Feud deepens in Supreme Court
The bitter row between two senior H.R.P.P members, Peseta Vaifou Tevaga and La’auli Leuatea Polata'ivao, continued before the Supreme Court this week.
This time, the latest twist in the long-standing dispute sees Peseta and his lawyer, Leuluaiali’i Olinda Woodroffe, asking the Court to remove a Court-appointed Manager for Local Partners and Associates Company.
Peseta is up against La’auli, the Minister of Agriculture and Fisheries, and Apulu Lance Polu and Martin Schwalger.
With Justice Lesatele Rapi Vaai presiding, Semi Leung Wai is representing La’auli and other shareholders of Local Partners.
On Wednesday, Leuluaiali’i argued that interim Manager, Tagaloa Fa’afouina Su’a, should be removed for reasons he has not done anything to develop the company financially since his appointment by Court on December 2015.
But Mr. Leung Wai opposed the motion.
“Tagaloa wrote twice to the Court to explain the financial situation of the company,” he told the Court.
“In December last year, lawyer Leali’ifano Iopu Tanielu who was representing Leulua’iali’i at the time met with Semi and Lesa to discuss the appointed Court manager’s letter in regards to the financial situation of the company.
“Therefore give Tagaloa a chance to respond because as I understood Tagaloa has not been served with the letter discussed by Leulua’iali’i.”
But Leauluaiali’i wants her client, Peseta, to take over as Interim Manager.
According to a sworn affidavit by Peseta, he argues that the Court-appointed Manager has acted in breach of his duties and has failed to act in the best interests of the company.
“The plaintiff submits that the Court-appointed manager has failed to exercise the care, diligence and skills of a reasonable Court-appointed Manager. The Court-appointed manager has failed to act in the best interest of the company local partners, as is evidence by the following facts:
“By Order of the Supreme Court dated 21 December 2015, Tagaloa Fa’afouina Su’a (hereafter “the Court-appointed Manager”) was duly appointed the interim manager who will be responsible for the daily administration and financial affairs of the Second Plaintiff; Local partners and Associates Ltd.
“The first Defendant was to be provided by the first defendants, within 14 days from the date of the order, financial statements of the second plaintiff since incorporation in 2013.
“It is implicit in the Court order that the Court-appointed Manager had the right and power to request other information, particularly the information’s relating to payments of the products sold and hire of property, from the first defendants. (see paragraph (4) of the Court Order).
“Approximately a year after the Court-appointed manager was appointed, the manager wrote to His Honour Justice Va’ai by letter dated 19 December 2016 providing a “brief” update of the current situation of the Company’s affairs.
“In paragraph 1, the Court-appointed Manager said that the Company’s Account (0712833001) with Samoa Commercial Bank (SCB) has insufficient funds to pay operating expenses.
“The Court-appointed a mangers’ letter of the 19 December 2016 is unprofessional, as it is full of self-assertions without any evidence to prove the statements given to the Court by way of a “brief” update.
“In paragraph 1of the said letter, written approximately a year after his appointment, the Court-appointed manager made assertions with no evidence in support of his assertion, in paragraph 1 of his letter of the 19 December 2016, saying that: “From October 2016 to date the directors Apulu Lance Polu and La’auli Schmidt have been paying from their own funds, wages of the skeleton staff required to maintain the Vaitele factory and Savai’i storage depots at Salelologa and Fagae’e including utility costs such as electricity, water bill etc.”
“With respect, these unsupported statements, shows poor management, lack of care and attention, recklessness and failure in his obligations to act in good faith and in the best interest of the company.
“The plaintiff submits that the Court appointed manager had a duty to notify the Court and all the Directors of the Company of the financial position of the Company in October 2016, if what he says is correct.
“He had a duty to act in good faith to all persons including the plaintiff. The manager breached his duty to act in good faith, by working “closely with Poly and La’auli Schmidt”, and deliberately left the plaintiff uninformed.
The plaintiff was never informed. La’auli Schmidt is not a director of the Company, Local Partners and Associates (Second Applicant/Plaintiff).”
Leuluaialii and her client also questioned the payments for the sale of nonu juice in May and October last year. They claimed that the payment was stored in a different account.
“The Court-appointed Manager, “aided and abetted” in continuing wrongdoings committed by the first and second Defendants, Apulu Lance Polu, Martin Schwalger and La’auli Leuatea Schmidt.
