SOCIETE COMMERCIALE DEL’OUEST AFRICAN NIGERIA PLC v. MRS GLADY’S A. OZOH & ORS
(2013)LCN/6407(CA)
In The Court of Appeal of Nigeria
On Friday, the 12th day of July, 2013
CA/E/352/2006
RATIO
WHETHER AN ISSUE FOR DETERMINATION MUST BE PREDICATED ON ONE OR MORE GROUNDS OF APPEAL
An issue for determination in an appeal must be based on one or more of the grounds of the appeal. If an issue is not based on any of the grounds of an appeal, it is incompetent and must be struck out. The grounds of appeal constitute the foundation of the appeal. Therefore all issues and arguments of such issues must derive from the grounds to be valid and competent for consideration. See OKPALA & ANOR v. IBEME & ORS (1989) NWLR (pt. 102) 208, LATUNDE & ANOR v. LAJINFIN (1989) NWLR (pt. 108) 177, IKEMSON v. STATE (1989) NWLR (pt. 110) 455 and AKINBINU v. OSENI & ANOR (1992) 1 NWLR (pt. 215) 97. PER EMMANUEL AKOMAYE AGIM, J.C.A
JUSTICES
MOJEED ADEKUNLE OWOADE Justice of The Court of Appeal of Nigeria
ISAIAH OLUFEMI AKEJU Justice of The Court of Appeal of Nigeria
EMMANUEL AKOMAYE AGIM Justice of The Court of Appeal of Nigeria
Between
SOCIETE COMMERCIALE DEL’OUEST AFRICAN NIG. PLC Appellant(s)
AND
1. MRS GLADY’S A. OZOH
2. ONYECHI L. OZOH
3. CHINEDU M. OZOH
(Suing as Executors and Administrators of Late Esel Uenuego Michael Ozoh, Late of Ogbeozalla Village, Onitsha) Respondent(s)
EMMANUEL AKOMAYE AGIM, J.C.A. (Delivering the leading Judgment): On the 22nd August 2005, the Anambra State High court Onitsha Judicial division, sitting at Otuocha per P.A.C. Obidigwe, J delivered judgment in suit No. 0/769/98 against the defendant (now appellant) in favour of the plaintiffs (now respondents) in the following terms –
1. Declaration that by subletting/subleasing parts of the demised premises known as No. 3 New Market Road Onitsha, without the consent of the plaintiffs and the Governor, the defendant was in breach of the terms of the lease agreement.
2. Declaration that the defendant was in breach of the said lease agreement for not keeping the premises/property in good and substantial repairs during the continuance of the lease.
3. There is no evidence that any further rents were paid after the 1988 rent was returned to the defendant through Exhibits H and I. There is also evidence that the defendants collected rents from the sub-tenants whom the defendant put in the premises without the consent of the plaintiffs. The plaintiffs are in the circumstances, entitled to account for all rents collected by the defendant from the sub-leases. I therefore order that the defendant account for all moneys received from Orient Bank Plc and Cown Men Ltd. As rents from 1988 till, 31st August, 1999, and that the amount so accounted for be paid to the plaintiffs.
4. N1,500,000.00 (One million, five hundred thousand naira) as general damages for breach of covenants.
5. I assess and fix costs at N15,000.00.
Dissatisfied with this judgment, the defendant commenced this appeal No. CA/E/352/2006 by filing a notice of appeal containing 3 grounds of appeal. The parties have filed, exchanged and adopted their respective briefs of argument. The appellant in its brief of argument raised issues for determination as follows –
Whether the Trial Judge was right in awarding the sum of N1.5m (One Million, five thousand Naira only) for breach of covenant as well as accounts for all rent collected, in view of:
(a) The fact that forfeiture had already taken place;
(b) The clear provisions of exhibit ‘C’ ‘the lease’ for remedy for breach of covenant.
(c) The general Law creating the relief and guiding the award of damages for breach of covenant against subletting.
2. Whether the Trial Judge proceeded on the right principles and properly evaluated the evidence adduced and submissions made before the court before entering judgment for the respondents.
The respondents in their own brief of argument also raised two issues for determination as follows –
1. Having regard to the breaches committed by the Defendant/Appellant, whether the Learned Trial Judge was not right to have awarded general damages in the sum of N1,5000,000.00, and whether the amount was excessive in the circumstance of the case.
2. Was the Learned Trial Judge correct to have ordered that the Defendant/Appellant render account to the Plaintiffs/Respondents for all the rents collected by it from the sub-tenants notwithstanding that an award of general damages had been made/granted.
