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Supreme Court of Vanuatu |
IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)
CIVIL CASE No. 142 of 1996
BETWEEN:
THI THAM GOISET,
C/- P.O. Box 1528, Port-Vila, Vanuatu
Plaintiff
AND:
BLUE WAVE LIMITED,
C/- Navara Store, Kumul Highway, Port-Vila, Vanuatu
First Defendant
AND:
GUY BENARD,
C/- P.O. Box 1435, Port-Vila, Vanuatu
Coram: Chief Justice Vincent Lunabek
Mr. Juris Ozols for the plaintiff
Mr. Garry Blake for the defendants
JUDGMENT
1. Nature of the proceeding
This is a case where the plaintiff alleged to have been contracted by the defendants for her service in assisting the first and second defendants in transferring the registration of a vessel, Kimbe, from Bordeaux, France to Vanuatu registry and in organizing a joint venture fishing project. During that time the plaintiff had incurred various disbursements. The plaintiff claimed from the first and second defendants’ fees for the work and expenses she incurred when she assisted in transferring vessel Kimbe to Vanuatu Registry and establishment of a proposed joint venture fishing projects for the defendants. The plaintiff also claimed from the second defendant advances she gave to the second defendant’s wife and family.
The defendants had made counterclaim for money that have alleged to have been given to and used by the plaintiff and was not accounted for.
2. Relief sought by the plaintiff
The plaintiff’s claims and sought the followings:
(i) The plaintiff claimed all expenses incurred either on behalf of the defendants or at one or another of their requests as itemized in invoice No.0125 dated 25 September 1996 which is in the sum of VT600,575.
(ii) The plaintiff claimed total VT240,517 being cash advances and expenses paid to and incurred on behalf of the defendants Invoice 130 dated 30 September 1996.
(iii) The plaintiff claimed Invoices numbered 0126, 0127, 0128, 0129 dated 25th September 1996 as fees for the various works done by the plaintiff for the defendants which is in the sum of VT3,483,000.
(iv) General total claimed by the plaintiff is VT4,324,092.
3. Relief sought by the second defendant: Counterclaim
The defendants’ cross claim against the plaintiff are as follows:
(a) It is noted that the plaintiff admits that the plaintiff and the first and second defendants agreed to conduct a joint venture regarding a fishing project.
(i) What were the terms and conditions of the joint venture?
(ii) In what capacity did the plaintiff receive VT4,800,000 from Northern Island Stevedoring Company Limited?
(iii) Did the plaintiff have a duty to account to joint venture and/or the second defendant and/or the first defendant in respect of the application of the sum of VT4,800,000?
(b) Did the plaintiff receive from the second defendant:
(i) VT659,700; and
(ii) VT3,854,592.
(c) If so, what were the payments for?
(d) Did the plaintiff breach the terms of the joint venture agreement? If so, what damages was suffered by the second and/or the first defendant?
4. Issues
The issues for this Court to decide on are as follows:
(a) Was there an agreement entered into between the plaintiff and the defendant? If so, when was the agreement made and what were the terms of the agreement?
(b) Did the second defendant contract with the plaintiff for the plaintiff to provide services to the second defendant as a consultant for the purposes specified in paragraph 4-8 of the statement of claim, if so:
(i) what were the terms upon which such services were to be provided;
(ii) what agreement was reached as to how the plaintiff’s services were to be charged for?
(c) Was the plaintiff licensed to provide the services alleged to have been provided for reward? If not, can the fees charged therefore be recovered from the second defendant?
(d) To the extent that the plaintiff was lawfully entitled and licensed to provide services for reward, what were the terms of the agreement pursuant to which such service were provided?
5. Facts
5.1 Undisputed facts
The parties admit to the following:
(a) That there was an agreement between the plaintiff and there first and second defendants for a joint venture regarding a fishing project.
(b) The second defendant Mr. Guy Benard is a shareholder and Director of the first defendant Blue Wave Limited.
5.2 Disputed facts
The following are disputed facts:
(a) The plaintiff alleged that the defendants retained her to assist in the establishment of a joint venture fishing project. In the course of her work she incurred various disbursements and she is entitled for the reimbursement of the expenses.
(b) The defendants denied that they were indebted to the plaintiff. The defendants had a wide-ranging series of counter allegations, which could perhaps be broken to two or three essential elements:
(i) they deny hiring the plaintiff, and if she did work she is not entitled to charge because she had no business licence;
(ii) they deny that she has any reimbursable expenses; and
(iii) they say that she failed to account for some VT4.5 million that Mrs. Benard had given here.
