Home | Databases | WorldLII | Search | Feedback Court of Appeal of Fiji

South Pacific Recording Ltd v Eros Multimedia PVT Ltd [2011] FJCA 55; ABU0044.2010 (25 November 2011)

IN THE COURT OF APPEAL, FIJI ISLANDS
APPELLATE JURISDICTION

CIVIL APPEAL NO.ABU0044 OF 2010

BETWEEN:

SOUTH PACIFIC RECORDING LIMITED
Appellant

AND:

EROS MULTIMEDIA PVT LIMITED
Respondent

CORAM: Hon. Justice William Marshall, Justice of Appeal
Hon. Justice Sriskandarajah, Justice of Appeal
Hon. Justice Nimal Wikramanayake, Justice of Appeal

Counsel: Ms M. L. Muir for the Appellant
Ms T. Draunidalo for the Respondent

Date of Hearing: Thursday, 9 November 2011
Date of Judgment: Friday, 25 November 2011

JUDGMENT

William Marshall, JA

1. I agree with the judgment, the reasons and the proposed orders by Nimal Wikramanayake JA.
   

Sriskandarajah, JA

2. I also agree with the judgment, the reasons and the proposed orders by Nimal Wikramanayake JA.
   

Nimal Wikramanayake, JA

3. This is an appeal brought by South Pacific Recordings Limited, the original defendant in proceedings brought against it by Eros Multimedia PVT Limited from a judgment of Justice Yohan Fernando delivered at the High Court at Lautoka on 2nd July 2010 where His Lordship entered judgment against the Appellant and ordered that the Appellant pay to the Respondent Eros Multimedia PVT Limited the sum of F$12,500.00 together with interest thereon at 6% per annum or legal interest, whichever is less, from 7th December, 2004 and payment in full together with costs of F$5,000.00 be set aside.
   
4. The plaintiff issued a Writ of Summons out of the High Court at Lautoka on 2nd March 2006 claiming:
   
   1. That all material times it was a copyright holder and licensee for distributing theatrical print of Hindi movies within the Republic of the Fiji Islands.
      
   2. The plaintiff verbally by telephone appointed the defendant be its agent.
      
   3. The plaintiff forwarded 19 Hindi movies in 45 theatrical prints to the defendant to be played in a cinema house in Fiji.
      
   4. In 2004 the plaintiff appointed Eros (Pacific) Limited in Fiji as its agent and terminated the defendant's agency contract. On 26th October 2004 Eros (Pacific) Limited requested the defendant in writing to return 45 theatrical prints to its company in Fiji.
      
   5. On 6th December 2004 the defendant returned 15 movies and 20 theatrical prints to the plaintiff and refused and neglected to forward balance 15 and films and 25 prints to the Plaintiff as a result of which the plaintiff suffered loss and damage to the sum of US$30, 000.00 in 25 prints at the cost of US$ 1,200 each.
      
5. The defendant filed a defence in the action denying that it had been appointed the plaintiff's agent. There was an informal arrangement between the plaintiff and the defendant to show the plaintiff's movies and theatrical prints in cinema houses around the country at the plaintiffs' instruction. The defendant received only a small percentage of the proceeds of the plaintiff and only assisted the plaintiff as a matter of courtesy, without any significant financial benefit to itself. It admitted that the plaintiff appointed Eros (Pacific) Limited in Fiji as its agent, acknowledged the request by Eros (Pacific) Limited for the theatrical prints and then it did return some theatrical prints to the plaintiff after its relationship ended. The defendant further denied that it has neither refused nor rejected to return the said theatrical prints as there was no arrangement between the plaintiff and the defendant for their return. The defendant endeavoured to retrieve as many theatrical prints as possible from cinema houses, but could not find the other prints nor was it the responsibility of the defendant to do so.
   
6. The case came on for hearing before Justice Yohan Fernando on 11th May 2010 and the plaintiff called two witnesses to give evidence on its behalf. The first witness was Mr Banga Rajesh who was employed by the plaintiff company as the Chief Executive Officer. He said that the defendant company was paid a commission of 12½ % for distributing films on the plaintiff's behalf to cinemas in Fiji. Plaintiff started the new distribution in Fiji under the name of Eros Pacific and asked the defendant to return the prints to Eros Pacific Limited for re-distribution of the prints. He stated further that the plaintiff had a written agreement with the defendant, and 45 prints were given to the defendant, 20 prints were returned, leaving 25 still unreturned by the defendant. These prints costs US$1,200 each and the loss and damage suffered by the plaintiff was $30,000.00.
   
