National Electric Power Authority V. R. O. Alli & Anor. (1992)
LawGlobal-Hub Lead Judgment Report
O. OGWUEGBU, J.S.C.
The plaintiffs claim against the defendant is as follows:
”The 2nd plaintiff by an agreement dated 6th September, 1977, sold the machines and machineries listed in paragraph 6 above to the 1st plaintiff upon terms that the 1st plaintiff having paid N15,000.00 to the 2nd plaintiff the aforesaid machines were assigned and delivered to the 1st plaintiff subject to the 1st plaintiff paying to the 2nd plaintiff the balance of N45,000.00 plus interest thereon at the rate of 12% from 6th September, 1977.
The machines supplied and delivered to the 1st plaintiff by the 2nd plaintiff listed in paragraph 6 of the further amended statement of claim were:
- Long Saw Machine, Model ST 110
- Band Saw Sharpener, Model CITV25,KS
- Tensioning Machine
- Extra Blades and Spare Parts.
After the purchase and delivery of the above machines, the 1st plaintiff established and installed an ultra modem Sawmill Factory at the Industrial Area. Irewon Road, Ijebu-Ode in Ogun State.
The defendant is a statutory authority set up under and by virtue of the National Electricity Act for the following purposes:
(a) to generate or acquire supply of electricity,
(b) to provide bulk supply of electricity for distribution within and outside Nigeria and
(c) to provide supply of electricity for consumers in Nigeria. It supplied electricity to the factory of the 1st plaintiff.
On 12th-February, 1980, the defendant’s transformer at Ijebu-Ode due to its negligence went into flames. The fire from the transformer spread to the 1st plaintiff’s factory and destroyed all the machines and machineries.
Wherefore the plaintiffs jointly and severally claim from the defendant as follows:
“A Special Damages:
(i) Damages being cost of replacing the machines listed above
which were completely destroyed N80,000.00
(ii) Damages for payment of rent on lease of factory site at
N1,600.00 per annum from 12:2: 80 – 11:2:83 N4,800.00
(iii) Damages for payment of wages for skilled staff who could
not (sic) laid (sic) at N9.360 per annum from12:2:80 to 11:2:83 .. N28.000.00
(iv) Loss of income from 12:2:80 up to 11:2:83 N201,600.00
N314,400.00
B. From the award of damages that may be adjudged due to the 1st plaintiff the 2nd plaintiff claims N45,000.00 plus interest at the rate of 12% from February, 1980 until payment of it.
C. In the alternative the 1st and 2nd plaintiffs claim that the Defendant, its agents or servants are liable in the sum of N314,480 for breach of its statutory duty on 12th February, 1980, by not complying with Section 7 of Electrical Supply Regulations Cap. 37 of 1958.
D. Interest at the rate of 5% on N314,480 from 3/8/82 till the date of judgment.
E. Interest at the rate of 10% on the judgment debt from the date of judgment until payment of the judgment debt:’
Pleadings were filed and exchanged and trial started on the further amended statements of claim and defence. At the conclusion of the hearing and the addresses of both learned counsel, the learned trial Judge, Delano, J. in a reserved judgment found as follows at page 94 lines 1 to 23 of the record:
“From the above, all the items of claim fail except the following:
(i) Item A(i) where the claims of N80,000.00 special damage succeeds.
(ii) Item A(iv) where the 1st plaintiff is awarded the following general damages:
a. N2,400.00 for salaries paid to his workers:
b. N12,000.00 for profit he could have earned.
(iii) Items 8, D and E partially succeed.
In respect of item D, interest will be at the rate 5% on N94,400.00 from August 3rd 1982 to January 10th 1985 which is two years. 5 months and eight days. On calculation, the interest is 11,43934, the total damage therefore becomes N105,839.34. In respect of item E, it is ordered that interest should be calculated at the rate of 10% on the day of payment of judgment debt. Finally, judgment is given in favour of the plaintiffs in the sum of one hundred and five thousand, eight hundred and thirty nine naira, thirty four kobo (105,839.34) as against the defendant. The 2nd plaintiff is entitled to 12% of N45,000.00 from February 1980 to January 10th, 1985 which is about N72,000.00 out of N105,839.34, the 2nd plaintiff is entitled to N72.000.00.”
Both parties were dissatisfied with the decision and each appealed to the Court of Appeal against parts of the judgment.
The defendant complained about the findings on its liability and damages. The 1st plaintiff cross-appealed and his complaint was that the learned trial Judge failed to award him the claim for loss of income.
