SAMEED AND ANOTHER v. CEYLON HOTELS LTD

005-SLLR-SLLR-1989-V-1-SAMEED-AND-ANOTHER-v.-CEYLON-HOTELS-LTD.pdf


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Sameen and Another v. Ceylon Hotels Ltd. (Palakidnar. J.)
81
SAMEEN AND ANOTHER
V.
CEYLON HOTELS LTD.
COURT OF APPEAL •
DHEERARATNE. J. (PRESIDENT C/A) and PALAKIDNAR. J.
A. 567/79 (F)
C. COLOMBO 3030/REMAY 3. 4. 5. and 6. 1988.
Landlord and tenant — Description of agreement as a licence. — Ingredients of atenancy .— Requirements o f licence.
A contract of tenancy is featured by an object to let and hire, ascertainedpremises and fixed rent. In the last resort it is a question of intention. The meredescription of an agreement as a .licence will not , make it one. Was only, apersonal privilege intended ?
The fact'that there was no exclusiveness of possession of the area occupied inthat the owner Could change its location the prohibition against assignment ofthe benefits without written consent, the provision for termination at 24 hoursnotice for any breach of.conditions in the agreement, the.stringent nature of thecontrol and’Supervision implied-in the provision and the limited duration of theoccupancy, show that the occupancy was of a personal nature and a licence.
82
Sri Lanka Law Reports .
ft989/ 1 Sri L. R.
Cases referred to :
. 1.• Addis Combo Estates Ltd. v. Crabbe 11957] 3 All E.R. 563
Booker v. Palmer [ 1 942] 2 All E.R. 676
Errington v. Errington and Woods [1952] K.B. 290
Street v. Mountford [ 1 985] 2 All E.R. 289
Radaich v. Smith 101 C.L.R. (Australia) 209. 218
Hadjiloueas v. Crean 1987 3 A.E.R. 1008
Sivagnanda v. Bishop of Kandy 55 NLR 1 30
Ratnam v. Perera 64 NLR 1 98.
APPEAL from judgment of the District Court of Colombo.
Dr. H.W. Jayewardene. Q.C. with Ifthikar Hussain. Harsha Gunasekera and MissKeenawinna for Appellants.
H.L. de Silva, P.C. with G. Dayasiri and L.N. de Silva for Respondents.
Cur. adv. vult.
July 27. 1988-
PALAKIDNAR. J.
The two Plaintiffs-Appellants-entered into an agreement withthe Defendant Hotel to display and sell gems.' jewellery andcurios to customers-and visitors of the Hotel -in a defined area.shown .as premises number 7 in the sketch marked P1 at thetrial.
The Plaintiffs were to pay licence fees of Rs. 3500/- a month.The tenure of such business was two-years commencing from1-9 76.
On 28-9-78 after the expiry of the two year term the Plaintiffsinstituted this-acti.on for a-declaration, that the_agreemenf was of- no force or avail in law and.a further declaration that they weretenants of the Defendant'Hotel. The only issue raised at the trial.was ' whether, the Plaintiffs'-were tenants .of the premises in■’ suit •?■’■ ’-
The learned trail Judge after a. careful evaluation ,of the-evidence Jed-has . held that the Plaintiffs were-not tenants. Heobserved-that the Plaintiffs did not show that the premises weregoverned by the. Rent Act.‘
. The Plaintiffs in -asking Tor-a declaration that the .agreementmarked P-2 was of.no force or avail in law on the footing that itviolates section: 2 of the Prevention of Frauds Ordinance have.according .to. the finding ..of the learned trial Judge becometrespassers because an-informal lease cannot create a monthlytenancy unless it is no.tarially-executed-.
83
CA. Sameen and Another v. Ceylon Hotels Ltd. '{Palakidnar. Jr)
It Was the contention of the Counsel' for the Appellants thatalthough the agreement termed' the occupation as a licence andthe rent licensee fees the features'of the actual relationship thatsubsisted between the Plaintiffs and the Defendant were that.oflandlord and,tenant as governed by the Roman. Dutch Law oflocatio condiicti. It was featured by an object to .let. and hire,ascertained premise's and fixed rent…
In this background authorities that .have drawn' the distinctionbetween licensees and tenants were submitted. The case ofAddis Combo Estates Ltd. v. Crabbe (1) was considered. Itenunciated the principle that the relationship was determined bylaw and not by description given by the parties. The view of Lord.Green M.R. in Booker v. Palmer (2) referred to by the learned trialJudge was that the' question whether or not the parties to anagreement intend to create as between themselves therelationship of landlord and tenant must ini the last resort be aquestion of intention.
The relevant view of Denning C.J. in Errington v. Errington andWoods (3) was also urged by Counsel at.the argument in-appeal.'
Although a person who. is let into exclusive possession is
prima facie considered.to be a tenant nevertheless he wil.lnot'be held to. be.' so if. the circumstances – negative any
intention to. create a tenancy. Words alone may: not-suffice..Parties cannot form a-tenancy into a licence by merely bycalling it one. But if the circumstances and. conduct of the "
> parties show-that all that.was intended was -the occupiershould' be granted a-personal privilege-with no interest inland he will be held to be .a licensee only. "
The exjclusive possession of premises number .7 in sketch P1.was.strpngly relied ..on by,'Appellants' Counsel as a feature of thetenancy agreement. But the clauses – in the'agreement revealaspects which erode into the exclusiveness of the possessionitself. The Plaintiffs could display itenhs.which were referred to inclause 1 2 and onlyduring hours named by the Company. Clause18 permits a control of the staff by the Defendant. There is afurther 'right given to. the' Defendant to move the Plaintiffsbusines.s.:to any other part of the shopping area.
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The object of letting and hiring the premises cannot beinferred from the agreement. The agreement shows that theobject was to provide amenities and facilities to customers andvisitors to the Hotel. The right granted is a purely personal one.There is a prohibition in the agreement against assigning theentire benefits or any one of them under clause- 5 without theprevious consent in writing by the Defendant : The agreementitself was terminable by the Defendant-Company at twenty fourhours' notice for any breach (clause 6) of a condition in whichthere was agreement between the parties.
In the case of Street v. Moontford (4) it was held that a tenancyarose whenever there was a grant of exclusive possession for afixed periodic term at a stated rent unless special circumstancesexisted which negatived a presumption-of tenancy. Vide LordTempieman's speech. He quoted Lord Green's view referred toearlier in this judgment. He also referred to Lord Denning's viewin Errington v. Erringtoh also quoted earlier in this judgment. Itemphasised that there should be exceptional circumstances tonegative.a tenancy clearly inferred from the express agreementbetween the parties.
In Radaich v. Smith (5) it was held, by Taylor,. J. at page 218 thatthe test of exclusive possession in deciding a tenancy could give'r+se to' misgivings because it may not correspond to realities —In the same judgment .Windayer, J. at page 222 considered thedistinction by stating that the funda.mental'right which a'tenanthas that- distinguishes him from the position of a licensee is. aninterest in land and distinct from a personal- permission to enterthe premises and use it for some stipulated purpose.
In the recent case of Hadjiloueas v. Crean (6) these authoritieshave been, reviewed with special reference to Lord Tempieman'sviews .in Street v. Mountford (Supra). Lord Justice Mustill quotedthus •.•.
Exclusive possession is.of first- importance in consideringwhether an occupier is a tenant, exclusive possession is notdecisive because an. .occupier who enjoys exclusivepossession is not necessarily a tenant. " —.page 1020. – •
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Sameen and Another v. Ceylon Hotels Ltd (Pa/akidnar. J.j.
85
Local cases pertaining, to the subject under discussion werealso cited by Counsel for the Appellants, In the case' ofSivagnanda v. Bishop of Kandy (7) the position of. the claim oftenancy by the occupancy of a prospective purchaser of the landwas examined and it was held based on the facts that he was alicensee. In the case of Ratnam v. Perera (8) it was held that mereuse of words in an agreement could not determine the natureand quality of the rights.
