CLEMENT OFORDUM v. EASY GEO INTERNATIONAL LIMITED
(2019)LCN/12749(CA)
In The Court of Appeal of Nigeria
On Wednesday, the 27th day of February, 2019
CA/L/826/15
RATIO
AGENCY: WHO IS AN AGENT
“An agency relationship exists between a principal and agent, and is characterized by the agent acting on behalf of the principal in relationships with third parties, with the aim that the Principal bears the liabilities and enjoys the benefits arising there from. The Supreme Court in the case of OSIGWE V. PSPLS MANAGEMENT CONSORTIUM LTD & ORS.(2009) LPELR-2807(SC), Per Ogbuagu, J.S.C. (Pp. 30-31, paras. C-C), defined an agent thus:
“who is an Agent” At page 64 of Black’s Law Dictionary, 7th Edition, an Agent is defined as, “One who is authorised to act for or in place of another, a representative”. The word “agent” or “agency” it is stated therein, denotes one who acts, a doer, etc. that accomplishes a thing or things. The agent normally, binds his principal and certainly not himself by the contract he makes. Indeed, this Court, in the case of Dr. Tunde Bamgboye v. University of llorin & Anor. (1999) 10 NWLR (Pt.622) 290 @ 329 also cited in the 1st, – 3rd, 5th – 8th and 10th -14th Respondents’ Brief (it is also reported in (1999) 6 SCNJ 295) – per Onu, JSC, the definition of an agent in the said Black’s Law Dictionary (Edition not stated), was stated thus: “A person authorized by another to act for him, one entrusted with another’s business …”” PER JAMILU YAMMAMA TUKUR J.C.A.
COURT AND PROCEDURE: WHETHER A PARTY CAN BE SUBSTITUTED
“There is no doubt that there are certain instances where a party may be substituted for another, especially in instance of death, but such a substitution is not automatic, and would depend on several factors, one of which is the fact that the cause of action must have survived the party. The Apex Court in the case of IN RE: APEH & ORS v. PDP & ORS (2017) LPELR-42035(SC),(Pp. 35-36, Paras. G-F) gave an exposition of the purpose of substitution” PER JAMILU YAMMAMA TUKUR J.C.A.
EVIDENCE: DUTY OF THE TRIAL COURT TO EVALUATE EVIDENCE
“The law indeed places a heavy duty and obligation upon the trial Court to properly evaluate the evidence before it and ascribe probative value to it. The Apex Court in the case of ANEKWE & ANOR v. NWEKE (2014) LPELR-22697(SC)(Pp. 30-33, paras. G-I)” PER JAMILU YAMMAMA TUKUR J.C.A.
JUSTICES
TOM SHAIBU YAKUBU Justice of The Court of Appeal of Nigeria
JAMILU YAMMAMA TUKUR Justice of The Court of Appeal of Nigeria
GABRIEL OMONIYI KOLAWOLE Justice of The Court of Appeal of Nigeria
Between
CLEMENT OFORDUM
(Trading under the name and style: CEE Ofordum Nigeria Enterprises) Appellant(s)
AND
EASY GEO INTERNATIONAL LIMITED Respondent(s)
JAMILU YAMMAMA TUKUR, J.C.A.(Delivering the Leading Judgment):
This is an Appeal against the Ruling of the High Court of Lagos State in Suit No. 1D/1882/2000 delivered on 1st June, 2012, by Honourable Justice D.T. Okuwobi (Mrs) against the Appellant.
The material facts of the case culminating in this appeal are that the Appellant instituted an action before the lower Court via a Writ of Summons dated 4th August, 2000, via which he sought monetary reliefs against the Respondent and one Geoffrey Asoegwu (Deceased struck out as a party upon his demise, via order of the lower Court made on 1st November 2011 see pages 162 – 163 of the Record of Appeal. Based on debt owed arising from goods supplied to the Respondent which were to be sold and the money arising there from to be remitted to the Appellant. The Appellant via an application dated 13th September, 2011, sought for the substitution of the erstwhile 2nd Defendant with his wife, Mrs. Benedict Uzoma Asoegwu.
In a Ruling dated 1st June, 2012, the lower Court found the application lacking in merit and dismissed same.
