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IN THE SUPREME COURT OF BELIZE, A.D. 2010

CLAIM NO. 351 OF 2010

(BETWEEN ( (FRANCISCO QUIROZ CLAIMANTS (NEVIA QUIROZ ( (AND ( (OLIVIA GARICA DEFENDANT

Before: Hon Justice Minnet Hafiz

Ms. L. Lochan of M.H. Chebat & Co. for Claimants Dr. Elson Kaseke for Defendant

J U D G M E N T

Introduction

The first Claimant, Francisco Quiroz is the grandson of the late Carlota

Quiroz who by Power of Attorney appointed Francisco to manage all

her land and buildings. The late Carlota was the owner of Parcel 731,

Block 23 San Ignacio North (“the San Ignacio property”), which is the

bone of contention before the court. The second named Claimant, Nevia

Quiroz is the daughter­in­law of the late Carlota and the mother of

Francisco. The late Carlota lived at the San Ignacio Property along with

Francisco and Nevia who took care of care of her until her death. The

Defendant, Olivia Garcia is the adopted child (though not legally) of the

late Carlota.

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2. Francisco and Nevia are claiming that they bought the San Ignacio

property from the late Carlota and now holds a Deed of Conveyance

dated 16 th August, 2006. Olivia, the Defendant who filed a Counter­claim

is also claiming that she bought the property from Carlota and she now

holds a Certificate of Title dated 30 th December, 2009. Both parties are

claiming ownership to the property and that there was fraud committed by

the other. The central issue for the court is the ownership of the San

Ignacio Property.

3. Statement of Case for the Claimant

1) The Claimants say that by Power of Attorney dated 25 th day of February,

2006, Carlota appointed Francisco to, inter alia, manage all her land and

buildings and in particular all that lot, piece of land situated in Cayo and

generally to take possession of and sell all her properties. At paragraph 6

of the Claim, the Claimants say that in the same year Carlota indicated

her intention to sell the property located at No. 9 Far West Street, San

Ignacio Town to them and by a Deed of Conveyance dated the 16 th day

of August 2006 Carlota conveyed the property to them. The Deed of

Conveyance was recorded in Deeds Book Volume 33 of 2006 at Folios

345 to 352 but at the time of the conveyance the said lands were still

undeclared lands and as such they did not apply for First registration of

the lands.

2) At paragraphs 9 and 10 of the Claim, the Claimants say that in or

around March 2008 Carlota became quite ill and they began taking care

of her. Francisco moved back to the property so that he could better

care for his Grandmother. Further, since 1966 Nevia has been in

continuous possession of the said property and since March 2008

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Francisco has been in continuous possession of the property. They say

that neither the Defendant, Olivia nor any other person has sought to

dispossess them of the said premises.

3) At paragraphs 11 and 12 of the Claim, the Claimants say that in June

2009 Carlota’s health significantly deteriorated and she was confined to

her bed until the date of her death, the 11 th day of January 2010. That

from June 2009 to the time of her death Carlota was mentally frail, listless

and was not very coherent in her thoughts and judgment.

4) The Claimants say that in March 2010 they sought to apply for First

Registration of the property but discovered that it was granted to Olivia

on the 24 th day of November 2009 and Certificate of Title was issued to

her on the 30 th day of December 2009. In support of her application for

First registration Olivia submitted a Transfer of Land No. LRS­200911471

dated the 21 st day of November 2009 purportedly executed by Carlota in

which she transferred the property to Olivia.

5) At paragraph 15 of the Claim, the Claimants say that they have a

registrable interest in the said property but no notice was sent to them in

accordance with section 13 (6) of the Registered Land Act Cap 194

requiring them to state their objections, if any, to the First Registration

being issued to the Defendant.

6) The Claimants further say at paragraph 16 that the First Registration and

subsequent Certificate of Title in respect of the said lands were obtained

by Olivia by fraud. The particulars of fraud are:

Particulars of fraud a. The Defendant was always aware that Carlota Quiroz intended to sell

the said lands to the Claimants and was aware that the lands were eventually sold to the Claimants since 2006.

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b. That at the time of the alleged transfer of the lands to the Defendant relations between the Defendant and Carlota Quiroz were strained.

c. That the Transfer of Land could not have vested the Defendant with an interest in the said lands as Carlota Quiroz had already vested all her interest in the land to the Claimants by the Deed of Conveyance of the 16 th day of August 2006.

d. That further, the Transfer of Land is void as it was not executed by Carlota Quiroz of her own free will and volition as it had been obtained by the Defendant by pressure and without her being aware of the true meaning of its contents and through the exercise of undue influence and duress.

4. Relief Claimed

As such, the Claimants claim the following relief:

1. A Declaration that Transfer of Land No. LRS­200911471 is null and void.

2. A Declaration that the First Registration and Certificate of Title with respect to Parcel 731, Block 23, San Ignacio North in the name of the Defendant was obtained by fraud.

3. An order directing the Registrar of Lands that the First Registration and Certificate of Title issued to the Defendants with respect to Parcel 731, Block 23, San Ignacio North be cancelled.

4. An order directing the Registrar of Lands to rectify the register to reflect the Claimants as being the proprietors of Parcel 731, Block 23, San Ignacio North and to issue a Certificate of Title to the Claimants in respect of Parcel 731, Block 23, San Ignacio North.

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5. Statement of Case for the Defence

1) The Defendant disputes the Claimants’ Claim and say that Carlota who

had title to the property gave the original Deed of Assent to her adopted

daughter, Olivia, the Defendant, and made it known to family members

that if she predeceased Olivia, the property would devolve to Olivia.

