Sona Breweries Plc V. Sir Shina Peters & Anor (2004)
LawGlobal-Hub Lead Judgment Report
PIUS OLAYIWOLA ADEREMI, J.C.A.
The plaintiffs (hereinafter, referred to as the respondents and cross/appellants) who claimed to have been retained by the defendant (hereinafter, referred to as the appellant and cross/ respondent) to perform live throughout Nigeria on its (appellant) Maltonic National Musical Tour of ten Northern States, the terms of and conditions of which were stated in a letter dated 7th July, 1995; had sued the said appellant claiming special and general damages for breach of contract, loss of reputation and goodwill and loss of earnings. The break-down of which is as follows;
(a) Special Damages
The sum of N1,590.000.00 being the total loss of earning due to the plaintiffs from gate takings and money sprayed by guests (the particulars of which are contained in the pleadings).
(b) General Damages
(i) The sum of N50,000.00 being damages for the defendant’s unilateral and flagrant breach of the agreement reached concerning the musical tour of ten (10) Northern States scheduled for 17/8/95 to 27/8/95.
(ii) The sum of N50,000.00 being damages for the plaintiffs’ loss of reputation and goodwill occasioned by the defendant’s unilateral breach of the agreement aforesaid.
The defendant/appellant had also counter-claimed against the plaintiffs/respondents for:
(a) The sum of N250,000.00 (two hundred and fifty thousand naira), being the mobilization fee paid by the defendant to the plaintiff for the musical tour which the plaintiffs did not carry out.
(b) Interest on the said sum of N250.000.00 at the rate of 21% from the date of this suit until the date of judgment and thereafter, at the rate of 6% per annum until full satisfaction of the judgment debt.
(c) Costs of instituting this action.
Pleadings in terms of statement of claim and with the leave of court, an amended statement of defence and counter-claim were filed and exchanged between the parties. The case later proceeded to hearing with both sides leading evidence in support of their claim and counter-claim respectively. At the end of the proceedings, the learned trial judge of the Lagos High Court sitting in Lagos Judicial Division, in a considered judgment delivered on the 7th of May, 1999, found in favour of the plaintiffs/respondents and ordered that the defendants/appellants should pay them N870,000.00. The counter-claim of the defendant/appellant was however, dismissed.
Being dissatisfied with the said judgment, the defendant filed an appeal therefrom upon a notice of appeal dated 10th May, 1999 which carries three grounds of appeal. The plaintiffs who were also dissatisfied with that part of the judgment which disallowed their claim for general damages of N50 million also cross-appealed upon a notice which was later amended with the leave of court. The amended notice of cross-appeal carries two grounds. Distilled from the three grounds of appeal identified for determination as contained in the appellant’s brief of argument are two issues which are as follows:
(1) Whether the N250,000.00 (two hundred and fifty thousand naira only) paid to the respondents by the appellant was a mobilization fee or consideration due to the respondents for the proposed tours?.
(2) Whether the respondents were entitled to and strictly proved the special damages of N870,000.00 (eight hundred and seventy thousand naira only) awarded by the trial court?.
From the appellants’ notice of appeal, the respondent, although at page 2 of its brief said three issues were identified for determination, however, in truth only, two (2) issues have been identified and as set out on page 2, they are as follows:
(1) Whether or not the N250.000.00 paid to the respondents by the appellant was paid as mobilization fee only or as performance fee and consequently is the appellant entitled to a refund of the said sum as claimed by the appellant?.
(2) Was the evidence led by the respondents sufficient to establish the respondent’s claim for special damages of N870,000.00 being the respondents’ loss of earnings from gate takings as particularized in paragraph 10 of the statement of claim dated 13/3/96?.
As I have said supra, the plaintiff/respondent was also dissatisfied with part of the judgment, hence, a cross-appeal, the amended notice of which carries two grounds. Distilled therefrom for the determination of the cross-appeal are two issues. Set out in the cross appellant’s brief. They are in the following terms:
(1) Is the respondents’ claim for N50 million being general damages for their loss of reputation and goodwill tantamount to double compensation in the circumstances of this action?.
(2) Did the respondents (as plaintiff at the lower court) prove or establish their claim for N50 million being general damages for their loss of reputation and goodwill occasioned by the appellant’s unilateral cancellation and/or breach of the aforesaid agreement between the parties?.
