Fruean v Fruean [2015] WSSC 193 (27 November 2015)

SUPREME COURT OF SAMOA
Fruean v Fruean, Charlie and Fruean [2015] WSSC 193

Case name:	Fruean v Fruean, Charlie and Fruean
Citation:	[2015] WSSC 193
Decision date:	27 November 2015
Parties:	MARGARET FRUEAN, of Tufuiopa, Siusega and Vaivase-uta, Samoa (plaintiff) and JULIUS & LENITALI FRUEAN of Vaitele, Samoa (first defendant), PAPALII LIMA CHARLIE & PATRICIA FRUEAN of Vaivase-uta, Samoa (second defendant)
Hearing date(s):	3rd and 4th December 2014
File number(s):	-
Jurisdiction:	CIVIL
Place of delivery:	Supreme Court of Samoa, Mulinuu
Judge(s):	Justice Vaai
On appeal from:	-
Order:	(i) The order of interim injunction dated 24th March 2014 is rescinded and discharged. (ii) The ownership by the plaintiff of the land through survivorship is declared null and void. (iii) The plaintiff shall within 10 days execute and register at her own costs a transfer of ownership of the land to herself, Julius, Charlie, Emma and Joshua in equal shares. (iv) The defendant Charlie who currently has the care and custody of Joshua shall take immediate possession of the land and buildings and shall manage, occupy or lease all or any of the buildings during the lifetime of Joshua to provide for maintenance and care giving for Joshua and to maintain and repair fair wear and tear to the premises. Access by the other 3 siblings to visit the mother’s grave shall not be denied. (v) Charlie shall provide annually to the other 3 siblings a statement of account for the care and maintenance of Joshua and of the rental income and expenses. (vi) Leave is granted to either party to seek further orders or to vary these orders. (vii) Costs shall be paid by the plaintiff. Counsel to file memorandum if costs are not agreed upon.
Representation:	M Betham-Annandale for plaintiff R Drake for first and second defendants
Catchwords:	Dispute about ownership -
Words and phrases:
Legislation cited:
Cases cited:
Summary of decision:

IN THE SUPREME COURT OF SAMOA

HELD AT MULINUU

BETWEEN:

MARGARET FRUEAN of Tufuiopa, Siusega and Vaivase-uta, Samoa
Plaintiff

AND:

JULIUS & LENITALI FRUEAN of Vaitele, Samoa
First Defendant

AND:

PAPALII LIMA CHARLIE & PATRICIA FRUEAN of Vaivase-uta, Samoa
Second Defendant

Counsel:
M Betham-Annandale for plaintiff
R Drake for first and second defendants

Judgment: 27 November 2015

JUDGMENT OF THE COURT

Introduction

1. The plaintiff Margaret, and the first named first and second defendants (the defendants) Julius and Charlie are three of the five children of the late Palepa Fruean, widow, (mother) who passed away in December 2013. The second named first and second defendants are the wives of the defendants. The other two children of Palepa are Emma and Joshua. Joshua the youngest is mentally handicapped. The plaintiff is the eldest of the five children.
2. These proceedings concern a dispute between the plaintiff and the defendants about the ownership of a quarter acre property at Vaivase-uta bought in 1991 as vacant land. A residential home for the mother was built on the land in 1994. The mother, Joshua and defendant Julius occupied the house in 1994 when it was liveable and before it was completed. A bed sitter and Samoan fale were later added after the residential home was finished. Defendant Charlie also lived on the land at some later stage.
3. The two defendants moved out of the land at different times. Prior to her death, the mother was living on the land with her son Joshua. She had retired from work in 2004. Defendant Julius hired a house keeper to be a companion and house keeper for the mother. The plaintiff and Emma also visited and sometimes spent the night with their mother, and on other occasions the mother visited and spent the day with the plaintiff. All the four older children took care and contributed financially for the upkeep of the mother.
4. In accordance with her wishes, the mother is buried on the land. She also expressed a wish for her youngest son Joshua to live on the land and to be buried next to her.
5. After the mother’s death, the defendants in March 2014 erected a chain link fence around the land for security reasons and to keep Joshua from wondering out of the land and getting attacked by the neighbour’s dogs. They also rented out one of the houses to assist with expenses and care-giving for Joshua. They had the keys to the houses. To their disbelief the defendants were served with a letter from the plaintiff’s solicitor in February 2014 which was followed by an order of interim injunction dated the 24h March 2014 (about three months after their mother’s funeral) obtained by the plaintiff, as the rightful legal owner of the land, prohibiting the defendants from:

• (a) entering onto the land, except when visiting the grave of their late mother on Tuesdays and Fridays from 12am to 6pm for that purpose only;
• (b) entering the land and carrying out any further fence work or other work on the said land; and
• (c) from interfering with the applicant’s right and enjoyment of her land by entering or renting out the houses on the land without the plaintiff’s permission.

