4/LAW REPORT
21.03.2017
NAFDAC’s Breach of Regulatory Duties to Fanta and Sprite Consumers in Nigeria
I
Facts n 2007, the 1st Claimant purchased from the 1st Defendant, about 4,300 crates of different soft drinks through different orders. Of the 1st Claimant's Order, only 1,899 crates were loaded and received at the designated port in United Kingdom by the Claimants. The Claimants made a deposit of N3,000,000.00 for the initial order of the products, of which the value of soft drinks supplied was N1,371,000.00 leaving an outstanding of N1,629,000.00. 1,277 empty crates of Coca Cola bottles were also deposited by the Claimants as an agreed pre-sale condition of the products. When the first consignments of drinks arrived in the United Kingdom, the contents and composition of the Fanta and Sprite products raised serious health related concerns by the Health Authorities. Specifically, the Stockport Metropolitan Borough Council’s Trading Standard Department of Environment and Economy Directorate’ report, which was corroborated by the Coca-Cola European Union, found that the products contained excessive levels of “Sunset Yellow” and “Benzoic Acid”, above the recommendation in the United Kingdom, and unsafe for human consumption. Owing to the foregoing, the products were seized and destroyed by the Authorities, resulting in appreciable financial losses to the Claimants. The Claimants contended that the 2nd Defendant failed to carry out necessary tests, to determine if the 1st Defendant’s products are safe for human consumption. The Claimants asserted that as registered Exporters with the Nigerian Export Promotion Council, they could lawfully export the products of the 1st Defendant, and the latter was aware that the products purchased were meant for export, because the containers used for loading the drinks from the 1st Defendant’s premises were marked for export. In its defence, the 1st Defendant asserted that the products manufactured by the company are meant for local distribution and consumption, as the drinks are not manufactured for export, the 1st Defendant being a local bottler. This assertion is in line with the fact that every country/jurisdiction has prescribed limits of components set by its regulatory authority. It was the 1st Defendant’s case that the percentage of chemical components in its drinks, particularly the benzoic acid, is well within the prescribed limit for human consumption set by the 2nd Defendant. It contended that there is no national limit set for the “sunset yellow” component of its Fanta orange products. The 1st Defendant placed reliance on the Certificate issued to it by the 2nd Defendant after rigorous inspection of its products, certifying the products safe for human consumption. At the trial, the 2nd Claimant (CW1) admitted that there are different levels of components tolerable by the regulation of different countries, and that there was no document to show that they informed the 1st Defendant that the products were meant for export. A subpoenaed Officer of the 2nd Defendant also testified in the matter. Her evidence was to the effect that the different standards in the composition in each jurisdiction are set by the countries, taking into consideration their environmental factors. Under cross-examination, she explained that Benzoic acid is a derivative of Sodium Benzoate, which at a level is no longer poisonous, but becomes harmful in the presence of Ascorbic Acid, which is Vitamin C. Issues for Determination The parties formulated various issues for determination but the Court adopted the issues formulated by the 1st Defendant: 1. Whether the 1st Defendant was negligent and breached the duty of care owed to its valuable customers including the 1st Claimant, in the production of its Fanta and Sprite soft drinks which allegedly contained excessive Sunset Yellow and Benzoic Acid. 2. If the answer to issue one is in the negative, whether the Claimants are entitled to the reliefs sought in their claims. The Court found that from the pleadings and evidence led, the following facts were not in dispute: 1. That the Claimants bought soft drinks from the 1st Defendant which were exported to the United Kingdom. 2. That the Coca Cola drinks were allowed into the United Kingdom while the Fanta and Sprite Soft drinks were destroyed on the basis that their components exceeded the recommended level adjudged safe for human consumption. 3. That the 2nd defendant is the regulatory body in Nigeria with responsibility of ensuring that the consumable products manufactured in the country are safe for human consumption. 4. That the 2nd Defendant, further to the Orders of
– (i) duty of care; (ii) breach of the duty of care; and (iii) damage caused by the breach. The 1st Defendant vehemently denied that its products were unsafe for human consumption and certificates issued by the 2nd Defendant to the 1st Defendant indeed, confirmed the safety standards of the soft drinks manufactured by the 1st Defendant. The report of the 2nd Defendant further to the Order of Court shows that sunset yellow in the Fanta was permitted, the Benzoic acid in the Sprite was found to be 161.5MG/L while the expected content fixed by NAFDAC was 250MG/L MAX. The Benzoic acid in Fanta showed 188.64MG/L compared to the figure of 250MG/LMAX expected by the 2nd Defendant. The head of Laboratory of the 2nd Defendant was unequivocal that the chemical components of the soft drinks were satisfactory and within the prescribed limit for consumption set by the authority. Thus, the 1st Defendant did not breach its duty of care.
