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Petelo v National Bank of Samoa Ltd [2023] WSDC 1 (18 May 2023)

IN THE DISTRICT COURT OF SAMOA
Petelo v National Bank of Samoa Ltd & Ors [2023] WSDC 1 (18 May 2023)


Case name:
Petelo v National Bank of Samoa Ltd & Ors


Citation:


Decision date:
18 May 2023


Parties:
FAAMANINO PETELO (Plaintiff) v NATIONAL BANK OF SAMOA LIMITED (First Defendant); TULILI ALATIMU (Second Defendant) & ELECTRIC POWER CORPORATION (Third Defendant)


Hearing date(s):
30th June & 01st July 2022


File number(s):


Jurisdiction:
CIVIL


Place of delivery:
District Court of Samoa, Mulinuu


Judge(s):
Judge Mata’utia Raymond Schuster


On appeal from:


Order:
The orders will be in accordance as to how this matter should have been reasonably dealt with objectively by the defendant parties in the beginning. The Bank and Ms Alatimu are ordered:

a) to pay the balance of $8,254.73 or the accurate calculated sum paid by Mrs Petelo to EPC from May 2018 to September 2021 but that calculated amount shall not be less than the amount stipulated here based on the evidence available to the court;
b) punitive damages set at 25% of the award arriving at $2,063.68 but say $2,000
c) to pay Mrs Petelo’s costs of $1500

EPC is ordered:

a) To reimburse the Bank $8,254.73 or the calculated sum paid by the Bank to Mrs Petelo pursuant to the order in paragraph 55(a) above upon receipt of written request for reimbursement from the Bank;
b) To pay Mrs Petelo’s costs of $1000

The date of compliance with the above orders must be within 60 days from the date of this order.


Representation:
Mr A. Su’a for Plaintiff
Mr S. Wulf for First Defendant
Ms N. Schuster for Second Defendant
Ms W. Pogi for Third Defendant


Catchwords:
Breach of implied covenant – promissory estoppel – caveat emptor – punitive damages.


Words and phrases:


Legislation cited:
Property Law Act 1952 (NZ), ss. 2; 72(1)(a);
Supreme Court (Civil Procedure) Rules, r. 15.


Cases cited:
National Bank of Samoa Ltd v Electric Power Corporation (unreported 23 February 2021);
Peter Meredith & Company Ltd v Drake Solicitors Nominee Company Ltd [2001] WSSC 32.


Summary of decision:

IN THE DISTRICT COURT OF SAMOA
HELD AT MULINUU


IN THE MATTER:


BETWEEN:


FAAMANINO PETELO of Faleata, Samoa


Plaintiff


A N D:


NATIONAL BANK OF SAMOA LTD, an incorporated company registered in Apia, Samoa


First Defendant


A N D:


TULILI ALATIMU, businesswoman of Siusega


Second Defendant


A N D:


ELECTRIC POWER CORPORATION, a Statutory Corporation and State Owned Enterprise


Third Defendant


Counsels: Mr A. Su’a for Plaintiff

Mr S. Wulf for First Defendant

Ms N. Schuster for Second Defendant

Ms W. Pogi for Third Defendant


Hearing: Hearing 30th June and 1st July 2022
Decision: 18 May 2023


RESERVED DECISION

Introduction

  1. Mrs Petelo brings civil proceedings against the First, Second and Third Defendants for breach of implied covenant pursuant to section 72(1)(a) of the Property Law Act 1952 (NZ). Alternatively, Mrs Petelo seeks orders for Promissory Estoppel against the First and Second Defendants. The First Defendant successfully joined the Third Defendant as a party to these proceedings following a separate preliminary hearing[1].

Background

  1. The plaintiff, Mrs Petelo, is a 72 years old widow of Siusega, Samoa and Mangere, Auckland, New Zealand. She had purchased Lot 3537 Plan 4977 with a house at Siusega[2] from the First Defendant that was on mortgagee sale (hereinafter referred to as the Premises). The premises previously belonged to Kinereta and Tavita Fesola’i[3] by way of a mortgage to the First Defendant (hereinafter referred to as “the Bank”).
  2. Mr Fesola’i leased the land and home to Patrick Boon. Over time, Mr Fesola’i defaulted on their loan whilst Mr Boon was still occupying the premises and the Bank instituted legal proceedings to exercise their power to sell the Premises in order to recover their monies. However, they came to realize that the Premises was occupied by persons allowed by Mr Fesola’i to occupy but without the knowledge of the Bank. The Bank obtained a court order to evict the trespassers[4] prior to a public auction to sell the Premises.
  3. Mrs Petelo was shown the premises by the Second Defendant, Ms Alatimu who was a land agent for the Bank. There was another interested buyer but Ms Alatimu recommended for Mrs Petelo to buy the premises given she had readily available cash. The Bank was not at all satisfied with the purchase price of $180,000 but Mrs Petelo testified under cross examination by Ms Alatimu’s counsel that it was the purchase price Ms Alatimu gave her. It was about a week later, Ms Alatimu came back and said the Bank wanted $185,000. Mrs Petelo did not ask any questions but accepted the final price as she was still happy with her purchase.
  4. The parties coming to an initial agreement, Ms Alatimu advised Mrs Petelo that she can move in and start cleaning up the place whilst they finalized the paper work. Mrs Petelo recalls moving in about the third week of May 2018. It was also this time that she was handed a copy of the Sales and Purchase Agreement (SPA) and asked to show proof of funds by depositing $20,000.
  5. Mrs Petelo was advised by Mr Dick Sasa Neufeldt who was the Recovery Officer for the First Defendant to start an account with them. Why this was required was not clear from the evidence but there seemed a suggestion from Mrs Petelo it was a condition to show proof of funds and to expedite the sale. This account was started on 31 May 2018[5].
  6. About a week in their occupation Mrs Petelo was confronted with an Electric Power Corporation (EPC) outstanding bill totaling $12,300. This was an amount that the EPC unilaterally calculated to have been owed by the registered landowner who unlawfully tampered with the cash power meter. It is a fact undisputed that at the time, Mr Fesola’i resided in New Zealand and Mr Boon occupied the premises. Ms Alatimu in her affidavit stated that Mr Boon tampered with the EPC cash power meter. This fact is not disputed by the Plaintiff, the Bank or Third Defendant’s (hereinafter referred to as “EPC”).
  7. Mrs Petelo the very next day took the matter to Ms Alatimu. This is where the evidence gets tangled up with conflicting testimony. Ms Petelo says that Ms Alatimu assured her that the Bank will settle the EPC bill. This was based on the fact that Ms Alatimu bought the adjoining land that was also owned by Mr Fesola’i and leased to Mr Boon. She found out that there was an outstanding EPC bill of over $12,000. However, after negotiating with ANZ Bank who held a mortgage over the property, ANZ Bank paid the outstanding EPC bill.
  8. Ms Alatimu vehemently denied that she told Ms Petelo that the Bank will pay or that the Bank will reimburse her if she pays the EPC bill. She further testified under oath that she was only made aware about the EPC charge after the signing of the SPA but the Bank was made aware of the EPC charge before transfer of title. She told Mrs Petelo not to pay the EPC charge and that she would take the issue up with the Bank. After advising Mr Neufeldt, the latter told Ms Alatimu to take up the matter with the Banks Credit Manager.
