Petersen v de Sonneville [2009] VUSC 100; Civil Case 172 of 2005 (6 October 2009)

IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

Civil Case No. 172 of 2005

BETWEEN:

JEAN FRANCOIS PETERSEN
Claimant

AND:

SERGIO DE SONNEVILLE AND CATHERINE BERNARD
Defendant

Mr. Stephen for the Claimant
Mr. Hurley and, Mr. Kalmet for the Defendant

DECISION
(ORALLY)

The claimants and the defendant are represented by their respective counsel and I wish to record the competent way in which three counsel dealt with the issue before the Court, The matter has run-over from yesterday but it has been (awaiting) a hearing for some considerable time.

At the conclusion of yesterday’s hearing I suggested that with a little bit of kindness there may yet be resolution, between the parties but that was not achieved.

The background here is that the claimant Petersen was aware of a Mrs. S the previous owner of the property subsequently purchased by the defendants, he was aware that she wished to sell it, and he reached an arrangement with her, that is unchallenged, in that for his efforts he was to receive 8 hectares of land, contained within the property to be sold the subject of his choice. He knew the defendants and began discussions with them concerning purchase, he made a clear arrangement with the defendants that he was to receive the same area of land that is 8 hectares which was the basis of his discussion and arrangement with the original owner.

So the property was identified, the clear arrangement was, that he for his efforts, whether it was as a finders fee or a negotiators fee it does not matter but for his efforts his reward was 8 hectares, of course his efforts needed to result with the previous owner receiving the agreed consideration, the defendants receiving title and in due course he will receive the lease of 8 hectares envisaged.

There is a difference as to the original price but in my view nothing turns on that, it is really the final contract or agreement call it what you will which was agreed between the claimant and the defendants. Nothing here turns on Catherine Bernard being a defendant because it is accepted by all parties that her husband was acting on her behalf.

The contract was agreed and settled, pursuant to that settlement there was a lease registered into the name of the claimant.

The background to the identification of the property related to the claimant and the defendants attending at the road side to view the property and that enabled the claimant to identify from the road way the area of land he wished to acquire. The basis of that agreement is reflected in the letter written by the claimants under the name of the kava Fararua Distribution, Shown as exhibit JFP1 my French is of insufficient quality to readily read that in English but it is signed by Kava Fararua Distribution, Mr. Sergio De Sonneville and Mme Bernard Catherine. It is also signed by the Claimant Jean Francois Paterson, Fait le 31 Janvier 2001 a Port-Vila. Nothing turned on that document other then it being a written confirmation which the claimant rightfully required in respect of the arrangement and it makes it clear within its body 8 hectares within the parcel of land identified ending in the number 018.

The issues that the Court is required to resolve are:

1. What were the term of the contract between the claimant and the defendants,

2. Were there any implied conditions

3. If there were any implied conditions, did they relate to the provision of the access to the whole of land identified by the claimant and of which he became the lessee.

There are many provisions in respect of land but it is summarised in the submissions of the defendants within the decisions referred to therein and in particular William -v- William [2004] VUCA 16 in the Court of Appeal of Vanuatu refer, particularly at page 6 where the Court says particularly at paragraph 3

"Next, counsel for the appellants argued that AHC (Vanuatu) Ltd was not a bona fide purchaser for value as the primary Judge should have held that it had constructive notice of the appellants’ interests. First, he argued that AHV (Vanuatu) Ltd has constructive notice of the presence the land of the appellant because he should have inspected the land, and inspection would have established their presence. Counsel referred the Court to the "Law of Real Property", 5th Edition, by Sir Robert Magarry and H.W.R Wade, at 149. That text speaks to the usual and expected Practice in the United Kingdom for a purchaser to inspect land and make inquiry as to anything which appears inconsistent with the title offered by the vendor.

Circumstances outside of the United Kingdom will be different, and we do not consider that this statement of principle can be automatically applied in this republic. However there is authority in other countries which lends weight to the view that the particular circumstances of a transaction may require the purchaser to make some inquiry, and in those situations, the purchaser will be fixed with knowledge of what would have been ascertained had the inquiry been made.

