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Fiji Development Bank v Ravasua [2012] FJMC 260; Civil Case 454.2010 (21 September 2012)

IN THE MAGISTRATE'S COURT AT LAUTOKA

Civil Case No 454/10

BETWEEN

FIJI DEVELOPMENT BANK
Plaintiff

AND

1. PECELI RAVASUA
2. LAWACI BULOU RAVASUA

Defendants

JUDGEMENT

1. The Plaintiff Company instituted this action on the 27th September 2010 to claim a sum of $ 24,248.63 and interest from the defendants.
   
2. The statement of defence was filed on the 27th January 2011 and the case was taken up for hearing on the 22nd February 2012. A witness gave evidence for the Plaintiff and only the first Defendant gave evidence in this case.
   
3. It should be noted that the second defendant is the wife of the first Defendant and she is the guarantor of the loan obtained by the first Defendant. Although the second Defendant was preset in Court she did not file a separate notice of intention to defend or a statement of Defence. Further she did not give evidence as well. However the First Defendant informed Court that she will rely on the evidence of the first Defendant.
   
4. The Plaintiff's witness, Paula Rakai gave evidence that the Plaintiff Company granted a loan facility to the first Defendant for the sum of $ 40,525. He said that the 2nd Defendant executed a personal guarantee of the loan. The witness tendered Exhibits 1-9 to confirm the grant of the loan. He further said that the payment of the loan was satisfactory for sometime and later the Defendant started to default. Exhibits 10-17 were tendered to confirm that the first Defendant defaulted the repayment of the loan. The witness said then the Plaintiff had to reposes the vehicle which was purchased with the loan facility and to call for public tenders to auction it. He said that finally the vehicle had to be sold for $ 17,000 and the Exhibits 18-27 were tendered to confirm the sale of the vehicle and the circumstances under which it was sold for $ 17,000. The witness said that after remitting the proceeds of the sale towards the loan account the total outstanding as at 31st July 2010 was $ 24,248.63.
   
5. There was no dispute in this case regarding the obtaining of the loan facility and the default amount. The first Defendant admitted obtaining the loan facility and defaulting it. The first defendant's only contention was that he was not granted enough time to repay the loan by taking into account his grievances and that the vehicle was sold at an unreasonably low price.
   
6. I have considered the evidence of the Plaintiff and the first Defendant. Although the first Defendant alleged that he was not given sufficient opportunity to pay back the loan I cannot agree with his contention. The Exhibits 10-17 clearly shows that the Plaintiff has given ample opportunity for the first Defendant to repay the loan. Although the first Defendant expressed his grievances and the predicaments that he had to go through, it should be noted that banks do a commercial business and they cannot be expected to do charity work. Once a party arrives at an agreement to obtain a loan and to repay it in a specified manner, such party has to honour the agreement despite his or her personal difficulties. In this case the first Defendant's claim was that he could not repay the loan as the vehicle could not run for a long time due to mechanical problems. The Plaintiff too admitted that the vehicle was stationed for a long time due to mechanical problems. Further it appears that it is the very reason why the Plaintiff has afforded reasonable opportunities for the Defendant to repay it. However it should be noted that vehicles giving mechanical problems are not an unforeseeable circumstances and therefore it cannot be considered as a reason to default a loan repayment.
   
7. Be that as it may, the second contention of the first Defendant was that the vehicle was sold by the Plaintiff at a very low price. The plaintiff tendered documents to establish that they have taken adequate effort to sell it in a transparent and a reasonable manner. The exhibits 18-26 confirm the same. On the contrary the first Defendant did not produce any admissible evidence to establish that the said vehicle did worth more than $ 17,000 at the time it was sold. In the circumstances that contention too fails.
   
8. Therefore I am satisfied that the Plaintiff has proved on a balance of probability that the Defendants are jointly and severally liable to pay $24,248.63 to the Plaintiff Company.
   
9. The Plaintiff sought 10.1% per annum from the 1st August 2010 till the date of the judgement. However I am not satisfied about this rate as it was not clearly explained by the Plaintiff as to how they arrived at the said interest rate. Further I have considered the amount already paid by the first Defendant and other circumstances submitted by the first Defendant. Having regard to all those circumstances I decide to limit the interest rate to 5% per annum from the 01st August 2010 until the date of the full payment.
   
10. Accordingly the following orders are made;
    
    1. I enter a judgement against the first and the second Defendants jointly and severally in the sum of $ 24, 248.63
       
    2. I order interest at the rate of 5% per annum from the 01st August 2010 until the full payment.
       
    3. I summarily asses the cost of this action to be $ 300.
       

Rangajeeva Wimalasena
Resident Magistrate
Lautoka

21.09.2012