  9. However, Mrs Petelo in her affidavit and oral testimony stated that she informed Ms Alatimu about the EPC charge prior to the signing of the SPA on 6 June 2018[6]. It was not until 13 June 2018 that the purchase monies were deducted by the Bank from her account. Mrs Petelo relied on Ms Alatimu’s assurance led her to sign the SPA believing that the Bank will pay the EPC charge or reimburse her. She never spoke to the Bank about the issue prior to signing the SPA but it was Ms Alatimu who met with the Bank. When the Bank said they were not going to pay, Ms Alatimu then went to meet with EPC. This was confirmed in the testimony of Mr Neufeldt for the Bank and Ms Young for EPC.
  10. Ms Alatimu further testified that although she was the Bank’s realtor, she did not have authority to seek information from EPC as to utility charges on properties for these were confidential to EPC clients which is the reason why she was not aware of the EPC charge.
  11. Her efforts unsuccessful, Ms Alatimu advised Mrs Petelo to seek the assistance of Mr Wulf who was legal adviser to the Bank. Mr Wulf wrote to EPC[7] to cease charging Mrs Petelo as the outstanding charge belongs to the previous owners. Mrs Petelo even went herself to the Bank and EPC but to no avail.
  12. Mr Neufeldt testified that at the time the Bank signed the SPA on 6 June 2018, they were not aware of the EPC debt on the premises until Ms Alatimu subsequently raised it with him. Mr Neufeldt under cross examination by Mr Su’a stated that the Bank did do a search of the utilities but were told that the information was confidential and could not be disclosed to them. He was only aware of the EPC metre tampering when Mr Wulf wrote to EPC on 20 June 2018 copying the Bank. When asked by Ms Schuster, he testified that he had met with Ms Alatimu who raised the issue about the EPC debt with him only after signing the SPA.
  13. Mr Neufeldt under cross examination by Ms Schuster testified that the Bank did not expect their real estate agents to look into any other liabilities related to properties put up for mortgagee sale other than to check on the properties and to find buyers. This was partly consistent with answers given under cross examination by Mr Su’a that the Bank was aware from 2016 to 2018 that there were people living illegally on the premises and that the Bank should have been concerned about the water and EPC bill. Although the Bank accepts that it has a duty when selling property to ensure that such utility charges were cleared before the sale is complete, they were unable to do that in this case because of EPC’s client confidentiality non-disclosure policy.
  14. On the other hand, Ms Emily Young, Debt Recovery Supervisor with EPC, testified that all they needed was for the Bank to inform them that there were or will be new owners. the arrears were unilaterally apportioned over a period from 21 August 2014 to September 2021 according to their Power Disconnection & Reconnection Policy[8] (PDR Policy). The total arrears came to $17,286.82 and a balance of $4,045.27 remained up to the date the reduction was ceased in September 2021. Under cross examination by counsel for the Bank, Ms Young testified that Mr Fesola’i, who was the registered user, entered into an agreement for reduction of the amount where EPC deducts 50% from every cash power purchase.
  15. There was no evidence the PDR Policy and the agreement with Mr Fesola’i was made known to the Bank or Mrs Petelo although Ms Young was aggrieved that EPC should have been notified of change of ownership of the premises. It appears that EPC made no effort to register a caveat or encumbrance on the property. Furthermore, the Policy does not appear to deal with EPC metre tampering although I take judicial notice that it is an offence under s45 of the EPC Act 1980 that attracts a liability of 5 penalty units or 3 years imprisonment or both. Notwithstanding this provision, it appears that EPC were content with their reduction arrangement with Mr Fesola’i as opposed to pursuing charges under s45 against Mr Boon.
  16. As far as EPC were concerned, it did not matter who was/were the new registered owner(s) of the premises because the EPC charge will automatically transfer to the new owners even if the previous owner or tenant or both unlawfully tampered with the metre.
  17. In Mr Neufeldt’s affidavit[9], he stated that the Bank filed a claim on 22 December 2016 to evict the mortgagors and occupiers from the premises given that the Bank was going to mortgagee sale the premises. This was successful and formal orders were made on 5 March 2018.

