Hammond v. Ainooson [1974] 1 Glr 176-184

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HOME [ 1974] GHANA LAW REPORTHAMMOND v. AINOOSON [1974] 1 GLR 176-184

HIGH COURT, ACCRA

18 DECEMBER 1973

ABBAN J.

Contract—Oral—Intention to create legal relations—Parties ad idem—Services rendered by plaintiff for agreedfees at request of defendant—Acceptance of services by defendant—Contract terminated by defendant—Action by plaintiff for fees and other expenses—Whether parties intended to create enforceable contract.

Contract—Quantum meruit—Implied obligation to pay reasonable remuneration—Rule of law or inference offact.

HEADNOTES

The defendant was the owner of a fishing boat which had become unserviceable in 1965 due to damage it hadsuffered at sea. By a verbal agreement between the plaintiff and the defendant, the boat was sent to theBoatyard Corporation, Tema, for repairs and the defendant requested the plaintiff to supervise the repairs for afee of ¢3.00 a day. An attempt was made to draw up a written contract but the defendant promised to abide bythe terms whether they were reduced into writing or not. The plaintiff was to be at the Boatyard Corporationworkshop during the period of repairs and she was to purchase for the workers material needed for therepairs. The plaintiff did as was requested by the defendant until the repairs were completed in 1967. For thelaunching ceremony of the boat, the plaintiff said she bought cakes and drinks and prepared salad and thesewere used in entertaining the invited guests. After the launching, the plaintiff negotiated and obtained a fishingnet and crates of wooden boxes in which the fish to be caught would be packed and sold. The plaintiff paid forthe crates while the cost of the net was borne by the defendant. It was a term of the agreement that the plaintiffwas to sell all the fish that would be caught by the boat. However, in the course of time, following amisunderstanding between the [p.177] plaintiff and the defendant and contrary to the terms of the agreement,

the defendant employed another woman to sell the fish from the boat. All attempts made by the plaintiff to havethe matter amicably settled proved abortive; consequently the plaintiff issued a writ claiming the sum of ¢2,373.26 from the defendant for the services rendered and for work done for the benefit of the defendant.

The defendant's case was a complete denial of any agreement between him and the plaintiff. He denied thathe agreed to pay the plaintiff ¢3.00 a day or any other amount towards her daily expenses. He, however,admitted that drinks, cakes and other things were bought by the plaintiff for the launching ceremony, but statedthat he did not ask the plaintiff to buy them. The trial judge found as a fact that the plaintiff agreed to supervisethe repair works for a fee of ¢3.00 a day, until the completion of the said repairs; that the parties agreed that theplaintiff was to sell all the fish that would be brought in by the boat and that it was the defendant who terminatedthe said agreement.

Held: there was a contract between the parties resulting in legal obligations which could be enforced. Even inthe absence of such a contract the plaintiff would have been able to recover in quantum meruit. In thecircumstances, the defendant was liable to pay the agreed fee of ¢3. 00 a day for the plaintiff 's out of pocketexpenses for the whole period when the boat was under repair. The defendant was also liable to refund thecost of the wooden boxes as well as the cost of the drinks and the food items bought by the plaintiff for thelaunching ceremony of the boat.

Obiter. Where a person had rendered services in pursuance of a transaction, supposed by him to be acontract, but which in truth was without legal validity, he could recover for the value of his services in quantummeruit. The implied obligation to pay reasonable remuneration was an obligation imposed by law and not aninference of fact arising from the performance and acceptance of the services. Dicta of Greer L.J. in Craven-Ellis v. Canons, Ltd. [1936] 2 K.B. 403 at p. 410, C.A. and of Lord Wright in Way v. Latilla [1937] 3 All E.R. 759at p. 765, H.L applied. Scarisbrick v. Parkinson (1869) 20 L.T. 175 and Lawford v. Billericay Rural DistrictCouncil [1903] 1 K.B. 772, C.A. cited.

CASES REFERRED TO

(1) Scarisbrick v. Parkinson (1869) 20 L.T. 175; 17 W. R. 467.

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(1) Scarisbrick v. Parkinson (1869) 20 L.T. 175; 17 W. R. 467.

(2) Craven-Ellis v. Canons, Ltd. [1936] 2 K.B. 403; [1936] 2 All E.R.1066; 105 L.J.K.B 767; 155 L.T. 376; 52T.L.R. 657; 80 S.J.652, C.A.

