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Magistrates Court of Fiji |
IN THE FIRST CLASS MAGISTRATE'S COURT
WESTERN DIVISON AT NADI
NADI CIVIL ACTION NO. 569 OF 2010
BETWEEN:
PACIFIC SHORES LIMITED
duly incorporated limited liability company having its registered office in Nadi and formerly trading under the name and style of
TAMBUA SANDS.
PLAINTIFF
AND:
NATIVE LAND TRUST BORAD
a body corporate duly constituted under the Native Land Trust Act Cap 134.
DEFENDANT
JUDGMENT
[1] Plaintiff brought this action against the Defendant for the refund of the sum of $20,000.00 plus interest at the rate of 9.99% from 4th July, 2010 to the date of payment but limited to the jurisdiction of this court and costs.
[2] The Plaintiff in the Statement of Claim states that:
(1) the Plaintiff is a duly incorporated limited liability company having its registered office in Nadi and was at all material times trading under the name and style of Tambua Sands.
(2) the Plaintiff was the registered lessee of all that piece and parcel of land comprised in Native Lease No. 15573 known as Nasausau Raramakava being Lots 1 and 2 on Plan No. 1825 in the Tikina of Baravi in the Province of Nadroga/Navosa having an area of 17 acres 2 roods and 15 perches (hereinafter referred to as "the Land").
(3) The Defendant is vested with the control and administration of the Land.
(4) The leasehold interest in the said Native Lease No. 15573 was assigned by the Defendant to the Plaintiff on or about July 2001.
(5) On or about the 21st day of January 2009 the Defendant gave notice to the Plaintiff to pay the Defendant the sum of forty five thousand three hundred and twenty eight dollars and twelve cents ($45,328.12) being for rental arrears.
(6) on or about the 5th day of May 2010 the Plaintiff entered into a Sale and Purchase Agreement with a Silver Autumn Beach Villa Limited (hereinafter referred to as the "Purchaser"), subject to the Defendant's consent, for the sale of the assets of the Plaintiff including the leasehold interests in the Land.
(7) Pursuant to clause (ii) of the said Native Lease No. 15573 the Plaintiff was required to obtain the Defendant's consent for the Plaintiff to assign or otherwise enter into any dealing whatsoever concerning the said Native Lease.
(8) By its letter dated the 7th day of May 2010 the Plaintiff, by its solicitors, offered to pay the Defendant settlement with the Purchaser the money owed by the Plaintiff to the Defendant as rental arrears and requested for the Defendant's consent to the transaction.
(9) On or about the 11th day of May 2010 the Defendant, for the first time since the said Native Lease was assigned to the Plaintiff, demanded that the Plaintiff pay such additional sum of money as assessed by the Defendant as compensation for purported breach of the Native Lease.
(10) on or about the 2nd day of June 2010 the Defendant, in addition to demanding for the said arrears of rental, demanded the Plaintiff to pay a further sum of twenty thousand dollars ($20,000.00) as compensation for the alleged breach of clause 3 (xvi) of the said Native Lease.
(11) pursuant to clause 3 (xvi) of the said Native Lease "the lessee will use its best endeavors to promote the training of members of the Mataqali Bucona, who are employed by the Lessee, in all aspects of hotel management and administration and other types of skilled work in connection with the hotel resort and its ancillary operations as the lessee shall consider them suitable or qualifies to undertake".
(12) The said sum of twenty thousand dollars ($20,000.00) demanded by the Defendant from the Plaintiff as compensation payable by the Plaintiff to the Defendant was wrongly, arbitrarily and capriciously Defendant.
(13) Despite the Plaintiff's protests the Defendant refused to give its consent to the Sale of the Land unless the Plaintiff agreed to pay for the rental arrears as well as the said compensation sum claimed by the Defendant.
(14) The Plaintiff was in a very difficult financial position and the Defendant was fully aware that the Plaintiff required the said sale to the Purchaser to be completed.
(15) under the compulsion to obtain consent of the Defendant to secure the Sale of the Property the Plaintiff negotiated an interim arrangement with the Defendant, inter alia, to pay the Defendant the sum of twenty thousand ($20,000.00) under protest and for the Defendant to reassess its position after receiving all the relevant documents form the Plaintiff.
(16) By its letter dated the 13th day of September 2010 the Defendant refused to refund the Plaintiff the said sum of twenty thousand ($20,000.00) or any part thereof.
(17) In breach of the above agreement the Defendant has either failed and/or neglected to carry out a reassessment of the compensation sum to date.
(18) Despite several requests made by the Plaintiff the Defendant has wrongfully retained and has failed to reimburse the Plaintiff the said sum of twenty thousand dollars ($20,000.00).
(19) The Plaintiff claims the sum of twenty thousand dollars ($20,000.00) as monies had and received by the Defendant.
(20) The Defendant knew or ought to have known that the Plaintiff was a business entity who would utilize the monies it had in its business.
