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Karu Marine Export v Kuo Chi Chung & Kum Kee - Judgment [2006] KIHC 100; 24-06 (20 July 2006)

IN THE HIGH COURT OF KIRIBATI
Civil Jurisdiction
Held at Betio
Republic of Kiribati

High Court Civil Case No. 24 of 2006

Between:

KARU MARINE EXPORT
Plaintiff

And:

MR KUO CHI CHUNG
DAVID KUM KEE
Defendants

For the Plaintiff: Mr Karotu Tiba
For the Defendants: Ms Taoing Taoaba

Date of Hearing: 20 July 2006

JUDGMENT

The first defendant has left Kiribati and gone back to Taiwan. He has not been served with proceedings. The plaintiff has chosen to proceed against the second defendant.

The plaintiff, Karu Marine Export (or more properly Karu Marine Exports Ltd) is a company incorporated on 22 July 2005. According to the witness for the plaintiff, Karuaki Tangko, it is his business but his wife runs the company.

They (to use a neutral term) bought a truck from the Development Bank of Kiribati for $4,000. The receipt is in the name of Maereiti Reiate. There was no challenge to the value being $4,000 at the time of the events relevant to this action.

The first defendant, referred to by the witnesses as Fung Chung, was according to Karuaki, his employee. Mr David Kum Kee on the other hand said he had believed it was the reverse: Fung Chung was the owner of the business (and of the truck): Karuaki was his employee.

Karuaki said he had been driving the truck and David had seen him driving it. David on the other hand denied ever having seen Karuaki driving the vehicle: he had seen only Fung Chung driving it: he hardly knew Karuaki.

Karuaki decided to sell the truck, put it up for tender. He found a purchaser, Gabriel. Gabriel paid to Fung Chung a deposit of $2,000 which Fung Chung handed to Karuaki. Gabriel was told he could have the truck when he paid the balance of $2,000.

Fung Chung had the truck in his custody. Karuaki did not give him authority to sell nor did he hold out Fung Chung as having authority to sell but that is what Fung Chung purported to do: he sold it to David for $4,000. David paid $4,000 to Fung Chung. Fung Chung did not account to Karuaki for any of the money. In examination in chief David said he was not sure whether Fung Chung owned the truck or not: he did not see any documents regarding ownership and did not ask to see any. In cross examination he said he thought Fung Chung was the owner and made no further enquiries.

David used the vehicle only for a week or so. It broke down. There is talk that the engine has blown up. It is now behind Waysang Kum Kee’s house. It has been cannibalized: parts have been taken from it for use in other of David’s vehicles.

There are clear contradictions between the evidence of Karuaki and David. I prefer Karuaki’s version whenever there is a contradiction. The fact that Gabriel paid a deposit of $2,000 to Fung Chung who gave it to Karuaki implies that Fung Chung must have known that he had no authority to sell the vehicle to someone else. Yet he went ahead and purported to do what he was not authorized to do, sell the truck to David Kum Kee. Mr Kum Kee was at the least careless not to have made enquiries to satisfy himself as to ownership. I was told from the Bar table that it is not compulsory in Kiribati to notify change of ownership or to have a fresh certificate of registration issued. Yet not seeing any document of registration or ownership, David, not being sure if Fung Chung owned the truck, should have made more enquiries to satisfy himself of ownership.

Fung Chung had no authority to sell the truck: he could not give David Kum Kee title to it. The truck still belongs to the plaintiff.

The claim is for:

"(a) The return of the truck or in the alternative

(b) Value of the truck in the amount of $4,000"

What is to be done? Either David Kum Kee should return the vehicle, having put back into it the parts which have been used in his other vehicles (because he has no title to them either) or he should pay the plaintiff $4,000 and thus acquire title. The first alternative raises the question of the present value of the truck. I doubt if it can now be worth nearly as much as $4,000. So as well as returning the truck David should account to the plaintiff for the difference in value.

I shall publish these reasons and allow the parties time to make further submissions on the order I should make.

Dated the day of July 2006

THE HON ROBIN MILLHOUSE QC
Chief Justice