Dissatisfied with the above, the Appellant appealed to this Court vide a Notice of Appeal dated 24th September, 2012 filed on 21-5-15 with six grounds of appeal. (pages 173 – 182 of the Record).
The Appellant’s Brief of Argument settled by Ike Okocha Esq., of Ike Okocha & Associates is dated and filed on 30th September, 2015.
Appellant’s counsel formulated three issues for determination to wit:
1.Whether in all the circumstances of this case, the deceased 2nd Defendant acted as the agent of the Respondent as held by the learned trial Judge.
2. Whether the learned trial Judge was right in holding that the party sought to be made a second Defendant in this suit has no liability in law when the Respondent company is still a party in the suit.
3. Whether the learned trial Judge was right in finding that the Appellant?s application in issue in this appeal is lacking in merit and thereby dismissed it.
The Appeal was heard surely on Appellants brief only in line with the order of this Court made on 28-11-16 upon application by the Appellant.
ISSUE ONE
WHETHER IN ALL THE CIRCUMSTANCES OF THIS CASE, THE DECEASED 2ND DEFENDANT ACTED AS THE AGENT OF THE RESPONDENT AS HELD BY THE LEARNED TRIAL JUDGE.
Learned counsel for the Appellant argued that the deceased 2nd Defendant whose name was struck out was not the agent of the Respondent as there was no agency relationship between them. He submitted further that the Respondent and the Deceased were practically the same entity, as shown by the ownership and control of the Respondent by the Deceased Defendant.
He relied on Section 244 (1) of the Companies and Allied Matters Act, 2004; Bamgboye v. University of Ilorin (2001) FWLR (Pt.32) 12 at 32 ratio 38; and Vulcan Gases Ltd v. GFIG (2001) FWLR (Pt.53) 1, 7 Ratio 6.
Learned counsel also argued that the 2nd Defendant’s admission of paragraph 3 of the Statement of Claim, to the effect that the Deceased Defendant, made use of the subject matter of the action for personal use and not on behalf of the Respondent shows he was not the Respondent’s agent.
He relied on Fasuyan v. Nitel (2003) 1 FWLR (Pt.187) 370, 390, para. C.
RESOLUTION
An agency relationship exists between a principal and agent, and is characterized by the agent acting on behalf of the principal in relationships with third parties, with the aim that the Principal bears the liabilities and enjoys the benefits arising there from.
The Supreme Court in the case of OSIGWE V. PSPLS MANAGEMENT CONSORTIUM LTD & ORS.(2009) LPELR-2807(SC), Per Ogbuagu, J.S.C. (Pp. 30-31, paras. C-C), defined an agent thus:
“who is an Agent” At page 64 of Black’s Law Dictionary, 7th Edition, an Agent is defined as, “One who is authorised to act for or in place of another, a representative”. The word “agent” or “agency” it is stated therein, denotes one who acts, a doer, etc. that accomplishes a thing or things. The agent normally, binds his principal and certainly not himself by the contract he makes. Indeed, this Court, in the case of Dr. Tunde Bamgboye v. University of llorin & Anor. (1999) 10 NWLR (Pt.622) 290 @ 329 also cited in the 1st, – 3rd, 5th – 8th and 10th -14th Respondents’ Brief (it is also reported in (1999) 6 SCNJ 295) – per Onu, JSC, the definition of an agent in the said Black’s Law Dictionary (Edition not stated), was stated thus: “A person authorized by another to act for him, one entrusted with another’s business …”
One authorised to transact all business of principal (sic), all of principal business of some particular kind, or all business of some particular place, etc.”. His Lordship, then stated inter alia, as follows: “An agent, in my view, means more or less the same thing as a delegate”. In the case of Niger Progress Ltd. v. North East Line Corporation (1989) 3 NWLR (Pt. 107) 68 @ 92, – per Nnamani, JSC, (of blessed memory) also cited in the Briefs of the 1st – 3rd, 4th, 5th – 8th and 10th – 14th Respondents (it is also reported in (1989) 4 SCNJ 232), it was stated that a relationship of Agency is generally said to exist whenever one person called the “agent” has authority to act on behalf of another called “the Principal” and consents to the act.”
