LawCare Nigeria

Nigeria Legal Information & Law Reports

GLOBAL FORMWORK (NIG.) LTD v. DAHIRU & ORS (2022)

GLOBAL FORMWORK (NIG.) LTD v. DAHIRU & ORS

(2022)LCN/16734(CA)

In The Court Of Appeal

(ABUJA JUDICIAL DIVISION)

On Friday, July 01, 2022

CA/ABJ/CV/700/2020

Before Our Lordships:

Stephen Jonah Adah Justice of the Court of Appeal

Elfrieda Oluwayemisi Williams-Dawodu Justice of the Court of Appeal

Biobele Abraham Georgewill Justice of the Court of Appeal

Between

GLOBAL FORMWORK NIG. LTD APPELANT(S)

And

1. MRS. AISHA DADA DAHIRU 2. HON. MINISTER OF FEDERAL CAPITAL TERRITORY 3. THE MINISTRY OF THE FEDERAL CAPITAL TERRITORY ADMINISTRATION RESPONDENT(S)

 

RATIO

THE POSITION OF LAW WHERE A PARTY TO A CONTRACT IS IN BREACH OF A MATERIAL TERM OF CONTRACT

The law is also clear as crystal that where a party to the contract is in breach of a material term of contract, the breach gives the innocent party a lee-way or an excuse for non-performance of its own side of the bargain such an innocent party is at liberty to treat the contract as extinguished or an end. See Best (Nig.) Ltd v. Blackwood Hodge (Nig.) Ltd & Anor (2011) LPELR – 776 (SC), Yadis (Nig.) Ltd v. G.N.I.C (2007) 14 NWLR (Pt. 1055) 584 at 609.
A breach occurs when –
(a) there is outright non-performance;
(b) there is a partial performance as performing the contract not in accordance with its terms and; and
(c) by wrongful repudiation of the contract.
Let me make it clear here that in our law, if the innocent party can and does elect to rescind the contract de futuro following a breach by the other party, all the primary obligations of the parties under the contract which have not yet been performed are terminated. Thus, the innocent party is released from the primary obligation of the defaulting party to perform unless there is substituted by operation of law a secondary obligation to pay damages from the loss resulting from the failure to perform the primary obligation. However, the parties can through their agreement, place a secondary responsibility in a different mode than the anticipated mode. Such is the case in the instant appeal. In the instant case, the agreement of the parties in paragraph 13 of Exhibit 2 stipulates thus:
“We reserve the right to withdraw the offer and refund any deposit (less administrative charges of 12%) if payment is not made within the period specified under nos one (1) and (2) two above or in case of the rejection of the offer by the offeree.PER ADAH, J.C.A.

THE DOCTRINE OF SANCTITY OF CONTRACT

The agreement of the parties is very clear. In line with the doctrine of sanctity of contract, parties are bound by their agreement. In the case of Arjay Ltd & Ors v. Airline Management Support Ltd (2003) LPELR – 555 (SC), Tobi, JSC, held:
“It is elementary law that where parties have entered into a contract or an agreement, they are bound by the provisions of the contract or agreement. This is because a party cannot ordinarily resile from a contract or agreement just because he later found that the conditions of the contract or agreement are not favourable to him. This is the whole essence of the doctrine of sanctity of contact or agreement. The Court is bound to construe the terms of the contract or agreement and the terms only in the event of an action arising therefrom. See Northern Assurance Co. Ltd v. Wuraola (1969) 1 NMLR 1 (1969) NSCC 22, Aouad v. Kessrawani (956) NSCC 33, Oduye v. Nigeria Airways Limited (1987) 2 NWLR (Pt. 55) 126, Niger Dams Authority v. Chief Lajide (1973) 5 SC 207, Bookshop House v. Stanley Consultants (1986) 3 NWLR (Pt. 26) 87.” PER ADAH, J.C.A.