In the present case the. conclusions of the trial Judge in. thejudgment appealed from are unexceptionable. He has consideredthe object of the agreement and in- our view a parallel can bedrawn to the front.house of a theatre or a stall in a railway stationwhere refreshments are.served to the facilitjes'that the Defendantsought to provide its customers and visitors. >
The stringent nature, of the control and supervision implied inthe provisions of the agreement makes it clear that "'the-occupancy of the Plaintiffs was of a personal nature which couldnot be assigned to anyone and: limited in duration. It certainly didnot convey any interest in the land.
Therefore' the conclusion arrived at by the' learned trial 'Judgeis in our view correct' and he has answered the issue inaccordance with the law and the facts of this c.ase.
We see no reason to interfere with the decision of the learnedJudge in the circumstances and dismiss the appeal with costsfixed at Rs. 525.
Dheeraratne, J;, I agree.
Appeal dismissed.
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Sri Lanka Law Reports
1198911 Sn L. R.
DAYA WETHTHASINGHEV.
MALA RANAWAKA
COURT OF APPEAL ‘
WIJETUNGA J. AND S.N. SILVA J.
A. APPLICATION 181/88.
C. MT. LAVINIA 2478/RE.
MARCH 29 AND 30. 1988.
Civil Procedure — Transfer of Case — Judicature Act, No. 2 of 1978. S. 46 —Bias— Expediency — Stay-Order Made per incunam.
In a tenancy case the main dispute was whether the premises let wereresidential premises or business premises and whether they were exceptedpremises. During the hearing the Judge suggested a settlement but differenceson the quantum of rent the defendant should pay stalled the settlement. Aninspection was suggested and made .by the Court. The Judge noted oninspection that it was incontrovertible that the premises were not being used atall as a residence and further.observed that the rental of Rs. 20.000 per month, demanded by-the-plaintiff (against Rs. 5000 offered by the defendant) was. reasonable. The case could not be settled and the defendants applied' for atransfer of the case to another Judge in the interests of a fair and impartial trialOn the application being supported order was made staying further proceedingsuntil the day after the notice returnable date. The plaintiff filed objections andsubmitted that the stay order had been made per incunam.
Held :
The stay order was not one made per incuriam. It .had not been made in
ignorance of any previous decisions of the Court or of a court of co-ordinate orhigher jurisdiction or in ignorance of a statute or a long standing rule of thecommon law. .. '‘
' A party seeking to establish bias'undertakes a heavy burden of proof. Merereasonable, suspicion is not'enough. A Judicial officer is a person with a legallytrained mind and court will i not lightly entertain an allegation of bias. Thepetitioner had failed to establish bias.
■'3. Is the transfer expedient on any other ground ? In view of the Judge's notethat it was incontrovertible that the premises were not being used at all as aresidence of- the defendant.- the credibility of the defendant would be affected.Expedient means ' advisable in the interests-of Justice '. In view of the Judge'sobservation which certainly affects the credibility of the defendant — petitioner,the interests of Justice demand that the case be heard by another Judge.
87
CADaya Weththasinghe v: Ma/aRana.ivaka./Wijetunga. J.)
Cases referred to
Billimoria v. Minister of kand' 978-79]"1 Sri L R 10
Pererav.HasheebSriskantkaVdl;] p. 133. 145 ‘
Simon v. The Commissioner of National Housing 75 NLR 471
Re Ratnagopal 70 NLR 409,
Jinasena v. Commercial Invesment and Finance Co. Ltd: [1985] 1 Sri L R238 ;
Application for transfer of case in terms of section 46 of the Judicature Act.
Fan Mustapha P.C. with S. Mahenthiran, M.S.M. .Suhaid and H. Vitanachchi fordefendant—petitioner.•■
Miss Maureen Seneviratne P.C. with S.- Monelingam for plaintiff-respondent.
■Cur. adv. vult.
July 26. 1988 .
WIJETUIMGA, J.
