Kakubhai v Majid (Civil Cause 414 of 1987) [1990] MWHC 21 (15 June 1990)

IN THE HIGH COURT OF MALAWI PRINCIPAL REGISTRY CIVIL CAUSE NO. 414 OF 1987 BETWEEN: LALJT KAKUBHAL ..........002605022006 . PLAINTIFF - AND - ABDUL MAJID ........-.. 2005520020 DEFENDANT Coram: MKANDAWIRE, J. OO Osman of Counsel for the Plaintiff ya _ Msisha of Counsel for the Defendant’ Kadyakale, Official Interpreter il Gausi (Mrs). Court Reporter \ JUDGMENT Both parties in this case are traders dealing in Wholesale business. By his amended statement of claim. the plaintiff claims the sum of K22,050 being the balance of the price of goods sold and delivered by the plaintiff to the defendant at the defendant's request. There is a further claim of K552.50 being extra charges the plaintiff had to pay as a result of the defendant's failure to pay for the goods in time. It is common case that there was a contract of sale between the parties. The plaintiff agreed to sell and the defendant agreed to buy 4.500 bags of salt. The plaintiff kept his salt at two warehouses; Inter- national Cargo Handlers and Trans Maritime. It was agreed that the defendant would collect the bags of Salt from the warehouses. The plaintiff gave the defendant release orders which authorised the latter to collect the salt from the warehouses. At the end of the day, however. the defendant collected only 4,410 bags as 90 were extensively damaged. In this transaction, the plaintiff acted in person while all throughout the defendant acted through his emplcyee Shabir Suleman. who was the buyer. What is in dispute is the orice of the salt. It was the evidence of the plaintiff that it was agreed that the defendant would buy the salt at K17.50 a bag. He told the court that the defen iant had suggested that out of this K17.50, K12.50 would be invoiced and paid by cheque but K5.00 would not be on invoice as the defendant would pay cash. The plaintiff accepted this proposal. To him, the mode of payment was not important. What mattered was that he was going to get the agreed K17.50 per bag. He then issued the defendant with release orders in various amounts to enable him collect the sait from the warehouses. It was the plaintiff's evidence that the release orders were in the amounts required by the defendant The agreement was that payment would be made after the salt was collected. When the defendant finished collecting. the plaintiff wrote invoices demanding payment. At the time he wrote the invoices, he did not know that only 4.410 bags were collected. He had therefore invoiced the defendant for the full 4,500 bags at Ki2.50 a bag The total amount on the three invoices came to K56,250.00. These invoices were tendered in evidence as Exhibit P3. The plaintiff also prepared a document on which he indicated that the defendant was to pay an additional K5.00 per bag and this was tendered in evidence as Exhibit P9. He also prepared another document . Exhibit P10, on which he showed that the defendant was to pay K56,250.00 by cheque and K22,050.00 in cash. The invoices and Exhibit P10 were given to a Mr. Rodriques, PW2, who was sent to collect the cheque and the cash from the defendant. In cross examination the plaintiff said that he did not send the debit note Exhibit P9 to the defendant. Asked why he did not as the debit note was addressed to the defendnnt, his explanation was that he had overlooked it. He also said in cross—examination that in about June, 1987, there was devaluation of the Malawi Kwacha and that, as a result of that, some businessmen incurred Losses In the instant case the defendant started collecting the salt in May, 1987, and the plaintiff prepared the invoices on llth June, 1987. The evidence of Mr. Rodrigues, PW2, is that the plaintiff had sent him to the defendant's shop to collect the cheque and cash. He was given the invoices Exhibit P3 and Exhibit P10 which gives details of pay- ment by cheque and cash. He does not remember whom he dealt with. It was his evidence that when he got to the shop he only presented the invoices. He did not show the defendant Exhibit P10. The invoices were for 4,500 bags but he was not told that only 4,410 bags were collected. He was told to wait for one hour as someone had gone to the bank. Wher he returned in an hour's time he was told that somacne had gone to the plaintiff's place. Mr. Rodriques was rot successful in his mission. The defendant's version of the matter is that the agreed price was K12.50 pe: bag and not K17.50. He said he had never suggested tha: K12.50 should be paid on invoice and K5.00 in cash. He told the court that such an arrangement would not rake any business sense as his books would show that ae had bought the salt cheaply when in fact the actual p:ice was much higher. it was his explanation that such a transaction would have the effect of reflecting false profits. Shabir further told the court that at the time this contract was made he had asked the plaintiff to put in writing exactly what he would be required to pay. ‘The plaintiff then wrote down on a piece of paper which was tendered as Exhibit Dl. The details of this document are as follows: 500 6250 ae 3000 37500 watt COURT OF 4s os GS 43750 0? "1 an \ 1000 12500 a UT 199% | v7 it eee eer — UBRaRY oe Zo Py 4500 56250 Minas a This piece of paper does not say what the figures stand for but it was understood by the parties that the figures on the left hand side column are bags of salt while those on the right are kwacha. The plaintiff does not deny to have prepared this and according to this docu- ment the price of salt was K12.50 per bag. The defend- ant said that he had asked the plaintiff to put things in writing because in 1986 he had bought salt from the plaintiff at an agreed price of K8.00 per bag. But what later happened is that the plaintiff raised a debit note of 20t per bag. The defendant's evidence is that he refused to pay the additional 20t. This is the sort of thing that Exhibit Dl was intended to avoid. It was MF. Shabir who dealt with Mr. Rodrigues. When he saw the invoices, he told Mr. Rodriques that they were for too much because only 4,410 bags were sold. He told him to take them to the plaintiff so that they could be corrected. It was Shabir's evidence that Mr. Rodrigues did not say he wanted K56,250 by cheque and then K22,9059 cash. All he said was: "Can you pay these invoices?", When Mr. Rodriques went back the plaintiff telephoned and Shabir explained that the invoices were for too much. Then after a day or two the plaintiff went to the defendant's shop to demand payment but he had not prepared a credit note for the damaged bags nor had he amended the invoices. Shabir told him he could not pay unless the papers were put correct. Subseguently. however, the defendant paida@ through his legal practitioners. Such was the evidenge before me. Apart from the question of what was the agreed price of salt, a iot of other things were said, such as when the plaintiff had cleared his salt and at whose request the release orders were issued in those amounts. It is really within the plaintiff's knowledge as to when he cleared his salt. Mr. Osman in his submission said that I should not believe Shabir's evidence because he said the plaintiff had cleared his salt in bits when, in fact, all of it was cleared at once in February. the point taken by Mr. Osman is that Shabir lied wher he said some of the plain- tiff's salt was not cleared and since he told lies on this point, the rest of his evidence cannot be believed. I cannot agree with Mr. Osman. A careful scrutiny of this witness's evidence shows that he was not sure when the plaintiff had cleared his salt and after all it does not necessarily follow that if a witness lies on one point, then the whole of his evidence should be dis- regarded. Mr. Osman was quite entitled to attack the witness's credibility on any matter but as IT see it the question of clearing the salt and at whose instance the release orders were given in those figures are not relevant to the question of pricing. As Mr. Osman and Mr. Msisha have rightly pointed out, the question whether the agreed contract price was K17.50 or K12.50 per bag is purely a factual one. It is really whether it is the plaintiff's story that is to be believed or the defendant's. In weighing the evidence I think that regard must be had to the papers that passed between the parties. I think that the starting point should be Exhibit Dl. The plaintiff conceded that he did write this piece of paper. But Mr. Osman submits that, I should disregard it as by asking him to make such a document, Shabir was tricking the plaintiff; I do not think that Shabir was tricking the plaintiff: he was only, in my view, trying to guard himself against eventualities like this one. They say once beaten twice shy. In 1986 the plaintiff raised a Debit Note of 20t when the agreed price was K8.00 per bag. I think that it is this sort of thing that Shabir was trying to avoid. The plaintiff was recalled