DACHEL & COMPANY LIMITED v. FRIESLAND FRICO DOMO (now known as FRIESLAND FOODS)

ADINYIRA (MRS), JSC:

This is an appeal from the judgment of the Court of Appeal delivered on 4 February 2011 affirming the judgment of the High Court Accra dated 7 March 2001 entered in favour of the Plaintiff /Respondent / Respondent (hereinafter referred to as the Plaintiff) against the Defendant/Appellant/Appellant (hereinafter referred to as the defendant).

The real issues in this appeal border on the lapse in procedure in Order 2 r.4 of the High Court (Civil Procedure) Rules, 1954 (LN 140A ) and the award of compensation for termination of an agency agreement. The facts of the case narrated in this opinion would therefore be centred on what relates to these issues.

The Plaintiff a company incorporated under the laws of Ghana was in 1978 appointed, in terms of an agency agreement Exhibit A, the sole agent in Ghana of the branded products of Pierson Munier & Company (PMC), a company incorporated under the laws of the United Kingdom. In 1980, the Defendant took over PMC and retained the Plaintiff as its agent. The parties executed a document, Exhibit B, dated 31 July 1980, by which Exhibit A was varied by changes in the brand name of products named in the agreement and by the introduction of a 90 day written notice requirement for the termination of the agreement. Mr. Hendrik Anno Vanderveen a legal adviser to the defendant company who represented the Defendant at the hearing admitted in cross-examination that Exhibit A was validated by the Defendant. Some of the branded products were Peak Milk, Dutch Baby Food and Frisolac. According to the Plaintiff, it was a clear understanding of the parties that their relationship was to be governed not only by the Agency Agreement but by the customs, practices, and regulations of the European Community, England and /or Holland.

The defendant terminated the agency agreement in January 1994 by giving the plaintiff the requisite 90 days notice and offered the latter and amount of NLG 120,000 (equivalent of $70,000) as compensation. The plaintiff was dissatisfied with the termination of the agreement and rejected the quantum of compensation for the reason that it had promoted and expanded and established a thriving market in Ghana for the brand products of the defendant. The plaintiff contended that by the termination of the agreement it has been deprived of the opportunity to reap the benefits of the programs and market strategies it had put in place while expenses on same stood unpaid.

After attempts at settleme