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Wu Kim Ping v Wu Kim Kam [2003] VUSC 12; Civil Case 075 of 2000 (14 March 2003)

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

Civil Case No. 75 of 2000

BETWEEN:

WU KIM PING
Plaintiff

AND:

WU KIM KAM
Defendant

JUDGMENT

The plaintiff and defendant are sisters. Their father wanted to provide for them after his death. As a result they are the joint owners of a lease over land in Luganville. There is a shop and residential accommodation on the land. From 1992 the two sisters ran the shop as a business. There was no formal agreement and no real accounting. They each worked in the business and drew monies as required for their own and their families living expenses. There was one joint account. All appeared to be working well.

On 26th January 1995 the plaintiff gave birth to Bruno. Within a few months it was clear that Bruno had severe hearing problems. The plaintiff took him to doctors in New Caledonia and Australia. Diagnoses of profound deafness and other conditions were made. Treatment was prescribed.

The plaintiff found the expenses in Australia were beyond her means. After family discussions she decided to go with Bruno to Hong Kong for examinations and the prescribed treatment at less cost. She took a bank draft of VT1,000,000 from the business for medical expenses. A portion was to be used to pay a supplier of the business based in Hong Kong. The defendant says this payment wasn’t made. She paid in Santo. The defendant’s husband came from Hong Kong to help with the shop.

In July 1998 the plaintiff and Bruno travelled to Hong Kong. Shortly before that her husband moved to Port Vila to set up a restaurant business and for the secondary schooling of their older two children. The plaintiff telephoned the defendant about once per month from Hong Kong to see that all was well with her other children and the business.

In September the defendant rang the plaintiff to say the plaintiff’s husband had taken VT400,000 out of the business as deposit on a truck he was buying to make him mobile in Port Vila. He would pay back in instalments.

On 19th December the plaintiff telephoned her sister. The defendant said the plaintiff’s husband was a thief. He had stolen money. The plaintiff says she asked “If you are telling me that he has stolen money, you should be able to tell me how much.” The defendant replied “You are lying, you must know. If you continue to lie when you come back to Santo I will slap you.” She telephoned her husband and she says he replied “why is she making the allegation to you? If she is accusing me of stealing, she should say it to my face.”

After all the preliminary tests on Bruno the plaintiff did not have enough money for a cochlear implant operation. For this reason and the difficulties with the business she returned to Vanuatu in January 1999. She did not go to Santo but stayed in Port Vila until the school holidays in May. She did not contact the defendant. The defendant says she was aware through talk the plaintiff had returned, but did not contact her.

On 13th May the plaintiff flew to Santo. She says the allegation of stealing was still made but despite denial her sister wouldn’t let her into the premises. She returned later with a brother but the defendant’s husband said she couldn’t come in. The next day the defendant’s reaction was the same, the plaintiff collected personal belongings and left. There were then two family meetings, the two sisters and the two brothers, but the matter was not resolved. The plaintiff said she wanted to continue being part of the business but the defendant would not let her.

The defendant says this is not correct. She did not know the plaintiff was coming on 13th May. The business had all sorts of problems since June 1998. She herself had been running it. When she saw her sister, she cried and asked her to swear in their parents name she had taken no money. The plaintiff refused to do this. The defendant didn’t want to talk to her. At no time was she refused access to the property or business. The meetings to resolve the problem were unsuccessful. The plaintiff decided to leave the business and property and return to Port Vila.

On or about 8th July 1999 the plaintiff and defendant signed a letter addressed to the Manager of the Hawaiian Bank (Annex 1 Defendant’s affidavit). It stated the plaintiff “is no longer a partner in the above-named business.” The defendant was “the sole owner and will be responsible for all debts owed by the above business.” The plaintiff was no longer a signatory on the account and forms.

The defendant says this clearly shows that the plaintiff withdrew from the business. The plaintiff says she only signed that to ensure she did not become liable for debts of the business when she had no control or access to it. It was done at the suggestion of her brothers and the bank.

