PHARMACIA (NIG) LTD v. PHARMACIA CORPORATION (2020)

PHARMACIA (NIG) LTD v. PHARMACIA CORPORATION

(2020)LCN/15207(CA)

In The Court Of Appeal

(LAGOS JUDICIAL DIVISION)

On Thursday, March 19, 2020

CA/L/974/2010

Before Our Lordships:

Tijjani Abubakar Justice of the Court of Appeal

Gabriel Omoniyi Kolawole Justice of the Court of Appeal

Ebiowei Tobi Justice of the Court of Appeal

Between

PHARMACIA NIGERIA LIMITED APPELANT(S)

And

PHARMACIA CORPORATION RESPONDENT(S)

RATIO

THE LAW ON PASSING OFF

This is the kind of situation that the law on passing off intends to prevent. In Blacks Law Dictionary, 8th Edition, 2004 page 1155, passing –off was defined as part of intellectual property law in these words:
“The act or an instance of falsely representing one’s own product as that of another in an attempt to deceive potential buyers. Passing off is actionable in tort under the law of unfair competition. It may also be actionable as trademark infringement.”
The law on passing-off which is in the field of intellectual property law can be seen as a trademark infringement that is actionable in tort. Where a person or a company makes a false representation of the product of another company presenting same as its own with the purpose of confusing the public and deceiving them, the company or individual carrying out such an act will be liable for passing off the product of the other company. See Ayman Enterprises Ltd vs. Akuma Industries Ltd & Ors (2003) 13 NWLR (Pt. 836) 22. PER TOBI, J.C.A.

WHETHER OR NOT A POWER OF ATTORNEY CAN ONLY BIND THE PERSON OR COMPANY WHO DONATES IT

The answer is not farfetched as a Power of Attorney can only bind the person or company who donates it and cannot bind any other person in terms of liability since that other person was not privy to the said Power of Attorney. See Ajoko vs. Okafor & Anor (2019) LPELR-46516(CA); Ekengwu vs. Ekengwu (2018) LPELR-45070(CA). This is because a Power of Attorney by legal implication is an authority given to the donee to exercise certain powers on behalf of the donor. The Supreme Court in Alhaji A.B. Abubakar vs. Alhaji Abubakar Waziri & Ors NSCQR Vol. 35 (2008) 333 at 338 while defining a Power of Attorney held:
“Power of Attorney is an instrument in writing whereby one person as principal, appoints another as his agent and confers authority to perform certain specific acts or kind of acts on behalf of the principal.” PER TOBI, J.C.A.

WHETHER OR NOT A SUBSIDIARY COMPANY CAN ENTER INTO A CONTRACT ON BEHALF OF THE PARENT COMPANY

EBIOWEI TOBI, J.C.A. (Delivering the Leading Judgment): This present appeal is against the judgment of the Federal High Court, sitting in Lagos, delivered by I.N. Auta J (as he then was) on 14/1/2010 in Suit No. FHC/L/CS/1223/07 – Pharmacia Corporation vs. Pharmacia Nigeria Limited. The fact of the case is simple. The Respondent (Claimant at the Lower Court) is a company incorporated under the laws of the State of Delaware in the United States of America. The Respondent is into the business of manufacturing, exporting and marketing of pharmaceutical products all over the world. The Respondent has subsidiaries including Pharmacia & Upjohn NV/SA. The Respondent entered into a merger with Pfizer Incorporated consequent upon which Pfizer Specialties Limited, a company incorporated in Nigeria as a subsidiary to Pfizer Incorporated was appointed to act on the Respondent’s behalf and in the Respondent’s name for the purpose of protecting the Respondent’s goodwill in its name and the business carried on in its name. Before then in 1998 and 2003, Pharmacia & Upjohn NV/SA, a company incorporated in Belgium, which is a subsidiary of the Respondent, engaged the services of five persons in Nigeria as sales consultants under individual consultancy agreements. Consequent to the merger on 16/4/2003, the Respondent and all its subsidiaries all over the world became fully owned subsidiaries of Pfizer Inc. Following the merger, the consultancy agreements between Pharmacia & Upjohn NV/SA and the sales consultants were terminated as Pfizer Inc had a subsidiary company in Nigeria which could perform the functions the sales consultants were engaged to perform. It was when Pfizer Inc. instructed its Nigerian subsidiary, Pfizer Specialties Limited to make contact with the sales consultants with a view of taking over from them any asset of Pharmacia & Upjohn NV/SA in their possession, that they discovered that the Consultants had registered a Nigerian Company with the Respondent’s name and using its logo without their consent. The Respondent, consequently, filed a suit at the Lower Court seeking among other reliefs for a perpetual injunction restraining the Appellant from passing off the product of the Respondent and from using the word “Pharmacia” in the name of the Appellant and further from using the Respondent’s logo. The Lower Court in its judgment found on pages 153-179 of the record found in favour of the Respondent awarding N1,000,000 damages to the Respondent. The Appellant (Defendant in the Lower Court) being dissatisfied with the judgment of the Lower Court has filed this appeal.

The Appellant’s notice of appeal dated 9/4/2010 and filed on 13/4/2010 is found on pages 183-186 of the record of appeal. The grounds of the appeal are:
A. The learned Trial Judge erred in law when he held that the reputation and goodwill acquired by the Respondent is at variance with the interest of the Appellant who was at the material time the only authorized agent or representative of the Respondent in Nigeria.
B. The Learned Trial Judge erred in law when he failed to distinguish the principle in the authority of Niger Chemist Ltd. vs. Nigeria Chemist & Anor when he held that the Appellant is likely to misrepresent and mislead the public by the Appellant’s name.
C. The Learned Trial Judge misdirected himself in law when he concluded that an authorized agent or representative was misrepresenting or misleading the public on to the products of their Principal.
D. The Learned Judge erred in law when he awarded an extremely or ridiculous amount of damages against the Appellant.
E. The Learned Trial Judge erred in law by his failure to consider and give a decision on same (sic) on (sic) Defendant/Appellant’s written submissions on legal issues on the status of the exclusive incorporation of the Defendant/Appellant in Nigeria.
F. The Learned Trial Judge erred in law as the judgment is against the weight of evidence.

The Appellant’s brief dated and filed on 12/6/2014 was settled by Francis Rotimi Adeniji Esq. In its brief adopted on 31/1/2020, the Appellant raised three issues for determination. These are:
1. Whether or not an authorized agent using a name allowed by its principal can be said to be passing off the goodwill of the principal even after the name has been swallowed in a merger?
2. Whether or not the decision in Niger Chemist v. Nigeria Chemist can be distinguished from this case?
3. Whether or not the award of N1,000,000.00 damages to the Respondent was outrageous and excessive?

On its issue 1, it is the contention of the Appellant’s counsel that the Appellant was marketing the products of the Respondent under the name Pharmacia Nig. Ltd with the consent of the Respondent. It is the Appellant’s further contention that there was unchallenged evidence that the Appellant started their business in Nigeria with the name Pharmacia Scientific Enterprises before it had to change its name to Pharmacia Nigeria Limited.

It is the submission of Appellant counsel that one of the ways an agency is created in law is by writing. He relied on Exhibit F1, power of attorney given to the Appellant by the Respondent to postulate that an agency relationship was created and as such, the Appellant has the authority to act as the agent of the Respondent. He cited Diab Nasr & Anor. vs. Antoinne Rossek (1973) 6 S.C. 90 at 100. Relying on Lloyd vs. Grace Smith & Co. (1912) A.C. 716 and Modebe vs. Okadigbo (1992) 9 NWLR (Pt. 263) 1 at 20. It is the submission of counsel that where an officer has acted within its authority and the purpose of the power of attorney has been performed, the action of such an officer cannot be impeached even after he might have resigned from his employment. It is counsel’s contention that a deed such as Exhibit F1 – the power of attorney cannot be impeached by a stranger. He relied on Abina vs. Farhat (1938) 13 NLR 17.

On the validity of the power of attorney, counsel placed reliance on Triana vs. Polymakers (2001) 46 WRN 50 at 58; Imona-Russel vs. Niger Construction Ltd. (1987) 3 NWLR (Pt. 60) S.C. 298 and Metalimpex vs. A.G Leventis& Co. (Nig.) Ltd. (1976) 1. N.S.C.C. 76 at 88; (1976) 2 S.C. 48. On this, the Appellant’s counsel submitted that an agent duly appointed cannot be said to have passed off the goodwill of its principal as from all indications, it was obvious that the Appellant was not using the name of the Respondent without the knowledge and consent of the owner of the name and the goodwill. He relied on Niger Progress Ltd. vs. NEL Corporation (1989) 3 NWLR (Pt. 107) 68 at 69; A. Modebe vs. Dr. Chuba Okadigbo & Ors. (1992) 9 NWLR (Pt. 263) 1 and Imona Russel vs. Niger Construction Ltd (1987) 3 NWLR (Pt. 60) 298.

On issue 2, it is the submission of counsel that the case of Niger Chemist Ltd. vs.Nigeria Chemist & Anor. (1961) 1 ANLR 171, relied on by the Lower Court in its judgment differs materially from this present case. In distinguishing the Niger Chemist case from this present case, counsel submitted that the decision in the case of Niger chemist was reached on the basis that the name was likely to cause confusion because both parties were carrying on business in the same locality whereas in this present case, the Appellant was doing business in Nigeria on the appointment of the Respondent. Another critical difference highlighted by counsel is that in this recent case, the Appellant was carrying on business as an authorized agent of the Respondent and not a rival. Relying on Arsenal Football Club Plc. vs. Reed 2001 R.P.C. 46; Erwen Warmick B.V. vs. J. Jowend & Sons (Hull) Ltd. (1979) A.C 731 at 742 and HFC Bank Plc. Vs. Midland Bank Plc. (2000) FSR. 76, it is the submission of counsel that to establish passing off, there is a need for the element of misrepresentation.

It is the final submission of counsel that the Appellant had the consent of the Respondent to use their name and trade in their products at inception and that the subsequent merger that brought the Respondent and Pfizer together cannot override the arrangement of agent and principal without terms.

On the last issue, issue 3, it is the submission of counsel that one of the general principles in the award of damages is the need of the Plaintiff to prove his claim and that the Courts are expected to base the award of quantum of damages on the circumstances of the case; which in this case, the Respondent has not done. He relied on U.A.C. (Nig) Plc. vs. Irele (2001) 5 NWLR (Pt. 707) 583. It is counsel’s further submission that there was no basis for the Lower Court to award such an extreme amount in favour of the Respondent as among other factors, there was no proof of losses by the Respondent in Nigeria after the merger. He cited Nzeribe vs. Dave Eng. Co. Ltd. (1994) 8 NWLR (Pt. 361) 124; Ordia vs. Piedmont Nig. Ltd. (1995) 2 NWLR (Pt. 379) 517 and Bola vs. Bankole (1986) 3 NWLR (Pt. 27) 141.

