Haroon Rashid Elaheedoccus v. The State of Mauritius

Privy Council Appeal No 75 of 2007

HAROON RASHID ELAHEEBOCUS

Appellant

v.

THE STATE OF MAURITIUS

Respondent

FROM

THE COURT OF APPEAL OF

SUPREME COURT OF MAURITIUS

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JUDGMENT OF THE LORDS OF THE JUDICIAL

COMMITTEE OF THE PRIVY COUNCIL

Delivered the 25^th February 2009

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Present at the hearing:-

Lord Phillips of Worth Matravers

Lord Scott of Foscote

Lord Rodger of Earlsferry

Lord Walker of Gestingthorpe

Lord Brown of Eaton-under-Heywood

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[Delivered by Lord Brown of Eaton-under-Heywood]

Introduction

1. In January 1997 four men conspired together to counterfeit Bank of Mauritius banknotes by means of computers. The four men were Harris Ramful, Maheshwar Ragoobur, Mamode Ally Khodabaccus and the appellant. Ramful and Ragoobur were arrested on 27 April 1997 and both later pleaded guilty and were sentenced to six years’ penal servitude. The appellant was arrested, provisionally charged and remanded in custody on 29 April 1997. On 8 April 1998 he and Khodabaccus were charged before the Intermediate Court. On 17 June 1998 (after thirteen and a half months in custody) he was bailed. On 31 May 2001 the appellant and Khodabaccus were convicted by the Intermediate Court, the appellant being sentenced to four years’ penal servitude, Khodabaccus to three years’ penal servitude. Both appealed against conviction (not sentence). Their appeals were heard by the Supreme Court (Balancy and Caunhye JJ) on 21 June 2004 and nineteen months later, on 20 January 2006, dismissed. On 9 February 2006 the appellant (but not Khodabaccus) sought conditional leave to appeal to the Privy Council (again, only against conviction). On 16 October 2006 the Board delivered judgment in Prakash Boolell v The State of Mauritius [2006] UKPC 46 (Boolell). Prompted by Boolell, at the hearing of the application before the Supreme Court (Balancy and Domah JJ) on 13 June 2007, the appellant sought leave to appeal, not to challenge his conviction, but rather to argue that, because of the delay in concluding his appeal, his custodial sentence should be set aside and replaced by a fine. That application failed. On 24 January 2008, however, the Board granted the appellant special leave to appeal.

2. The appeal accordingly is something of a curiosity. Section 10(1) of the Constitution provides that “Where any person is charged with a criminal offence, then . . . the case shall be afforded a fair hearing within a reasonable time by an independent and impartial court established by law”. Their Lordships are here concerned, as was the Board in Boolell, only with the reasonable time guarantee under section 10; there was no dispute that the hearing was fair and the court independent and impartial. Unlike the position in Boolell, however, there was in this case no suggestion of any breach of the reasonable time guarantee until long after the proceedings in Mauritius had ended with the dismissal of the appellant’s appeal against conviction. As stated, the argument was first advanced on the application, some fifteen months later, for leave to appeal to the Privy Council. What is now submitted is that the Supreme Court should themselves have recognised the breach of section 10 by the time they came to deliver their judgment dismissing the appellant’s (and Khodabaccus’s) appeals on 20 January 2006 and should of their own motion have substituted fines for the custodial sentences by way of redress. Their Lordships reject this submission as misconceived. They are, however, prepared to regard the application to the Supreme Court on 13 June 2007 for leave to appeal to the Privy Council as if it had been (as plainly it should have been) a constitutional motion asserting as at that date a breach of the reasonable time guarantee under section 10, and to regard the appeal presently before the Board as an appeal from the Supreme Court’s decision on 13 June 2007 rejecting such a (notional) constitutional motion.

3. With that introduction their Lordships must now return to the facts although it is quite unnecessary to set these out at any length. This was in truth a comparatively straightforward case of no particular complexity and, unlike the position in Boolell, it involved no delays for which the appellant himself could properly be said to be reprehensibly responsible.

The conspiracy

4. The idea of counterfeiting banknotes was hatched by Ramful in the company of Ragoobur and the appellant. The appellant was at the time working as a clerk for Ramful’s attorney and in that capacity had assisted and become friendly with Ramful whom he knew to be in serious financial difficulty. The appellant assisted Ramful in the purchase of computers, printers and scanners required for the project, by introducing him both to the supplier, a Mr Muttylall, who provided credit facilities for the Rs 20,000 outlay. Khodabaccus was known to both Ragobur and the appellant and he too joined the conspiracy, in turn bringing in a friend, Salim, who was to help finance the scheme. Salim was to provide 75,000 French francs in return for counterfeit notes amounting to Rs5 million. The appellant assisted also by renting a bungalow at Flic en Flac where the counterfeiting operation took place and by sometimes fetching in a technician when there was a computer breakdown.

5. When the police raided the bungalow on 27 April 1997 they arrested Ramful and Ragobur and seized various articles including a computer, scanner, printer, counterfeit banknotes and other computer books and documents as well as a pair of sandals belonging to the appellant. A number of statements were then taken from Ramful which deeply incriminated both the appellant and Khodabaccus. The appellant himself then made a series of incriminating statements.

The Intermediate Court trial

6. The information having been sworn on 8 April 1998, on 15 June 1998 the trial was fixed for 29 October 1998 but on that date was adjourned and refixed for 2 March 1999 because of the late service on the defendants of some 300 pages of statement by the prosecution’s chief witness, Ramful. The trial duly began on 2 March 1999 when three witnesses were called by the prosecution—two police officers whose evidence included a description of the bungalow search and details of the appellant’s subsequent arrest and written statements to the police, and a computer salesman—and ended two years later on 28 March 2001 when Ramful gave his evidence. Between those dates the case was before the Court on seven other occasions, on only two of which however were further witnesses called: 30 October 2000 when other police evidence was given. On the other hearing days the proceedings were adjourned for this or that reason, usually the convenience of counsel on one side or the other, invariably without objection.

7. The major evidence against the appellant consisted of Ramful’s detailed oral evidence fully implicating him in the conspiracy, of admissions made in the appellant’s own statements to the police, and of his presence at the bungalow. No evidence was called by either defendant.

8. As stated, judgment was given by the Intermediate Court on 31 May 2001 convicting the appellant and Khodabaccus and sentencing them respectively to four years and three years penal servitude (together with a costs order against each for Rr500). In sentencing the appellant the Court observed that this was “indeed a serious offence which calls for a severe custodial sentence” and noted that it was “not [the appellant’s] first encounter with justice in connection with offences involving fraud and dishonesty” (whereas Khodabaccus had only one previous conviction, already spent). The appellant indeed had five previous convictions, variously for swindling, embezzlement and forgery between 1990 and 1995, for one of which he had served a two year sentence of imprisonment.

The appeal to the Supreme Court

9. Notice of appeal against conviction was promptly given, the effect of this being automatically to suspend the operation of the sentence, and on 9 July 2001 the Supreme Court Registry notified all counsel that the case would be mentioned on 13 September 2001 for a date to be fixed. On 13 September 2001 the appeal was duly fixed for hearing on 27 May 2002. Successively, however, the appeal was three times removed from the list and refixed for hearing at the request of the appellant’s counsel (on the first two occasions Mr Guy Ollivry QC, who eventually appeared for the appellant on the appeal, on the third occasion, Mr Pyaneandee), delaying the appeal hearing by a total of just over two years: on 23 May 2002 it was adjourned from 27 May 2002 and on 13 June 2002 refixed for hearing on 10 March 2003; on 5 March 2003 it was adjourned from 10 March 2003 and on 13 May 2003 refixed for hearing on 20 October 2003; and on 13 October 2003 it was adjourned from 20 October 2003 and on 23 October 2003 refixed for hearing on 21 June 2004.

10. Eventually, on 21 June 2004, the appeal was heard. On 6 September 2005 a transcript of the appeal proceedings was produced, presumably at the Supreme Court’s own request, over a year having already by then elapsed since the actual appeal hearing and the court’s memory doubtless having faded. Finally, on 20 January 2006 the appeal was dismissed. The Court’s judgment stretches to just under six pages. It records that only two grounds were raised by the appellants, identical grounds in each case: first, that there was “no evidence on record that the appellant conspired to commit the alleged offence” and, second, that the prosecution had failed to call Mr Muttylall. The judgment pointed out that in the appellant’s first three statements to the police he had “substantially confirmed his involvement in the project as per Ramful’s version” albeit in his fourth statement he had said that he had no intention to counterfeit banknotes and was not involved in the operation.

11. The judgment further noted that “the learned magistrates expressed their awareness of the fact that witness Ramful’s testimony was that of an accomplice and had to be viewed with utmost caution. They were however satisfied that he had spoken the truth in Court in view of the convincing manner in which he deponed and especially as they found no motive on his part to lie and level false allegations against the two appellants after he had already been prosecuted and sentenced for offences in connection with the counterfeit notes.” As to Mr Ollivry’s submission that the magistrates were wrong to have preferred the appellant’s admissions in his earlier police statements to his subsequent denial, the Court observed that it “overlooks the elementary consideration that an admission which is a statement made against interest constitutes evidence whereas a self-serving out of court statement does not”.

12. So far as Mr Muttylall was concerned, the Court said that the prosecution evidence was sufficient without it, that there was no indication that his testimony would have assisted the appellants, and that anyway it was open to them to have called him if they wished.

13. The appeal against conviction in this case was, quite frankly, hopeless and one wonders why it was not disposed of, as so easily it could have been, by a brief ex tempore judgment.

