Eastern Star K Trading Ltd. v. Halifax Chrysler Dodge (1989) Ltd.

Eastern Star K Trading Ltd. v. Halifax Chrysler Dodge (1989) Ltd. Court Supreme Court Date 2001-07-09 Citation 2001 NSSC 96 Docket SH 150442C Judge/Registrar/Adjudicator Davison, John M. (Honourable Justice) (SC) Document Type Decision Relations Library Sheet - Eastern Star K Trading Ltd. v. Halifax Chrysler Dodge (1989) Ltd. - 2001 NSSC 96 - 2001-07-09 - Library Sheet Decision Content Date: 20010709 Docket: S.H. 150442C IN THE SUPREME COURT OF NOVA SCOTIA [Cite as Eastern Star K Trading Ltd. v. Halifax Chrysler Dodge (1989) Ltd., 2001 NSSC 96 ] Between: EASTERN STAR K TRADING LIMITED, a body corporate under the laws of Nova Scotia Plaintiff - and - HALIFAX CHRYSLER DODGE (1989) LIMITED, a body corporate under the laws of Nova Scotia with offices in Halifax Defendant D E C I S I O N HEARD BEFORE: The Honourable Justice John M. Davison PLACE HEARD: Halifax, Nova Scotia DATE HEARD: June 25, 2001 DECISION: July 9, 2001 WRITTEN RELEASE: July 9, 2001 COUNSEL: Kenneth J. Winch for the Plaintiff William L. MacInnes, Q.C. for the Defendant Davison, J.: [1] Nikolai A. Kuprianow was the majority shareholder of the plaintiff. He is a person who came to Canada in 1997. There is no evidence of the birth place of Mr. Kuprianow but he spoke Russian. He did not testify at trial but counsel for the defendant filed the complete transcript of his evidence given during an examination for discovery. [2] The main witness for the plaintiff was Mr. Leonard Chepel who was a friend of Mr. Kuprianow and wanted to assist him in his introduction to Canada. His mother tongue was Ukranian and he can speak Russian and English. He testified that Mr. Kuprianow asked him to find a nice reliable car for his business. [3] No issue is raised about the interest of the plaintiff in the motor vehicle despite the comment in the evidence of Mr. Kuprianow on discovery that the “car he is buying now is only privately for his use and his family.” I am prepared to find the more credible evidence is the car was purchased on behalf of the plaintiff. That is the viva voce evidence of Mr. Chepel and the plaintiff was designated in the documentation as the purchaser or prospective purchaser of the vehicle and that documentation was prepared by employees of the defendant. [4] For the most part, the factual picture is advanced by the viva voce evidence of Mr. Chepel for the plaintiff and the defendant’s sales manager, Dean Melendy. The discussions between the parties were initially between Mr. Chepel and Mr. Sean Nixon, a sales person employed by the defendant. Subsequently Mr. Melendy and Mr. Kuprianow became involved. Neither Mr. Kuprianow nor Mr. Nixon testified at trial. There must also be considered the evidence of Mr. Kuprianow given at an examination for discovery and the evidence at trial of Mr. Gaetz Hienrich Otto Hintze who was called to the stand by counsel for the plaintiff. [5] Mr. Chepel first attended at the premises of the defendant in May 1998 to see the vehicles which were available for sale. He was impressed by a Dodge Durango and he sent pamphlets depicting that vehicle to Mr. Kuprianow. [6] The next contact with the employees of the defendant involved a meeting between Mr. Chepel and Mr. Nixon when a document referred to as a sales work sheet order was prepared by the defendant and signed by Mr. Chepel “for N.Kuprianow”. This document is in evidence as tab 1 of exhibit 1. Mr. Melendy stated these forms are used in negotiations with customers. The document was not signed by a representative of the defendant. To the left of Mr. Chepel’s signature there are the words “customer signature” and to the left of those words Mr. Chepel placed a mark in this form ( / ). There was a suggestion in counsel’s submission the mark had meaning or a purpose, but there is nothing in the evidence to support that statement. [7] The document is dated June 11, 1998 and refers to the vehicle as a 1998 Dodge Durango with a selling price of $42,524 and an additional $1000 for leather interior. Yet at the bottom of the document there appears a different figure - “$42,000 + tax”. Mr. Chepel refers to this document as a “suggestion for Kuprianow” to whom he sent a copy of the document. It is the position of the plaintiff that Mr. Chepel had no authority to purchase a motor vehicle from the defendant but was to assist Mr. Kuprianow in securing a vehicle and there would be no purchase of a vehicle until Mr. Kuprianow approved of the vehicle. [8] Mr. Chepel was, in my view, a reliable witness. I accept his evidence as I found his evidence to be truthful and consistent with the other facts and circumstances in this proceeding. I find the only authority he had from the plaintiff or from Mr. Kuprianow was to assist his friend in securing a suitable vehicle in the absence of Mr. Kuprianow, but the purchase was subject to the approval of Mr. Kuprianow. That is the evidence of Mr. Chepel and the evidence given by Mr. Kuprianow in the examination for discovery who testified: 14. Q. What authority does Mr. Chepel have to enter into contracts for Mr. Kuprianow or Eastern Star K Trading Limited? A. (NN) Absolutely no. 15. Q. He has no authority to enter into anything? A. (NN) No authority, no. This is his answer. . . . 