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Marchand v Franconieri [2003] VUSC 5; Civil Case 084 of 2001 (16 January 2003)

IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

Civil Case No. 84 of 2001

BETWEEN:

FRANÇOIS MARCHAND
Plaintiff

AND:

JOSE FRANCONIERI
Defendant

JUDGMENT

This action concerns the land in lease title 11/OX21/022. The defendant is the registered owner of that land.

The plaintiff claims that in early 1996 the defendant orally agreed to sell the land to him for VT11,000,000. The sum of VT1,100,000 was paid by way of deposit. He said he was allowed into the land until he’d paid the balance, then title would be transferred. He never paid the balance.

The plaintiff was on the land for six years. He left during the course of these proceedings and took his possessions with him.

While he was in occupation he says he installed electricity, telephone and power, he fenced the property. He erected or partially erected buildings. He maintained the premises and did a variety of other works, not actually to the land, for the defendant. He now claims the costs of those installations and the value of that work. In the alternative he also claims for enforcement of the original contract, asking the Court to set a deadline for payment of the balance of the purchase price.

Mr. Marchand gave evidence by way of affidavit and oral evidence. He was cross-examined. An affidavit of Joseph Bob was also put in evidence. He was not cross-examined.

The defendant called no evidence and relied upon a submission of no case to answer. He has a lawyer.

The plaintiff has no lawyer. I must look carefully at what he says and ensure, all applicable law is taken into account, whether or not he has raised it.

It is also clear that, whatever the law, the plaintiff feels he is entitled to money for the time, work and improvements he has put into this land.

I have only the evidence François Marchand, and a short affidavit of Joseph Bob. Mr. Marchand was cross-examined on matters of truthfulness, reliability and consistency. I must judge the case on the evidence before me.

In his affidavit Mr. Marchand set out the work he says he had done. In mid 1996 there was the installation of electricity, telephone and water. He says he then completely fenced the property, and put up a temporary house in March 1996. In February 1997, he carried out “gros oeuvre d’une maison en dur”. He lists a large amount of work he has done for the defendant away from the land e.g. repair of his machinery, manufacturing metal goods, gates etc.

In evidence he said he had the finance from the Westpac bank to pay the balance of the purchase price. The defendant intervened and made sure the loan was not given. He denied he was unable to raise the balance of the monies. He stated there were several verbal understandings when the defendant was happy for the plaintiff to continue doing the various works as rent for his occupancy. It was agreed his occupancy of the land could continue until the disputes he had with his brother-in-law were resolved and his finances improved.

He has provided an album of photographs to support his evidence. He made building permit applications in his own name. He hoped to subdivide the property, half for the commercial purposes, half residential. Correspondence about the financing of his business and loans is included. In April 1998, loan funds were refused by Westpac. There were lawyers and bank bills that were not being paid.

Mr. Marchand has included in his affidavit receipts for building materials, work and wage sheets for workers. They are set out in the order and with the numbers of his claims in paragraph 7 of the statement of claim. The defendant was cross-examined to say the building permit conditions were not complied with. In at least one document he represented he was the owner/lessee, when he was not.

In January 2001 the defendant was still prepared to transfer the lease, as long as the balance of the purchase price was paid, (letter of 8^th January 2001). As late as July 2001 the defendant was prepared to transfer if the money was paid (letter of 6^th July 2001).

On 25^th June 2001 the plaintiff commenced these proceedings. The defendant entered an appearance on 12^th July. A defence and counterclaim was filed on 26^th September. Eviction of the plaintiff was also sought. The plaintiff agreed to move out voluntarily in October. There was some dilatoriness in the way the plaintiff conducted these proceedings. He moved out “on the basis his claims for improvements would be heard”.

The defence have called no evidence. They rely on their submission of no case to answer.

It is undisputed the plaintiff orally agreed to buy the defendant’s land for VT11,000,000. Ten per cent was paid, but nothing more. He has occupied the land for six years.

The plaintiff says the defendant was happy for him to do the works on the land. There is no evidence to the contrary. However, that was clearly on the basis the plaintiff would pay the balance of the purchase price. The other works off the land were by way of “rent”.

It cannot be said the defendant is going to benefit from improvements to the land if he is under a contractual obligation to transfer the lease if the balance of the price is paid. There would simple be no benefit to him. He will benefit to the extent of improvements made if there is no lease transfer. He argues many “improvements” are not so.

Does the plaintiff have some kind of proprietary estoppel or other equitable remedy? Firstly, Mr. Marchand is the plaintiff, he is not seeking to use the estoppel as a shield as a defendant.

This is not the kind of circumstance where someone is allowed to build on land without any legal interest, then required to leave. (It must be noted that the contract for the sale appears not to have been reduced to writing or registered. However, the defendant was prepared to abide by it).

Mr. Marchand had been in business for about ten years when the original agreement was made. He was not a naïve or inexperienced person.

He made the agreement and paid the deposit. He clearly hoped to borrow the balance. That proved impossible. He then applied such monies as he had to the land and not in payment of the purchase price. It would appear he hoped through his business and living on the land to get the money to pay. That didn’t happen. He did not apply any of his spare money to the balance. The defendant was patient, for a long time then his patience ran out. Common sense dictated Mr. Marchand should have applied all spare money to pay off the balance. He didn’t.

The defendant and plaintiff clearly have done other business together, and the defendant has used part of the land occasionally on a casual basis. He must have been aware the plaintiff was building. He allowed that to happen. That can only be on the basis he was expecting to be paid the VT9,9 Million.

The items listed in 7 (ix) – (xxiv) have no direct reference to this claim. They relate to other dealings between the parties. The plaintiff says rent for occupation. Indeed, if they were related to the agreement, on his own figures the plaintiff would have paid an extra VT6 Million beyond what he was obliged to do. He never sought enforcement of the agreement until the defendant required his removal. Item 7 (viii) is a running expense. The plaintiff was in possession and had the benefit thereof.

On the evidence the defendant has the property, the deposit and the benefit of water, electricity and telephone there and some buildings. He has averred they are not buildings which improve the property. The quality and state of repair of the fencing is not clear. It would appear from the plaintiff’s photographs a large and derelict lorry has been removed from the property and dumped outside on the public highway.

The plaintiff has put money into the land (see paragraph 7 (i), (ii), (iii) and (vii)) and lost his deposit. Yet he has had the use of it as a residence and workshop for six years. He has paid “rent” for his occupation by doing jobs for the plaintiff.

There is no prospect of the plaintiff paying the balance of the purchase price.

The plaintiff claims a total of VT725,000 in respect of the installation of power, water and telephone. He has had the use of those for six years, but they have also benefited the land.

The receipts purchased show a total outlay of Electricity VT143,136, Water VT4,780 and Telephone VT63,125 a total of VT211,041 (see E1). Receipts for fencing show a total of VT1,004,582 not VT1,445,000 as put in the statement of claim, (see F1).

The planning permission for the buildings expired. The Municipal Council considered them to be illegal buildings, (see letter of 20^th December 2000). They are only half complete. I cannot make any award in respect thereof.

Taking the electricity, water, telephone and fencing together the plaintiff has expended VT1,215,623. He has had the use of them for 6 years. Reduction should be made for that. Accordingly I deduct a half and award the plaintiff the sum of VT607,812.

The counterclaim is dismissed.

There will be no order for costs.

Dated at Port Vila, this 16^th day of January 2003.

R. J. COVENTRY
Judge.