Schwenke v Leafa [2002] WSDC 2 (28 June 2002)

IN THE DISTRICT COURT OF SAMOA
HELD AT APIA

BETWEEN

LEPOPOI SCHWENKE and ROSITA SCHWENKE
of Vaimea, Proprietors of DIGITAL WAVE STUDIO
PLAINTIFFS

AND

ATIMALALA LEAFA
of Malie, Civil Servant
DEFENDANT

Counsel: M. Tuatagaloa for Plaintiffs
S. Leung Wai for Defendant

Dates of hearing: 17th & 23rd April 2002
Date of decision: 28th June- 2002

DECISION OF NELSON, J

These proceedings were heard some two months ago and I must at the outset apologise to Counsel that it has taken this long for a decision to be rendered. This is not because the matter is unnecessarily complicated but is because as counsel are aware, there is presently only one judge undertaking all the work of the District Court Bench.

I do not propose to canvass the facts in any great detail. Only the material facts need be referred to. The plaintiffs allege that on or about Christmas of 1997, they verbally hired some band equipment to the defendant for $200 per week. The plaintiff Mr Schwenke testified that the hire charge was $250 per week but I am satisfied from his wife's evidence (she being in charge of the invoicing and books of account of the plaintiffs business) and the other material produced before me that the hire charge was in fact $200 per week. The hire contract was for no specific term but was on a week by week basis. At the outset, there was no evidence that the equipment was in anything other than good working order and condition.

The plaintiff's say payments were regular initially but began falling into arrears around April 1998. From that time on, Mrs Schwenke had to follow up payments and the defendant would periodically make lump sum payments for outstanding arrears. Mrs. Schwenke began keeping a record of these payments and the arrears periods they related to and this was produced to the Court as 'Exhibit 5' for the plaintiffs. It is clear from that record that no payments were received to cover the period 31 August 1998 onwards.

In October 1998, a dispute arose between the plaintiffs and a third party as to ownership of the equipment being hired out to the defendant. This dispute led to court proceedings between the third party and the plaintiffs. Both the third party and the plaintiffs appear to have agreed that pending resolution of their dispute, the equipment would remain with and continue to be used by the defendant. Mr Schwenke testified that he told the defendant 'no-one was to touch the equipment until the court case was over' and he agreed to the defendant meantime retaining possession. The clear inference from this evidence is that the plaintiffs agreed to the defendant continuing to hire and use the equipment and this is reinforced by the plaintiffs claim in these proceedings to be entitled to rental monies from the defendant for the period October 1998 onwards. The solicitors for the third party similarly advised the defendant by letter dated 26 October 1998 (produced as 'Exhibit 6' for the plaintiffs) to hold the equipment until the dispute with the plaintiffs was resolved and further that any hire payments due to the plaintiffs be also withheld. It is clear from Exhibit 6 for the plaintiffs that the third party agreed to the defendants continued use of the equipment.

The plaintiffs' evidence was that the dispute over ownership of the equipment was only resolved in July 1999 and by letter dated 28 July 1999, (Exhibit '7' for the plaintiffs) the defendant was instructed to return the plaintiffs equipment and pay up all outstanding rental to the plaintiffs. Mrs. Schwenke testified that on or about 28 July 1999, she uplifted from the defendant's premises what remained of the equipment. The rest of the equipment had earlier been removed by the third party. It is not clear whether the third party did this as part of the dispute settlement or whether he forcefully removed these items, but as will become apparent from the Courts findings below, this matter becomes irrelevant.

The defendant in answer' to this claim admits that he hired the plaintiffs equipment pursuant to a verbal agreement for hire, but said the contract only commenced in April 1998.

He added however that the contract was terminated in late October 1998 because at that time, he was discussing with Mr Schwenke possible purchase of the equipment. Those discussions went no further when the third party intervened and advised him the plaintiffs were not the true owners of the equipment and subsequently, he was told the matter was in the hands of lawyers and the Courts. He testified that his club continued to use the equipment until just before Christmas 1998 when he began having problems with it. He placed the equipment into storage and hired replacement equipment from one Junior Chan Boon. He notified the third party of the problem because he considered the third party was the rightful owner. In about January or February 1999, the third party's son came and removed most of the equipment. What was left was uplifted by Mrs Schwenke in July 1999.

The defendant admitted his rental payments were at times in arrears and he identified Exhibits '3' and '4' for the plaintiffs - these were handwritten notes from him to the plaintiffs promising to settle his arrears. He maintained however that his agreement with the plaintiffs (and therefore his liability to them for rental) ceased in October 1998 as it was then replaced by an agreement with the plaintiffs to purchase the equipment. It did not seem to trouble him that such an agreement was missing the essential fundamentals of a price, method of payment, time for payment, and so forth. Neither did it worry him that as late as November 1998, he was still making rental payments to the plaintiffs.

Based on the verbal and written evidence adduced, it is quite clear that at all material times, the plaintiffs and the defendant were parties to a verbal contract for hire of the band equipment, on a week by week basis, for a rental of $200 per week. Rental payments were made by the defendant but no payments were received for the period commencing 31 August 1998. From that time on, the defendant failed to meet his contractual obligations. Those obligations however only continued to accrue until just prior to Christmas 1998 as the defendant's testimony was that from then on, the equipment was no longer in working order and condition. Prior to that, it had been in use at his niteclub. He did not explain how the equipment had malfunctioned or even whether all of the equipment had malfunctioned but what he did say was that he placed the plaintiff s equipment into storage and hired replacement equipment. That evidence was not contested by the plaintiffs and it accordingly stands uncontroverted. Clearly, it was an implied term of the hire contract that the equipment be in working order and condition. The defendant is therefore in my view only contractually bound to make rental payments for the period 31 August 1998 to just before Christmas 1998, a period which I fix at 15 weeks.

The plaintiffs are entitled to succeed but only for this period of 15 weeks which at $200 per week is the sum of $3,000. The plaintiffs are also entitled to costs which I fix at $500 making a total amount payable of $3,500. Judgment will be entered for the plaintiffs in that amount.

JUDGE