Patmose Technical Services (K) Limited v Rural Electrification Authority [2020] KEHC 654 (KLR) | Sale Of Goods | Esheria

Patmose Technical Services (K) Limited v Rural Electrification Authority [2020] KEHC 654 (KLR)

Full Case Text

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT NAIROBI

COMMERCIAL & TAX DIVISION

COMMERCIAL CASE NO. 475 OF 2012

PATMOSE TECHNICAL SERVICES (K) LIMITED..PLAINTIFF

VERSUS

RURAL ELECTRIFICATION AUTHORITY ..........DEFENDANT

JUDGMENT

1. PATMOSE TECHNICAL SERVICES (K) LIMITED the Plaintiff herein instituted this suit by way of the Plaint dated 13th July 2012.  In their Plaint the Plaintiffs sought for Judgment for:-

1. USD 199,172. 87 being the value of ACSR conductors supplied;

2. Interest on (1) above at the commercial rate of 18% per annum from 8th August 2010; a month from the date of delivery note until payment in full.

3. Cost of the suit together with the interest thereon at Court rates from the date of filing this suit until payment in full.

4. Any other or further relief (s) as this Honourable Court may deem proper to grant.

2. The Respondent RURAL ELECTRIFICATION AUTHORITY filed a Defence dated 15th August 2012 praying that the Plaintiffs suit be dismissed on its entirety and that costs be awarded to the Defendant.  The hearing of this suit commenced way back on 19th September 2014 before Hon. Lady Justice Jackie Kamau who heard the evidence of all the five (5) witnesses for the Plaintiff.  Thereafter I took over conduct of the matter on 14th March 2019 and heard the evidence for the Defence.

THE EVIDENCE

3. PW1 SAMEET PATEL, was the Sales and Marketing Director of the Plaintiff, a limited liability company carrying out the business of supplying electrical materials especially conductors, cables, stay wires and binding wires within the Republic of Kenya.  PW1 relied on his written statement dated 13th July 2012.  PW1 told the Court that on or about February 2010 the Plaintiff supplied to the Defendant at their yard in Embakasi under LPO Number ******** 192 drums (equivalent to 444,100 metres) of Aluminium Conductors Steel Reinforced (ACSR)cables.  Upon delivery it was realized that the ACSRwas in excess of the amount indicated in the LPO by 198,958 metres.

4. PW1 states that officers of the Defendant who were present at the yard specifically one Mr. Joel Omusebe the Defendants Senior Procurement Officer, pleaded with the Plaintiffs Officers to offload the excess of 198,958 metres as there was at the time a low supply of ACSR conductors in the market and the Defendant was facing shortages of the products.  The said Mr. Joel Omusebe informed the Plaintiff that an LPO for the excess supply would be forwarded to the Plaintiff in due course.  Given the longstanding cordial business relationship that existed between itself and the Defendant the Plaintiff accepted to offload the excess supply of ACSR which was duly received by the Defendants Officers at the site.

5. Later the Plaintiff received another LPO Number **** from the Defendant and raised a delivery note No. 1783 dated 7th July 2010 for the supply of 198,958 metres of ACSR which had been supplied to the Defendant in February 2010.  However the Defendant declined to sign the delivery note for the supply of the extra 198,958 metres and further failed and/or declined to remit to the Plaintiff the sum of USD 199,172. 87 being payment for the same.  The Plaintiff then filed the present suit.

6. PW2 JOSHUA MUTISO was employed by the Defendant as a store keeper and states that in the year 2010 he was based at the defendants Embakasi yard.  PW2 states that whereas he did not witness the actual delivery of the ACSR at the Embakasi yard he did peruse the paperwork which indicated that an excess of the material was delivered.  PW2 also states that one Teddy Odhiambo who was his supervisor confirmed that the excess supply of Kshs. 198,958 metres was delivered and signed for the same.

7. PW3 ALI ABDI told the Court that at the material time he worked for the Defendant as a store-keeper whose duty was to receive materials, maintain documentation and ensure the safe custody of supplies and to issue out the same only to authorized users.  PW3 states that on 10th February 2010, the Plaintiff delivered cable conductors at the Defendants Embakasi yard.  PW3 states that one JOSHUA MUTISO brought him the offloading schedule and summary indicating that an excess supply of 198,958 metres was delivered.  PW3 states that he had no reason to doubt the information given to him by ‘Mutiso’.

