Bdbritingi* n. Commiationvr of Motional Rou&my
197S Present: Samarakoon, C.J., Vythialingam, J. andWanasundera, J.
P. D. EDIRISINGHE, Appellantand
THE COMMISSIONER OF NATIONAL HOUSING, RespondentS. C. 290/73 (Inty.)-D. C. Colombo 226/NH
National Housing Act (Cap 401) as amended by Acts, No. 42 of 1958 andNo. 36 of 1966. sections 2, 4, 9, 44(1), 63(3), 76, 76 (A), 85(1),86(1), 100(1)—Loan granted by Commissioner of National Housingon mortgage of premises—Default—Sale ordered under section76—Purchase by officer of such Department for and on behalf ofCommissioner—Whether Commissioner entitled to delegate powerto bid for and purchase the property—Delegatus non potestdelegare—Validity of sueh purchase—Observations as to whetherCommissioner a corporation sole.
The Commissioner of National Housing who was the respondentto this appeal sued the appellant nomine officii for ejectment fromcertain premises. These premises had earlier been mortgaged to theCommissioner and on default being made in payment of the loanwhich was secured by such mortgage, he had ordered a sale of thesepremises under section 76 of the National Housing Act. At the saleby public auction the premises were purchased by one L “ for andon behalf ” of the Commissioner. Thereafter certificate of sale wasissued in terms of section 85(1) of the Act vesting the propertyabsolutely in the Commissioner. Proceedings for ejectment of theappellant who was in occupation of a separate and distinct portionof the premises were instituted thereafter, it being averred that hehad failed to vacate the said land and premises though required todo so. It was submitted on behalf of the appellant that the Com-missioner could not maintain these proceedings for ejectment interalia as—
the purchase by L for and on behalf of the Commissionerwas invalid as the Commissioner could not validly delegatethe power vested ip him by statute to bid for and purchasethe property.
Held: (1) That the Commissioner of National Housing could notvalidly delegate the power to bid for and purchase the mortgagedproperty to L and that the purchase by L for and on behalf of theCommissioner did not make the Commissioner the purchaser. A certi-ficate of sale could therefore not issue vesting the property in theCommissioner. Accordingly the present application, for ejectmentunder section 86(1) of the National Housing Act. could not havebeen made by the Commissioner of National Housing as he was notthe purchaser.
(2) That inasmuch as the definition of Commissioner in the Actincluded a Deputy Commissioner and an Assistant Commissionersuch an official could therefore have been the purchaser. There wasnothing on record in the present case however to show that L fellinto this category of official.
Per Vythialingam, J. (obiter) :
That in regard to the submissions made on the basis that theCommissioner was not a corporation sole or juristic person, on aconsideration of the laws relating to the powers, duties and•functions of the Commissioner of National Housing, the legislaturedid intend to create the office as a corporation sole or at leastto make it a quasi corporation sole with all the attributes of acorporation 6ole.
SAMARAKOON.G, J.—Edirisinghe o. Commissioner of National Housing 209
Cases referred to :
Carllona Ltd. v. Commissioners of Works, (1943) 2 All E.R. 560-
The Range Forest Officer Ratnapnra v. P. A. D. Nandasena, S.C.969/73—M.C. Ralnapura 82530, SC. Mts. 27.2.1975.
Allin gham et al v. Minister of Agriculture and Fisheries, (1948)
1 All E.R. 780. ; 64 T.L.R. 290.
Hutli v. Clarke, (1890) 25 Q.B.D. 391 ; 63 L.T. 348 ; 6 T.L.R. 373.
Metropolitan Borough et al v. Roberts, (1949) 2 K.B. 608.
Inlcnd Revenue Commissioners v. Bew Estates Ltd., (1956) 2 AllE.R. 210; (1956) 3 W.L-R. 139 ; (1956) Ch. 407.
Samarasekera v. Secretary, D.C. Matara, 51 N.L.R. 90 ; 39 CL.W-108.
Salih v. Valliyammai Atchi, 63 N L R. 73 (P.C.); (1961) A.C-. 778 ;(1961) 2 W.L-R. 969.
The Land Commissioner v. Ladamuttu Pillai 62 N.L.R. 169 ;(1960) A.C. 854.
Mackenzie Kennedy v. Air Council, (1927) 2 K.B. 517 ; 138 L.T. 8 ;43 T.L-R. 733.
Hayley et al v. Nugaxoela, 35 N.L.R., 157.
Silva v. The Commissioner of National Housing, 70 N.L.R. 573.
Beatrice Perera v. The Commissioner of National Housing, 77N.L.R. 361.
Rajapaksc v. The Commissioner of National Housing, 74 N.L.R. 236.
Simon u» The Commissioner of National Housing, 75 N.L.R. 471.
Lewis v. Ulckua Dureya, 11 N.L.R. 33.
PPEAL from a judgment of the District Court, Colombo.
H. W. Jayewardene, Q.C., with J. W- Subasinghe and LakshmanPerera, for the appellant.
S. C. Dickens, State Counsel, for the respondent.
August 15, l!)78. Samarakoon, C.J.