The Court of Appeal, Ibadan Division in its judgment dated 3rd March. 1987 dismissed the defendant’s appeal and allowed the plaintiff’s cross-appeal. That court found as follows at page 174 lines 17 to 29 of the record of appeal:
“As the learned trial Judge has failed to consider the evidence on loss of income before him and to evaluate it, this court is in as much the same position as the High Court to do so. In so doing, I consider that taking the lowest figure of N240.00 a calculation of the figure (on a monthly rate for 30 days (apart from Sundays) to be arrived at will slightly exceed N5,600.00. An award of the amount of N5,600.00 would therefore have met the ends of justice. On the item, I award N5,600.00.
In sum and for the foregoing reasons, the appeal fails in its entirety and is dismissed. The cross appeal is allowed.
The judgment of the High Court is hereby varied by the addition of 5,600.00 for loss of income to the sum of N105,839.34 awarded by the High Court to make a total of N111,439.34K………”
Both parties were again not satisfied with the decision of the Court of Appeal, The defendant on 2nd June, 1987 obtained the leave of the Court of Appeal to appeal on grounds of fact, mixed law and facts.
The grounds of appeal are:
“1. The learned Justices of the Court of Appeal erred in fact and therefore wrongly dismissed the appeal when on the record the learned trial Judge had no credible consistent evidence to base his conclusion as to the market value of the machine and himself note that there were contradictions on this aspect of the matter.
2 The learned Justices of the Court of Appeal erred in fact and misdirected themselves and therefore wrongly dismissed the appeal when they failed to hold that the contradictions in the evidence as to the purchase price of the machines rendered the evidence unreliable and therefore ought to have been discountenanced by the trial Judge.
ERROR IN LAW
3 The learned Justices of the Court of Appeal erred in law and therefore wrongly dismissed the appeal when they did not hold that the fact that the defendant/appellant did not offer any alternative market value for the machines did not reduce the burden on the plaintiffs/respondents of strict proof of the market value of the machines an item of special damages, which burden plaintiffs did not discharge.
PARTICULARS
The Court of Appeal in the judgment of Omololu-Thomas J.C.A, in holding that once the burden of proving the worth of the machines is established the onus shifts on the defendants when –
a. the burden of proof in this case of special damages was that of strict proof:
b. it never shifts to the defendant.
- The learned Justices of the Court of Appeal erred in fact and therefore wrongly dismissed the appeal when they discountenanced the complaint of defendant/respondent that 4th P.W. was treated as an expert witness whose evidence was crucial to the trial Judge’s finding of fact when on the record there was no justification for according 4 P.W. such a status thus giving great weight to his evidence.
ERROR IN LAW
- The learned Justices of the Court of Appeal erred in law find in fact and therefore wrongly dismissed the appeal when they failed to hold that when the trial Judge accepted and awarded the figure of N80.000.00 he was awarding a figure for the destroyed machines as new, when he should have accounted for depreciation, thus restoring the plaintiff to the position he was before the incident that destroyed the machine.
PARTICULARS
(a) The Court of Appeal erred in law in holding that it is not in every case that depreciation should be accounted for in quantifying the pre-accident value or the market value of a lost or destroyed item. Their Lordships also erred in fact in holding that when the trial Judge accepted the evidence of P.W. 4 that the machine was worth N80,000.00 he was not only returning to its market value but also the lowest worth of such value/machine, when P.W. 4 had given no such indication in his evidence so that their Lordships’ conclusion that the trial Judge did not award the value of the machine as new was wrong.”
The 1st plaintiff cross-appealed against that part of the decision dealing with the assessment of damages for loss of income to the appellant.
The ground of appeal reads:
“1. The Court of Appeal erred in law by failing to apply either correctly or at all the law of restitution in integrum to the proved and established facts before it which failure led to the award of damages which was manifestly roo low and thereby occasioned a miscarriage of justice.
PARTICULARS
- The principle applicable to the assessment of damages for tort is restitutio in integrum which the Court of Appeal failed to apply to the facts of this case before making its award.”
The defendant/appellant identified six issues for determination by this court:
“1. Whether the principle of Res Ipsa Loquitur was applicable in this case when the cause of the res, a sudden upsurge of electricity, has been identified as due to a fault in the N.E.P.A. transformer and the facts are equally consistent with accident as with negligence.
- Whether the learned trial Judge and the learned Justices of the Court of Appeal were right in failing to hold that the installation of the circuit breaker (which had not been found faulty) by NEPA in the plaintiff/respondent’s premises had neutralized the presumption of negligence which the circumstances of the occurrence might have raised against the Defendant/Appellant.