6. Evidence
6.1 Plaintiff
The plaintiff, Mrs. Goiset said that she is a business woman and carry on business as a consultant in Port-Vila, Vanuatu. She said the second defendant’s wife (Mrs. Benard) approached her and told her that she entered Vanuatu on a visitor permit. She told the plaintiff that last time she went to the Immigration Office, they told her that she has one month left to stay as a visitor in Vanuatu. Mr. Benard then asked the plaintiff to assist here to prepare all necessary documents for her to obtain a residency permit, which the plaintiff did and Mrs. Benard obtained her residency permit within 3 weeks.
In the beginning of March 1996, Mrs. Benard informed the plaintiff that her husband (Mr. Benard) wand to set up a project in Vanuatu. She asked the plaintiff to liaise to prepare all documents for her since she is not fluent in English and has no office or even know the country. All fax sent by Mr. Benard (defendant) from Bordeaux, France was typed by the plaintiff and was faxed back to her for her comments and was submitted to the offices concerned.
Since then she was dealing with the second defendant. This regards the transfer and registration of motor vessel Kimbe to the Vanuatu Maritime Registry. The plaintiff incorporated the first defendant (Blue Wave Limited).
In the course of her involvement in assisting the second defendant and his wife to transfer the ship to Vanuatu Registry and setting up the fishing project, the plaintiff said that she incurred various disbursements either at the request of the second defendant’s wife or the defendant himself. The plaintiff lists down those disbursements and marked as:
(i) Annexure “A” disbursements total up to VT2,793,365 which are expenses incurred in respect of obtaining a survey certificate, for the purposes of the transfer of the registration of the vessel to Vanuatu Registry and other expenses incurred by the plaintiff in relation to the motor vessel Kimbe for which she had not been reimbursed by either the first or second defendants.
(ii) Annexure “B” disbursements total up VT240,517 which are advances that were given to the second defendant’s wife, rent of the house for the son of the defendant (Captain) of the ship Kimbe and other at the request of the second defendant for which the plaintiff was not refunded.
(iii) Annexure “C” are series of invoices in the sum of VT3,383,000 in respect of the plaintiff’s fees for services rendered to the first and second defendants in respect of the registration of the vessel Kimbe.
The plaintiff said the Kimbe was registered in Vanuatu under Panama Company called “Bojealla shipping Company Limited”. The second defendant Mr. Benard wanted to transfer the sip to a local company. He instructed the plaintiff to set the company and the plaintiff contracted PITCO because they are representative of Vanuatu Maritime Service. The plaintiff said that at that time there were some legal difficulties and Mr. Robert Bohn who was working at PITCO and Director of Vanuatu Maritime Service at that time asked the plaintiff as to who will sign the document on behalf of the Blue Wave Limited. At that time the plaintiff said that Mrs. Chan Si Lin was with her in the meeting. The plaintiff asked her if they could use her being a Ni-Vanuatu for easier process.
The plaintiff said she accepted with understanding that when the ship arrive in Vanuatu, PITCO will prepare all necessary documents so that she could be discharged.
After preparing necessary documents, the company was set up on 7 May 1996. This is evident from the certificate of incorporation of Blue Wave Limited exhibited “P1”. The Bill of Sale was prepared between Bojealla and Blue Wave Limited and registered with Vanuatu Maritime Authority.
The plaintiff said that she was asked by the second defendant (Mr. Benard) to go to Noumea and contact some officers and checked if there is a bilateral agreement between Vanuatu and New Caledonia, which covers fishing. The plaintiff also said that Mr. Benard asked here to go to Santo and visit Palikolo, to contact Fisheries Department, Ostorm and prepare a feasibility study for him. At that time she said Mr. Benard did not have all funds to set up the project. She said that Mr. Benard asked her to do the feasibility study to enable him to get some funding for the proposed fishing project. She said that Mr. Benard asked her to do the feasibility study to enable him to get some funding for the proposed fishing project. She said that Mr. Benard’s intention at that time was to get funding through Caisse Française de Dévelopement. The proposal was to set up a cooperative of small fishermen, and each fishermen will be funded by Caisse Française de Dévelopement and Blue Wave Limited was supposed to buy all the catching from the fishermen and market them.
The plaintiff said that she prepare the feasibility study to show whether the fishing project is viable or not. This was exhibited as “P2” title “Experimental Small Scale Fisheries for Vanuatu. Development Project for Vanuatu” in the plaintiff’s evidence. The feasibility study paper was carried out at the request and in consultation with Mr. Benard.
After the plaintiff carried out the feasibility study, the second defendant asked the plaintiff to find investors. The plaintiff contacted Sanma Province and NISCOL and they replied positively. They advised the plaintiff that they prepare to invest VT4.8 million in the project. NISCOL then remitted VT4,800,000 to meet the last expenses of the vessel Kimbe. The plaintiff said she had advised Mr. Benard of the sum.
