3PLR – ADEKUNLE AJANI (MOGAJI) & ORS. (FOR THEMSELVES AND ON BEHALF OF AJOBIARE FAMILY) V CHIEF AYODELE OKUSAGA

POLICY, PRACTICE AND PUBLISHING, LAW REPORTS  3PLR

[PDF copy of this judgment can be sent to your email for N300 only. Just order through lawnigeria@gmail.com and info@lawnigeria.com or text 07067102097]

 ADEKUNLE AJANI (MOGAJI) & ORS.

(FOR THEMSELVES AND ON BEHALF OF AJOBIARE FAMILY)

V

CHIEF AYODELE OKUSAGA

(ADMINISTRATOR OF THE ESTATE OF MADAM D. I.

OKUSAGA, NEE ONAMUSI)

HIGH COURT OF OYO STATE (IBADAN)

SUIT NO. 1/89/75

29TH OCTOBER 1976

3PLR/1976/12  (HC)

 

BEFORE

FAKAYODE, J.

 

BETWEEN

ADEKUNLE AJANI (MOGAJI) & ORS. (For themselves and on behalf of Ajobiare family)

 

AND

CHIEF AYODELE OKUSAGA (Administrator of the Estate of Madam D. I. Okusaga, nee Onamusi)

 

REPRESENTATION

Adekola – for the plaintiffs

Okusaga in person

 

MAIN ISSUES

Fraud—Deed of Conveyance—Setting aside of- Fiduciary relationship between Solicitor and client—Presumption of undue influence.

Practice and Procedure-General traverse in pleadings-Order 13 rr. 10 & 11 of the High Court (Civil Procedure) Rules.

FAKAYODE, J.: The plaintiffs’ claim against the defendant is for an order setting aside the deed of conveyance dated 26th of March 1964 and registered as No. 19 at page 19 in Volume 731 of the Lands Registry at Ibadan purportedly executed in favour of the defendant by the plaintiffs on the ground of fraud.

Pleadings were filed by the parties. The following paragraphs of the Statement of Claim are set out hereunder as being very material:-

“2. The defendant is a Legal Practitioner based in Ibadan and the Administrator of his mother Madam Okusaga’s (Nee Onamusi) estate.

3. The plaintiffs were the original owners of a vast area of land along both sides of Eleiyele road from the Oke-Ibadan down to the police headquarters.
4. The defendant became the Solicitor of the plaintiffs family during the civilian regime.
5. On or about the year 1963 when the Western State Government wanted to acquire a large area of land at Eleiyele, the defendant approached the plaintiffs’ family to hand over the plaintiffs’ family property to the defendant particularly in order to ensure adequate compensation being obtained for the plaintiffs’ family by the defendant.
6. As a result of the assurance given to the plaintiffs’ family by the defendant, a power of attorney dated 2nd of April 1963 and registered as No. 54 at page 54 in Volume 601 in the Lands Registry at Ibadan was executed in favour of the defendant Chief Ayodele Okusaga.
7. Prior to the execution of the power of attorney recited above, the plain-tiffs’ family had validly sold parcels of land to the defendant, by virtue of conveyance dated 9/11/62 and 25/5/62 and registered as No. 4 at page

4 in Volume 620 and No. 11 at page 11 in Volume 565 respectively in the Lands Registry at Ibadan.