- Whether there was consistent and credible evidence as to the market value and purchase price of the machines to justify the findings of the learned trial Judge which the Court of Appeal upheld.
- Whether the failure of the defendant/appellant to adduce evidence as to an alternative market value of the machines reduced the burden on the Plaintiffs/Respondents of strict proof of that item of their claim on special damages.
- Whether the Court of Appeal was right in failing to seriously consider the undue weight placed by the learned trial Judge on the evidence of 4th P.W. who was erroneously regarded as an expert witness.
- Whether the Court of Appeal was right in failing to set aside the award of N80.000.00 special damages as the market value of the goods as new without consideration of the machines which had been used for one year.”
The only issue submitted by the 1st plaintiff cross-appellant for determination in the appeal by the defendant is:
“In a case of special damages requiring strict proof, is it the law that the burden of proof never shifts to the defendant”
In his cross-appeal, the plaintiff identified one issue for determination, namely,
“Whether having regard to the evidence and upon a proper application of the principle of restitution in integrum. N5,600.00 was an adequate compensation in the circumstances for loss of income.”
On its part the defendant/respondent in the cross-appeal identified one single issue as arising for determination:
“Whether the Court of Appeal applied correctly or at all the principle of restitution in integrum in the award of the sum of N5,600.00 as special damages for loss of income to the plaintiff having regard to the proved and established facts.”
In this judgment, the defendant will be referred to as the appellant while the 1st plaintiff will be referred to as the cross-appellant.
The appellant filed his brief of argument and the respondent’s brief to the cross-appeal on 14th May and 26th October, 1990 respectively. The cross-appellant filed the respondent’s brief to the appellant’s appeal and the brief to his cross-appeal on 22:2:91 and 27:8:90.
The appellant at page 7 of his brief of argument indicated that he would seek leave of this court to raise the issue of the applicability of the principle of Res Ipsa Loquitur as it involved a substantial issue of law and no fresh evidence would be needed to consider it. True enough, the appellant indicated his intention to seek leave to raise the point. He did not ask for the said leave at the hearing of the appeal and none was granted. In the circumstances, all argument in the brief in respect of the principle of res ipsa loquitur raised in issue (1) go to no issue and will not be considered by me in this judgment.
On issue two, the learned counsel farlhe appellant submitted that through the cross-examination of P.W.2 (Dele Otukoya), the appellant had led sufficient evidence to rebut the presumption of negligence. He referred to the evidence of P.W.2 at page 58 of the record of appeal (third paragraph) where the witness stated:
“What NEPA requires in any industrial premises is to instal a protective device which in this case is a fuse whose function is (to) disconnect electricity (to) in the installation of the customer if there is electrical fault. It is NEPA which insitalls the device that disconnect (sic) NEPA supply from consumer installation when there is an abnormal voltage or current…….. The plaintiff’s sawmill has a circuit breaker.”
Counsel submitted that on the above evidence taken along with an earlier evidence of (the same witness to the effect that the fault must be from the source of electricity in this case the transformer, the learned trial Judge should have found that the appellant had taken sufficient care to prevent even damage due to the alleged sudden upsurge of electricity by installing a circuit breaker in the factor).
In paragraph 7(a) of the further amended statement of claim, the respondent averred:
“On the said 12th February, 1980, Ijebu-Ode township experienced an upsurge of excessive power supply when more than required amount of voltage for domestic and industrial consumption penetrated into houses and industrial projects in Ijebu-Ode, Ikenne, Iperu, Ijebu-Igbo and caused considerable damage to electrical projects at Ijebu-Ode and the other towns.” The appellant in paragraph 1 of its further amended statement of defence merely denied paragraph 7(a) along with some other paragraphs and put the cross-appellant to the strictest proof. It further denied any negligence, breach of any statutory duty and that it was an accident over which it had no control.
In his evidence, the 1st plaintiff who testified as P.W.1 at page 45 lines 17 to 29 stated:
“I know the defendant. NEPA supplied electricity to the Industry. Before the supply, they tested the electric installation on the site to make sure they are not faulty.
On February, 12th 1980, at about 4.30 p.m. after the close of business for the day, I and Buari were on the site. We were sitting (sic) in the store. As we got down, we saw the fluorescent light in the sawmill on very bright and they started to explode. These was a sudden upsurge of current in the sawmill. We ran out to the street. As I looked back at the sawmill, I saw that it is on fire. Then I was on the street. I also saw an explosion in the NEPA office. People started to run here and there. The NEPA office with everything inside including the electric wire were burnt………….After then I went to the NEPA office. I reported the fault of NEPA.”
