Court awards $778,009 to Samoa Breweries

By Joyetter Feagaimaali’i-Luamanu ,

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Court victory for Vailima. (inset) Supreme Court Justice, Tafaoimalo Leilani Tuala-Warren.

Court victory for Vailima. (inset) Supreme Court Justice, Tafaoimalo Leilani Tuala-Warren.

Supreme Court Justice, Tafaoimalo Leilani Tuala-Warren, has awarded Samoa Breweries Limited (S.B.L.) $778,009 in a civil claim.

This is in connection to a breach of contractual obligations.

According to the ruling, S.B.L. and Queen Maggie Transport Limited entered into a Product Distribution Agreement in May 2009. 

The agreement indicates that Queen Maggie would be the authorised distributor of S.B.L. products in Savai’i. This means exclusively selling and marketing all S.B.L. products. 

The first defendants’ names are Loliosa and Luisa Ah Kuoi of Queen Maggie and their son, Magele Fiti. 

As part of the agreement, the distributor collects and returns to S.B.L. empty bottles, containers or crates used to sell and deliver S.B.L. products. 

The process is that trucks from the distributor would bring these empty products with a signed distributor’s invoice that shows the total number of crates and empty products being delivered. 

S.B.L. employees will then count and prepare a Returned Empties Note Form stating the type and number of bottles returned. 

The form is then given to the finance section of S.B.L. and this section credits the distributor’s account with the monetary value of the returns. 

The distributor’s account is a credit account with S.B.L. for the purchase of products by a distributor, which is lessened each time by the monetary value of returns. 

Sometime in early 2012, S.B.L. noticed an anomaly in the empty bottle return numbers from the distributor. 

Startled, it was the beginning of an investigation by S.B.L. which led to the Police laying criminal charges against Mr. Fiti.

He pleaded guilty in the District Court and was convicted in 2014 of five counts of conspiracy to defraud.  

The S.B.L. proceeded with a civil claim to recover its loss against Loli and Luisa and Mr. Fiti to the tune of $1.46 million. 

Justice Tafaoimalo pointed out there is no question that there are criminal charges to which M.F. pleaded guilty. 

Those criminal charges were conspiracy to defraud. Mr. Fiti has conceded that he is liable for the loss, which is $26,096.89 that arose out of those five charges.

 There is no need for a lengthy analysis given this concession. He is therefore liable to the plaintiff in the amount of $26, 096.89.

“The issue of the invoice originals is not to impact on the plaintiff’s claim. Those were misplaced by the Court having been submitted by the plaintiff. It is not fair or just for the plaintiff to be penalised for the Court misplacing the originals of the invoices. 

“I proceed on the basis that the originals are known to be in existence, but the production of those originals for practical purposes is impossible because they cannot be found after due search in the Court. 

“I am satisfied to proceed on the photocopies of the invoices being the best evidence available to the Court.

“The plaintiff has rightly adjusted its claim based on invoices which have no signatures (on photocopied version), missing invoices and the invoices which are not signed by Magele Fiti. 

“These invoices cannot be part of this claim. The actual invoices signed by MF come to a total monetary sum of $2, 245,917. 

“The plaintiff has given to Q.M. the benefit of a 100 percent return rate, i.e. every bottle they uplifted to take to Savaii was returned. 

“The value of this return is $1,467,908, which deducted from the actual invoices, brings the total amount claimed by the plaintiff to $778,009. I proceed on this claimed amount of $778,009.” 

The Supreme Court Justice pointed out the defendants have suggested that the excess is from a product which Savaii consumers and retail outlets take to Savaii themselves. 

“This is hard to accept given the convenience of having the distributor in Salelologa, Savaii, saving time and expense for Savaii consumers, and in particular given the quantity of the excess. 

“The evidence reveals an excess of 43,000 crates for the six months from June 2010 to December 2010, an excess of 120,000 crates from January 2011 to December 2011, and an excess of 52,000 crates from January 2012 to April 2012. 

“This is over and above all the bottles uplifted by Q.M. being accounted for. These numbers are staggering and cannot in any conceivable way be explained away to the satisfaction of the Court.”  

Justice Tafaoimalo stated the court was satisfied that the false representations made by Mr. Fiti to S.B.L. took the exact same form as the incidents in 2012 to which Mr. Fiti pleaded guilty. 

“He signed off on invoices which contained false representations of returned empties knowing full well that the actual returns in their trucks did not correspond with the invoices. 

“Magele Fiti was fully engaged in this false representation to S.B.L. well before he was charged with the five occasions to which he pleaded guilty. I am satisfied that Magele Fiti made false representations to S.B.L. from June 2010 to April 2012.

“Whether Magele Fiti knew the representation was false and intended that S.B.L. should act in reliance on it.

“Magele Fiti says that towards the end of 2011, he was asked by S.B.L. employees to borrow money to pay balances of the N.P.F. so that they could be entitled to loan. 

“He gave them the money and these were not small sums of money. When his parents came back in December 2011 from New Zealand, he asked the employees to repay their loans. 

“They could not repay, but asked that he sign a clean return empties note so that they could complete it with a full supply of empties and credit it to Queen Maggie’s account as repayment.” 

Justice Tafaoimalo did not accept Mr. Fiti’s explanation that he was not involved in any other wrongdoing apart from the five incidents for which he was charged. 

“His modus operandi or distinct pattern or method of operation is evident in the evidence of the plaintiff that showed the higher rate of return than of uplifts. Even with the concession of all uplifts being accounted for, the returns still exceed, by a significant amount, that concession.

“I am satisfied that S.B.L. did act in reliance on the representations on the invoices by paying the monetary value of the returns into Queen Maggei’s account.

“They are not defendants to this claim and therefore any invoices signed by them cannot form part of the claim against Magele Fiti. 

“There were missing invoices and invoices whereby the signatures were missing from the photocopies. These also cannot form part of the claim. It is only the actual invoices signed by Magele Fiti which can be claimed against him.

“There is no doubt that the deceit by Magele Fiti caused loss to the plaintiff. 

“I deal with the latest amendment to the amount of the claim, which is $778,009. 

“The reason for the amount is that the actual invoices signed by M.F. came to a sum of $2,245,917. 

“The return rate credit given by S.B.L. which is crediting every bottle uplifted is $1,467,908. 

“The difference comes to $778,009. This is an extremely generous concession.” 

Accordingly in this case, Mr. Fiti’s liability has resulted in the first defendants being vicariously liable for the loss to S.B.L.

© Samoa Observer 2016

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