Mansour v El Nasr Export & Import Co, 1972-73 ALR S.L. 385

SECTION 42 MANSOUR v. EL NASR EXPORT & IMPORT CO .• 1972-73 ALR S.L. 385 C.A. third party victims of road accidents must be content with the rights and benefits given to them by the Motor Vehicles (Third P~y Insurance) Act (cap. 133) and by the other laws of the land. For these reasons, I would allow the appeal. FORSTER, J.S.C. and BROWNE -MARKE, J.A. concurred with the judgments of both BETTS, J.S.C. and LUKE, J.S.C. Appeal allowed. MANSOUR v. EL NASR EXPORT AND IMPORT COMPANY Court of Appeal (Cornelius Harding and Tejan, JJ. A. and Rowland Harding, J.): October 18th, 1973 (Civil App. No. 6/73) [ 1] Civil Procedure-pleading-matters which must be specifically pleaded­ accord and satisfaction as defence to action for breach of contract: In an action based on breach of contract, the defence of accord and satis­ faction may be relied upon only if it is pleaded specifically (page 393, lines 37-38; page 394, lines 1-3; page 400, lines 38-40). [ 2] Contract-accord and satisfaction-meaning: When a contract has been broken and the parties to it agree that the party in breach should give or do something to or for the injured party, who agrees to accept this in discharge of his cause of action against the other, there is an "accord," which will amount to a defence to an action based on the breach of contract if there is also "satisfaction," i.e. the party in breach perform­ ing in full and not merely in part his promise to give or do something (page 394, line 16- page 395, line 4). [ 3] Contract-accord and satisfaction-must be specifically pleaded: See [ 1] above. 5 10 15 20 25 [ 4] Sale of Goods-conditions and warranties-quality of goods-oral assur- 30 ance as to quality of specific existing goods is warranty-if omitted from written contract takes effect as collateral contract or as term of contract: When the seller of specific existing goods gives an oral assurance about their quality to a prospective buyer, that assurance is a warranty which, if omitted from the subsequent written agreement, prima facie takes effect as either (per Tejan, J.A. at page 390, lines 15-18; page 390, 35 line 39- page 391, line 2; page 391, lines 27-37; Cornelius Harding, J.A. concurring) an independent contract collateral to the principal agreement or (per Rowland Harding, J. at page 398, lines 20-30) as a term of the contract, the breach of which gives the buyer the right to claim damages, but no right to repudiate the contract (per Tejan, J.A. at page 391, line 27- page 392, line 2; Cornelius Harding, J.A. con- 40 curring). 385 THE AFRICAN LAW REPORTS [ 5] Sale of Goods-examination of goods--1;pecific existing goods-if quality warranted by seller, examination by buyer not necessary unless condition of contract: When the seller of specific existing goods has given a warranty as to their quality, it should not be necessary for the buyer to examine the goods unless it is a condition of the contract that the goods 5 should be examined (per Tejan, J.A. at page 390, lines 18-22; page 391, lines 2-7; Cornelius Harding, J.A. concurring). The appellant brought an action against the respondents in the High Court for general and special damages resulting from a breach 10 of contractual warranty by the respondents. The appellant agreed to buy 8,000 bags of Egyptian onions from the respondents. The latter gave an oral warranty that the onions were "in good condition" but this warranty was not in­ corporated in the written agreement. 15 The appellant's agent took delivery of the onions at the quay but it was not possible to examine them at the time since it was necessary to remove them quickly to avoid rent. The onions were taken to the appellant's store where they were sorted and found to be largely rotten. The appellant complained to the respondents 20 who disclaimed liability. The parties reached a compromise, how­ ever, under which the respondents would pay compensation to the appellant and also give him exclusive rights to import Egyptian onions into Sierra Leone for the next three years. The compen­ sation was paid but the respondents found it impossible to 25 implement the second part of this agreement. The appellant then brought the present proceedings for damages. The High Court (McCormack, J.) found that the respon­ dents had orally warranted the soundness of the onions, but said that the appellant should have examined them to ensure that they 30 conformed with the warranty, and implied that the appellant could have rejected the onions. It also found that the compromise agreement reached by the parties and partially satisfied by the respondents constituted an "accord and satisfaction" and had dis­ charged the appellant's right of action, although the defence had 35 not been specifically pleaded by the respondents. The appellant's claim was therefore dismissed. On appeal the appellant contended that- (a) having found that the respondents' statement amounted to a warranty the trial judge erred in holding that the appellant should have examined the 40 onions and by failing to reject them had accepted them with knowledge of their poor condition and was not therefore entitled 386 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. to damages; (b) the trial judge erred in finding that the compromise agreement and its partial satisfaction constituted accord and satis· faction so as to disentitle the plaintiff frotn claiming damages for the breach of contract. The appeal was allowed and general and special damages were 5 awarded. Cases referred to: (1) Bannerman v. White (1861), 10 C.B.N.S. 844; 142 E.R. 685, applied. (2) Harrison v. Knowles, [1918] 1 K.B. 608; [1918-19] All E.R. Rep. 306, 10 applied. Legislation construed: Sale of Goods Act (Laws of Sierra Leone, 1960, cap. 225), s.2(1): The relevant terms of this sub-section are set out at page 391, lines 18-23. s.16(2): "Where goods are bought by description from a seller who deals in goods of that description (whether he be the manufacturer or not), there is an implied condition that the goods shall be of merchantable quality: Provided that if the buyer has examined the goods, there shall be no implied condition as regards defects which such examination ought to have revealed .... " s.35(1): The relevant terms of this sub-section are set out at page 399, lines 7-12. Rogers-Wright, S.H. Harding and Basma for the appellant; Smythe, Q.C. and Miss Taylor for the respondents. 15 20 TEJAN, J.A.: 25 This is an appeal against the judgment of McCormack, J. dated December 1st, 1972. The circumstances of the case arise out of an oral agreement made on May 19th, 1971, between the appellant and the respondents, whereby the respondents offered to sell and the appellant agreed to buy 8,000 bags of onions on an oral 30 warranty that the onions were in good condition. The agreement, without the warranty, was on the same date reduced into writing and the written agreement reads as follows: "This is to confirm our agreement of to .day's date that we have sold to you and you agreed to buy 8000 red net bags of 35 Egyptian onions, which arrived in Freetown yesterday per B.S. Emma Menthenitis, at the price of Le3.35 per bag c & f Freetown. Payment will be effected by cheque certified by the Standard Bank of Sierra Leone Ltd., for the total value of Le26,800 (twenty-six thousand eight hundred leones), pay- 40 able on July lOth, 1971. 387 THE AFRICAN LAW REPORTS Please be informed that the said cheque should be presented to our office at the latest tomorrow morning in order to instruct for the release of the said consignment." The appellant's case is that when he took delivery of the onions, 5 he discovered that 4,120 bags of onions were rotten, 74 bags of onions short-delivered, and that another 400 bags of onions were half-full. The appellant reported his discovery to the respondents but the respondents' manager told him that the shortage was a matter for the insurance company. The manager there and then 10 drafted a letter which the appellant was to write to the respon­ dents' company. This letter dated June 17th, 1971 is in the following terms: "With reference to the consignment of Egyptian onions bought from you which arrived in Freetown per S.S. Emma 15 Menthenitis, please note that our claim regarding the said consignment is as follows: 7 4 bags short delivery; 400 bags arrived half packed, i.e. only 200 bags were full. Please refund us the value of 27 4 bags, being the total value of our claim, as the insurance was not our responsibility." 20 The reply to this letter was dated June 26th, 1971. In the reply, the respondents stated that their contract with the appellant carried no responsibilities with regard to his claim but for the sake of co-operation they would like to have official documents from the Port Authority with regard to the matters mentioned in the 25 appellant's letter. With regard to the condition of the onions, the appellant's witnesses, Abu Dyfan and Victor Coker gave evidence of this. Abu Dyfan bought 600 bags of onions out of the consignment and although he selected 600 bags which appeared to him to be 30 the best, yet in under a fortnight the onions started to rot and his estimated loss was 200 bags of onions; Dyfan complained to Mr. Lofti of the respondents' company, who promised to write to the head office. According to Dyfan, Mr. Lofti "was always saying different things at different times." 35 Victor Coker, who was the clearing agent of the appellant, took delivery of the onions and when he was taking delivery, he noticed that "the bags of onions were producing a strong smell." He also observed some spots on the bags from which he could see that the onions had started to rot. 40 Mohamed Lofti, the assistant manager of the respondents' company, on the other hand, denied that the onions were not 388 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. in "good condition." He said that when he saw the onions on May 29th, 1971 in the store of the appellant at 5 Sackville Street, they were in good condition, and that wlien he noticed that the store was a closed store, he advised the appellant to erect fans in it. 5 Mr. Josephus Smith also gave evidence with regard to the condition of the onions. This witness delivered the onions to Victor Coker the agent of the appellant, and he did not see "any rotten bags of onions or observe any smell." Dealing with the question of warranty, McCormack, J., in