11. The conveyance dated 26th of March 1964 and registered as No. 19 at page 19 in Volume 731 of the Lands Registry at Ibadan now sought to be set aside were executed, (if executed by the plaintiffs’ family) were so executed without the knowledge or awareness that it was meant to trans-fer the plaintiffs’ family property to the defendant’s mother.
12. The plaintiffs will show at the hearing of this case the systematic fraud played on the plaintiffs’ family by the defendant in that 150 acres of the plaintiffs’ family land situated at Eleiyele was purported to have been sold to the defendant for N300 by virtue of a conveyance dated 29/5/65 and registered as No. 59 at page 59 in Volume 840 of the Lands Registry at Ibadan by the plaintiffs’ family.
13. The conveyance sought to be set aside covering 21.48 acres was purported to have been sold for N4,000 in 1963 while the conveyance recited in paragraph 12 above, covered 150 acres and was purported to have been sold for N300 in 1965 even though the two parcels of land were in the same area and contiguous to each other.
14. The defendant’s son, one Adewale Obafemi Okusaga, unknown to the plaintiffs’ family also had a conveyance purported to have been executed in his favour in respect of the plaintiffs’ family property at Eleiyele dated 15/9/67 covering 11.704 acres in which the selling price was put as 14600 and the conveyance was registered as No. 11 at page I1 in Volume 1039 at Ibadan Lands Registry.
15. The plaintiffs’ family knew about the conveyances referred to in paragraphs 12 and 14 above for the first time after this case had been in Court, and the plaintiffs will contend at the hearing of this case, that negotiation never took place nor was purchase price received in respect of the purported sale of the plaintiffs’ family land to members of the defendant’s family.
16. The plaintiffs family were taken to Court on many occasions to sign some documents which were represented to the plaintiffs’ family to be documents which will facilitate the payment of compensation to the plaintiffs’ family.
17. The plaintiffs did not know Madam Okusaga (Nee Onamusi) who was the mother of the defendant nor did the plaintiffs sell the said land of 21.48 acres covered by the said conveyance to the said Madam Okusaga (Nee Onamusi).
18. The plaintiffs assert that sums of monies ranging between N40 to 1460 were on many occasions loaned out by the defendant to the plaintiffs in lieu of compensation due to the plaintiffs from the Western State Government.
19. The plaintiffs never received the sum of 144,000 from the said Madam Okusaga or from the defendant or through any body, as purchase price of the land covered by the conveyance.
20. The plaintiffs will therefore contend at the hearing of this case that:-

(a) The plaintiffs could not have executed a valid conveyance registered as No. 19 at page 19 in Volume 731 during the subsistence of power of attorney to the defendant.

(b) The said conveyance was executed by virtue of the fraudulent misrepresentation of the defendant, as to the real purport of the document signed in Court as represented to them in paragraph 16 above.

(c) Neither Onamusi nor any person negotiated for the sale of the said land with the plaintiffs.

(d) The sum of N4,000 indicated as purchase price of the land in the conveyance sought to be set aside, was never received by the plaintiffs’ family either from the defendant, his mother, or anybody.”

Equally important are the following paragraphs from the Statement of Defence:-

3. “With reference to paragraph 4 of the Statement of Claim the defendant admits that he was employed to handle a few matters on an “ad hoc” basis for this family during the relevant period but denies being their general or exclusive Solicitor and says that the plaintiffs from time to time during the relevant period used the services of several other Solicitors.
4. With further reference to paragraph 5 of the Statement of Claim the defendant says that Government’s intention to acquire land at Eleiyele area of Ibadan was first made public in October 1964 and certainly not in 1963. The allegation that this took place in 1963 was a fabrication made to cover the fraud which plaintiffs had played upon the defendant a year earlier on in 1963, as will be shown hereafter.
5. In early 1963 the plaintiffs’ family prevailed upon the defendant to undertake appeal No. FSC 231/62: Salawu Odekunle & Ors. v. Adewole Ajobiare at an agreed fee of N500.00. As they had no money to pay forthwith they gave to defendant a power of attorney over their land at Eleiyele to ensure eventual payment of his fee. That is the power of attorney referred to in paragraph 6 of the Statement of Claim and the land then in dispute was situate at Eleiyele area.
6. The defendant says that in 1964 the defendant’s mother bought through him and for value from plaintiffs’ family 21.48 acres of land at Eleiyele area of Ibadan and the same was authenticated by a deed of conveyance regularly executed before a Chief Magistrate by the plaintiffs’ family and thereafter registered as Instrument No. 19 at page 19 in Volume 731 of the Lands Registry in the office at Ibadan.
7. Between 1962 and 1967, the defendant and members of his family bought a total of nine parcels of land in Eleiyele Area (including the one now in dispute) from plaintiffs’ family and the plaintiffs were paid in full for all these purchases. A schedule of all lands thus bought by and/or through defendant is shown in the schedule attached hereto as Exhibit A.
8. All the nine sales of Ajobiare family lands referred to in paragraph 12 were spread over a period of six years and each sale was concluded by a deed of conveyance regularly executed by the family representatives before a Chief Magistrate.
9. Apart from cash payments made by the defendant to the plaintiffs’ family as a unit as consideration for all purchase of land thus made from the plaintiffs’ family, several leading members of the Ajobiare family including Adewole (their late Mogaji) Adekunle (their present Mogaji), Busari Fadesire, Layiwola Adedeji, Akinola Adisa, Ladid Adisa used to insist upon getting extra substantial payments before agreeing to sales or to join the other representatives in executing conveyances to the defendant and his relations.
10. The defendant will also rely upon letters and written acknowledgments made independently of the various sales to show that the family of Ajobiare had got all the money due on these sales from the defendant and from the other members of his family who had bought lands from Ajobiare family through him.
11. The defendant will prove at the trial of this action that the, plaintiffs are not an ignorant and unsophisticated group who could be systematically imposed upon by defendant as they had tried to portray themselves in several paragraphs of the statement of Claim; but are in fact persons very knowledgeable in matters of land sales, leases and conveyancing.
12. The defendant was by reason of other commitments unable as from 1968 to buy any more land from the plaintiffs’ family even though they greatly importuned him to do so; but he did from time to time make petty loans and small gifts of money to many of them when they sought his assistance e.g. to pay their taxes.
13. In November 1969, the demand of the plaintiffs’ family against the defendant was only for the sum of N2,950.00 (£1,475.0.04.) being balance of cost of lands alleged sold by them to the defendant on credit and, to enforce this false claim, the plaintiffs secured the assistance of one Chief L.S. Animashawun to plan and carry out their strategy; but when Animashawun failed to get plaintiffs’ land agent to cooperate fully in the fraud, the claim for 142,950.00 was dropped.”

