[1951] EACA 17

### COURT OF APPEAL FOR EASTERN AFRICA

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Before Sir Barclay Nihill, President, Lockhart-Smith, Ag. Vice-President, and THACKER, Ag. C. J. (Kenya)

### ABDULALI JIWAJI, Appellant (Original Plaintiff)

# RAMJI JETHABHAI, Respondent (Original Defendant)

## Civil Appeal No. 56A of 1950

(Appeal from the decision of H. M. Supreme Court of Kenya-Modera, J.)

Sale of land—Misrepresentation of situation—Fraud—Whether parties *ad idem*— Power to deprive successful party of costs.

The plaintiff sued the defendant for specific performance to buy a plot of land near Mombasa. The defendant claimed that he had been induced to enter into the contract by fraudulent misrepresentations concerning the exact situation of the plot. The learned trial Judge held that the defendant had failed to establish fraudulent misrepresentation but dismissed the plaintiff's action on the ground that the parties were never ad idem. Each party was ordered to pay his own costs.

The plaintiff appealed on the ground that in view of the evidence it should have been held that there was no mistake by either as to the whereabouts of the plot and specific performance should have been decreed.

The defendant appealed, in a cross-appeal, against the order that he should pay his own costs on the ground that he had been wholly successful in the suit and should have been granted costs against the plaintiff.

Held $(21-3-51)$ .—(1) That on the evidence the learned trial Judge was entitled to come to the conclusion that the plaintiff's conduct, while not fraudulent, constituted such a material misdescription of the property as to permit avoidance of the contract.

Appeal dismissed.

(2) That although the defendant had been wholly successful the Judge's discretion to deprive him of his costs had been judicially exercised. For it was apparent from the judgment that on certain aspects of the case he entirely disbelieved his evidence.

Cross-appeal dismissed.

Cases referred to: White v. Bradshaw, Dart on Vendors & Purchasers (Vol. 1) Eighth Edn., p. 134; Stanton v. Tattersall, 65 E. R., p. 231 and 234; Price v. Macaulay, 2 D. G.<br>Mac & G., p. 346.

#### Christie for the appellant.

O'Brien Kelly for the respondent.

JUDGMENT (delivered by SIR BARCLAY NIHILL, President).-In this case the plaintiff appellant brought an action for specific performance in the Supreme Court of Kenya on a contract relating to a sale of land situated on the mainland in the vicinity of the island of Mombasa. The defendant respondent in his defence alleged that he had been induced to enter into the contract by reason of a fraudulent misrepresentation by the plaintiff and he sought relief on that ground. The learned trial Judge held that the defendant had failed to establish that the plaintiff was guilty of any fraudulent misrepresentation but he neverthe plaintiff's action on the ground that the parties were never ad idem. It thus becomes necessary to explore the difficult country which

surrounds the circumstances under which a purchaser of land can avoid his contract on the ground of innocent misrepresentation or mistake. With great respect to the learned trial Judge I have found this examination the more difficult because it is not easy precisely to sort out from the judgment any very clear findings of fact on certain important matters. For example on one issue which was in dispute the learned Judge came to no finding at all. Was the certificate of title, with survey plan attached of the appellant's plot shown to the respondent at the plaintiff's office before he wrote the offer contained in Exhibit $1_A$ ? The plaintiff said in his evidence that the defendant said he wanted to see the certificate of title and that in consequence he went to his home and got it and showed it to the defendant and that then he made an offer of Sh. 2,000 per acre. According to the defendant, however, when he asked for the certificate of title the plaintiff sent someone to get it but this person returned saying that he could not find it. A finding on this conflict of evidence would have been of great assistance and without it is by no means easy to determine whether in fact there was a misrepresentation by the plaintiff in the sense that he wilfully acquiesced in a mistake which he knew the defendant was labouring under. I have no clue as to which version of the facts the learned Judge would have accepted had he addressed his mind to this point except that it occurs to me, that had the learned Judge thought that the defendant really did ask to see the certificate of title and was put off by some pretext or other, it would have been difficult for him to come to the conclusion which he did, that there had been no fraud on the part of the plaintiff. Conversely I find it difficult to resist the force of Mr. Christie's contention that if in fact the defendant did see certificate of title and its attachment before he made the offer it is hard to see how the parties were not *ad idem*. However, as there is no finding by the learned Judge on this most material conflict in the evidence I proceed with my judgment on the basis that it was not established whether the defendant did or did not see the certificate of title.

