Kinoo Sons Ltd v Abdool

[Delivered by Lord Rodger of Earlsferry]

At the time of his death on 26 December 1974 Mr Ally Hossen Abdool owned three contiguous plots of land on David Street, Port Louis. He died intestate and his estate, including the three plots, passed to his ten children. One of his sons died intestate in 1982 and a daughter died intestate in 1986. In both cases their estates passed to their heirs on intestacy. The result was that by 1990 no less than twenty people were the joint owners of the three plots of land.

Article 812 of the Civil Code provides:

"Sous réserve des dispositions de l'article 768, nul ne peut être contraint à demeurer dans l'indivision, et le partage peut être toujours provoqué, nonobstant prohibitions et conventions contraires."

Of the twenty joint owners all but two did not wish to remain in joint ownership and, in terms of article 812, they had a right to have the property divided among them - in practice to have it sold and to have the proceeds shared out among the former joint owners. One of the two who wished to remain in joint ownership was the defendant in the present proceedings, Mrs Bibi Sarah Hossen Abdool. The 18 joint owners therefore petitioned the Master of the Supreme Court of Mauritius for a licitation of the three plots in terms of section 97 of the Sale of Immoveable Property Act. Mrs Abdool was made a defendant in the proceedings. In terms of section 100 the petitioners filed in the Master's Office the memorandum of charges (cahier des charges) under which they proposed to sell the property. The memorandum indicated that the property was to be sold in three lots, the second of which, Lot No 2, was described as "un immeuble terrain emplacement Rue David No. 32 de 97.44 mts de large sur ladite rue et de 129.92 mts de long …". Lot No 2 is the subject of the present proceedings.

As required by section 100(2)(c), the memorandum set out the reserve price and the conditions of the sale. Article 12 of the conditions of sale was in these terms:

"The party/parties prosecuting the sale shall reserve to himself/themselves the right to deposit in the office of the Master and Registrar of the above Court to annexed to his Cahier des Charges, three clear days before the day of the sale a Memorandum of the changes regarding the property/properties to be sold and which may have occurred or been known at the date. The purchaser/ purchasers of the above described property/properties are warned that any of the co-owners may within a delay of one month from date of adjudication exercise a right of substitution of the purchaser or purchasers by making a declaration to the Master's Office and this in compliance with Art 813 of Code Napoleon, Amendment Act No. 3 of Act No. 9 of 1983."

On 13 April 1990, in terms of section 101(1)(a) notice was given to the defendant who was therefore made aware of the conditions of sale, including the terms of Article 12. Under section 102(1)(b) she had the right, within 30 days after the period for notice under section 101 had expired, to object to any of the clauses or conditions of the memorandum of charges. The defendant made no such objection.

The Master originally fixed the sale for 12 July 1990 but it was postponed in the hope that the matter could be settled and, in the end, the sale of Lot No 2 took place on 11 October 1990. The successful bidder was Mr You Nan Wong King Yuen, acting in his own name and in the name of five other persons. The Master awarded them the property comprising Lot No 2 and ordered them to pay the price of Rs 425,000. Four days later, on 15 October, the purchasers appeared before the Master and declared that the purchase had been made on behalf of Kinoo Sons Ltd, the plaintiffs in the present action. As a result of these steps the property in Lot No 2 was awarded to the plaintiffs.

The last sentence of Article 12 of the conditions of sale referred to article 813 of the Civil Code. In reality, the reference was, more precisely, to article 813-13:

"S'il y a lieu à l'adjudication de tout ou partie des droits d'un indivisaire dans les biens indivis ou dans un ou plusieurs de ces biens, l'avoué doit en informer les indivisaires par notification un mois avant la date prévue pour la vente. Chaque indivisaire peut se substituer à l'acquéreur dans un delai d'un mois à compter de l'adjudication, par déclaration au greffe ou auprès de l'avoué.

Le cahier des charges établi en vue de la vente doit faire mention des droits de substitution."

Article 813-13 follows almost word for word the terms of article 815-15 of the French Code Civil on which it is modeled.

