Union Beverages Ltd. V. Pepsicola International Ltd & Ors (1994)

LawGlobal-Hub Lead Judgment Report

ADIO, J.S.C. 

The appellant, as plaintiff, instituted an action, in the Lagos High Court, against the 1st, 2nd and 3rd respondents, as defendants and the appellant’s claim was as follows:

“1. A declaration that the 1st defendant’s letter dated 22nd December, 1988, purporting to terminate the Exclusive Bottling Appointment Agreement dated 19th January, 1976 is invalid, wrongful, null and void and of no effect whatsoever and should in the interest of justice be set aside.

2. The plaintiff also claims from the said 1st defendant the sum of N50,000,000.00 as damages for the wrongful breach of the said Exclusive Bottling Appointment Agreement.
3. The plaintiff claims against the 2nd and 3rd defendants jointly and severally N50,000,000.00 damages for trespass to the plaintiff’s goods namely, Pepsi bottles and crates.
4. The plaintiff claims from the 2nd and 3rd defendants jointly and severally the sum of N50,000,000.00 damages for wrongful inducing a breach of the said Exclusive Bottling Appointment Agreement between the plaintiff and the 1st defendant.
5. The plaintiff claims from the 1st, 2nd and 3rd defendants jointly and severally the sum of N50,000,000.00, damages for conspiracy to injure the plaintiff in its business.
6. The plaintiff also claims against the 1st, 2nd and 3rd defendants a perpetual injunction restraining them, their servants, workmen, privies or agents or otherwise howsoever from interfering with Exclusive Bottling Appointment Agreement.”

There was an application, ex parte, for an interim injunction made by the appellant to restrain the respondents, their servants etc., from bottling, selling or distributing or taking any step towards implementing any agreement between themselves jointly or severally by which Pepsicolaor Mirinda or Teem or any other Pepsicola range of products would be bottled, sold or distributed within Lagos, Oyo, Ondo or Ogun States of Nigeria or from otherwise taking any step contrary to the interests of the appellant under the franchise Exclusive Bottling Appointment Agreement dated I9th January. 1976, and its Subsidiary Amending Agreement dated 26th June, 1985 and the Franchise Exclusive Bottling Appointment Agreement dated 1st January, 1983.

The application was supported by an affidavit in which it was deposed, inter alia, that the claim was based on the exclusive franchise agreements made between the appellant and the 1st respondent and that it was agreed under the said agreements that the appellant would have the exclusive right to bottle, sell and distribute the beverages mentioned in the said agreements within the geographical area of Lagos and Western States consisting of Lagos, Oyo, Ondo and Ogun States. It was further deposed that contrary to and in breach of the aforesaid agreements, the 1st respondent wrongfully purported to terminate the aforesaid agreements with immediate effect. It was also deposed that the intention of the 1st respondent was to grant sole franchise to the 2nd respondent and to sign franchise agreement with the 3rd respondent in relation to the beverages to which the aforesaid agreements between the appellant and the 1st respondent related.

The documents attached to the affidavit in support of the application were as follows:-

(a) Exhibit “MBOI” -Pepsi Cola Agreement -p.31,

(b) Exhibit “MB02” -Amendment of Exhibit “MBO1″ – p.16,

(c) ExhibitMB03” -Teem Agreement- p.18,

(d) Exhibit”MB04 -Notice of termination of Agreements – p.23.

It is sufficient, for the present purpose, to state that the ex parte application for interim injunction was granted by the trial court. What led to the present appeal was the refusal by the learned trial Judge to grant an application by the appellant for an interlocutory injunction against the 1st, 2nd and 3rd respondents, the terms of which were similar to the terms of the interim injunction, and the discharge by the learned trial Judge of the interim injunction earlier granted. A copy of the ruling of the learned trial Judge, on the point, is at pages 128 to 132 of the record of proceedings. Dissatisfied with the aforesaid ruling, the appellant appealed to the Court of Appeal which dismissed the appeal of the appellant. It’s judgment is at pages 214-225 of the record of proceedings.

It has to be noted, at this stage, that the affidavit in support of the application for interim injunction and the affidavit in support of the application for interlocutory injunction clearly alleged that the relevant agreements relating to the aforesaid franchise allegedly granted to the appellant were between the appellant and the 1st respondent and that it was the 1st respondent that purported to terminate the agreements in question. Indeed, the 4th respondent was not made a party to this action until after the application for the interlocutory injunction had been refused and the interim injunction earlier granted was discharged. The foregoing was obvious from the heading of the relevant ruling of the learned trial Judge dated 10th March, 1989. The respondents before the learned trial Judge, on that date, were the 1st, 2nd and 3rd respondents. The 4th respondent had not become a party in the case.

The Court of Appeal held, inter alia that though the appellant’s claim was based on the alleged franchise agreements between itself and the 1st respondent, the aforesaid agreements did not show any nexus between the appellant and the 1st respondent. The court then examined the point whether there was any serious question to be tried between the appellant and the 1st respondent and came to the conclusion that there was none.

Dissatisfied with the judgment of the Court of Appeal, the appellant has appealed to this court. In accordance with the rules of this court, the parties filed and duly exchanged briefs. The three issues set down in the appellant’s brief are sufficient for the determination of this appeal. The three issues, which were based on the grounds of appeal, are as follows: