IN THE SUPERIOR COURT OF JUDICATURE
IN THE HIGH COURT (COMMERCIAL DIVISION)
KUMASI - A.D 2015
BERNARD ANSAH - (Plaintiff)
SIMON BAIDOO - (defendant)
DATE: 8TH DECEMBER, 2015
SUIT NO: RPC/34/14
JUDGES: HER LADYSHIP ANGELINA MENSAH-HOMIAH (MRS.) JUSTICE OF THE HIGH COURT
KWABENA POKU MENSAH FOR PLAINTIFF
BENJAMIN K. ACOLATSE FOR DEFENDANT
This action arose from disagreements between the parties herein over a sale of goods contract whereby used printers were to be supplied by the Plaintiff to the Defendant. The Plaintiff is claiming an unpaid balance of fifteen thousand five hundred Euros (E15,500.00) together with interest.
A summary of the Plaintiff's case as contained in his statement of claim filed on 14/10/2013 is that somewhere in July 2012, the defendant approached him to facilitate the purchase of printing machines from Germany for his printing business. The Defendant is said to have turned down two machines earlier supplied to him and they were replaced. The Plaintiff quoted the purchase price as forty three thousand Euros ( E 43,000.00) out of which the Defendant paid twenty Seven Thousand, Five Hundred Euros, leaving an unpaid balance of Fifteen Thousand and Five Hundred Euros ( E 15,500.00).
The Defendant's defence is encapsulated in a 14- paragraphed statement of defence filed on 28/11/13. His case was that the Plaintiff supplied him with different specifications and models of the printing machines , contrary to their agreement. Besides, the machines were delivered late, causing him to borrow additional monies to carry out his printing works so as not to disappoint his customers. He further pleaded that the price was quoted in Cedis, but not in Euros, and he in fact made a part payment of GHS 62,000.00 in addition to a commitment fee of GH¢ 2,000.00, out of the total sale price of GH¢ 130,000.00. These machines turned out to be defective. And, to the knowledge of the Plaintiff, he incurred extra expenses by way of payments to engineers in his attempt to make the machines operational.
Therefore, the defendant counterclaimed as follows:
(1) For an order to compel the Plaintiff to supply him with 2 units of slightly used Kord 64 printing machines with a set off of costs incurred in an attempt to repair the malfunctioning Kord 62 used printing machine earlier supplied by the Plaintiff and retrieve the said malfunctioning Kord 62 used printing machine from the Defendant's workshop.
OR in the alternative the Plaintiff should be ordered by this court to refund all monies totaling Thirteen Thousand Ghana Cedis ( GH¢ 13,000.00) as at 31st July 2013 excluding interest spent by the Defendant in an effort to repair the supplied one unit of Kord 62 used printing machine and retrieve the said malfunctioning Kord 62 used printing machine from the Defendant's workshop.
(2) An order to compel the Plaintiff to reimburse him with all monies totaling Fourteen Thousand
Nine Hundred Ghana Cedis ( GH¢14, 900.00) as at 31st December 2012 excluding interest spent on repair works on the Heidelberg MO slightly used machine supplied.
OR in the alternative the Plaintiff should be compelled to use the said amount incurred in repairing the aforesaid Heidelberg MO slightly used machine to defray the outstanding just balance on Defendant's account.
5. Any further orders as this Honourable Court may deem fit.
The issues for determination are:
1. Whether the parties contracted for the purchase by the Plaintiff of one (1) Heidelberg 32 MO 2-colour Printing Machine and two(2) units of Kord 64 Printing Machines?
2. Whether the Plaintiff delivered to the Defendant one (1) Heidelberg 32 MO 2-colour Printing Machine and one (1) Heidelberg Kord 62 Printing Machine?
3. Whether the Defendant is indebted to the Plaintiff in the sum of Fifteen Thousand Five Hundred Euros ( E 15,500) or its Cedi equivalent?
