THE LAND COMMISSIONER, Appellant, and LADAMUTTU PILLAI and another, Respondent

041-NLR-NLR-V-62-THE-LAND-COMMISSIONER-Appellant-and-LADAMUTTU-PILLAI-and-another-Respondent.pdf


The Land Commissioner v. LadamiUlw Pillar
169
[In the Privy Council]
1960 Present: Lord Tucker, Lord Keith of Avonholm, Lord Jenkins,Lord Morris of Borth-y-Gest, Mr. L. M. D. de SilvaTHE LAND COMMISSIONER, Appellant, and LADAMUTTU PILL AIand another, RespondentsPrivy Council Appeal No. 39 of 1959S. C. 457—D. C. Colombo, 288[Z
Land Redemption Ordinance, No. 61 of 1942—Interpretation and scope of section 3—Land Commissioner—His liability to be sued—Effect of words “determinationshall be final ”—Certiorari—Land Acquisition Act, No. 9 of 1950—CivilProcedure Code, ss. 463, 464—Land Development Ordinance of 1935, s. 2.
Sub-sections 1 and 4 of section 3 of the Land Redemption Ordinance, No, filof 1942, prior to amending Ordinance No. 62 of 1947, were in the followingterms :—
“ 3.(1) Tho Land Commissioner is hereby authorised to acquire on
behalf of Government the whole or any part of any agricultural land, if theLand Commissioner is satisfied that that land was, at any time before orafter the date appointed under section 1, but not earlier than the first day ofJanuary, 1929, either,—
(а)sold in execution of a mortgage decree, or
(б)transferred by the owner of the land to any other person in
satisfaction or part satisfaction of a debt which was due fromthe owner to such other person and which was, immediatelyprior to such transfer, secured by a mortgage of the land.
(4) The question whether any land which the Land Commissioner isauthorised to acquire under sub-section (1) should or should not be acquiredshall, subject to any regulations made in that behalf, be determined by theLand Commissioner in the exercise of his individual judgment ; and everysuch determination of the Land Commissioner shall be final
Held, (i) that the words “ to any other person ” must be interpreted asincluding any other person or persons. The circumstance that as betweentwo transferees one took an undivided two-third share of tho land transferredand tho other an undivided one-third was not material. *
that in considoring the word “ debt ” as used in section 3 (1) (6) there, isno reason to exclude a debt due under a mortgage decree founded upon amortgage bond. Where a land is mortgaged and the mortgage is put in suitand decree is entered against the mortgagor for the payment of the amountdue on the mortgage bond, a subsequent voluntary conveyance by the mortgagorin favour of the mortgagee, the consideration for which is set off in full settle-ment of the amount due on the decree, is a transfer as contemplated insection 3 (1) {&).
that land transferred to two persons in satisfaction of debts due to onlyone of them does not fall within the purview of section 3 (1) (b).
that section 3 (1) (6) is applicable even to a case where the landstransferred are some only of the lands secured by mortgage.
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LORD MORRIS—The Land Commisaioizer v. Lodomuttu Pfflai
that the words “ every such determination shall be final ” in sub-section 4of section 3 cannot prevent the courts of law from inquiring whether anyparticular land is land which the Land Commissioner is authorised to acquireunder the provisions of sub-section 1.
that the Land Commissioner is not a Corporation Sole. If the authorityof a Land Commissioner to mako a determination under section 3 is challengedthe appropriate procedure is by way of an application for certiorari.
A.PPEAL from a judgment of the Supreme Court reported in(1958) 59 N. L. R. 313.
«
F. N. Gratiaen, Q.C., with Walter Jayawardene, for the appellant(Land Commissioner).
Sir Frank Soskice, Q.G., with Joseph Dean, for the substituted plaintiffrespondent.
Cur. adv. vult.
July 27, 1960.[Delivered by Loed Mourns of Boeth-y-Gest]—
This is an appeal from the Judgment of the Supreme Court of Ceylondated the 31st January, 1958. The Supreme Court by a majority(Basnayake, C.J. and Pulle, J., I£. D. de Silva, J. dissenting) allowed theappeal of the substituted plaintiff in the action from the Judgment andDecree of the District Court (L. B. de Silva, D.J.) dated the 13th Novem-ber, 1953, dismissing his action with costs. By their Judgment and Orderthe Supreme Court directed an injunction to issue in favour of the sub-stituted plaintiff restraining the defendants from taking steps underOrdinance No. 61 of 1942 to acquire certain land. One of the mainquestions raised in the appeal is whether upon a proper interpretationof the provisions of section 3 of that Ordinance (the Land RedemptionOrdinance) the Land Commissioner had the power to determine thatthe land in question should be acquired. Other questions in the appealraised issues relating to the procedure followed and the remedies sought.
The second respondent, who for convenience may be referred to asElaris, was formerly the owner of a number of different allotments ofland. One of these which consisted of several contiguous allotmentsamounting in total to approximately 42 acres in extent was known asKeeriyankalliya estate. It may be referred to as the Estate.
