Corporate authorisation and documentary proof of supply can establish debt, while excessive contractual interest may be reduced.
A company suit may be validly instituted through an authorised officer where a board resolution confers authority, and later conduct amounts to ratification despite minor procedural defects in the minutes. Supply and liability can be proved on a preponderance of probabilities through invoices, excise forms, balance confirmations, accounts and corroborating records; unsupported denial and failure to produce best evidence may attract adverse inference. Contractual interest on delayed payment may be awarded, but the court may reduce an excessive claimed rate and fix a lower equitable rate. A defendant alleging short supply must substantiate that defence with effective rebuttal evidence.
Issues: (i) Whether the suit was validly instituted by an authorised representative of the plaintiff company. (ii) Whether the plaintiff proved supply of goods and the defendants' liability to pay the suit amount. (iii) Whether the plaintiff was entitled to pendente lite and future interest at the claimed rate or at a reduced rate. (iv) Whether the defendants proved that the plaintiff had not supplied the quantity of beverages in accordance with the invoices.
Issue (i): Whether the suit was validly instituted by an authorised representative of the plaintiff company.
Analysis: The suit was instituted on the strength of a board resolution authorising the company's Assistant Company Secretary to sign, verify and file the proceedings. The absence of the company seal or signatures of all board members on the minutes did not undermine the resolution where the original minutes book was produced and the company consistently prosecuted the case through the authorised officer. Procedural defects that do not go to the root of the matter cannot defeat a substantive claim, and the conduct of the company amounted to ratification of the act of institution.
Conclusion: The suit was validly instituted. This issue was decided in favour of the plaintiff and against the defendants.
Issue (ii): Whether the plaintiff proved supply of goods and the defendants' liability to pay the suit amount.
Analysis: The plaintiff relied on invoices, excise forms L-32 and L-34, oral testimony and a balance confirmation letter. The evidence showed a consistent chain between the purchase permissions, the dispatch permissions and the invoices, and the Excise Department record corroborated the relevant L-34 forms. The defendants admitted business dealings and receipt of L-34 copies, but did not produce reliable contrary evidence. The balance confirmation letter and statement of accounts were also proved, and the accounts were supported by independent documentary evidence. In the circumstances, the defendants' denial of delivery and liability was not accepted and an adverse inference followed from their failure to produce best evidence.
Conclusion: The plaintiff proved the outstanding liability. This issue was decided in favour of the plaintiff and against the defendants.
Issue (iii): Whether the plaintiff was entitled to pendente lite and future interest at the claimed rate or at a reduced rate.
Analysis: The invoices provided for interest on delayed payment, and the plaintiff proved its interest calculation. Although the entitlement to interest was established, the contractual rate claimed was considered excessive in the facts of the case. The appropriate equitable rate was therefore fixed lower than the contractual rate.
Conclusion: The plaintiff was entitled to interest, but at 12% per annum instead of 24% per annum. This issue was decided in favour of the plaintiff in part.
Issue (iv): Whether the defendants proved that the plaintiff had not supplied the quantity of beverages in accordance with the invoices.
Analysis: The defendants bore the burden on this issue but failed to complete effective rebuttal evidence. Their witness did not establish any shortage or mismatch, while the plaintiff's evidence and the excise records supported the actual supply and dispatch of goods. The defence remained unsubstantiated and the documentary chain remained intact.
Conclusion: The defendants failed to prove shortage or non-supply. This issue was decided against the defendants.
Final Conclusion: The plaintiff succeeded in establishing the debt and was awarded a decree for the claimed principal amount with interest at a reduced rate and costs.
Ratio Decidendi: A company's suit is not defeated by technical defects in authorization where a board resolution or subsequent ratification establishes institutional approval, and supply/liability may be proved on a preponderance of probabilities through a consistent documentary chain corroborated by conduct and supporting records.
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