Reuben N. A. Ekwunife v Wayne (West Africa) Limited (SC 200/1986) [1989] NGSC 14 (7 December 1989)

In The Supreme Court of Nigeria

On Friday, the 8th day of December 1989

SC 200/1986


Reuben N. A. Ekwunife                  ......             Appellant

(Trading under the name and style of Gonglobe Associates and Company)


Wayne (West Africa) Limited                   .......                      Respondent


Judgement of the Court

Delivered by

Philip Nnaemeka-Agu . J.S.C.

This is an appeal by the plaintiff against the reversal by the court of appeal Kaduna Division of the judgement given in favour by L.D. Abdullahi, J., in a Jos high court. The claim before the court is as follows:

The defendant by Local Purchase Order No. 17142 and 17143 all dated 31st October, 1977 and by letter Reference No WJ/ ADM 069/7/78 awarded the work of laying of underground cables for its petrol pumping stations in the following towns Mangu (5 pumps) Barkin Ladi (5 pumps) Nassarawa, (5 pumps) Bassa (5 pumps) Pankshin (5 pumps)Wase and Kanam (5 pump)


The plaintiff in accordance with the Local Purchase order and the letter Reference No. WAJ/ADM 069/7/78 did carryout the projects in the specified areas and make a demand for payment of work done which the defendant refused, or neglected to pay.


Wherefore the plaintiff claims from the defendant the sum G of N16,000 (sixteen thousand Naira) as payment for the work done


The said two Local Purchase Orders (to be henceforth called L.P.Os) run as follows:


Supplier’s copy

Wayne (West Africa) Ltd

Subsidiary of Dresses Industries Inc.

Agents for Tecalemit & C.L.Equipment.


7354, 45950

38-40 Burma Road, P.O. Box 103, Apapa



Enugu Tel: 3503

Ibadan Tel: 23639

Kano Tel: 4419

Jos Tel: 2541

P.H. Tel: 8276

Benin Tel: 21


Local Purchase Order

NO. 17442


Conglobe Associates & Co.,

E.5 Abdul Salami Street




Please Supply/Repair the following





Item No.




Carryout flame proof Electrification



At M.O. Trade Yards in the following



Area to Wayne pumps-



Bassa-5 pumps



Pankshin- 5 pumps



Langtan – 5 pumps



Wase and Kanam- 10 pumps



Wayne will supply Cables and glands






Switches by you



Subject To …………………… % Discount


The duplicate copy of this purchase order must be attached to your invoice. The Company cannot accept responsibility for delays in payment arising from non-compliance with this condition.


Ten Thousand Naira Only.


Approved Signature


Conditions on Reverse Side



Supplier’s copy

Wayne (West Africa) Ltd

Subsidiary of Dresses Industries Inc.

Agents for Tecalemit & C.L.Equipment.


7354, 45950

38-40 Burma Road, P.O. Box 103, Apapa



Enugu Tel: 3503

Ibadan Tel: 23639

Kano Tel: 4419

Jos Tel: 2541

P.H. Tel: 8276

Benin Tel: 21


Local Purchase Order

No. 17443

Conglobe Associates & Co



E.5 Abdul Salami Street





Account Code…………………..


Please supply/repair the following:



Item No.




Carry out flame proof Electrification At M. O. Trades Yard in the following Area

(1) Mangu 5 pumps

(2) Baraki Ladi 5 pumps

(3) Nassarawa 5 pumps

Wayne will supply cables and glands. Gear switches to be supplied by you





Subject To


%  Discount 6,000.00


The duplicate copy of this Purchase Order must be attached to your invoice. The company cannot accept responsibility for delays in payment arising from non-compliance with this condition.

Six thousand Naira only.


Conditions on Reverse Side


It is to be observed that each L.P.O. referred to the conditions on the reverse side. But because of the materiality and bearing of these conditions to the result of this case, I shall set them out at a more appropriate time.


The suit was initially commenced under "Undefended List" but, on the application of the defendant, pleadings were ordered, filed and duly exchanged. I shall set out only portions of the pleadings, which I consider relevant to the issues that have arisen for determination in this appeal, later in this judgment.