THE POSITION OF LAW ON THE PRINCIPLE OF TRUST

Cost is also made to follow events. Cost, no doubt is at the discretion of the trial Court which discretion must be exercised both judiciously and judicially having regards to the evidence before the Court. In the case of Mekwunye v. Emirates Airline (2019) LPELR – 46553 (SC), the Supreme Court, per Akaahs, JSC. held as follows:
“In a civil suit, successful party is generally entitled to be compensated by way of cost, the amount of which the Court has discretion to determine regardless of whether it was pleaded and/or proved. The fact that the trial Court used the word “legal” to qualify the cost awarded makes no difference whatsoever. The trial Court has discretion to take account of any or all expenses incurred by the appellant in awarding it so long as the rule permits in the instant case. The Federal High Court (Civil Procedure) Rules 2009 applied in awarding cost. Order 25 Rule 2 (1) & (2) provides:- “2-(1) In fixing the amount of costs the principle to be observed is that the party who is in the right is to be indemnified the expense to which he has been unnecessarily put in the proceedings, as well as compensated for his time and effort in coming to Court. The Judge may take into account all the circumstances of the case. (2) when costs are ordered to be paid, the amount of such costs shall, if practicable, be summarily determined by the Judge at the time of delivering the judgment or making the order.” (This is on all fours with Order 56 Rule 1(3), (4) of The FCT High Court Civil Procedure, Rules, 2018) In the Book, Civil Procedure in Nigeria’ 2nd Edition by Fidelis Nwadialo at pages 879, the Author stated:- “The assessment of costs is a matter in the discretion of the Court of trial but the discretion must be exercised judicially and if not so exercised, the Court of Appeal would be entitled to interfere and set aside an unjustifiable award.” See Chanrai & Co. Ltd v. Khawam (1965) 1 All NLR 188 at 196 and Nwadialor v. Onyia (1971) 1 UILR 524. The author went further to say at page 880:- “The trial Judge should therefore show for what items he allowed costs and how much was allowed in respect of each. The Court of Appeal is thereby placed in a good position to review the costs if they are challenged on appeal. Where a trial Court awards costs that are ex facie excessive but does not state his reason for so doing or gives a wrong reason or one for which no valid reason can be seen, the appellate Court may reduce the costs.” See Wurno v. U.A.C. (1956) 1 FSC 33; Ledega v. Akinbiyi (1975) 2 SC 91.”
PER ADAH, J.C.A.

STEPHEN JONAH ADAH, J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of the High Court of the Federal Capital Territory, Abuja, delivered on 18th June, 2020, in suit No: FCT/HC/CV/2514/2015.

The 1st Respondent as Claimant instituted this action at the trial Court and claimed against the Appellant as 1st Defendant all the sundry reliefs as per the Statement of Claim, thus:
1. A declaration that the stoppage of work and/or failure of the 1st Defendant to continue the erection of the plaintiff’s Type 3A Single Storey detached House with boys quarters at Plot No. 28 M.S. Alhassan Street, within Precinct 1 Malaysian Gardens Saraji District, Abuja since 2917/2008 or thereafter, after receipt of N6,000,000.00 is in breach of the contract of 28/8/2008.
2. An order of specific performance directing the 1st defendant to complete and deliver the Type 3A Single Storey detached house with boys quarters at plot 28 M.S. Alhassan Street, within precinct 1 Malaysian Gardens Saraji District, Abuja within three weeks from the date of the judgment and/or as the Court may direct or an order directing the plaintiff to take possession of the aforesaid Type 3A Single Storey detached Residential House with boys quarters at Plot 28 M.S. Alhassan Street within Precinct 1 Malaysian Gardens Saraji District, Abuja and use the balance of N20,092,500 to effect the completion of the said house and that the 2nd and 3rd defendants shall issue the relevant documents of title thereof to the plaintiff.
3. An order of perpetual injunction restraining the 2nd and 3rd defendants from revoking the Development Lease Agreement entered into with the 1st defendant on 2/7/2004 and it Addendum as they affect the rights and interest of the plaintiff in plot 28 M.S. Alhassan Street, Precinct 1 Malaysian Gardens Saraji District Abuja or another area in Saraji District as the Court may determine in the circumstances of this case.
4. General damages of N10 million against the 1st defendant.
5. And any other order or orders as the Court may deem fit to make in the circumstances.
IN THE ALTERNATIVE
1. A declaration that the stoppage of work and/or failure of the 1st Defendant to continue the erection of the plaintiff’s Type 3A Single Storey detached residential house with boys quarters at plot 28 M.S Alhassan Street, within precinct 1 Malaysian Garden Saraji District, Abuja, since 29/7/2008 after receipt of N6,000,000.00 is a breach of the contract of 2818/2008
2. Refund of the sum of N6,000,000 by the 1st Defendant to the plaintiff being part payment paid by the plaintiff to the 1st defendant for erection of Type 3A Residential house at plot 28 M.S Alhassan Street, Precinct 1 Malaysian Garden Saraji District, Abuja, which the 1st defendant has failed, refused and neglected so to do.
3. Payment by the 1st defendant to the plaintiff of Bank interest of 21% on the said N6,000,000.00 from 29/7/2008 till judgment and 10% after judgment until final liquidation.
4. An order that where the 1st defendant fails, refuses or neglects to refund the said N6 million to the plaintiff within 3 months from the date of judgment, the plaintiff shall take physical possession of the aforesaid Type 3A Single Storey detached residential house with boys quarters at plot 28 M.S. Alhassan Street, within Precinct 1 in Malaysian Gardens, Saraji District, Abuja, and the 2nd and 3rd defendants shall issue the relevant documents of title thereof to the plaintiff within 6 months from the date of judgment or as the Court may direct.
5. Or an order that the 1st 2nd and 3rd defendants allocate to the plaintiff a piece of land along the road at Malaysian Gardens, Saraji District, Abuja measuring at least 1,600 sq.m or as the Court may determine of the value of N6, 000,000.00 or any other place in Saraji District, Abuja as the Court may determine in the circumstances of this case and issue the relevant documents of title thereto.
6. General damages of N20 million against the 1st defendant for breach of contract.
7. Any other order or orders as the Court may deem fit to make in the circumstances.

