UBA PLC v. GEMEX INTL LTD
(2020)LCN/15614(CA)
In the Court of Appeal
(ENUGU JUDICIAL DIVISION)
On Friday, September 18, 2020
CA/E/115/2018
Before Our Lordships:
Misitura Omodere Bolaji-Yusuff Justice of the Court of Appeal
Joseph Olubunmi Kayode Oyewole Justice of the Court of Appeal
Abubakar Sadiq Umar Justice of the Court of Appeal
Between
UNITED BANK FOR AFRICA PLC APPELANT(S)
And
GEMEX INTERNATIONAL LIMITED RESPONDENT(S)
RATIO:
THE NATURE OF A CASE MUST BE CLEAR AND DISCLOSED IN THE PLEADINGS
The law is trite that where a case is brought before a superior Court of record for adjudication by a writ of summons, the nature of the case being presented by a party and defence thereto must be clearly and precisely disclosed in the pleadings. The Court must consider the totality of the pleadings filed by both sides to properly understand the issues joined in the pleadings. See NWOKOROBIA V. NWOGU & ORS. (2009) LPELR-2127(SC) 17 (D-F), FCMB V. ATS ABATCHA NIG.LTD. & ORS (2017) LPELR-43452(SC) AT 32 (A-F), ONYIORAH V. ONYIORAH (2019) 15 NWLR (PT. 1695) 227 AT 243 (B-C) . MISITURA OMODERE BOLAJI-YUSUF,J.C.A
THE CONSENSUS ADIDEM OF A CONTRACT OR AGREEMENT
In BEST NIG. LTD. V. BLACKWOOD HODGE NIG. LTD. (2011) LPELR-776(SC) AT 39-40 (F-C) the Supreme Court per Adekeye JSC held that:
“It is trite law that before any contract or agreement can be said to have come into existence, in law, there must be an unmistaken and precise offer and an unconditional acceptance of the terms mutually agreed upon by the parties thereto. In other words, the parties to the agreement must be in consensus ad idem as regards the terms and conditions freely and voluntarily agreed upon by them.’ MISITURA OMODERE BOLAJI-YUSUF,J.C.A
IT IS THE PRIMARY DUTY OF THE TRIAL COURT FOR THE EVALUATION AND ASCRIPTION OF PROBATIVE VALUE OF THE EVIDENCE
The law is settled that evaluation and ascription of probative value to the evidence led is the primary duty of the trial Court which an appellate cannot interfere with unless it is shown that the trial Court failed to perform its duty or that the finding made by the Court is perverse. What constitutes a perverse decision has been stated in a plethora of cases. See ODOM & ORS. V. PDP & ORS. (2015) LPELR-24351(SC) AT 39 (A-D) where the Supreme per MUHAMMAD, J.S.C. stated instances where the decision of Court would be regarded as perverse as follows: “A finding of fact or decision is said to be perverse when it runs counter to pleadings and evidence on record or where the Court which findings or decision are/is being reviewed is shown to have taken into account irrelevant matters or shut its eyes to the obvious and by its very nature the finding or decision has occasioned a miscarriage of Justice. A decision being reviewed may as well be found to be perverse on account of the trial Court’s wrongful application of the law to correctly ascertained facts. See Yaro V. Arewa Construction Ltd & Ors (2007) 16 NWLR (Pt.1063) 333 at 374 and Olaniyan & ors v. Fatoki (2013) LPELR – 20936 (SC).” MISITURA OMODERE BOLAJI-YUSUF,J.C.A
THE PARTIES AND THE COURT ARE BOUND BY THE PLEADINGS
The law is settled that both the parties and the Court are bound by the pleadings and the Court must confine itself to the issues joined by the parties in their pleadings. The Court is forbidden from making a case different from the case set up by a party in his pleadings or granting a relief not asked for by a party. See FAGBENRO V. AROBADI & ORS (2006) LPELR-1227 (SC) AT 10 (A-E), OMOKUWAJO V. FRN (2013) LPELR-20184(SC) AT 30-31(C-A), KAYILI V. YILBUK & ORS. (2015)LPELR-24323(SC) AT 52 (A-P) . MISITURA OMODERE BOLAJI-YUSUF ,J.C.A
THE COURT IS TO DECIDE DISPUTES ACCORDING TO ITS EVIDENCE
In B.F.I. GROUP CORPORATION V. B.P.E. (2012) LPELR-9339 (S) AT 53 -54 (B-C) the Supreme Court per ARIWOOLA, J.S.C. held that:
“It is noteworthy that this Court has in several cases stated that the Court is to determine and decide disputes brought before it in accordance with the evidence, both oral and documentary only, in particular, as agreed by the parties. The Court is not to draft or make out a different agreement for parties. It will amount to injustice, or miscarriage of justice, to say the least. In Baker Marine (Nig) Ltd v. Chevron (Nig.) Ltd. (2006) 8-9 SCM 103 at…; (2006) 13 NWLR (pt.997) 276 at 287-288, this Court, per Ogbuagu, JSC opined thus: “It has been stated and restated in a number of decided authorities that in the interpretation of contracts or documents, the basic principle of law, is that, it is not the duty of any Court or Tribunal to make contract for parties. See; Fakorede & Ors. v. Attorney General of Western State (1972) 1 All NLR 178 at 189. MISITURA OMODERE BOLAJI-YUSUF,J.C.A
MISITURA OMODERE BOLAJI-YUSUFF, J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of the High Court of Enugu State delivered in suit no. E/568/2005 on 5/11/2013. The respondent as the plaintiff instituted the suit and claimed the following reliefs in the further amended statement of claim:
a. “A declaration that the plaintiff is entitled to damages arising from the gross negligent acts of the defendant to the plaintiff to the effect that it will fund the plaintiff’s Awka Residential Estate project aforesaid.
b. An order for the defendant to pay the plaintiff the sum of N3,327,183,000.00 being damages (special and general) arising from the negligent acts of the defendant which would have been avoided if the defendant had made its inability to perform its part of the terms reached.(sic)
c. 25% percent interest on the sum of N50,000,000.00 (Fifty Million Naira) being the amount already invested on the estate by the plaintiff.
d. 10% percent interest per annum on the judgment sum from the date of the judgment until the judgment debt is liquidated.”