In conclusion, counsel urged this Court to set aside the award of damages by the Lower Court in the absence of proof and in the whole to set aside the judgment of the lower Court and allow the appeal.
The brief of the Respondent dated and filed 25/5/2015 and adopted on 31/1/2020 was settled by Obatosin Ogunkeye Esq. In its brief, counsel raised two issues for determination. These are:
1. Whether, given the relationship between the Appellant and the Respondent, the Appellant should have been found liable to the Respondent for the tort of passing off?
2. Whether the award of N1million as general damages was excessive?

On issue 1, it is the submission of counsel relying on Reckitt & Colman vs. Borden (1990) 107 RPC 340 at 406 that the use of the Respondent’s name and logo by the Appellant constituted a misrepresentation enabling the Appellant to be passed off as a subsidiary or affiliate of the Respondent.

With regards to the argument of the Appellant that the Respondent consented to the incorporation of the Appellant in the name, Pharmacia Nigeria Limited, it is counsel’s submission that there is no evidence before the Court to support that assertion. It is the further submission of counsel that none of the correspondence which the Appellant claimed was written by the Respondent was actually written by the Respondent. That they were written on behalf of companies that were presumably, subsidiaries of the Respondent; to which the Respondent was no more than a shareholder to those subsidiaries. Relying on Section 37 of the Companies and Allied Matters Act; CBDI vs. COBEC (Nig) Ltd (2004) 13 NWLR (Pt. 890) 376; K.S.O and Allied Products Ltd vs. Kofa Trading Co. Ltd (1996) 3 NWLR (Pt. 436) 244, it is counsel’s submission that while a fact known to an employee or an officer of a company is deemed as fact known to the company, such a fact cannot be deemed to be known to the company’s shareholders. He therefore submitted that even if persons who wrote on behalf of the two subsidiaries of the Respondent had pre-knowledge of the name to be adopted by the Appellant before it was incorporated, that knowledge cannot be deemed to be the knowledge of the Respondent. Counsel pointed out the fact that the subscribers of the Memorandum of Association of the Appellant at incorporation were employees of the subsidiaries of the Respondent and their knowledge by virtue of the role they played in the incorporation of the Appellant cannot be deemed to be the Respondent’s knowledge.
It is submitted by counsel with respect to the contention of the Appellant that they were the agent of the Respondent, trading solely in the products of the Respondent and therefore cannot be said to be passing off the goodwill of its principal; that the Appellant was never validly appointed by the Respondent and even if it was, the appointment did not include the duty to sell the Respondent’s goods. Relying on Helen Udoh vs. Registered Trustees of the Brotherhood of the Cross and Star (2011) LPELR-4237 (CA), it is further submitted that a donor of a power of attorney can only appoint an agent to represent his interest and not to represent the interest of another person unless authorized by that other person to appoint an agent for him. That apart, it is the contention of Respondent’s counsel that Pharmacia International Sarl, a subsidiary of the Respondent could not have validly appointed the Appellant as an agent of the Respondent without specific authorization from the Respondent, more so, Exhibit F1 – the power of attorney did not validly emanate from Pharmacia International Sarl.

Counsel went further to submit that the authorization purportedly given to the Appellant by Exhibit F1 was limited to representing Pharmacia in its day to day relations for the registration of Pharmacia pharmaceutical products in Nigeria and not with respect to the selling of Pharmacia drugs to the Nigerian public or to any other person.

On the argument of the Appellant on distinguishing the case of Niger Chemists Limited (supra) with this present case, it is the submission of counsel that the fact that the Respondent is based outside Nigeria, whilst the Appellant is based in Nigeria is not a material consideration for the determination of whether the Appellant should not be restrained from using a name which will likely lead to deception or confusion. That is the material part of that judgment and indeed in this case. The Court took into consideration in the Niger Chemist case whether the plaintiff had become recognized within the locality by a particular name and whether the adoption of a name similar to that name would not lead to confusion and deception. Learned counsel urged this Court to resolve issue 1 in favour of the Respondent.

On issue 2, it is the submission of learned counsel that the basis of the Respondent’s claim for general damages was pleaded in paragraph 19 of the statement of claim and that same was supported by the testimony of PW1. It is the further submission of counsel that the Court could make an award of general damages even if it cannot point out any measure of assessment except what it can hold in the opinion of a reasonable man. He relied on Joseph vs. Abubakar (2002) 5 NWLR (Pt. 759) 185 at 207. He submitted that the reasonableness or otherwise of the quantum of the award can be judged in relation to the value of the business in connection with which the injury was done to the Respondent. It is the final submission of counsel that the award of the lower Court was based on a sound principle of law and was not excessive in the circumstances of the case and urged this Court to answer issue 2 in the negative. It is the final submission of counsel that the appeal be dismissed.

I would need to mention for completeness that the Appellant filed an additional record of appeal dated 28/8/2014 but filed 1/9/2014 and deemed on 9/12/2019.

