Supreme Court sets aside N5m damages against GE

The Supreme Court has set aside a $5million damages awarded to a firm, Q Oil and Gas Services Limited against GE International Operations (Nig.) Limited by a Rivers State High Court.

It held that the money amounted to double compensation to the respondent.

The plaintiff, Q Oil and Gas Services (respondent in the appeal), had sought a declaration that the Master Services Agreement between it and the defendant, GE International Operations (appellant), was still valid and subsisting.

The plaintiff said it was asked to provide a contract worker to the defendant, which it did by bringing an Indian expert, Mr Raja Kumar. But the defendant rejected the Indian in breach of the contract, the plaintiff said.

The plaintiff, through its lawyer Femi Falana (SAN), said the defendant’s refusal to allow it fill the vacant slot/position following its rejection of Kumar as provided in the agreement was illegal and breached the contract.

It sought $20,000 being money spent to bring Kumar to Nigeria to work for GE International; $500,000 being payment due to the claimant for five years of the contract of skilled labour provided for the defendant, and general damages in the sum of $5million for breach of contract.

On June 8, 2010, the plaintiff urged the court to enter judgment in its favour since the defendant failed to file its statement of defence and other processes within the time allowed by the court’s rules.

On September 29, 2010, the High Court granted the application and awarded all the monies the plaintiff prayed, including N35,000 as cost of the suit.

Dissatisfied, GE International, through its lawyer Adedapo Tunde Olowu, appealed to the Court of Appeal, Port Harcourt Division. The appellate court, on April 16, 2014, struck out the appeal for being incompetent “as there was no evidence that the appellant paid any fee for the filing of the appeal.”

Aggrieved by the judgment, the appellant, on June 10, 2015, appealed to the Supreme Court on seven grounds. Among the four issues raised for determination were whether the Court of Appeal was right to strike out the appeal suo moto on the ground of non-payment of filing fees; whether the lower court was right to grant the default judgment and whether the damages amounts to double compensation to the respondent.

Resolving the issues, Justice Sylvester Ngwuta, in the lead judgment, held that not all the grounds of appeal were incompetent. “One competent ground can save the appeal from being struck out as incompetent,” he held.

The Supreme Court held that the Court of Appeal was wrong to struck out the appeal due to non-payment of filing fees.

“I think it is mechanical justice to strike out an appeal on the mere fact that on the face of the process there is no endorsement relating to payment of fees. It would have been more in tune with justice to enquire from the registry whether or not the fees were paid and the appellant could be asked to satisfy the Court that the fees were paid, especially when it applied to validate the appeal, perhaps by showing evidence that the fees were paid,” Justice Ngwuta said.

According to him, the Court of Appeal could have compelled the appellant to pay the fees if it did not. “On no account should a litigant be made to suffer for the mistake of the registry as is apparent in this appeal. The order striking out the appeal is hereby set aside,” the Supreme Court held.

On the award of $5million as general damages in addition to the $520,000, the Supreme Court said the principle of restitution “is not meant to give a windfall to the respondent.”

Justice Ngwuta held that the two heads of claim ($20,000 spent to bring Kumar and $500,000 for the five-year contract) were what would restore the respondent to the position it would have been if there was no breach of contract.

“That is all the respondent is entitled to and not general damages. The $5million damages awarded to the respondent as general damages cannot stand as the respondent cannot be awarded both special and general damages for the same set of facts.

  “The $20,000 awarded as claimed ‘being money spent by the claimant in bringing Mr Raja Kumar to Nigeria to work for the defendant’ includes all the expenses in bringing the expert to Nigeria. It includes the immigration requirements.

“In conclusion, the appeal succeeds in part. I set aside the $5million awarded as general damages to the respondent. On the facts of the case, the award amounts to double compensation.”

Other justices on the panel – Mahmud Mohammed, Suleiman Galadima, Olabode Rhodes-Vivour and Musa Muhammed, all agreed with the lead judgment, which was delivered on March 18.