188-NLR-NLR-V-47-PIYARATNA-NAYAKA-THERO-Appellant-and-DHAMMANANDA-NAYAKA-THERO-Respondent.pdf
Piyaraiana Thero v. Dharr,mananda Thero.
537
1946Present : Keuneman S.P.J. and Jayetileke J.PIYARATANA NAYAKA THERO, Appellant, andDHAMMANANDA NAYAKA THERO, Respondent.
215—D. C. Colombo, 2,882.
Trust—Trustee holding office in public institution—Devolution of trust propertyon him without any conveyance or vesting order—Trusts Ordinance(Cap. 72), ss. 113 (1) (2) (3).
Thirteen persons formed themselves into a Sabha the object of whichwas to establish a Pirivena. It was agreed among them that the rightof appointment of the Principal and Teachers of the said Pirivena shouldbe with the Sabha.
One of the members of the Sabha, who was the owner of the premiseson which the Pirivena was built, in furtherance of the common objectgranted the premises by deed of gift to the Principal and to his successorsin the office of Principal. In an action brought by a successor in officeto the original grantee praying inter alia for a declaration that he heldthe premises in trust for and as trustee of the 2nd to the 14th defendantsas members of the Sabha, and that the 1st defendant who was in wrongfuloccupation of a portion of the premises be ejected—
Held, that sub-section 1, and not sub-sections 2 and 3, of section 113of the Trusts Ordinance was applicable and that the plaintiff was entitledto maintain the action without the need of any conveyance, vesting orderor other assurance.
A
PPEAL from a judgment of the District Court of Colombo. Thematerial facts appear from the head note.
638
Piyaratana Thera v. Z>ha mm ananda Thero.
-R- L. Pereira, K.C. (with himfr. A. Rajapakse, K.C., O. T. Samarawick-rame and Dharmakirti Peiris), for the plaintiff, appellant.—The questionthat arose for consideration on the preliminary issues of law that weretried was whether the plaintiff was duly appointed trustee accordingto the requirements of the Trust Ordinance. By the original deedcreating the trust (P2A) the premises in question were given “ to theVen. Sumangala Nayaka Thero, Principal of the Vidyodaya Pirivena,and on his demise to the Principals appointed to the Pirivena by theparties of the second part …. The plaintiff is the Principal of
the Vidyodaya Pirivena and in terms of section 113 (1) Trusts Ordinancethe title to the trust property devolved on him without any conveyance.The learned Judge has held that the operation of section 113 (1) islimited to cases where the creator of the trust or the beneficiaries havenothing to do with the appointment to the office concerned. Thislimitation finds no support in the Ordinance or elsewhere and is arbitraryand unwarranted. The learned Judge further held that section 113 (2)applied and that a memorandum in writing notarially executed ascontemplated by sub-section (3) was necessary to vest the property.It is submitted that sub-section (1) deals with the appointment of trusteesby reference to office and sub-section (2) of trustees qua trustees. Sub-section (1) and not (2) would therefore apply to the present case. Theprinciple underlying them is an extension of that underlying the Ordinancefor the Prevention of Frauds. It is necessary that there should be nodoubt as to the identity of a trustee to prevent impostors from claiming.Where the appointment is made by reference to office it is clear enoughbut where the appointment is of trustees qua trustees there is room forraising disputes. Hence the requirement of a notarially executedmemorandum of appointment. In any event the learned Judge hasmisdirected himself in not going on to consider whether sub-section (1)also did not apply once he had decided that sub-section (2) applied. Itis to be noted that sub-section (1) was enacted by Ordinance 9 of 1915as an amendment to the Trusts Ordinance 1871 and at that time therewas no provision corresponding to sub-section (2). In the case ofMuttiahpillai v. Sanmugam Chetty 1 it was held that the Trusts Ordinanceapplied to private trusts as well as to public trusts. As regards theland described in schedule B plaintiff’s position was that it formed partof the Pirivena premises after its purchase by Rev. Mabatouwana andthat the Trust has prescribed to it. Reference may also be made to thecase of Masson v. Mathes 2 where it was held that in the case of religioustrusts of this nature even a de facto trustee may sue.
N. Nadarajah, K.C. (with him H. W. Jayewardene),for the 1st defendant,respondent.—Whatever may be the nature of the trusts disclosed by thedeeds P 1 and P 2a the plaintiff claims to hold the lands in trust forthe 2nd to 14th defendants who are members of the Vidyadara Sabha.This is clearly a trust for a private association and falls within sub-section(2). A memorandum of appointment notarially executed was necessaryfor vesting the trust property. It is admitted that such a memorandumdoes not exist.
(1910) 14 N. L. R. 15.
(193S) 40 N. L. R. 562.
ICETCrNTTMAN" S.P.J.—Piyaratana Thero v. Dhammananda Thero.
