Wakilii

Eber v Thomsen (C.A. 1-1935)

East African Court of Appeal · [1935] EACA 34 · 1935 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from Supreme Court of Kenya judgment awarding damages for breach of agency contract
Decision
Judgment of the Supreme Court affirmed awarding respondent Sh. 21,988/87 including Sh. 20,000 damages for breach of contract

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court held that the respondent was justified in treating the appellant's conduct as anticipatory breach of contract and suing for damages. Where the principal threatened to dispense with the agent's services unless he accepted reduced commission, and the principal intended to continue trading in the relevant products, the agent was entitled to damages. Even if the agent had been guilty of misconduct, such misconduct had been condoned by the principal's failure to dismiss him at the time. The agent was also entitled to commission on goods ordered through a lawful arrangement, even though the manufacturer ultimately refused to supply them.

Outcome

Judgment of the Supreme Court affirmed awarding respondent Sh. 21,988/87 including Sh. 20,000 damages for breach of contract

Facts

The appellant, a German merchant in Hamburg, appointed the respondent, a merchant in Mombasa, as his sole agent for five years from 1 January 1932 to sell oil products in Kenya, Uganda and Bukoba District on 7.5% commission. After the contract was concluded, the appellant pressed the respondent to accept reduced commission rates (as low as 2.5%) and threatened to dispense with his services if he refused. The appellant's representative filed an affidavit stating the appellant had no intention of abandoning trade in Kenya and was making arrangements to continue business, including negotiating with other merchants. The respondent elected to treat this as repudiation of the contract and sued for damages. The appellant pleaded that the respondent had been guilty of negligence and misconduct which would have entitled dismissal, and that as the appellant was not bound to import goods, no damages were payable. The Supreme Court entered judgment for the plaintiff for Sh. 21,988/87 including Sh. 20,000 damages.

Issues

  1. Whether the respondent was justified in bringing an action for damages for anticipatory breach of contract.
  2. Whether the respondent was entitled to damages where the appellants were not bound to import any goods but intended to continue trading.
  3. Whether alleged misconduct by the respondent disentitled him from succeeding in his claim.
  4. Whether the respondent was entitled to commission on leopard traps ordered but not supplied by the manufacturer.

Orders

  • Appeal dismissed.
  • Costs of the appeal to the respondent.
  • Cross-appeal withdrawn by consent with no order as to costs.
  • Judgment of the Supreme Court affirmed.

Rules and key headnotes

Principal and Agent — Anticipatory Breach — Right to Sue for Damages
Where a principal threatens to dispense with an agent's services unless the agent accepts materially altered terms, and the principal intends to continue trading in the relevant products, the agent is entitled to treat this as anticipatory breach of contract and sue for damages.
Principal and Agent — Damages — Entitlement Where Principal Continues Trading
An agent remunerated by commission is entitled to damages for breach of a fixed-term agency contract where the principal, though not bound to import any specific quantity of goods, intends to continue trading in the relevant products and to conduct that business without the agent.
Principal and Agent — Misconduct by Agent — Condonation
Where a principal, with knowledge of alleged misconduct by an agent, takes no action to dismiss the agent at the time, the misconduct is condoned and the principal cannot subsequently rely on it to justify termination of the agency or to defeat the agent's claim for damages.
Agency — Commission — Entitlement on Failed Transaction
Where an agent arranges a sale through a lawful circuitous route to avoid territorial restrictions, and the transaction fails through no fault of the agent because the manufacturer refuses to supply, the agent is entitled to the agreed commission on the order placed.

Cases cited (5)

  • Turner v Goldsmith [1891] 1 QB 544
  • Reigate v Union Manufacturing Co [1918] 1 KB 592
  • Phillips v Foxall (1871-72) 7 QB 666
  • Rhodes v Forwood (1876) 1 AC 256
  • Imperial Tobacco Co of India v Bonnan [1924] AC 755

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Eber v Thomsen (C.A. 1-1935) [1935] EACA 34 (1 January 1935)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.