Elaris mortgaged this land (the Estate) and also other lands. On the30th September, 1925, by Mortgage Bond No. 391 (P.l) he mortgagedthe Estate together with certain other lands by a primary mortgage infavour of three mortgagees, one of whom was called Sockalingam, forRs. 50,000. Elaris bound himself to repay that sum to the mortgageesor any one of them on demand. The mortgagees were correal creditors.On the 8th April, 1930, by a further Mortgage Bond No. 533 (P.2) Elaris.mortgaged certain lands which included the Estate, in favour of fivemortgagees for Rs. 25,000. One of those mortgagees was Sockalingam :another w'as a man called Sekappa. On the 8th March, 1931, by a further
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Mortgage Bond, No. 2339, Elaris mortgaged certain lands which includedthe Estate in favour of a man called Dabarera for Rs. 20,000. It willbe seen that the Estate was common to all three mortgagees.
By a plaint dated the 31st January, 1933, Sockalingam instituted anaction (Case No. 7365) against Elaris in the District Court of Negomboand joined Dabarera as a second defendant. By his plaint Sockalingamput the secondary bond (P.2) in suit and set out the amount which wasowing by Elaris for principal and interest. Dabarera as the holder ofthe Mortgage created under Bond No. 2339, was made a party in order. that he should show cause why the mortgaged premises or any of themshould not be sold so as to effect the recovery of the amount owing.Sockalingam claimed judgment for the principal and interest due underthe Mortgage Bond (P.2) and, in default of payment, an order for thejudicial sale of the land comprised in the mortgage and for an orderthat, if such sale did not yield sufficient to pay the principal and interest,Elaris should pay the amount of the deficiency with interest.
On the 23rd June, 1933, a decree as asked for was entered in favourof Sockalingam : the sale of the land was to take place in default ofpayment within four months from the date of the decree.
By a Deed of Transfer No. 4010, dated the 4th May, 1935 (P.5),Elaris as vendor transferred the Estate and certain other lands toSockalingam and Selcappa : the transfer was in the proportion of anundivided two-third share to Sockalingam and an undivided one-thirdshare to Sekappa. The lands other than the Estate were some but notall of the other lands covered by the first and second mortgages. TheDeed recited that the transfer was in consideration of the sum ofRs. 75,000. The attestation clause, certified “that the full considerationabove-named was set off in full satisfaction of the claim and costs due inCase No. 7365 D. C. Negombo and the principal and interest due onmortgage bond No. 391 dated 30th September, 1925 …. and thatthe vendor undertook to release the lands appearing in this deed fromtertiary mortgage bond bearing No. 2339 dated 8th March, 1931.”
Thereafter in October, 1940, Sockalingam transferred an undividedone-third share of the land which he had acquired under the TransferDeed No. 4010 to the heirs of Muthiah (one of the correal creditors underMortgage P.2) : Sockalingam transferred his remaining one-third shareto Velayuthan (another of the correal creditors under Mortgage P.2).In 1945 by Deed No. 761 dated the 24th February, 1945, Sekappa,Velayuthan, and the heirs of Muthiah as vendors transferred the entireinterest in the Estate and the other lands which had been the subjectof Deed of Transfer No. 4010 : the transfer which was for a considerationof Rs. 75,000 was to Ladamuttu Pillai. He therefox’e became the soleowner of the Estate and of the other lands which have been referredto above.
On the 16th May, 1945, Elaris made a request to the Land Com-missioner to take action under the provisions of the Land RedemptionOrdinance, No. 61 of 1942.
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LORD MORRIS—'The Land Commissioner v. Ladamuttv. Pillai
Section 3 of that Ordinance was in the following terms :—
“3. (1) The Land Commissioner is hereby authorised to acquireon behalf of Government the whole or any part of any agriculturalland, if the Land Commissioner is satisfied that that land was, atany time before or after the date appointed under section 1, but notearlier than the first day of January, 1929, either—
(а)sold in execution of a mortgage decree, or
(б)transferred by the owner of the land to any other person in
satisfaction or part satisfaction of a debt which was due fromthe owner to such other person and which was, immediatelyprior to such transfer, secured by a mortgage of the land.
Every acquisition of land under sub-section (1) shall be effectedin accordance with the provisions of sub-seotion (5) and shall be paidfor out of funds provided for the purposes of this Ordinance undersection 4.
No land shall be acquired under sub-section (1) until the fundsnecessary for the purpose of such acquisition have been providedunder section 4.
The question whether any land which the Land Commissioneris authorised to acquire under sub-section (1) should or should notbe acquired shall, subject to any regulations made in that behalf, bedetermined by the Land Commissioner in the exercise of hisindividual judgment ; and every such determination of the LandCommissioner shall be final.