The facts culminating in this appeal have been relayed above and therefore I need not repeat same. The issues for determination raised by all the parties are similar apart from issue 2 raised by the Appellant which relates to the relevance of the case of Niger Chemist vs. Nigeria Chemist (supra). I will in this judgment adopt the issues raised by the Respondent in determining this appeal.

I will now deal with issue 1. For completeness, I reproduce the said issue 1:
“Whether, given the relationship between the Appellant and the Respondent, the Appellant should have been found liable to the Respondent for the tort of passing off?

The salient issues in this appeal, however, in my opinion, is whether the Appellant who was appointed as a sales consultant to the subsidiary of the Respondent, Pharmacia & UpJohn NV/SA had the powers to incorporate a company in furtherance of the consultancy agreement, a company with a similar name with the parent company and also use the logo of the parent company without been held liable for passing off the parent company or its products? That the name of the Appellant registered in Nigeria is similar to the name of the parent company is not in doubt at all. The contention of the Appellant is not along with that line as this is a common ground between the parties. The Appellant’s case is that, it cannot be liable for passing off when it is a lawfully recognized agent of the Respondent and that the company so registered was done in line with the law in Nigeria with the consent of the Respondent. The Respondent’s case, on the other hand, is that the name registered in Nigeria as the Appellant is similar with the known name of the Respondent and can at all material time and for all material purposes be taken as the Nigerian subsidiary for the parent company and therefore the general public will be confused as to coming to the conclusion that it is the same company. In addition to this, the Respondent’s strong case is that it had no knowledge of the company that the Appellant registered and that the member’s knowledge of the subsidiary does not translate to the consent of the parent company. The parent company is Pharmacia Corporation (The Respondent) while the Nigerian company is Pharmacia Nigeria Limited (Appellant). There is no dispute that the Appellant also uses a logo similar in all material respect to the Respondent’s logo. In the face of the above facts, there is no dispute that the public and indeed any reasonable man will take the Appellant’s company as a subsidiary of the Respondent and indeed it can pass off the product of the Appellant for that of the Respondent. There is a clear confusion and deception and indeed a misrepresentation to the general public. This is the kind of situation that the law on passing off intends to prevent. In Blacks Law Dictionary, 8th Edition, 2004 page 1155, passing –off was defined as part of intellectual property law in these words:
“The act or an instance of falsely representing one’s own product as that of another in an attempt to deceive potential buyers. Passing off is actionable in tort under the law of unfair competition. It may also be actionable as trademark infringement.”
The law on passing-off which is in the field of intellectual property law can be seen as a trademark infringement that is actionable in tort. Where a person or a company makes a false representation of the product of another company presenting same as its own with the purpose of confusing the public and deceiving them, the company or individual carrying out such an act will be liable for passing off the product of the other company. See Ayman Enterprises Ltd vs. Akuma Industries Ltd & Ors (2003) 13 NWLR (Pt. 836) 22.
The evidence before the lower Court that informed the decision of his lordship is that the Respondent’s company is a well-known worldwide pharmaceutical company registered with the name “Pharmacia” with a distinctive logo bearing the name. The Respondent, therefore, has acquired a good reputation and goodwill in Nigeria. The registration of the Appellant in a similar name after this gained reputation is an infringement of the trademark of the Respondent and therefore the product of the Appellant can pass off in the eyes of the public as products of the Respondent. In this regard the lower Court at page 177 of the record of appeal held as follows:
“It will not be hard to arrive at the conclusion that because the Defendant have been part of the Plaintiff and aware of its goodwill, that they deliberately chose a name, that will give the impression that they are the representative of the Plaintiffs in Nigeria, and with the authority to market their products. The Defendant by Ex. L, used the Pharmacia logo. The Defendant also used the logo of the company on their products. Even if the Defendants have no intention of deceiving the public, the fact still remains that they have put themselves up as representatives of the Plaintiff and therefore guilty of passing off of the goods of the plaintiff, which is capable of misleading purchasers into the belief that they were the Plaintiffs good.”
On the face value, informed by the evidence before the lower Court, I cannot interfere with the finding of the lower Court above as the above finding falls in line with the evidence before the lower Court. The Respondent’s company is incorporated though in the United States is known in Nigeria as a leading pharmaceutical company as Pharmacia Corporation with subsidiaries all over the world. The Appellant was a sales agent to a subsidiary of the Respondent. The Appellant went ahead to incorporate a company in Nigeria with the name Pharmacia Nigeria Limited. The Respondent is Pharmacia Corporation and the Appellant is Pharmacia Nigeria Limited. To all reasonable persons and for all intent and purpose, the product of the Appellant can pass off for the product of the Respondent and this will definitely cause confusion to the public and indeed confuse the public. The conclusion of the lower Court, therefore, is not out of place. I really do not believe that the Appellant has a challenge with that but the Appellant case is that in view of the relationship that existed between it and the Respondent’s subsidiary wherein it is appointed as a sales representative and the Power of Attorney entered between it and the Respondent represented by the then President of Africa & North Africa, Jacques Blote, it cannot be held liable for passing off. Putting it in the way the Appellant saw it, an agent cannot be liable for passing off the product of his principal. This is the main thrust of the Appellant’s case. Yes, on the face of it there seem to be passing off but the big question is whether the relationship between them changes anything. It will not be out of place at this stage to know what exactly was the relationship between the Appellant and the Respondent. The starting point is to know what the lower Court made as a finding as to the relationship between them and how it affects the position of the law on passing off.
It does not appear that the lower Court made any specific finding on the evidence before it as to the relationship between the parties and in such a situation, this Court by law can assume the position of the trial Court to make a finding in this regard by assessing and evaluating the evidence before me. See Akaose & Ors vs. Okoye & Ors (2016) LPELR-40172; Akpan & Ors vs. Otong & ORS (1996) 10 NWLR (Pt. 476) 108; Dakwang vs. NJC & Ors (2019) LPELR-48450 (CA). What is the evidence? It is not complicated. The Respondent is a worldwide pharmaceutical company registered in the United States as Pharmacia Corporation. It has subsidiaries including Pharmacia & Upjohn NV/SA incorporated in Belgium and Pharmacia International Sarl in Switzerland. The Appellant was originally appointed as a sales consultant of the parent Respondent with specific agreement. The Respondent as parent company merged with another company in the United States by name Pfizer Incorporated. This merger was in 2003. In 2005, the sales consultancy was revoked by virtue of the merger since Pfizer Incorporated has a subsidiary company in Nigeria by name Pfizer Specialties Limited which effectively carried out the function that the Appellant was carrying out, that is promoting the goodwill of the Respondent. It is at this stage that the Respondent found out that the Appellant has taken to the next level the brief it had originally by incorporating a company in the name of Pharmacia Nigeria Limited with the knowledge and approval of the then President of Africa & North Africa of the subsidiary of the Respondent. The then President of Africa & North Africa, Jacques Blote incorporated the Appellant without the consent and the approval of the parent company being the Respondent. The said Jacque Blote is a Director of the Appellant. This means he has a vested interest in the Appellant. There is no evidence before the lower Court that the Respondent which is the parent company was aware of the Appellant registered in that name in Nigeria. There is no evidence that there was any such approval from the Respondent. The said Jaqcues Blote donated a Power of Attorney to the Appellant which is Exhibit F1 as the President of Africa & North Africa. The Power of Attorney has the stamp of the subsidiary Pharmacia International Sarl, Switzerland. The direct interpretation is that the Power of Attorney was donated by Pharmacia International Sarl, Switzerland represented by Jacques Blote. Can this Power of Attorney bind the Respondent? The answer is not farfetched as a Power of Attorney can only bind the person or company who donates it and cannot bind any other person in terms of liability since that other person was not privy to the said Power of Attorney. See Ajoko vs. Okafor & Anor (2019) LPELR-46516(CA); Ekengwu vs. Ekengwu (2018) LPELR-45070(CA). This is because a Power of Attorney by legal implication is an authority given to the donee to exercise certain powers on behalf of the donor. The Supreme Court in Alhaji A.B. Abubakar vs. Alhaji Abubakar Waziri & Ors NSCQR Vol. 35 (2008) 333 at 338 while defining a Power of Attorney held:
“Power of Attorney is an instrument in writing whereby one person as principal, appoints another as his agent and confers authority to perform certain specific acts or kind of acts on behalf of the principal.”

