004-SLLR-SLLR-1987-1-DHARMAWARDENA-v.-WALWATTAGE.pdf
DHARMAWARDENA
v.
WALWATTAGE
COURT OF APPEAL.
G. P. S. DE SILVA. J. (President, C/A) AND DHEERARATNE, J.
C.A. 462/79-D. C. MT. LAVINIA, 156/ZL.
SEPTEMBER 25. 1986.
Landlord and tenant-Contract of tenancy tainted with statutory illegality-Whethereffective to create rights-Application of maxim in pari delicto potior est conditiodefendentis.
The plaintiff instituted action for a declaration of title to the premises in suit, forejectment of the defendant, for an order on the defendant to demolish the'unauthorised shed’ occupied by her and for damages. The defendant claimed that shewas the lawful tenant of the premises in suit having first come into occupation under theplaintiff's father. The plaintiff's position was that the premises were unauthorised underthe provisions of the Housing and Town Improvement Ordinance and that accordinglythe contract of tenancy was illegal being in breach of statutory provisions.
Held-
One of the essential requisites of a contract of letting and hiring is that the thing shouldbe capable of being let. A lease like any other contract must be legal; it must not beprohibited by statute. An illegal lease is invalid on account of its content. In the instantcase there is an express statutory prohibition in the Housing and Town ImprovementOrdinance against the occupation of a building in respect of which no certificate ofconformity has been obtained. The premises in suit was such a building and the landlordcould not have delivered to the tenant the use and occupation of the premises let as isrequired in a contract of letting and hiring. The contract of tenancy is tainted withstatutory illegality and is ineffective to create rights.
The provisions of the Rent Act do not apply to a contract of tenancy rendered illegal bystatute. The applicability of the maxim in pan delicto potior est conditio defendentis isconsidered.
Cases referred to:
Victorian Daylesford Syndicate Ltd. v. Dott-1905, 2 ch. 624 at 629.
Fernando v. Ramanathan-(1916) 16N. L. R. 337 at 343.
Mohideenv. Saibo-(1917) 17N. L. R. 17.
In Re-Arbitration between Mahmoud and lspahani-( 1925) 2 K.B. 716.
Theivendran v. Ramanathan Chemar-f 1986) 2 Sri L.R. 219.
Jajbhayv. Cassim-S A.L.R. (1939) A. D. 537 at 550.
APPEAL from a judgment of the District Court of Mount Lavima.
M S M. Nazeem. P C. with M. Sivananthan for the plaintiff-appellant.6. G. Mendis with P V. E. Gunadasa for the defendant-respondent.
Cur adv. vult.
October 31,1986.
G. P. S. DE SILVA, J. (President, C/A)
The plaintiff instituted this action in 1 976 for a declaration of title tothe premises in suit, for ejectment of the defendant, for an order onthe defendant to demolish the unauthorised shed occupied by her,and for damages. In her plaint she set out the devolution of title andaverred that her mother who was the owner of the propertytransferred it to her in 1974. It was her case that the defendant is inoccupation of an unauthorised shed and it was her deceased fatherwho originally permitted her to temporarily occupy it. In short, herposition was that the defendant was no more than a licencee and thepermission given was withdrawn by a notice dated 19.7.1S76 (P 14).
The defendant in her answer pleaded that she was a tenant whofirst came into occupation of the premises in suit in 1965 under theplaintiff's father. She denied that she was in occupation of atemporary shed and she produced six rent receipts issued by theplaintiff's father (D1 to D6). It transpired in evidence that the plaintiff'sfather had filed an action in March 1969 for the ejectment of thedefendant from the premises in suit and for the recovery of arrears ofrent (vide the plaint marked D7). Thereafter in August 1972 theplaintiff's mother sought to eject the defendant and recover arrears ofrent (vide the plaint marked D8). Both actions were withdrawn.
