FCMB v. JOHN ANDY & SONS CO. LTD (2021)

FCMB v. JOHN ANDY & SONS CO. LTD

(2021)LCN/15019(CA)

In The Court Of Appeal

(CALABAR JUDICIAL DIVISION)

On Tuesday, February 16, 2021

CA/C/453/2014

RATIO

EVIDENCE: EFFECT OF FACTS ADMITTED

This is on the principle that whatever is admitted needs no further proof. See Section 123 Evidence Act 2011. See EGBUNIKE & ANOR. VS. ACB LTD. (1995) 2 SCNJ 58. PER MOJEED ADEKUNLE OWOADE, J.C.A.
COMPANY LAW: WAYS OF PROVING THE JURISTIC PERSONALITY OF A COMPANY

Indeed, the decision of the Court of Appeal, Abuja Division per Aboki JCA in the case of HOUSE OF REPS. VS. S.P.D.C.N. (supra) followed the case of A.C.B. PLC VS. EMOSTRADE LTD. (2002) 8 NWLR (pt. 770) 501 to re-emphasize the position of the law that it is only when the juristic personality of a corporate body is challenged and issues joined that such a corporate body can prove its juristic personality by production of its certificate. PER MOJEED ADEKUNLE OWOADE, J.C.A.

COMPANY LAW: LIFTING THE VEIL OF INCORPORATION

Clearly a company does not have a mind or a hand of its own, it has to act through human persons. Therefore, any of its agents or servants can testify or give evidence to establish any transaction entered into by the company. See ISHOLA VS. SOCIETE GENERALE BANK (NIG.) LTD. (1997) 2 NWLR (pt. 488) 405 SC; U.B.N. VS. JASE MOTORS (NIG.) LTD. (1997) 7 NWLR (pt. 513) 387. PER MOJEED ADEKUNLE OWOADE, J.C.A.
CONTRACT: RULE APPLICABLE IN THE CONSTRUCTION OF TERMS OF A CONTRACT

Secondly, in the construction of the terms of a contract, the meaning to be placed on it, is that which is the plain, clear and obvious result of the terms used. A contract or document is to be construed in its ordinary meaning as question of fact. Thus, where the words of a contract agreement or document are clear, the operative words in it should be given their simple and ordinary grammatical meaning. See DALEK (NIG.) VS. OMPADEC (2007) 7 NWLR (pt. 1033) 402 SC; U. B. N. LTD. VS. SAX (NIG.) LTD. (1994) 8 NWLR (pt. 361) 402 SC; UNION BANK OF NIGERIA LTD. VS. OZIGI (1991) 2 NWLR (pt. 176) 677. PER MOJEED ADEKUNLE OWOADE, J.C.A.

Before Our Lordships:

Mojeed Adekunle Owoade Justice of the Court of Appeal

James Shehu Abiriyi Justice of the Court of Appeal

Muhammed Lawal Shuaibu Justice of the Court of Appeal

Between

FIRST CITY MONUMENT BANK APPELANT(S)

And

JOHN ANDY & SONS CO. LTD. RESPONDENT(S)

MOJEED ADEKUNLE OWOADE, J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of the Akwa Ibom State High Court, Uyo Judicial Division in Suit No: HU/54/2004 delivered by Hon. Justice Philomena Etim on the 5th day of May, 2014.

The Respondent as Plaintiff on the 12th day of February, 2004 took out a Writ of Summons against the Appellant/Defendant then known as First Atlantic Bank Limited claiming as follows:
“(a) An order of specific performance on the Defendant to lease the property of the Plaintiff situate at Aka Road, Uyo, Akwa Ibom State for a period of 20 (Twenty) years at N1,000,000.00 (One Million Naira) per annum renegotiable after the first ten years in terms of the agreement between Plaintiff and Defendant or in the alternative.
(b) N50,000,000.00 (Fifty Million Naira) damages for breach of contract.”

Pleadings were filed and exchanged and at the trial each of the parties called one witness and tendered several documents in support of its case.