In answer to his cross-examination the witness at page 47 lines 5-9 said:
“NEPA issue a Certificate after inspection of the installation with NEPA before connection of electricity to the house. I have a certificate from NEPA after inspection. I have no automatic switch off equipment attached to my switch.”
In answer to cross-examination, P.W.2 stated at page 56 lines 28-29 of the record:
“I observed that the sawmill got burnt as a result of an electrical fault.”
At page 57 lines 3-9 the witness stated:
“From what the 1st plaintiff told me about the issue of the fire and my observation at the scene at (sic) my view that an electrical fault of such magnitude could not be internal fault but an external fault. Such external fault could only be caused by lack of maintenance of electrical equipment owned by NEPA. The fault must be from the source of electricity in this case from the NEPA transformer.”
This witness further stated under cross-examination that it is NEPA that instals protective device. that disconnect NEPA supply from consumer installation when there is abnormal voltage or current and that the cross-appellant’s sawmill has a circuit breaker.
The trial Judge among other things found that the source from which the “res” emanated was in the management of the defendant who must provide evidence that the high voltage was not due to want of care on its part. He further stated that the defendants did not lead any evidence to disprove negligence on their part.
The appellant led no evidence at all to show that the upsurge of electricity which caused the extensive damages to private and industrial premises in Ijebu-Ode and environs was as a result of accident as it claimed in its statement of claim. The cross-examination by the appellant as to the cause of the fire incident was feeble if at all.
The appellant generates electricity, provides bulk supply of same for distribution and provides supply of electricity to consumers in Nigeria. It is my view that electricity is a very dangerous thing being handled and carried by the appellant. If it should escape, it owed a duty to the consumers to exercise reasonable care and skill that the consumers should not be damaged. The degree of care which that duty involved must be proportioned to the degree of risk involved. See Northwestern Utilities Ltd v. London Guarantee And Accident Co. Ltd. & Ors. (1936) A.C. 108 at 118 and Collingwood v. Home and Colonial Stores (1936) 1 All E.R. 74.
Having considered all the circumstances, I am satisfied that negligence on the part of the appellant was proved and this is a proper case where the rule in Rylands v. Fletcher (1868) L.R. 1 Exch. 265 should apply fully.
On the issue of damages, it was the submission of the learned counsel for the appellant that there was no consistent and credible evidence as to (a) the market value at the relevant point in time (emphasis by counsel) and (b) the purchase price of the machines to justify the decision of the Court of Appeal that the figure of N80,000.00 could be said to be the market price of the machines destroyed.
Counsel referred to the evidence of P.W.4 (Mr. Richard O. Odusote) who I testified on 1:11:84 when the incident took place on 12:2:80. He submitted that the witness was clearly testifying as to the probable cost of the machines as at November, 1984. He further stated that neither this witness nor any other witness gave evidence as to the market value of the machines as at the time of the incident and that the Court of Appeal relied on the case of Shodipo v. Daily Times (1972) 11 S.C. 69 at 76-77 to uphold the decision of the learned trial Judge in holding that the amount awarded was not shown to be inordinately high or low. He stated that the principle applicable in assessment of damages in the circumstances of this case is founded on the principle of restitution in integrum.
He said that in cases where chattels were destroyed by wrongful act of a defendant, the measure of damages is the value of the goods at the time of the destruction.
Learned counsel for the appellant also submitted that there was no evidence at all as to the value of the machines at the time of destruction and that the learned trial Judge applied the wrong principle. He said that the Court of Appeal was in serious error in failing to set aside the Judge” s acceptance of irrelevant evidence in determining the market value of the machines. In the circumstance, he argued, the findings of the Court of Appeal are wrong and the authorities relied upon by the court are inapplicable. namely, Imana v. Robinson (1979) 3-4 S.C. 1, Odulaja v. Haddad (1975)11 S.C. 357 and Omoregbe v. Lawanl (1980) 3-4 SC. 108.
Learned appellant’s counsel also complained about the evidence of P.W.4 being treated as that of an expert by the trial court and that the witness did not qualify as an expert on the evidence before the court within the meaning of Section 56 of the Evidence Act.
Learned counsel for the cross-appellant contended that the decision of the Court of Appeal cannot be faulted and that it is supported by authorities. He disagreed with the contention of the learned counsel for the appellant that in cases involving special damages, the burden never shifts and that this runs counter to the provisions of Section 136(1) and (2) of the Evidence Act.
