MR. P.D.O OKEREKE & ANOR v. ABA NORTH LOCAL GOVERNMENT AUTHORITY
(2014)LCN/7369(CA)
In The Court of Appeal of Nigeria
On Wednesday, the 9th day of July, 2014
CA/PH/179/2004
RATIO
CONTRACT: FRUSTRATION OF CONTRACT; THE MEANING OF FRUSTRATION OF CONTRACT, WHEN FRUSTRATION OCCURS AND THE EVENTS THAT CONSTITUTE FRUSTRATION
The import or meaning of frustration of contract has been stated and restated many times, by the apex court to be the prevention or hindering of the attainment of a goal and when a contract becomes incapable of being performed by unforeseen circumstances. See the case of G. N. NWAOLISAH VS. PASCHAL NWABUFOH (2011) 14, NWLR (PART 1268) 600 at 630 H to 631 A – F where ADEKEYE, JSC said:
“Frustration occurs wherever the law recognizes that without default of either party, a contractual obligation has become incapable of being performed because the circumstances in which performances is called for would render it radically different from what was undertaken by the contract.”
The events which have been listed by the court to constitute frustration are:
(1) Subsequent legal changes or statutory impossibility;
(2) Outbreak of war;
(3) Destruction of the subject matter of the contract or literal impossibility;
(4) Government acquisition of the subject matter of the contract;
(5) Cancellation by an unexpected event like where other party to a contract for personal service, dies or where either party is permanently incapacitated by ill-health, imprisonment etc from rendering the service he has undertaken. Davies Contractors Ltd. V. Fareham NDC (1956) AC 696; Akanmu v. Olugbode (2001) 13 WRN 132; NBCI v. Standard (Nig.) Eng. Co. Ltd. (2002) 8 NWLR (Pt. 768); G. 104. Obayuwana v. the Governor of Bendel State (1982) SC pg. 167, (1983) 4 nclr 96; Taylor v. Caldwel (1963) 3 B & Y S 826; J.P. Dawodu v. B. Anderson & Co. Ltd. (1925) 6 NRL pg. 106; Adu v. Makanjuola (1944) 10 WACA Pg. 168. A contract is not frustrated merely because its execution becomes more difficult or more expensive than either party originally anticipated and has to be carried out in a manner not envisaged at the time of its negotiation. Davis Contractors Ltd. V. Fareham N.D.C (1956) AC 695; Tsakineglon & Co. v. Noblee Thorh G.M.B.H. (1962) AC 93. per. PETER OLABISI IGE, J.C.A.
CONTRACT: BREACH OF CONTRACT; WHETHER FAILURE TO PERFORM A CONTRACT WITHIN THE LIMIT WILL CONSTITUTE A BREACH
Finally, the law is that time is of essence where the parties have expressly made it so, or where circumstances show that it is intended to be of essence or where a definite time if fixed for execution of a mercantile and the contract even though time is not expressly made of the essence. Thus failure to perform the contract within the limit will constitute a breach.
Performance must be rendered within a reasonable time in the absence of any specification as to time in the contract itself.” See also ATTORNEY-GENERAL, CROSS RIVER STATE VS. ATTORNEY-GENERAL OF THE FEDERATION & ANOR (2012) 16 NWLR (PART 1329) 425 AT 479 H – 480 A – F. per. PETER OLABISI IGE, J.C.A.
CONSTITUTIONAL LAW: FUNDAMENTAL RIGHT TO FAIR HEARING; WHETHER IT IS A BREACH OF FAIR HEARING FOR A COURT TO RAISE A POINT SUO MOTU WITHOUT WRITING THE PARTIES OR THEIR COUNSEL TO ADDRESS THE COURT ON THE POINT
The law is trite that where a court raises a point suo motu it behooves the court to give opportunity of being heard to the parties affected to air their views on the point raised. See the case of ALHAJI TSOHO DAN AMALE VS. SOKOTO LOCAL GOVERNMENT & ORS (2012) 5 NWLR (part 1292) 181 at 202 C where FABIYI, JSC “It is the law that a court should not raise a point suo motu, no matter how clear it may appear to be, and proceed to resolve same without writing the parties or their counsel to address the court on the point. This is to avoid a breach of parties’ right to fair hearing.” per. PETER OLABISI IGE, J.C.A.
COURT: INTERFERENCE; WHETHER A COURT OF APPEAL WILL NOT INTERFERE WITH THE FINDINGS OF A TRIAL COURT UNLESS IT IS PERVERSE
Now the law is trite that a Court of Appeal will not interfere with the findings of a trial court unless it is satisfied that such a finding is perverse or that the trial court did not utilize properly the opportunity of seeing and hearing the witnesses. It must be demonstrated that the trial judge misapplied the facts and evidence before him which occasion a miscarriage of justice. See the cases of THE STATE VS. AHMED RABIU (2013) 8 NWLR (PT 1357) 585 AT 603 H TO 604 A – B PER ALAGOA JSC. (2) ALHAJI UMARU SANDA NDAYAKO & ORS VS. ALHAJI HALIRU DANTORO & ORS (2004) 13 NWLR (PT 889) 187 AT 220 B – C PER EDOZIE JSC. per. PETER OLABISI IGE, J.C.A.
