Kumar v Kumar [2001] FJHC 242; HBC17.1999 (23 October 2001)

IN THE HIGH COURT OF FIJI
AT LABASA
CIVIL JURISDICTION

CIVIL ACTION NO. 17 OF 1999

Between:

BIJENDRA KUMAR s/o Babu Lal
Plaintiff

And

RAJ KUMAR s/o Budh Ram
Defendant

Mr. R. P. Singh for the Plaintiff
Mr. A. Sen for the Defendant

JUDGMENT

By Writ of Summons dated 16 March 1999 the plaintiff Bijendra Kumar (as purchaser) has sued the defendant Raj Kumar (as vendor) for specific performance of a Sale and Purchase Agreement (the agreement ) dated 17 November 1992 and made between them wherein the plaintiff agreed to buy the leasehold property of the defendant known as Crown Lease No. 6109 comprising 10 acres 2 roods and 31 perches and described as Lot 10 on Plan M2695 Wailevu Rara for the sum of $53,000.00 (hereafter referred to as the "property").

The plaintiff’s claim is that it was agreed that the said sum of $53,000 was to be paid by cultivating sugar cane on the property. The defendant owed some money under a mortgage and crop lien to the Fiji Development Bank (‘FDB’). The plaintiff says that he paid the sum of $34,690.00 by cultivation of cane through proceeds to FDB as shown in the bank statements of FDB. He says that he made further direct payments to the defendant in the total sum of $7750.00. These payments were made at various times between 19 August 1994 and 17 September 1997 on eleven different occasions (as stated in clause 8 of the Statement of Claim). This amount of $7750 is admitted by the defendant as having been paid to him.

By letter dated 14 May 1998 the defendant ‘requested’ the payment of the alleged balance purchase price the sum of $22,100.00 in default of which ‘the agreement would be breached and terminated’. The plaintiff resisted this saying that the defendant is "estopped from claiming that the agreement was terminated because by his conduct he has permitted the plaintiff to pay the outstanding amounts gradually by cane proceeds".

To complete the factual background to the case the following are the ‘Agreed Facts’ as stated in a document dated 24 May 2001 and handed in to court on the day of the hearing:

1. THAT the Sale and Purchase Agreement is binding between the parties and has been varied by conduct to the effect that the Plaintiff was to pay the consideration sum of $53,000.00 by cultivation of sugar cane of the land the subject matter of this case. The Defendant is agreeable to execute the transfer of the said land and other necessary papers to effect transfer provided the balance amount is ascertained and paid.
   
2. THAT the said land was subject to Mortgage and crop lien in favour of the FDB loan which had advanced certain sum of money to the Defendant.
   
3. THAT the Plaintiff began cultivating sugar cane on the said land on 17/11/1992 and began to harvest and sell sugar cane to the Fiji Sugar Corporation.
   
4. THAT by virtue of the crop lien all sugar cane proceeds were paid to the Fiji Development Bank on account of the Defendant.
   
5. THAT the Fiji Development Bank received the moneys from Fiji Sugar Corporation from time to time and refunded part of the money to the Defendant as per the statement of Fiji Development Bank.
   
6. THE defendant agrees to transfer the land to the Plaintiff upon ascertaining whether the full consideration sum has been paid by Plaintiff to the defendant.
   
7. THE full amount paid by the Plaintiff to the Defendant is per the attached accounts.
   
8. APART from the amount paid through the Fiji Development Bank, the Plaintiff paid the sum of $7,750.00 to the Defendant (see paragraph 7 of the pre-trial minutes).
   
9. IN view of the delayed settlement in this matter, the Plaintiff is agreeable to pay the actual interest to the Fiji Development Bank and to pay the interest at the rate of 7% per annum to the Defendant on the reducing balance.
   
10. IT is agreed between the Plaintiff and the Defendant that the amount paid by Fiji Sugar Corporation to Fiji Development Bank and the amount refunded to the Defendant to be put in the statement of accounts. The rate of interest at the 7% per annum be payable to the Defendant on the reducing balance subject to the finding of the Court in the issues specified hereunder.
    

The FDB’s letter (exhibit I) sets out the account as follows:

Total Cane proceeds Received [1993 - 31/5/99]	$54,100.50
Total Amount Deducted by the Bank	$24,335.00
Total amount Refunded to client	$29,765.50

This is the records that we have in our file and statements. The above client should also have a copy of his statements from which the date could have been extracted.

Issues

The issues for the Court’s determination, as agreed, are:

1. Whether the Defendant has paid some of the moneys refunded by Fiji Development Bank to the Plaintiff and if so what is the amount?
   
2. What is the balance amount due by the Defendant to the Plaintiff, if any.
   

Defendant’s evidence

The defendant testified that at the time when he entered into agreement FDB was owed $20,397.61. He says that he is entitled to interest at the rate of 7% on the amount owed to him by the plaintiff. According to records at FDB until 10 June 1999 he was paid $29,765.50. He said that between 10 June 1999 and 31 October 1999 he received two refunds of $219 each; and upto year 2000 further refunds of $219, $500, $200 and $230 were received making a total of $1587.00. So a total of $31,352.50 (made up of the said $1587 and the said $29,765.50) was paid to the defendant from cane proceeds.

