014-NLR-NLR-V-56-D.-J.-H.-VITHARNE-Appellant-and-W.-R.-DE-ZYLVA-Respondent.pdf
FULLE J.— Vitharne o. de Zylva
67
1954Present : Pull© J. and Swan J.
1). .1. II. VLTHARNE, Appellant, and W. R. DE ZYLVA, Respondent
S. C. 411—D. C. Negombo, 15,657
Item l.'r.fl rift ion Act, Xo. 29 of 1948—Premium paid an condition of grant of tenancy—/tight of tenant to recover it—Illegal contract—Sections 8, 18, 23.
No claim can be grounded on an illegal contract. A tenant, therefore, ial>r<H-ludcd from recovering from the landlord any premium paid by him incontravention of section 8 of the Kent Restriction Act as a condition of thegrant of t he tenancy.
j^LpI’KAL from a judgment of the District Court, Negombo.
A'. E. Weerasooria, Q.C., with H. A. Koattegoda, for the defendantappellant.
A’. M. tie Silra, with E. A. G. de Silva, for the plaintiff respondent.
Cur. adv. vult.
July It), 11)54. Pi'UE J.—
The defendant who is the appellant in tliis case was the owner of pre-mises No. 316, Main Street, Negombo. On the 16th January, 1950,the defendant by an informal writing agreed to let these premises to theplaintiff at a rental of Rs. 60 a month. The third clause of the writing
stated :
58
PTJLLE J.—Viihame v. de Zylva
“ The said party of the second part has paid as an advance unto thesaid party of the first part a sum of Rs. 60 being rent due for one monththis day and the party of the first part received the same. ”
The plaintiff sued for the recovery of Rs. 1,934-10 on the basis that hopaid to the defendant at the time the informal writing was executed notthe sum of Rs. 60 but Rs. 1,500. He claimed the balance amount ofRs. 434 • 10 as damages for breach of agreement to hand over the premises.The defendant denied the receipt of any sum in excess of Rs. 60 but thelearned District Judge preferred to accept the plaintiff's evidence andgave judgment in his favour for Rs. 1,500. The claim for damages wasdisallowed.
I am unable to extract from the evidence any reasons for disturbingthe finding that the amount paid on the 16th January, 1950, was Rs. 1,500and not Rs. 60. The only question that falls to be determined is whetherthe payment was obnoxious to the provisions contained in the RentRestriction Act, No. 29 of 1948, and if so, whether the plaintiff is debarredfrom recovering the money.
The nature of the payment can be gathered from two documents.Paragraph 3 of the plaint stated :
“ On the day on which the agreement referred to in paragraph 2 of theplaint was entered into the defendant wrongfully demanded and waspaid by the plaintiff a sum of Rs. 1,500, being a sum which the defendantdemanded before he would allow the plaintiff to occupy the premisesto which the said agreement related. ”
The letter of demand sent by plaintiff’s Proctor described the amountas follows :
“ This sum of Rs. 1,500, as you are aware, was paid to y-ou by myclient as consideration for your agreeing to give him on rent the promisesowned by you. ”
In my opinion the payment i3 one which is prohibited by section 8 (b)of the Rent Restriction Act. It is a premium paid by the plaintiff asa condition of the grant of the tenancy. Both parties were, therefore,guilty of a contravention of section 8 which amounted to a criminaloffence punishable under section 23. Prima facie a court would notlend its aid to relieve a person from the consequences of criminal actscommitted by him. In regard to illegal contracts Weasels in the Lawof Contract in South Africa says at p. 217, “ It is one which the lawforbids. The law is not indifferent to it. Not only does the law refuseto enforce it, but it refuses to help a party who has been the victim orsuch a contract. No claim can be grounded on an illegal contract. Thecourt will have nothing to do with rights based directly- or indirect)vupon an illegal contract. ”
It has. been argued that this general rule should be relaxed in this casehaving regard to the class of persons the Act was intended to protect.Vide Jafferjee v. Subbiah Pillai 1. I am unable to accept this argument.The Rent Restriction Act is concerned primarily to protect a tenant who* {1953) 54 N. L. R. 505 at p. 511.
FULLE J.— Vitharne v. de Zylva
56
regularly pays the authorised rent from eviction. In regard to thepayment of premium, penalties oan be imposed equally on the giver andreceiver and it is impossible to say that the law intended to protect theprospective tenant in a special manner. The identical penalties put themin pari delicto. Certainly it would not promote public policy to allow aman to plead his own criminal act as the very foundation of his claim ina court of civil jurisdiction. To debar him from maintaining such acluim would be to uphold the will of the legislature as reflected in thepenal provisions. I do not sep how the element of coercion enters intothe transaction where the law has left the owner perfectly free to lethis house or not…
Undoubtedly tlj.e position would be different if the Act enabled therecovery of a premium in tj|»it^ of the payment thereof being a criminaloffence. Unless the plaintiff dan bring himself within section 15 of theAct, his nction must fail. This section confers the right on the tenantto recover by process of law any sum paid “ by way of rent ” wherethe sum is in excess of the authorised rent, in spite of the prohibitionimposed on the tenant against such payment by section 3 (2) and the pay-ment Iniiiig made punishable as an offence under section 23. Can itbe said that the payment of a premium as consideration for grantinga tenancy at a stipulated monthly rent is a payment “ by way of rent ” ?
T do not think so. The word “ rent ” is used in relation to the authorisedrent. If the Legislature intended that a premium, commission or grutuitycould also bo recovered it could easily have provided for it expjesslyin section . 15. I find support for the view I have expressed in tjie judg-ment of Jenkins L.J. in City Permanent Building Society v. Miller l.In this case the statutory provision which had to bo construed read asfollows :
“ Leases for any term or interest not exceeding twenty-one years,granted at a rent without taking a fine. ”
The word fine in the context included a premium. Jenkins L.J.said,
“ Surely, tho expression ‘ rent ’ in the context ‘ granted at a rontmust conuoto a periodical payment issuing out of the land during theperiod of the grant, and I should hardly have thought that a grant ofterm of three years in consideration of a lump sum, expressed to bo thewhole of the rent payable during that period would appropriately bedescribed as u loaso granted at a rent. ”
Finally it was submitted that in spite of the illegality of the paymenttho pluintiff had the right to recover because the defendant did notimplement the promise made by him to place the plaintiff in possessionof the premises. An issue was raised as to whether the defendant failedto give possession to the plaintiff. Although the learned Judge lias notanswered tliis issue I will assume it should have been answered in plaint-iff’s favour. To give effect to the argument would mean that in everycase where money has been paid in pursuance of a prohibited contract*
1 (7652) 2 All R. R. 021 at p. 628.
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Haturusiright v. Kudaduraya
it ought to be recoverable upon proof of a total failure of consideration.I am unable to accede to this argument for if I do so I would deprive t hemaxim in pari delicto potior eet conditio defendentis of its real content.
In my opinion the defendant succeeds. The decree under appealshould be set aside and plaintiff’s action dismissed. The defendant willbe entitled to draw the sum of Rs. 60 deposited in court. As the defend-ant has failed both here and below on the issues of facts there shouldbe no costs in either court.
Swan J.—I agree.
Decree set aside.