Tall Ponga Ltd v Professional West Realty (Fiji) Ltd [2012] FJHC 1340; HBC208.2010 (25 September 2012)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No. 208 of 2010

BETWEEN:

TALL PONGA LIMITED,
a company incorporated in New Zealand and having its registered office at c/- Cleaver Richards Limited, Level 1, 26 Crummer Road, Grey Lynn, Auckland, New Zealand.
PLAINTIFF

AND:

PROFESSIONALS WEST REALTY (FIJI) LIMITED,
a company incorporated in Fiji and having its registered office at 18 CAAFI Compound, Newtown, Nadi Airport, Fiji Islands.
DEFENDANT

Before:
Priyantha Nāwāna J.
Counsel:
For Plaintiff : Mr Carl Ngamoki-Cameron
For Defendant : Ms M Vanua with Mr Nemani Vakacakau

Date of Trial : 27 August 2012
Written-Submissions : 14 September 2012
Date of Judgment : 25 September 2012

JUDGMENT

1. The plaintiff, by its writ of summons dated 21 October 2010, filed this action against the defendant seeking principally a sum of $ 49,000.00, the interest thereon and costs on indemnity basis.
   
2. The suit was founded on the premise that the sum of $ 49,000.00 became due as the defendant wrongfully retained the same as a part of commission out of a deposit of $ 85,000.00 in defendant's favour to execute a sale of land.
   
3. Facts revealed that the plaintiff, an offshore property owner, secured the services of the defendant in terms of an agency agreement entered into on 12 November 2008 for the sale of Lot 47 at Sovereign Quay, Denarau in Nadi for a price of $ 17, 00, 000.00. The plaintiff, in terms of the agreement, undertook to pay a commission at the rate of 4% of the sale-price with the Value Added Tax. The commission under the agency agreement became payable after a purchaser was introduced by the defendant and upon the contract [of sale] becoming unconditional and binding on the plaintiff and the purchaser.
   
4. The defendant, in furtherance of the agency agreement, introduced Native Finance Fiji (Ltd) [NFF] as a prospective buyer of the property. A Sale and Purchase Agreement was, accordingly, entered into on 24 July 2009, which was later amended from time to time, for the sale of the property at the price of $ 17,00, 000.00. An amended agreement was entered into on 08 December 2009 with the Minister's consent having been obtained, validity of which was later extended. The agreement required the NFF to make a deposit of $ 85,000.00 at the rate of 5% of the sale-price in favour of the trust account of the defendant. It was a part of this deposit that the defendant had forfeited as a part of its commission, which, the plaintiff now seeks to recover in these proceedings.
   
5. The plaintiff, in its statement of claim, continuously sought to maintain that the Sale and Purchase Agreement without the Minister's consent at the time of its execution was void and unenforceable in law. Learned counsel for the plaintiff, in his written-submissions, too, contended that the Sale and Purchase Agreement was invalid for want of Ministerial consent initially under Section 6 of the Land Sales Act.
   
6. Ms Lynne Frances Pollock, in her capacity as a shareholder and a director of the plaintiff-company, gave evidence on plaintiff's behalf. The plaintiff, having filed two sets of documents being 'agreed' and 'not agreed' bundles of documents, did not, however, tender any document in the course of its witness's evidence as exhibits to establish documentary proof to advance its case; but, referred only to the documents in the two bundles.
   
7. The plaintiff's witness did not deny the fact that the buyer was introduced by the defendant under the agency agreement for the sale of the property at $ 17,00,000.00. Instead, she admitted under cross-examination that the plaintiff undertook to pay the commission in terms of the agency agreement upon the Sale and Purchase Agreement becoming unconditional with the receipt of the Minister's consent subsequently.
   
8. It was not disputed between parties that a sum of $ 36,000.00 out of the deposit of $ 85,000.00, made by NFF and lying in the trust account of the defendant, was paid to the plaintiff on or about 22 April 2010 as rent for the property for about six months as NFF took time to settle the total purchase price.
   
9. NFF, however, repudiated and avoided the Sale and Purchase Agreement on or about 02 September 2010 as it was unable to secure the required finances. The plaintiff, thereupon, made a claim for the balance sum of $ 49,000.00 of the deposit from the defendant stating that the Sale and Purchase Agreement was unlawful for want of Ministerial consent at the outset.
   
10. Thus, the plaintiff, who did not dispute that the sale was to be effected on the basis of the Sale and Purchase Agreement, if not for NFF's repudiation of the agreement on or about 02 September 2010, now claims that the defendant was not entitled to any commission alleging that the Sale and Purchase Agreement was void.
    
11. Ms Caroline Jane West of the defendant-company testified on behalf of the defendant. It was her evidence that upon entering into an agency agreement with the plaintiff, the property was listed for sale and advertised for local and overseas buyers. The plaintiff, in terms of the agency agreement, undertook to pay a commission at the rate of 4% of the sale price of $ 17,00,000.00 upon the agreement becoming unconditional with the receipt of Ministerial consent. It was not disputed in the course of Ms West's testimony that the buyer-NFF was, in fact, introduced by the defendant in accordance with the agency agreement.
    
12. I have considered the evidence adduced on behalf of the plaintiff, though presented in an incoherent manner, in order to address the issues raised by the parties as set-out in the pre-Trial Minutes dated 06 December 2011 in light of the pleadings and the evidence placed on behalf of the defendant.
    
13. The plaintiff, who had secured a buyer to effect the sale on the Sale and Purchase Agreement on the basis of its legality, cannot attribute illegality to the self-same Agreement in order to disentitle the defendant of its contractual entitlement to the commission under the agency agreement. The transaction was not frustrated due to any element of illegality in the Sale and Purchase Agreement but due to a volitional act of repudiation by NFF. The Sale and Purchase Agreement, if at all was affected by an illegality, the Agreement should have been avoided by the plaintiff before it was repudiated by NFF.
    
14. The plaintiff, in the course of its evidence or otherwise, failed to convince court that the Agreement was tainted with an illegality. It also did not establish on a balance of probability that the defendant was not entitled to the commission stipulated in the agency agreement; and, that it was disqualified from forfeiting the deposit in settlement of its commission.
    
15. I am of the view that the provisions of the agency agreement were clear and without any ambiguity as regards the situations that the defendant became entitled to the commission under that agreement. Those criteria, in my view, were met in favour of the defendant under the agency agreement. I accordingly hold that the defendant was entitled to forfeit the deposit in realization of its entitlement to the commission.
    
16. The plaintiff's claims, therefore, do not have merit. I dismiss the plaintiff's action but without costs having regard to all the circumstances of this case.
    
17. The defendant, too, has not proved its case on the counter-claim. I dismiss the defendant's counter-claim as well without costs.
    
18. Orders, accordingly.
    

Priyantha Nāwāna
Judge
High Court
Lautoka
25 September 2011