I have had the advantage of reading the judgment of mybrother Vythialingam, J. I express no opinion on the questionas to whether the Commissioner of National Housing is acorporation sole or not. However, I agree with his order thatthe Commissioner could not validly delegate to P. K. Liyanage hispower to bid for and purchase the mortgaged property. TheCommissioner therefore, had no title vested in him to maintainthis application. I agree with the order proposed by my brotherVythialingam, J.
1 *•—A 52309 (80/10)
270 VYTHIAL1NGA.M, J.—Edirisinghe v. Commissioner of National Housing
In this case the Commissioner of National Housing sued,nomine officii the respondent and those claiming under him forejectment from the premises. set out in the petition and in theschedule to the affidavit in terms of section 86 (1) of theNational Housing Act (Cap. 401). Order Nisi under section377 (a) of the Civil Procedure Code was issued and therespondent duly appeared and showed cause. The DistrictJudge after inquiry rejected the submissions on behalf of therespondent and made the Order Nisi absolute and directed thatwrit be issued for the delivery of possession to the petitioner.The respondent has appealed from that order.
The case for the Commissioner was that.certain premises hadbeen mortgaged to him by one Ansel May Dharmaratne by deedNo. 342 dated 29th June, 1956, in respect of a loan of Rs. 100,000granted to her by the Commissioner. It was subsequentlytransferred by her to one A. D. J. P. Jayasuriya upon deedNo. 889 dated 21st March, 1961. Default was made in thepayment of a sum of Rs. 115,152.68 cts. and the Commissionerin terms of section 76 ordered the premises to be sold by publicauction. At the sale by public auction the premises werepurchased by' T. K. Liyanage “ for and on behalf-” of theCommissioner for Rs. 116,000. •
• The certificate of sale in terms of section 85(1) as amendedby Act No. 36 of 1966 was issued .by him vesting the propertyabsolutely in the Commissioner of National Housing. He averredthat the respondent who is in occupation of , a separate anddistinct portion of the said premises had failed to vacate the saidland' atfd premises though .thereto often demanded. It was inthese circumstances that he came to make- this application atoCourt under sec^on 86(1).
Mr. Javewardene for the respondent-appellant argued that:
the Commissioner of National Housing was not a corpora-tion sole and therefore could not sue nomine officii but couldonly sue in his personal capacity ;
the- Commissioner not being a juristic person could nothave title to the property vested in him as the Commissioner.and that the title under the certificate of sale vested only in theperson hen..holding the office of Commissioner of NationalHousing, namely, Duraisamy Rajendra ; and
that he could not validly .delegate the power vested inhim by statute, to bid for and purchase the property, to Liyanageand that the purchase by Liyanage for .and on behalf of theCommissioner was therefore not valid in law-
V YTJ1TA LI NOAM, J.—Edirisinghe v. Commissioner of National Housing 271
He, therefore, contended that the petitioner could not main-tain this action.
I will deal with the third submission first, since if Mr. Jaye-wardene suceeds in this submision, it would not be necessaryto consider the other two submissions. For this .purpose it isnecessary to notice some of the sections which are relevant forthe consideration of this submission. A fund called the NationalHousing Fund is established by section 4 for the purposes ofthe Act. Section 6(1) empowers the Minister under.the autho-rity of a resolution of the House of Representatives (now theNational State Assembly) to raise a .loan for the purposes ofthe Fund. Section 7 (1) as amended by Act No. 36 of 1966 setsout what moneys are to be paid into the Fund and section 7 (2)as well as other sections of the Act set out what moneys are tobe paid out of the Fund. Moneys to be paid into the Fundinclude moneys voted by Parliament and moneys to be paid outof the Fund includes all loans granted by .the Commissionerunder the Act.
Section 44(1) empowers the Commissioner to grant loans fromthe Fund to any person for the carrying out of any housingobject in accordance with regulations made for that purpose.In part IX of the Act the term “ appropriate authority ” withreference to a loan granted by .the Commissioner means theCommissioner (section 63(3) (b) ). Where in terms of section76 the “ appropriate authority ” orders the sale by public auctionof land mortgaged to that authority, section 76(A) as amendedby Act No. 42 of 1958.sets out that “the appropriate authoritymay at a sale by public auction of any land mortgaged to himas security for any loan, .bid for and purchase that land.” Themoney required for the purchase would come from the Fund.
The term Commissioner is defined in section 100(1) as theCommissioner of National Housing and includes a DeputyCommissioner and an Assistant Commissioner. I take it there-fore that a Deputy Commissioner or an Assistant Commissionerof National Housing can also bid for and purchase such property.In the performance or discharge of their powers, functions orduties they are .subject to the general or special directions ofthe Commissioner. In the instant case there is nothing in therecord to show that T. K. Liyanage was a Deputy Commis-sioner .or an Assistant Commissioner. He is described in thecertificate of sale under section 85 (1) as ’ “ a duly authorisedofficer of the Department of National Housing.” He is apparentlyone of “ such number of other officers and servants ” authorisedto be appointed under section 9(1) (c).
