"2. Athe $10,000.00 your clients should before asking for paymenayment ask themselves whether they have not already received
satisfaction for that sum. They must realise that our client is known for his straight dealing and a word once given is not broken.
The situation here is that your clients asked ours not to dismantle or sell his buildings, but to leave them as they were. Your clients
agreed that the purchase price of all the buildings and structure was sealed at $10,000 and the payment was therefore required ..."
Quite plainly in terms of the above, the respondent's counsel was claiming that 'Clause 5' of the 'consent order' had been superseded or varied by a subsequent oral agreement between the parties in which both parties agreed to forego their respective
'rights' under the 'terms of settlement', namely, the respondent's right "... to remove all structures and improvements made by him on the said land not later than 30/8/89", and on the appellants' part, their right to receive payment of "... the sum of $10,000 representing arrears of rent ... in respect of the (respondent's) occupation of the land comprised in
N.L.11645 and C.T. 33/3364 ... (by) 30/11/89."
In light of the foregoing and the pleadings, the case before the learned trial magistrate may be said to arise within a fairly confined
factual parameter, which is accurately and concisely summarised by the learned trial magistrate in the following paragraph at p.6 of his judgment where he states:
"The crux of the problem stated in a nll is that there had been aeen a settlement of an Agricultural Tribunal action between
the plaintiffs (appellants) and the defendant (respondent). The plaintiffs had bought some land containing both Freehold and Native
lease land of which the defendant and another were trustees. By an agreement dated 9.5.89 between the parties the defendant had agreed
to pay a sum of $10,000 not later than 30/11/89 and the defendant was entitled to remove all the improvements on the said land within
3 months of the date of the agreement. The defendant contends that when he was in the process of removing the structure the first
two plaintiffs representing the others had verbally agreed to forego the $10,000 in exchange for the removing (sic) buildings on
the land. The plaintiffs deny the existence of such an agreement and contend that the sum of $10,000 is still due."
Equally the limited naturehe dispute between the parties gave rise to three (3) 'issues' which hich the learned trial magistrate identified at p.6 of his judgment (p.117 of record) as follows:
"(1) If there was aal agreement between the parties to vary the provision of t of the written agreement?
(2) If so, could a verbal agreement vary the term of a written agreement? ent? and
(3) Whether the two persons could act on behalf of five persons."
Having thus set oe 'issues' raised for determination, the learned trial magistrate then proceeroceeded to deal with the evidence regarding each 'issue' in turn, and concluded by holding:
"... on a balance of probabilithat the plaintiff (appellants) had entered into a verbal abal agreement with the defendant (respondent)
to vary the terms of the written agreement entered into between them earlier - agreed to accept the removing (sic) buildings on the
land in exchange for the sum of $10,000."
The appellants appeal against the judgment on two (2) grounds as follows:
(2) That the learned trial magistrated in law and in fact in holn holding that the first and second named Appellants did agree to
accept satisfaction of the payment of the respective shares of the third, fourth and fifth appellants from the Respondent."
At the outset I confess that havarefully perused the learned trial magistrate's judgment I have been unable to find anywherywhere
in the judgment the two (2) 'holdings' referred to in the 'Grounds of Appeal', nor did counsel for the appellants specifically draw the court's attention to any such 'holdings'.
Be that as it may at the hearing of the appeal counsel for the apnts argued two (2) matters summarised in his writtenitten submissions as follows:
"(1) Whethergreement in writing can be varied by an oral agreement?&quo?" (the 'legal' ground) and
"(2) Whether two Appellantsd agree to the variation of the agreement on behalf of the the other three Appellants." (the 'factual or implied agency' ground)
As to the 'legal ground', counsel's simple ssion is "that a partial discharge of an agreemereement that must be evidenced in writing, by law, must itself be evidenced in writing" and Counsel cites Australian Provincial Assurance Association Ltd. v. Rogers [1943] NSWStRp 6; (1943) 43 S.R. (N.S.W.) 202 as authority for such a proposition. Counsel's submission in an expanded form is that the 'terms of settlement' being in substance and effect an agreement to grant a lease over land together with an option to purchase land, was required, in
terms of Sections 59(d) of the Indemnity Guarantee and Bailment Act (Cap. 232) 'to be evidenced in writing' and therefore could not be orally varied.
With that submission I entirely agree. In Vob> of Halsbury's 'Laws of England' > (4th edn.) the law is correctly set out in the following passage in para.570 which reads:
"Where ... the contract is required by law to be evidenced in wr it cannot be varied by an y an oral agreement, even if the variation
relates only to a part of the contract which, if it stood by itself, would not require to be evidenced in writing."