[3] The Defendant filed Statement of Defence and stated that:
[4] The Defendant prayed that the Plaintiff's claim be dismissed as frivolous and vexatious 'with costs
AGREED FACTS
[5] The agreed facts may be summarized as follows:-
SUBMISSIONS ON LAW
[6] The Plaintiff filed written submissions and submitted as follows:-
Statement of Defence
Order XVI Rule 3 (a) of the Magistrates Court Rules requires every pleading to contain a statement of all the material facts on which the party pleading relies. The Defendant's Statement of Defence does not disclose any facts at all. It contains bare denials of the allegations contained in paragraph 9 and 12-22 of the Statement of Claim.
Order XVI Rule 3(e) states that:
"The defendant's pleadings shall deny all such material allegations in the statement of claim as the defendant intends to deny at the hearing. Every allegation of fact, if not denied specifically or by necessary implication or stated to be admitted, shall be taken to as established at the hearing".
That pursuant to the above Orders in this case since the Statement of Defence only contains bare denials. the Plaintiff did not need to prove any facts alleged in the Statement of Claim as they are taken to be established in this case.
Lease conditions
Clause 3 (xvi) of the lease gives the Plaintiff as the lessee to "use its best endeavors" in providing the training to mataqali Bocona. It lessee is given the total discretion to determine what it considers as suitable training for the employees to undertake. This clause does not impose any obligations on the part of the lessee to provide any particular mode of training as required by the Defendant.
In any event the Defendant did not even inquire about the training provided by the Plaintiff.
Clause 6 (11) on page 6 of the Lease deals with the issue of breach of the lease on the part of the lessee. It requires the Lessor to allow the lessee the right to remedy the breach. In this case the Defendant did not even raise the issue of a breach on the part of the Plaintiff throughout the nine (9) years of the lease.
Money had and received
A claim for money had and received lies where the Defendant has received money of the Claimant under such circumstances that he is obliged by the ties of natural justice and equity to refund it. The law previously regarded the Defendant as having received to the use of the Claimant and implied a promise on his part to pay it to the claimant. The action was, therefore, in principle one which rested on the promise to pay, either actual or imputed by law (see Moses vs Macferian [1760] EngR 713; [1558-1774] All ER Rep 581. It is now viewed as a restitutionary claim based on unjust enrichment.
"A man pays money which he is not bound to pay, under the compulsion of urgent and pressing necessity or actual or threatened seizure of goods, he may recover the money as money had and received" Maskell v Homer [1915] 3 KB 106, [1914-15] All ER Rep 595, CA.
The payment by the Plaintiff to the Defendant was under protest. The Defendant therefore held the sum of $20,000.00 on trust for both the Plaintiff and the Defendant. It obtained the money under compulsion. The Defendant refused to grant its consent unless the Plaintiff paid the $20,000.00 it demanded from the Plaintiff. It therefore ought to return the money to the Plaintiff.
The Defendant has wrongfully retained the money after it promised to reassess the evidence provided by the plaintiff to the Defendant in respect of the training the Plaintiff provided to the said mataqali members.
Contract
Section 105 of the Property Law Act requires the Lessor of a property to serve on the lessee a notice specifying the breach and if the breach is capable of being remedied then require the lessee to remedy the breach. The issue of compensation only arises if after a reasonable time the lessee fails to remedy the breach.
In the present case throughout the duration of the nine years that the Plaintiff leased the property in issue the Defendant never alleged that the Plaintiff breached the lease condition in issue in this case. This Defendant did not even give the Plaintiff an opportunity to remedy the alleged breach (if any). It alleged that it made its finding without even consulting the Plaintiff and determined the compensation payable by the Plaintiff.
The Defendants actions in demanding for compensation were arbitrary, wrong and unlawfully.
DEFENDANT'S SUBMISSION
[7] On the other hand the Defendant also filed written submissions and submitted that the Plaintiff's claim be dismissed as the Board (Defendant) is statutorily empowered to impose lease conditions as well charge penalty fees for breaches of the said lease conditions and it also has the power and discretion to impose penalty in that regard.
PLAINTIFF'S EVIDENCE
[8] at trial, Mr. Richard Norby, Director of the Plaintiff Company gave evidence for the plaintiff. He in examination in chief stated that the Plaintiff was the registered lessee of the Native Lease No.15573. The Plaintiff applied for the Defendant's consent to assignment of the lease when the Plaintiff entered into an agreement to sell its property including the lease to a third party. When the Plaintiff applied for the consent the Defendant demanded the sum of $20,000.00 as compensation for alleged breach of the lease-clause 3 (xvi) of the lease. He also told that the Plaintiff provided training to all its employees at FNTC and also provided in house training to members of Mataqali Bocona who were employed by the Plaintiff. The plaintiff provided evidence of the training it provided to the Defendant.
He further stated that despite the Plaintiff's objection the Defendant insisted that Plaintiff pay compensation in the sum of $20,000.00 to get the consent for the assignment of the lease to a third party. He said that the Plaintiff paid the sum of $20,000.00 to the Defendant under protest on the express condition that the Defendant grant consent for the assignment of the lease and the Defendant reassesses the amount of compensation after the Plaintiff provided the evidence of the training. Mr. Richard Derby told that the Defendant never reviewed the compensation though the Plaintiff provided evidence of the training.