Post-appeal proceedings

14. In his application for leave to appeal to the Privy Council settled shortly after the Supreme Court’s dismissal of his appeal, the appellant merely reaffirmed the selfsame hopeless grounds that had just been rejected. For whatever reason, this application only came before the (differently constituted) Supreme Court for hearing on 13 June 2007. Their Lordships were offered no explanation whatever for this further sixteen month delay in the disposal of the case. By then, as already noted, Boolell had been decided and, armed now with this authority, Mr Ollivry wisely abandoned all thought of appeal against conviction (for which leave could never have been given) and sought instead to assert a breach of the reasonable time guarantee enshrined in section 10 of the Constitution. In oral argument he invoked “the delay which has elapsed between the commission of the offence (January 1997) and the date of the judgment of the Supreme Court (20 January 2006) and in particular the delay between the hearing of the appeal (21 June 2004) and the judgment of the Supreme Court (20 January 2006)”.

15. In their judgment refusing leave to appeal, the Supreme Court said, first, that no question was being raised as to the “interpretation” of the Constitution (such as would have given rise to an appeal to the Judicial Committee as of right under section 81(1)(a) of the Constitution) as opposed merely to the application of the Constitution to the particular facts of the case, and, secondly, that there was no relevant “adjudication or final decision of the Supreme Court against which an appeal would lie to the Judicial Committee”. Their Lordships have already indicated (at para 2 above) how they propose to overcome these apparent difficulties in the appellant’s path.

16. On 24 January 2008 the Board granted special leave to appeal. Once again, however, circumstances forced a delay in the final disposal of this case and the appeal hearing had to be postponed from 30 June 2008 to 16 December 2008, this time because the appellant could no longer afford Mauritian counsel and English counsel had to be found to represent him pro bono. The Board are most grateful to Mr Aidan Casey for undertaking that task.

Was there a breach of section 10 in this case?

17. Boolell itself, drawing as it does on the Board’s decision in Dyer v Watson 2004 1 AC 379, provides a convenient (and for present purposes sufficient) statement of the relevant principles which apply to a constitutional challenge of this character. It is quite unnecessary to rehearse them here. Their Lordships proceed instead to apply them to the facts of this case.

18. If one asks the fundamental question, does the period which elapsed here between the appellant’s arrest in April 1997 and the dismissal of his appeal to the Supreme Court on 20 January 2006 give ground for real concern as to whether this case has been heard and completed within a reasonable time, there can surely be only one answer: yes. Thus it is necessary for the respondent state to explain and justify what appears overall to be an excessive lapse of time. As Boolell makes clear, the Board is concerned particularly with, first, the complexity of the case, secondly, the conduct of the defendant, and thirdly, the manner in which the case has been dealt with by the state’s administrative and judicial authorities. As already stated, this case involved absolutely no complexity; it was about as straightforward as any serious conspiracy can be. As for the conduct of the defendant, whilst it is plain that the appellant was entirely content for these proceedings to take their own leisurely course from beginning to end, there was no question of his engaging in the sort of reprehensible conduct which the Board found had contributed so largely to the even longer lapses of time in Boolell’s case. There, as the Board observed at para 37, “the appellant was bent on dislocating the course of the trial and prolonging the proceedings by every means within his power”.

19. As to the third matter for the Board’s consideration, the way the case has been dealt with by the Mauritian authorities, it is necessary here to consider the various stages of this lengthy criminal process. Their Lordships see no particular reason to criticise the conduct of the case up to the point of the appellant’s conviction and sentence on 31 May 2001. True, the proceedings before the Intermediate Court took a leisurely course but at that stage there was no particular urgency about the case and doubtless there were numerous other calls upon the Court’s time. The subsequent passage of three years until the appeal against conviction came to be heard by the Supreme Court becomes more difficult to justify. Given, however, that two of those three years passed because of successive adjournments of the appeal hearing for the convenience of the appellant’s own counsel, their Lordships would not regard section 10 as having been breached had the matter even at that late stage proceeded satisfactorily. What, however, is really quite impossible to justify is the final nineteen month delay between the actual hearing of the appeal and its ultimate dismissal by the comparatively brief and straightforward judgment eventually given on 20 January 2006. Whatever pressures the Supreme Court may have been under during that time, there can simply be no logical explanation or excuse for this final 19 month period of delay. Their Lordships call this the “final” period of delay, but there remained, of course, the further 17 month delay until 13 June 2007 when finally the Supreme Court refused leave to appeal to the Judicial Committee (the decision the Board are treating as the Supreme Court’s rejection of a constitutional challenge for breach of the reasonable time guarantee under section 10).

