101-NLR-NLR-V-44-JASOHAMY-et-al.-Appellants-and-PODIHAMY-et-al.-Respondents.pdf
Jasohamy and Podihamy.
385
1943Present: Moseley S.P.J. and Keuneman J.
JASOHAMY et al., Appellants, and PODIHAMY et al.,Respondents.
274—D. C. Tangalla, 4737.
Usufructuary—Right to compensation—Conveyance of right—Partition action.A usufructuary, who has made improvements with the consent andacquiescence of the owner, is entitled to compensation.
Where the improvement is conveyed by deed, together with all theright, title, and interest in the property, the right to claim compensationis also conveyed. A claim to compensation .may be asserted in apartition action.
T
HIS was a partition action in respect of a land, which belongedto one M. G. Babunappu, who transferred it on May 30, 1913, to his
live children including the first defendant, but reserved the life-interestto himself. Shortly afterwards Babunappu erected a distillery onthe land which he possessed during his life-time and which he by deed1 D 2 of January 24 sold to the first defendant, who was in exclusivepossession of it till the death of Babunappu in 1941.
The learned District Judge held that the first defendant did not obtaintitle by virtue of 1 D 2 to the distillery which was vested in the fivechildren of Babunappu. He further held that Babunappu had a claimfor compensation in respect of the distillery and that by the deed 1 D 2this right to compensation was conveyed to the first defendant.
H. V. Perera, K.C. (with him E. B. Wikremanayake), for the plaintiffs,appellants.—It cannot be said that any right to claim compensation wasconveyed to the first defendant by deed 1 D 2. What was conveyedby that deed was the improvement itself, i.e., the distillery. The caseof Mohamad Bhai et al. v. Silva et al.1 which the District Judge has referredto, dealt with the rights of a purchaser of land, and is not applicablein the present case. Deed 1 D 2 conveyed the building alone and notthe land on which the building stood.
The vendor in 1 D 2 was only a usufructuary. A usufructuary cannotclaim compensation in respect of improvements made by him. Thisquestion was exhaustively examined by Kotze J. in Brundson’s Estate v.Brundson’s Estate et al." and it was held that a usufructuary is, in theabsence of special circumstances, not entitled to claim compensation forimprovements. See also Wait v. Estate Wait3. A usufructuary isfully aware of the nature of his possession and is not in the same positionin law as that of a bona fide pb'ssessor-. See Wille on Principles of S.African Law, p. 353 (1937 ed.). It has been held that a purchaser from afiduciary heir cannot claim compensation for useful improvements fromthe fidecommissaries—Livera et al. v. Abeyesinghe et al.', a case whichwent up in appeal to the Privy Council
1 (1911) 14 A’, R■ 193.3 S. A. L. R. (1930) C. P. D., 1 at 4.
• S. A. L. R. (1920) C. P. D. 159.* (1914) 1S N. L. R. 57.
6 (1917) 19 N. L. R. 492.
386
Jasohamy and Podihamy.
It must be presumed* that Babunappu intended, when he made ‘theimprovement, to benefit ail his children. The rule of resulting trustwill not apply when an investment is made by a person in the name of hischild or children—Ammal v. Kangany
A pure claim for compensation cannot be asserted in a partition action—Silva v. Linohamy5; de Silva v. de Silva *.
U.A. Jayasundere (with him S. R. Wijayatilake) ,'for the first defendant,respondent.—The case of Mohamad Bhai et al. v. Silva et al. (supra)'is applicable to the facts of this case. The right to claim compensationis included in the conveyance 1 D 2 which transferred “ all the right,title and interest ” of the vendor.
Useful expenses can be recovered by a usufructuary—Maasdorp’sInstitutes of South African Law (5th ed.) vol. 2, p. 183. Even a usuarycan claim compensation—Maasdorp’s translation of Grotius II. c. 10, § 8.For meaning of the word “ bruicker ” see also Lee’s Introduction to Roman-Dutch Law (3rd ed.) , 186. The claim in Livera et al. v. Abeyesinghe et al.(supra) was not successful because it was made by a trespasser. See,(however, Dassanayake v. Tillekeratne ", Saibo v. Baba et al", Fletcher andFletcher v. Bulawayo Waterworks, Co., Ltd.', Rubin v. Bothas, Wille’sPrinciples of S. African Law, p. 353. The guiding principle is that aparty should not be enriched at the expense of another.
