Ramritu v Bharat [1978] FJSC 15; Civil Action 314 of 1976 (17 November 1978)

THE SUPREME COURT OF FIJI
CIVIL JURISDICTION

Action No. 314 of 1976

BETWEEN:

KANDHAIYA LAL RAMRITU
Plaintiff

AND:

SAMUEL BHARAT
f/n Ramritu
Defendant

Mr. K. C. Ramrakha for the Plaintiff
Mr. M. Pillai for the Defendant

JUDGMENT

Plaintiff and defendant are brothers.

Plaintiff is a shopkeeper and lives at 36 Howell Road, Suva. Defendant emigrated to United Kingdom in 1961 and is now permanently settled in London. There he works as master tailor. He still has a property, a house, at 227 Lakeba Street.

In 1973 and 1974 plaintiff managed the defendant's affairs in Fiji and was authorised to carry out certain work on the house at Lakeba Street. It is the expenditure incurred in carrying out this work which is in dispute. The plaintiff claims $20,462.20. The defendant denies that this amount is owing in respect of this work, though he does not deny owing any money at all.

A plan (Exhibit P1) showing the projected work was drawn by one Tikaram, a draughtsman, and approved by the Town Planning Board. It called for an extension to the house 10ft. x 3ft. and construction of a new porch 10ft. x 6ft. The extended structure would be 39ft. x 23ft. The roof was to be completely removed and replaced. Two-thirds of the walls were also to be replaced. Floor timber was to be changed only where necessary. There were other minor interior alterations to be carried out.

Tikaram, who was plaintiff's witness, said:

"The roof now does not appear to be of new material. There are many small pieces. The new wall seems to be of sawn timber not pressed timber which should have been used. According to my guess the work took two months. It would never take thirteen months."

Tikaram did not supervise the work but has seen the house from outside since the work on it was completed. The house is a wood and iron structure standing on concrete and wooden posts.

Attached to the statement of claim is a statement giving itemised expenditure. Major items relating to materials and labour are:

"New Building according to Approved Plan:

Material	11150.00
Casual Carpenters & Labour	950.00
Labour Contract	1450.00
Watchman's wages - 15 Oct. 73 to 30 Nov. 74	2030.00

Plaintiff has produced no documents whatever to show where and at what price the materials were purchased. According to him he has sent all the documents to the defendant's address in London and that he has calculated the total price of the materials on the basis of $12.50 per square foot of the floor area. As for the watchman's wages, he says that the whole work took more than thirteen months during which time the house remained unoccupied and a paid watchman had to be kept every night for the protection of the house and the building materials.

The items are under the heading "New building according to approved plan". The only plan approved by the City Council is Exhibit P1 and it certainly does not call for a new building. It relates only to extensions sad and repairs. According to the plaintiff's evidence; however, when the workmen started the repairs they found all the timber and most of the wooden posts rotten and infested with termites. They had, therefore, to dismantle the whole house and an almost completely new house was built in accordance with the drawings in Exhibit P1, He called two witnesses, casual carpenters, and a watchman who worked on the house at the earlier stages. They confirmed the plaintiff's evidence as to the demolition of the old structure and the building of a new house in its place. Delay in completing the work, according to the plaintiff, was caused by difficulty in procuring finance and casual labour. The whole work, he says, did take about thirteen months.

The corrugated iron used on the roof, he says, came from a large shed which he purchased at the Suva wharf from Christiani & Nielsen a firm of contractors. He has no documents whatever to show what the shed cost or how much of the iron was used on the defendant's house. The timber used on the house he purchased from Sawmillers in Nausori area. Again he has no document to show what timber was purchased and at what cost. It is the same with most of the other items in the statement of claim. The only documents produced by him are:

(i) A receipt (Ex. P9) dated 4th of February 1974 from a labour contractor to say that he had completed the building and received $1,450.

(ii) An invoice and 2 receipts (Ex. P8) to show that electrical wiring had been completed by 24th May, 1974 and Impact Electric had been paid a total of $125.

(iii) A receipt (Ex. P7) to show that one Ram Sami was paid $75 on 5th June 1974 for sanding the floor.