See: THE REGISTERED TRUSTEES OF THE ASSEMBLIES OF GOD MISSION V. MANCHIN (2013) LPELR-20778 (CA); and AKANWA v. OGBAGA (2016) LPELR-41054(CA).
Generally speaking, a Director is an agent of the Company, a legal person who cannot act on its own but acts through its Directors and principal officers. When a Director acts, and purports to act for a company, the law presumes that the acts are those of the company, because the Director is the alter ego of the Company. The Supreme Court stated this settled principle of law in the case of OKOLO & ANOR. V. U.B.N. LTD.(2004) LPELR-2465(SC), Per. TOBI, J.S.C (P. 32, paras. A-C)
‘…a director of a company is, in the eyes of the law, an agent of the company for which he acts and the general principle of the law of principal and agent would apply. Thus, where a director enters into a contract in the name of or purporting to bind the company, it is the company, the principal, which is liable on it, not the director”.
See:ORIEBOSI v. ANDY SAM INVESTMENT COMPANY LTD(2014) LPELR-23607(CA); and RAINSON INDUSTRIES LTD v. ABIA STATE COMMISSIONER FOR HEALTH AND SOCIAL WELFARE & ORS (2014) LPELR-23771(CA).
A look at the facts of the case at trial, reveals that the Deceased Defendant was indeed the agent of the Respondent, as the business transaction was between the Appellant and the Respondent.
This issue is consequently resolved against the Appellant.
ISSUE TWO
WHETHER THE LEARNED TRIAL JUDGE WAS RIGHT IN HOLDING THAT THE PARTY SOUGHT TO BE MADE A SECOND DEFENDANT IN THIS SUIT HAS NO LIABILITY IN LAW WHEN THE RESPONDENT COMPANY IS STILL A PARTY IN THE SUIT.
Learned counsel for the Appellant argued that the cause of action is the Appellant’s claim for N5,985,295.90, belonging to foreign manufacturers, which the Deceased Defendant fraudulently appropriated, and the cause of action survived the Deceased Defendant.
He relied on: Order 13 Rule 29 of the High Court of Lagos State Civil Procedure Rules 2015; Bintumi v. Fantami (1998) 13 NWLR (Pt.581) 264; AG Federation v. Abubakar (2007) 10 NWLR (Pt.1041) 1 SC; SPDC v. XM Federal Ltd (2006) All FWLR (Pt.339) 822 SC; and AG Federation v. ANPP (2003) 12 SCN 671.
Learned counsel also argued that the fact that the Respondent and the deceased Defendant were sued jointly and severally meant that any of them could be made liable to the Appellant’s claim at trial. Counsel further submitted that the fraudulent nature of the deceased Defendant’s actions meant that the Deceased could be held personally liable for the claim, as opposed to the Respondent, who is a nominal party.
He relied on: Section 290 of the Companies and Allied Matters Act, 1990; Public Finance Securities Ltd v. Jefia (1998) 3 NWLR (Pt.543) 602 CA.
The party seeking to be substituted for the deceased Defendant ought to be joined because she is the personal representative of the Deceased, she is a necessary party and the proceeds of the Deceased?s action in question, which is the subject matter of the suit are in her hands.
He relied on the following cases:
Ojo v. Ogbe (2007) 9 NWLR (Pt.1040) 542 CA; Mobil Oil Plc v. DENR Ltd (2004) 1 NWLR (Pt.853) 142 CA; Yakubu v. Gov. Kogi State (1995) 8 NWLR (Pt.414) 386 SC; and Ogunbule v. Adebanjo (2006) 2 NWLR (Pt.964) 319 CA.
RESOLUTION
There is no doubt that there are certain instances where a party may be substituted for another, especially in instance of death, but such a substitution is not automatic, and would depend on several factors, one of which is the fact that the cause of action must have survived the party.
