Kakiaman v Oppeheimer [2009] KICA 16; Civil Appeal 14 of 2009 (26 August 2009)

IN THE KIRIBATI COURT OF APPEAL
CIVIL JURISDICTION
HELD AT BETIO
KIRIBATI

Civil Appeal No 14 of 2009

BETWEEN:

MELESIA KAKIAMAN trading on behalf of MACKENZIE TARATIERU TRADING
Appellant

AND:

SEAN OPPEHEIMER trading as CAPPELLE & PARTNER
Respondent

Before: Hardie Boys JA
Tompkins JA
Fisher JA

Counsel: Sr Bernadette Eberi for appellant
Banuera Berina for respondent

Date of Hearing: 21 August 2009
Date of Judgment: 26 August 2009

JUDGMENT OF THE COURT

The claim

[1] In this rather confusing case the Chief Justice held Nei Melesia Kakiaman liable for $43,457.94 in respect of goods sold and delivered by the respondent. Even the name under which the respondent sued was confusing, as it is an incorporated company, but no point was taken of that at the trial. Much more confusing was the description of the defendant: "Melesia Kakiaman trading as Melesia Trading sued on her own behalf and on behalf of Mackenzie Taratieru trading as Mackenzie Trading." "Melesia Trading" and "Mackenzie Trading" are business names, not incorporated companies, and so in reality Nei Melesia was sued personally. Mackenzie himself was not a party.

[2] The essence of the case is found in these paragraphs of the statement of claim:

2. The defendant is a businesswoman who trades under the name Melesia Trading and she is now sued on her own behalf and on behalf of her son Mackenzie Taratieru who used to trade from Eita Tarawa under the name Mackenzie Trading.

3. By invoice numbers 190 and 252 the Plaintiff sold and delivered to Mackenzie Trading goods valued at $43,457.94 on or about February 15th 2008.

4. Due to problems with Customs Division in Kiribati Mackenzie Taratieru left the country and his business operation was taken over by his mother Melesia Kakiaman, the defendant, who started trading under the name Melesia Trading and continued trading with the goods belonging to Mackenzie Trading and also collected the debts owed to Mackenzie Trading.

[3] The second limb of the claim against Nei Melesia can be disposed of immediately. Even if she were the agent of Mackenzie, she cannot be held liable for debts incurred by him in his business. The case therefore turns on whether the debt to the respondent was incurred by Nei Melesia.

The evidence

[4] There were three witnesses, Mr. Mohammed Yasin, a manager of the respondent, a company operating from Nauru, Nei Melesia and her daughter Nei Tebwea William; and there was also some documentary evidence, mostly produced by Mr. Yasin.

[5] Mr. Yasin said that his company did not have dealings with Melesia Trading but with Mackenzie as owner of Mackenzie Trading. He produced his company’s statement of account, addressed to Mackenzie Taratieru and Pacific Occidental (KI) Ltd (the latter was not an incorporated company but a name under which Mackenzie traded in Tarawa.) He explained that the claim is in respect of two consignments of goods sent to Mackenzie when he was in Tarawa. The invoice for the first is dated 22 November 2007 and is for $32,628.24, of which $2,235.76 was paid through the Bank of New Zealand on 15 February 2008. The invoice for the second consignment is dated 14 January 2008 and is for $10,839.70, thus resulting in the sum claimed, $43,457.94.

[6] The course of dealing disclosed by the statement goes back to early 2001, and shows that before these two consignments were invoiced Mackenzie owed $78,119.24 and that this was reduced by two payments of $29,980 each on 18 December and 7 January 2008 by "Pacific and Occidental" and one of $20,395 on 15 February 2008 by Tebwea William. There was a problem with the second consignment. It was seized by Customs for non-payment of duty.

[7] Mr. Yasin said he came to Kiribati in February 2008 and found out from Customs that Mackenzie was out of the country. Then on 26 February 2008 Mackenzie sent an e-mail to the respondent, asking for confirmation that it had "received the funds into the account", placing another order, and advising that "I’ve changed my company’s names. For Kiribati Melesia Trading, PO Box etc. etc. For Tuvalu Mackenzie Trading. Email still the same". In July Mr. Yasin went to Tuvalu and found that Mackenzie was doing business there.

[8] Nei Melesia’s evidence is difficult to follow, although she was clear in her denial that she had anything to do with the business. She said the debt was Mackenzie’s. She said her daughter Tebwea used to work for Mackenzie at Pacific Occidental, that although she did not know the exact details, Mackenzie and Tebwea decided that he would go to Tuvalu to start a business there and that Tebwea would take over the business in Kiribati. She said she gave each of them $10,000 to start their businesses. But she made some comments that suggested there was more to the business relationship than she claimed. For example, when challenged in cross-examination about this gift she said "You were not there beside me because I had already been thinking of planning a business"; and, being shown the statement of account, she said: "If some here but we run our own business. Maybe some of Cappelle’s good are among us but we ordered from Australia, Hong Kong, my own money."

[9] Then on being shown the e-mail referring to the change of names, there followed what the Chief Justice described as a spontaneous outburst: "He’s not the boss. I’m the boss." The Chief Justice then said: "You’re the boss" and this followed:

"Yes, I’m the boss. I told him to go and make your business down there and let your sister make business here. That’s it. Run you own business. I know nothing about business. Only you and your sister. Your sister Melesia Trading. You now go and run your business in Tuvalu.

Counsel: So everything that has been done has been done with your knowledge with what you wanted them to do. Is that right?

Melesia: I don’t know.

