HAJIA AISHA ABDURAHAMAN V. KEYSTONE BANK LIMITED & ANOR
August 20, 2025LT-COL DAVID OLUSEGUN JUWAPE (RTD) V. GOVERNOR OF LAGOS STATE & ANOR
August 20, 2025Legalpedia Citation: (2025-07) Legalpedia 52752 (CA)
In the Court of Appeal
Holden at Lagos
Thu Jul 10, 2025
Suit Number: CA/L/435M/2010
CORAM
Yargata Byenchit Nimpar Justice of the Court of Appeal
Abdulazeez Muhammed Anka Justice of the Court of Appeal
Uwabunkeonye Onwosi Justice of the Court of Appeal
PARTIES
DIZENGOFF W. A. (NIG.) LTD
APPELLANTS
WILLMERIC (LA CUISSON) LTD
RESPONDENTS
AREA(S) OF LAW
AREAS OF LAW: APPEAL, BREACH OF CONTRACT, CONDITIONS PRECEDENT, CONTRACT LAW, DAMAGES, EVALUATION OF EVIDENCE, GENERAL DAMAGES, NOVATION, PERVERSE JUDGMENT, PLEADINGS, PROOF OF DAMAGES, SPECIAL DAMAGES, STRICT PROOF, VARIATION OF CONTRACT
SUMMARY OF FACTS
The Respondent sought and obtained loan facility from NERFUND for importation of a 500KVA transformer. The Appellant initially issued a proforma invoice dated 10th October 1994 with Turkey as country of origin, but this was rejected because Turkey was not an ADB member country. A new proforma invoice dated 29th November 1994 was issued with UK as country of origin for $7,900, though $9,995 was approved by NERFUND.
A Letter of Credit was opened on 23rd March 1995 with a 9-week delivery timeframe. Due to unforeseen delays, the Appellant offered to swap an 800KVA transformer already in its Nigerian stock for the 500KVA to be imported. Both parties agreed to this new arrangement with new terms and conditions, including a requirement for the Respondent to provide a bank guarantee.
The Respondent and its banker Afribank fulfilled other conditions but failed to provide the written bank guarantee as demanded. The 500KVA transformer eventually arrived in January 1996 and was delivered to the Respondent.
The Respondent sued for N15,390,000 in special and general damages for alleged breach of contract. The trial court found that the Appellant did not breach the varied contract since the condition precedent (bank guarantee) was not performed, but nevertheless awarded N3,000,000 in special damages and N1,000,000 in general damages against the Appellant.
The Appellant appealed, arguing that the trial court’s judment was contradictory and that damages were awarded without proper evidence or strict proof.
HELD
1. The appeal was allowed and the judgment of the High Court of Lagos State was set aside.
2. The Court held that the original contract had been varied/novated by the parties’ agreement to swap the 800KVA transformer for the 500KVA transformer, with new terms and conditions.
3. The Court held that the trial court correctly found that the Appellant did not breach the varied contract since the Respondent failed to fulfill the condition precedent of providing a bank guarantee.
4. The Court held that the trial court erred in awarding damages after finding no breach of contract, describing the awards as contradictory and not based on evidence.
5. The Court held that special damages must be strictly proved even in undefended matters, and cannot be awarded on compassionate grounds.
6. The Court criticized the trial court for “approbating and reprobating” by making contradictory findings in the same judgment.
7. No order as to costs was made.
ISSUES
The Appellant’s Counsel raised three issues, which the Court resolved under a single issue:
“Whether the Trial Court was right in awarding N3,000,000:00 (Three Million Naira) and N1,000,000.00 (One Million Naira) Special and General damages respectively against the Appellant for the breach of contract.”
RATIONES DECIDENDI
VARIATION OF CONTRACT – PRINCIPLES AND LEGAL REQUIREMENTS
Variation of contract entails a definitive alteration of contractual obligations by mutual agreement of both parties which may be effected by modifying or altering the terms of the contract. A latter agreement by parties to an original contract to extinguish the rights and obligations, that the original contract has created, is itself a binding contract, but the latter agreement, must either (a) be made under seal or (b) be supported by consideration. The maxim is Eodem modo quo oritor eodem modo dissolvitur (what has been created by Agreement may be extinguished by Agreement).– Per UWABUNKEONYE ONWOSI, J.C.A.
CONSIDERATION FOR CONTRACT VARIATION – EXECUTORY CONTRACTS
The law is well settled that a later Agreement by the parties to an Original contract to extinguish the rights and obligations that the original contract has created is itself binding, provided that the later Agreement is either made under seal or is supported by consideration. Consideration raises no difficulty if the original contract sought to be extinguished is, like the contract of 4th March, 1974, still executory. This is because each party, by the later Agreement, is deemed to have agreed to release his rights under the original contract in consideration of a similar release by the other. – Per UWABUNKEONYE ONWOSI, J.C.A. (quoting Fatayi-Williams JSC in GROVER V. I.T.I. LTD)
EXTANT AGREEMENT – EFFECT OF CONTRACT VARIATION
Therefore, in the instant case the extant contract, that is, what is existing and standing before the parties, which defines their rights, duties and obligation is the variation and/or the new agreement and not the old agreement which they have jettisoned. – Per UWABUNKEONYE ONWOSI, J.C.A.
