Introduction
Facts
Decision
Principles of law
Comment
"Possession is nine-tenths of the law" - a concept known to both lawyers and laymen - is of particular merit when considered in relation to a lawful claim over property. However, in India, unscrupulous elements often abuse the legal process in order to enter into (or continue in) possession of property and to claim a title or interest that they do not possess. As the ensuing litigation often takes decades, owners can often be denied enjoyment of their properties and suffer substantial hardship and loss.
In many cases the perpetrators are employees, family members or caretakers, who have been granted the free use (or use out of some necessity or obligation) of a property for a limited period in the absence of the owner. The motivation to usurp property further arises from an awareness of the statute of limitations, which prescribes a period of 12 years in which an owner may enforce his or her right to recover possession, and the lengthy delays in courts of law in adjudicating such claims.
One such case was the subject matter of a recent appeal(1) heard by a bench of the Supreme Court. On March 21 2012, after considering the facts, the court not only held in favour of the lawful owner, but also considered generally the gravity of such unlawful claims and their effect on owners and the property market.
Maria Margarida Sequeira Fernandes purchased a property in Goa, India, in a court auction and became the exclusive owner in 1968. At the request of her brother, Erasmo Jack de Sequeira, she permitted him to act as caretaker of the property while she was living elsewhere.
Although de Sequeira and his family vacated the property in 1991 and handed it over to Sequeira Fernandes, he left certain goods behind. When she returned with her family in 1992 to occupy the property, de Sequeia filed a special civil suit (131/92/A) in the Court of Civil Judge, Senior Division, Panaji, requesting a permanent and mandatory injunction under Section 6 of the Specific Relief Act 1963, on the grounds that he was in lawful possession of the property and had been forcibly dispossessed on June 15 1992. An ex parte order was passed against Sequeira Fernandes to deposit the keys in court, despite the inquiry officer of City Survey Tiswadi, Panjim, Goa holding that she held both title and possession.
Sequeira Fernandes thereafter filed a civil revision application (3/2009) in the High Court of Bombay, Goa Bench, wherein an order was passed on May 5 2009 upholding the decision of the trial court. Aggrieved by the order, she filed a special leave petition (15382/2009) in the Supreme Court, later converted to the present appeal.
The Supreme Court, after examining the facts, set aside the orders of the high court and trial court, holding that de Sequeira was not a tenant, licensee or even a person in unlawful possession of the property. Furthermore, a servant could not have any interest in property and could not exercise possession (or right to possession), so as to exclude the master and real owner from his or her possession or from exercising a right to possession. de Sequeira was thus ordered to vacate the property within three months and to hand over the vacant possession to Sequeira Fernandes.
In its ruling the Supreme Court reiterated the following principles of law:
- No one acquires title to property merely by being allowed to stay for free, even through possession over a long period of time.
- Caretakers, watchmen or servants can never acquire an interest in property, irrespective of lengthy possession, and must vacate on demand.
- Courts are not justified in protecting the possession of a caretaker, servant or any person who is allowed to live in the property for a lengthy period.
- Court protection can be granted or extended only to a person who holds a valid and subsisting rent, lease or licence agreement. (Although not specifically stated in the judgment, protection is at times available to lessees or tenants who hold over after the expiry of the lease.)
- A caretaker or agent holds property of a principal only on behalf of such principal and acquires no right or interest whatsoever for himself or herself in such property, irrespective of a lengthy stay or possession.
While the Supreme Court upheld a well-settled legal position and reiterated the principles of law involved, it more significantly delved into the malaise of protracted litigation involving such false claims. It acknowledged that the primary mandate, burden and duty of courts and the Indian judicial system is to "discern and find out the real truth" and mete out justice expeditiously.
In light of this principal objective, it commented that false claims and defences are serious issues in real estate litigation, predominantly due to escalating prices. It also observed that litigation relating to valuable real estate is often dragged out by unscrupulous litigants hoping to wear down the owners and ultimately to settle for substantial amounts, and that such situations arise due to protracted delays in adjudication by courts.
The Supreme Court considered a number of legal principles, as well as Indian and foreign judgments and foreign judicial systems, and expounded the following guidelines with respect to disputes over possession:
- Possession is important when no title documents or other relevant records are provided before a court. However, once documents or records of title have been produced, title must first be examined and given due weight. Possession therefore cannot be considered in a vacuum.
- Possession in the past may be verified, but the right to remain or continue in possession must be considered separately. The latter has seen much abuse and misuse before courts.
- In an action for recovery of possession (or for protecting possession), once title had been established, the possession or occupation of a person other than the titleholder will be presumed as subordinate to legal title. The person resisting the claim for recovery of possession, or who claims the right to continue in possession, must establish that he or she holds such right.
- A person claiming a right to continue in possession must file specific pleadings, along with documents to support the claim and details of subsequent conduct, to establish the possession.
- If pleadings do not provide sufficient details, courts may reject the claim or pass a decree on admission.
- In a suit for a mandatory injunction, the court is obliged to dispose of an application for injunction as expeditiously as possible. However, courts must critically examine pleadings and documents and pass orders of injunction considering pragmatic realities, including prevalent market rents for similar properties. The court's primary concern must be to carry out substantial justice. Therefore, even if in an extraordinary case it decides to grant an ex parte and interim injunction in favour of a person who does not hold clear title, such person should undertake to pay market rent from the date on which the injunction is obtained (in case the suit is later dismissed).
- In order to avoid abuse of the process of law, courts may also record in an injunctive order that if the suit is eventually dismissed, the plaintiff will undertake to pay restitution, actual or realistic costs.
The Supreme Court should be commended on this bold and groundbreaking judgment. Rather than merely limiting itself to ruling on the specific petition, it has consciously admitted the blatant and regular misuse of courts and the shortcomings of the judicial system. While it would have been easy to place blame squarely on the shoulders of unscrupulous litigants and the lawyers who advise them, it has frankly and openly acknowledged the role of courts as the primary stakeholder responsible for ensuring justice.
There is therefore little doubt that the guidelines and principles set forth in the judgment will assist many hapless owners who have been denied justice for years, and will also deter 'land grabbers' from wrongfully entering into and/or remaining in possession of properties to which they have no right or title, as they must now consider possible substantial liability by way of market rents and that their (usual) frivolous, baseless and unsubstantiated claims will be subjected to greater scrutiny by courts.
For further information on this topic please contact Viren Miskita or Mani M Miskita at MT Miskita & Company by telephone (+91 22 2204 4238), fax (+91 22 2282 8456) or email ([email protected] or [email protected]).
Endnotes
(1) Sequeria Fernandes v de Sequeria (Dead) through LRs, 2012(3)SCALE550.