(COURT OF APPEAL)

HEIRS OF UM GADEIN KHALIL v. ABDEIN MORGAN & OTHERS

AC-RFV-93-1967

Principles

Land Law—Customary right of occupation-Occupiers right to compensation for value of building on eviction

   The customary right of occupation can be terminated by eviction and recovery of possession, provided that the owner pays reasonable compensation of the value of the buildings to the occupier.

Judgment

      Advocate: M. I. KhaliI…………………………………. for applicants

        Osman El Tayeb J. October 24,1967: -this is a peculiar revision in which this court is asked to explain the meaning of a judgment and a decree passed by a former Court of Appeal for the purpose of its enforceability in execution proceedings. Applicant is the registered proprietor of 204 sq.m. In the plot known as 33/1(1) Omdurman Town. Respondents were in occupation of the said property. In 1957 the respondents instituted a suit claiming title to this plot by prescription based on their long possession of it. The claim turned to be for customary right of occupation until it reached this court and it made the judgment and decree under consideration, Heirs of Urn Gadein KhaIiI v. Abdin Morgan & Others, AC-REV-257-1963 (1964) S.L.J.R. 159. The relevant parts of the judgment at page 162 are as follows:

          “I have undertaken a careful research into previous decisions by this court to find out whether the exact nature and incidents of the right in question has been defined by this court, but I must admit that my research has proved fruitless.”

          “I can, however, state with some certainty that the right referred to by Lomax J. In Ibrahim Nasir’s case is well recognised as arising out of custom, though its exact limitation is not free from obscurity. Mention of the right occurs once in the Land Settlement and Registration Ordinance 1925, S. 27 says: ‘The customary right of occupation of houses built on the land with the consent of the proprietor or his predecessor in title’ shall, inter alia, be capable of taking effect in reference to land without notification in the register. The proviso to the said section gives a registrar power to direct registration of that right if he thought fit.”

      “The description of the right in the said Ordinance as a “customary” right would support the theory that it is to custom alone that we should resort for the determination of the nature and incidents

Of the right. That would, of course, necessitate the taking of evidence of that custom governing the nature and incidents of that right and in particular the duration of the tenure and how, if at all, it is determinable. In the present case, I think it would be sufficient if this court would declare that claimants are simply entitled to a customary right of occupation, which would entitle them to resume possession of the part claimed if they had already been evicted. It would be a heavy burden now to call upon claimants to have the incidents of that right proved now in anticipation of future differences which may never come to pass.”

      A decree in the form of a declaration was passed as follows: —” There shall be a declaration in favour of respondents that they are owners of a customary right of occupation of the area claimed and covering 204 sq.m. Of plot 33/I (1), Omdurman Town.”

     Respondents sought to execute this decree in execution proceedings (EX-466-1956) The learned District Judge made an order giving the respondents the right to occupy or to continue in occupation of the house. An application for revision to the High Court was made against this order, which was dismissed. The learned Province Judge was of the opinion that the declaration of the existence of the right of customary occupation cannot be enforced except by allowing the respondents to have the benefit and enjoyment of the possession or occupation of the house in question.

    Advocate M. I. Khalil argued before the court that this customary right of occupation must be terminated on the payment of the value of the building by the owner of the house to those persons in whom the right vests. He further submits that the value of the buildings was assessed at £S.200.000m/ms. and that applicants are ready to pay this sum to respondents, and on that ground there must be an order of ejectment to be passed against the respondents. Unfortunately respondents were not represented by legal counsel in this revision, and so we had not had the advantage of hearing argument to the contrary in deciding this difficult matter.

    I may take the liberty of referring to the English case of Inwards & Others v. Baker (1965)1 All E.R. 446, where a son built a bungalow for living in on his father’s estate with the consent and permission of the father. After living there for many years, the executrix of his father tried to eject him in the county court. An order of ejectment was given. But in the Court of Appeal it was refused. Lord Denning, M.R. stated in his judgment:

It is quite plain from those authorities that, if the owner of land requests another or indeed allows another to expend money on the land under an expectation created or encouraged by the landlord that he will be able to remain there, that raises an equity in the licensee such as to entitle him to stay. He has a licence coupled with an equity. Counsel for the defendants urged before us that the licence would not stay indefinitely. The principle only applied, he said, when there was an expectation of some precise legal term; but it seems to me from Plimmer’s case (1884), 9 App. Cas. at pp. 713, 714, in particular, that the equity arising from expenditure on land does not fail,

   ‘ merely on the ground that the interest to be secured has not been expressly indicated.  . . . The court must look at the circumstances in each case to decide in what way the equity can be satisfied.’