As we think this appeal must be allowed on other grounds, it is not necessary in this case to explore the circumstances in which constructive notice will attach to a purchaser in Vanuatu who chooses not to carry out an inspection. That is a question best considered when it directly arises in a case, and there is better evidence about the circumstances surrounding the transaction".

The position here is clear, it was at the instigation of the claimant that he identified the portion of land he wished to acquire. There was no suggestion as to boundary points other than an indication that it was to be from the road frontage to the rear as I grasp the evidence.

It is possible to imagine by comparison, a more complex agreement between the parties for example which provided an under taking to the purchasers that is the current defendants to get a minimum number of lots to justify their purchase

Equally the claimant could have stipulated what he required in addition to the 8 hectares to enable him to achieve his purpose.

That in fact is not the position here at all. The defendants elected to purchase the property themselves based upon their judgment and assessment of value and what the property contained.

For his part the claimant identified the land in the manner indicated and agreed followed-up by a sub divisional plan and lease. As I grasp it at no stage prior to the lease did the claimant insist that he would not take title unless there was attached to the land that he was purchasing an additional access right of away or any other arrangement or agreement able to be protected by caveat or caution if necessary to protect that interest.

In my view the claimant has the burden of establishing something more specific which on the evidence before me he is unable to do, the principle of caveat emptor clearly applies here, He was under (in my view) a clear obligation if he, wished to avail himself of any subsequent issue as to quality, access, trees or any other incidental matter to make it clear specifically in the agreement that he reached with the defendants.

The contrast is clear he chose the land by indication, it was subdivided and the lease was placed into his name. At no stage in my view did he attempt to alter the arrangement as to the contract and the title that he received in respect of the lease.

It is correct as I grasp it that it was drawn to his attention that the gorge was a physical barrier far greater that any of the parties could reasonably have contemplated at the time they made the agreement.

Any loss or consequence that arises in respect of the gorge or the creek however it is described in my view lies with the purchaser that is the claimant. It was for him to make physical inspection of the property if he desired to do so and on my factual findings he had plenty of time to do that. Initially one would have thought from the time he introduced the parties to the land and it was clearly open to him to walk the potential 8 hectares prior to the parties that is the prior owner and the new owners effecting their agreement.

There is evidence that it was drawn to the claimants attention by Mr. Sonneville or one of the representative of the defendant that there was a major issue about the gorge and he chose at that point not to address it. In addition there was subsequent discussion concerning the purchase of some land which would have been an entirely separate contract between the parties but he either didn’t grasp the financial arrangement made by the defendants with their bank, or he did not grasp that he needed himself to make a separate financial arrangement to provide funds to make any necessary purchase, or it may have been of lesser consequence at that time.

In respect of the land itself, I record that I enquired of one of the witnesses as to the movement between the sections which from recollection were lots 32 and 33 but are described variously the land shown 33 and 34 where there is a diagrammatic line showing the impact upon the land of the gorge. I enquired and was told there is a physical obstruction (steepness) to the provision of access over those portions which were adjacent to the claimants land.

The cases on property referred to by counsel which in my notes clearly set out the proposition which is well accepted in property law that it’s for the purchaser to make proper inquiry he chooses not to do so, at his risk.

I also record that two of the cases to which the claimant referred relate to negligence which is in a different category in my view but the principle as expressed in the case number 4 Woolcock –v- CDG [2004] HCA 16 which is the case of the high Court of Australia case set out the same principle as to being put on notice.

It is captured see note 5 Megarry’s Manual of the law of real property at the reference given to me by counsel page 16. The position in New-Zealand is stated quite clearly by Mackenzie J in Ford –v- Ryan and Anor [2007] NZHC 1454 particularly at page 8 paras 16 and 17 where are as follows:

[16] "The starting point for the liability, if any, of the defendants to the plaintiffs must be the terms of the contract between them. An important consideration is that although the defendants had undertaken the construction of the house while they owned the property, this contract was a sale of a completed dwelling. It was not building contract, or a contract to sell the building in the course of construction. That distinction is important, when the potential liability of the vendors. The basic rule in respect of a contract for the sale of land is that responsibility satisfied as to the quality of the property purchased, wich includes the land and any buildings, lies entirely on the buyer. There is no implied warranty that the property has any particular quality or fitness for any particular purpose. The law described in these terms by lord Evershed Mr. in Lynch –v- Thorne [1956] 1 ALL ER 744:

The law of England has been, for many generation, well settled that, facie, on a contract for sale of a piece of land with a house on it, and similarly on the contract for the demise of land with a house on it, there is no warranty as to the habitability of the house. The law, so settled, is illu in Hart –v- Windsor (1844) (12M & 68), and by the judgment in that case of Parke B, The rule is, or has been said sometimes to be, a hard one for the purchaser or lessee who has to console himself with the Latin maxim caveat emptor.

To the general rule, however, there are, undoubtedly, exception: for example, when the subject-matter of a contract of letting is a furnished flat or house, then there is implied a covenant or warranty that the subject-ma is fit for habitation:

See the judgment of Parke B, in Smith –v- Marrable (1843) (11M & W 5), Another exception arises where then contract is not merely a contract for the sale of a piece of land with a house on it, but is a cont the sale of the piece of land with a house, plus a covenant or obligation on the part of the vendor to build or complete the house.

[17] The applicability of the rule of New-Zealand was confirmed in Ware –v- Johnson [1983] NZHC 155; [1984] 2 NZLR 518, at 534 where Prichard J said:

Contracts for the sale or other disposition of interests in land are in a special category. Although the criteria for the implication contractual terms are of general application, it is established law- pre-dating the Moorcock (1889) 14 PD-that caveat emptor applies with particular stringency to contracts for the sale and purchase of land and generally excludes the implication of any warranty as to fitness or quality. The rule, as was observed by Lord Evershed MR in Lynch –v- Throne [1956] 1 ALL ER 744, has sometime been said to be a hard one; but it still applies. This case is not one which falls within either of the exceptions mentioned."

The principle in my view is very clear.

It is for the claimant to make out his case to the requisite standard which in civil proceedings is on the balance of probabilities. It is possible to direct some criticisms to the drafting of the pleadings, but that’s not necessary in my view, the pleadings highlight the issue. The issue is what was the bargain? Did the claimant receive what he bargained for and was he on notice to make proper inquiry. In my view the contract is clear the claimant did receive what he bargained for, any obligation for inspection fell upon him. Accordingly the claimant is unable to make to make out his claim on the evidence adduced before me to succeed.

There are three further matters I need address.

1. This case is an example of delay affecting the bargaining position of the parties. One could be forgiven for thinking that immediately there was a difficulty with good will and the ability to do so these parties (they are known to each other) could have resolved this matter speedily and without the expense they have incurred.

2. I regard the witnesses that gave evidence before me as being honest having integrity, they should in my view restore their relationship they merely suffered a disagreement about a particular issue. The consequence of disagreements are many but one should not be that the defendants, allow the claimant by his claim, to dictate how they behave. They should still be honorable people and be generous as they seem to have been, as was the claimant when they asked him for 10 meters, that spirit of generosity should have been able to resolve this issue.

3. Thirdly and probably more importantly from counsels point of view there is the issue of costs, My view subject to submission is the costs should lie where they fall. My reasons for this are these:

1. There has been considerable delay.

2. It was an issue that it needed to be argued.

3. In respect of the obligations flowing which may fall upon the defendants from the Shefa Counsel there is clear failure to comply with their requirement.

I can see no basis in law for the claimant succeeding based upon the requirements of the subdivisional detail made available to the defendants, but it is certainly an issue to be considered because there may be an unintended benefit to the claimant.

Finally I would like to thank counsel for their assistance in resolving this matter by it enabling to continue into a further day and thus achieve resolution. I record there is Judgment for defendants.

DATED at Port Vila this 6th day of October 2009

J.CLAPHAM
JUDGE