046-NLR-NLR-V-77-S.-M.-J.-FERNANDES-Appellant-and-W.-R.-S.-PERERA-and-another-Respondents.pdf
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AXLES, A.C.J.—Fernandes v. Perera
Present : Alles, A.C.J., Vythialingam, J. and Walpita, J.
S. M. J. FERNANDES, Appellant, and W. R. S. PERERA andanother, Respondents
S. C. 57/67 (F)—D. C. Colombo, 10113/L
Rent Restriction Act—Sale' of the rented premises—Refusal by the
tenant to attorn to the new owner—Remedy of the nexo owner—
Evidence Ordinance, s. 116.
When a person purchases premises which are subject to theprovisions of the. Rent Restriction Act, and the tenant who is inoccupation of the premises refuses to accept the purchaser as hisnew landlord on the alleged ground that the rents are payable toa third party, the remedy of the purchaser is to sue the tenant onthe contract of tenancy and not by way of a vindicatory action.
The 1st defendant was the tenant of certain “ excepted ” premisesand had been paying the rents to the 2nd defendant at the requestof the landlord. After the death of the landlord, the plaintiffpurchased the premises, with the sanction of the Court, from theadministrator of the deceased landlord. When the plaintiff’s proctorwrote to the 1st defendant requesting him to attorn to the plaintiffand pay rents to him, the 1st defendant replied that he had been thetenant .of the 2nd defendant for the previous 18 years and wantedthe plaintiff to obtain a letter from the 2nd defendant to pay rentsto the plaintiff and that, unless this was done, he could not attornto the plaintiff. At no stage did the 1st defendant seek to terminatethe tenancy. He was in occupation of the premises and was willingto fulfil his obligations as a tenant to whomsoever was legally hislandlord.
In the present action the plaintiff sought a declaration of title tothe premises and the ejectment of the two defendants from thepremises. The trial Court gave judgment in favour of the plaintiff,holding that the 2nd defendant who claimed the property on averbal gift from the deceased landlord was a trespasser and that, the1st defendant, by denying the title of the plaintiff, forfeited theprotection of the Rent Restriction Act.
Held, applying the ratio decidendi in David Silva v. Mudanayake(69 N. L. R. 396), that the 1st defendant had attorned to the plaintiffand could only be ejected if there was a breach of any of theconditions laid down in the Rent Restriction Act. The plaintiff’saction in the present case was therefore misconceived and he couldnot eject the 1st defendant in a vindicatory action.
A.PPEAL from a judgment of the District Court, Colombo.
C. Ranganathan, with A. Sivagurunathan, for the 1st defendant-appellant.
W. Subasinghe, for the respondents.
Cur. adv. vult.
June 17, 1974. Axles, A.C.J.—
The plaintiff instituted this action against the two defendantsin 1963 for a declaration of title to premises No. 107, ParakramaRoad, Peliyagoda, for ejectment of the two defendants from thesaid premises, and for recovery of damages. The plaintiff
ALX.ES, A.C.J.—Fernandes v. Perera
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became the purchaser of these premises in April 1961 whenSamarabandu Perera, the Administrator of the Estate of BaronPerera, whose estate was being administered in Testamentaryproceedings D.C. Colombo 15330/T obtained permission of Courtto sell the property. The sale was confirmed on 7th September,1962, and Deed of Transfer No. 1279, whereby he became theowner, was executed on 20th September, 1962.