7. In cross-examination he stated that he was not aware that "plaintiff and defendant did movies for 20 years".
   
8. The plaintiff called the 2nd witness Jayanti Lal Raniga to state that he was now a Director of Eros Pacific. He was the Marketing Manager of the Plaintiff company in 2004 but employed by the defendant prior to that. He was the sole person that, dealt with the plaintiff on behalf of the defendant. He also stated that Mr Ravind Patel was the Managing Director of the defendant and also dealt with the plaintiff. He added that 25 out of the 40 prints were sold to Singapore. This was on Ravind Patel's instructions. He was asked who was the owner of the movies and he stated Eros.
   
9. Raniga was cross examined by the defendant's counsel and admitted that he was employed by the Appellant/defendant from the year 1990. He was asked whether there "was at any part of time any films shipped back to India?" He answered "No".
   

He was also asked and he answered as follows as the Judge's note of evidence shows:

"Q. Why did Plaintiff wait 2 years to ask for them?

1. I would not know.

Q. Were you with the Plaintiff at that time?

A. Yes.

Q. That was not a business arrangement between Plaintiff and Defendant for 20 years?

A. Plaintiff witness the letter.

Q. When you were with the Defendant did you receive letters like this (P12) from the Plaintiff?

A. No."

In re-examination he was asked and answered:

"Q. When did relationship between Plaintiff and Defendant commence?

1. 1996 less than 20 years.

Q. Reason for asking for the return of the movies? In 2004?

A. [no answer recorded] ...

...Q. Were the titles sold?

A. Yes.

Q. How did you know $500?

A. I know. Dealing with Swastik was going on.

Q. On whose instructions?

A. Mr Patel's."

10. The Hearing was then adjourned to Friday 14th May, 2010 when Mr Ravindra Patel Managing Director of the defendants give evidence. He stated that Mr Jack Raniga was in-charge of Capital VHS and several light films. He said "Behind my back Jack 'defected' (and) opened an office Eros in Fiji".
    
11. In cross-examination Mr Patel was asked and answered as follows:
    

"Q. Ownership of those movies belong to whom?

1. Do not know.

When you run the movies they are of no value ...

... Last 6 years no movies sent back.

Q. Why did you return the other movies?

A. To get the space.

Norm is not to return ...

... Q. How were movies that were returned by Defendant to Plaintiff done?

How did you physically return the film rolls to the Plaintiffs possession?

1. Plaintiff came and picked it up from our premises".
   

12. The evidence disclosed that the plaintiff and the defendant had been doing business for over sixteen years. And during that period of time, whilst they were doing business the defendant was never requested to return the prints of the films to the plaintiff, nor did it ever return the films, until the agency was terminated. According to the defendant's Managing Director, Jack Raniga, his Manager, defected to the plaintiff, who obviously told the Plaintiff Chief Executive Officer, that he had sold some of his prints for and on and behalf of the defendant. I assume that this is probably what prompted plaintiff to bring the present action.
    
13. At the Pre-Trial conference held on 5th August 2008, it was admitted that the plaintiff appointed the defendant to be its agent in Fiji, the plaintiff than forward movies in the number of prints as alleged, and that the defendant did fail to return 25 prints.
    

In his judgment Justice Yohan Fernando pointed out in paragraphs 29 and 30:

"29. It is an agreed fact that 'the plaintiff did appoint the defendants to be their agents in Fiji' as per the agreed fact (i) of the PTC minutes. As this is an agreed fact it becomes a constant fact that, that the parties cannot vary midstream in the trial. As such for the moment I'll ignore any submissions suggesting otherwise.

30. Based on the submitted fact of agency I shall proceed to determine whether the Defendant is obliged to return the relevant prints as above without reference to any particular term over an alleged contract. As between the agent and the principal the agent cannot contest the title of the principal. As such in respect of all the prints that have been delivered to the Defendant by the Plaintiff as its principal the Defendant cannot, to retain the prints, urge a defence that the Plaintiff has not title to them".