In proof of her case, the 1st Respondent testified on her behalf, and also tendered several exhibits, altogether 12 documents, which were admitted in evidence and marked as Exhibits 1 – 5.

The 1st Defendant now Appellant, filed a statement of defense and counter-claim, denied the claim of the 1st Respondent vide a statement of defense on the 16th March, 2016. The 2nd and 3rd Defendant did not file any process neither did they take part in the proceedings in respect of this suit at the lower Court, but were duly served with all the Court processes. At the close of trial, the trial Court, on the 18th of June, 2020, entered judgment in favour of the 1st Respondent, granting part of the alternative reliefs.

Aggrieved by this decision, the appellant filed this instant appeal vide the notice of appeal filed on the 10th day of July, 2020. There are two grounds of appeal listed in the Notice of Appeal. The Record of Appeal was transmitted to this Court on the 25th day of August, 2020.

In line with the rules and practice of this Court, parties filed and exchanged their respective Briefs of Argument. Appellant’s brief was dated 7th October, 2020, but filed on 8th October, 2020. 1st Respondent’s Brief of Argument was dated 10th November, 2020 and filed 11th November, 2020. The 2nd and 3rd Respondent Brief of Argument was dated 15th June, 2021 and filed 16th June, 2021, but deemed properly filed and served on 17th January, 2022.

Learned counsel for the Appellant distilled a lone issue for the determination of this appeal. This issue is:
Whether the trial Court was right in view of the express parties’ agreement Exhibit 2 to have ordered for the refund of the sum N6,000,000.00 of so far paid by the 1st Respondent and also to have awarded a cost of N300,000 against the Appellant in the circumstances of the case?

In response, learned counsel for the 1st Respondent as well as counsel for the 2nd and 3rd Respondent adopted the lone issue formulated by counsel for the Appellant. The lone issue is consequently adopted for the determination of this appeal.

Sole Issue:
This issue is – Whether the trial Court was right in view of the express parties’ agreement Exhibit 2 to have ordered for the refund of the sum of N6,000,000.00 so far paid by the 1st Respondent and also to have awarded a cost of N300,000 against the Appellant in the circumstances of the case?

Learned counsel for the appellant while arguing this issue relied on the case of Uwa v. Akpabio (2014) All FWLR (Pt. 738) 886, Idufueko v. Pfizer Products Ltd (2014) All FWLR (Pt. 745) 269, Williams v. Williams (2015) All FWLR (Pt. 782) Pg. 1596, BFI Group Corporation v. Bureau of Public Enterprises (2012) 18 NWLR (Pt. 1332) Pg. 209 at 247 Paras. E-F, Mustapha v. Abubakar (2012) All FWLR (Pt. 651) Pg. 1520, argued that the parties and the Court are bound by the terms of the contracting parties. The parties or the Court are not allowed to add or subtract from the terms of the contract reached by way of consensus ad idem. To do so will defeat the reasond’ etre for the hallowed doctrine of sanctity of contract. He cited Okwejiminor v. Gbakeji (2008) 5 NWLR (Pt. 1079) Pg. 172 @ 196 Paras. C-G, Dina v. New Nigerian Newspapers Ltd (1986) 2 NWLR (Pt. 22) Pg. 353; Aguocha v. Aguocha (1986) 4 NWLR (Pt. 37) Pg. 366, and submitted that evidence obtained during cross-examination but on facts not pleaded is inadmissible.

Learned counsel for the appellant submitted that in construing the written agreement between parties, the document must be read as a whole and parties or the Court will not be permitted to pick and choose portions of the documents on which they will place reliance to the neglect of other parts of the same document. Counsel relied on the cases of International Standard Securities v. Union Bank Nig. Plc (2009) LPELR-8788 (CA) Pg. 32 Paras. D-E; Williams v Williams (2014) LPELR-22642 (CA) Pg. 31 Paras. C-G;  Epe Resorts & Spa Ltd v. UBA Plc (2018) LPELR-45310 (CA), Baba v. Nigerian Civil Aviation Training Centre (1991) 5 NWLR (Pt. 192) 388, Onyenuga v. Provisional Council of University of Ife (1965) NMLR 9; Koiki v. Magnusson (1999) 8 NWLR (Pt. 615) 492; Union Bank of Nigeria Limited v. Sax Nigeria Limited (1994) 8 NWLR (Pt. 361) 124 at 165; Adiele lhunwo v. Johnson lhunwo (2013) LPELR-20084 (SC) Pg. 41-42 Paras. E-B; Archibong v. First Bank of Nigeria Plc (2014) LPELR-22649 (CA) Pg. 29-31 Paras. D-A; UBA v. New Tarzan Motors Ltd. (2016) LPELR-41016 (CA) Pg. 23-25. Paras. G-C. Counsel urged this Court to allow the appeal, set aside the decision of the trial Court.