2) At paragraphs 7 and 8 of the Defence, Olivia says that Carlota in her

last Will prepared by Sabido and Company, Attorneys­at­Law, will the title

of the San Ignacio Town property to Olivia. That on 6 th August, 2004,

Francisco went to the Law Offices of Sabido and Company, and took

possession of and received the Last Will and Testament of the late

Carlota dated 7 th January, 1993 and a copy of the Deed of Assent dated

24 th June, 1988. That since then, the Last Will of Carlota was never

seen again by anyone, and Francisco has refused and failed to explain

what happened to the Will he received from Sabido and Company.

3) Olivia says that the Power of Attorney given to Francisco by Carlota was

to appoint Francisco to manage her properties. That on the 16 August,

2006, Francisco had purported to execute the Deed of Conveyance

between himself (in his personal capacity) and his mother Nevia Quiroz

jointly as Purchasers and himself as agent/attorney of the late Carlota

Quiroz as Vendor of the property. That Francisco therefore, during the

lifetime of Carlota purportedly purchased the property, paid the

consideration to himself as Attorney of Carlota, signed the Deed of

Conveyance to himself and his mother and registered the Deed of

Conveyance at the Ministry of Natural Resources.

4) At paragraph 10 of the Defence, Olivia says that up to the time of her

death, Carlota informed family members that the title to the property was

for Olivia and signed, sealed and delivered transfer documents on 21

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November, 2009 for the transfer of the said property to Olivia in the

presence of Sydney Lionel Codd, Senior Justice of the Peace.

5) Olivia further says that when the late Carlota signed the documents

dated 21 November, 2009 transferring the title to the property to her the

documents were lodged at the Lands Registry, Belmopan City, and as is

the case with First Registrations, details of the application for transfer of

title were published in the Guardian Newspaper and Star Newspaper on

29 November, 2009, to enable persons objecting to the First Registration

to object to the registration. That the Claimants did not object and the

transfer of title was effected, and a Land Certificate was issued to her on

the 30 December, 2009, during the lifetime of the late Carlota.

6) Olivia says at paragraph 14 that on 7 April, 2010, after the death of Carlota

on 11 January, 2010, Francisco then put a caution on the property

prohibiting any dealings in the said land by virtue of the Deed of

Conveyance which he had entered into personally as purchaser and as

agent of the vendor.

7) Olivia further claims that the Claimants committed fraud in executing the

Deed of Conveyance on 16 August, 2006. The Defendant therefore

counterclaims against the Claimants.

6. Relief and Particulars on Counter­Claim

Relief 1) (a) a declaration that the deed of conveyance dated 16 August, 2006 is

null and void and should be removed from the Deeds Book.

(b) an order removing the caution placed on the land by the First Claimant.

(c) an eviction order removing the Claimants from the said land and property at 9 Far West Street, San Ignacio Town.

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2) The Particulars of fraud stated at paragraphs 17 to 20 of the Counter­ Claim are:

Particulars of Fraud

(i) Olivia says that the Claimants always knew that after the death of

Daniel Guiterrez (husband of the late Carlota) and Carlota, title to the

San Ignacio property was to vest in her and that Carlota by her Last Will

expressly stated so. Further, Francisco obtained a copy of the said Last

Will from Sabido and Company which disappeared without explanation

and fraudulently while in his possession and he refuses and fails to

explain what happened to it.

(ii) Olivia further says that the Claimants sought to execute a Deed of

Conveyance to themselves as purchasers of 9 Far West Street

fraudulently and, in the case of the First Claimant, contrary to established

principles of agent. Further, that the Claimants did not object to the First

Registration of the property during the lifetime of Carlota as this would

have exposed their fraud. Also, that they filed a caution prohibiting

dealings in the land only after the death of Carlota.

7. Reply by the Claimants

1) Francisco says that in or around August 2004 the late Carlota and himself

visited the law firm of Sabido & Co. with a view to uplifting her will but was

unable to do so on that date and was asked to return. However, Carlota

was unable to return personally to the law firm so she authorized him to

uplift the will on her behalf. He denies that he refused to explain what

happened to the Will. He claims that he gave the uplifted will to Carlota

who thereafter destroyed it in his presence.

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2) At paragraph 11 of the Reply the Claimants say that the Transfer of Land

dated the 21 st of November 2009 is void. That if it was executed by

Carlota it was not executed by her of her own free will and volition as it

had been obtained by the Defendant by pressure and without her being

aware of the true meaning of its contents and through the exercise of

undue influence and duress.

3) The Claimants deny that any fraud was committed in executing the said

Deed of Conveyance. As such, they deny the Counter­Claim and also

the particulars of fraud.

8. Issues for determination

Whether the late Carlota had the requisite mental capacity to execute

the transfer of land on the 21 st of November, 2009 for the San Ignacio

property.

Whether the Defendant acted fraudulently in acquiring the first registration

and Certificate of Title for the San Ignacio property.

Whether the Claimants fraudulently executed the Deed of Conveyance

dated 16 th August, 2006 for the San Ignacio Property.

9. Evidence

The Claimants filed witness statements and were cross­examined. The

other witness for the Claimants is Dr. Francis Morey. For the Defence

there were four witnesses, the Defendant, her husband Ismael Garcia,

her daughter, Adrianne Garcia and Justice of Peace, Mr. Sydney Codd.

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Submissions by the Claimants

10. The Claimants submit that the late Carlota could only be said to have

had the mental capacity if she was capable of understanding what she

was doing in executing the transfer of land. Further, that the extent of

Carlota’s understanding should have been for her to know that the

Defendant, Olivia would have taken the property absolutely thereby

depriving the Claimants an interest in the property.

11. Learned Counsel Ms. Lochan in her written submissions relied on the

evidence of Dr. Francis Morey, the personal Doctor of the late Carlota

whose opinion is that during the period June 2009 to the date of Carlota’s

death she was not of sound mind and could not have been in control of

her mental faculties to such an extent as to read documents, understand

their contents and agree to the contents. As such Learned Counsel

submits that Carlota was not of sound mind at the time of November 2009

and therefore could not have understood what she was doing and that if

in fact she did place her print on the transfer it was not done of her own

volition as she was incapable of consenting to such a transaction.

