Patterson and Another v Kanji (Civil Appeal No. 83 of 1955) [1950] EACA 106 (1 January 1950)

## H. M. COURT OF APPEAL FOR EASTERN AFRICA

## Before SIR NEWNHAM WORLEY (President), BACON, Justice of Appeal, and MAHON Acting Chief Justice (Tanganyika)

## (1) ALEXANDER GRAY PATTERSON and (2) MOHAMEDRAZA **SULEMAN VERSI, Appellants (Original Defendants)** ν.

## **BADRUDIN MOHAMED SALEH KANJI, Respondent (Original Plaintiff)** Civil Appeal No. 83 of 1955

(Appeal from the decision of H. M. High Court of Tanganyika, Lowe, J.)

Landlord and tenant—Right of occupancy—Oral agreement for monthly tenancy— Governor's approval not obtained—Transaction inoperative—Appeals to the Court of Appeal Ordinance, section 7 (1) (c)—Land Regulations, 1948, regulation 3—Land (Law of Property and Conveyancing) Ordinance (Cap. 114) section 2 (1)—Land Tenure Ordinance (Cap. 113), sections 2 and 9—Registration of Documents Ordinance, section 8-Land Regulations, 1926 (Laws of Tanganyika, 1928, Vol. III, p. 380).

The respondent was the successful plaintiff in an action in the District Court for rent due under an oral tenancy agreement with the first defendant in respect of a house belonging to the respondent. The defence alleged that as the respondent only held the premises under a right of occupancy and, as it was a term of the grant thereof that no letting should be effected without the Governor's consent under regulation 3 of the Land Regulations, 1948, and such consent had not been obtained, the transaction was inoperative. The District Court found that the lease to the first defendant was inoperative by reason of the failure to obtain the Governor's consent under the Land Regulations but not void for breach of the condition against subletting, holding that the defendants were estopped from relying on the fact that the lease was inoperative and entered judgment for the plaintiff. On appeal, the High Court held that regulation 3 only applied to legal documents and did not affect oral agreements and dismissed the appeal.

On appeal to the Court of Appeal it was argued that the High Court was wrong in holding that regulation 3 only applies to transactions which have been reduced to writing, that the letting, being a dealing with an interest in a right of occupancy was inoperative for lack of the approval required by regulation 3 and that the finding of the Resident Magistrate that the first appellant was estopped from invoking the provision of regulation 3 should have been rejected.

*Held* $(22-3-56)$ .—(1) The plaintiff-respondent was seeking to enforce at law a claim against a third party which he could only establish by relying on a transaction declared by law to be inoperative for lack of approval.

(2) There can be no estoppel against an Act of Parliament.

Appeal allowed, Decrees of trial Court and first appellate Court set aside, Resident Magistrate directed to enter a decree dismissing the suit.

Cases referred to: Dyal Singh v. Kenya Insurance Ltd., (1954) A. C. 287; re Stapleford Colliery Co., Barrow's case, (1880) 14 Ch. D. 441; Davenport v. Reg., (1877) A. C. (P. C.)<br>115; Hubble v. Commissioner for Transport, (1952) 19 E. A. C. A. 97; Simpson v. Bloss,<br>7 Taunt. 246; Herman v. Teuchner, (1885) 15 Q. B. D $(1910)$ 1. L. R. 38.

Murray for appellants. Dharsee for respondent.

WORLEY, President.—This is an appeal brought, with leave of the High Court of Tanganyika under section 7 (1) (c) of the Appeals to the Court of Appeal Ordinance, from a judgment and decree of that Court dismissing an appeal from a decree passed in the District Court of Dar es Salaam. The present respondent was the successful plaintiff in the District Court and respondent in the appeal to the High Court: the present appellants were the defendants in the District Court and the appellants in the High Court. The respondent's claim was, as against the first-named appellant, for rent for four, or alternatively five, months at Sh. 1,200 a month allegedly due under an oral tenancy agreement for a house erected by and belonging to the respondent and situate on Plot No. 64, Zavellas Road, Dar es Salaam. The second-named appellant was sued as guarantor. The only plea in defence with which we are now concerned is that contained in paragraphs $\overline{7}$ and 8 of the amended written statement, which read as follows: –

"7. The plaintiff is not the owner of the house referred to in paragraph 4 of the plaint, but holds the premises under a right of occupancy. It was a term of the grant thereof that no transaction of the nature of the lettings or occupation alleged in the alternative in paragraphs 4, 6 $(a)$ and 11 of the plaint should be effected without the Governor's consent. No such consent has been obtained and the transactions are fraudulent, contrary to public policy and void.