The appellants first issue for determination covers the two issues raised by the respondents.
Appellant’s issue No. 2 does not appear to touch on or derive from any of the three grounds of appeal in the notice of appeal. I cannot find any relationship between any of the grounds and this issue. The issue is obviously not distilled from any of the grounds in the notice of appeal.
An issue for determination in an appeal must be based on one or more of the grounds of the appeal. If an issue is not based on any of the grounds of an appeal, it is incompetent and must be struck out. The grounds of appeal constitute the foundation of the appeal. Therefore all issues and arguments of such issues must derive from the grounds to be valid and competent for consideration. See OKPALA & ANOR v. IBEME & ORS (1989) NWLR (pt. 102) 208, LATUNDE & ANOR v. LAJINFIN (1989) NWLR (pt. 108) 177, IKEMSON v. STATE (1989) NWLR (pt. 110) 455 and AKINBINU v. OSENI & ANOR (1992) 1 NWLR (pt. 215) 97. The appellants issue No. 2 is therefore incompetent as it is not based on any of the grounds of this appeal. It is accordingly struck out. It now follows from this striking out of appellant’s issue No. 2, that only appellant’s issue No. 1 is now remaining for determination. As I had stated herein, the said issue covers the two issues for determination by the respondents.
I adopt the appellants remaining issue as the issue for determination in this appeal. I will now proceed to determine this issue.
The arguments made by learned counsel for the appellant on the basis of this issue are in substance as follows –
1. Where a covenant against assignment or under letting, with a proviso for re-entry on breach of covenant, is breached, the lessor can either re-enter for the forfeiture or sue for damages for the breach.”
2. Since forfeiture had taken place, “the relief clearly open to the plaintiffs/Respondents at this stage is damages as a cost of reinstatement and the damages must be measured by the loss naturally flowing from the subletting.
3. “The general damages of N1.5m (One Million, five Hundred Thousand Naira only) awarded to the plaintiffs/Respondents, side by side with the account of all rents collected by the Defendant/Appellant is clearly a grievous error in law because, it:
a) Was not awarded strictly for reinstatement; and
b) Was not measured by the loss naturally flowing from the subletting.
At best the order for account could be the appropriate award in view of (b) above.
4. Award of general damages cannot exist side by side with the order for account. The proper thing to do is to order one as an alternative to the other.
5. “A close perusal of exhibit ‘C’ (the lease agreement) will show that the order for account is not stated as a remedy for the breach of the covenant not to sublet. It is therefore, we most humbly submit, an error in law to order for a remedy that is not expressly stated in the lease agreement and which is also not known to law.
6. Even though there is evidence that the appellant did sub-let the suit property to tenants, there is no evidence that it collected rent from any of the subtenants. The trial court was wrong to conclude that appellant collected rents from the said sub-tenants.”
Learned counsel for the respondents argued in reply that the trial court was right to have awarded general damages and ordered an account for the rents paid to the appellant by the tenants, that general damages are implied by the law in every violation of a legal right or breach of contract, that it is awarded for the loss which flows naturally from the appellant’s act, its quantum need not be pleaded or proved as it is generally presumed in law, and that the award is not excessive having regard to the aggravated nature of the breaches committed by the appellant. Learned Counsel further submitted that exhibit P shows the rent paid by Orient Bank Ltd. (one of the subtenants) to the appellant and that the fact of subletting presupposes that it is for rent, as the property cannot be subletted for nothing. Learned Counsel finally submitted that the lessors rights and remedies to which his right of reentry is subject under exhibit C are wide and include lessors right to an account for rents collected by a tenant from sub-tenants in breach of the covenant not to sub let the lease property.
It is glaring from the argument of Learned Counsel for the appellant that the appellant conceded that it breached the covenant against subletting in exhibit C and that forfeiture had already taken place. The contentions that clearly emerge from the arguments of Learned Counsel for the appellant are as follows –
1. That the award of N1.5million as general damages together with an order that the appellant account for the rents it collected from subtenants were made in error of law because, the damages was not awarded for cost of reinstatement of the property and was not measured in terms of the loss naturally flowing from the subletting.
2. Since the award of damages was not measured by the loss naturally flowing from the subletting, “at best the order for account could be the appropriate award.
3. The award of damages for breach of covenant against subletting cannot be made together with an order for account for rents collected
4. The remedy for account is not provided for in exhibit C (the lease agreement) and therefore is not available to the respondents.