Further, Ms. Lochan submits that Dr. Morey’s evidence is corroborated

by the Claimants who took care of Carlota from the time she fell seriously

ill in June 2009 to the date of her death in January 2010. They testified

that Carlota did not recognize persons and when spoken to, and she did

not understand anything.

12. Ms. Lochan submits that the evidence 1 of Mr. Codd, the Justice of the

Peace who claims he witnessed Carlota place her print on the document

shows that at no time did he ask Carlota whether it was her desire to

transfer the land and he never explained to her what were the

1 See paragraph 7 of witness statement of Mr. Sydney Codd

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consequences of her signing the transfer of land and neither did he ask

her whether she understood and agreed with what she was doing by

signing the transfer of land. That in fact, based on Mr. Codd’s testimony

during the entire time that Carlota was at the pharmacy she never spoke

once to him.

13. Learned Counsel relied on the case of In re Beaney 2 in which one Mrs.

Beaney who was suffering from an advanced state of dementia executed

a transfer of her property to her daughter Ms. Beaney. Despite the fact

that Mrs. Beaney was able to speak and did in fact state that she

understood what she was doing the court held that the transfer was void

as Mrs. Beaney did not understand that she was making an absolute gift

to her daughter and because the claims of the plaintiffs and the extent of

the property to be disposed of were not explained to her.

14. Learned Counsel relying on this case submits that since the parties in

this instance did not even engage Carlota in the same questioning and

explanations that were engaged with Mrs. Beanery it cannot be said that

what transpired at the pharmacy is sufficient to satisfy the Court that

Carlota understood what she was doing.

15. Ms. Lochan further submits that the evidence 3 of Mr. Codd as to the

execution of the transfer does not show that Carlota consented to selling

her land to Olivia. That the fact that Carlota moved her head and by this

he believed she was consenting does not mean that she understood what

she was doing and consented to placing her hand on the document.

Learned Counsel contends that pressure and undue influence come in

many forms. That since Carlota was not of sound mind, did not have the

document explained or read over to her it cannot be said that she

2 In re Beaney, Decd (1978) 1 W.L.R 770 3 See paragraph 10, 11, and 12 of Mr. Codd’s witness statement

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understood and approved of the transfer of land and the fact that she was

made to place her print on a document and was not given the opportunity

to state whether she consented or not, amounted to her not executing the

document of her own volition but by pressure or undue influence.

16. Counsel referred the court to the case of Huang Wan Xian Montejo 4

where the testamentary capacity of the testator was in issue. Counsel

submits that though this case involved the execution of a will it is still

applicable to the case at hand as the mental capacity that Carlota

required to execute the transfer of land was the same as if she was

executing a will. Learned Counsel relying on the principles in this case

contends that Carlota was an instrument of those around her. 5 Counsel

further relied on Banks v Goodfellow 6 and submits that the mental

capacity required in order to make a will is that the testator must have a

sound and disposing mind and memory. 7 As such Ms Lochan contends

that the transfer of land dated the 21st of November 2009 is void as

Carlota on that date was of an unsound mind and as such did not

understand that she was executing a transfer of land, she did not

understand what the consequences of the transfer were and she did not

voluntarily place her print on the document.

17. On the claim for fraud, Ms. Lochan submits that Olivia wanted the

property for herself and she adopted fraudulent means by which to acquire

4 Huang Wan Xian Montejo v. Lucinda Montejo, Rachel Montejo Claim No. 177 of 2008 (Belize) 5 Page 32 of Montejo case.

6 (1870) LR 5 QB 549; See also In re Beaney cited by Counsel where it was stated at page 773 that the guiding principle with regard to the mental capacity required in the execution of documents akin to inter vivos dispositions is whether the person concerned is capable of understanding what he does by executing the deed in question when its general purport has been fully explained to him.

7 See Cockburn CJ judgment at page 567

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the property. That she acted fraudulently in acquiring the said transfer of

land and application for first registration because she knew that Carlota

could not execute the documents. Learned Counsel contends that Olivia

knowing that Carlota was not of sound mind, forced her to execute the

transfer of land without getting either medical approval or independent

legal advice. Further, having regard to the conduct of Olivia in respect

to the execution of the Transfer of Land and the eventual acquisition of

the Certificate of Title it can be said that she acted fraudulently in

acquiring the said documents.

18. Ms. Lochan in support of her arguments referred to the evidence which

shows that at the time of the execution of transfer, the late Carlota was so

ill she could not sit up in bed, could not speak, could not eat and could not

walk. Learned Counsel also referred to the inconsistencies in the evidence

as to what took place at the pharmacy which brings into doubt whether

there was ever a meeting at the pharmacy. Learned Counsel also

referred the court to Olivia’s evidence under cross­examination where she

said that though the late Carlota was giving her the property by her will,

yet she bought it from her in 2009. Counsel submits that no explanation

was provided under re examination for this anomaly and the question

therefore arises as to why purchase a property that you were getting for

free.

19. Learned Counsel contends that Carlota never gave Olivia the property

by her will. Further, Olivia never paid the late Carlota $25,000 for the

property, as she claimed, because it seems highly unlikely that a

reasonable person would leave $25,000 with a woman who could not

walk, was frail and had recently had a stroke. As such Learned Counsel

contends that the transfer would have to fail for want of consideration.

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20. Learned Counsel further submits that as a result of Olivia’s fraud in

acquiring the first registration and certificate of title with respect to the San

Ignacio property the register should be rectified pursuant to section 143

of the Registered Land Act cap 194 to reflect the Claimants as being the

true owners.