his 10 judgment, said: "In s.2(1) of the Sale of Goods Act (cap. 225 ), the term 'warranty' means- 'an agreement with reference to goods which are the subject of a contract of sale, but collateral to the main purpose of such contract, the breach of which gives 15 rise to a claim for damages, but not to a right to reject the goods and treat the contract as repudiated'.'' Further on in the judgment, the learned judge said: "I therefore accept the plaintiff's statement that the defendant orally warranted to him that the onions were in 'good condition'. Both parties 20 agreed that the onions are specific goods of a perishable nature." The learned judge, having found that the respondents orally warranted the soundness of the onions went on to say - "I now come to consider what opportunity the plaintiff had of examining the onions for the purpose of ascertaining 25 whether they were in conformity with the warranty under the contract. The evidence is that the entire cargo of onions was off-loaded from the ship 'Emma Menthenitis' and stacked outside shed No.2 at Queen Elizabeth II Quay from which position deliveries to several consignees were made. The 30 evidence is not controverted. The agent of the plaintiff, Mr. V .D. Coker, who went to take delivery on behalf of the plaintiff and the opportunity of seeing, toughing, feeling and smelling the onions for the purpose of ascertaining whether they were in 'good condition.' The plaintiff also, in my view, 35 had opportunity of examining the delivery of the first batch of 200 bags and subsequent batches of 200 bags when they were delivered at his store, by the simple and natural process of seeing, touching, feeling and smelling to ascertain whether they were in 'good condition' in conformity with the contract. 40 If the onions were rotten and not in good condition, why did 389 THE AFRICAN LAW REPORTS the plaintiff take delivery at all? I find that the plaintiff had reasonable opportunity of examining the onions for the purpose of ascertaining whether they were in conformity with the contract, and that he accepted delivery of the 5 onions." In his first ground of appeal, the appellant complained that the "learned judge erred in law in that, having found that the res­ pondents orally warranted the soundness of the goods comprised in the contract, he later found that it was necessary for the apel- 10 lant to examine the goods." The expression used by the respon­ dents was "good condition" and the words were used before the agreement was written. The learned judge found that the expression "in good condition" amounted to a warranty of the soundness of the onions. 15 The subject·matter of the contract between the appellant and the respondents is a specific existing chattel and a statement made as to the quality possessed by or attaching to the onions by the respondents amounts to a warranty. The expression that the "onions were in good condition" amounted to a statement as to 20 the quality possessed by or attaching to the onions. Where such a statement as to the quality of a chattel is made, I do not think that it should be necessary for the buyer to examine the chattel. In the case of Bannerman v. White (1) there was a contract for the sale of large quantity of hops, at a time when trouble was 25 being caused to the brewing industry in consequence of sulphur getting into beer, owing to the hops from which it was made being treated with sulphur by the growers. During the negotiations for the sale the defendants, who could not sell to their customers hops that had been treated with sulphur, stated expressly that they 30 would not consider the matter if sulphur had been used; and the plaintiff replied: "There was no mould this year and therefore no occasion to use any sulphur." As a matter of fact, sulphur had been used in five out of three hundred acres, and the hops from those five acres had become inseparably mixed with the others. 35 The court found (10 C.B.N.S. at 860; 142 E.R. at 692) that­ "this undertaking [that no sulphur had been used] was a pre­ liminary stipulation; and if it had not been given, the defendants would not have gone on with the treaty which resulted in the sale." In the present case, I think the appellants would not have 40 bought the onions if the warranty that the onions were in good condition had not been given, or alternatively, the appellants 390 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. would have requested to have the onions examined before enter­ ing into the contract of sale. I have carried out extensive research, and the authorities I have been able so far to discover, where the buyer of goods is required to examine them after a warranty of the soundness of the goods has been given, relate to cases in 5 which, in addition to the warranty of the soundness of the goods, there is a condition that the goods should be examined. The appellant also complained in his second ground of appeal that - "the learned trial judge having correctly stated the law as to 'warranty,' that is to say that 'warranty' means 'an agreement 10 with reference to goods which are the subject of a contract of sale, but collateral to the main purpose of such contract, the breach of