The respondent’s case as pleaded in paragraphs 4, 6, 7, 18 of the Further Amended Statement of Claim is that the appellant and the respondent had series of discussions which culminated in an agreement by the appellant to grant a 50 Million Naira project finance loan to the respondent to facilitate the execution of its housing project in Awka, Anambra State. The respondent satisfied all the terms and conditions stipulated by the appellant but the appellant failed to honour its own contractual obligation which failure made the respondent to suffer losses and damages.
On the part of the appellant, it admitted that there was a business discussion for a grant of 50 Million Naira facility to enable the respondent continue its building project but denied that there was a contract because the respondent did not fulfill the conditions given by the appellant for the grant of the facility. The appellant stated both in its defence and at the trial that the discussion was still ongoing and had not been consummated when the respondent took out this suit. It denied that it persuaded the respondent to enter into the building project or that it lured the respondent into spending money on the project in the first instance. The parties called one witness each in proof and defence of the case.
In its considered judgment delivered by R. O. Odugu J, the Court below entered judgment in favour of the respondent as follows:
“From the nature of the claim by the plaintiff and the weight of evidence led by the parties, I find the defendant liable to the plaintiff’s claim as follows:
a. This Court makes a declaration that the plaintiff is entitled to damages for the consequential losses arising from the unfair business practices of the defendant through misrepresentation, false assurances and inducement of the plaintiff to the effect that it will fund the plaintiff’s Awka Residential Estate project.
b. The defendant is found liable to the plaintiff’s claim of special damages in the sum of N1,148,495:44 (One Million, One Hundred and Forty Eight Thousand, Four Hundred and Ninety Five Naira, Forty Four Kobo) only.
c. The plaintiff is also adjudged to be entitled to recover its general damages assessed to be N10,000,000.00 (Ten Million Naira) against the defendant in favour of the plaintiff.
d. The defendant is liable to pay interest on the judgment debt at the rate of 5% from the date of the judgment until liquidation of the judgment debt.
The claims of 25% interest on the N50,000,000.00 and the other listed terms of special damages which are not supported by evidence are hereby dismissed. But the plaintiff is also entitled to the cost of his action which is also assessed to be N50,000.000 (Fifty Thousand Naira Only).”
Being dissatisfied with the judgment, the appellant raised seven grounds of appeal via a notice of appeal filed on 24/1/14. The grounds of appeal without their particulars are as follows:
GROUND ONE – ERROR IN LAW
“The learned trial judge erred in law when he held thus:
From the totality of the evidence before the Court, I find as a fact that there was an agreement between the plaintiff and the defendant for the granting of a loan of N50,000,000 in form of project finance.
GROUND TWO – ERROR IN LAW
The trial judge erred in law when he held as follows ”I have come to a conclusion that there was a valid contract implied by law and made between the plaintiff and the defendant for the granting of loan of N50,000,000.00.
GROUND THREE- ERROR IN LAW
The learned trial judge erred in law when after holding as follows:
“In this case, the plaintiff has not been able to satisfy this Court that there is a duty of care recognised by law which the defendant has breached in the loan agreement under the duty to perform its own part of the contractual obligation. It seems to me that the argument that the damages arose from a breach of a duty of care is misconceived.” Still found the defendant liable in damages under the said arrangement.
GROUND FOUR – ERROR IN LAW
The learned trial judge erred in law when he held that the plaintiff had not only performed the pre-contract conditions but had gone ahead to show willingness to perform any other one outstanding.
GROUND FIVE- ERROR IN LAW
The learned trial judge erred in law when he held that the plaintiff is a victim of unfair business practices which occasioned loss and damages to the plaintiff.
GROUND SIX – ERROR IN LAW
The learned trial judge erred in law when without proof he awarded the sum of N1,148,495.00 as special damages in favour of the respondent the said sum being charges for COT, VAT, fee on facility, interest charges and request charges.
GROUND SEVEN- ERROR IN LAW
The learned trial judge erred in law when he stated that the defendant took undue advantage of the fiduciary relationship between the parties and induced the plaintiff to satisfy the terms and conditions among others for the granting of the loan facility of N50,000,000.00 without fulfilling its own part of the contract.”
The appellant’s brief was filed on 29/10/18. The respondent’s brief was filed on 12/2/2019. Both briefs were deemed as properly filed and served on 27/6/20. Counsel adopted their respective briefs on the same day.
The appellant raised the following issues for determination:
1. “Whether the trial Court was right in holding that a contract for project financing was consummated for a loan facility of N50 Million by the appellant and that the appellant breached the agreement and took advantage of its fiduciary relationship without fulfilling its own part between the parties and induced the respondent to satisfy the terms of the offer for the facility without fulfilling its own part.
(Ground 1, 2, 3, 4 and 7).
2. Whether the trial Court was right in making a case for the respondent in its judgment different from the case made out in the Further Amended Statement of Claim and evidence at the trial. (Ground 5).
3. Whether the trial Court was right in awarding the respondent the sum of N1,148,495,00 as special damages without proof of such claim.”
The respondent on its part raised the following sole issue for determination:
“Whether in the light of the evidence adduced at the trial, the respondent was entitled in law, to the award of the special and general damages made in its favour by the trial Court.”
I have considered the judgment of the Court below, the grounds of appeal and the issues raised by counsel on both sides, I am of the firm view that the issues thrown up for determination in this appeal are as follows:
1. Whether the Court below erred in law when it held that there was a valid contract implied by law between the appellant and the respondent for a grant of N50,000,000,00 (Fifty Million Naira) loan.