     So in this case, even though there is no binding contract to grant any particular interest to the licensee, nevertheless, the court can look at the circumstances and see whether there is an equity arising out of the expenditure of money. All that is necessary is that the licensee should, at the request or with the encouragement of the landlord, have spent the money in the expectation of being allowed to stay there. It so, the court will not allow that expectation to be defeated where it would be inequitable so to do. In this case, it is quite plain that the father allowed an expectation to be created in the defendant’s mind that this bungalow was to be his home. It was to be his home for his life or, at all events, his home as long as he wished it to remain his home. It seems to me that in the light of that equity the father could not in 1932 have turned to the defendant and said: ‘You are to go. It is my land and my house.’ Nor could he at any time thereafter so long as the defendant wanted it as his home.”

    He decided that the son was entitled to remain in the bungalow and not to be ejected. The right declared in this case is very similar to the right of customary occupation; the essentials of which are:

1. that it is customary and quite common for the father to allow his son to erect buildings on his land.

2 . the purpose being that the buildings are required by the son for his living and occupation.

3.   that the son expends money out of his own pocket on the buildings.

     The rule applied to any person in a position of relationship cognate to that of a son or other relative. The relationship of a slave and a master that used to exist in the past was considered as that between a son and a father or other similar relations.

    Where the permission or licence is granted and the licensee spends money out of his funds for the erection of buildings, the right could be established and vest in the licensee. It is, in essence, an equitable right, and in other words it may be called ‘a licence coupled with equity’ as Lord Denning so liked to call it in the English case cited above. In addition to the rule that the spending of money, with consent of the landlord, in the building creates the equitable right, it was held that all the circumstances will count in order to determine or terminate the future of that right. The intention of the father at the time of allowing his son or granting licence to his son to build the bungalow was given great consideration. That intention was found to be an allowance or licence to the son to live and occupy that bungalow permanently without limitation in point of time, as long as he wished.

      Returning to our case, the customary right of occupation, as we understand it, is also an equitable right. It may be a temporary or a permanent occupation. It depends on the circumstances of every case. The relationship of the licensor and licensee and their intentions at the time of granting and accepting the licence, are relevant considerations for determining the nature of the right and its future existence. In our present case where the relationship was that of ex-slave and ex-master the presumption is that the right of customary occupation was granted for a limited period, especially when that relationship has been severed, and no longer exists as of the laws prohibiting slavery. The rule is that every right is subject to termination on certain conditions including reasonable compensation for divesting the person entitled to enjoy that right of it. There is nothing to show that the customary right of occupation can be an exception to this rule. If it is allowed to continue as existing permanently it means on the other hand depriving the holder of the freehold interest in the land of possession and enjoyment of his right without limitation. I do not think that justice and equity permit of such tendencies.

        In the case of El Sheikh Shargawi v. Mastura Bint El Hag Arabi (KH-HC-REV-59-1951) Hayes J. decided that an ex-slave who obtained a customary right of occupation by erecting some buildings on the land of his ex-master, with the consent of that ex-master may be evicted on the payment of compensation equal to the value of those buildings. This decision was applied by Watson J. in the case of Heirs of Abdel Ghani Mohamed v. Zeinab Hassan Omer (Cases in the Court of Appeal and the High Court—Digest No. 16 p. 26). The facts of the two cases are very similar. Watson J. stated the rule as follows:

     “When a master allows a servant to build a house at the servant’s expense on the master’s land, he impliedly grants the servant a right to remain in occupation subject only to a right in the master to evict the servant on payment of compensation. The servant in such circumstances acquires a customary right of occupation of the kind mentioned in the Land Settlement and Registration Ordinance, s. 27 (h)”                                         

       We have to follow these precedents rather than following the English precedent. All we can gain from the latter is the description of the nature of the right but not its extent and the manner of its determination. It is acceptable that the customary right of occupation is in the nature of a licence coupled with an equity, and that it is so means that the licence may be terminated at any time on payment of compensation.

      In the present case, the applicants are entitled to the remedy of termination of the right of occupation acquired by respondents by eviction and recovery of possession, provided that applicants pay reasonable compensation to respondents. It is mentioned in the proceedings that the value of the buildings erected by respondents is £S.2oo.ooom/ms. and this amount was not disputed.

     This application is allowed. The orders of the courts below are set aside and decree has to issue for eviction upon payment of £S.200.000m/ms. by way of compensation.

          No order as to costs.

        El Rayah El Amin C. J. October 24, 1967: —I concur.

        Hassanr Abdel Rahim J. October 24, 1967: —I agree.