Counsel for the 1st Respondent while arguing this issue, stated the trite position of the law that an admitted fact by a contending party needs no further proof. Where a material fact as in the instant case is admitted by the other party, the Court would act on it in favor of the party on whose behalf the admitted evidence is given. Counsel relied on Bankole v. Adeyeye (2014) All FWLR (Pt. 721) P. 1583, paras E-F, Odofin v. Oni (2001) FWLR (Pt. 36) 807, Akaninwo v. Nsirim (2008) All FWLR (Pt. 410) 610, Bello v. Gombe State (2016) 8 NWLR (Pt. 1514) 219 at 270, paras. E-G, Akomolafe v. Guardian Press Ltd (2010) 3 NWLR (Pt. 1181) 338 at 351, paras. F-H; 354, paras. H-B; Gaji v. Paye (2003) 8 NWLR (Pt. 823) 583; Andrew v. INEC (2018) 9 NWLR (Pt. 1625) 399 at 584, paras. D-F, Impact Solutions Ltd v. International Breweries Plc (2018) 16 NWLR (Pt. 1645) 199 at 402, Paras. A-C; Oforlete v. State (2000) 12 NWLR (Pt. 681) 415; Omisore v. Aregbesola (2015) 15 NWLR (1482) 205; Okuleye v. Adesanya (2014) 12 NWLR (Pt. 1422) 321; Adeosun v. Governor of Ekiti State (2012) All FWLR (Pt. 619) 1010 at 1059, paras. B-C Shell Petroleum Development Company of Nigeria Ltd v. Abba (2005) All FWLR (Pt. 257) 1401 at 1548, Para. A.

Counsel for the 1st Respondent submitted that this Court should hold that a breach of fundamental terms of contract which entitle the 1st Respondent to treat the contract as repudiated and further seek for a refund of money paid and/or with damages has occurred in this appeal. Counsel relied on Dakour v. Lagos State Urban Renewal Board (2015) All FWLR (Pt. 809) 917 at 947 Para. G, Sung Hydraulic Machinery Co. Ltd v. Jaffar (2005) All FWLR (Pt. 250) 1 at 50 Para. C, lgwem & co. Ltd v. lgwebe (2010) All FWLR (Pt. 540) 1209 at 1313, Paras. C-D, Haido v. Usman (2004) All FWLR (Pt. 201) 1765, Nwaolisah v. Nwabujoh (2011) 1601, 343 at 414, Paras. C-D, Paras. C-E, Anaeze v. Anyaso (1993) 5 NWLR (Pt. 2910) 1.

Counsel further submitted that where findings of a trial Court are borne out of the credible evidence before the trial Court, same cannot be said to be perverse and the appellate Courts shall not tamper/interfere with such findings of the trial Court which had the singular advantage of seeing and hearing witnesses testify. He relied on Olowu v. Building Stock Ltd (2018) 1 NWLR (Pt. 1601)343 at 437 Paras. C-D, Kazeem v. Mosaku (2007) 17 NWLR (1064) 523, Registered Trustees of Deeper Christian Life Ministry v. Mr. Joseph Ebhodagie (2017) All FWLR (877) 208 at 401, Paras. A-D, Atanda v. Ajani (1989) 3 NWLR (Pt. 111) 511, lgwem & co. Ltd v. lgwebe (2010) All FWLR (540) 1209 at 1309, Para. A, Ojo v. Phillip (1993) 5 NWLR (Pt. 296) 751, Hyun Sung Hydraulic Machinery Co. Ltd v. Jaffar (2005) All FWLR (Pt. 250) 1 at 53, Para. G, Salami v. Ajadi (2012) All FWLR (Pt. 615) 200 at 302, Para. E, Amadi v. Nwosu (1992) 6 SCNJ 59, Hill Station Hotel Limited v. Adeyi (1996) 3-4 MAC 125, Garba v. Zariah (2005) All FWLR (Pt. 283) at 36, Osundo Co. Ltd v. Dr. Joseph Akhigbe (1999) 7 SCNJ 1, Emegokwe v. Okadigbo (1973) 4 SC 113; SPDC (Nig.) Ltd v. Ambah (1999) 3 NWLR (Pt. 593) 1.

Learned counsel for the 1st Respondent submitted that a successful party should not be deprived of costs and there can be no appeal in respect of a discretion on particular facts even from the erroneous exercise of discretion. This is because it is based on the private opinion of the judge. Counsel relied on Registered Trustees of Deeper Christian Life Ministry v. Mr. Joseph Ebhodagbe (2017) All FWLR (877) 208 at 401, Paras. A-D, at 403, Paras. E-G, Obayagbona v. Obazee (1972) 5 SC 159, Elf Pet. (Nig.) Ltd v. Umah (2018) 10 NWLR (Pt. 1628) 447, Paras. F-H, Udeagu v. Benue Cement Company Plc (2005) All FWLR (Pt. 276) 610 at 733, Paras. E-F. Counsel urged the Court to dismiss the appeal with cost as same is unmeritorious and not deserving of the scarce judicial time.

Learned counsel for the 2nd and 3rd Respondents, while arguing the lone issue submitted that when the 1st Respondent noticed that the appellant was not forthcoming in the building and delivering possession of the house, she demanded a refund of the sum of 6 Million Naira which she paid as deposit to the appellant but that effort proved abortive. These averments were not challenged/controverted at the trial Court and the law is trite with nothing to the contrary that where pieces of evidence are neither challenged nor contradicted in the course of cross-examination, the evidence ought to be deemed as having been admitted by the adverse party who ought to challenge or contradict the evidence. Counsel relied on Amadi v. Nwosu (1992) 6 SCNJ 590. 

Counsel further stated that it is not in dispute that a valid contract exists between the Appellant and 1st Respondent, however the Appellant has by its conduct breach the terms of the contract by abandoning the building of the said house for a period of 7 years and not keeping the 6 Million Naira deposit paid to it by the 1st Respondent, thus the learned trial judge was right in ordering for a refund of 6 Million Naira only paid to the Appellant by the 1st Respondent. Counsel relied on lgwem & Co. Ltd v. lgwebe (2010) All FWLR (Pt. 540) 1209 AT 1313, Paras. C-D. Counsel urged this Court to dismiss this appeal as it relates to the 2nd & 3rd Respondent.

In the instant case, the parties are certain of the agreement entered between the appellant and the 1st Respondent. This case is directly a case of a party complaining of breach of contract.

The contract between the appellant and the 1st Respondent was exhibited as Exhibit 2 before the trial Court. The law is very clear and straight forward that parties to a contract are bound by the agreements they entered. In a contract, there are terms which project the rights and duties of each of the parties in the contract.

The learned trial judge captured the crux of the agreement of the parties at pages 228 to 229 of the Record of Appeal, when he found in his judgment as follows:
“With due respect to learned counsel, there is no provision in Exhibit 2 requiring the defendant to build on milestones and receive payment from the claimant based on the progress of work at site. The submission is outside the terms of the document and is an attempt to read into the contract what is not there. The respective duties of the parties as recorded in Exhibit 2 is straightforward, namely: (i) the claimant will make full payment for the house within nine (9) months of accepting the offer; and (ii) the defendant will deliver the house to the claimant within a period of 11 months after confirming full payment by the claimant. Exhibit 2 does not say when the defendant is to commence building the house, it only states when it should be delivered to the purchaser and that is “within eleven months after confirmation of full payment”. Parties are bound by their contract and none will be allowed to import strange interpretations just to suit his selfish intentions. See Aharanwa v. Peoples Bank of (Nig.) Ltd & Anor (2018) 43985 (CA). On the express wording of Exhibit 2, payment of the full purchase price was a condition precedent for the delivery of the house to the claimant. There is no duty on the defendant to deliver a house to the claimant until full payment has been made for it. Her payment of N6m out of a total purchase of N26,092,500.00 did not satisfy the terms stipulated in Exhibit 2 for acquiring a house in the 1st defendant’s estate.”

This finding of the trial Court is apt and unassailable having regards to the evidence before the trial Court. From the evidence and the findings of the learned trial Court, there is no doubt as to which of the parties breached the fundamental terms of their contract. The 1st Respondent had a duty to pay fully for the house to be constructed. Even after paying fully, the appellant had eleven (11) months within which to deliver the house.

The parties had in paragraph 13 of Exhibit 2 agreed on contract on what happens where there is a failure to make the scheduled payments stipulated in paragraphs 1 and 2 of the agreement.

For a clear understanding of the parties’ agreement, I would like to recap paragraphs 1, 2 and 13 of Exhibit 2 as follows:
1. Payment: Payment must be made by cash or Bank draft into Global Formwork (Nig.) Limited Account Number 7200128657 at Stanbic IBTC branches nationwide. The full costs of a unit and 5% VAT will amount to a total sum of N26,092,500.00 (twenty-six million, and ninety-two thousand, five hundred naira).
2. Payment options: N2,400,000 (two million, four hundred thousand naira) payment to be made on acceptance of offer letter, N15,000,000 (fifteen million naira) to be paid within six (6) months of acceptance and the remaining balance of N8,692,500 (eight million, six hundred and ninety-two thousand, five hundred naira) to be paid within three (3) months from the date of last payment…..
13. Termination of Offer: However, we reserve the right to withdraw the Offer and refund any deposit (less administrative charges of 12%) if payment is not made within the period specified under nos one (1) and (2) two above or in case of the rejection of the offer by the offeree.
This agreement shall not be binding unless it is accepted and returned to Global Formwork within seven (7) days from the date of the offer.
Without prejudice to the clauses herein contained, Global Formwork, reserves the right to vary, alter or amend any of the terms and conditions, as and when the need arises.
Note: Unit prices as per offer remain valid till the end of construction, provided that the conditions stipulated in nos one (1) and two (2) above are complied with. (see pages 74 to 776 of the Record of Appeal).
Brackets supplied by me.