Apart from these, no books of account, invoices, receipts or any other documents of any kind evidencing expenditure on the house have been produced. Plaintiff maintains that he did have several of such documents but they were all sent to the defendant and must be in his possession. He does admit, however, that in relation to some items of expenditure, such as wages for casual labour, no record showing payment has been kept.

Defendant strongly denies that any documents or accounts were ever received by him. Apart from some letters, says he, he has received nothing from the plaintiff. The only statement of account ever received by him is the one attached to the writ.

I have no hesitation in accepting the defendant’s version. In this regard it is necessary to consider the relationship that existed between the two brothers at the relevant time. In 1973 when the plaintiff took over the management of the defendant’s affairs he was genuinely anxious to assist the defendant with the repair and improvement of his property. Plaintiff’s son Suresh was completing his secondary education and would be ready in 1974 to go to College. The defendant had offered to provide this boy board and lodging in London and generally to assist with his university education. All this is quite clear from the four letters from the plaintiff to the defendant which the parties have put in by consent and the two letters from the defendant to the plaintiff whose authorship the plaintiff admits. I am satisfied that the plaintiff kept no separate accounts for the work he did for the defendant, his principal. Apart from the three documents referred to above he was no invoices, receipts or other documents of any kind. The only indication of the amount of expenditure incurred by the plaintiff was perhaps in the overall estimates that he gave to the defendant whenever he wrote to him.

Mr. Pillai correctly submits that the law imposes a strict duty upon an agent to keep accurate accounts of small transactions undertaken by him on his principal's behalf.

"It is the duty of an agent to keep accurate accounts of all his transactions and to be prepared at all times to produce them to his principal. If he fails to keep proper accounts every presumption consistent with the facts will weigh in favour of the principal. Thus, if he improperly mixes the principal's property with his own all that he cannot show to be his own will be presumed to belong to the principal."

(Halsbury's Laws of England, 3rd Edn. Vol. 1 p.186.)

If these principles were to be strictly enforced it would be difficult for the plaintiff to get much relief from this Court at all. He himself admits that the cost of the materials claimed by him is based not on what he actually spent but on the basis of $12.50 per square foot, a formula suggested to him by some builder. I am satisfied that much of this claim is based on similar estimates.

Mr. Ramrakha, on the other hand, submits that this was a dealing between two brothers based at the time on mutual trust and on a mutual desire to help each other. I accept that submission and consider it proper that the plaintiff should be entitled to relief if the Court can satisfactorily arrive at an approximate amount which the plaintiff has actually spent on the defendant's house. In this regard I do not accept the plaintiff's evidence that the whole house was completely rebuilt and that all the material used, apart from the corrugated iron, was new. I have considered the evidence of Shiu Lingam and Mahendra Prasad who support the plaintiff in his claim that the whole house was rebuilt from the foundation up and that only new material was used. I am not impressed by that evidence. I prefer and accept the evidence of Dharmendra Sharma who had himself carried out some work on the defendant's house in 1970. He had changed the flooring, joists, posts, some louvres and doors. He had installed a new sink in the kitchen and replaced gutterings and down-pipes. He inspected the house again only recently and found that some of the work he had put into the house was still there. He admits that the entire roof [illegible] some of the posts have been replaced. The flooring that he had installed was still there. Some parts that he had not touched have been replaced.

I also accept the evidence of Tikaram, plaintiff's own witness, that the present roof of the house is built of second-hand corrugated iron and contains several small pieces. I do not accept the evidence that a paid watchman was kept for thirteen months to look after the empty house and some material that might have been there from time to time.

I have referred to the four letters written by the defendant to the plaintiff (Exhibit P5 (a) to (d)) and the two letters (Exhibit D1 and D2) which the plaintiff admits writing to the defendant. These letters make it quite clear that the defendant had limited funds and wanted the work on the house done as cheaply as possible. The plaintiff had in turn assured him that he was doing just that and had even stated that he would be getting the work on the house done almost at half the normal cost. I am satisfied that some of the old material was used on the repairs and the rest was purchased here and there by the plaintiff at the cheapest possible price. He strikes me as being a shrewd and able businessman and he no doubt kept the expenses as low as possible. He certainly did not keep any proper account of exactly what material was used on the defendant's house.