Submissions on the counter­claim

21. Learned Counsel, Ms. Lochan contends that there is no evidence that the

Claimants acted fraudulently in acquiring the Deed of Conveyance and as

such it should not be deemed to be void and so the counterclaim by the

Defendant should be dismissed.

22. Learned Counsel further contends that by virtue of Deed of Conveyance

dated the 16 th of August 2006, the late Carlota sold the San Ignacio

property to the Claimants. That the said Deed was signed by the 1 st

Claimant in his position of Attorney of Carlota pursuant to power of

attorney dated the 25 th of February 2006. 8

23. Ms. Lochan submits that Francisco did not breach his duties of donee of

the power of attorney and that the conveyance was validly executed. That

Francisco was a gratuitous agent of the late Carlota as he was not paid

for acting on her behalf pursuant to the power of attorney. Learned

Counsel relied on the text Powers of Attorney 9 at p 73­74 which states

that:

The standard of care that an attorney must bring to carrying out his duties varies depending whether or not he is paid. If paid, he must exercise the care, skill and diligence of a reasonable man. Further, if he undertakes those duties in the course of a profession, he must

8 See section 11 of the Power of Attorney relied on by Counsel which gave Francisco the power to take possession of all properties and manage them including mortgaging and sellilng.

9 7 th edition by Trevor Aldridge

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exercise proper professional competence. A volunteer attorney must use such skill as he possesses, and show such care and skill as he would display in conducting his own affairs.

24. Ms. Lochan referred to the evidence of Francisco under cross

examination where he stated that before the Deed of Conveyance was

executed the advice of attorney­law Mr. Cardona was sought and the

Deed was drafted by Mr. Cardona. As such, Francisco discharged

the standard of care placed upon him as he sought legal advice and

pursuant to that legal advice executed the Deed of Conveyance.

Learned Counsel contends that in such circumstances, it cannot be

said that Francisco acted fraudulently but to the contrary he acted just

as how he would have conducted his own business and as a

reasonable man would have acted.

25. Further, Ms. Lochan’s contends that Francisco was merely the agent

of Carlota and was not a trustee. See Lister v. Stubbs 10 relied on by

Counsel. That since he was not a trustee of Carlota he was not

affected by an absolute disability to purchase her property. However,

Francisco owed the late Carlota a fiduciary duty and as such would

have been prevented from purchasing the property if he had been

employed by Carlota to sell the property. Learned Counsel submits

that in this case Francisco was never employed by the late Carlota

and as such is not prevented from purchasing the property. See Treitel on the The Law of Contract. 11

26. Learned Counsel further submits that the locus classicus for this

proposition is the case of McPherson v. Watt. 12 . In that case an

10 (1890) 45 Ch D

11 8 th edition page 647. 12 (1877) 3 App. Cas. 254.

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attorney was employed to sell certain properties. However he advised

the principal not to advertise the properties for sale indicating that he

would find a purchaser. He presented his brother as the purchaser and

the properties were sold to him. However the Appellants later found out

that there was a previous arrangement between the attorney and his

brother that he should have, at half the price, two of the properties,

which he afterwards disposed of at a profit. They brought an action for

an order setting aside the sale on the ground that the attorney was at

the time their agent and excluded from the purchase, except with their

consent. Ms. Lochan after referring the court to Lord O’Hagan’s

judgment submits that the case at bar is distinguishable from this

case for the following reasons:

a. Francisco was not paid by the late Carlota.

b. Francisco’s duty of agent arose from a power of attorney which empowered him to act in the shoes of Carlota but he was not placed in a special relationship where she relied on his advice.

c. Francisco gave evidence that the late Carlota participated in the sale and that she was the one who fixed the sale price. As such at no point in time did he hide from Carlota that he and the 2 nd Claimant were the purchasers.

d. Francisco made no secret profit from the sale. He gave evidence that the money from the sale was deposited into Carlota Quiroz’s joint account and was subsequently used for her medical expenses.

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27. In further support of her argument, Learned Counsel relied on the

case of Michael Kelly and another v. C.H Enderton and Others 13

where it was held that an agent may purchase his principal’s property

if given an option to so purchase from the principal. That in the case at

hand, Carlota had indicated to Francisco that she wished to sell the

property to the Claimants as they took care of her. Further Francisco

stated that Carlota wanted to ensure that the property remained in the

family. As such, Learned Counsel contends that it cannot be said

that Francisco contravened his duties pursuant to the power of

attorney. Therefore, the Deed of Conveyance is not against the

principles of agency and was not acquired fraudulently.

28. Nevertheless, Learned Counsel submits that if the court concludes

that the Conveyance is against the rules of agency this does not

render the Conveyance void but merely voidable and liable to be set

aside by the principal alone if he/she so chooses. 14

Failure to submit Closing submissions

29. It was ordered by the court that the parties should file written closing

submissions by 16 th August, 2011. Up to the date of writing of this

judgment, the court did not receive any submissions from the

Defendant. The court has a duty to write its judgment in a timely

manner and therefore proceeded without the Defendant’s submission.

13 (1913) AC 191 14 See Mc Pherson v. Watt op cit and Treitel on The Law of Contract 8 th edition page 648.

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Determination

Issue 1: Whether the late Carlota had the requisite mental capacity

to execute the transfer of land on the 21 st of November, 2009 for the

San Ignacio property passing title to Olivia.

30. It is not disputed that at the time of the execution of the transfer that

the late Carlota was very sick. What is disputed is her mental

capacity. It is therefore necessary to examine the evidence as to her

mental capacity. The starting point however, is the law on mental

capacity.