I should mention, too, that after the contract was awarded on the 31st of October, 1977, without any limitation as to time of completion, the defendant, by a letter dated 1st February, 1978, (Exh. 2) unilaterally gave to the plaintiff two weeks to complete the work and imposed a penalty of N5 .00 for any day the plaintiff failed to complete work. It is, however, noted, as pointed out by the Court of Appeal, rightly in my view, that the parties did not rely on Exh. 2, even though the two bills of completion for total sum of N16,00.00 submitted by the plaintiff which were tendered as Exh. 3 and 3A. were dated 1/3/78 and 11/3/78.1 may observe also that the Manager of the defendant company duly signed the bills as submitted.


After pleadings, the parties made some futile attempts at settlement out of court. During the negotiations the defendant made an offer - "without prejudice" - to pay N9,000 in full and final settlement of the claim. But as the negotiations broke down, the case went to trial. Plaintiff testified on his own behalf and one Peter Adenola who took over from the signatory of Exh. I. lA. 3 and 3A. testified on behalf of the defendant. In his judgment the learned trial Judge made the following findings, inter alia:


(i)    That the contract between the parties was one in writing, contained in Exhs. 1 and lA. which must be relied upon exclusivelv for ascertainment of the terms of the contract;


(ii)    That the contract was a divisible contract, which the plaintiff had substantially performed and so was entitled to payment, subject to any counter-claim by the defendant for any defects or omissions towards the diminution of the contract price;


(iii)   That as there was no counter-claim the plaintiff had proved his case beyond a balance of probability and so was entitled to payment.


He therefore entered judgment to the plaintiff on his claim for N 16,000.00 with interest at 10% with effect from 1st March 1978.


The defendant appealed to the Court of Appeal. Jos Division. In the lead judgment of Karibi-Whyte, J.C.A. (as he then was) to which Wali. J.C.A. (as he then was) and Maidama J.C.A. concurred, he reversed some of the findings and then the judgment of the leaned trial Judge. The court held as follows:


(i)    That the contract between the parties was on the basis of the L.P.Os Exhs. 1 and 1A and that these and no more were the contract documents;


(ii)    That the contract was not a divisible one so that the plaintiff ought to have completed performing his own side of the bargain before demanding payment:


(iii)    That on plaintiffs admission the contract was for electrification not for laying cables:


(iv)    That uncontradicted evidence of D.W. 1 shows that even the amount of job done was poorly executed:


(v)    That as on his own admission he did not complete electrification he did not substantially perform and so was not entitled to payment; and


(vi)    That the learned trial Judge had no jurisdiction to have awarded interest to the plaintiff from a date ante-dating the judgment


The plaintiff (hereinafter called the appellant) has appealed to this court upon four grounds of appeal. Counsel on both sides formulated the issues for determination similarly


They are:


Issues Presented


The questions or issues for determination in this appeal are:


(1)    Whether the Honourable Court of Appeal was right in the interpretation placed on Exhibit I & 1A to include the supply of Electricity or whether "Flame proof electrification" includes supply of electricity by the contractor.


(2)    If the answer to questions in the affirmative then the further question is whether an employer can make a contractor to contract to perform what amounts to illegality and what is the effect of that aspect of the contract that is tainted with illegality.


(3)    Whether a party can rely on the illegal aspect of the contract to avoid liability more especially where he has derived some benefits therefrom.


(4)    Whether a Court can order interest to be paid on a judgment debt from a date before the date of the judgment.


Each counsel has also addressed us orally. The defendant shall hereinafter be referred to as the respondent. I shall now proceed to consider these issues in the light of the written and oral submissions made on them.


Now the issue of illegality of the contract is being raised in this court for the first time. It derives from the controversy over the precise scope and intendment of the contract between the parties as evidenced by Exhs. "1" and "lA" The appellant's reasoning is this: If the expression 'flame proof electrification" includes the requirement that the appellant must supply electricity, even though the evidence shows that there were not yet electricity supplies at the different locations of the contract - at Bassa, Pankshin, Langtang, Wase, Mangu, Barakin Ladi and Nassarawa - then the contract is illegal. This is because it is in breach of section 1(i)(a) and 7(2) of the National Electric Power Authority Act No.24 of 1972 which gave monopoly to generate, transmit, transform, distribute, sell, and supply electricity to the National Electric Power Authority. It was contended, therefore, that to construe the contract, as the court below did, to include supply of electricity was wrong. In any case, the respondent cannot use its own wrong, i.e., illegality, to avoid liability. The cases of Chief Harold Sodipo V. Lemminkainen OY (1986) 1 N.W.L.R. (Pt.15) 222; and Ayo Solanke V. Abed & 2 Ors. (1962) N.N.L.R. 92 at 94 were cited in support.


In his reply. the learned counsel for the respondent submitted that the contract contained in Exhs. "1" and "1 A" was not illegal. This is because the statute envisages that the National Electric Power Authority (hereinafter called N.E.P.A.) could license persons to assist it in executing its statutory functions. Furthermore, he submitted that as the contract, as modified did not contravene the statutory functions of N.E.P.A., it is therefore not ex facie illegal. Illegality ought, therefore, to have been raised on the pleadings, but was not. So it ought not be considered at all.


It is necessary to begin by restating the position of this court with respect to questions of illegality as a vitiating element in contracts. It is that when a contract is ex facie illegal, whether such an illegality has been pleaded or not, the court will not close its eyes against it. For it takes the view that it G is the duty of every court to refuse to lend its stamp of authority on any illegal transaction. See on this Sodipo V. Lemminkainen OY(supra) at pp.232-235. Where, on the other hand, the contract is not ex facie illegal and the question of illegality depends on a number of facts - probabilities, or possibilities, or contingencies - to be hammered out by evidence and forensic logic, the general rule is that the illegality must be raised on the pleadings. See Okagbue & H Ors. V. Romaine (1982) 5 S.C. 133 at p.156. See also - George & Ors. V. Dominion Flour Mills (1963)1 All N.L.R. 71, at p.74.1 see nothing in the contract evidenced by Exhs. 1 and lA to suggest that it, exfacie, intends any invasion of any statutory functions reserved for N.E.P.A. I must also take notice of the common practice whereby electrical contractors apply to N.E.P.A. for connection and supply of electricity after wiring their premises or other structures requiring electricity. So, as the contract is not ex facie illegal and the circumstances upon which the alleged illegality depends have not been pleaded and, indeed, the appellants and respondents have advanced widely divergent views on the point, it is imperative that I should not decide this case on the appellants' conjecture of the supposed illegality.


A lot of argument went into the actual scope of the contract - whether, as the appellant contends, it was just for laying of underground cables for the petrol pumping stations, or, as the respondent argues, for laying of cables and electrification. It is necessary to examine the facts. In paragraphs 3 and 9 of the statement of claim, the appellant pleaded as follows:


3.     The defendant by its local purchase order No.17442 and 17443 both dated 11/10177 awarded the work of laying of the underground cable for its petrol pumping stations in the following towns Mangu (5 pumps) Barkin Ladi (5 pumps) Nassarawa (5 pumps) Basa (5 pumps) Pankshin (5 pumps) Wase and Kanam (5 pumps) each. The plaintiff is also to supply Gear switches all at a cost of N16,000 (sixteen thousand naira). The plaintiff will rely on the L.P.O. at the trial.


9.     That plaintiff was not given the contract of electrification but that of laying of the cable only. A different contractor was awarded the contract for electrification.


This was also the claim on the writ of summons. Clearly these put it across from the beginning that the contract awarded to him was for the laying of underground cables - for the petrol pumping stations. In answer to this the respondent pleaded in paragraph 2 of its statement of defence that:


Contract was awarded to the plaintiff for laying and electrification of underground cables.


The issue that emerged from this state of the pleadings is clear: was the contract for only the laying of underground cables or was it for laying and electrification of the cables.


I should pause here to observe that neither of these contentions is precisely in terms of Exhs. "1" and "lA" which describe the contract as being for:


Carrying out flame proof electrification.


As I see it if either case, as pleaded, was established, it appears to me to follow that there has been a variation or modification of the contract as described in Exhs. "1" and "lA." For, it is clear that the purpose of pleading in a statement of claim is to give to the defendant notice of the ground of claim, so as - in keeping with the audi alteram patem rule - prevent surprise and enable him prepare his defence. Pleading has long ceased to be technical in form: facts are only required to be stated in a summary and concise manner in order to reflect a party's case. See - Philipps V. