[1934] 1 MLJ 96

TAN HEE JUAN BY HIS NEXT FRIEND TAN SEE BOK v TEH
BOON KEAT; LAI SOON
[ORIGINAL CIVIL JURISDICTION] NEGRI SEMBILAN
HEREFORD, J
CIVIL SUIT NO 5 OF 1933
17 November 1933
Land Code 1926, s 42 Transfer executed by a minor Order avoiding the
transfer Discretion of Court to order refund of purchase money Specific Relief
Enactment, ss 38 and 41
The plaintiff, an infant, executed transfers of lands in favour of the defendants. The
transfers were witnessed and subsequently registered.
The plaintiff by his next friend applied to the Court for an order setting aside the
transfers and for incidental relief.
The Court made an order declaring the transfers void, and refused to order the
refund of the purchase price paid by the defendants.
Held, that the discretion possessed by the Court under the Specific Relief
Enactment will, in the case of contracts which are void, only be exercised where
the parties stand in such a fiduciary relationship to one another that it would be
unfair to the defendant to allow the plaintiff to retain both the advantage of the
purchase money standing as part of his Estate and also to recover the property.

Dutt for Plaintiff.

Hastings for Defendants.
HEREFORD, J
In this case it appears that two transfers were executed by the infant Plaintiff of
two pieces of land in Mentakab to the two Defendants respectively, and the action
actually brought by the Plaintiff's next friend appointed by an order of Court is to
have these two transfers set aside and other relief incidental thereto, on the
ground that at the time the transfers were executed the Plaintiff herein was a
minor. There is no doubt about that fact: it is quite clear now, and I do not think it
is seriously disputed, that at the time when the transfers were executed the
Plaintiff, Tan Hee Juan, was in fact an infant and, therefore, unable to contract.
The Privy Council have held that the effect of sections 10 and 11 of the Contract
Act of India is that an infant cannot make a contract within the meaning of the Act,
and that a contract made by an infant is not only voidable but void. Mohori Bibee v
Dharmodas Ghose 30 Calcutta 539. That decision of the Privy Council is binding on
this Court, and therefore there can be no doubt whatever that those transfers are
void. That being so, as the registration of these proprietors has been obtained by a
void instrument, the effect of section 42(iii) of the Land Code is that the
registration is void, and I have no option or alternative that I know of or can
discover but to declare that registration void. That has the effect of restoring the
property to the minor, and the order which I will have to make will be to that
effect. To my mind there is no way of avoiding that decision, although I realise
there may be circumstances in this case which may make it a harsh one because
the Defendants say they had no reason to suppose that the vendor was in fact an
infant. Some underhand work in connection with these transfers probably took
place, because attached to the transfers there is a certificate by a Solicitor to say
that the vendor was in fact of full age. How he came to sign that certificate there is

no evidence to shew, but it is difficult to avoid the conclusion that some deception
was practised. The Defendants do not claim that there was any deception practised
on them: they appear to have accepted the transfers without troubling to enquire
who the vendor was and did not even take the trouble to see him. They do not
suggest that an adult was put off upon them as the vendor, and the evidence of
the infant himself is that he signed these transfers actually in the Solicitor's office
while the evidence of the Defendants also shews that they attended the Solicitor's
office where they signed the transfers as transferee. It is possible that they and
the Plaintiff attended at different times, but I think that the purchaser of these
lands who purchased without enquiring as to who the vendor was or taking any
steps to see him, must take the consequences if it turns out subsequently that the
vendor was an infant and the contract void. However that might be, to my mind, it
does not relieve me of the necessity of declaring these two transfers void.
The real question that I have to decide in this case is whether I ought to order that
the purchase prices of these lands which were admittedly paid by the Defendants
should be refunded to them as a condition precedent to the cancellation of these
two transfers. The first case quoted
1934 1 MLJ 96 at 97
is the case to which I have referred. At page 549 the following passage occurs:
"Another enactment relied upon as a reason why the mortgage money should be
returned, is section 41 of the Specific Relief Act (1 of 1877), which is as follows:
Section 41. On adjudging the cancellation of an instrument, the Court may require the
party to whom such relief is granted to make any compensation to the other which
justice may require.'
Section 38 provides in similar terms for a case of rescission of a contract. These
sections no doubt do give a discretion to the Court, but the Court of First Instance
and subsequently the Appellate Court, in the exercise of such discretion, came to the
conclusion that under the circumstances of this case justice did not require them to
order the return by the respondent of money advanced to him with full knowledge of
his infancy, and their Lordships see no reason for interfering with the discretion so
exercised."

Now, that part of the judgment of the Privy Council in this case has been held in
the textbooks to be an authority for the Court having a discretion in proper cases
to order the refund of the purchase money. I find myself doubtful whether the case
really goes so far, because the judgment continues as follows:
"It was also contended that one who seeks equity must do equity. But this is the last
point over again and does not require further notice, except by referring to a recent
decision of the Court of Appeal in Thurstan v. Nottingham Permanent Benefit Building
Society since affirmed by the House of Lords. In that case a female infant obtained
from the Society of which she was a member part of the purchase-money of some
property she purchased; and the Society also agreed to make her advances to
complete certain buildings thereon. They made the advances and took from her a
mortgage for the amount. On attaining 21 she brought the action to have the
mortgage declared void under the Infants Relief Act. The Court held that, as regards
the purchase-money paid to the vendor, the Society was entitled to stand in his place
and had a lien upon the property; but that the mortgage must be declared void and
that the Society was not entitled to any repayment of the advances.