It is expressly clear by paragraph 13 of the agreement that the appellant had the right to withdraw the offer and refund any deposit (less administrative charges of 12%) if payment is not made within the specified period as clearly shown in paragraphs 1 and 2 of the agreement. The 1st Respondent made payment from the evidence before the Court of the sum of N2,400,000 as a deposit on 14/5/2009. Then on 1/9/2009, she further paid a sum of N1,600,00 and a further sum of N2,000,000 on 3/9/2009, bringing the total deposit as at 3/9/2009 to be N6,000,000.

The 1st Respondent from the facts before us, paid the acceptance deposit on 14th day of May, 2009. She did not pay the required N15,000,000 within Six months. Thereafter, she also did not pay the balance of N8,692,500, as per their agreement. It follows therefore, that the breach of the contract of the appellant and the 1st Respondent occurred at the instance of the 1st Respondent who did not pay the money as was prescribed in the scale of payment and has not paid the required sum uptill now.

The law is also clear as crystal that where a party to the contract is in breach of a material term of contract, the breach gives the innocent party a lee-way or an excuse for non-performance of its own side of the bargain such an innocent party is at liberty to treat the contract as extinguished or an end. See Best (Nig.) Ltd v. Blackwood Hodge (Nig.) Ltd & Anor (2011) LPELR – 776 (SC), Yadis (Nig.) Ltd v. G.N.I.C (2007) 14 NWLR (Pt. 1055) 584 at 609.
A breach occurs when –
(a) there is outright non-performance;
(b) there is a partial performance as performing the contract not in accordance with its terms and; and
(c) by wrongful repudiation of the contract.
Let me make it clear here that in our law, if the innocent party can and does elect to rescind the contract de futuro following a breach by the other party, all the primary obligations of the parties under the contract which have not yet been performed are terminated. Thus, the innocent party is released from the primary obligation of the defaulting party to perform unless there is substituted by operation of law a secondary obligation to pay damages from the loss resulting from the failure to perform the primary obligation. However, the parties can through their agreement, place a secondary responsibility in a different mode than the anticipated mode. Such is the case in the instant appeal. In the instant case, the agreement of the parties in paragraph 13 of Exhibit 2 stipulates thus:
“We reserve the right to withdraw the offer and refund any deposit (less administrative charges of 12%) if payment is not made within the period specified under nos one (1) and (2) two above or in case of the rejection of the offer by the offeree.”

The agreement of the parties is very clear. In line with the doctrine of sanctity of contract, parties are bound by their agreement. In the case of Arjay Ltd & Ors v. Airline Management Support Ltd (2003) LPELR – 555 (SC), Tobi, JSC, held:
“It is elementary law that where parties have entered into a contract or an agreement, they are bound by the provisions of the contract or agreement. This is because a party cannot ordinarily resile from a contract or agreement just because he later found that the conditions of the contract or agreement are not favourable to him. This is the whole essence of the doctrine of sanctity of contact or agreement. The Court is bound to construe the terms of the contract or agreement and the terms only in the event of an action arising therefrom. See Northern Assurance Co. Ltd v. Wuraola (1969) 1 NMLR 1 (1969) NSCC 22, Aouad v. Kessrawani (956) NSCC 33, Oduye v. Nigeria Airways Limited (1987) 2 NWLR (Pt. 55) 126, Niger Dams Authority v. Chief Lajide (1973) 5 SC 207, Bookshop House v. Stanley Consultants (1986) 3 NWLR (Pt. 26) 87.”

The doctrine of sanctity of contract must be observed by the Court. The parties by their agreement made it explicit that a breach as had occurred in this case will terminate the contract and any deposit paid will be refunded (less administrative charges of 12%).

