Power Holding Company Of Nigeria (Phcn) PLC & Anor V. Atlas Projects Limited (2016)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

SAIDU TANKO HUSAINI, J.C.A. (Delivering the Leading Judgment)

The case on appeal was commenced at the Federal High Court, holden at Yola vide the Writ of Summons issued on the 20th May, 2011. In the Statement of Claim filed same date the Plaintiff, now Respondent averred that a contract for the supply of safety equipment was awarded. The equipment consist of:

(1) 100 pairs of safety boots

(2) 200 pieces of safety belts

(3) 100 pairs of hand gloves

(4) 100 pieces of helmets

(5) 150 pairs of rain boots

(6) 150 pairs of rain coats; and

(7) 13 pieces of grounding leads.

The contract value was N8, 865,000.00 (Eight Million, Eight Hundred and Sixty-five thousand Naira) only inclusive of 5% VAT and Transport. All these are contained in the contract document Ref. No. PHCN/33/2D.030/VOL.1/446/2008 dated 30th September, 2008 and signed by parties on both sides. Part of the Agreement provided that for 15% down payment of the contract sum to be paid to the Respondent as mobilization fee while the remaining balance was to be paid after certifying delivery of the materials. The Appellants by a letter dated 5th

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December, 2008 modified some terms of the contract and requested from the Respondent, a bank insurance bond as condition for the release of mobilization fees. The respondent secured the advanced payment bond from Niger Insurance Plc at the cost of N500, 000.00 (Five Hundred thousand Naira) only and thereafter more other commitments with the Manufacturers/suppliers of the items enumerated in the contract document.

The Respondent could not hear from the Appellants about the mobilization fees and wrote through its Solicitors, served letters to the Appellants warning them of their imminent breach of the contract and demanded for specific performance of the contract. The Appellants on receiving solicitors letters invited the representatives of the Respondent and its Solicitors for a meeting and offered to the Respondent, the sum of N250, 000.00 (Two Hundred and Fifty Thousand Naira) only as compensation for its looses but respondent rejected the offer of compensation in view of the various financial commitments the Respondent had incurred in respect of the contract and insisted that the Appellants should perform their part of the contract. When there was no

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