2. Whether the Court below erred in law when it entered judgment and awarded damages in favour of the respondent.
On issue 1, the appellant’s counsel submitted that the findings of the Court below that there was an agreement between the parties for a grant of N50,000,000:00 loan and that the respondent performed its own side of the contract are not borne out of the evidence on record and the wrong findings led to a miscarriage of justice. He further submitted that until an offer is unequivocally accepted, no binding contract has been made. He referred to BIOKU INV. PPTY LTD. V. LIGHT MACHINE INDUSTRY LTD. (1986) 5 NWLR (PT. 39). P.T.I V. UWAMU (2001) 5 NWLR (PT.705) 112. It is further submitted that the Court was wrong when it held that Exhibits 2, 16 and 27 did not introduce new issues or counter offer requiring the acceptance and fulfillment of the conditions stated therein before a valid acceptance of the offer can be said to have been made. Counsel argued that the finding of the Court below that there was an implied contract connotes that there was no agreement by the parties by consent and an inference of implied contract was not the case of the parties.
In response, the respondent’s counsel submitted that on the evidence before the Court, the respondent proved that there was a contract between it and the appellant and that the respondent fulfilled its own part of the contract but the appellant did not.
RESOLUTION
The law is trite that where a case is brought before a superior Court of record for adjudication by a writ of summons, the nature of the case being presented by a party and defence thereto must be clearly and precisely disclosed in the pleadings. The Court must consider the totality of the pleadings filed by both sides to properly understand the issues joined in the pleadings. See NWOKOROBIA V. NWOGU & ORS. (2009) LPELR-2127(SC) 17 (D-F), FCMB V. ATS ABATCHA NIG.LTD. & ORS (2017) LPELR-43452(SC) AT 32 (A-F), ONYIORAH V. ONYIORAH (2019) 15 NWLR (PT. 1695) 227 AT 243 (B-C). In the instant case, the gist of respondent’s case can be garnered from the averments in paragraphs 4,6,7,13,15 of the Further Amended Statement of Claim where the respondent averred that:
4. “Sometimes in January 2001, the plaintiff Company held series of discussions with the representative of the defendant at the business office of the bank in Enugu concerning the financing of the construction of residential estate comprising of 25 modern duplexes to be erected at Awka in Anambra State. During the discussions, the plaintiff estimated the project to cost N125M inclusive of the land and asked for a part financial assistance from the defendant to a tune of N50 Million to facilitate the execution of the housing project within a certain period, that is 12 months. The estimated cost of the project which the plaintiff sought from the defendant was N100,000,000 (One Hundred Million). By a letter dated January, 20th 2001, the defendant gave the plaintiff hints on its willingness and the extent it would finance the estate development in Anambra State.
6. As a result of the assurance made to the plaintiff by representatives of the defendant that they would advance to the plaintiff a loan of N50 Million Naira with interest to assist the plaintiff in completing the housing estate project at Awka, the plaintiff was then induced to perform the following acts as stated in the letters of January, 2001 namely and (sic) 30th November, 2001:
i. The plaintiff to purchase a piece or parcel of land at Awka for the same purpose of building the 25 duplexes estate project to make the dream a reality which the plaintiff did.
ii. The plaintiff to invest over Fifty Million Naira on the said housing estate. The plaintiff was deluded to believe that the defendant was seriously ready to invest its counterpart funding of N50 Million. The plaintiff paid into defendant the sum of N60,000,000.00 (Sixty Million Naira).
iii. The plaintiff was asked by the defendant to raise a monthly disbursement of N4.8 Million (on behalf of the plaintiff) as a guarantee from African International Bank in favour of the defendant. The plaintiff paid as requested via African International Bank Limited, Enugu cheque No. 838/2001 for N4.8m.
iv. The plaintiff to deposit with defendant its title deeds in respect of the land at Awka where the housing project is being constructed.
v. The plaintiff’s sub contractors should open accounts with the defendant. The list of the sub contractors who opened the accounts will be relied upon at the hearing.
LIST OF PARTICULARS OF CONTRATORS WHO OPENED ACCOUNT IN THE BANK:
There were 25 contractors who were awarded contract for the erection of the 25 duplexes and each received the sum of N2,000,000.00 from the plaintiff as payment through the defendant bank. The names of the contractors are as follows:
(1) Coinco Ltd (2) Hills Design Ventures (Nig) (3) IK Onyebuchi Finno Ltd (4) Cen Marble Ltd. (5) Ekwy & Associates Ltd (6) Chico Int’l Company (7) Mathematica Nig. Ltd (8) Wed Nig Ltd (9) Gacet Construction Comp. Nig. Ltd (10) Ecam & Co Ltd (11) Bin Engineering Services Ltd (12) Tech dot Ltd (13) Prince Charley & Sons Ent. (14) Bon Bon Ltd (15) Rochyn Int’l Ltd (16) Zilogtech Ltd (17) Manikson Nig Ltd (18) Danstacher Turnkey for Omin (19) El Tonek Nig. Lit (20) Herouso Nig Ltd (21) SEF Consultant (22) Myjem Int’l Ltd (23)Engr. J.C Nwankwo (24) NWeke John Kejo Ltd (25) Engr Ozoemenam Ezeilo.
A total sum of N50,000,000.00 (Fifty Million Naira) was collected by the contractors from the bank paid in by the plaintiff.
vi. The defendant benefited immensely by charging the contractors COT and other charges. Some of the contractors still maintain accounts in the defendant bank. The statement of account as reported by ledger form 01-03-2001 to 31-10-2001 supplied to the plaintiff by the defendant will be relied upon at the hearing of this case. Each contractor was paid N2,000,000.00 through the defendant as evident from 14-05-2001 on the statement of account 18-05-2001 and 22-05-2001.
7. The plaintiff satisfied the terms and conditions required of it by the defendant but the defendant failed to honour its own contractual obligations toward the plaintiff when the defendant delayed informing the plaintiff of its inability to grant the loan making the plaintiff to suffer damages and losses which would have been avoided.
13. Following subsequent discussion held between the representatives of the plaintiff and the defendant, some additional agreements were reached by both parties concerning the terms of participation of the defendant bank in the housing project.