This is an application by the'defendant-petitioner'for an orderdirecting that the above action of the'District Court of Mt. Laviniabe tried by another Judge or be transferred to any other court of.competent jurisdiction, in terms of section 4.6 of’the Judicature■Act.,
. The'petitioner avers that plaintiff-respondent instituted actionbearing No. 2222/RE in the District Court of Mt. Lavini'a on1 8.8.84 .against him, praying for. his eviction, .from premises'No. 40/1.. Ditekman'S' Road. Colombo 5 on the basis, that ,the saidpremises were . residential premises. The defendant-petitionerfifed answer in. the said cas.e on 29.4.85 and the plaintiff-respondent withdrew the said action. 4
Thereafter, the plaintiff-respondent j instituted the presentaction bearing No. 2478/RE in the District Court of fylt. Laviniaagainst the defendantrpetitioner on 18.1.86. praying for hiseviction from the said premises.'In the plaint it was averred interalia (i) that the Said premises had been assessed as, businesspremises from'■ October. 1 985 and constituted . ' exceptedpremises ' within the meaning of-the Rent Act. (ii) that thedefendant-petitioner had failed to quit and vacate the saidpremises upon being noticed to do.so by 31.1.86 and (iii) thatthe plaintiff-respondent estimated'the damages at Rs. 20.000pm..
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11989! 1 Sri L R.
The defendant-petitioner filed answer denying the allegationsin the,plaint and pleading that the said premises had originallybeen assessed as residential premises and that the purportedassessment as business premises was void as being in violationof Section 1 2 of the Rent Act. since the conversion was effectedwithout the permission of the Commissioner of National Housingand stating that the said premises w~s used for residentialpurposes.
' The case was taken up for trial on 26.1.88.
A number of issues were raised. The mother of the plaintiff-respondent was called as a witness and the examination-in-chiefof this witness commenced. Shortly after the examination-in-chief was resumed after the luncheon adjournment, the learnedAdditional District Judge suggested that it would be desirable ifsteps were taken to settle the case. Learned counsel for theplaintiff-respondent stated that though she was not in favour of asettlement, in deference to court she would put the suggestionmade by court to her client and after discussion with the pjaintiff-responde.nt informed court that the' plaintiff-respondent wasclaiming a minimum of Rs. 20.000 p.m. as rent. Counsel for thedefendant-petitioner stated that as a matter of adjustment thedefendant-petitioner was agreeable to pay a'monthly rental of Rs..5000. The learned Additional District Judge then observed thatthere was a wide disparity in the quantum of rental suggested bythe parties and inquired whether the parties would-consent to aninspection of the premises by court in order to fix the quantum ofrental. The parties agreed to such an inspection by way of asettlement.
Thereafter, the learned Additional District Judge visited thepremises. After the inspection the proceedings were re-.. commenced: The discussion relating to the rental was resumed■ and counsel for the defendant-petitioner indicated that he wasprepared to pay a little more than the sum of Rs. 5000suggested earlier. The plaintiff-respondent; however, was notagreeable to this suggestion. The court too stated that the rentalof Rs. 20>000 claimed by the piaintiff-respondent appeared to bereasonable. However; it. was not possible, to bring about asettlement and the case was refixed for trial on 8.3.88 and19.4.88.
CADaya Wethihasinghe v. Mala Ranawaka. (Wlfetunga, J.J89
The trial judge recorded his observations of the inspection in'the following terms :—
" The following incontrovertible facts which were pointed outby the plaintiff were evident from the inspection, viz.'—
1. These premises are being used as an office.
.2. Repairs have been effected to the premises. '
3. The premise's are not being used at all'as a residence ofthe defendant. ".
He further observed that although it can be accepted that thedefendant used the premises as. his professional office,-yet it didnot appear that the premise's were' used mainly for such a'purpose. In other words, it appeared that the premises weremainly used as a commercial establishment.