These proceedings were commenced in July 2000.

The plaintiff says she is still part of the business. She was wrongly excluded from any access to it, continues to be wrongly excluded and seeks an account from June 1998 to date.

The defendant says, in effect, when the stealing became known, the plaintiff abandoned her interests in the business. The letter of 8th July 1999 is clear evidence of this. She did not exclude the plaintiff. Since June 1998 she herself has run the business. She says no account is required or justified.

When the father of the plaintiff and defendant made his provision for them he expected there would be harmony and the business be run as a family enterprise without formal agreements, profit sharing rules and the like. That harmonious state of affairs did exist from 1992 until 1998. It then broke down.

The central question is this. Did the plaintiff abandon her interest in the business or was she excluded? It is for the plaintiff to prove her case on the balance of probabilities.

Relations soured over the activities of the plaintiff’s husband soon after the plaintiff left for Hong Kong in July 1998. It must have been a difficult time for her. She had the responsibility of looking after Bruno and all that went with extensive medical checks and investigations. She was away from the business. Her husband, apparently without consulting her, took VT400,000 out of the business as deposit for a truck. He was also setting up a business in Vila. A few months later he was accused of stealing from the business. That stealing is denied.

On the face of the evidence of both parties the defendant was not excluding the plaintiff at that stage. She wanted her to return and sort it out. And in particular swear in their parents name the theft was not true.

The plaintiff did return to Vanuatu in January 1999. However, she stayed in Port Vila and made no attempt to contact the defendant. It was only after four months in May 1999 she returned to Luganville and that was with no prior warning to the defendant.

I find the defendant did not wish to exclude the plaintiff if the latter would take a solemn oath denying the alleged stealing. The plaintiff refused to do this. Attempts to resolve the impasse were unsuccessful. It was clear that the business could not be run by the two of them. The defendant had been running it for a year. The plaintiff had taken out substantive sums to go to Noumea, Australia and Hong Kong. She and her husband had the restaurant business in Port Vila. They signed the letter of 8th July.

That letter stated the plaintiff “is no longer a partner in the above-named business”. The defendant is “the sole owner and will be responsible for all debts owed by the above business”.

I do not accept the plaintiff thought this letter only released her from future liability for debts. Whilst the plaintiff’s English is not good, she can speak Bislama. She had jointly run a business for six years. The wording is clear.

Further, if what the plaintiff says is right, she is released from “all debts owed by the above business”, yet she would receive any benefits in terms of income and capital. I reject that situation.

I find this letter ended the business relationship. The plaintiff ceased to be a partner and gave up her interest in the business, the defendant became ‘sole owner’ but was responsible for all the debts. Whilst I do not have any accounts, the defendant’s evidence is that there were considerable debts and she had to work hard to keep the business going. I accept that whilst there is sympathy for the plaintiff and her desire to do her best for Bruno, considerable sums came from the business for them and also went out (VT400,000 unrepaid) to her husband. She did not work in the business for over a year.

Accordingly I dismiss claim 1, 2, 3, 5(a), 6, 7 and 8. I will make no order in respect of paragraphs 5(b) and 5(c) of the claim. I dismiss claim 4 in relation to joining “in the management and operation of the business”. The plaintiff is still a joint owner of the lease. The business is operated from those premises. The defendant and her family live on the premises.

Given the nature of the business, the way it was run, and my findings in particular that the defendant is the sole owner, I dismiss the counterclaim. In any event, any Order could not be enforced in any meaningful way.

If the parties cannot agree a resolution of the remaining claims in paragraph 4, 5(b) and 5(c), the Court will determine them upon application and with evidence.

The 22nd April at 10 a.m. is set for a conference to give directions concerning any outstanding issues and costs.

Dated at Port Vila, this 14th day of March 2003.

BY THE COURT

R. J. COVENTRY

Judge