15. The defendant did not write to the plaintiff to say that the plaintiff has not complied with the above requirements. Also, the defendant has not returned any of the plaintiff’s documents forwarded to the defendant as to give the plaintiff an idea of their inability to continue the business and to enable the plaintiff seek to obtain loan from another source since the relevant documents submitted to the defendant are still in the custody of the defendant.”
In EAGLE SUPER PACK NIG. LTD. V. A.C.B. (2006) LPELR-980 (SC) AT 27-28 (G-B), the Supreme Court held that “…where a plaintiff who brings an action in tort is driven to rely on a contract to sustain his suit, the action must be seen as an action in contract.” In the instant case, the respondent’s claim is based on the alleged agreement of the appellant to grant a loan of 50 Million Naira to the respondent and breach of same. The action is one in contract. Therefore, the respondent had the onus to lead cogent and credible evidence to establish the existence of a valid contract and breach of same by the appellant. The evidence must establish all the elements of a valid contract as laid down by a long line of cases which are a definite offer, unqualified acceptance and consideration. See OMEGA BANK (NIG) PLC V. O.B.C. LTD. (2005) LPELR-2636(SC) AT 40 (D-E), ABBA V. S.P.D.C.NIG.LTD (2013) LPELR-20338(SC) AT 32-33 (G-D), DANGOTE GEN. TEXTILE PRODUCT LTD. HASCON ASSOCIATES NIG. LTD & ANOR (2013) LPELR-20665 (SC) AT 24 (D). In BEST NIG. LTD. V. BLACKWOOD HODGE NIG. LTD. (2011) LPELR-776(SC) AT 39-40 (F-C) the Supreme Court per Adekeye JSC held that:
“It is trite law that before any contract or agreement can be said to have come into existence, in law, there must be an unmistaken and precise offer and an unconditional acceptance of the terms mutually agreed upon by the parties thereto. In other words, the parties to the agreement must be in consensus ad idem as regards the terms and conditions freely and voluntarily agreed upon by them.’’
In BROSSETTE MANUFACTURING NIG.LTD V.M/S OLA ILEMOBOLA LTD. & ORS (2007)LPELR-809 (SC) AT 35 (E-G), the Supreme Court Per OGBUAGU, J.S.C. held that the agreement must be complete leaving no ambiguity as to its purport, the identification of the parties to the agreement, the commencement and the duration of the agreement.
In determining whether all the elements of a valid contract have been established, the Court must look at the pleadings and the entire evidence led by both parties. Where the transaction or the contract is reduced into writing, the Court must look into the document to discover whether there was a definite offer and an unqualified acceptance and the consideration for the contract and whether the parties were ad idem on the contract. Where a contract involves several documents, all the documents including letters relating to the contract and the conduct of the parties must be considered together to arrive at a just decision. See C.B.N. v. IGWILLO (2007) LPELR-835(SC) AT 39 (B-D).
The Court below considered the evidence of PW1 and DW1, Exhibits 2, 16 and 17 and came to the conclusion that there was a valid contract implied by law between the parties. Exhibit 2 is the first letter written by the appellant to the respondent. Below is the content of Exhibit 2:
“January 20, 2011
The Chairmen/Chief Executive
Gemex International Ltd
Enugu.
Sir,
RE: FINANCING OF ESTATE DEVELOPMENT ANAMBRA STATE
The above subject refers.
Following is our bank’s position on the discussion held with you over this subject on January 19th, 2001.
1. The payback period for the project should be adjusted downwards to 30-36 months in lieu of the life of the present regime in Anambra State.
2. The performance bond to be provided by your company should be issued by a bank of repute rather than an insurance company.
3. The agreement between the interested parties in the project should incorporate the total transfer of title to the estates to Standard Trust Bank LTD pending the total liquidation of the bank’s total exposure to the State on this project.
4. The State entitling Standard Trust Bank Ltd should issue an irrevocable mandate to a monthly deduction at source sufficient to liquidate total out standings on the facility on/or before the expiration of the life of the facility.
5. In the event that a consortium of financial institutions is involved Standard Trust Bank Ltd will participate as the Lead Bank.
6. The interest rate prescribed should not be less than 2% of the Bank’s prime lending rate.
We look toward a fruitful business relationship with you.
Yours Faithfully
FOR: STANDARD TRUST BANK LTD
CHIEFO EJIOFOBIRI VINCENT ANYANWU
RELATIONSHIP MANAGER BUSINESS MANAGER”
Below is the content of Exhibit 16:
“30th November 2001,
The Managing Director
Gemex International Ltd,
10 Umunocha Street,
Independence Layout,
Enugu.
ATTENTION: Mr Emeka Nwandu
Dear Sir,
REQUEST FOR N50,000,000.00 TERM LOAN
We write to inform that we have reviewed your application for the above mentioned credit request and hereby request that you forward to us the under listed information and documents to enable us proceed with your request:
1. Unconditional guarantee executed by African International Bank to honour the irrevocable standing payment order for the stipulated length of time.
2. Confirmation on the current status of the project with regards to the following:
a. State of completion.
b. Amount already consumed in the project.
c. Full amount required to complete the project.
d. Expected completion time.
Kindly avail us these documents to enable us continue processing your credit request.
Once more we reiterate our commitment to assist you in all your endeavours.
Yours Faithfully,
For: STANDARD TRUST BANK LIMITED
COLLINS IGWE PRINCESS NGOZI NNAEDOZIE
GROUP HEAD, ENUGU REGIONAL DIRECTOR, SOUTH EAST” Exhibit 17 reads:
“December 3, 2001
The MD/CEO,
Gemex International Limited,
10 Umunocha Street,
Independence Layout,
Enugu.
ATTENTION: Mr. Emeka Nwandu
Dear Sir
GUARANTEE AND INDEMNITY IN FAVOUR OF GEMEX INTERNATIONAL LIMITED
Kindly indicate your companies (sic) willingness to guarantee a monthly irrevocable standing order from African International Bank to the tune of N4.8M (Four Million Eight Hundred Thousand Naira Only) in favour of Standard Trust Bank limited for 12 months effective December 2001.
