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HOME [1995 - 96] GHANA LAW REPORT

HIGH COURT, ACCRA

14 MAY 1996

BENIN JA

Bailment—Bailment for reward—Liability of bailor—Delivery of IFA truck for repairs at plaintiff's garage—Job
card evidencing contract of bailment signed by representatives of both parties—Refusal of defendant to pay
for repairs done on truck on ground that it never requested or consented to repairs—Whether contract of
bailment existing between parties—Whether defendant to pay for repairs.

Contract—Warranty—Enforcement—Defendant granted warranty for free servicing by vendor of IFA truck as

HEADNOTES

The defendant brought an IFA truck it had bought from Transport Maschinen (a firm in the German
Democratic Republic) to the plaintiff's garage for repairs. A job card was prepared and signed by
representatives of both companies. However, on completion of the repairs, the defendant refused to pay a
bill of ¢4,293,604.22 the plaintiff charged for effecting the repairs. The plaintiff therefore brought the instant
action claiming recovery of the amount owed plus interest. The defendant resisted the action on the
grounds, inter alia, that (1) it was their vendor (Transport Maschinen) which recommended that the vehicle
should be brought for repairs at the plaintiff's garage and that they neither requested nor consented to the
repairs done: [p.663] and (2) they had a warranty with the vendor for free servicing if the defect was the
manufacturer's and that since the plaintiff was the local agent of the vendor the warranty was enforceable
against it.

Held:

(1) when a vehicle was delivered to a garage which in the normal course of business undertook repairs, the
very act of the delivery implied a contract between the parties for bailment of hire of work and labour. In the
instant case, therefore, by delivering the vehicle to the plaintiff for repairs, the defendant was understood to
have agreed to pay for the repairs and the plaintiff was understood to have agreed to perform the work
satisfactorily. Furthermore, the existence of a job card duly executed by the parties meant that the vehicle
owner had agreed to pay for the repairs he had specified to be done by the plaintiff. Consequently, the
defendant had to pay for the cost of repairs. Stindt v Roberts (1848) 5 Dow & L 460; Morgan v Ravey (1861)
6 H & N 265; Chappell, In re; Ex parte Ford (1885) 16 QBD 305, CA and Nelson (James) & Sons Ltd v Nelson
Line (Liverpool) Ltd [1908] AC 108, HL cited.

(2) A warranty was a term of a contract which was collateral to the main purpose of the contract. In order
for a warranty to be enforced against a party, there had to be proof of an existing contract to which he was a
party and of which the warranty formed a part. Accordingly, where no contract existed at all, these could not
be a warranty. In the instant case, there was no contract of sale of IFA trucks between the plaintiff and the
defendant and there was also no after sales service agreement between them. Moreover, the defendant
could not rely on the relationship between the plaintiff and Transport Maschinen since it was not a party to
it. Furthermore, whatever warranty was given the defendant by Transport Maschinen was enforceable
against Transport Maschinen only. Accordingly, in the absence of any contract between the plaintiff and the
defendant there was no warranty between them let alone an enforceable one. Oscar Chess Ltd v Williams
[1957] 1 All ER 325, CA and Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 2 All ER 65, CA
cited.

CASES REFERRED TO

(1) Morgan v Ravey (1861) 6 H & N 265; 3 LT 784; 30 LJ Ex 131.

(3) Stindt v Roberts (1848) 5 Dow & L 460; 17 LJQB 166; 6 LT 257.

(4) Nelson (James) & Sons Ltd v Nelson Line (Liverpool) Ltd [1908] AC 108; 98 LT 322; 24 TLR 315, HL.

(5) Oscar Chess Ltd v Williams [1957] 1 WLR 370; [1957] 1 All ER 325, CA.

(6) Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [p.664] [1965] 2 All ER 65, CA.

(7) Finnegan v Allen [1943] KB 425, CA.

