Kwang and Murray v Yokkei
| Jurisdiction | Caribbean States |
| Judge | Rajnauth-Lee, J. |
| Judgment Date | 20 May 2016 |
| Court | Caribbean Court of Justice |
| Docket Number | CCJ Appeal No. GYCV2015/007; GY Civil Appeal No. 66 of 2012 |
| Date | 20 May 2016 |
Caribbean Court of Justice
Saunders, J. CCJ.; Wit, J. CCJ.; Hayton, J. CCJ.; Anderson, J. CCJ.; Rajnauth-Lee, J. CCJ.
CCJ Appeal No. GYCV2015/007; GY Civil Appeal No. 66 of 2012
Mr. Devindra Kissoon, Mr. Rajendra N Poonai and Mr. Naresh Poonai for the appellants.
Mr. Mohabir Anil Nandlall, Mr. Manoj Narayan and Ms Sasha S Mahadeo for the respondent.
Sale of property - Whether the conduct of the appellants amounted to fraud within the meaning of section 22(1) of the Deeds Registry Act — Knowledge of a prior sale — Whether the respondent's failure to oppose the transport amounted to a bar to any action under the act — Whether the respondent was entitled to specific performance of the agreement with the appellant — Whether the respondent is entitled to mense profit.
[1] This appeal arose out of successive sales of a parcel of land located at Lot 38 First Avenue, Bartica, Guyana (the disputed property). In 1996, the Respondent, Tsui Yokkei (Cheekee) moved into the disputed property and began operating a restaurant business. In 2000, the First Appellant, Chee Yui Kwang (Kwang) orally agreed to sell the disputed property to Cheekee for US$90,000.00. Cheekee made a down payment of US$20,885.00 and it was agreed that he would pay off the balance of the purchase price in instalments. Cheekee made several payments totalling US$34,399.99 via bank transfers which were done through his son-in-law, Martin Murray (Martin). He also effected substantial repairs to the disputed property totalling G$3,000,000.00 and paid all the rates and taxes on the disputed property. He allowed Martin to use one quarter of the property and to rent out another portion of it at a rate of G$55,000.00 per month. Subsequently, in 2006, Kwang sold the disputed property to Millicent Murray (Millicent), Martin's sister. Kwang then conveyed the disputed property to Millicent by way of transport No. 270 of 2006. From 2009, the rental income from the disputed property was paid to Millicent.
[2] Cheekee commenced an action in the High Court against Kwang and Millicent, arguing that the transport to Millicent should be set aside because it was obtained by fraud. Cheekee also sought an order directing the Registrar of Deeds to pass transport to the disputed property to him. In their defence, Kwang and Millicent contended that Cheekee had failed to pay off the full purchase price for the dispute property by 2004 as agreed. They also argued that the 2006 sale was not fraudulent as Cheekee knew the disputed property was purchased by Millicent and failed to oppose the passing of transport.
[3] Chang CJ (Acting) ruled in favour of Cheekee, holding that the actions of Kwang and Millicent amounted to fraud which was covered by section 22(1) of the Deeds Registry Act (the Act). [Cap 5:01 of the Laws of Guyana.] The transport to Millicent was set aside and Kwang was ordered to pass transport to Cheekee upon receipt of the balance of the purchase price of US$55,601.00, which sum Cheekee had paid into court in August, 2006. Chang, C.J. also ordered that the mesne profits derived by Millicent from her receipt of the rental payments since 2009 should be paid over to Cheekee within one month. He ordered costs in the sum of G$50,000.00 to be paid to Cheekee.
[4] Both Kwang and Millicent appealed this decision to the Court of Appeal, which affirmed the ruling of Chang CJ. In their view, Kwang and Millicent had embarked on a scheme of unconscionable conduct such as to amount to fraud. The court found no basis upon which to interfere with the decision of Chang CJ. Costs amounting to G$250,000.00 were ordered to be paid to Cheekee. Kwang and Millicent then appealed to this Court.
[5] Before this Court were four main issues: (i) whether the conduct of Kwang and Millicent amounted to fraud within the meaning of section 22(1) of the Act, (ii) whether Cheekee's failure to oppose the transport operated as a bar to any action under section 22(1), (iii) whether Cheekee was entitled to specific performance of the 2000 oral agreement with Kwang and (iv) whether Cheekee was entitled to mesne profits owing to Millicent's receipt of rental payments from the disputed property. All four issues were decided in favour of Cheekee.