In reacting to the issues raised by the cross-appellant for determination, the appellant who is now the respondent to the cross-appeal identified two issues for determination; they are as follows:
(1) Whether the cross-appellant’s claim for 50 million for loss of reputation and goodwill is tantamount to double compensation?.
(2) What is the measure/amount of general damages due to the cross appellants for loss of reputation and goodwill?
When this appeal came before us on the 4th of November 2003, Mr. Awosika, learned counsel for the appellant adopted his client’s brief of argument filed on 2/6/2000 and the reply brief filed on 23/5/2001 and urged that the appeal be allowed. Mr. Ajayi, learned counsel for the respondent and the cross-appellant adopted his client’s combined briefs filed on 1st February, 2001 and urged that the appeal be dismissed but that the cross-appeal be allowed. Mr. Awosika, thereafter, adopted the appellant/respondent’s brief to the cross-appeal which brief was filed on 23/5/2001 and urged that the cross-appeal be dismissed.
I have had a careful examination of issues formulated by the parties for the determination of the appeal. It is my view that issue No. 1 on the appellants’ brief is similar to issue No. 1 on the respondents’ brief. I shall, therefore, take the two together. Issue No.2 on the appellant’s brief which is identical with issue No.2 on the respondents’ brief shall also be taken together.
On issue No.1, the appellant had argued in its brief of argument that by the written agreement signed by both parties and which was tendered as exhibit A, the N250,000.00 paid by the appellant to the respondents was the consideration they (the respondents) were due under that agreement to perform at all shows throughout the country: Exhibit A, it was further argued, made no provision for further payments by the appellant. And since the respondents did not embark on the tours, the mobilization fee was not needed. The respondents however, in their brief, reviewed the testimonies of the witnesses called, particularly DW1 – Olufunso Ogundipe, the Advert Promotions Manager of the defendant/respondent/cross-appellant who in his evidence said that the facts pleaded in paragraph 7 of the amended statement of defence and counter-claim was correct. For a clear understanding of the arguments of the respondents’ paragraph 7 of the amended statement of defence, the averments of which were said to be correct reads:
“The defendant avers that the said tour was to commence on the 17th of August, 1995 and a Mobilization Fee of N250.000.00 was paid to the 2nd plaintiff/respondent which sum was duly receipted for on the 13th of July, 1995.”
It was their further argument that the appellant’s silence on the face of a letter dated 24/8/95 addressed by the respondent to the defendant in which they contended that the mobilization fee paid to them (defendants/respondents/cross-appellants) had been fully utilized to put their musical instrument, staff bus in readiness for the tour, is an admission of that contention; reliance was placed on the decision in Gwani v. Ebule (1990) 5 NWLR (Pt. 149) 201. The respondents further submitted that the appellant having failed to contradict their evidence in this respect, minimal proof of same is what is required of them (respondent’s) citing in support the decision in Balogun v. U.B.A. (1992) 6 NWLR (Pt. 247) 336.
The respondents pleaded frustration on the part of appellant which is evidenced by exhibit F. Even if the said sum was due to be refunded, since the payment was done by IBBI and not the appellant, and the receipt was taken out in the name of IBBI (International Beer and Beverages Ind. Nigeria Limited) it is that body that can, in law, demand for a refund, the case of Nigerian National Supply Company v. Sabana (1988) 2 NWLR (Pt. 74) 23 was cited in support.
The determination of this appeal rests squarely on the construction of the agreement signed by both sides. And before any contract or agreement can be said to come into existence, in law, there must be an unmistaken and precise offer and an unconditional acceptance of the terms mutually agreed upon by the parties thereto. In other words, the parties to the agreement must be in consensus ad idem as regards the terms and conditions freely and voluntarily agreed upon by them. Both sides to the contract must be clear as to what the more fundamental and crucial terms of the agreement connote before the agreement can be said to come into legal effect.
If the terms and conditions of the agreement are uncertain or vague as to defy ascertainment with reasonable degree of certainty, there can never be a valid agreement known to law which can be said to offer itself for enforceability. See (1) Pan African Bank Ltd. v. Ede (1998) 7 NWLR (Pt. 558) 422 and (2) Ezenwa v. Ekong & Or. (1999) 1 NWLR (Pt. 625) 55. Exhibit A is the agreement dated 7th July, 1995 agreed to by both sides. Paragraph ‘b’ thereof, which is the part relevant to the sum paid reads:
“We shall pay a sum of N250,000.00 (two hundred and fifty thousand naira) for the 10 (ten) shows.”
