In The Court of Appeal of Nigeria
On Wednesday, the 13th day of June, 2018
Before Their Lordships
CHINWE EUGENIA IYIZOBAJustice of The Court of Appeal of Nigeria
HARUNA SIMON TSAMMANIJustice of The Court of Appeal of Nigeria
NONYEREM OKORONKWOJustice of The Court of Appeal of Nigeria
ENGR. EMMANUEL UDEDIKEAppellant
ENGR. (MRS) HAPPINESS UFOMADURespondent
CHINWE EUGENIA IYIZOBA, J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of Ogun State High Court Ota Judicial Division in Suit No HCT/96/09 delivered on the 25th day of June, 2012 Coram A. A. Babawale J.
The facts leading to the institution of this suit as summarized in the Appellants brief of argument are as follows:
Sometime in 2006, the claimant through his agent offered in a letter dated 16th December, 2006 to sell his one story building of 4 flats of 3 bedrooms each situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu-Berger, Ogun State to the defendant for N20,000,000 (Twenty Million Naira). In addition the said letter contained agency fee of 5% of the total consideration.
The defendant made a counter offer to purchase the property for N15, 000,000, rejecting the agency fee clause and introducing a new clause for vacant possession.
Being a radical departure from the terms offered by the claimant, the claimant unequivocally rejected the conditions in the defendant’s counter offer.
Sequel to the rejection of the defendant’s counter offer by the claimant, the defendant made a fresh offer in a letter dated 14th February, 2007 wherein she offered to pay the sum of N16,500,000 (Sixteen Million Five Hundred Thousand Naira) for the property. She further dropped her request for vacant possession and also changed her initial stance on payment of agency fee and offered to pay 3% of the total consideration as agency fee. She also offered to pay the proposed purchase price in three tranches with the last payment being on or before 30th October, 2007.
Being satisfied with the defendant’s terms of offer as contained in her letter of 14th February, 2007 the Claimant through his agent accepted the terms therein via a letter dated 20th February, 2007. The said letter of 20th February, 2007 further emphasized that neither possession nor ownership of the claimant’s property shall pass to the defendant until the defendant had fully paid the purchase price of N16.5m in accordance with the terms stipulated in her letter of 14th February, 2007,
Being satisfied and having accepted the terms stated in the Claimant’s letter of 20th February, 2007 and there being a consensus ad idem on those terms, the defendant in a bid to perform her contractual obligation under the contract informed the claimant that she needed a loan of N20million from her company to enable her pay the purchase price of the claimant’s property. Premised on this request the Claimant bona fide released to the defendant the original Certificate of Occupancy in respect of his property and also signed a deed of assignment solely to enable the defendant procure the loan.
On receiving the loan the defendant made a part payment of N14 million to the claimant and promised to pay the balance of N2.5 million of the agreed N16.5 million purchase price in two instalments of N1m and N1.5m with post-dated cheques for 30th July, 2007 and 30th October, 2007, respectively.
Barely two weeks after the defendant had made the aforesaid part payment of N14million, the defendant in an apparent assertion of possession and ownership of the claimant’s property summoned her co-tenants in the claimant’s property and informed them that she had purchased the claimant’s property; hence, they should vacate the property forthwith. Every effort made by the Claimant through his agent to call the defendant to order and to get her mellow down her rash assertion of her false land ladyship proved abortive as she succeeded in terrifying two of her co-tenants away from the claimant’s property without the claimant’s permission and consent.
The Claimant presented the defendant’s cheque of 30th July, 2007 for payment, the said cheque was returned unpaid to the claimant. On being informed about this development, the defendant remorselessly maintained that she stopped the payment of the cheque because she was not given vacant possession.
Despite several demands by the Claimant for the full payment of the purchase price, a condition precedent to vacant possession, the defendant adamantly and obdurately refused to make the payments as agreed and within the stipulated time in the contractual terms stated in the letters of 14th February, 2007 and 20th February, 2007.
Due to the defendant’s persistent breach of her obligation to pay the full purchase price for nearly two years, the claimant (now appellant) was constrained to commence this suit against the defendant seeking the reliefs set out in his Amended Statement of Claim.
The Respondents version of the facts differed. In her brief of Argument, she summarized her version thus:
The Claimant/Appellant by way of an offer to the Defendant/Respondent offered the Defendant/Respondent the sale of his property at No. 3, Kayode Anifowoshe Street, River Valley Estate, Ojodu-Berger, Ogun State. The Claimant/Appellant offer letter to the Defendant/Respondent was dated 16th December, 2006 and marked Exhibit DE1. Following the Claimant/Appellant letter, the Defendant/Respondent forwarded a response vide her letter of January, 8th 2007 which was admitted and marked Exhibit DE2. In her correspondence, the Defendant/Respondent requested that the Claimant/Appellant deliver vacant possession of the property to her as a pre-condition for the consummation of the transaction. Meanwhile, it is important to emphasize at this point that the Defendant/Respondent was one of the 4 (four) tenants on the property at the time this negotiation was in progress. Therefore her demand or request to have vacant possession of the property was genuinely born out of the fact that she would not anticipate any post transaction issues with the other tenants on the property.
Interestingly, the Claimant/Appellant did not object or decline or turn down the request made by the defendant/Respondent. The Claimant/Appellant through his Agent Barrister Fes Eke Eze of ONUZURUIKE Law Chambers (the counsel currently prosecuting this Appeal for the Claimant/Appellant in this Appeal) did not by way of any correspondence reject the issue of vacant possession raised by the Defendant/Respondent in her letter of January 8th 2007. Rather, there was an oral confirmation or assurance by the said Agent acting on behalf of the Claimant/Appellant that the Defendant/Respondent shall have vacant possession of the property on or before 30th October, 2007 when the rent of the last tenant on the property would have expired.
This profound assurance made the Defendant/Respondent to apply for the loan from her Bank, Eco Bank PLC for the sum of N20,000,000.00 (Twenty Million Naira only) to the knowledge of the Claimant/Appellant and thereafter made a deposit sum of N14,000,000.00 (Fourteen Million Naira only) to the Appellant leaving a balance of the sum of N2,500,000.00 (Two Million Five Hundred Thousand Naira only) to be paid between 30th July 2007 and 30th October, 2007 in the sum of N1,000,000.00 (One Million Naira only) and N1,500,000.00 (One Million Five Hundred Thousand Naira only) respectively. Again the structured payment was based on the assurances of the Claimant/Appellant through his agent that the Defendant/Respondent shall have vacant possession of the property when the last tenant on the property would have vacated on the 30th October, 2007. In fact the sum of N16,500,000.00 (Sixteen Million Five Hundred Thousand Naira only) which was agreed as the purchase price between the Claimant/Appellant and the Defendant/Respondent was communicated via the Defendant/Respondent letter of 14th February, 2007 as a follow-up of her letter of January 8th 2007. Between January 8th and February 14th 2007 there was no written correspondences between the Claimant/Appellant Agent or Defendant/Respondent until 20th February, 2007 when the Claimant/Appellant through his agent aforesaid communicated to say he had accepted the sum of N16,500,000.00 as the purchase price of the property. As earlier pointed out, the sum of N14,000,000.00 (Fourteen Million Naira) was paid by the Defendant/Respondent to the Claimant/Appellant pursuant to a loan obtained by the Defendant/Respondent and to which the Claimant/Appellant is aware of because the cheque for the loan was issued in favour of the Claimant/Appellant who later returned the sum of N6,000,000.00 to the Defendant/Respondent and leaving a balance of N2,500,000.00 on the purchase price aforesaid and structured in accordance with the tenants expiry dates. The sum of N30, 000 was paid to the Claimant/Appellant as Bank charges (C.O.T.) for clearing the cheques for procuring the loan by the Defendant/Respondent. (Pages 86 89 of the Records) Exhibits DE5, DE6, DE7 and DE8. The sum of N14,000,000.00 have been paid by the Defendant/Respondent since April, 2007 on the property.