Please note that in consideration of our making, issuing or extending or continuing to make, issue or extend one or more overdrafts, loans, letters of credit or other banking facilities or other financial services and in the event of a default by African International bank limited that you hereby indemnify the bank and agree to pay the monthly deductions yourself.
Kindly accept this condition by signing and sealing the document hereunder.
Yours Faithfully,
STANDARD TRUST BANK LIMITED
OLISA NWAKOBY COLLINS IGWE
Consumer banking Group Grouphead, Enugu.” The contents of the above documents do not in any way constitute a firm offer to grant a loan to the respondent. Exhibit 16 made it clear that the request for 50 Million naira term loan was still been processed. In paragraphs 6, 7 and 10 of DW1’s amended statement on oath, he stated that:
6. “The defendant did not at any time give assurance to the plaintiff that it would advance a loan of N50 Million to the plaintiff for the said project. The N50 Million was the plaintiff’s request which had not been accepted by the defendant in view of the conditions set down by the defendant which had not been fully met by the plaintiff.
7. The defendant did not induce the plaintiff to enter into any contract for a housing estate. It was the brain child of the plaintiff to embark on the project. The plaintiff came for assistance after the project had taken off. There was no formal commitment to finance the project. The parties have not agreed and the plaintiff has in fact not complied with the initial terms as in the defendants letter of January 2001.
10. I am not aware that the plaintiff had prospective buyers for the houses that were to be built.”
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Contrary to paragraph 6 of his statement on oath sworn to on 22/6/2011 that the respondent was induced to purchase a parcel of land for the purpose of the project by the assurance that the appellant would grant a loan of 50 Million naira to the respondent, PW1 under cross examination said the land for the project had been acquired before the discussion with appellant. Most importantly, he said discussion on the loan agreement had been concluded but the implementation of the conditions was still ongoing. He confirmed that one of the conditions for the grant of the loan was that the company would deposit its title documents with the appellant. However, he was unable to confirm that the condition was complied with. He also confirmed that Exhibits 16 and 17 contain the further requirement that the respondent was to fulfill to get the financial assistance. DW1 in his statement on oath stated that the parties have not reached an agreement and respondent has not met the pre-contract conditions given by the appellant in its letter of January, 2001. Under cross-examination, he said the unconditional guarantee for monthly payment of 4.8 Million Naira was to cover the tenure of the facility and the three months payment was not enough. He further said the guarantee for payment by a reputable bank was only one of the conditions. The other requirements were not complied with.
The law is settled that where a contract is made subject to the fulfillment of certain specific terms and conditions, the contract is not formed and not binding unless and until those terms and conditions are complied with or fulfilled. See BEST NIG. LTD. V. BLACKWOOD HODGE NIG.LTD.(SUPRA) AT 38 (D-F), BPS CONSTRUCTION & ENGINEERING CO. LTD. V. FCDA (2017) LPELR-42516(SC) AT 40-41 (F-B), ATIBA IYALAMU SAVINGS & LOANS LTD. V. SUBERU & ANOR. (2018) LPELR- 44069(SC) AT 19 (B-C). The respondent failed woefully to establish its assertion that all the terms and conditions stipulated by the appellant in Exhibits 2, 16 and 17 were complied with. The respondent did not adduce a scintilla of evidence to show that its title documents were deposited with the appellant or that the title to the estate was totally transferred to the appellant as stipulated in Exhibit 2. The Court below overlooked the evidence of PW1 that he could not confirm whether the respondent’s title documents were deposited with the appellant and DW1’S evidence that the pre-conditions for the contract were not fulfilled by the respondent and that the guarantee for payment by a reputable bank was just one of the conditions. The Court seriously erred both on the facts and in law when it held that the respondent had performed its own side of the contract. The basis of the finding of the Court below that there was a valid contract implied by law was stated at pages 239-240 of the record of appeal as follows:
“In the instant case, there is evidence that the plaintiff on the prompting of the defendant urged all its twenty five sub-contractors to open an account in the defendant bank while parties were discussing the terms of the facility. The plaintiff paid the contractors through those accounts while the defendant was deducting COT and VAT plus other charges. The defendant took undue advantages of the fiduciary relationship between the parties and induced the plaintiff to satisfy the terms and conditions among others for the granting of the loan facility of N50,000,000.00 without fulfilling its own part of the contract.
To prevent unjust enrichment the Courts have invented the term implied contract. According to Blacks Law Dictionary 9th Edition page 370, it is an obligation created by law for the sake of justice because of some special relationship between the parties in order to prevent unjust enrichment. It is a remedy that allows the plaintiff to recover a benefit conferred on the defendant.
I have therefore come to a conclusion that there was a valid contract implied by law and made between the plaintiff and the defendant for the granting of loan of N50,000,000.00.”
The law is settled that evaluation and ascription of probative value to the evidence led is the primary duty of the trial Court which an appellate cannot interfere with unless it is shown that the trial Court failed to perform its duty or that the finding made by the Court is perverse. What constitutes a perverse decision has been stated in a plethora of cases. See ODOM & ORS. V. PDP & ORS. (2015) LPELR-24351(SC) AT 39 (A-D) where the Supreme per MUHAMMAD, J.S.C. stated instances where the decision of Court would be regarded as perverse as follows: “A finding of fact or decision is said to be perverse when it runs counter to pleadings and evidence on record or where the Court which findings or decision are/is being reviewed is shown to have taken into account irrelevant matters or shut its eyes to the obvious and by its very nature the finding or decision has occasioned a miscarriage of Justice. A decision being reviewed may as well be found to be perverse on account of the trial Court’s wrongful application of the law to correctly ascertained facts. See Yaro V. Arewa Construction Ltd & Ors (2007) 16 NWLR (Pt.1063) 333 at 374 and Olaniyan & ors v. Fatoki (2013) LPELR – 20936 (SC).”