Where the Land Commissioner has determined that any landshall be acquired for the purposes of this Ordinance, the provisionsof the Land Acquisition Ordinance, subject to the exceptions, modi-fications and amendments set out in the First Schedule, shall applyfor the purposes of the acquisition of that land ; and any sum of moneywhich may, under such provisions be required to be paid or depositedby the Land Commissioner or by Government by way of compensation,costs or otherwise, shall be paid out of funds provided for the purposesof this Ordinance under section 4.”
The Land Commissioner asked Ladamuttu to show cause why theEstate should not be acquired. Thereafter on the 12th May, 1947, theLand Commissioner made a “ determination ” to acquire the Estate onbehalf of the Government.
On the 3rd July, 1947, by Ordinance No. 62 of 1947 certain amend-ments of the Land Redemption Ordinance No. 61 of 1942 were made.By one amendment of section 3 of the last-mentioned Ordinance therewas added immediately after clause (6) of sub-section 1, the following :—“ (c) transferred by its owner or his executors or administratorsto any other person, at the request of a mortgagee of that land, insatisfaction or part satisfaction of a debt which was due from thatowner or his predecessor in title to that mortgagee and which wassecured by a mortgage of that land subsisting immediately prior tothe transfer.
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The preceding provisions of this sub-section shall not apply tosuch undivided shares of an agricultural land as were sold or trans-ferred within the period specified in those provisions and in thecircumstances and manner set out in any of the preceding clauses (a),
and (c), but, where those shares- were converted after the sale ortransfer into any divided allotment or allotments by a partition decreeof any court or by a duly executed deed of partition, those provisionsshall apply to such allotment or allotments, and accordingly the word‘ land * occurring in this Ordinance shall be construed to include suchundivided shares which have been converted after sale or transfer asaforesaid into any divided allotment or allotments.”
On the 7th February, 1949, Ladamuttu was notified of the determina-tion of the Land Commissioner of the 12th May, 1947, to acquire theEstate. Later Ladamuttu as plaintiff commenced an action in the DistrictCourt of Colombo against the Attorney-General of Ceylon and “ The LandCommissioner, Colombo.” By his plaint in the action filed on the 23rdJuly, 1949, the plaintiff pleaded that he was a bona fide purchaser forvalue without notice and pleaded that the Land Commissioner had nopower under Ordinance No. 61 of 1942 to acquire the lands from himand he claimed an injunction restraining the defendants jointly or in thealternative from taking steps under that Ordinance to acquire the lands.By their answer on the 2nd March, 1950, the defendants asserted thatthe Land Commissioner had power to acquire the Estate according tothe provisions of section 3 of the Land Redemption Ordinance No. 61of 1942 : they further pleaded as follows :—“ the 2nd defendant’s deter-mination to acquire the Keeriyankalliya estate under the provisions ofthe said Ordinance is final and conclusive and cannot be questioned inthese proceedings and this Court has therefore no jurisdiction to entertainthe present action.”
On the 9th March, 1950, the Land Acquisition Act, No. 9 of 1950,was passed.
The provisions of section 3 sub-section 5 of the Land RedemptionOrdinance No. 61 of 1942 were amended. The Land Acquisition Ordi-nance (which had regulated the procedure of acquisition) was repealedand it was provided that where the Land Commissioner determinesunder section 3 sub-section 4 of the Land Redemption Ordinance thatany land should be acquired the purpose for which that land was to berequired was deemed to be a public purpose and the provisions (withexceptions, substitutions and modifications) of the Land AcquisitionAct were to apply for the purposes of the acquisition of that land I Asa result of the amendments made by the Land Acquisition Act it wasprovided that “ where the Land Commissioner determines that any landshall be acquired for the purposes of the Land Redemption Ordinancethe Minister shall make a written declaration that such land is neededfor a purpose which is deemed to be a public purpose and will be acquiredunder this Act and shall direct the acquiring officer of the province ordistrict in which such land is situated to cause such declaration in the
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LORD MORRIS—The Land Commissioner v. Ladairvuttw Pillai
Sinhalese, Tamil and English, languages to he published in the Gazetteand exhibited in some conspicuous places on or near such land.” The“ acquiring officer ” with reference to any land means the GovernmentAgent of the province or the Assistant Government Agent of the districtin which that land is situated or any other prescribed officer.
The importance of these amendments is that consequent upon themit did not lie with the Land Commissioner after a determination byhim under section 3 of the Land Redemption Ordinance to “ take steps ”to acquire the land.
Ladamuttu died in the early part of 1951 and on the 11th March,1953, his son (to whom letters of Administration had been granted) wassubstituted as the plaintiff in the action. Elaris petitioned to be addedas a third defendant and was joined as the third defendant.
The action was tried in the District Court on the 30th September andthe 6th November, 1953. During the hearing it was stated on behalf of'the substituted plaintiff that it was conceded that the Attorney-Generalcould not be sued and that the action against him should be dismissed.