2/2 V YT HJ ALIN GAM, J.—tidirisitighe t:. Commissioner of Nudonnl Housing
Mr. Jayewardene’s submission was that the power to bid forand .purchase the property was vested by Parliament in theCommissioner of National Housing and it is he who must exer-cise that power. There is no power vested in him eitherexpressly or by,necessary implication to delegate that power toanyone else and on the basis of the maxim delegatus non potestdelegare (or dclegari) he could not validly delegate that powerto anyone else. We are here not concerned with a grant oflegislative, judicial or disciplinary power, in which case there is astrong presumption against construing a grant of such power asimpliedly authorising sub-delegation.
We are concerned in. the instant case with the power conferredon a person by his proper style and title. There is in the Actno express authorisation to delegate that power. Is , there thenan implied power to delegate such a power ? And- the centralquestion as always, is what Parliament intended to do. In thiscontext the maxim delegatus non potest, delegare, like so manyother rules of administrative law, turns out, to be no more thana qualified rule for the interpretation of the statute to ascertainParliament’s intention. Where a statute provides that a namedofficial may do this or that Parliament intends that he alone maydo so and not that anyone, else may do it. This is more so wherethe power is coupled with a duty and/or discretion.
However, “ the maxim delegatus non potest delegare doeS notenunciate a rule t'nat knows no exception ; it is a rule of construc-tion to the effect that ‘ a discretion conferred by statute is primafacie intended to be exercised by the authority on which thestatute has conferred it and by no other authority, but thisintention may be negatived by any contrary indications found inthe scope or object of the statute S. A. de Smith, JudicialReview of Administrative Action, 2nd Edition, p. 284.
In the instant case the Commissioner of National Housing “maybid for and purchase ” the mortgaged property which he hasdirected to be sold by public auction. There is a discretion vestedin him to purchase or not. In making his decision he has to have inview the housing objects as set out in section 2(a) to (h). Forotherwise he need not purchase the property at all. In directingthat the mortgaged property be sold by public auction he mayfix an upset price below’- which the land mortgaged to him assecurity for the loan shall not be sold to any person other thanthat authority. The upset price will generally be in excess of thebalance sum due on loan with interest and expenses. So that theCommissioner stands to lose nothing by not purchasing theproperty if the bids are above the upset price. The decision as to
VYTHIA LI N'CAJI, J.—i>!n isinghe v. Commissioner of National Housing 273
whether the purchase of the property is for carrying out uehousing objects is undoubtedly an important one or he may alsodecide not to purchase the property having regard to thecondition in which it is.
Equally important is the decision as to the price at whichhe is going to purchase the property. This involves the expen-diture of large sums, in the instant case Rs. 11.6,000 from publicfunds, for the purchase money has to come from the NationalHousing Fund. If the bids are too high he may consider that itis more advantageous to have the purchase price credited tothe National Housing Fund than to spend money out of it for thepurchase of the property. These are important decisions which areentrusted to a responsible official like the Commissioner ofNational Housing. It is a well-known principle of law that whena power has been confided to a person in circumstances indicatingthat trust is being placed in his individual judgment anddiscretion he must exercise that power personally, unless he hasbeen expressly empowered to delegate it to another. There isno such express provision in the Act. Nor do I see any contraryintention indicated in the language, scope or object of the statute.
Mr. Charles Dickens, State Attorney, for the Commissioner ofNational Housing submitted that the Commissioner of NationalHousing is a busy official and that he cannot be expected to goall. over the country to bid for and purchase mortgaged propertywhich he has directed to be sold by public auction. He submittedchat considerations of administrative and practical conveniencewould justify his entrusting the power to an authorised officerof his department. Much of the force of this contention is lostowing to the fact that the term 1 the Commissioner ’ includes aDeputy'and Assistant Commissioner and he could thereforevalidly entrust this power to his deputy or one of his assistantCommissioners.
In support of his contention he relied' very strongly on the oftquoted passage of Lord Greene, M. R. in the case of Carltona v.Commissioner of Works', (1943) 2 A.E.R. p. 560 at 563, that “In1he administration of Government in this country the functionswhich are given to Ministers (and constitutionally properly givento Ministers because they are constitutionally responsible) arefunctions so multifarious that no Minister could.ever personallyattend to them. To take the example of the present case nodoubt there have been thousands of requisitions in this countryby individual Ministries. It cannot be supposed that this regula-tion meant that in each case the Minister in person should directhis mind to the matter. The duties imposed on Ministers and.