The plaintiff said after meeting with the NISCOL the second defendant asked her to go over to Bordeaux in France in France to see him and the ship, which she did. When she arrived there she visited the ship and asked Mr. Benard why the ship is not living France. She said that Mr. Benard replied saying that people of Bureau Veritas checked the ship and did not issue certificate because they have not receive any payment for it. She said Bureau Veritas is an International Office, which issue certificates to declare that ship is sea worthy and have all safety equipment before they can be sold. Without the certificate the ship cannot be cleared by custom and cannot be sold. The plaintiff said that she then met the manager of Bureau Veritas and made arrangement to pay the certificate.
The plaintiff said she left Bordeaux on 6 June 1996. The ship was still in France. She said she had a discussion with Mr. Benard and explained to him that Mr. De Prene told her that it will take them 2 to 3 weeks to complete the last work on the ship before it can be ready to leave Bordeaux. It will leave around the end of June 1996.
When the plaintiff arrived in Port-Vila, Mrs. Chan Si Lin, Benard’s wife was at the airport. She said Mr. Benard’s wife told her that there were lots of problems in Bordeaux and Mr. Benard decided to arrange for the ship to leave Bordeaux at mid-night.
The plaintiff produced Exhibits “P7”, “P8”, “P9” which are invoices sent to Mrs. Benard. Exhibit “P8” is an invoice about the summary of the expenses the plaintiff incurred in looking after Mrs. Benard’s children when she went to France.
Mr. Jean Goiset is the second witness of the plaintiff. He recalled that in 1996 his wife Mrs. Goiset was in France. He said that around June 1996, Mrs. Chan Si Lin had asked him to keep a sum of VT3,800,000 in a safe in his house. He said the reason for her to give the money to him was because the bank wanted to close her account. He said that the money was in an envelope and that every time she can to him to take money. He said that she took the money and the envelope.
6.2 Defendant
The second defendant, Mr. Guy Benard stated that he arrived in Vanuatu on 11 July 1996.
Mr. Benard is a sailor and captain in Deep-Sea Vessels. He said he has a degree certificate and radio expert registered in the United Nations since 1996 in the field of fishing development.
Mr. Benard said he came to Vanuatu for a reason. He said he came to start a fishing project where ni-Vanuatu would be involved. He said the first contact he started about the project was in 1995.
He said in December 1995, he spoke to local Agence Française de Dévelopement in Paris where he submitted his draft project proposal to operate fishing project in Vanuatu. He later sent a letter dated 19 August 1995 addressed to Agence Française de Dévelopement resident in Port-Vila. The subject of the letter was the proposed fishing project. He explained in the letter the project plan and the financial cost of the project.
Mr. Benard said he had some experience with working with Agence Française de Dévelopement and that they know him in the field of fishing. HE said he had contacted the Vanuatu authorities (legal authorities, Fisheries Department and Immigration Department) from Paris and liaise with the consulate of Vanuatu in Paris at that time.
He said that in December 1995, the Vanuatu Prime Minister invited him to come to Vanuatu. He produced to the Court a letter confirming that invitation.
Mr. Benard said that the discussion by the Agence Française de Dévelopement in Paris about the proposed fishing project and funding was slow at that time. He said in February 1996, he was in France working and his wife sent a fax to him. His wife told him in the fax that she met a nice, wonderful woman in Vanuatu by the name of Thi Tam Goiset the plaintiff in this proceeding. His wife told him that the woman comes from a very powerful family and ready to help everybody in the project.
He said his wife went over to France and arrived in mid October 1995. He then sent his children and wife back to Vanuatu.
Mr. Benard said the contact he had with the plaintiff was by fax. After the fax, he spoke to the plaintiff and told her that he is looking for financial support and a Ni-Vanuatu partner. He said the plaintiff told him that she has a good thing for him and that she has good relationship with the Northern Province Company NISCOL in Vanuatu. He said the plaintiff told him that NISCOL is interest in his proposed project and wanted to involve. He said the plaintiff told him that he must have NISCOL in order to get a licence to operate.
From the nice words of the plaintiff Mr. Benard said he offered her to enter into his project. He said the plaintiff was helping collaborating with NISCOL.
Mr. Benard said the plaintiff went to Bordeaux, France not on his invitation. He also said that there was no agreement between him and the plaintiff as to reimbursement of her ticket and traveling expenses. He said that when the plaintiff arrived in Bordeaux they never talked or had concerned about the proposed project.
In July 1996, Mr. Benard said that there was some incident as the result of the fault by both parties. In mid July 1996 to end of September 1996, he said he did not have any meeting with Mr. and Mrs. Goiset. Meetings he had, he said was the meeting with NISCOL.
Mr. Benard said that the meeting arranged by the plaintiff with NISCOL to which they flew over to Santo to was one in which Mr. Dihn Van Than, Mr. Joh Tari, Mr. William Tari, Mr. Pikioune, Mr. Kalmer Vocor and others were attended. That was around early August 1996. He said when he was in Santo at that time he was shown a place where the project will be situated. He said he had asked the plaintiff to arrange for a second meeting with NISCOL but the plaintiff told him that everything is fine.