[6] In relation to first issue, Kwang and Millicent argued that Millicent's mere knowledge of the prior sale did not amount to fraud and that Cheekee's failure to complete the full payment of the disputed property in 2004 operated as a bar to his claim of fraud. The Court noted that ‘fraud is an amorphous concept’ which is impossible to define within strict parameters. Section 22(1) contained no definition of the term, but in its earlier decision of Ramkishun v. Fung Kee Fung, [ [2010] CCJ 3 (AJ); (2010) 76 W.I.R. 328.] the Court, per Wit, J. CCJ., had observed that the term ‘fraud’ as used in section 22(1) of the Act had a wide meaning. The Court held that the circumstances of the subsequent sale of the disputed property to Millicent clearly fell within section 22(1) which covered not only the person who perpetrated the fraud but also all persons who were privy to the fraud and obtained transport thereby. The fact that Kwang sold the property to Millicent and conveyed it to her by transport when she was fully aware of Kwang's prior and subsisting agreement of sale with Cheekee made Millicent a participant in the breach of the agreement and a privy to the fraud committed by Kwang. Furthermore, the second sale was unconscionable given that Millicent had first approached Cheekee offering to buy the disputed property and that she knew Cheekee was in possession of the disputed property, had effected repairs to it and had made several payments towards the purchase price.
[7] The Court therefore rejected the argument advanced by Kwang and Millicent that mere knowledge of a prior sale could not amount to fraud. This contention was based on the decision of the Judicial Committee of the Privy Council in Waimiha Sawmilling v. Waione Timber Co. [1926] A.C. 101 The Court held that this case was distinguishable on the law and on the facts because it dealt with fraud under the registered system of land tenure, whereas the disputed property fell under the Act. Moreover, in Waimiha there was no fraud committed given that the caveat placed on the sawmill owned by Waimiha had been discharged by court order before the second transaction was effected. Regarding Cheekee's alleged failure to complete the sale, the Court noted that the trial judge had found as a fact that there was no stipulated completion date in the 2000 oral agreement and Kwang never made time of the essence or called upon Cheekee to complete the sale. Therefore, Kwang and Millicent did not provide any material to displace the conclusion that their conduct was fraudulent and caught by section 22(1) of the Act. Fraud having been proved and Millicent having been privy thereto, the transport to Millicent had to be set aside.
[8] On the second issue, the Court held that Cheekee's alleged failure to oppose the passing of transport did not prevent him from pursuing a claim under section 22(1) of the Act. As established in Ferreira v. Ho-a-Hing, [ 1896 L.R.B.G. 78] under the Roman-Dutch system of land law which applies in Guyana, a person cannot lose the right to oppose the passing of transport unless he had actual notice thereof. There was no material upon which the Court could find that Cheekee had such actual notice. Kwang never terminated the 2000 oral agreement and also never notified Cheekee of the subsequent sale to Millicent. The fact that in 2005 Millicent told Cheekee she has bought the disputed property was of no moment given that transport was only passed in 2006. Therefore, in 2005 there was nothing for Cheekee to oppose. The Court also held that the mere publication of the passing of transport in the Gazette did not amount to actual notice to Cheekee.
[9] On the issue of specific performance, the Court noted that this remedy is available in relation to immovable property by virtue of section 3(d)(iii) of the Civil Law of Guyana Act. [Cap 6:01 of the Laws of Guyana.] The Court refused to allow Kwang and Millicent to argue that Cheekee's failure to include a plea that he was ready, willing and able to complete the sale was fatal to his claim for specific performance, given that this issue was never raised in their grounds of appeal either before the Court or the Court of Appeal. In any event, the trial judge was clearly of the view that Cheekee was ready, willing and able to complete the sale since Cheekee had paid the balance of the purchase price into court in August, 2006. In all the circumstances, the Court did not consider that it was fair and just that this pleading point should be taken at this stage.
[10] The Court upheld the trial judge's order that all mesne profits derived by Millicent from the rental of part of the disputed property since 2009 should be paid over to Cheekee. The parties were encouraged to arrive at a consent order for lodging with the Court within six (6) weeks of the date of this judgment setting out the full amount owed to Cheekee and the date by which the payment will be made. In the absence of such a consent order, the matter will be remitted to the High Court for an account of the mesne profits to be taken.
[11] The Court therefore dismissed the appeal. It ordered the Registrar of Deeds to cancel the transport passed to Millicent and to pass transport of the disputed property to Cheekee. On the passing of the transport, the Registrar of the Supreme Court was authorized to pay out to Kwang the sum of US$55,601.00 paid into court by Cheekee together with such interest which may have accrued on that sum. The Court ordered Kwang and Millicent to pay Cheekee's costs as ordered by the lower courts as well as the costs of this appeal amounting to basic costs in the sum of...
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