was a sub-tenant of the defendant.
I set aside the judgment and decree of the learned DistrictJudge ordering the ejectment of the defendant and others fromthe the promises in suit. The judgment and decree of the learned
226
SIRIMAJNE, J.—Ediriainghe v. Patel
District Judge in respect of arrears of rent and damages from
6.1963 less the sum of Rs. 2,000 paid as deposit, the sum ofRs. 3,765.82 pa’id by way of rates and taxes and sums paid inexcess of Rs. 218 monthly from 1.6.1960 to 31.5.1963 will not beaffected by my order.
Subject to this, the appeal is allowed and plaintiffs-respondents’action is dismissed. The defendent-appellant will be entitled to-his costs both here and below.
Sikimane, J.
I have had the advantage of reading the judgement of mybrother Pathirana, J., in which he has dealt fully with the factsand the arguments addressed to us at the hearing of this appealand am in agreement with the order proposed by him. I wishhowever to add my own observations.
The plaintiffs had come to Court seeking ejectment of thedefendant from premises, which were admittedly rent controlledwithout an authorisation from the Rent Control Board on twoground, viz., arrears of rent and sub-letting. The main groundon which learned counsel for the respondent relied to justify theorder of ejectment made against the defendant was that on theconclusions of fact arrived at by the learned trial judge theplaintiffs had in fact proved a sub-letting and the learned trialjudge therefore erred when he answered the issue on sub-lettingagainst the plaintiff. He based his argument on the fact thatthe plaintiffs had established that the defendant (in spite of hisdenial) was the tenant of the plaintiffs and that a third party,one Sockalingam, was in exclusive occupation and running hisown business in the rented premises- He submitted that this isas much as a plaintiff can prove in most cases of sub-letting asit would be almost impossible to prove an actual payment ofrent by a sub-tenant to a tenant. This is undoubtedly so and theproof by a plaintiff that someone other than his tenant is inexclusive possession of the rented premises, would in theabsence of an acceptable explanation lead to the necessary infer-ence of a sub-letting. This is what has been held in the caserelied on by learned counsel for the respondent reported in70 N.L.R. 237. It must be remembered however that the burdenof proving a sub-letting rests with the plaintiffs and that theinference of sub-letting above referred to can be drawn onlywhere there is no explanation of the third party’s possession orwhere an explanation is given which is found to be unsatisfac-tory or rejected as being false. If the defendant (as in this case)gives an explanation which is accepted by the Court as itexplains the occupation of the rented premises by a third partyon some footing other than a sub-letting, then no inference ofsub-letting can be drawn and in such circumstances it means
SIRIMAliE, J.—Edtriainghe v. Fatel
227
that the plaintiffs have failed to discharge the burden of provinga sub-letting. The learned trial judge after considering all thecircumstances accepted the explanation of Sockalingam’s occu-pation of the rented premises on a footing other than sub-lettingand came to the conclusion that “ there is, therefore, no ques-tion of sub-letting We see no adequate reason to disturb thatfinding-
The other ground on which learned counsel for the respondentrelies to justify the order of ejectment was that the defendanthaving denied the tenancy was not entitled to protection andbenefits under the Rent Restriction Act. He submitted that thedefendant having in his final answer denied that he was thetenant cannot also (as pleaded therein) claim the benefit of theRent Restriction Act. I see no reason why a defendant shouldnot be permitted to make such a plea. In such a case what thedefendant really pleads is that, quite apart from what he maysay in defence, the plaintiff is not entitled in law to the relief heclaims, or as in this case even if he is held to be the tenant (inspite of his denial) the plaintiff is still precluded by law fromobtaining the relief he claims. A defendant is always entitled toplead, in addition to any defence he may set out on the facts,that as a matter of law the plaintiff cannot in any case maintainhis action. This precisely is what the defendent has pleaded inthis case.
The plaintiffs came to Court on the allegation that the defen-dant was their tenant and he was in arrears of rent and hadsub-let the premises. The plaintiffs, in order to succeed, hadtherefore to prove—
that the defendant was their tenant,
that he was in arrears of rent and/or had sub-let the
premises to Sockalingam.
The learned trial judge answered (a) in favour of the plaintiffsand (b) against the plaintiffs both on the question of arrearsof rent and sub-letting. The plaintiffs’ action should thereforehave been dismissed but the learned trial judge made an orderfor the ejectment of the defendant and gave his reason for thisas follows : “ The defendant therefore having repudiated thetenancy as from 1.1.1961 the plaintiff is entitled to eject him andthe defendant is also not entitled to claim the protection of theRent Acts which only protect the rights of tenants He over-looked the fact that he himself had held that the defendant wasthe tenant of the plaintiff.
Since the plaintiffs came to Court without an authorisationfrom the Rent Control Board it was incumbent on them, quiteapart from what the defendant may have pleaded, to prove thatthe defendant was in arrears of rent and/or that the defendant
228
S1R1MANK, J.—Sdirisinghe v. Patel
had sub-let the premises, in terms of sections 13 (1) and 9 (1)of the Rent Act. If they failed to prove either of these grounds(as in the present case) then their action must fail in terms ofthe Rent Act itself as there being no arrears and no sub-lettingthe plaintiffs never had the right to institute an action forejectment either under section 13 (1) or 9 (1) of the Rent Act.This position remains unaffected whatever be the plea of thedefendant.
Learned counsel for the respondent cited some cases where ithas been held that a tenant who denies the tenancy is notentitled to notice to quit. The reason why such notice is notnecessary and why a defendant who denies a tenancy cannottake such a plea is because by his denial he repudiates thecontract of tenancy and thus terminates it. It is therefore notopen to the defendant, who has himself terminated the contractto say that the plaintiff has not terminated it by a valid notice.A contract of tenancy can be terminated not only by a validnotice but also by a repudiation of that contract, I do not thinktherefore that the cases cited are authority for the propositionthat a tenant who denies a tenancy is not entitled to the benefitsof the Rent Act merely on the ground that he falsely denied thetenancy. It must be stated in fairness to the defendant in thiscase that he admitted that he was a joint tenant up to a certaindate and thereafter he ceased to be that as his co-tenant becamethe sole tenant.
Once a trial judge comes to a finding on the facts the rights andliabilities of the parties must be decided in accordance with suchfinding. The fact that a defendant took up a false position in hisdefence would not alter the rights and liabilities of the partieson the true facts as found by learned trial judge. If the learnedtrial judge disapproved of the defendant’s conduct and falsedenial in this action and wanted to penalise him, he may perhapshave done so on the question of costs. The judgement howevermust be entered in accordance with the facts found by thelearned trial judge.
In the instant case therefore when the learned trial judgecame to the conclusion that the defendant was the tenant of theplaintiffs but that the plaintiffs had failed to prove either arrearsof rent or a sub-letting, he should have dismissed the plaintiffs’action. His order that the defendant should be ejected from thepremises cannot therefore be permitted to stand and must be setaside. The other orders as regards rent and payments will how-ever stand. The defendant-appellant’s appeal is allowed subjectto the above and the plaintiffs’ action is dismissed with costsboth here and below.
Appeal allowed.