NATURE OF PROCEEDINGS

ACTION by the plaintiff for the recovery of the amount of ¢4,293,604.22 being the cost of repairs it had
carried out on a truck belonging to the defendant but which the defendant had refused to pay on the ground,
inter alia, that it was granted a warranty for free servicing by the vendor of the truck. The facts are
sufficiently stated in the judgment.

COUNSEL

Mrs Gertrude Torkonoo for the plaintiff.

George Thompson for the defendant.

JUDGMENT OF BENIN JA.

The plaintiff sued the defendant claiming the following reliefs:

"(a) An order for the recovery of the sum of ¢4,293,604.22 being the total cost of repairs carried out on the
defendant company's vehicle.

(b) Interest at the rate of 30 per cent on the said amount from 14 April 1988 up to the date of final
judgment."

The plaintiff's case as pleaded was that the defendant sent a vehicle to its workshop for repairs in April
1988. It carried out the repairs at a cost of ¢4,293,604.22. But the defendant has refused to settle the cost
of repairs despite repeated demands made upon it to settle. Hence the reliefs sought.

The defence pleaded the following material facts, namely:

"(i) That it sent the vehicle to the plaintiff's workshop upon the advice and direction of Messrs Transport
Maschinen Export & Import (hereinafter called Transport Maschinen) who are the principals of the plaintiff
in respect of IFA trucks (of which the defendant's truck was one). The defendant was to inspect the
damaged vehicle and give a technical report on it to Transport Maschinen.

(ii) That the defendant did not even request an estimate of repairs of the vehicle let alone to authorise the
plaintiff to repair it.

(iii) That the plaintiff might have carried out the repairs upon the [p.665] direction and request of Transport
Maschinen who were liable under a warranty to pay for the said repairs.

(iv) That the repairs became necessary since it was the manufacturer's defect that led to the damage to the
vehicle thereby bringing the warranty to repair into play."

In its reply the plaintiff denied being the agent of Transport Maschinen and that it (the plaintiff) only has an
after sales service agreement for Ghana with it. The plaintiff averred that the defendant executed a job card
authorising the plaintiff to execute the repairs. That it was after the repairs that Transport Maschinen
requested the plaintiff to submit an official technical report on the defendant's vehicle which it did. That the
defendant never stopped the plaintiff from carrying out the repairs. That any warranty that existed between
Transport Maschinen and the defendant had nothing to do with the plaintiff's repairs of the vehicle.

At the summons for directions, the following issues were agreed upon:

(a) Whether or not the defendant entered into a contract with the plaintiff for the latter to do some repair
work on its vehicle.

(b) If so, whether the defendant is liable to pay the plaintiff the sum of ¢4,092,382.91 being claimed as the
total cost of repairs.

(c) Whether or not the plaintiff is the agent of Transport Maschinen and carried out the repairs on the
latter's instructions.

(d) Whether the plaintiff is entitled to his claim.

The plaintiff's case appears to rest on a contract of bailment for hire of work and labour. This is because the
plaintiff pleads that the vehicle was given to it by the defendant in order for it (the plaintiff) to repair it for
reward. Thus the defendant (as bailor) was under a duty to pay the agreed price, and in the absence of an
agreement as to the price, to pay a reasonable remuneration on a quantum meruit basis. It will seem that a
bailee who executes repairs to the chattel without the owner's consent cannot recover the expense from the
bailor. In other words, no obligation arises unless there is an express or implied request from the defendant
to the plaintiff for the work to be done or the services to be rendered. The law does not permit claim for
services [p.666] rendered or work done in the absence of an express or implied contract between the
parties except in cases of salvage, agency of necessity and probably professional services rendered in an
emergency. In all the known exceptional cases, there must be an emergency about the situation.

So the most important and indeed the crucial issue for determination in this case is whether there was an
agreement, express or implied, that the plaintiff should repair the vehicle for the defendant. If that is settled
then the next obvious issue will be whether the defendant or Transport Maschinen is responsible for the
payment of the cost of repairs.

