• Friday, March 01, 2024
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Legal and regulatory framework for courier and logistics operations in Nigeria

Nigeria’s last-mile delivery system needs improvement

With the growth of online businesses and increased consumerism, came the emergence of numerous courier and logistics companies providing immediate delivery of items purchased online to the doorstep of consumers. The swift courier and logistics services have erupted a new crop of commercial issues including but not limited to delay in delivery, loss or damage of items, delivery to a wrong address or person, theft of the dispatched items by riders and accidents. These commercial issues therefore call for a regulatory regime for the courier and logistics industry.

This article is the first part of two articles touching on the evolution of the regulatory framework governing the logistics and courier industry in Nigeria. More importantly, this article addresses the question of apportionment of liability, risk allocation and right of action among the courier company, the dispatch rider and a third-party beneficiary.

Regulatory regime for courier and logistics

Prior to the introduction of the Courier and Logistics Services (Operations) Regulations 2020 (the Regulation), the Courier Services (Operations) Regulations 1992 was in force. The 1992 regulations contained sparse provisions and created two licensing categories – national and international operators. At the time of this article, the courier and logistics business in Nigeria is primarily regulated by the Regulation, made pursuant to the Nigerian Postal Services Act, 2004 (NIPOST Act), and the NIPOST Act.

We note that unlike some common law jurisdictions as we will see below, there are no provisions in the Regulations or the NIPOST Act on the apportionment of risks imminent in the industry and the right to sue in the event of a breach. At best, the Regulation recognises the presence of a risk and in an attempt to provide a resolution mechanism stipulates in section 9 of the Regulation that licensed companies must establish clear procedure for handling and resolving complaints from customers within 30 days of such complaint. However, this does not adequately address the myriads of issues that have erupted from the continuous use of courier and logistics services, a lacuna which continues to occasion hardship to market players in that industry.

In Uganda, a common law jurisdiction, the Guidelines on Liability and Claims Procedure in Post and Courier Market makes elaborate provisions on several bugging issues in the industry particularly regarding the duty of care owed by courier companies to their customers, dispute settlement procedures and apportioning of liability in the event of non-delivery, wrong delivery, or damage of courier items.

In the absence of such comprehensive legal framework in Nigeria, the industry looks to the general principle of common law, contract and judicial authorities to determine party which bears liability in the event of a breach and has a right to institute an action before the courts.

Apportionment of risk and liability

It is pertinent to answer the question of which party bears liability in the event of a damage to goods or other form of damages occasioned during dispatch of goods by a courier company. The common law principle of vicarious liability is that an employer will be held liable for the harmful acts of its employees committed in the performance of their duties. Most of the courier companies operating in Nigeria except for a few hailing applications have an employer-employee relationship with their dispatch riders.

Read also: The need to scale Nigeria’s motor park logistics

In addressing the question of vicarious liability where there is damage to goods in transit, in the case of Morris v. CW Martins & Sons Ltd. (1996) 1QB 716, provides some insight. In that case, Mrs. Morris, the owner of a fur coat sent her coat to the defendant (a furrier) for cleaning, who later claimed the fur coat was lost while it was in their possession. Apparently, the cleaner responsible for cleaning the fur had stolen it. Mrs. Morris claimed that the defendant had not exercised reasonable care in maintaining the coat.

On appeal, Lord Denning established that the key question in establishing liability in that case was whether Mrs. Morris could sue the defendant for the theft of their employee. Quoting verbatim, he stated that, “from all these instances, we may deduce the general proposition that when a principal has in his charge the goods or belongings if another, in such circumstances that he is under a duty to take all reasonable precautions to protect them from theft, then if he entrusts that duty to a servant or agent, he is answerable for the manner in which that servant or agent himself steals them or makes away with them”. From this decision and on a general note, a courier company will be vicariously liable for any mishap except in certain circumstances in which the employer will be exempted.

It is expected that courts in Nigeria will follow this principle and hold courier companies liable for damages occasioned by the acts of their riders committed in the regular course of their employment subject to the regular exceptions.

This article will be continued in a further publication.

‘Debola is an Associate in the Mergers, Acquisitions and Private Equity practice of Olaniwun Ajayi LP where she advises individuals, indigenous and multinational entities on landmark corporate transactions.