The point I am laboring to make here is that a subsidiary company cannot enter into a contract on behalf of the parent company when there is no such authorization expressly or by the operation of law. Any officer in a subsidiary company who enters into any contract or obligation binding the parent company will have done so ultra vires its powers and the implication is that the parent company will not be liable for such obligation as the subsidiary company has its legal personality. The apex Court made this point very clear in the case of Bulet Int’l (Nig.) Ltd & Anor vs. Olaniyi & Anor (2017) LPELR-42475(SC), per Kekere-Ekun, JSC at pages 65-68 while espousing the status of a parent company and its subsidiary stated thus:
“The concept of corporate personality was established a long time ago in the case of Salomon v. Salomon & Company Ltd (1897) AC 22 to the effect that a company is a legal entity distinct from its members. It has a distinct legal personality and is capable of suing and being sued in its corporate name. A company is a different person altogether from the subscribers to the memorandum and is neither an agent nor a trustee for them. It also has the capacity to enter into any agreement in its corporate name. See: Marina Nominees Ltd v. F.B.I.R.(1986) NWLR (Pt. 20) 48; Afolabi & Ors v. Western Steel Works Ltd & Ors (2012) 17 NWLR (Pt. 1329) 286. See also Section 37 & 38 of the CAMA. A subsidiary company has its own separate legal personality. In general, the acts of a subsidiary company cannot be imputed to the parent company and vice versa. See Union Beverages Ltd. v. Pepsi Cola International Ltd. & Ors. (supra). The lower Court was right when it held that the liquidation of Commerce Bank Plc could not and did not affect transactions validly entered into by the 2nd respondent.”
In his contributory judgment therein, Eko, JSC said:
“In any case, the 2nd Respondent, C.B. Ventures Ltd, upon its incorporation, had acquired a legal personality that made it distinct from its parent company, Commerce Bank Plc. That is the undeniable corporate personality recognized in law since the decision in SALOMON v. SALOMON LTD (1897) AC 22… to impute the life and transactions of the 2nd Respondent to the fortunes of its parent company cannot sail. See: UNION BEVERAGES LTD. v. PEPSI COLA INTERNATIONAL LTD. & ORS (1994) 4 NWLR (Pt. 330) 1 AT 6.”
Sounding more specific and relevant, Pharmacia International Sarl, Switzerland being a subsidiary of the Respondent has its legal personality and identity and therefore cannot execute a Power of Attorney on behalf of the Respondent which will be binding on it if such Power of Attorney was not entered by the authority of the Respondent. The Appellant’s case to the effect that the Respondent is aware of the registration of the Appellant is based on the Power of Attorney Jacques Blote donated to the Appellant on behalf of the subsidiary of the Respondent, that is Pharmacia International Sarl, Switzerland. As earlier mentioned there is no evidence before the lower Court to the effect that Jacques Blote had the authority of the Respondent being the parent company to execute Exhibit F1 on its behalf. Consequent upon this, I have no difficulty in holding that Pharmacia International Sarl Switzerland and a fortiori Jacques Blote has no powers to donate the Power of Attorney to the Appellant more so when there is no such authority from the Respondent, the Power of Attorney has no binding force on the Respondent. It is really curious that the said Jacques Blote being the President of Africa & North Africa while within the Respondent’s employment went ahead to incorporate a company to which he is a Director without the knowledge of his employers and went ahead to commit his employers without their knowledge in a company he has an interest. This is a gross abuse of power and indeed what is referred to in the commercial circle as insider trading. The implication of all this is that the relationship that existed between the Respondent and the Appellant is only to the extent of being a sales consultant and nothing more. It is definitely not an agent/Principal relationship as the Appellant wants the Court to believe. In whichever way it is looked at, the relationship does not by any stretch of imagination include registering a company in a name similar to the name of the Respondent.
The Power of Attorney normally states the function that the donor donates to the donee. The Power of Attorney is to state the authority or the extent of the power donated under it. In view of the finding above that the subsidiary company has no powers to enter into Exhibit F1, the defence of the Appellant cannot fly. However, in the alternative, looking at the power of attorney, there is nothing in it that shows that the Appellant has the authority to register a company in the name that is similar to the Respondent and to further use the logo of the Respondent without consent. The Power of Attorney stated clearly that the power in the Power of Attorney is limited to the following matters:
1. To represent Pharmacia or any of the companies which merged to form Pharmacia i.e. Pharmacia, Upjohn and Phamacia & Upjohn in its day-to-day relations for the registration of Pharmacia pharmaceutical products in Nigeria.
2. To sign and make applications on behalf of Pharmacia for request, petitions and documents required for registration of pharmaceutical products with Nigerian Authorities for registration of the products in the name of Pharmacia.
The above powers do not in any way include the power to register a company in the name similar to the parent company or to use the logo of the parent company as the Appellant has done. The registration of the Appellant company in the name it was registered and using a logo similar in all respect with the logo of the Respondent clearly is a passing off of the Respondent’s company or products as it amounts to a misrepresentation by the Appellant as a subsidiary of the parent company. The goodwill and products of the Respondent have been passed off. The lower Court held this much on page 178 of the records thus:
“I refer to the case of Niger Chemist Ltd vs Nigeria Chemist and another (1961) ALL NLR p.180 at182) and submitted that the Defendants have by their action held up their company and products as that of the Plaintiffs, which is not the case, they are therefore liable to deceive the public into believing that they are representative of the Plaintiffs company.
In this case, the Defendant never denied using the name and logo of the Plaintiffs company…”
From the facts of the case and the finding of the lower Court, it is clear without dispute that the mere fact that the Appellant did not deny the use of logo similar to the Respondent’s logo and registered the Appellant in a name similar to the Respondent, engaging in similar product clearly amounts to a passing-off. What would have excused the Appellant from liability would have been if the Respondent knew and authorized the use of the name and the logo. The relationship between them if it was the way the Appellant said it, there would have not been any liability for passing-off. Consequent to my finding above, the only reasonable conclusion that I can reach is to resolve issue 1 in favour of the Respondent.
Having so held, I must, however, add in stating that the attempt to distinguish the facts of this case from the facts of Niger Chemist Ltd vs. Nigeria Chemist & Anor (supra) though a good attempt but it will not fly because as the principle of that case as stated above is applicable to this case before the lower Court. The principle as stated correctly in my view is applicable here since the Respondent company though not registered in Nigeria, has gathered so much goodwill, the registration of the Appellant in a similar name and using a similar logo will amount to passing off as it is a misrepresentation, confusing and deceiving the public that the Appellant is a subsidiary of the Respondent. I hold again that Issue 1 is resolved in favour of the Respondent.<br< p=”” style=”box-sizing: inherit; margin: 0px; padding: 0px;”>

