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Damages – Negligence – Chattel –
Total wreck of, – No evidence of
value of salvage – Plaintiff
entitled to value of chattel as
at accident date – Defendant
entitled to wreck.
Damages – Negligence – Chattel -
Loss of use – Plaintiff not
entitled to damages for loss of
use when action in court.
Damages – Loss of use - Interest
– Interest may be awarded on
loss of use from accrual of
cause of action to date of
judgment.
Interest –
Judgment – Rate – Damages for
negligence resulting in total
wreck of chattel – 4% interest
exigible from date of judgment –
Order 42 r 15 High Court (Civil
Procedure) Rules 1954 (LN 140A),
Courts (Award of Interest)
Instrument 1984 (LI 1295).
The trial High Court judge
entered judgment against the
defendants for negligent damage
of the plaintiff’s car and
awarded the plaintiff ¢350,000
as the value of the damaged car,
¢300 per day for 14 days as loss
of use and also interest on the
award at the prevailing bank
rate of interest from date of
the cause of action to the date
of payment. On appeal,
Held:
(1) The plaintiff stated that
his vehicle was a total wreck
and gave the value of his
vehicle as at the time of the
accident as ¢350,000. In the
absence of any evidence to the
contrary, the judge was entitled
to award the plaintiff the value
of his vehicle as at the time of
the accident. In that case the
defendants would be entitled to
the wreckage.
(2) Despite the fact that the
plaintiff was unable to get
himself a new car or an
alternative means of transport
within the 14 days, since he had
claimed for the full value of
his car, he was not entitled to
loss of use for the period when
the action was in court.
(3) Since the assessment for
loss of use remained unpaid up
to the date of judgment, it
attracted interest from the date
the cause of action arose to the
date of payment. The plaintiff
was therefore entitled to
interest on the amount from the
date the cause of action arose.
Royal Dutch Airlines (KLM) v
Farmex Ltd [1989-90] 2 GLR
623, SC cited.
(4) By Order 42 r 15 every writ
of execution for the recovery of
money should be indorsed with a
direction to levy the amount due
and interest, if sought to be
recovered, at the rate of £4%
per annum from the date of the
judgment or order. Where there
was an agreement between the
parties for a higher rate of
interest, then the indorsement
may be for such rate. The rule
did not forbid the levy of
interest above £4%. It only
required that the higher rate
should have been agreed upon. As
the parties had not agreed on a
higher rate of interest, the
trial judge erred in making his
award. The plaintiff would be
entitled to interest on the
amount awarded him from the date
the cause of action arose to the
date of judgment i.e 18/1/89. As
from the date of judgment, the
plaintiff would be entitled to
the interest provided in Or 42 r
15. Re European Central Ry
(1877) Ch D 33, ex
p Fewings (1883) 25 Ch D
338, Arbuthnot v Bunsilall
(1890) 62 LT 234, Economic
Life Assurance Society v Usborne
[1902] AC 147 cited.
Cases referred to:
Arbuthnot v Bunsilall
(1890) 62 LT 234.
Economic Life Assurance Society
v Usborne
[1902] AC 147.
European Central Ry, Re
(1877) Ch D 33.
Fewings,
Ex p (1883) 25 Ch D 338.
Royal Dutch Airlines (KLM) v
Farmex Ltd
[1989-90] 2 GLR 623, SC.
APPEAL against award of damages
by the High Court.
Asumadu Mensah
for the appellants.
Brown
for the respondent.
AMPIAH JA.
The plaintiff in this action
sued the defendants at the High
Court, Accra for loss of use and
damages resulting from the
negligent driving of the 1st
defendant, the driver of the 2nd
defendant's vehicle on 2 April
1982. The defendants denied
liability. On 18/1/89, the
learned trial judge gave
judgment for the plaintiff and
awarded him ¢350,000 being the
cost of the Opel car, ¢300 per
day as loss of use for 14 days
and interest on the total claim
at the prevailing rate of
interest to be calculated from
16 April 1982 till the date of
final payment. He awarded the
plaintiff costs of ¢12,000. The
defendants have appealed against
the judgment on the grounds that
(a) the damages and interest
awarded were excessive, (b) the
judge erred for refusing to take
into account the salvage value
of the car in assessing the
damages. No additional grounds
were filed.
In arguing the appeal, counsel
for the defendants who did not
seem to dispute the award of
interest in the circumstances,
submitted that:
(i) Even though on the evidence
the plaintiff's vehicle was a
total wreck, it was necessary
for the plaintiff to prove the
value of what was left of the
car so as to determine the
amount to be given for the
replacement value.
(ii) Since the learned trial
judge found that 14 days was a
reasonable period within which
the plaintiff could have found
himself a new car, interest up
to only 14 days should have been
awarded.
(iii) The interest awarded could
not go beyond the date of
judgment.
(iv) The interest awarded should
start, if at all, from the date
of the issue of the writ to the
date of judgment and not more.