Mental capacity 31. In the case of re Beaney cited by Learned Counsel Ms. Lochan it is

stated that the guiding principle with regard to the mental capacity

required in the execution of documents akin to inter vivos dispositions

is whether the person concerned is capable of understanding what he

does by executing the deed in question when its general purport has

been fully explained to him. 15 Mr. Martin Nourse Q.C in that case

stated that:

The degree or extent of understanding required

in respect of any instrument is relative to the

particular transaction which it is to effect. In the

case of a will the degree required is always high.

In the case of a contract, a deed made for

consideration or a gift inter vivos, whether by

deed or otherwise, the degree required varies

with the circumstances of the transaction. Thus,

15 (1978) 1 W.L R 770 at page 773

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at one extreme, if the subject matter and value of

a gift are trivial in relation to the donor's other

assets a low degree of understanding will suffice.

But, at the other extreme, if its effect is to

dispose of the donor's only asset of value and

thus, for practical purposes, to pre­empt the

devolution of his estate under his will or on his

intestacy, then the degree of understanding

required is as high as that required for a will, and

the donor must understand the claims of all

potential donees and the extent of the property

to be disposed of. 16

32. I agree with Learned Counsel Ms. Lochan that the guiding principle

stated in re Beaney is applicable to this case. The San Ignacio

property that was allegedly transferred by Carlota to Olivia was her

only property. At the time this was done, Carlota had a stroke. The

court has to ask itself whether Carlota was capable of understanding

what she was doing. The court did not find Olivia’s evidence credible

that she paid $25,000.00 for the property. As such, since there was

no consideration and the property was Carlota’s only asset of value,

the degree of understanding required by Carlota was as high as that

required for a will and she must have understood the claims of all

donees and the extent of the property that she was disposing.

33. The requirement for mental capacity when making a will is stated in

the case of Banks v. Goodfellow and the Montejo case cited by

Learned Counsel. There it is stated that it is necessary that a

testator be of sound mind, memory and understanding when making

16 See page 774

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a Will. The degree of mental competence to make a Will was

enunciated by Cockburn CJ at page 567 quoting from Harrison v.

Rowan 3 Washington at 595:

As to the testator's capacity, he must, in the

language of the law, have a sound and disposing

mind and memory. In other words, he ought to

be capable of making his will with an

understanding of the nature of the business in

which he is engaged, a recollection of the

property he means to dispose of, of the persons

who are the objects of his bounty, and the

manner in which it is to be distributed between

them. It is not necessary that he should view his

will with the eye of a lawyer, and comprehend its

provisions in their legal form. It is sufficient if he

has such a mind and memory as will enable him

to understand the elements of which it is

composed, and the disposition of his property in

its simple forms.

Analysis of the evidence of Carlota’s mental capacity

34. The evidence of Dr. Francis Morey, who is a medical practitioner

specialized in the field of internal medicine is that he has been

been an internist/intensive specialist in the country of Belize since

in or around 2002. In his witness statement he stated that the late

Carlota was his patient since around February of 2003.

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35. Dr. Morey stated that in March 2008, Carlota suffered a fracture to

her hip which impeded her physical mobility. Apart from that, she

had high blood pressure and a history of urinary tract infections.

That in June of 2009 her medical condition severely deteriorated

as she suffered from a cerebral stroke. At paragraph 5 of his

witness statement, Dr. Morey explained that a cerebral stroke is

caused by a blood clot that forms in the brain which is referred to

as a thrombus. This blood clot lodges itself in the brain and causes

severe brain damage.

36. Dr. Morey stated that Carlota suffered brain damage to the right

part of her brain which produced hemiparalysis of the left side of

her body and as a result of this she was bedridden and unable to

walk. Further, as a result of being bedridden, Carlota eventually

lost control of her muscles and could not move on her own. This

caused her to develop pressure ulcers on her back and heel along

with pneumonia. Also she was unable to swallow and as such

needed to be fed by syringe as of June 2009.

37. Dr. Morey further stated that as a result of Carlota’s medical

condition, all examinations of her after June 2009 were conducted

at her home at No. 9 Far West Street, San Ignacio. Further, he had

to regularly examine her so as to guard against her contracting

any infection in her lungs.

38. Dr. Morey at paragraph 9 of his witness statement stated that during

the medical examination he conducted neurological examinations of

the late Carlota. He went on to explain at paragraphs 13 and 14 as

to what is done during such an examination. He stated that a

“neurological examination is an assessment of sensory neuron and

motor responses, especially reflexes, to determine whether the

nervous system is impaired.” He also explained that during this

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examination an assessment is made of the photo motor reflex to check

for swelling of the brain as well as the plantar reflexes to check for

further brain damage.

39. Dr. Morey further stated that Carlota was also asked to move her

eyes, arms and her legs on command. However, she failed to perform

the acts requested and did not speak. She was not conscious of

where she was, who she was and was unable to recognize people.

Further she was unable to understand when spoken to.

40. From paragraphs 16 to 21 of Dr. Morey’s witness statement he stated

the following:

16. In my professional opinion Carlota Quiroz since June

2009 was not lucid and was of an unsound mind and

her nervous system impaired.

17. This was primarily caused by the cerebral stroke but her

mental and physical health worsened because of her

age.

18. In 2009, Ms. Quiroz was 91 years old and as such was

suffering from a degree of senility and dementia. A

person who is suffering from senility has a reduced

mental function.

19. Since June 2009, I visited Carlota Quiroz approximately

once per month and in none of those visits was Carlota

Quiroz able to talk or of sound mind, in fact, I found that

her mental and physical health continued to deteriorate.

My last visit with Ms. Quiroz was in December 2010.

22

20. That Carlota Quiroz remained in a frail and unresponsive

medical and mental health until the date of her death on

the 11th of January, 2011.

21. In my professional opinion, Carlota Quiroz during the

period of June 2009 to the date of her death was not of

sound mind and could not have been in control of her

mental faculties to such an extent as to read documents,

understand their contents and agree to the contents.

