NOMINAL DAMAGES

Poverty Bay Herald, Volume LXIV, Issue 19336, 28 May 1937, Page 13

NOMINAL DAMAGES

INJUNCTION REFUSED FISH SHOP PARTNERSHIP JUDGMENT FOR PLAINTIFF Nominal damages of £ls were awarded to-day to Theodore Nicholas, plaintiff m a hearing which occupied the attention of the Chief Justice, Sir Michael Myers, during the whole of yesterday's sitting of the Supreme Court at Gisborne. His Honour held that Nicholas, who cl?umed £6OO damages from Dominico Moleta. in respect of a breach of a partnership agreement, and also an injunction restricting Moleta from participating in any restaurant, business in Gisborne, had failed to prove substantial damages. The award was made to cover expenses incurred by the plaintiff as a result of defendant repudiating the partnership. His Honour refused the application for an injunction against the defendant Moleta.

The case arose out o[ transactions in respect of fish retail businesses in Gisborne, plaintiff and defendant having entered into a partnership to buy the Imperial. Cafe, and defendant subsequently withdrawing from the partnership, while plaintiff made arrangements for an amalgamation of his retailing interests with those of his chief competitors. It was indicated in the course of evidence that Moleta had recently returned to Gisborne*and, in partnership with another man, had opened n restaurant in competition with the amalgamated interests. Mr. L. T. Barnard represented the plaintiff. Theodora Nicholls, and Mr. G. J. Jeune the defendant, Domuuco Moleta. Evidence in the case was concluded yesterday, and His Honour intimated that judgment would he given to-day. His Honour’s Judgment

Stating his decision, the Chief Justice said that the partnership had been proved, and also the fact that defendant had committed a breach of that agreement. The plaintiff was therefore entitled to damages, provided that loss could be proved; if damage was not proved, then pluintiff would be entitled to only nominal damages. His Honour was not satisfied that any substantial damages hacl been proved. Plaintiff might have taken steps to wind up the partnership, but instead of doing so, he had accepted defendant’s repudiation and had made arrangements on an entirely different basis to form another company. In that operation, he dealt with the property purchased for the prior partnership as though it was his own property; moreover, he actually disposed of three quarter-shares in that property. He thus recovered the amount which defendant would otherwise have been obliged to pay as his contribution to the partnership. He had also dealt with the Imperial Cafe property in such a way that it could not conflict with the interests of his new company. How in all these circumstances it could be said that plaintiff had suffered substantial damages, His Honour could not see. The plaintiff said that lie suffered substantial loss, but he condescended to give no details. His Honour thought that, having joinect-with his former business rivals and—quite legitimately-stifled competition in the fish trade in Gisborne, plaintiff might even be better off than under the partnership which defendant bad repudiated. On the subject of the injunction claimed by plaintiff against Tlefendant, His Honour intimated that there was nothing in the partnership, according to his reading of the document, which restricted the actions of the defendant, after the partnership expired. The partnership had been determined, therefore defendant was freed from the negative covenant regarding operations outside the business for which the partnership was forined. , . . Judgment would be for plaintiff for £ls, to cover the expenses he had incurred over the partnership anthe substitute arrangements, His Honour allowing £lO 10s costs, with witnesses expenses and disbursements. Case for the Defence When the Herald went to press yesterday, the hearing progressed as far as the opening of tho case lor the defence. Mr. Jeune called the defendant Dominico Moleta, who stated that Nicholas had assured him that the Regent La lb could not compete with the Imperial Cafe if the latter was supplied with fiah from Nicholas’ boat, practically without cost, and with the backing oi • Nicholas in case the business went back. After signing the agreement and taking over the Imperial Cafe, witness hud become perturbed, and on consulting with a solicitor, he had for the lust time understood the full meaning of the document. He then repudiated the partnership, and Nicholas took up the matter of the amalgamation with the Regent Cafe. It was proposed that Nicholas and liis brother, Robert Zame, and the witness were to be the four partners in the amalgamation. In the following week, witness carried on at the Imperial Cafe, taking the daily returns to Nicholas, and waiting for the new amalgamation to develop. He then became suspicious ovrihg to Nicholas and Zame excluding him from their discussions. Witness was then staying at Nicholas home, and one night Nicholas offered him the whole of the Imperial business, witness refusing because lie had no funds. Nicholas later demanded £260 from him, and had then declared that he would come back for £IOO, ordering witness out. Witness got out and four days later returned, going to Nicholas’ .house to tax him with having told people lie had taken money from the till. The company was then formed, and Nicholas suggested that if he gave £BSO. witness could be a partner. Witness went away again for a year, and returned to open a restaurant in Gisborne in partnership with a Wellington man. Cross-examined by Mr. L. T. Barnard, the witness said lie did not realise that he had a very bud bargain until his solicitor explained it to him. It was a bad bargain for him but a good one for Nicholas. Oil finding this out. witness intimated that he would not go on, his ' lawyer having pointed out that he was free to clear out. Ho had suggested buying the Regent out. as a means of getting out of the difficulty. Witness stated that he had known nothing of a letter sent by Mr. Beaufoy to his solicitor, demanding £SOO on March 3. He had not removed his bags by stealth from Nicholas’ place, as they had been at the Imperial Cafe all the '•wetSk. Nicholas knew that lie was going, because of his having repudiflip flpfll f Counsel asked whether it was not. the case that when Nicholas showed jjjt that he was after him, lie cleared ° U Withoss said lie knew Nicholas was after his money. Ho had expected . to be a full partner in the amalgamation, but he nnd to get out. Evidence by Accountant • 'Wallace Fountain, accountant, who it;'kept the hooks of Gisborne Fisheries, .v Limited,- said that he was advised of t the. proposed amalgamation between $ Nieholas and the Regent proprietors, Li *hh§ being oil the Monday oil which

Nicholas and .Moleta took possession of tho Imperial Cafe. That evening he had been requested to value tho shares of ono of the Regent proprietors. Witness had subsequently assisted in valuing and taking stock of the amalgamating businesses. Jack Ilaisman, accountant, also gave evidence of having been called into valuations and stock-takings, and stated that he had not valued the businesses in detail. No further evidence was called, and Mr. .Teune intimated that he would not address the court.

Mr. Barnard addressed His Honour on the matter of damages, and on the law relating to the injunction claimed. His Honour, in the.course of discussion with counsel for plaintiff, expressed his opinion that the plaintiff had taken the wrong course from the start. He should have proceeded for a winding-up of the partnership. Mr. Burnard held that that, was not necessary where the repudiation of the partnership was accepted. His Honour conceded that this might be so, but if counsel went for damages for repudiation, he could not press the claim for the injunction. Mr, Burnard argued the question of damages further, and His Honour commented that damages, of course, could be claimed if they could -be shown.