The learned District Court Judge gave judgment on the 13th November,1953, dismissing the action. He held that the Land Commissioner hadhad power to order the acquisition of the property. In the course ofhis judgment he said :—
“ It was held in 54 N. L. R. 457 that in spite of the entering of aHypothecary Decree, the debt is still due on the Mortgage for pur-poses of section 3 (1) (6) of the Land Redemption Ordinance. Thefact that the land was transferred in satisfaction of two MortgageDebts secured by this property, does not take this case outside theprovisions of this section.
It was also argued that as secured lands were hypothecated bythese two Bonds P.l and P.2, only one of which was transferred insatisfaction of the two debts the transaction fell outside the scopeof this section. I am unable to.accept this contention. All thatthis section requires is that the land sought to be acquired, shouldhave been transferred in satisfaction or part satisfaction of the debtwhich was due from the transferor to the transferee and that it shouldhave been secured by way of mortgage for such debt. The fact thatother lands were also bound by way of Mortgage for this debt is quiteimmaterial. ”
Questions arose as to whether the Land Commissioner could be suedas such and the learned Judge held that he could. The issues framedduring the trial and the answers given by the learned District CourtJudge were as follows :—
“ 1. Is the land in question capable of acquisition under section 3of the Land Redemption Ordinance, No: 61 of 1942 ?—Yes.
Did the Land Commissioner on or about 12.5.47 make a deter-mination under section 3 (4) of the Land Redemption Ordinance,No. 61 of 1942, that KLiriyankaduru (sic) Estate be acquired ?—Yes.
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Was the said estate on or about 12.5.47 a land of the descrip-tion contained in section 3 (1) (b) of the Land Redemption Ordinance,No. 61 of 1942 ?—Yes.
Is the Rand Commissioner’s determination with regard to theacquisition of Kiriyankaduru Estate final ?—His decision on factsis final; the question of law whether he had authority to acquire aparticular land is subject to review by this Court.
If so can the correctness of the said determination be questionedin these proceedings ?—Vide answer to Issue 4.
Is plaintiff entitled to proceed against the 1st defendant asrepresenting the Crown to obtain an order of Injunction against theCrown ?—No.
Can plaintiff maintain this action against the 2nd defendantas the Land Commissioner without suing the officer who made theorder in question by name ?—Yes.
Is the plaintiff a bona fide purchaser for value from the originaltransferees of the said lands from the 3rd defendant ?—V es.
If so, is the 2nd defendant empowered to acquire lands fromhim?—Yes.”
Erom that Judgment the substituted plaintiff appealed to the SupremeCourt with the result, as stated above, that, by a majority, the appealsucceeded. In a careful and comprehensive Judgment the learned ChiefJustice held that the Land Commissioner had no authority in law toacquire the Estate. He held that section 3 (1) (6) did not apply to acase in which the lands transferred were some only of lands secured bya mortgage. In dealing further with, the provisions of section 3 (1) (6;the learned Chief Justice said :—
“ Learned counsel bases his contention that the transfer P5 doesnot fall within the ambit of section 3 (1) (6) on the followingconsiderations :—
(а)What was transferred was not the lands themselves but undivided
shares in the lands. The transfer of a land and of anundivided share in a land is not the same. The sectioncontemplates transfer of a land or lands and not undividedshares in a land or lands.
(б)The transfer to Sekappa was not in satisfaction or part satisfac-
tion of a debt which was due from Elaris Perera toSekappa. It was in satisfaction of the debt due on bond PIin favour of Sockalingam, Subramaniam and Arunasalam.
The submission that the section applies only to the transfer of theland securing the debt and not to the transfer of an undivided sharein it, is sound. The section refers to land and not to undivided sharesin land. An undivided share in a land is not the same as the landitself and the transfer of an undivided share in a land is not a transfer
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LOUD MORRIS—The Land Commissioner v. Ladamuttu JPiUai
of the land. Learned counsel for the Crown did not seriously resistthis argument.
Learned counsel also submitted that once Sockalingam institutedaction for the recovery of the money due on bond P2, Sekappa whowas party to that bond lost his right to proceed against Elaris Perera,,the obligation created thereby being joint and several.
It is correct that when one of joint and several creditors institutesan action to recover a debt, payment to the other co-creditors doesnot extinguish the debt. The moment Sockalingam instituted theaction on the bond Elaris Perera’s right to choose the co-creditorto whom he would pay the debt ceased and his debt became payableto Sockalingam alone.”