The relationship which existed between the brothers in 1973 and 1974 did not last. According to the defendant, Suresh stayed with him for only two years and for the last two years or so plaintiff has been demanding to be reimbursed for the work done on the defendant's house. He, however, has no accounts or other documentary evidence to support the itemised claim that he has presented. What he now demands is the full cost of constructing a new house of this size in 1974. Mr. Ramrakha has introduced evidence to suggest that a wood and iron house today would cost $14 per square foot and that the defendant's house is 897 square feet in area. He has also drawn the Court's attention to the last page of the defendant's notebook (Exhibit P11) where the defendant has in his own handwriting scribbled "897 sq. feet, $13,185". He invites the Court to draw the inference that in defendant's own calculation this is the value of the house and that the plaintiff should be entitled to at least that amount. The defendant cannot say why and when he scribbled this note in his notebook. There is, however, considerable evidence to show that several attempts have been made by family members of the two parties to settle this dispute and I have no doubt that all kinds of formulas may have been suggested. This Court's duty, however, is to ascertain, so far as possible, what the plaintiff actually spent on the defendant's house in accordance with the mutual agreement between them.

Some idea of this mutual agreement, and defendant's directions to plaintiff, can be obtained from the letters I have referred to. Several other letters have also been put in by the defendant as having been received by him from the plaintiff. Plaintiff, however, denies that they were written by him, or by anyone at his request.

The first two letters (D1 and D2) were put to the plaintiff at the end of the first day of trial. He admitted writing them to the defendant. Court then adjourned to next day. These other letters were put to the plaintiff the next morning when the Court reassembled. These letters bear Fiji post mark; the sender's name and address are the same as that of the plaintiff. Plaintiff, however, denies that they w ere in his handwriting. Defendant who grew up with the plaintiff and went to school with him swears that these letters are in plaintiff's handwriting and that he in fact received them at his address in London. These letters were received in evidence as letters received by defendant. Mr. Ramrakha submits that, unless the handwriting is proved conclusively as that of plaintiff's, it would be wrong to, take any account of their contents. Be it as it may, I do not consider it necessary to decide if I am satisfied that the letters are in plaintiff's handwriting. In coming to my decision I have disregarded them altogether. I have only taken into account the two letters that, according to his own admission, were written by the plaintiff and the defendant's letters put in by agreement.

The letter which I consider particularly significant is the one written by the plaintiff on 20th April 1974 (Exhibit D2). By that time most of the work on the house had been completed. The labour contractor, according to plaintiff's own evidence, had been paid off on 4th February 1974 upon completion of the house (Exhibit P9). The letter in question (Exhibit D2) was written at a time when considerable mutual trust and goodwill, existed between the brothers and the present dispute could not possibly have been in either's contemplation. It seems that all that plaintiff wanted at that time was sufficient money to ensure that he himself would not be out of pocket when all the work had been finally completed. The relevant part of the letter is as follows:

"The main job on the house is left, (1) new wirings, $250, (2) Pluming and new water pipes, (3) sending the floorings, and floor polsing. Last month I have complited the porch. Please brother to avoid all the troubles from Incom tax, and to complite all the balance work. Please send the money as soon as possible? If they will ask me about the house, I will just say I have used all the old and some new timber and old roofing Iron and pay very little to friends who help me to build your house. So far you have send 12 payments of £20 equal to F$37.60c total $445, and K. Leo $532.20 full total $976. Please think twice I spend over $2,500, paid cash to carpenter and labour you must reliase that the house cost you almost half prise because the building cost is gone double. You might think that I am pulling your leg. You can ask K. Leo he have seen the house how I have complite the house A to Z. I need another 800 to $1000 to complite the building.

Brother in your letter you said that I arrange to send you two thousand pounds. So please you can see that the two thousand is not enough. Please send 3 1/2 thousand pounds it equal to $6000 in Fiji. I know that you are looking after my son. Spending money on him, please take full care of him, and tell him not to smoke."