Paragraphs 4 and 5(a) & (b) which are relevant to the issue under consideration. The payment of N250,000.00 read:
Para. 4
“Sometimes in July, 1995, the defendant retained the services of the plaintiffs for the 1st plaintiff and his band to perform live throughout the entire Maltonic national musical tour (Phase III) of ten (10) Northern States organized by the defendant.
Para 5 (a)
The plaintiffs averred that it was agreed between the parties that the 1st plaintiff will perform in Kaduna, Zaria, Jos, Kafanchan, Keffi, Suleja, Bida, Minna, Kogangora and Mokwa on terms mutually agreed upon and which were clearly spelt out in the defendant’s letter dated 7/7/95.
Para 5(b)
At the trial hereof, the plaintiffs will rely on the defendant’s letter dated 7/7/95…”
The defendant/appellant in reacting to paragraphs 4 and 5 of the statement of claim averred in paragraph 4 of its amended statement of defence and counter-claim thus:
“With reference to paragraphs 4 and 5 of the statement of claim the defendant avers:
(a) that it acted as a disclosed agent on behalf of International Beer and Beverages Industries Nigeria Limited (IBBL) to arrange the contract referred to in paragraphs 4 and 5 of the statement of claim.
(b) The defendant denies that IBBL is its subsidiary.
(c) That the contract was with the 2nd plaintiff and not with the 1st plaintiff either alone or jointly with the 2nd plaintiff.”
From the averments contained in the pleadings of both sides, it seems clear to me that both of them held out exhibit A as the binding agreement between them. A court of law must always respect the sanctity of the agreements reached by parties as it favours the inalienable rights of the freedom of formation of contracts by parties and would not make a contract for them or re-write the one they have already made for themselves- see: Owoniboys Technical Services Ltd. v. Union Bank of Nig. Ltd. (2003) 15 NWLR (Pt. 844) 545. Exhibit A paragraph (b) thereof quoted supra leaves me in no doubt that the sum of N250,000.00 paid by the defendant/respondent/cross-appellant was, by their mutual agreement, to cover the fee for the ten shows. By no strained interpretation or construction can it be said that the sum tantamounted to mobilisation fee. Indeed, the words ‘mobilisation fee’ are extraneous to the said agreement dated 7th July, 1998 and tendered as exhibit A.
Whether the defendant/appellant would be entitled to a refund of the said sum would depend on whether the contract was breached or not. By exhibit A, the tour was to start on the 17th of August, 1995. The plaintiffs/respondents said they had completed argument to proceed on the 17th of August, 1995. However, by exhibit H – a letter dated 16th August, 1995 addressed on behalf of the defendant/appellant by its Marketing Manager- Bisi Adeniyi, the plaintiff/respondent was requested to postpone the tour. The salient portions of exhibit ‘E’ read:
“We regret to inform you that due to circumstances beyond our control, the tour cannot start as planned, we therefore request your organization to shift the commencement date for three (3) weeks. While appreciating your past contribution in the promotion of our products, we regret any inconveniences this shift might cause your other engagement.”
By this letter, exhibit E, the commencement of the tour was put on a hold. The plaintiffs/respondents expressed their dissatisfaction with the contents of exhibit E by their two letters exhibits ‘F’ and ‘G’, dated 24th August, 1995 and 15th November, 1995 tendered as exhibits ‘F’ and ‘G’ respectively. There is nothing on record to show that both sides met before exhibit E was unilaterally issued out by the defendant/appellant. Upon the payment of the sum of money to the plaintiffs/respondents by the defendant/appellant, the embarkation on the tour by the plaintiffs/respondents is something which underlies the whole contract such that if it is not complied with, the non-performance of it then becomes totally different from that which the contract contemplates.
That is a breach of fundamental term resulting in performance so totally different that it can be rightly said that there could not be in effect, any performance at all of the actual obligation agreed under the contract, who then is to blame? I do not hesitate in proffering an answer that it is the defendant/appellant to blame. As no one is allowed in law to take advantage of his own wrong doing, I say of issue No.1 on the appellant’s brief that the sum of money paid by the defendant/appellant to the plaintiffs/respondents is the money properly due to the latter for the tours unilaterally aborted by the appellant. I answer Issue No.1 on the respondent’s brief in similar vein.
