HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 218 of 1998

SOLOMON ISLANDS BROADCASTING CORPORATION

–v-

MARK BISILI

High Court of Solomon Islands
(F.O. KABUI), J.)

Date of Hearing: 14th February 2000
Date of Judgment: 18th February 2000

Mr A. Radclyffe for the Plaintiff
Defendant in person

JUDGMENT

(Kabui, J): In its Statement of Claim filed on 18th November 1998, the Plaintiff claimed against the Defendant the following relief –

(a)	Damages for trespass;
(b)	Possession of the premises;
(c)	Mesne profits at the rate of $2,500 per month from 1st June 1998 until possession is obtained.
(d)	Interest;
(e)	Costs.

The Writ of Summons was filed the same date as the Statement of Claim. The Defendant in response to the Plaintiff’s Statement of Claim, denied wrongful occupation of the Defendant’s premises and that he deprived the Defendant the use of the said premises and from any income from renting the premises from 1st June 1998 and onwards. The Defendant also denied that the Plaintiff was entitled to the relief set out in (a) to (e) above. On 11th August 1999, the Defendant filed a counter-claim against the Plaintiff for specific performance, damages for breach of contract, (in the alternative), further relief, interest and costs.

The Facts

The Defendant had been an employee of the Plaintiff under contract. The contract was for the period between 2nd May 1994 to 1st May 1998 as the Secretary to the Plaintiff’s Board. In 1996, the Plaintiff decided to sell 19 of its staff premises to its members of staff. The premises were valued and then put on tender to all the Plaintiff’s members of staff. The Defendant applied for the premises he was then occupying and won it. The Plaintiff accepted the Defendant’s bid for the sum of $85,000. The premises was then identified as Parcel No. 191-032-2. The Defendant applied on 1st October 1996 to the National Provident Fund Board (the NPF) for a loan to enable him to buy the premises offered for sale to him by the Plaintiff. The NPF’s response was that it would not consider the Defendant’s application until the subdivision of Parcel No. 191-032-2 was completed. The subdivision took 18 months to complete. Form 4 was then signed by the Plaintiff and the Defendant. It was dated 24th April 1998. Form 4 is the transfer document used by the Commissioner of Lands to transfer title in fixed-term interest to persons who lease land from the Commissioner of Lands. The Defendant’s employment contract also expired on 1st May 1998, but was not renewed by the Plaintiff. The purchase price of $85,000 had not been paid by the Defendant on the date of the expiry of his contract. On 6th October 1998, the Plaintiff issued to the Defendant a Notice to vacate the premises he was then occupying as the Defendant was no longer the Plaintiff’s employee and had not paid for it up to that date. The Plaintiff again on 5th November 1998 issued to the Defendant a Notice to vacate the premises immediately. This was the final Notice to vacate the Plaintiff’s premises. The Plaintiff rescinded the sale agreement but the Defendant has continued to occupy the Plaintiff’s premises up to date.

The issues to be decided

The first issue that I must decide is whether or not the Plaintiff was obliged to renew the Defendant’s employment contract once it expired as it did. The second issue that I must decide is whether or not the Plaintiff was obliged to sell for all time, the premises to the Defendant. The third issue I must decide is who is the legal owner of the premises so as to exclude the claim of ownership by the other.

The Law and Conclusion

A contract binding at law is founded on an agreement between two parties to the contract. There must be meeting of the minds as it is often said in the law of contract. Was there a meeting of the minds after the expiry date of the Defendant’s employment contract? The answer was clearly no. There was no agreement between the Plaintiff and the Defendant to renew the Defendant’s employment contract. There was no contract made. It is unfortunate that the Defendant’s previous contract of employment was not renewed by the Plaintiff. In employment contracts, the employers for obvious reasons have the upper-hand the world over. In this case, the non-renewal of the Defendant’s previous contract of employment is a non-issue. There was no contract in existence. However, the offer by Defendant to buy the premises and the acceptance by the Plaintiff to sell it to the Defendant for the sum of $85,000 was a valid contract. The Defendant however, breached it when he failed to pay to the Plaintiff the sum of $85,000 as was his obligation under the sale agreement. The sum of $85,000 was the consideration, the benefit the Plaintiff would have enjoyed for giving up its title to the premises or the loss it would have suffered if it was not forthcoming from the Defendant. Although the non-payment of the sum of $85,000 was a breach of the sale agreement, the contract was still on foot until its rescission on 5th November 1998 when the Plaintiff finally withdrew from its obligation under the contract for failure of consideration on the part of the Defendant. The contract came to an end on 5th November 1998. The reason for the Plaintiff deciding to rescind the contract was the Defendant’s breach of the contract in failing to pay over the sum of $85,000 for the benefit of obtaining the title to the premises.