At the trial, while the defendant took up the position that she wasthe tenant of the premises in suit since 1965, the plaintiff's positionwas that the defendant was not entitled to remain in occupation ofpremises since the premises were unauthorised under the provisionsof the Housing and Town Improvement Ordinance (Chap. 268). Inother words, the case for the plaintiff was that the contract oftenancy, relied on by the defendant for her right to continue inoccupation, was illegal as it was in breach of the statutory provisions.
The District Judge held:
that the plaintiff is the owner of the premises;
that the defendant is in occupation not of a temporary shedbut of a house with 3 rooms;
that the construction of the said house was not in accordancewith the provisions of the Housing and Town ImprovementOrdinance;
that the defendant entered into occupation of the premises as atenant under the plaintiff's father; and
that the contract of tenancy was lawful.
While granting the plaintiff a declaration that she is the owner of thepremises, he refused the decree in ejectment prayed for by theplaintiff. Hence this appeal preferred by the plaintiff.
At the hearing before us it was not disputed that the plaintiff is theowner of the premises, nor did Mr. Mendis, counsel for thedefendant-respondent, challenge the finding of the District Judge thatthe premises occupied by the defendant were not authorised in termsof the provisions of the Housing and Town Improvement Ordinance(hereinafter referred to as the Ordinance). The principal contentionadvanced by Mr. Nazeem for the plaintiff-appellant was that thealleged contract of tenancy was invalid for illegality inasmuch as itcontravenes specific provisions of the Ordinance. Mr. Nazeemreferred us to sections 5, 13, 15(1) and 1 5(3) of the Ordinance.
Section 5 reads thus:
“5. No person shall erect or re-erect any building within the limitsadministered by a local authority, except in accordance with plans,drawings, and specifications approved in writing by the Chairman."
Section 13(1)(c):
"Any person who shall execute any building operation in
contravention of any of the provisions of this Ordinanceshall be
liable on summary conviction to a fine not exceeding Rs. 300 and toa daily fine of Rs. 25 for every day on which the offence is continuedafter conviction."
Section 15(1):
"No building constructed after the commencement of thisOrdinance shall be occupied, except by a caretaker, until theChairman has given a certificate that such building, as regardsconstruction, drainage, and in all other respects, is in accordancewith law."
Section 15(3):
"Any person who occupies or allows to be occupied any buildingin contravention of this section shall be guilty of an offence, andshall be liable to a penalty not exceeding twenty-five rupees for eachday during which the contravention continues."
Dr. Tambiah in his "Landlord and Tenant in Ceylon" citingVanderlinden and Maasdorp states that one of the essential requisitesof a contract of letting and hiring is that "the thing should be capable ofbeing let" (pages 2 and 3). Similarly, Cooper in his work entitled TheSouth African Law of Landlord and Tenant' says:
t
"A lease like any other contract must be legal; it must not be
prohibited by statuteAn illegal lease is invalid on account of its
content, not its formThusif the letting of the property
requires the consent of an official and his consent has not been
obtainedthe lease, because of its content is illegal" (pages 10 &
11).
In the instant case, be it noted, that both the person who occupiesand the person who allows another to occupy a building in respect ofwhich no certificate of conformity has been issued is guilty of anoffence and is liable to a continuing penalty for each day during whichthe contravention continues. Thus it is clear that there is an expressstatutory prohibition against the occupation of such a building. Once alease is entered into, it is the duty of the landlord to deliver to thetenant the use and occupation of the premises let. This could not havebeen lawfully done in the instant case.
Buckley, J. in Victorian Daylesford Syndicate Limited v. Dott (1) (acase dealing with the Money Lenders Act 1900) stated the principlethus:
"The next question is whether the Act is so expressed that thecontract is prohibited so as to be rendered illegal There is noquestion that a contract which is prohibited, whether expressly or byimplication, by a statute is illegal and cannot be enforced. I have tosee whether the contract is in this case prohibited expressly or byimplication. For this purpose statutes may be grouped under twoheads-those in which a penalty is imposed against doing an act forthe purpose only of the protection of the revenue, and those inwhich a penalty is imposed upon an act not merely for revenuepurposes, but also for the protection of the public. That distinction
will be found commented upon in numerous casesIf I arrive
at the conclusion that one of the objects is the protection of thepublic, then the act is impliedly prohibited by the statute, and isillegal. I desire to point out that the present case is one that is uponthis point abundantly plain. There is no question of protection of therevenue here at all. The whole purpose is the protection of thepublic. The money-lender has to be registered, and has to trade inhis registered name obviously and notoriously for the protection ofthose who deal with him. The purpose is a public purpose, andtherefore upon all the authorities the act for the doing of which apenalty is imposed is an act which is impliedly prohibited by thestatute and is consequently illegal."
Wood Renton, A.C.J. in Fernando v. Ramanathan (2) expressedhimself in the following terms:
"Whether in any enactment the Legislature has prohibited aparticular contract or act is a problem that has to be solved in thelight of the letter and spirit of the provisions of that enactmentviewed as a whole. Although a contract or act may be made illegalby a statute passed for the protection of revenue alone, thepresumption of illegality will be greater where the statute is oneembracing other important objects of public policy as well, andwhere it contains prohibitory language, besides imposing a penalty."
The ruling in the above case was followed in Mohideen v. Saibo (3).
The long title of the Ordinance we are here concerned with showsthat the object is "to provide for the better housing of the people andthe improvement of towns". The Ordinance read as a whole showsthat it is primarily intended for the protection of the public and the
imposition of the penalties is not for the purposes of revenue"if
an act is prohibited by Statute for the public benefit the court mustenforce the prohibition, even though the person breaking the law reliesupon his own illegality" (per Scrutton, L.J. In Re-Arbitration betweenMahmoud and Ispahani (4)).
Having regard to the ambit and the intent of the Ordinance, I am o'the opinion that the contract of tenancy upon which the defendamfounds her claim to occupy the premises is tainted with statutoryillegality and is therefore ineffective to create rights. The principle is
that"when the legal title to the premises is admitted or proved to
be in the plaintiff, the burden of proof is on the defendant to show thathe is in lawful possession" (per Sharvananda, C.J. in Theivandran v.Ramanathan Chettiar{5). This the defendant has failed to do.
However, the conclusion that the contract of tenancy is illegal doesnot necessarily mean that the plaintiff is entitled to a decree inejectment. There is a further matter to be considered, namely theapplicability of the maxim, in pari delicto potior est conditiodefendentis, (the defendant's position is superior if culpability isequal). In this connection the provisions of section 5,13 and 15(3) ofthe Ordinance referred to above are relevant. It seems to me that theculpability of the "landlord" is no less than that of the "tenant". But theRoman-Dutch Law recognises that the general rule embodied in thismaxim may be relaxed in cases "where it is necessary to preventinjustice or to promote public policy". {Jajbhay v. Cassim) (6).
The evidence reveals that the unauthorised structure was put upmany years ago by the plaintiff's father (now deceased) who was not apredecessor in title of the plaintiff. The receipts for rent produced bythe defendant were issued by the father and not by the plaintiff'smother or the plaintiff herself. The premises in suit having beenconstructed without the requisite authority is liable to demolition underthe provisions of the Ordinance (section 13(2)). The plaintiff has givenone month's notice to the defendant to vacate the premises (P14).Neither the interests of justice nor the requirements of public policyjustify the continued occupation by the defendant of theseunauthorised premises. Nor do the provisions of the Rent Act apply toa contract of tenancy rendered illegal by statute.
I would accordingly allow the appeal, set aside the judgment of theDistrict Court and direct that decree be entered for the ejectment ofthe defendant, her servants, agents and all those holding under herfrom the premises in suit. However, in all the circumstances I furtherdirect writ of ejectment not to issue till 2nd May 1988. The plaintiff isentitled to costs of appeal fixed at Rs. 210.
DHEERARATNE, J.-l agreeAppeal allowed.