pg 181
Libel-Notice inserted in
Newspaper by Defendant-Trial
Judge found that an innuendo in
the Notice imputing Insolvency
was established--Innuendo
imputing Insolvency was not
pleaded by the
Plaintiff-Defendant had no
opportunity to contest-Duties of
Appeal Court in such
circumstances Imputation of
Insolvency taken into
consideration in awarding
damages-Misdirection.
Held: (i) As the ·words-
complained of do not necessarily
on the face of them impute
insolvency the trial Judge was
wrong in imputing to them an
innuendo which was not pleaded.
(ii) That in assessing the
damages the trial Judge wrongly
took into account the imputation
of insolvency.
Appeal allowed; judgment of.
Court below set aside and a new
trial before a different Judge
ordered.
Cases cited:-
Dawe v. Palmer
123 English Reports 1147;
Riding v. Smith
U876)
1 Ex: 93;
Vines v. Serrell
(1835) 7 C & P. 163;
C,,.epigny v. Wellesley
(1829) 5 Bing 402 j
Praed v. Graham
(1889) 59 L.J.
Uatcliff v. Evans
(18!J2) 2 Q.B. 528;
Smith
1T.
Schilling
1928 1 K~. 429.
The facts are sufficiently set
out in the judgment .
A.
Sawyerr
(with him K. A. Bossman)
for Appellant.
J. H. Coussey
for Respondent.
The following joint judgment was
delivered:-
pg
182
KINGDON, C.J., NIGERIA, PETRIDES,
C.J., GOLD COAST
AND M'CARTHY, J.
In this case the plaintiff
caused to issue in the
Divisional Court, Accra, a writ
against the defendant containing
the following claim:-
"The plaintiff carries on
business at Accra and other
places in "the Gold Coast as a
Trader and Importer of goods
from India, " England, China,
Japan and other places.
"On October 2nd 1940, the
defendant contriving and
intending " to injure the
plaintiff in his said busine8l\
and to prevent him from "selling
his goods falsely and
maliciously wrote and published
of the " plaintiff in the form
of a Public Notice in the issue
of the
African
" Morning Post Newspaper
of that date, the following
words:-
"To WHOM IT KAY CONCERN.
'I, Gagandas Partabrai Daswani,
holding Power of Attorney
"issued on the 19th Januar.y,
1940, at Hong Kong and
instructions "from Mr Assudamal
Vaswani, the Managi,ng
Proprietor of Messrs. "Utoomal
and Assudamal Company, Hong Kong
and other branches " to file
suit against Mahtani Brothers,
Accra and other branches for ..
, owing to the said firm Utoomal
and Assudamal Company, Hong
Kong, "monies against various
bills, etc., and to cancel Power
of Attorney ,. of Choithram
Wadhumal Mahtani, brother of
Kundanmal Wadhumal "Mahtani,
Proprietor of Mahtani Brothers
of the Colony of Gold "Coast,
vested in him by the above firm
Utoomal and Assudamal " Company,
and for other purposes also do
hereby revoke Mr Choithram "Wadhumal
Maht&ni's the said Power of
Attorney.
"Any person or persons doing any
business or moneytary
transactions with him in name
of Utoomal and Assudamal Company
from " hereafter shall do so at
his, her, or their risk.
" I also hereby beg to inform
the public that any person or
persons " buying any of the
stores of Mahtani Brothers in
the Colony of Gold " Coast shall
do so at his, her, or their
risk.'
" By the said publication the
defendant meant and was
understood "to mean that the
plaintiff had no right to sell
his goods and that "he intended
or was attempting to defraud the
defendant or his •• creditors by
selling or disposing of his
goods and property and obtaining
the proceeds thereof before the
same could be secured and "
obtained possession of by or on
behalf of the defendant.
" By reason of the publication
of the said 'Notice the
plaintiff has "been greatly
injured in his credit and
reputation and has suffered "
and will suffer much loss and
damage.
"The plaintiff claims £2,000
damages."
To the claim the defendant filed
the following defence:-
" 1. The defendant admits the
writing and publication of the "
words set out in the plaintiff's
writ.
"2. The said words do not mean
and were not capable of the "
alleged meaning set out in the
plaintiff's said writ or of any
other ,. defamatory meaning.
