5ASR3d96

PAULO MOANA, Plaintiff,

 

v.

 

PAGOFIE FIAIGOA, Defendant.

 

High

Court of American Samoa

 

Trial

Division

 

CA

No. 114-00

 

May

23, 2001

 

 

[1] American

Samoa law does not recognize a contract for the sale of real property unless it

is in writing, or has been partially performed.

 

[2] The writing

required by the statute of frauds may be a note or memorandum subscribed by the

party to be charged.  It need not be a

formal document.

 

[3] A note or

memorandum documenting the sale of real property should completely evidence the

contract that the parties made by giving all of the essential or material terms

of the contract.

 

[4] If the

parties have not reduced the essential terms of a land conveyance to writing

but have partially performed the contract, A.S.C.A. § 37.0211 authorizes the

court to enforce the oral contract. 

 

[5] The court

has the explicit power to compel specific performance of a partially performed

contract.

 

[6] To justify

rescission, a breach of a contract must be so substantial and fundamental as to

defeat the contract’s purpose.

 

[7] Where the

parties do not agree on a specific time for performing obligations under a

contract a reasonable time will be implied.

 

[8] Where seller

failed, after two month’s time, to produce a written contract to document the

real estate sale and instead attempted to raise the agreed upon price, seller’s

breach was substantial enough to defeat the contract’s purpose and entitled

purchaser to rescind contract and recover, as compensatory damages, monies paid

towards purchase price and survey.

 

[9] Where,

after making agreement to sell land, seller wrongfully failed to perform his

side of the bargain in an expeditious manner, and instead attempted to increase

purchase price, such misconduct was deliberate, reprehensible and entitled

purchaser to exemplary damages.

 

Before RICHMOND, Associate .Justice,

LOGAI, Chief Associate Judge, and SAGAPOLUTELE, Associate Judge.

 

Counsel:   For Plaintiff, David P. Vargas

               For Defendant, Pro Se

 

OPINION

AND ORDER

Plaintiff Paulo

Moana (“Moana”) brought this action to recover damages against defendant

Pagofie Fiaigoa (“Pagafie”) for alleged breach of contract and fraud.  Trial was held on April 6, 2001.  Moana, his counsel, and Pagofie ware

present.  The Court heard testimony and

has considered the evidence.

 

Discussion

 

Facts and Contentions

 

Moana is a

citizen of Samoa but a long-term resident of American Samoa.  Moana and Pagofie have known each other for a

number of years, and Pagofie was aware of Moana’s citizenship.  Moana wanted to purchase land here for his

home, and he heard that Pagofie was selling land located in Tafuna near where

Moana’s in-laws had earlier purchased land from Pagofie.

 

Pagofie and Moana

met on February 14, 2000 and made an oral agreement under which Pagofie agreed

to sell to Moana, and Moana agreed to buy from Pagofie, a quarter acre parcel

of land in Tafuna for $40,000.  Under the

terms of the agreement, Moana paid $5,000 as a down payrnent and was to pay

$500.00 by the end of each month, starting in March 2000, until the purchase

price was paid in full.  Pagofie would then convey title to the land

by deed to Moana as individually owned land.

 

The down

payment was paid by a

business check of S&T Produce Co., owned by Siufaga Fanene (“Fanene”), a

gift to Moana for lengthy service as an employee of Fanene’s business.  The check was payable to Pagofie. The purpose

line on the check reads: “Down for Paulo Moana’s 1/4 Acre Land.”  Pagofie was hesitant about taking a check of another’s business

for this purpose, but he knew Moana’s relationship with Fanene and did accept

it.

Having been so

advised by Fanene, Moana told Pagofie that the agreement must be put in

writing, and Pagofie agreed to have the paperwork prepared by his

attorney.  Before the end of February

2001, Moana called Pagofie several times to ask about the paperwork, and

Pagofie kept assuring him that it would be ready the next day.  Finally, Moana went to see Pagofie, and

Pagofie told him not to worry because the paperwork would be forthcoming.  Pagofie also gave Moana permission to build a

house on the land before payment of the purchase price was complete.

 

On March 27,

2000, Moana again called Pagofie, who once more assured him the paperwork would

be done.  On March 28, 2000, relying on

Pagofie’s word, Moana paid Pagofie the first monthly installment of $500, plus

$400 for a survey of the land.  This payment

of $900 was made by a cashier’s cheek payable to Pagofie.  The bank’s receipt for the check bears the

notation: “From Paulo Moana $400 Land Survey $500 1st Payment.”

 

As the deadline

for the April installment approached without any paperwork produced, including

a survey of the land, Moana was increasingly concerned about Pagofie’s

intentions.  Then, on April 26, 2000, Pagofie told Moana that

the purchase price of the land would be increased by $5,000 to $45,000.  Moana refused to agree to this increase.

Believing that Pagofie never intended to carry out the agreement, Moana also

advised Pagofie that he no longer wanted to buy the land and demanded that

Pagofie refund the $5,900 he had paid to that point. Pagofie refused to refund

the monies paid, and this action was filed upon his continuing refusal to do

so.

 

Based on his

understanding of the change in the law in l999, Pagofie said that he thought

Moana as an alien could not acquire title to land in American Samoa.[1]  He claimed, however, that he expected the title

would be put in the names of Moana’s children who were born here.  Pagofie also acknowledged that the land was

his family’s communal land, not his individually owned land, but according to

him, he as the sa`o of the family did obtain his family’s consent to

convert the land to individually owned land and consummate the

transaction.  Pagofie stated that he

explained both of these matters to Moana in February 2000.  Moana denied that Pagofie made any such

explanations.