After referring to various authorities he continued :—
“ The foregoing citations support learned Counsel’s contentionthat Sekappa’s right to claim the debt from Elaris Perera ceased onthe institution of the mortgage action by Sockalingam and that thetransfer to Sekappa was not therefore a transfer in satisfaction or partsatisfaction of a debt due from Elaris Perera to Sekappa. Clearlythen the transfer, apart from it being a transfer of undivided shares*does not for this additional reason, come within the ambit of section3 (1) (6).”•
In regard to procedural matters the learned Chief Justice held that theLand Commissioner could be sued nomine officii and that action couldalso be maintained against the Attorney-General and that the Courtwas entitled to consider whether the Land Commissioner had exceededhis powers under the Ordinance. Pulle, J., delivered a judgment whichwas in accord with that of the Chief Justice. De Silva, J., was of adifferent opinion. He held that it was not necessary that the landtransferred should be co-extensive with the land secured by the mortgage.He further held that even though Sockalingam alone had sued on themortgage bond P2 Elaris did not cease to be indebted to Sekappa as amortgagee under that mortgage bond. He Silva, J., would therefore havedismissed the appeal as he considered that the substituted plaintiff hadfailed to establish that the land in question (the Estate) did not comewithin the provisions of section 3 (1) (6).
In the result the appeal was allowed and it was ordered “ that judgmentbe entered for the subsituted plaintiff directing that an injunction boissued restraining the defendants jointly or in the alternative from takingsteps under Ordinance 61 of 1942 to acquire the lands described in theSchedule hereto ”. The Schedule described other lands as well as theEstate. The Hecree in the form as set out must have been enteredper incuriam for the determination of the Land Commissioner was limitedto the Estate whereas the injunction would cover other lands as well as-the Estate. But quite apart from this there are substantial reasons whichlead their Lordships to the conclusion that the Judgment cannot stand.In the first place under the Judgment an injunction is issued against the
LORD MORRIS—The Tiand Commissioner v. LadamnUv. Filial
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Attorney-General whereas in the District Court it had been concededthat the action as against the Attorney-General should be dismissed. Inthe second place the injunction as framed and as claimed in the Plaintin the action would restrain the taking of any step under Ordinance 61of 1942 to acquire the Estate (leaving aside the question concerning theother lands referred to above). But the only determination that was madeby the Band Commissioner was that which was made under 3 (1) (b)on the 12th May, 1947, and after that date Ordinance 61 of 1942 wasamended. As stated above it was amended by Ordinance 62 of 1947.As a result Ordinance 61 of 1942 now includes paragraph (c) of sub-section (1) of section 3. The injunction as framed would prevent theLand Commissioner from making a new determination and from endea-vouring to justify it as being warranted by the provisions of Ordinance61 of 1942 in the form in which it stood after the 3rd July, 1947.
These objections to the Decree of the Court leave untouched thequestions as to the effect of bringing proceedings against the LandCommissioner. There is the further question that the injunction wouldappear to ignore the changes in regard to acquiring land which wereeffected by the Land Acquisition Act. No. 9 of 1960.
Eor the reasons given their Lordships consider that the Order madeby the Decree of the Supreme Court cannot be supported and that theobjections to the Order presented on behalf of the Land Commissionermust prevail. It may here be stated that Elaris did not appear andwas not represented before their Lordships’ Board.
In argument before the Board Sir Prank Soskice, on behalf of thesubstituted plaintiff, while not abandoning a claim to the issue of aninjunction stated that his client would be content if a declaration weremade to the effect that “ the determination made by the Land Commis-sioner on the 12th May, 1947, to acquire the ICeetiyankalliya Estatepursuant to section 3 (1) (6) of the Land Redemption Ordinance No. 61of 1942 was xdtra vires and void.”
Important questions are raised (a) as to whether on the 12th May,1947, the circumstances were covered by and were within the wordingof section 3 (1) (&) of the Land Redemption Ordinance and (6) as to theappropriate procedure for seeking determination of the issues raisedby the plaintiff and the substituted plaintiff.
Under the provisions of section 3 (1) (b) of the Land RedemptionOrdinance the Land Commissioner was authorised to acquire the Estateon behalf of the Government if satisfied that the Estate was part ofagricultural land which was transferred by its owner “ to any otherperson in satisfaction or part satisfaction of a debt wThich was due fromthe owner to such other person and which was ^immediately prior tosuch transfer secured by a mortgage of the land.” The Estate wasowned by Elaris. It was transferred together with certain other landsto Sockalingam and Sekappa. The words in the Ordinance £c to anjrother person ” must, their Lordships conclude, be interpreted as includingany other person ot persons. If then the land including the Estate
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which was transferred by P.5 was transferred to Sockalingam andSekappa, was such transfer in satisfaction or part satisfaction of adebt which was due from Elaris to Sockalingam and Sekappa ?
It was contended that the “ land ” was not transferred within themeaning of section 3 (1) (6) of the Land Redemption Ordinance in thatonly undivided shares in the land were transferred to different persons.Their Lordships cannot accept this contention. The “ land ” was trans-ferred by Elaris. The circumstance that as between the two transfereesone took an undivided two-third share and the other an undividedone-third share does not alter the fact that the land (which includedthe Estate) was transferred by Elaris.