539
The provision now found in section 113 (1) was first enacted byOrdinance 9 of 1915 in consequence of the decision in Van Reethv. de Silva *. It was re-enacted along with sub-section (2) in thepresent Trusts Ordinance. The Objects and Reasons are to befound in the Government Gazette of August 25, 1916, and are instructive.It is stated, “ The first part of section 113 re-enacts Ordinance 9 of 1915which was recently passed as a special enactment. The second part ofthis section should prove of some use to religious societies which haveproperty vested in trustees. Such societies seldom take the trouble tosee to the execution of the necessary conveyance on a change of trusteesClearly therefore sub-section (2) was enacted tQ catch up cases like thepresent. Muttiapillai v. Sanmugam Ghetty {supra) was decided before theTrusts Ordinance was amended by Ordinance No. 9 of 1915 and is notan authority applicable to the provision under discussion. Section 113 (1)will apply in cases where a person like the Archbishop of Colombo who isappointed from Rome and with whose appointment the parties to a trusthave no concern is declared trustee. In this case the deed of trust itselfcontemplates the appointment of the principal by the Vidyadara Sabhawho are the beneficiaries. Indeed inasmuch as they contributed part ofthe consideration for the transfer they are also authors of the trust. Sincethe deed provides for a principal appointed by the Sabha being trusteethere is a method for the appointment of a trustee prescribed as contem-plated by section 113 (2). Alternatively the method followed in practiceshould be regarded as the customary method. The deed really and infact makes provision for the appointment of a trustee by the Sabhaand the fact that the word ‘‘Principal” is used cannot affect the matter.Further, even if this case is thought prima facie to fall within section 113(1), sub-section (1) is a general provision and sub-section (2) is anexception to it which is specially applicable to the facts of this case andshould therefore be followed.
E. B. WUcramanayake, for the other defendants-respondents exceptthe sixth.
R.L. Pereira, K.C., in reply.—Sub-section (1)deals with the appointmentof trustees by reference to office; sub-section (2) with the appointmentof trustees qua trustees. It cannot be said that one is general and theother special.
Cur. adv. wit.
October 25, 1946. Ketesteman S.P.J.—
In this case a large number of issues were framed but, at the suggestionof counsel for the 1st defendant, issues 19, 20 and 21 were tried as prelimi-nary matters.
The issues in question are as follows :—
Was the plaintiff appointed lawful trustee according to the
requirements of the Trust Ordinance of 1918 ?
Is the plaintiff vested with the properties in Schedules A and B ?
If issues 19 and 20 or either of them are answered against the
plaintiff, can plaintiff maintain this action ?
» {1903) 8 N. L. R. 97.
4540 KEUKEMAN S.P.J.—Piyaratana Thero v. Dhammcmanda Thero.
It was agreed that these three issues should be tried “ on the assumptionbut without conceding the truth of the allegations in the plaint ”,
The District Judge decided these issues against the plaintiff anddismissed his action with costs payable to the 1st defendant.
In his plaint the plaintiff alleged that thirteen persons on or aboutDecember 6,1873, formed themselves into an association called VidyadharaSdbha. The chief object of the Sabha was to obtain a portion of land inColombo and to establish a Pirivena thereon for the purpose of teachingBuddhism. Certain agreements by the said persons were then set out,including the agreement that the right of appointment of the Principaland teachers of the said Pirivena should be with the Sabha. The modeof appointment of future members was to be prescribed by the Sabha,the membership being restricted to thirteen persons. Provision wasalso made for the filling of vacancies among the thirteen persons by reasonof their death. I may add that the agreement in question was embodiedin document P 1—No. 925 of December 6, 1873.
The Sabha collected money and constructed a building for the Pirivena,and established the Vidyodaya Pirivena, and about 1873 appointedthe Venerable Hikkaduwe Sri Sumangala Nayaka Thero as the Principal.By deed No. 1,259 dated March 9, 1876 (P 2a) one of the thirteen persons,who was the owner of the premises on which the Pirivena was built, infurtherance of the common object transferred the premises in Schedule Aof the plaint to the Venerable Hikkaduwe Sri Sumangala Nayaka Theroand to his successors in the office of Principal.
The actual deed took the form of a gift and assignment to the priest Ihave mentioned and “ on his demise to the Principals appointed to thePirivena ” by the thirteen persons, “ and on their death by the gentlemen”who joined the Sabha. The gift was “ by way of a dedication absoluteand irrevocable and as Sanghika property”.
The plaint further alleged that the Sabha made arrangements toacquire the adjoining premises—described in Schedule B of the plaint—for the Vidyodaya Pirivena, and that these premises were transferredby deed No. 2,134 dated April 4, 1884 (P 3). This deed took the formof a plain transfer to the Rev. Mabotuvana Siddharta Thero, but theplaint alleged that he held the legal title in trust for the members of theSabha.
It was further alleged that certain buildings had been erected on thesepremises. It was also stated that on the death of each Principal hissuccessor was appointed by the Sabha, the last Principal appointedbeing the plaintiff.
