HUSSAIN v. LALVANAI

022-SLLR-SLLR-1997-2-HUSSAIN-v.-LALVANAI.pdf


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HUSSAIN
v.
LALVANAI
COURT OF APPEAL.
SENANAYAKE, J. ANDEDUSSURIYA, J.
A. 396/88 (F).
C. COLOMBO 6518/RE.
JULY 31, 1996.
Rent Act, No. 7 of 1972- Reasonable requirement – Section 22(2) (b) of the Act-Whether the hardships of the Tenant should be considered.
The plaintiff-appellant instituted action on the ground that the premises arereasonably required for the purpose of the business of the plaintiff appellant interms of section 22(2) (b) of the Rent Act, No. 7 of 1972.
The District Court after trial, came to the finding that the requirements of thepremises in suit for the business of the defendant overwhelmingly outweigh thoseof the plaintiff and dismissed the action.
Held:
The Learned District Judge has taken into consideration extraneous matterssuch as difficulty of obtaining alternative accommodation and high cost ofobtaining same, the goodwill and the financial benefits which accrue to thepremises being rent controlled – all these facts are not even envisaged by section22(2) (b).
The plaintiff-appellant’s position was that she wished to continue her textilebusiness and even if one were to consider that she was contemplating a newventure, section 22 (2) (b) does not act as a barrier for all time on new ventureswhich would effectively prevent an owner of property from getting possession ofthe premises.
APPEAL from the judgment of the District Court of Colombo.
Cases referred to:
Gunasena v. Sangalingam Pillai & Co., 49 N.L.R. 473.
Hameedu Lebbe v. Adam Saibo, 48 N.L.R. 181.
A. R. M. C. Thamby Lebbe v. R Ramasamy 68 N.L.R. 356.
CA
Hussain v. Lalvanai (H. W. Senanayake, J.)
243
A. A. M. Marleen with A. R. M. Ramzeen for Appellant.
Mahes Kanagasundaram, P. C. with Asoka Abeysinghe for Respondent.
Cur. adv. vult.
July 31,1997.
W. SENANAYAKE, J.
This is an appeal from the judgment of the learned District Judgeof Colombo.
The plaintiff-appellant instituted this action against the defendant-respondent for ejectment from the premises No. 107, Main Street,Colombo 11 on the ground that the premises was required for thepurpose of the business of the plaintiff-appellant in terms of theprovisions of section 22(2) (b) of the Rent Act, No. 7 of 1972.
It was not in dispute that for the premises in question the monthlyrent exceeds Rs. 100/-.
The learned Counsel for the plaintiff-appellant contended that thelearned District Judge had failed to assess the evidence of theplaintiff. His contention was that there was evidence of the plaintiff toestablish that she was carrying on a textile business and import ofyarn (vide page 79 of the Brief) and there was evidence to indicatethat she was a Director of Maruzook & Co. Ltd., till they were ejectedfrom the premises by judicial process. The evidence was that evenafter business stopped in 1979 she had continued to import textilegiving her home address. It was her position that she financed herbusiness by obtaining Bank facilities. The Counsel contended thatthe learned District Judge had failed to consider the evidence andlaid a heavy burden on the plaintiff-appellant. At page 261 thelearned District Judge had stated “That burden of proving the natureand type of business existing for a long period is very light comparedto the burden the plaintiff had to shoulder trying to prove a businessshe alleges to carry on from her residence. It was necessary on herpart to show by certificate of registration, books of account, letterheads and or B.T.T. tax payment and by other means the fact that a
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business did in fact exist at her residence and that it is for thepurposes of that business that the premises in suit was needed. Thisburden the plaintiff has not satisfactorily discharged". I am of the viewthat the learned District Judge had laid an unfair burden on theplaintiff. He had failed to consider the provisions of 22(2) (b) of theRent Act. The essential words of the provision are "the premises arein the opinion of the Court reasonably required for… the purpose oftrade, business, profession, vocation or employment of the landlord".
It is now settled law that the need of the landlord must be urgentand genuine. The plaintiff-appellant’s need was to do business andthe learned District Judge placed a heavy burden on her to establishthat she was doing business. In the case of Gunasena v.Sangalingam Pillai & Co.m, Justice Windham in considering section 8
of the Rent Restriction Ordinance No. 60 of 1942 which contains asimilar provision to section 22(2) (b) of the Rent Act stated “thepremises are in the opinion of the Court reasonably required foroccupation as a residence for the landlord or any member of thefamily of the landlord or for the purpose of his trade, business,profession, vocation or employment”.
The word reasonableness must be construed not in the light of therequirement of the landlords own desire to occupy them however wellgrounded, genuine and even urgent without reference to how thegratifying of that requirement might directly affect or injure orinconvenience other people?. I do not think so. It is a negation ofreasonableness to take a one sided view to consider one factor onlyout of more than one, nor can any person be said to have reached areasonable decision who in reaching it ignores any effect which itmay have on his neighbour".
