GLOBAL FORMWORK (NIG) LTD v. MUSA & ORS
(2022)LCN/16735(CA)
In The Court Of Appeal
(ABUJA JUDICIAL DIVISION)
On Wednesday, May 18, 2022
CA/A/508/2016
Before Our Lordships:
Stephen Jonah Adah Justice of the Court of Appeal
Elfrieda Oluwayemisi Williams-Dawodu Justice of the Court of Appeal
Danlami Zama Senchi Justice of the Court of Appeal
Between
GLOBAL FORMWORK NIGERIA LTD APPELANT(S)
And
1. MRS. AISHA AHMED MUSA 2. HON. MINISTER OF THE FEDERAL CAPITAL TERRITORY 3. THE MINISTRY OF THE FEDERAL CAPITAL TERRITORY ADMINISTRATION RESPONDENT(S)
RATIO
THE POSITION OF LAW WHERE AN AGREEMENT CONTAINS AN ARBITRATION CLAUSE
The law is that where an agreement contains arbitration clause, that parties should first refer any issue arising between them to arbitration, no party will be allowed or permitted to breach such. In the instant, the question that needs be answered is whether the parties contracted to first resort to arbitration before taking any legal or other step.
Further, it is trite that parties to an agreement are at liberty to determine the terms that bind them and the Court is not allowed to read terms which were not agreed to by the parties into their agreement. See the cases of AGBAREH & ANOR V. MIMRA & 2 ORS 2008 2 MJSC 134 and KAYDEE VENTURES LTD V. HON. MINISTER FCT & 7 ORS. 2010 7 NWLR PT. 1192 171. PER WILLIAMS-DAWODU, J.C.A.
WHETHER OR NOT PARTIES ARE BOUND BY THE TERMS OF THEIR CONTRACT
The law is settled that parties are bound by their terms of contract. The Court cannot re-write for the parties their terms of contract. See Oforishe v. Nigerian Gas Co. Ltd. (2018) 2 NWLR (Pt. 1602) 35, Nika Fishing Co. Ltd. v. Lavina Corporation (2008) LPELR – 2035 (SC), JFS Investment Ltd. v. Line Ltd & Ors., (2010) LPELR – 1610 (SC). PER ADAH, J.C.A.
ELFRIEDA OLUWAYEMISI WILLIAMS-DAWODU, J.C.A.(Delivering the Leading Judgment): This appeal emanated from the ruling of the High Court of the Federal Capital Territory, Kubwa, delivered by Hon. Justice Bello Kawu on June 23rd 2016, in Suit No. FCT/HC/CV/2522/15 by the 1st Respondent (the Plaintiff and Respondent to the Appellant’s application at the Court below) wherein the Court refused to stay further proceedings as prayed by the Appellant (the 1st Defendant at the Court below).
The brief facts as garnered from the Record before this Court is that the Appellant, a private developing Company advertised houses for sale at the Percent 1, Malaysian Gardens, Saraji District Abuja being part of a large Housing scheme under a Deed Agreement between the 2nd and 3rd Respondents and the Appellant. The 2nd and 3rd Respondents are the official authority to provide infrastructures for the scheme and give necessary approvals for the progress of the scheme. The 1st Respondent being interested paid for one of the houses being advertised by the Appellant but eventually changed from the Type 2A House to Type 3A single storey detached house with boys quarters. In consequence, she moved from the agreement of 29/3/2010 to another agreement on 24/8/2011 in respect of the single storey detached house, had to pay more and eventually in total paid the sum of N43, 340, 000.
It is further the story of the 1st Respondent that the Appellant did not deliver the house neither did it return her money. She therefore proceeded to the Court after several efforts to have her money back. Whilst the matter had commenced, the Appellant vide a Motion on Notice sought stay of the proceedings and sought the following reliefs:
1. “An order of the Honourable Court staying further proceedings in this suit for parties to resort to Arbitration in accordance with the agreement of the parties to resolve all disputes arising therefrom by reference to Arbitration.
2. An order directing that the dispute be first resolved by reference to Arbitration in accordance with the parties agreement.
3. And for such further Orders the Court may deem fit to make in the circumstances.
The Court refused the application. Being dissatisfied with the ruling, the Applicant approached this Court.
The Appellant’s Notice and Two (2) Grounds of Appeal dated and filed July 11th, 2016 are contained on pages 167 to 170 of the printed Record before this Court.”
The following relief is being sought:
“To allow the appeal, set aside the decision of the lower Court made on 23rd June, 2016 and to stay proceedings in Suit No. FCT/HC/CV/2522/15 pending before his Lordship Hon. Justice B. Kawu of the FCT High Court Abuja pending resort by parties to arbitration in accordance with the parties’ agreement.”
In compliance with the 2021 Rules of this Court, parties filed and exchanged their briefs. The Appellant’s dated and filed October 5th, 2020 was settled by Mr. Victor Agunzi Esq. who urged that the appeal be allowed. The 1st Respondent’s dated October 27th, 2020, filed October 28th, 2020, was settled by M. E. Oru Esq., who urged that the appeal be dismissed. The 2nd and 3rd Respondents did not file any process herein.
NOTICE OF PRELIMINARY OBJECTION
The 1st Respondent raised a preliminary objection to the effect that the instant appeal is incompetent as the Appellant failed to seek and obtain the leave of Court before filing its Notice of Appeal.
In response, the Appellant’s Counsel submitted that the Notice of Appeal is valid and competent. That the instant appeal is one by virtue of Section 241(1) (b) of the 1999 Constitution as it is on issues of law alone and in support cited the case of MINISTER, FEDERAL CAPITAL TERRITORY V. ABDUULLAHI 2010.
I have carefully considered the submissions on both sides and one is in agreement with the learned Appellant’s Counsel. Section 241 (1) (b) states thus:
241-(1) An appeal shall lie from the decisions of the Federal High Court or a High Court to the Court of Appeal as of right in the following cases –
(b) where the ground of appeal involves questions of law alone, decisions in any civil or criminal proceedings.
I have carefully read the two (2) grounds of appeal as contained on pages 167-169 of the record and find that the issue of the jurisdiction and competence of the Court is in the main and more pronounced in ground 1 which therefore satisfies the stated Constitutional provision, being one of law as it is on the jurisdiction of the Court below. It is also the point in the singular Issue raised whether the Court could proceed without first going to arbitration.
In the light of the foregoing, the appeal of the Appellant is competent and in consequence, the objection by the 1st Respondent is hereby dismissed.
SOLE ISSUE FOR DETERMINATION BY THE APPELLANT
“Whether the Claimant can safely maintain an action in respect of two separate and distinct contract transactions subjoined in one suit without first exhausting the option for recourse to arbitration contained in one of the agreements and whether the trial Court ought to stay proceedings pending recourse to arbitration in respect of the agreement containing arbitration clause.” (Grounds 1 and 2)
SOLE ISSUE SUBMITTED BY THE 1ST RESPONDENT
“Whether or not the learned trial Judge was right when he held that the operative and extant agreement was that of 24th August, 2011 and that there was no arbitration clause therein which binds the parties.”
With a careful consideration of the two sets of issues submitted by both sides, one finds that they are similar in contents and purpose and will justly and fairly determine this appeal. It is in that regard that I adopt the sole issue by the Appellant.
SUBMISSIONS ON BEHALF OF THE PARTIES
APPELLANT’S SUBMISSION
The learned Counsel for the Appellant, Mr. Victor Agunzi Esq., submitted that according to law parties herein are bound by their agreement in so far as there was an offer and acceptance and the parties as well as the Court are not permitted to pick and choose which agreement or portions thereof should be relied upon. In support, he cited the cases of AFROTECH V. MIA & SON LTD. 2000 12 SC PT. 11 1, OWONIBOYS TECHNICAL SERVICES LTD. V. UNION BANK OF NIGERIA LTD. 2003 15 NWLR PT. 844 545, NIGERIAN PORTS AUTHORITY V. AHMED 2017 ALL FWLR PT. 892 1078 and ADIELE IHUNWO V. JOHNSON IHUNWO 2013 LPELR-20084 SC P.41 amongst others cited.
He argued that since the agreements sought to be enforced by the 1st Respondent as can be seen from her pleadings are those of 29/3/2010 and 24/8/2011, therefore the clause on arbitration becomes applicable as it is contained in the agreement of 29/3/2010. That the 1st Respondent cannot maintain an action in respect of the two contracts in one Suit without first and foremost exhausting the option for recourse to arbitration. And that the decision of the Court showed that it did not appreciate the claim of the 1st Respondent and so misdirected itself when it held the agreement of 24/8/2011 as the only operative agreement. Therefore, the Court ought to have stayed proceedings and cited Section 5 (1) of the Arbitration and Conciliation Act and the cases of R. C. O & S. LTD. V. RAINBOWNET LTD. 2014 5 NWLR PT. 1401 P. 516, NISSAN NIG. LTD. V. YOGANATHAN 2010 4 NWLR PT. 1183 P. 135 and OBEMBE V. WEMABOD ESTATES LTD. 1977 5 SC P. 115 amongst others cited. In conclusion, he urged that the sole issue be resolved in favour of the Appellant and its appeal be allowed.
