ABUBAKAR SALE (Alias Sholi) VS THE STATE
April 26, 2025ZEF NIGERIA LIMITED VS FIDELITY BANK PLC
April 26, 2025Legalpedia Citation: (2015) Legalpedia (CA) 11251
In the Court of Appeal
Fri Dec 11, 2015
Suit Number: CA/L/360/2007
CORAM
UZO. I. NDUKWE-ANYANWU JUSTICE OF THE COURT OF APPEAL OF NIGERIA
PARTIES
1. WEMA BANK PLC.2. MISS ROSE OKODUGHA APPELLANTS
1. ALARAN FROZEN FOODS AGENCY NIGERIA LIMITED2. MRS. MARGARET APINKE ALARAN RESPONDENTS
AREA(S) OF LAW
SUMMARY OF FACTS
The 1st Appellant restructured the personal account of the 2nd Respondent maintained with it and same was taken over by the 1st Respondent upon its incorporation as a Limited Liability Company. An import finance facility was granted to the 1st Respondent in the sum of 50million Naira for the importation of frozen fish with a 10 million Naira overdraft facility which was granted on the personal guarantee of the 2nd Respondent and a mortgage on her landed properties. The guarantee was undated and the mortgage was already in place long before the incorporation of the 1st Respondent for the loans granted to the 2nd Respondent when she was operating as a sole proprietor. The 1st Appellant insured the imported fish and regularly debited the 1st Respondent’s account for the insurance premium. The 1st Respondent recorded a loss of Thirty–Five Million Naira arising from fish spoilage due to the deterioration caused by break down of refrigerating equipment in the cold stores. A Report was subsequently made by the 2nd Respondent to the headquarters of the 1st Appellant who thereafter submitted a claim under the insurance policy to the insurance company which rejected the claim on grounds that it was a different location that was covered by the policy, that the insurers were not promptly informed of the spoilage before disposal and that the insurance was for a gradual deterioration. Hence, the Claimant now Respondents claimed against the Defendants now Appellants, a declaration that she is the owner of the landed properties by virtue of a Certificate of Occupancy dated 25th January, 1983 and registered as No. 26 at page 26 in vol. 19821 of the Lagos State Land Registry Office at Ikeja despite the existing legal mortgage which still subsisting in favour of the 1st Defendant, a declaration that the Defendants are not entitled to foreclose and redeem the mortgage on the aforesaid properties until conditions for the exercise of such powers are met amongst other reliefs. At trial, it was discovered that the 1st Appellant did not take out the insurance in the name of the 1st Respondent but the 2nd Respondent in person. The Appellants filed their statement of defence and a counterclaim. At the conclusion of evidence by parties, the trial court granted the reliefs sought by the Respondents and dismissed the Appellant’s counterclaim. Dissatisfied with the trial court’s judgment, the Appellants have appealed to this court.
HELD
Appeal Dismissed.
ISSUES
– Whether the judgment of the lower court in favour of respondents was supported by the evidence reviewed and the applicable law- Whether the learned trial judge rightly awarded cost in the main suit and the counterclaim respectively.
RATIONES DECIDENDI
AWARD OF COST- INSTANCES WHERE AN APPELLATE COURT WOULD INTERFERE WITH THE AWARD OF COST
“Thus, since cost follows events in litigation, a party need not ask for cost before it can be awarded. That is why it is at the discretion of the court. Whether or not the award of cost is arbitrary is dependent on the peculiarity of each case. The only circumstance under which an appellate court will interfere with the award of cost is when such award is so high or low that there was an entirely extraneous estimate of damages. See Ogunsakin V. Edu Local Govt. Area Kwara State & Ors. (2011) LPELR-8816 CA.” PER IYIZOBA, J.C.A
TERMS OF CONTRACT- PARTIES ARE BOUND BY THE TERMS OF CONTRACT
There is plethora of case laws on the trite principle that parties are bound by the terms of their contract. See Larmie V. Data Processing Maintenance & Services (D.P.M.) Ltd. (2005) 12 SC (Pt. 1) 93 at 103; Baba V. Nigerian Civil Aviation Training Centre, Zaria (1991) 5 NWLR (PT. 192) 388; Union Bank Of Nigeria Ltd. V. B.U. Umeh & Sons Ltd. (1996) 1 NWLR (PT. 426) 565; S.C.O.A. Nigeria Ltd. V. Bourdex Ltd. (1990) 3 NWLR (Pt. 138) 380 and Koiki V. Magnusson (1999) 8 NWLR.” PER C. E.IYIZOBA, J.C.A
DOCUMENTS – EFFECT OF UNSIGNED AND UNDATED DOCUMENTS
“In the case of G.S. & D. Ind. Ltd. v. NAFDAC (2012) 5 NWLR (Pt. 1294) 511 at 538 para H, the court held that it is trite that an unsigned and undated document is a worthless piece of paper that has no evidential value in law. It referred to the cases of Amizu v. Nzeribe (1989) 4 NWLR (Pt. 118) at page 755 and Tsalibawa v. Habiba (1991) 7 NWLR (Pt. 174) at Page 461.” PER C. E.IYIZOBA, J.C.A
AWARD OF COST – AWARD OF COST IS AT THE DISCRETION OF THE COURT
“The law is trite that cost follows event and the Courts are empowered by the Rules to award cost. See the case of NNPC v. Clifco Nig. Ltd. (2011) LPELR-2022 (SC); Mudun & Ors. V. Adanchi & Ors. (2013) LPELR-20774 (CA); Olokunlade V. Samuel (2011) 17 NWLR (PT. 1276) 290 .It is at the discretion of the court to award cost. The ultimate requirement is that such discretion must be exercised judicially and judiciously. In the case of NNPC v. Clifco Nig. Ltd. (supra) Rhodes-Vivour, J.S.C. 26 paras E-G postulated:
“The award of cost is entirely at the discretion of the court, costs follow the event in Litigation. It follows that a successful party is entitled to costs unless there are special reasons why he should be deprived of his entitlement. In making an award of costs the court must act judiciously and judicially. That is to say with correct and convincing reasons. See Anyaegbunam v. Osaka (1993) 5 NWLR Pt. 294 p. 449 Obayagbona v. Obazee (1972) 5 SC p. 247.” PER C. E.IYIZOBA, J.C.A
BANKER/CUSTOMER RELATIONSHIP – RESPONSIBILITY OF A BANK WHERE IT LENDS MONEY FOR IMPORTATION OF GOODS
“A bank assumes a huge responsibility when it lends money for importation of goods which is to be in the joint custody of the bank and the borrower with sales to be supervised by the bank. If the bank defaults in carrying out its responsibility under the arrangement, it cannot turn round to hold the borrower responsible.” PER C. E.IYIZOBA, J.C.A
CONTRACT OF GUARANTEE – PURPORT OF A CONTRACT OF GUARANTEE
“A contract of guarantee presupposes the existence of another prior contract in form of a loan undertaking which the principal debtor is primarily liable. The obligation of a guarantor to the principal creditor is secondary and will only arise upon the default of the principal debtor.” PER C. E.IYIZOBA, J.C.A
DOCUMENTS – DUTY OF COURTS NOT TO SPECULATE ON THE CONTENT OF DOCUMENTS BEFORE IT
“It is the law that a Court does not speculate on the content of documents not before it.” PER C. E.IYIZOBA, J.C.A
CASES CITED
STATUTES REFERRED TO
None
