IN THE SUPREME COURT OF NIGERIA
ON MONDAY, THE 2ND DAY OF MARCH 1970
S.M. DAPS BROWN ................................................ PLAINTIFF
HACO LIMITED ...................................................... DEFENDANTS
BEFORE: Dosunmu, J.
The plaintiff brought an action against the defendants claiming the sum of £300 deposited by the plaintiff with the defendants in accordance with an agreement between the parties; arrears of salary and repatriations expenses from Lagos to Kano.
The plaintiff was employed by the defendants company in 1957 at Kano as a clerk. He entered into a service agreement under which he made a deposit of £100 to the defendants. This amount had steadily increased and stood at £261.6s.0d.on 1st October, 1966.
In 1958, he was transferred to Lagos as a store-keeper on a salary of £40 per month. In July, 1966, he was transferred to Port Harcourt. On the 1st July, 1967, owing to the activities of the rebels in the former Eastern Nigeria, the defendants co. moved their business from Port-Harcourt to Aba. IN 1968, after the recapture of Port Harcourt he found his way to Lagos and reported his arrival at the headquarter of the defendants co. and claimed his salary from July, 1967, to date.
The defendants contended that since the parties had lost touch completely owing to the civil war the contract of employment between them had been frustrated.
(1) On the subject of frustration of a contract the principle is that if there is an event or change of circumstance which is so fundamental as to be regarded by the law as striking at the root of the contract as a whole and beyond what was contemplated by the parties and such that to hold the parties to the contract would be to bind them to something to which they would not have agreed had they contemplated that event or those circumstances, the contract is frustrated by that event immediately and irrespective of the volition or the intention or the knowledge of the parties as to that particular event, and even although they have continued for a time to treat the contract as still subsisting.
(2) In this case, owing to the civil war and the blockade of the former Eastern Region, the plaintiff was cut away from his employers, and for period of over twelve months his employers had no continuous relation with him. The stocks of the defendant company which the plaintiff took charge of were no where available, and he could not now account for them. Consequently, there has occurred such a change of circumstances to frustrate the contract of employment.
Plaintiff's Claim succeeds in part
Cases referred to:
Morgan v. Manser (1947) 2 A.E.R. 666, 668.
Unger v. Preston Corporation (1942) 1 A.E.R. 200
Makanju, for the Plaintiff
Franklin, for the Defendants
Dosunmu, J.:-In this suit the plaintiff claims against the defendants as follows:-
(a) The sum of £300 deposited by the plaintiff with the defendants with interest there on at the rate of 6% per annum in accordance with Clause 15 of the agreement between the parties dated 7th day of December, 1957.
(b) Arrears of salary at the rate of £40 per month and equated bonus at the rate of £10 per month from July, 1967, up to date of judgment.
(c) £300 being repatriation expenses from the plaintiff and his family from Lagos to Kano.
Pleadings were ordered and filed. The plaintiff alone gave evidence on his own behalf. He was employed by the defendant company in 1957 at Kano as a clerk and he entered into service agreement and marked exhibit A. Under Clause 15 of the said exhibit A, he made a deposit of £100 to the defendant. This amount has increased from time to time and it stood at £261. 6s. 0d. on 1/10/66 as per exhibit G. In 1958, he was transferred to Lagos as a store-keeper on a salary of £40 per month. In July, 1966, he was transferred to Port Harcourt on the same salary but he was to receive, in addition, a bonus which was dependent on the amount of sales recorded in the month. He remained in Port Harcourt up to June, 1967. On the 19th of June, 1967, some discrepancies were discovered in his stock and with the aid of the Company's Supervisor based at Onitsha, the amount of discrepancies were ascertained to be £172.9s.3d. In conformity with the service agreement exhibit A, the plaintiff agreed that this amount should be debited to his account. he was the store-keeper and solely in charge of, and responsible for the defendants' stock at Port Harcourt. On the 1st of July, 1967, due to the activities of the rebels in the former Eastern Nigeria, the plaintiff said that the defendant company moved their business from Port Harcourt to Aba when the latter place was considered safer. But he did not go with the Company although the stocks committed to his charge were moved to Aba. I have no evidence from him as to who authorised this movement, and as to what he was then doing behind at Port Harcourt on behalf of the Company, if any. But I am prepared to take judicial notice of the fact that it would almost be impossible, if not dangerous for him, to leave the former Eastern Region at that time, he being a native of the then Eastern Nigeria.
In May, 1968, the Federal Forces recaptured Port Harcourt. At the time of the liberation of Port Harcourt, the plaintiff claimed that he was in hiding somewhere in the out-skirts. In September, 1968. At Lagos he contacted the General Manager of the defendant company who did not help him much about his wages which he said he did not receive throughout as from July, 1967, to date. And it is his salary for this period that he is now claiming. Many letters written on his behalf to the defendant company yielded no results.
The defence also called a witness, Mr K.C. Lowey the Acting General Manager of the Company. He testified that the control of all branches of their Company was from the Headquarters in Lagos. As regards the plaintiff, he said it was in June, 1967, that the Company last heard anything about him or get any service from him. From the last few days in June, their company lost touch with all their employees in the former Eastern Region due to the civil war. The transfer of the Port Harcourt branch to Aba was never authorised from the Headquarters and due to the blockade, no representative of the Company has been able to go to the former Eastern Region to know the fate of their shops and stocks there.
The case for the defendant is that by May, 1967, the parties have lost touch completely due to the civil war and the Headquarters in Lagos have been out away from their branches in the former Eastern Region since the end of June, 1967. Nothing was heard or seen of the plaintiff until he emerged in Lagos in September, 1968. It is their contention, therefore, that the events that have supervened, that is, the outbreak of the civil war in Nigeria and the consequent blockade of the former Eastern Region from the rest of Nigeria frustrated the contract of employment between them.
Before going further let me quickly dispose of the claim for deposit. It was agreed by both Counsel that the amount due to the plaintiff in this respect is £150.18s.3d. The defendants had earlier paid into Court an amount of £150.18s.3d. in favour of the plaintiff, but this was after pleadings were concluded and issues were joined.
I now come back to the question of frustration of a contact. Strealfield, J., in Morgan v. Manser (1947) 2 A.E.R. 666, 668 asked the question what is frustration of a contract? In that case by a contract dated February 8, 1938, a variety artiste engaged a manager for a period of 10 years for the purpose of obtaining engagements in music halls, theatres, etc., in any part of the world, the manager undertaking to obtain publicity in advertising in any way he might think fit. In June, 1940, the artiste was called up for service in the army, and, after 18 months of military training, was transferred to the Army Entertainment Pool, in which he continued to serve until he was demobilised in February, 1946. The parties continued, so far as it was possible in the circumstances, to treat the contract as still subsisting, the manager endeavouring to keep the artiste's name before the public and potential employers after the war.
Held: That there was such a change of circumstances and for such a duration and the original contract, looked at as a whole, was so fundamentally invaded by the calling up of the artiste that it must be considered as frustrated by reason of the event. The learned judge discussed the various theories in a number of English cases that have been put forward and examined in the House of Lords on the subject of frustration of a contract, and he concluded in these words: "From those authorities it seems to me that, whether relief is given by way of implying a term or otherwise, the principle may be stated in this way. If there is an event or change of circumstances which is so fundamental as to be regarded by the law as striking at the root of the contract as a whole, and beyond what was contemplated by the parties and such that to hold the parties to the contract would be to bind them to something to which they would not have agreed had they contemplated that event or these circumstances, the contract is frustrated by that event immediately and irrespective of the volition or the intention or the knowledge of the parties as to that particular event and even although they have continued for a time to treat the contract as still subsisting."
In Unger v. Preston Corporation (1942) 1 A.E.R. 200 the facts are as follows:- Plaintiff who was a refugee from Germany, was engaged by the defendants before the out-break of war as a full time school medical officer. In June, 1940, he was interned as an enemy alien, and was not released until March, 1941. In reply to a claim by the plaintiff for payment of his salary during the period he was interned, defendants contended that according to the doctrine of frustration his contract of employment had been automatically terminated on his internment.
Held: the contract between the parties had been frustrated and, therefore, plaintiff's engagement terminated on his internment.
In the instant case, due to the Civil War and the blockade of the former Eastern Region, the plaintiff was cut away from his employers and from June, 1967 to September, 1968, which is more than 12 months his employers had no continuous relation with him. The stocks of the defendant company which the plaintiff took charge of are no where available, and he could not now account for them. I have reached the conclusion in the circumstance of this case that there has occurred such a change of circumstances to frustrate the contract of employment.
It was submitted by Mr Makanju for the plaintiff that the parties ought to have provided for the events that happened or as he put it, at the outbreak of the civil war the defendant company exhibit A in their hands, should have made necessary amendments to take care of the situation. I do not know how the defendants could have validly made any amendment to the service agreement unilaterally since they have no access to the plaintiff at all. The parties must be more than human or human organisation to foresee the Nigerian Civil War. Mr Makanju also referred to Clause 3 of the service agreement exhibit A which provides that notice of termination of contract to be given by the defendant as well as the plaintiff one month from the actual date of termination. This is relevant where the parties consciously want to bring the contract to an end. But the events which have happened are beyond their control and I accept the defendant's submission that the contract of service has been frustrated by the Civil War and each party is discharged.
As to the other items of claims, the plaintiff's Counsel properly conceded that they have not been made out. In the result I will enter a formal judgment for the plaintiff in the sum of £150.18s.3d. being refund of his deposit. But this amount I understand already paid into Court has been withdrawn by the plaintiff. All the other items of claims are accordingly dismissed. The plaintiff cannot have full costs having lost the major part of his claims. I award him 65 guineas costs which include his out of pocket expenses.
Plaintiff's claim succeed in part.