Was such transfer in satisfaction or part satisfaction of a debt ? Ifwas contended that it was not inasmuch as the Deed of Transfer (P.5)of the 4th May, 1935, recited that the transfer which was of the Estatetogether with certain other lands was in consideration of the sum ofRs. 75,000 “ well and truly paid ” by Sockalingam and Sekappa. Itwas submitted therefore that the real nature of the transaction was thatit was an out and out sale of land for a consideration of Rs. 75,000. Theactual wording in the Deed was:—“in consideration of the sum ofRupees Seventy-five thousand (Rs. 75,000) of lawful money of Ceylonwell and truly paid to me by the said vendee (the receipt whereof I dohereby admit and acknowledge) …”. It was earlier recited that-
the vendor had agreed with Sockalingam and Sekappa, “ hereinaftersometimes called or referred to as the vendee But in the attestationclause signed by the Notary Public it was certified “ that the full consi-deration above-named was set off in full satisfaction of the claim and costsdue in Case No. 7365 D. C. Negombo and the principal and interest due onMortgage Bond No. 391 dated 30th September, 1925, attested by T. A.Fernando, Notary Public, and that the said vendor undertook to releasethe lands appearing in this Deed from tertiary mortgage bond bearingNo. 2339 dated 8th March, 1931 ….**.
It is provided by the Notaries Ordinance (1907. Volume 3 LegislativeEnactments of Ceylon Cap. 91) that a notary in attesting any deed orinstrument executed or acknowledged before him must state whetherany money was paid or not in his presence as the consideration or partof the consideration of the deed or instrument and if paid the actualamount in local currency of such payment (see section 30 (20)).
The • terms of the attestation clause point to the conclusion that nomoney was paid by Sockalingam and Sekappa in the presence of theNotary Public and it seems clear that instead of there being any paymentof Rs. 75,000, that amount was set off in full satisfaction of the claimand costs due in case No. 7365 and the principal and interest due onmortgage bond No. 301 (P.l). In considering the word “ debt ” as usedin section 3 (1) (b) their Lordships see no reason to exclude a debt dueunder a mortgage decree founded upon a mortgage bond. The variouslands (one part of which was the Estate) were however transferred byElaris to Sockalingam and Sekappa in satisfaction of debts due fromElaris to Sockalingam. The claim in Case No. 7365 was a claim by
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Sockalingam alone. The principal and interest due on Mortgage BondNo. 391 was due to Sockalingam and others. Sekappa was not a partyto such Mortgage Bond. Their Lordships cannot therefore resist theconclusion that though the land covered by the transfer P.5 was trans-ferred by Elaris to Sockalingam and Sekappa it was not transferred insatisfaction of a debt or debts due to Sockalingam and Sekappa. Onthis ground their Lordships consider that the determination made by theLand Commissioner on the 12th May, 1947, was not warranted by theprovisions of section 3 (1) (6) of the Land Redemption Ordinance.
It was submitted by Mr. Gratiaen' that if the lands transferred byElaris had been transferred to Sockalingam alone the provisions ofsection 3 (1) (b) of the Land Redemption Ordinance would have beenapplicable and he submitted that inasmuch as the transfer to Sockalingamand Sekappa was in satisfaction of two secured debts (the debt secured bythe Mortgage Bond P.l and the debt created by the Mortgage DecreeP.4) which Sockalingam could release alone, the transfer had the samelegal effect as a transfer to Sockalingam alone. Mr. Gratiaen submittedthat after a transfer to Sockalingam he (Sockalingam) could have trans-ferred the land or an interest in it to someone else and that if atSockalingam’s wish the transfer by Elaris was in the first instance toSockalingam and to someone else then the transfer should not be regardedas being outside the provisions of section 3 (1) (6). This submissioninvolves substituting for the words “ transferred … to any other-person ’* the words “ transferred … to or to the order of any
other person ”. On the facts of the present case the land was transferredto two persons in satisfaction of debts due to only one of them. TheirLordships are mindful of the fact that resort to the provisions of the LandRedemption Ordinance may lead to the expropriation of land (albeiton the payment of compensation) and they consider that the wordingof the Ordinance must be shown to be strictly applicable before a “ deter-mination ” can validly be made.
The circumstance that when by the Deed of Transfer of the 4th May,1935 (P.5), Elaris transferred the Estate and other lands to Sockalingamand Sekappa he (Elaris) undertook to release the lands appearing in theDeed from the tertiary mortgage bond (as the attestation clause shows)does not alter the conclusion that the lands were, transferred toSockalingam and Sekappa in satisfaction of the debts due from Elaris toSockalingam.