" 3. If the said words are
capable or the alleged meaning
that the "plaintiff was
attempting to defraud the
defendant by selling or
disposing of his 'stores' and
obtaining the proceeds thereof
before "the same could be
secured and obtained possession
of by the •• defendant, the said
defendant pleads that that was
true in substance
II
and in fact ..
" 4. The said plaintiff did
first of all dispose of his Cape
Coast " Store or sell the whole
of the Stock in the said store,
then later his II
Koforidua ' Store' or the whole
of the stock in the said
Koforidua II Store, in
both cases to Messrs. K.
Chellaram and Sons and in both
"cases at prices considerably
under value at a time when the
said " plaintiff was heavily
indebted to the defendant's
Principals and without paying
over the proceeds to satisfy the
defendant's Principals' " debt
or account.
" 5. The words complained of
were uttered on a privileged
occasion, "the said defendant
having an interest as a creditor
in the said "-plaintiff's
business or his assets.
" 6. That in any case the
damages claimed are excessive
and the " plaintiff has not
suffered any damages."
And to this defence the
plaintiff filed the following
reply:. The plaintiff joins
issue with the defendant on
paragraphs 2, " 3 and 5 of his
statement of Defence.
" 2. As to paragraph 4 of the
said Defence, the plaintiff says
that "he sold goods in his
stores at Cape Coast and
Koforidua in the " ordinary
course of business and the
moneys realised from such sales
•• were paid partly on account
of Bills of supplying Merchants
including " the Bills of Utoomal
and Assudamal and Company .
•• 3. As to paragraph 6, the
plaintiff says that by reason of
the "said libel, he has been
greatly damified in his business
and has "suffered in his credit
both with Merchants in the Gold
Coast and " abroad and with
Barclays Bank (Dominion,
Colonial and Overseas), • Accra,
his Bankers."
pg 183
The action was tried by
Bannerman, J., who, on the
1st April, 1941, gave the
following judgment:-
" I consider this libel
vicious. In my view there is
no " justification for it
and it was not published on
a Privileged "occasion. I
give judgment for the
plaintiff for £1,500 "
general damages with costs
to be taxed. In view of the
"importance of this case I
will give my reasons for my
" judgment later on."
Giving his reasons on the
l0th April the learned Judge
said ;-
"The facts in this case are
so clear that there is no "
necessity to discuss them at
any great length.
" It is clear from the
evidence that when the
publication "appeared on the
2nd October, 1940, the
defendant's " principals (Utoomal
and Assudamal and Company)
had no " interest in the
goods in any of the
plaintiff's stores. In
"other words, the plaintiff
was not owing Utoomal and "
Assudamal and Company any
debt in respect of any of
the " goods in his stores,
and I am satisfied that the
defendant
pg 184
knew
that this was so. The debt
which the plaintiff was "
owing in respect of goods
delivered to him on the two
D
I
A "bills had already been
paid for before the
defendant " published the
notice in the
African Morning Post.
" True, there were certain
goods which were lying-in.
the " Warehouse of the Bank
but these goods were not in
the " plaintiff's stores at
the time of the publication.
Further" more, these goods
had already been sold to
certain Indian " Firms
before the publication
appeared in the
Morning Post.
" In my opinion the
plaintiff's liability to
Utoomal and " Assudamal and
Company, if any, represented
certain Bank "and Cable
charges as well as
depreciation in price in "
respect of the goods! which
were sold to the Indian
Firms. " 'this liability,
which the plaintiff
disputed, could not, in " my
view, justify the defendant
in publishing the notice in
" the Press. Furthermore, I
am satisfied that the
defendant " did not send any
statement of account to the
plaintiff before " he
published the notice in the
Press.
" In my view there was no
justification whatever for
the "publication of the
notice in the
Morning Post
and the " defendant was not
privileged in publishing it.
This news" paper, according
to counsel for the
plaintiff, has a fairly "
wide circulation in the Gold
Coast.
" I am satisfied that, by
this publication, the
plaintiff " has been greatly
injured in his credit and
reputation and "has suffered
and wit.! continue to suffer
much loss and " damage for
many years. Throughout the
hearing of this " case the
defendant made no attempt to
put oil on troubled "
waters, or to admit the
folly of his act. On the
other hand " he maintained
an obstinate attitude and
did all he could " to
justify the publication. The
defendant went so far
·as"to send a copy of the
publication to the
Comptroller of " Customs of
the Gold Coast, and there is
abundant evidence " on
record to show that the
plaintiff's reputation
suffered so " much that the
Bank refused to grant him
any more overdrafts. Bad as
this is, the worse is to
follow.