The initial burden of producing evidence to satisfy the court that an agreement existed between them
whereby the plaintiff undertook to repair the defendant's vehicle for reward rests on the plaintiff. Thus the
plaintiff has to establish a contractual relationship between it and the defendant and when this is done then
the claim for recovery of the sum of money will lie. As decided in the case of Morgan v Ravey (1861) 6 H &
N 265, wherever a relationship exists between two parties, which involves the performance of certain duties
by one of them and the payment of reward to him by the other, the law will imply or the court may infer, a
promise by each other to do what is to be done by him.

The plaintiff, as stated already, pleaded that a job card was opened for the defendant when the latter
brought the vehicle for repairs. The plaintiff also led evidence on this issue. The job card which was
tendered in evidence as exhibit A was said to have been signed by the defendant.

These facts were admitted by the defendant's managing director, Mohammed Abass, when he testified on
oath. What is a job card? On this the plaintiff's representative said:

"A job card is a document which we prepare when a customer brings his vehicle to us for repairs, on which
we state the nature of repairs requested by the customer and we make the customer sign it to indicate that
he has authorised us to do the job. The defendant signed it. When we finish the job we draw a bill for the
customer based on the job card."

This piece of evidence, material as it were, was never challenged or [p.667] rebutted and so I accept the
facts contained therein as true. The relevance of this evidence is that the contract for hire of work and
labour was evidenced by this job card. The parties are identified, so is the subject matter. Aidoo, the first
defendant witness, said he signed it not for the plaintiff, but for the foreign company, but this does not
appear to be the position from the face of the exhibit. The defendant signified his acceptance by signing it.

It seems to me then, as it did to Lord Esher MR in Re Chappell; Ex parte Ford (1885) 16 QBD 305, CA that
wherever circumstances arise in the ordinary business of life in which, if two persons were ordinarily honest
and careful, one of them would make a promise to the other, it might properly be inferred that both of them
understand that such a promise was given and accepted. In this case, by delivering the vehicle to the
plaintiff for repairs, the defendant was understood to be saying it would pay for the repairs, and the plaintiff
was, on the other hand, understood to be saying that it would do the work satisfactorily. And, in my view,
ordinarily when you deliver your vehicle to a garage which in the normal course of business undertakes
repairs, the very act of the delivery implies a contract between the parties for hire of work and labour. It is
thus not far-fetched to adopt the analogy drawn in the case of Stindt v Roberts (1848) 5 Dow & L 460 that
there may be a contract by the act of a party, such as if a man goes into a shop where he usually deals, and
takes up an article, say nothing, and walks away; a contract would arise and the law would imply a contract
to pay for the article. Let me also refer to a relevant point made by Lord Halsbury in Nelson (James) & Sons
Ltd v Nelson Line (Liverpool) Ltd [1908] AC 108 at 115, HL:

"I do not deny that there are some things so commonly known and practices so universal that, without
evidence other than the transaction itself, one infers a contract. What the parties do is itself, where there is
such a known course of dealing, evidence of their agreement. In such a case the mere action of the parties
in accordance with usage is of itself evidence of a contract."

It is commonly accepted that garages where vehicles are repaired open job cards for each vehicle sent
there and ordinarily the very fact of the delivery of a vehicle to the garage and the opening of the job card
constitute the contract between the parties. Thus in this case, the [p.668] plaintiff had, prime facie, satisfied
the court that there was a contract between it and the defendant to repair the latter's vehicle for a reward.
Hence the burden will be on the defendant to lead rebuttal evidence that notwithstanding the job card, there
was no such contract between the parties herein.

The defence will thus be considered in detail. The defendant made the following material averments in its
pleadings:

"(2) The defendant sent the said vehicle to the plaintiff's workshop upon advice and direction by Messrs
Transport Maschinen Export-Import the principals of the plaintiff in respect of IFA trucks for the plaintiff to
inspect the damaged vehicle and give a technical report on it to Messrs Transport Maschinen Export-
Import, Accra branch.