5. The conclusion of the trial court that there is evidence of collection of rent from sub tenants is wrong.
Let me start with the first contention. It is important here to recall that the trial court held that “From the totally of the evidence before the court, the defendant committed breaches of the terms of exhibit C:
(a) By subletting the premises without the consent of the plaintiffs and the governor;
(b) By failing to carry out repairs of the premises during the continuance of the lease;
(c) By failing to deliver up possession of the premises at the expiration of the lease and
(d) By failing to pay rent as and when due.”
After holding that the respondent breached the said four covenants, the trial court considered the basis for the award of damages for the said breaches thus –
“Having held that the defendant committed breaches of the terms of the lease, I go on to consider the issue of the quantum of damages. In respect of the 4th issue of whether the defendant had carried out any renovation work as would discharge or absolve it of paying damages for the breach, I once again refer to the evidence before this court in respect of the alleged repairs. The plaintiffs denied the alleged repairs by the defendant and said that the repairs and renovation were carried out by the new tenants after the defendant vacated. The evidence of the defendant (D.W.1) about the repairs and renovation is contradictory and cannot be relied. In his evidence in chief the D.W.1 told the court that the 3rd plaintiff Mr. Chiedu Ozoh, represented the plaintiffs and was present during the repair. But under cross examination the same D.W.1 admitted that Chiedu did not witness the repairs. That none of the plaintiffs witnessed the repairs. Also he told the court, under cross examination that he was aware of overtures made for payment for the repairs which the plaintiffs rejected. If the defendant had effected any repairs there would be no need for them to make overtures for payment for the repairs. I reject the evidence of the defendant about the repairs.” (my underlining)
It is clear from the above judgment that if the trial court had come to the conclusion that the appellant did repair the lease property, it would not have awarded the said general damages of N1.5million. The state of disrepair of the lease property following the breach of the appellant’s covenant to maintain the lease property in good and substantial repair is a loss naturally flowing from the said breach. Although in making the award of N1.5million, the trial court stated that it was for the breach of covenants, the above part of the judgment show clearly that the award was for the repair of the lease property. In the light of the above part of the judgment of the trial court reproduced herein, I do not agree with the argument of learned counsel for the appellant that the award was not strictly for the reinstatement of the lease property and was not measured by the loss naturally flowing from the subletting. Since this was the only ground for the appellant’s complain against the award of general damages, it follows from the failure of this ground that there is no basis for the complain against the award. In addition to the failure of this ground, the general law on the award of general damages, is correctly stated and applied by the trial court. Learned Counsel for the respondent has equally correctly restated the law. General damages is a remedy provided by law for the loss it presumes arises from every breach of a legal right. The law presumes that in the ordinary and usual course of things or human affairs a loss is likely to result from the breach of a legal right. The quantum of the award depends on the peculiar circumstance of each case. Whatever the case, the amount must be reasonable and in accord with common sense and therefore reflect the peculiarity of the facts of the case. The discretion of the trial court in making such award must be exercised judicially and judiciously.It is noteworthy that this appeal is not against the quantum of the award Learned Counsel for the appellant has not argued that the amount is too high or that the award proceeded on the basis of some wrong principle or that the trial court was wrong to have based the award on a consideration of whether the appellant repaired the lease property. Learned counsel for the appellant has rightly restated the law that “the only circumstance justifying an interference with the award of general damages made by the trial court by an appellate court is when the award is manifestly too high or manifestly too little so as to raise the inference that it was an erroneous assessment of the damages suffered or where the trial judge had made the award relying on a wrong principle.” For this restatement he relied on the Supreme Court decision in S.P.D.C NIG. LTD. v. TIEBO (2005) 32 NRN 8.
I will now consider the argument that the award of general damages cannot be claimed for or granted together with an order for account. Learned counsel for the appellant has not stated any legal authority for this proposition. It is clear from the judgment of the trial court that the two remedies were meant to address different injuries. The award of general damages was meant to repair the lease property. The order to account was for rents collected by the appellant from subtenants. The appellant did what under its contract with the respondents it had no right to do and was prohibited from doing. He acted in breach of clause 2(3) of the lease agreement. The rents he collected from the subtenants are proceeds resulting from his deliberate breach of the lease agreement. The order that he accounts for the rents and pay same over to the respondents is meant to not only protect the contractual and proprietary right of the respondents but also to prevent the unjust situation of allowing the appellant keep the benefit of his illegal act to the detriment of the respondents. An order for an account operates to ensure that such transaction is investigated to ascertain the amount due from the appellant to the respondents.