4. Whether the Defendant took delivery of one (1) Heidelberg 32 MO 2-colour Printing Machine and one (1) Heidelberg Kord 62 Printing Machine?
5. Whether the Defendant contracted with the Plaintiff for the purchase of slightly used printing machines or for used printing machines?
6. Whether the Defendant incurred any expenses in his alleged attempts to get the delivered machines repaired and whether the alleged expenses were brought to the notice of the Plaintiff?
7. Whether the Defendant is entitled to his counterclaim?
Whether the parties contracted for the purchase by the Plaintiff of one (1) Heidelberg 32 MO 2-colour Printing Machine and two(2) units of Kord 64 Printing Machines?
In paragraph 4 of the Plaintiff's statement of claim, there is no mention of the exact printing machines which were to be supplied. The Plaintiff merely averred that the Defendant after turning down two machines brought to him from Germany, accepted a Heidelberg Kord 62 and a Heidelberg 32 MO 2 Colour.
Rather, it is the Defendant who positively averred in paragraph 5 of his statement of defence that he requested from the Plaintiff three (3) units of slightly used printing machines comprising one (1) unit 2- colour Heidelberg MO and two (2) units Kord 64 printing machines. Going by the well established principles of proof in civil suits, the evidential burden as well as the burden of persuasion first rest on the Defendant.
Whilst giving evidence in court on 11/02/2015, the Defendant said that even though the original agreement was for the supply of two units of Heidelberg Kord 64 and one unit of the Heidelberg MO 2 colour, he eventually accepted one unit of Kord 62 and one unit of the MO two-colour because the operators had told him that there was not much difference between the Kord 64 and the Kord 62. In support of this oral testimony, the Defendant tendered exhibit 2, an undertaking signed by him whereby the Plaintiff d supposedly acknowledged receipt of a GHS 2000 deposit towards the supply of three printing machines, namely, one unit of Heidelberg Mo and two one-colour Kord 64 machines. To the extent that the Plaintiff's signature does not appear on exhibit 2, coupled with the fact that the same was prepared by the Defendant, it is a self-serving document and of no probative value.
The Plaintiff's exhibit B becomes the only credible documentary proof on this issue. Exhibit B was signed by the parties herein before their respective witnesses. It states in part that " the amount received is a part payment of Printing Machines:- 1 Two-Colour Heidelberg MO, and 2 Kord 62 Heidelberg printing machines" which the defendant was buying from the Plaintiff.
From the above, the burden shifted onto the Defendant to prove otherwise but he failed to establish on the balance of probabilities that a Kord 64 was part of the agreement. Per exhibit B, the Plaintiff's defence that the supply of Kord 64 printing machines was not part of the agreement is to be preferred. It does not matter who prepared exhibit B. Once the Parties to exhibit B are literate, and in the absence of duress or undue influence, I find that the Parties contracted for the supply of one unit Two-colour Heidelberg MO and two units Kord 62 Heidelberg printing machines.
Whether the Plaintiff delivered to the Defendant one (1) Heidelberg 32 MO 2-colour Printing Machine and one (1) Heidelberg Kord 62 Printing Machine?
The Plaintiff's case is that he eventually supplied to the Defendant two machines, namely, a Heidelberg Kord 62 and a Heidelberg 32 MO two-colour. Even though this assertion was initially denied by the Defendant, he stated categorically in paragraph 11 of his defence that the Plaintiff brought the units described above to him, but the same were defective. I therefore find that the Plaintiff actually delivered one (1) Heidelberg 32 MO 2-colour Printing Machine and one (1) Heidelberg Kord 62 Printing Machine to the Defendant, irrespective of the original agreement to deliver two units of Kord 62 and one unit of the MO two colour. This finding also disposes of the 4th issue as to whether the Defendant took delivery of one (1) Heidelberg 32 MO 2-colour Printing Machine and one (1) Heidelberg Kord 62 Printing Machine.
