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Khan v Hamid [2010] FJMC 98; Criminal Case 81 of 2009 (27 August 2010)

IN THE FIRST CLASS MAGISTRATES COURT
AT NAUSORI
FIJI ISLANDS

Civil Case No: 81 of 2009

Mohammed Afzal Khan
Plaintiff

V

Abdul Hamid
Defendant

Before: C. Lakshman
Resident Magistrate

Plaintiff – Present with Mr Ram Chand
Defendant – Present with Mr Irshad Samad

JUDGEMENT

INTRODUCTION

On 28th day of September 2009 the Plaintiff filed a Writ seeking a judgement for a sum of $15,000.00 given to Defendant as a loan to set up a business, interest on the adjudicated sum at the rate of 5 % and costs.

The Defendants on 9th December 2009 filed a Statement of Defence and a Counter Claim. On 15th January 2010 the Plaintiff filed a Reply to Defence and to Counter-Claim.

On 23rd July 2010 and 26th July 2010 the case was heard.

THE HEARING

The witnesses for the Plaintiffs were: (a) Mohammed Afzal Khan (b) Roshila Devi

The Defendant, Abdul Hamid gave evidence.

THE EVIDENCE

Evidence of Plaintiff – Mohammed Afzal Khan, sworn on Holy Koran in English – "last 5 years retired from business. Last business – land development and sales. Last 5 years not committed to any business. Children do business and I assist them. Have this action against Abdul Hamid. Know him for 30 years. Friends. Since I summon him to court, not good relationship. Claim for money.

In 2005 February Mr Hamid requested a loan to pay debt to Hardware Company- Ghulam Mohammed. $7500.00. a couple of months later he asked me to join him in business- chicken importation – in 2005. He invited me to his office and told me how he will import the chicken.

Business to import chicken to be conducted from Mr Hamids Ice Plant – Nakasi. We had long discussion. He requested me to put in the cash. My role was to inject cash. Injected $44849.42. 18/2/05 - $7500.00. Total advance - $52349.42. Business only for 4 weeks with Defendant. 2 weeks after start team of government representative- 1 from the abattoir, NRLA and Quarantine. Premises not in accordance with regulation. To upgrade as per regulation – halal. 14 days to comply. Gave notice to Defendant – 2 weeks. Premises was not upgraded. 2 weeks after notice Defendant called me and told me it was too costly to upgrade the premises as requested by Government.

He told me he will continue with fish and ice. He took responsibility of all stock and I will work for him on wages basis. Instructed Roshila for her to pay me $600 ($150 x 4). She paid me in cash. He took over the stock. I was there as a salesman and I controlled the stock and supervised the staff. At 5 pm – Roshila collected all the money from the till. No say in operation of business – only an employee. Mr Hamid promised me he will refund all the money – before business. He also promised me to refund me all monies. Trusted defendant knew him for 30 years.

Defendant kept all the money. I had nothing to do with that. Defendant paid me some money. All particulars written by Roshila. Roshila signed (Witness shown - Advance from Afzal Khan) for Nakasi Halal Meat. All Roshila's writing. [PE-1]. Over the page balance $21,718.00 worked for Defendant for 3 months then I went for religious mission. As at 22/01/07- $21718. Due to me as at today $15,000.00. 31/5/2006 letter written by Roshila on instruction of Defendant. As at 31/5/06 due $34246.97. I requested for the letter. For IRD. For my family record. [PE-2]. [PE-3 – Letter to CIR].

No discussion with Defendant on anything I owe to Defendant. Never discussed with me that I was to pay anything. 1st time after defences filed. No agreement with Defendant that I owe him. Seek defendant pay $15,000. Demand sent by lawyer. Defendant did not discuss with me about the demand. Defendant only called after writ was filed. Defendant gave me his commitment that he had done work for Fiji Muslim League. He will get the money in September 2009 – during Ramadan. I requested Defendant to accompany him to Ram Chands Office. [PE-4] Demand Notice.

Seek Defendant Pay $15,000.00. Seek defendant pay cost and solicitors cost, no interest, all limited to jurisdiction of this court."

Cross examination evidence – "went into a venture with defendant had couple of meetings. No record in writing between defendant. Business was registered separately but same premises as before was used. Used existing labour. Defendant asked me to inject the money. I was not interested in the business. Defendant gave me his words that he will refund the money. I gave Defendant a loan, I was an employee. Nothing on paper. I initially gave him $7500.00. He requested me to help him – helped him in good faith. We were signatories of the account. We made payments. I paid from the fund to telecom – Westpac Bank.