Let me now consider the argument that the Order of account should not have been made because account is not a remedy contemplated by the parties in the lease agreement in that it is not stipulated therein as remedy for breach of the covenant against subletting. Firstly, it is not correct that the remedy of account was not contemplated by the parties under the lease agreement. It is clear from the expressed terms of the agreement that the parties acknowledged that the lessor has other rights and remedies for the breach of any of the covenants of the agreements in addition to the right of re-entry. The agreement did not limit or exclude the right the lessor can exercise and the remedies he is entitled to for the breach of any covenant of the agreement. This is clear from the provisions of clause 3(1) and (2) of the agreement, particularly sub clause (1) which reads thus – “If the rent hereby reserved or any part thereof shall be in arrear for one month or if there shall be a breach or non-observance of any of the covenants aforesaid on the part of the lessee, the lessor by herself or by the District officer of the District on her behalf may re-enter upon the said premises and the term hereby created shall forthwith cease and determine but subject to the rights and remedies of the lessor for or in respect of any rent in arrear or any breach or non-observance of any of the covenants on the part of the lessee to be performed or observed.” Therefore the argument that the agreement did not stipulate account as a remedy for the breach of the covenant against sub letting is not correct. The agreement acknowledged the lessors general rights and remedies and stipulated that the lessors right of re-entry is subject to and therefore without prejudice to his other rights and remedies for breach of any of the covenants in the agreement. The clear implication of this argument of learned counsel for the appellant is that unless a right or remedy for the breach of a contract is expressly provided for in a contract, it will not be available to either party to the contract. This is a very strange proposition. The right to legal remedies for breach of contract or any other legal right exists and is exercisable by operation of law. If a party who alleges that his contractual or other legal right is breached, asks for a remedy in accordance with the due process of law, if the facts and the law support the grant of such remedy it should be granted. The remedy need not be stipulated in the agreement before a party can be entitled to it. A party’s entitlement to a remedy results from the breach of his or her express or implied contractual right.
The argument of learned counsel for the appellant that account is a remedy not known to law is not correct. It is elementary that account is a remedy known to law. It is usually ordered in support of a legal or equitable right especially where an express or implied trust or agency exists. So an order may lie against a person to account for proceeds of money he received from dealing in the property of another without the knowledge and or consent of the later and in some cases to account for money the owner of the property would have received but for the defendants negligence or willful default. See ALAO v. AJANI (1989)4 NWLR (pt. 113) 1, the English case of White v. City of London Brewery Co. (1989)42 Ch-D. 237 and the unreported decision of this court in (delivered on in appeal no where a party was order to account for rents he collected from tenants as executor de son tort.
With respect to the argument that there was no evidence that appellant collected rents from sub tenants, I agree with the submission of Learned counsel for the respondents that exhibit P shows that the appellant subletted part of the lease property to Orient Bank Limited for the rent of N31,270.00 from 1-10-1987. There is no evidence of the rent received by the appellant for sub letting part of the lease property to Crown Men Ltd. However, it is not in dispute that the appellant did sublet the place to Crown men Ltd. The absence of evidence of the rent paid to it therefore means that the rent received cannot be ascertained. This makes the need for an order for an account more compelling. An order for account primarily lies to ascertain the exact amount received and cause same to be paid over to the claimant. The absence of evidence of the rents received instead of defeating the claim for an account provides a very good reason for the success of the claim there was no evidence of the amount collected as rents. In NWINYI & ORS v. OKONKWO (Appeal NO CA/E/189/2008 decided on 19-4-2013), this court ordered the executor de son tort to account for the exact amount it has received as rent and pay over to the claimant as there was no evidence of the amount collected as rent.
In the light of the foregoing, I resolve the single issue for determination in favour of the respondents.
On the whole this appeal fails and hereby dismissed. The judgment of the trial court is upheld. The appellant shall pay cost of N50,000 to the respondents.
MOJEED ADEKUNLE OWOADE, J.C.A.: I agree.
ISAIAH OLUFEMI AKEJU, J.C.A.: I had the opportunity of reading before the judgment of my learned brother Emmanuel Akomaye Agim, JCA just delivered. I agree with the reasoning and conclusion therein and I dismiss the appeal, with costs as awarded by my learned brother.
Appearances
O. B. Erinne Esq.For Appellant
AND
Mike Uchenna Ikem Esq. and
Miss Elizabeth IkemFor Respondent