CONDITIONS PRECEDENT – FAILURE TO FULFILL AND ITS EFFECT ON CONTRACT PERFORMANCE
The Court therefore finds that the Defendant did not breach the varied contract in respect of the 800KVA transformer since one of the conditions precedent was not performed. To my mind, the failure of the claimant to furnish the guarantee requested for led to the inability of the defendant to perform the varied contract. The varied contract for the substitution of the 500KVA transformer with the 800KVA transformer was therefore not binding on the Defendant and I so hold. – Per UWABUNKEONYE ONWOSI, J.C.A. (quoting the trial court finding)
JUDICIAL CONDUCT – COURT’S DUTY NOT TO MAKE CASE FOR PARTIES
From the facts and circumstances of this case, the parties never reverted back to the original agreement as concluded by the Trial Court. It was rather the Trial Court that suo motu reverted to the old agreement and made a case for the parties. It was this wallowing in the realm of the old agreement, leaving the extant agreement between the parties and as before the Court that the misdirection and misconception of the case by the Trial Court started. – Per UWABUNKEONYE ONWOSI, J.C.A.
SPECIAL DAMAGES – REQUIREMENT FOR STRICT PROOF AND PROHIBITION AGAINST COMPASSIONATE AWARDS
Special damages cannot be gifted or awarded on a compassionate ground as depicted by the Trial Court, but on the basis of law and evidence and must be strictly proved. – Per UWABUNKEONYE ONWOSI, J.C.A.
APPROBATION AND REPROBATION – PROHIBITION AGAINST CONTRADICTORY JUDICIAL FINDINGS
A party is not allowed in law to approbate and reprobate in his pleadings and evidence, so also, a Court of law is not allowed to approbate and reprobate in his judgment. He has to be consistent. – Per UWABUNKEONYE ONWOSI, J.C.A.
SPECIAL DAMAGES – COURT’S ROLE IN COMPUTATION AND SPECULATION
On the particulars of the special damages as pleaded by the Respondent, his claimed for 13 months, 1995 to 1996, Monday to Sunday etc, under the head of various claims without the particulars as to which months and dates and lumped up the figures. It is not the duty of the Court to go into the voyage of computation and arithmetic of addition and subtraction of the said figure and to speculate as to the particular months, and same cannot be conjured because a Court is not a spirit or soothsayer.– Per UWABUNKEONYE ONWOSI, J.C.A.
DAMAGES – NO AUTOMATIC AWARD DESPITE SUCCESSFUL SUBSTANTIVE CLAIM
Furthermore, in law damages are always said to be in issue requiring Plaintiff to prove them. Thus, it is not the law that where the substantive claim succeeds, subsidiary claim for damages must be awarded automatically. – Per UWABUNKEONYE ONWOSI, J.C.A.
SPECIAL DAMAGES – STRICT PROOF REQUIRED EVEN IN UNDEFENDED MATTERS
Special damages are those matters presumed to be within the knowledge of the Claimant. Therefore, should be clearly pleaded with particulars and be strictly proved, even if the matter is undefended.– Per UWABUNKEONYE ONWOSI, J.C.A.
TRIAL JUDGE’S DUTY – CONTROL OF COURT AND EVIDENCE EVALUATION
Those awards are ‘dash me money’ by the Trial Court to the Respondent, because same are not borne out of evidence. A Trial Judge should be in control of his Court and be in grip of the matter before it at all the times, and should not allow himself to influence by the fanciful arguments of a counsel, but should be guided by the facts and the evidence before it. – Per UWABUNKEONYE ONWOSI, J.C.A.
APPELLATE INTERVENTION – DUTY TO INTERVENE IN PERVERSE JUDGMENTS
It is clear that the Trial Court was merely dilly dally in the evaluation of the evidence. He lost the grip of the matter and his judgment was perverse, never borne out of the evidence before the Court. And where a Trial Court finds itself in such a quagmire, the Appellate Court will intervene to ensure proper evaluation of evidence for interest of justice. – Per UWABUNKEONYE ONWOSI, J.C.A.
NOVATION – DEFINITION AND ESSENTIAL REQUIREMENTS
The law is well settled that a later agreement by the parties to an original contract to extinguish the rights and obligations that the original contract has created is itself a binding contract, provided that the later agreement is either made under seal or is supported by consideration. Novation is the substitution of a new contract for an existing one between the same or different parties. It is done by mutual agreement. It is never presumed. The requisites for novation are a previous valid obligation, an agreement of all the parties to a new contract, the extinguishment of the old obligation and the validity of the new one.– Per YARGATA BYENCHIT NIMPAR, J.C.A.
CASES CITED
STATUTES REFERRED TO
1. Evidence Act Cap 112 LFN 1990
2. Section 137 of the Evidence Act