The 1st defendant, who is the appellant in this case had beenthe tenant of Baron Perera since 1945. It is not in dispute thatsince 1947 the 1st defendant, at the request of Baron Perera, paidthe rents to the 2nd defendant, who was an illegitimate son ofBaron Perera and the learned District Judge has held that the2nd defendant was the agent of Baron Perera until the date of thelatter’s death on 3rd November, 1952. After 1952 the 1st defendantcontinued to make payments to the 2nd defendant and in 1959the 2nd defendant had sued the 1st defendant in D.C. Colombo46795/M for arrears of rent from February 1958 (P7). The casewas settled on 20th May 1960 and decree entered in favour ofthe 2nd defendant, whereby the 1st defendant agreed to pay-ment of rent from 1st May 1960 to the 2nd defendant. The decreehowever added that “ in the event of the defendant being suedby the legal heirs of Baron Perera, the plaintiff agrees toindemnify the defendant” (1D15). Prior to the date of decreeon 18th May, 1959, the 1st defendant deposited to the credit ofthe Testamentary Case a sum of Rs. 305/94, being the balancerent due from him after deducting the cost of essential repairs.According to 1D4 of 25th April 1960 the 1st defendant lookedupon the 2nd defendant as the Administrator of Baron Perera’sestate and continued to pay his rent to the credit of the Testa-mentary Case. In March, 1962, the 1st defendant became awarethat the plaintiff had bought the property and wrote to himwhether he was to forward the rent to him (ID 16). He followedup this query with a second letter (1D17) dated 9th April, 1962.By 1D19 of 21st May 1962 the plaintiff’s proctor wrote to the-1st defendant requesting him to remit the rents from January1962 to the plaintiff, since the latter had purchased the propertyin December, 1961. Thereafter until the end of 1962 the plaintiff’sproctor wrote to the 1st defendant requesting him to attorn tothe plaintiff and pay rents to him.
The 1st defendant appears to have been in a difficulty notknowing to whom he had to pay his rent. He was apparentlynot interested in the Testamentary proceedings and was onlyanxious to continue to be in occupation of the premises and payrents to whomsoever was legally entitled to it. Finally by ID23-
A 08589 (74/8)
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ALLES, A.C.J.—Fernandes v. Perera
of 14th December, 1962, his proctor wrote to the plaintiff’s proctorthat he had been the tenant of the 2nd defendant for the last18 years and wanted the plaintiff to obtain a letter from the2nd defendant to pay rent to the plaintiff and that unless thiswas done he could not attorn to the plaintiff. It will be notedthat at no stage did the 1st defendant seek to terminate thetenancy. He was in occupation of the premises and was willingto fulfil his obligations as a tenant to whomsoever was legallyhis landlord.
In giving judgment in favour of the plaintiff, the learnedJudge has held that the 1st defendant as tenant has supportedthe case of the trespasser, the 2nd defendant, who claimed theproperty on a verbal gift from Baron Perera, and that by denyingthe title of the plaintiff he has forfeited the protection of theRent Restriction Act, the premises in question being exceptedpremises under the provisions of the Act.
Learned Counsel for the appellant submitted, that when alandlord sells a property, even if the tenant refuses to attornto the purchaser, but continues in occupation, the contract oftenancy is not terminated. The only relief to which the newlandlord is entitled in such a case is not to bring a vindicatoryaction but an action on the contract of tenancy and he can onlysucceed in such an action if the tenant contravenes any of theprovisions of the Rent Restriction Act. In support Mr.Ranganathan relied on the judgment of Samerawickrame, J. inDavid Silva v. Mudanayake1 69 N.L.R. 396. This judgment wasdelivered in 1967 subsequent to the order of the learned DistrictJudge in this case.
In David Silva v. Mudanayake the premises in question hadbeen let to David Silva by Mudaliyar Mudanayaka in 1947. In1957 / Mudaliyar Mudanayaka transferred the premises in suitto his son, the plaintiff, and it was the submission of Counselfor David Silva that his client had not become the tenant ofthe plaintiff upon the transfer by Mudaliyar Mudanayaka,because it was the tenant who had the option of continuingthe tenancy and if the tenant was unwilling to be the tenantof the purchaser, the latter did not become the landlord.Samerawickrame, J. considered the rights of parties upon thesale or transfer of premises that have been let. After consideringthe Roman Law on the subject and its extension under theRoman Dutch Law Samerawickrame, J. summarised the legalposition in the following passage at pp. 398 and 399. i
i (1967) 69 N. L. It. 396.