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The second issue is whether the award of N1,000,000 as damages is excessive. The lower court on page 178 on the issue of damages held thus:
“It is pertinent to note where the passing-off of goods are established as in this case, the law presumes that damages will result from the act of the Defendant. The law presumes that the Plaintiff has suffered damages. The Court therefore finds that the action of the Defendant is likely to cause damages to the business and goodwill of the Plaintiff….The Court therefore grant prayers (a-c) and also the sum of N1,000,000 as general damages.”
The Appellant is very unhappy about the amount that was awarded as general damages. The Appellant exercising the right of appeal raised this issue of damages as a ground of appeal. I have no problem with that but I must state that counsel in preparing his client’s case must realize that he is a minister in the temple of justice and therefore owes the Court the duty to be civil in its language while referring to a Court or the act of a judge. See Chime & Ors vs. Chime & Ors (2001) 1 SC (Pt. 11) 1; Amaechi vs. Omehia & Ors (2012) LPELR-20603 (SC); Itedjere vs. Oharisi & Anor (2007) 7 LPELR-3936 (CA). In Akindipe vs. State (2012) 16 NWLR (Pt. 1325) 94: (2012) LPELR 9345 (SC) p.13-14 the apex Court held:
“Above all, though learned Counsel has a right and indeed a duty to present his client’s case to the best of his ability as Counsel, he has to do so within the bounds of professional ethics. The duty he owes his client is subject to a higher duty he owes to a higher cause – the cause of justice. It is a breach of professional ethics for Counsel to cast aspersion on the integrity and impartiality of a judge without proper foundation and proof.”
The Supreme Court per Onnoghen, JCS (as he then was) in Fecilia Akinbisade vs. State NSCQR Vol. 27 2005 p. 743 at page 799 held:
“Learned counsel must always bear it in mind that the legal profession is one based on the reasonable and responsible use of words and that he owes a duty not only to himself but the Court to be very responsible in his choice of words in addressing the Court on issues in contention.”
A counsel is at liberty to present its client’s case as forceful as possible but he must not do so at the expense of professional ethics and his duty and role as a minister in the temple of justice. The counsel must be courteous and respectful in presenting his case. His language needs to be civil and he must not be carried away by sentiment and cast aspersion on the integrity of the Court or the judge and indeed the judgment. The judge represents an institution and every person in the temple of justice and indeed every citizen and institution has a duty to respect the sanctity of the Court. The language a lawyer uses must be decent and civil no matter how bad he feels about the judgment. The lawyer’s duty is to present the case of his client to the best of his ability and that does not include using untamed language to describe the decision of a Court. It is bad enough that people disrespect a Court but coming from a lawyer is most disheartening and very unprofessional and unethical. The Appellant brief is signed by Francis Rotimi Adeniji. This means the language used in the brief are words that the learned counsel himself couched in the comfort of his office or home knowing fully well the meaning and implication of those words. This is how the Appellant’s counsel described an aspect of the judgment at page 6 paragraph 6.1 of the Appellant’s brief. This is what counsel wrote:
“The award of N1,000,000.00 damages to the Respondent, with due respect to the Learned trial judge was the most ridiculous aspect of the judgment.”
To describe the judgment of a Court as being ridiculous, to say the least, is most unfortunate particularly coming from a lawyer. Putting down a Court or a judgment is putting down the legal profession and this does not pay anyone. That does not necessarily make a counsel a good advocate. Maybe in the eyes of the public, a great one with cheerleaders supporting him but certainly not in a Court. To end this obiter comment, I adopt the advice his lordship Sankey, JCA gave to counsel in the case of Momodu vs. State (2007) LPELR-8380 (CA) on pages 63-65 as my advice for counsel. This is what his lordship said:
“…Counsel should strive to measure their words and the language they employ in challenging the decision and action of a judge. They are expected to display a dignified and respectful attitude towards a judge….Effective use of words, politeness of language and demeanor are the hallmark of a good advocate. It is certainly a breach of professional etiquette and against tradition to knowingly insult the judge and to ridicule the Court…No matter how ardently counsel feels about his client’s appeal, he must show level of decorium, civility in language, politeness and reverence in relation to the office of the judge…”