Mr. Benard said the plaintiff told him that she was the representative of NISCOL. And that everything she did was for or behalf of NISCOL.
The defendant is a shareholder of the first named defendant, Blue Wave Limited.
Mrs. Chane Si Lin is Mr. Benard’s wife. On Oath she said that she has three children. All her three children suffered asthma and are asthmatic. She said that on 1st March 1996 her daughter Kim suffered asthma. She said her children know what medication to take when they have asthma. She said that they have medication for asthma at home.
Mrs. Chane Si Lin said that she first met a Doctor Buivanlam when she was in Africa. She came to Vanuatu and worked with Doctor Bador in Port-Vila. She said she invites Doctor Buivanlam into her house. She said they always talked about dance and the lady knows lots and she is going to talk about the project.
She said that Doctor Buivanlam was not in Port-Vila in March 1996. She denied that Mrs. Goiset rang her when it was alleged that Kim, her daughter suffered asthma. She also denied having seen invoices for pharmacy dated 6 March 1996 and that every medication alleged by the plaintiff to have been bought by her for her children was not true as she had those at home. She said in March 1996 she was in France and left her three children in Prot-Vila and left medications for them and pock money of VT20,000 to VT30,000 at that time. She told her daughter that the money was for them to buy cake at school.
She also denied that Mr. Blanchet had given Mr. Benard VT200,567 on 15 July 1996 as alleged in Exhibit “P10”. She also denied that she had given VT3,800,000 to Mr. Jean Goiset to keep in his safety. She said that she had given the money to the plaintiff, the plaintiff asked her to close her account with the Bank of Hawaii and open two separate accounts, one for the business and one for the family. She said she trusted her and closes her account as directed by the plaintiff.
Mrs. Chane Si Lin said that she gave the money to the plaintiff at her home and did not remember any grey bag. She denied that the plaintiff ever gave her any cash money. She said she has money at her home.
She said that the plaintiff paid her Unelco bill by cheque but that followed the request by the plaintiff that she gave her cash money and the plaintiff pay the bill in the same amount by cheque. She also denied that the plaintiff paid her food at Au Bon Marché or Better Price.
Mrs. Chane Si Lin also denied that the plaintiff assisted her in obtaining her residency permit. She said she did everything by herself with the Immigration Authority. She said that the plaintiff told her that she knew Mr. Robert Karie who was then Minister of Home Affairs. The only assistance Mrs. Goiset gave was the signing as witness on her paper.
In respect of the excess luggage, Mrs. Chane Si Lin said it was the plaintiff’s luggage (consisting of books and other things) not hers. She said that Mr. Goiset had asked her to carry them for her. She said she had to delay due to the excess luggage despite the assurance from the plaintiff that she knows people at the Air Caledonie. She said that due to the problem caused to her by the excess luggage she was delayed and travelled 2 or 3 days later. She said that when she was delayed the plaintiff had asked her to go and that she will take care of her children and asked for the key of Mrs. Chane Si Lin’s house. The plaintiff also said that she would take care of Mr. Bernard’s fishing project but that had not been done.
When Mr. Benard arrived in Vanuatu and went to the Ministry to find out the document of the project, it was in the name of the plaintiff and he was really angry.
The invoices supporting the plaintiff’s claim are invoices made to the second defendant Mr. Guy Benard. The services done by the plaintiff was at the request of the second defendant or his wife. There is no evidence at all of the first defendant having requested any services or the expenditure of any funds.
In respect of the plaintiff’s claim on the second defendant, there are evidence showing that some expenses incurred by the plaintiff are at the request and for the benefit of the second defendant’s family. There is some evidence showing that the plaintiff personally rendered her service in her personal capacity in assisting the second defendant to transfer the registry of the vessel Kimbe to the Vanuatu Maritime Registry. Whether that assistance was given in return of any fees is not clear from the circumstance of the relationship between the plaintiff and the first defendant company.
As this is a civil case the Court must bear in mind that the standard of proof is on the balance of probabilities. The Court must look at the evidence from both sides and decide whose version is more likely to be believed. The onus of proof here is on the plaintiff.
In assessing the evidence of the parties, the Court finds that most of the plaintiff’s claims were supported by documents. However, some of the plaintiff’s evidence seems to be contradictory.
The Court finds that Mr. Benard and his wife, Mrs. Chane Si Lin, evidences are consistent throughout and at some stage admit liability to some claim advanced by the plaintiff. There is a factual dispute between the plaintiff and the defendants, I believe the defendants.
7. Law
In contract law, when two parties entered into an agreement, the terms and conditions of their agreement bind them.