. The defendant-petitioner states that the parties agreed to'theinspection by the court' purely for the purpose of fixing a rental in-the event'of a settlement an,d'that the observations recorded bythe learned Additional District Judge on his own inititiativeconstituted a premature determination of the primary issue in thecase. In the circumstances, the defendant-petitioner apprehendsthat he would be prejudiced by the said observations and a fairand impartial trial cannot be had in the particular court'.. He,therefore, submits that it is. expedient that the case be transferredto another court.
He had also sought,an order staying further proceedings in the.said case until the final determination.of this application.
On 2.3.88 this application was supported in open court bylearned President's Counsel for the defendant-petitioner and thecourt made order that notice do issue on the respondent for24.3.88 arid . that the proceedings .be stayed . in terms ofparagraph (b) of the prayer to the petition till 25.3.88.
The plaintiff-respondent filed objections on 21.3.88 andmoved that the defendant-petitioner's application be dismissedand the stay order be not extended.
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Learned President's Counsel for the plaintiff-respondentcontended that notice and stay order had been granted by thecourt per incuriam as the learned trial judge had rightly recordedhis observations after the inspection and that this-was not aground on which the case can be taken out of his hands. Shefurther submitted that the observations are for the purpose ofdetermining the rent and if he did not so record his-observations.there would be a complaint of prejudice. As the material date forthe purposes of this case is October. 1985 when it was firstassessed as business premises, the recording of observations bythe judge in 1 988 does not decide the issue in -the case. It washer submission that in an application for transfer of a case such'as this, the onus of establishing sufficient grounds lies heavily onthe petitioner and such jurisdiction should be exercised withextreme caution.'.
On the other hand, learned President's Counsel for thedefendant-petitioner argued that in .view of the observationsrecorded by the trial judge, the law renders him incompetent tohear this case and he has disqualified himself from doing so. Hesubmitted that, the scope of the inspection was limited to thefixation of the quantum of rent-but the learned judge had over–stepped the mark and had proceeded to decide the substantiveissue in the case. Although he would have acted bona fide andno impropriety is'alleged, yet he cannot now assess the evidencein the case fairly in the light of' his observations. While thedefendant-petitioner had in his answer stated that the premisesin suit continue to be residential.premises, the judge has madethe observation that it is beyond controversy that the premisesare being used as an office and are not being used at all as aresidence of the defendant. It was his submission that the judge'sobservations in regard to user are not warranted, that being aquestion of fact and law.-The larger'interests of justice, therefore,demand that the case be sent before another judge.
. I shall now .deal with the submission that notice and stay orderhad been granted per incuriam. I. have already adverted to thematters that led to the making of the observations complained of.The.defendant-petitioner has, in his petition to this court, set-outthe circumstances relevant to the matterin' issue, supported by
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' Daya Weththasinghe v. Mala Ranawaka. (Wijetunga. J.J
91
his affidavit and has also annexed thereto a copy of the plaint-answer and the proceedings in the case. Thus, there wasavailable to this court at that stage, the material necessary for thedue consideration of the question of transfer. On the applicationbeing supported, we were satisfied that prima facie there was acase made out regarding the feasibility'of transfer, if not on theground that a fair and impartial trial cannot be had in theparticular court, at least on the basis that it is so' expedient onany'other ground.
In Billimoria v. Minister of Lands. (1). Samarakoon C.J. refers toa number of authorities oh what a decision per incurianri is.Applying ..those' principles to the instant case, I arh, unable topersuade myself that the court has acted in ignorance of. anyprevious decisions of this court or of.a court of co-ordinate orhigher jurisdiction or in ignorance of a statute or a; long standingrule of the common law.,
. As the trial in this case stood re-fixed for 8.3.88 and 1 9.4.88.it became necessary to stay .further, proceedings in’ the DistrictCourt, as otherwise the final order on this application could havebeen rendered nugatory! As was said in Billimoria's case (supra),the interests of justice required that a‘ stay orcier be made as aninterim measure1 ''
I am still of the view' that the order made , after dueconsideration by this court on-2.3.88 for issue of notice on theplaintiff-respondent and for-stay of proceedings ismot one madeper incuriam.-
This brings me to the main question viz. whether the facts andcircumstances of this case warrant its transfer. Can.it be said that,in view, of the observations, recorded by, the. judge. a fe't andimpartial trial cannot be had before him ? , No doubt theobservations are in, the nature, of very.strong findings of fact andhave been termed by the judge as incontrovertible. Yet. wouldthis- result in bias .on the part of the judge ? Even though noimpropriety is alleged;, the onus,of establishing bias lies heavilyon the petitioner. '•.•
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11989J 1 Sn L. R.
