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Hirano v Harcourts Real Estate [2020] FJMC 11; Civil Miscellaneous Case 13 of 2018 (29 January 2020)

IN THE MAGISTRATE’S COURT OF FIJI
CIVIL JURISDICTION
WESTERN DIVISION AT LAUTOKA

Civil Miscellaneous Case No. 13 of 2018

[In the Matter of a transfer from
the Lautoka Small Claims
Tribunal Case No. 374 of 2018]

BETWEEN : Ryota Hirano of 11 Salala Place, Lautoka.
Claimant

AND : Harcourts Real Estate of Lautoka.
Respondent

Before: Resident Magistrate – Mr. Jeremaia N. Lewaravu

Hearing – 4^th December, 2019

Judgement – 29^th January, 2020

Appearance
Ms. Naidu for the Applicant
Mr. Koroi and Mr. Shah for the Respondent

Preliminary Ruling

Introduction

1. On the 19^th of March, 2018, the Claimant filed his original application in the Small Claims Tribunal at Lautoka seeking to recover his Bond and Rent in the sum of $2,550.00 The Respondent opposed the application and filed his Defence. On the 13^th of July, 2018, this matter was listed for Hearing at the Small Claims Tribunal.
   
2. At the conclusion of the Hearing, the Learned Tribunal issued an Order whereby the matter was transferred to this Court under section 22 (2) of the Small Claims Decree. The matter was listed for Hearing in this Court on the 4^th of December, 2019.
   

The Preliminary Issue

3. On the day of Hearing, the Respondent raised a preliminary issue for determination. Essentially, the Respondent submits that upon receipt of the Bond and first month’s rent from the Applicant, the Respondent’s duties under the Agency Agreement signed with the Landlord (Mr. Mukesh Chand) was fulfilled. The Agency in effect has ceased to exist. The Respondent has submitted a copy of the Agency Agreement. He is specifically relying on Clause 1, 2, 3 and Clause 4 of the same. The Respondent further submits that the Bond and first month’s rent have since been forwarded to the Landlord (Mr. Mukesh Chand). On that basis, the Respondent submits that the Applicant has sued the wrong party.
   
4. The Respondent submits that it is only the Real Estate Agent for the Landlord (Mr. Mukesh Chand). There is no contractual agreement between the parties therefore there is no legal and/or contractual obligation between the same. The only connection between the parties is that the Respondent was an Agent for the Landlord and witness to the Tenancy Agreement signed between the Applicant and the Landlord (Mr. Mukesh Chand). The Respondent submits that it would be unfair and prejudicial should the relief sought is granted as the said amount is owed to the Landlord and that the Respondent was authorised to collect it. The Respondent submits that the reference made to the lack of Bank Account details of the Landlord is immaterial given that the Applicant failed to make any subsequent rent payments.
   
5. The Respondent submits that the application by the Applicant is an abuse of the Court process. The Applicant had initially filed a case in the Small Claims Tribunal that was dismissed on the ground that the Applicant had sued the wrong party. He then filed this relevant case involving the same parties over the same issue that has since been transferred to this Court. The Respondent submits that it is an abuse of the Court process for a suitor to relitigate a legal issue by the same parties that has already been determined by a Court of Law even though it is not strictly re judicata. He has submitted relevant case of Palas Auto Services Ltd v Handymans Ltd [2012] FJHC 1112 to support his proposition.
   
6. The Respondent further submits that section 16(1), (c) of the Magistrates Court Rules is applicable herein. The Respondent is relying on the case of Chandar v Chand [2019] FJHC 956 where the Court ruled that there must a tenancy and landlord agreement to bring a claim in the Magistrates Court for the recovery of rent. However, in the matter herein, the Respondent submits that there is no tenancy agreement between the parties. The Respondent submits that in light of the principle adopted in Chandar v Chand (supra), the Applicant cannot sue the Respondent herein. On this basis, the Respondent is seeking that the matter be struck out and/or dismissed.
   
7. The Applicant is opposing the preliminary issue raised.
   
8. The Applicant submits that the Respondent and the Respondent Company was acting as an agent for the Landlord (Mr. Mukesh Chand) at all material times. The Applicant submits that he was introduced to the said property and the Landlord (Mr. Mukesh Chand) by the Respondent through the Respondent Company. The Plaintiff further submit that when the Tenancy Agreement was signed on the 31^st of December, 2016, only him and the Respondent were present as the Landlord (Mr. Mukesh Chand) had already signed at an earlier date and a copy was faxed to the parties.
   
