CORAM

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COKER, JUSTICE, SUPREME COURT

BELLO, JUSTICE, SUPREME COURT

BABALAKIN,JUSTICE, SUPREME COURT

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PARTIES

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M.J. EKA-ETEH APPELLANTS

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RESPONDENTS

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AREA(S) OF LAW

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SUMMARY OF FACTS

The plaintiff mortgaged his property to the 1st defendant (mortgagee) in consideration of the sum of £2,500 by way of security for the loan. The 1st defendants, in exercise of their statutory power of sale, sold and conveyed to the 2nd defendant) the property in question for £2,850. The plaintiff brought an action against the mortgagee and the 2nd defendant who had bought from them, claiming that the sale be set aside on the ground of fraud, irregularity, and non-compliance with the provisions of the Property and Conveyancing Law of Western Nigeria.

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HELD

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The Supreme Court held that a mere under-value is not enough to justify the finding that the power of sale was improperly exercised by the 1st defendants.

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ISSUES

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The regularity or otherwise of the purported exercise of the power of sale by the mortgagee

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RATIONES DECIDENDI

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FACTORS THAT WILL VITIATE THE EXERCISE OF A MORTGAGEES POWER OF SALE

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“We think it is now beyond controversy that undervalue alone is not enough to vitiate the exercise of a mortgagees power of sale. It must be shown that the sale was made at a fraudulent or gross undervalue. Indeed, it is well established that “if a mortgagee exercise his power of sale bona fide for the purpose of realising his debt and without collusion with the purchaser, the court will not interfere even though the sale be very disadvantageous, unless the price is so low as in itself to be evidence of fraud.” Per DAN IBEKWE, AG. JSC

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CASES CITED

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Warner v. Jacob (1882) 20 Ch. D.220

Kennedy v. De Trafford (1897 A.C. 180 at p. 185)

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STATUTES REFERRED TO

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Property and Conveyancing Law; Cap 100 (Laws of the Western Region of Nigeria)

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