Dealing with this part of their claim Lord Justice Romer says at page 13: 'The short
answer is that a Court of Equity cannot say that it is equitable to compel a person to
pay any moneys in respect of a transaction which, as against that person, the
Legislature has declared to be void.' So here."

Therefore I think it is right to say that if the Privy Council's decision is that there is
a discretion, in a case of this sort, to order the refund of the purchase money, it is
only where there are very unusual circumstances that that discretion can be
exercised.
A good many cases have been quoted to me during the arguments in this case, but
I think I am correct in saying that there is only one case quoted in which the Court
has exercised the discretion, which it is alleged to have under section 41 of the
Specific Relief Enactment, or of the Specific Relief Act of India. That case is the
case ofDattaram v Vinayak 28 Bombay 181 where money which had been paid
upon a mortgage was ordered to be refunded by the Court of Appeal. In that case
the following words occur on page 192 of the report:
"The facts in the case of Mohori Bibee v. Dharmodas Ghose show that the restitution
there claimed but disallowed had no other basis than that of a simple money demand
the person who had lent money to the minor on a mortgage knew the debtor was a
minor, there was no fiduciary or other relation between the two to give rise to an
equity in favour of the creditor, and the minor had dissipated the money in
extravagance. In the present case the restitution claimed is not a mere money
demand; the parties (defendants 1 and 3) stand in a state of accountability to each
other; and the amount claimed by defendant 1 stands as part of the mortgage
account which defendant 3 wishes to reopen."

That, so far as I know, is the only case to which I have been referred in which the
discretion under section 41 of the Specific Relief Enactment or Act has been
exercised, and it seems to me that, before such discretion is exercised, there must
be some fiduciary relation between the parties. Now, in this case, there is no such
relation at all between the parties. They never saw each other; neither did the two
defendants see the vendor, nor did the infant vendor see the persons to whom the
lands were to be sold. Furthermore, I think that the principle at the back of this
section giving the Court a discretion to order refund of the purchase money or the
mortgage money, as the case may be, is this: it would be unfair to the defendants
that if the infant has had the advantage of the purchase money or the proceeds of
the mortgage he should have the advantage of being the owner of the property as
well without being called on to return that money or those proceeds. In this case,
the infant Plaintiff's estate "qua" such has not received any advantage at all. The
1934 1 MLJ 96 at 98
mother says she received the $17,000/- and spent $15,000/- on the estate: that is
not the infant's estate "qua" such. The balance of the money, she says, was used
in maintaining this family of which the infant plaintiff was a member. There again,
although he has received the benefit of a portion of this money it cannot be said, it
seems to me, that his estate had the advantage of all or any part of the purchase
money and that therefore I can order its refund.
A number of English cases were cited to me in some of which restitution by the
infant has been ordered, but in the cases of Valentini v Canali (1889) 24 QBD 166
andSteinberg v Scala Ltd (1923) 2 ChD 452 the contracts were contracts which in
the view of the Common Law were not void but only voidable, and the principle on
which restitution is ordered is different in such cases as compared with cases
where the contract is absolutely void.

This appears to me to be well brought out in the case of Thurstan v Nottingham

Permanent Benefit Building Society (1902) 1 ChD 1. In that case the infant had
borrowed money from the Defendant Company

(a)
to complete purchase of the property,

(b)
to effect certain improvements to the property,

and had executed a mortgage in favour of the Defendant Company for the total
sum due. The trial Judge held that that transaction was one transaction and was
therefore voidable, but the House of Lords confirming the decision of the Court of
Appeal held that in fact there were two transactions and that while (a) was a
voidable transaction (b) by virtue of the provisions of the Infants Relief Act was
absolutely void. As a result the Defendant Company was given relief in regard to
(a) but not in regard to (b), and it is in the judgment of Romer, L.J., in relation to
the second part of this case that the following words occur:
"A court of equity cannot say that it is equitable to compel a person to pay any
moneys in respect of a transaction which, as against that person, the legislature has
declared to be void."

Although the decision which I have come to may be a harsh one to the
Defendants, it is my duty to protect the interests of the infant while he is an infant,
and I have to take such steps as the law provides to protect the property even
against his will: the infant now says that he does not want the property protected.
What the infant thinks or says about the property, while he is still an infant, is, I
am afraid, a consideration which cannot move me.
It has been suggested that Tan See Bok was not the proper person to bring this
suit because he is not the Plaintiff's lawful guardian. On that point I merely say
that Tan See Bok was appointed the next friend of the plaintiff in this case by an
order of Court; that order of Court clearly stands until it is set aside. If the infant
or any of the infant's people think that it was an improper one or that somebody
should be appointed in his place, an application should have been made to the
Court to that effect. The mother was originally a Defendant in this suit but action
was successfully taken to have her name struck out. If there is any justification for
saying that Tan See Bok is not the proper person to bring this suit, there has been
ample opportunity, for action to be taken to have that order set aside, and it is a
matter with which I cannot now deal.
Under these circumstances, it seems to me that the only order I can make is an
order that the transactions are void. I therefore declare that the two transfers
registered 37 and 38, volume 39, in the Registry of Titles, Kuala Lipis, are void and
that the registrations of the two Defendants as proprietors by virtue of these deeds
are also void. The Defendants to pay the costs.
Judgment accordingly.