Each side to this action adduced evidence pursuant to the Statement of Claim or Statement of Defence and from the pleadings and the evidence adduced, I find that I have to determine the following issues:

1. The question of consideration for the deed of conveyance in issue i.e. deed registered as No. 19 at page 19 in Volume 731 at the Lands Registry in Ibadan;
2. The question of fraud; and
3. The question of the relationship of Solicitor and client. (a) Issue of Consideration-

The deed in question in this action was tendered as Exhibit “A”. It was executed by the plaintiffs in favour of the defendant’s mother. It was stated in Exhibit “A” that the purchase price for the 21.48 acres sold and conveyed thereby was N4,000.00. The plaintiffs pleaded and contended in evidence that not a kobo of this amount was paid by the defendant to the plaintiffs. The plaintiffs also contended that there was no negotiation or bargain for sale of land between the plaintiffs and anybody. In connection with this issue of non-payment of the consideration money in Exhibit “A”, the defendant tendered the following receipts as Exhibits:-

EXHIBIT DATE AMOUNT PURPOSE

M 31/3/65 N10.00 Instalment of Land Price

R 20/3/63 50.00

R1 20/3/63 N120.00

R2 22/3/63 N200.00

R3 14/5/63 N40.00

N 26/9/67 N100.00

N2 15/11/67 N100.00

N3 28/11/67 N100.00

N1 23/10/67 N27.00 Loan

N4 18/9/67 N23.00 Loan

Total N770.00

My finding is that none of the receipts listed above related to the consideration money of N4,000.00 inserted in Exhibit “A” dated March 1964. The defendant tendered Exhibit “K” which was a letter dated 12th February, 1970 in which the plaintiffs said that the defendant had fully paid for the parcels of land bought from the plaintiffs’ family. I do not regard Exhibit “K” as being a conclusive or genuine admission by plaintiffs because-

(i) The plaintiffs in their evidence through PW1 said Exhibit “K” was drafted for them by the defendant and was executed in defendant’s house;

(ii) Exhibit “K” was executed when plaintiffs needed financial assistance from the defendant and the defendant would not give plaintiffs a loan unless Exhibit “K” was executed as drafted by him.

I reject the evidence of D. W. 2, Jones Olupitan, that he drafted Exhibit “K” on plaintiffs’ instructions because this version was not put to P.W. 1 under his cross-examination and the defendant himself in his evidence did not deny P.W. I’s evidence regarding the drafting and execution of Exhibit “K”. I hold, as submitted by plaintiffs’ Counsel, that Exhibit “K” was induced by the defendant because plaintiffs needed some money then. The defendant also tendered Exhibit “J” which was a letter dated 24th November, 1969 written by one Animashaun to the defendant on plaintiffs’ instructions. In Exhibit “J”, plaintiffs said that the price of the land in question was N4,000.00 out of which the defendant had paid only N1,050.00 leaving a balance of N2,950.00 unpaid despite plaintiffs’ repeated demands. The defendant did not give plaintiffs any reply to this letter, Exhibit “J” from the contents, of which I hold that the defendant is still owing the plaintiffs the sum of N2,950,00 as balance of the purchase price of the land sold and conveyed by means of Exhibit “A”.