JUSTICES
IGNATIUS IGWE AGUBE Justice of The Court of Appeal of Nigeria
PETER OLABISI IGE Justice of The Court of Appeal of Nigeria
FREDNARD O. OHO Justice of The Court of Appeal of Nigeria
Between
1. MR. P.D.O OKEREKE
2. MESSRS PADOSONS BROTHERS COMPANY LIMITED Appellant(s)
AND
ABA NORTH LOCAL GOVERNMENT AUTHORITY Respondent(s)
PETER OLABISI IGE, J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of High Court of Abia State contained in the judgment of Hon. Justice O. A. Otisi delivered on the 12th day of March, 2003.
The Appellants as Plaintiffs had approached the High Court of Abia State Aba Judicial Division on 4th day of July, 1997 for the issuance of writ of summons against the Respondent wherein they claimed against the said Respondent for the following reliefs namely:
“1. A declaration of the Honourable court that the failure of the Defendant to comply with the terms of the agreements dated the 22nd day of June, 1992 and the 27th day of July, 1992 amounts to a breach of contract on the part of the Defendants.
2. The sum of N7,000.000.00 (Seven Million Naira) being special and general damages resulting to the Plaintiffs from the Defendant’s breach of contract evidenced in the agreements between the Plaintiffs and the Defendant dated the 22nd day of June, 1992.”
The writ was issued out on 7th day of July 1997. The Respondent was duly served but it did not enter appearance and no Defence was filed.
The Appellants amended their statement of claim pursuant to the leave granted in that behalf by the lower court. The amendment was effected on 9th May 2001. In paragraph 18 of the said Amended Statement of Claim the Appellants claimed the following reliefs viz:
WHEREOF the Plaintiffs are damnified and they jointly claim against the Defendant the sum of N7,000,000.00 (Seven Million Naira) as special and general damages against the Defendant.
PARTICULARS OF SPECIAL DAMAGE
a. The Plaintiffs employed the service of the following from the 25th day of June 1992 to the 28th day of July 1992 at the following rate:
i. One excavator machine for N125,000.00 (One Hundred and Twenty Five Naira) at N5,000.00 (Five Thousand Naira) per day for twenty five days.
ii. Six tippers for N225,000.00 (Two Hundred and Twenty Five Thousand Naira) at N1,500.00 (One Thousand Five Hundred Naira) a tipper per day.
iii. Three labourers for N30,000.00 (Thirty Thousand Naira) at N400 Naira (Four Hundred Naira) per day for twenty five days.
iv. The sum of N2,000.00 (Two Thousand Naira) paid to labourers that removed electric pole along the Aba big gutter.
b. On the 5th day of August 1992, the sum of N7,150 (Seven Thousand, One Hundred and Fifty Naira) was paid to the labourers for clearing Obiora site.
c. On the 11th day of December 1992, the sum of N9,115.00 (Nine Thousand One Hundred and Fifteen Naira) was paid to Chikezie Owoh as deposit for clearing the proposed Ogbor-Hill tyre Market.
d. The council collected the sum of N300,000.00 (Three Hundred Thousand Naira) as part payment of the agreed non-refundable fees to the council.
GRAND TOTAL = N698,265.00
Though duly served with all processes the Respondent did not respond to the Appellants’ suit whereupon the lower court granted the application of the Appellants to prove their case on the merit.
Hearing Notices were also issued and served upon the Respondent intimating her of the hearing of the suit yet the Respondent did not turn up. The Appellant called three witnesses who were not cross examined by the Respondent. Address of Learned Counsel to the Appellant was taken and matter was adjourned for judgment on 12th day of June, 2002 but was eventually delivered on 12th day of March 2003.
In the considered judgment, the Learned Trial Judge found against the Appellants and dismissed their suit. On pages 70 – 72 of the record the trial judge had this to say: –
“The evidence before the court does not suggest the Defendant is to be blamed for the intervention of the Aba South Local Government staff that effectively stopped any further performance of both contracts. The circumstance was beyond the control and original contemplation of the parties. Having regard to the evidence before the court and to the guiding principles enunciated by the Supreme Court in MAZIN ENG. LTD. (SUPRA), I hold that there was no breach of contract but frustration of both contracts. And having regard to these same principles, I hold the Plaintiff is not entitled to any damages. The special damages claimed can also not be recovered. The money collected by the Defendant has been stated to be agreed nonrefundable fees in the statement of claim and in paragraph 2 of Exhibit ‘A’. Having paid the sum stipulated with the understanding that it is not refundable, I do not see how the court can now vary that term of the contract by ordering a refund of the sum. On the payment in respect of the second contract, paragraph (8) of Exhibit ‘B’ stipulates that the sum of N500,000.00 represents the Defendants share from the sale of the stores and should be paid before the actual sale of the stores commences.