(3) Lawford v. Billericay Rural District Council [1903] 1 K.B. 772; 72 L.J.K.B. 554; 88 L.T. 317; 67 J.P. 245; 51W.R. 630; 19 T.L.R. 322; 47 S.J. 366; 1 L.G.R. 535, 89 C.A.

(4) Way v. Latilla [1937] 3 All E.R. 759; 81 S.J. 786, H.L.

NATURE OF PROCEEDINGS

ACTION by the plaintiff for ¢2,373.26 from the defendant for services rendered and for work done for the benefitof the defendant. The facts are sufficiently stated in the judgment.

COUNSEL

E. M. A. Ablorh (with him Dussey) for the plaintiff.

S. A. Okudzeto for the defendant.

[p.178]

JUDGMENT OF ABBAN J.

The plaintiff is claiming the sum of ¢2,373.26 from the defendant for services rendered and for work done forthe benefit of the defendant.

Some time in 1965, the plaintiff was introduced to the defendant as the person whose fishing boat had becomeunserviceable due to damage it had suffered at sea. The parties became friendly after the said introduction,and the defendant requested the plaintiff to find someone to finance the repairs of the said boat. The plaintiffsaid she recommended one Miss Epton, but that lady was unable to undertake the repairs. The defendanteventually decided to find money himself for the repairs. The boat was sent to the Boatyard Corporation, Tema,and the defendant requested the plaintiff to supervise the repairs. That is, the plaintiff was to be at the BoatyardCorporation workshop during the period of repairs, and she was to purchase for the workers materials neededfor the repairs and which could not be obtained from the corporation's own store.

The plaintiff deposed that she was at that time selling fish at Narkwa Fisheries, Tema, and she agreed toundertake that kind of supervision on condition that the defendant paid her some allowance to cover her dailyexpenses. In the presence of witnesses, the first and second witnesses for the plaintiff, the matter was furtherdiscussed. The plaintiff asked for, ¢4.00 a day, but the defendant beat it down to ¢3.00 which was accepted bythe plaintiff. The plaintiff alleged that it was also agreed that she was to sell all the fish which would be caughtby the boat and that after the cost of the repairs and all other incidental expenses had been defrayed from theproceeds of the sale of the fish, the profits which would be realized would be shared equally between them.

Following this agreement the plaintiff and the defendant went to see the director of the Boatyard Corporation atTema, and obtained from him the estimated cost of repairs. The defendant then instructed the said corporationto carry on with the repairs which were completed in March 1967, and the launching ceremony was performedin grand style. The plaintiff said she bought cakes and drinks and prepared salad and these were used inentertaining those invited to the launching ceremony. After the launching, the plaintiff negotiated and obtained afishing net and crates of wooden boxes in which the fish to be caught would be packed and sold. The plaintiffpaid for the crates while the cost of the net was home by the defendant.

After the plaintiff had recruited fishermen to man the boat, the boat was put to sea, and soon it started bringingin fish. The plaintiff sold the fish and accounted for the proceeds of the sale to the defendant who, at thematerial time, was residing at Cow Lane, Accra. After the plaintiff had sold the fish for some time, troublebegan to rear its ugly head. All the fishermen the plaintiff employed on the boat came from [p.179] Winneba,except the captain who was a native of Elmina. The fishermen, for an unknown reason, insisted that the plaintiffshould dismiss the captain from the boat and employ someone from Winneba in his place.

The plaintiff refused to countenance this tribalistic suggestion, and surprisingly, the fishermen took the boat toWinneba. This incident was reported to the defendant but because the defendant, from all indications, was insupport of the move made by the fishermen, he did not do anything about it. Contrary to all expectations and tothe terms of the agreement, the defendant employed another woman to sell fish from the boat. All attemptsmade by the plaintiff to have the matter amicably settled proved abortive. The plaintiff, in the circumstances,had to resort to the present action.

The evidence of the plaintiff's first and second witnesses, shows that they were present when the terms of thecontract were agreed upon by the parties. Mr. Aidoo, the plaintiff's fourth witness and Mr. Bampoe, theplaintiff's fifth witness, were employees of the Boatyard Corporation at the time the repairs were being carried

out by the corporation. Mr. Aidoo was the yard superintendent, while Mr. Bampoe was the supervisor of boatbuilding. These two gentlemen confirmed that the plaintiff was present at their workshop throughout the periodof repairs and supplied them with spare parts whenever she was called upon to do so.