In contract law, the formation of agreement in absence of express written agreement will in many cases be inferred from the conduct of the parties. Sometimes there may be no identifiable offer and acceptance because the parties have no expressly discussed the formation of the contract but have indicated by their conduct that they did in fact intend to contract[1]. In many cases a more realistic explanation is that by the time a dispute arises, perhaps many of what was said by the parties and yet their conduct is consistent only with the hypothesis that an agreement was in fact made by them[2]. In other cases an express offer has been made which was never expressly accepted or rejected, but the subsequent conduct of the offeree in performing the acts contemplated in the offer indicate his intention to accept[3].
It can be said that there is a binding agreement (offer and acceptance). The defendant’s consent is inferred from the conduct, even though it may be impossible to establish a precise point in time when the offer of the other party was accepted.
In this case, it can be inferred from the conduct of the parties that there was a contract fro the service rendered by the plaintiff to the defendants. This is an established common law principle. However, Vanuatu has the Business Licence Act[4], which regulates persons conducting services for profit such as in this case consultancy business. This Act came into force since 1 January 1984. The relevant provisions of the Act are as follows:
“Business” is defined to mean, “any lawful occupation (other than an occupation specified in schedule 2) carried on for a profit.”
Subsection 2(1) provides “subject to the exemption contained in schedule 2, no person shall carry on a business without a licence issued under this Act”.
Section 2(2) provides “any person (other than a person exempted under schedule 2) who carries on a business without a licence shall be guilty of an offence”. The Act provides for a penalty by way of a fine not exceeding VT500,000 or imprisonment not exceeding 1 year or both.
It is clear that the statutory law in Vanuatu prohibits a person from conducting a business without a licence. In this case, the plaintiff admitted that she did not hold a licence to operate a consultancy business.
The defendants’ counsel submitted that if the business itself is prohibited, then the contract relating to it could not be enforced.
In respect to the expenses incurred by the plaintiff, she is entitled to be reimbursed the invoices of expenses incurred on behalf and for the benefit of the first and second defendants.
It is a general principal of law that a company is a person of its own. The claim made against the first defendant Blue Wave Limited although not a party to original agreement between plaintiff and the second defendant under the principle of privity of contract, it is clear that services provided by the plaintiff is for the benefit and incorporation of the first defendant.
8. Submissions of the parties
8.1 Plaintiff
Mr. Ozols, counsel for the plaintiff at the commencement of the hearing stated that the case is a more straightforward case.
He said the plaintiff claimed expenses incurred on behalf of the defendants and consultation fee for the work done for the defendants. The plaintiff claimed that the defendants to assist in the establishment of a fishing project retained her. She alleged that in carrying the works she was retained to do she had incurred various disbursements and was entitled to various fees as a result of this. The defendants denied that they were indebted to the plaintiff.
The plaintiff’s claim is divided into three parts, which are supported by the documents found at annexure “A”, “B” and “C” to her affidavit.
Annexure “A” are expenses itemized in Invoice 0125 dated 25 September 1996. The plaintiff alleges that these were expenses incurred either on behalf of the defendants or at one or another of their requests and which is entitled to be reimbursed for. These expenses are as follows:
The plaintiff argued that these were disbursements properly incurred by Madam Goiset on behalf of Blue Wave Limited and/or Mr. Benard and she is entitled to reimbursement of the full amount from the defendants.
Annexure “B” is invoice 130 dated 30 September 1996 claiming a total of VT240,517. The expenses are as follows:
Annexure “C” is a bundle of four invoices numbered 0126, 0127, 0128 and 0127 (sic 0129) all dated the 25th September 1996 covering various works done by the plaintiff on behalf of Mr. Benard’s wife and himself and/or Blue Wave Limited in respect of the joint venture or personal matters relating to Mr. Benard and his family.
As to the works done in respect of application for the Residency Permit she charged fix price VT100,000. She charged fee between VT10,000 to VT16,000 as hourly rate for the times she spent works for the defendants. The plaintiff submits that this is a fair and reasonable fee charge compared to any accountant or lawyer in town.
The plaintiff submits that the defendant’s argument that the plaintiff does not entitle to a charge fee for works done by reason of her not having a separate business licence in either of her own name or in the name TPM[5] her husband’s business is wrong in law. If she does not have any licence that renders her liable for prosecution under Business Licence Act[6]. The plaintiff submits that from the evidence it is clear that Mr. & Mrs. Goiset operated all their business together as husband and wife and are entitled to do and the did have a consulting licence in the F9 in the name of TPM which is another business name registered by them. By virtue of that licence the plaintiff and her husband are entitled to carry out general business of consulting and can charge fees.
In respect to the defendant’s counterclaim that the plaintiff is the representative of Niscol and not them is not true as documentary evidence shows that she has done all the work on behalf of Mrs. Benard (Mr. Benard’s wife) and ultimately for the first defendant Blue Wave Limited. This the plaintiff argued that it is clear when she consulted the Finance Minister, when the CDF loan look to be unlikely and fount Niscol as potential joint venture partner with the defendants.
Although the incorporation of Blue Wave Limited was slow and was not done at an appropriate time, it is clear from the evidence that the plaintiff was the key role player behind the incorporation of the company.
In regards to the counterclaim that plaintiff has failed to account for VT4.8 million that she had received from Niscol or the Group the plaintiff submits that there is nothing wrong. As the person introducing the Niscol Group, she has the responsibility to Niscol to ensure that they were going into a proper business venture.
The VT659,700 claimed by the first and second defendants was properly answered by her. She says that she, in accordance with an agreement with the wife of the second defendant drew the cheque in reimbursement of various expenses that she incurred or whilst looking after the Benard’s children while both the parents were overseas. The plaintiff drew that cheque in March 1996 and no query was made in respect of that until September 1996. The plaintiff provides details when requested by the second defendant. The plaintiff submits that Exhibit 9 clearly shows that she expended various monies between 24th February and the end of the following month i.e., the 27th March. She also cash cheque as requested by Mrs. Benard of 30,000 French Francs to pay off school fees, telephone bills and gave back the remaining VT200,000 in late April to Mrs. Benard.
In regards to the second claim of money of the total VT3,854,592 that the defendants claimed was requested from the second defendant’s wife on or about 30 May 1996, was no true. The plaintiff submits that she was in the middle of a three weeks trip overseas when she is supposed to have made this verbal demand.
8.2 Defendant
The defendant argued that three invoices claimed by the plaintiff are addressed to “Monsieur Guy Benard et Madame Chan Si Lin”. Instead of bringing the proceeding against Guy Benard and Madame Chan Si Lin, she brought the action against Guy Benard and Blue Wave Limited. This was argued by the defendant coupled with the plaintiff’s own evidence that her “dealings” were with Mr. Benard, that her “agreement” for services was with Mr. Benard and that she was “engaged” by Mr. Benard to bear out the case for the first defendant, namely that it has no liability whether pleaded or otherwise to the plaintiff.
The defendants submit that evidence in the proceedings only serve to show that Blue Wave Limited, the first defendant had no other role to play than to own the vessel Kimbe. All the works alleged to have been done by the plaintiff are for Mr. Benard. Similarly, allegations related to requests from Mr. Benard were not made in this capacity as an officer of Blue Wave Limited. The importance of the defendants’ arguments is that one cannot ignore well-settled law namely that a company is a separate and distinct legal entity, with separate and distinct legal liabilities from its directors/shareholders. In any event, there was no evidence that Mr. Benard was either a director or a shareholder of the company. In fact the plaintiff was a director at all material time.
In respect to invoices the first invoice annexure “A” was issued by “Goiset Thi” Tam, SDP: Le Daulphin Bleu[7]”. The second and third invoices annexure “B” and “C” are issued by TPM hold a business licence of repair of electronic machines consultant as proof by Exhibit D1, but neither Mrs. Goiset nor Le Daulphin Bleu hold any business licences.
At the relevant time the Business Licence Act[8] which commenced on 1 January 1984 was in force. The relevant provisions of the Act are as follows:
“Business” is defined to mean, “any lawful occupation (other than an occupation specified in schedule 2) carried on for a profit”.
Subsection 2(1) provides:
“Subject to the exemption contained in schedule 2, no person shall carry on a business without a licence issued under this Act”.
Section 2(2) provides:
“Any person (other that a person exempted under schedule 2) who carries on a business without a licence shall be guilty of an offence”.
The Act provide for a penalty by way of a fine not exceeding VT500,000 or imprisonment not exceeding 1 year or both.
It is clear that the law prohibits a person from conducting a business without a licence. The plaintiff admitted that she did not hold a licence.
The defendant submitted that if the business itself is prohibited, then the contract relating to it could not be enforced.
The defendants submit that in any event they were unsuccessful in whole or in part, in relation to the 3 invoices, and the illegality by which they are tainted, the defendants submit as follows in relation to the individual invoices.
First the defendants dispute items in invoice 0125/1096 dated 26/09/96. In respect to air tickets for Vila/Paris/Bordeaux return, the plaintiff said that Mr. Benard denies having ever requested Mr. Goiset’s attendance. The defendants submit that there was no satisfactory reason given for expenditure of VT200,000 for the plaintiff to travel to Bordeaux where it would seem that all she did (on her own evidence) was to arrangement payment of the Veritas account, which was no overdue at that stage as clear from invoice Exhibit P4 and, if she is to be believed, to arrange some supplies for the ship. It is not apparent why her presence in Bordeaux was necessary or would be requested. From Mr. Benard’s evidence he believed that she may have gone over on NISCOL’s behalf to check on the vessel and NISCOL’s proposed joint venture party in Benard himself. She also travels to Gabon from Bordeaux not at the request of Mr. Benard.