The claims for the machines destroyed were items of special damage which are required to be proved strictly but strict proof of special damage means no more than such proof as would readily lend itself to quantification. The nature of proof in a given case must be dictated by the peculiar circumstances of the available evidence. See Odulaja v. Haddad (1973) 1 All N.L.R. (Pt.11) 191 at 196 and Incar Nigeria Ltd. v. Adegboye (1985) 2 N.W.L.R. (Pt.8) 453.
In addition, the character of the acts themselves which produce the damage and the circumstances under which these acts are done, regulate the degree of certainty and particularity with which the damage ought to be proved. See Rarchffe v. Evans (1892)2 Q.B. 524.
In the appeal before us, the cross-appellant in his further amended Statement of claim averred that he paid N15,000.00 to the 2nd plaintiff for the machines subject to his paying the balance of N45.000.00 to the 2nd plaintiff plus interest thereon at 12% per annum with effect from 6:9:77. In answer to cross-examination, the cross-appellant stated:
“The cost of replacing the machines now is N80.000.00”
P.W.4 stated in examination-in-chief at page 55 lines 20-22 and 30-33:
“We still sell sawmill and services of [the machines. The machines sold to the plaintiff will not cost less than N80.000.00 (eighty thousand naira) now……Even after using the machine for about one year, the price would he worth N80.000.00 because when we sold it, we sold to advertise but by 1980,the second hand value of the machine was worth N80.000.00” (the italics are for emphasis only).
At pages 73 and 74 of the record of appeal, the purchase price of the machines was given as N48,077.77 and N58,777.77 in Exhibits “G” and “H”.
In the famous case of Liesbosch Dredger v. S.S. Edison (1933) A.C. 449, the plaintiffs’ dredger which was sunk by the defendant was employed by the owners in the normal course of their business as civil engineers. While the dredger Liesbosch was lying moored alongside the breakwater at Patras Harbour in the Hellenic Republic, the steamship Eddison fouled the dredger’s moorings and carried her out to sea, where she sank and was lost. The owners of the Eddison admitted liability.
In an action brought by the owners of the Liesbosch, the House of Lords held that the measure of damages was the value of the Liesbosch to her owners as a profit-earning dredger at the time and place of her loss; and that it should include:
(1) A capital sum made up of (a) the market price on November 26, 1928 when it was sunk of a dredger comparable to Liesbosch; (b) the cost of adapting the new dredger and of transporting and insuring her moorings to Patras; and (c) compensation for disturbance and loss suffered by the owners of the Liesbosch in carrying out their contract…………including in that loss such items as overhead charges and expenses of staff and equipment and the like thrown away but neglecting any special loss or extra expense due to the financial position of the parties.
(2) Interest upon the capital sum from November 26, 1928.
The above statement of the law should apply here.
The machines of the cross-appellant were totally destroyed. The measure of damages therefore is the value of the machines at the time of the accident plus such further sum as would compensate the cross-appellant for the loss of earnings or income together with interest upon the capital sum from the date of destruction.
The cross-appellant is entitled to what is called restitutio in integrum, which means that he should recover such sum as will replace him so far as can be done by compensation in money, in the same position as if the loss had not been inflicted on him.
Where there is a total destruction of a chattel as in this case, damages to be awarded need not be based on the value of the chattels at the time of destruction. Used equipments could be sold for more than their purchase price. See Moore v. DER Ltd. (1971) 1 W.L.R. 1476.
However, the courts below not having based their award on the value of the machines at the time of destruction, the appeal partially succeeds.
It is therefore ordered that the case be remitted to the trial court with a direction to assess the appropriate damages in respect of the machines based on the evidence before it.
As to the cross-appeal, the cross-appellant testified that his daily income is between N310.00 and N240.00 excluding Sundays. Under cross-examination, he said:
“I am not sure of N1,000.00 monthly. This is so because I am an illiterate.”
There is no doubt that the cross-appellant suffered loss of income. The Court of Appeal was clearly in error to have awarded the sum of N5,600.00 as damages for one month. The cross-appellant supplied the evidence of his daily income. This evidence was not controverted. One wonders why the trial Judge disallowed this item of special damage and the Court of Appeal awarding damages for one month only. No reasons were given by the Court of Appeal for doing this.
I therefore allow (the cross-appeal and also remit the case to the trial court to assess the loss of income at the rate of N240.00 per annum from 12:2:80 to 11:2:83. I assess the costs of both appeals at N1,000.00 in favour of the appellant against the plaintiff/cross-appellant and N1,000.00 in favour of the cross-appellant and against the defendant/appellant/respondent.
SC.12/1990