The defendant's case is a complete denial of any agreement between him and the plaintiff. He averred that thefishing boat was formerly at Takoradi and he decided to bring it down to Tema. But when it got to the shores ofApam it was damaged and a certain woman, called Araba Nana, caused it to be towed to the Tema BoatyardCorporation. This Araba Nana suggested to the defendant to allow the plaintiff to take over the repairs of theboat. At first the defendant did not agree to the suggestion. But after the plaintiff had called on him on anumber of occasions the defendant said he gave in. He then took the plaintiff to the Boatyard Corporation and

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number of occasions the defendant said he gave in. He then took the plaintiff to the Boatyard Corporation andintroduced her to the managing director of the corporation, and at the same time authorised the corporation torepair the boat.

The defendant said when the repairs were about to start the managing director of the corporation contacted theplaintiff about payment of a deposit. The plaintiff, in turn, went to the defendant in Accra who gave her ¢2,000.00 to be paid to the corporation. The defendant contended that it was at that stage that he asked theplaintiff whether she was prepared to sell the fish which would be brought in by the boat, and the plaintiff repliedin the affirmative. The defendant maintained that apart from that question and answer he did not agree to paythe plaintiff ¢3.00 a day or any other amount towards her daily expenses. He did not also agree to share theprofits from the fishing business with the plaintiff. He, however, admitted that drinks, cakes and other things[p.180] were brought to the launching ceremony by the plaintiff, but said that he did not ask the plaintiff to buythem. He also denied that the plaintiff paid for the crates.

He further contended that the plaintiff sold fish from the boat but failed to make proper account to him andengaged in quarrels with the fishermen employed on the fishing boat. As a result, the fishermen refused toentertain the plaintiff near the boat. In order to prevent trouble, the defendant said he told the plaintiff to settlethe quarrel with those fishermen and until that was done, she was to keep away from the boat. To thedefendant, it was the fishermen who dismissed the plaintiff from the boat, and so far as the defendant wasconcerned, the plaintiff was reimbursed for any expenses which she might have incurred in connection with theboat and there was no basis for this action.

Only two issues were agreed upon, namely, (a) whether or not the plaintiff supervised the repair of thedefendant's boat and rendered other services to the defendant to the knowledge and approval of the defendant,and (b) whether or not the plaintiff is entitled to the reliefs sought. I think issue (a) is the only important issue inthis case. But before determining that issue it is necessary that I should decide certain subsidiary matters. One of them is whether the parties ever entered into any agreement concerning the fishing boat.

I find, from the evidence, that it was the practice in those days that during repairs of any fishing boat by theBoatyard Corporation, the owner of the said boat or his authorised representative should constantly visit theworkshop of the corporation to see the progress of the repair work. He must be close at hand so that he couldbe called upon to furnish spare parts, if necessary, and especially where those parts were not available in thecorporation's own store. That practice was necessary to avoid undue delays. This practice of watching theprogress of the repairs and supplying spare parts, where necessary, was what the plaintiff and her witnessesloosely termed supervision of repairs."

I am satisfied that the defendant knew of this practice, and that was why he requested the said Araba Nana tofind someone who could undertake that kind of supervision work. I find that the plaintiff agreed to do the so-called supervisory work and the defendant agreed to pay her an allowance of ¢3.00 a day, until the completionof the repairs by the Boatyard Corporation. The plaintiff is not a relative of the defendant and until they were

introduced to each other by Araba Nana, they had not previously met anywhere.

Learned counsel for the defendant, in his address, conceded that the plaintiff is not a charitable institution to goround gratuitously to supervise the repair of other persons' boats at the Boatyard Corporation. I reject thedefendant's evidence that there was no agreement to pay the plaintiff ¢3.00 a day. I think it was in pursuanceof this [p.181] particular term of the agreement that when the repairs began, the plaintiff discontinued her workat Narkwa Fisheries where she was earning an appreciable income for her living.

I also find that the parties agreed that the plaintiff was to sell all the fish that would be brought in by the boat andshe was to share equally with the defendant the profits from the fishing business after all the expenses incurredon the repair work had been fully liquidated. The plaintiff was anxious that the terms of the agreement should beembodied in writing. So both the plaintiff and the defendant went to see a lawyer. But the defendantsuccessfully persuaded the plaintiff to discard the idea of having a formal document drawn up since, to thedefendant, that was not necessary.