No agreement to share costs. [PE-2] – requested Defendant to give in writing how much he owed me. Wrote cheques from business cheque books. CIR never queried about the payments. I had no arrears with CIR. On daily basis held keys. I handed over sales to Roshila at 5pm. Business used to go upto 7pm.

[PE-1] verbal authority to pay with cheques. Agree with all payments signed for. [DE-1] -business was additional to Defendants other business. I never made my own decision. I went in to support Defendant.

Re-examination evidence "Defendant had other business all in operation from same office. Construction, plant hire with government, fish and ice this business was added to that. I did not join other business. Payment voucher of Hamid Construction. Is payment voucher for money refunded to me. Monies came from his business. He was paying from construction company.

The 2nd Plaintiff witness was Roshila Devi. Her evidence in chief was as follows: "working for Abdul Hamid for almost 18 years. I am the Secretary also handled money for Hamid's Construction and Hamids Ice – separate business. Has earthworks – comes under Hamids Construction. Control the finances – receive money and bank. Donot work in the weekend. Have responsible position.

I was not engaged in chicken business was for Nakasi Halal. New venture- dealt with chicken, fish and meat. Business conducted from one place. Know the Plaintiff through Hamid. I kept notes. Cash. I kept records. Nakasi Halal Meat income collected by the Plaintiff. Ice income by me. Down stairs business by Plaintiff. Plaintiff joined in October 2005. I donot know how they started the business. Know that plaintiff gave some money to start the business in October 2005. I donot know that business did not proceed due to problem with ministry of agriculture. Not sure how long business went on.

One $7500 was paid for GMR. Whatever we got was deposited in Plaintiffs account (Nakasi Halal Meat) after he left overseas. Plaintiff was with Defendant not sure how long. One container of chicken came from New Zealand. No other container. I am not sure if ministry of agriculture stopped them. Sale carried on. Business stopped sometime in 2006. Aware that business was stopped. They took away the meat. 24/11/2005 meat was sold after that.

Plaintiff was paid wages from Hamid's Ice income. $150 per week from ice income. Plaintiff was paid after few weeks not the 1st day. [witness shown PE-1] Mr Afzal Khan paid $7500 to GMR. For Defendants Debt. $52349.42 money advanced to the business. I paid wages. Plaintiff was an employee. Document was typed by Naaz. I had to sign the documents. Plaintiff was not in the office. Records were kept by Mr Khan. From the office records. Business started by Plaintiff and Defendant. Signature in [PE-1] is mine I forgot if I signed. Last transaction 9/1/2006. We have all the vouchers for payments made to Plaintiff. 9/1/2006 balance due to Plaintiff. [shown - PE-1] I am not sure if Defendant knew of the document. Defendant might know. [shown PE-2] all letters typed by Naaz. I approved what is typed. Defendant also approves them. Open letter. For monies owed by defendant- will be refunded. Was to be given to Inland Revenue. We gave a letter.

Joint venture business – Nakasi Halal Meat. Letter drafted by Plaintiff. We typed it like that. Some money paid out. The contents of letter were known to the Defendant. Letter contains facts. I signed the letter. Defendant authorised me to sign.

Cross examination evidence – "Nakasi Halal Meat joint venture between Plaintiff and Defendant. Looked after by Plaintiff. Mr Khan took money from the business. Mr Afzal Khan kept the keys and he opened and closed the office. Mr Khan did not give me money. Every afternoon I collected for ice. For Nakasi halal meat monies collected by Mr Khan.

[shown PE-1] is my signature. But cannot remember whether signed or not. Mr Khan prepared the account. We signed. All documents with Plaintiff. Saw Ministry of Agriculture letter when I photocopied. Chicken not confiscated. Chicken was sold. Mr Khan collected the money. Not really sure how long sale continued. Few weeks after set-up plaintiff was given wages from ice business. He was looking after ice business. He was not paid for Nakasi Halal Meat. Letter drafted by Mr Khan. Mr Khan told me he had some problems. The Plaintiff's version of the letter.

No written agreement for Nakasi Halal Meat. All verbal. Income account for sale of ice, meat, etc, expenditure. Is Mr Khan's writing. Plaintiff dealt with everything. Donot know how many containers came. Electricity supplied by Hamids Ice to Nakasi Halal Meat, water – Hamids Ice.

There was no re-examination. This was the Plaintiff's case.

The Defendants Case.

