Vanuatu National Provident Fund Board v Matariki [2002] VUCA 5; Civil Appeal Case 02 of 2002 (26 April 2002)

IN THE COURT OF APPEAL OF

THE REPUBLIC OF VANUATU

(Appellate Jurisdiction)

Civil Appeal Case No.02 of 2002

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BETWEEN:

VANUATU NATIONAL PROVIDENT FUNRD

Appellant

AND:

WINNIE MATARIKI AND DANIEL PHILIPS

Respondents

Coram: Hon. Justice John von Doussa

Hon. Justice Bruce Robertson

Hon. Justice Daniel Fatiaki

class="MsoNoMsoNormal" style="text-align: justify; margin-top: 1; margin-bottom: 1"> Counsels: Mrs. Loa Damena-Tepai for the Appellant

Mr. Robert Sugden for the Respondent

Hearing date: 24th April 2002

Judgment date: 26th April 2002

JUDGMENT

This appeal arises from a claim for damages for the nversion of the respondent’s “tools of trade”” which were seized by the appellant when it re-entered into premises in which the respondent carried on her professional practice as a physiotherapist. The lessee of the premises was Medic International Limited of which the principal was one Michael Roland-Evans.

It is now accepted that in or abeptember 2000 Medic International was in breach of some of its obligations under the the lease. It is common ground that on 5^th September 2000 the respondent re-entered the premises by locking it up and posting security guards to prevent access into the premises.

Prior to this event the reent had operated out of the leased premises but with the re-entry the respondent’s pr’s practice effectively ceased. The respondent unsuccessfully sought the release of her “tools of trade” over several months and eventually was obliged to replace them in order to continue her professional practice.

The respondent sought compensatir what she claims was an unlawful conversion by the appellant of her “tools of s of trade”. The appellant for its part refused to release the “tools of trade” in the absence of proof of ownership being furnished by the respondent.

The respondent issued proceedings in the Magistrate’s Court to recover her “tools of trade”, however after acquiring replacements the claim changed to one seeking the value of the “tools of trade” and consequential damages in a sum beyond the jurisdiction of the Magistrate’s Court.

An amended statement of claim was accgly filed in the Supreme Court together with detailedailed particulars of loss sustained by the respondent as a direct result of the appellant’s seizure and retention of her “tools in trade” and her efforts thereafter in obtaining finance and acquiring replacements.

In its defence to the respondent’s amended claim, save for admitting that it ‘’, the appellant denied the allegations.

After pre-trial matter which includedfiling of affidavits and interrogatories were completmpleted, the trial commenced before Coventry J. The learned trial judge dealt fully with the evidence led before him and made several crucial findings. He accepted the evidence of the respondents whom he found to be “honest and reliable” and found as a fact that:

“There was an agreement between Mrs. Matariki and Medic wheredic purchased the physiotheiotherapy equipment for her to obtain favourable discounts. She has commenced repayment to Medic. When the premises were seized on 5^th September 2000, she was entitled to immediate possession of the items and was refused it by the Board.”

class="MsoBoMsoBodyText" style="line-height: normal; margin-top: 1; margin-bottom: 1"> Further“… such was the length of the withholding of possession that she ha no alternative but to obtain replacement equipment.”

The learned trial judge awarded the respondent the various sums which are clearly set out in the judgment including:

“(1) The replacement value of the equipment: VT325,096n/spa><

&nb) Losprofits (05.09.00 to 31. 01. 011. 01): ): & nbsp; &nbp; &nbsp &nbsp &nbssp; &&nsp;; Vsp; VT865,938 and and

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Execution by the respondent was stayed however on a sum equal to the balance purchase price owed to Medic in the lthe light of a judgment obtained by the appellant against Medic for the arrears of rental owed on the leased premises which exceeded the balance purchase price.

