Nsejjere Casual and Sports Wear has not only sued Sulom for K3.1 billion but also dragged to court Wanderers Football Club seeking damages in excess of $1.5 million (about K480 million) for â€˜blatantâ€™ breach of contract.
The case against Wanderers, filed by lawyer Moses Nkhono of Lincoln, Edwards and Company on October 11 2012, is in the Lilongwe High Court.
Nkhono confirmed the development in an interview on Tuesday.
â€œThe total minimum order quantity per year being 20 000 T-shirts, at $12 per shirt for a period of seven years, during which the contract would have run. We also seek exemplary damages, the total value of opportunity costs by our client by virtue of the breach of contract which could yield.
â€œWe also seek interest on all the damages and cost of this action. It all is in excess of $1.5 million,â€ said Nkhono.
Court documents we have seen, which are not indicating the aggregated figure Nkhono has cited, show that Wanderers breached an exclusive written agreement in or around May, when they failed or ignored to use Nsejjere products and instead they started using Puma products without informing Nsejjere as per the contract which the two parties signed on April 2 2010.
â€œWanderers [defendant] signed a contract with Nsejjere [plaintiff] on April 2 2011 in which they agreed to enter into an exclusive supply agreement with the American firm where Nsejjere agreed to supply custom branding and commercialising products, which included but not limited to all sports apparel, accessories, headwear, footwear, flags, scarves, ball and other promotional items as well as service and Wanderers agreed to be bound by the terms of the agreement,â€ reads the statement of claim.
The claim further reads that Wanderers undertook to exclusively use the products supplied by Nsejjere to brand, promote and commercialise the club.
The club also agreed to order a minimum quantity of at least 20 000 T-shirts at a price of $12 per shirt or a combination of items totalling a monetary value of 200 000 T-shirts at the said quoted price per shirt.
Nkhono said it was an express term of the agreement that Wanderers FC would never use any other competitorâ€™s products which may be a substitute to the products supplied by Nsejjere during a seven-year period during which the exclusive supply agreement between the two parties would have to subsist.
In the agreement, it was agreed that Wanderers should inform Nsejjere should any competitor make an approach.
The court documents reveal that despite being aware of the contractual obligation to Nsejjere, Wanderers went ahead to use Puma products who are competitors of Nsejjere.
Wandererâ€™s general secretary David Kanyenda said they will comment on the issue once they study the summons.
â€œAs of now, I cannot say much. We will let you know what action we will take as a club once we have studied the charges as an executive,â€ Kanyenda said on Tuesday.
Nkhono, however, said they have not started legal cases against Big Bullets, Silver Strikers and Escom United, whom they also had similar deals, because they did nothing wrong.
â€œWith three other teams, it was Sulom who interfered with their contracts, but on their own, they were cooperative. They (the three teams) did understand the clauses of their contracts and its legal implications once breached,â€ said Nkhono.