8. PW4 MICHAEL NDOLO MUTUA is a Factory Manager employed by the Plaintiff.  PW4 relied on his written statement dated 13th July 2012.  He told the Court that between 26th January 2010 and 2nd February 2010, he and his colleagues delivered at the Defendants Embakasi yard 192drums of ACSR cables in fulfillment of LPO No. *****.  PW4 state that after delivering the required 441,000 metres ACSR as per the said LPO, an excess of 198,958 metres remained.  He states that he called and spoke to one Mr. Joel Omusebe the Defendants Procurement Officer who told him to offload the excess supply of ACSR as the Defendant was at the time facing shortages of the conductors. PW4 complied with the request of Mr. Omusebe and offloaded the excess with the promise that an LPO to cover this extra supply would be forwarded to the Plaintiff later.  PW4 states that the offloading was done in the presence of Mr. Musyoka and Mr. Ndolo both representatives of the Defendant.

9. PW5 JONATHAN NZIVO told the Court that he worked with the Plaintiff as an incharge of stores.  PW5 confirms that between 26th January 2010 and 2nd February 2010 he and his colleagues delivered to the Defendants yard in Embakasi ACSRconductors in satisfaction of an LPO No. *****.  PW5 states that though the LPO was for 441,000 metres of ACSR, there remained an excess of 198,958 metres.  That his colleague Mr. Ndolo (PW4) called and spoke to Mr. Joel Omusebe an Officer of the Defendant who instructed them to offload the excess 198,958 metres of ACSR and promised that the Defendant would issue the Plaintiffs with another LPO to cover this excess supply. This marked the close of the Plaintiffs case.

10. The Defendant called one witness in support of its case.  DW1 WILFRED ODUOR was the Head of Procurement at the Rural Electrification Authority at the material time.  PW1 told the Court that he was not personally present at the Defendants yard when the delivery of theACSR cables was made by the Defendant as his offices were based at Chancery House along Valley Road in Nairobi. DW1 stated that one of the Defendants Officers Mr. Ted Odhiambo oversaw the offloading of the ACSRby the Plaintiff.  DW1 categorically denies that any excess supply of ACSR was offloaded.  He denies that any request was made to the Plaintiffs to offload the excess cable conductor and vehemently denies that the Defendant was in need of that excess supply due to a shortage in the market.  As such PW1 asserts that the defendant does not owe the Plaintiff any money for this alleged supply of 195,958 metres ACSR cable conductors.

11. Upon the close of evidence both parties were invited to file their written submissions.  The Plaintiff filed its written submissions dated 29th May 2020.  Whilst the Defendant filed its submissions dated 2nd July 2020.

ANALYSIS AND DETERMINATION

12. I have carefully considered the evidence adduced in this case the written submissions as well as the relevant law.  The issue which arises in this case whether the Plaintiff has proved its case on a balance of probability.

13. It is trite law that he who alleges must prove.  In Civil cases this means that any party seeking to rely on the existence of a set of facts must prove that those facts exist.  This is what is known in law as the “Burden of Proof”and is encapsulated in Section 107 of the Evidence Act, Cap 80 Laws of Kenya which provides as follows:-

“107 Burden of Proof

1. Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist.

2. When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person.”

14. In the case of GICHINGA KIBUTHA –VS- CAROLINE NDUKU [2018]eKLR the Court stated:-

“It is therefore, settled law that in Civil cases, a party who wishes the Court to give a Judgment or to declare any legal right dependent on a particular fact or sets of facts, that party has a legal obligation to provide evidence that will best facilitate the proof of the existence of those facts.  The party must present to the court all the evidence reasonably available on a litigated factual issue.”

15. The Sale of Goods Act, Cap 31, Laws of Kenya defines the terms “delivery” and “acceptance” and sets out that legal implication.  Section 2(1) defines the term “delivery” as follows:-

“Delivery” means voluntary transfer of possession from one person to another.  Further Section 36 of the same Act defines “Acceptance” as follows:-

“36 Acceptance

The buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted them or when the goods have been delivered to him, and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them.”

16. Therefore in cases where goods are delivered and are accepted and retained by the consignee, where that possession is inconsistent with the ownership of the said goods by the seller, if the goods are not declined and/or returned, then the consignee is deemed to have ‘accepted’ said goods.  The Defendants position is that it did not order the extra 198,958 metres of cable conductor nor did it accept or retain possession of the same.  As such the Defendant states that it cannot be ordered to pay for goods which they neither received nor used.