Issue No.2 on each of the briefs poses the question whether the respondents proved the claim for special damages as required under the law as to entitle them to the award of N870,000.00. The plaintiffs/respondents had in the statement of claim sought an award of special damages for the way and manner the defendant/appellant aborted the tours. They had claimed special damages as follows:
Particulars Of Special Damages
(1) Loss of earnings from gate takings as stated N870,000.00 in paragraph 19 above
(2) Loss of earnings from money sprayed by guests as stated in paragraph 19 above – N720,000.00
Total = N1,590,000.00
As I have said, the case is founded on a breach of contract. The law is that a party to a contract who does not receive the promised performance because of a breach by the other party is entitled to compensation which normally takes the form of damages. As a victim of a breach of contract, he is entitled to compensation for any loss which resulted from the breach and which is neither too remote nor unlikely, a consequence nor one which he could have avoided by taking reasonable steps in mitigation. He is, in law, entitled to be placed in the same position as if the contract had been performed – restitutio in integrum. See: L.C.C. v. Unachukwu & All (1978) 3 SC 199.
The basis for the claim of N870,000.00 and N10,000.00 is as stated in paragraph 18 of the statement of claim which reads:
“The venues and the dates on which the ten (10) concerts were stated to have taken place as well as the anticipated income which the plaintiffs lost are stated thus:
The ten cities or towns where the concert was to take place, the anticipated earnings from gate takings, their anticipated 40% share of same and the anticipated earnings from money sprayed by guests were hereunder stated.
The losses claimed here are, in my view, compensation for consequential loss of profit or expectation see (1) Manubens v. Leon (1919) 1 KB 208 and Chaplin v. Hicks (1919) 2KB 786. Testifying, PW1 said:
“All the shows scheduled for the 10 cities were to be live performances, I have a lot of admirers who enjoy my music and when we are sprayed with Naira we make about N100,000.00 to N150,000.00 per show. When I compute what is due to us on (sic) pleaded in our paragraph 15 of our statement of claim I do aver positively that it is a good representation of our losses. The gate fee is N150.00 per head. We are to receive 40% of the ticket intake sales.
My shows were for promotional matters. Even if not a wedding or birthday party, there is no way I will not be sprayed with money, it is not only when I promise people that they spray me – speaking Ibo or Hausa evoked such emotion, leading to hearing (sic) spraying. That is extra payment for me not part of the contract sum.”
I have had a careful study of the testimony of DW1 – Olufunsho Ogundipe, there is nothing therein that contradicts the evidence of PW1 on gate takings. Where evidence of a party remains unchallenged, the court of law and justice is duty bound to believe that testimony and act on it. The trial judge rightly in my view believed the testimony of the plaintiffs/respondents on this issue and of course, rightly rejected the evidence on anticipated earnings from money expected to be sprayed by the guests. Indeed, there was no persuasive evidence on the second limb of the claim. Issue No.2 on each of the briefs is thus answered in the affirmative. The plaintiffs/respondents, as said above have cross-appealed.
They have claimed for general damages in two lots (1) N50 million, being damages for the defendant’s unilateral and flagrant breach of the agreement reached concerning the musical tour of the ten Northern States and (2) N50 million being damages for the plaintiffs’ loss of reputation and goodwill occasioned by the defendant’s unilateral breach of the agreement. Suffice it to say that the claim for N50 million for breach of contract was abandoned. I have set out the principles guiding the court in the award of damages in this kind of case. I have looked at the arguments for and against as canvassed by the parties in their different briefs of argument. I have also itemized the losses flowing from the aforesaid breach of contract.
Damages, which are compensation in money, are sum of money given to a successful party as compensation for loss or harm of any kind flowing from the breach. If a party, as in the instant case, has been duly compensated for that loss or harm he suffered from the breach, it is not in doubt that it is no more open to a court of law to proceed to award him any other kind of additional damages which will sound like double compensation or a bonus- see (1) Soetan & An. v. Ogunwo (1975) 6 SC 67 and (2) Lagos City Council Caretaker Committee & An supra issue No.1 on the brief of the cross/appellant is therefore answered in the affirmative while I answer Issue No.1 on the brief of the cross-respondent in the same vein. Issue No.2 on each of the briefs of the cross-appellant and the cross-respondent are both resolved against the cross-appellant.
In conclusion, from what I have been saying above, the appeal is in my judgment, unmeritorious and the cross-appeal itself lacks merit. Both are hereby dismissed. Both sides shall bear their costs.
Other Citations: (2004)LCN/1527(CA)