20. Overall their Lordships feel driven to conclude that the judicial authorities here cannot sensibly be regarded as having honoured the reasonable time guarantee provided for by section 10 of the Constitution. True, the appellant was wholly complaisant in every successive delay which occurred: never once does he appear to have sought to hasten matters, for example by enquiring when he might finally expect to hear the result of his appeal. He was, of course, on bail at all times since 17 June 1998 and he seems to have been entirely content to postpone the final day of judgment, about which he can hardly have been optimistic. That, however, can provide no answer to the constitutional challenge. If it was no answer in Boolell (where the Board found “the conduct of the defendant was altogether reprehensible and contributed very largely to the lapse of time”), it certainly provides none here. It is to be acknowledged that the delay in Boolell was significantly longer even than in the present case—12 years elapsed between Boolell’s statements to the police under caution and his conviction by the Intermediate Court (his subsequent appeal to the Supreme Court being dismissed just 14 months later). It was, indeed, that quite extraordinary delay which impelled the finding there of a constitutional breach notwithstanding earlier authority that the defendant cannot ordinarily complain of delay of which he himself was the author. Again, however, the yet longer delay in Boolell’s case obviously cannot serve to justify the passage of nearly nine years between this appellant’s arrest and the dismissal of his appeal against conviction.

Redress

21. What, if any, remedy should be afforded to the appellant for this constitutional breach? There can be no question here of setting aside the conviction and rightly, indeed, no such result is contended for. Rather the appellant asks that a fine be substituted for his custodial sentence, the course taken in Boolell itself. The Board in Boolell (at para 39) thought it “[un]acceptable that the prison sentence imposed by the Intermediate Court should be put into operation some 15 years after the commission of the offence unless the public interest affirmatively required a custodial sentence, even at this stage”. Holding that was not such a case, the Board set aside the sentence of six months’ imprisonment and substituted for it a fine of Rs10,000.

22. The present case, however, involves altogether greater criminality than Boolell, a member of the Mauritian Bar, was guilty of: essentially the passing of a worthless cheque. As was observed by Lord Lane CJ in R v Howard (1985) 7 Crim App R (S) 320:

“The issue of counterfeit notes undermines the whole economy of the country and is likely to result in great loss being sustained by innocent people who find themselves in possession of these notes only to discover that they are worthless.”

Such sentences as were passed upon the four conspirators in the present case are routinely passed in equivalent cases in the UK. The appellant, indeed, having contested his guilt, may consider himself fortunate not to have been subject to a longer sentence than the four-year term imposed.

23. The Board recognises that a total of 12 years has now passed since the appellant’s offence (compared to the 15 years referred to in Boolell). Their Lordships, however, would certainly not think it right to set aside the appellant’s four-year sentence, not least because of the plain injustice that such a course would inevitably represent in the eyes of the appellant’s co-conspirators (two of whom pleaded guilty and have long since served their six-year terms in full, and one of whom, Khodabaccus, rightly accepted the dismissal of his appeal against conviction in January 2006 and, presumably, has since served his three-year term). Frankly, the very fact that the Board is prepared to entertain this appeal and find a breach of the reasonable time guarantee could well be thought redress enough: anything beyond this from the appellant’s standpoint may be regarded as essentially fortuitous. All that said, however, their Lordships on balance think it right to mark the undoubted constitutional breach in this case by making a modest reduction in the sentence to be served. In the result they quash the four-year term and substitute for it a term of three and a half years’ penal servitude, such sentence now to be served without further delay. To this extent and to this extent only the appeal is allowed. There will be no order for costs.

24. In the light of the Board’s recent opinion in Callachand v The State [2008] UKPC 49, Mr Casey additionally sought to pray in aid the length of time (thirteen and a half months) spent by the appellant in custody before his trial. As to this, however, the Board see no reason why the appellant’s position should be any different from, or better than, that of the presumably countless other serving prisoners in Mauritius who have also previously spent time in custody. Whether, consequent on Callachand, their position is to change is now entirely a matter for the Supreme Court of Mauritius. The Board on this appeal has nothing further to say on the point.

Guy Lebon v. Aqua Salt Limited

Privy Council Appeal No 26 of 2007

(1) GUY LEBON

(2) CLAUDE BONNENFANT

Appellants

v.

AQUA SALT CO LIMITED

Respondent

FROM

THE SUPREME COURT OF

MAURITIUS

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JUDGMENT OF THE LORDS OF THE JUDICIAL

COMMITTEE OF THE PRIVY COUNCIL

Delivered the 4^th February 2009

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Present at the hearing:-

Lord Hoffmann

Lord Rodger of Earlsferry

Lord Walker of Gestingthorpe

Lord Mance

Sir Jonathan Parker

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[Delivered by Lord Hoffmann]

1. This appeal arises out of an action for possession of a dwelling house and garage standing on 15 perches of land at Les Salines, Roches Noires (“the house”). The transactions which gave rise to the dispute took place between 1980 and 1983 and the dispute itself goes back to 1984. The trial took place over a number of days between July 2000 and March 2002 and judgment was delivered on 6 June 2002, ordering the defendants to deliver up possession. An appeal to the Supreme Court was dismissed on 27 April 2006. The defendant appeals to the Privy Council.