6. As a result of the order, Joshua could no longer live on the land in accordance with the mother’s wishes. The two defendants took turns to care for him at their respective homes.
7. For the first time the defendants became aware that the land was registered under the mother and the plaintiff as joint tenants.
8. In her statement of claim seeking an order of injunction the plaintiff said inter alia,

• (i) that the plaintiff and her late mother were the owners of the said land as joint tenants which they purchased through a loan obtained by the plaintiff in 1990 from the Samoa Housing Corporation and which was serviced solely by the plaintiff and the mother.
• (ii) that since the passing of the mother, the plaintiff is now the rightful legal owner by survivorship.

9. In their Statement of Defence and Counterclaim the defendants alleged inter alia:

• (i) that the land was purchased by the mother through a soft loan from her employer and which was serviced by direct deductions from her salary.
• (ii) through the dishonesty and fraudulent conduct of the plaintiff, who took advantage of the mother’s limited knowledge and her complete trust in the plaintiff, the plaintiff arranged for the transfer of title and included herself as the joint owner.
• (iii) they seek an order to declare null and void the joint tenancy and the subsequent sole ownership by the plaintiff and for the plaintiff to hold the land under a constructive trust for all the five children.
• (iv) In the alternative, the defendants seek damages for unjust enrichment.

Plaintiff’s Claim to Joint Ownership

10. Prior to the purchase of the land in October 1991, the mother and her four older children were anxious to build a house of their own as their late father had gifted the land they were living on to his four sons from his previous marriage. The mother was then working for Aggie Greys hotel, the plaintiff was employed by the Treasury Department, Julius was working in American Samoa, Charlie was overseas studying and Emma was living at Vaimoso with her husband.
11. The plaintiff told the court she submitted a bid of $16,000 for the land advertised by the Public Trustee in the newspaper in September 1991. When she was advised by the solicitor for the Public Trustee of her successful bid, she talked with her mother and they obtained a loan of $11,000 from the Samoa Housing Corporation to complete the purchase. Repayments of $260 per month to the Housing Corporation were through direct deductions from the bank accounts of the plaintiff and of the mother.
12. The plaintiff also told the court that she saw the solicitor concerning the deed of conveyance and was advised by the solicitor that since both the plaintiff and the mother contributed to the purchase price both of them would be joint tenants. She was asked under cross examination (Page 18 – 19 3/12/14).

Question: Did you instruct Mr Toailoa on the preparation of that deed of conveyance?

Answer: Mr Toailoa advised me that –

Question: Did you instruct Mr Toailoa, my question is did you instruct?

Answer: I was advised that since we were both contributing to the purchase price of the land that we are both joint tenants to the land.

Question: Mr Toailoa is only the solicitor who will act on instructions of the client, did you instruct Mr Toailoa to prepare the deed in both names, Palepa Fruean and Margaret Fruean.

Answer: I was advised because when we called he said.

Question: Answer my question Margaret, don’t prevaricate, answer my question.

Answer: I did not instruct

Question: You did not instruct?

Answer: I did not instruct but I was advised by Mr Toailoa that he’s going to prepare deed and we will both be joint tenants.

And further on at page 20 she was asked:

Question: And would I be correct that your mother, like most of our parents of that generation, did not speak much English.

Answer: Yeah, a little bit English she spoke but I always explained to her what’s going on, like seeing advertisements, doing the tender which I signed, discussing with her the loan with the Housing Corporation. I always tell her everything.

13. The plaintiff also maintained that the two defendants and Emma knew that the land was jointly owner by the mother and the plaintiff. She said at paragraph 27 of her supplementary affidavit that Emma was aware because Emma and husband together with the plaintiff would often go to the land to clear the weeds, plant the perimeter hedge and maintain it even up to the time the 3 buildings were built on the land. At paragraph 28 she claimed that defendant Julius was aware of the joint ownership as Julius often voiced his disagreement with the fact that the land belongs to her and the mother. At paragraph 29 she claimed that the defendant Charlie knew as Charlie on at least three occasions sought the written consent of the plaintiff and the mother to use the land as collateral for his bank loans.

