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Louis v Kakae [2003] VUSC 9; Civil Case 041 of 2001 (26 February 2003)

IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

Civil Case No. 41 of 2001

BETWEEN:

TOM LOUIS
Plaintiff

AND:

KAKAE JAMES, LYDIA LOUIS, TOM LOUIS,
PAKOA JOE, KALO DONALD, DAVID TOARA,
JAMES LOUIS and DANIEL LOUIS
First Defendants

AND:

THE DIRECTOR OF LANDS
Second Defendant

JUDGMENT

This dispute concerns the land in lease title 11/OJ23/021 at Tagabe in Port Vila. All parties live on the land. It is 15 ares 12 centiares in area. There is an oblong, single storey construction divided into six rooms.

The plaintiff says he and his wife are the registered holders of the lease and he seeks eviction of the defendants. Lydia Louis and the other defendants, her children and relatives, say that lease was obtained by fraud or mistake and should be registered in their name. In the alternative they argue the lease is held on trust for them.

The chronology of events is important.

14th February 1978 – Lydia Louis and her husband purchased the land for FNH700,000. They were the registered owners. A mortgage of FNH800,000 was registered over the land to secure the purchase loan.

1980 – At Independence the land laws changed. Lydia Louis and her husband became alienators and entitled to remain on the land and to the issue of a lease or compensation for improvements.

1981 – Lydia Louis and her husband became the registered alienators and were issued with a certificate of registered negotiator.

1984 – Lydia Louis’ husband died. She decided to move to Santo with her children. She left others in charge of the land. There were rooms on it which were being rented out.

26 July 1985 – Letter of Port Vila Urban Land Corporation (ULC) informed Lydia Louis her lease was ready. She had to pay survey fees and then could sign the lease. (The English and French versions of this letter give 30 days for this, the Bislama sets no time limit). She accepts she received this letter.

11th November 1985 – Lydia Louis appointed Kakae James (another defendant) as attorney to act on her behalf. He gave an address of c/- Taxi Station, Port Vila.

15th November 1985 – Lydia Louis sent a letter to ULC telling them her husband had passed away and she appointed Kakae James as attorney. She referred to payments in respect of the lease.

January 1986 – Tom Louis said that a representative from the ANZ bank came and told him if the loan repayments weren’t made the bank would take the house. Tom Louis paid off the balance of the loan, VT126,175. That is not disputed.

30th January 1986 – ULC sent a letter to Lydia Louis, c/- James Kakae at the Taxi Station inviting her to come in and sign the lease.

James Kakae stated in evidence he never received this letter. He also said he never went into the office of ULC from the time he was given power of attorney. He said he was waiting for them to contact him.

12th August 1986 – ULC wrote to Tom Louis, the plaintiff, stating Lydia Louis had lost her right over the land and stating it now belonged to the ULC. He was invited to attend the ULC office on 14th August at 9 a.m.

It was not addressed in evidence why this letter was written to Tom Louis and whether or not any letter was written to Kakae James or Lydia Louis.

12th August 1986 – Tom Louis says he saw Kakae James but was told Lydia had no money to pay the lease. The next day, he says, his wife Margaret telephoned Lydia and told her that the ULC said she had lost her right to the property.

18th August 1986 – Tom Louis wrote to ULC. He explained how his brother had been paying for the loan and asked them to reconsider and give back to Lydia her right over the land.

11th August 1987 – The ULC wrote to Tom Louis’ wife saying that Lydia’s husband had lost his right over the ground and saying as she was family with Toara Louis, if she paid the improvements, VT120,900 and fees then she would have priority.

Over the next two years Tom Louis paid the price of the improvements VT120,900 in instalments. The receipts were issued in Lydia’s name. Tom Louis said this was done as her name was still on the ULC’s books. Lydia says this is evidence he intended to hold the land in trust for her. She says that at this time and when taking the lease he said he would hold the lease for her. Tom Louis denies this.

1986 – 1991 Tom Louis says he paid off the bank loan, paid the improvements’ fee to ULC and put a lot of money into improving the buildings, in particular, installing electricity and water. He produced receipts. I accept his evidence on this.

Over this period and for a time before there were some tenants in the rooms. There is a conflict of evidence as to how many tenants, how much rent was actually received and by whom and who drove whom away. It is impossible on the evidence before me to make any findings about tenants, receipts of rent and the driving out of others.

7th May 1991 – A lease was issued in the name of Tom and Margaret Louis and registered. Tom Louis paid all the fees relating to the issue of this lease.

1991 – 1997 – Tom Louis collected rent from two tenants.

1998 or 1999 – Lydia Louis asked if she could stay in a room as she needed medical treatment at Vila Central Hospital. She has lived there since.

January 1999 – December 2000 – At various times all the defendants moved in to the rooms. They have not paid any rent. This is not disputed. They say since Lydia’s husband died, as a matter of custom Tom Louis must look after her and her children. (see in particular, paragraphs 10 and 11 of Api Toara’s affidavit). They say Tom Louis made it clear he was holding the property for the family.

The plaintiff says he has a properly issued and registered lease. There was no fraud or mistake. He paid off the bank loan, paid for the improvements, spent substantial sums improving the rooms, paid all the lease issue fees. He said he did not say he was doing it for the family. Even in custom he does not have the obligation to look after Lydia and her children. From 1991 – 1998 he occupied and controlled the property, paid the outgoings and rented rooms. Since the defendants moved in none has paid any rent, nor indeed spent anything on the property. They chased away his niece and two tenants. If he had not stepped in a stranger could have taken the lease on payment of the sums he made and the defendants would be evicted. He asks for the removal of all defendants.

Lydia responds that after the death of her husband finances were difficult. She moved to Santo. She and her husband had bought the land for FNH700,000. With charges that was VT800,000, and with interest over time, it exceeded VT1 Million. All but VT126,175 had been paid off by her and her husband. She was not properly informed about what was happening with the lease. Tom Louis said he would hold the lease for her and her children, and this is consistent with his obligations in custom. He levered her out of the property. She asks that the Court order the Register be changed to show her as the lease proprietor or Tom and Margaret Louis hold it in trust for her.

There is undisputed evidence that one FNH is equal in value to 1 Vatu. It is also undisputed that Lydia Louis received the message to go in to the ULC to complete the formalities on her lease. She didn’t do that and either failed to tell her attorney to do so or he failed to go.

The land valuations of Tariodo Joseph do not assist. On 25th May 2000 he estimated the value at Vt18,000,000. On 11 November 2002 he valued the property at Vt1,458,000. I disregard his evidence.

It is not difficult to understand the point of view of both Tom Louis and Lydia Louis. They have each put a lot into this property. Lydia was probably only prevented from becoming owner of the lease by the untimely death of her husband. On the other hand if Tom Louis had not stepped in and paid the bank loan, the improvements to the land and the lease expenses the land would have been lost to a stranger, with little or no return to Lydia. It must be said that on the evidence the other defendants have not helped to obtain the lease or pay other sums. They have just moved in, enjoyed the property and contributed nothing.

There is nothing before me that suggests that Tom Louis and his wife obtained this lease by fraud or mistake. When told his wife had priority Tom Louis’s first reaction was to try to get the lease back for Lydia, (Annex I to the affidavit of Lydia Louis).

There have been arguments over tenants, collection of rents and pushing people out. The lease was offered to Lydia. She knew this but neither she nor her attorney went in to complete the formalities; also she apparently did not have the money. None of this amounts to fraud or mistake in the way Tom obtained the lease.

Lydia claims in the alternative that Tom holds the property on trust for her. He paid off the loan to help her, put receipts in her name and wrote trying to have Lydia restored as the person entitled to the lease. She says in custom it is his duty to look after her. Several of the defendants testified that the plaintiff had stated at the time he took the lease he would hold it on behalf of Lydia.

The plaintiff opposes this. He says the first time the idea of a trust was mentioned was at trial. It should be specifically pleaded and isn’t. The particulars to paragraph 14 of the further amended defence and counterclaim are insufficient. He says all his actions were directed to obtaining a lease for himself and his wife. The only reason Lydia’s name is on receipts was for accounting purposes for the ULC. He says there is no obligation in custom to look after Lydia. Her children are bolstering her claim when they say he promised to hold the land for her.

In my judgment there is a trust but it is not the one suggested by Lydia Louis. I find that Tom and Margaret Louis hold the lease of the property on trust for themselves on the one hand and Lydia Louis on the other in equal shares. This is not a matter specifically pleaded but it is a circumstance within the ambit of the evidence and argument in this case.

Lydia Louis put the sums mentioned into the land. That made her the alienator. When she lost that status the plaintiff’s wife gained priority over any outsiders. This happened because she was of the same family, “...bambae priority I stap wetem you we you wan family blong Mr. Toara Louis...” (Annex J, affidavit of Lydia Louis). Tom clearly wanted to help Lydia and wanted the land to stay within the family. A calculation of the sums expended by each upon the land shews that, roughly, they have each contributed equally. At various times each has regarded him or herself as entitled to rent out rooms and collect rents, even though there were disputes. The defendants, other than Lydia, have contributed nothing. There is no basis upon which they can be regarded as having any interest in the land.

Lydia is entitled to have that trust enforced and the land divided. I therefore order that the land is divided into two equal parts by a boundary running at ninety degrees to the boundary along the edge of the road. If this goes through the middle of room then that is where the boundary will be. The parties might have to build fresh walls along that line.

This will necessarily mean the surrender of the current lease and the issue of two new ones. Any expenses involved in the surrender will be paid equally. The expenses of the issue of two fresh leases will be borne by the party concerned.

The plaintiff will have the choice as to which half he will have.

There will necessarily be problems concerning two supplies of electricity and water. If the supply is on the half chosen by the plaintiff then Lydia Louis must pay for the supply to her half. If the supply is on Lydia’s half then Tom Louis must pay for the supply to his half.

There is to be no trouble or any damaging of property. Anyone who does that will be brought before the Court to consider punishment for contempt.

The plaintiff can chose which half he wants before the leases are issued. He must give notice in writing to the defendant’s lawyer. The defendants then have 14 days to leave that half of the property. If a room is divided in two then it cannot be occupied by either party until there is a dividing wall.

I will hear the parties on 13th March at 3.30 p.m. about the making of an Enforcement Order to give dates for the division and questions of costs. There must be no trouble from either party. If there are difficulties in the surrendering and issuing of leases the matter is to be returned to the Court.

Dated at Port Vila, this 26th day of February 2003.

R. J. COVENTRY

Judge.