Division: IN THE SUPREME COURT
Date: 4 MAY 1964
Before: SARKODEE-ADOO CJ, ACOLATSE AND APALOO JJSC
JUDGMENT OF APALOO JSC
Apaloo JSC delivered the judgment of the court. The facts of the case are, in the main, not in dispute and can be stated briefly. The appellants (who I shall hereafter call the plaintiffs) are the customary successor and head of the family respectively, of the late Thomas Edward Kwofie. On 5 May 1934, the government granted to the late Kwofie, a lease of a plot of land numbered as 101 and said to be situate at Prince of Wales Road, Takoradi, for a term of 99 years. It would seem that the object of the lease was to enable Mr. Kwofie to erect a building. He covenanted with the government in the said lease to erect and complete on the said plot a proper and substantial building within a period of three years from the date of the lease.
It appears that Mr. Kwofie was himself not in funds to erect a building and he therefore sought and obtained the consent of the government to subdemise the plot to Madam Madge Evans since deceased. Accordingly, on 29 September 1945, the late Kwofie by deed, granted to the said Madge Evans, a sub-lease of the aforementioned plot for a period of eighteen years certain, with an option for renewal for a further period of ten years. The plaintiffs tendered that sub-lease in evidence and it was admitted (exhibit Q). The evidence shows that Madam Madge Evans erected a building on the said plot and had, on a date which the evidence does not disclose, sublet parts of the building to the first, second and third respondents. The late Kwofie died on 1 February 1958, and Madge Evans died in London on 26 June 1959, and left a will in which she appointed Edward Randolph Wiltshere (then of Sekondi) and Thomas John Lawrance Evans (the widower) as executors.
The plaintiffs claimed that the sub-lessee committed breaches of covenants which entitled them to forfeit the lease and to re-enter the demised premises. The covenants which the plaintiffs claimed were broken are set out in paragraph 3 of the statement of claim and were sub-numbered (1)-(4). The first, second and third respondents, who are the sub-underlessees in possession, filed a statement of defence in which they denied any knowledge of the said covenants of their breach and disputed the plaintiffs’ right to eject them. On their own application, the executors were joined to the suit as co-defendants. Upon being joined, they lodged a statement of defence, in which, inter alia, they contended that no breaches of covenant had been committed by the late Madam Madge Evans and prayed in the alternative, that if any
such breaches had occurred, they be relieved against forfeiture. The long drawn out battle that was fought in this case was actually fought between the plaintiffs and the co-defendants.
In what strikes me as a careful and well considered judgment, the learned trial judge held that the co-defendants had committed a breach of the covenant to pay rent and on one occasion of the covenant to pay rates. He reviewed the law relating to the equitable relief against forfeiture and after considering a number of decided cases, held that he had an inherent jurisdiction to relieve against forfeiture. Having considered the conduct of the parties and the circumstances surrounding the breach of these covenants, he felt it right to relieve the co-defendants against forfeiture and proceeded to make an order to that effect. Obviously to restore the parties to their original position, the learned judge ordered the co-defendants to reimburse the first plaintiff such sums as he paid in respect of rent and rate with interest at the rate of ten per cent. per annum from the date of such payments. Although it was wholly unnecessary, the court also declared the sub-lease to be valid and subsisting. In order to prove a breach of one of the covenants, namely, failure to render accounts of the rents collected from tenants in the demised premises, the plaintiffs sought to tender in addition to the executed sub-lease (exhibit Q), a copy of what was claimed to be the draft from which the sub-lease (exhibit Q) was engrossed. This was objected to and rejected on the ground that it was not signed by either of the parties and was accordingly not binding on their successors. The plaintiffs, feeling aggrieved at the rejection of that document and at the order granting relief against forfeiture, appealed to this court on six grounds.
When hearing of this appeal commenced before us on 11 March last, counsel for the plaintiffs combined and argued together what appears in the notice of appeal as grounds (iv) and (v). These grounds respectively read as follows:
(iv) The court erred in rejecting documentary evidence tendered to show the full terms of the original sub-lease actually concluded between the parties.
(v) The copy of the sub-lease as registered in the deeds registry was proved to be inaccurate and the court erred in accepting same as conclusive proof of all the terms agreed between the parties.”
It was submitted on these grounds of appeal that as the signed copy of the sub-lease (exhibit Q) was itself a copy and was therefore secondary evidence, the plaintiffs were entitled to have the unexecuted copy also admitted in evidence as another species of secondary evidence since there are no degrees of secondary evidence. In support of this proposition, counsel for the plaintiffs referred us to Phipson’s Evidence (9th ed.) and the old English case of Waldy v. Gray.1 For my part, I feel no difficulty at all in coming to the conclusion that that document was rightly rejected. The avowed object of tendering it, in my judgment, militates against its admissibility. It is difficult to conceive how a person can be held bound by a document which he did not execute especially as the party who sought to tender such document, himself tendered one executed by the parties. The only object which the admission of the rejected document would have served, is to show that the predecessor-in-title of the co-defendants was liable on a covenant which appears in a draft lease and which was not included in the executed sub-lease. There is not an iota of evidence that the executed sub-lease was inaccurate or represented anything but the true terms on which the parties contracted. In my opinion, there is no merit in these two grounds of appeal and they accordingly fail.