The Defendant/Respondent discovered the non-disclosure of a vital fact on vacant possession after payment of the sum of N14, 000,000.00 had been made that one of the tenant (Richwell Plaza managed by Mr. Patrick Obiorah) had actually paid rent on the property until 2010 and that vacant possession cannot be delivered to the Defendant/Respondent until after 2010. The Defendant/Respondent was naturally taken aback by this misrepresentation. In fact, up till this moment following the settlement of the Respondent Brief of Argument, the tenant Richwell Plaza is still on the property. Even while giving evidence at the lower Court in 2011, the Claimant witness (CW2) Barrister Fes Eke Eze admitted that Richwell Plaza Limited was still their tenant on the property and its tenancy subsisted till the time he gave evidence. (Page 284 records). The situation remains the same till date.
By his Amended Statement of Claim dated 18/11/10 and filed on 23/11/10, the Claimant/Appellant claimed against the Defendant/Respondent as follows:
1. A DECLARATION that the defendant is in breach of the contract of sale of the claimant’s one story building of four (4) 3-bedroomm flats situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu Berger, Ogun State.
2. A DECLARATION that the claimant is at all material time the person entitled to possession and accruable rents in respect of the said building subject matter of the contract of sale between the claimant and defendant, the defendant having defaulted in the payment of the balance of purchase price.
3. A DECLARATION that the defendant is at all material time a tenant of the claimant liable to pay rent to the claimant at the rate of N250,000 per annum in respect of three (3) flats with effect from 1st January, 2007 till judgment is delivered having been possession of the said flats since 2007.
4. AN ORDER for rescission of the contract of sale between the claimant and the defendant in respect of the claimant’s one story-building situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu-Berger, Ogun State.
5. AN ORDER compelling the defendant to return the original Certificate of Occupancy No. 00012335 in respect of the said claimant’s property to the Claimant’s bank, Afribank Nigeria PLC for which the said claimant’s bank will issue a bank cheque of N14,000,000 in favour of the defendant via defendant’s bank, Eco Bank Nigeria PLC.
5a. AN ORDER compelling the defendant to return to the claimant all the documents transferred to her in respect of the said claimant’s building situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu Berger, Ogun State.
5b. AN ORDER compelling the defendant to deliver possession of the three (3) flats in the one story building situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu Berger, Ogun State to the claimant.
5c. AN ORDER setting aside the Governor’s consent fraudulently procured by the defendant in respect of Claimant’s property situate at No. 3 Kayode Anifowoshe Street, River Valley Estate, Ojodu Berger, Ogun State vide another forged deed of assignment dated 25th August, 2009 registered as 12/12/708 while the matter herein was already pending in Court.
6. AN ORDER of perpetual injunction restraining the defendant, her legal personal representatives, agents, privies and whosoever claiming through her from exercising any rights of ownership on the said claimant’s building.
7. The sum of N2, 000,000 (Two Million Naira) being general damages against the defendant.
8. The cost of this suit.
The Defendant/Respondents further Amended Statement of Defence/Counterclaim is at pages 183 to 189 of the Record of Appeal. She denied the claims of the Appellant and counterclaimed as follows:
A. N3, 600,000.00 representing two years rent for No. 3 of 3 bedroom flats in the above named property subject matter of this suit.
B. N2, 000,000.00 general damages against the claimant for breach of contract.
C. The Defendant also claims cost of this action.
The Appellants Reply to the Statement of Defence and defence to counterclaim is at pages 90 to 106 of the Record. After close of pre-trial conference, the matter went to trial. Trial commenced on 12th May, 2011 with the Claimant calling two witnesses and the Defendant one witness. On 26th April, 2012 parties adopted their final written addresses. The trial Court in its judgment delivered on the 25th of June, 2012 granted the Appellants claim by declaring the Respondent in breach of the contract of sale of the property by her failure to pay the outstanding purchase price of N2.5 million but held that the breach was not so serious as to entitle the Appellant to a rescission of the contract of sale of the property. All the other claims of the Appellant and the counterclaims of the Respondent were dismissed. Dissatisfied with the judgment, the Appellant appealed by Notice of appeal dated 26/06/12 and filed on 27/06/12 at pages 293 295 of the Record.
It was subsequently amended by an order of the Court. From the three grounds of appeal in the Amended Notice of Appeal filed on 23/11/16 the appellant distilled the following issues for determination:
1. Whether a vendor is entitled to the remedy of rescission of the contract of sale of property where a purchaser fails to fully pay the purchase price of the property (distilled from Ground One).
2. Whether the allegation that the document used by the respondent to procure the Governor’s consent was tainted with fraud was not proved on the totality of the compelling evidence before the trial Court (distilled from Ground Two).
3. Whether refusal by the purchaser to fully pay the purchase price of property goes to the root of the contract thereby entitling the vendor to the rescission of the contract (Distilled from Ground Three).
The Respondent on her part also set out three issues for determination which are in pari materia with the issues formulated by the appellant as set out above. In other words, the Respondent by the issues set out adopted the issues formulated by the Appellant.
1. Whether a vendor is entitled to the remedy of rescission of the contract of sale of property where a purchaser fails to fully pay the purchase price of the property (distilled from Ground One).
On this issue, learned counsel for the Appellant Fes Eze Eke Esq., relying on the cases ofODUSOGA V. RICKETTS(1997) 7 NWLR (PT. 511) 1 @16; MANYA V. IDRIS (2001) 8 NWLR (PT. 716) 627 @ 637; ODUFUYE V FATOKE (1977) 4 SC 11 submitted that where a purchaser of land made part-payment of the purchase price but defaulted in paying the balance there can be no valid sale even where the purchaser is in possession as such possession is incapable of defeating the vendor’s title. Learned counsel submitted that the trial Judge at page 290 of the Record found as a fact that both parties agreed that possession of the building shall be upon full payment of the purchase price in the following words:
In the case of the defendant, she was promised possession upon payment of the full purchase price. She failed to allow the claimant manifest his full intention before she stopped the payment of the balance.
Learned counsel quoted Ayo Salami JCA (as he then was) in MANYA V. IDRIS (SUPRA) thus:
The appellant herein made a part payment of the purchase price of land but refused to tender the balance in spite of several demands or extension of the stipulated time within which to pay the outstanding balance. The appellant’s refusal to pay up the remaining purchase price is FATAL to his acquisition of the land because he is not entitled to title to the property until the purchase price is fully paid notwithstanding his possession.”
at page 638:
At common law, payment of purchase price as well as possession vests the purchaser with equitable interest on the basis of which he can seek an order of specific performance. But where the purchaser fails to pay the purchase price FULLY he will have no right to a decree for specific performance. THERE WILL THEN BE A RIGHT IN THE VENDOR TO RESCIND THE CONTRACT OF SALE AND RESELL THE PROPERTY.”