The learned trial judge delivered his judgment on 5th May, 2014 and held that having regards to the surrounding

circumstances of the case including all the written statement made and the exhibits tendered, it was easy to discover the intention of the parties as well as their decision as expressed in them. He found that there was a lease/contract between the parties. But that the Defendant (Appellant) is in breach of that lease/contract and is liable to pay damages.

The learned trial judge proceeded to award N10,000,000.00 damages for breach without any order of specific performance.

Dissatisfied with the judgment, the Appellant at first filed a Notice of Appeal containing three grounds of appeal and later on 14th January, 2021 filed an Amended Notice of Appeal containing four (4) grounds of appeal.

Appellant’s briefs of Argument was filed on 8th May, 2015 but was deemed filed on 18th January, 2021. It is settled by U. F. Ibiok.

Respondent’s brief of Argument was filed on 4th February, 2019 but also deemed filed on 18th January, 2021.

Learned counsel for the Appellant nominated four issues for determination of the appeal.
They are:
1. Whether the Plaintiff (Respondent) did prove her legal capacity to sue and sustain the case.

Whether the Plaintiff (Respondent) disclosed her locus standi to sustain this suit.
3. Whether there was a valid contract between the Plaintiff/Respondent and the Defendant/Appellant in this case.
4. Whether the judgment is not against the weight of evidence.

Learned counsel for the Respondent adopted the issues nominated by the Appellant.

On issue 1, learned counsel for the Appellant submitted that the Respondent is identified as ‘John Andy & Sons Limited’ and is said to be a Limited Liability Company whereby the Respondent proceeded to plead the Certificate of Incorporation which was to be relied upon at the trial of the suit.

He submitted that the legal personality of a corporate body can only be established as a matter of law by the production in evidence of the Certificate of Incorporation, notwithstanding admission between the parties. He referred to the cases of HOUSE OF REPS. VS. S.P.C.D.N (2010) 11 NWLR (pt. 1205) 213 at 219; APOSTOLIC CHURCH VS. AG, MID. WEST (1972) NSCC 247, (1972) ALL NLR 359.

He urged us to hold that the Respondent had a duty to prove her legal personality to sue

despite admissions on the part of the Appellant and that to do so the law requires the production in evidence of the Certificate of Incorporation. That having failed to discharge these duties, the Respondent cannot sustain the matter as a party.

On issue 1, learned counsel for the Respondent submitted that throughout the trial in the Court below, the Appellant did not challenge the legal personality of the Respondent.

That indeed in paragraph 1 of the Statement of Defence, the Appellant admitted that the Respondent is a legal personality and proceeded in paragraph 3 thereof to state that it negotiated the property in issue not with the Respondent but with Eno. J. Andy and Jones J. Andy.

He mentioned that Appellant’s ground 4 of the Amended Notice of Appeal and issue 1 are new issues raised and argued without leave of Court.

He submitted that the authority of the REGISTERED TRUSTEES, APOSTOLIC CHURCH ETC VS. ATTORNEY GENEREAL, MID WESTERN STATE OF NIGERIA & ORS. (1972) ALL NLR 359 relied on by the Appellant in support of the argument of issue No. 1 is different from this case in that unlike in this case, the Defendant in the

APOSTOLIC CHURCH case (supra) specifically challenged the legal capacity of the Plaintiff and put them to the strictest proof of their legal capacity.

That in this case, the Appellant did not challenge the legal capacity of the Respondent and indeed admitted it in paragraph 1 of the statement of Defence. The Respondent was therefore under no duty to prove its legal personality.

Appellant’s argument on issue No. 1 cannot indeed be countenanced. This is on the principle that whatever is admitted needs no further proof. See Section 123 Evidence Act 2011. See EGBUNIKE & ANOR. VS. ACB LTD. (1995) 2 SCNJ 58.
In the instant case, the Respondent pleaded that it is a registered Limited Liability Company and same was admitted in paragraph 1 of the Appellant’s Statement of Defence. The Respondent was no longer to prove the fact of its been a registered Limited Liability Company in the absence of any challenge by the Appellant and indeed in the presence of an admission by the Appellant.
In the case of HOUSE OF REPS. VS. S.P.D.C.N. (2010) 11 NWLR (pt. 1205) 213 cited by the learned counsel for the Appellant, there was a specific challenge of

the juristic personality of the applicant in that case unlike the case at hand.
Also, the case of APOSTOLIC CHURCH VS. A-G, MID. WEST (supra) equally relied on by the Appellant is distinguishable from the present case. In the APOSTOLIC CHURCH case (supra), the Plaintiff did not furnish any evidence of its juristic person, thus admission by the defendant could not constitute proof of the plaintiff’s juristic personality because one cannot admit to a non-existing fact.
In the instant case, the Appellant admitted the Respondent’s pleading that it is a registered corporate entity and by the admission of same in the Appellant’s Statement of Defence the fact is deemed established.
Indeed, the decision of the Court of Appeal, Abuja Division per Aboki JCA in the case of HOUSE OF REPS. VS. S.P.D.C.N. (supra) followed the case of A.C.B. PLC VS. EMOSTRADE LTD. (2002) 8 NWLR (pt. 770) 501 to re-emphasize the position of the law that it is only when the juristic personality of a corporate body is challenged and issues joined that such a corporate body can prove its juristic personality by production of its certificate.

In the instant case, the circumstances are such that the Respondent was not obliged to produce its Certificate of Incorporation.

Issue No. 1 is resolved against the Appellant.

On issue No. 2, learned counsel for the Appellant submitted that there are two named owners of the property that was to be leased, to wit, Eno Jones Andy and Jones Jones Andy and there is no evidence that these persons authorized the Respondent to protect and/or defend their interests in this property in issue.

He submitted that the claim of the Respondent is that she had a building constructed to meet the specifications supplied by the Appellant which the Appellant was to lease for 10 years. But, that in proving her case, Exhibit 5, being the approved building plan was tendered by her. However, that the said Exhibit 5 discloses other persons apart from the Respondent as the owners of the property.

Admittedly, according to Appellant’s counsel, one Eno Jones Andy testified as PW1 for the Respondent, but that the PW1 is separate and distinct in person from the Respondent.

He urged us to hold that the Respondent failed to disclose any or sufficient interest in the right

sought to be enforced in this matter and the suit ought to have been struck out.

On issue No. 2, learned counsel for the Respondent referred us to Exhibits 2, 3, 6, and 7 being the series of correspondence between the Appellant and the Respondent. That there was no doubt from those Exhibits about the ownership of the property and that the Appellant did not challenge the title of the Respondent to the property in the Court below.

He submitted that the approved building plan Exhibit 5 is not evidence of title and was not relied on by the Appellant in negotiations of the lease with the Respondent.

He concluded that Exhibit 5 which the Appellant relied on in raising the issue of absence of locus standi to sue was discarded by the Appellant and was not contemplated by the parties in their negotiations. He urged us to resolve the issue in favour of the Respondent.

The evidence adduced in this case supports the locus standi of the Respondent as a corporate juristic personality to institute the action against the Appellant. PW1 gave evidence as a director of the Respondent. Clearly a company does not have a mind or a hand of its own, it has to

act through human persons. Therefore, any of its agents or servants can testify or give evidence to establish any transaction entered into by the company. See ISHOLA VS. SOCIETE GENERALE BANK (NIG.) LTD. (1997) 2 NWLR (pt. 488) 405 SC; U.B.N. VS. JASE MOTORS (NIG.) LTD. (1997) 7 NWLR (pt. 513) 387.
Secondly, and as rightly pointed out by the learned counsel for the Respondent, Exhibit 5 (Approved Building Plan) sought to be relied on by the Appellant to argue that the Appellant has no locus standi is indeed not evidence or proof of title. More importantly, the existence or mention of Exhibit 5 cannot contradict the evidence as established on record that the Appellant knew throughout the transaction between the parties that it was dealing with the Respondent through its agents and servants.
The Respondent in the instant case has established its locus standi by evidence adduced during trial. Issue No. 2 is resolved against the Appellant.