2 74 VYTHIALINGAir, J .—Eilirisinghc v. Commissioner of Xutionul Housing
the powers given to Ministers are normally exercised under theauthority of the Ministers by responsible officials of the depart-ment. Public business could not be carried on if that were notthe case. ”
The position has been accepted as far as our country isconcerned by this Court in the case, of The Range Forest OfficerRatnapura v. P. A. D. Nandasenc. S.C. 969/73—M.C. Ratnapura82530 ; S.C. Mts. 27.2.1975, overruling a decision of a single Judgeof the former Supreme Court in a case on the same point andunder the same regulation S.C. 1238-9/68 M.C. Badulla—7280 ;S.C. Mts. 8.5.1970. In that case the Minister was given the powerto prohibit the transport of specified species of timber within orout of any area. By regulation the Minister vested that powerin the Conservator of Forests. In holding that the Minister hadthe power to do so Walpita, J. with Ismail, J. agreeing afterquoting the above passage from Lord Greene’s judgment andother passages from S. A. de Smith and Wade said :One cannot
expect the Minister in the midst of his manifold duties, to takeupon himself the task of specifying or demarcating the areasor the species of timber to which the prohibition applies. This isan administrative matter that has to be passed on to his depart-mental officials for whose actions he is responsible toParliament. ”
This is because “ A civil servant is his Minister's alter ego. anda decision taken by a civil servant in the name of the Minister orthe department is not open to objection as a form of unauthorisedsub-delegation, provided at least that the servant has actual orimplied authority so to act and the matter is not so importantas to demand the Minister’s personal attention ’’—Halsbury,Laws of England, 4th Edition, Vol. 1 p. 34, para 32. Generallysuch officials cover themselves up by using some such formulaas “ I am directed by the Minister,” or “ the Minister is of theopinion ” or “ the Minister has decided ” and so on. Governmentofficials on whom Parliament has vested powers which involveduties and/or the exercise of discretion do not stand on the samefooting as Minister.-; because prirna facie Parliament intendedthat they alone and no one else should exercise those powers.
Thus in the case of Allingham et al. v. Minister of Agricultureand Fisheries,(1948) 1 All E. R. 780, the Minister was given
power to give such directions with respect to the cultivation,management or use of land for agricultural purposes as he thinksnecessary by notice relating to the land specified therein to theperson by whom the direction shall be complied with. He hadthe authority to, and did delegate his powers in this respect to
VYTKIAI. INGAM, J. —Edirisinghe v. Commissioner of National Housing
the War Agricultural Executive Committee. The WarAgricultural Executive Committee came to the conclusion thateight acres of sugar beet should be grown by the appellants forthe 1947 season and gave them notice that this sugar beet wasto be grown on a field to be named by their executive officerand he accordingly did so. It was held that the committee couldnot" delegate the power to determine the land to be cultivatedto its executive officer and therefore the notice was ineffectiveand non compliance with it was not an offence.
In the course of his judgment Lord Goddard, C.J. pointed out atpage 781, “ In other words they delegated to the executiveofficer the task of deciding the land which was to be the subjectof the notice to be served. I can find no provision in any orderhaving statutory effect or regulation which gives the executivecommittee power to delegate that which the Minister has ladecide and which he has power to delegate to the committee todecide for him. If he has delegated, as he has, his power oTmaking decisions to the executive committee, it is the executivecommittee that must make the decision, and, on the ordinaryprinciple of delegatus, non potest delegare they cannot delegatetheir power to some other person or bodj .”
Mr. Dickens next submitted that here there was no delegationof the power vested in the Commissioner but that Liyanage wassimply acting as his agent. The relation of agency arises wheneverone person called the agent has authority to act on behalf ofanother called the principal and consents so to act. It is true thatin administrative law the concepts of delegation and agencyhave sometimes been treated as being virtually indistinguishable.Thus in Huth v. Clarke, 25 Q.B.D. 391 at 395, Wills. J. said“ Delegation as the word is generally used does not imply aparting with powers by the person who grants the delegation butpoints rather to the conferring of an authority to do things whichotherwise that person would have to do himself. ”
But in the case of agency, also “ Delegation by an agent, thatis the entrusting to another person by an agent of the exerciseof a power or duty entrusted to him by his principal is in generalprohibited, under the maxim delegatus non potest delegare,without the express authority of the principal or authority ofthe principal or authority derived from statute. Where there ispersonal confidence reposed in, or skill required from the agentthere normally may be no delegation, however, general thenature of the duties, unless urgent necessity compels the hand-ing over of the responsibility to another. ”—Halsbury, Laws of
276 VYTHI ALIN GAM, J.—Edirisinghe u. Commissioner of National Housing
England, 4th Edition, Vol. 1, page 448, para 747. As I haveendeavoured to show Parliament has vested the discretion tobid for and purchase the mortgaged property in a responsibleofficial like the Commissioner of National Housing and he cannotdelegate that function to anyone else. There is also, in theinstant case no urgent necessity compelling him to do so.
An agent is also usually capable of being given detaileddirections by his principal and does not usually have a widearea of personal discretion. A delegate on the other hand towhom discretionary powers are delegated has a substantialmeasure of freedom in exercising them. Where there are effectivepowers of control retained by the delegating authority the Courtswill more readily uphold the validity of the delegation, generallyby denying that there has been any delegation at all, usuallyon the ground that in substance the. authority in which the dis-cretion has been vested by statute continues to address its ownmind to the exercise of the powers.