The appellant appeals against tdgment on the following grounds:

“1. In failing to find:

(a)&t;"> &nnsp;&&nsp;; sp jpan>judgment for the Appellant;

(bB">(b) & &nnsp;&&nbp;;&nbp; &nbp; there was no e no evidence for show that Mrs. Matariki hid fo thsioth equi; (c) &nbssp; &nbssp; &nbp; ; thet thelAppellant was not privy to the arrangement bn thet spondn Dr.s andedic natioimited;

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(d)  p;&nssp;  p; &nbp; &nbp;

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2. In finding:

(a) &nnsp;&&nsp;;&nspp;&nssp;&nsp; that Mat.riki riki had paid for the physiotherapy equipment;

(b) &nnsp;&&nsp;;&nspp;&nssp; sp; that Mrs. Matariki was entitled to immediate possession of the physiotherapy equipment but refused it by the Appellant;

(c)  p; &nsp; &nbbsp; span>that thet the AppelAppellant and/or their lawyers should have filed inter-pleader applications;

(d) ; &nnsp;&&nsp;;&nbp; &nbp; /s for the Respondentsdents relying on the evidence of a black file of documents containing proof of payments of the physiotherapy equipment even though no mention was made to tpellaom thset; span><

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(e) &nbbsp;& &nsp; &nsp; &nnbp;& /span>that thet the AmendAmended Statement of Claim groua cau action.

3. In awarding damages for the Respondents.

lass="Mss="MsoNormal" style="text-align: justify; margin-left: 36.0pt; margin-top: 1; margin-bottom: 1"> (b) alternatively, in wrongly exercising his discretion.”

There was no appeal against the heads or amount of damages awarded or thts order made by the learneearned trial judge.

class="MsoNoMsoNormal" style="text-align: justify; margin-top: 1; margin-bottom: 1"> We are grateful to both counsel for their written and oral submissions. In b counsel for the appellant lant challenges the learned trial judge’s conclusion that the appellant had converted the respondents “tools of trade”.

In particular counsel challenged the learned trial judge’s finding that the respondes entitled to immediate pose possession of the seized items in the absence of any right in the appellant to claim possession or ownership of the goods on the leased premises. A good deal of counsel’s written and oral submissions was also devoted to highlighting the paucity of the respondent’s evidence of her ownership of the items.

After careful considerationre constrained to dismiss the appeal for the following reasons:

(1) &bsp; &nbbp;&nnbsp; &nbbsp; Than>The tort of conversion is conveniently described in Salmond on Torts (16^th Ed.) at pp 96-97 aspan>< “an act (or compleacts) of wilful interference, without lawful justifictification, with any chattel in a manner inconsistent with the right of another, whereby the other is deprived of the use and possession of it. Two elements are combined in such interference: (1) a dealing with the chattel in a manner inconsistent with the right of the person entitled to it, and (2) an intention in so doing to deny that person’s right …”

And later the following passage occurs under the hearing :

“Although a conversion is necessarily an intentional wit need not be knowingly wrly wrongful. A mistake of law or fact is no defence to anyone who intentionally interferes with a chattel in a manner inconsistent with the right of another. He does so suo periculo and taken the risk of the existence of a sufficient lawful justification for the act; and if it turns out that there is no justification, he is just as responsible in an action of conversion as if he had fraudulently misappropriated the property. Persons deal with the property in chattels or exercise acts of ownership over them at their peril.”

In the present case it is undisputed thathe 5^th of September 2000 when the athe appellant re-entered and locked up the leased premises there were numerous chattels and other items on the premises including the “tools of trade” that the respondent claimed as hers and for which she had sought their immediate release.

That such an action by the appellant constituted a deate interference with the possessory right of the respondenondent over her “tools of trade” is beyond dispute.

What is vigorously disputed however is the existence of any intention on the appellant’s part to deny the respondent’s claim to ownership of the goods or to deal with them in a manner inconsistent with the respondent’s rights.

In this regard the learned trial judge found that ‘when the premises were seized on 5^th September 2000 (the respondent) was entitled to immediate possession of the items and was refused it by the Board’.

That was a finding that the learned trial judge was plainly led to make on the evidence before him in the case. This is included

(1) nbsp; &nbbp;&nnbp;& &nbbsp; p; the oral testimony of the respondent’s husband that he had approached the appellant’s representative on 5^thember to rt the release of the “tooi>tools ofls of trade” and was advised to pato pay up the outstanding rental owed by Medic to the appellant and only then would the items be released;

&bsp; ;&nbssp;&nbp; &nsp; ;&nbpp; &nnsp;& sp; than>the letter of the respondent’s counsel dated 29^th September 2span>span "EN-GB"> assethat the respondentndent and and otherothers hads had brou brought into the leased premises. ‘… their own equipment to be use in the provision of services’;