[9] Under Cross Examination Mr. Richard Derby he confirmed payment of $20,000.00. When asked that's for breach of lease he said that's what they said. He admitted that he said that he will provide records of training. He also said that the lease does not say what kind of training. He denied the suggestion that he did not provide any proof that's why NLTB asked $20,000.00 as compensation.
[10] In Re-Examination the Plaintiff's witness stated that NLTB did not ask any certificate or receipt. He informed the training took place and he did not have any receipt.
[11] The Plaintiff also marked and tendered a bundle of document without objection which included Exh-1-Exh-17.
DEFENDANT'S EVIDENCE
[12] At trial, the Defendant called Mr. Peniqalo, Estate Officer to give evidence for the Defendant.
[13] Mr. Peniqalo in Examination in chief stated that they checked if the condition of the lease is complied with and they also checked the lessee is paying rental every six month. He also stated that he is in court to give evidence regarding compensation of $20,000.00 for breach of lease agreement, clause 3.
[14] Under Cross Examination this witness said 'no' when asked he wrote any letter of the Plaintiff. He also said that he could not remember whether he had any communication with the Plaintiff.
[15] The Defendant's witness was not Re-Examined.
DETERMINATION
[16] The issue before court for determination is whether the Plaintiff is entitled to recover the sum of $20,000.00 paid under protest to the Defendant in order to get their consent for the assignment of the lease to a third party.
[17] The Plaintiff said that he paid this money when the Defendant demanded in order to grant consent for the assignment of the lease. The Plaintiff also said that the Defendant demanded this payment for breach of the lease-clause 3 (xvi).
[18] Further the Plaintiff said that he paid the said money under protest on the express condition that the Defendant grant consent for the assignment of the lease and the Defendant reassesses the amount of compensation after the Plaintiff provided the evidence of the training.
[19] The Defendant filed its Statement of Defence on 4 December 2010 wherein no defence has been formulated the Defendant. The Statement of Defence does not disclose any facts at all. In paragraph 5 of the Statement of Claim the Defendant states as follows:
"The Board denies all the contents pleaded in Paragraphs 9 and 11-22 of the Statement of Claim and the Plaintiff is put to strict proof of on all allegations raised therein".
[20] The Defendant now in its written submissions sated that the Defendant has power to impose any lease conditions and impose a penal rent in respect of such breach. The Defendant in the written submissions says the sum of $20,000.00 was recovered as a penalty for breach of the lease condition under clause 3 (xvi). To my surprise, these facts were not pleaded in the Statement of Defence.
[21] The Plaintiff in evidence told that the Defendant never informed him about any breach of condition of lease during the 9 years period he held lease under the Defendant. It was only when the Plaintiff sought consent for the assignment of the lease to a third party, the Defendant demanded $20,000.00 as compensation for breach of the lease condition.
[22] If there were any breach of the lease conditions on the part of the Plaintiff, the Defendant should have informed and afforded an opportunity to the Plaintiff to explain the alleged breach. This was not done by the Defendant.
[23] It is true that the Defendant may impose lease condition and penalty for breach of any such condition in terms of section 4 of the Native Land (Leases & Licenses) Regulation, Legal Notice No 98 of 1984. However this power must be exercised fairly. No notice of breach of the lease condition was given to the Plaintiff by the Defendant.
[24] The Plaintiff stated that he provided all the evidence regarding the training but the Defendant failed to review the payment of compensation till today.
[25] It was not a disputed fact that the Defendant received the sum of $20,000.00 from the Plaintiff. This not denied by the Defendant in the Statement of Defence. Now the Defendant cannot ask for a receipt in proof of the payment.
[26] The Defendant did not adduce any evidence, documentary or otherwise, to establish the alleged breach of the lease condition by the Plaintiff.
[27] In the circumstances hold that the Defendant had recovered the sum of $20,000.00 from the Plaintiff without any legal justification hence the Plaintiff is entitled to refund of it on the basis of money had and received.
[28] The Plaintiff seeks interest at the rate of 9.99% per annum from 4th July 2010 till the date of payment. He said that he had to get overdraft facility and paid interest at 9.99%. Therefore hold the Plaintiff also entitled to the interest at the rate of 9.99% from 4th July 2010 till the date of payment.
[29] As a winning party the Plaintiff entitled to cost. The Plaintiff seeks $5000.00 as cost. The Plaintiff receives interest of the sum he claimed. I therefore assess the cost summarily at $1800.00.
ORDERS
[30] a) There will be judgment for the Plaintiff in the sum of $20,000.00.
b) The Plaintiff is entitled interest at the rate of 9.99% per annum from 4th of July 2010 till the date of payment.
c) The Plaintiff is entitled to costs in the sum of $1800.00 which is summarily assessed.
M H Mohamed Ajmeer
Resident Magistrate
18.10.2011
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URL: http://www.paclii.org/fj/cases/FJMC/2011/120.html