The evidence of PW1 on this issue is instructive.
PW1 said that he made a part payment of N150,000.00 to the Chairman of the Defendant, who asked him to hand over the money to his secretary. There was no official receipt tendered in proof of this payment.
Although PW3 testified that he was aware that the Plaintiff paid this money, he has not stated the source of his information. The Plaintiff as PW1 did not testify that PW3 was present when he made the payment and as observed above, no official receipt was tendered. I do not see how this payment can be recovered from the Defendant.
Exhibit ‘C’ is a letter of intent to enter into a third contract, from the Defendant to the Plaintiff. Certain conditions for negotiation were stipulated therein. There is nothing before the court to show either that these conditions were complied with or that there was actually any contractual agreement between the parties before the plaintiff proceeded to engage labourers to clear the area of land allocated for the construction of the tyre market in Ogbor Hill.
A valid contract must be evidenced by an offer, acceptance, consideration, intention to create a legal relationship and capacity to contract.
These conditions must co-exist before a valid contract is made, see PETROLEUM TRAINING INSTITUTE VS. UWAMU (2001) 5 NWLR (PT 705) 112 at 122. If the Plaintiff upon Exhibit ‘C’ went ahead, without a formal contract to commit his money, I do not see how the Defendant can be held responsible for that.
Moreover, from the evidence of PW1, the Plaintiff, elders from the Ogbor Hill community stopped further performance of any contract on the ground that they had earlier sold the land to a third party. In other words, that portion of land was not that of the Defendant to deal with.
Unfortunately, there was no contract to ascertain the terms thereof. I hold, therefore, that the Defendant cannot be held liable for any losses incurred by the Plaintiff therein.
Having regard to the foregoing, I find the Defendant not liable on the Plaintiff’s claims, the two earlier contracts having been frustrated, and in respect of the third, there being no contract to enable court ascertain its terms. This matter is accordingly, hereby dismissed.”
Aggrieved by the decision of the lower court the Appellants appealed to this court vide their Notice of Appeal dated 28th day of May, 2003 and filed on 3rd day of June, 2003 containing three grounds which with their particulars are as follows:
“GROUNDS OF APPEAL
1. ERROR IN LAW
The Learned Trial Judge erred in law by failing to enter judgment for the Appellants on the standard of minimal proof of their claim in the absence of statement of defence any evidence or participation by the Respondent in the proceedings thereby occasioning a miscarriage of justice.
Particulars of Error
(a) The Appellants filed statement of claim and adduced evidence consistent with the statement of claim in proof of their case/claim.
(b) The Respondent did not file statement of defence.
(c) The Respondent failed to attend court despite and in spite of several hearing notices and adjournments to enable it attend court and participate in trial/hearing proceedings.
(d) There was no defence to the Appellants claim and no attempt was made to proffer any.
(e) The Learned Trial Judge failed to act on the unchallenged and uncontroverted evidence.
2. ERROR/MISDIRECTION IN LAW
The Learned Trial Judge erred and misdirected the court below in law when in the judgment the said Learned Trial Judge conducted the defence for the Respondent who did not file any statement of defence, adduced no evidence, refused to participate howsoever in the proceedings, refused to attend the court and showed no interest whatsoever in the court and showed no interest whatsoever in the suit and the entire trial proceedings thereby occasioning a miscarriage of justice.
PARTICULARS OF ERROR
(a) The Learned Trial Judge made rather strange and considerable effort in the judgment to set up defence/defences which were neither pleaded nor convassed by any of the parties to the suit.
(b) “Frustration” is a special defence which must be specifically pleaded so as not to take the opposite party by surprise. See the Abia State High Court Rules, Order 25, Rule 6. The Court having raised that defence SUO MOTU should have called on Appellants counsel to address the court on it.
(c) It was not the duty of the Learned Trial court to set up a defence for the Respondent who refused to file statement of defence, adduced no defence, refused to participate howsoever in the proceedings, refused to attend the court and showed no interest whatsoever in the suit and the entire trial proceedings.
(d) The Learned Trial Judge assumed the function of the defence counsel who refused to attend the court and/or take any step to defend the Respondent at the trial proceedings in the suit.
(e) It was not the duty of Learned Trial Judge to invent a defence for the Respondent who showed no interest in the Suit and the proceedings thereof.
(f) The Learned Trial Court below went out of its way to invent technicalities to defeat the unchallenged and uncontested claim of the Appellant.
(g) The Appellants in the court below fought their case against a formidable adversary in the person of the Learned Trial Judge who ably represented the absent and uninterested Respondent who completely refused to participate in the proceedings and boycotted the same.
3. ERROR IN LAW
The Learned Trial court erred in law when it failed to award adequate and appropriate compensation to the Appellants for money expended by them pursuant to the execution of the contracts at the behest of the Respondent thereby occasioning a miscarriage of justice.
PARTICULARS OF ERROR
(a) The Appellants pursuant to the execution of the contracts and at the behest of the Respondent had incurred huge expenditures of money before it became impossible due to no fault of theirs to continue rendering their contractual services to the Respondent.
