CASE:
HARRISONS & CROSSFIELD ( NZ ) LTD V LIAN AIK HANG ( SUED AS A FIRM )
[ 1987 ] 2 MLJ 286, HC (SINGAPORE )
FACTS:
The defendants agreed to sell to the plaintiffs a maximum of 314 metric tons of peanut kernel of 60/70 pieces per ounce TBS ( ie Thai Brown Skin ) to be packed in new jute bags to be delivered to Auckland, New Zealand. The peanut kernels were to be form the ‘1980 Thailand Crop’ and payment was to be against the draft and bill of lading accompanied by ( a ) an Aflatoxin-free Certificate issued by the Singapore government; ( b ) a Certificate of Crop 1980; and ( c ) a Certificate that the goods were packed in sound clean bags not previously used for any purpose ( aflatoxins are carcinogenic toxins produced mainly by the mould known as aspergillus flavus )
After shipment of the goods, the defendants presented by the requisite documents (including an Aflatoxin-free Certificate issued by the Department of Scientific Service, Singapore) and were paid for the consignments.
When the goods arrived in Auckland, the plaintiffs rejected the goods on the grounds that the goods did not correspond with the samples and were of seriously inferior quality. They also alleged that the goods were not from the 1980 Thailand Crop and that some 20% of the peanut kernels were form an older crop. They further alleged that the goods were ‘unfit for human consumption and were by reason of the mould aflatoxin, age and degree of infestation by insects, of unmerchantable quality’. The defendants disputed this allegation and refused to reimburse the plaintiffs.
The evidence showed that all the shipments of peanut kernels contained a high level of aflatoxin, far in excess of the permissible limit of 15 parts per billion. The cause of problem was the condition of the peanut kernels and the presence of insects before shipment. The plaintiffs claimed the sum of US$535,244.08, or, alternatively, damages, interest and costs.


HELD:
The court was not satisfied that the samples delivered to the Departments of Scientific Service were representative of the peanut kernels shipped to the plaintiffs. The sale was a sale by sample, a fact not in dispute, and some 20% of what was tendered to the plaintiffs consisted of shriveled peanut kernels that were not aflatoxin-free. All three shipments contained aflatoxin far in excess of the permissible limit of 15 parts per billion. The goods supplied did not correspond to the description or sample. Judgment was entered for the plaintiffs.