The entitlement of 1st Respondent in the circumstances of her inability to fulfill the primary terms of the contract is a refund of N6m less 12% administrative charges. The trial Court with due respect went outside the agreement of the parties to order that the alternative relief (b) for refund of N6m is granted with ten percent (10%) post-judgment interest. The said relief as earlier reproduced in this judgment presupposed that the appellant was at fault. That also might have motivated the trial Court to award a cost of N300,000 against the appellant. The reason for the order was wrong. Cost is also made to follow events. Cost, no doubt is at the discretion of the trial Court which discretion must be exercised both judiciously and judicially having regards to the evidence before the Court. In the case of Mekwunye v. Emirates Airline (2019) LPELR – 46553 (SC), the Supreme Court, per Akaahs, JSC. held as follows:
“In a civil suit, successful party is generally entitled to be compensated by way of cost, the amount of which the Court has discretion to determine regardless of whether it was pleaded and/or proved. The fact that the trial Court used the word “legal” to qualify the cost awarded makes no difference whatsoever. The trial Court has discretion to take account of any or all expenses incurred by the appellant in awarding it so long as the rule permits in the instant case. The Federal High Court (Civil Procedure) Rules 2009 applied in awarding cost. Order 25 Rule 2 (1) & (2) provides:- “2-(1) In fixing the amount of costs the principle to be observed is that the party who is in the right is to be indemnified the expense to which he has been unnecessarily put in the proceedings, as well as compensated for his time and effort in coming to Court. The Judge may take into account all the circumstances of the case. (2) when costs are ordered to be paid, the amount of such costs shall, if practicable, be summarily determined by the Judge at the time of delivering the judgment or making the order.” (This is on all fours with Order 56 Rule 1(3), (4) of The FCT High Court Civil Procedure, Rules, 2018) In the Book, Civil Procedure in Nigeria’ 2nd Edition by Fidelis Nwadialo at pages 879, the Author stated:- “The assessment of costs is a matter in the discretion of the Court of trial but the discretion must be exercised judicially and if not so exercised, the Court of Appeal would be entitled to interfere and set aside an unjustifiable award.” See Chanrai & Co. Ltd v. Khawam (1965) 1 All NLR 188 at 196 and Nwadialor v. Onyia (1971) 1 UILR 524. The author went further to say at page 880:- “The trial Judge should therefore show for what items he allowed costs and how much was allowed in respect of each. The Court of Appeal is thereby placed in a good position to review the costs if they are challenged on appeal. Where a trial Court awards costs that are ex facie excessive but does not state his reason for so doing or gives a wrong reason or one for which no valid reason can be seen, the appellate Court may reduce the costs.” See Wurno v. U.A.C. (1956) 1 FSC 33; Ledega v. Akinbiyi (1975) 2 SC 91.”

Cost awarded in the instant case sequel to the case instituted by the 1st Respondent was meant to indemnify the 1st Respondent’s expenses in the case. The cost for the 1st Respondent was not defensible. He indeed was the defaulter and he cannot benefit from his own default. That cost is therefore, set aside.

From the foregoing, I am of the clear view that this appeal has merit and it succeeds. The appeal is therefore, allowed. The order of the trial Court granting the Alternative Relief (b) and cost is hereby set aside. In place of that order, the appropriate order to give is that the sum of N6,000,000 deposit paid by the 1st Respondent shall be refunded to the 1st Respondent, less 12% of the sum of N6,000,000.
No cost is awarded.

ELFRIEDA OLUWAYEMISI WILLIAMS-DAWODU, J.C.A.: I have had the advantage of reading the lead judgment of my learned brother, Stephen Jonah Adah, JCA, just delivered and I am in complete agreement with the reasoning and conclusion contained therein.

I join my learned brother in allowing the appeal and abide by the orders made therein.
I make no order as to costs.

BIOBELE ABRAHAM GEORGEWILL, J.C.A.: I have been privileged to read in advance a draft copy of the leading judgment just delivered by my noble Lord Stephen Jonah Adah JCA, and I am completely satisfied with the lucid reasoning and impeccable conclusions reached therein to the effect that the appeal has merit and ought to be allowed.

My Lords, in law until an agreement moves from the formation stage of offer and progresses into the stage of acceptance and total consideration moves from the offeree to the offeror there can be no binding contract. In such a circumstance, both parties would be at liberty to reconsider their position and the offer can either be withdrawn or the acceptance with incomplete consideration be rescinded. However, in both situations the party in default cannot turn round to attempt and be allowed to benefit from his own wrong. Let me explain!

The 1st Respondent had entered into an inchoate agreement, in the sense of being a conditional contract, with the Appellant as in Exhibit 2 for the putting up of a building for her at an agreed total cost of N26, 092, 500. 00, out of which sum the sum of N15, 000, 00. 00 shall be paid within six months. However, the 1st Respondent only the sum of N6, 000, 000. 00 rather the sum of N15, 000, 000. 00 within six months contrary to the terms of the agreement. Yet, it was the 1st Respondent, being in default of the inchoate agreement in Exhibit 2, that had approached the lower Court to enforce the terms of the inchoate agreement and seeking amongst several reliefs the claim for specific performance or in the alternative the refund to her of the N6,000,000. 00 deposit paid so far out of the initial N15,000, 000. 00 to be paid within six months. The lower Court appeared to have been satisfied with the evidence brought forward by the 1st Respondent as Claimant and had entered judgment in her behalf in terms of her alternative relief B for the refund, whole, of the N6,000,000. 00 she paid but had refused, failed and to neglected to pay the balance to round it up to N15,000,000. 00 within the six months as agreed by the parties.

In the leading judgment, the entire pleadings, evidence and circumstances of this case have been admirably considered and the impeccable conclusion arrived thereat, and with which I am in total agreement, was that It was the 1st Respondent who was in breach of the inchoate agreement between the parties as in Exhibit 2 for her failure to pay the N15,000, 000. 00 within six months as agreed between the parties. In such circumstances therefore, the 1st Respondent, who is herself in default, cannot be allowed to benefit from her wrong by being entitled to, as was erroneously ordered by the lower Court, to the complete refund of the N6, 000, 000. 00 she had managed to pay out of the N 15, 000, 000. 00 as was agreed to be paid within six months.