It was next contended on behalf of the plaintiffs, that the court erred in law in making a declaration that the sub-lease was valid and subsisting and in granting relief against forfeiture inasmuch as the co-defendants did not counterclaim for any of these reliefs. For authority, counsel relied on the cases of Cholmeley School v. Sewell2 and Cleasby v. Park Estate.3. Counsel also referred us to Chitty’s Queen’s Bench Forms (18th ed.) at page 825 and Bullen and Leake’s Precedents of Pleadings (11th ed.) at page 869. Counsel for the plaintiffs has not sought to suggest that forms of pleadings contained in a text book can have anything approaching the force of judicial authority and if he should sustain his contention, he must show that the two cases cited by him are authority for the proposition put forward. In my judgment, neither case is authority for the argument advanced. The Cholmeley School case (Supra) merely decides that a tenant is entitled to raise by way of counterclaim the question of his right to relief against forfeiture in a lessor’s action and that he need not issue a separate summons for this. In the Cleasby case (supra), the court had to construe a proviso in a tenancy agreement and it held that on a true construction of that proviso, no notice was required before possession of the demised premises could be resumed by the landlord.
I do not doubt that there might be cases in which it would be wrong for a court to grant reliefs which are not sought by way of a formal counterclaim, but in my judgment, this is not one of those cases. The only substantial issue which was debated before the trial court was whether or not this was a fit case for the court in the exercise of its equitable jurisdiction to grant relief against forfeiture. The co-defendants pleaded and took the position that they were entitled to such relief. This the plaintiffs controverted and, in the result, were unsuccessful. Counsel for the plaintiffs has not sought to suggest that the omission of a formal counterclaim worked any injustice on the appellants and he expressly disclaimed any suggestion that he was taken by surprise at the grant of this relief. Had the learned trial judge declined to grant relief on the only ground that this was not sought by a formal counterclaim, he would have erred by determining this case on the form and shutting his eyes to the substance of the matter. I do not think it is necessary for me to repeat the trite expression that equity looks to the substance rather than to the form. In my judgment, the learned trial judge was entitled to grant relief against forfeiture when in substance there was a counterclaim although not so formally asserted.
The contention that the learned judge was not entitled to declare the sub-lease valid and subsisting in the absence of a formal counterclaim had no more merit in it than the argument that the court cannot grant relief against forfeiture without a formal assertion of a counterclaim. The sub-lease in this case was not due to expire until April 1963, and if the option was validly exercised, until April 1973. Had the learned judge acceded to the plaintiffs’ request and enforced the forfeiture, the sub-lease would have determined immediately. As the court declined the order of forfeiture, it followed that the sub-lease remains valid and would run in accordance with its tenor. In declaring that the sub-lease continued to subsist, the court was stating, in my opinion accurately, the position which resulted from its refusal to enforce the forfeiture. I cannot see how it can be the subject of a legitimate complaint by the plaintiffs. In my opinion, there is no merit in ground (2) of the grounds of appeal.
That brings me to the serious points of law raised in ground (1). That ground complained that the breaches of covenant committed by the sub-lessee or her agents “were breaches of a wilful deliberation and unpardonable nature” and that the court therefore erred in granting relief against forfeiture. The breaches of covenant which were proved to have been committed by the sub-lessee were failure to pay ground rent and failure to pay rates. In either case, it was on one occasion only.
It is necessary to see to what extent the plaintiffs’ claim that these breaches were committed deliberately is justified by the evidence. The ground rent which the co-defendants failed to pay was for the period ending October 1959. It seemed to have been the established practice for this rent to be demanded formally by the Lands Department, by a written notice. Some such notice (exhibit 4) appeared to have been sent to the agents of the sub-lease but was returned. The learned trial judge had some misgiving about the genuineness of this notice as it was dated 1 October 1959 but was postmarked 29 September 1959. This notice demanded the ground rent in respect of plot 101. The agents of the sub-lease returned it because they thought it related to another plot 101 rear (exhibit J). That would, in ordinary language, be a mistake on the part of the agent of the sub-lessee. Indeed, that was the view which Mr. Quao, the rent collector of the lands department and the appellants’ third witness, expressed in cross-examination. He said: “When I received exhibits H and J it was obvious to me that Giles Hunt and Co. had made a mistake as the letter exhibit J referred to plot 101 (rear) whereas the demand note was in respect of plot 101 (front).” With regard to the failure to pay rates which was payable in advance, the learned judge obviously accepting the evidence of Mr. Hart, found that this was due to the fact that no demand notices were sent to the agents of the sub-lessee as has hitherto been done. On the facts which the learned trial judge accepted, it would, in my opinion, be a misuse of language to say that either of these breaches was committed deliberately. In my judgment, the plaintiffs have not made it out that these breaches or either of them was committed wilfully or deliberately.