Whether the Defendant contracted with the Plaintiff for the purchase of slightly used printing machines or for used printing machines?
Again, the evidential burden as well as the burden of persuasion on this issue rests on the Defendant. He gave oral evidence to the effect that the Plaintiff was to supply him with slightly used printing machines. This was however not documented because no such documentation was brought to the notice of this court. Counsel for the Plaintiff sought to make inferences from exhibit 2 to demonstrate that used machines were to be supplied to the Defendant. But, as i have already found, exhibit 2 is of no probative value and the same will not be relied on by this court.
By the Defendant's own showing, he was not to be supplied with brand new machines. I do not see the difference between "used" and "slightly used" machines. In my view, they belong to the same category of used machines. It was up to the defendant to determine upon supply whether the machines were fit for his purpose. If not, he could exercise his right of rejection under the Sale of Goods Act, 1962 Act 137. The evidence even shows that he had previously rejected two used machines delivered to him.
Whether the Defendant is indebted to the Plaintiff in the sum of Fifteen Thousand Five Hundred Euros ( E 15,500) or its Cedi equivalent?
Obviously, the burden of proof of this issue is on the Plaintiff. He testified that the agreed purchase price for the two machines he supplied to the Defendant was 43,000.00 Euros and that the defendant made a part payment of 27,500.00, leaving a balance of 15, 500.00 Euros. He tendered exhibit C, which bears only his signature as proof. This also raises credibility issues. Why is it that the Defendant's signature does not appear on the portion of exhibit C where a customer is supposed to sign? when the Plaintiff was pinned down during cross-examination, he stated that after the Defendant had prepared exhibit B for him to sign, he also prepared exhibit C. Yet, i do not see any connection between exhibits B and C as far as the prices are concerned.
Whereas exhibit B was made on 20/02/2012 prior to the supply of the machines and quotes figures in Ghana Cedis, Exhibit C is dated 27/07/2012, it came into existence after the supply of the machines and quotes the price in Euros. In other words, exhibit B preceded exhibit C. It makes business sense for parties to a sales agreement to come to terms on what is to be supplied prior to delivery and not after delivery has been made. The contents as regards price also differ. Why would the Plaintiff who is literate sign exhibit B if it did not capture what had actually transpired between the parties? I find exhibit B which bears the signatures of both parties and which was executed before the machines were supplied as more convincing than exhibit C which was unilaterally made by the Plaintiff.
It is to be noticed that exhibit B does not state the unit price of each of the printing machines. On the face of it, the part-payment covered three machines, but only two machines were in fact supplied by the Plaintiff.
On the part of the Defendant, he gave the total price as GH¢ 130,000.00, out of which he paid GH¢ 46,000.00. As regards the unit price, the Defendant testified that the MO costs GH¢80,000.00 and the Kord 64 costs GH¢ 25,000.00 each.
Since the Plaintiff has failed to lead convincing evidence as regards the unit price of each printing machine, he is deemed to have failed in proving that issue. In the circumstance, the Defendant's evidence on the unit prices will be accepted. Bearing in mind the Defendant's earlier assertion that he was made to understand that there is not much difference between the Kord 62 and the Kord 64, i will also peg the price of a unit of Kord 62 at Gh¢ 25,000.00. I therefore conclude that the unit price of the MO two-colour Printing Machine was GH¢ 80,000.00 and the Kord 62 was Gh¢25,000.00. Thus, the total cost of the two machines supplied to the Defendant was GHS105,000.00. The third machine as per exhibit B was never supplied so as to bring the total cost to GH¢ 130,000.00.
