K. Chellaram & Sons (Sierra Leone) Ltd. V. Najib Abdallah (1954)

Contract—Agent—Undisclosed principal.
Tort—Conversion ofgoods.
Appeals in Civil cases—Finding made by Court of Appeal in absence of a finding in the judgment of the Court below.

Facts

One L, who owed money to the defendants, had an arrangement with them whereby for groundnuts he sent them half the value would be paid for in cash, and the balance would be paid at re-weighing.

According to L’s evidence, the plaintiff asked L to send groundnuts for him to defendants on the like terms. L also testified that he then wrote to defendants* manager, who did not answer, and after a time began sending them plaintiff’s groundnuts.

There was trouble in the end and plaintiff (above respondent) sued the defendants, alleging that he sold them so many bags through their agent L, that he received so much on account, that later he demanded the balance of money or of nuts but defendants repudiated the dealing on the ground that the nuts were the property of L; plaintiff claimed in the alternative damages for conversion of the nuts and bags. The defendants (above appellants) denied that L was their agent and denied privity of contract between them and the plaintiff; they alleged that they bought from L, to whom they had accounted.

The trial Judge held on the evidence that L was agent of the plaintiff but not of the defendants and that the contract was between the plaintiff and L personally, but held also that the defendants having received the groundnuts and denied plaintiff’s title, were guilty of converting the goods and liable to him. The defendants appealed. (Be it noted that the trial Judge, though quoting it in his judgment, made no finding on L’s evidence that before sending the groundnuts he wrote to defendants’ agent telling them of the arrangement with the plaintiff.)

Held

(1) The groundnuts were sold to the defendants on credit terms and became their property, whether L was selling as principal or as plaintiff’s agent; therefore they could not be said to be guilty of converting their own property.

(2) Whoever the seller was, the bags were to remain his property and to be returned to him; therefore the defendants could be found guilty of converting them if they denied the title of the rightful owner.

(3) If defendants had no notice that they were dealing with L as an agent they would be entitled to set off his debt against the balance owing by them on the nuts, but L, their own witness, whom they did not treat as hostile at the trial, said that before sending the nuts he had written to them telling them of the arrangement with the plaintiff, and the Court of Appeal would, in the absence of a finding by the trial Judge on the point, make a finding that defendants knew L was anting as plaintiff’s agent and therefore could not set off L’s debt against the balance owing to the plaintiff.

Appeal dismissed; judgment for the respondent-plaintiff.