8. The said lettings or occupation required the approval of the Governor under the Land Regulations, 1948. No such approval has been obtained and the transactions are in-operative."

Of the issues framed at the trial we are concerned only with the following: —

- "(3) Was consent to the letting obtained under the terms of the right of occupancy? - (4) If not was the necessity to obtain consent waived? - (5) Was approval given under regulation 3 of the Land Regulations, 1948? - (6) What on the facts decided is the legal effect of the transaction? - (7) To what relief are the parties entitled?"

Regulation 3 of the Land Regulations, 1948 (Laws of Tanganyika, 1947–1950) Subsidiary Legislation, page 333) provides as follows: -

"3. No transfer, mortgage, underlease, or bequest of a right of occupancy or of any interest therein nor any dealing therewith in any way whatsoever (other than by way of equitable mortgage by deposit of title deeds) shall be operative unless and until it is approved by the Governor."

(The proviso to the regulation is irrelevant to the present case.)

The facts relevant to the issue raised on this appeal are that the first-named appellant entered into an oral arrangement with the respondent under which he was to rent the suit premises at Sh. 1,200 a month. He went into possession on 1st January, 1953. The second-named appellant guaranteed payment of the rent. We are not now concerned with the period contemplated for the letting. On 31st March, 1954, the first appellant abandoned possession of the house and on the same day gave the respondent written notice of this: it is however conceded that this was not a valid notice to quit.

The respondent originally occupied Plot No. 64 by virtue of a short term (i.e. three years) right of occupancy granted by the Governor under the Land Tenure Ordinance (Cap. 113, Laws of Tanganyika, 1947). This expired on 5th September, 1952, but the respondent held over, presumably on the same terms and conditions though for an indefinite period. Negotiations for the letting of the

suit premises began in September, 1952, and on 31st December of that year the respondent's advocates sent to the Department of Lands and Surveys a belated application for permission to sublet, together with a notification of intention to apply for a 96-year extension of the right of occupancy. In a later letter (23rd February, 1953) the Department was informed that the first appellant was already in occupation of the premises. The expired right of occupancy contained a condition that the occupier should not at any time subdivide, assign, sublet or otherwise dispose of the plot or any buildings erected thereon without the previous sanction of the Governor; but on 10th March, 1953, the Department informed the respondent's advocates that no objection to the proposed subletting would be made in spite of the breach of condition, and that approval had been given to the granting of the long-term right of occupancy for which the respondent had applied. It was suggested (in the same letter of that date) that the long-term grant should be dealt with first and that thereafter a formal agreement to sublet should be executed and submitted for approval. By a letter dated 12th March. 1953, the respondent's advocates agreed to that suggestion. On 19th June, 1953, the respondent was granted the long-term right of occupancy, which also contained a condition against subletting without consent. In the event no formal agreement to sublet wase ever finalized, and it is common ground that the Governor's consent was never given.

The plaint was filed on 16th August, 1954, and the rent sued for was in respect of the months of April, May, June and July, 1954, in arrears and the month of August, 1954, in advance.

I now return to the issues framed in the District Court. Issues $(3)$ and $(5)$ are not now in dispute: no consent or approval was obtained. On issue (4) the Magistrate found that there had been a clear waiver of the breach of the contractual conditions of the right of occupancy. No point has been made of this on the appeal which was argued on the assumption that the waiver did not affect the need to obtain the consent prescribed in the regulation. I therefore express no opinion on this point. As to issue (6), viz. what, on the facts found proved, was the legal effect of the transaction between the parties, the Magistrate held that "the lease to the first defendant was inoperative by virtue of the failure to obtain the approval required by the Land Regulations but not void for breach of the condition against subletting without previous consent, but that the defendants are estopped from relying on the fact that the lease was inoperative." The learned Magistrate's finding on the point of estoppel was based on the rules of English law that a tenant is estopped from denying the title of his landlord and, in an action for rent, is estopped from saying that the lease is not a good one. These rules are made applicable, in a proper case, by section 2 (1) of the Land (Law of Property and Conveyancing) Ordinance (Cap. 114). The learned Magistrate therefore decreed the suit for the plaintiff-respondent for four months' rent with interest and costs.