On the balance of probabilities, the Defendant's testimony that he paid a deposit of GH¢ 2,000.00 is not convincing. Just as i failed to put any weight on the Plaintiff's exhibit C which did not bear the signature of the Defendant, so will I also not put any weight on the payment vouchers tendered as exhibits 4 and 5 totaling GH¢62,000.00. These vouchers on the letterhead of Good Shepherded Publications are also self -serving. If the Plaintiff had in fact received those monies, he would have signed these payment vouchers. In the absence of the Plaintiff's signature on these vouchers indicating receipt of the monies stated therein, i will not hold them against him. I find that the only credible evidence about payment received from the Defendant is the part payment of GH¢46,000.00 referred to in exhibit B. In the circumstance, I will deduct the GH¢46,000.00 down payment from the GH¢ 105,000.00 total cost. The balance outstanding will be GH¢ 59,000.00.
Whether the Defendant incurred any expenses in his alleged attempts to get the delivered machines repaired and whether the alleged expenses were brought to the notice of the Plaintiff
In discharging his legal burden, the Defendant testified that right from the day the machines were supplied, he discovered that there were mal-functional. He brought this to the notice of the Plaintiff who recommended his engineers and subsequently, external engineers to work on the machines. DW2 said the machines were too old and were not functioning. However, DW1 and DW3 said they worked on the MO machine at different times and it started functioning. DW1 however pointed out that the sensor was faulty, and he told the Defendant to order one from abroad. But, to his knowledge that was not done. Not much has been said about repairs carried out on the Kord 62.
From the evidence of the Defendant and his witnesses, various sums of money were spent in repairing these machines. The Defendant said he spent GH¢ 3,000.00 in repairing the Kord 62 , but not to his satisfaction and that he spent a further GH¢ 14,900.00 in repairing the MO two-colour. Counsel for the Defendant punched serious holes into these expenses during cross-examination and in his closing address. I will revert to the details, if need be.
In deciding whether to saddle the Plaintiff with these expenses or any part thereof, the court must first determine whether at the time these expenses were incurred, property in the goods had passed within the meaning of the Sale of Goods Act. Section 26 of the Sale of Goods Act becomes relevant here. It provides thus:
26. When property passes
(1) Subject to section 25, the property in the goods passes under a contract of sale when the parties intend it to pass.
(2) Unless a different intention is apparent, the property in the goods passes under a contract of sale when they are delivered to the buyer.
(3) Where goods are delivered to the buyer on approval or “on sale or return” or any other similar terms, then, in the absence of a contrary intention, the property in the goods passes to the buyer
(a) When the buyer signifies the buyer’s approval or acceptance to the seller or does any other act adopting the transaction;
(b) if the buyer does not signify the buyer’s approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of that time, and if a time has not been fixed, on the expiration of a reasonable time.
Looking at the antecedents of this case, particularly the fact that the Defendant had exercised his right of rejection in respect of two printing machines earlier supplied to him, it can be reasonably inferred that the machines in issue were delivered to him subject to his approval (see section 26(3) of Act 262, supra).
The evidence on record shows that the Defendant actually had opportunity to inspect the Heidelberg Kord 62 and Heidelberg MO two-Colour machines when the same were delivered to him by the Plaintiff somewhere in July, 2012. Between July, 2012 and September, 2012, the exhibits 9 series indicate that various sums of money were spent on installation and repairs carried out on these machines. During cross-examination of DW3 on 09/10/2015, he admitted that some of the repairs he carried out on the Mo two- colour printing machine were routine repairs and that the Defendant called him to work on the machine from time to time , depending on how the machine was used. DW3 further told the court that he even did general over hauling about four to five months prior to the date of his testimony.
On the totality of the evidence on record, I find that the Defendant accepted the used Heidelberg Kord 62 and Heidelberg MO two-colour printing machines supplied to him, he allowed various engineers to work on the same from the time of delivery and beyond. By the Defendant's own conduct of keeping the machines over such an unreasonably long period, he had lost the right of rejection. See Rockson v Armah (1975) 2 GLR 116 at 117 , holding 3, CA.
I will uphold the submissions of counsel for the Plaintiff on this matter and, on the basis of the evidence before me, i find that property in these machines had passed to the Defendant at the time these repairs were being carried out .