which gives rise to a claim for damages, but not to a right to reject the goods and treat the contract as repudi- ated,' contradicted himself by asking the question 'If the 15 onions were not in good condition, why did the plaintiff take delivery at all?' '' In the Sale of Goods Act (cap. 225 ), according to s.2(1)­ "'warranty' means an agreement with reference to goods which are the subject of a contract of sale, but collateral to 20 the main purpose of such contract, the breach of which gives rise to a claim for damages, but not to a right to reject the goods and treat the contract as repudiated." Under the Sale of Goods Act, 1893 a buyer may reject goods if they do not correspond in quality, fitness, or description with the 25 contract. The buyer's obligation to accept depends on the com­ pliance by the seller with his obligation to deliver. If the contract is for specific goods a stipulation as to quality or fitness is prima facie an independent contract collateral to the principal agreement and only giving rise to an action for damages. 30 In the present case, the contract was for the sale of specific goods, namely 8,000 bags of Egyptian onions. A stipulation as to the fitness of the onions was made by a representative of the respondents' company when he told the appellant that the onions were in good condition. This being a warranty as to the quality 35 and fitness of the onions, it did not affect the foundation of the contract but was simply collateral to its main purpose, and since a "breach of warranty gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated" the appellant even after having discovered that some of the onions 40 were not in good condition and that some were short-delivered, 391 THE AFRICAN LAW REPORTS was entitled to accept the onions, and then claim damages for breach of warranty. The appellant's fourth ground of appeal is - "that having regard to the terms of Exhibit 0 (concerning 5 a compromise agreement) dated October 4th, 1971 and addressed to the defendant, and the terms of Exhibit R written by the plaintiff the learned trial judge erred in con­ cluding that the terms of Exhibit 0 constituted an accord and satisfaction so as to disentitle the plaintiff from bringing 10 suit." Now, it seems that when the appellant could not get any satis­ factory response to his complaint, one Mr. Youssef, another representative of the respondents' company advised the appellant to go to the head office in Cairo. Following the advice of Mr. 15 Youssef, the appellant went to Cairo and interviewed the general manager with regard to his complaints. The general manager then suggested that in order to settle the matter, he would give the appellant compensation of the sum of Le3 ,200 plus a period of three years' monopoly to sell and import onions in Sierra Leone. 20 The appellant agreed to this suggestion, and to confirm the agree­ ment, the general manager wrote Exhibit 0 on October 4th, 1971. Exhibit 0 which was directed to the Director, El Nasr Export & Import Company, Freetown Sierra Leone Branch is written in the following terms: 25 "Complaint of our Agent Muhidden Mansour in Freetown (Sierra Leone) Relating to a Shipment of Onions shipped per S.S. Emma Menthenitis on May 29th, 1971. With reference to the above-mentioned subject, please take note that Mr. Muhidden Mansour, the branch agent for 30 onions came to the head office in Cairo, and the company discussed with him the complaint he had submitted con­ cerning the financial loss· he suffered as a result of Mr. Salim Talib 's refusal to take delivery of the onions and heard that the financial losses suffered by the said agent (Mr. Mansour) 35 amount to .£10,000 (ten thousand pounds sterling). In your letter reference No. 226/71, supported by your cablegram, No. 1117 addressed to the company you stated that the loss suffered by Mr. Muhidden amounts to £8,000 (eight thousand pounds sterling). 40 As a result of the company's policy to maintain a good relationship with its agent, we have tried to arrive at a 392 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. compromise whereby we would meet part of the losses he had suffered, even though the company is not responsible for this loss. The general manager of all overseas branches has therefore agreed to conclude this matter by compensating Mr. Mansour 5 in accordance with the following directives, all of which should be implemented in Sierra Leone. (1) That a compensation of £1,600 (one thousand six hundred pounds sterling), be paid to him. (2) That he should be given sole and exclusive rights for the 10 importation of Egyptian onions over all other agents in Sierra Leone during the coming season and for the next three years, at the price at base. But whereas Mr. Muhidden Mansour has been given the first option to import onions at the price fixed at base as stated above, 15 we would have the right to offer the onions to another agent at a price not lower than that offered to him should he refuse to accept the offer. This is based on the understanding that the inter- national price level for Egyptian onions does not change 20 and all other things remain the same. Please take note and act accordingly." In dealing with this letter in his judgment, McCormack, J. said: "I now come to consider the effect of Exhibit 0 which is dated October 4th, 1971. It was written by the head office of 25 the defendants in Cairo to the defendants' office in Freetown, and concerns the subject-matter of this action. The plaintiff in evidence said he accepted the terms of Exhibit 0, he also said that he had received the sum of Le3,200 mentioned therein. 