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The defendants appealed to the High Court on the sole ground that the District Court had erred in law in holding that they were estopped from relying on the provisions of regulation 3; and they averred that it should have held that the "lease" between the parties "was inoperative for lack of the Governor's approval and that consequently neither party had any rights thereunder". The High Court did not deal with the question of estoppel but dismissed the appeal with costs on the ground that regulation 3 has reference only to legal documents and does not affect any arrangement of the nature of the oral agreement made between the parties in this case. The learned Judge's conclusion is summarized in the following passage:-

"There must in my view be a document which becomes operative when the Governor gives his approval and there was no document in the instant case, either when the tenant entered into occupation or when the landlord obtained a long-term right of occupancy or even after that date. If there is no written document it seems to me there is nothing which can be inoperative."

The appeal to this Court is therefore brought on the following grounds:—

1. The learned Judge erred in holding that regulation 3 of the Land Regulations, 1948, applies only to transactions which have been reduced to writing and that there must be a document before the regulation can render a transaction inoperative.

2. The learned Judge should have held that the letting between the respondent as landlord and the first appellant as tenant was a dealing with an interest in a right of occupancy, was inoperative for lack of the approval required by the regulation referred to in paragraph 1 hereof, that no rights arose thereunder and that in consequence the plaint should have been dismissed as against both appellants.

3. The learned Judge erred in failing to reject the finding of the Resident Magistrate that the first appellant was estopped from invoking the provisions of regulation 3 of the Land Regulations, 1948.

I will take grounds $1$ and $2$ together. Before us counsel were agreed that the ground on which the learned Judge decided the appeal did not arise on the memorandum of appeal and was not argued before him. Nor did Mr. Dharsee, if I understood his argument aright, seek to support the decision of the High Court on any ground other than estoppel. Nevertheless I do not think we should set aside or ignore the learned Judge's ruling on the construction of regulation 3 unless we are satisfied that it is wrong in law.

For my part I am so satisfied. I think the error into which the learned Judge fell was in holding that a right of occupancy could not exist apart from the document evidencing its existence, called in the Land Tenure Ordinance (Cap. 113) a "certificate of occupancy". But this, with respect, is not so, as is shown by the definition of "right of occupancy" in section 2 and by the provisions of section 9 of that Ordinance. The definition reads as follows: —

"a right of occupancy" means a title to the use and occupation of land and includes the title of a native or of a native community lawfully using or occupying land in accordance with native law and custom".

and section 9 (1), so far as is relevant, provides: $-$

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"It shall be lawful for the Governor when granting a right of occupancy or when any person is in occupation of land under a right of occupancy or is entitled to a right of occupancy, to issue a certificate thereof under his hand and the seal of the Territory and to require the occupier to sign at the foot thereof acceptance of the terms and conditions of such certificate."

The proviso to section 12 also is only consistent with the view that a native can possess a right of occupancy without having obtained any certificate or other document of title. The learned Judge recognized this but thought the word "title" was used in the definition clause in two different senses: "first, the title deed, in other words the instrument which created the right of occupancy as in the present case; and the second refers to a right of physical occupation". Generally it is reasonable to presume that the same meaning is implied by the use of the same expression in different parts of a section or of a statute. The learned Judge gives two reasons for not drawing the presumption in the instant case: firstly he says: — "That 'title' cannot mean 'right' seems clear because the legislature was defining a right of occupancy and has deliberately omitted the latter words from the definition": and secondly he calls in aid section 8 of the Registration of Documents Ordinance (Cap. 117) which requires the registration of "non-testamentary documents... which purport to create, etc., any right, title or interest, whether vested or contingent to, in or over land", and adds "There the legislature seems to me to use the word 'title' to mean a title deed".

With deference I think both those arguments are fallacious. The Oxford Dictionary gives the first meaning of "title" in its legal sense as "Legal right to the possession of property", with the second meaning "the evidence of such right: title deeds"; and Stroud's Judicial Dictionary 3rd ed., p. 3035, quoting Co. Litt. 345 (b), has "But legally this word (title) include the a right also... and title is the more general word; for every right is a title but every title is not such a right for which an action lieth; and therefore titulus est justa causa possidendi quod nostrum est, and signifieth the meanes whereby a man cometh to land, etc. ...

That is the sense in which in my view the word "title" is used in the definition of "right of occupancy" and I can see no justification for the view that the word is used in different senses in the two parts of the definition.