Reference must be made to certain other submissions which wereadvanced in support of the contention that the Land Commissioner wasnot warranted in making his determination of the 12th May, 1947. Itwas said that the debt due from Elaris under Mortgage Bond No. 533(P.2) became merged in the Judgment in Case No. 7365 in the DistrictCourt of Negombo and that the transfer by Elaris was, as a result, notin satisfaction or part satisfaction of a debt ec which was immediatelyprior to such transfer secured by a mortgage of the land ”. It was saidthat though after the Judgment the mortgage continued to exist for somepurposes yet it did not secure the judgment debt. Their Lordships have
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RORD MORRIS—The Land. Commissioner v. LadarmUtu Pittai
concluded that the lands transferred by Elaris (which lands included theEstate) were transferred in satisfaction of the debt secured by the Mort-gage Bond of the 30th September, 1925 (P.l), and of the claim and costsdue in Case No. 7365. But their Lordships see no reason to differ from theconclusion in Perera v. Unanternia1. In that case it was held that wherea land is mortgaged and the mortgage is put in suit and decree isentered against the mortgagor for the payment of the amount due onthe mortgage bond, a subsequent voluntary conveyance by the mortgagorin favour of the mortgagee, the consideration for which is set off in fullsettlement of the amount due on the decree, is a transfer as contemplatedin section 3 (1) (6).
It was further said that inasmuch as some only of the lands which weremortgaged were transferred by the Deed of .Transfer of the 4th May,1935 (P-5), the provisions of section 3 (1) (6) were for that reason in-applicable. It was said that those provisions were designed to coverordinary cases where an owner of a piece of land borrows money on thesecurity of a mortgage of such piece of land and then transfers it to thelender in satisfaction of the loan. Their Lordships see no reason to defineor to limit the circumstances under which the provisions of section 3 (1)(6) become applicable or to seek to apply any other test than that whichis directed by the language of the section. Nor can their Lordshipsaccede-to the submission that section 3(1) (6) cannot apply to a case wherethe lands transferred are some only of the lands secured by mortgage.
The Land Commissioner is authorised to acquire “ the whole or anypart ” of agricultural land which was transferred in the manner describedin (6). The Estate was a part of the land transferred. The land wastransferred by its owner Elaris. It was transferred to Sockalingam andSekappa. Was it transferred to them in satisfaction or in part satisfac-tion of a debt (or debts) due from Elaris to them being a debt (or debts)secured (immediately prior to the transfer) by a mortgage of the land ?For the reason already stated their Lordships consider that this questionmust be answered in the negative and that the determination of the LandCommissioner was not warranted by the provisions of the Section.
It cannot be said that the transfer of the land was to Sockalingamalone inasmuch as the Deed of Transfer expressly states that it was toboth Sockalingam and Sekappa.
Their Lordships need only briefly advert to a point that was originallypleaded in the action but which was not taken before their Lordships’Board. It was pleaded that the determination of the Land Commissionerto acquire the Estate under the provisions of the Ordinance was final andconclusive and could not be questioned in the proceedings and that theCourt had no jurisdiction to entertain the action. Such pleading wasdoubtless framed with the provisions of sub-section 4 of section 3 inmind. Their Lordships consider that any question of finality in theLand Commissioner’s determination can only arise in regard to his exer-cise of individual judgment as to whether he should or should not acquire
1 (IS53) 54 N.L.JZ. 457.
LORD MORRIS—The Land Commissioner v. Ladamuttu JF*illai
181
any land which he “ is authorised to acquire under sub-section 1 **. TTispersonal judgment can only be brought to bear upon the question as towhether or not he should acquire land that is covered by the wording ofsub-section 1. The antecedent question as to whether any particular landis land which the Land Commissioner is authorised to acquire under theprovisions of sub-section 1 is not one for his final decision but is onewhich, if necessary, must be decided by the courts of law.
These being their Lordships’ conclusions upon the substantive as-opposed to the procedural issues which present themselves in this appealthe question arises as to what course should be followed. After the•death of Ladamuttu the substituted plaintiff decided to continue the actionand to proceed to claim relief in the form in which it had originallybeen sought. The first prayer was for an injunction restraining the•defendants jointly or in the alternative from taking steps under Ordinance61 of 1942 to acquire lands described in the Schedule to the Plaint. Asalready pointed out the determination had been under the provisions ofsection 3 (1) (b) but by the date of the Plaint Ordinance 61 of 1942 hadbeen amended to include section 3 (1) (c). An injunction in the termsasked for would therefore have precluded the malting of a new determina-tion under the terms of section 3 (1) (c) if such a new determination werethought to be competent. Furthermore before the action came to trial andbefore the action was continued by the substituted plaintiff the law as tothe procedure to be followed in the acquisition of land (after a determina-tion by the Land Commissioner) had been changed. By tbe time thatthe action came to trial the holder of the office of Land Commissionerwas not the same person as the holder at earlier relevant dates. Atthe trial of the action important procedural issues were debated but thenthe Attorney-General was by consent dismissed from the action. There-after, on appeal, the substituted plaintiff obtained the judgment in his- favour which directed that an injunction (in the terms originally askedfor) should be issued restraining the defendants jointly or in the alternative.In view of all the circumstances and of the course that this litigationhas taken and of the fact that the Attorney-General was a party but nolonger is their Lordships cannot think that at this stage of the litigation itwould be appropriate to accede to an application that some form ofdeclaration should be made.