The defendants submit that the relationship between the parties at that time was cordial. Mr. Benard described the correspondence between them as sugary. From the defendants’ evidence they said that the plaintiff was passing her self off as a member of one of the most powerful fillies in Vanuatu and said that if she wants to go to Bordeaux that is a matter for her and that she has nothing to hide. She did not mention that the defendants would be liable for expenses if she travels to Bordeaux, France.
In regards to the cash payment to Chan Si Lin of VT150,000 she denied receiving any cash from the plaintiff. The defendants submit that Chan Si Lin is a more credible witness.
In respect to the items purchased for Kimbe there are no supporting documents for those expenses. It is merely the plaintiff’s assertions. Similarly, the defendants deny any liability for flight tickets Vila/Santo/Vila for Vohor/Dihn/Pikioune/Goiset.
For the bill of plumbing and August rent for Stella, it is clear from the evidence that Stella is one of the crewmember’s wife. The defendant’s argued that there is no basis for the assertion by the plaintiff that Mr. Benard is somehow responsible or obliged to guarantee the expenses of his crewmembers and/or their family. This follows from the principle that employer is not legally responsible for his/her employees personal expenses in the absences of the a contractual provision to that effect in the contract of employment, of which there is no evidence. Defendants argued that irrespective of Stella’s situation, if the plaintiff chose to assist that is matter entirely for her. If she felt that it was an obligation on Mr. Benard, she should have checked with him first before incurring the expenses. There is no evidence showing to that effect.
In respect of the Telecom bill of VT174,075 the defendants argued that the only evidence was a copy of a receipt from Telecom showing that payment had been made in cash as showed in Exhibit D14. Mrs. Chane Si Lin said that she made the payment in cash through the plaintiff. There is no evidence to prove what month payment and bill was for.
(i) For the flight tickets Vila/Santo/Vila, Mr. Benard accepted his responsibility for the cost of his flight ticket but does not accept his responsibility for the plaintiff’s flight ticket.
(ii) From the above invoices and expenses, Mr. Benard accepts his responsibility for a total amount of VT1919,330 in respect of invoice numbered 0125/1096. Mr. Benard accepts that he (not Blue Wave Limited) may, subject to illegal contract submission, be liable to the plaintiff in respect to that sum on the invoice.
(iii) Secondly, invoice 0130/1096 the defendants submit that they were issued by TPM. They were invoices dated 30 September 1996 and appear to have been issued as an after thought and this is reflected in the items, which appear on them. The financial assistance provided by the plaintiff to the various people had nothing to do with Mr. Benard or the vessel.
In regards to the Unelco bill Mrs. Chane Si Lin explains that she was not able to pa the bill because she was not feel well and arranged to provide cash to the plaintiff whom in turn would send payment of the amount by cheque. From evidence of Mrs Chane Si Lin, the plaintiff was not happy to do the payment as it saved her going to the bank to cash cheques for her daily needs. Further, she said that the plaintiff liked to pay her accounts by cheque so that she had a record.
Thirdly, invoices 126-129/1096, invoices alleged for the professional services provided to Mr. Benard and his wife. The works done for Mr. Benard and his wife and children are done voluntarily. Her travels to Bordeaux and Gabon were travels done voluntarily by the plaintiff not at the request of the defendants. These are clear forms the evidence given by the defendants and the plaintiff herself.
If the plaintiff in reality was providing consultancy service pursuant to an agreement with Mr. Benard, one would have expected that invoices would have been issued on a monthly or quarterly or at least 6 months basis. The defendants argued that the invoices were not provided to Mr. Benard until after the plaintiff’s ex parte application was made.
8.3 Cross Claim
Mr. Benard’s cross claims relates firstly to the VT671,700 that the plaintiff acknowledge receiving but did not provide a proper account for expenses lawfully paid by her out of those funds. Of that sum the second defendant accepts that a total of VT372,878 were properly incurred with proper receipts provided. The second defendant submits that she has failed to properly account for amount of VT298,822 which is claimed by way of counterclaim.
In respect of VT3,800,000 the items which are primarily objected relates to the alleged cash payments on 21 June, 26 June, 5 July, 9 July, 11 July 12 July and 15 July as well as the payment to settle on 3 July 1996. Although there are two conflicting stories as to the circumstances surrounding the use of the money, what is common to both is that VT3.8 million in cash was delivered up to Mrs. Goiset and/or her husband and was place in a safe at Mrs. Goiset’s residence. It would be undeniable that Mrs. Goiset had unlimited access to the money.
The defendants submit that Mrs. Goiset has failed to account for VT996,263 which is amount which is claimed by way of counter claim by the second defendant.