On 26 October 1990 the defendant appeared before the Master and declared that:

"in conformity with Article 813-13 and following of the Code Napoleon, she hereby SUBSTITUTES herself in lieu and stead of KINOO SONS LTD represented by Mr ISSOOF KINOO Chairman of its Board of Directors, as purchaser of the said property sold before the Master's Bar in the above matter on the 11th day of October 1990, on outbidding for and in consideration of the sum of Rs 425,000.00."

As a result of the declaration being transcribed, the Conservator of Mortgages caused the ownership of Lot No 2 to be transferred to the defendant's name in the books and registers kept by him. The defendant thus became the owner of the property comprising Lot No 2.

In the present proceedings against the defendant and against the Conservator of Mortgages as co-defendant, the plaintiffs seek a judgment:

"(a) holding and decreeing that the declaration made by Defendant before the Master and Registrar on the 26th October 1990 … is null and void to all intents and purposes;

(b) holding and decreeing that the Plaintiffs are the purchasers of the immoveable property sold by LICITATION at the Master's Bar, under Lot No 2 for and in consideration of Rs 425,000.00;

(c) condemning and ordering Defendant to pay to Plaintiffs the sum of Rs 100,000 as damages;

(d) decreeing that the transcription of the judgment of the Court in the present matter shall constitute a valid title for the Plaintiffs in respect of the ownership of the said immoveable property described under Lot No 2."

On 5 November 1998 Balgobin J gave judgment for the plaintiffs. She held that the defendant's declaration of 26 October 1990 was null and void and that the plaintiffs were the purchasers of Lot No 2. Her Ladyship further found the defendant liable to pay the plaintiffs damages of Rs 20,000. The defendant appealed and on 1 November 2000 the Court of Civil Appeal (Yeung Sik Yuen SPJ and Seetulsingh J) allowed her appeal. The court quashed the decision of the trial judge and declared that the transcription of their judgment was to constitute a valid title for the defendant.

On 29 January 2001 Pillay CJ granted the plaintiffs leave to appeal to their Lordships' Board. At the hearing before the Board the plaintiffs were represented by Mr Jaunbaccus and Mr Ramdhun. Neither the defendant nor the co-defendant was represented.

Both article 815-15 of the French Civil Code and article 813-13 of the Civil Code of Mauritius are of fairly recent origin, the relevant amendments having been made in 1976 and 1983 respectively. They were part of a larger set of amendments regulating the rights of joint owners in considerable detail. To begin with, there was some doubt about the scope of articles 815-15 and 813-13. In particular, it appears to have been thought that the articles applied in a case like the present where joint owners sold all or part of the joint property itself. Two consequences were thought to follow. First, each of the joint owners was thought to have a right, within a month, to substitute himself for the purchaser of the property. Secondly, it was thought to be necessary to include a reference to this statutory right of substitution in the cahier des charges in order to meet the specific notice requirement in articles 815-15 and 813-13 and so to avoid the risk of the licitation being held to be invalid in terms of articles 815-16 and 813-14. In the present case indeed the reference to the right of substitution and to article 813 of the Civil Code may well have been included in Article 12 of the conditions of sale in the belief that the statutory right applied in the case of a sale of the joint property as such.

In France, however, the question of the scope of article 815-15 came before the first chamber of the Cour de Cassation in Epoux Assenat c Chabal 14 février 1989 D 1989 278, note Morin; RTD civ 1989 588, obs F Zénati. M Assenat and his wife owned certain property jointly. M Assenat had been sequestrated and the syndic in his sequestration brought proceedings to have the immoveable property sold and the proceeds divided between the syndic and Mme Assenat. The Assenats sought, however, to have included in the cahier des charges a mention of the right of substitution which joint owners can exercise under article 815-15. The lower court rejected the Assenats' application and they sought to have the judgment set aside on the basis that the position was the same whether it was a sale of the rights of a joint owner or joint owners in joint property or the sale of the joint property itself. The Cour de Cassation upheld the decision of the lower court, however, on the ground that article 815-15:

"ne pouvait être appliqué qu'en cas d'adjudication portant sur les droits d'un indivisaire dans les biens indivis, et non sur les biens indivis eux-mêmes…".

This decision has been followed in subsequent cases, for example, ...