“… the respondent should have exercised his lien over the property and resell and convey the property to any other person who might be desirous of buying the premises. He does not have to resort to the expensive and long process of litigation to recover the land in dispute or the balance of the purchase price.
Learned counsel submitted that the learned trial Judge was manifestly in error to have refused to apply the above decision in the instant case thereby occasioning miscarriage of justice. Counsel also referred to MUSTAPHA V. ABUBAKAR & ANOR (2011) 3 NWLR (PT. 1233) 123 @ 146, which he claimed was similar to the instant case except that it was the erring purchaser who had sued for specific performance. There, the Court of Appeal Kaduna Division, per Orji Abadua (JCA) held as follows:
Similarly, where the buyer refuses to proceed with the contract in such circumstances as to amount to a repudiation or discharging breach, the seller may resort to the equitable remedy of specific performance or he may treat the breach as discharging the contract, forfeit any deposit but restore any payments made on account of the purchase price, and proceed to deal with the property as he desires. The seller may also sue for damages. THEREFORE, WHERE THE PURCHASER WHO HAD MADE A PART PAYMENT OF THE PURCHASE PRICE IS IN DEFAULT OF PAYMENT OF THE BALANCE, THERE IS RIGHT IN THE VENDOR TO RESCIND THE CONTRACT OF SALE AND RE-SELL THE PROPERTY.”
Learned counsel quoting Ogbuagu JSC in CHABASAYA V. ANWASI (2010) 10 NWLR (PT. 1201) 163 @ 187 submitted that the learned trial Judge ought to have given effect to the contract of the parties by holding that failure by the respondent to pay the balance of the purchase price on 30th October, 2007, as willingly agreed by the parties, entitled the appellant to rescission of the contract especially as the Appellant showed and indeed pleaded willingness and readiness to refund the part payment made by the purchaser. Counsel cited BEST (NIG.) LTD V. BLACKWOOD HODGE (NIG.) LTD & 2 ORS (2011) 1-2 S.C.(PT. L) 55 @ 74 & 75 where the Supreme Court refused to order specific performance where the purchase price was paid in full for a property in Burma Road, Apapa, Lagos but the purchaser failed to pay the consent fee (withholding tax) as agreed by the parties. The Supreme Court held that mere refusal of the purchaser to pay consent fee after full payment of purchase price is a breach of the material term of the contract and that the breach gives the aggrieved party a lee-way or an excuse for non-performance of its own side of the bargain. Learned counsel posed the question whether in the absence of a contrary intention, possession could precede payment of the full purchase price? He submitted that since the learned trial judge has found as a fact that full payment of the purchase price must be made before possession, that the respondent failed to make full payment of the purchase price and therefore has no right to demand for possession of the subject property or to use the issue of possession to stop the cheques of N1m and N1.5m earlier issued by her. Counsel submitted that the learned trial judge ought to have viewed the failure by the respondent to pay the outstanding sum of N2.5M as a fundamental breach of the contract entitling the Appellant to rescind the contract of sale.
Whether the allegation that the document used by the respondent to procure the Governor’s consent was tainted with fraud was not proved on the totality of the Compelling evidence before the trial Court (Distilled from Ground Two).
Learned counsel faulted the conclusion of the learned trial judge that the Appellant failed to establish his claim that Exhibit CE19 the registered Deed of Assignment was forged. He cited the dissenting judgment of Nsofor JCA in BUHARI V. OBASANJO (2005) 2 NWLR (PT. 910) 241 AT 505, as to what is meant by fraud in equity. Counsel reproduced the Appellants averments in paragraphs 11 & 11a of his Amended Statement of Claim. He referred to Exhibits CE19, CE20 and CE21 and submitted that Exhibits CE19 and CE21 are clearly shown to be forged. He argued that the purported Governor’s consent predicated upon such fraud is liable to be set aside. Learned counsel argued:
The question, My Lords, is does it not affront the sense of justice that Your Noble Lords are being called upon to uphold a Governor’s consent procured with documents fraught with clear fraud and illegality with the sole motive of denying the Ogun State Government its much needed revenue for its developmental projects? Did equity not emphasize that he who comes before it must come with clean hands? Exhibit CE 21 has no consideration at all on the face of it while Exhibit CE 19 has N10million naira consideration thereon as the purchase price of the property, subject matter of this suit whereas,
it is a common ground between the parties that the purchase price of the property is N16.5million naira…………
He cited the case of SHOBAJO V. IKOTUN (2003) 14 NWLR (PT. 840) 237 @ 257-259 which highlighted the following principles:
1. Equity will not allow the law to be used as an instrument of fraud. Otherwise the society will reproachfully ask equity “Why did you stand by and watch the law being used as an engine of fraud when it is your cardinal duty to temper and moderate the law?
2. Wrongful acts are no passport to favour as no one is allowed to take advantage of his own wrong. (In the instant case the defendant/respondent pulled wool over the eyes of the Governor of Ogun State by misrepresenting the amount of consideration for the property so as to pay a paltry sum as revenue to the state and this unconscionable act is what Your Lordships are herein called upon to endorse, God forbid!)
3. Where fraud is established (as in the case now before Your Lordships) the property transaction by which the purchaser bought the legal estate is cancelled by equity because the eyes of equity are too holy to behold fraud.
4. Moral obliquity and failure to maintain certain established moral standards (such as the deliberate deleting of the amount of consideration by the defendant/respondent, in the instant case, from Exhibit CE19 so as to deprive the Ogun State Government the amount of revenue it ought to derive from such property transaction) are decreed against in our society.
5. Finally, he who must come to equity must do so with clean and unsoiled hands. In the instant case, the hands of the defendant/respondent are enmeshed in fraudulent misrepresentation which has effectively robbed the Ogun State Government of millions, yes millions of naira in revenue.”
He urged the Court to resolve this issue in favour of the appellant.
Whether refusal by a purchaser to fully pay the purchase price of property goes to the root of the property contract thereby entitling the vendor to the rescission of the contract (Distilled from Ground Three).
Learned counsel for the Appellant on issue 3 relying on the cases of BEST (NIG) LTD V. BLACKWOOD HODGE (NIG) LTD & 2 ORS (SUPRA) @ 74 AND 75; ODUSOGA V. RICKETTS (SUPRA);Â CHABASAYA V. ANWASI (SUPRA); MANU V. IDRIS (SUPRA) AND MUSTAPHA V. ABUBAKAR (SUPRA) submitted that the intentional refusal/failure to tender full payment of purchase price of property is a breach that strikes at the very root of the property contract thereby entitling the vendor to either seek the equitable remedy of specific performance or the rescission of the contract. Learned counsel submitted that by electing to rescind the contract as in this case, authorities abound that the vendor can even resell and convey the land to another interested buyer. Learned counsel submitted that the learned trial judge after accepting Exhibits CE14 and CE15 as ensconcing the terms of the contract between the parties and that the respondent was entitled to possession on payment of the full purchase price of N16.5 Million, was wrong in holding that the payment of N14m and refusal to pay the balance of N2.5m was not such fundamental breach of the contract as would entitle the Appellant to rescind the contract. Counsel submitted relying on JFS INVESTMENT LTD V. BRAWAL LINE LTD & 2 ORS. (2010) 12 S.C. (PT.) 110 @ 162 AND A.G. RIVERS STATE V. A.G. AKWA IBOM STATE & ANOR (2011) 3 S.C. 1 @ 226 that parties are bound by the terms of contract they freely entered into.