In cross-examination he admitted he was paid $31,352.50 by FDB and was also paid $7750 by the plaintiff. He said that the moneys he ‘withdrew’ from FDB he gave to plaintiff; because he was the FDB’s ‘customer’ it gave these sums to him and the defendant in turn paid this to the plaintiff or to his wife or to his father. But he did not obtain acknowledgment or receipt for these payments. He said that out of this $31,331.52 the plaintiff paid him the said sum of $7750.00.

Plaintiff’s evidence

The plaintiff testified that since 1992, after entering into the agreement, the cane proceeds from the property went to FDB to which moneys were owed by the defendant. Over the period in question the total sum of $31,352.50 was refunded to the defendant by FDB. He says that although the defendant says that he paid this money to him as and when he received it, the plaintiff denies ever receiving any of it. He says that neither his father nor his wife has anything to do with the property and there was no need to give any money to anyone to be passed on to him.

The plaintiff says that he paid the said sum of $7750.00 to defendant from his own resources. He says that the balance of the purchase price payable by him is $2587.39 and that he is willing to pay this in exchange for transfer of the property together with interest of 7% as agreed. He relies on FDB’s statement of account in regard to receipt of cane proceeds and ‘refund’ to defendant.

Determination of the issues

The determination of the issues depends on the credibility of the parties to this action. Both the plaintiff and the defendant have testified in Court and tendered documents in substantiation of their claims. Actually the question is whether the plaintiff has paid the amount of purchase price in full or not; and if not, what is the balance owing under the Agreement.

On the basis of the facts that have been admitted and those that I find as fact, I find as follows:

1. The purchase price is $53,000.00
   
2. At the time of the sale and purchase agreement FDB was owed by the defendant the sum of $20,397.61.
   

100. 
     

(i) Total cane proceeds received by FDB was $54,100.50.

(ii) It deducted $24.335.00 towards debt due to it

(iii) It refunded to defendant $29,765.50.

(d) It is admitted by the defendant that $7750.00 was paid directly to him by the plaintiff himself from his own funds.

So far, on the basis of the above figures the position is, that the balance sum of $20,915.00 is payable by the plaintiff towards the purchase price (made up of the said $53,000.00 less the said sum of $24,335.00 and less the said $7750.00 leaving balance of $20,915.00).

The question now is what has the defendant done with the said $29,765.50 plus a further sum of $1587 making a total sum of $31,352.50 which sum was in actual fact the cane proceeds from the property, and rightly the plaintiff should have been credited with this amount in terms of the Agreement. However, although the defendant says that whatever ‘refund’ that came to him from FDB was paid to plaintiff or to his wife or to his father, I do not on a careful analysis of the evidence before me believe him at all in this regard. In fact, I find that none of this money was ever paid to the plaintiff. He failed to keep any record of this alleged dealing nor did he obtain any receipt from anyone for these alleged payments. It is difficult to understand why a person who is owed a substantial sum under the agreement pay the plaintiff these sums of money whenever he received them and not obtain any receipts. He should have credited them towards the purchase price. Instead of doing that he accepts meagre sums over a period amounting to the said $7750.00.

I find that the defendant’s conduct and dealing smacks of dishonesty on his part by claiming the amount to which he is not entitled.

On the figures before me and on the evidence, the position is as follows:

1. The defendant was refunded a total of the said sum of $31,352.50 by FDB out of the plaintiff’s cane proceeds.
   
2. The balance of purchase price payable by the plaintiff was the said sum of $20,915.00
   

100. Hence there was an overpayment of $10,337.50 (arrived at by deducting $20,915.00 from $31,352.50) which is in excess of what the defendant as vendor is entitled to under the agreement towards the purchase price.
     

(d)

(i) However, as agreed the defendant is entitled to interest at $7% per annum on the principal sum from time to time on the reducing balance. In this regard the sum of $9000 has been stated in the evidence as due by the plaintiff to the defendant. But it is not clear as to upto what period the interest has been calculated.

(ii) In the circumstances it could very well be that the excess payment evens out when the said $9000 interest is taken into account; but it is still open to the parties to calculate the interest up to the period to which the defendant is entitled to satisfy themselves that the correct interest has been paid and adjust the excess figure accordingly.

Taking into account what I have stated hereabove, in the outcome, I find that, subject to adjustment of interest amount, the plaintiff does not owe the defendant anything under the agreement. He therefore succeeds in the action.

I therefore order specific performance of the agreement ordering the defendants to, once the interest figure is finalized, execute document of transfer of the property in the name of the plaintiff. The defendant is to pay the costs of this action to be taxed if not agreed. Liberty reserved to parties to apply particularly on the matter of calculation of interest.

D. Pathik
Judge

At Labasa
23 October 2001