Luxemburg v Goldfinger et Al

• Jurisdiction: Anguilla
• Judge: Saunders, J
• Judgment Date: 29 May 2000
• Neutral Citation: AI 2000 HC 6
• Docket Number: Civil Suit No. 106 OF 1998
• Court: High Court (Saint Christopher, Nevis And Anguilla)
• Date: 29 May 2000

High Court

Saunders, J.

Civil Suit No. 106 OF 1998

Luxemburg

and

Goldfinger et al

Appearances:

Mr. Justin Simon with Ms. Lisa Bass for the plaintiff

Ms. Myrna Walwyn for the defendants

Contract - Commission for sale of property — Plaintiff not entitled to commission because he was not the valid holder of a work permit and therefore agreement was tainted with illegality and was unenforceable — Finding that the plaintiff was entitled to be paid the commission.

Saunders, J

1 The plaintiff in these proceedings is suing to recover the sum of US$100,000.00. He has two distinct claims. The first lies in contract. He says that the defendants owe him US$75,000.00 representing the agreed commission of 5% on the sale of a Villa (“Villa 6”) the purchase price of which was US$1.5 million. His other claim is on a quantum meruit. The plaintiff says that he supervised a project (the construction of “Villa 5”) for the defendants but they failed to pay him. The plaintiff places a value of US$25,000.00 on his supervisory efforts. He says that the defendants had actually promised to pay him that sum.

2 Several defences have been pleaded. The defendants allege that, contrary to Anguilla law, the plaintiff was not the holder of a valid work permit. It is also argued that the plaintiff was not entitled to engage in the occupation of either a real estate agent or that of a building contractor, project manager or supervisor. It is said that his agreements with the defendants are tainted with illegality and are therefore unenforceable.

3 Should the court reject those legal submissions, the defendants argue that, in relation to the contract for a commission, the 5% should be calculated not on the sum of US$1.5 million paid by the Purchaser but only on US$1 million. They state that the agreement between the parties excluded commission on architectural and other professional fees and that, of the US$1.5 million paid, US$500,000.00 represented such fees. If any commission is payable, they say, the same should be US$50,000.00 and not US$75,000.00.

4 Regarding the claim for supervisory fees, the defendants deny that the plaintiff was ever promised any such fees. Further, it is said that whatever the plaintiff did was negligible or unsolicited. The defendants say that in any event, the responsibilities the plaintiff undertook in connection with the construction of Villa 5 formed part and parcel of his normal every day duties for which he has already been handsomely paid.

The factual background

5 Norman Luxemburg is the plaintiff. He came to Anguilla from the United States in 1990 and was later employed by Cove Castles Limited (C.C.L.) as its resident Manager. From what I have seen, he was a careful, thorough and hard working Manager.

6 Myron Goldfinger is an architect of international repute. His wife is an interior designer. Some years ago, the Goldfingers conceived the idea of building a resort in Anguilla. The couple's dreams have since been realized. The luxury resort is known as Cove Castles Villa Resort. It comprises several posh villas, a tennis court, a laundry and a number of other structures.

7 The resort embodies the operations of two legal entities. A Delaware corporation, Cove Castles Development Corporation Limited (C.C.D.C), has title to beach front lands in Anguilla. The corporation developed these lands by building on them private villas for sale to wealthy individuals. A prospective purchaser would enter into an agreement to purchase a villa before the villa was actually constructed. The purchaser would see the site and all the architectural and interior plans. He or she would then pay for the finished and furnished villa over the period of time while construction thereof was in progress. The villas are arranged in condominium style units. The owners are able to reside in their units for up to four weeks in any given year. For the rest of the time the villas are marketed and made available for rent to the general public as a resort complex. The role of C.C.D.C. was therefore to develop and sell the villas.

8 Cove Castles Limited (C.C.L.), with whom Mr. Luxemburg was actually employed, is an Anguillian company. C.C.L. manages the resort complex. The resort staff are all employed with C.C.L. That company has shares in C.C.D.C. The same individuals who own C.C.D.C. also own shares in C.C.L. The Goldfingers are the key players in each company. At all material times, Mr. Goldfinger was the Managing Director of both C.C.L. and C.C.D.C.