Counsel for the plaintiffs, however, frankly conceded that with regard to the breach of covenant to pay rent, the learned trial judge was entitled in the exercise of his discretion to grant relief against forfeiture. With regard to the rates, however, counsel contended that the court was precluded by authority from granting relief and strongly relied on the case of Barrow v. Isaacs.4 As I understand it, the principle upon which equity proceeded, was that it would give relief against forfeiture for nonpayment of rent, for interest upon its arrears would be a sufficient compensation for the breach of the covenant to pay it, but in the case of other covenants, for example to insure or repair, it would generally refuse relief, as the damage was incapable of exact assessment. Thus the refusal of relief in Barrow v. Isaacs (supra) was understandable since it was the breach of a covenant not to assign without the landlord’s consent and was thus incapable of precise monetary compensation. But the cases, Cage v. Russel5 and Wadman v.
Calcraft,6 show that where full compensation could be made, equity will not allow a forfeiture to attach. In Taylor v. Popham7 Lord Thurlow said: “If the Court can put the parties in the same situation as if the condition had been performed, it will never suffer a forfeiture to attach.” In Mensah v. Grant,8 the West African Court of Appeal, affirming the order granting relief against forfeiture by the High Court at Sekondi, held that the court had an inherent jurisdiction to relieve against forfeiture.
In this case, the result to the plaintiffs by the co-defendants’ failure to pay rates was that they were out of pocket to the tune of ninety-four pounds five shillings (£G94 5s.). This damage is capable of exact assessment and if the court ordered the payment of this sum together with interest to the plaintiffs it would have put the parties in the same situation as if the covenant had been performed. That is precisely what the court has done. It follows from the review of the law which I have made, that the contention that the court cannot, as a matter of law, grant relief against forfeiture for breach of covenant to pay rates cannot be sustained. I hold, as indeed the West African Court of Appeal held in the Grant case (supra), that the court has an inherent jurisdiction to relieve against forfeiture in all cases where the damage is capable of assessment.
That being the law as I conceive it, the plaintiffs, if they should successfully impeach the exercise of the learned judge’s discretion, must show that that discretion was not exercised judicially or that it was exercised on wrong principles of law. This is not an appeal from the learned judge’s discretion to ours. In my judgment, nothing has been said by counsel for the plaintiffs which carries to my mind, anything remotely resembling a conviction, that on the particular facts of this case, the learned judge exercised his discretion otherwise than judicially. It follows that this ground of appeal must also fail.
The last and only other ground of appeal which counsel for the plaintiffs argued with rather less gusto is the rather familiar one that, “The judgment was against the weight of evidence.” The argument urged on this ground of appeal was to the effect that as the sub-lessee’s representatives admitted that Madge Evans granted sub-under-leases to the first, second and third respondents, the onus was on them to prove that the grants were made with the consent of the lessor. It was said that as the co-defendants failed to establish this, the learned trial judge should have held that the sub-under-lease was granted without the sub-lessor’s consent. Accordingly, it was argued, this was a breach of covenant entitling the sub-lessor to re-enter the
demised premises and to forfeit the sub-lease.
In my judgment, this argument is unsound. A person who claims that a forfeiture has been incurred must establish the ingredients entitling him to forfeit. As I see it, to succeed in proving a breach of the covenant not to “sub-let without consent” the plaintiff must prove, firstly, that there has been a sub-letting and secondly, that it was done without the lessor’s consent. The co-defendants admitted the sub-letting and the plaintiffs were relieved from proving that. But they must establish that that sub-letting was done without the late Kwofie’s consent. The plaintiffs led no evidence at all to prove that the sub-under-leases were granted without the late Kwofie’s consent. This may well be due to the fact that the plaintiffs were in no position to say whether or not the late Kwofie consented to the grant. It follows that I must concur in the view which the learned judge expressed on this matter, namely that9:
“As regards the covenant not to sub-let without consent I also hold that the plaintiffs have failed to prove a breach as the plaintiffs would have to prove that the sub-lessor did not give his consent and this would be almost impossible as he is dead and there is no written evidence in support of this.”
That apart, the circumstances of this case convey to my mind, a high degree of probability that the late Kwofie consented to the sub-under-letting. In clause (c) of the sub-lease, Madge Evans covenanted to erect by 30 June 1946, a dwelling-house with stores on the demised premises. The first plaintiff’s evidence shows that the first, second and third respondents who are firms and were sued as such, were in occupation of these stores as sub-tenants. If as seems likely, the stores were sub-let to them soon after their completion in 1946, Mr. Kwofie who died only in 1958, must have known about the sub-letting. There is no evidence that he made any complaint about that and the inference which is apparent to commonsense by his inaction, is that he must have consented to the sub-under-letting. In my opinion, on any view of this case, this ground of appeal cannot succeed. I hold that it fails and with it, the entire appeal. I would accordingly dismiss this appeal with costs.
DECISION
Appeal dismissed.
T.G.K.