In the case of Metropolitan Borough et al v. Roberts, (1949)
2 K.B. 608, a departmental official one Mr. O’Gara delegated ^hetask of requisitioning certain property which earlier had beenderequisitioned to the town clerk of the borough, who proceededto do so. In an action by him to recover possession of thepremises pursuant to the requisition it was argued inter alia thatthe official could not have delegated the power to the town clerk.It was held that he could do so. Bucknill, L.J. said at page 691 :“The question whether in “this case the Minister, acting throughO’Gara lawfully delegated his powers 1 of requisitioning theground floor of this house to the town clerk must be consideredin the light of the particular circumstances of this case. In thiscase no discretion was left to the town clerk whether he shouldagain requisition the ground floor or not. All the facts wereplaced before the Minister and under the special circumstanceshe delegated his powers to requisition the property to the townclerk. ”
And Denning, L.J. pointed out at page 621 : “ When the Govern-ment department delegates its functions to a town clerk underregulation 61 (5) it is only putting someone in its place to do theacts which it is authorised to do. The town clerk is so to speakan agent of the department and a sub-agent of the Crown. Thedelegation to the town clerk is simply administrative machineryso as to enable the administrative function of requisitioning tooperate smoothly and efficiently.”
Such is not the case here. There is no evidence that theCommissioner gave any directions to Liyanage or that he retainedany control over him in the matter of bidding for and purchasing
VYTHIALIXG AM, J.—Kdiridiuyhe v. Comm ins to aer of yalio nul Housing 277
the properly, which would indicate that the decisions were reallyhis. The entire discretion was delegated by the Commissioner toLiyanage. In the lower Court counsel who appeared for theCommissioner stated that Liyanage ‘was authorised in writingby the Commissioner to bid for and purchase the property. Butno such writing has been produced. Nor is there any evidencein regard to what the terms of that authorisation were. Thecertificate of sale describes Liyanage only as a duly authorisedofficer of the department. It is true that the certificate of salestates that the properly was bought by Liyanage “ for and onbehalf of the Commissioner of National Housing.” They do notindicate that the decision to purchase the property and the limitto which Liyanage could go in the bidding at the auction weremade by the Commissioner and not by Liyanage.
I hold therefore that the delegation of the power to bid forand purchase the mortgaged property vested in him by thestatute was not validly delegated to Liyanage by the Commis-sioner and that the purchase by Liyanage for and on behalf ofthe Commissioner did not make the Commissioner the purchaserof the property to whom the appropriate authority could haveissued the certificate of sale vesting the property in him. Undersection 86 (1) only the purchaser could have made this applica-tion to Court and the Commissioner not being the purchaser, inthe instant case, it was not competent for him to have made thisapplication. This is sufficient to dispose of the appeal.
However, since the other two points were argued before usand they were indeed Mr. Jayewardene’s main submissions Iwould like to express my view in regard to them without, how-ever, deciding them. Mr. Jayewardene’s contention was that theCommissioner of National Housing was neither a Corporationsole nor a legal persona and could not therefore have propertyvested in him or sue or be sued nomine officii. Our law in regardto corporations is the English law as would be administered inEngland at the corresponding period—section 3, Civil LawOrdinance (Cap. 79). In English law corporations are dividedinto two main classes, namely, Corporations aggregate andCorporations sole. We are here concerned with a corporation solewhich is “ a body politic having perpetual succession, constitutedin a single person who in right of some office or function lias acapacity to take, purchase, hold or demise (and in some parti-cular instances, under qualifications and restrictions introducedby statutes, power to alienate) real property, and now, it wouldseem, also to take and hold person?! property, to him and to
278 VYTHIA.LTNGAM, J.—l‘?<iiri.*inghc v. Commissioner of National Housing
his successors in such office for ever, the succession being per-petual, but not always uninterruptedly continuous ; that is,there may be, and often are, periods in the duration of a corpora-tion sole, occurring irregularly in which there is a vacancy, orno one in existence in whom the Corporation resides and isvisibly represented. ”—Halsbury, Laws cf England, 4th Edition,Vol. 9, page 719, para 1206.
Unlike a corporation aggregate, a corporation sole has a doublecapacity, namely, its corporate capacity and its natural andindividual capacity. So that there may be changes in the indi-viduals holding the office or performing the function but thecorporation goes on for ever. This is best exemplified in theproclamation which is made when the reigning British Monarchdies which is “ The King is dead. Long live the King.” At presentunder the law of England a corporation is created by one orother of two methods (1) by royal charter of incorporationfrom the Crown, or (2) by the authority of Parliament, that isto say, by or by virtue of the statute. There are in addition,corporations known to the common law, as for example, theSovereign, parsons, bishops and so on.
The Commissioner of National Housing has not been createda corporation sole by express enactment. However, “ To cons-titute creation it is not necessary that any particular form ofwords should be used in the statute : it is sufficient if the intentto incorporate is evident. ” Halsbury, Laws of England, 4thEdition, Vol. 9, page 742, para. 1246. Mr. Jayewardene arguedthat no such intent to create the Commissioner as a corporationsole or a legal persona was evidenced by Parliament in the previ-sions of the National Housing Act. It becomes necessary thereforeto consider these provisions with a view to ascertaining whetherthere is any such intention or not.