The issue to be decided

  1. The question to be decided is whether the Plaintiff has recourse at law against any of the defendants in this matter? Mrs Petelo is claiming for a breach of implied covenants as to the sale and purchase of land pursuant to section 72(1)(a) of the Property Law Act 1952 (NZ) (hereinafter referred to as “the Act”). The claim states that Mrs Petelo entered into a sales and purchase agreement with the Bank for the purchase of the said land free and clear of all encumbrances.
  2. Section 72(1)(a) of the Act states:
  3. The term ‘encumbrance’ is defined in section 2 of the Act:
  4. Furthermore, Mrs Petelo raises promissory estoppel as an alternative or second cause of action against the Bank and/or Ms Alatimu for verbal promises that the Bank will settle or reimburse her for the outstanding estimated electricity usage that was tampered unlawfully by the previous occupier.
  5. The outcome of this case may very well impact on EPC hence the reason for their being joined as a party.

Discussion

  1. It is clear from the evidence that the Bank did not deal directly with Mrs Petelo during negotiations of the sale of the premises but through one of their real estate agents, “Southern Cross”, owned and operated by Ms Alatimu.
  2. I find on the evidence that Mrs Petelo became aware of the EPC charge on the premises before the signing of the SPA. I also accept that Mrs Petelo told Ms Alatimu about the charge prior to the signing of the SPA. Mr Neufeldt for the Bank testified that they were not aware about the EPC charge prior to the signing of the SPA. This suggests either Ms Alatimu’s testimony was true that she was not aware of the charge until after the signing of the SPA or that Ms Alatimu failed to inform the Bank about the charge. Ms Alatimu was at pains to explain that she could not obtain such information because it was confidential to EPC and their clients. This is despite the fact that the Bank had already exercised its right to take possession of the premises by default and by virtue of this exercise was the new title holder.
  3. I accept Mrs Petelo’s evidence that she told Ms Alatimu about the EPC charge prior to signing the SPA as consistent with the reasonable and logical chronology of events. It was when she moved into the premises that the EPC charge was evident and naturally followed that she would ask Ms Alatimu about it. The evidence suggests that Ms Alatimu did not seem surprised about this as in her own words the same thing happened to her when she bought the adjoining property from the same owner, Mr Fesola’i. It was only when assured by Ms Alatimu that the Bank will pay or reimburse her for the EPC charge that Mrs Petelo signed the SPA.
  4. The seller of land, inter alia, is required by law to disclose certain information that would be pertinent to the sale and failure may lead to penalties, termination and compensation. Section 72(1)(a) of the Act requires the seller to ensure that the property is free and clear from all encumbrances. The fact that EPC had not registered a charge or interest on the premises as well as the realtor’s (for the Bank) failure or omission to investigate and ensure such information was known to the Bank (as well as the buyer) in no way placed the buyer in a default position of a Caveat Emptor.
  5. There is no dispute that the Bank engaged Ms Alatimu as its realtor to list and sell the premises. There is, therefore, a contract for services and Ms Alatimu owed a fiduciary duty to the Bank to, inter alia, disclose all material facts, transmitting all offers to the Bank, refraining from dual representation in a transaction and generally putting the Bank’s interests ahead of their own. Having engaged Ms Alatimu to sell this particular property, the Bank relied on Ms Alatimu to undertake all the necessary action (list the property, find a buyer, do regular title searches, check utility liabilities if any, etc) to discharge the Banks duty of full disclose allowed by law.
  6. The relevance of the Banks relationship with Ms Alatimu is that fact that Ms Alatimu came to be aware of the EPC charge but for whatever reason failed to disclose it to the Bank prior to the signing of the SPA. Mrs Petelo’s evidence states that it was the third week of May when they moved in to clean the premises that she was faced with the EPC charge and immediately informed Ms Alatimu the next day. The SPA was signed on 6 June 2018 which was about two weeks since Mrs Petelo brought the issue to Ms Alatimu.
  7. From the time Mrs Petelo told Ms Alatimu about the EPC charge, the evidence is unclear as to whether Ms Alatimu brought this to the attention of the Bank. Mr Neufeldt’s evidence suggests that he was only aware after signing the SPA and told Ms Alatimu to see the Corporate Office. If she did inform the Bank prior to signing the SPA, then it would appear that the Bank ignored it. If she did not, then Ms Alatimu failed in her duty to inform the Bank.
  8. However, Mrs Petelo’s claim does not succeed or fall on whether the Bank was informed. Although Ms Alatimu’s evidence states that she was only aware of the EPC charge from Mrs Petelo only after Mrs Petelo signed the SPA, I accept Mrs Petelo’s evidence based on her chronology of the events which are reasonable and follow logically. For all intents and purposes, Ms Alatimu was the Banks agent and therefore was obligated to the Bank as to all the relevant information related to the premises that was put up for sale.