 

Pagofie

apparently gave the funds paid by Moana to his mother and other family members

to spend.  He insisted that he intended

to perform the agreement, and that he is still prepared to do so.  He testified that the delay initially came

about because he was still looking for an attorney to prepare the paperwork and

a surveyor to survey the land.  He

claimed that Moana breached the agreement by not paying the April and May

installments, and that Moana confirmed the breach in June 2000 when he informed

Pagofie that Fanene had promised Moana land for his home at no cost.  However, Fanene actually made this offer to

Moana only about two or three months before the trial, well after the deal

soured.

 

Pagofie

testified that he did not return the funds paid by Moana because Moana did not

truthfully promise to pay the purchase price for the land and because he,

Pagofie, spent considerable time, including efforts to persuade his family to

sell the land, on the proposed transaction. 

He argued that he will still honor the agreement, and because Moana broke

his promise to pay, he should, in any event, be permitted to retain at least

25% of the amount paid.

 

Although the

parties do not dispute the existence of an oral land conveyance agreement, the agreement must fulfill certain

statutory requirements to be valid. 

Accordingly, we next discuss the applicability of these requirements to

the agreement at issue in this case.

 

A. 

Statute of Frauds

 

[1-2] American Samoa law

does not recognize a contract for the sale of real property unless it is in

writing, or has been partially performed. A.S.C.A. § 37.0211.  The writing prescribed by statute, commonly

known as the statute of frauds, calls for “some note or memorandum . . .

subscribed by the party to be charged.”  Id. 

The writing need not, therefore, be a formal document.

 

[3] Nonetheless, the note

or memorandum should “completely evidence the contract which the parties made

by giving all of the essential or material terms of the contract.”  72 Am

Jur 2d Statute of Frauds § 339 (1974).  In Cousbelis v. Alexander, the court

concluded that notations on a check were sufficient to satisfy the statute of

frauds.  54 N.E.2d 47, 48-49

(Mass. 1944).  The parties to the

contract were the payee (seller) and drawer of the check (buyer); the seller

cashed the check, which on its face noted the land’s street location, the only

land owned by the seller, and the land’s square foot price.  Id.; see also Kidd v. Kidd,

393 P.2d 403, 405 (Cal. 1964) (finding decedent’s signed receipt combined with

two checks totaling agreed upon purchase price satisfied the statute of

frauds).

 

[4-5] On the other hand, if

the parties have not reduced the essential terms of a land conveyance to

writing but have partially performed the contract, A.S.C.A. § 37.0211

authorizes the Court to enforce the oral contract.  We have recognized the Court’s explicit power

to compel specific performance of a partially performed contract.  Manoa v. Jennings, 21 A.S.R.2d

23, 25 (Land & Titles Div. 1992); see also Blue Pac. Mgmt. Corp. v.

Paisano’s Corp., 23 A.S.R.2d 58, 62 (Trial Div. 1992).

 

Arguably, the

notations on the down payment check and cashier’s check, coupled with Pagofie’s

endorsement on the down payment check, are sufficient evidence of this land

purchase agreement to validate the agreement for purposes of A.S.C.A. §

37.0211.  However, we need not rule on

the sufficiency of the writings. 

Instead, we find that based on the facts of this case, Moana’s payments

constitute part performance giving him entitlement to specific performance of the contract if he still desired

to purchase the land.  Understandably,

however, he has elected to pursue breach of contract damages as his remedy in

the present situation.

 

B. 

Breach of Contract

 

[6] When a party to a

contract breaches the contract, the other party may be entitled to the

equitable remedy of rescission.  See

Davis v. Cordell, 115 S.E.2d 649, 654 (S.C. 1950).  “Breach of a contract, to justify rescission,

must be so substantial and fundamental as to defeat the purpose of the

contract.” Id. at 654.

 

[7-8] In this case, the

parties did not agree on a specific time for Pagofie to survey the land, and in

such cases, a reasonable time will be implied. Id.  Clearly, Pagofie

breached the agreement when he failed over a two-month period, a more than

reasonable time, to produce a written contract to fully document the terms of

the land purchase agreement and to provide a survey of the quarter acre of land

involved, as Moana reasonably requested and expected.  In fact, it was conceivable from Pagofie’s

delay, together with his attempt to coerce an additional $5,000 from Moana,

that Pagofie did not intend to carry out his end of the bargain.  Pagofie’s breach was substantial enough to

defeat the purpose of the contract entitling Moana at that point to rescind the

contract and recover his damages. 

Moana’s compensatory damages are $5,900, the amount of the downpayment

plus the amount of the first installment and survey cost payment.

[9] Fraud is suggested by

Pagofie’s foot-dragging and improper attempt to increase the purchase price

after the agreement was formulated. 

However, we are not persuaded that Pagofie harbored actual intent to

defraud when the contract was entered. 

He was, at least, eager to take advantage of an opportunity to have in

hand a substantial sum of money, even though he was not prepared to perform his

side of the bargain in any reasonably expeditious manner.  It appears that later on he thought that

Moana had access to and could be readily manipulated to pay additional

funds.  His misconduct in handling this

transaction was deliberate and certainly reprehensible, and warrants assessment

of $1,500 as exemplary damages.

 

Order

 

Pagofie shall

pay Moana $5,900 in compensatory damages for Pagofie’s breach of the land

purchase contract between Pagofie and Moana and $1,500 as exemplary damages, a

total of $7,400, plus Moana’s costs incurred in this action.  The total amount of the judgment, including

costs, shall bear interest at the rate of 6% per annum until the judgment is

paid in full.

 

It is so ordered.