Re-discussing an agreement does not terminate that agreement

If one party to agreement wants to re-discuss any terms, the agreement is still valid at law. This was decided by the Court of Appeal presided by Mr Justice Lawrence Mintoff on 2 September 2020 in Nazzareno Fenech -v- Sammy Ellul ezercitanti l-kummerc bhala Ellul Classic Design Woodworks Limited.

Fenech filed the appeal following a decision delivered by the Consumers Tribunal on 3 December 2019. The Tribunal turned down his claim against Ellul, which dealt with the installation of new doors. Fenech was seeking a reduction in the price.

In this case Fenech had paid a deposit when he ordered 3 doors from Ellul. The delivery was between April and May 2019, but they were ready in June 2019. Fenech wanted to pay for the doors by monthly instalments, but Ellul refused because this was not the agreement and should have been paid on installation. Fenech then instituted the action and claimed €2530, which was the price of the 3 doors. Ellul replied that the doors were ready and Fenech should pay for them.

The Tribunal held that the issue turned into an unreasonable battle between the parties. If the doors were ready, they should be installed and Fenech should pay for them, although Ellul had some blame and should pay some damages.

Fenech appealed this decision and argued that the agreement was in fact null and void, since he never saw the doors ready. The Tribunal did not give any remedy if the doors are not fixed and if they were ready, they should have been deposited in court.

The Court of Appeal dealt with the first and third ground of appeal together since they dealt with whether the agreement between the two parties was valid at law. Fenech argued that he had lost all trust in Ellul and did not see the finished product and Ellul should have deposited these doors in court. The former felt that the agreement had fallen through.

Ellul countered by stating that there was no precise date for delivery, but there was merely an indication. In fact, in May 2019, Fenech was still choosing the colour of the doors. Ellul accused Fenech of not having the finances to pay for the doors as the true reason of the refusal.

The Tribunal did not declare that the agreement was terminated at any point and this was done after it had examined all the evidence brought before it. The Court of Appeal held that Fenech is asking for a re-evaluation of the evidence, something that a Court of Appeal should not do. A Court of Appeal should examine whether the first court, in this case the Consumers’ Tribunal, could reach the decision it took. The Court of Appeal did exactly this and saw that the agreement between the Parties did not establish a precise date when the doors had to be delivered. In July 2019. Fenech received a message saying that the doors were ready and asked for the balance. The Court point out that both Parties had signed an invoice and therefore, one could conclude that this was their agreement. The Court pointed out that this invoice indicated April/May and the colour was not indicated.

Ellul had finished the doors in June and even in July Fenech did not indicate that he wanted to terminate but negotiated on the terms of payment. Therefore, the agreement was still valid.

As to the second ground of appeal, where the Tribunal did not give an effective remedy if the doors are not installed and did not give a time limit. Ellul explained that the doors are still ready to be fixed as long as he is paid the balance. The Court of Appeal quoted from Subsidiary Legislation 378.01 on the Regulations of the Consumers’ Tribunal which states that the Arbiter may correct an error or omission in the decision and can award costs and interest. In this case, Fenech had a remedy before initiating these proceedings and therefore, did not need a solution for a hypothetical situation if Ellul failed to install the doors.

The Court of Appeal then moved to dismiss the appeal.