Contributions to Improvements on the land

14. By her own admission the plaintiff concede that the defendants and Emma contributed to the costs of improvement on the land, but she insisted that they did so with the full knowledge of the joint ownership. Other than clearing the weeds and planting the perimeter hedge, her only financial contribution to the construction according to her documentary and oral evidence was the purchase of the roofing irons for the main dwelling house. The two defendants, with Julius in particular, financed the bulk of the construction through building drawings, provision of machinery and provision of building materials, and other essential services like water and electricity.
15. It is no secret that Aggie Greys Hotel provided and paid for the four carpenters to build the bed sitter and Samoan fale for the mother as an acknowledgement of her long faithful service of over 30 years, and in particular, her care giving service to Mrs Aggie Greys, the founder of the hotel.

Claim by the defendants as to ownership

16. Both Julius and Charlie contended that it was not until they received a letter in February 2014 from the plaintiff’s solicitor that they discovered the joint ownership of the land by the plaintiff. From the time all of them initially cleared the land to the time the machines were hired to level the land and from the time the building materials like bricks rebars and cement were stockpiled before construction to the time of construction, and from the time the mother, Julius and Joshua moved on to the land when the house was liveable to the time Julius completed the house, the plaintiff just stood back and watched the defendants, Emma and the mother expend time and money on the property under the mistaken belief the property was owned by the mother.
17. As a result of the discovery, they instructed counsel. They also consulted Allan Grey the Managing Director of Aggie Greys hotel and the son of Aggie Grey. Mr Grey filed an affidavit. He also testified, confirming the contents of his affidavit that he did sign a cheque of $16,000 for the mother in October 1991 for the mother to purchase land at Vaivase-uta. He told the court he had no hesitation in granting her an interest free loan on very soft terms for her long dedicated service to his late mother.

Discussion

18. Since all the parties agree that the four older children of Palepa contributed to the costs of improvements on the land as well as to the care and her upkeep during her final years, the only issues for the court to decide are firstly whether the plaintiff contributed to half the purchase price of the land, and secondly if she did, did the defendants and their sister Emma knew at the time they contributed to the costs of improvements that the plaintiff was the joint owner.
19. It is quite obvious from the testimony and affidavit of the plaintiff that even if the mother was told that she was the part owner, or joint tenant, she certainly was not told nor explained the meaning and consequences of joint tenant, and as a result she was not given the chance to choose whether she wanted to be a joint tenant or tenant in common. The fact that she wanted to be buried on the land and that she also wanted her youngest son Joshua to be cared on the land and buried besides her provides the simple answer to the two issues I outlined above. The mother, the defendants and Emma were simply and deliberately kept in the dark. For very obvious reason, the plaintiff did not assert her joint ownership when the mother voiced her wishes.
20. The testimony and affidavit of the plaintiff that the land was paid for by a loan from the Housing Corporation in March 1992 is simply not correct because the land was conveyed in October 1991. I will return to the Housing Corporation loan. But the deed of conveyance was executed by the Public Trustee as the vendor on the 31^st October 1991 and by letter dated 4^th November 1991 the Public Trustee forwarded the deed of conveyance to the Solicitor for stamping and registration. It was registered on the 18^th November 1991. The Public Trustee as vendor acknowledged in the deed that the purchase price of $16,000 has been received.
21. In relation to the loan from the Housing Corporation, the same solicitor who prepared the deed for conveyance was instructed by letter dated 10^th March 1992 to prepare the security documents, namely a third party mortgage over the land. The first sentence of the letter says:

“A housing loan has been approved for the aboved named.”

Which follows that the loan approved in March 1992 was for the construction of the home as the land was already conveyed in October 1991. But the plaintiff insisted the loan was approved and disbursed in 1991 and direct deductions were made from her bank account and the mother’s account in October 1991. She said at page 45 transcript 3/11/14:

“ I would say that when the loan was granted by Housing of 11,000 together with 5,000 that we had, this loan was granted in October 1991 and was given to the agent of Toailoa to pay off the land and that could be the possible explanation as to the date of 31.10.1991 because my first repayments were made on the 12.11.1991 and the dates here of registration was the 15.11.1991.”

She was then asked for an explanation of the housing mortgage in 1992 and she responded.

“Well I guess because Housing Corporation was a new entity established in 1991 and may be they were trying to have their processes in place and that’s why the preparation of their mortgage agreement only done in 1992 but our first repayment was done in 1991.”

22. The feeble explanation that the loan funds were released in October 1991 and the security documents executed in March 1992 simply cannot be accepted and is rejected. The second to last paragraph of the letter of instructions of the 10^th March 1992 from the Housing Corporation to the solicitor says:

“Please return to duplicate of this letter signed by a solicitor when documentation is completed and in order to release.”

It is true that direct deductions were made from the bank account of the plaintiff and Palepa in October 1991 to the Housing Corporation but they were probably for a different loan with the Housing Corporation. This is evident from the repayment terms of the loan:

REPAYMENTS INCLUDING: On demand, but until such time

INTEREST & PRINCIPAL as demand is made, the following repayment programme shall apply

Continued at the rate of $260 per month.