Court: But you were the boss.

Melesia: Before Mackenzie came here from Nauru to be an agent for Cappelle he asked my permission and I told him OK go and I gave him some money from the chest and told him to get some goods of his own."

[10] Nei Tebwea said that Mackenzie’s business was Pacific Occidental, which had gone bankrupt, and that on 1 January 2008 she started her own business as Melesia Trading using money from her mother and from land Mackenzie had bought. She produced the Certificate of Registration of the name Melesia Trading dated 11 January 2008, showing that the application for it had been made by her. She said she did not know what Mackenzie intended by the change of his name to Melesia Trading. Her cross-examination was directed to obtaining an admission that Melesia Trading was in fact a continuation of Mackenzie’s business, but she insisted that it was her own business and separate from Mackenzie’s. She agreed she had made the last payment to the respondent, but that that had come from Mackenzie’s money.

The High Court Judgment

[11] The Chief Justice said that he "was not much impressed by the two ladies and [I] do not rely on their denials of liability." He preferred Nei Melesia’s spontaneous outburst to the denial. "After the outburst I have no doubt that Nei Melesia is in charge of the business." He saw considerable significance in the e-mail which "shews an intention for a continuing business relationship although the name of the business is changed." And later: "This is the same business under a new name". He concluded that Nei Melesia and Mackenzie were liable for the amount claimed, and as the former had been sued on her own behalf and on behalf of Mackenzie he gave judgment against her - alone.

The Appeal

[12] The single ground of appeal set out in the notice of appeal was that the Chief Justice "erred in law and in fact in allowing the Applicant/Appellant to be sued in the matter when Applicant/Appellant was not of such entity which has no trading involvement with the Respondent." However two further grounds were later added. The first was that the Chief Justice erred in law and in fact in misinterpreting Nei Melesia’s outburst and concluding from it that she was liable, as there was no evidence proving any business connection between her and the respondent. The second was that the Chief Justice failed to take into consideration Nei Tebwea’s evidence that she was the legal proprietor of Melesia Trading.

[13] In his written submissions Mr. Berina for the respondent made two significant observations. The first was that his client’s case was that Melesia Trading was in fact a business enterprise owned by Mackenzie Taratieru. The second was that the Chief Justice had made a finding of fact that this was indeed the case. He supported that finding. But of course the Chief Justice’s finding was that Nei Melesia owned the business. We note too that Mr Berina made his position clear from the beginning of the case. In his opening statement in the High Court, he told the Chief Justice that "Melesia and Mackenzie are one and the same business, just different name but Mackenzie owns them all." And then in this Court, Mr Berina said that he accepted that the business was Mackenzie’s; that Melesia Trading was Mackenzie’s business.

Conclusions

[14] It is trite law that only in exceptional circumstances will an appellate court differ from a conclusion based on an assessment of the credibility of witnesses. But on an analysis of the evidence credibility is only a side issue in this case. The evidence of Mr. Yasin, supported by the statement of account he produced, is quite clear. His company dealt with Mackenzie, and the debt upon which its claim is based was incurred by Mackenzie. As Mr. Berina acknowledged, the purpose of the proceedings was to recover the debt from Mackenzie.

[15] Probably because Mackenzie was in Tuvalu, and because of the name "Melesia Trading" that Mackenzie gave in his e-mail, the respondent chose to sue not only Mackenzie but also Nei Melesia on the basis that she traded under the name of Melesia Trading. This confused matters. Mr. Berina’s statements referred to above are quite inconsistent with it. And he led no evidence to show that Nei Melesia had any dealings with the respondent.

[16] That the Chief Justice held Nei Melesia personally liable resulted we suspect from the fact that the focus of the case shifted from the respondent’s dealings with Mackenzie to Nei Melesia’s outburst "I am the boss". The Chief Justice construed these words as an acknowledgment that she was the owner of (or at least a partner in) Mackenzie Trading, and he judged all else she said, and assessed Nei Tebwea’s credibility too, against that construction. There is however an equally likely meaning to her words. When one looks at what followed the outburst, it is quite likely that she meant that she told her son and her daughter what they should do, and they did it, and in that respect she was indeed "the boss." Taken in the context of her denials and the respondent’s evidence it is a very tenuous basis for a conclusion that it was an admission of ownership of Mackenzie Trading. The same is true of her other remarks quoted in paragraph [8] above.

[17] The e-mail sent by McKenzie does not help the case against Nei Melesia. It is, as the Chief Justice observed, evidence of a continuing business relationship, but not of one in which Nei Melesia was involved. Instead it shows that Mackenzie was continuing in business in Tarawa under the new name of Melesia Trading, and that he continued to have an interest in the business that Nei Tebwea claimed was hers. Not only does it not implicate Nei Melesia, but it is the first time that that business name appears in the dealings between the respondent and Mackenzie. By this time the debt had been incurred. The fact that Nei Tebwea made the final payment to the respondent does not advance the case against the appellant either.

[18] It would have been better for the appellant’s case if the ladies had not given evidence at all, for their evidence only confused matters, and brought about an examination of family dealings that led the Chief Justice to reach a conclusion that the respondent had not propounded and that its evidence did not support.

[19] For these reasons we are satisfied that the appeal must be allowed. The judgment in the High Court is set aside, and in its place there will be judgment for the defendant in that Court, with costs in that Court to be agreed or fixed by the Registrar. The appellant is entitled to the costs of the appeal to this Court, the amount again to be agreed or failing agreement to be determined by the Registrar.

Hardie Boys JA
Tompkins JA
Fisher JA