WHETHER A VENDOR (THE APPELLANT) IN A CONTRACT OF SALE OF PROPERTY IS ENTITLED TO THE REMEDY OF RESCISSION OF THE CONTRACT WHERE A PURCHASER FAILS TO FULLY PAY THE PURCHASE PRICE OF THE PROPERTY.
Solomon A. Imosemi Esq., for the Respondent in his brief submitted that the actual fundamental breach was the failure of the Appellant to deliver vacant possession as promised. He argued that the cases of ODUSOGA VS RICKETTS (SUPRA) and MANYA VS IDRIS (SUPRA) referred to by learned Appellant???s counsel are distinguishable from the current Appeal. He opined that in the instant case, there was never a time the Appellant made specific demand for the balance of the sum of N2, 500,000.00 (Two Million Five Hundred Thousand Naira) after the circum- stances of the disagreement between the Appellant and the Respondent occurred. Counsel submitted that in all the cases including ODUFUYE VS FATOKE (SUPRA) the Court observed that specific demands were made through communication for the payment of the balance of the purchase sum and the defaulting parties in the cases had refused to pay the balance. Counsel submitted that in the instant case, the Respondent was aware that there was an outstanding sum of N2,500,000.00 (Two Million Five Hundred Thousand Naira) pending on the transaction, but that the Appellant was in fundamental breach regarding one of the tenants on the property (Richwell Plaza) who is currently still on the property till date. Counsel argued that the Respondent had always been willing to pay the balance of the sum of N2,500,000.00 right from inception hence the issuance of the postdated cheques for 30th July 2007 and 30th October, 2007. He submitted that fundamentally the issue of vacant possession was critical to the totality of the contract between the Appellant and the Respondent in the suit which was amplified through correspondences, words and conduct of the parties in the suit. He submitted that the trial Judge in his judgment indicated that he believed the Defendant/Respondent in her claim that the payment of the future installments were structured to coincide with the period when the then valid tenancies on the property would lapse.
Counsel submitted that given the current circumstances of this case, the Appellant cannot be entitled to rescind the contract for the sale of the property. He further submitted that it is the Claimant/Appellant that is guilty of a fundamental breach of the purchase Agreement. He opined that this is captured in the Appellants deliberate misrepresentation of facts regarding delivery of vacant possession. He referred to the evidence of CW2 under cross-examination that Richwell Plaza was still their tenant on the property and that its tenancy subsists even as at the time he gave evidence in 2011. He submitted that CW2 testified under further cross examination That the last tenancy was to expire in December 2007 whereas the Respondent had anticipated upon oral assurances communicated to her by the said Agent of the Appellant to reinforce the Respondents letter of January 8th, 2007 that full possession would be delivered by 30th October 2007. Counsel submitted that the discovery that possession would not be granted to the Respondent (a fact corroborated by CW2 under cross-examination) at page 284 of the records was what gave rise to the fundamental breach in this suit. Counsel urged us to resolve this issue in favour of the Respondent.
WHETHER THE ALLEGATION THAT THE DOCUMENT USED BY THE RESPONDENT TO PROCURE THE GOVERNORS CONSENT WAS TAINTED WITH FRAUD WAS NOT PROVED ON THE TOTALITY OF THE COMPELLING EVIDENCE BEFORE THE TRIAL COURT.
Learned counsel submitted that Exhibit CE19 the Deed of Assignment was voluntarily executed by the Appellant and subsequently forwarded to the Lands Registry Office Oke – Elewo Abeokuta where the Governors consent was processed and obtained. Counsel submitted that the allegation of forgery of Exhibits C19 and C21 being criminal in nature must be proved beyond reasonable doubt. Counsel submitted that the ground of the alleged forgery by the Respondent was that there was a consideration of N10million on Exhibit CE19 instead of the N16.5m agreed upon. Counsel argued that Exhibits CE19 and CE21 are documents voluntarily executed by the Appellant in favour of the Respondent to enable the latter procure the loan facility from her Bank Eco Bank Plc in respect of this transaction. Learned counsel referred to the findings and evaluation of the learned trial Judge on the evidence led by the parties on the issue and submitted that the trial judge rightly held that there was nothing from his careful observation of Exhibit C19 to suggest that the consideration was deleted and a lower figure inserted by the Respondent. Citing the cases of EGONU VS EGONU (1978)1112 SC, 111; WOLUCHEM VS GUDI (1981) 5 SC. 291 and OBODO VS OGHA (1987) 2 NWLR (PT 54) 1;
Learned counsel submitted that by the very nature of the allegation of the Appellant against the Respondent, the standard of proof required from the Appellant in the circumstances of this case is beyond reasonable doubt. He opined that the Appellant did not by way of evidence invite or subpoena an officer from the Land Registry Oke – Elewo Abeokuta to substantiate or prove the allegation of fraud with regard to Exhibit CE19 or CE21. He argued that the Appellant himself did not give any evidence during trial to say that his signature was forged; rather he admitted that he executed the Deed of Assignment to enable the Respondent obtain loan from the Bank. He submitted that the Appellant in fact voluntarily surrendered his title documents namely his Certificate of Occupancy to the Respondent to facilitate the transaction. Counsel submitted that the cases of SHOMEFUN VS SHADE (SUPRA) AND BUHARI VS OBASANJO (SUPRA) cited by the Appellant are profoundly distinguishable from the instant suit. He argued that in the instant suit the Appellant voluntarily participated in the necessary documentation that led to the processing of Exhibit CE19 at the Lands Registry Abeokuta without which the Governors consent would not have been obtained. He submitted that the Appellant voluntarily executed Form 1C (an administrative document at Lands Registry Abeokuta) with his passport photograph attached, a preliminary step which sets in motion the process for obtaining the Governors consent. Counsel submitted that the Appellants allegation of fraud at the completion of the process was a mere afterthought. He urged the Court to discountenance the totality of the Appellants argument on this issue as lacking in merit.
Learned counsel submitted that issue 3 purportedly distilled from ground 3 of the Amended Notice and grounds of Appeal does not arise from the ground.
Counsel set out ground 3 of the Amended Notice and grounds of Appeal:
The learned Judge misdirected himself when he stated thus:
The type of breach in this case is that which can be compensated by the award of damages. This is more so in the circumstances of this case where the refusal of the Defendant was not merely wilful but based on the failure of the Claimant to deliver vacant possession of the property to her.”