41. In cross­examination of Dr. Morey by Dr. Kaseke he was asked

about the medical records concerning Carlota. He testified that he did

not have the documents but that he knows his patient and he knows

that she was not lucid.

42. There is no dispute that the late Carlota had a stroke and that

Dr. Morey was her Doctor. I accept the evidence of Dr. Morey that

in 2009 when the late Carlota was 91 years old her medical

condition severely deteriorated as she suffered from a cerebral

stroke which severely damaged her brain. I have no reason to

doubt Dr. Morey’s professional opinion that during the period of

June 2009 to the date of Carlota’s death she was not of sound

mind and could not have been in control of her mental faculties to

such an extent as to read documents, understand their contents

and agree to the contents. This is because of the stroke which

severely damaged her brain. As such, I find that the late Carlota

since June of 2009 to the date of her death was not of sound

mind, memory and understanding.

43. I do not accept the evidence of the Justice of Peace, Mr. Codd who

witnessed the execution of the Transfer that although Carlota looked

23

frail and ill she responded whenever he asked her any question by

nodding her head in agreement to his questions. Carlota was not lucid

and she was of unsound mind and therefore could not understand

what was transpiring. I do not believe Mr. Codd’s evidence that

Carlota did everything voluntarily when he asked her and that she

placed her left index finger voluntarily on the ink pad, then later on the

land transfer form.

44. Mr. Codd by his own evidence recognized that Carlota was very ill. He

said that on the 21 st November, 2009, he was at his pharmacy in

San Ignacio Town when Olivia, her husband Ismael Garcia and the

late Carlota went to his pharmacy in the late afternoon and Olivia

informed him that she wants a Justice of the Peace to witness the

signature of a land transfer form as Carlota wanted to transfer some

land in San Ignacio Town to her. He said that Olivia showed him the

form which was blank since she said the late Carlota was ill. He

further stated that Carlota appeared frail to him as she was sitting in a

chair. This evidence shows that no instructions were given to Mr.

Codd by the late Carlota who obviously could not do so because of

her mental condition.

45. According to Mr. Codd, Olivia completed the details on the land

transfer form, signed it and he witnessed her signature and affixed his

stamp as a Senior Justice of the Peace. He then took the form from

Olivia to Carlota who was sitting next to Olivia and informed her that

he was going to witness her signature on the form. Mr. Codd stated

that Carlota nodded her head, signaling that she understood him. In

my view, whether Carlota nodded her head or not is irrelevant as it is

without doubt that Carlota could not understand the nature of the

transaction because of her mental condition.

24

46. My further difficulty with Mr. Codd’s evidence is the placing of Carlota’s

mark on the Transfer form. Mr. Codd stated that Carlota’s hand was

not steady so he asked her if she wanted to place a mark on the land

transfer form by placing her left index finger on the space provided to

signify her signature and she nodded her head in agreement. He said

that he then took his ink pad and placed her left index finger in it and

then placed the said finger with the ink on the space provided and he

witnessed her mark by signing as a witness and affixing his stamp as

a Senior Justice of the Peace. As shown above, Carlota did not

have the mental capacity to understand anything and was also

physically impaired. If it is Carlota’s thumb print on the transfer form

then it could not have been placed there with Carlota’s consent as she

was not capable of giving her consent. As such, I reject the evidence

of Mr. Codd that Carlota understood him and communicated to him by

nodding her head.

47. The court also rejects the evidence given by Olivia that Carlota was

lucid when the application for Registration of the San Ignacio property

was made and thereafter transferred to her. Olivia’s evidence is that

on the 21 st November, 2009, Carlota applied personally for First

Registration in her name for the Property. 17 I note that the Justice of

the Peace, Mr. Codd did not witness the execution of this form for first

Registration which I find strange since it was done on the same day as

the Transfer to Olivia. At paragraph 12 of Olivia’s witness statement

she stated that on the said day, 21 st November, 2009, Carlota also

signed a Transfer of Land Form, transferring the property to her for

the consideration of $25,000.00. That Carlota effected the transfer by

placing her finger on the transfer paper. Olivia stated that at the time

17 See Exhibit “OG 3” for a copy of First Registration which was registered on the 24 th , November, 2009 by the Registrar of Lands.

25

Carlota was lucid, in her proper sense, and there was no duress or

undue influence exerted on her. 18

48. The medical evidence before the court which carries great weight shows

that Carlota was not of sound mind and could not have been in control

of her mental faculties to such an extent as to read documents,

understand their contents and agree to the contents. As such, I do not

accept Olivia’s evidence that Carlota was in her proper sense.

Conclusion

49. In June of 2009 when Carlota purportedly placed her thumb print on

the Transfer Form transferring the property to Olivia she was of

unsound mind and her nervous system impaired. She could not have

understood the nature of the transaction and could not have willingly

placed her thumb print on the form. Carlota’s condition did not satisfy

the test in re Beaney as she was not capable of understanding

what she was doing. Further, she did not have a sound and

disposing mind as required in Banks v Goodfellow. As such, I find

that the late Carlota did not have the mental capacity to execute the

transfer of land on the 21 st of November, 2009. I therefore, declare

that the Transfer of Land No. LRS­200911471 is null and void.

Issue 2: Whether the Defendant acted fraudulently in acquiring the first registration and Certificate of Title for the San Ignacio

Property.

50. The particulars of fraud as pleaded in my view does not establish fraud

by Olivia. I have taken into consideration that Daniel Guitterez had left

18 See Exhibit “OG 5” for a copy of the Land Transfer Form.

26

the property by Will to the late Carlota and if she died before him, then

Olivia was to inherit the property. The Claimants did not dispute this

evidence. However, Daniel died before Carlota and she later made

her own Will which according to the evidence of Francisco was

destroyed by the late Carlota. There is no evidence as to the contents

of that Will. Olivia’s evidence is that in 2007 when Carlota was alive

she heard rumours that Francisco said the property was for him.

