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Craig Construction Company Ltd v Yuxiang [2007] WSSC 75 (10 October 2007)

IN THE SUPREME COURT OF SAMOA
HELD AT APIA

BETWEEN:

CRAIG CONSTRUCTION COMPANY LTD
a duly incorporated company having its registered office at Ululoloa.
Plaintiff

AND:

LI YUXIANG Businessman
of 19 Yaofeng Sought Road, Ningbo, China 315010
First Defendant

AND:

PACIFIC CASHMERE COMPANY LIMITED
a duly incorporated company having its registered office in Samoa.
Second Defendant

AND:

HUANG CHIENCHUN
trading as WONG ENTERPRISES
Third Defendant

Counsel: J J Brunt for plaintiff
L Tuala-Warren for first, second and third defendants

Judgment: 10 October 2007

JUDGMENT OF SAPOLU CJ

The present proceedings are concerned with a motion by the defendants to rescind an interim injunction which was granted ex parte to the plaintiff. I regret the delay in delivering this judgment. I had found the facts alleged in the plaintiff’s motion for an interim injunction, affidavit of 22 September 2006, and statement of claim rather complex to follow. It is not necessary to set out the details of that complexity.

The relevant facts as may be gathered from the plaintiff’s, first defendant’s and third defendant’s documentations may be stated as follows. The plaintiff is the owner of a building situated at Vaitele including the fixture assets, equipment and machines situated therein. This building is on leased land and was occupied and used by the second defendant, a Chinese garment company owned by the first defendant who is also one of its two directors.

The first and second defendants have left Samoa leaving behind the said building together with the fixture assets, equipment and machines situated therein (hereinafter referred to collectively as “the building”). By an e-mail letter dated 07 August 2006, the first defendant offered to sell the building to the plaintiff for $750,000. The said e-mail letter was apparently sent from China by one John Lee to the plaintiff but at the end of the e-mail following the words “I’m looking forward for your reply Best regards” is the name of the first defendant. This suggests that even though the said e-mail was sent by John Lee, it was the first defendant’s email. By an e-mail letter dated 16 August 2006 from the plaintiff in Samoa to the first defendant, the plaintiff acknowledged receipt of the first defendant’s e-mail of 07 August 2006 and advised its acceptance of the first defendant’s offer. In the same e-mail, the plaintiff also requested the first defendant to prepare the necessary sale and purchase agreement for the building. Then by an e-mail letter of 25 August 2006, the first defendant acknowledged receipt of the plaintiff’s e-mail of 16 August 2006 and suggested that the plaintiff prepared the sale and purchase agreement because of its familiarity with local conditions. This second e-mail from the first defendant was also sent by John Lee with the name of the first defendant appearing at the end of the e-mail immediately following the words “Looking forward to your reply Thank you! Best Regards.” To all intents and purposes, it would appear that the exchange of e-mails between the plaintiff and the first defendant constituted an agreement between the plaintiff and the first defendant. So on 28 August 2006, the plaintiff instructed its solicitor to prepare the necessary formal sale and purchase agreement. It was around this point in time that the third defendant became involved in this matter.

On 31 August 2006, the third defendant presented himself at a meeting held in the office of the plaintiff’s managing director as the lawful attorney of the first defendant. At that meeting the third defendant sought to vary the first defendant’s original offer of $750,000 to $900,000 as the price for the building. The plaintiff’s managing director in his affidavit of 22 September 2006 says that he then made a counter offer of $800,000 which was accepted by the third defendant. In his affidavit of 04 October 2006, the third defendant denies that he accepted the counter offer of $800,000 and says that he told the plaintiff’s managing director that he would think about it and then left.

Annexed to the third defendant’s affidavit of 04 October 2006 is a power of attorney from the second defendant which entrusts full power to the third defendant “to handle all matters concerning the company’s account settlement, closure, debts and right”. However, in paragraph 2 of the plaintiff’s statement of claim it is pleaded that the first defendant is the owner of the building and that is admitted by all the defendants in paragraph 2 of their statement of defence. It is therefore arguable that the power of attorney given by the second defendant to the third defendant does not extend to the building because the second defendant it is not the owner of the building but the first defendant. However, the matter becomes confusing because the first defendant in his affidavit of 16 January 2007 says that the building belongs to the second defendant.

Be that as it may, the first defendant in his affidavit of 16 January 2007 says that he is one of the two directors of the second defendant company and that the third defendant is not his lawful attorney and shall cease to represent himself as such. He also revoked the power of attorney on which the third defendant purports to rely and says that he authorises John Lee to continue to act on his behalf in all matters relating to the sale of the building. He also says that the final agreed purchase price for the building is $800,000 and that he has forwarded the draft sale and purchase agreement to the plaintiff with his comments and amendments. When I saw both counsel in chambers on Monday, 8 October 2007, counsel for the plaintiff advised that a revocation of the power of attorney given to the third defendant has already been registered.

As it appears clear from the submissions by both counsel, the dispute has centred on whether the plaintiff had entered into a binding sale and purchase agreement with the third defendant who claims to be the lawful attorney of the first defendant. This is notwithstanding the fact that only a few days before the plaintiff first met with the third defendant, the first defendant had agreed to sell the building to the plaintiff.

Given that the power of attorney on which the third defendant relies as his source of authority has been revoked and that revocation as advised by counsel for the plaintiff has been registered, the third defendant no longer has authority to act for the first or second defendant in relation to the sale of the building. It is also doubtful whether the third defendant ever had authority to act for the first defendant because of what the first defendant says in his affidavit of 16 January 2007 that the third defendant is not his lawful attorney. The power of attorney on its face also shows that it was from the second defendant and not the first defendant even though the third defendant represented himself as the lawful attorney for the first defendant. In these circumstances, I have decided not to rescind the interim injunction which has been granted to the plaintiff.

CHIEF JUSTICE

Solicitors: Brunt Keli Law Office for plaintiff
Tuala & Tuala Law Office for first, second and third defendants