The defendant assured the plaintiff that whether a written agreement was executed by them or not, he wouldstrictly abide by every term of the agreement. In further pursuance of the said agreement, the defendant tookthe plaintiff to the Boatyard Corporation, Tema, and introduced her not only to the workers who wereundertaking the repairs, but also to the managing director of the corporation, as his lawful representative. Thedefendant specifically directed the said manager to refer all matters connected with the repairs to the plaintiff. In fact the defendant asked the manager to pass through the plaintiff all reports or messages intended for thedefendant; and that was why the deposit of ¢2,000.00 required to be paid by the defendant, was paid by himthrough the plaintiff.

The plaintiff was called upon on some occasions to provide certain spare parts, such as a winch, which couldnot be obtained from the corporation's store. The plaintiff was living at Tema and she had to travel to Takoradi,Accra, and other places at her own expense, in search of those spare parts.

Furthermore, I am convinced that the plaintiff bought 1,000 wooden fish boxes at 40 pesewas each to be usedon the boat; and on the day the boat was launched, she prepared salad, bought cakes and all types of drinks,including whisky, schnapps, champagne, liqueur and akpeteshie, to mention a few. The defendant went to theplaintiff's house and collected the drinks, the cakes and the salad in his car and sent them to the launching sitewhere they were used in refreshing the invited guests. After the ceremony, the defendant collected the leftoversand sent them away. The defendant said, under cross-examination, that he was not keen about the leftoversbut the plaintiff forced them on him. I think that is not true. He voluntarily took them away to his house andthoroughly enjoyed them.

In my view, the plaintiff did all that was expected of her under the said agreement, and at the time the plaintiff leftthe fishing boat the expenses she had incurred in connection with the boat, including the cost of the wooden fishboxes, drinks and the food items, had not been refunded to her; neither had the defendant paid the plaintiff the

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boxes, drinks and the food items, had not been refunded to her; neither had the defendant paid the plaintiff theagreed allowance of ¢3.00 a day or any part thereof.

[p.182]

I will now consider whether it was the defendant who unlawfully brought the agreement to an end or it was thefishermen who made it impossible for the agreement to continue. The defendant's evidence that it was thefishermen who dismissed the plaintiff from the boat must be taken with a pinch of salt. After all, it was theplaintiff who originally employed those fishermen and they were under her control. I do not therefore see howthose men could have had the audacity to dismiss the plaintiff from the boat if the defendant himself had not

collaborated with them. It seems to me that after the plaintiff had sold fish from the boat for about one month,the defendant, for reasons best known to himself, made up his mind to terminate the agreement with theplaintiff.

He therefore cunningly used the little misunderstanding that had cropped up between the plaintiff and thefishermen, as the opportunity to get rid of the plaintiff. If that was not the intention of the defendant, why did henot call the fishermen to order or relieve them of their duties when they were making that unreasonabledemand? The defendant, instead, sided with the fishermen against the plaintiff who had done so much to getthe fishing boat back to sea. The defendant's insistence that the plaintiff should not go near the boat so long asthe so-called dispute with the fishermen had not been settled, to say the least, was most unreasonable.

The defendant wants this court to believe that those fishermen had greater control over the affairs of the boatthan the defendant himself, and that whatever those men said was final and nothing could be done about it. Ithink it was the defendant who unlawfully prevented the plaintiff from selling fish from the boat, and eventuallydismissed her from the boat in direct breach of the terms of the agreement. Indeed, by the time the boat wastaken to Winneba the defendant had already employed another woman to sell fish from the boat.

In my opinion, the defendant broke the agreement. Without justification he prematurely brought the agreementto an end. As already stated, the agreement was that all the expenses to be incurred by the plaintiff and theallowance of, ¢3.00 a day, payable to the plaintiff to cover her daily expenses while the boat was under repairs,as well as the expenses which the defendant would also incur, including the cost of the repairs, were all to besettled out of the proceeds of the sale of fish which would be brought in by the boat. The plaintiff, as I havefound, had not been paid anything at the time she was compelled to leave the boat and the defendant musttherefore be called upon to meet the plaintiff's claim.