The Defendant in his evidence in chief stated: " 1st September 2005 went into business. Plaintiff and Wahid to get chicken from new zealand. [DE-2- company registration]. Plaintiff to put in money and share profit. Running cost was to be shared. 1st bill half paid (shared). Electricity bill is Hamid Ice. ½ paid by Afzal. All payments paid by Hamid. Was to 50/50. Partner never paid the expenses. [DE-3a – Bills]. [DE-3b- water bills to be equally shared].

Mr Afzal Khan wrote letters as Director of Nakasi Halal Meat. [DE-4 – letter dated 6/12/05]. everything was handed to Plaintiff. he handled everything. he was looking after Ice Business. $150/week paid to him. wages was for Ice Business. not for Nakasi Halal Meat. Quarantine – told me that I am not allowed to keep goat meat. Received letter from health department. Goat meat, goat head and beef meat taken. Chicken was retained. Plaintiff sold the chicken income went to the Plaintiff.

Shown [PE-2] – letter written as Plaintiff had sold property he needed a favour. We helped him with the letter. We gave it on our own letterhead. Mr Khan drafted. Fact that Plaintiff owed money to CIR. He injected money. Hamid Ice wrote to help Plaintiff – to assist him in tax.

Shown [PE-1] on 26/10/05 wrote a cheque to NZ Tute Ltd. Not a loan to me. He invested in the business. $7500 paid to GMR. Mr Khan gave me loan. Paid him every cent. He signed the voucher. Refer to payment voucher – [DE-1]. PE-1 - paid by Nakasi Halal meat. Export freight paid by Mr Khan. Money handled by Mr Khan. No account given to me of the sale of Nakasi Halal Meat.

Owes me electricity, rental, office, renovations and telecom. Plaintiff failed to pay expenditure. Plaintiff owes money to Nakasi halal and Hamids Ice."

Cross examination evidence – "very good friends with Plaintiff operate several business – construction, ice and fish and civil construction. Ice business-ground floor construction. 1st floor same premises. Plaintiff offered to open at same premises. I was a party to the business. I do not know where to get chicken from. In 2005 had some financial difficulties. Had difficulty paying bill loaned $7500 from Plaintiff.

Request from Plaintiff for meat business. They came to me and asked premises for business. We went into the business. Plaintiff wanted to inject the money. I gave him the business. Plaintiff injected $44849.42. $7500 loan to me. I deny that I was to reimburse the plaintiff. Business looked after by the Planitiff. When he was not there his sons handled the money. In weekends Roshila handled the income.

Was not told that operation was illegal. We never sold beef. Quarantine asked us to remove the goods. We did not stop sale of items. Agriculture took some stuff. Only 1 container came. Plaintiff handled income. Roshila has other jobs. She never worked for Nakasi Halal Meat. Plaintiff controlled the business, chicken sale went on for 3-4 months. Paid wages after couple of weeks - $150/week. Back dated wages from 1st day. Looked after ice income. Not paid for Nakasi Halal Meat. Plaintiff is not a partner in ice business. Wages paid for ice. Wages decided by both of us. Plaintiff looked after chicken business. Sale proceeds were kept by me. Plaintiff was employee of Hamid Ice Supplies.

Expenses agreement in office. Mr Wahid was paid commission $3000 gave cheque. Mr Khan banked. Cheques written jointly. Vouchers jointly. Income came cash banked by Plaintiff. I cannot say if things went through proper channel. Bills relate to my businesses. Major part is ice, fish and chicken. No written agreement on expenditure. 1st bill 50/50 paid. 50% paid by Hamid ice and 50% by Nakasi Halal Meat. Business stopped after sale of chicken. Plaintiff and I were good friends. 1st payment shared.

Shown [PE-2] aware of letter. Signed by Roshila for me. Know contents of letter. Letter faxed to Vijay at CIR. Hamid Ice is my company. Afzal wrote. I did not write. Aware of the contents of the letter. I agree with letter. Letter was made to save Plaintiff from CIR. Letter written to help Plaintiff he owed money to CIR- tax. Letter is a lie to save Plaintiff tax. I do not owe Plaintiff any money. Plaintiff never gave me the money. I agree it is an offence to give false letters. Already gone to CIR to save Mr Khan he owed CIR. Money is not owed by me was put in the business.