Since property in the goods had passed, all the associated risks had also passed from the seller to the buyer within the meaning of section 27 (2) of the Sale of Goods Act
It is to be noticed that Counsel for the Plaintiff spent time in his closing submissions on the payment vouchers tendered by the Defendant on repairs- Counsel actually subjected them to the microscopic scrutiny they deserved. I am of the opinion that the Defendant did incur expenses on installation, parts, overhauling, routine maintenance, among others. But, these are not out of place bearing in mind that the machines were used machines. The Defendant ought to have known the associated risks in buying used machines. In Rockson v Armah (supra), the court cited with approval the statement of Denning M.R. in Bartlett v Sidney Marcus Ltd. (1965) 2 All E.R. 753, C.A. at page 755 thus:
... A buyer should realise that, when he buys a secondhand car, defects may appear sooner or later; and, in the absence of any express warranty, he has no redress."
In the instant case, there is no credible proof that the Plaintiff had warranted that the second machines were free of defects. The Defendant inspected them and accepted them in the condition he found them because he knew that they were old and used machines. Accordingly, the Plaintiff cannot be held liable for any expenses incurred by the Defendant in carrying out repairs on the used printing machines delivered to him by the Plaintiff pursuant to the sales agreement, whether or not he brought these to the notice of the Plaintiff.
Per the endorsement on the Plaintiff's writ of summons, he claimed the sum of 15, 500 Euros or its cedi equivalent. Having gone through the evidence, I will enter judgment in favour of the Plaintiff in the sum of GHS 59,000.00.
Is the Plaintiff entitled to interest on this amount? By the provisions of Section 15 of Act 137, payment is concurrent with delivery until the parties agree otherwise. In the instant case, delivery was made sometime in July, 2012, but full payment has not been forthcoming. I find that payment ought to have been made within a reasonable time after delivery, but there has been unreasonably long delay on the part of the Defendant to fulfill his obligation to pay for the goods supplied.
The law is that when a party holds onto monies belonging to another without just cause, that other party is entitled to interest. In Akoto v Gyamfi-Addo (2005-2006) SCGLR 1018, the Supreme Court took the view that the general principle for the award of interest to a party was that such a party had been unjustifiably kept out of money due to him or her for the relevant period. See also Harbutt’s Plasticine Ltd v Wayne Tank & Pump Co. Ltd (1970) 1 All ER 225 and London, Chatham & Dover Railway Co. V South Eastern railway Co,. (1893) AC 429 where interest payment was ordered when a party had been driven to court by reason of the defendant's non-payment of monies payable to the Plaintiff.
Per exhibit B, the Defendant was to liquidate his indebtedness during the 2012 academic year. No specific date was given. Judicial notice has been taken of the fact that the academic year in Ghana ends in July. Reading exhibit B as a whole and considering the time of delivery in July 2012, the 2012 academic year as used is to be interpreted as 2012/2013 academic year. That way, the Defendant was to have finished payment by July, 2013. i will therefore order the Defendant to pay interest on the judgment debt from August, 2013.
Having considered the evidence as a whole, I will dismiss the Defendant's numerous counterclaims as unmeritorious and without any basis.
Judgment entered in favour of the Plaintiff for the sum of GHS 59,000.00 together with interest at the prevailing Bank rate from August 2013 till date of delivery of judgment. I also order the Defendant to pay post judgment interest at the prevailing bank rate from the date of delivery of judgment till date of final payment. For the avoidance of doubt, the Bank of Ghana 91-days Treasury Bill rate is to be used as the Prevailing Bank Rate.
I wish to add that Counsel for the Defendant failed to file his closing submissions within the time line set by the court. I therefore proceeded to write the judgment without having the benefit of this address.
I award cost of GH¢3000.00 against the Defendant in favour of the plaintiff.
ANGELINA MENSAH-HOMIAH (MRS.)
JUSTICE OF THE HIGH COURT