All the instances mentioned by the Supreme Court in the above case are present here. The finding of the Court below that there is a valid contract implied by law is a clear misapprehension and misapplication of the principle of implied contract. An implied contract is the opposite of an express contract. An express contract is one voluntarily entered into by parties upon negotiated and agreed terms and conditions and often reduced into written documents by the parties. An implied contract is a contract which is assumed to exist or inferred from the actions, conduct and circumstances of the parties. An implied contract is treated as a contract only for purpose of giving a remedy to a party whose action or conduct has benefited another in circumstances where without the remedy the benefiting party will be unfairly enriched by the action or service rendered by the other party. The burden is on the party asserting an implied contract to prove an unjust enrichment by the other party and the necessity to imply a contract. In the instant case, parties were fully engaged in negotiation on the terms and conditions of the contract. The negotiations were fully documented. The appellant clearly set out the conditions on which it may grant the request of the respondent for a 50Million naira loan. On the entire evidence on record, there is no doubt that the appellant did not fulfill some if not all those conditions. The law is settled that where parties have agreed on the terms and conditions of their contract and reduced them into writing, the contract document must be the guide for determining any question or dispute which arises in respect of the contract. See ONYKWELU V. ELF PETROLEUM (NIG) LTD. (2009) LPELR-2733 (SC), B.F.I. GROUP CORPORATION V. B.P.E. (2012) LPELR-9339 (SC) AT 23-24(C-A), A.B.C. TRANSPORT CO. LTD. V. OMOTOYE (2019) LPELR-47829(SC) AT 15 (B-C). An implied contract is inconsistent with an express agreement, the terms and conditions of which are in writing. There cannot be an implied agreement or contract where as in the instant case a party fails or refuses or neglected to comply with a term of a written agreement.
The Court below held that the contract was not executory in nature. An executory contract is a contract where the parties have reached an agreement but none of the parties has signed or executed the contract document or performed its own side of the contract. See UNITY BANK PLC V. OLATUNJI (2014) LPELR- 24027(CA) AT 46 (F). Even if there was an agreement to grant a loan, it was based upon fulfillment of all the conditions stated in the documents referred to earlier in this judgment. The respondent did not fulfill a condition for the grant of the loan. A breach of an executory contract may be a good reason for the innocent party to repudiate the contract. See THE UNITED CALABAR V. MESSRS ELDER DEMPSTER LINES LTD (1972) LPELR-3406 (SC) AT 18 (C-D). The respondent having failed to fulfill a condition for the grant of the loan, the appellant was not under any obligation to grant the loan. There was no valid and enforceable contract between the appellant and the respondent. Issue 1 is resolved in favour of the appellant.
On issue 2, the appellant’s counsel submitted that the respondent’s claim did not include any of the declarations made by the Court below and the Court is not allowed to make a case for any of the parties or grant to a party any claim different from the claim before the court. He referred to IKEANYI V. A.C.B LTD. (1997) 2 NWLR (PT.489) 509. On the award of damages, the appellant’s counsel submitted that the claim for special damages was not strictly proved as required by law and the Court was wrong in relying on the respondent’s statement of account which was merely dumped on the court without any reference to it by PW1.He referred to ALAO V. AKANO (2005) 11 NWLR (PT. 935)160 AT 178.
In response, the learned counsel for the respondent submitted that the disappearance of all the documents sent to the appellant on ten occasions is a mark of gross negligence, deliberate acts, extent of frustration caused to the plaintiff and a sign of irresponsibility. He submitted further that the respondent suffered monetary losses from the bank charges on the deposits in the respondent’s account made for the sole purpose of facilitating the housing project to the tune of 50 million naira. Counsel finally submitted that an appellate Court can only interfere with an award of general damages if it is made on wrong principle of law or the amount is so high or so low as to make it an entirely erroneous estimate.
RESOLUTION
The law is settled that both the parties and the Court are bound by the pleadings and the Court must confine itself to the issues joined by the parties in their pleadings. The Court is forbidden from making a case different from the case set up by a party in his pleadings or granting a relief not asked for by a party. See FAGBENRO V. AROBADI & ORS (2006) LPELR-1227 (SC) AT 10 (A-E), OMOKUWAJO V. FRN (2013) LPELR-20184(SC)AT 30-31(C-A), KAYILI V. YILBUK & ORS. (2015)LPELR-24323(SC) AT 52 (A-F). In the pleadings of the respondent, no allegation of unfair business practices, misrepresentation and false assurances was made against the appellant. No evidence of unfair business practices, misrepresentation, false assurance or inducement was proffered by the respondent at the trial. In B.F.I. GROUP CORPORATION V. B.P.E. (2012) LPELR-9339 (SC) AT 53 -54 (B-C) the Supreme Court per ARIWOOLA, J.S.C. held that:
“It is noteworthy that this Court has in several cases stated that the Court is to determine and decide disputes brought before it in accordance with the evidence, both oral and documentary only, in particular, as agreed by the parties. The Court is not to draft or make out a different agreement for parties. It will amount to injustice, or miscarriage of justice, to say the least. In Baker Marine (Nig) Ltd v. Chevron (Nig.) Ltd. (2006) 8-9 SCM 103 at…; (2006) 13 NWLR (pt.997) 276 at 287-288, this Court, per Ogbuagu, JSC opined thus: “It has been stated and restated in a number of decided authorities that in the interpretation of contracts or documents, the basic principle of law, is that, it is not the duty of any Court or Tribunal to make contract for parties. See; Fakorede & Ors. v. Attorney General of Western State (1972) 1 All NLR 178 at 189. Contract as a rule are made by the parties thereto who are bound by the terms thereof and the Courts are always reluctant to read meaning into a contract terms on which there is no agreement. See Alhaji Baba v. Nigeria Civil Aviation Training Centre & Anor (1991) 5 NWLR (Pt.192) 388 at 413; (1991) 7 SCNJ 1. In other words, a Court or Tribunal cannot write a new contract for the parties.”
