3PLR – LASIS ADETUYI V. THOMAS AGBOJO; CO-OPERATIVE BANK (NIG.) LTD

POLICY, PRACTICE AND PUBLISHING, 3PLR, LAW REPORTS

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LASIS ADETUYI

V.

THOMAS AGBOJO; CO-OPERATIVE BANK (NIG.) LTD

COURT OF APPEAL

(BENIN DIVISION)

CA/B/14/92

FRIDAY 28TH JUNE 1996

3PLR/1996/69  (CA)

 

OTHER CITATIONS

 

BEFORE THEIR LORDSHIPS

SUNDAY AKINTOLA AKINTAN;

SYLVANUS ADIEWERE NSOFOR;

ATINUKE OMOBONIKE IGE

 

REPRESENTATION

Dele Akinwalere (with him IC Ode) – for the Appellant

Femi Ajayi – for the 1st Respondent

2nd Respondent absent and unrepresented

 

MAIN ISSUES

CONTRACT Party who has benefited from agreement challenging same

LAND LAW Import of Land Use Act 1978; whether forbids agreement to alienate before Governor’s consent is obtained

LAND LAW Consent of Governor obtained after mortgage agreement is executed

MAIN JUDGEMENT

ATINUKE OMOBONIKE IGE Delivering Leading Judgement

This is an appeal against the judgment of Adetosoye J delivered in Suit No AK/34/90.

In the court below the appellant as plaintiff sued the respondents as defendants for the following claims as per his writ of summons.

  1. Specific performance by the 1st defendant of the agreement dated 26th day of August, 1985 between the plaintiff and the 1st defendant for the sale and transfer to the plaintiff storey building on the piece or parcel of land situate and being at Idera Street, Akure Ondo State and conveyed to the 1st defendant in the Deed of Conveyance dated 14th March, 1973 and registered as No 43 at page 43 in Volume 1451 of the Lands Registry in the Office at Ibadan now kept at Akure.
  2. N500,000.00 as Special and General damages for breach of contract in lieu of or in addition to specific performance against the 1st defendant.
  3. An Order on the 1st and 2nd defendants to execute stamp and register a Deed of Release of the Deed of Legal Mortgage between the 1st and 2nd Defendants dated 13th February, 1975 and registered as No 21 at page 21 in Volume 1661 of the Lands Registry in the Office at Ibadan now kept at Akure.

Pleadings were filed and exchanged between the plaintiff and 1st Defendant. The case proceeded to trial with the plaintiff calling 6 witnesses. The 1st defendant called 3 witnesses while the 2nd defendant gave evidence. On 3/12/90 the learned trial Judge in a reserved judgment dismissed the plaintiff’s claim as per his writ of summons.

The plaintiff being dissatisfied with the said judgment has appealed to this court by filling 3 original grounds of appeal and 3 additional grounds of appeal making a total of six grounds.

I shall quote here the 6 grounds of appeal without stating their particulars.

Grounds

  1. The trial court erred in law in refusing to grant specific performance of the said sale agreement between the appellant and 1st respondent when there was abundant evidence given by both the appellant and the respondents that there was a sale agreement and part performance between the appellant and the 1st respondent.
  2. The trial court did not properly evaluate the evidence before him and thereby came to a wrong conclusion.
  3. The decision of the trial court is against the weight of evidence.
  4. The learned trial Judge erred in law when he held that Exhibit C was An Outright Sale and Not An Agreement to sell contrary to the letters and spirit of the agreement between the parties.
  5. The learned trial Judge erred in law and on the facts when he refused to exercise his discretion to grant a decree of specific performance in favour of the appellant despite the fact that there were sufficient materials on the record of proceedings on which he could have based his discretion so to do and in favour of the appellant.
  6. The learned trial Judge misdirected himself in law when he refused to grant the appellant an award of damages in lieu of specific performance having refused to grant a decree of performance in favour of the appellant.

Out of these 6 grounds the appellant has formulated the following 4 Issues for determination

Issues

  1. Whether Exhibit C was an outright sale or agreement to sell, which sale is subject to the Governor consent as provided by law.
  2. Whether or not the appellant who has made part payment pursuant to a written agreement for alienation of land is entitled to a Decree of specific performance.
  3. Having refused to grant an order of specific performance whether the trial Judge was not in error in refusing to grant the appellants alternative claim for damages and whether in any event the appellant was not entitled to the refund of the deposit made to the first respondent and expenses incurred on the completion of the house.
  4. Whether the failure of the trial court to make specific findings of fact on the issues joined by the parties before him did not influence his appreciation of the case before him and thus occasion a miscarriage of justice.

On behalf of the 1st respondent counsel in his brief of argument has formulated 4 Issues thus

  1. Whether Exhibit C was not an outright sale in I view of the language of the agreement.
  2. Whether, the sale agreement is valid or null and void in view of the provisions of section 22 and 26 of the Land Use Act, 1978.
  3. Whether the trial court was wrong in refusing to give approval to a void although not an illegal contract by not making an order for specific performance or warding damages.
  4. Whether the trial court should make an order for a relief not sought.

In dealing with this appeal it is pertinent to note that the appellant had withdrawn against the 2nd respondent hence the battle is between the appellant and the 1st respondent only. Looking carefully at the issues raised by the parties it seems to me that the justice of the case will be met by dealing with the Issues as formulated by the appellant along with the 2nd and 4th Issues raised by the respondent.

Issue one touches on the question of whether Exhibit C was an outright sale or agreement to sell which sale is subject to the Governor’s consent.

The following facts gave rise to Exhibit C. The 1st respondent offered to sell his uncompleted building at Idera Owode Quarers Akure in Ondo State because he could not meet his financial obligations to the Co-operative Bank – the 2nd respondent. The appellant agreed to buy the said property for N50,000.00 and made a down payment of N30,000.00 to the 1st respondent leaving a balance of N20,000.00. After negotiations had been concluded the 1st respondent gave the appellant the following documents a certified true copy of the Legal Mortgage deed between the 1st and 2nd respondents and 3 building plans.

Later on an agreement later known as Exhibit C was executed. The appellant was to pay the balance of N20,000.00 upon redemption of the property in dispute by 1st respondent from the 2nd respondent. The appellant went into possession and incurred some expenses on the property to get it completed.

When it appeared to the appellant that the 1st respondent was not ready to effect the release of the Mortgage Deed from the 2nd respondent despite repeated demands, the appellant then instituted the action which is now on appeal to this Court.

It has been argued on behalf of the appellant that Exhibit C cannot be and is not an outright sale but an agreement to sell whose validity would be inchoate until the Governors consent is obtained for retrospective and comprehensive effectiveness.

Counsel for the 1st respondent submitted that at the time the appellant bought the property described in Exhibit C 1st respondent had nothing to sell as his interest in the property had been mortgaged to the 2nd respondent since 1975. 2nd respondent he said is the legal owner of the property by virtue of the Registered Mortgage Deed No 21 page 21 in volume 1661 at the Land Registry Akure, Exhibit C he says is very clear unambiguous and precise in its wordings.

All the conditions precedent for the proper execution of any simple contract are present in Exhibit C. The counsel finally submitted that Exhibit C was an agreement for an outright sale.

I would have easily bought the argument of counsel for the respondent but for the wordings of Exhibit C when properly scrutinised. I shall quote hereunder the relevant portions of Exhibit C which made me differ with respondent counsels submission. The sections read thus:

WHEREAS the vendor is the Beneficial Owner for a fee simple absolute in possession of the piece or parcel of land together with the hereditaments thereon situate and being at Idera Street, Owode Quarters Akure Ondo State of Nigeria measuring approximately 618.89 Square Yards in dimension and which is particularly delineated and Edged Red on Survey Plan No OG 537B/71 dated 17th day of December, 1971 demarcated by Survey Pillars Nos ZK 5001: ZK 5002; and ZK5003 and ZK5004 prepared by S.A. Ogunbiyi Licensed Surveyor attached to the Deed of Conveyance dated 14th March, 1973 between Oba Ademuwagun Adesida II the Deji of Akure land and Mr. Thomas Agbojo and registered as No 43 at page 43 in volume 1451 of the Land Registry in the Office at Ibadan now kept at Akure.