EPC Metre Tampering

  1. The Bank submits that they were not obliged to pay EPC or reimburse Mrs Petelo’s money because the EPC charge was by an unlawful act of the tenant Patrick Boon whom the previous owner leased the premises. Mr Neufeldt testified that the Bank had to file eviction proceedings as they were aware that there were people living on the premises without their knowledge or consent. That in itself should have been concern to the Bank as to how these people came to be on the property and, more importantly, how they had access to water and electricity given that the Bank were not aware they were living there in the first place.
  2. It appears after successfully evicting the trespassers, the Bank did nothing else in terms of up-dating the information related to the premises that the Bank intended to sell via Ms Alatimu. The explanation that the EPC charge was confidential to EPC and the previous owner was trivial and feeble given the Bank was the new owner. Ms Young for EPC testified refuting this explanation in that such information was readily available especially premises with substantial overdue accounts.
  3. I accept that the Bank had reasonable cause to reject payment of the EPC charge. The important question is whether it was ethically correct given the interests of Mrs Petelo. However, the circumstances would have been very different for the Bank if potential buyers, having been aware of the EPC charge, insist that the premises be free and clear from all encumbrances before the sale was finalized. This would have forced the Bank to make a choice whether to pay the EPC charge to allow the sale to proceed or dispute the charge. The latter would logically follow the consequence that EPC will withhold electricity from the premises until a resolution was reached and highly likely to jeopardize the Banks position of selling the premises.
  4. The Bank was fortunate they were not forced into this choice as they already secured Mrs Petelo’s consideration in advance. Mrs Petelo was advised by Mr Neufeldt to start an account with the Bank which was done 31 May 2018 to show proof of funds. By 13 June 2018, the full purchase price was directly deducted from Mrs Petelo’s account by the Bank despite the fact that the Bank was already aware of the EPC charge after the 6 June 2018 (the date the SPA was signed according to Mr Neufeldt’s evidence) but before the 13 June 2018.
  5. According to Mrs Petelo, the SPA would not have been signed and the money released to the Bank if she had not been assured by Ms Alatimu that the Bank would pay the EPC charges or reimburse her.
  6. I have arrived at the view that the Bank having been made aware of the EPC charges prior to transferring the funds from Mrs Petelo’s account, had an ethical duty as a Seller to clear the EPC charges leaving the premises free from any encumbrances.