The respondent’s claim was for special and general damages for alleged negligent acts of the appellant and no more. It was therefore wrong for the Court below to make a case different from what the respondent made for itself in its pleadings. The declaration made by the court below amount to building a case for the respondent different from the case presented by the respondent for adjudication and granting a relief different from the one sought by the respondent.
On the claim for damages, the Court below held as follows at pages 241-242 of the record of appeal:
“The plaintiff’s claim for both special and general damages in this case is for the negligent acts of the defendant. Negligent tort (sic) is the tort committed by failure to observe the standard of care required by law under the circumstances. In this case, the plaintiff has not been able to satisfy this Court that there is a duty of care recognised by law which the defendant has breached in the loan agreement under the duty to perform its own part of the contractual obligation. It seems to me that the argument that the damages arose from a breach of a duty of care is misconceived.
However, there is cumulative remedy in business tort. It is a tort that impairs some aspects of an economic interest or business relationship and causes economic loss rather than property damages or bodily harm. It includes unfair business practices. See Blacks Law Dictionary 9th Edition page 1626. In the instant case, the plaintiff is a victim of unfair business practices which has occasioned loss and damages to the plaintiff.
In the case of NEKA BBB Ltd V. ACB Ltd (2004) Vol. 115 LRCN 2949, it was held that damages in tort is compensation for loss sustained arising out of the fact or omission of a defendant. The method of proof of special damages is to lay before the Court concrete evidence demonstrating in no uncertain terms easily cognizable the loss or damages the plaintiff has suffered so that the opposing party and the Court as the umpire would readily see and appreciate the nature of the damages suffered and being claimed. It should not rest on a puerile conception or notion which would give rise to speculation, approximation or estimate or such like fractions. There is evidence in the case that the plaintiff sustained special losses and damages as follows:
a. COT charges: N878,945,78
b. VAT charges: N43,947,29
c. Fee on facility: N25,000.00
d. Interest charges: N84,860.00
e. Request charges: N115,7412.82
In prove of the above claims the PW1 tendered the plaintiff’s statement of account which was admitted in evidence and marked exhibit 19 in this suit.”
The law is settled that the burden of proof is on the party who alleges negligence to plead and lead credible evidence to prove the following elements of negligence: (1) the negligent act and the particulars of negligence (2) the existence of duty of care owed by the defendant to the claimant (3) the breach of the duty of care (4) the damages or loss suffered as a result of the breach of duty of care by the defendant. All the elements of negligence must co-exist. Failure to plead and prove any of the elements of negligence will be fatal to the case of the claimant. See I.M.N.L. V. NWACHUKWU 4) (2004) LPELR-1526 (SC) AT 22 (B-D), UNIVERSAL TRUST BANK OF NIG. V. OZOEMENA (2007) LPELR-3414 (SC) AT 14 (D-E), IYERE V. BENDEL FEED AND FLOUR MILL(2008) LPELR-1578(SC) AT 40-41(G-E). A.B.C. TRANSPORT V. OMOTOYE (2019) LPELR-47829 (SC) AT 6-7 (F-B). Before a Court finds a defendant liable in negligence, the Court must carefully consider the evidence led as it is settled law that negligence is a matter of fact not law. In the instant case, PW1 in paragraph 12 of his statement on oath stated that the respondent sent completed proposal forms and attachments to the appellant’s head office ten times and all were destroyed or deliberately tugged away by the appellant to concretize the frustration, losses and damages suffered by the plaintiff. The respondent did not tender a single copy of the ten proposal forms or the attachments or a single acknowledgement of receipt of any of those documents by the respondent. Neither a copy of the respondent’s title document allegedly deposited with the appellant nor acknowledgement was tendered. The respondent could not have asked for a release of the title deeds which PW1 in his evidence under cross examination at page 170 of the record of appeal could not confirm was deposited with the appellant. The respondent could not state or specify or even present the list of documents sent to the appellants. The assertions of the respondent was not supported by any evidence. The Court having held that the respondent failed to satisfy the Court on the existence of duty of care and breach of same in the loan agreement, the respondent’s claim whether it was in contract or negligence automatically failed and should have been dismissed by the court. In G.K.F. INVESTMENT (NIG) LTD V. NITEL(2009) LPELR – 1294(SC) AT 19-20 (C-B) the Supreme Court per MUKHTAR, JSC held as follows:
“The learned counsel for the appellant in proffering argument under this issue set out the definition of the word ‘negligence’ as is set out in some Supreme Court judgments, as Odinaka v. Moghalu 1992, 4 NWLR part 233 page 1, and A.N.T.S. v. Atoloye 1993 6 NWLR part 298 page 233. In the case of Anyah v. Imo Concorde Hotels Ltd. 2002 18 NWLR part 799 page 377 the conditions that have to exist before the claim of negligence can be raised were set down. Kalgo J.S.C. in the lead judgment had the following to say:- “The general principle is that the tort of negligence arises when a legal duty owed by the defendant to the plaintiff is breached and to succeed in action for negligence the plaintiff must prove by the preponderance of evidence or the balance of probabilities that: “(a) the defendant owed him a duty of care; (b) the duty of care was breached; (c) the defendant suffered damages arising from the breach”. See Agbonmagbe Bank Ltd. v C.F.A.O. (1966) 1 All N.L.R. 140 at 145. The most fundamental ingredient of the tort of negligence is the breach of the duty of care, which must be actionable in law and not a moral liability. And until a plaintiff can prove by evidence the actual breach of duty of care against the defendant the action must fail. See Benson v. Otubor (1973) 3 SC. 19; Okoli v. Nwagu 1960 SCNLR 48; (1960) 3 FSC 16, Nigeria Airways Ltd. v. Abe 1988 4 NWLR (pt. 90) 524…”
The Court having held that the argument that the alleged loss suffered by the respondent arose from a breach of duty of care is misconceived, the Court was wrong to place reliance on the case of NEKA BBB V. ACB LTD (SUPRA) to award special damages because the appellant’s claim in that case was in detinue in that the defendant/respondent failed and/or refused to return the appellant’s original title deeds with the bank on demand or alternatively damages for negligence for the loss of the title. The respondent’s claim in the instant case though cleverly expressed to be in negligence is in fact and in law an action for breach of contract. In law, before a claim for special damages for breach of contract is awarded, the existence of a contract must first be clearly established. I have earlier in this judgment held that the respondent failed to prove the existence of a valid contract between the parties. Therefore, there was no basis for the award of special damages to the respondent. The appellant pleaded in paragraph 9 of its statement of defence that the several lodgements into the respondent’s account were not in consideration of any agreement for the housing project. DW1 stated so in his statement of defence. Beyond the failure to prove the existence of a valid contract the breach of which occasioned a loss to the respondent, the respondent on its own showing by the averments in paragraph 12 of the further amended statement of claim and the evidence of PW1 in paragraph 17 of his statement on oath, the special damages which the appellant claimed it suffered as a result of the appellant’s failure to grant the loan were COT charges, VAT charges, fee on facility, interest charges, request charges, interest on those charges at the rate of 33% for 7 months and legal fees. It is not the case of the respondent that the appellant was not entitled to those charges in the first place. Apart from tendering the statement of account, there is no scintilla of evidence to show that the respondent is entitled to a refund of the charges for banking services already rendered by the appellant. There was no basis for the finding of the Court that the respondent urged all its contractors to open accounts with the appellant and that the appellant took advantage of the fiduciary relationship between the parties and induced the respondent to satisfy the terms and conditions for granting the loan.