(See: Harvey v. Grabham (1836) 4. 379)
Having said that however, there is in my view no requirement 'by law' that an agreement to pay a sum of money must be evidenced in writing albeit that the payment represents rental arrears.
I am also not unmindful that Section 5 merely renders any offending contracts 'unenforceable'able', but that does not mean that such contract may not be pleaded as a defence.
The appellants in seeking by action to enforce not the entire agreement, but only that part relating to the payment of rental arrears (namely Clause 5) have themselves treated the 'Clause' as being a separate contract divisible from the whole.
Of such a contract not required by law to be in writing, Denman Ch. J. said inu> Goss v. Lord Nugent< (1833) 39 R.R. 392 at p.398:
"By the general rules e common law, if there be contract which has been reduced iced into writing, verbal evidence is not allowed
to be given of what passed between the parties, ... before the written instrument was made ... so as to add to or subtract from ...
the written contract; but after the agreement has been reduced into writing, it is competent to the parties, at any time before breach
of it, by a new contract not in writing, either altogether to waive, ... the former agreement, or vary or qualify the terms of it
and thus make a new contract; which is to be proved partly by the subsequent verbal terms engrafted upon what will thus be left of
the written agreement."
Viewed in that light the learned trial magistrate was perfectly correct in treating Clause 5 as a separate contract and in saying at p.7 of his judgment:
"A contract in writing may bied by an oral agreement, when the contract is not one that that is required to be in writing."
If I should be wrong howen affirming the trial magistrate's judgment in this regard, then I am satisfied that oral eral evidence was
admissible to show that the parties to the agreement accepted a substituted mode of performance or forbore from insisting up on strict compliance with the terms of Clause 5 of the agreement in circumstances which, amounted to a 'waiver' of the respondent's obligations thereunder.
In so saying I am not unmindful that the modified version of the original 'termsettlement' did notd not involve any significant change in either the underlying substance or primary obligations of the original agreement between
the parties. Indeed, the agreement to lease and option to purchase remained wholly unaltered by the operation of the 'waiver'.
As for the existence of the 'waiver', the evidence which was accepted by the le trial magistrate (especespecially at pp.6 & 7 of his judgment), clearly supports the existence of an unambiguous representation by the appellants arising out of a positive agreement entered into
between the parties during the course of the exercise by the respondent of his 'rights' pursuant to Clause 4 of the agreement, and which resulted in the respondent immediately ceasing to exercise his 'rights' leaving 'a half-pulled out building'.
Alternatively, the learned trial magistrate would have been entitled to find on the evidence accepted by him that the oral agreement
entered into by the parties amounted to 'accord and satisfaction' whereby the respondent has, to adopt the language of Scrutton L.J. in British Russian Gazette and Trade Outlook Ltd. v. Associated Newspapers Ltd. (1933) 2 K.B. 616 at 643:
"... purchased his release from his obligatioan> (arising under 'Clause 5' of the 'terms of settlement') by means of valuable consideration, not being the actual performance of the obligation itself."
In Lavery v. T (1860) 123 R.R. 485 where in a claim for goods sold the defendant pleaded tded that he and the plaintiff had orally agreed that he (the defendant) would give up possession of a public-house that he occupied and the plaintiff would discharge the defendant from the debt and the
defendant vacated the public-house but the plaintiff pleaded breach of the 'Statute of Frauds' in claiming the price of the goods, Pollock C.B. in rejecting the plea said at p.486:
"The objection is that the agreement is one which, by the Statute of Frof Frauds is required to be in writing; [See: our Section 59(e)] and that would be so if it were sought to enforce it as an agreement. But it is pleaded as a fact that the defendant performed the
agreement, and the plaintiff accepted such performance in satisfaction. (cf. para.3 of the Statement of Defence). The objection that the agreement was not in writing is got rid of."
This latter case provides a clear instance of a Court recognithat there may be a 'valid oral accord' in r in respect of a contract required by law to be evidenced in writing, and that such accord would be upheld as a good defence,
the Court not being concerned to inquire into the adequacy of consideration where a creditor accepts in satisfaction something different
in nature from money.
ass=MsoNormal stal style="margin-top: 1; margin-bottom: 1"> The appellant's 'legal ground' cordingly dismissed as being without merit. I turn next to t to consider the 'factual or implied agency ground' of appeal.
In this regard counsel for the appellants writes: "... in the instant case there is no evidence that the other three appellants had agreed to the variation of the Agreement" nor is there "... evidence regarding the conduct of the last two appellants to enable the learned Magistrate to come to the conclusion that
they had assented to the first two appellants to act on their behalf in the matter of the $10,000."