He urged the Court to completely discountenance issue three and argument canvassed thereon as it is settled law that any issue for determination in an Appeal which does not arise from or relate to a ground of Appeal is incompetent and liable to be struck out. In support counsel cited and relied on the following cases: ONYESOH VS. NNEBUNDUN (1992) 3 NWLR (PT. 227) 315; KALU VS ODILI (1992) 5 NWLR (PT. 240) 130; UGO VS OBIEKWE (1989) 1 NWLR (PT. 99) 566; AGU VS. IKEWIBE (1991) 3 NWLR (PT. 180) 385.
Learned counsel however conceded that issue three is properly derivable from ground one of the Amended Notice of Appeal which has been addressed extensively in the Respondents brief.
Counsel urged us to strike out ground 3 as abandoned since no issue was formulated there from. He referred to the observation of Adekeye JSC in MINI LODGE LIMITED & ANOR. VS. CHIEF OLUKA NGEI (2010) 10 WRN 56, 66 RATIO 9. Counsel submitted that given the circumstances of this case, the observation was profoundly persuasive and meets the equity of this case. He urged us to dismiss the appeal and affirm the judgment of the lower Court.
The Respondent in his brief of argument raised a preliminary objection as to the competence of ground 3 of the Notice and grounds of appeal and issue 3 distilled there from. Mr. Fez Eke in his Reply brief submitted that the objection is incompetent as Respondent failed to comply with Order 10 Rules 1 & 3 of the Court of Appeal Rules 2016. Order 10 Rules 1 & 3 provide:
A respondent intending to rely upon preliminary objection to the hearing of the appeal, shall give the appellant 3 clear days notice thereof before the hearing, setting out the grounds of objection and shall file such notice together with twenty copies thereof with the registry within the same time.
Where the Respondent fails to comply with this Rule, the Court may refuse to entertain the objection or may adjourn the hearing thereof at the cost of the Respondent or may make such order as it thinks fit.
Mr. Eke urged the Court to refuse to entertain the objection and to discountenance same. The requirement of giving the Appellant 3 clear days notice applies where the objection is as regards the hearing of the appeal. Here the Respondent is merely asking us to discountenance or ignore issue 3 formulated by the appellant claiming that the issue as argued is radically different from the ground 3 from which it was purportedly distilled. He is not objecting to the hearing of the appeal. Failure to give the Appellant 3 clear days notice is consequently of no moment. Even if the objection is to the hearing of the appeal, it is clear from the provisos that it is a matter completely at the discretion of the Court as to what order to make. Whenever the Appellant suffered no miscarriage of justice by the failure to give him the relevant notice and he had time and duly responded to the objection as in the instant case, the default will be ignored by the Court.
Even where the Appellant failed to file a Reply brief in response to the preliminary objection in the Respondents brief, but service was effected on him within sufficient time for him to have filed his Reply the Supreme Court in the case of UMANA JNR VS. NDIC (2016) LPELR-42556(SC) held that the default will be ignored and the preliminary objection heard. Now to the objection; Ground 3 of the Appellants amended Notice of Appeal and its particulars are as follows:
The Learned trial judge misdirected himself when he stated thus:
The type of breach in this case is that which can be compensated with the award of damages. This is more so in the circumstance of this case, where the refusal of the defendant was not merely wilful but based on the failure of the claimant to deliver vacant possession of the purchased property to her.”
PARTICULARS OF MISDIRECTION
(a) The respondent committed a breach of a term of the contract between her and the appellant by her failure to pay the outstanding sum of N2.5m as found out by the learned trial judge.
(b) A breach of a term of a contract entitles the innocent party to sue either:
(i) For specific performance and damages or
(ii) Rescission of the contract and damages.
(a) The stage for the delivery of vacant possession of the subject matter of this case had not reached by the time the respondent committed a fundamental breach of the contract as found by the learned trial judge.
(b) There was no evidence before the learned trial judge that the appellant was incapable of delivering vacant possession of the property to the respondent if the respondent had performed her own part of the contract fully.
(c) Exhibit CE15 which the learned trial judge accepted as the basis of the contract specifically stated that possession shall not pass to the respondent until full payment of the purchase price has been made.
(f) There was no basis for asking for vacant possession or in fact possession of the property since full payment has not been made.
The appellants issue 3 distilled from ground 3 above reads:
Whether refusal by the purchaser to fully pay the purchase price of the property goes to the root of the contract thereby entitling the vendor to the rescission of the contract.”
The above Ground 3 of the amended Notice of Appeal, its particulars and issue 3 formulated there from are quite clear and comprehensible. No one will be confused about the complaint of the Appellant as contained therein. The only problem is that it so overlaps with Ground 1 that it appears superfluous. The ground, the particulars, and issue could easily have come under Ground 1 and the issue formulated there from.
In the case of OLAKSANDR V LONESTAR DRILLING CO. LTD (2015) 9 NWLR (PT. 1464) 337 AT 396-397 cited by Mr. Eze, NWEZE JSC in Paras F-D observed:
???A ground of appeal and its particulars must be couched to ensure that the adverse party who reads same must not be left in any doubt as to what the appellant???s complaint is. However, where the parties to an appeal and the Court are not misled by the contents of a ground of appeal, the inelegance of the ground of appeal or its particulars would not invalidate the ground of appeal.”
The Respondents complaint is consequently mere technicality which did not occasion a miscarriage of justice. The problem can be taken care of by dealing with issues 1 & 3 together. The objection is lacking in merit and is overruled.
Before dealing with issues 1 & 3, I shall quickly dispose of issue 2. The contention of the Appellant on issue 2 is that the learned trial judge erred in coming to the conclusion that the allegation of forgery of Exhibit CE19 was not established. He argued that Exhibit CE 21 has no consideration at all on the face of it while Exhibit CE 19 has N10 Million naira consideration instead of the actual purchase price of N16.5 Million naira. Exhibit CE19 is the Deed of Assignment between the Appellant and the Respondent. It is not contended that the Deed was not executed by the Appellant before it was forwarded to the Lands Registry Office Oke – Elewo Abeokuta where the Governors consent was processed and obtained on the application of the Appellant. The appellant signed all the necessary forms for the Governors consent and provided his passport picture. The allegation of forgery by the Appellant against the Respondent is criminal in nature and must be proved beyond reasonable doubt. The learned trial Judge on the issue at 286 287 of the Records found as follows: the submission that Exhibit CE19 and CE21 were forged documents was not established at all before me. I agree with the submission of the Defence counsel that the allegation of forgery which bothered on crime must be proved beyond reasonable doubt even if made in a civil matter. The mere fact that the consideration stated in Exhibit CE19 (the registered Deed of Assignment) was N10m whereas the actual consideration that the parties agreed upon was N16.5m does not make the document a forgery. As rightly submitted by the Defence counsel, Claimant voluntarily executed the document, albeit Claimant stated that he executed it in order to enable the Defendant obtain the loan from her Bank. I have had a good look at Exhibit CE19 and contrary to the submission of the Claimant counsel, there is nothing to suggest that the consideration was deleted to insert the lower consideration stated therein.”