(b) That the said contract could not be fully and completely executed not the fault of the Appellants.
(c) All the facts contained in Suit paragraphs (a) and (b) above were contained evidence of the Appellants at the court below.”
The Appellants filed their Brief of Argument dated 31st day of August, 2004 on 21st day of September, 2004. When this appeal came up for hearing on 5th day of June, 2014 the Learned Counsel to the Appellants J. O. Emelike Esq. who held the brief of K. C. Nwufo Esq. informed the Court that an order was made by this Court upon the application by the Appellants that this appeal be argued on the brief of Argument of Appellants alone.
The said Learned counsel was allowed to argue the appeal. The Learned Counsel for the Appellants adopted their Brief of Argument and urged this Court to allow the appeal.
The Appellants formulated three issues for the determination of this appeal viz:
a. Whether the Learned Trial Judge was right in failing to enter judgment for the Appellants on the standard of minimal proof of their claims in the absence of any statement of Defence or any evidence in contradiction of the evidence of the Plaintiffs’ witnesses.
b. Whether the Learned Trial Judge was right in dismissing the Plaintiffs’ case on the ground of a purported frustration of the contract between the Plaintiffs and the Defendant when there was no such pleading and evidence before the trial court?
c. Whether the Learned Trial Judge was right in refusing to award adequate and appropriate compensation/damages to the Appellants for money expended by them pursuant to the execution of the said contract?
I must state that notwithstanding that the Respondent failed to file a Respondent’s Brief of Argument, an Appellant should not take it for granted or begin to jubilate that he has already won the appeal. It is the force in the Appellants Brief of Argument supported by settled position of the law that will operate in his favour in the appeal even though the Respondent may be taken as having conceded the appeal. See UNITY BANK PLC & ANOR VS. MR. EDWARD BOUARI (2008) 2 S.C. M. 193 at 211 to 212 per OGBUAGU, JSC who said:
“In the line of decided authorities, it has been held that failure of a Respondent to file a Reply Brief, is immaterial. This is because, an Appellant will succeed on the strength of his case. But a Respondent will be deemed to have admitted the truth of everything stated in the Appellants Brief in so far as such is borne out by the Records. In other words, it is not automatic. An Appellant must succeed or fail on his own Brief. See the cases of JOHN HOLT VENTURE LTD V. OPUTA (1996) 9 NWLR (PT 470) 101 C.A., ONYEJEKWE V. THE NIGERIA POLICE COUNCIL (1996) 7 NWLR (PT 463) 704 C.A; WAGRI VS. WAZIRI (1998) 1 NWLR (PT 533) 322 C.A. AND UBA PLC V. AJILEYE (1999) 13 NWLR (PT.633) 116 CA.
Just to mention but a few”
See also the decision of this court in the case of STABILINI VISIONI NIG. LTD. VS. SANDERTON VENTURES LTD (2011) 8 NWLR (PART 1249) 258 AT 272H – 273A WHERE OKORO, JCA (NOW JSC) had this to say:
“Let me quickly add that it is not the law that where a Respondent fails to file his brief, judgment must be entered for the Appellant, far be it. An Appellant in such circumstance still has the duty of convincing the court that he is entitled to judgment. Therefore, though the Respondent has not filed brief in this appeal, I shall treat the issues raised by the Appellant in line with the relevant laws and authorities available for the purpose of reaching fair decision.”
I will do the same in this appeal.
ISSUE A
It is the submission of the Learned Counsel to the Appellants K. C. Nwufo Esq. that the Learned Trial Judge erred in law when he failed to enter judgment in favour of the Appellants on the standard of minimal proof of their claims in the absence of any statement of Defence as well as any contrary evidence from the Defendant Respondent in the proceeding. That the Appellants gave oral and documentary evidence before the lower court and that the evidence was not challenged by the Respondent. That the only duty the Learned Trial Judge had was to have entered judgment for the Appellants relying on the case of HYACINTH NWACHUKWU NZERIBE VS. DAVE ENGINEERING COMPANY LIMITED (1994) 9 SCNT 161 AND THE CASE OF BROADLINE ENT. LTD VS. MONTEREY MARITIME CORN (1995) 10 SCNJ 1 AT 22 PER IGUH JSC.
As could be seen in this matter the Defendant now Respondent in this court did not at any point in time enter appearance and neither did it file statement of Defence to the suit of the Appellants. The Respondent did not appear at the trial to even cross examine any of the witnesses for the Appellants. That to my mind constitute an admission of the evidence proffered by the Appellants at the trial court. See ISAAC GAJI & ORS vs. EMMANUEL PAYE (2003) 8 NWLR (PART 823) 583 at 605 A – C per EDOZIE, JSC. The law remained settled that where evidence tendered or proffered by a Plaintiff and his witnesses is not challenged or controverted by a Defendant, the court is entitled to accept the evidence as establishing the case against the Defendant. See ISAAC OMOREGBE VS. D. P. LAWANI (1980) 3 – 4 SC 108 at 117 per IDIGBE, JSC who said”
“Again, this court has in many of its decisions observed that where evidence given by a party to any proceedings was not challenged by the opposite party who had her opportunity to do so, it is always open to the court seized of the procedures to act on the unchallenged evidence before it.”
