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Court adjourns trial of Chinese firm over alleged breach of contract

By on March 25, 2011

A LAGOS State High Court has adjourned trial on the suit brought by an indigenous Nigerian company, Michonest Solutions International Limited against a Chinese firm, Gaoxinqi Nigeria Limited and a Chinese national, Mr. Frank Ysihai over supply of sub-standard goods to Michonest to May 23, to enable the second defendant, (Ysihai) move his motions to amend his statement of defence and the striking out of the name of the first defendant (Gaoxinqi) from the suit.

The trial judge, Justice M. Onyeabo granted leave to the defendant to that effect following the submissions of the defendants counsel calling the attention of the judge to the motions and seeking to move them before the commencement of the trial.

But counsel to the claimant, Mr. Martins Nnebedum, who opposed the applications, urged the court to continue with the trial, explaining that admitting such motions half way through the trial was a delay tactics. However, the judge granted leave to the defendant to move his application at the next adjourned date.

Michonest Solutions International Limited and its Managing Director, Mrs. Eunice Maduanusi had dragged the first and second defendants to court, alleging that they defrauded her close to N3 million, being payment cost made in respect of the supply of standard electrical products in 2006 from China, which the defendants violated by supplying sub-standard products.

In the claimants statement of claims, she avers that the second defendant assured her that he would supply her company with a flexible copper wires of highest quality and in accordance with the standard stipulated by the Standard Organisation of Nigeria (SON) and other quality regulatory agencies in Nigeria and that based on such promises, she accepted to purchase the goods through the defendants.

She stated that she consequently entered into a contract with the second defendant for the supply of various specifications of small, medium and big flexible copper wires.

“Following the said agreement, the claimant on various dates paid to the second defendant and the second defendant received from the claimant, on behalf of the defendants, a total sum of  $ 9,230 representing the purchase cost of the following items namely, (1) 2000 pieces of big wire at $ 1.30 each, at 4500 pieces of medium wire at $1.10 each and (3) 2500 pieces of small wire at $0.57 each. One of the receipts issued to the claimant by the defendants evidencing payment of the sum of N500, 000 dated 18 November 2006, “ she stated.

According to her, aside the sum of $9,230 earlier pleaded, the claimant also paid to the second defendant and the second defendant received from the claimant on May 5, 2007 the sum of $11,770 representing the purchase cost of 15, 000 pieces of 3×3 wire at $0.128 each and 7000 pieces of big wire at $1.30 each.

She stated that she paid the total of $ 21, 000 to the defendant to cover the cost of the goods and freight in addition to N802, 815 cost incurred on clearing the goods from the Nigerian ports and customs clearing expenses. She further avers that in addition to customs and import duties paid at the ports, the company also spent the sum of N450, 000 as her counterpart container expenses.

She is praying for over N15 million as joint sums ranging from cost of payment for goods, clearing of goods, damages suffered, interest on the alleged sum spent and sum total of special damages and losses incurred from the warehouse where the “useless” products were stored and expected profit that were lost.

But in his statement of defence, the second defendant denied ever accepting to produce standard quality for the claimant, stating that the only assurance he gave to the claimant was that the wire to be sourced for them would be in accordance with the samples, which she brought along.

He added that the question of the wire being in accordance with the standard stipulated by the Standard Organisation of Nigeria did not arise since the claimant as the importer knows clearly how to get across the regulatory agencies at the ports in Nigeria.

According to him, manufacturers of all products in China allegedly have different standards and qualities and they produce to customers in accordance with their samples and/or request, as was the case in point.

He denied receiving the sum of US$9,230 as alleged by the claimant, adding that the first defendant (Gaoxinqi) was not involved in the transaction at all but that the he “merely used the first defendants invoice paper to acknowledge the receipt of N500, 000 paid to the Chinese suppliers through the second defendant,” adding that “the second defendant was forced to use the said invoice paper on the insistence of the claimant.

He insisted that the wires sourced for the claimant by the second defendant fully complied with the sample given to him by the claimant, stating that there is no way the manufacturers in China could have diverted a consignment meant for United Arab Emirate to the claimant.

In his 26 paragraph deposition on oath in support of his defence, the second defendant said the claimant never bordered to notify him when the goods arrive or when the goods were being off-loaded from the container into their warehouse to enable him determine whether they were really the goods imported by the claimant, adding that he never apologised or visited their warehouse and “promised to do something” as alleged by the claimant.

“Further the averment in paragraph 19 above, I wish to state that it was during police investigation that I came in contact with the said wires for the first time. In the process of going through the items I discovered that they never emanated from me,” he swore.

Source : Guardian