On issue No. 3, learned counsel for the Appellant submitted that the negotiation to lease was inconclusive and the Court cannot hold that there was a valid and enforceable contract.

He stated that in Exhibit 3 being the letter dated April 17, 2002 from the Respondent to the Appellant, it is apparent from the opening sentence that there had been series of negotiations before then but goes on to state the desire of the Defendant to go ahead with the lease provided:-
a. The property is ready by the end of May to enable the taking over of possession in the first week of June.
b. The Plaintiff ensures strict compliance with the specifications provided by the Defendant.
c. The Plaintiff’s approval of a formal agreement was needed; and
d. Payment was to be made on the 8th of July, 2002.

The Plaintiff never wrote to accept these conditions and never met the terms either. The Appellant in Exhibit 7A gives non-compliance with the terms demanded in Exhibit 3 as the reason for not concluding the contract.
He referred to the case of CHUKWUMA VS. IFELOYE (2008) 18 NWLR (pt. 1118) 204 at page 214.

He submitted that the Respondent never accepted the demands of the Appellant in Exhibit 3 by words, deeds or writing. The Respondent rather did not make available the building in a tenantable state by the end of May, 2002. Exhibit 5 being the

approved building plan for the building tendered by the Respondent shows the approval of the building plan for the construction of the building was given on the 14th day of April, 2005 i.e. 2 years and eleven months after the Appellant had wanted the building ready.

He submitted that the onus is on the person who seeks to enforce his right under a contract to show that he has fulfilled all the conditions precedent, and that he has performed all those terms which ought to have been performed by him. Where the Plaintiff fails or defaults in the discharge of his own obligations under the contract, the action must fail. He referred to EZENWA VS. OKO (2008) 3 NWLR (pt. 1075) 610 – 617.

Appellant’s counsel submitted that the other demands in Exhibit 3 were that there was to be strict compliance with the building specifications submitted by the Appellant and also that the Respondent’s approval of a formal agreement was needed.

In respect of the latter condition, Appellant referred to the case of UBA VS. TEJUMOLA & SONS LTD. (1988) 2 NWLR (pt. 79) 662 to say that the effect of the latter condition is that the incidence of liability

is postponed until a formal document is drawn up and signed.

He concluded that there was an inconclusive negotiation between the parties which did not crystallize into a contract in the absence of ad idem.

Learned counsel for the Respondent on the other hand submitted on issue No. 3, that the position of the law is that the Court can presume a contract through various ways including the conduct of parties and the content of correspondence relating to the subject matter of the contract.
He referred on this to the cases of P.T.F. VS. W.P.C. LTD. (2007) 12 NWLR (pt. 1055) 478 at 495; UDEAGU VS. BENUE CEMENT CO. PLC. (2006) 2 NWLR (pt. 955) 600 at 628; COOP. DEV. BANK PLC. VS. EKANEM (2009) 16 NWLR (pt. 1168) 585 at 601.

He submitted that the existence of the contract between the parties can be seen in the correspondence that was exchanged by the parties in respect of the subject matter of their negotiations.

He submitted that after the Respondent wrote the letter dated 12th March, 2002 which is Exhibit 2, in reply to the Appellant’s letter of 7th March, 2002 which is Exhibit 7, the Appellant wrote the letter of 16th April, 2002 to

the Respondent stating its firm decision to lease the property. Counsel submitted that the letter of 16th April, 2002 is Exhibit 3. He referred us to paragraph 1 of the said Exhibit 3 where the Appellant stated:
“Following the series of negotiations and physical inspection of the above property for the purpose of its use for banking activities, we hereby write to inform you of our decision to go ahead with the lease.”

He submitted that the only duty the Respondent had after receiving Exhibit 3 was to proceed to complete the building as required by the Appellant. He referred to the cases of GWANI VS. EBULE (1990) 5 NWLR (pt. 149) 201 at 204 and COOP. DEV. BANK PLC. VS. EKANEM (2009) 16 NWLR (pt. 1168) 585 to say that where there is no reply to a commercial or business correspondence, the presumption is that of acceptance of the proposal or terms in such letter. He urged us to resolve the issue in favour of the Respondent.