The question whether there was a resulting trust was not raised at thetrial. The evidence, indeed, is that the improvement was made byBabunappu for his own benefit and that his children (the owners) stoodby without protesting. In the circumstances the appellant, as vendeeof • Babunappu, is entitled to 'claim compensation—Walter Pereira’sLaws of Ceylon, p. 377, Nugapitiya v. Joseph ”, Wijeyesekere v. Meegama
A co-owner can, in a partition action, claim compensation for improve– ments—Jay aw ar dene’s Law of Partition, p. 117, Appuhamy v. Sanchi-hamy “,, Johannes v. Podisingho ”, Silva et al, v. Silva et al ”,
H. V. Perera, K.C., in reply.—A building can be. sold apart from theland on which it stands—jus superfigiarium. If the building comesdown, vendee cannot build again on the land. The subject-matterof the transfer in 1 D 2 was the building. The conveyance was one ofproperty and not of any chose-in-action. . The vendee of an improvementcannot claim compensation unless- the land on which it was built wasalso transferred.
It is true that a person who builds on-a property which he bona fidebelieves belongs to-him or which he thinks he has a right to occupy forsome substantial period can claim compensation. The compensation’is awarded-on the ground of failure of expectation. Such a question offailure of expectation does not arise in the present case. See Fletcher and. Fletcher v. Bulawayo Waterworks Co., Ltd.". I rely on the judgment ofKotze J. in Brundson’s Estate v. Brundson’s Estate, et al. (supra).
’ (1910) 13 N. L. R. S3.
3 (1913) 2 Bal. N. C. 19.
3 (1908) 1 S. C. D. 70.
* (1911) 14 N. L. 11. 193. ,
(1917) 20 N. L. R. 89.
« (1917) 19 N. L. R. 441.
S. A. L. R. 1915 A. D. 647.
8 S. A. L. R. 1911 A. D. 568.
8 (1926) 28 If. L. R. 140.
(1939) 40 N. L. R. 340..
(1919) 21 N. L. R. 33.
13 (1926) 28 N. L. R. 283.
(1911) 15 N. L. R. 79.
S. A. L. R. 1915, A. D. 647 at 649.
KEUNEMAN J.—Jasohamy and Podihamy.
387
At the time he put up the citroneUa distillery, which was not only auseful but also a necessary improvement, the father must be deemed tohave made a gift of it to all his children. His subsequent transfer of it toa particular child should be disregarded.
The legal position of the first defendant is not that of an improvingco-owner. If Babunappu had transferred to a stranger his right, if any,of claim to compensation, the latter would not be permitted to intervenein the present partition action. A person who has no interest in the soilbut has only a building on the land is not a co-owner of the commonproperty—Hamidu v. Gunasekera et al.1.
Cur. adv. vult.
July 7, 1943. Keuneman J.—
This is a partition action, in which the title to the soil shares was notin dispute. The only point of dispute was the ownership of the citronelladistillery on the land sought to be partitioned. It was admitted that thedistillery was about 35 years old.
The whole land at one time belonged to M. G. Babunappu, whotransferred it to his five children, including the first defendant, butreserved to himself the life interest in it (see P 7 or 1 D 7 of May 30, 1913).It is in evidence that the distillery was erected after, this date, and thefirst plaintiff, another child of Babunappu, stated that her husbandassisted Babunappu to erect the distillery, and that she thought Babun-appu was erecting it for his children, and that Babunappu possessed thedistillery in his life-time. By his deed 1 D 2 of January 24. 1934, Babun-appu for the sum of Rs. 300 sold the distillery to the first defendant,who stated that she was in exclusive possession of it from that datetill the death of Babunappu in 1941.
The learned District Judge held that the first defendant did not obtaintitle by virtue of deed 1 D 2 to the distillery, which became vested in thefive children of Babunappu. He further held that Babunappu had aclaim for compensation in respect of the distillery, and that by the deed1 D 2 this right of compensation was conveyed to the first defendant,and that the first defendant was entitled to claim Compensation from theother co-owners in respect of the distillery. He accordingly made orderthat it would be best if by agreement of parties the Commissioner appointedfor partition could divide the land so that the distillery falls within theblock allotted to the first defendant. Failing that, the question of theamount of the compensation was to be decided later.
From this decision the plaintiffs’ appeal and many matters of law wereargued before us. The first contention of the appellant was that thedeed 1 D 2 did not convey to the first defendant, the right to claimcompensation. By this deed Babunappu purported to convey the ironcitronella boiler and the buildings and appurtenances belonging theretotogether with all his right, title, and interest and all things belongingthereunto. In Mohamad Bhai et al. v. Silva et al.2 it was held that apurchaser of land stands in the same position as his vendors in regardto any claim for improvements made by the vendors. As Middleton J.put it, “ He will stand in the same position as they did in regard to anyclaim for compensation that might have been sustainable by them as1 (1922) 24 N. L. B. 143.* (1911) 14 N. L. B. 193. '
388KEUNEMAN J.—Jasohamy and Podihamy.
the successor in title of their right,' title, and interest in the property.”
It is contended that where the property itself was not conveyed, but theimprovement only, the right to claim compensation did not pass. I do notagree with this contention. In my opinion the words “ together with allmy right, title, and interest and all things belonging thereunto ” are wideenough to convey the right to claim compensation for the improvement.
Further, it was argued by the appellant that JBabunappu was only alusufructuary, and that as such he had no claim to compensation in respectof improvements made by him. No case has been cited to us, wherethis matter has been adjudicated upon in Ceylon, and the question is notfree from doubt. In Livera v. AbeyesingKe' it was held that a pur-chaser from a fiduciary heir could not claim compensation for usefulimprovements from the fidecommissaries. The matter went up in appealto the Privy Council—see Liyera v. Abeyesinghe' where this particularmatter was not decided, but on the facts the appellant was held not tohave acted bona fide. Later in Dassanayake v. Tillekeratne * it washeld that a fiduciary is entitled to the same right of compensation forimprovements as any other bona fide possessor, and to retention of theproperty until the compensation is paid, and that a purchaser from afiduciary is in the same position as the fiduciary.
The rights of the usufructuary have been considered in South Africa,and there is a conflict of opinion. Maasdorp in his Institutes of SouthAfrican Law (5th Edition) at page 183 says, ‘‘Useful expenses may alsobe recovered by the usufructuary at any rate to the extent to whichthe property has been enhanced in value thereby.” The authority cited isSchorer Note 228 to Grotius. Maasdorp, however, also refers to the caseof Brundson’s Estate v. Brundson’s Estate and Others' where, in a learnedjudgment Kotze J. points out inter alia that there was a mistranslation ofthe Dutch word “ bruickef ” in the text of Grotius. He adds that theword does not mean “ usuary ” but merely “ tenant or lessee ”. Kotze J.comes to the conclusion “ that the statement made by Schorer ….is not borne out by an examination of the sources, and that both principleand authority lead to the conclusion that a usufructuary is not, in the*absence of special circumstances, entitled to claim for improvementsmade by him to the property over which he enjoys the right of usufruct.”Kotze J. does not define what the “ special circumstances ” are.
As I have said before, this matter is not free from doubt, and willhave to be decided in a proper case. I do not think it is necessaryto decide the matter now, for the respondent contends that in this casethe improvements have been made with the consent and acquiescenceof‘ the true owners. The District Judge has so held, but the appellantdisputes that finding, and contends that in this case, it must be presumedthat Babunappu in making the improvements intended to benefit hischildren either at once or at his death. I do not think it is possibleto hold that he intended to benefit the children at once, because theevidence is that Babunappu was in possession of the-improvement fromthe time he made it, and it was an improvement which was useful forhis own occupation and enjoyment of the citronella land. Did he intend. that the improvement should go to his children at his death, so as to
[1914) IS N. L. R. 57.%(1917) 20 N. L. R. 89.
(1917) 10 y. L. R. 492.* S.A.L.R. (1920) C.P.D. 159'.