30 In my view Exhibit 0 is an accord and satisfaction in the law of contract, the effect of which is to discharge the right of action possessed by the plaintiff in respect of the original contract. The plaintiff ought never to have brought this action. The action is therefore dismissed with costs to be 35 taxed." It is true that accord and satisfaction is a matter of fact, but it becomes matter of fact only when it has been specifically pleaded. A party must in any pleading subsequent to a statement of claim plead specifically any matter, for example, performance, release, 40 any relevant statue of limitation, fraud or any fact showing 393 THE AFRICAN LAW REPORTS illegality. It cannot be argued that the plea of accord and satis­ faction is not a plea of release, and since it is a plea of release, it must be specifically pleaded. The plea is one of the pleas listed under the rubric- "Matters which must be specifically pleaded" 5 (0.18, r.S, note 2, of the White Book). The respondents did not at any time in their pleadings avail themselves of the plea of accord and satisfaction, and in my view, it is a flagrant disregard of the rules of pleadings for the learned judge to have considered the plea in his judgment when the matter was never raised by the 10 respondents in their pleadings. But in the event of my being wrong that accord and satisfaction must be specifically pleaded, then the question whether the compromise agreement is an accord and satisfaction arises. Dealing with accord and satisfaction, Odgers on Pleading & 15 Practice, 20th ed., at 204 (1971) states: "They are both technical terms, and the plea must allege both. Suppose that B has broken his contract with A; then A and B agree together that B shall give or do something to or for A, and that A shall accept this in discharge of his cause of 20 action against B. This is an 'accord'; and if the matter rests there, there is no defence to an action brought by A on the original contract. But if B in pursuance of the 'accord' gives to A or does for him what was agreed, this is a 'satisfaction,' and the two together afford B a good defence to any action 25 on the original contract. E.g., X agrees to sell and deliver to Y a Broad wood piano for £200, but is unable to obtain a Broad­ wood piano. He askes Y to accept an Erard piano of at least equal value, and Y agrees to do so. This agreement alone affords X no defence to an action by Y, unless and until X 30 delivers the Erard piano to Y." Now to apply this principle to the present case. According to the compromise agreement the respondents agreed to pay the sum of £1 ,600 plus the sole and exclusive rights for the importation of Egyptian onions over all other agents in Sierra Leone during the 35 coming season and for the next three years, at the price fixed at base. The appellant agreed to this. Obviously, this part of the agreement is an accord. The respondents then paid the sum of £1,600 to the appellant, but failed to comply with c1.2 of the compromise agreement that is, the sole and exclusive rights for 40 the importation of Egyptian onions over all other agents in Sierra Leone during the coming season, and for the next three years, at 394 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. the price fixed at base. Such inability on the part of the respon­ dents to carry out cl.2 cannot under any circumstances amount to satisfaction, for the law deals with satisfaction and not with partial satisfaction. Since the respondents did not in their pleadings plead that cl.2 5 of the compromise agreement was impossible to perform so as to amount to a frustration of the contract, a plea which must be specific, I do not consider it necessary to deal with the effect of changed or unforeseen circumstances on contracts. I shall now deal briefly with the evidence in respect of the con- 10 dition of the onions. [The learned Justice of Appeal then repeated the evidence concerning the condition of the onions in the apel­ lant's store and continued:] With regard to his finding of fact in respect of the condition of the onions, the learned judge said: "I have now to consider whether the onions were delivered to 15 the plaintiff in 'good condition'. The plaintiff and his witness V.D. Coker, deposed in evidence that when the first batch of 200 bags of onions was received it was producing a very strong smell and there were spots on some of the bags, and that some had holes through which one could see that the 20 onions had started to rot. The plaintiff called one Abu Bakar Dyfan who stated in evidence that he was a consignee of 600 bags of onions from the cargo of onions which arrived on the ship 'Emma Menthenitis', that he cleared his 600 bags from a large stock of onions, that the onions appeared good 25 but there were a lot of tom bags, that he took the onions into his store; that in under two weeks the onions started to get rotten. He then started to sort out the good ones from the rotten ones. This witness in cross examination said: 'I went to Queen Elizabeth II Quay to collect the onions 30 myself. The Ports Authority handed over the onions to me in batches of 200 bags. I signed a delivery slip for each batch that I received.' This witness also tendered in evidence delivery slips, each form contained the words 'received in good con- dition' and the witness signed under these words. 35 As against the evidence of the plaintiff and his witnesses in respect of the condition of the onions, the defendants' representative, a Mr. Lofti, said in evidence: 'I saw the onions about May 29th, 1971 at the store of the plaintiff at 5, Sackville Street. The onions when I saw them were in 40 'good condition.' Under cross-examination by learned counsel 395 THE AFRICAN LAW REPORTS for the plaintiff this witness said: 'I went to the plaintiff's store, because I was called by the plaintiff. He called me to see the onions in his store because he was so pleased with their condition, he said they looked like apples instead of 5 onions.' The defendants also called the foreman in charge of deliveries at the Sierra Leone Ports Authority, the manager of Swalenco Agencies who were the clearing and forwarding agents, and others who testified that the onions from the ship 'Emma Menthenitis' arrived in 'good condition' and that they 10 were delivered to the plaintiff in good condition. They also tendered in evidence delivery slips Nos. A150978 to A152599; 40 slips in all each of which had a receipt clause at the foot with the words 'received in good condition', and in this case the plaintiff's agent signed on behalf of the plaintiff. I accept 15 the evidence of the defendants that at the time of delivery of the onions to the plaintiff the onions were in good condition and in conformity with the contract." It is true that an appellate court rarely interferes with the find­ ing of fact of a lower court but the evidence with regard to the 20 condition of the onions reveals certain compelling circumstances which I think demand interference. I cannot escape from the fact that the learned judge having found that the respondents warranted the soundness of the onions, and well knowing that the appellant could not have rejected the onions and treated the contract as 25 repudiated, posed this question: ''If the onions were rotten and not in good condition, why did the plaintiff take delivery at all?" It seems to me that this question did not only influence the mind of the learned judge as to the quality of the onions but also led the learned judge to the erroneous assumption that the fact that 30 the appellant received the onions meant that the onions were in good condition. Moreover the evidence itself as narrated by the learned judge disclosed that Mr. Lofti was sent for by the apel­ lant. Why did the appellant send for Mr. Lofti? According to Mr. Lofti he was sent for simply to admire the good condition 35 of the onions which were like apples. One would have thought it more likely or perhaps reasonable for a buyer of goods, in ordinary circumstances~ to send for the seller not to tell him about the high quality of the goods but so that the seller himself should be able to confirm the complaints made about the bad condition of the 40 goods. This is a process of reasoning which one cannot afford to ignore. I have no doubt, however, that the fact that the appellant 396 MANSOUR v. EL NASR EXPORT & IMPORT CO.,l972-73 ALR S.L. 385 C.A. did not reject the goods, a right of rejection which he could not legally exercise, greatly influenced the learned trial judge to come to the conclusion as to his finding of fact that the onions were in good condition. Had the learned trial judge addressed his mind to the section of the law which prohibited the appellant from reject- 5 ing the onions and treating the contra-ct as repudiated, his finding of fact on this important matter would have been different. There is evidence that 4,120 bags of onions were rotten, that their cost price was Le4 per bag and that the sum of 50 cents would have been the profit per bag, that the sum of Lel,040 was 10 paid to the hired labourers who sorted out the onions; that 400 bags of the onions were half-full leaving a quantity of 200 bags the cost price of which was the sum of Le4 per bag, and that the sum of fifty cents per bag would have been the profit; that the sum of Lel98 was expended on the disposal of the rotten onions, 15 and that the appellant had already received from the respondents the sum of Le3,200. There is also the evidence that the total sum of Le3,774.85 was paid by the respondents to the appellant as shown in Exhibit Q. On the whole, I find that the respondents are liable for breach 20 of warranty. I would allow this appeal, set aside the judgment of the High Court and give judgment for the appellant for the sum of Le16,903.15 special damages, the sum of Le300 general damages and costs in this court and the court below to be taxed. CORNELIUS HARDING, J.A.: I concur with the judgment of Tejan, J.A. This is one of those rare