18. Q. Does Mr. Chepel have any relationship to that company, either as an employee, shareholder or director? A. (NN) No, he’s not in any way related to Eastern Star. [9] I find the parties did not enter a contract to purchase a particular car. Their negotiations reached the stage where there was concentration on Dodge Durangos, but there was no agreement by the plaintiff through Mr. Chepel or Mr. Kuprianow to purchase a particular vehicle. [10] Tab 1 of exhibit 1 was referred to by the sales manager as a “sales work sheet order that sales persons used in negotiation with the customer.” A document was submitted to the court, filed as exhibit number 3, entitled “Retail Buyers Vehicle Order and Agreement”. It is for stock number 34230. It is dated June 30, 1998. The purchaser is said to be Mr. Kuprianow but no person signed on behalf of him. It is signed by a representative of the defendant. It is clear this is the type of document used by the defendant as an agreement to purchase a specified vehicle for a certain stipulated price. It is the agreement of sale. [11] The worksheet order which is tab 1 of exhibit 1, which was signed by Mr. Chepel for Mr. Kuprianow is not an agreement. It was not signed by the defendant. It is vague. There are two prices set out and it appears to be a document sales persons use to set out the additions and requirements with respect to a vehicle. The document is a photostat and makes reference to a 1998 Dodge Durango, but the exhibit has been copied in a manner where the stock number is not revealed. If there were terms and conditions on the back of this form, Mr. Chepel signed a copy to which there was no copy of terms and conditions. [12] Mr. Chepel sent that work order to Mr. Kuprianow but did not send to him the work order at tab 2 of exhibit 1. In fact Mr. Chepel stated he did not receive that document and he described it as a “changed document” and a “falsified document.” [13] Observation of these two documents clearly indicates that the document at tab 2 is a photocopy of the document at tab 1 with certain handwritten additions. The stock number and the “exact delivery date and time” may have been eliminated because of the manner of photocopying. But clearly there has been added to the tab 2 document “1434KMS", “16%” and “+ finance fee $48,720" which sum is $42,000 plus 16% of $42,000. This is inconsistent with the other sums on the document - “$42,524.00" and “$1000 leather inte” [14] The other addition to the document at tab 2 is the signature of Dean Melendy on behalf of the defendants. In other words the defendant did not sign the document filed as tab 1. The plaintiff and Mr. Chepel did not sign the document filed as tab 2. The handwritten information on tab 2, including reference to the number of kilometres on the vehicle, was added by the defendant’s sales manager after Mr. Chepel signed the document in tab 1which is the only document he signed. There was no meeting of minds. There was no document signed by both parties with respect to the purchase of a car. [15] The third document in tab 3 of exhibit 1 was described by Mr. Melendy as a “computer generated sheet that details the standard and mostly optional equipment on the vehicle generated by inputting the vehicle stock number into the system”. This exhibit has the handwritten notes of Mr. Chepel in the Russian language detailing discussions had with Mr. Nixon. This was sent to Mr. Kuprianow along with the document in tab 1 and is further indication that it was only Mr. Kuprianow who could reach an agreement on the purchase of a motor vehicle. [16] The transcript of evidence on discovery revealed that Mr. Kuprianow believed he was purchasing a new car, which was a Dodge Durango with the addition of leather seats and a silver color. He was told that to get such a car he would have to deposit $10,000, a procedure unfamiliar to him. [17] He was advised by Mr. Chepel that the color he wanted was not available, but there was another dealer which had the proper color but not the leather seats. Mr. Chepel said the defendant would change the interior to leather, but the car would have to be driven 200 to 300 kilometres. Mr. Kuprianow directed Mr. Chepel to refuse that car and he would attend to choose a car on the defendant’s lot. He said Mr. Chepel thought it was a “planned falsification” to sell a vehicle which had travelled 2500 kilometres. It is clear from the transcript that Mr. Kuprianow wanted a new car and not one which had