It is now time to state the facts about which there can be no question. It appears that the defendant was looking for a plot on the mainland on the north-west of the island of Mombasa to the east of the aerodrome commonly known as the Port Reitz Aerodrome. There was evidence that land in this area has appreciated greatly in recent years and that it has become a desirable residential area. There is a modern hotel known as Port Reitz Hotel in the vicinity as well as residences occupied by Europeans of standing. There was also evidence from which I think the learned Judge could quite reasonably conclude that it is this area, that is to say land to the east of the aerodrome which is popularly known as the Port Reitz area. Now the appellant's plot lies some miles to the north-west of this area in an area which is not at present a desirable building area at all and which is difficult of access. That it is, however, washed by the waters of the Port Reitz, seems to me quite clear from the maps produced in this case, for the fact of the matter is that the words "Port Reitz" is a designation given to all that inlet of the sea which lies to the west of the island of Mombasa and not merely to the anchorage to the immediate south of the area of land now popularly known as the Port Reitz area. The point is important because on it Mr. Christie rests his submission that when the respondent headed his written offer "Port Reitz Plot" there was no obligation on the plaintiff to interpose and say: "But it isn't a Port Reitz Plot". According to Mr. Christie in the sense that the plot faces the waters of Port Reitz it is in fact a Port Reitz plot, although that is an inaccurate description of locality because there is no area of land on the mainland to which the designation "Port Reitz" has even been officially given. Whether this submission can prevail depends upon ascertaining exactly what the defendant said to the plaintiff during the course of the negotiations. We know what the defendant was looking for but how far did he communicate his objective to the plaintiff? Here again the learned Judge's findings at first sight seem to favour the appellant's case rather than the respondent's. He is not prepared to accept it as proved that the defendant went any further with the plaintiff or his brother than to refer to the Port Reitz area, he was not satisfied that the defendant mentioned Kipevu Camp or the houses of Mr. Cooke and Mr. Daneu, that is to say buildings which would have clearly identified the whereabouts of the locality in which the defendant was seeking for a plot. The plaintiff told the defendant that he had a plot at Port Reitz and it is not in dispute that the plaintiff showed defendant a blue print which was put in as exhibit 3. The defendant stated in his evidence that he did not understand this plan and having looked at it myself I can well believe him. One thing on the plan, however, should have caught his eye and that is the words "Port Reitz" in large letters at its base. Again these words are important when assessing whether the plaintiff had an intent to deceive the defendant when he told him that he had a plot at Port Reitz. The puzzle in this case is that the learned Judge has not found an intent to deceive for had he done so he must have accepted the defendant's allegation of fraud. Mr. O'Brien Kelly has argued that in effect the learned Judge's judgment amount to a finding of fraud but I cannot accept this because the learned Judge specifically stated that he was not convinced that fraud had been established and he emphasized this by depriving the defendant of his costs. Nevertheless the learned Judge found in clear terms, to quote from his judgment that "it was upon the basis of Port Reitz-Port Reitz area or Port Reitz locality that the negotiation proceeded" and I can only conclude from this passage that the learned Judge was convinced by the evidence that the appellant knew quite well the locality where the respondent was seeking a plot and knew equally well that his plot was not in that locality. He nevertheless allowed the respondent to make his offer knowing full well the misapprehension under which the respondent was labouring. The learned Judge has not put his finding quite in these terms but I am satisfied that that is what he meant and there was evidence before him on which he could quite reasonably come to such a view. Moreover in addition to those witnesses who considered it wrong to describe the suit plot as a Port Reitz plot because it does not lie in what is popularly known as the Port Reitz area, there was evidence that the respondent's offer was as much as 50 times more than the market value of the suit plot, whereas the offer of Sh. 2,000 per acre was not far below the market value of land in the vicinity of Kipevu Camp. In such circumstances it seems idle to suppose that the appellant was not fully aware of the mistake at the time the respondent reduced his offer to writing. This being so, in spite of the lucid and forceful arguments advanced by Mr. Christie, I find it impossible to say that the learned Judge was wrong in concluding that the appellant's conduct was such, that if not fraudulent, did in effect constitute such a material misdescription of the property as to permit avoidance of the contract.