9. The Applicant submits that upon signing the Tenancy Agreement, he was instructed by the Respondent to pay the Bond and the first month’s rent to the Bank Account of Blue Water Real Estate of the Respondent Company. The Applicant in compliance deposited the sum of $2,400.00 into the ANZ Account Number: 7397929 belonging to the Respondent Company under Blue Water Real Estate on the 31^st of January, 2017. A receipt by the Respondent Company was issued to the Applicant. The Applicant and his wife entered into occupation soon after.
   
10. During the first few days of occupation, the Applicant found a number of defects in the property. He informed the Respondent of the same who in turn contacted the Landlord. Despite having notice of the defects, no one came to deal with the complaint. The Applicant was compelled to leave the property the same week and requested for a refund from the Respondent and to return the house keys.
    
11. The Applicant submits that at that point, the Respondent refuse to refund the money and/or to receive the house keys on the basis that its responsibilities has ceased upon occupation by the Applicant. The Respondent then nominated itself to be a mediator between the Applicant and the Landlord. Despite contacting the Landlord, nothing was done regarding the complaints.
    
12. The Applicant submits that it was only dealing with the Respondent who was an agent for the Landlord. The bond and first month’s rent was paid to the Respondent and not the Landlord. The Tenancy Agreement states that the Applicant could pay either the Landlord or the Respondent the monthly rent. The Applicant submits that he was not provided any Bank details of the Landlord nor was he given strict instructions as to payment of rent and therefore assumed that he would only pay rent to the Respondent given that the Landlord (Mr. Mukesh Chand) resides overseas. The Applicant further submits that the Agency Agreement between the Respondent and the Landlord lacks an expiry date. On that basis, the Respondent still acts as an agent of the Landlord and therefore owes a duty of care to the Applicant to act fairly and in the interest of his fiduciary. The Applicant has cited a relevant case authority to support his submissions.
    
13. The Applicant submits that he only dealt with the Respondent and the Respondent Company at all times. He is therefore suing the correct party. He prays that the preliminary issue raised be dismissed and the matter adjourned to a date for Hearing.
    

Legal Matrix

14. I have heard the parties and considered the documents adduced in light of the preliminary issue raised.
    
15. I will start with the glaring omission in the Agency Agreement of any signature by any representative of the Respondent Company. The issue raised was not a point of contention for either party, I will therefore let the matter rest.
    
16. I will now deal with the issue of expiration of the Agency Agreement. I refer to paragraph 5 of the same that provides:
    

‘This authority may terminated by either party on one month’s notice in writing’.

17. I have perused all the documents filed herein. I must say that I have yet to see any termination notice by either the Respondent or the Landlord (Mr. Mukesh Chand) to confirm expiration of the Agency Agreement. In light of this omission, I cannot accept the submissions by the Respondent that his Agency had ceased upon the Applicant entering the said premises in occupation. Secondly, as noted by both parties, the Agency Agreement does not provide any Banking details of the Landlord. This omission when read together with the Tenancy Agreement in particular paragraph 2(a), one can conclude that payment of monthly rent was to be made to the Respondent’s Bank Account given the residency status of the Landlord (Mr. Mukesh Chand). In light of the foregoing, I hold that the Applicant is suing the proper and correct party.
    
18. I also note that in the first case filed by the Applicant. The issue of whether the Respondent was the correct and proper party was not fully ventilated at a Hearing. Furthermore, the Learned Tribunal failed to consider applying section 19(2) of the Decree by joining the Landlord as a party. He has instead struck the matter out in breach of section 24 relating to a right of audience. In light of the foregoing, I hold that the claim by the Respondent of abuse of Court process by the Applicant has no merit.
    
19. Finally, I have already made a finding that without a termination notice, the Respondent has remained as an agent of the Landlord (Mr. Mukesh Chand). In that regard, section 16(1), (c) of the Magistrates Court Rules is applicable herein.
    
20. The full orders of the Court is as follows:
    
    1. The preliminary issue raised by the Respondent is hereby dismissed.
       
    2. The Respondent is hereby ordered to pay the Appellant legal cost in the sum of $200.00 to be paid within 21 days.
       
    100. Appeal within 28 days.
         
    4. The matter is hereby listed for Hearing on the 3^rd of March, 2020.
       

Ordered Accordingly,

....................................................
Jeremaia N. Lewaravu
RESIDENT MAGISTRATE

29^th of January, 2020