He concluded that the learned
trial judge failed to consider
these matters and therefore
arrived at a wrong assessment of
the damages.
Counsel for the plaintiff
supported the basis for the
assessment of the damages. He
said in conclusion that he found
no merit in the appeal and that
it should be dismissed. He
argued that interest awarded
should start from the date of
the accident when the cause of
action arose, to the time the
amount awarded was finally paid.
The plaintiff gave the value of
his vehicle as at the time of
the accident. He stated that his
vehicle was a total wreck. There
was no suggestion by him of the
probable value of the wreckage.
In the absence of any evidence
to the contrary, I think the
judge was entitled to award the
plaintiff the value of his
vehicle, as at the time of the
accident. The ¢350,000 awarded
the plaintiff, as the value of
his vehicle was therefore
supportable. It means however
that the defendants would be
entitled to the wreckage.
The learned trial judge awarded
the plaintiff ¢300 per day for
loss of use for 14 days. This
period he considered reasonable
as the period within which the
plaintiff could have procured
himself a new car. Despite the
fact that the plaintiff was
unable to procure a new car or
an alternative means of
transport within the 14 days,
since he had claimed for the
full value of his car, he was
not entitled to loss of use for
the period when the action was
in court. It is now accepted
that impecuniosity is not a
basis for the assessment of
damages of this kind.
The judge awarded interest on
the loss of use. Counsel for the
appellants has contended that if
interest was exigible at all, it
should be for the period of 14
days. This may well be so if the
amount had been paid within the
14 days, but since that amount
remained unpaid up to the date
of judgment, it attracted
interest from the date the cause
of action arose. The fourteen
days period was used only for
the assessment of damages
recoverable for loss of use.
I am satisfied on the
authorities that since damages
are awarded as at the time of
the accident, whatever interest
is awarded must also have
reference to that date. The
rationale behind the award of
interest, in my view, is that if
payment of damages including the
cost of the vehicle had been
made at the time of the
accident, the victim would have
been able to utilize the amount.
Since the amount was not paid at
that time, the victim would be
entitled to interest i.e. what
he would have earned on the
amount if it had been paid and
had been deposited in the bank.
The plaintiff was therefore
entitled to interest on the
amount as from the date the
cause of action arose. The award
of interest is supported by the
Courts (Award of Interest)
Instrument 1984 (LI 1295). See
also the case of Royal Dutch
Airlines (KLM) v Farmex Ltd
[1989-90] 2 GLR 623, SC.
In the instant case the judge
awarded interest “up to the time
of final payment.” Was he right?
Order 42 rule 15 reads:
“Every writ of execution for the
recovery of money shall be
indorsed with a direction to the
Sheriff, or other officer or
person to whom the writ is
directed, to levy the money
really due and payable and
sought to be recovered under the
judgment or order, stating the
amount, and also to levy
interest thereon, if sought to
be recovered, at the rate of £4
per cent per annum from the time
when judgment or order was
entered or made, provided that
in cases where there is an
agreement between the parties
that more than £4 per cent
interest shall be secured by the
judgment or order, then the
indorsement may be accordingly
to levy the amount of interest
so agreed.”
A note on this rule in the
Annual Practice (1948 ed)
page 793 or (1962 ed) p 1011
reads:
“Rate of Interest: –– A contract
to pay the debt with interest
at, e.g. £10 per cent does not
entitle a plaintiff to levy
under his execution more than
the statutory interest of £4 per
cent. The contract (or a
subsequent agreement) must state
specifically that any judgment
obtained for recovery of the
debt shall carry interest (e.g.)
£10 per cent and the higher rate
of interest should form part of
the judgment; See Re European
Central Ry (1877) Ch
D 33; Ex p Fewings (1883)
25 Ch D. 338; Arbuthnot v
Bunsilall (1890) 62 LT 234;
and see Economic Life
Assurance Society v Usborne
[1902] AC 147.”
Order 42 r 15 does not forbid
the levying of interest above
4%. It only requires that the
higher rate should have been
agreed upon by the parties.
Similarly, the note in the
Annual Practice agrees that
any different rate should be the
subject of agreement between the
parties. In the instant case
there was neither a contract nor
agreement to pay a higher rate
after the judgment. Upon
judgment a claim merges in the
judgment and interest becomes
payable upon the judgment debt.
Since there is a statutory
provision for the payment of
interest after judgment, without
the parties agreeing to pay more
than the statutory interest, the
learned trial judge was wrong in
awarding interest “up to the
time of final payment.” It
follows that the plaintiff would
be entitled to interest on
whatever amount has been awarded
him from the date his cause of
action arose to the date of
judgment; as from the date of
judgment, the plaintiff would be
entitled to the interest
provided by law.
Subject to the above variations
I would dismiss the appeal.
LAMPTEY JA.
I agree.
ADJABENG JA.
I also agree.
Appeal dismissed subject to
variation.
Kizito Beyuo,
Legal Practitioner
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