Adedayo A. Oyebanji
In the High Court of Lagos State Holden at Lagos On Wednesday the 15th day of February, 2017 Before Her Ladyship Adedayo A. Oyebanji Judge, High Court of Lagos State Suit No. LD/13/2008 Between 1. Fijabi Adebo Holdings limited 2. Dr. Emmanuel Fijabi Adebo.............. Claimants And 1. Nigerian Bottling Company Plc 2. National Agency for Food and Drug Administration and Control (NAFDAC) .............Defendants
the Honourable Court on 13/10/2008 and 27/11/2008, carried out routine laboratory tests of all the soft drinks and allied products of the 1st Defendant and issued a report thereon. 5. That pursuant to the Court Order of 15/09/2008, the 1st Defendant refunded to the Claimants, the sum of N1,622,000, which had been received from the Claimants and by a latter Order, the empty crates deposited with the 1st Defendant were converted to cash and the sum refunded to the Claimants. Based on the foregoing, the Court held that the related parts of the reliefs sought by the Claimants have been overtaken by events. Arguments On the first issue for determination, it was stated that the three basic components of the tort of negligence are
".... THE 2ND DEFENDANT WAS GROSSLY IRRESPONSIBLE IN ITS REGULATORY DUTIES TO THE CONSUMERS OF FANTA AND SPRITE MANUFACTURED BY THE 1ST DEFENDANT, BY ITS CERTIFICATION OF THE DRINKS AS SATISFACTORY FOR HUMAN CONSUMPTION, PRODUCTS WHICH FAILED THE SAMPLE TEST FOR HUMAN CONSUMPTION IN THE UNITED KINGDOM"
Court’s Rationale and Judgement The Court held that on the first leg of the requirements, the 1st Defendant, being a manufacturer of soft drinks meant for consumption, must exercise reasonable care in the production of the drinks. Thus, the Claimants established the duty of care owed by the 1st Defendant to the Claimants and other consumers. With regard to the breach of the duty of care, the Court considered the letter from StockPort Metropolitan Borough Council with attached certificate of Analysis by Eurofins Laboratories Limited, United Kingdom and held that whilst from the contents it would appear that the 1st Defendant breached the duty of care to the Claimants and other consumers of its products in question, the evidence before the Court proves the contrary. The Court noted that the regulation governing the chemical component of the Coca- Cola products in Nigeria is different from that applicable in the United Kingdom, and that it is the duty of an exporter to ascertain the quality acceptable in the country of export, as failure to meet the standard in another country, cannot be laid at the door step of the manufacturer. The Court agreed that there was no evidence of the fact that the 1st Defendant was aware the products were for export; nonetheless, this is immaterial to its being fit for human consumption, as such drinks ought to be fit for human consumption irrespective of colour or creed In considering whether the Claimants are entitled to damages, the Court found that to be entitled to damages in cases of negligence, there must be a causal link with the breach of duty of care. Having come to the conclusion that there was no proof of the breach by the 1st Defendant, the claims against the 1st Defendant failed. With regard to the 2nd Defendant, the Court agreed that the only relief against it was actually complied with, further to the Order of the Pre-trial Judge. Nonetheless, the Court held that based on the evidence before it, the 2nd Defendant was grossly irresponsible in its regulatory duties to the consumers of Fanta and Sprite manufactured by the 1st Defendant, by its certification of the drinks as satisfactory for human consumption, products which failed the sample test for human consumption in the United Kingdom. More so, the drinks become poisonous in the presence of Ascorbic Acid known as Vitamin C, which can be freely taken by the unsuspecting public. Though different countries have different limits for additives, in the event that the applicable limit becomes unsafe for human consumption when taken with other consumables, there must be a clear warning to consumers on the effect of taking the products with other consumables. For the above reason, the Court directed the 2nd Defendant to mandate the 1st Defendant to, within 90 days from the date of judgement, include on all the bottles of Fanta and Sprite, soft drinks manufactured by the 1st Defendant, a written warning that the content becomes poisonous when taken with Vitamin C. Claimants’ claim failed. Costs of N2,000,000.00 (Two Million Naira) with 10% interest awarded in favour of the Claimants against the 2nd Defendant. Representation: Abiodun Onidare Esq. with Otaro Esq. and Nkem Amaechi (Miss) for the Claimants. T.O. Busari, SAN with Funke Oladosu (Miss), T.A. Sotayo Aro (Miss), Omolola Banjo (Miss) and K.A. Bamgbose Esq. for the 1st Defendant. No appearance for the 2nd Defendant. Reported by Optimum Publishers Limited (Publishers of Nigerian Monthly Law Reports (NMLR))