AND WHEREAS the Vendor has mortgaged the said piece or parcel of land together with the hereditaments thereon to the co-operative bank as contained in the Deed of Legal Mortgage dated 13th February, 1975 and registered as No 21 at page 21 in Volume 1661 of the Lands Registry in the Office at Ibadan now kept at Akure.

AND WHEREAS the vendor has agreed to transfer absolutely and free from all incumbrances all his interests in the said piece or parcel of land together with the hereditaments thereon being a Storey Building having been roofed with iron sheets plastered all over and iron burglary devices installed on the windows to the purchaser for the sum of N50,000.00 (Fifty Thousand Naira).

AND WHEREAS the vendor had agreed to liquidate all his indebtedness of N13,483.26 (Thirteen Thousand Four Hundred and Eighty three Naira Twenty six kobo) as at 31st of July, 1985 on the receipt of N30,000.00 (Thirty Thousand Naira) as part payment of the said agreed purchase price of N50,000.00 (Fifty Thousand Naira)

WHEREBY THIS AGREEMENT WITNESSETH as follows:-

  1. That in pursuance of the said agreement and in consideration of the sum of N50,000.00 out of which N30,000.00 (Thirty thousand Naira) is now paid by the purchaser to the Vendor (the receipt whereof the Vendor hereby acknowledges) the Vendor hereby sells and transfers all his interest in the said piece or parcel of land and the hereditaments thereon which is Storey Building having been roofed and plastered with burglary iron devices installed on the windows as contained in Building Plan Reg. No 882/76 of 15/4/77 of Akure Area Planning Authority.
  2. The vendor shall pay all his indebtedness to the said Co-operative Bank and secure the said Co-operative Bank to execute the Deed of Release of the said deed of legal Mortgage of 13th February, 1975 and registered as No 21 at page 21 in volume 1661 at Ibadan now kept at Akure on or before 30th day of September, 1885.
  3. On the receipt of the said Deed of Release duly executed stamped and registered the Purchaser shall immediately pay the vendor the sum of N20,000.00 (Twenty thousand Naira) as the balance of the said purchase price.
  4. The vendor shall do all that is necessary as the law may require to enable the Ondo State Governor grant the Purchaser the Certificate of Occupancy in respect of the said piece or parcel of land as contained in Survey Plan No OG537B/71 attached to the Deed of Conveyance dated 19th December, 1972 and registered as 43/43/1451 at Ibadan now kept at Akure.

Upon a close scrutiny of the wordings of Exhibit C it is very clear that 1st respondent is the fee simple owner of the parcel of land and the hereditaments thereon situated at Idera Street Owode. Akure in Ondo State.

He has mortgaged this same property together with its hereditaments to 2nd Respondent who by the way is no longer a party to this appeal because the appellant had withdrawn against the Bank on the day the appeal was heard.

It is this same property that 1st respondent has agreed to transfer absolutely and free from incumbrances all his interests in the land together with the hereditaments thereon being a Storey Building – having been roofed with iron sheets, plastered all over and iron burglary devices installed on the windows to the Purchaser for the sum of N50,000.00.

Let us pause here to consider whether or not the Vendor – 1st respondent had any interest to transfer to the appellant at the time of signing Exhibit C.

Exhibit C was executed on 26th August, 1985. As at that time 1st respondent mortgaged the said property described in Exhibit C to 2nd respondent. 1st respondent was yet to pay up all his indebtedness to the 2nd respondent bank and effect a Deed of Release on or before 30th September, 1985.

Upon receipt of the said Deed of Release, the appellant was to pay the balance of N20,000.00 to complete the purchase price of the property. In addition the 1st respondent was also in duty bound to do all that was required by the law to enable the Ondo State Governor grant the appellant the Certificate of Occupancy in respect of the said property described in the deed of Conveyance dated 19th December, 1972 registered as 43/43/1451 at Ibadan now kept at Akure.

In view of the fact that 1st respondent had to do so many things under the law in order to deliver the said property to the appellant free from all encumbrances can one really say the sale was an outright sale? My answer is in the negative. It is my candid view that the sale as described in Exhibit C is a sale with many provisional Clauses. To me it is an agreement to sell the property including its hereditaments to the appellant after vendor 1st respondent shall have taken necessary legal steps to free the property from all present encumbrances. At the best what the 1st respondent was selling to the appellant at the time of executing Exhibit C was his reversionary interest in the property subject to the Mortgagees lien on the property.

With regard to the provisions of Sections 22 and 26 vis a vis Exhibit C, the learned trial Judge has held that by operation of Sections 22 and 26 of the Land Use Act Exhibit C is null and void hence the 1st respondent had nothing to sell as any alienation must be made with prior consent of the Military Governor.

Let us look at the provisions of Sections 22 and 26 of the Land Use Act Section 22 provides thus:-

AND It shall not be lawful for the holder of a statutory right of occupancy granted by the Military Governor to alienate his right of occupancy or any part thereof by assignment, mortgage, transfer of possession, sublease or otherwise however without the consent of the Military Governor first has and obtained…AND #8221;

Section 26 provides thus:

AND Any transaction or any instrument which purports to confer on or vest in any person any interest or right over land other than in accordance with the provisions of this Decree shall be null and void .AND #8221;

When one look at the provisions of Section 22 of the Land Use Act, 1978 it is unlawful to alienate a right of occupancy without first obtaining the consent of the Governor and by Section 26 of the same Act failure to obtain such consent would render the alienation or transfer null and void.

Exhibit C purports to sell and transfer the respondents property and its hereditaments thereon situated at Idera Street Owode Akure to the Appellant. Although the document was signed on 26th August, 1985 the consent of the Governor was to be obtained at a later date.

The question to be asked is whether or not Governors consent was a condition precedent to the validity of the contract in Exhibit C.

In the case of Solanke v Abed (1962) NRNLR 92, (1962) 1 SCNLR 371 the Federal Supreme court considered Section 11 of the Land and Native Rights Ordinance Cap 105 Laws of Nigeria 1948 which is in pari materia with Sections 22 and 26 of the Land Use Act. The High court which first tried the case of Trespass held that by the effect of section 11, the sub letting under which the appellant claimed title against the respondent was null and void and as such the appellant could not maintain an action for trespass against the respondents. When the case went on appeal to the Federal Supreme court, the decision of the High Court was reversed and the agreement was held to be legal.

In that case before the Federal Supreme court Unsworth FJ had this to say about the agreement in question, I quote;

“For these reasons I am of the opinion that it was not open to the defendant in the circumstances of this case, to rely upon his own wrongful act so as to allege as against the plaintiff, that the tenancy agreement was null and void and unenforceable under Section 11 of the Land and Native Rights Ordinance. The agreement was not illegal. ”

Applying the above principles to the instant case it is my view that Exhibit C which is an agreement to sell respondents property is not illegal because there is nothing in the Land Use Act which prevents a prior execution of an agreement to sell before an approach is made to the Governor for his consent.

I am in agreement with the view of my learned brother Salami JCA which he expressed in the case of Awojugbagbe Light Industries Ltd v Chinukwe (1993) 1 NWLR (pt 270) 485 In that case the appellant contended that the Deed of Mortgage was null and void by virtue of Section 22 of the Land Use Act because the Deed was executed before the Governors consent was obtained. The court of Appeal in the judgment held that the Deed was legal Salami JCA opined thus at pages 509 -510;

“There is nothing in the Act preventing prior execution of an instrument before an approach is made to the Governor for his consent. So that the provision that the consent of the Governor must first be obtained means no more than that the agreement entered into will remain inchoate until the Governors consent is sought and obtained Consenting to a sublease mortgage transfer of possession prior to the earlier drawing up an agreement is analogous to buying a pig in the poke.”

I am in full agreement with the view expressed by my brother Salami JCA in the Awojugbagbes case (supra) more especially when the provisions of Section 22(1) of the Land Use Act 1978 is read along with the provisions of Section 22(2) of the same Act.

Section 22(2) of the Land Use Act reads thus:-

“The Governor when giving his consent to an agreement mortgage, or sublease may require the holder of a statutory right of occupancy to submit an instrument executed in evidence of the assignment mortgage or sublease and the holder shall when so required in order that consent given by the Military Governor under sub section may be signified by endorsement thereon.”

The above provisions presupposes the prior existence of an instrument executed in evidence of an assignment, mortgage or sublease before the governors consent is sought.

In the instant case Exhibit C is a prior instrument (agreement) executed in evidence of the transfer of the respondents property to the appellant before the Governors consent is sought hence it is not illegal.

The provisional clauses in Exhibit C have made it transparently clear that it is a conditional agreement which becomes effective after the condition of the Governors consent has been fulfilled. It is not illegal and the respondent whose duty it is to obtain the Governors consent would not be allowed to reply upon his wrongful act i.e. omitting or refusing to obtain the Governors consent so as to allege as against the appellant that Exhibit C is null and void.

Respondent should not be allowed to benefit from his own wrongful act – Nollus commodium caprere potest de juria sua propria.

I agree with appellants counsel submission that it is morally despicable for a person to have benefited from an agreement as the 1st respondent did in this case and then turn round to say that the agreement is null and void See the case of Adedeji v NBN Ltd (1989) 1 NWLR (pt 96) 212 It is a matter of great interest and importance to note that the Supreme court has upheld the decision of the Court of Appeal in the case of Awojugbagbe Light Industries Ltd v Chinukwe (1993) 1 NWLR (pt 270) 485 when the case went on appeal before them in 1995. The final judgment was delivered by the supreme court in appeal No 243/1992 on Friday April, 7 1995 now reported in (1995) 4 NWLR (pt 390) 379.

I am of the view reinforced with the decision of the supreme court of in Awojugbagbes case (supra) that the appellant who has made part payment in pursuance to a valid agreement Exhibit C for alienation and transfer of Land is entitled to an order of specific performance and the learned trial Judge was wrong when he refused to grant the appellants claim for specific performance. It lies in the discretion of the court to order the 1st respondent to apply for the Governors consent. This discretion should be exercised in favour of the appellant by ordering the 1st respondent to apply for the Governors consent in favour of the appellant, and I shall do so. The appellant is yet to pay N20,000.00 to the 1st respondent as the balance of the purchase price.

It is my view that the justice of this appeal will be met by granting the appellant an award of special and general Damages as an alternative to the order of specific performance in case the respondent fails to carry out the court order within the limited time.

I therefore hold that appellant is entitled to the refund of the N30,000.00 deposit made to the 1st respondent and also the expenses incurred by him on the property at Idera Street Akure.

The learned trial Judge made no findings in respect of damages at all but there is evidence on record that the respondent received the sum of N30,000.00 from the appellant. Thereafter the appellant was put in possession of the said property and he (appellant) began to expend money on completion of the building. The appellant tendered several exhibits and receipts to show particulars of special damages amount already spent on the landed property to substantiate his claims. The appellant claimed a total round figure of N500,000.00 as special and General Damages inclusive of the N30,000.00 deposit made to 1st respondent.

There is no doubt that the 1st respondent has committed a breach of contract by refusing to perform his own obligations under the contract whereas the appellant has carried out his own side of the contract by making payment. The appellant is therefore entitled to Damages.

I am of the view that this court is in good position to make inferences from evidence on record to enable it make proper findings and grant the appellant damages to which he is entitled See the cases of Fashanu v Adekoya (1974) 1 All NLR (pt 1) 35 and Ogunleye v Oni (1990) 2 NWLR (pt 135) 745 at 783. I am therefore making an appropriate award of damages in favour of the appellant judging from the exhibits and receipts tendered in the case. This will however be in the alternative.

On the final analysis this appeal succeeds and the judgment of the Akure High Court delivered on 3/12/90 in Suit No AK/34/86 is hereby set aside and in its place the following judgment is entered in favour of the appellant. The 1st respondent is hereby ordered to do all that is necessary under the law to obtain the consent of the Governor of Ondo State enabling the grant to the appellant a certificate of Occupancy in respect of the said piece or parcel of land as contained in Survey Plan No OG53/B/71 attached to the Deed of Conveyance dated 19th December 1972 and registered as 43/43/1451 at Ibadan now kept at Akure within 60 days from the date of this judgment.

The appellant is to pay to the respondent the balance of N20,000.00 as purchase price of the said property within the same 60 days from the date of Judgment.

In the alternative the respondent is ordered to pay the appellant the sum of N500,000.00 as special and General Damages inclusive of the N30,000.00 deposit made to the 1st respondent. Appeal against 2nd respondent is struck out the appellant having withdrawn against the Bank.

1st respondent is to pay N2,000.00 costs to appellant.

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