As to the expression "right, title and interest", it is wholly wrong to attempt to split it up into separate components. I should like here to adapt the language of the Judicial Committee in Dyal Singh v. Kenya Insurance Ltd., reported in 1954 A. C. 287 and to say that the expression is a "single and indivisible phrase," a well-known and well-understood phrase" in the English law of conveyancing. Indeed, if the word "title" in this expression means, as the learned Judge thought, a title deed, i.e. the document evidencing a right or interest, it is difficult to see how it could be described as contingent. Further, the learned Judge's view is inconsistent with the exception in the regulation for dealings by way of equitable mortgage by deposit of title deeds. Such a transaction need not be in writing though it may be evidenced by writing.

I now turn to the third ground of appeal, which is that the High Court should have reversed the Magistrate's finding on the point of estopped. On this, the appellant's argument is briefly that there is no estoppel against pleading a statute: Halsbury's Laws of England 2nd ed., Vol. XIII, para. 455 and Re Stapleford Colliery Co., Barrow's case, (1880) 14 Ch. D. per Bacon V. C. at p. 441. He contended also that the learned Magistrate confused the contractual condition in the certificate of occupancy (which was held to have been waived) with the statutory requirement of approval (which cannot be waived) and, further, misdirected himself by applying English statute and case law as to estoppel against a mortgagor.

It is trite law that a party cannot seek to enforce a transaction "which is in plain defiance of statutory injunction"; Bacon V. C. said in the Stapleford Colliery case (supra): "It is not competent to parties to a contract to estop themselves or anybody else in the face of an Act of Parliament." But Mr. Dharsee has contended that there is nothing in regulation 3 which prohibits him from leasing his right of occupancy or which makes an under-lease inoperative for all purposes unless and until it has been approved.

In support of his argument, he drew attention to the original form of the regulation as enacted in the Land Regulations, 1926 (Laws of Tanganyika, 1928, Vol. III, p. 380), which read: -

"2. Except as herein provided, it shall not be lawful for any occupier to alienate his right of occupancy or any part thereof by sale, mortgage, charge, transfer or possession, sublease or bequest or otherwise howsoever without the consent of the Governor first had and obtained, and any such sale, mortgage, charge, sublease, transfer or bequest effected without the consent of the Governor shall be null and void; provided that this regulation shall not apply to transfers between natives."

He also contended that the provisions of Land Regulation 3 formed part of the contract between the Crown and the respondent and had no greater effect because they appeared in a statute and should be construed as would corresponding words in a lease inter partes: Davenport v. Reg. 1877 A. C. (P. C.) 115 at p. 128: Hubble v. Commissioner for Transport, (1952) 19 E. A. C. A. 97 at pp. 103–4.

For my part I do not think these arguments can prevail. We are not here concerned, as in *Davenport's case* and *Hubble's case*, with the position *inter se* of the Crown and its lessor. In the present case, the true position is that the plaintiff-respondent seeks to enforce at law a claim against a third party which he can only establish by relying upon a transaction declared by law to be inoperative for lack of approval. That, in my opinion, is exactly what he cannot do. Simpson v. Bloss, 7 Taunt. 246: Herman v. Teuchner, (1885) 15 Q. B. D. 561.

Nor do I think that the respondent can get any assistance from the variation in the wording of the 1926 and 1948 Regulations. It is not disputed that the main reason for the change was the practical difficulty of getting the Governor's approval *before* the transaction was put through. How far the present regulation nullifies a dealing which is not subsequently approved may be a matter for argument: such a transaction may still be valid for some purposes, e.g. if there are collateral undertakings. But, at least it is clear that without approval no dealing can operate to effect a sale or mortgage or to create a charge or a sublease.

Lastly, Mr. Dharsee's argument that as the first appellant was inducted into the land by the respondent, he cannot question the right of the latter to grant him a lease, on the principle of estoppel embodied in section 116 of the Indian Evidence Act, is exactly the argument rejected in the Calcutta case of Abdul Aziz v. Kanthu Mallik, (1910) I. L. R. 38 (at p. 572) on the ground that there can be no estoppel against an Act of Parliament.

For these reasons, therefore, I would allow this appeal, set aside the decrees of the trial Court and of the first appellate Court and direct the Resident Magistrate to enter a decree dismissing the suit. The appellants should have their costs of the proceedings throughout.

As the other members of the Court concur, an order will be made in these terms.

BACON, J. A.—I agree.

MAHON, Ag. C. J.—I agree.