travelled 2500 kilometres. It is also clear the defendant knew this when they referred to a vehicle in New Brunswick, and indicated there would be kilometres on the odometer by reason of the trip. Mr. Chepel only expected a registration of 300 or 400 kilometres and objected later to a vehicle with 2,500 kilometres as not being a “new” vehicle. [18] The sales manager, Mr. Melendy, stated he added to the document filed as tab 2 and signed it. He said that a $10,000 deposit was requested “in order for us to commence altering the vehicle”. This would establish the sum requested was not a deposit on a particular contract or to ensure the contract was completed but was requested to compensate for the cost of alteration. Yet there was no evidence the money was spent for that purpose. Indeed the day after the deposit was made by Mr. Kuprianow it was discovered the color of the interior was not compatible with the other colors of the vehicle. [19] At that point the defendant found a vehicle in Sydney or North Sydney which could be adapted for the desired leather interior. Mr. Melendy said he told Mr. Nixon to advise Mr. Chepel there were 200 kilometres on the vehicle, and by the time it would reach Halifax there would be 2500 kilometres on it. Mr. Chepel denied receiving this information, but as stated he did expect 300 or 400 kilometres would be on the vehicle which came from New Brunswick. It is clear from the evidence of Mr. Chepel and Mr. Kuprianow, and I find that they wanted a new car and not one with 2500 kilometres on it. [20] Mr. Melendy describes observing, on June 26, 1998, a fax from Mr. Chepel to Mr. Shane who was not in the office. The fax stated Mr. Kuprianow would like to exercise the right to choose vehicles when he comes to the office which “reconfirms with our previous discussions in your office”. Mr. Melendy said he phoned Mr. Chepel and said that was not part of the deal that Mr. Kuprianow had a choice of vehicles because the defendant incurred expenses. But Mr. Melendy was not involved in the initial instructions with Mr. Chepel who said he told Mr. Nixon he was not the buyer and that Mr. Kuprianow has the right to inspect the vehicle before he buys. Mr. Chepel said Mr. Nixon said that was acceptable. [21] In my view the evidence falls short of proving the defendant spent any money in the alteration of the vehicle. Mr. Melendy said the changes “if it weren’t complete, it was, at least in the process.” But there was evidence the problem with changing the interior and the color scheme was noted to be incompatible, and this would indicate the work was not undertaken, at least at that time. On one of the sheets the estimate of the change to leather was $1,000. I find the defendant has not proved any expenses were incurred in effecting the change in a vehicle. [22] Mr. Melendy said Mr. Kuprianow came to the showroom on July 18, 1998 and complained there was not a “wheel package” or flares. He said Mr. Kuprianow exploded in the middle of the showroom and left the premises. [23] A different version of the meeting in the showroom was given by Gaetz Hienrich Otto Hintze, who was a friend of Mr. Kuprianow. He said the dispute arose when Mr. Kuprianow advised he was buying a new vehicle and the vehicle he was shown was not new. Mr. Hintze said the employee of the defendant said that is what Mr. Kuprianow ordered, and that was the car he had to take. The sales manager entered and said if the car is not taken, the defendant will keep the deposit. [24] On the whole of the evidence, I find Mr. Chepel’s role was to assist Mr. Kuprianow in locating a suitable car. He had no authority to bind the plaintiff to buy a particular car. The agreement effected between the parties was that Mr Kuprianow had the choice of which car the plaintiff would purchase. Mr. Sean Nixon agreed to that stipulation. [25] I also find Mr. Kuprianow wanted a new car. He was not told the vehicle had 2500 kilometres on it’s odometer. The defendant rendered the reaching of an agreement impossible when they insisted Mr. Kuprianow purchase a vehicle which was not his choice and which could not be considered “new” or lose his deposit. [26] I find there was no agreement to buy a particular car. The $10,000 was to secure changes in the vehicle, but there was no evidence of what costs, if any, were incurred. The defendant placed an ultimatum on Mr. Kuprianow to buy a particular car and wrongfully retained the deposit. [27] The plaintiff’s action shall succeed and the defendant shall pay the plaintiff $10,000 together with pre-judgment interest from the date it was received by the defendant to the date of the order for judgment. There was no reference to the rate of interest and counsel may reach an agreement on this issue or submit written comments to the court. [28] The defendant will pay costs to the plaintiff of $1,400 plus reasonable disbursements. J.