In summary of those money transacted between the parties, the defendants submit that the fallout is as follows:-
Guy Benard owes Thi Tam Goiset VT 1,919,330
Thi Tam Goiset owes Guy Benard VT 1,295,085
__________
TOTAL VT 624,245
==========
The defendants submit that the highest that the plaintiff can claim and take her claim is VT624,245 from Mr. Benard and not Blue Wave Limited.
9. Application of law on the facts as found by the Court
In the present case, the question of the legality of the contract arises both in connection with the formation and performance of it.
There is no specific written agreement made between the plaintiff and the first and second defendants. Most of the works done and expenses incurred by the plaintiff are not at the request of the second defendant or his wife.
The question here is was there a contract for service made between the parties? When was the contract made? And what were the terms of the contract? Was the contract legal and enforceable by the parties?
Although there is no written or oral contract between the parties, from the conducts of the parties, it could be inferred that there was a contract. It could be inferred from the conduct of the parties too that the contract between them was made when the plaintiff and second defendant and his wife correspond with each other and the plaintiff start assisting the second defendant and his wife in transferring of vessel Kimbe to Vanuatu registry and other related works.
The issue for the Court to decide is where a person like the plaintiff here can enforce her right or claim for fees for her service to the defendants when she has no licence to carry on a business of consultancy under the Act of Parliament of Vanuatu.
Under the Business Licence Act[9] of Vanuatu it prohibits any person from conducting business without licence. The Act came into force on 1 January 1984. The relevant provisions of the Act are as follows:
“Business” is defined to mean, “any lawful occupation (other than an occupation specified in schedule 2) carried on for a profit”.
Subsection 2(1) provides:
“Subject to the exemption contained in schedule 2, no person shall carry on a business without a licence issued under this Act”.
Section 2(2) provides:
“Any person (other that a person exempted under schedule 2) who carries on a business without a licence shall be guilty of an offence”.
The Act provide for a penalty by way of a fine not exceeding VT500,000 or imprisonment not exceeding 1 year or both.
It transpires from the evidence before the Court that the plaintiff had voluntarily assisted the second defendant and his family. Although expenses incurred from the assistance provided to the second defendant, the plaintiff did not tell the second defendant that she is a consultant and she would charge the second defendant or his wife fro the work done for them. It also transpires from the evidence that some of the expenses incurred by the plaintiff were not incurred at the request of the second defendant. Most of the expenses were incurred by the plaintiff’s own wish and kindness to the people who she claimed second defendant is responsible for them.
I find that most of the plaintiff’s evidence to the various disbursements she claimed that she is entitled for reimbursement seemed to be contradictory.
It is clear that the law prohibits a person from conducting a business without a licence. The plaintiff admitted that she did not hold a licence.
Therefore, if the business itself is prohibited, then the contract relating to it could not be enforced as was held in the case of George v. Greater Adelaide Land Development Co. Limited[10] where legislation prohibited the offer for sale or sale of certain land and imposed a penalty on any person who contravened the Act. A contract fro sale of certain lots of land was held to illegal and unenforceable because it contravened the Act.
The position has been summarized by Atkin L.J. in Anderson Ltd v. Daniel[11] in a passage which quoted by Devlin J. in St. John Shipping Corporation v. Joseph Rank Ltd[12]:
“The question of illegality in a contract generally arises in connection with its formation, but is may also arise, as it does here, in connection with its performance. In the former case, which is prohibited by Act of Parliament, it is indisputable that the contract is unenforceable by either party. As I thing [sic. Think] that it is equally unenforceable by the offending party where the illegality arises from the fact that the mode of performance adopted by the party performing it is in violation of some statute, even thought the contract as agreed upon between the parties was capable of being performed in a perfectly legal manner.”
I have no difficulty in accepting and adopting that position to be the one to be adopted by this Court.
If an Act of Parliament prohibits a person from conducting business without licence, the Court would not be inferred of the parties that there is valid contract and enforce the rights of the parties therein.
ORDERS
The Court hereby orders that:
DATED at Port-Vila, this 7th day of May 2001
BY THE COURT
Vincent LUNABEK
Chief Justice
[1] Carter, W.J. Harland, J.D. 1991. Contract Law in Australia. Butterworths Pty Ltd, Australia, 2nd At p.21. Also see, e.g. Haynes v. McNeil [1906] WALawRp 51; (1906) 8 WALR 186; Glass v. Pioneer Rubber Wprks of Australia Ltd [1906] VLR 754.
[2] Ibid.
[3] Ibid.
[4] [CAP.173
[5] TPM is an electronic consultancy business operated by the plaintiff’s husband.
[6] Ibid.
[7] SDP: Le Daulphin Bleu is a business name business operated by the plaintiff which does not involve in the business of consultancy.
[8] Ibid.
[9] Ibid.
[10] [1929] 43 CLR 91
[11] [1924] 1 KB 149
[12] [1975] 1 QB 267, 282
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