2. Some of the facts are obscure, partly because of the deaths of two important participants in the relevant transactions and the fading of the memories of others and partly because some questions were not explored at the trial. What seems clear enough is that in November 1981 Mr Gujadhur Jingree agreed to sell the house to the first Defendant Mr Guy Lebon, who purchased as agent for his step-brother, the second defendant Mr Claude Bonnenfant. Mr Jingree’s testimony on the point was unavailable because he died some years before the trial, but Mr Lebon gave unchallenged evidence about the agreement and produced a document dated 28 November 1981, signed by Mr Jingree, acknowledging the receipt from “Guy Lebon de la part de Mr Claude Bonnefant” of Rs 55,000, “représentant la vente d’un terrain de 15 perches avec un maison en ciment…la Saline à Roches Noires. Le contrat sera fait a la fin de decembre 1983.”

3. Equally clear is that Mr Jingree did not have title to the land. However, the land on which the house stood was part of an old salt works covering 9 arpents and 35 perches (“the salt works”), owned at the time by a company called Black Rocks Ltd. Mr Lebon said at the trial that Mr Jingree had shown him a bordereau which he said evidenced an agreement by which he had agreed to buy the salt works. A document was produced purporting to be a sale or agreement for sale dated 27 November 1980 by which Black Rocks agreed to sell the salt works to Mr Jingree and his wife for Rs 250,000, of which Rs 50,000 had been paid. There was much dispute over the authenticity of this document (as to which the judge in the end made no finding) but there seems to be no doubt on two points; first, that, as the judge found, it did not pass title to Mr Jingree and secondly, that there must have been some contractual arrangement between Black Rocks and Mr Jingree, which has been variously characterised as an option to purchase or an uncompleted agreement. The existence of such an arrangement is supported by Mr Lebon’s unchallenged evidence that he lent Mr Jingree the Rs 50,000 to pay the first instalment of the price, raising the money by a loan from his bank guaranteed by Mr Jingree. The evidence is not altogether clear but it seems that Mr Jingree must have repaid the loan out of the proceeds of sale of the house.

4. Presumably the lengthy period which Mr Jingree’s agreement with Black Rocks allowed for completion was to enable Mr Jingree to raise the rest of the money to buy the salt works. He did so by finding three other investors: Mr Lim, Mr Toon and Mr Hart de Keating, who agreed to participate with him in the formation of a company to acquire the land. It was called Aqua Salt Co. Ltd (“Aqua”) and was incorporated on 15 December 1983 with a memorandum of association declaring that its main object was to produce salt. The share capital of Rs 500,000 was divided into 5,000 shares of Rs 100 each: one Promoter’s Share A (allotted to Mr Lim), three Promoters’ Shares B (allotted to Mr Toon, Mr Jingree and Mr Hart de Keating) and 4996 Ordinary Shares, allotted as to 1599 each to Mr Toon and Mr Hart de Keating and as to 899 each to Mr Lim and Mr Jingree. The Promoter’s Share A gave Mr Lim the right to be managing director and the Promoters’ Shares B gave each of the other three the right to a seat on the Board.

5. On 16 December 1983 Mr and Mrs Jingree executed a document by which they formally renounced their interest in the salt works, declaring that they would have no claim against Black Rocks or against Aqua, which was “due to purchase [the property] very shortly.” That suggests the previous existence of a contract of purchase or at any rate a right to buy of which the Jingrees were the beneficiaries. Completion of the sale by Black Rock to Aqua for Rs 250,000 in fact took place on 10 February 1984 by the execution of a notarised deed, which was subsequently registered.

6. It is not altogether clear what the other shareholders knew of Mr Jingree’s dealings with Mr Lebon or even the fact that he and his family were in occupation of the house. It appears from the pleadings in a case brought in the Mapou Magistrates’ Court against Mr Lim, the managing director of Aqua, that he was quick off the mark in taking possession of the land comprised in the sale of the salt works. Mr Lebon alleged that on 15 December 1983, two days after the formation of Aqua, Mr Lim put building materials on the right of way by which the occupants of the house obtained access to the main road. On 4 February 1984 he entered upon the land and threatened to demolish the garage which Mr Lebon was building. On 6 February 1984 Mr Lebon commenced his proceedings against Mr Lim personally, asking for an injunction to require him to remove the obstruction from the right of way and to restrain him from interfering with Mr Lebon’s quiet possession.

7. Mr Lim also died before the commencement of the trial, so his account of these events is lacking. It is suggested that Mr Lim must have learned of the sale by Mr Jingree to Mr Lebon from the process served upon him a few days before the execution of the deed of sale in favour of Aqua. But the plaint says nothing about such a sale. It appears to have been carefully drafted to assert no more than a possessory title.