EPC

  1. EPC by its’ own evidence stated that they made an arrangement with Mr Fesola’i as the “registered consumer” to pay off the EPC charges unlawfully tampered and used by Mr Fesola’i’s tenants, Patrick Boon. There is no evidence to show how much was paid by Mr Fesola’i, what was the balance remaining and when did Mr Fesola’i stop making any payment. It could be inferred that payments stopped when the Bank obtained eviction orders on the 5 March 2018 and once the occupiers left the premises, no more deductions were received by EPC through top-up of the cash power meter. Ms Pogi in her submissions paragraph 21 stated that Mr Fesola’i was declared a bankrupt and necessarily led to the arrears being “written off”. However, there is no sworn evidence of such in Ms Young’s evidence and the court cannot accept this contention except for Ms Young’s evidence that the remaining reduction balance of $4,045.27 was ceased in September 2021.
  2. Mrs Petelo testified that about $12,300 was the outstanding charge when they moved into the premises about the third or fourth week of May 2018. Ms Young testified that the balance of $4,045.27 remained to Mrs Petelo suggesting EPC was still going to pursue that amount. However, for whatever reason known to EPC and not attested in Ms Young’s sworn testimony, the reductions were ceased in September 2021.
  3. The question to be asked is whether EPC was justified in passing on an unlawfully tampered EPC charge to the Bank from the previous owner Tavita Fesola’i[10] or Eti Laulala[11] or both particularly when EPC came to an arrangement from Tavita Fesola’i to settle the charge. Ms Young testified that EPC acted within their debt recovery policy despite the fact that the policy was silent in a situation of unlawful electricity tampering. Ms Young further emphasized that the Bank had a duty to inform them that the ownership had changed hands. Perhaps Ms Young meant that EPC would have called in the full amount from Mr Fesola’i or taken legal action to recover the balance knowing that there was to be new owners of the premises. Unfortunately, the evidence did not go that far.
  4. EPC in their written submissions paragraph 15 and 21 submit that the unpaid electricity liability is attached to the “property” or a debt on the “property”. However, in other places of its submission, Ms Pogi calls a supply of electricity to a consumer a “contract” between EPC and the “consumer”. EPC accepts that the registered consumer, not the property itself, is contractually liable to any arrears including arrears obtained through illegal tampering. Clearly a physical property could not be held liable to any debt or unlawful activity not being a person or a corporate entity. Therefore, it would follow logically that unpaid electricity liability or debts would be attached to the “registered consumer”. Ms Pogi is correct in paragraph 19 of her submissions that there was no contract between EPC and Mrs Petelo but there was a contract between EPC and the previous owner, Tavita Fesola’i, who was the person to be held responsible for the debt or illegal tampering.
  5. The fact is unlawful tampering was not an expected circumstance in this case as far as EPC was concerned though it may not be an unusual event for EPC. However, it is in my view unconscionable and unethical for EPC knowing that they had an arrangement with Tavita Fesola’i to pay off electricity use that was unlawfully obtained to then turn around and pass that liability on an innocent buyer just to recover their loss. Furthermore, and notwithstanding the new owner being the Bank, EPC should have pursued the debt and unlawful tampering against Tavita Fesola’i and not hold to ransom Mrs Petelo as to the free and unencumbered occupation of her newly acquired property.
  6. Finally, EPC insist that there is no filed cause of action from Mrs Petelo against EPC pursuant to Rule 15 of the Supreme Court (Civil Procedure) Rules. This is basically a strike out argument. It is open to counsel to move to strike out a claim as disclosing no cause of action or is frivolous, vexations and an abuse of process to demonstrate even by extensive argument that a claim is so clearly untenable that it has no possible chance of success on any of those grounds that it should be struck out[12].
  7. However, EPC was joined as Third Party by the Bank for charging the Bank with the EPC charge which was agreed by all the parties, especially EPC, as the liability of the previous owner Tavita Fesola’i. Therefore, in the absence of any agreement with the Bank for the Bank to knowingly take over the liability, the Bank asserts that EPC were in no position to place a charge on the EPC meter relating to the premises but to pursue a claim with the previous owner.
  8. Ms Pogi’s submissions in paragraph 21 suggested that EPC could not identify who tampered with the meter. This is inconsistent and contradicts the evidence of Ms Young who testified that the arrears dated back to 21 August 2014 and were only ceased in September 2021. Furthermore, Ms Young testified that the assessment of the arrears was calculated from the time it was tampered and placed on the person who was the “registered consumer” at the time. Ms Young testified that EPC entered into an agreement with the registered consumer known at the time to be Tavita Fesola’i who accepted the invoice and agreed to deduct 50% of every cash power purchased to reduce the arrears. Ms June Teaurima, Mrs Petelo’s daughter, in her sworn testimony that was not disputed by EPC annexed a breakdown of the cash power payments made since Mrs Petelo took over the premises. It is noted that the registered “customer” name was “Eti Laulala” who was suggested to be Mr Fesola’i’s business partner.
  9. The point is that EPC knew who was responsible for the illegal tampering going back to 2014 and it could not have been the Bank or Mrs Petelo.
  10. There is no doubt that EPC were well aware of Mrs Petelo’s claim and the purpose for which it was joined by the Bank. A special fixture was conducted to hear separately the joinder application of which EPC were well represented by Ms Pogi. EPC strenuously disputed any participation or liability by their participation. It is in my view that EPC were not prejudiced in any way except if they were not to be made a party to these proceedings. There is clearly a case to be made against EPC given their conduct in this matter.