The learned trial magistrate for his part in dealing this 'issue' said at p.8 of his judgmeudgment (p.121 of the record):
"The nce given by the three plaintiffs in this case viz., Munshiunshi, Saizad, Kasim shows that Saizad had been managing the
land which the plaintiffs had bought - as far as Court matters are concerned. Saizad had been given verbal authority by the other
three brothers to take appropriate decisions. Saizad and Kasim also stated that there is no dispute amongst the brothers whatsoever
although they are now scattered in different areas. As far as father Munshi is concerned he too depends heavily on Saizad. In these
circumstances the three other plaintiffs could be said to have given their authority to Munshi and Saizad to act on their behalf
in the matter of the $10,000 too.
Hence the verbal agreement entered into between efendant on one part and thnd the two plaintiffs viz. Munshi and Saizad on the other
to exchange the sum of $10,000 for the remaining buildings could be considered to have been made by the two plaintiffs on behalf
of the other 3 plaintiffs as well."
In addition it is noteworthy that the original 'terms of settlement' was signed on behalf of three (3) of the five (5) named appellants by their attorney with only the first and second appellants signing in person. Clearly as late as then and in such
an important document, the 3rd, 4th & 5th named appellants were content to be represented by an agent.
What's more not having given evidence at the trial, there was no actual unequivocal evidence before the learned trial magistrate from
the 4th & 5th appellants that they had not authorised their father (Munshi) or, their brother (Saizad) to act on their behalf in regard to the $10,000.
ass=MsoNormal stal style="margin-top: 1; margin-bottom: 1"> Counsel for the respondent also drew the Courttention to numerous passages in the appellants evidence whie which counsel submits were
capable of raising an 'implied agency' on the part of the second-named appellant to act for the others. Arising in particular, in the second appellant's evidence in cross-examination
where he said (at p.89):
"I am the second eldest son. Now I am living wi father. Others are far awar away. No disputes. On good terms. No question of
a leader ... in this matter I am the leader. I represent the others. I consult them. I am giving evidence after having consulted
them."
and the third appellant (Kasim)
1"> "All my brothers are scattered now in different places. It is my father (Munshi) and Saizad that take decisions."
The learned editor of Bowstead on Agency (15th edn.) states inu>Art 3 at p.28:
"The relationship of principal and agent may be constituted-
(a) by agreement, whether contractual or not, between principal and agent, which may be express or implied from the conduct or situation of the parties."
(my underlining)
In this case not only were the appellants closely related by blood either as brothers or as father and sons, but it appears to be
common ground that Munshi (the father) and Saizad (the second eldest brother) as the persons who lived on the land had been authorised generally by the other appellants to handle all court matters relating to
the land and played a leading role in all negotiations.
Then there were the false denials by the first and second appellants er attending a meeting with with the respondent where the exchange
of the respondent's remaining houses on the land for the $10,000 was discussed and agreed upon. Such false denials going to the root of the case, was clearly relevant material to be considered by
the learned trial magistrate in determining the case. [Moriarty and wife v. London, Chatham & Dover Railway Co. (1870) L.R. 5 Q.B. 314]
In these circumstances the learned trial magistrate was entitled to hold as a fact thatb>'implied agency' existed between the two active appellants and the other non-active appellants.
Even if the general rity of the 1st and 2nd appellants did not extend to agreeing to a variation tion of the 'terms of settlement' or to accepting the respondent's houses in lieu of the rental arrears, the fact remains that the respondent had only ever dealt with
two (2) of the five (5) appellants, and given the close family relationship between the appellants and the considerable distance and non-involvement of the other three (3) appellants in matters concerning the land, the learned trial magistrate would have been entitled to hold that the 'course of dealings' between the parties was such as to give rise to an 'agency by estoppel'.
Needless to say the existence of an agency is a question ot for the determination primarily of the trial court on then the basis of
the evidence led before it and any reasonable inferences that may be drawn therefrom.
As was said by Pollock C.B. in Smith v. McGuire (1858) 117 R.R. 853 at p.858:
"Persons are supposed to carry on their business according to the ordinary arrangements of mankind generally. If a person conducts
his business, as the defendant did, by an agent who acts in his absence, in my judgment it is a question for the jury whether, according
to the ordinary mode in which business is carried on, the reasonable inference to be drawn from these circumstances is not that he
had authority as a general agent; and if so the principal is bound, though it should turn out that he had limited the extent of the
agency by certain rules and regulations."
Having myself considere evidence I am satisfied that there was evidence before the trial magistrate which supportpported his findings
in that regard.
The apis accordingly dismissed with costs to the respondent.
p class=MsoNormal alal align=center style="text-align: center; margin-top: 1; margin-bottom: 1"> D.V. Fatiaki
JUDGE
At Labasa,
5th November, 1996.
Hba0005j.96b
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