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PERERA v. THALI^F.
G. R., Colombo, 27,620.
Lessor and lessee—Relief against forfeiture for breach of stipulations—Non-pay-ment of taxes by lessee—Refusal by Court to cancel lease on that account,
■ inasmuch as lessee had paid up all arrears.
The Court will grant a lessee relief against a provision in the leasegiving the lessor a right to claim a cancellation in the event of a breachof stipulation by the lessee, if the breach thereof did not involve anotably grave and damnifying misuse of the property leased.
The nature of the misuse that ought to be punished by expulsion, orcondemnation in damages, or even be passed over on account of' itsinsignificance, is entirely a matter that must be left to the discretion ofa careful and circumspect Judge.
Where a lessee had committed breach of a stipulation in' the lease byfailure to pay certain Municipal taxes on the property leased, but whensued by the lessor for a cancellation of the leaBe for breach of the stipu-lation aforesaid brought the full amount of the unpaid taxes into Court,and further proved payment of all subsequent taxes until the end of theterm of the lease, the Court refused to allow the' lessor’s claim for acancellation.
The default was not intentional and obdurate, but only due to carelessinadvertence which could be immediately remedied by payment, and hasbeen so remedied.
1ERTAIN premises iu Gabo’s lane, Colombo, were leased to theJ defendant for two years. During the continuance of the lease
the plaintiff purchased the leased premises, and also procured anassignment of the lessor’s interest in the said lease. One of thecovenants of the lease ran as follows:—“ That the said lessee shallpay all the taxes due on the said premises, and shall at his owncost and expense effect all the repairs of the demised premisesduring the term of his lease. ”
The lessee failed to pay the Municipal taxes for the four quartersof 1903, whereupon the lessor paid them.
This being a breach of the afore-mentioned stipulation, the plain-tiff brought this action for the cancellation of the contract of leaseand for ejectment of the defendant from the premises.
The learned District Judge dismissed his action.
The plaintiff appealed.
The case came up for argument on 23rd September, 1904.
Allan Drieberg, for appellant.
W. Jayawardene, for respondent.
[The following cases and authorities were cited by counsel: —Silva v. Dissanayake, 3 N. L. R. 248; Allis v. Sigera, 3 N. L. R.
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5; Wijeratne v. Hendrick, 3 N. L. R. 158; Amerestnghe v. Coder, 1904.
2 Br. 897; Foneeka v. Fernando, 2 8. C. R. 35; Punchi Appuhami Beeember 1.v. Punchi Appuhami, Ram. (.1872-1876) 293; Andris v. Rajapakse,
2 Br. 100; Rolfe v. Harris, 2 Price, 206; Hill v. Barclay, Vesey,
68 and 61; Kotze’s Van Leeuwen, vol. 11., 175; Qrotius’ Opinions,
262, 3, 4; Sanden v. Pope, 12, Vesey, 282.]
Cur. adv. vult.
1st December, 1904, Middleton, J.—
This was an action for the cancellation of a contract of lease andfor ejectment of the defendant from the premises on the groundthat defendant had committed a breach of covenant in not payingthe Municipal taxes on the property leased.
The breach was admitted, but it was contended on the strengthof the ruling of Bonser, C.J., in 3 N. L. R. 248, that the Courtwould only order the lease to be cancelled on the ground of “ fraud,accident, or mistake," and that in the present case the Municipaltaxes had not been paid owing to the mistake of the defendant innot seeing that his sub-lessee, who had covenanted to pay them,did so.
The plaintiff paid the taxes and brought this action and defend-ant brought the sum of Bs. 30 into Court, and it was alleged andnot denied that defendant had subsequently paid the taxes up tothe end of the term of the lease. Rolje v. Harris (2 Price, p. 206)and Hill v. Barclay (Vesey, 58, 61) were relied upon for theplaintiff.
In the former case it was held that the grounds on which theEnglish Courts would relieve in equity a forfeiture at law forbreach of covenant of a lease by a lessee were where the forfeiturewas the effect of inevitable accident and the injury or inconve-nience arising from it capable of compensation.
There is no inevitable accident here, but rather a careless omis-sion to see that the taxes were paid. The sum is a trifling one, andI should certainly not apprehend the danger the plaintiff appearsto. contemplate of the premises being sold up by the Municipalityfor non-payment under Ordinance No. 6 of 1873, considering themovables and interests seizable and salable before the propertyitself can be sold.
The injury or inconvenience arising from the non-payment ofBs. 13.74, which was the sum enforceable when plaintiff inter-vened,. could certainly be compensated for by payment before thepremises could possibly be sold.
Story, vol. 11., sect. 1316, says: “ The true foundation of the reliefin equity in all these cases is that, as the penalty is designed as a mere
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security, if the party obtains his money or his damages he gets allthat he expected and all that in justice he is entitled to.” Again,at p. 217 of Berwick's Translation of Voet (19, 2, 18) we find itstated: “ Lastly it .must be noticed that what has been said as toexpelling the tenant of ,aland onaccount of hisabuse of it is not
to be taken as referringtoeverytrifling matteror neglect of the
party respecting the manner of use, hut only to notably grave and
damnifying misuse As to the kinds of misuse, it must
be left entirely to the discretion of a careful and circumspectJudge to decide whether the abuse is such that it ought to bepunished by expulsionoronlycondemnationin the id quod
interest (i.e., damages),or.evenbe passed overon account of its
It is true here that the parties agreed that default in paymentof taxes should entitle the lessor to cancel -the lease and re-enterbut as the doctrine of equitable relief peculiar to the English Lawhas been recognized by the Court in the case reported in 3 N. L. B.248 and 2 Browne, 397, and as the principle of the RomanDutch Law, as Withers, J., says in the former case, seems to be thatwhich would be observed in cases of penal stipulation in con-tracts, my view is that I ought not to decree the cancellation ofthis contract.
The default was not intentional and obdurate, as in the case ofthe refusal to insure in Rolfe v. Harris, but practically a -pieceof somewhat careless inadvertence which could be immediatelyremedied by payment, and which has been so remedied.
I therefore dismiss the appeal, but under the cicrumstances ofthe case I order that each party pay his own costs of this appeal.
PERERA v. THALIFF