Adjunct to this is that if a Defendant fails to call evidence at trial of an action then the onus of proof on the claimant will be discharged on minimal proof. See A.A. AJIDAHUN VS. MS D. O. AJIDAHUN (2000) 4 NWLR (PART 654) 605 at 645 per GALADIMA JCA (now JSC).
All the paragraphs of the Amended Statement of Claim filed by the Appellants are deemed admitted by the Respondent for her failure to deny them specifically or by implication. I call in aid the case of T. LAWAL OWOSHO & ORS VS. MICHAEL ADEBOWALE DADA (1984) 7SC 149 at 163 – 164 per ANIAGOLU JSC who said:
“But a Plaintiff need not proceed to prove an admitted fact. And a fact is deemed to be admitted if it is neither specifically denied nor denied by implication, having regard to other facts averred in the pleadings. A plaintiff’s averments of facts must be met by the Defendant frontally and categorically.
The rules of pleadings do not allow a Defendant to be hedgy or evasive in his answers to the facts averred by the Plaintiff.
Once he refuses to meet the facts directly either by admitting them or by denying them, except of course, where he is not in a position to admit or deny by reason of the matter for example, being peculiarly within the knowledge of the Plaintiff – he is taken to have admitted them.”
I am of the view that the lower court was wrong in failing to give to the Appellants judgment they are entitled or proved before the lower court. It is not the business of the court to hold forth for any party especially a Defendant who fails to defend an action unless the Plaintiffs claims are manifestly unsupported by evidence led and the applicable law.
Issue A is resolved in favour of the Appellants.
ISSUE B
Whether the learned Trial Judge was right in dismissing the Plaintiffs’ case on the ground of a purported frustration of the contract between the Plaintiffs and the Defendant when there was no such pleading and evidence before the trial court.
The Learned Counsel to the Appellants submitted that the Learned Trial Judge erred in law when he suo motu raised the issue of “FRUSTRATION OF THE CONTRACT” between the Appellants and the Respondent without affording the Plaintiffs the opportunity of addressing the court on the said issue before basing his judgment thereon. That the issue of frustration as a defence is a special one which must be specifically pleaded by the Defendant or any party relying on it, and that in this case the Plaintiff did not plead frustration of the contract and the Defendant did not as required by the provisions of Order 25 Rule 6 of the Abia State High Court (Civil Procedure) Rules 2001 to raise issue of frustration of the contract. That the Defendant never showed up nor did it show interest in the proceedings and that the trial Court ought to have given opportunity to Plaintiffs to address it in order to display maintenance of judicial neutrality.
He relied on the case of L. A. ABIMBOLA V. SAKA ABATAN (2001) 4 SCNJ 73 and O. K. OYEKANMI VS. NEPA (2000) 12 SCNJ 73.
That even if frustration of contract could be raised in favour of Respondent though not conceded, that the frustration was self-induced and caused by the Defendant now Respondent’s negligence. He relied on the case of MARITIME NATIONAL FISH LTD VS. OCEAN TRAWLERS LIMITED (1935) A. C. 524 at 531. He urged the court to answer Issue B in the negative and allow the appeal.
Now a contract may be discharged through numerous ways or events namely:
(a) By performance.
(b) By agreement – where both parties have mutually agreed to put an end to it.
(c) By frustration – that is if some event outside the control of the parties take place making the performance impossible and
(d) By breach.
The Learned Trial Judge in her judgment held on page 70 of the record thus:-
“The evidence before the court does not suggest the Defendant is to be flamed for the intervention of the Aba South local Government staff that effectively stopped any further performance of both contracts.
The circumstances was beyond the control and original contemplation of the parties.
Having regard to the evidence before the court and to the guiding principles enunciated by the Supreme Court Mazin Eng. Ltd supra, I hold that there was no breach of contract but frustration of both contracts. And having regard to these same principles, I hold the Plaintiff is not entitled to any damages. The special damages claimed can also not be recovered. The money collected by the Defendant has been stated to be agreed’ non refundable fees’ in the statement of claim and in paragraph 2 of Exhibit ‘A’.
The import or meaning of frustration of contract has been stated and restated many times, by the apex court to be the prevention or hindering of the attainment of a goal and when a contract becomes incapable of being performed by unforeseen circumstances. See the case of G. N. NWAOLISAH VS. PASCHAL NWABUFOH (2011) 14, NWLR (PART 1268) 600 at 630 H to 631 A – F where ADEKEYE, JSC said:
“Frustration occurs wherever the law recognizes that without default of either party, a contractual obligation has become incapable of being performed because the circumstances in which performances is called for would render it radically different from what was undertaken by the contract.”