8. It appears that Aqua retaliated by applying in the Supreme Court for a writ of habere facias possessionem in respect of the house, relying upon the title which it had acquired from Black Rocks. The affidavits sworn in these proceedings were produced at the trial but do not appear to have been made part of the record. Their Lordships are therefore obliged to piece together their contents as best they can from fragments which were read in court and went onto the transcript. Mr Lim swore the founding affidavit dated 20 March 1984; there was an affidavit in answer from Mr Lebon dated 23 May 1984 and a reply from Mr Lim dated 7 June 1984. Mr Lebon’s evidence appears to have been that Mr Jingree had purchased the salt works from Black Rocks, including the 15 perches on which the house was built, and then agreed to sell the 15 perches to Mr Bonnenfant on 28 November 1981. Mr Lim’s reply was to accept that Mr Jingree had agreed to buy the salt works but to aver that “the sale…was made under certain conditions viz (a) the sale was made under conditions suspensive (b) the authentic deed of purchase to be drawn up on payment.”

9. Rather oddly, Mr Lim’s affidavit in reply appears to have denied that the house had formed part of the salt works. It appears up to that point to have been assumed by everyone that it did; Mr Lebon had so asserted in his affidavit, attempting to establish a chain of title from Black Rocks through Mr Jingree. Quite why Mr Lim should have suggested that Mr Jingree had sold Mr Lebon some other piece of land with a concrete building must remain a mystery. Perhaps it reflects a garbled explanation he was given by Mr Jingree, who may have had some difficulty in explaining to the other investors for the first time that he had sold off the house. But there appears to their Lordships to be no doubt that the house and its 15 perches formed part of the salt works owned by Black Rock and sold to Aqua.

10. The judgment of Espitalier-Noel J in the habere facias possessionem proceedings, delivered on the 2 November 1984, is instructive because it is based on affidavits sworn at a time when the relevant events were fairly recent and all the participants were alive. He said:

“The evidence as it stands sufficiently reveals the following: In 1981, Gujadhur Jingree agreed to sell the fifteen perches together with the concrete building thereon existing to Claude Bonnenfant who paid the agreed purchase price of Rs 55,000 and occupied the property, either by himself or through the respondent, his proxy.

Gujadhur Jingree had himself previously purchased from Black Rocks Co Ltd the property of 9A35 perches…subject to the sale being perfected by an authentic deed of sale being drawn up on payment in full by Jingree of the purchase price.

This being the case, it is common ground that Bonnenfant could only acquire a valid title to the property … from Jingree on the latter perfecting his own purchase from Black Rocks Co Ltd.

This Jingree did not do. He renounced his purchase from Black Rocks Co Ltd on the 16^th December 1983, three days after the applicant company (Aqua Salt Co Ltd) was formed of which he (Jingree) was a promoter, one of three (or four) shareholders, and a director and it was the company which, on the 10^th February 1984, by notarial deed, purchased the 9A 35 from Black Rocks Co Ltd.

The defence raised by the respondent to the effect that the applicant company was well aware of Jingree’s commitment towards Bonnenfant and would have acted in fraudulent collusion with Jingree in purporting to purchase the property in its own name, seriously, I find, questions the genuineness itself of the applicant company’s title – a matter requiring canvassing in court.

The present application is accordingly refused with costs.”

11. Their Lordships consider that this judgment identifies the issue with economy and precision. Section 5 of the Transcription and Mortgage Act 1863 provides that ―

“…no right in immoveable property under a deed or judgment shall be maintained against a third party whose rights are secured by law over the immoveable property to which the deed or judgment applies, unless the deed or judgment has been transcribed.”

12. Even if they were deeds (which they do not appear to have been), neither the agreement between Black Rocks and Mr Jingree nor the agreement between Mr Jingree and Lebon were transcribed. In terms of the statute, therefore, they do not enable Mr Lebon to maintain any right against Aqua.

13. In English law, that may have been the end of the matter (see Midland Bank Trust Co Ltd v Green [1981] AC 513) but the law of Mauritius, like most systems based on civil law, provides an exception for cases in which the purchaser is in bad faith. The position is clearly explained by Caunhye J in the recent case of Soobramanien v Jogoo (15 February 2007). After setting out the effect of section 5 of the 1863 Act, he said:

“But that is not the end of the matter…Where the beneficiary of a promesse de vente has failed to transcribe the deed, he can still safeguard his rights if he can prove that the second purchaser knew at the time of his purchase that the land was already the subject matter of a sale agreement to another person. The following excerpt from Encyclopédie Dalloz Droit Civil [Vol VIII V^o Promesse de Vente] clearly explains the position:

171…Si le vendeur aliène l’immeuble au mepris de la promesse non publiée, et si le tiers acquéreur publie son acquisition, le bénéficiare du premier ‘compromis de vente’ se trouvera en principe évincé…

172 Cette dernière solution reçoit, cependant, exception au cas où le bénéficiare parvient à prouver que le deuxième acquéreur connaissait, au moment où il a acheté, l’existence de la vente initiale; il a été jugé en ce sens que l’acquisition d’un immeuble, en connaissance de sa vente antérieure, est constitutive d’une faute ne permettant pas à l’acheteur d’invoquer les règles de la publicité foncière.”