cases where an appellate court should feel free to interfere with the finding of act of a lower court. Here was a contract for 25 the sale of specific goods, to wit, 8,000 red net bags of Egyptian 30 onions ex S.S. "Emma Menthenitis" at an agreed price. There was a warranty given regarding the soundness of the onions "the breach of which gives rise to a claim for damages, but not to a right to reject the goods and treat the contract as repudiated." The mere fact that when the buyer's agent went to take 35 delivery of the goods at the quay he signed the delivery slip to the effect that they were "received in good condition" and the fact that the goods were not rejected outright by the buyer but were accepted by him, do not in themselves establish that the goods were in conformity with the contract. There were 8,000 bags of onions 40 and the only means of ascertaining whether they were in good 397 THE AFRICAN LAW REPORTS condition is, to quote the learned trial judge, "by the simple and natural process of seeing, touching, feeling and smelling" and in this particular instance this could only have been conveniently done, not at the quay where "speed was essential to avoid rent", 5 but at the buyer's store. Even the seller himself admitted that he "did not reasonably expect the plaintiff (i.e. the buyer) to examine 8,000 bags of onions down the quay." There is strong evidence that immediately the onions were received they were examined and sorted out and 4,120 bags were found to be rotten. It would 10 appear that the learned trial judge completely disregarded this piece of evidence and relied heavily on the fact that it was stated in all the delivery notes that the goods were received in good con­ dition and hence he came to the finding that they were in con­ formity with the contract. He placed a wrong evaluation on the 15 entire evidence and consequently the conclusions he drew were wrong. The appeal must be allowed. ROWLAND HARDING, J.: [The learned judge reviewed the evidence and continued:] 20 The trial judge, applying Harrison v. Knowles (2) held that the fact that an oral agreement is subsequently committed to writing or a memorandum in writing thereof is made does not prevent a previous oral warranty or stipulation not expressed and omitted in the written document from amounting to a stipulation in the con- 25 tract or warranty collateral to the contract. He accepted the plaintiff's statement that the defendants orally warranted to him that the onions were in good condition. [The learned judge repeated the evidence as found by the trial judge and continued:] On the authority of Harrison v. Knowles I agree with McCormack, 30 J. that the oral warranty was collateral to the contract of sale. [The learned judge reviewed the findings of the trial judge and continued:] I disagree with McCormack, J. when he said that the plaintiff's agent, Coker, on taking delivery of the first 200 bags had the 35 opportunity of examining the onions at the quay, by seeing, touching, feeling and smelling the onions to ascertain whether they were in "good condition," and that the plaintiff had a similar opportunity when the first 200 bags were delivered at his store, by the same simple process to ascertain whether they were 40 not only in good condition but also in conformity with the contract. 398 MANSOUR v. EL NASR EXPORT & IMPORT C0.,1972-73 ALR S.L. 385 C.A. It would have been unreasonable to expect the plaintiff to examine 8,000 bags of onions down on the quay when taking delivery; speed was essential to avoid rent which was due on the eighth day after the departure of the Emma Menthenitis; Lofti for the defendants confirmed this. Therefore the examination had to 5 be done outside the quay. Section 35(1) of the Sale of Goods Act (cap. 255) states: "Where goods are delivered to the buyer, which he has not previously examined, he is not deemed to have accepted them unless and until he has had a reasonable opportunity of 10 examining them for the purpose of ascertaining whether they are in conformity with the contract." Out of 8,000 bags of onions the fact that a number of bags delivered are rotten or have started to rot is not conclusive that the 7,800 bags which remain to be delivered and examined have 15 rotted or started to rot or that they are not in good condition or not in conformity with the contract. Also, where goods which the buyer has not previously examined are delivered, he is not deemed to have accepted the goods in performance of the contract until he has had a reasonable opportunity of examining the goods to ascer- 20 tain whether they are in conformity with the contract. The next question to be answered is whether the onions were delivered to the plaintiff in "good condition." [The learned judge reviewed the evidence of the condition of the onions and con­ tinued:] I accept the plaintiff's and his agent's evidence that on 25 delivery some of the first 200 bags and a good many bags sub­ sequently delivered were not in good condition since the defen­ dants and their witnesses did not examine the 7,976 bags delivered to the plaintiff. The answer to the question is that the greater part of the onions were not delivered in good condition, 4,210 