to explain the 1986 transac- tion. He said that the price of salt was fluctuating and K8.00 per bag was an under charge so he raised a debit note of 20t per bag. He said the defendant paid the extra 20t but this was not substantiated. I do not believe that the additional 20t per bag was paid. Reverting to the present transaction, the plain- tiff said that just about that time there was a devalua- tion and that some businessmen incurred losses as a result. I think that the plaintiff ig one of those businessmen who incurred losses. The debit note, Exhibit P9, which he raised says “addition charge on 4,500 bags at K5.00". This would seem to suggest that the K5.00 was not agreed but he just imposed it, most likely to cover up losses. It may be a question of language but the evidence does suggest that the K5.00 per bag was indeed an "additional charge". Additional to what was agreed upon. The invoices which the plaintiff raised are in total agreement with Exhibit Dl. They do not say that what was claimed thereunder was part payment. The debit note, Exhibit P9, was never shown to the defendant. He saw it for the first time in court. The plaintiff told the court that he gave Mr. Rodriques the invoices, and Exhibit P10 which showed what was to be paid by cheque and what in cash. But Mr. Rodriques only produced the invoices. He did not produce Exhibit P10. Tf he was sent to collect a cheque for K56250 and cash amounting to Sf an wena K22,050, why did he not produce Exhibit P10. The answer seems to be that this document did not exist at the time, The plaintiff said he had overlooked to send the debit note, Exhibit P9, to the defendant. I wonder why he overlooked this important matter. It is most significant that both Exhibits 9 and 10 which talked of the K5.00 per bag were never shown to the defendant. When Mr. Rodriques went to demand payment he only said pay these invoices. I very much doubt if he demanded the cash payment of K22,050,00 at K5.00 per bag because if he did that he should have produced Exhibit P10, if at all it existed at that time. When I consider all the evidence before me, the irresistible conclusion I must come to is that the agreed contract price was K12.50 per bag. I just want to comment on something. When the plaintiff was asked as to what benefit the defendant would derive from paying K12.50 by cheque, and K5.00 in cash, he said this would enable the defendant to get rid of dirty money. As I understood it, dirty money is money collected from sales which are not accounted for or not recorded. The effect of this is that there would be piles of money which do not appear anywhere in the books of accounts. The end result is that the books of accounts would show low profits when, in fact, the profits were quite high and this no doubt would affect tax assessment. I do not want to pursue this matter any further because there was no evidence that the defendant practises in dirty money or that the alleged K5.00 per bag would he paid for out of dirty money. All I can say is that businessmen who indulge in this practice cannot call themselves honest businessmen. Although I have already found that the price was K12.50 per bag, I just want to mention that the mode of payment suggested by the plain- tiff is completely against business sense and the idea of raising debit notes to cover up losses cannot be commended. This claim is therefore djsmissed. I now turn to the claim for K552.50. This claim must also fail. Ther: is no evidence to show that the defendant was informed that the plaintiff had foreign bills to pay and that he would pay these cut of the proceeds of sale of selt to the defendant. This was simply a contract of sale of salt and the rgayment of foreign bills out of tne proceeds of such sale could not be reasonably contemplated. This claim is therefore too remote ~- see the cases of Hadley v Baxenda..e (1954) 9 Exch 341 and Koufos - v - ©. Czarnikow Ltd (1969) 1 AC 350. In any case the plaintiff had contrikvited to the delay. The invoices he raised were for too much as only 4410 bags were collecteé. When the defendant requested that the invoices be aiended or a credit not2 be raised, the plaintiff did neitler of these. Instead he referred the matter to his lawye:s. This head of claim is also dismissed. 6//// In the result the plaintiff's action is dis- missed in its entirety with costs. PRONOUNCED in open court this 15th day of June, 1990. 4 df fi ome fh ifs fo Ty! ad ff * NAVAIR, M. PY Mkandawire JUDGE