The Court in my view has to consider whether the requirement isreasonable. It is the Court that has to consider the additional factors.In the instant case the plaintiff-appellant was genuinely interested incarrying on the textile business. The defendant-respondent wasoccupying the premises since 1958 and doing a business and hehad been given an opportunity to find alternative accommodation.
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The defendant-respondent had not even taken the trouble to put anadvertisement in the paper (vide page 210 of the Brief) and in ‘P6’paragraph 8 the defendant-respondent had stated that it wascheaper to be a tenant. The attitude of the defendant-respondentwas one of defiance. In my view the learned District Judge had failedto analyse and consider the evidence given by the defendant-respondent. He has failed to consider the defiant attitude of thedefendant-respondent who had not tried to find out whether therewas alternative accommodation in the particular business area (videpage 208).
The opinion of the Court regarding reasonableness must beconsidered with the attending circumstances and other relevantfactors that were available before Court. It is my considered view thatthe learned District Judge had failed to consider the relevant factorsbut had emphasised on the phrase a "business in posse not in ease”.The learned District Judge at page 265 stated “it is the finding of thisCourt that the requirements of the premises in suit for the business ofthe defendant overwhelmingly outweigh those of the plaintiff”. Thelearned District Judge had taken into consideration extraneousfactors which are not contemplated by the section. He has taken intoconsideration the difficulty of obtaining alternative accommodation,and enjoying the benefits of a rent controlled premises, the high costin obtaining alternative accommodation of premises not subject tothe Rent Act. Finally he had taken into consideration that thedefendant’s business "Lalvani Brothers” was at that place for aconsiderable period and thereby had acquired the good will and thefinancial benefits which accrue due to the premises being rent-controlled.
In my view all these factors are extraneous and not evenenvisaged by section 22(2) (b) of the Rent Act. In my viewconsideration of such factors as alternative accommodation andothers statedabove by the learned District Judge is in effect read into-section 22(2)(b) as additional provisions to the section. The learnedDistrict Judge had therefore misdirected on the facts andconsequently on the law.
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In the case of Hameedu Lebbe v. Adam Saibo(2), it was held that inconsidering whether the premises are reasonably required for the useof the landlord in terms of section (c) of the Rent RestrictionOrdinance, the fact that the landlord has no business of his own andwants to earn a livelihood by commencing a business is a mattertaken into account.
The plaintiff-appellant had stated that she wished to continue hertextile business and even if one were to consider that she wascontemplating a new venture, section 22(2) (b) does not act as abarrier for all time on new ventures which would effectively prevent anowner of property from getting possession of the premises but wherethe landlord requires the premises for her business venture this mustbe considered with other factors. However because the tenant hadentrusted in that place for a long period and has build up a goodwillare in my view extraneous factors. If those factors are taken intoconsideration then a landlord will not be able to obtain any relief interms of provisions of 22(2) (b) of the Rent Act. The plaintiff has givenreasons for commencing a business on a larger scale than what shewas doing at home, where the hardship are equally that the Courtmust exercise the discretion in favour of the owner of the premises.According to the learned District Judge’s view landlord who intendsto start a business to earn his livelihood will be deprived of gettingrelief in terms of this section.
In the case of A. R. M. C. Thamby Lebbe v. R Ramasamym, G. RA. Silva held where in regard to the issue of reasonable requirement itis shown that the hardship of the landlord is equally balanced withthat of the tenant the landlord’s claim must prevail.
The critical question the learned District Judge had to decide inthis case was whether the plaintiff-appellant’s contention that sheintended to run a textile business in these premises was true, and ifso whether the premises were reasonably required by him for thepurpose of trade or business.
In arriving at this decision the learned District Judge had failed toconsider the totality of the evidence. In fact it is my view that he had
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failed to consider the evidence of the defendant. He had failed togive his mind to the defendant's evidence where he insisted andstated that he did not want a premises at Liberty Plaza or at the newcomplex at Bambalapitiya but he wanted only a place at Main Street.Even then he was not prepared to pay a high rent and advance. Thelearned District Judge had not considered the relevant evidence,thereby he had misdirected on the facts thereby committed a error inlaw by placing an undue burden on the plaintiff-appellant to establishthat her intention to carry on a business in the premises was onlyprospective and she in fact did not carry any business at the present.This is not the question that the court had to answer. The questionwas whether she had a genuine desire. If that was answered in theaffirmative the other factors are not relevant to the issue.
In the circumstances I set aside the judgment of the learnedDistrict Judge and enter judgment for the plaintiff as prayed for interms of paragraph (a) and (e) of the amended plaint. I allow theappeal with costs fixed at Rs. 3250/-.
EDUSSURIYA, J. -1 agree.