The plaint finally alleged that the 1st defendant about December, 1941,wrongfully and unlawfully entered into occupation of a portion of thepremises.
The plaintiff prayed in ter alia for a declaration that he held the premisesin question in trust for and as trustee of the 2nd to the 14th defendantsas members of the Sabha, and for ejectment of the 1st defendant fromthe premises.
The argument addressed to the District Judge and in appeal by the1st defendant was that the plaintiff had not been duly appointed trustee
KEUNEMAN S.P.J.—Piyaratana Thero v. Dhammananda Thero.
541
within the terms of section 113 of the Trusts Ordinance {Cap. 72). Itwas contended that the case did not fall within section 113 (1), whichruns as follows :—
“Where, whether before or after the commencement of this Ordinance,it is declared or intended in any instrument of trust that the trusteeshall be the person for the time being …. holding or actingin any office or discharging any duty in any public or private institu-tion …. the title to the trust property shall devolve fromtime to time upon the person for the time being holding or acting in anysuch office, or discharging such duty, without any conveyance, vestingorder, or other assurance otherwise necessary .for vesting the propertyin such person.”
It seems clear that the language used is wide enough to cover thepresent case, at any rate as far as the premises in Schedule A are concerned.The deed P 2a grants the legal estate to the Venerable Sumangala NayakeThero, Principal of the said Pirivena, and on his demise to the Principalsappointed by the Sabha. On the plain terms of the sub-section the legaltitle should devolve upon “ the person for the time being holding ….that office ” without the need of any conveyance, vesting order or otherassurance.
It has been argued before us that this sub-section does not applywhere the appointment to the office is made by the author of the trust or,as in this case, by the persons who are alleged in the plaint to be thebeneficiaries. No authority has been cited in support of this contention,and we are unable to import such a meaning into the sub-section. In ouropinion section 113 (1) applies to the present case, so far as the deed P 2ais concerned.
The deed P 3 does not raise the present point. The plaintiff no doubt■will have to establish his contention with regard to the land in Schedule B.But that is a matter of evidence, and the preliminary objection raiseddoes not apply to these premises.
The 1st defendant further argues that section 113 (2) and (3) apply tothe present case, and contends that these sub-sections, if applicable,exclude the operation of section 113 (1). I have doubts whether thelast part of the argument is good, but I do not think it is necessary todecide the point and shall merely determine the question whether sub-sections (2) and (3) are applicable to this case.
The relevant portions of the sub-sections are as follows :—
113 (2)—“ Where, whether before or after the commencement ofthis Ordinance, in the case of any charitable trust, or in the case ofany trust for the purpose of any public or private association (notbeing an association for the purpose of gain) a method for the appoint-ment of new trustees is prescribed in the instrument of trust ….or by any rule in force, or in the absence of any such prescribed methodis established by custom, then upon any new trustee being appointedin accordance with such prescribed or customary method, and uponthe execution of a memorandum referred to in the next succeedingsub-section, the trust property shall become vested without' anyconveyance, vesting order, or other assurance in such new trustee ..
tl
642
Jdurugesu v. ThambipUlai.
113 (3)—“ Every appointment under the last preceding sub-sectionshall be made to appear by a memorandum under the hand ofthe person presiding at the meeting or other proceeding at which theappointment was made, and attested by two other persons present atthe said meeting or proceeding. Every such memorandum shall benotarially executed.”
It was argued in this case that a method for the appointment of newtrustees was prescribed in the instrument of trust, or in the alternativewas established by custom in this case. I do not agree with this conten-tion which is based upon a misconception. Nowhere in the documentP 2a is there any mention of the appointment of trustees. On thecontrary the trustees are declared to be the Principals appointed by theSabha. There is no doubt reference to the method of appointment ofthe Principals. But that is an entirely different matter. The considera-tions which may influence the Sabha to appoint a Principal are notnecessarily the same as they would take into account in appointing atrustee. Further, the reference to the method of appointment of thePrincipals are at the most words of description put in in order to givegreater clarity to the term “ Principal ”, The method of appointmentof the Principal is laid down in document P 1, and has only been referredto in document P 2a to indicate the kind of “ Principal ” that is meant.I do not think the sub-sections (2) and (3) apply to the present case. Imay add that the document P 3 is not affected by the argument of the1st defendant, for reasons already mentioned.
Counsel for the 1st defendant further argued that the prayer of theplaint was incorrect, inasmuch as the members of the Sabha are not thebeneficiaries, and that the trust is in reality a charitable trust. Thismay be a matter for investigation in the District Court and may affectthe decree which the plaintiff may obtain, but it has no bearing on thepresent argument.
In the circumstances I hold that as regards the matters raised underissues 19, 20 and 21 there is no bar to the maintenance of the presentaction. I set aside the judgment of the District Judge and send the caseback for the determination of the other issues in the case. The plaintiffwill have the costs of appeal and of the inquiry in the District Court.
JAYXTTLEKE J.—I agree.
Appeal allowed-