International Produce Ltd v Ha'ama Growers Ltd [2000] TOSC 37; C 0938 2000 (1 November 2000)

IN THE SUPREME COURT OF TONGA
CIVIL JURISDICTION
NUKU'ALFOA REGISTRY

NO. C.938/00

BETWEEN:

INTERNATIONAL PRODUCE LIMITED
Plaintiff

AND:

HA'AMO GROWERS LTD
Defendant

BEFORE THE HON. CHIEF JUSTICE WARD IN CHAMBERS

Counsel: Mr Garret for Plaintiff/Applicant
Mr Niu for Defendant/Respondent

Date of Hearing: 26 and 30 October 2000
Date of Ruling: 1 November 2000

RULING

The plaintiff in this case is a New Zealand based company carrying on business as an international produce trader. The defendant is a Tongan company supplying agricultural produce. One of the main products it supplies is squash pumpkins for the Japanese market.

In May of this year, the parties entered into an agreement whereby the defendant was to supply and the plaintiff was to market a minimum of 3,000 tonnes of squash during the season. The plaintiff, in pursuance of the agreement, has advanced money to the defendant for, inter alia, the supply of seed.

In August 2000, the parties further agreed that the total amount of squash should be shipped in specified quantities on named vessels for transport to Japan. Two of the four shipments have gone. On both the defendant under-supplied the plaintiff by substantial amounts.

The plaintiff has already made agreements with customers in Japan on the basis of the quantities the defendant had agreed to supply and the shortfall will result in him failing to honour those agreements. The consequences are, the plaintiff claims, difficult to assess and will inevitably result in court action in Japan.

Before the second vessel left, the plaintiff sought an interim injunction to prevent the defendant from supplying squash to any other person until the plaintiff's quota was filled and that the documents of title to the agreed amount should be supplied to the plaintiff.

I adjourned the application in order to list it inter partes. I have been supplied with a number of affidavits and also other information that has been presented by counsel during argument and by letters and Emails. At the adjourned hearing, the injunction was varied to seek the allocation only of a set quantity of squash on the vessel.

It is clear that the defendant has agreements to supply three other companies in addition to the plaintiff and the cargo on the second vessel is committed to all four. The squash season has not been as productive as was anticipated earlier and the defendant has less than he requires, so he is proposing to allocate the squash to each of its customers pro rata to the total promised in each case. That is opposed by the plaintiff as a breach of the contract between it and the defendant.

It is also clear that any order the court might make will affect the defendant's agreements with other companies who are presumably likely to suffer the same consequences of under-supply that the defendant anticipates. I do not consider it would be proper to make an interim order that could affect them without giving them an opportunity to be heard. However that does not arise.

It is only too apparent that there are substantial disputes of fact over the terms and effect of the contract between the parties in this action and the various oral or written variations or additions to it and as to the source of the squash in relation to the seed supplied by the plaintiff.

Those are matters that must await the trial for resolution. In such circumstances an interim order is inappropriate and should not be made. Should a breach of contract be proved, the plaintiff's remedy will properly lie in damages.

The application is refused. Mr Niu for the defendant seeks his costs. It was his client's undisputed failure to meet the agreed quantities on this and the previous ship that led to this application. The costs of this application shall be in the cause.

NUKU'ALOFA: 27^th October, 2000

CHIEF JUSTICE