This finding of the learned trial Judge cannot be faulted. The Appellant had tendered Exhibits CE19, CE20 and CE21 and averred in his pleadings that Exhibits CE19 and CE21 were altered by the Respondent. In his address at page 219 of the Record counsel claimed that the Appellant never appended his signature to the documents but the claim is not supported by the evidence led at the trial. The Appellant did not lead evidence during the trial that his signature on Exhibits CE19 and CE21 were forged. On the contrary, he admitted that he executed the Deed of Assignment to enable the Respondent obtain loan from the Bank. He also voluntarily surrendered his title document, his Certificate of Occupancy to the Respondent to facilitate the registration of the transaction. There is no clear evidence that the alteration of the consideration in Exhibit CE19 was done by the Respondent or without the consent of the Appellant. The Appellant voluntarily participated in the necessary documentation that led to the processing of Exhibit CE19 at the Lands Registry Abeokuta. Form 1C (an administrative document at Lands Registry Abeokuta) was voluntarily executed by the Appellant with his passport photograph voluntarily attached. Without his participation, the Governors consent would not have been obtained. I am in agreement with learned counsel for the Respondent that the allegation of fraud was an afterthought conceived to undermine the case of the Respondent. The learned trial Judge is right that the Appellant failed to discharge the burden of proof placed on him by law to substantiate the allegation of fraud. It is not enough to allege that the Governors consent was procured with documents fraught with clear evidence of fraud and illegality with the sole motive of denying the Ogun State Government its much needed revenue. There must be evidence which proves beyond reasonable doubt that it was the Respondent who committed the act giving rise to the fraud. In the case of ADIMORA V AJUFO & ORS (1988) LPELR-182 (SC) OPUTA JSC observed:
Fraud implies a wilful act on the part of anyone, whereby another is sought to be deprived, by illegal or inequitable means, of what he is entitled to. Fraud for the purposes of the civil law includes acts, omissions and concealment by which an undue and unconscientious advantage is taken of another:GREEN V NIXON (1957) 23 Beav 530 at p.535.
Proof beyond reasonable doubt means clear evidence that the Respondent was indeed responsible for the alleged forgery.
No such clear evidence was adduced. It was all mere speculation. The Respondent is right that it does not actually lie in the mouth of the Appellant given the role he played to make this allegation without any evidence from an officer or representative of the Ogun State Government and Land Registry Abeokuta. Issue 2 is resolved against the Appellant and in favour of the Respondent.
On issues 1 & 3, it seems well settled from a long line of authorities that in a contract for sale of land failure to pay the purchase price or part of the purchase price constitute a fundamental breach which goes to the root of the case and may give grounds for rescission of the contract of sale by the owner. See the following cases:ACHONU V OKUWOBI (2017) LPELR-42102(SC); NIDOCCO LIMITED VS. GBAJABIAMILA (2013) 6/7 SC (PT. 10) 92 OR (2013) LPELR-20899 (SC) NLEWEDIM VS. UDUMA (1995) 6 NWLR (PT. 402) 383; MANYA V. IDRIS (2001) 8 NWLR (PT. 716) 627; ODUFUYE V. FATOKE (SUPRA); ANWASI V CHABASAYA (2001) 1 NWLR (PT. 661) 408. This of course is a general statement of the law as it will all depend on the peculiar facts of each case.
In ACHONU V OKUWOBI (2017) LPELR-42102(SC), the purchase price for the property was N1, 500, 000.00. The purchaser accepted the offer and made part payment of N700, 000.00 in two instalments of N500, 000.00 and N200, 000.00 and was issued a receipt for the payment dated 3/6/92. She promised to liquidate the balance of N800.000.00 within one week. When she failed to honour the promise, the owner instructed his solicitors to write to her informing her that he would no longer sell the property because the project for which he needed the money from the sale of the property had been frustrated by her inability to pay the balance within the time agreed. The Court of first instance granted the purchaser an order of specific performance on the ground that there was a valid and subsisting contract of sale of which there was part performance. The Court of appeal however disagreed holding that time was of the essence and that there was no sufficient evidence justifying the order of specific performance. This view was upheld by the Supreme Court in the following words:
In the instant case, the purchaser, that is the appellant had failed to pay the balance of the purchase price at the expiration of the one week agreed upon by her and after extension of time and repeated demands for payment by the Respondent. The learned justices of the Court of Appeal were therefore justified when they quashed the trial Courts order for specific performance.
It will seem consequently that where there is a definite contract for sale of property and a substantial part of the purchase price paid, failure to pay the outstanding balance may not necessarily entitle the owner to rescind the contract where time is not of the essence; and where failure to pay the balance is as a result of some misunderstanding yet to be settled by the parties, and third party interest had in the interval come into play. This explains the reasoning behind the observation of Adekeye JSC in MINI LODGE LIMITED & ANOR. VS. CHIEF OLUKA NGEI (2010) 10 WRN 56, 66 RATIO 9 that:
In a contract for sale of property where part payment was paid, the law is that the contract for purchase has been concluded and is final leaving the payment of the balance outstanding to be paid. The contract for the sale and purchase is absolute and complete for each party can be in breach for non-performance and for which any action can be maintained for specific performance.”
The observation is correct to the extent that the contract of purchase is conclusive and that failure by either party to perform any of his obligations under the contract is a breach for which an innocent purchaser can sue for specific performance. He may not succeed if there are other reasons in the contract of purchase militating against an order of specific performance. In the same vein an innocent seller can also sue for specific performance or he may choose to rescind the contract of sale. Success again depends on the peculiar circumstances of the case. The observation cannot be construed to mean that the innocent seller can only sue for specific performance and cannot opt for his right to rescind the contract.
The learned trial Judge in the instant appeal rightly held that the Respondent was the one in breach of the contract of sale by failing to pay the full purchase price and not the Appellant for failure, as strenuously argued by the Respondent to surrender vacant possession. The Respondents insistence on this point is quite surprising in view of the contents of Exhibits CE14 and CE15. The importance of these two Exhibits call for reproduction of the relevant parts. Exhibit CE14 dated 14/2/2007 reads:
???RE: OFFER FOR PURCHASE OF PROPERTY KNOWN AS NO. 3 KAYODE ANIFOWOSHE STREET, RIVER VALLEY ESTATE, OJODU
Further to our discussion of February 12, 2007 and your offer letter of December 16, 2006, please confirm that the under-listed are the agreed terms and conditions for the purchase of the above
property. That is:
1. Price: N16.5 million NET
2. Agency: 3% of N16.5 million payable to Barrister Eke.
3. Payment Schedule:
a. N12.5 million payable on before 31 March, 2007.
b. 3% of N16.5 million payable along with the N12.5 million payment.
c. N2.0 million payable on before 31 July, 2007.
d. N2.0 million payable on before 31 October, 2007.
4. Original title documents (C of O) and evidence of payments of all statutory land charges and taxes at lands registry to be released upon payment of the N12.5 million deposit.
5. Post-dated cheques to be issued for payments 3(c) and 3(d) above.
Kindly acknowledge below or in writing that the above already discussed terms and conditions are acceptable to you.
Exhibit CE15 is the Reply to the above letter and is dated 20/2/2007. The relevant parts read as follows:
RE: NO. 3 KAYODE ANIFOWOSHE STREET, RIVER VALLEY ESTATE, OJODU
We refer to the above captioned matter and in particular your letter of 14th February, 2007 and hereby unequivocally state that any variation or deviation from the terms you stated in the aforesaid letter under reference shall automatically render void the entire sale transaction and any money or moneys paid by you to the vendor shall become refundable. For the avoidance of doubt, you must strictly keep to the schedule of payment and every term contained in your letter of offer of 14th February, 2007, failing which the entire sale transaction shall become null and void and of no effect.
Please note also that neither possession nor ownership of the said property shall pass to you until you have fully and effectively paid the agreed sum of =N=16.5m (Sixteen Million and Five Hundred Thousand Naira) to the vendor and kept to each and every term stated in your letter of 14th February, 2007 to us.
On our part, we shall ensure that every money meant for the vendor from you is passed to the vendor and where the sale transaction fails, every money of yours actually received by the vendor shall be returned to you.
Thanking you always.
For: ONUZURUIKE LAW CHAMBER
Fes Eze Eke LL.M, BL. NP
Principal Solicitor & Notary Public
The above two Exhibits CE14 and CE15 contain in clear terms the agreement reached by the parties. But a careful perusal of all the correspondences tendered in this case as Exhibits shows that the relevance of Exhibit CE15 was not recognised. Its contents surely pulled the rug off the feet of the Respondent and demolished all her arguments and contentions. Learned counsel for the Defendant/Respondent in his Reply to the written address of the Claimant/Appellant on points of law at page 242 half heartedly submitted that Exhibit CE15 was not served or communicated to the Defendant/Respondent. However the document was duly pleaded in the last paragraph of the Appellants Reply to the Statement of Defence at page 129/130 of the Record andÂ paragraph 7(d) of the Defence to Counterclaim at page 133 of the Record. It was admitted as Exhibit CE15 without any objection by the Respondent. The learned trial Judge rightly observed that Respondent Counsels argument in his address that Exhibit CE15 was not served on the Respondent amounted to giving evidence in the written address as the document was already in evidence without any objection. See page 285 of the Record. There, the learned trial Judge observed:
“The claimant’s counsel in his written address submitted that Exhibits CE14 and CE15 embodied the agreement between the parties. He then summarized his opinion, the defence counsel chose to focus on only Exhibit CE14 and the (sic, he) concluded that the summary by claimant’s counsel which embodied Exhibit CE15 was done in order to mislead. Exhibit CE15 is a document which speaks for itself and its contents lend credence to the summary by claimant’s counsel. I cannot see any attempt to mislead in the said written address.
Thus the terms of the contract between the parties per Exhibits CE14 and CE15 which the learned trial Judge also accepted are as follows:
“1. Subject matter of contract of sale of land – claimant’s property Situate at No. 3 Kayode Street, River Valley Estate, Ojodu.
2. Agreed purchase price – N16.5 Million
3. Agency – 3% of purchase price (N16.5M)
4. Time for final payment of full purchase
Price on/before 30th October, 2007.
5. Possession and ownership – to pass upon full payment of agreed purchase price of N16.5 million.”
The terms are indeed clear and the learned trial Judge had no difficulty in finding that the defendant/respondent was promised possession upon payment of the full purchase price. The respondent paid N14 million as part payment and subsequently refused to pay the balance of N2.5 million on the ground that the appellant failed to give her vacant possession. The contents of Exhibits CE14 and CE15 will seem to suggest that in between the two correspondences there were oral discussions that led to variations in the contents of Exhibit CE14. For example, item 3, the payment schedule was completely varied. Instead of N12.5 million payable before 31/3/07, leaving a balance of N4million, N14million was paid leaving a balance of N2.5million.
How then does one explain the insistence in Exhibit CE15? that any variation or deviation from the terms you stated in the aforesaid letter under reference shall automatically render void the entire sale transaction and any money or moneys paid by you to the vendor shall become refundable. For the avoidance of doubt, you must strictly keep to the schedule of payment and every term contained in your letter of offer of 14th February, 2007, failing which the entire sale transaction shall become null and void and of no effect.”
This, with respect raises some suspicions about Exhibit CE15. Since the Respondent failed to challenge the document in her pleadings and evidence in Court we have no choice but to accept it as authentic. So by the agreement of the parties, the Respondent had to pay the full purchase price before possession can pass to her. It is only after she had paid the full purchase price that the failure of the appellant to deliver vacant possession would become an issue. Any alleged oral agreement to the contrary is of no moment as the parties are bound by the contents of Exhibits CE14 and CE15.
The Respondent had to pay the full purchase price before possession can properly pass to her. As the learned trial judge put it, she failed to allow the claimant manifest his full intention before she stopped the payment of the balance. The Respondent was clearly the one in breach of the contract of purchase and not the Appellant. The big question therefore is whether the breach entitled the Appellant to rescind the contract of purchase in the peculiar circumstances of this case? Or put in another form and as couched under issue 3, whether the refusal by the Respondent to pay the full purchase price of the property goes to the root of the contract thereby entitling the Appellant to rescind the contract of sale? It is not in doubt that under normal circumstances, a refusal by a purchaser to complete the full payment under a contract of sale of land amounts to a breach which would entitle the owner either to rescind the contract or to sue for specific performance of the contract of sale. It is inconceivable that a purchaser will insist on ownership or retention of possession of property belonging to another when full payment for the property has not been made.
The Respondent apparently decided to take advantage of the great favour and warm hand of friendship extended to her by the Appellant who surrendered to her upfront all the documents of title to the property to enable her obtain a loan for the purchase of the property. The Appellant, having actually received the N20 million loan could easily have insisted on full payment of the purchase price. But on the contrary, he graciously obliged the Respondent and returned to her as requested N6 million accepting post dated cheques for the balance of N2.5million. These events led to the registration of title documents by the bank including a mortgage deed covering the loan facility. The Respondent ill advisedly and in contravention of the agreement in Exhibit CE15 believing that she now owned the property refused to pay the balance of the purchase price because she had not been given vacant possession. Her contention was that one of the tenants in the building had paid rent in advance to the Appellant such that the tenant would still be entitled to stay on in the flat after the entire purchase price would have been paid. All these matters go to no issue once it is accepted that Exhibits CE14 and CE15 govern the transaction. Respondents reference to Exhibit DE2, her offer letter of January 8 2007 in which she asked for vacant possession and which the learned trial Judge appeared to give credibility to is not helpful to her case. The offer was rejected and she made a counter offer Exhibit CE14 in which no mention was made of vacant possession. The learned trial judge in his judgment at page 284 of the Record observed:
The claimant and his witness also denied that the issue of vacant possession was not part of the agreement with the defendant because of Exhibit CE15. I do not believe the claimant and his witness in respect of this assertion. The stance taken by the claimant and his witness also does not appear reasonable to me all the facts of the case considered. How can a person make part payment of N14.0m for a property and not demand vacant possession. I believe the defendant when she stated that the future payments were to be made to coincide with the termination of the then valid tenancies.
The learned trial judge cannot approbate and reprobate. At page 285 of the Record His Lordship had accepted Exhibit CE15 in the following words:
Exhibit CE15 is a document which speaks for itself and its contents lend credence to the summary by claimant’s counsel. I cannot see any attempt to mislead in the said written address.