14. This conclusion by the learned trial judge is completely unwarranted for the defence of the Defendant was that there was no obligation under the terms of the contract for it to return the prints to the Plaintiff. The evidence in the case was that the parties had a relationship for over 16 years and in that time the Plaintiff delivered prints to the Defendant to be used in the cinemas and there was no term in the arrangement that the Defendant was to return the prints to the Plaintiff once it had shown the films in the cinemas. It was never asked to return the prints after the films were shown, nor did the Defendant ever return any of the prints to the Plaintiff during the period of its agency. A strong inference can be drawn that after Raniga defected to the Plaintiff he told the Plaintiff that he had been selling used prints for and on behalf of the Defendant and, if I might be permitted to use a colloquialism, the Plaintiff decided "to get it on the act" and claimed original price of the prints being US$1,200 for each print.
    
15. My conclusions are supported by the observation of the learned trial judge at paragraphs (34-36) when he says:
    

"34. It is surprising that the Plaintiff did not enter into at least a Memorandum of Understanding with the Defendant. It is not unusual for civil litigants, to keep some documents from the public eye in their mutual interest. In the absence of documentary evidence of the terms of the contract Court has to consider the oral evidence the parties at the inception of the contract, and during the implementation of the contract.

35. The only available witness who could speak to the terms on the inception of the contract was the Defendants only witness Mr Patel. The Plaintiff first witness was not with the plaintiff at the inception of the contract or during its implementation, he joined the plaintiff well after the termination of the contract.

36. The Plaintiffs second witness [Mr Jack Raniga] however was a privy to the implementation of the contract as the Marketing Manager of the Defendant. Both the Plaintiff second witness and the Defendants only witness were unanimous in their evidence that during the business relationship of the Plaintiff and the Defendant for over ten (10) years, the plaintiff never sought the return of the prints or the transmission of the prints to any country for the re-runs. Further it is difficult to accept that Distributors or cinema houses had accepted used prints to screening".

It is therefore obvious from the conclusions of the trial judge I referred to above that during the business relationship between the Plaintiff and the Defendants over a number of years [over ten years as referred to by the trial judge] the Plaintiff never sought the return of the prints nor the transmission of the prints to any other country for re-runs because of the poor quality of the prints.

16. Accordingly there was only one conclusion the trial judge could ever have arrived at, and that was, that it was not a term of the oral contract between the Plaintiff and the Defendants that the prints were to be returned to the Plaintiff at the end of the screenings.
    
17. However, the trial judge arrived at a most unusual conclusion at paragraph 42 when he stated:
    

"42. However, the basis of the damage to the Plaintiff is the Defendant profiting by the sales of the prints and not disclosing and remitting the profit to the Plaintiff. The prints belong to the Plaintiff on the Defendants admission. The sale of the prints to proceeds in law ought to go to the Plaintiff. It was not shown by the Plaintiff that the raw material of the prints have a value. On the other hand what can be recovered in lieu of the return of the print to its market value, and not its costs, as it has been used, and profit gained from it. The only evidence of that market value is the price at which the Defendant through the Plaintiff second witness is said to have sold the prints to a third party, which at F$500 per print". [$600.00 by the trial judge.]

18. I find that there is no merit whatsoever in the trial judge's conclusion and I also find that the Plaintiff and the Defendant had a business relationship over many years during which the Plaintiff delivered prints to the Defendant for use in cinemas in Fiji firstly that these prints were never returned to the Plaintiff and secondly, the reason why they were not returned to the Plaintiff was because it was not a term of the contract between the Plaintiff and the Defendant.
    
19. Accordingly I propose that the Appeal be allowed and I propose that the judgment of Justice Yohan Fernando be set aside. I would order that the Plaintiff pay to the Defendant the cost of this Appeal assessed at $2,000 and the cost of the Trial in the lower Court is assessed at $5,000.
    

William Marshall, JA

20. The orders of the Court are:
    

ORDERS OF THE COURT

(1) Appeal of the Defendant Respondent is allowed. Costs and interest and the orders for damages in the Court below are set aside.

(2) That the Plaintiff Appellant pay to the Defendant Respondent the costs of the hearing of this Appeal assessed at $2,000.

(3) That the Plaintiff Respondent pay to the Defendant/Appellant costs of the Hearing the High Court at Lautoka assessed at $5,000.

................................................................
Hon. Justice William Marshall
Justice of Appeal

..............................................................
Hon. Justice Sriskandarajah
Justice of Appeal

...............................................................
Hon. Justice Nimal Wikramanayake
Justice of Appeal