I am satisfied that this letter gives a correct picture of the situation at that date. Labour and material had been all paid for. Only $800 to $1,000 was needed to complete the three "main jobs" still left to be done. If the defendant sent only 2,000 (sterling), it would not be sufficient to cover the expenditure already incurred together with the projected expenditure of $800 to $1,000. If, however, the defendant sent £3,500 (sterling) or $6,000 (Fiji) that would just about cover it. I am satisfied there was never any question of supervision charges or travelling expenses. Defendant was looking after Suresh and plaintiff was helping the defendant by getting the house done as cheaply as possible. Plaintiff, however, was anxious to recover the money that he had actually spent on the house out of his own pocket. This is what I hold to have been in the contemplation of both the parties when the work was undertaken and when the work was completed. Nothing could make it clearer than the plaintiff's claim -

"You must realise that the house cost you almost half prise, because the building cost is gone double."

According to the evidence that Mr. Ramrakha himself extracted from Ala Khnath, a witness for the defendant who has been a carpenter for 25 years, a wood and iron house today would cost $14 per square foot. Defendant's house is 897 square feet. A new house of that size would, according to this evidence, cost $12,558 today. Work on the defendant's house, however, was done four years ago and, as I have held, the house is not a new house. I am, therefore, quite satisfied that when plaintiff was asking for $6,000 on 20th April 1974 he had taken into account all the money he had already spent, or expected to spend, on the house. At that price the work was quite cheap, but that, in my view, was the whole intention of the parties. By that date the plaintiff had already received $976 from the defendant.

In addition to this, eleven items on the statement have been agreed between the parties. The total of these is $862.95.

I have already held that water-piping, plumbing, electric wiring, sanding and varnishing were all included in the $6,000 requested by the plaintiff in his letter of 20th April 1974. I disallow plaintiff's claim in respect of new toilet cistern and new steel sink. If he purchased them from Millers', as he claims, he should be able to produce evidence of the purchase. I am convinced he did not send any documents at all to the defendant. According to Dharmendra Sharma a new sink had already been installed in the kitchen in 1970.

The other items are such as much have been either completed, or taken into account, when the letter of 20th April 1974 was written. That letter does refer to a watchman but says nothing about any money, additional to $6,000, which would be required to pay him separately. I have no doubt that whatever was paid to him must have been included in the "cost of carpenters and labour" to which the letter refers.

I have declined to accept Mr. Pillai’s submission that, in the absence of accounts and documentary evidence, the plaintiff's claim, except for the three documents produced by him, should be dismissed outright. Neither have I accepted Mr. Ramrakha's submission that, in the absence of accounts and documentary evidence, plaintiff should be given the full construction cost of the house calculated at $14 or $15 per square foot. Neither approach will do justice as neither was in either party's contemplation when the work was done.

I am satisfied that the relationship between the brothers has now become deeply embittered and the claim by the plaintiff is grossly inflated. I take a very poor view of his witnesses, particularly Shiu Lingam and Mahendra Prasad. Plaintiff is, in my view, entitled to only what he in fact spent on the work done to the defendant's house together with the items not in dispute.

It. was the plaintiff who in his letter dated 12th October 1972 (Exhibit D1) had suggested that defendant should effect repairs and improvement to his property. Defendant who had limited funds for this purpose sought plaintiff's help in keeping the costs down. The work was carried out on this basis and the plaintiff did keep the costs remarkably low. The very fact that the work took 13 months instead of two to three that it should have indicates the nature of understanding between brothers.

It would be wrong, in my view, to deprive the plaintiff of the money which he has spent on the work on the assurance that he would be reimbursed: It would, however, be equally wrong to require the defendant to pay any more than the money actually so spent.

Doing the best I can, I place this amount at $6,000 plus $862.95 which is the total of the agreed items. In calculating this amount I have excluded $976 which, according to the plaintiff's letter of 20th April 1974, he had already received by that date or the cost of repairs would have been placed at $6,976 instead of $6,000.

From the amount of $6,862.95 must be deducted the money the plaintiff has received after April 1974 and the rents plaintiff has collected on defendant's behalf from December 1974 until April 1976.

I accept the defendant's evidence as to remittances made by him from London. From 20th May 1974 until August 1974 the plaintiff sent a total of $242.90. The plaintiff has collected $1,550 in rent. This makes a total of $11,792.90 to be deducted from $6,862.95.

Plaintiff is, therefore, entitled to $5,070.05.

There will be judgment in his favour in that sum. He will also have the costs of this action to be taxed if not agreed.

(G. Mishra)
JUDGE

Suva,
17th November 1978