It is true that nowadays, almost every defendant pleads the general traverse i.e. “Save as hereinafter (or hereinbefore) specifically admitted, the defendant denies each and every allegation contained in the Statement of Claim as though the same were herein set out and traversed seriatim”. Whilst this type of pleading may be good in cases of general and less important allegations in a Statement of Claim, it is insufficient for meeting important and specific allegations of facts as in paragraphs 15, 16, 17 and 27 of Statement of Claim. The general rule is that a traverse must not be evasive- see Thorp v. Holdsworth (1875-76) 3 Ch. D. 637. Also our Order 13 rules 10 and 11 provide thus:-

“Rule 10 It shall not be sufficient to deny generally the facts alleged by the Statement of Claim, but the defendant must deal specifically therewith, either admitting or denying the truth of each allegation of fact seriatim, as the truth or falsehood of each is within know-ledge, or (as the case may be) stating that he does not know whether such allegation or allegations is or are true or otherwise. Rule 11 When a party denies an allegation of fact he must not do so evasive-ly, but answer the point of substance. And when a matter of fact is alleged with diverse circumstances it shall not be sufficient to deny it as alleged along with those circumstances, but a fair and substantial answer must be given.”

In the case in hand, the Statement of Defence and the evidence of the defendant did not indicate facts as to when and how the purchase price in Exhibit “A” was paid. For instance, the defendant failed to say whether the payment or part payment was made by cheque or cash or both. However, I hold from Exhibit “J” that the plaintiffs admitted that the defendant paid them N1,050.00, leaving a balance of N2,950.00 unpaid out of the purchase price. I also hold from the contents of Exhibit “J” that the defendant induced the plaintiffs to execute Exhibit “A” by representing to the plaintiffs that some sizeable amount of money would come to the parties from the Government acquisition of part of plaintiffs’ land. I further hold, from the contents of Exhibit “J”—that proper bargaining or negotiation as between a willing seller and a willing buyer did not precede the execution of Exhibit “A”.

(B) Issue of Fraud

A distinction must be drawn between fraud at common law and fraud in equity. Fraud or deceit at common law is “misrepresentation of fact, made either knowingly, or without believe in its truth, or recklessly, not caring whether it was true or false”—see Derry v. Peek (1899) 14 App. Cas. 337. Fraud at common law is often referred to as actual fraud but fraud in equity is referred to as constructive fraud. Whilst actual fraud or common law fraud relates to statements or misrepresentation of fact, constructive fraud or fraud in equity relates to conduct or transactions in respect of which the Court is of opinion that it is unconscientious of a person to avail himself of the legal advantage he has obtained—see An Introduction to Equity by Keeton, 6th Edition pages 223-234.

Generally speaking, constructive fraud or fraud in equity is classified under the headings:

(a) Inequitable and unconscionable bargains as exemplified in Evans v. Llewellin (1787) 1 Cox Eq. Cas. 333 and Fry v. Lane (1888) 40 Ch. D. 312. A bargain will be regarded as being inequitable and unconscionable if one of the parties to the contract uses his great position, superior intellect or superior knowledge of worldly affairs to induce the other party of poor means weaker intelligence or great predicament to execute the contract.

(b) Abuse of a fiduciary or confidential relationship as between for examples:-

(i) Trustee and beneficiary

(ii) Parent and child

(iii) Guardian and ward

(iv) Spiritual Adviser and layman

(v) Solicitor and client

(vi) Doctor and patient

(c) Fraud upon the public or third parties as exemplified in such cases as Chesterfield v. Jaussen (1750) 2 Ves Sen 125 and Reading v. The King [1951] A.C. 507. The above list of constructive frauds is not exhaustive.

A person held liable for actual or constructive fraud can be described as having (a) been fraudulent; or (b) acted fraudulently; or (c) defrauded.

(C) Fiduciary or confidential relationship between a Solicitor and his client

From the pleadings and evidence of the parties in this case, I hold that a fiduciary relationship existed between the plaintiffs and defendant because:

(i) In June 1963, the plaintiffs employed the services of the defendant as a Solicitor to conduct an appeal in the Supreme Court in suit

231/62 Odekunle v. Ajobiare. The defendant charged N525 as his fees for the appeal and because of the impecuniosity of the plaintiffs they gave an I.O.U. as per Exhibit “E” to the defendant for that amount which remains unpaid till today.