The Apex Court in the case of IN RE: APEH & ORS v. PDP & ORS (2017) LPELR-42035(SC),(Pp. 35-36, Paras. G-F) gave an exposition of the purpose of substitution, where per Per MUHAMMAD, J.S.C., held thus:
“I think it is apt for me at this stage, to remind my noble lords, in a concise manner the general principles of the law relating to substitution. When one puts something by way of replacement or change of another, whether a person or a thing, that would amount to substitution. The law may permit a person to substitute another in a law suit (including appeal) where there is a genuine case of death, bankruptcy, assignment, transmission or devolution of interest or liability of a party to the suit or appeal, where the need to substitute is obvious in fact and in law. Where a party is dead, he cannot physically take part any more in the proceedings. His position must necessarily be taken over by the beneficiary who inherits him and who subsequently inherits the litigation. Otherwise, the action for or against the deceased will abate unless appropriate steps are taken to substitute a living person for the deceased. See Eyesan v. Sanusi (1984) 4 SC 115 at p. 137. Bankruptcy of one of the parties to a suit while the suit is pending, may also abate except where a trustee(s) takes over. Comprehensive rules are made by the various (now unified) High Court Rules which take care of such circumstances.” See: NAGARTA INTEGRATED FARMS LTD v. NAGODA & ORS (2016) LPELR-40266(CA); HADEJIA v. LADAN & ORS (2017) LPELR-43368(CA); and ABU & ANOR v. KURA & ORS (2017) LPELR-42489(CA).
The crucial question is whether the reason for substitution was such as should grant the order and the answer is in my view in the negative. The liability is one that was incurred by the Respondent and though the Deceased Defendant was sued alongside, there is no reason in law for the Deceased’s wife to be substituted for her husband.
It is trite law that a company is a distinct person in law, and is generally liable for its actions. One of the most attractive features of incorporation or corporate personality is that the Directors and shareholders are not liable for the company’s liabilities. The liability of the members are limited to the amount unpaid on their shares if any.
See: ISOKO COMMUNITY BANK LTD v. EDOFREN (NIG) LTD & ORS (2018) LPELR-44998 (CA); and ADEWUMI v. ADEBEST TELECOMMUNICATIONS NIGERIA LIMITED (2011) LPELR-9087(CA).
This Court in FAIRLINE PHARMACEUTICAL INDUSTRIES LTD & ANOR V. TRUST ADJUSTERS NIG. LTD (2012) LPELR-20860(CA)(P. 30, Paras. C-G), correctly stated the principle of law with regards to where a Director would be personally liable for the debts of a company, thus:
“…it is the law that, a company being an artificial person cannot act on its own person. It can only act through directors and therefore the acts of the directors is merely that of ordinary case of principal and agent. In other words, where a director enters into a contract in the name of an incorporated body, it is the company, the principal, which is liable not the director. The director is therefore not personally liable, unless it appears that he undertook personal liability such as, where he signs the contractual document without signifying that he was signing on behalf of the company. In other words, where a director signs a contract in his name without disclosing either the name or the existence of a principal, he would be held liable personally in the contract to the other party to the contract, even though he is in fact acting on the principal’s behalf. See B.B. APUGO & SONS LTD v. O.H.M.B. (2005) 17 NWLR (PT.954) PG.305 and ATAGUBA & CO v. GURA (NIG.) LTD. (2005) 8 NWLR See: CHARTERED BRAINS LIMITED & ANOR v. INTERCITY BANK PLC(2009) LPELR-8697(CA).
From the above, it is clear that the party seeking to be substituted for the Deceased Defendant, ought not to be joined, as doing so would amount to ascribing personal liability to a Director for a contract entered into by a company.
This issue is also resolved against the Appellant.
ISSUE THREE
WHETHER THE LEARNED TRIAL JUDGE WAS RIGHT IN FINDING THAT THE APPELLANT?S APPLICATION IN ISSUE IN THIS APPEAL IS LACKING IN MERIT AND THEREBY DISMISSED IT.
Learned counsel argued that the learned trial Judge failed to properly evaluate the evidence furnished in support of the application and did not ascribe proper value to the affidavit in support, particularly paragraph 5 and 6 therefore.
He cited the cases of Kwajaffa & Ors v. Bank of the North (2004) 8 MJSC 106 ratio 6; Solomon v. Mogaji (1982) 11 SC 1; and So Mai Sonka Ltd v. Adzege (2001) FWLR (Pt.68) 1104, 1118 paras F-H.
He also argued that the trial Judge failed to properly examine the correct processes as instead of carefully examining the Amended Statement of Claim, especially paragraphs 36, 37, 38, he apparently only took a cursory look at the old Statement of Claim.
He cited the cases of Oseyomon v. Ojo (1997) SCNJ 365, 381; and Oguma v. IBWA (1988) 1 NWLR 659.
He submitted that the above failure to properly evaluate the evidence resulted in miscarriage of justice and the wrong decision to dismiss the Appellant’s application.
He cited the cases of Okwueze v. Ejiofor (2001) FWLR (Pt.48) 1277, 1279 para F; and Adebayo v. Adusei (2004) 4 NWLR (Pt.862) 44.
RESOLUTION
The law indeed places a heavy duty and obligation upon the trial Court to properly evaluate the evidence before it and ascribe probative value to it. The Apex Court in the case of ANEKWE & ANOR v. NWEKE (2014) LPELR-22697(SC)(Pp. 30-33, paras. G-I), Per OGUNBIYI, J.S.C., restated the settled principle of law with regards to evaluation of evidence thus:
“…As rightly submitted by the learned counsel for the appellants, the evaluation of evidence involves the consideration of each set of evidence given by the parties, the determination of the credibility of the respective witnesses and the ascription of probative value to the evidence evaluated. This fundamental principle has long been laid down by this Court in the case of Mogaji V. Odofin (1978) 3 – 4 SC page 65 at 67 wherein Fatayi-Williams reading the lead judgment said:- “In short, before a judge before whom evidence is adduced by the parties before him in a civil case comes to a decision as to which evidence he believes or accepts and which evidence he rejects he should first of all put the totality of the testimony adduced by both parties on that imaginary scale; he will put the evidence adduced by the plaintiff on one side of the scale and that of the defendant on the other side and weigh them together. He will then see which is heavier not by the number of witnesses called by each party but by the quality or the probative value of the testimony of those witnesses. This is what is meant when it is said that a civil case is decided on the balance of probabilities. Therefore, in determining which is heavier, the judge will naturally have regard to the following:- a. Whether the evidence is admissible: b. Whether it is relevant; c. Whether it is credible; d. Whether it is conclusive; and e. Whether it is more probable than that given by the other party. Finally, after invoking the law, if any, that is applicable to the case, the trial judge will then come to his final conclusion based on the evidence which he has accepted.”
See:EYIBOH v. ABIA & ORS (2012) LPELR-20607(SC); GEO MEMORIAL MEDICAL CENTRE & ANOR V. NATIONAL DIRECTORATE OF EMPLOYMENT (2013) LPELR-20796 (CA); ERIKI v. ERIKI & ORS (2017) LPELR-42423(CA).
A look at the Ruling of the trial Court in question reveals that the Court properly evaluated the evidence in support of the application, which was principally contained in the affidavit in support of the application dated 13th September, 2011, found at page 144 of the records. The Court identified the main issues at stake, sifted the relevant facts and applied the correct principles of law.
A look at paragraphs 36, 37 and 38 of the Appellant’s Amended Statement of Claim at page 18 of the records, reveal that they border on the alleged way in which the Deceased Defendant spent the money which the Respondent ought to have remitted to the Appellant.
I therefore do not find any basis to disturb the findings of the lower Court on the evidence placed before it. This issue is also resolved against the Appellant.
In summation, I find the Appeal as lacking in merit and same is dismissed. The Ruling of the lower Court delivered on 1st June 2012 is affirmed. Parties to bear their respective costs of prosecution the Appeal.
TOM SHAIBU YAKUBU, J.C.A.: I had the advantage of a preview of the judgment rendered by my learned brother, JAMILU YAMMAMA TUKUR, J.C.A. I am in agreement with the resolutions of the issues thrown up in the appeal by his Lordship.
I, too dismiss the appeal for being devoid of merits. Each side shall bear own costs.
GABRIEL OMONIYI KOLAWOLE, J.C.A.: I have had the privilege of reading in advance, the lead judgment just delivered by my learned brother, JAMILU YAMMAMA TUKUR, J.C.A. wherein he dismissed the appeal of the Appellant which was in fact argued only on the Appellant’s Brief of Argument.
I really have nothing of value to add to the clear analysis and reasoning of my learned brother with which I concur that the instant appeal lacks merit and should be dismissed. I abide with the order as to cost made in the lead judgment.
Appearances:
Ike Okocha with him, Emelda NwolisaFor Appellant(s)
For Respondent(s)
