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Hershey v Muller [2013] FJMC 88; Nadi Civil Action 543.2010 (19 February 2013)

IN THE RESIDENT MAGISTRATE'S COURT
WESTERN DIVISON AT NADI
[CIVIL JURISDICTION]


Nadi Civil Action No. 543 of 2010


BETWEEN


: JASON HERSHEY of Butaweng, Papua New Guinea, Businessman.
PLAINTIFF


AND :


IAN ROVOU VOU MULLER Martintar, P. O. Box 9792, Nadi Airport, Nadi, Businessman.
DEFENDANT


JUDGMENT


  1. This is an action instituted by the Plaintiff claiming special damages in the sum of $40,330.00, general damages and cost against the Defendant for the breach of agreement.
  2. The Defendant filed a Statement of Defence and Counter-claim in person and sought dismissal of the Plaintiff's action and also claimed special and general damages suffered by the Company due to the Plaintiff's actions and cost of this action.
  3. In Reply to Defence and Defence to Counter Claim the Plaintiff prayed that the Defendant's Statement of Defence and Counter Claim be struck out as same is baseless, scandalous and vexatious.
  4. The facts of the case may summarized as follows:-
  5. It is alleged that the Defendant is in breach of contract as he has failed to perform his obligations pursuant to the said MoU. In that:
  6. It is also alleged by the Plaintiff that the conditions of the said MoU not having been carried out and approval of the Director of Lands not having been obtained, the Plaintiff requested of the Defendant for refund and repayment of the monies paid over by the Plaintiff. The Defendant asked for further time to refund the Plaintiff's monies despite being given further time to do so.
  7. The issue that is left for the court to decide is that whether the Plaintiff is entitled to return of the monies he paid over to the Defendant as a result of the breach of performance of the said MoU on the part of the Defendant.
  8. At trial, the Plaintiff gave oral evidence on his behalf. There were no other witnesses. The Plaintiff identified the following documents and tendered into evidence:
  9. The Plaintiff gave evidence and stated that he and the Defendant entered into an agreement (P1), and that under the terms of the said MoU, he was to pay the sum of $60,000.00 in instalments to the Defendant, and the Defendant was to purchase Crown Lease No. 227713 and give a one acre share in the said Crown Lease to him. The Plaintiff also told that he was also to acquire a 10% share of the business known as Fijian Surf Company Limited.
  10. The Plaintiff said he had been in Fiji in February, 2009, he had entered into this agreement with the Defendant at a solicitor's office, and he had then gone to Hawaii where he was living at that time. He further said that he made two payments (P2 & P3) to the Defendant totalling FJD$42,062.90. These payments were acknowledged by the Defendant (P4).
  11. The Plaintiff said that he returned to Fiji to attend to the Defendant's wedding and after the wedding he was a guest in the Defendant's home for a few months. He worked unpaid for the Defendant's Company. During that time he saw how the Defendant's Company was run. He said the accounting for the customers at the office was not matching the number of people he saw on the surf boat. He said the Land purchase was not happing and he was not getting any percentage of the business as a shareholder. He then went back to Hawaii. He did pay the third instalment under the said MoU.
  12. Under cross examination the Plaintiff stated that he never once missed work denying the allegation that he was partying all night instead of working for the Surf Tour. He admitted that the parties had agreed to look for other land but said that was long after the MoU. He admitted a very old criminal conviction in America. The Plaintiff also stated that he had asked to use a vehicle, and that the Defendant told him to get his own vehicle. He said that when he came back to Fiji he found that the Defendant had bought a van.
  13. The Defendant gave oral evidence for him. He did not adduce any documents into evidence at trial.
  14. The Defendant in evidence stated that the Plaintiff had invested in the business, lived in his home, ate his food, used his phones and made a music video.
  15. In Cross Examination the Defendant admitted that he had provided these things free of charge to the Plaintiff he had a change of heart later on and stated that he had so because he believed the Plaintiff to be a genuine investor and now he wanted to be paid as he feels the plaintiff has used him. The Defendant also confirmed that the van was bought at a time when the Plaintiff wasn't in Fiji, that van was held in the Company's name and the Company used the van for its business. He claimed that he had witnesses and documents to prove what he was saying.
  16. The Plaintiff seek recovery of the monies, being the sum of $42,062.90 he paid to the Defendant in view of the terms of the MOU (P1) entered into between the Plaintiff and the Defendant on 13 February 2009.
  17. Pursuant to the MOU the Plaintiff was to pay the sum of $60,000.00 in instalments. The Plaintiff made payments in two instalments totalling $42,062.90, this being substantial partial payments on the part of the Plaintiff. The Defendant has admitted receiving these monies from the Plaintiff.
  18. The MOU called for the Plaintiff to receive a one acre land from Crown Lease No. 227713, which the Defendant agreed to purchase and ten per cent (10%) of the shares of the Defendant Company, Fiji Surf Company Limited.
  19. Paragraphs 2 and 3 of the MOU state as follows:

"2. This MoU makes reference to sale and purchase agreement between Abdul Imazid aka Chizag s/o Din Mohammed of back road, Nadi as vendor and Ian Rovouvou of Martintar, Nadi as purchaser.