bags 30 were rotten. Like McCormack, J. I give no weight to the fact that the "notice to abate nuisance" which was produced in evidence, did not emanate from the proper authority i.e., the Ministry of Health for Freetown. The plaintiff claims 27 4 bags short-delivered and 4,210 bags 35 which were rotten. The onions were sold in Freetown and delivered at the Queen Elizabeth II Quay, Freetown. Therefore the plaintiff was not concerned with the insurance of the onions between Cairo, the port of origin and Freetown, the port of destination. The plaintiff was not the importer and there was no privity of contract 40 between the insurance company and the plaintiff, although the 399 THE AFRICAN LAW REPORTS defendants say that the short delivery and rotten condition of the onions were the liability of the insurance company. By s.l6(2) of the Sale of Goods Act (cap. 225) there is an implied condition of merchantable quality. By s.35(1) of the Act, 5 where the buyer takes delivery of goods which he has not pre­ viously examined, he has not accepted the goods unless and until he has had a reasonable opportunity of doing so to ascertain whether the goods are in conformity with the contract. By s.53 of the Act, where a buyer on breach of the implied condition of 10 merchantable quality elects to treat the breach of condition as a breach of warranty, he accepts the goods and sues for damages instead of repudiating the contract. I do not agree with McCormack, J. when he said that the plain­ tiff, having taken delivery of the first 200 bags, had the opportunity 15 of examining them, and that by taking delivery the plaintiff had accepte4-~e goods. The~'defendants compromised the plaintiff's claim by making a new agree~ent with him containing two conditions: (1) That com­ pensation of £1,600 or Le3,200 be paid to the plaintiff. (2) He 20 would be given sole and exclusive rights over all agents in Sierra Leone for the importation of Egyptian onions during the coming season and for the next three years at the price fixed at base. The plaintiff accepted the two conditions and did receive Le3,200 but was informed that the defendants found it impossible to carry 25 out Condition 2. [The learned judge described how the plaintiff was informed by the defendants and continued:] McCormack, J. decided that the plaintiff's cause of action for breach of warranty ·in the original agreement of sale was super­ seded by the compromise agreement, both parties having agreed 30 to it and the plaintiff having received Le3,200 mentioned in it. He said: "It is an accord and satisfaction, the plaintiff ought not to have brought this action," I disagree with him. Condition 2 could not be performed by the defendants, therefore the com­ promise agreement was void and did not fulfil the purpose intended. 35 The original agreement and the plaintiff's claim under it revived; there was no accord and satisfaction, and the Le3,200 received by the plaintiff under it will be dealt with later in settling the accounts. Even if the compromise agreement was valid, "accord and satisfaction" is one of those defences which must be speci- 40 fically pleaded, and it was not pleaded by the defendants. [The learned judge reviewed the trial judge's findings on the question of 400 MANSOUR v. EL NASR EXPORT & IMPORT CO., 1972-73 ALR S.L. 385 C.A. accord and satisfaction and continued:] I find the defendants liable for breach of contract. Instead of rejecting the goods and repudiating the contract the plaintiff elected to accept the goods, treat it as breach of warranty and sue for damages. The defendants are therefore liable for: (1) 7 4 bags 5 of onions short delivered at the quay, ( 2) 200 bags which were used to fill up the 400 bags delivered half full at the quay, (3) 4,120 bags which were found to be rotten on examination. The plaintiff paid Le26,800 purchase price for 8,000 bags = Le26,800 10 Le5,000 for customs duty and postage = Le 5,000 Total Le31,800 Each bag costs Le3.975 Leones 274 bags at Le3.975 ........ 1,089.15 15 4,120 bags at Le3.975 ...... 16,377 .00 Paid labour sorting onions ... 1,040.00 Paid labour disposing of rotten onions . . . . . . . . . . . . . 198.00 20 18,704.15 There is no independent evidence of the selling price of onions after the plaintiff accepted the onions on taking delivery, nor did the plaintiff say what the selling price was from which the profit he claimed could be determined, therefore I award nothing for lost 25 profit resulting from the breach. On November 17th, 1971 the defendants paid and the plaintiff accepted a cheque for Le3,774.85. The defendants are to pay the plaintiff the difference between what is found due to the plaintiff and what the plaintiff received from the defendant, which is 30 Le14,929.30 special damage. General damages are assessed at Le200 for the worries undergone by the plaintiff in going to and from the defendants to settle his claim, and the risk of flying to and from the defendants' head office in Cairo at the defendants' request to settle this matter. 35 The appeal is allowed. There will be judgment for the plaintiff, special damages: Le14,929.30, general damages: Le200, with costs here and below to be taxed. Appeal allowed. 401 40