There is no doubt that issue No. 3 or indeed the terms of contract between the parties in this case are to be deduced from the correspondence between the parties.

The Respondent claims that Exhibit 3 constitutes

a final acceptance of the agreed negotiations between the parties by the Appellant and that all that was needed after the receipt of Exhibit 3 was for the Respondent to deliver the project as agreed.

The Appellant insists that the same Exhibit 3 contains conditions which could not have made it an acceptance or a conclusion to their negotiations. Exhibit 3 is the letter of 16th April, 2002 from the Appellant to the Respondent. The said Exhibit 3 is hereby reproduced as contained on page 42 of the records:
First Atlantic Bank Plc,
4, Adetokunbo Adewola Street,
P. O. Box 75369,
Victoria Island,
Lagos.
April 16, 2002
Messers John Andy & Company Limited,
28, Aka Road, Uyo
Akwa Ibom State.
Attention: Mr. E. J. Andy
Dear Sir,
EXPRESSION OF INTENT TO LEASE PROPERTY AT NO. 139 AKA ROAD, UYO
Following the series of negotiations and physical inspection of the above property for the purpose of its use for banking activities, we hereby write to inform you of our decision to go ahead with the lease.
We are taking a ten year lease in the first instance for the negotiated rent of Ten

Million Naira only (N10,000,000.00). This amount shall however be due for payment by the 8th of July, 2002 as already agreed with you.
However, we expect that construction work should be completed by the end of May to enable us take possession in the first week of June. The formal agreement to this effect is being drafted for your approval.
You would also be required to liaise with us during the development of the property, to ensure strict compliance with our specifications as contained in the attached drawings.
This is therefore an assurance of our intention to take the property and honour our payment obligations as contained therein.
Thank you for your usual co-operation.
Yours faithfully,
for: FIRST ATLANTIC BANK PLC
Signed:
ARC, E. E. BEN-EBOH
PROJECT MANAGER
Signed:
DAYO FAMOROTI
GENERAL MANAGER

I do not think that there is any other doubt on the content of Exhibit 3 as an expression of the Appellant’s intention in agreeing with the proposals of the Respondent on the lease agreement.

I agree, first with the learned counsel for the Respondent that when the correspondence exchanged are read together and a contract emerges, a Court must enforce such an agreement. See NNEJI VS. ZAKHEM CON. (NIG.) LTD. (2006) 12 NWLR (pt. 994) 297 SC; UDEAGU VS. BENUE CEMENT CO. PLC. (2006) 2 NWLR (pt. 965) 600.

In the instant case, the learned trial judge was right to have held that there was a valid contract between the Respondent and the Appellant. Learned counsel for the Appellant restated his argument on issues 1, 2 and 3 in his treatment of issue No. 4.

Expectedly, the Respondent also adopted its arguments on issues 1, 2, and 3 in response to issue No. 4.
I adopt my decisions on the resolution of issues 1, 2 and 3 as my decision on Appellant’s issue No. 4.
Issue No. 4 is resolved against the Appellant.

Having resolved the four (4) issues in this appeal against the Appellant, the appeal lacks merit and it is accordingly dismissed.
N100,000.00 costs is awarded in favour of the Respondent.

JAMES SHEHU ABIRIYI, J.C.A.: I read in advance, in draft the judgment just delivered by brother, Mojeed Adekunle Owoade JCA and I agree that the Court below was right when it held that there was a valid contract between the Respondent and the Appellant. In the circumstances, I too dismiss the appeal.

I abide by all the orders in the judgment including the order as to costs.

MUHAMMED LAWAL SHUAIBU, J.C.A.: I read a draft of the leading judgment of my learned brother Mojeed A. Owoade, JCA and for the reasons given, the decision of the trial Court is hereby affirmed by me.

I too dismiss the appeal and abide by the consequential order including the orders as to costs.

Appearances:

F. Ibiok,Esq. For Appellant(s)

Francis Ekanem, Esq. For Respondent(s)