Akzo Chemite G.M.B.H v M.R. Patel & Company [1979] FijiLawRp 15; [1979] 25 FLR 6 (4 January 1979)

[1979] 25 FLR 6

SUPREME COURT OF FIJI

Civil Jurisdiction

AKZO CHEMITE G.M.B.H.

v

M. R. PATEL & COMPANY

Mishra, J.

4 January 1979

F. G. Keil for Plaintiff.
G. P. Shankar for the Defendant.

Breach of contract by defendant refusing to complete - no evidence to assist estimation of damages - court makes own calculation.

Plaintiff an exporter of edible oil based in West Germany sued the defendant an importer of oil at Nausori, Fiji, for damages arising out of an alleged breach of contract for sale and purchase of 36 metric tons of edible oil.

The plaintiff's case was that the defendant through its agent Pacific Trading after delivery and acceptance of 6 tons of the said oil, stopped further delivery and refused to accept delivery and complete the contract.

The defendant admitted these allegations but said it was entitled to treat the contract as discharged by breach on the plaintiff's part. The defence was summarised thus -

(a) Time was of the essence.

(b) That it was an express or implied condition that the edible oil was to be of merchantable quality and fit for that purpose.

(c) The defendants were not to bear any price increases.

The trial Judge concluded that when the defendant refused further delivery it did so because of a drop in the market price and that as there was no price increase by the plaintiff, there was no breach on the part of the plaintiff for which defendant could find the contract discharged.

Further the Court stated that as a result the plaintiff was not able to sell the balance of the oil at the price in the contract fixed for it in Fiji but there was no evidence of any sale or any price at which it was or could be sold nor was there any evidence of the profit the plaintiff would have made if the sale of the contract in Fiji had been completed. Nor was there any evidence of any market price in Fiji at the relevant time which might have assisted a calculation or damages. It was the plaintiff's onus to provide this information.

In these circumstances the court sought to arrive at a loss by working out a profit on the sale at such a percentage of profit as would not do injustice to the defendant. The court then made an estimate at what the profit content would have been on the contract price. For reasons stated, it decided on 12½% of contract price.

Held: Judgment for the plaintiff was entered in the sum of D.M. 11,437 at the exchange rate prevailing at the date of judgment with costs.

(Upheld on appeal: 25 July 1979)

Case referred to:

Household Machines v. Cosmos Exporters (1947) 1 KB 217.

MISHRA. J:

JUDGMENT

Plaintiff is an exporter of edible oil based in West Germany. Defendant is an importer of oil based at Nausori Fiji.

Plaintiff's claim is for damages arising out of an alleged breach of contract for sale and purchase of edible oil.

The relevant part of the statement of claim relating to the alleged breach is as follows:

"4. The Defendants through the Plaintiff's agent in Fiji Pacific Trading Company by order No. 1865 dated 31st October 1974 placed an order with the Plaintiff for the supply and delivery of 36 metric tons of refined deodorized edible soya bean salad oil for shipment and at a price as follows:

6 M. Tons November	74 Shipment at DM 3080 per M. Ton CIFC
10 M. Tons February	75 Shipment at DM 3050 per M .Ton CIFC
10 M. Tons March	75 Shipment at DM 3050 per M. Ton CIFC
10 M. Tons April	75 Shipment at DM 3050 per M. Ton CIFC

5. The said order was confirmed by the Plaintiff.

6. In pursuance of the said contract the Plaintiff, shipped and the Defendants accepted delivery of six (6) metric tons of the said oil in November 1974.

7. The Defendants through the Plaintiff's said agent Pacific Trading Company stopped further delivery of the said order by letter to the Plaintiff dated the 18th January 1975.

8. Despite repeated requests the Defendants have refused to accept delivery and complete the contract for the balance of the said order of oil of 30 metric tons."

The defendant admits these allegations but says that he was entitled to treat the contract as discharged by breach on the plaintiff's part. Paragraphs 2 and 5 of the Defence are formulated thus:

"2.That the defendants admit paragraph 4 of the Statement of Claim but says:

(a) that time was of essence;

(b) that it was an express or implied condition that the edible oil was to be of merchantable quality and fit for that purpose;

(c) that the defendant were not to bear any price increases.

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5. That as to paragraph 7 of the Statement of Claim the defendants say that they properly rescinded the order since the plaintiff was in the breach of it as the goods were not supplied in stipulated time and there has been a price increase."

At the trial several documents (Ex. A1 to Ex. A11) were put in evidence by agreement. In addition plaintiff's counsel called two witnesses, Ramesh Patel, who was the plaintiffs agent in Fiji at the relevant time and Veer Chand who represents the plaintiff in Fiji at the present time.

No evidence was led for the Defence.

On the evidence before me I hold that there was a contract for sale and purchase of a fixed quantity of oil at a fixed price over a fixed period, instalments to be delivered in November 1974 and February, March and April 1975. No date was specified for any of the months.