In the High Court of Kiribati
Civil Jurisdiction
Held at Betio
Republic of Kiribati

Civil Case 50 of 2003

Between:

Development Bank of Kiribati
Plaintiff

And:

Tiri Matauea
Aneta Motee
Defendants

For the Plaintiff: Ms Batitea Tekanito
For the Defendants: Ms Taoing Taoaba

Date of Hearing: 28 April 2004

JUDGMENT

In February 1998 the first defendant (against whom the plaintiff already has judgment by default) secured a loan from the plaintiff for a trading store on Abaiang. I am not entirely clear as to the full amount of the loan: either $2,061 or $2,281. The loan was secured by guarantee given by the second defendant: it is dated 9th February 1998.

Some time later the borrower and the guarantor were in dispute. The guarantor wanted to be released from her guarantee. The two ladies had a meeting with the Bank. Nei Bereti Awira, in 1998 the Business Manager, spoke at the meeting for the Bank. According to Nei Aneta, Nei Bereti told her that she was released from the guarantee. Nei Bereti denied this, saying that the ladies were told Nei Aneta would only be released if another guarantor were found. Nei Bereti explained to the Court Bank policy. Not surprisingly the policy is that a guarantor will not be released until the full amount of a loan is repaid or another guarantor is found. Although vague as to what was said at the meeting, Nei Bereti asserted she would not have agreed to release Nei Aneta contrary to Bank policy.

Nei Aneta admitted she never received anything in writing to the effect that she had been released. Ms Taoaba tendered two letters which her client wrote to the Bank, the earlier dated 1st June 1998, the later 7th May 2002, both assuming the writer had been released. The Bank did not reply to either. As I pointed to Ms Taoaba during addresses the letters are self-serving: they do not prove the accuracy of their contents nor can the silence of the Bank be used to prove acceptance by the Bank of their accuracy.

Ms Taoaba had two hurdles to jump. The first a matter of law: as Ms Tekanito submitted, the written guarantee could only be cancelled by another instrument in writing and there is none. The second hurdle a matter of evidence: on the balance of probabilities I accept Nei Bereti's denial that she told the ladies that Nei Aneta was released. Ms Taoaba fell at both hurdles.

There will be judgment for the plaintiff against the second defendant but for what amount? The sum of $6,158.54 is claimed in the Statement of Claim annexed to the Writ dated 7th July 2003, with interest at 12% (the rate agreed in the loan agreement). In contrast the copy of the Statement of Account tendered in evidence, shews $6,518.54 owing to the 1st May 2003. In the early days some repayments were made. I shall have to hear parties as to the proper judgment sum.

Dated the 29th day of April 2004

THE HON ROBIN MILLHOUSE QC
Chief Justice