Form 4 though executed by both the Plaintiff and the Defendant on 24th April 1998 is an empty document. It is not legally valid for any reason. Title cannot transfer to the Defendant without the payment of the purchase price of $85,000 to the Plaintiff. The fact that it was done is a bad practice. Clause 1 of Form 4 clearly states that the transferor (being the Commissioner of Lands) must receive the purchase-price (being the consideration for the transfer of title) first before the transfer of title is made to the transferee. Short-cuts such as in this case could cause legal problems later if transfer and registration of title take place without consideration for the transfer of title being first received. Parcel No. 191-032-129 therefore remains the property of the Plaintiff for all purposes. It would appear that after the completion of the subdivision of Parcel No. 191-032-2, the Parcel Number of the premises occupied by the Defendant became Parcel No. 191-032-129. This is clearly borne out by Form 4. In the end, the Plaintiff wins its case against the Defendants on the grounds set out in the Plaintiff’s statement of claim. There is however the counter-claim by the Defendant for specific performance, breach of contract and damages etc set out in his counter-claim.

By letter dated 16th September 1996, the Plaintiff informed the Defendant of its willingness to accept the Defendant’s offer to purchase the premises on Parcel No. 191-032-2 provided the Defendant was able to obtain funding from the NPF before the end of September, 1996. By letter dated 30th September 1996, the Plaintiff wrote to the NPF confirming that the Defendant was the employee of the Plaintiff on contract which was due to expire in May, 1998, subject to renewal by mutual agreement. The Defendant applied to the NPF on 1st October 1996 for a loan for $85,000. On 16th March 1998, the Defendant wrote to the Plaintiff seeking a renewal of his contract. The Defendant’s request for a renewal of contract was rejected by the Plaintiff and the Defendant was informed of this by letter dated 1st May 1998. By Letter dated 19th May 1998, the Plaintiff informed the Defendant that he was no longer its employee and if he did not come up with the sum of $85,000 by 31st July 1998, the sale agreement would be cancelled. By letter dated 5th August 1998, the Plaintiff again extended the deadline to 4.30 pm of 14th August 1998 with the rider that failure to pay the sum of $85,000 would result in the cancellation of sale as previously agreed. By letter dated 21st August 1998, the Plaintiff warned the Defendant that if his attempt to secure a loan from the NBSI failed, the sale would surely be cancelled. By letter dated 24th August 1998, the Plaintiff again extended the deadline to 28th August 1998. This was the final deadline. This was not to be so. By letter dated 7th September 1998, the Plaintiff changed its mind and extended the deadline to 30th September 1998. This was the last deadline. The first Notice to vacate the premises went out to the Defendant on 6th October 1998. The second Notice to vacate premises went out on 29th October 1998. The third Notice to vacate went out on 5th November 1998 with the clear threat to repossess the premises.

The Plaintiff cancelled the sale agreement between itself and the Defendant in paragraph 5 of its first Notice to vacate of 6th October 1998 above. The Plaintiff had given the Defendant 5 extensions of time within which to pay the sum of $85,000. That is the hallmark of leniency towards the Defendant. As I have already said in this judgment, there was no longer a contract in existence after the Plaintiff rescinded the sale agreement on 6th October 1998. The Defendant had failed to perform his side of the bargain and thus forced the Plaintiff to rescind the sale agreement because of that breach committed by the Defendant. It was unfortunate that the Defendant’s contract of employment was not renewed and that Parcel No. 191-032-129 did not come into being until 18 months later. Events did not favour the Defendant in this case. The Defendant in his evidence laboured the point that he was victimised by the Plaintiff in its dealing with him. I do not think so. The payment of the purchase price of $85,000 was a fundamental term of the sale agreement. The non-performance of that obligation by the Defendant was a fundamental breach of the sale agreement. The Plaintiff was perfectly entitled to rescind the contract on this basis as it did. The Plaintiff was therefore duly discharged from its obligation under the sale agreement following rescission of the sale agreement, (See paragraphs 541 and 542 at 372 of Halsbury’s Laws of England, 4th Edition, Volume 9). I therefore find that the Defendant has no case for specific performance and no case for breach of contract. The Defendant’s counter-claim is therefore dismissed.

Relief Requested by the Plaintiff

As I have said in this judgment, I find in favour of the Plaintiff and accordingly enter judgment for –

(a)	Damages for trespass;
(b)	Possession of the premises;
(c)	Mesne profit at the rate of $2,500.00 per month as from 6th October 1998 until possession of the premises is obtained;
(d)	Interest;
(e)	Costs.

The time given for payment of the purchase price of $85,000 was any time before the end of September, 1996. However, further extensions of time for payment of the purchase price kept the sale agreement on foot until the final Notice to vacate the premises on 6th October 1998. (See paragraph 486 of Halsbury Laws of England, 4th Edition, Volume 9 at 340-341). Damages are to be assessed from 6th October 1998. Upon application by Mr. Radclyffe, I Order that the Defendant vacate the premises within 14 days from today. I Order accordingly.

F.O. Kabui
Judge