The events which have been listed by the court to constitute frustration are:
(1) Subsequent legal changes or statutory impossibility;
(2) Outbreak of war;
(3) Destruction of the subject matter of the contract or literal impossibility;
(4) Government acquisition of the subject matter of the contract;
(5) Cancellation by an unexpected event like where other party to a contract for personal service, dies or where either party is permanently incapacitated by ill-health, imprisonment etc from rendering the service he has undertaken. Davies Contractors Ltd. V. Fareham NDC (1956) AC 696; Akanmu v. Olugbode (2001) 13 WRN 132; NBCI v. Standard (Nig.) Eng. Co. Ltd. (2002) 8 NWLR (Pt. 768); G. 104. Obayuwana v. the Governor of Bendel State (1982) SC pg. 167, (1983) 4 nclr 96; Taylor v. Caldwel (1963) 3 B & Y S 826; J.P. Dawodu v. B. Anderson & Co. Ltd. (1925) 6 NRL pg. 106; Adu v. Makanjuola (1944) 10 WACA Pg. 168.
A contract is not frustrated merely because its execution becomes more difficult or more expensive than either party originally anticipated and has to be carried out in a manner not envisaged at the time of its negotiation. Davis Contractors Ltd. V. Fareham N.D.C (1956) AC 695; Tsakineglon & Co. v. Noblee Thorh G.M.B.H. (1962) AC 93.
Finally, the law is that time is of essence where the parties have expressly made it so, or where circumstances show that it is intended to be of essence or where a definite time if fixed for execution of a mercantile and the contract even though time is not expressly made of the essence. Thus failure to perform the contract within the limit will constitute a breach.
Performance must be rendered within a reasonable time in the absence of any specification as to time in the contract itself.”
See also ATTORNEY-GENERAL, CROSS RIVER STATE VS. ATTORNEY-GENERAL OF THE FEDERATION & ANOR (2012) 16 NWLR (PART 1329) 425 AT 479 H – 480 A – F.
The parties did not plead frustration of contract which is a defence in most cases to justify failure to perform a contract by one of the parties.
The Defendant did not come forward to plead any special defence. It was the Defendant now Respondent who owed the Appellants an obligation to provide them with a land with sound title to enable them carry out the contract. It cannot be in the contemplation of the contractual agreements Exhibits ‘A’ and ‘B’ that the Appellants should lose their investments on account of the failure of the Respondent to provide them land belonging to the Respondent. It was sheer negligence on the part of the Respondent.
There is no evidence from Respondent to tell the court why they were unable to provide any encumbrance free land for the project. The Appellants did not deliberately go out of their ways to start construction of lock up shops on the land of Aba South Local Government or that of the community that chased away the Appellants. It was the Respondent who put the Appellants in possession of the two separate lands to build shops for them. The same Respondent on two occasions asked the Appellants to pay nonrefundable fees part of which the Appellants paid. On each occasion and from the evidence on record the Respondent was fully briefed. It is the Respondent that failed to perform its own side of the contract which led the Appellants committing their funds towards the project on the two occasions.
Specifically clause 4 of Exhibit ‘A’ of the contract between the parties provides:
“It is further agreed that the time within which to commence work as prescribed in 2 above, it shall be lawful for the employer to determine the contract agreement by notification in writing to the contractor – financier the Council shall protect the interest of the Contractor/financier from any disturbance of any quarters.”
Paragraph 9 of the 2nd Agreement between the parties also stipulates thus:
“9 that this agreement remains binding on both parties unless duly terminated as provided in paragraph 15 above.”
There is also no evidence from the Respondent showing the termination of the contract. Exhibit “A” was executed on 24th day of June 1992 while Exhibit “B” came into existence on 29th July 1992.
The law is trite that where a court raises a point suo motu it behooves the court to give opportunity of being heard to the parties affected to air their views on the point raised. See the case of ALHAJI TSOHO DAN AMALE VS. SOKOTO LOCAL GOVERNMENT & ORS (2012) 5 NWLR (part 1292) 181 at 202 C where FABIYI, JSC
“It is the law that a court should not raise a point suo motu, no matter how clear it may appear to be, and proceed to resolve same without writing the parties or their counsel to address the court on the point. This is to avoid a breach of parties’ right to fair hearing.”
The Learned Trial Judge was therefore wrong when he raised suo motu the issue as to frustration of the contract between the parties to this appeal without affording the parties particularly the Appellants the opportunity of being heard, before taking a decision on the issue.
The contract was not vitiated by frustration as per the oral and documentary evidence before the lower court. Issue B is resolved in favour of the Appellants against the Respondent.
ISSUE C
Whether the Learned Judge was right in refusing to award adequate and appropriate compensation to the Appellants for money expended by them pursuant to the execution of the said contract.
The Appellants submitted that the Learned Trial Judge erred in law when he refused to award any damages by way of compensation to the Plaintiffs/Appellants for breach of contract and for money expended by them in pursuance of the execution of the contracts at the behest of the Respondent. The Appellants relied on the evidence of PW1, PW2 and PW3 and Exhibits D – D2 containing of recorded expenses incurred, according to the Appellants, in the course of executing the two contracts in Exhibits ‘A’ and ‘B’ respectively. That the lower court ought to have awarded both special and general damages to the Appellant as flowing naturally from the breach of the said contracts. The Learned Counsel to them K.C. Nwufo Esq. relied on the case of EMMANUEL AGBANELU vs. UNION BANK of NIGERIA LIMITED (2000) 4 SCMK 453 AND ACME BUILDERS LTD VS. KADUNA STATE WATER BOARD & ANOR (1999) 2 SCNJ 25.
That the Learned Trial Judge also failed to assess the damages to which Appellants were entitled notwithstanding that he dismissed the claim. He relied on the case of IFEANYICHUKWU (OSONDU) COMPANY LTD VS. SOLEH BONEH (NIG) LTD (2000) 3 SCNJ 18. The Appellants urged this court to answer issue C in the negative and to allow the appeal.
Now the law is trite that a Court of Appeal will not interfere with the findings of a trial court unless it is satisfied that such a finding is perverse or that the trial court did not utilize properly the opportunity of seeing and hearing the witnesses. It must be demonstrated that the trial judge misapplied the facts and evidence before him which occasion a miscarriage of justice. See the cases of THE STATE VS. AHMED RABIU (2013) 8 NWLR (PT 1357) 585 AT 603 H TO 604 A – B PER ALAGOA JSC. (2) ALHAJI UMARU SANDA NDAYAKO & ORS VS. ALHAJI HALIRU DANTORO & ORS (2004) 13 NWLR (PT 889) 187 AT 220 B – C PER EDOZIE JSC.
The lower court misdirected himself on the unchallenged and uncontroverted evidence before him in failing to award to the Appellants the special damages pleaded and proved before the trial court. The lower court also failed to award general damages to the Appellants on the facts exposed to the court by PW1, PW2 and PW3. I am of the settled view that the Appellants were/are entitled to the sum of N398,265.00 made up of items (i) (ii) (iii) (iv) (a) (b) and (c) under particulars of special damages.
The Respondent is deemed to have admitted the said claims. See (1) CAMEROON AIRLINES VS. MIKE E. OTUTU 1211 (2011) 1 SCM 70 at 92 C – E per RHODES -VIROURS, JSC who said:
“My Lords, it is well settled that where evidence given by a party in proceedings is not challenged by the adverse party who had the opportunity to do so, the court ought to act positively on the unchallenged evidence before it. Odulaja v. Haddad (1973) 11 SC p. 35 Nwabuoku v. Ottih (1961) 2 SCLR p. 232 decisions of this court are clear on this point.
The unchallenged testimony of the Respondent, not challenged by the Appellant, that his briefcase containing N20,000 and some valuable items was taken away from him by South African Immigration Officials and never returned to him is affirmative evidence that Respondents claim for Special damages for N20,000 is justified since the Appellants act of flying the Respondent to South Africa without justification was responsible for the loss.”
(2) Military Governor of Lagos State & Ors vs. ADEBAYO ADEYIGA & ORS (2012) SCM 183 at 211 where Adekeye, JSC had this to say:
“The evaluation of evidence in the instant suit before the trial court was based on the unchallenged evidence of the Plaintiffs/Respondents. The position of the law where evidence is unchallenged or uncontroverted is that such evidence will be accepted as proof of a fact it seeks to establish.
A trial court is entitled to rely and act on the uncontroverted or uncontradicted evidence of a Plaintiff or his witness. In such a situation, there is nothing to put or weigh on the imagery scale of justice. In the circumstance the onus of proof is naturally discharged on a minimum proof.”
The appeal of the Appellants is meritorious and it is allowed. The judgment of the lower court delivered on 12th day of March, 2003 dismissing the Appellants suit is hereby set aside.
The Appellants are not entitled to a refund of N300,000 paid as non refundable fees for the two contracts. The sum is not refundable.
The Appellants are however awarded N200,000 (Two Hundred Thousand Naira) as general damages to assuage the loss incurred by the Appellants while making efforts to fulfil their own part of the aforesaid contracts.
The Appellants are entitled to costs assessed at N50,000 (Fifty Thousand Naira) against the Respondent.
IGNATIUS IGWE AGUBE, J.C.A.: I have been privileged to read the lead judgment of my learned brother before now. There is no doubt that the authorities are settled that whereas in this case the Plaintiffs/Appellants filed their Statement of Claim which was amended by leave of Court granted on the 22nd May, 2001 and the Respondent who was duly served did not file any defence, the Appellants who later filed a Motion pursuant to Order 27 Rule 4 of the Abia State High Court (Civil Procedure) Rules, 2001 and proved their case in default of Defence were entitled to judgment on minimal proof. In fact all that the Appellants were required to do in the face of default of defence was for them to file a Motion for judgment in accordance with Order 27 Rule 4 of the High Court Rules of Imo State.