3. Ian Rovouvou Muller will purchase Crown Lease Number 227713 being land known as Nacobi Subdivision Lot 66 on Plan No. ND 3940 in the province of Ba and Tikina of Nadi comprising an area of 2.0284 ha (hereinafter "the said land") of which Abdul Imazdi Chizag is currently the registered lessee."


  1. After receiving monies from the Plaintiff, the Defendant failed to fulfil his obligations under the MoU. The defendant did not purchase the land and transfer a one acre of the land to the Plaintiff nor did he transfer 10% shares of the Defendant's Company.
  2. The Defendant did not take real efforts either to acquire the Crown Land or to transfer the 10% of the shares of his Company as agreed under MoU.
  3. The Defendant said in evidence that he could not get the required consent of the Director of Lands as the Plaintiff did not provide his police clearance. It is to be noted that police clearance for transfer of shares or for seeking consent of the Lands Department to transfer Crown Lease to the Plaintiff for applying for Foreign Investment Certificate has not been a legal requirement.
  4. There has been nothing in court to show that the Defendant ever required police clearance from the Plaintiff for these purposes.
  5. In Cross Examination the Defendant admitted that he purchased a van using the monies the Plaintiff sent to him for his Company.
  6. Paragraph 11 of the MoU (P1) provides that:

"If for some reason the conditions of this agreement are not carried out and/or statutory approvals are not obtained or refused, Jason Hershey will be entitled to a complete refund of all monies paid in the execution and performance of this agreement."


  1. I note that the Defendant has failed and/or neglected to carry out the conditions of the agreement hence the Plaintiff is entitled to complete refund of all monies paid in the execution and performance of the agreement pursuant to paragraph 11 of the MoU.
  2. The Plaintiff requested the Defendant for the refund of the monies he paid under the MoU. However, the Defendant had refused to return the monies he deposited. The Defendant also failed to respond to the Demand Notice sent by the solicitors of the Plaintiff.
  3. After failing to carry out the conditions of the agreement, the Defendant has no legal right to retain the Plaintiff's monies deposited in compliance with the terms of agreement. If the Defendant allowed to retain that money, that would amount to unjust enrichment.
  4. The Defendant was given 14 days to file his written submissions. Instead, he filed a Notice of Motion seeking orders, inter alia, that Messrs. M. K. Sahu Khan & Co disqualify itself from acting and or cease acting against Ian Rovouvou Muller the Defendant in the action herein and seeking leave to call Mr. Azeem Sahu Khan of Messrs. M. K. Sahu Khan & Co to adduce further evidence. This Notice of Motion has been dealt with in my separate ruling.
  5. The Defendant after giving evidence said that he is not calling any witness to give evidence on his behalf. After close of the Defence case, the Defendant is not entitled to call any witness to adduce evidence for him.
  6. I therefore decide that the Plaintiff is entitled to the return of the monies he paid to the Defendant, being FJD$40.000.00 (as claimed in the Statement of Claim) pursuant to the MoU since the Defendant failed to carry out the conditions of the agreement as stated above.
  7. I also allow special damages in the sum of $330.00, the solicitor's costs for the Demand Notice (P5) served on the Defendant.
  8. As a winning party the Plaintiff is entitled to cost of this action. The Plaintiff seeking cost in the sum of $4,000.00 plus VAT, for a total of $4,500.00, representing the solicitor's costs actually paid by the Plaintiff in respect of this legal action. The Plaintiff also claimed the cost of his return airfare to Fiji to attend this trial of approximately FJD$2,000.00. The Plaintiff is not entitled to claim the cost of the return airfare, because he is not a witness in this case. He is a party to this action. He must attend to the court for trial. I am not allowing the Plaintiff's return airfare to Fiji to attend this trial. I therefore, considering all, order that the Plaintiff is entitled to cost in the sum of $3,500.00 which is summarily assessed.
  9. I now turn to the issue of counter-claim. The Defendant claimed in the sum of $18,000.00 as counter-claim from the Plaintiff for using his shares while he was living in Fiji on a few occasions for his accommodation, food, telephone bills (local/international), storage of personal effects, personal use of vehicles, skis and boat surf trips, the Defendant also claimed further sum of $16,000.00 as the monies spent for the Plaintiff's music video.
  10. In the Statement of Defence and Counter Claim (paragraph 3 of Counter Claim) stated that calculation proof will follow. Nonetheless, the Defendant produced no proof to establish the counter claim. It is a common ground that the Plaintiff worked unpaid for the Defendant's Company. The Plaintiff came to Fiji to attend the Defendant's wedding upon his invitation. There was no agreement by the Plaintiff to pay room and board.
  11. The Defendant did not establish the counter claim against the Plaintiff hence I struck out and dismiss the Defendant's Counter Claim.
  12. In conclusion, there will be judgment in favour of the Plaintiff in the sum of $40,330.00. The Defendant shall pay cost of this action to the Plaintiff in the sum of $3,500.00 which is summarily assessed. The Counter Claim of the Defendant is struck out and dismissed.
  13. Orders accordingly.

M H Mohamed Ajmeer
Resident Magistrate


19.02.2013


Messrs. M. K. Sahu Khan & Co. Solicitors for the Plaintiff
Messrs. Rams Law, solicitors for the Defendant.


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