9 It is not disputed that when Mr. Luxemburg and Mr. Goldfinger discussed the former's employment contract with C.C.L., Mr. Goldfinger promised his Manager that the latter would have the opportunity of supplementing his income by earning 5% commission on the sale of any villas that he was able to negotiate. This made perfect sense. C.C.D.C. wanted to sell its villas. In the course of performing his functions it was very likely that Mr. Luxemburg would come into contact with affluent persons who might be interested not merely in renting a villa but in acquiring title to one. This was a means of encouraging the resort's manager to promote sales of the villas. As I have stated before, C.C.L. was a shareholder in C.C.D.C. It follows therefore that C.C.L. stood to benefit materially from the financial successes of C.C.D.C. The previous C.C.L. manager, Mr. Andre deLucinges was also given the same opportunity to supplement his income.

10 At the trial a great deal of evidence was tendered regarding the precise nature of the agreement for commission on the sale of villas. I do not find it necessary to make any analysis of that evidence. Suffice it to say that in his testimony, Mr. Goldfinger emphatically affirmed that he had agreed to pay Mr. Luxemburg a commission of 5% on the “land, building and contents.” In due course, if it becomes necessary so to do, the court must construe that agreement.

The claim for supervisory fees re Villa 5

11 The factual circumstances surrounding this claim are more contentious than the other claim. It appears that when Villa 5 was being constructed none of the directors of C.C.D.C. was continuously resident on the island. The builder, Mr. Audley Carty, had no office in Anguilla. Mr. Goldfinger was unable to contact him directly by telephone or by fax.

12 After perusing the testimony and examining the voluminous correspondence between Mr. Goldfinger and Mr. Luxemburg, I am satisfied that Mr. Goldfinger relied on his resort Manager to act as a liaison with the builder. I believe that Mr. Luxemburg did oversee the progress of the construction of Villa 5. I also accept that he did source some supplies, track shipments, clear them through customs, and pay suppliers all on behalf of CCDC.

13 The two germane issues are whether all of this fell within the scope of his employment as resort Manager and whether there was any promise by Mr. Goldfinger to pay for the performing of these tasks. On the latter issue, Mr. Luxemburg's evidence is that about the first week of June, 1996 Mr. Goldfinger had told him to the effect that he would be well taken care of or that CCDC would compensate him for his supervisory work on Villa 5.

14 In the course of trying this case it became obvious to me that Mr. Luxemburg is a man who loves to write, to document important things, to formally set out and clarify matters especially those affecting his interests. It is therefore remarkable that at no time prior to the institution of these proceedings did he confront Mr. Goldfinger with any written demand for compensation for supervisory work on Villa 5. To be fair to Mr. Luxemburg, he did give an explanation for not so doing. I understood him to say that he felt that to have raised the issue might have prejudiced his negotiations with Mr. Goldfinger regarding his efforts to recover his 5% commission on the sale of Villa 6. That explanation does not impress me.

15 Mr. Luxemburg wrote a letter to three members of the Management Committee of the resort on 23 ^rd May 1997. In that letter he discussed the work he had been doing on Villa 5 for the defendants. He bitterly complained that this additional work placed a great burden on his time. He railed against “Mr. Goldfinger's insistence that I help him with all aspects of the construction”. After cataloguing the onerous responsibilities thrust upon him and his wife, he grumbled that “we received absolutely no compensation or gratuity of any kind from Mr. Goldfinger for this or any other efforts we made to help him get the house finished”. I believe that if such compensation had been promised to him he would have so stated. Instead he appealed to the Committee to put in place a number of mechanisms to relieve him of the extra load in the future.

16 The tone of that letter suggests to me the fervent pleas of someone who has not been promised any reward; someone who does not expect that he will receive any “compensation or gratuity of any kind”.

17 The evidence of Barrister at Law Ms. Joyce Kentish is of some significance. Before these...