The Court below in such circumstance ought to have entered judgment for the Appellants with or without proof since by the ordinary rules of pleadings, the averments of the Appellants in their Statement of Claim were to be taken as admitted as they stood unchallenged so long as they disclosed a cause of action. See E.N.D.C. v. Jack Asuk & Ors. (1963) 7 ENLR 179, Nzeribe v. Dave Engineering Co. Ltd. (1994) 9 SCNJ 161 and Broad Line Ent Ltd. v. Montery Maritine Com. (1995) 10 SCNJ 1 at 22 per Iguh, JSC.
In the case at hand, as rightly observed by my noble Lord, the Respondent did not deem it necessary to file a Statement of Defence in spite of its initial appearance in Court neither did it file a Motion for extension of time to so do until the Appellants completed the proof of their case and were not cross-examined in which case they (Respondents) had admitted the claim of the Appellants. Omoregbe V. Lawan; (1980) 3 – 4 S.C. 108 at 117 Per Idigbe, JSC and S.T.B, LH, V. Interdrill Nig. Ltd & Anon (2007) ALL FWLR (Pt 366) 756 at 770 – 771 paras. H – A., where this Court, Per Aderemi, JCA (as he then was); re-echoing the dicta of the Supreme Court in the cases of Mogaji v. Odofin (1978) 4 S.C. 91; Odulaja V. Haddad (1973) 11 S.C. 357 and Buraimoh V. Bamgbose (1989) 3 NWLR (Pt.109) 352 reasoned that:
“It is now very axiomatic that proof of issues in a civil case is on the balance of probabilities. Where there is nothing to put on the one side of the imaginary scale of justice, minimum evidence on the other side satisfies the requirement of proof even where strict proof such as proof of special damages is the matters.”
See further, Ajidahun V. Ajidahun (2000) 4 NWLR (Pt 654) 605 at 645 Per Galadima, JCA (as he was then) and Owosho V. Dada (1984) 7 S.C, 749 at 163 – 164 Per Aniagolu, JSC., ably cited by my Lord in the lead Judgment.
From the foregoing authorities, it is clear as rightly held by my noble Lord that the Respondent who did not proffer any defence was deemed to have admitted all the averments in the Appellants’ Statement of Claim since it failed either specifically or by implication to deny the said averments by way of Statement of Defence or lead evidence in rebuttal thereof. Accordingly, Issue A shall be resolved in favour of the Appellant.
As for Issue B, I am also in tandem with the reasoning and conclusion of my learned brother that parties are bound by the terms of their agreement and apart from the fact that the Respondent never raised the defence of frustration, the terms of the contract are clear and explicit particularly by Exhibit A clause 4 thereof and paragraph 9 of the Second Agreement that the Respondent ought to terminate the contract by notice in writing to the Appellants and that the Agreement remained binding on the parties unless and until duly terminated as provided in paragraph 15 of the said Agreement. No evidence was tendered by the Respondent to the effect that such notice was issued by the Respondent and the Court below with the greatest respect had no business descending into the arena and in so doing was definitely covered by the dust of the conflict when it played the hatchet man for the Respondent who was not interested in defending the claim against it.
I am therefore in complete agreement with my learned brother on the authorities of Amale V. Sokoto Local Government & Ors. (2012) 5 NWLR (Pt. 1292) 181 at 202 para. C; per Fabiyi, JSC; Agbiti V. Nigerian Navy (2011) 4 NWLR (Pt 1236) 175 at 220, Hambe V. Hueze (2011) 2 S.C. 26 at 39; Akintola V. Solano (1986) 2 NWLR (Pt. 24) 598, Victino Fixed Odds Ltd. V. Joseph Ojo & Ors. (2010) S.C. (Pt 1) (2010) 8 NWLR (Pt.1197) 486; that the learned trial Judge was wrong to have raised the issue of frustration suo motu without affording the learned counsel for the Appellants the opportunity to address him on the issue thereby occasioning the Appellants substantial miscarriage of justice and a breach of the Appellants’ right to fair hearing.
Moreover, there was no evidence of frustration of contract from the oral and documentary evidence adduced by the Appellants. In the circumstances, I shall also resolve Issue B in favour of the Appellant.
As for Issue C, I adopt the position taken by my Lord in the Lead Judgment and hold that the Appellants were entitled to the sum of N398,265.00 as per items (i) – (iv) (a)(b) and (c) of the particulars of special damages which they proved and the Respondent was deemed to have admitted as well as N200,000.00 (Two Hundred Thousand Naira) only as general damages for loss incurred in the course of fulfilment of their part of the bargain.
I abide by the order as to Costs as I also hold that this Appeal is meritorious and is accordingly allowed.
FREDERICK O. OHO, J.C.A.: I have had the opportunity of reading in draft the judgment just read by my learned Brother, Peter Olabisi Ige, JCA and I entirely agree with the conclusions reached therein. I have nothing more to add. I wilt also allow the Appeal and make the same orders made in the judgment.
Appearances
J.O. Emelike Esq holding Brief of K.C. Nwufo Esq.For Appellant
AND
Respondent’s Counsel absent.For Respondent
