Tom v Heinrich [2012] NRSC 12 (19 June 2012)

IN THE SUPREME COURT
REPUBLIC OF NAURU

Not Restricted

Civil Case No.11 of 2012

Ebeni Tom and Others
Plaintiffs

v

Meine Heinrich and Antonius Heinrich and
1st Defendants

Ace Trading Store
2nd Defendant

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JUDGE:	Eames, C.J.
DATE OF HEARING:	15 June 2012
DATE OF JUDGMENT:	19 June 2012
CASE MAY BE CITED AS:	Ebeni Tom v Heinrich
MEDIUM NEUTRAL CITATION:	[2012] NRSC 12

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CATCHWORDS:
Contract – Oral agreement between elders of two families installation and operation of a petrol bowser on plaintiffs’ land - Parties already operating a store on jointly owned property abutting bowser- Elder and her family members to be entitled to free petrol and goods from store – Defendants inherit business and later deny free goods after unrelated dispute –Whether breach of contract – Whether damages available – UK Limitations Act 1939, s.2.

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APPEARANCES:
For the Plaintiff	Mr V Clodumar (Pleader)
For the 1st and 2nd Defendants	Mr Pres Nimes Ekwona (Pleader)

CHIEF JUSTICE:

1 This is an action for breach of contract. At a time uncertain, but probably before 1991, Veronica Kinago Reweru (nee Agigo) the mother of the first named plaintiff made an arrangement between herself and Pinia Heinrich, the mother of the defendants. The two families are closely related through their grandmothers and the two women were very close friends.
2 Veronica, now deceased, and her family were the owners of land Portion 178. The plaintiffs and defendants share ownership of Portions 179 and 180. On Portions 179 and 180 Pinia ran a store known as Ace Trading Store. At a time not precisely identified, Pinia asked Veronica if she would agree to Pinia installing a petrol bowser at the front of the store, on Portion 178. In his affidavit Jerome Reweru, her son, said that was in 1996, but in evidence he said he learned of the arrangement when he was 15 years old, some 25 years ago.
3 Veronica told her son Jerome, the first plaintiff, that she had agreed to that proposal. In his affidavit, which he adopted in the witness box, Jerome said that his mother informed him that as “part arrangement” for granting Pinia the use of the land Veronica’s family were granted the right to buy on credit foodstuff from the store and put it under the name of Pinia. This included petrol from the bowser. The plaintiff and his family were angry with their mother for making the arrangement with Pinia, but they did nothing to overturn it.
4 After the death of Pinia in 1991 the two defendants took over as proprietors of the store. At some time the business was leased out to a Chinese operator, Mr Achung, who paid rent for operating the store and the petrol bowser. After Pinia died the plaintiff said he went to the store but was denied credit for food or petrol. The defendants told him that the arrangement was finished. In his affidavit Jerome said that Meine Heinrich “Stopped the family from purchasing on credit on the basis that the family has exceeded the value of their land”. Jerome said his mother instructed him to take necessary action “to return the land”. Jerome did nothing in response to that suggestion.
5 Recently, Jerome and the defendants quarrelled over a scrap metal business deal relating to other land and as a result of that argument the plaintiff was given authority by his family to start proceedings to recover Portion 178 and buildings on the land. The plaintiffs put a proposal to the defendants that they would not remove the defendants from portion 178 and would allow them to keep operating the store and bowser if the defendants agreed to the plaintiffs retaining some or all of the rent from the bowser operation. (In his affidavit Jerome Reweru sought payment of $1000 per month, being the total rent for operation of the bowser, but in the prayer for relief in the statement of claim 50% of that rent is sought, $500 per month).
6 The plaintiffs obtained an interim injunction on 23 April 2012 requiring that rental payments from the bowser operation be withheld by Achung from the defendants, pending the outcome of the trial.
7 The evidence concerning the original agreement was extremely vague. In an affidavit, Noel Agigo said the main store was built sometime “in the early to mid-1980s”, and that the bowser was added “some years after”. As I have said, Jerome Reweru gave oral evidence that his mother told him of the arrangement when he was 15 years of age. He is now 40. He said his mother would have him drive to the store for petrol about two or three times a month, getting credit of about $20-30 each time. In addition, about three times a month she would get a free tin of corned beef. His mother told him that she and Pinia would split the rent on the bowser 50/50, but he never saw his mother receive any cash for the bowser operation.
8 He said in his affidavit that on one occasion, some 22 years ago, Pinia gave his mother a Ford GT 351 with a V8 engine. His mother said she did not want it, and gave it to him. She said that although she did not have to pay for the car, she did not want the car but wanted “cash for the petrol bowser”, i.e rent, instead. He did not know whether she said that to Pinia. He said that he had not himself asked for food or petrol credit since 1991. He had heard his mother’s brothers and sisters ask for credit at the bowser but he did not know if they were given credit. He did not say when that was. Although he had heard it said that some members of the family were getting credit at the store he did not know whether than was true. No member of family had told him so, and all family had signed an agreement to take this action.
9 In cross examination he agreed that the two women were very close and that Pinia would give anything to Veronica that she wanted. He agreed that his family had done nothing about their complaint about the broken agreement after his mother died in 2004. Their demand for return of the land was not made until 2012, following the argument about scrap metal. In their letter of demand on 23 February 2012 they said they would like “to return our land” but added: “Please, anything that is located on the land or any rents should not be disturbed.”
10 The defendant called no evidence. Mr Ekwona submitted that at its highest there had been a customary social arrangement between close friends that was never intended to be the subject of action in the courts. Insofar as it was a contract claim then any breach occurred well outside the 6 years limitation period for a contract claim.
11 It is difficult to understand the nature of this action.
12 The prayer for relief seeks payment of 50% of the monthly rental of the petrol bowser, or $500 per month, whichever is the higher. If the 1st defendants should not agree to that then the plaintiffs seek approval “to acquire the bowser and operate it as their own business forthwith”.
13 It appears to be an action for breach of contract, but the breach occurred possibly in 1991. No action for that breach commenced within 6 years, thus the claim is well outside the statutory limitation period for a contract claim[1]. In any event, the terms of the contract are so vague as to be incapable of enforcement, or of assessment of damages, even if the action had been brought within time.
14 That is not to say that the plaintiffs can do nothing about the present situation. It may be that the plaintiffs have a right to bring proceedings by way of writ of possession. No such proceedings are before me, nor is there an action for trespass. It may be that the 1st and 2nd defendants remain on the land by way of a tenancy at sufferance[2]. And yet, the plaintiffs want the two businesses to continue, so long as their terms are met.
15 On both sides there are very good reasons why an accommodation should be reached. I suggested that the parties try to compromise their competing claims but there is a degree of animosity arising from other disputes that is preventing good sense prevailing.
16 The outcome of this contract claim will not resolve anything between the parties. I have no doubt that there was a longstanding friendly arrangement between the female elders of the two families, which fell far short of a formal contract. It is a pity that it no longer is valued between the two families, and that they are not willing to create a new contractual arrangement. They will eventually be forced to do so if the plaintiffs seek to enforce their title, on the one hand, but on the other hand seek to have the businesses continue while willing to share profits to that end. The present action, however, is not the answer.
17 The claim in contract is hopeless and the action will be dismissed.
18 I will hear the parties as to the orders they seek.
Geoffrey M Eames AM QC
Chief Justice
19 June 2012

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^[1] s.2 of the UK Limitation Act 1939 as adopted in Nauru and see Halsbury’s Laws of England 3rd Ed, Vol 19,

at page 64.

^[2] See Grund Detabene v Ronphos and Anor [2011] NRSC 8 at [47] per Eames C.J.