A good many cases have been cited to us but as each depends upon its own facts none of them is precisely in point.

In the Brighton Regency Square case White v. Bradshaw reviewed by Dart on Vendors and Purchasers (Vol. 1, Eighth Edn. at pages 134 and 135) a purchaser was held to his purchase because, although after the auction he discovered that the house was not actually in the Square at all but in a side street commanding no sea view and was a smaller house than the houses in the Square, the property had been correctly described by its usual and known description, viz. 39 Regency Square. It was the purchaser's misfortune that he had not inspected the premises before making his bid. The case has points of resemblance with the facts now before us but I think it is distinguishable. The correct description of

the suit plot according to the certificate of title is not "Port Reitz Plot" but Changamwe-Miritini, and whether the appellant showed the certificate of title to the respondent or not, he allowed him to make his offer on the basis that it was an offer for a Port Reitz plot. Moreover in the Regency Square case it is evident that the Court took into account that as it was a sale by auction, the vendor would have lost the advantage of the earlier biddings if the sale had been set aside. No such consideration applies in the present case, where equity is certainly on the side of the respondent. In my opinion this case comes nearer to the 58 Pall Mall case Stanton v. Tattersall, 65 E. R. at 231 and 234 where the ordinary description had been so amplified as apparently to involve an assertion by the vendor that the premises actually occupied a specified desirable locality whereas they did not. The Court held there had been a material misdescription. So here, if one takes into account (a) that the respondent asked for a plot in Port Reitz area; (b) that the appellant must have known that by Port Reitz area the respondent meant the locality to the east of the aerodrome, then I think that the appellant's conduct both in what he said and what he did not say amounted to a misdescription which did induce into the mind of the respondent the mistaken belief that the suit plot was actually in a specified desirable locality where it was not, and was thus in fact a misrepresentation calculated to induce a belief of the value of the property not warranted by its nature and circumstances (Price v. Macaulay, 2 D. G. Mc & G. page 346). For these reasons I would dismiss this appeal with costs.

There is also a cross-appeal before us on the question of costs (Civil Appeal No. 56 of 1950). At the conclusion of his judgment the learned Judge made the following order: $-$

"The plaintiff's suit is dismissed. Neither party has succeeded in discharging the onus which he undertook to discharge. I can discern no merit on either side. There will be no order as to costs."

By this order I assume the learned Judge meant, and I am informed that the parties have so understood it, that each party should bear its own costs.

With great respect to the learned Judge I was at first a little puzzled to discover the reasons why, the defendant having succeeded in his objective, namely the avoidance of the contract, he was deprived of his costs as the successful party. It is true that the defence pleaded fraud which was not established but the defendant did prove enough about the plaintiff's conduct to enable him to succeed. However, in a matter of costs a trial Judge has a discretion and unless it is patent that discretion has not been exercised judicially an Appeal Court cannot interfere unless of course it sets aside the judgment of the Court below where costs have been awarded to the successful party. There is nothing in the present case which suggests for a moment that the trial Judge did not exercise his discretion in a judicial manner, for it is apparent from his judgment that he was not impressed by the defendant's conduct during the progress of the case. In one or two particulars he entirely disbelieved his evidence. That was a factor concerning which the learned Judge was entitled to take notice and I would therefore dismiss the cross-appeal with costs.

LOCKHART-SMITH, Ag. Vice-President.—I entirely agree and have nothing to add.

THACKER, Ag. C. J. (Kenya).—I agree.