Matter: Contract

Between: Mr. A  Plaintiff

Company Na Public Company Limited, Defendant No. 1

Company So Limited, Defendant No. 2

Mrs. Ch, Co-Defendant No. 1

Mr. Ph, Co-Defendant No. 2

 

The Plaintiff filed a lawsuit stating that Defendant No. 1 is the owner and developer of a housing project, with Defendant No. 2 acting as an agent. On October 8, 2016, the Plaintiff entered into a contract to reserve two houses in the housing project at the price of 21,029,580 Baht, paying a reservation fee of 50,000 Baht. Subsequently, on January 25, 2017, the Plaintiff entered into a payment installment agreement for 10% of the selling price, totaling 2,102,358 Baht, to be paid in 10 installments, each installment being 150,000 Baht, with the last installment being 605,358 Baht. The Plaintiff paid 10 installments totaling 1,500,000 Baht. On July 17, 2019, the Plaintiff made an agreement not to purchase the houses any longer. Defendant No. 1 agreed to refund the 1,500,000 Baht paid by the Plaintiff in 13 installments, the last installment due by August 31, 2020. After the due date, the Plaintiff received only 200,000 Baht. The Plaintiff notified Defendants No. 1 and No. 2 to pay the remaining debt of 1,300,000 Baht, but both Defendants ignored and denied liability, claiming it was the responsibility of the employee of Defendant No. 2. Such actions caused the Plaintiff, as a consumer, damage, with the intention to exploit the Plaintiff unfairly and to deliberately cause harm. Therefore, they are liable to jointly refund 1,300,000 Baht with interest at the rate of 7.5% per annum on the said principal from each default date until April 10, 2021, and at the rate of 5% per annum on the said principal from April 11, 2021 until the date of filing, calculated at 188,312.21 Baht, plus damages from breach of contract and litigation expenses of 150,000 Baht, and punitive damages of 300,000 Baht.

Defendant No. 1 submitted a defense that it is the project developer with Defendant No. 2 as its agent, without any conditions for installment payment of the contract fee. The making of settlement or additional agreements with the Plaintiff by employees of Defendant No. 2 was beyond their authority and not binding on Defendant No. 1. Defendant No. 1 never received any money or made any refund to the Plaintiff, and has no legal relationship with the Plaintiff. Defendant No. 1 is not liable to the Plaintiff and requests dismissal of the case.

Defendant No. 2 submitted a defense that it is an agent of Defendant No. 1 and never knew of the installment payment agreement or the agreement not to purchase the houses. Such agreements were made by former employees of Defendant No. 2 and personally bound them with the Plaintiff. Defendant No. 2 has no legal relationship with the Plaintiff and has no duty to refund. Defendant No. 2 requests dismissal of the case.

During the proceedings, the Court summoned Mrs. Ch and Mr. Ph, former employees of Defendant No. 2, as co-defendants. Both co-defendants defaulted in filing answers. The Court deemed the cause of action to be indivisible and postponed judgment or final order by default to continue proceedings against the defendants who submitted defenses, and to adjudicate accordingly for all defendants.

Issues to be decided: Whether the two co-defendants are liable to refund the Plaintiff, and to what extent. The two co-defendants admitted that they received 1,500,000 Baht from the Plaintiff, and refunded 200,000 Baht, and there was no further payment. After the lawsuit, the co-defendants jointly paid 420,000 Baht to the Plaintiff. The two co-defendants must share responsibility with the Plaintiff for the outstanding 1,300,000 Baht with interest as claimed, totaling 188,312.21 Baht, deducting the 420,000 Baht first from accrued interest, and the balance from the principal. For damages from breach of contract, the Plaintiff presents evidence to prove damages. Litigation expenses are set by the Court; therefore, damages under this item are not determined.

Next issue to be decided: Whether Defendant No. 2 must share responsibility with the two co-defendants. Defendant No. 2 admitted that the two co-defendants were its employees, and upon receiving contract payments from the Plaintiff, issued receipts to the Plaintiff, with the receipt head clearly stating the name of Defendant No. 2. Therefore, the business conducted by the two co-defendants as complain must be regarded as within the course of employment of Defendant No. 2. Defendant No. 2 must share responsibility with the two co-defendants under Section 425 of the Civil and Commercial Code.

Next issue to be decided: Whether Defendant No. 1 must share responsibility with Defendant No. 2. Defendant No. 1 admitted that Defendant No. 2 was its representative. Even though Defendant No. 2 had no authority to make such agreements or a settlement agreement, the Plaintiff could not know this, and the name of Defendant No. 1 appeared on the complaint documents filed by the Plaintiff.

The issuance of documents by Defendant No. 2’s employees reasonably led the Plaintiff to understand that the two co-defendants had authority. Defendant No. 1 cannot rely on such grounds as a defense against the Plaintiff in the event of damage. When the facts appear that Defendant No. 2’s employees, as agents of Defendant No. 1, committed dishonestly, Defendant No. 1 failed to exercise due care and cannot deny liability. As the two co-defendants committed a tort by taking money from the Plaintiff without refund, Defendant No. 2 must refund the money to the Plaintiff, and Defendant No. 1, as principal, must share responsibility with Defendant No. 2 for the result of such tort under Section 427 in conjunction with Section 425 of the Civil and Commercial Code.

Final issue to be decided: Whether punitive damages of 300,000 Baht should be determined. The two co-defendants acted beyond their authority by a tort of deceit. It is not the case that Defendant No. 1 and Defendant No. 2 intended to take advantage of or cause damage to the consumer. Therefore, Defendants No. 1 and No. 2 are not liable for punitive damages under Section 42 of the Consumer Case Procedure Act.

The Court orders Defendants No. 1 and No. 2, and the two co-defendants, to jointly pay 1,488,312.21 Baht with interest at 5% per annum or the rate adjusted by the Ministry of Finance by Royal Decree under Section 7 of the Civil and Commercial Code, plus an additional 2% per annum, but in total not exceeding 5% per annum, on the principal of 1,300,000 Baht from the day following the filing until full payment. The 420,000 Baht paid by the co-defendants after filing shall first be deducted from accrued interest, and the balance from the principal until completion. Court fees exempted for the Plaintiff shall be paid by Defendants No. 1 and No. 2, and the two co-defendants, to the Court in the name of the Plaintiff. Attorney’s fees are set at 20,000 Baht, specifically for trial representation, to be borne according to the portion of the claim won by the Plaintiff. Other litigation expenses are abated. Other claims are dismissed.