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ISSUES:
Whether or not the Defendant in their role of Agents could be held liable for the actions of their
Principal (Japanese Corporation)?
Whether or not in the current situation, the Defendants could assume liability as Principals?
What is the nature and quantum of damages available to the Plaintiff if proven that her claim is
justified?
RATIO DECIDENDI
OLLENU J:
The Learned Judge first of all establishes that the Defendant, being the sole distributor of the
products manufactured by the Corporation, were and could only be sued as / in their capacity as
Agents.
In respect of the defense argument that the Defendants as Agents could not be sued as they had
no rights or liabilities and also that the Principals being disclosed and the fact that the Plaintiff
averred that she would deal with them directly, the Learned OLLENU J states that when a
question is raised as to the nature or the legal position of an agent , the determination is based on
ascertaining the specifics facts of each situation, and asserting the intention of the parties as at
the time they were contracting. Thus on the facts, Justice OLLENU argues that the woman being
an illiterate, it couldnt be held that she intended contracting with a corporation far away in
Japan, but instead was solely focused on the defendants as the other party responsible for the
discharge of their contractual relationship.
In relation to the Defenses argument that the Plaintiff was estopped from suing the Defendant as
she had taken upon herself to resolve the matter with the Overseas Corporation through her
bankers, OLLENU J relies on the decision in the case of DRAMBURG & Another v
POLLITZER ((1873) 28 L.T.R. N.S. 470), where it was held that an order placed with, and
accepted by, an agent of foreign manufacturers formed a contract between the customer and the
agent. It was further held that a letter written by the customer to the foreign manufacturers, after
a breach of that contract had been committed, did not constitute an election by the customer to
treat the manufacturers as principals.
Thus based on the evidences gathered above, OLLENU J finds that the Defendants failed to
discharge their duty according to the sample-quality requirement expressed by the Plaintiff and
that the quantum of damages be the difference between the market price fetched by the poor
quality goods and the market price for the good sample-quality, prevailing at the time (Peterson
v. Ayre (138 E.R. (C.P.) 1235)).