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Documentary evidence must be produced

By June 2, 2017November 30th, 2023No Comments

It is not sufficient for a witness to simply testify on a document if it is not produced in court. This was held by the First Hall of the Civil Courts in Farsons Beverage Imports Company Limited -v- Marco Aquilina, Cocktails Limited and Carisma Limited, by Mr Justice Lawrence Mintoff on 22 May, 2017. 

The plaintiff company explained in its application to the court that it had sold to the defendants beverages products, which was paid only in part, leaving a balance of €42,038.95. Farsons asked the court to order the defendants to pay this sum.

The defendants filed a statement of defence, wherein Marco Aquilina held that he had no commercial or judicial relationship with Farsons and that the plaintiff’s claims should not have been filed and that they were time barred.

Mr Justice Mintoff in his judgment listed the facts of the case. From the evidence produced over €38,000 was due to Farsons after the company had supplied beverages to two restaurants run by Cocktails Limited and Marco Aquilina since he had signed the credit application form and was personally liable. Furthermore €7,201.60 was owed to Anthony Caruana Sons Limited before it was amalgamated with Wands Limited, which was later further amalgamated with Farsons.

€22,232.62 was supplied by Guido Vella Limited, which passed through the identical process of amalgamations with Wands and then Farsons. A bill of €3,367.79 was owed by Carisma Limited for the same two restaurants, at the time it was running them. According to Farsons, Marco Aquilina had guaranteed this amount.

One of the witnesses was the Credit Control Manageress of Farsons who explained this to the Court and continued to explain she held a number of meetings with the defendants on a payment plan. There were some payments, but these stopped in August 2011. Further meetings took place in 2015, where payment was promised, but all that was paid was €500.

All the statements were produced in court, with exception of statements issued by Guido Vella Limited. Further evidence produced was documentation to show that Anthony Caruana & Sons Limited and Guido Vella Limited were amalgamated with Wands and therefore they were both struck off the company’s registry. It was explained that according to Article 354 of the Companies Act, there was no obligation on Farsons’s part to inform the debtors by means of the judicial letter that the debt is now owed to Farsons.

Marco Aquilina had testified that he and his brother acquired 50% of Carisma Limited, which ran a restaurant at the Valletta Waterfront, then they acquired 50% of Cocktails Limited which ran another restaurant. Both are now closed. He denied that he agreed with Farsons that he would be paying the company’s debts personally, but they had to be paid by the companies. 

The Court held that according to Article 562 of the Code of Organisation and Civil Procedure, it is the plaintiff who must prove that the debt is owed, however, if the defendant raises any defences then it would have to prove them. 

As regards to whether Marco Aquilina had a juridical relationship with the plaintiff company, the Court quoted a previous judgment Frankie Refalo -v- Jason Azzopardi decided on 5 October, 2005 by the Court of Appeal, which held that the Court would investigate whether the party claiming that he/she has no juridical relationship, was involved in the business dealing with the plaintiff.

The fact that it has been established that there existed a relationship between the two, means the defendant was responsible for the debt. From the evidence collected, Farsons argued that it sued Aquilina because he signed the credit application form, making him personally responsible for the companies’ debt. This could have been the case, however, Farsons failed to produce the document with Aquilina’s signature. The Court held that it is not sufficient that a witness testifies about this document, but it has to be produced for the Court’s verification. The Court declared it would be upholding Aquilina’s plea that he was not personally responsible for payment.

The Court then delved into whether the action should not have been filed, since Farsons should have filed a judicial letter against them notifying that Anthony Caruana & Sons Limited and Guido Vella Limited were now amalgamated into Farsons. According to Article 1471 of the Civil Code:

“The assignee may not, in regard to third parties, exercise Notice to debtor the rights assigned to him except after due notice of the assignment has been given to the debtor, by means of a judicial act, by the assignee himself or by the assignor.”

However, Farsons quoted Article 354(1)(a) of the Companies Act, which reads:

“(1) An amalgamation shall have the following consequences:

(a) the acquiring company shall succeed to all the assets, rights, liabilities and obligations of the companies being acquired, both as between the companies being acquired and the acquiring company and as regards third parties, without the requirement of any formalities other than those arising under this Title;”

Mr Justice Mintoff explained that since the Companies Act is specialised law, wherein it regulated amalgamations of companies, which is not found in the Civil Code, the Companies Act prevails and should be applied. 

The Court then moved to uphold the plaintiff company’s claims and ordered payment.

Dr Malcolm Mifsud


Mifsud & Mifsud Advocates

This article may also be accessed on Malta Today.