In its letter of instructions the Housing Corporation also knew and acknowledged that the land had already been purchased and registered. It says under the heading SECURITY:

3^rd party First mortgage over ¼ acre freehold property at Vaivase-uta (Original deed of conveyance is at your possession).

The same letter was received by the plaintiff on the 16^th March 1992. She initialled and dated the right top corner of the letter. She arranged the loan which was taken out in the mother’s name.
There is simply no cloud of doubt that the loan approved by the Housing Corporation was not, as the plaintiff contended, for the purchase of the land. And whether the proceeds of the Housing loan was expended in the construction of the mother’s house is another story as construction did not commence until 1994 and the defendant Julius had before construction stockpiled and purchased most of the building materials.
23. It follows that the mother paid for the land from funds advanced to her by Aggie Greys Hotel. And she only went to the solicitor’s only once to sign the mortgage documents. It was the plaintiff who did all the arrangements with the solicitor for the conveyance of the land, the loan application with the Housing Corporation and the Security documents. She arranged for her name to be included on the deed of conveyance.
24. The defendant’s counterclaim of actual fraud in the sense of conscious dishonesty against the plaintiff succeeds.

Remedy

25. Counsels were advised of the courts determination of the evidence and invited counsels to suggest the appropriate form of remedy, bearing in mind that the mother is buried on the land, her wishes for Joshua to be buried besides her and particularly the continuing hostility amongst the parties. A constructive trust is the most obvious remedy given that the plaintiff will be required to convey the land to herself and her other siblings.

At the suggestion of counsel for the plaintiff, a judicial settlement conference to attempt to settle the form and shape of a constructive trust was organised and agreed upon. Unfortunately the plaintiff changed her mind at the last minute and the scheduled meeting did not eventuate.

26. The basis of the constructive trust is the unjust enrichment which would result if the plaintiff was permitted to retain the land. It is a formula through which the conscience of equity finds expression. The remedial role of the constructive trust requires that the equity of the transaction must shape the measure of relief.
27. When the plaintiff applied exparte for the interim injunction she did not disclose that it was the mother’s wish for Joshua to be taken care of on the land and to be buried next to her. Joshua was at the time taken care of and still is taken care of by Julius and Charlie.

As a result of the interim injunction order Joshua was removed from the land together with his caregivers.

28. There is no indication that the plaintiff wishes to improve the relationship with the defendants. It would be wrong to place her in the position of trustee. It was said Carl Zeiss Stiftung v Herbert Smith & Co (No 2) (1969) 2 Ch 276 at 300 that the constructive trust’s boundaries have been left perhaps deliberately vague, so as not to restrict the court by technicalities in deciding what the justice of a particular case may demand.
29. Stressing the remedial aspect of the constructive trust, it can be said that the court will not impose or declare a constructive trust if in the circumstances it considers that the claimant’s ordinary legal remedy provides adequate and appropriate relief, or another form of equitable relief will satisfy the demands of justice and good conscience.
30. The most practical person to be appointed trustee is Joshua’s caregiver. At the moment, Charlie who lives close to the land is the caregiver. He will therefore walk over to the land with Joshua, or if a permanent caregiver is employed, Joshua and the caregiver can stay on the land with Charlie close by to assist and be consulted if needed. Charlie’s role will therefore be simply restricted to the guardship and care-giving of Joshua as well as attending to upkeep and managing of the land and buildings to finance the care giving for Joshua and to carry out repairs and maintenance to the buildings and land.

Orders

(i) The order of interim injunction dated 24^th March 2014 is rescinded and discharged.
(ii) The ownership by the plaintiff of the land through survivorship is declared null and void.
(iii) The plaintiff shall within 10 days execute and register at her own costs a transfer of ownership of the land to herself, Julius, Charlie, Emma and Joshua in equal shares.
(iv) The defendant Charlie who currently has the care and custody of Joshua shall take immediate possession of the land and buildings and shall manage, occupy or lease all or any of the buildings during the lifetime of Joshua to provide for maintenance and care giving for Joshua and to maintain and repair fair wear and tear to the premises. Access by the other 3 siblings to visit the mother’s grave shall not be denied.
(v) Charlie shall provide annually to the other 3 siblings a statement of account for the care and maintenance of Joshua and of the rental income and expenses.
(vi) Leave is granted to either party to seek further orders or to vary these orders.
(vii) Costs shall be paid by the plaintiff. Counsel to file memorandum if costs are not agreed upon.

JUSTICE VAAI