One may begin with the provisions relating to this application.Under section 44 (1) the Commissioner may grant loans fromthe National Housing Fund for the ■ purposes of the -Act inaccordance with the regulations made under the section. But nosuch loan shall be granted unless its repayment (a) is securedby a mortgage of immovable property in Ceylon, or (b) issecured by the transfer or assignment of a policy of life insurance,or (c) is guaranteed by a commercial bank as defined in theMonetary Law Act and which is approved by the Minister—Regulation 3. (National Housing (No. 1) Regulations of 1954 ;
VYTHIALtNGAM, .f.-—Ediriainghe v. Commissioner of Xaliomil Housing 270
Subsidiary Legislation Vol. VII, p. 83.) All such mortgages shallbe executed in favour of the appropriate authority who is theCommissioner and shall be in sudh one of the prescribed formsas may be appropriate in that behalf—Section 71 (1) as amendedby Act No. 42 of 1958, and Act No. 36 of 1966.
Where there is default in the repayment the Commissionermay order the sale of the property mortgaged to him and he maybid for and purchase the property. These are wide discretionarypowers which under the ordinary law a mortgagee can do onlyon the orders of a Court. When the property is purchased bythe Commissioner he signs a certificate of sale and “ thereuponall the right, title and interest of the borrower to and in the landshall vest in the purchaser,” i.e., the Commissioner—Section 85(1) as amended by Act No. 16 of 1936. I emphasise these words
of the section that “ all the right, title and interest in the
land shall vest in the purchaser. ” That is, the Commissioner. Andfinally the purchaser, that is the Commissioner, may make anapplication to Court to obtain delivery of possession of the land.
Then there are the provisions of Part VIII of the Act dealingwith the compulsory acquisition of land for carrying out housingobjects and disposition of Crown land. A disposition of any- Crown land as is set out in section 50 (1) may be made for thatpurpose under the Act by the appropriate authority with theprior approval of the Minister, and subject to such conditionsas the Minister may determine and to such further conditionsas are or are required to be imposed by or under the Act. Sucha disposition shall be effected by an instrument of dispositionsigned and executed by the appropriateauthority—
sub section 5. Section 61 provides that “ For the purposes of thisPart, t’iie expression “ appropriate authority ” means theCommissioner or any officer authorised by him in that behalf. ”
By section 31 (1) the Commissioner is empowered to providehouses for occupation by any person whether upon payment ofrent or not. Sub-section (2) declares that where a house isprovided by the Commissioner for .occupation by any person thenwith reference to that house the expression “landlord” in thispart means the Commissioner. Where such occupier does notvacate the house after the date of the lawful termination of hisoccupation thereof it shall be lawful for the landlord that isto say the Commissioner, to file in the appropriate Court of
280 VYTHIALINGAM, J.—Edirisin-jhc v. Commissioner of National Housing
Requests an application for recovery of possession and for theejectment of the occupier and his dependants—Section 33.1 asamended by Act No. 36 of 1966. Section 37 provides that no actionfor the recovery of the possession of any house to which thisPart applies or for the ejectment of the occupier from the landor premises in which the house is situated shall be taken exceptunder the provisions of this part.
The Commissioner is also vested with certain powers, dutiesand functions under other laws as well. Section 47 of the Ceilingon Housing Property Law (Law No. 1 of 1973) sets out that unlessthe context otherwise requires the term “ Commissioner ” in thatlav/ means the Commissioner of National Housing. Under section11 (1) and (2) all houses owned by a person in excess of thenumber of houses permitted under that Law shall vest in theCommissioner and under section 12 (1) he may transfer suchhouse to any local authority, Government Department or publicCorporation and he has the power under t'hat law to sell suchhouses, but under section 12 (2) he must in the first 'instance offerit for sale to the tenant. Then section 15 (2) provides that“ Where any house is vested in the Commissioner under this lawthe Commissioner shall have absolute title to such house andfree from encumbrance and such vesting shall be final andconclusive for all purposes against all persons whomsoever,whatever right or interest they have or claim to have to, or in,such house ” subject to certain liens in certain persons on thepurchase price to be paid to the owner.
Where any house or flat or tenement is vested in the Commis-sioner there shall be vested in him also such extent of land andsuch other rights as in his opinion are reasonably appurtenantto such house, flat or tenement—Section 16 (1). Where a tenantmakes an application under section 13 for the purchase of houselet to him, on the Commissioner being satisfied of the mattersset out in section 17 (1) the Minister may vest such house in theCommissioner. Section 18 makes provision for the Commissionerto take possession of a house vested in him.
It will be seen that, in these laws power is vested in theCommissioner to enter into contracts or agreements and title toand interests in immovable property are vested in the Commis-sioner of National Housing. If the contention here advanced iscorrect then such title and interests are vested in and the personv/ho .may enforce rights under the contracts or agreements willbe, the individual for the time being holding the office and wfllremain in him even when he goes on transfer, retires or ceases
VYTHIAUN.GAM, J. — htlmoimjhe v. (Himminsiom r <<J Sulionnl Hnuxiny L'sl.
to hold office. In such a case there will be no way of controllinghim. Nor can the Minister give him any general or special direc-tions under section 8 (2) in respect of these interests' for thepurpose carrying out the objects of the laws. Nor will suchindividual be able to carry them out even though these interestsare still vested in him as he is no longer the Commissioner ofNational Housing. In the instant case at the’time the Certificateof Sale was issued the Copimissioner was D. Rajendra, whileat the time the application was made it was I. A. E. Fernando andthe present holder of the post is M. D. G. Jayawardene. Thisindicates how the individual holding the post changes from timeto time.