In Perera v. Hasheeb. (2) G.P.S. de Silva. J. made theobservation that it must be remembered that a judicial officer isone with a trained legal mind, that it is a serious matter to allegebias against a judicial officer and that this court would not lightlyentertain such an allegation.
In Simon v. The Commissioner of National Housing. (3) it hasbeen held that the inquiring officer must be .disinterested andunbiased, but a decision of his is not liable to be quashed on theground merely of th.e reasonable suspicion of the party aggrievedunless it is proved tha't there was a real likelihood that theinquiring, officer was biased .against the party aggrieved.
Again, in He RathagopaT, (4) the court held that the proper testto be applied is an objective one and formulated it as follows :Would a reasonable man; in all the circumstances of the case,believe that there was a real likelihood of the Commissionerbeing biased against him ?
These., authorities are indicative of the heavy burden that lieson the petitioner to establish bias'. Where-the person concernedis a trained judicial officer, the onus, to my mind is even greater.On a careful consideration of the facts arid circumstances of thiscase. I aim unable to'say that the defendant-petitioner hasdischarged this burden. His application for transfer of this case
on the ground that a fair and impartial trial cannot be had in the
particular court must, therefore,, fail. '
.. However, learned counsel for the defendant-petitioner alsorelied on the alternative ground viz. that it is so expedient on anyother g'round. In Perera m:Hasheeb (supra) jt has been held that■the expression■' expedient' in the context means advisable in theinterests:of justice.' ,.■
As’mentioned earlier, the judge has "come to certain strongfindings.in consequence oflhe inspection.-which he has termed' incontrovertible facts '. One such finding 'is that ■’ the premisesare-not being used at all as residence-of'the defendant'.
■ What is the de'fendant-petitioner’s position in regard to thisaspect of the matter ?'He categorically states inrhis answer thatthe premises in question continue to be. residential premises
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Day a Weththasinghe v. Mala Ranawaka. (Wijeiunga. J.j '' 93
■governed by the Rent Act No. 7 of 1 972. Ah issue too has been-raised in these very terms. If it is an ’ incontrovertible fact' that .
’ the premises are not being used at all' as a residence of the•defendant can it continue to be residential premises governed .by the Rent Act ?
It' has been held in Jinasena v. Commercial Investment andFinance Co- Ltd. (5) that although the. description given in theAssessment Register is relevant to determine, whether, thepremises are business premises or residential. premises andaffords prima facie evidence as to whether the'premises havebeen assessed' as residential or business premises, such-description is not conclusive bn the issue whether the premisesare business premises or residential premises.
. Residential,premises are premises for the time being occupiedwholly or mainly, for the purpose, of .residence and businesspremises mean any premises other than residential premises’. '
In that case, despite the description in the Assessment Register,that the premises were business premises, it was;held to beresidential premises on the basis that the premises wereoccupied mainlytfor residence.
. It is not disputed that the words * for the time being ' mean the. time at which the-action is instituted. In the instant case, the. action was instituted in February. 1 986. whereas the inspectiontook place in January, 1988. But. one cannot lose sight of thefact that the judge's findings certainly affect the credibility of thedefendant-petitioner:
In these circumstances. I am of the view that it would be in theinterests of justicethat this case be heard by another judge.
Therefore. I make order that the case be transferred to anyother judge of the District Court of Mt. Lavin.ia..
The defendant-petitioner will be-entitled to the .costs of thisapplication… ' –
S. N. SILVA, j;, – I agree
Application allowed. .