SL SC | No relief against dispossession by bona fide purchaser where vendor fails to show retention of beneficial interest

Supreme Court of the Democratic Socialist Republic of Sri Lanka: A Full Bench of Sisira J. de Abrew, L.T.B. Dehideniya and Murdu N.B. Fernando, JJ., dismissed an appeal which was filed before the Court aggrieved by the judgment dated 17-09-2010 of the Civil Appellate High Court which had upheld the decision of the District Court. The Supreme Court had granted Leave to Appeal on 26-08-2011 on four questions of law.

The Plaintiff had become the owner of the land in issue in 1987 and had transferred the land to B.A. Lionel upon Deed as security for a loan obtained by her reserving the beneficial right to herself. In 1994 when B.A. Lionel requested re-payment of the loan she was not in a position to pay back the loan after which the defendant paid the due sum to B.A. Lionel and in return he transferred him the land by deed. The Plaintiff contended that as the beneficial rights were not transferred by her and she continued to live in the same place the land cannot be transferred to which the purchaser who is the second defendant contends that he was a bona fide purchaser. During the pendency of the application in the Magistrate Court the plaintiff had alleged that she was being dispossessed from the land and the magistrate had ordered the restoration of the possession by an order. The second defendant went against the order by the magistrate to the High court and it set aside the said order on the basis that a breach of the peace had not occurred for the Plaintiff to go before the Magistrate. The Plaintiff had appealed to the Court of Appeal against the said Order and on 28-02-2000, the Court of Appeal dismissed the appeal and affirmed the Order of the High Court and held that the Court of Appeal was unable to accept on the material submitted that the land in suit was subjected to a mortgage or that the Plaintiff was in possession of the land in suit at the time the private plaint was filed. While the application in Court of Appeal was pending the Plaintiff went to the District Court from which the instant appeal lies and later the District Court rejected the plant and held that the second defendant was entitled to the land and in appeal, the High Court had upheld the same decision.

The Court while dismissing the appeal explained that in the instant appeal the Plaintiff should have placed relevant evidence before the trial court for the court to reasonably infer from the attendant circumstances, that the beneficial interest was still with her and thus the appeal does not amount to creation of a trust in favour of the Plaintiff and that the Plaintiff has no beneficial interest in the land in suit. [Balasuriya Lekamlage Somawathie v. Severinus Dilano Ranjith Alles, 2019 SCC OnLine SL SC 15, decided on 05-12-2019]

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