(3) The defendant says that the averment in paragraph (2) was the only reason why the defendant sent the
vehicle to the plaintiff and not for repairs to be carried out on the vehicle. The defendant says that it did not
either orally or by writing request even an estimate of repairs of the vehicle nor did it authorise the plaintiff
to repair the vehicle either orally or by writing; in short the defendant has not entered into any contract with
the plaintiff to carry out any repairs on the vehicle.

(5) The defendant says that the plaintiff might have carried out the repairs upon the direction and request of
Messrs Transport Maschinen Export - Import of German Democratic Republic, who are liable under warranty
to pay for the said repairs."
All the foregoing averments were rejected by the plaintiff in its reply. The following matters have to be
considered for the defence:

(i) whether the job card was signed for the plaintiff or on behalf of Transport Maschinen;

(ii) whether the work on the vehicle was done by the plaintiff or by officials of Transport Maschinen;

(iii) if it was done by the plaintiff, whether it was Transport Maschinen or the defendant which authorised it;
and

(iv) the warranty.

Both parties as well as Transport Maschinen, being limited [p.669] liability companies, act by their
accredited human officers or agents. The supervisor of the plaintiff's workshop at the material time, one J K
Aidoo, has testified in this case for the defendant and his evidence cannot be brushed aside lightly,
especially in the absence of any suggestion as to collusion with the defendant. But we must consider his
testimony rather critically, especially when viewed against the background that the plaintiff knew and had
cause to believe that as its employee, Aidoo, the first defendant witness, was acting for it and in its interest
at all times. The plaintiff knew and believed he had signed the job card for it as its supervisor. But he now
says he rather signed it for Transport Maschinen. I will have to examine his testimony vis-a-vis that of the
defendant's representative, Mr Abass, who also signed the job card for his company.

Mr Abass' relevant evidence was as follows: he said after the vehicle was involved in the second accident
he made a report to Mr Scharm of Transport Maschinen and Mr Aidoo, who advised him to tow the vehicle
to the workshop. He continued that:

"two weeks after the accident we towed the vehicle to the yard of the plaintiff and was sent to the rear of
the yard in order not to scare off prospective purchasers of IFA vehicles. Scharm and Aidoo said they
wanted to check and know why the bucket got off a second time."

On the job card, this is what the witness said:

"Apart from signing a paper at the security check point, I did not sign any other paper. That paper I signed
there was given to me by the security man at the place. The security man made me to understand that
anybody who brought a vehicle was requested to sign."

The relevance of his testimony was that he signed this job card for his company and that it was a security
man, not Mr Aidoo, who gave him this job card to sign. Mr Aidoo in his testimony said he prepared this job
card on the instruction of Mr Scharm and that he, Mr Aidoo, signed it for IFA, ie Transport Maschinen. On
the face of the job card there is nothing to show that Mr Aidoo signed this job card for IFA or Transport
Maschinen. But besides this, Mr Aidoo's testimony is at variance with the defendant's own pleadings. The
defendant averred [p.670] in paragraph (7) of the statement of defence that it sent the vehicle to the
plaintiff's workshop upon the advice and direction of Transport Maschinen, the principals of the plaintiff in
respect of IFA trucks for the plaintiff to inspect the damaged vehicle and give a technical report on it to
Transport Maschinen. This being the reason why the defendant took the vehicle to the plaintiff, it is hard to
accept that the job card was not opened by and for the plaintiff. The defendant itself has pleaded it did send
this vehicle to the plaintiff upon the instruction of Transport Maschine and indeed the vehicle was sent to
the plaintiff and not Transport Maschinen as Mr Aidoo would want us to believe; hence he, Aidoo, did not
sign for Transport Maschinen but as a representative of the plaintiff and I so find.