Regrettably, in arriving at the above erroneous conclusion the lower Court failed to avert its mind to the terms of the conditional contract as entered into between the parties in Exhibit 2, wherein it was agreed that in the event of a breach or failure by the 1st Respondent to fulfil the conditions for the full operation of the contract any refund to be made shall be less 12% of the total sum paid so far. Thus, all that the 1st Respondent was entitled to in law, contrary to the perverse finding of the lower Court, was N6, 000, 000. 00 less 12%, (N720, 000. 00), which by simple arithmetic will amount to N5, 280, 000.00, and nothing more. To award both cost and 10% interest on the judgment sum in favour of the 1st Respondent was not only most gratuitous but very wrong in every way it is looked at being that it was the 1st Respondent whose failure to comply with the payment of the sum of N15000,000.000 within the six months as agreed by the parties that resulted into the breach and eventual frustration of the inchoate contract as in Exhibit 2 between the parties.

How, could the 1st Respondent, who was in breach and or default of the conditions or the terms in Exhibit 2, then turn around not only to claim total refund of her N6,000,000. 000 contrary to the very clear terms of Exhibit 2, but also strangely claimed or be entitled to interest and or cost against the parties who was not in breach of the contract? This is simply preposterous but yet the lower Court found nothing wrong with it and had even proceeded to grant her such an unworthy relief. In law, whilst parties are at liberty to incorporate into a written agreement conditions precedent but once that is done, those conditions precedent must first be met and or fulfilled before a binding contract can be said to be in existence or created between them. The decided authorities on this settled position of the law are legion! Suffice to mention a few of them. See Cornet & Cubbit Ltd & Anor V. Federal Housing Authority & Ors (2022) LPELR-57507 (CA) per Sir Biobele Abraham Georgewill JCA. See also Tsokwa Oil and Marketing Co. V. BON (2002) 11 NWLR (Pt 777) 163, Nigerian Bank for Commerce and Industry V. Integrated Gas (Nig) Ltd (1999) 8 NWLR (Pt 613) 127, Suberu V. A.I.S & L Ltd (2007) ALL FWLR (Pt. 380) 1512 AT pp. 1528 – 1529; Bilante International Ltd V. NDIC (2011) 6 SCNJ 481 at p. 498; Niger Care Development Company Ltd V. Adamawa State Water Board & Ors (2008) LPELR – 1997(SC) 25.

Thus, it is only when there is a binding contract that the parties become bound by the terms as voluntarily entered into by them. Thus, men, women and institutions and or organizations of honour and integrity do feel bound, without any further assurances, to the terms of their contract, as it is the honorable thing for them to do. See Salbodi Group Ltd & Anor V. Doyin Investment (Nig) Ltd & Ors (2022) LPELR – 57458 (CA) per Sir Biobele Abraham Georgewill JCA. See also Cornet & Cubbit Ltd & Anor V. FHA & Ors (2022) LPELR-57507(CA) per Sir Biobele Abraham Georgewill JCA, Stanbic IBTC Bank V. Longterm Global Capital Ltd & Ors (2018) LPELR – 44053(CA) per Sir Biobele Abraham Georgewill JCA, Neka BBB Manufacturing co. Ltd V. ACB Ltd (2004) 2 NWLR (PT. 858) 521, BFI Group Corporation V. Bureau of Public Enterprises (2012) LPELR-9339 (SC), Bilante Inter’l Ltd V. NDIC (2011) 15 NWLR (Pt. 1270) 407 at p. 436.

My Lords, the language of withdrawal of offer can only be tenable before the offeree furnishes full consideration. Thus, if acceptance had been backed up with full consideration from the offeree to the offeror, which was not the case in the instant appeal in which even after six months the 1st Respondent was yet to complete the initial payment of N 15,000,000.00 out of the total amount of N26,092,500.00 due to be paid to the Appellant, the concept of withdrawal of offer would have become unacceptable, and indeed strange to the principles of the law of contract. The language ordinarily known to the principles of contract once a binding contract has been formed is breach of contract and or specific performance. It is either one of the parties is suing for breach of contract if the other party reneges on the terms of the contract or one of the parties is seeking to specifically enforce the contract, as the 1st Respondent had unsuccessfully sought to do before the lower Court.

My Lords, I think I have said enough and a word, it is said at common parlance is enough for the wise. Let the 1st Respondent give heed to the wise and prudent reasoning in the leading judgment and in this humble contribution and go and sin no more! She must learn to abide by the terms of contracts she voluntarily enters! I shall say no more!

It’s for the above few thoughts of mine but for the fuller reasons adroitly marshaled out in the leading judgment that I too hold that the appeal is pregnant with merit and perforce ought to succeed. I too hereby allow the appeal. I shall abide by the consequential orders made in the leading judgment.

Appearances:

Victor Agunzi, Esq. For Appellant(s)

M.E. Oru, SAN, with him Francis Eyo, Esq., and N. Adanu, Esq., for the 1st Respondent.

Anthony Ogbulafor, Esq., for the 2nd and 3rd Respondents. For Respondent(s)