The position is worse when, such person dies for the property.will then pass to his heirs subject, of course to any equities, interms of section 21 (1) of the Matrimonial Rights and InheritanceOrdinance (Chapter 57). Any rights under any contracts oragreements entered into by him will also pass to his heirs. Thelegislature could not have intended this to be so in respect ofproperties and interests acquired with public funds and for publicpurposes. I think that there is here a manifest intention on thepart of the legislature if not to create the Commissioner ofNational Housing as a corporation sole, at least to make him aquasi corporation sole having all the attributes of a Corporationsole as are necessary for the proper discharge of his functionsunder the laws. To hold otherwise wouLd be to render these lawspractically unworkable.
Such quasi corporations are well known to the English law.Halsbury points out—Laws of England, 4th Edition, Vol. 9, page716,. Para. 1201—“There are many associations' and bodiesof persons that are not corporations. Some of these suchas registered friendly societies may be regarded as quasi corpo-rations as they have some of the usual attributes of a corporationsole such as the possession of a name in which they may sue orbe sued and the power (independently of any contract betweenthe members) to hold property for the purposes defined by theirobjects and constitutions.” In the case of Inland RevenueCommissioner v. Bern Estate Ltd. (1956) 2 All E. R. 210, it was heldthat the War Damage Commission was a quasi corporation.Roxburgh, J. said at page 213 “ Parliament has recently shownan increasing fondness for cieating^quasi corporations, i.e., bodiesdifferent from the aggregate of members, e g., a members club,and yet not corporations in the language of jurisprudence. Inmy judgment the War Damage Commission is such a quasiCorporation. ”
282 VYTHIALINGAM, J.—Edirisinghe v. Commissioner of National Housing
The fact that certain offices,are quasi corporations sole has beenwell-established in our country. Under section 520 of the CivilProcedure Code when there is no fit and proper person to beappointed as an administrator the District Court has power toappoint the secretary of that Court as the administrator and ithas been held that in such a case the secretary qua administratoris a quasi corporation sole. In the case of Saviarasekera v. Secre-tary D.C. Matara, 51 N.L.R. 90, Basnayake, J. in so holding said atpage 93 “ Although the secretary of the Court is not a corporat-ion sole in the true sense of the term, having regard to the factthat the Civil Procedure Code provides for the appointment ofthe secretary of the Court as administrator it may safely beassumed that the legislature 'intended that the secretary of theCourt should possess all such attributes of a corporation sole asare necessary for the proper discharge of his functions quaadministrator. Such offices fall into the category of quasicorporations sole. ”
The judgment was expressly approved by the Privy Councilin the case of Salih v. Valliyammai Atchi, 63 N.L.R. 73, Lord Rad-cliff said at page 80 : “ The sum of their judgment was expressedin their holding that the Civil Procedure Code intended theSecretary of the Court to possess ‘ all such attributes of a cor-poration sole as are necessary for the proper discharge of hisfunctions qua administrator. ’ Their Lordships accept this as thecorrect position. ” TLey did this, “ Despite the difficulties createdby the wording of certain sections and of the prescribed forms ”
for the reason that “having regard to the functions to be
performed by the secretary of the district court and the evidentintention that his office should carry a continuing responsibilityfor the property to be administered, it must have been intendedthat the Code should create the holder of the office a corporationsole for this purpose. ” These observations apply with evengreater force to the Commissioner in this cas6 for the reasonsset out by me earlier.- 0
In support of his contention that the Commissioner in theinstant case was not a corporation sole or a legal personaMr. Jayewardene relied on the decision of the Privy Council inthe case .of The Land Commissioner v. Ladamuthu Pillai, 63 N.L.R.169, in which 'it was held‘‘by the Privy Council that t?he LandCommissioner was not a corporation sole. It was so held on aconsideration of the'definition of Land Commissioner in the Land
VYTHCALINGAM, J.—Edirisinghe v. Commissioner of National Housing 283
Development Ordinance (Cap. 464) and on a consideration of itsprovisions and the functions, powers and duties entrusted to him.That case howeyer is easily distinguishable from the facts of theinstant case. The powers, duties and functions of the LandCommissioner under that Ordinance are nowhere analogous tohie powers, duties and functions of the Commissioner of NationalHousing. He does not acquire property in his name. He is notempowered to sue or be sued. He makes no disposition of propertyin the sense in which the Commissioner of National Housingdoes. He does not enter into contracts or agreements. He merelymakes decision on behalf of the Crown.