At this stage, I will drop the obiter comment and face issue 2 on the merit. The question is whether the general damages assessed at N1,000,000 is excessive. It is the submission of counsel that there was no evidence placed before the Court that warranted the award of the damage of N1,000,000. The Respondent submitted that the quantum of damages was reasonable given the facts of the case in relation to the value of the business in connection with which the injury was done to the Respondent. Is that really true? The lower Court on page 178 of the records, in my opinion, awarded general damages on the principle that once there is a wrong there is a remedy. See Young vs. Chevron (Nig) Ltd (2014) All FWLR (Pt. 747) 620.
The sum of N1,000,000 was awarded as damages on the premise that the Court has held that there was a passing off of the Respondent by the Appellant. The Court, however, in awarding general damages is to assess the damages based on an injury that naturally flowed from the wrong suffered by the Respondent. The gravity of the damages awarded will be based on an injury suffered naturally which flows from what the Respondent suffered. The apex Court in stating the principle upon which general damages will be awarded held in Elf Petroleum vs. Umah & Ors (2018) 1 SC (Pt. 1) 173; (2018) LPELR-43600 (SC) Ogunbiyi, JSC at page 27 thus:
“It is pertinent to re-iterate herein that in the award of General Damages, a wide spread power is given to the Court comparable to the exercise of discretion of the Court. It is enormous and therefore far-reaching and contrary to the contention held by the appellant herein. The measure of general damages is awarded to assuage such a loss, which flows naturally from the defendant’s act. It needs not be specifically pleaded. It suffices if it is generally averred. They are presumed to be the direct and probable consequence of that complained of.
Unlike special damages, it is generally incapable of exact calculation. See the following authorities of Federal Mortgage Finance Ltd V. Hope Effiong Ekpo (2004) 2 NWLR (Pt. 865) 100 at 132, Dumez V. Ogboli (1972), 2 SC 196 and WASA V. Kalla (1978) 3 SC 21.”
In Agbanelo vs. UBN Ltd(2000) 7 NWLR (Pt. 666) 534, the Supreme Court made a similar decision in these words:
“Before a Court can commence a meaningful assessment of damages, it must be sure of the nature of the claim, that is to say, whether the claim is in contract or in tort, and, if in tort, the nature of the wrong alleged.
I adopt the definition of the terms “damages” contained in the McGregor on Damages (16th Edition 1997) as follows (in paragraph 1):
“Damages are pecuniary compensation obtained by success in an action for a wrong which is either a tort or a breach of contract, the compensation being in the form of a lump sum awarded at the time, unconditionally and generally…”
In an action for breach of contract, the measure of damages is the loss flowing naturally from the breach and is incurred in direct consequence of the violation. (See Swiss-Nigeria Wood Industries Ltd. v. Bogo) (1970) 6 NSC 235). The principles guiding the award of damages in tort are different from those guiding the award of damages in contract. (See James v. Mid-Motors Nigeria Co. Ltd. (1978) 11 and 12 SC 31, (1978) 11 NSCC 536). The object of tort damages is to put the plaintiff in the position he would have been in if the tort had not been committed, whereas, the object of contract damages is to put the plaintiff in the position he would have been in if the contract had been satisfactorily performed.
Even if it had been clear that the claim is in the tort of negligence, there may be need for a further inquiry, whether the tortious conduct found has occasioned only economic loss and, if so, if it is within the variety of tortuous conduct for which the Court will award compensation for economic loss.”
In the same case Galadami, JSC held thus:
“The basic object of an award of damages is to compensate the plaintiff for the damages, loss or injury he has suffered. The guiding principle is restitution in integrum. The principle envisages that a party which has been damnified by the act which is called in question must be put in position in which he would have been if he had not suffered the wrong which he is now being compensated for. See NEPA v. R.O. ALLI & ANOR (1992) 10 SCNJ 34. ANAMBRA STATE ENVIRONMENTAL SANITATION AUTHORITY & ANOR v. EKWENEM (2009) 6-7 (Pt. II) SC 5.”
While the Respondent was not required in law to specifically prove what the action of the Appellant has caused her, there must be some element of proof to show that the Respondent suffered any form of injury as a result of the action of the Appellant. Once this is established then the gravity of what it suffered will determine the damages awarded. The lower Court, in my opinion, did not properly assess the injury suffered before awarding the cost for damages. In paragraph 19 of the statement of claim the Respondent stated what it has suffered as a result of the passing-off of the Respondent by the Appellant. All the averments in paragraph 19 did not show what the Respondent actually suffered for which he needs to be compensated for or for which restitution ought to be made. All the averments are speculative and there was no averment for any specific injury arising from the passing-off. In the circumstance, I agree that the N1,000,000 awarded as general damages is excessive in the light of the evidence before the lower Court. In the circumstance, when the lower Court has not properly assessed the damages, the appellate Court can do so and award damages that are proper within the circumstance of the case. In Williams vs. Daily Times of Nigeria Ltd (1990) 1 NWLR (Pt. 124) 1, the apex Court held:
“It is only when there is a failure to follow the settled principles that an appellate Court can properly interfere with the award of damages made by a trial Court. These principles which have been established by a legion of cases are:
(1) That the trial Judge acted on a wrong principle of law.
(2) That the Judge made an estimate of damages which is entirely erroneous, that is which no reasonable tribunal would have made and
(3) That the appellate Court is not disturbing the award of damages merely on the ground that it would have come to a different figure had it heard the case itself.”
See also Ogunsakin vs.Edu Local Govt. Area, Kwara State & Ors (2011) LPELR-8816 (CA).