When she enquired from Carlota about this, she said that Carlota

informed her in the presence of her daughter Adrianne that the

property was for her. Adrianne also gave evidence to the same effect.

As such, I am not convinced that Olivia was aware that the lands

were sold to Francisco since 2006 as pleaded by the Claimant. Also,

there is no evidence that Olivia knew of the Deed of Conveyance

dated 16 th day of August 2006 which shows that Francisco and his

mother had ownership of the property.

51. Further, though there is evidence that the relationship between Olivia

and Carlota was strained at the time of the transfer to Olivia and that it

was the Claimants who were taking care of Carlota, this in my view

does not show fraud. The relationship was strained but not severed

and this was caused because of the bad relationship between

Francisco and Olivia.

52. Also, I do not agree with Learned Counsel, Ms. Lochan that the

Transfer of Land is void because of pressure by Olivia on the late

Carlota. In my view, pressure was not used on Carlota at all. It

seems to me that Carlota was merely an instrument as her thumb print

was placed on the transfer form by the Justice of Peace, Mr. Codd.

Olivia thought Carlota was lucid and was aware what she was doing

when she nodded her head. She was wrong as the medical

diagnosis shows otherwise. The late Carlota was not of sound mind

27

and therefore could not understand what transpired before the Justice

of Peace, Mr. Codd. In my view, the intention by Olivia to defraud is

lacking. As such, I find that the Defendant, Olivia did not act

fraudulently in acquiring the first registration and Certificate of Title for

the San Ignacio Property.

Issue 3: Whether the Claimants fraudulently executed the Deed

of Conveyance, and, in the case of the First Claimant, contrary to

established principles of agency.

53. Olivia claims that the Claimants committed fraud in executing the Deed

of Conveyance on 16 August, 2006 and as such she counter­claims

for several declarations including that the deed of conveyance is null

and void. Olivia says it is fraud because the Claimants knew that after

the death of Daniel Guiterrez and Carlota the property was to be for

her and that Carlota’s so expressly stated and Francisco obtained a

copy of the said Last Will from Sabido and Company which

disappeared without explanation and fraudulently while in the

possession of Francisco who refuses and fails to explain what

happened to it.

54. I will start with the Will 19 of Daniel Guiterrez which states:

I GIVE DEVISE AND BEQUEATH my freehold land and property together with all buildings and erections standing and being thereon situate at No. 9 Far West Street, San Ignacio Town, Cayo District to CARLOTA QUIROZ in fee simple absolutely; but if the said CARLOTA QUIROZ should die before me then I GIVE DEVISE AND BEQUEATH my aforesaid property to OLIVIA

19 See Exhibit “M.G. 1” for a copy of the Will of the late Daniel Guitterez who is the adopted father of Olivia.

28

SANDRA HERNANDEZ my adopted daughter also of San Ignacio Town, Cayo District, Belize.

55. I agree with Learned Counsel, Ms. Lochan that the words of the Will in

their ordinary and plain meaning shows that Daniel Gutierrez wished

to give his property to his wife the late Carlota and it is only if she

predeceased him that the property should be for Olivia. Daniel did

not say that after Carlota’s death the property would be for Olivia.

This means that Carlota who survived her husband could do

whatever she wants with the property.

56. The evidence is that Daniel died and Carlota as executrix of that Will

vested the property in herself as the sole beneficiary. 20 The evidence

also shows that Carlota made a Will but that Will is not before the

court and Sabido and Company who prepared that Will was not called

to give evidence as to the contents of the Will. It is not disputed that

Francisco uplifted that Will from Sabido and Company for his

grandmother. As to what happened to that Will, the evidence of

Francisco is that it was destroyed by the late Carlota. There is no

evidence that the Will fraudulently disappeared while in the possession

of Francisco as claimed by the Defendant.

57. The court will look at the actions of the late Carlota after the will was

supposedly destroyed by her. The evidence shows that she executed

a Power of Attorney 21 for Francisco to be her attorney to manage all

her lands and buildings including:

4. To buy, sell, exchange, encumber, or create or accept

any legal or equitable interest in land of any tenure.

20 See Exhibit “O.G. “ for the Assent. 21 See Exhibt “F.Q. 2”.

29

5. To mortgage, charge, pledge, or create a lien over deliver

as security or deposit the title deeds of all or any of my

property.

11. Generally to take possession of all my properties of

every kind and to retain, manage, turn to account,

mortgage, charge, sell and realize the same and

otherwise act in relation to my estate and affairs as fully

and effectually in all respects as I could act myself.

58. At paragraph 12 of the Power of Attorney the late Carlota stated

that whatever her attorney does, she will ratify and confirm. It

can be seen from the terms of this Power of Attorney that Francisco

was given very wide powers which include buying, selling and

mortgaging property. What is some comfort to the court is that this

Power of Attorney was prepared in February of 2006 by the law

firm of Shoman and Chebat, Attorneys­at­law and was signed by

the late Carlota. At this time, she did not have a stroke and so her

brain was not damaged. In any event, there is no issue before the

court as to the validity of this Power of Attorney.

59. It is this Power of Attorney which was given to Francisco that he

used to sell the property to himself and his mother. The Deed of

Conveyance 22 which is dated 16 th of August, 2006 was prepared

by Attorney­at­law, Jose Cardona. Mr. Cardona obviously

prepared this Deed on the authority of the Power of Attorney as it

states:

22 See Exhibit “F.Q. 3”

30

SIGNED, SEALED AND DELIVERED by

Francisco Javier Quiroz the lawful agent of

Of Carlota Quiroz by virtue of Power of

Attorney dated 25 th February, 2006 recorded

in Deeds Book 7 of 2006 at folios 1197­1204.