So Lord Morris said. “It was sought to be said that the LandCommissioner is a corporation sole. Their Lordships do not findsupport for this view in the provisions of the Land DevelopmentOrdinance of 1935. The Land Commissioner is not expresslycreated a Corporation sole by any legislative enactment nor is itlaid down that he may sue or be sued in a corporate name.Furthermore no legislative enactment seems to reveal any inten-tion to incorporate. If following upon a determination by theLand Commissioner (which if made within his powers is made‘ in the exercise of his individual judgement ’) land is acquiredsuch land does not vest in the Land Commissioner. ”
Mr. Jayewardene also relied'on the case of Mackenzie Kennedyv. Air Council, (1927) 2 K. B. 517. I do not think that the decisionin that case is a satisfactory authority in support of the contentionurged by Mr. Jayewardene. It was an action founded in tort andthe main decision in that case was that the Air Council being astatutory body performing duties assigned to them by the Crown,no proceedings to enforce a remedy dor tort would lie againstthe Crown or its delegates as the Crown can do no wrong. Onthe question as to whether the Air Council was a corporationaggregate or not Bankes, L. J., merely said that it was not acorporation and that even if it was treated as one it would be ofno avail to the plaintiff as a wrongful act cannot be done forthe Crown and such a corporation is not capable of doing sucha, wrongful act in its corporate capacity. Scrutton, L. J., madeno reference to this question and rebted his decision on the factthat an earlier decision was res judicata between the parties.
It was only Atkin, L. J., who rested his decision on the factthat the Air Council was not a corporation aggregate. He was of
284 VYTHI AIDING AM, J.—Edirisinghe v. Com oiissicner of National Housing(t1
the view that an action would lie against a statutorily incorpora-ted body for though an action in tort will not lie against aservant of the Crown in a representative capacity yet in aprivate capacity the liability could extend to a juristic person,the corporation, as well as the individual. He then went on toconsider the question as t.o whether the Air Council was acorporation and held that it was not although it had most if notall of the characteristics of a corporation, namely it had a name,it could sue and be sued by that name, it had a seal which hadto be judicially noticed and it could hold property.
The reason why he held tihat it was not a corporation was thatthe Air Council consisted of individual members to whom-separate duties and responsibilities were assigned. Subject to theprivate capacity the liability could extend to a juristic person,the powers and duties of the Air Council could be exercised andperformed by any three members. Lord Atkin pointed out atpage 531 : “ But, unless incorporated, the A'ir Council is but aname for several important officials, who have administrativeduties assigned to them on behalf of the Crown. ” In other words,it was not a corporation aggregate, distinct from the aggregateof individuals composing it. So he was not prepared to assumeany intention to incorporate in ihe absence of “ express wordsof incorporation and express definition of the purposes for whichthe department was incorporated. ”
But quite apart from this Parliament, without creating acorporation or quasi corporation sole may enable an officialeither expressly or by necessary implication or intent to sueor be sued in that capacity. Thus section 30 of the BuddhistTemporalities Ordinance (Cap. 318) enables a trustee under thatOrdinance to sue and be sued as trustee. But it was held in thecase of Hayley et al v. Nugawella, 35 N.L.R. 157, that such atrustee was not a corporation. In tine instant case section 33 (1)and 86 (1) enable the Commissioner of National Housing to makeapplications to Court as the landlord or purchaser respectively.There are several cases^in which the Commissioner of NationalHousing has sued nomine officii without objection—see G. P. N.Silva v. The Commissioner of National Housing, 70 N.L.R. 573, aslandlord, Beatrice Perera v. The Commissioner of National
VYTHIALLNGAM, J.—Edirisingh* v. Commissioner of National Housing 286
Housing, 77 N.L.R. 361, under the Protection of Tenants Act,Rajapakse v. The Commissioner of National Housing, 74 NJ_i.R.236, where mortgaged property was bought by him and given tothe respondent for occupation and W. D. Simon v. The Commis-sioner of National Housing, 75 N.L.R. 471, also under the Protec-tion of Tenants Act. I do not say that merely because the objectionwas not taken in these cases the objections cannot be taken inthe instant case. I refer to them merely for the purpose of show-ing the practice that has been developed and had been accepted.
Similarly Parliament can either expressly or by implicationprovide that the holders of any office will have perpetual succes-sion. Mr. Jayewardene referred us to tine case of Lewis v. -Ukk.uaDureya, 11 N.L.R. 33, in which it was held that the Fiscal is not acorporation sole with the right of perpetual succession, and thatthe succdssor in office of a Fiscal in whose favour an obligationis created by bond has no right to maintain an action on suchbond even where the obligation is created in favour of the saidFiscal and his successors. That decision was handed down onthe 11th February, 1908 and on 18th November, 1908. The FiscalOrdinance was amended to provide for this by the addition ofsection 83A, now section 15. Similar provision is made in respectof bonds made in favour of secretaries of District Courts bysection 751 of the Civil Procedure Code.
I am therefore of the view that, on a consideration of the lawsrelating to the powers, duties and functions of the Commissionerof National Housing, Parliament did intend to create the officeas a corporation isole or at least to make it a quasi corporationsole with all the attributes of a corporation sole. However, as Isaid I do not base my decision on this appeal on this ground buton the ground that the Commissioner could not validly delegatethe power to bid for and purchase the mortgaged property to athird person. No title therefore vested in him and he could nothave made this application.
The appeal is accordingly allowed, the order absolute enteredby the District Judge set aside and the application of the Com-missioner is refused with oosts both here and in the Court below.
MALCOLM PERERA. J. —Sujfiyan v. ftatnayake
I am of the view that there has been an improper delegation ofhis powers by the Commissioner of National Housing, andaccordingly he had no title to maintain this application. I
I am therefore in agreement with the order proposed by mybrother Vythialingam, J.