(ii) The defendant acted as Solicitor to both the plaintiffs and the defendant’s late mother in the preparation of the deed of conveyance Exhibit “A”, now in dispute.

(iii) In 1970, the defendant, as plaintiffs’ Solicitor, wrote to Lawyer Kola Daisi as can be deduced from Daisi’s letter of 26th March, 1970—Exhibit “G”.

(iv) On the 2nd April 1963, the defendant as plaintiffs’ Solicitor got a power of attorney from plaintiffs to manage and superintend the management of plaintiffs’ family land at Eleiyele (including the land in dispute conveyed by means of Exhibit “A”). The said power of attorney was registered as No. 54 at page 54 in Volume 601 in the Ibadan Lands Registry and tendered in evidence as Exhibit “C”. The power of attorney was to be irrevocable within a period of ten years from 1963-1973 and conferred absolute title on the defendant in relation to the said family land of the plaintiffs.

(v) There are many other deeds of diverse dates e.g. Exhibits “L4”, “L3”, “L2”, “F” and “L5” in which the defendant acted as Solicitor for both the plaintiffs and defendant’s relatives.

(vi) In Exhibits “B”, “L” and “L,” which are deeds of conveyances dated 29th May, 1965, 9th November, 1962 and 25th May, 1962 respectively the defendant acted as Solicitor for himself and the plaintiffs.

Having regard to the above circumstances and the general conduct between the parties I find as a fact that at all times material to this action the defendant acted as Solicitor to the plaintiffs. I also find as a fact that between 1963 and 1970 the fiduciary or confidential relationship of Solicitor and client existed between the parties to this action.

By virtue of a fiduciary or confidential relationship which exists between a Solicitor and his client, a presumption of undue influence shall be imputed into any gift or contract of sale between the parties and the onus shall lie on the Solicitor to rebut this presumption by proving-

(i) That the client was fully informed;

(ii) That the client had competent and independent advice; and

(iii) That the price or bargain was a fair one—see Wright v. Carter [1903] 1 Ch. 27.

Even if the relationship of Solicitor and client, in the strict sense, has terminated, the presumption of undue influence will still arise if the confidence naturally attached to such relationship has not ceased having regard to the circumstances of each particular case—see Demerara Bauxite Company Ltd. v. Hubbard & Ors [1923] A.C. 673.

In my view of the evidence in this case, I hold that the defendant had failed to prove-

(i) that the plaintiffs had independent and competent legal advice with regard to the matter of this action—Exhibit “A”;

(ii) that the contract, or bargain in Exhibit “A” was a fair one; and

(iii) that the plaintiffs were truly and well informed about the true nature of the transaction in Exhibit “A”.

I also hold that the defendant induced the execution of Exhibit “A” by the plaintiffs by holding out to them a promise to pay the whole purchase price when-ever Government would have paid compensation for any acquisition of any part of plaintiffs’ land. This promise was a ruse as there was in fact no acquisition. So on the whole I find the defendant liable for the non-payment of part of the consideration money in Exhibit “A” and/or for constructive fraud which the defendant practiced on the plaintiffs with respect to the transaction in Exhibit “A”. Therefore, I hereby set aside the deed of conveyance registered as No. 19 at page 19 in Volume 731 at the Ibadan Lands Registry tendered as Exhibit “A” in this action. There shall be N200 as costs in plaintiffs’ favour against the defendant.

I must in conclusion say that plaintiffs must seek legal advice about setting aside other deeds of conveyance executed in similar circumstances by plaintiffs in favour of the defendant, his son, his mother and his uncle namely Exhibits “B”, “L2”, “L3”, “L,”, and “L5”. The most callous transaction was Exhibit “B” for the sale of 150.1 acres of plaintiffs’ land conveyed by the defendant to himself for the alleged sum of N300!! My view is that when the defendant got Exhibit “C”—the power of attorney-executed by plaintiffs in his (defendant’s) favour he intended to expropriate the plaintiffs of their family land to satisfy his greedy appetite and covetousness for the property of the poor, ignorant and illiterate plaintiffs.

This action succeeds and the deed Exhibit “A” is hereby set aside on the ground of the defendant’s fraud. There shall be N200 costs against the defendant in plaintiffs’ favour.