It was seriously submitted by learned counsel for the defendant that, on the evidence, there was no agreementsufficiently certain or definite to be enforced so far as the payment of the allowance of ¢3.00 was concerned. Learned counsel contended that the arrangement, about the payment of the ¢3.00 a day, even if it is true,cannot amount to a contract which can be enforced, because the parties did not intend that it should beattended by legal consequences.

[p.183]

With respect to learned counsel, I hold the opposite view. If the parties did not intend their agreement to resultin legal obligations which could be enforced, why did they, after they had agreed on all the terms and they weread idem attempt to have the terms incorporated in a formal document by a legal practitioner, Dr. de GraftJohnson? The idea of drawing up that document was finally dropped because the defendant promised toabide and to be bound by the terms of the agreement, whether the said terms were put down in writing or not.

In any case, even if I had found that there had been no concluded and enforceable agreement between theparties as to the amount of allowance the plaintiff was to receive for her services during the time the boat wasunder repairs, or for the other consideration supplied by her, I would still have held that the plaintiff could recoveron quantum meruit basis for the value of the benefit she conferred on the defendant and the defendantaccepted. The principle is that where a person rendered services in pursuance of a transaction, supposed byhim to be a contract, but which in truth, is without legal validity, he can recover for the value of his services inquantum meruit. In Scarisbrick v. Parkinson (1869) 20 L.T. 175, the plaintiff served the defendant as clerk andthe court held that the plaintiff was entitled to recover on a quantum meruit although the contract, under which hewas supposed to have performed his services, was unenforceable by reason of the Statute of Frauds; and thecourt looked at the supposed agreement to enable the court to assess the amount payable.

The implied obligation to pay reasonable remuneration is an obligation imposed by law and not an inference offact arising from the performance and acceptance of the services: see Craven-Ellis v. Canons, Ltd. [1936] 2K.B. 403, C.A. The plaintiff in that case was appointed managing director of a company under the company'sseal which also provided for remuneration. By the articles of association of the company each director wasrequired to obtain his qualification shares within two months after appointment. Neither the plaintiff nor theother directors obtained their qualification shares within two months or at all. The plaintiff having done work forthe company claimed to recover the remuneration provided for by the agreement, or alternatively, on the basisof a quantum meruit. The Court of Appeal held that the agreement was void, since the persons purporting to actas directors had no authority and could not bind the company, and the claim in contract must therefore fail. Butas the services had in fact been rendered whereby the company had benefited, the alternative claim on aquantum meruit ought to succeed, Greer L.J. in delivering his judgment at p. 410, said:

"This would certainly be strictly logical if the inference of a promise to pay on a quantum meruit basis were aninference of fact based on the acceptance of the services or of the goods [p.184] delivered under what wassupposed to be an existing contract; but in my judgment the inference is not one of fact, but is an inferencewhich a rule of law imposes on the parties where work has been done or goods have been delivered underwhat purports to be a binding contract, but is not so in fact."

See also Lawford v. Billericay Rural District Council [1903] 1 K.B. 772, C.A. and Way v. Latilla [1937] 3 All E.R.759 at p. 765, H.L. per Lord Atkin. In the latter case, at p. 765 of the report, Lord Wright also had this to say:

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759 at p. 765, H.L. per Lord Atkin. In the latter case, at p. 765 of the report, Lord Wright also had this to say:

"It is, however, clear, on the evidence, that the work was done by the appellant and accepted by the respondenton the basis that some remuneration was to be paid to the appellant by the respondent. There was thus animplied promise by the respondent to pay on a quantum meruit, that is, to pay what the services were worth."

In the circumstances, I hold that the defendant is liable to pay the said ¢3.00 a day to cover the plaintiff's out ofpocket expenses for the whole period when the boat was under repairs at the Boatyard Corporation. Thedefendant is also liable to refund the cost of the wooden fish boxes amounting to ¢400.00. The cost of thedrinks and the food items, on the plaintiff's evidence, which I accept, amounted to ¢76.54. The repairs on theboat commenced on 15 July 1965, and were completed on 13 March 1967. That is, the repairs covered aperiod of 606 days; and for those days the plaintiff ought to have been paid ¢1,818.00. Consequently, theplaintiff will recover from the defendant the grand total of ¢2,294.54.

Judgment will therefore be entered and is hereby entered for the plaintiff for the sum of ¢2,294.54, with costs of¢500.00 inclusive.

DECISION

Judgment for the plaintiff.

S. E. K.

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Hammond v. Ainooson [1974] 1 Glr 176-184

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