On the repairs of this vehicle the plaintiff's representative, Tetteh, said when he took over the plaintiff's
Accra station as manager in February 1988 there were a number of vehicles undergoing repairs at the
plaintiff's workshop including the defendant's vehicle. He continued that the plaintiff repaired this vehicle
and then drew a bill which it sent to the defendant, a copy of which was tendered in evidence as exhibit B.
This was the only available evidence on the repairs; Aidoo admitted he was not present when the vehicle
was repaired. I find as a fact that the repairs were carried out by the plaintiff.

Whether the repairs were authorised by the defendant or Transport Maschinen should actually pose no
difficulty as far as payment for the work goes. For there was undisputed evidence from the plaintiff's
representative that even though the plaintiff was the service agent for Transport Maschinen in respect of
these IFA trucks, yet it was the customer, that is the owner of the vehicle, who had to pay for the servicing.
The defendant sought to lead rebuttal evidence by saying such repairs were to be done and paid for under a
warranty and I shall return to this in a moment. But the relevance of the plaintiff's representative's testimony
is that it only knew one customer and not Transport Maschinen when it came to payment for servicing done
on IFA trucks. Be that as it may, the existence of a job card duly executed by the parties meant that the
vehicle owner had agreed to pay for the repairs which he had specified to be done by the plaintiff. I find as a
fact that the defendant was to pay for the cost of repairs.

Now to the warranty. It was part of the defendant's case that [p.671] Transport Maschinen were "liable
under warranty to pay for the said repairs." The details of the nature of the warranty in so far as it affected
repairs were not given in the evidence except that gathered here and there one could only say the defendant
was entitled to free servicing for a certain number of kilometers and to free repairs if the defect was found
to be that of the manufacturer. A warranty, as defined by Sutton and Shannon on Contract (6th ed) at p 86:

"is a term of the contract which is collateral to the main purpose of the contract, ie which is not so vital as
to effect a discharge of the contract, if the circumstances are, or become inconsistent with it."

See the following cases: Oscar Chess Ltd v Williams [1957] 1 All ER 325 at 327-328, CA per Denning LJ and
Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 2 All ER 65 at 67, CA per Denning MR on
the true meaning of warranty. For a warranty to be enforceable against a party, there must be proof of an
existing contract to which he is a party and of which the warranty forms a part; where no contract exists at
all you cannot talk of a warranty. Hence in the case of Finnegan v Allen [1943] KB 425 at 430, CA per Lord
Greene MR, it was said that "Warranty is something collateral or incidental to some contract, but in this case
there is no contract alleged to which it is incidental or collateral." In the instant suit, there is no contract of
sale of IFA trucks between the plaintiff and the defendant; there is also no after sales service contract
between them. The connection which the defendant seeks to rely upon against the plaintiff is that the
plaintiff is the service agent for Transport Maschinen. But I think the defendant cannot rely on the
relationship between the plaintiff and Transport Maschinen since it is not a party to it. And also whatever
warranty was given the defendant by Transport Maschinen, if any, was enforceable against only Transport
Maschinen. Much as the plaintiff could not compel the defendant to bring the IFA vehicle to it (the plaintiff)
for servicing under the warranty the defendant had with Transport Maschinen, the same way the defendant
could not compel the plaintiff to service or repair its IFA truck under the said warranty. In short, I hold that in
the absence of any contract between the plaintiff and the defendant, there can be no talk of a warranty
between them, let alone an enforceable one. Thus if the vehicle was to be repaired under a [p.672] warranty
it only entitled the defendant to compel Transport Maschinen to pay for any repairs carried out under the
warranty or to reimburse the defendant for the same reason. But the warranty does not entitle the
defendant to refuse to pay for work done by a third party like the plaintiff herein who was not advised to
carry out the repairs under a warranty.

It is my holding that the defendant having taken his vehicle to the plaintiff to repair, had accepted to pay for
it. I therefore enter judgment for the plaintiff to recover the sum of ¢4,093,382.91 from the defendant plus
interest at the prevailing bank rate from 14 April 1988 to the date of judgment. I award costs of ¢500,000 to
the plaintiff.

DECISION

Judgment for the plaintiff.

JNNO

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