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“ It would appear, therefore, that a purchaser of propertythat had been let was bound by the lease and had to permitthe lessee to continue in occupation till the end of the termof the lease. The purchaser may of course, as against hisvendor, insist on vacant possession or, in the alternative,claim rescission of the sale, but if he desires to abide by thesale, he can only take possession along with the lessee inoccupation if the latter chooses to continue with the lease.The lessee had the option of cancelling or surrendering thelease and pursuing his remedy upon his contract againsthis landlord or of retaining occupation of the property interms of his lease against the purchaser. But in the eventof his pursuing the latter course, he was under an obligationto pay rent to the purchaser and it appears to me also toperform all the other obligations due by him as tenant tohis landlord. The option of privilege that the tenant had todecide whether he would become a tenant of the purchaserconsisted in this, that it was open to him to cancel orsurrender the lease if he did not desire to become a tenantof the purchaser. Where he chose to continue in possessionas tenant of the premises, it does not appear to me that hehad any right to refuse to pay rent or to fulfil the otherobligations of a tenant to the purchaser. ”
The learned Judge also cited two previous decisions of thisCourt in support of the above proposition. In De Alwis v. Perera152 N.L.R. 433 at 445 Gratiaen, J. stated that “ it would seem thata tenant who remains in occupation with notice of the purchaser’selection to recognise him as a tenant may legitimately beregarded as having attorned to the purchaser so as to establishprivity of contract between them ”. In Silva v. Muniamma ’ 56
N.L.R. 357 Sansoni, J. stated “ that when a landlord sells premiseswhich have been rented the purchaser steps into the landlord’sshoes and is entitled to claim the rent from the tenant. It is notincumbent on the tenant to remain in possession if he does notwish to acknowledge the vendee as his landlord. He is quiteentitled to give up the tenancy and quit the premises but so longas he remains in possession he must pay the rent to his newlandlord, that is the vendee
Mr. Ranganathan submits that in the light of these authorities,if the tenant is in occupation of the leased premises he becomesthe tenant of the new purchaser by operation of law. The tenantin such a case is not a trespasser and even if he seeks to denythe title of his landlord—which he is estopped from denyingunder the provisions of section 116 of the Evidence Act—it does
1 (1951) 52 N. L. R. 433 at 445.
(1955) 5G N. L. R. 357.
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Parer a v. The Stale
not affect the contract of tenancy so long as he continues to bein occupation and is willing to pay his rent. I have detailed theevidence in this case in regard to the relation between theplaintiff and the 1st defendant to indicate that the 1st defendantwas in occupation of the premises, that he never sought toterminate the tenancy and was always willing to pay his rent.His difficulty arose in regard to the payment of rent to the correctperson in view of the conflicting claims of the 2nd defendantand the plaintiff who both claimed to be the landlord of thepremises. Counsel for the plaintiff cited a passage from Voet19.2.19 (Berwick’s translation) in support of the issue that the1st defendant was a trespasser. This passage does not howeversupport his submission. This same passage has been cited bySamerawickrame, J. in David Silva v. Mudanayake when hedealt with the Roman Dutch Law on the subject. Thereforeapplying the ratio decidendi in David Silva v. Mudanayake thedefendant had attorned to the plaintiff and could only be ejectedunder a properly constituted tenancy action if there was a breachof any of the conditions laid down in the Rent Restriction Act.
The plaintiff’s action in this case is therefore misconceived andhe could not eject the 1st defendant in a vindicatory action. IssueNo. 5 should have been answered in favour of the 1st defendantand the plaintiff’s action dismissed. We therefore allow the 1stdefendant’s appeal with costs payable to him by the plaintiff-respondent.
Vythialingam, J.—I agree.
Walpita, J.—I agree.
Appeal allowed.