Shown PE-1 – Advance to Nakasi Halal meat. Income handled by Plaintiff. Was a Director. He did sales. I was not involved. Nakasi Halal meat owes Plaintiff. Whatever is in handwriting I do not agree. Type record from office. Fiji Muslim League still owes me money. I did not say to Plaintiff that I will pay him once I get the money. I did not say to Plaintiff that I will refund him the money. Did not use income in other business. Plaintiff held the income."

In re-examination – "wrote to assist the Plaintiff. Plaintiff owes me money."

ANALYSIS OF THE EVIDENCE

The Court noted the evidence that was given by the respective witnesses for the Plaintiff and the Defendant. The Court has also scrutinised the documents that were tendered as exhibits in this case.

The Plaintiff in the writ pleaded that "it was agreed between the parties that the Plaintiff injects cash money in the total sum of $52,349.42 which included an earlier loan of $7500.00 given by the Plaintiff to the Defendant" and "that it was agreed expressly between the parties that the total sum of $52,349.42 shall be treated as a loan given by the Plaintiff into the business and it was expressly agreed between them that in any event if the business flops the Defendant remains liable to pay back the said sum of $52,349.42 to the Plaintiff." The Plaintiff claims from the Defendant a sum of $15,000.00 being balance sum due to him.

The Defendant denied the Claim and Counter-Claimed a sum of $60,674.68 from the Plaintiff for electricity, rental, office renovation, telecom charges, water bills, vehicle usage, cool room usage, 3 phase power points and for cutting machines.

The Court noted from the evidences that no written agreement existed between the parties. The Plaintiff tendered in Court [PE-1] titled – Advance from Mr Afzal Khan for Nakasi Halal Meat, [PE-2] a letter dated 31st May 2006 on Hamids Ice and Fish Supplies Limited Letterhead, and [PE-3] – letter dated 31st May 2006 to Commissioner Inland Revenue.

The Court notes from [PE-3] which is a letter to CIR that there is reference to cash loan and cheques given to Abdul Hamid. [PE-1] is titled Advance from Mr Afzal Khan for Nakasi Halal Meat. The cheque details in [PE-1] and [PE-3] are similar. However, one is referred as loan to Hamid and other advance from Afzal Khan for Nakasi Halal Meat. One clear amount that is an addition in [PE-3] is a sum of $7500.00 which is not referred to in [PE-1]. [PE-3] is a letter written by the Plaintiff to The Commissioner for Inland Revenue with it is attached [PE-2] a letter signed for the Defendant.

The evidence of the Plaintiff and the Defendant are diametrically opposed to each other. The contention by the Plaintiff is that he invested in the business and the Defendant owes him money now that the business has ceased. The Court from the evidence before it finds that they both were Directors of Nakasi Halal Meat. The Plaintiff and the Defendant established Nakasi Halal Meat [DE-2]. The extract of Particulars furnished by Nakasi Halal Meat shows both the Plaintiff and the Defendant are Directors of the business. They both signed the cheques. The Plaintiff in [DE-4] – letter dated 6/12/2005 – also signed as Director.

The Court from the evidence notes that the Plaintiff and the Defendant set up a business as Nakasi Halal Meat and the Plaintiff advanced money to the business as per PE-1 titled Advance from Mr Afzal Khan for Nakasi Halal Meat. The Court finds that PE-2 was drafted by the Plaintiff and signed by Roshila for the Defendant to send to CIR with PE-3 and it shows that the Plaintiff advanced monies to the Defendant and not Nakasi Halal Meat. The two exhibits are clearly contradictory as one is an advance to Nakasi Halal Meat and the other shown as a loan to the Defendant. Both the Plaintiff and the Defendant were in business by setting up Nakasi Halal Meat and by signing the Cheques together. The letter [DE-4] also establishes that the Plaintiff was a Director and as he signed as one.

The Court is concerned with the use of various documents to send them to CIR and to portray one thing while another situation might exist. The Court agrees with the Defendant when he states that Nakasi Halal Meat owes the Plaintiff and not the Defendant. The Plaintiff advanced monies into the business and did not give it to the Defendant. He can claim from the business. From the evidence the Court can ascertain that the Plaintiff was heavily involved in the business. One other observation this Court makes is that poor record keeping and lack of accounting information of the business do not assist the parties and this Court.

For the forgoing reasons the Court dismisses the Plaintiffs claim.

As to the Defendants counter claim exceeds the jurisdiction of this Court and is struck out.

THE ORDERS

Plaintiff's Claim dismissed. Counter Claim Struck Out. 28 days to appeal.

Chaitanya Lakshman
Resident Magistrate

27/08/2010