Side note

  1. This case involved overlapping issues that required consideration whilst determining Mrs Petelo’s claim. These are: (1) the relationship of a Seller and Realtor agent and their underlying duties and responsibilities to each other and to potential buyers; and (2) that of the EPC and landowners who are or have sold properties without discharging EPC arrears whether unlawfully tampered with or not. This decision has not attempted to deal exhaustively with these issues given the nature of the claim but nevertheless consider them important to mention given they are live concerns in such transactions.
  2. As to the first, Samoa does not have a real estate legislation, like the Real Estate Agents Act 2008 of New Zealand that governs and regulates the conduct of commercial real estate activity in Samoa. The current remedy against real estate agents that do not take their duties seriously lies in Tort. The determination to be had is what these duties are in the absence of legislation where the latter would normally spell out such duties and remedies. That issue I leave with the appropriate body of legislature and interested stakeholders to consider.
  3. The second issue, particularly in relation to this case where unlawful electricity meter tampering was involved, perhaps is not uncommon but appears to happen and presumably in rare occasions. It is unfortunate that EPC relied on the path that they took in this case to the detriment of Mrs Petelo which was inconsistent or non-existent in their Power Disconnection and Reconnection Policy or the operating EPC legislation. Such conduct in my view is tantamount to abuse of power and bullying in a situation where Mrs Petelo found herself but not of her making. The fact that electricity is in many cases of high demand and EPC holding the upper hand and being the only service provider, EPC should consider reviewing its policies particularly in situations as this case to avoid the perception of “strong arming vulnerable clients” to ensure that innocent consumers are not made out of pocket due to the liability of others.

Conclusion

  1. I find that the Bank and Ms Alatimu its realtor failed to do that which was reasonably possible and obligated to do. That is, to ensure that the premises was free and clear from all encumbrances such as the EPC charge. Although the Banks reason for not settling the charge may be reasonable, nevertheless in the face and circumstances of the sale of the premises to Mrs Petelo, the Bank was obligated to Mrs Petelo to discharge the EPC charge.
  2. Mrs Petelo testified that there was a balance of about $12,300 of the arrears that was remaining when she started paying the EPC charge. This was not disputed. Ms Young from EPC testified that the deductions were ceased in September 2021 with the remaining balance of $4,045.27. This means that Mrs Petelo since the end of May 2018 paid about $8,254.73 of the EPC charge that was owed by the former landowners Tavita Fesola’i, Eti Laulala or both.
  3. Ms Alatimu is equally liable given that despite the fact she was aware of the EPC charge prior to the signing of the SPA on 6 June 2018 and the subsequent transfer of funds on 13 June 2018, she failed to disclose the EPC charge to the Bank who engaged her as realtor. The Bank will have to work out on its own in consultation with Ms Alatimu as to how much Ms Alatimu must contribute to this award plus costs so far as their business relationship is concerned. Any disagreement as to what that contributory amount should be shall not delay payment of the full award by the Bank to Mrs Petelo within the time stipulated under the orders.
  4. Given the conclusion that I have arrived at, there is no need to deal with the claim of promissory estoppel against Ms Alatimu.

Orders

  1. The orders will be in accordance as to how this matter should have been reasonably dealt with objectively by the defendant parties in the beginning. The Bank and Ms Alatimu are ordered:
  2. EPC is ordered:
  3. The date of compliance with the above orders must be within 60 days from the date of this order.

JUDGE MATA’UTIA RAYMOND SCHUSTER

[1] National Bank of Samoa Ltd v Electric Power Corporation (unreported 23 February 2021) DC303/19
[2] Exhibit P1 Annexure A
[3] Exhibit D1(a) Annexure B
[4] Ibid Annexure A
[5] Exhibit P1 Annexure “C”
[6] Exhibit P1 Annexure “B”
[7] Exhibit P1 Annexure F
[8] Exhibit D3 Annexure “A”
[9] Exhibit D1 (a)
[10] Exhibit P1 Annexure “E” receipts showing Tavita Fesola’i as registered consumer.
[11] Exhibit P2 Annexure “I” EPC computer printout of payments showing Eti Laulala as Customer.
[12] Peter Meredith & Company Ltd v Drake Solicitors Nominee Company Ltd [2001] WSSC 32 (10 December 2001)

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