17. It is not in dispute that the Plaintiff was a supplier of ASCR cable conductors to the Defendant.  Neither is there any contention that the Defendant had issued the LPO No. ***** seeking delivery of 444,100 metres ACSR. The crucial question here is whether the Plaintiff infact delivered and the Defendant accepted the excess 198,958 metres of ACSR.

18. PW1 told the Court that the Defendant through one of their employees requested the Plaintiff to offload the extra 198,958 metres of ACSR promising that an LPO to cover this delivery would soon follow.  This evidence is supported by PW4 and PW5 both employees of Plaintiff of who testified that they delivered the actual consignment to the Defendants yard at Embakasi.  PW4 told that Court that he called and spoke to a Mr. Joel Omusebe the Senior Procurement Officer of the Defendant who instructed that the excess ACSR cable be offloaded.  PW4 told the Court that the delivery was witnessed by employees of the Defendant.  At page 12 of the Plaintiff’s Bundle of Documents file don 12th June 2012 is a hand written note which read as follows:-

“NB

Supplied in excess

198,958

Dated 10-2-2010. ”

This endorsement is only signed.  PW2 Joshua Mutiso an employee of the Defendant confirms that he recognizes the signatures of his colleagues ‘Ted Odhiambo’ and ‘Abdi Ali’ (PW3) on the delivery documents.  On his part PW3 told the Court that this excess delivery was never returned to the Plaintiff.

19. The said Mr. Joel Omusebe did not testify in this case to confirm or deny the claims made by PW1.  Mr. Omusebe was an employee of the defendant at the material time.  It is the Defendant who would have been best placed to trace and avail this person to testify in this matter.  The fact that the Defendant did not avail this witness leads to the presumption that his evidence may have been adverse to the Defendants case.  That is why the Defendants did not bother to call him in order to deny the claims made by PW1.

20. PW2 and PW3 were both employees of the Defendant at the material time.  Both witnesses supported the evidence of the Plaintiff with respect to the delivery in question.  PW2 told the Court that the ACSR conductors were delivered at the Defendants yard and states that the entire consignment was received by one Ted Odhiambo the clerk in charge of the Embakasi yard.  PW2 states that although he did not himself witness the delivery, he subsequently received the relevant paperwork from Mr. Ted Odhiambo.  That the said Ted Odhiambo informed PW2that he had been verbally instructed by Mr. Joel Omusebe from the Plaintiffs Head office to offload the remaining 198,958metres of ACSR conductor due to the market shortage of the commodity.  PW2 confirmed that he signed the offloading schedule sheet when the same was brought to him by Ted Odhiambo thereby effectively confirming delivery of the extra 198,958 metres of cable.

21. PW3 who was also an employee of the Defendant told the Court that he signed the relevant offloading schedule confirming that an excess delivery of conductors being 198,958metres was made at the Defendants Embakasi yard (see page6 and 12 of Plaintiffs bundle filed on 3rd July 2012).

22. Once again the Court takes note that this Mr. Ted Odhiambo who at the material time was an employee of the Defendant was not availed as a witness in this case.  This was a crucial witness as it was he who actually received the delivery of ACSR at the Defendants Embakasi yard.  The failure by the Defendants to call this person as a witness is very telling.  The Court is at liberty to conclude that the Defendant deliberately omitted Mr. Ted Odhiambo as a witness because his evidence would have been adverse to the Defendants case.

23. From the testimony of the Plaintiffs witnesses I am satisfied that the Plaintiff did indeed deliver to the Defendant an extra 198,958 metres of ACSR cable conductors.  This extra supply of ACSR was duly acknowledged by the employees of the Defendant (see page 12 of Plaintiffs bundles).  Further PW2 and PW3 both employees of the Defendant confirmed having signed the document thereby acknowledging receipt by the Defendant of the excess 198,958 metres of ASCR.    I am satisfied further that the Defendant did not reject or return this extra consignment but actually retained possession of the same.

24. The Defendant having accepted and retained the extra supply of ACSR cable is liable to pay for the same.  I find that the Plaintiff has proved its claim on a balance of probability.  Accordingly the Plaintiffs suit succeeds and I enter Judgment in favour of the Plaintiff against the Defendant for:-

i. USD 199,172. 87 being the value of ACSR conductors supplied.

ii. Interest on the sum awarded in (i) above at Court rates from the 8th August 2010 the date of the delivery note until payment in full.

iii. Costs of this suit as well as interest thereon at Court rates from the date of filing of the suit until payment in full.

It is so ordered.

Dated in Nairobi this 21ST day of DECEMBER,  2020.

………………………………..

MAUREEN A. ODERO

JUDGE