NAVARATNE

NAVARATNE

VS.

KAMALAWATHIE

SUPREME COURT
DE ABREW, J.
DEHIDENIYA, J.
AMARASEKARA, J.
SC/APPEAL/68/2015
SC/SPL/LA/240/2014
CA/APPEAL/335/99/F
DC MAHO 3664/L
JULY 5, 2020

Debt Conciliation Ordinance, No. 39 of 1941, sections 32(2) and 39(2)-Effect of the certificate issued under section 32(2)

Held :

1. What can be proved by tendering a certificate issued in terms of section 32(2) of the Debt Conciliation Ordinance is that the application before the Debt Conciliation Board was dismissed and the Board was of the view that the suggested settlement was fair and the creditor ought reasonably to have accepted it. Such opinion of the Board cannot prove a cause of action before a court of law nor is the court bound by such opinion.

2. The provisions in relation to considering mortgages to be conditional transfers are only for the purposes of the Debt Conciliation Ordinance, namely to effect the settlement of loans.

3. Section 39(2) of the Debt Conciliation Ordinance only gives the court discretion to grant relief as provided by that section in a suitable case notwithstanding that the title to the property is vested in the creditor when the certificate is issued with regard to a conditional transfer of immovable property. However, it has not done away with proof of a cause of action.

Cases referred to :

1. Manam Maggie Silva v. Manikkuge Sai Nona 78 NLR 313

2. Lowe v. Fernando 16 NLR 398

3. Jackson v. Spittel 1880 LR 5 CA 542

4. Seylan Bank Ltd v. Piyasena and others [2005] 2 Sri LR 132

APPEAL from the Judgment of the Court of Appeal.

Dr. Sunii Coorey with Nilanga Perera for the Plaintiff-Appellant-Appellant.

Upendra Walgampaya for the Defendant-Respondent-Respondent.

cur. adv. vult.

June 2, 2021

AMARASEKARA, J.

The Plaintiff-Appellant-Appellant (hereinafter sometimes referred to as the Plaintiff or the Appellant) instituted an action against the Defendant-Respondent-Respondent (hereinafter sometimes referred to as the Respondent or the Defendant) in the District Court of Maha praying inter alia for a judgment:

Directing the defendant to retransfer the property described in the schedule to the plaint to the plaintiff by executing a Deed of Conveyance and,
 

In the event the defendant fails to do so, for such transfer to be effected by executing a Deed of Transfer by the Registrar of the District Court of Maha, and,
 

To evict the defendant and everyone under her and to give the vacant possession of the land to the plaintiff,
 

For a sum of Rs.75,000 for the damages already caused and Rs.1000 per month as damages for unlawful possession.

The plaintiff by her plaint dated 23.01.1993 inter alia stated that :

The plaintiff's signature was also obtained on some other documents at the time of signing the said Deeds.
 

Although the Deed No. 560 had been executed as a Deed of Transfer, it was always considered by the plaintiff as a mortgage bond for the repayment of the loan obtained from the defendant. The consideration of Rs. 100,000 stated in the said Deed is the balance amount of the loan obtained from the defendant and the interest that had to be paid.
 

Although the plaintiff had endeavored to repay the balance of the said loan together with a reasonable interest thereon to the defendant, the defendant failed to accept the same. Thus, the plaintiff made an application to the Debt Conciliation Board (hereinafter sometimes referred to as the board) which was inquired into by the said board.

Although the plaintiff suggested a settlement before the said board, the defendant refused to come into the said settlement. Having considered the said settlement as a fair offer, on 16.01.1991, the said board issued a certificate under section 32(2) of the Debt Conciliation Ordinance (hereinafter sometimes referred to as the Ordinance).
 

Although the defendant made an application to review against the said decision of the board, the said a

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