KEUNEMAN J.—Jasohamy and Podihamy.389
negative any claim for compensation for improvement on his part ?The evidence of the first plaintiff is that she thought her father was'erecting the distillery for his children, but this represents nothing more'than her hope, and perhaps explains the eagerness with which sheconsented to the improvement. As against this is the fact that theerection of the distillery was a good business proposition for Babunappuhimself, and the further fact that in 1934 he transferred the distilleryto one of the children only. This appears to have been done without anyprotest by the other children, and the first defendant has been inexclusive possession of the distillery from that date.
We have been asked to presume in this case that Babunappu intended,in making the improvement, to benefit his children Ijy it. It has certainlybeen held that a resulting trust, which would otherwise be held to arise,when one man pays the purchase price of property, but takes the transferin the name of another, may be rebutted, where such other person is thelawful wife or child. In such a case a prima facie but rebuttable pre-sumption arises, that the purchaser intended the ostensible granteeto take beneficially. No case has been cited to us, in which a similarpresumption has been applied to circumstances akin to those existingin the present case, and I think that in some of the cases cited to us,the point, if valid, may well have been taken. Apart, however, from anypresumption, I think it is permissible to lead evidence in a case of thisnature, to prove that the improver did not intend to benefit himself, orintended to benefit the real owner, so as to negative any claim forcompensation. On an examination of the whole of the evidence, whichis in fact very scanty, I think that we may hold that Babunappu erectedthe distillery for his own benefit, and not for the benefit of his children;His conduct is more consistent with that view, and I think it is more likelythat the children also took the same view. Also there is no evidencethat Babunappu ever expressed an intention that the improvementshould go to the children, and the fact that he retained a substantialinterest in the land and in the improvement, I think, entitles us to holdthat he made the improvement for his own benefit.
There can, I think, be no doubt that the children, the real owners of theproperty, consented to and acquiesced in the making of the improvements.
It has been strongly argued that even this does not give to a usufruc-tuary the right to claim compensation.
Wille in Principles 'Of South African Law (1937 edition), page 353 setsout the right to improvements to property as follows : —
“A person who expends money or labour in improving property,intending to do so for his own benefit, thinking either that the propertybelongs to himself, or that he has the right to occupy it for some sub-stantial period, whereas in fact he has no such right or title to theproperty and in consequence the improvements are acquired by theowner of the property, is entitled to claim from the latter the amountby which the property has been enhanced in value. Even a personwho has made improvements on another person’s property mala fide,that is, knowing he had no title to the property, is entitled to claimthe same measure of compensation if the owner stood by and allowedhim to make the improvements without objection.”
390Fernando v. Peiris.
It is to be noted that in South Africa the right to claim compensationhas been given to a bona fide occupier, e.g., a person holding an invalidlease as against his own lessor, and a person holding a lease from A, whounwittingly made improvements on B’s land. (Vide Rubin v. Botha1and Fletcher and Fletcher v. Bulawayo Waterworks Co. Ltd.').
Now in the present case, I think Babunappu must be regarded as amala fide improver, because he knew he had no title to the property.The rule that consent and acquiescence on the part of the owner givesa right of compensation to the improver is, I think, of wide application,and is not restricted to special classes of persons, such as lessees or,tenants. In Nugapitiya v. Joseph' Garvin J. said, “the owner who standsby … . will not be permitted to deny the improver’s statusto claim compensation, so that he may take the full benefit of theimprovement and enrich himself at the improver’s expense.” That caseis somewhat akin to the present case. I do not think that the right toclaim, compensation can be denied to Babunappu and to the purchaserfrom him—the first defendant.
I may add that the question whether the first defendant was entitled toa jus. retentionis did not arise for determination in the present case.
A further point was taken that’ the present claim to compensation beinga mere money claim cannot be asserted in a partition actioh, and reliancewas placed by the appellant on two cases, Silva v. Silva‘ and Silva v.Linohamy'. I do. not think these cases are of authority to-day—See Jayawardene on Partition, pages 118 to 120—-and they do not appearto be consistent with later decisions. I am inclined to be in agreementwith the dictum of Garvin A.G.J. in Johannes v. Podisingho* that “ theprovisions of the Partition Ordinance were clearly intended to be aproceeding for the determination of every material question in disputebetween the parties.”
The appeal is dismissed with costs.
Moseley J.—I agree.
Appeal dismissed.