(3)  p; &nbp;&nbp;  p; &nnsp;&&nsp; the averient in the Statement of Claim that the respondent ‘owned and was eed todiateession of the gand in > in the pthe particarticularsulars of l of loss where it states ‘upon the commencement of her practice at VNPF building she (respondent) purchased the equipment … to use in her practice’;

(4) & &nnsp;&&nbp;;&nbp; &nbp; nswer of the athe appellant to interrogatory 2 (ii)h>had ad b been ueen used (sed (by Meby Medic) dic) during the lease and had been claimed to be its properties”;

(5) & p; &nsp; &nsp; ;&nbpp; &n sp; the fact fact that despite receiving an indemnity the ndent the appellant persisted in its demand for ‘satisfactory proof ooof of ownf ownership of all … of the equipment’;

lass="MsoNoMsoNormal" style="text-align: justify; margin-top: 1; margin-bottom: 1"> Finally the sworn oridence of the respondent concerning the arrangement she had made with Medic and the pthe payment she had made towards the purchase price of the “tools of trade” which the learned trial judge specifically accepted in his judgment.

We cannot overlook either the passage in respondent’s counsel’s skeleton submissions provided to this Court which reads:

‘The appellant had obtained judgment against Medic on June 6, 2001 in Supn Supreme Court Civil Case No. 116 of 2000 and was looking at ultimately selling off the items in the premises in order to enforce the judgment and to mitigate its losses. Therefore the appellant had an interest in the chattels by virtue of the judgment in the case to do with Medic’.

Counsel submitted that the appellant was entitled to assume that all the chattels found in the premises when re-entry was effected, belonged to Medic the lessee of the premises and further that the appellant was entitled to make enquiries about the ownership of the chattels that were claimed by the respondent.

Subject to the general rule that the rio bring an action for conversion or wrongful detentioention of goods belongs to the person who can prove that he had, at the time of the conversion, either, actual possession or the immediate right to possess on, it is not necessary to prove a title of absolute ownership (see: Clerk Lindsell on Torts 15^th Ed. Para. 21-42). We accept the general proposition that a conditional refusal to deliver up goods to the true owner by a person who was ignorant of his identity is not ipso facto evidence of a conversion but such a person is required to take positive steps to satisfy himself of the genuineness of a claim of ownership within a reasonable time.

Acngly in our view it is not open to such a person to merely retain possession and pass passively throw the onus of proving ownership upon the claimant without more as occurred in this case.

Needless to say we reject any suggestion that “ownp of goods” can only be establitablished or proved by way of some documentary evidence or that an oral assertion of ownership on oath can never be sufficient in an action for conversion of goods, however credible the claimant may be.

Having said that, the assertion of ownership in this case is not a bare one. It was recorded in letters exchanged between the parties solicitors and, in Court, was accompanied by numerous details about the agreement to purchase the items, about the purchase price and the payment made towards the purchase price, all of which the learned trial judge accepted and found.

In the present case at the very outset and for a week thereafter the respondent had claimnership of her “toolstools of trade” and demanded their return to her. This was flatly refused. Two weeks later by letter dated the 29^th September 2000 the respondent through her solicitors formally demanded the return of her “tools of trade” within 7 days. This was met by a letter from the appellant’s solicitor requesting “proof of ownership”. Several months passed and still the respondent’s “tools of trade” were not released. Court proceedings were then issued to recover the “tools of trade”. There was a further exchange of letters between the parties solicitors with the respondent demanding the return of her “tools of trade” and the appellant maintaining its stance of requiring proof of ownership but this time a further requirement of an indemnity was added by the appellant.

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An indemnity was accordingly furnished by the respondent in a letter wdisclosed that ‘the ethe equipment that is currently locked up was new and sold to (the respondent) by a company called World Medical Inc. when she begun practice in June 2000. She is still paying off the price.’

class="MsoNoMsoNormal" style="text-align: justify; margin-top: 1; margin-bottom: 1"> For the foregoing ns the appeal is dismissed with costs to the respondents.

Dated at Port Vila, this 26^th day of A 2002.

Hon. Justice Daniel Fatiaki

Hon. Justice John von Doussa

Hon. Justice Bruce Robertson