" The plaintiff conclusively
proved that, after the
publication, his business's
was seriously affected and
he lost his "reputation and
standing in the community
and among "Merchants. One
particular local firm
actually refused to "-supply
him with provisions on the
monthly credit basis.
pg 185
" I am bound to draw the
inference that the defendant
" deliberately published the
notice in the Press in order
to " show that the plaintiff
was insolvent and that the
goods in "his stores
belonged to Utoomal and
Assudamal and " Company. If
one person goes out of his
why maliciously " to damage
the reputation of another
person in his business " or
trade, then the person who
causes the injury must
Buffer "the consequences of
his own act.
(Dawc. 'v Palmer, 123
" English Reports page
1147). It has been held that
it is " libellous to impeach
the credit of a ' merchant
or tra1eri " , or to impute
to him fraud, dishonesty or
any other con uc " 'that
would prejudice him in the
day of
his trade or " 'business.
Thus, it is libellous to
Write and publish of a "
'trader or merchant that he
is, or has been bankrupt, "
'insolvent or in embarrassed
circumstances/ (See
Gately " on Libel and
Slander, 2nd Edition, at
page 38).
" There can be no doubt that
the defendant meant the "
public to treat the
plaintiff as an insolvent,
or that he IS "a man in
embarrassed Circumstances.
In the case of
" Riding v. S7II,ith
(1876) 1 Exchequer Division,
at page 93.. " Lord Keely,
C.B., made use of these
word~ :-' It appears " , to
me that if a man states of
another who IS a trader
earning his livelihood by
dealing in articles of
trade, anything, " , be it
what it may, the natural
consequences of uttering " ,
which would be to injure the
trade and prevent persons "
, from resorting to the
place of business, and it
.so leads to " , a loss of
trade, it is actionable.' In
my View this principle "
applies equally to libel.
" In the case of
Vines v. Serrell
(1835), 7 C
& P at page "163. Mr Justice
Parke said: 'The plaintiff
may show the " , m~nner of
the publication with a view
to damages.' For " example,
the plaintiff may show
that the libel
was published " in a
newspaper when the
defendant WAS under no
duty to " publish it
except to a limited
number of persons, for
the " more extensive
the publication of the libel
the greater the " inhuy
occasioned by it. (Crepigny
v. Tvellesly
(1829) 5 " Bing, at page
402). The plaintiff may also
urge in support "of "damages
the manner in which the
defendant has " conducted
his case at the trial. In
the case' of Praed v. "
Graham (1889), 59 I,.J.,
it is stated that ' It is a
rule of " 'law in action of
libel that the Jury, in
assessing the " , damages,
are entitled to
look at the whole
conduct of the " 'defendant
from the time when the libel
was published " 'down to the
very moment of their
verdict. They may " , take
into their consideration the
conduct of the defendant " ,
before the action, after the
action, and in Court at
trial
of the action.'
" In this case I was sitting
both as a Judge and Jury "
and the defendant did not
make the slightest attempt
at any " stage of the
proceedings to throw himself
into the arms of "mercy. In
these circumstances I was
bound, after the "plaintiff
had satisfactorily
established his case, to
regard "the conduct of the
defendant as vicious and to
award "substantial damages.
Apart from the viciousness
of the " defendant's conduct
there are, no doubt, certain
aggravating " circumstances
in the case which must be
taken into account " in
awarding damages. In
the
case of
libel
or
slander which
pg 186
is actionable
per se
(as in the present case) the
plaintiff "would not prove
that he has Buffered any
damage as the " result of
the words complained of, for
' the law presumes " , that
some damage will fonow in
the ordinary course of ",'
things from the mere
invasion of his absolute
right to " , reputation' per
Bowen, L. J., in the case of
Ratcliff 'V.
.•• Evans
(1892) 2 Q.B., at page 528.
"If the plaintiff has
suffered any pecuniary loss
over "and above the general
damages prescribed, he may
give " evidence of such
loss, provided he alleged in
his statement " of claim.
But if the plaintiff fails
to prove such pecuniary
"loss at the trial, he may
still receive general
damages. (" Riding
'V.
Smith
(1876), 1 Exchequer
Division, 91).