The basis for the award of 10million naira general damages against the appellant was stated by the Court below at pages 243- 244 of the record of appeal as follows:
Secondly in claim for general damages, the law is that a trial judge is entitled to make his own assessment of the quantum of general damages which must not be manifestly too high or so extremely too low. It must not be awarded on a wrong principle of law as to make it erroneous.
In the instant case, the plaintiff has claimed a total of N3,327,183,000.00 as special and general damages arising from the acts of the defendant which would have been avoided if the defendant had made it’s inability to perform it’s part of contractual agreement.(sic). From Exhibit 2 which contains the offer by the defendant on the loan facility, it is clear that discussion by the parties took place on 19th January, 2001. Exhibit 17 is the document where the Managing Director of the plaintiff accepted the repayment by monthly irrevocable standing payment order of N4.8 Million. For over one year, the defendant had continuously given the plaintiff assurances that it would grant it the loan of N50,000,000.00. This is deducible from the contents of documents exchanged by the parties within the period. It was the representation and inducement that was the order of the day without actual disbursement or draw down in the loan account while the defendant was demanding and collecting the N4.8 Million irrevocable mandate for four months with effect from May 2001. This is grossly unfair on the part of the defendant.
In the case before the Court, there is no claim for specific performance of the contract. There is also no claim for refund of money or release of title deeds. The Court is not Father Christmas and it cannot award a claim that a party has not made before it.
The defendant never disbursed the loan to plaintiff. On 1st February, 2002 the plaintiff’s counsel wrote a letter to the defendant on the consequence of its conduct. On 6th March, 2002, he sent a reminder. The defendant replied on 13th March, 2002 promising speedy resolution of the issue raised and promising to communicate the bank’s final position to the plaintiff. But no action was taken by the defendant until the plaintiff filed this action in court on the 12th of July, 2005.”
The Court at page 241 of the record concluded based on the above facts that the respondent is a victim of unfair business practices which has occasioned loss and damage to the respondent. First, negotiation no matter how protracted could not take the place of or be likened to an agreement or contract to lend money. See NEKA BBB V. ACB LTD (SUPRA) AT 37 (A), CHUKWUMA V. IFELOYE (2008) LPELR-862 (SC) AT 44(A-B). PW1’S evidence at page 169 of the record that the implementation of the condition for the loan was still going sealed the fact that the agreement or the process for the grant of a loan was far from being concluded. The conclusion of the Court below that the respondent is a victim of unfair business practices is perverse. Unfair business practice connotes fraud, misrepresentation, oppressive and unethical practices by businesses aimed at deceiving the customers or against the competitors. There was no allegation of fraud, misrepresentation, oppressive and unethical practices against the appellant either in the pleadings or the evidence of the parties in this case.
Assuming for the sake of an argument that there was an agreement between the appellant and respondent for the grant of the 50 Million naira loan, no issue of breach can arise when the borrower is yet to fulfill a condition for the grant of the loan and consequently an award for special or general damages is definitely without basis in law. Issue 2 is resolved in favour of the appellant.
In conclusion, I find that the appeal has merit. It is hereby allowed. The judgment of the High Court of Enugu State delivered in suit no. E/568/2005 on 5/11/2013 is hereby set aside. The respondent’s claim is hereby dismissed in its entirety. There shall be N100,000:00 (One Hundred Thousand Naira) costs in favour of the appellant against the respondent.
JOSEPH OLUBUNMI KAYODE OYEWOLE, J.C.A.: I have had the privilege of reading the draft of the lead judgment just delivered herein by my learned brother MISITURA OMODERE BOLAJI-YUSUFF, JCA and I totally endorse the reasoning and conclusion therein.
For the more detailed reasoning in the lead judgment, I shall equally allow this appeal.
I adopt the consequential orders in the lead judgment as mine.
ABUBAKAR SADIQ UMAR, J.C.A.: I have read before now, the judgment of my learned brother, MISITURA OMODERE BOLAJI-YUSUFF, J.C.A, just delivered.
I agree with the reasoning and the conclusion arrived at in the lead judgment that the appeal has merit, and is hereby allowed.
The judgment of the High Court of Enugu State delivered in Suit No. E/568/2005 on 5/11/2013 is set aside.
I abide by the consequential order made in the lead judgment.
Appearances:
Ogochukwu Onyekwuluje For Appellant(s)
P.U. Maduka, Esq. For Respondent(s)