“After his appointment in December 2015, an order for 20,000 litres of Nonu Juice was provided to ZhongSa (Xiamen Investment Co. Ltd, China. The Chinese Company was Invoiced USD$47,400.00 by Samoa Nonu Delight, Vaitele, Apia Samoa.
“There is no evidence provided to the Court in the letter by the Court appointed Manager, in his letter dated 19 December 2016, to explain why an order “provided by”, and “using Nonu Juice of the Local Partners and Associates” is been invoiced under the name “Samoa Nonu Delight” (see exhibit “B” of the plaintiff’s affidavit of 20 December 2016).
“The question is: Did the money received from this order of the 3 May 2016, go to the account of Local Partners and Associates at SCB? Mrs Woodroffe asked this same question, to the Court-appointed Manager, Fa’afouing Su’a, but Mr Su’a refused to answer this question.
“The plaintiff submits that the Court-appointed Manager misled the Court by his statement in paragraph 1 of his letter of 19 December 2016, wherein he said (without evidence) that:
“...from mid October 2016 to date, the directors Apulu Lance Poly and Hon La’aulialemalietoa Leuatea Schmidt have been paying from their own funds, wages of the skeleton staff required to maintain the Vaitele factory and Savai’i storage depots at Salelologa and Fagae’e including the utility costs such as electricity, water bill etc..”
“I refer your Honour to Attachments to paragraphs 3,4,5 and 6 of the plaintiff’s affidavit sworn on the 20th December 2016. The said attachments provide evidence of substantial sums of money being paid for the supply of NONU Juice to companies, outside of Samoa, on the 3 May 2016; 30 October 2015; 7 December 2015; 13 October 2015.
“In the absence of any evidence to the contrary, the Nonu Juice is believed to be the Nonu Juice belonging to, and supplied from the Nonu Juice of the second defendant, the Local Partners and Associates.
“However, Invoices and payments are issued under a variety of different names. Cash payments are paid to/or are received by persons, who are not Directors of Local Partners and Associates, for example, in paragraph 3.9 of the plaintiffs affidavit, sworn on the 20 December 2016, he attached as Exhibit “J” a copy of a receipt 838538 dated 27/7/2015, evidence of cash payment of $34,383-82 sene, made to Heather Schmidt.
“All evidence of payments made for Nonu Juice in late 2015 and in 2016, adds up to a substantial sum of money paid to various Banks and people. The people who controlled, directed and received these substantial sums of money were Apulu Lance Polu, and Hon La’aulimalietoa Leuatea Schmidt.
“Taking the evidence referred to in paragraph 2.5 above, the plaintiff respectfully submits that the Court-appointed Manager has either turned a blind eye to payments being paid for Nonu Juice, to accounts other than accounts of Local Partners and Associates, or it can be constructed that he failed in his duty to act in the best interest of Local Partners and Associates; or he has “aided and abetted” in the wrongdoings of Apulu Lance Polu and Hon La’aulimalietoa Leautea Schmidt.
“The Court-appointed manager had a duty to provide evidence to support his allegations in paragraph 2 of his letter. He failed to do so, but made statements that showed his lack of professionalism in the carrying out of the duties allocated to him by the Supreme Court.
“In paragraph 3 of the Managers letter, the Court-appointed Manager said that he was unable to prepare the accounts in a “rushed” manner.
The Court-appointed Manager had a whole year from December 2015 to December 2016, to collect, assess and inform the Court of the position of Local Partners and Associates. He has failed to do so.
The Court-appointed managers failure, has led to the proclaimed financial difficulties of Local partners and Associates referred to in paragraph 1 of the Court-appointed Managers letters of 19 December 2016.
“Finally, we refer to paragraph 6 of the Court-appointed Managers’ letter of the 19 December and endorse his statement that Local Partners and Associates Nonu juice business is a potentially rewarding investment.
The plaintiff submits that the Court-appointed Manager has contributed to Local Partners and Associates, “bleeding financially” but his failure to act in good faith, failure to act in the best interest of the Company, and by his failure to act independently of Apulu Polu and Hon La’aulimalietoa Leautea Schmidt.”
Mr. Leung Wai objected to the appointment of Peseta as an Interim Manager.
Justice Lesatele has adjourned the matter until 30 January 2017 to set a hearing date.