Breach Of Contract: Distributor Drags Visafone To Court


One of the major distributors of Visafone Communications Limited, Eri-Ere partners and investments Limited, has slammed N80 million suit on the telecommunications company over an alleged breach of contract and denial of price award winning promo.

In a statement of claim filed before a high court in Lagos, southwest Nigeria, on behalf of Eri-Ere Partners and Investments by a Lagos lawyer, Barrister Lekan Daramola, the claimant alleged that based on an agreement between the company and Visafone company, Eri-Ere company agreed to sell the defendant’s telecommunication products, aside this, the defendant organises special sales called “Promotions” from time to time and invites its distributors to partake in such promotional sales to increase its share of the telecommunication market in Nigeria.

It was also agreed by the defendant that the claimant shall pay a total commission of 16 per cent of the total sales the claimant was able to make for the defendant. Pursuant to this agreement, the claimant put in place necessary marketing arrangement and sold the defendant’s product to the tune of N39 million, thereby exceeding the N35 million target given by the defendant.

Though the defendant paid 5 per cent up front commission, it has refused to pay the 8 percent promotional commission and the 3 percent back end commission.

Similarly, at the behest of the defendant, the claimant took part as a Visafone strategic partner in defendant’s sales strategy tagged, “Grow your business promotion”, from November 2010 to January 2011.

However, the defendant has refused to release to the claimant, its promised reward/prize of a brand new bus, Hyundai Imax Executive Bus, 2011 model, the 3 per cent back end commission of N232,704,415.00 as commission on the sales and 2 per cent of the annual turn over of N1,015,236,398 and the cash award of approximately N698,113.24 in monetary terms based on the defendant’s products sold by the claimant during the promotion period.

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The claimant was more disturbed and embarrassed by the fact that the ceremonial presentation of the award in particular, the Hyundai bus, was done by the defendant publicly at the banquet hall of civic centre, Ozumba Mbadiwe Street, Victoria Island, Lagos on 9 March, 2011 and same was covered by the press.

It was further alleged that, in breach of the terms of agreement, the defendant failed to buy back the unsold stock of the claimant, thereby forcing the claimant to sell the said products at a loss.

The claimant averred that the defendant’s actions have denied the claimant its entitlement/reward under various business agreements, thereby making it to lose millions of naira, apart from various sums being held unto by the defendant.

Consequently, the claimant is claiming N80,940,412.85 with interest at the rate of 45 per cent per annum from January 2011, general damages as may be accessed by the court and the cost of instituting this legal action.

Justice Lawal Akapo adjourned the case for further hearing.

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