If Exhibit CE15 is accepted as governing the transaction especially given that the Respondent made no effort to challenge its authenticity, all claims by the Respondent about vacant possession must be rejected notwithstanding the possibility that she may have been deceived or misunderstood the representations made by the Appellants agent, Mr. Fez Eze who testified as CW2. It is hard to believe that a highly qualified engineer such as the Respondent knowing the contents of Exhibit CE15 could continue to insist on vacant possession before payment of the balance of the purchase price. It is not in doubt as shown in the many authorities referred to above that failure to pay in full the purchase price as agreed by the parties is a fundamental breach entitling the owner to rescind the contract and sue for damages. The authorities however show that there must be a demand for the balance and refusal or failure to pay. Here, the Appellant did not demand the balance from the Respondent. At page 287, the learned trial judge observed:
I will deal with the first two issues by claimants counsel together. The issues were whether the failure of the defendant to pay the full purchase price at the agreed time and the arrogation of ownership of the claimants property to herself does not amount to breach of contract which entitled the claimant to rescind the contract. I must observe that contrary to the latter part of issue two formulated by the claimants counsel there was no single demand for the balance of the purchase price by the claimant from the defendant after the first cheque of instalment was dishonoured. That was the evidence of the claimant himself rather it was his agent who wrote Exhibit CE5 to the defendant after the incident. Exhibit CE5 was by no means a demand for payment of the balance but rather a letter which sought clarification on the status of the contract between the parties. Under cross-examination claimant stated that he does not want his balance payment but he wants his property back.
As I stated earlier, the right to rescind the contract also depends on the peculiar circumstances of each individual case. Where there are extenuating circumstances, the Court will hold that the breach is not so fundamental as to warrant rescission of the contract. Here, the Respondent had paid N14.0m out of the purchase price of N16.5m. The balance was just N2.5m. I agree with the learned trial Judge that it is unconscionable for the Appellant who had kept the Respondents N14.0m since 2007 and used it for his private business to now seek to return the money and take his property back for failure of the Respondent to pay the balance of N2.5m. More so, knowing that the Respondent paid for the property with money borrowed from the bank and that the title documents are with the bank and the property mortgaged to the bank. Too much has happened and it is simply not feasible or equitable to allow the Appellant to rescind the contract of sale. The viable option in the circumstances is an order of specific performance of the contract and possibly damages for the breach, if the circumstances permit. The Appellant had his tenant in one flat and has been collecting rent from the tenant all these years. Courts are not robots that adhere to technical rules without giving heed to the peculiar facts of the particular case. That is why the Courts can call on equity when necessary to do what is just and right for the parties. After all, the Appellant had parted willingly with his title documents. It appears the Appellant may have been so incensed by the manner in which the Respondent so quickly got rid of the two tenants and commenced reconstruction of the property without paying the balance of the purchase price and on top of it acting as if she was the master of the game Madam Know-it-all! He then took it upon himself to teach her one or two lessons! In this regard, I note the evidence of the Appellant that the tenant Mr. Patrick Obiorah a staff of Richwell Plaza Ltd a company in which he had majority interest would have been the easiest tenant to get rid of. But because of what he saw as the obduracy of the Respondent, the Appellant ensured that the tenant stayed put without any indication of intention to ever leave the flat. That was the reason why the respondent now reneged on paying the first instalment.
She discovered what she claimed to be the non-disclosure of a vital fact on vacant possession that Mr. Patrick Obiorah had actually paid rent on the property until 2010 and that vacant possession cannot be delivered until after 2010. This in a nut shell is the genesis of this avoidable impasse. Even while giving evidence at the lower Court in 2011, the Claimants witness (CW2) Barrister Fes Eke Eze admitted that Richwell Plaza Limited was still their tenant on the property and that its tenancy subsisted till the time he gave evidence. (Page 284 records). The situation remains the same till date. The Appellant is clearly not as innocent as he wants the Court to believe. A purchaser who paid N14.0m out of total purchase price of N16.5 is entitled to worry about vacant possession. No one wants to purchase a law suit in the process of buying property. The Appellant is wrong in his postulation that a purchaser should pay the full purchase price, at which point a sitting tenant would then be given notice to quit. A purchaser has the right to negotiate vacant possession. I believe that was what the Respondent tried to do in spreading out payment of the balance of the purchase price the way she did. There was apparently a break-down in communication. It is possible that the person responsible for this break-down in communication is the Appellants agent, Mr. Eze. Be that as it may, my advice is that both the Appellant and the Respondent should climb down from their high horses and do the needful.
While most of the authorities cited hold that failure to pay part of the purchase price as negotiated is a fundamental breach entitling the vendor to rescind the contract, the situation is bound to differ where the vendor has voluntarily parted with title documents to the property and the property is already the subject of a registered mortgage deed by a bank that provided the loan for the purchase; all to the knowledge of the vendor. Further, the Respondent did not refuse to pay the balance. Issues arose which needed to be sorted out. Rather than engage in negotiation to sort out the issues, the Appellant decided he wanted his property back. At the trial he testified that it was not a question of money, that he wanted his property back.
The circumstances of the case make it impossible to grant an order of rescission of the contract. The appropriate remedy is an order of specific performance. The appeal is consequently lacking in merit and is hereby dismissed. The judgment of the lower Court is affirmed. I make no order as to costs.
HARUNA SIMON TSAMMANI, J.C.A.: My learned brother, C. E. lyizoba, JCA has admirably and exhaustively considered in depth the legal and factual issues that came up for determination in this appeal. I agree totally with the findings and the views expressed by my learned brother in the judgment, and adopt same as mine.
It is obvious from the oral and documentary evidence adduced by the parties as shown on the Record of Appeal, that the Respondent was apparently in breach of the terms of the Contract of sale as depicted in Exhibits CE14 and CEL5. That breach would ordinarily have entitled the Appellant to rescind the contract, but considering the entire circumstances of the case, it would be inequitable to allow him to do so. For that reason, I agree entirely with my learned brother that the justice of the case will be met if we order for specific performance of the contract as stipulated in Exhibits CE14 and CE15. See Gaji v. Paye (2003) 8 NWLR (Pt. 823] 583; LSPDC & Anor v. Nigerian Land & Sea Foods Ltd (1992) 5 NWLR (pt. 244) 653 and Help (Nig.) Ltd v. Silver Anchor (Nig.) Ltd (2006) 5 NWLR (Pt. 972) 196.
On that note, I agree with my learned brother that this appeal should not be allowed. It fails and is accordingly dismissed. I abide by the consequential order(s) made in the lead judgment.
NONYEREM OKORONKWO, J.C.A.: I had the privilege of reading in draft the leading judgment of my learned brother Chinwe Eugenia lyizoba, J.C.A.
I agree entirely with the reasoning therein and the conclusion arrived thereat. The appeal lacks merit and ought to be dismissed. The appeal is hereby dismissed by me and the judgment of the lower Court delivered on the 25th of June, 2012 is hereby affirmed.
FES EZE EKE ESQ. WITH HIM, D. A. IKEM ESQ. AND S.C. EMEH ESQ.For Appellant(s)
SOLOMON A. IMOSEMI ESQ.For Respondent(s)
FES EZE EKE ESQ. WITH HIM, D. A. IKEM ESQ. AND S.C. EMEH ESQ.For Appellant
SOLOMON A. IMOSEMI ESQ.For Respondent