It is to be remembered that the Plaint was in July, 1949. The actionwas brought following upon a notification to the plaintiff by the LandCommissioner on or about the 7th February, 1949. The determination ofthe Land Commissioner had been in May, 1947. The learned ChiefJustice records in his judgment that the Land Commissioner at the time ofthe determination was Mr. (later Sir Arthur) Ranasinha. When theaction was instituted the Land Commissioner was-Mr. Amarasinghe. Eventhe successsor of the latter was no longer in office at the time when thecase was under appeal in the Supreme Court.
It is provided by section 463 of the Civil Procedure Code that if theGovernment undertake the defence of an action against a public officer
182
LORD MORRIS—The Land Commissioner v. LadamxUtu TiLlai
the Attorney-General shall apply to the Court and that upon such appli-cation the Court shall substitute the name of the Attorney-General as aparty defendant in the action. It is provided by section 464 that if suchapplication is not made by the Attorney-General on or before the dayfixed in the notice for the defendant to appear and answer to the plaintthe case shall proceed (subject to certain exceptions) as in an action,between private parties. But in the present litigation the Attorney-General was made a defendant and was then with the concurrence of thesubstituted plaintiff dismissed from the proceedings.
Their Lordships do not think tha t without hearing the Attorney-Generalit would be appropriate to pass opinion upon all the procedural issueswhich were discussed by the learned Chief Justice in his judgment thoughsome of these call for consideration. While their Lordships must reservetheir opinion upon the question (which in view of the conclusions reachedby their Lordships does not immediately arise) as to whether in circum-stances such as those in the present case any injunction against theAttorney-General could or ought to be granted their Lordships considerthat if the authority of a Land Commissioner to make a determinationunder section 3 of the Land Development Ordinance is challenged theappropriate procedure is by way of an application for certiorari (seeLeo v. Land Commissioner2). The Land Commissioner as the judicialtribunal the validity of whose action is being tested may then convenientlybe brought before the higher Court so that if necessary his decision or ordermay be brought up and quashed. If in some particular case it can beshown that a determination has not been within the competence of aLand Commissioner and if an application is made which results in anorder to bring up and quash his determination then the difficulties whichthe present proceedings bring into relief are avoided. It was Mr. Ama-rasinghe who was the Land Commissioner in July, 1949, when theseproceedings began and whose proxy was filed and on whose behalf anAnswer was presented. If a declaration were now to be made—whowould be bound ? If an injunction were to be granted—who wouldbe enjoined ? It was sought to be said that the Land Commissioner is aCorporation Sole. Their Lordships do not find support for this view inthe provisions of the Land Development Ordinance of 1935. In the Inter-pretation Section (Section 2) it is laid down that “Land Commissioner ”means “ the officer appointed by the Governor under section 3 of thisOrdinance and includes any officer of this Department authorised by himin writing in respect of any particular matter or provision of this Ordi-nance ”. The Land Commissioner is not expressly created a CorporationSole by any legislative enactment nor is it laid down that he may sueor be sued in a corporate name. Furthermore no legislative enactmentseems to reveal any intention to incorporate. If, following upon a deter-mination by the Land Commissioner (which if made within his powersis made “ in the exercise of his individual judgment **) land is acquired,such land does not vest in the Land Commissioner. If there had been adesire to incorporate the Land Commissioner there could have been express
i (1955) 57 N.L.R. 178.
The Land Commissioner v. Jayewardone
183
words of incorporation. Thus in the case of the Public Trustee it isenacted by section 3 of the Public Trustee Ordinance of 1930 as follows :—“ The Public Trustee shall be a Corporation Sole under that name withperpetual succession and an official seal and may sue and be sued underthe above name like any other corporation sole.”
All these considerations including the absence of any evident intentto incorporate lead their Lordships to reject the submission that the LandCommissioner can be regarded as a Corporation Sole. (Compare MacKenzie-Kennedy v. Air Council*).
In view of the decisions which their Lordships have reached andexpressed in regard to the relief which was sought in the District Courtand in the Supreme Court and which after the changes made in 1950 wasthe relief which the substituted plaintiff persisted in claiming and in viewof the absence of the Attorney-General as a party to the proceedingssubsequent to those in the District Court their Lordships must refrainfrom pronouncing upon other procedural questions which are discussedin the Judgment of the learned Chief Justice. Athough Their Lordshipsare of the opinion that the Land Commissioner was not entitled to makethe determination that he did under section 3 (1) (6) of the Ordinance of1942 their Lordships consider, for the reasons stated above, (1) that theOrder of the Supreme Court cannot stand and (2) that it would not beappropriate at this stage of the litigation to accede to the applicationthat some form of declaration should be made.
Accordingly their Lordships will humbly advise Her Majesty that theappeal should be allowed and that the Order and Judgment of the SupremeCourt be set aside and that the action should be dismissed with costs.The first respondent must pay the- costs of the hearing before theirLordships’ Board and in the Supreme Court.
Appeal alloived.