" In view of the foregoing
reasons I gave judgment for
"'the plaintiff as already
recorded.'"
The defendant has appealed
to this Court against the
judgment upon the following
grounds:-
" 1. That the plaintiff
failed to prove the innuendo
alleged in his " Statement
of Claim, and the Court
balWd ita decision on an
innuendo " not alleged nor
relied ~n by the plaintiff.
" 2. That the defendant
proved the truth of the
statements in the
"publication complained of,
and the Court was wrong in
its decision " that
justification had not been
proved.
" 3. That the plainti4f did
not prove the damages
awarded and "such award of
damages was grossly
excessive.
" 4. Judgment against the
weight of evidence.
" 5. The publication was
incapable of the meaning
that plaintiff "was
insolvent, or was a man in
embarrassed circumstances;
but if "the publication was
capable of that meaning then
it was true in "substance
and in fact even on the.
admission of the plaintiff
himself.
"6. The Judge applied wrong
principles of law to the
decision of "this case in
that he applied the rule of
law relating to cases of "
Publication in regard to
insolvency when the
Plaintiff's case was not "
based on an innuendo
suggesting the insolvency of
the plaintiff.
" 7. The Court was wrong in
assessing damages on the
footing that " the defendant
imputed insolvency to the
plaintiff whereas the
plaintiff "himself did not
rely on an innuendo imputing
insolvency."
In filing those grounds of
appeal he has treated the "
reasons" as incorporated in
and forming part of the
judgment we think this
is the proper course and we
propose to do the same.
We feel compelled to allow
this appeal on ground 7 only
and we ~re 2.eliberately
refraining from saying
anything as to the other six
grounds of appeal in case we
might ,thereby prejudice the
re-trial which we find it
necessary to order. We agree
with the appellant's
contention that the words
complained of do not
necessarily on the face of
them impute insolvency to
the respondent. But we think
from the two passages in the
reasons for judgment:
pg187
I
am bound to draw the
inference that the defendant
deliberately published the
notice in the Press in order
to
show that the plaintiff was
insolvent."
There can be no doubt that
the defendant meant the
public to treat the
plaintiff as an insolvent,
or that he was
a man in embarrassed
circumstances that it is
clear that the learned trial
Judge was in fact finding
that an innuendo imputing
insolvency to respondent was
established. This was an
innuendo which was not
pleaded and which the
8:ppellant had had no
opportunity to contest. It
might have been met either
by showing'- that the words
could not bear that meaning
or by justifying the meaning
or both.
We think that it is also
clear that in assessing the
damages the learned trial
Judge took into
consideration the damage
which might reasonably
accrue to the respondent by
the imputation of insolvency
which he (the trial Judge)
had found to be established,
and we are of opinion that
in so doing he misdirected
himself. The duties of an
Appeal Court in such
circumstances are concisely
stated by
Greer, L. J., in the case of
Smdh v Schilling
(1928) 1 K.B.429 (C.A.) at
page 440:-
" The verdict may be set
aside if the Court of Appeal
" upon all the circumstances
comes to the conclusion that
the "damages awarded are so
small or so large that
twelve " sensible jurors
could not reasonably have
awarded them; or "if the
Court is satisfied that the
jury have taken into "
account matters which they
ought not to have taken into
" account or have
disregarded matters which
they ought to " have taken
into account."
In the present case we are
of opinion that the. learned
trial judge, in assessing
the damages, took into
account a matter which he
ought not to have taken into
account namely the
imputation of insolvency to
the respondent which he
(wrongly, in our view) found
to be established. A new
trial is therefore necessary
unless the parties should
have agreed to this Court
assessing the damage.
Following the precedent of
the procedure adopted by the
Court of Appeal in England
in
Smith v. Schilling (.mpra)
we have given the parties an
opportunity of giving such
consent. But the appellant
has been unwilling to do so.
The appeal is therefore
allowed, the judgment of the
Court below, including the
order as to costs, is set
aside, and it is -ordered
that if. any sum has been
paid by the appellant to the
respondent in pursuance of
that judgment it shall be
'refunded. The appellant is
awarded costs in this Court
assessed at £52 lIs 9d. The
costs already incurred in
the Court below are to be in
the discretion of the Judge
at the new trial. We need
,hardly add that it is
desirable that the new trial
should take place before a
different Judge.