60. Under cross­examination of Francisco by Dr. Kaseke he said that

before the Deed of Conveyance was executed the advice of

attorney­law Mr. Jose Cardona was sought who indicated to him

that he could have conveyed the property pursuant to the Power of

Attorney. I have no doubt that Francisco sought legal advise as it is

not disputed that Mr. Cardona prepared the Deed of Conveyance.

In fact, it is stated on the Deed that Cardona prepared the Deed

and he also signed after counting the folios. Mr. Cardona was

not called to give evidence in this case and so the court cannot say

whether he spoke to the late Carlota on the sale to Francisco.

61. The question for the court is whether the Deed of Conveyance was

executed contrary to principles of agency since Francisco was

Carlota’s agent pursuant to the Power of Attorney and he sold the

property to himself and his mother, the second Claimant. I accept

Ms. Lochan’s submissions that an agent owes to his principal

fiduciary duties (duties of loyalty). Further, I also accept her

submissions that Francisco was not a trustee and therefore was not

affected by an absolute disability to purchase Carlota’s property.

This is because the property in contention is not a “trust property”.

31

Responsibilities of Agent

62. Francisco’s responsibility as an agent is for any loss occasioned

by his want of proper care, skill or diligence. In Halsbury’s Laws

of England 23 it states that:

An agent is responsible to his principal for any

loss occasioned by his want of proper care, skill or

diligence, in the carrying out of his undertaking

even though the principal has himself been

negligent in not discovering the agent’s breach of

duty. No absolute standard can be laid down as

to what constitutes proper care, skill or diligence

and each particular case must be judged by its

own circumstances.

63. In the case at hand, Francisco was a gratuitous agent as he was

not being paid by his grandmother. Therefore, he is only bound to

use such skill that he has and which he would ordinarily use in his

own affairs.

Extent of duties

64. In Bowstead on Agency 24 it is stated that in general the duties of

an agent may be expressed as requiring the agent not to allow his

own personal interests and his duty to his principal conflict, without

full disclosure to his principal. If he enters in such transactions the

principal must have full knowledge of all the material

circumstances and give her consent.

23 4 th Edition at paragraph 776 24 Fifteenth edition, page 159

32

65. The authority Mc Pherson v Watt cited by Learned Counsel Ms.

Lochan are not on all fours with the case at hand and so she

sought to distinguish it for several reasons at paragraph 26 above,

to which I agree. However, I find Lord O’Hagan’s judgment helpful.

At page 266 of the judgment Lord O’Hagan stated the following:

An attorney is not affected by the absolute disability to purchase which attaches to a trustee. But, for manifest reasons, if he becomes the buyer of his client's property, he does so at his peril. He must be prepared to shew that he has acted with the completest faithfulness and fairness; that his advice has been free from all taint of self­interest, that he has not misrepresented anything, or concealed anything, that he has given an adequate price, and that his client has had the advantage of the best professional assistance which if he had been engaged in a transaction with a third party he could possibly have afforded.

66. In applying the principle of the Mc Pherson case to the case at

bar, it is my view that since the Power of Attorney given to

Francisco by the late Carlota did not state specifically that he can

purchase the property, Francisco is required to show to this court

that (1) Carlota gave him consent to purchase the property (2)

Carlota fixed the purchase price and (3) Carlota benefitted from the

sale.

67. Francisco’s evidence which I find credible is that Carlota

participated in the sale and that she was the one who fixed the

sale price. The money from the sale was deposited into Carlota’s

joint account with himself and was subsequently used for her

medical expenses. Also, Carlota had indicated to Francisco that

she wished to sell the property to the Claimants as they took care

33

of her and she wanted to ensure that the property remained in the

family.

68. Further, it is not disputed that Francisco and the second Claimant

took care of the late Carlota after she became very ill until her

death and that Olivia at the time did not have a close relationship

with her. It is not disputed also that Francisco who is her grandson

is her only blood relative. Also, Francisco and Carlota had a joint

account and the money was used to take care of Carlota which

includes paying her medical expenses. Even further, the evidence

proves that an attorney at law prepared the Deed which shows

that Francisco took proper care and sought professional advice.

69. Having taken all of the above circumstances into consideration, I

am satisfied that there was no impropriety on the sale of the San

Ignacio property to Francisco. Accordingly, I find that Francisco

did not breach the principles of agency in executing the Deed. It

follows that the Claimants did not fraudulently execute the Deed of

Conveyance.

70. Based on the foregoing the Counterclaim is dismissed.

71. Conclusion

I find that the late Carlota did not have the mental capacity to

execute the transfer of land for the San Ignacio Property on the

21 st of November, 2009. I therefore, find that the Transfer of Land

No. LRS­200911471 is null and void.

I find that the Defendant did not act fraudulently in acquiring the

first registration and Certificate of Title for the San Ignacio property.

34

I find that Francisco did not breach the principles of agency in

executing the Deed. It follows that the Claimants did not

fraudulently execute the Deed of Conveyance for the San Ignacio

property. According, the Counterclaim is dismissed.

72. In the circumstances, I grant the following relief:

Order

1. A Declaration that Transfer of Land No. LRS­ 200911471 is null and void.

2. An order directing the Registrar of Lands that the First Registration and Certificate of Title issued to the Defendant with respect to Parcel 731, Block 23, San Ignacio North be cancelled.

3. An order directing the Registrar of Lands to rectify the register to reflect the Claimants as being the proprietors of Parcel 731, Block 23, San Ignacio North and to issue a Certificate of Title to the Claimants in respect of Parcel 731, Block 23, San Ignacio North.

4. Prescribed costs in the sum of $3,000. is awarded to the

Claimants.

………………………. Minnet­Hafiz­Bertram Supreme Court Judge

Dated this 1 st day of November, 2011.