1ST RESPONDENT’S SUBMISSION
Mr. Oru SAN, the learned Counsel for the 1st Respondent submitted that only parties to an agreement can determine their own terms as no other person can, not even the Court and cited in support the cases of NIMANTEKS ASSOCIATES V. MARCO CONSTRUCTION COMPANY LTD. 1991 2 NWLR PT. 174 411, ONUMINYA V ACCESS BANK PLC. 2015 9 NWLR PT. 1463, 159 and NWAOLISAH V. NWABUFOH 2011 14 NWLR PT. 1268, 600. He argued that there were three different agreements on 13/5/2008, for house at Bayelsa Street after conversion to the single storey detached house on 22/3/2010, another agreement on 29/3/2010 with arbitration clause and the conversion to the Jigawa Close housing unit as the final and extant agreement of 24/8/2011 has no arbitration clause between the Appellant and the 1st Respondent. He submitted that the last one is the applicable one as it was done independent of the earlier agreement and cited in support the cases of WEST AFRICAN OFFSHORE LTD. V. ARIRI 2015 18 NWLR PT. 1490, 177, EZENWA V. KATSINA STATE HEALTH SERVICES MANAGEMENT BOARD 2011 9 NWLR PT. 1251 and SAPARA V. U.C. H. BOARD 1988 4 NWLR PT. 86 58. In conclusion, he urged that the sole issue be resolved in favour of the 1st Respondent and the Appellant’s appeal be dismissed.
RESOLUTION OF THE SOLE ISSUE BY THE COURT
I have carefully and calmly considered all the processes filed by the parties herein as well as the Record and the Judgment of the Court, and having so carefully done, I shall proceed to determine the singular Issue along with the findings of the Court.
THE SOLE ISSUE
“Whether the Claimant can safely maintain an action in respect of two separate and distinct contract transactions subjoined in one Suit without first exhausting the option for recourse to arbitration contained in one of the agreements and whether the trial Court ought to stay proceedings pending recourse to arbitration in respect of the agreement containing arbitration clause.”
The Court found as follows in the ruling being appealed against:
That the “1st Respondent changed from type 2A house to type 3A single storey detached house with boys quarters and from house No. 5 Borno Close to No. 10 Jigawa Close with a formal letter by the Appellant in that regard on 28/8/2011.
That “It is common logic that the most recent letter of offer given to the Plaintiff is the most binding.”
See page 165 of the Record. The Court therefore held and concluded thus on pages 165-166 of the Record:
“I am therefore in total agreement with the Plaintiff/Respondent Counsel that the operative offer letter is the most current offer letter in respect of type 3A Olive Exclusive Homes executed between the Plaintiff and the 1st Defendant as in (sic) contained in the letter dated 24th August, 2011.
I have also dissected the said letter with a bird view eye and certified that it does not contain a resort to arbitration.
In view of the above, I am of the view that granting this application will not be in the best interest of justice and I so hold. Consequently, the application failed and same is accordingly dismissed.”
The law is that where an agreement contains arbitration clause, that parties should first refer any issue arising between them to arbitration, no party will be allowed or permitted to breach such. In the instant, the question that needs be answered is whether the parties contracted to first resort to arbitration before taking any legal or other step.
Further, it is trite that parties to an agreement are at liberty to determine the terms that bind them and the Court is not allowed to read terms which were not agreed to by the parties into their agreement. See the cases of AGBAREH & ANOR V. MIMRA & 2 ORS 2008 2 MJSC 134 and KAYDEE VENTURES LTD V. HON. MINISTER FCT & 7 ORS. 2010 7 NWLR PT. 1192 171.
From the record, one finds as follows with regard to the transactions between the 1st Respondent and the Appellant. On 13/5/2008, the Appellant offered the 1st Respondent a residential house, Plot no. 1 Bayelsa Street in respect of which she deposited some money. See pages 63 to 69 of the Record. The Appellant vide a letter dated March 22nd, 2010 agreed to change 1st Respondent’s house type 2A to Olive Exclusive home and by an offer letter of March 29th, 2010, the 1st Respondent agreed to the change as contained on pages 71 to 73 of the Record. On page 73, one finds that the 1st Respondent agreed that “all disputes arising in connection with this offer letter shall be settled in accordance with the Rules of Arbitration and Conciliation Act, Laws of the Federation of Nigeria.” The contract further stated thus; “This Offer, supersedes any prior Offer or Agreement”
If the foregoing were the last and final agreement between the parties, simply, there will be no argument or confusion as to what the position of the law is between them and clearly, the correct step by law would be to proceed to arbitration, not litigation. But that was not the last agreement between the parties as can be seen in the Record. At page 75 of the Record, one finds vide the Appellant’s letter of February 2011 that the 1st Respondent’s request to change from the residential house of Block No. 5 Borno Close to Block No. 10 Jigawa Close was granted. It stated that the terms and conditions of the Offer Letter of March 29th 2010 remain unchanged. On February 14th, 2011, the 1st Respondent further requested a change for a corner piece house on the Appellant’s estate and that she would abide by the terms and conditions in the offer letter. See page 76 of the Record. The Appellant in response granted the request vide an offer letter dated August 24th, 2011 and gave her Plot No. 07 Borno Close. Clearly, the letter stated as contained on page 82 of the Record that “The allocation is governed by the terms and conditions stated below and any other conditions that may be specified in the Lease Agreement.” The Offer Letter further on page 83A of the Record states thus: “This Offer supersedes any prior Offer or Agreement.”
It is pertinent to note that the foregoing was the last subsisting agreement between the parties up until the action instituted by the 1st Respondent. It needs be noted that through the length and breadth of the Offer Letter no mention or reference was made to arbitration. Importantly, it is clear that the agreement was over and above any that had been between the parties as same was so stated. In my view and humbly, there is no gainsaying that the Offeror, the Appellant, clearly intended the agreement of August 24th, 2011 with its terms and conditions without any arbitration clause to bind the parties as the extant terms between them and likewise the Offeree, the 1st Respondent, understood and accepted the said terms and conditions as such and both parties so agreed.
According to the Record, the 1st Respondent had an outstanding of about N5,760,000 to pay, which she held unto when there were signs even from other buyers of the houses that, the Appellant was not performing his part of the building agreement and for that reason she commenced an action at the Court below against the Appellant, vide her writ of summons. From the totality of the Record, the 1st Respondent was not bound by the clause or provision to proceed to arbitration first after the change of house to Plot 7 Borno Borno Close, vide Letter of August 24th, 2011, which specifically stated that the offer supersedes any prior offer or agreement.
That being the position, one is unable to disagree with the position and the conclusion reached by the Court below that it would not be in the interest of justice to grant the Appellant’s application to stay the proceedings of the Court for the parties to resort to arbitration as there was no such binding agreement. The sole issue in this appeal is resolved against the Appellant.
In the result, this appeal cannot be allowed and is hereby accordingly dismissed. The ruling of the Court below delivered on June 23rd, 2016 by Hon. Justice Bello Kawu of the Federal Capital Territory High Court, is consequently affirmed.
STEPHEN JONAH ADAH, J.C.A.: I had the benefit of reading in draft the judgment just delivered by my learned brother, Elfrieda Oluwayemisi Williams-Dawodu, JCA.
The law is settled that parties are bound by their terms of contract. The Court cannot re-write for the parties their terms of contract. See Oforishe v. Nigerian Gas Co. Ltd. (2018) 2 NWLR (Pt. 1602) 35, Nika Fishing Co. Ltd. v. Lavina Corporation (2008) LPELR – 2035 (SC), JFS Investment Ltd. v. Line Ltd & Ors., (2010) LPELR – 1610 (SC).
From the records before this Court in this case, the parties entered into a contract and the extant agreement does not contain recourse to arbitration. The Court cannot therefore, import into the contract any extraneous term not contemplated by the parties.
I am therefore, in agreement with the reasoning and the conclusion of my learned brother in the lead Judgment that the appeal is lacking in merit and that it be dismissed. I also dismiss the appeal. I abide by the consequential orders.
DANLAMI ZAMA SENCHI, J.C.A.: I was in conference of the panel of Justices that heard this appeal and I had the privilege of reading in draft the lead judgment of my learned brother, E. O. WILLIAMS-DAWODU, JCA just delivered, and the lead judgment substantially captured all the issues I raised during the conference. I therefore agree with the findings and conclusions reached therein that this appeal lacks merit and it is accordingly dismissed by me as well.
The ruling of the High Court of the Federal Capital Territory in Suit No. FCT/HC/CV/2522/15, delivered on the 23rd day of June, 2016 by Bello Kawu J., is hereby affirmed.
Appearances:
Mr. Victor Agunzi For Appellant(s)
Mr. Marcel Oru SAN with him Mr. Noah Adamu Esq and Ogbenyealu Egelamba Esq. for 1st Respondent For Respondent(s)