14. Hence the issue identified by Espitalier-Noel J, namely, whether, at the time it bought the salt works, Aqua had knowledge of the previous agreement to sell the house to Mr Lebon. The judge appears to have taken it for granted that Mr Lebon was the beneficiary of a promesse de vente and that seems to their Lordships correct. The case of Soobramanien, to which reference has already been made, shows that an agreement to sell is for these purposes a promesse de vente even though it provides (as in the agreement between Black Rocks and Mr Jingaree) that payment will be by instalments and that an authentic deed of sale will be executed only after the full price has been paid. The agreement between Mr Jingaree and Mr Lebon was undoubtedly a promesse de vente which obliged Mr Jingaree to get in the title from Black Rocks and transfer ownership to Mr Lebon or his principal Mr Bonnenfant. Their Lordships consider that Mr Lebon was thereby entitled to exercise whatever rights Mr Jingaree had against Black Rocks in respect of the 15 perches and to be treated as bénéficiare of the promesse de vente in respect of that land.

15. At the eventual trial of the action before Lam Shang Leen J, the issues on the pleadings were, first, whether Mr Lebon had acquired title to the land and secondly, whether, as alleged in the amended defence and counterclaim, Jingaree, as a director of Aqua, had “mala fide and de connivance” with Aqua renounced his rights to allow Aqua to purchase “irrespective of the defendant’s rights to the 15 perches…” The judge had no difficulty in finding that Mr Lebon had not acquired title. The document evidencing the sale by Black Rocks to Jingaree was probably not a deed and in any event had not been transcribed. The same was true of the sale by Jingaree to Mr Lebon. In this respect, the judge came to the same conclusion after a lengthy trial as Espitalier-Noel J had done on affidavit evidence eight years earlier.

16. The more difficult question was whether Aqua had known of the sale to Mr Lebon. For this purpose, it was necessary to decide, first, whose knowledge was attributable to Aqua and secondly, whether as a matter of fact, that person or those persons knew of the sale.

17. The judge found as a fact that no member of the Board, other than Mr Jingree himself, had known of the sale:

“I further find that the defence has failed to prove on a balance of probability that there was a conspiracy between Mr Gajadhur Jingree and the plaintiff company to deprive [Mr Bonnenfant] of 15 perches of the land belonging to Black Rocks Ltd. It is insufficient to say that Mr Gajadhur Jingree was a shareholder and founder member of plaintiff company to infer that the plaintiff company was therefore a party to a conspiracy to dispossess [Mr Bonnenfant] of land for which he had effected payment to Mr Gajadhur Jingree. Mr Hart de Keating was adamant that the plaintiff company through its representatives had in good faith purchased 9A35 perches of land from Black Rocks Ltd which was duly represented and I do not doubt his words.”

18. The Supreme Court affirmed these findings. Mr Birnbaum QC, who appeared for the appellants, invited the Board to hold that these concurrent findings of fact were wrong. Mr Hart de Keating should not have been believed. Their Lordships think that this is a hopeless submission. There is nothing in the transcript which appears to their Lordships to cast the slightest doubt on Mr Hart de Keating’s veracity. On the contrary, it supports the judge’s opinion that he was a reliable witness. Mr Birnbaum also said that the judge should have found that Mr Lim knew about the previous sale. Again, there is nothing in the evidence which would support such a finding.

19. The issue is therefore a very narrow one. The one person who undoubtedly had knowledge of the earlier sale was Jingree. Is his knowledge attributable to Acqa? Was Lam Shang Leen J right in saying that it was “insufficient to say that Mr Gajadhur Jingree was a shareholder and founder member of plaintiff company”? If that is right, then the appeal must fail. On the other hand, if Mr Jingree’s knowledge counted for this purpose as the knowledge of Aqua, then Aqua did not acquire the land in good faith and Mr Lebon’s promesse de vente is enforceable against it.

20. Their Lordships feel some difficulty about dealing with this question because it does not appear to have been raised in quite this form in any of the courts below, although the way in which Lam Shang Leen J formulated his reasons suggests that it had been submitted on behalf of Mr Lebon that it would be sufficient to say that Mr Jingree was a shareholder and founder member of Aqua. But the point was not argued before the Supreme Court or mentioned in the appellants’ printed case before the Board. In fact their Lordships regrettably feel bound to record that neither they nor the Supreme Court received from the respective counsel representing the appellant the assistance they were entitled to expect. In the appellant’s opening submissions to the Board, no reference was made to the Mauritian law protecting the beneficiary of a promesse de vente against a subsequent purchaser with knowledge of his contract. The authority to which their Lordships have referred was produced by counsel for the respondent. And at no stage has there been any discussion of what, in the case of a corporate purchaser, would count as the knowledge of the company.

21. After careful consideration, however, their Lordships have decided that they should decide the point. It is a point of law arising out of undisputed (or indisputable) evidence. There would be no prejudice to the respondent which cannot be compensated by an appropriate award of costs. On the other hand, to refuse to consider the matter could be an injustice to the appellants.

22. A corporate body can have knowledge only by the attribution of the knowledge of a natural person. The principles upon which one decides whose knowledge should count as the knowledge of a corporate body were discussed by the Privy Council in Meridian Funds Management Asia Ltd v Securities Commission [1995] 2 AC 500. The Board said at p 507 that if a given rule of substantive law (such as the rule that a purchaser of land who knows of a prior sale will not take free of the rights of the first purchaser) applies to a company, the question of whose knowledge counts as that of the company will depend upon the interpretation and purpose of the substantive rule:

“given that [the substantive rule] was intended to apply to a company, how was it intended to apply? Whose act (or knowledge, or state of mind) was for this purpose intended to count as the act etc. of the company? One finds the answer to this question by applying the usual canons of interpretation, taking into account the language of the rule (if it is a statute) and its content and policy… [T]he rule of attribution is a matter of interpretation or construction of the relevant substantive rule...”

23. Thus, in the Meridian case itself, the substantive rule required a company to notify the Securities Commission when it knew that it was the holder of more than a certain number of shares. The Board decided that for the purposes of this rule, the persons whose knowledge should be attributed to the company were those who had authority to acquire the shares. Otherwise the policy of the rule would be defeated (p 511):

“Companies would be able to allow employees to acquire interests on their behalf which made them substantial security holders but would not have to report them until the board or someone else in senior management got to know about it. This would put a premium on the board paying as little attention as possible to what its investment managers were doing.”

24. An earlier example of the application of these principles is Al Ajou v Dollar Land Holdings Ltd [1994] 2 All ER 685, in which the knowledge of the chairman that money received by the company had been obtained by fraud was attributed to the company. More recently, in Jafari-Fini v Skillglass Ltd [2007] EWCA Civ 261, the question was whether information that a bribe had been paid to one of the parties had “come to the attention” of a company for the purposes of a provision in a financing agreement which required it to make full disclosure of all such information material to the agreement. It had in fact come to the attention of only one of the directors. In the Court of Appeal, Moore-Bick LJ said (at paragraph 98):

“The question in the present case is whether information which comes to the attention of one director, but which he has not shared with the rest of the board, is to be treated as information in the possession of the company. .. In general…I think that information relevant to the company's affairs that comes into the possession of one director, however that may occur, can properly be regarded as information in the possession of the company itself. In my view that presumption informs the present contract and points to the conclusion that information in the possession of [the director] relating to the bribe is to be regarded as information in the possession of [the company] itself.”

25. The rule that a second purchaser with actual notice of the first purchase cannot rely upon the requirements of public notice by transcription or registration is based, as the Encyclopédie Dalloz puts it, upon the proposition that reliance on those requirements would be a “faute” on the part of the first purchaser. It would be inequitable for him to rely on them, because he already had all the information which transcription would have given him. It is therefore necessary to ask which rule of attribution would best serve the purpose of this rule. If one of the directors knows of the previous sale at the time of the purchase but omits to tell the other directors and allows the sale to go ahead, would it be equitable for the company to be able to rely on the lack of transcription to override the rights of the earlier purchaser?

26. Their Lordships consider on the facts of this case, the substantive rule requires the knowledge of Mr Jingree to be attributed to Aqua. There is no reason why the general principle formulated by Moore-Bick LJ should not apply. The formation of the company was the means by which Mr Jingree exploited the agreement he had made with Black Rocks three years earlier. If he had been able to raise the money himself and obtain title by authentic deed, he would undoubtedly have been bound by his agreement with Mr Lebon. In the event, the purchase was made by the company. But Mr Jingree was a promoter, director and substantial shareholder. It is true that he did not represent the company before the notary, but that was a mere formality. What matters is that the company purchased by virtue of the arrangements he had made with Black Rocks and that he was a director at the time of the purchase. It may have been a breach of his duty to the company and the other investors not to disclose that he had sold the house, but that should not give the company better rights against Mr Lebon than he alone would have had. In those circumstances, their Lordships consider that Mr Jingree’s knowledge should be attributed to Acqa, which was therefore bound by the sale to Mr Lebon.

27. Their Lordships will therefore allow the appeal and declare that Mr Bonnenfant is entitled as against Aqua to the execution of an authentic deed transferring ownership of the house and garage on the 15 perches sold to him pursuant to the 1981 contract with Mr Lebon. The parties have 14 days in which to make submissions in writing on costs.