Having looked at the evidence before the lower Court I come to the conclusion that the lower Court did not apply the principles properly in assessing the damage and therefore the N1,000,000 (One Thousand Naira) awarded as damages is excessive. I reduce the award to N300,000 (Three Hundred Thousand Naira).

In the whole, the decision of the lower Court, that is the Federal High Court delivered by I.A. Auta J. (as he then was) on 14/1/2010 in the matter of Pharmacia Corporation vs. Pharmacia Nigeria Limited- Suit No. FHC/L/CS/1223/07 is hereby affirmed except for the fact that the damages awarded is reduced to N300,000. The appeal therefore, fails in the main and it is dismissed except for the sum awarded as general damages. The amount as general damages is reduced to N300,000
The sum of N200,000 (Two Hundred Thousand Naira) is awarded as cost for this appeal in favour of the Respondent.

TIJJANI ABUBAKAR, J.C.A.: My learned brother EBIOWEI TOBI JCA granted me the privilege of reading in draft the leading Judgment just read in this appeal. I am in full agreement and therefore adopt the entire Judgment as mine.

GABRIEL OMONIYI KOLAWOLE, J.C.A.: I have had the privilege to read in its draft form, the leading judgment of my learned brother, EBIOWEI TOBI, JCA wherein he found instant appeal as lacking in merit and it, but reduced the sum as damages by the lower Court in favour of the Respondent.
I agree with the decision reached on the appeal and I abide with the consequential orders made as to costs.
I really do not have anything to add. The appeal is dismissed.

Appearances:

F.R. Adeniyi, Esq., with him, Diana Paul (Mrs.) For Appellant(s)

F. Olukoya Esq., with him O. O. Armogun For Respondent(s)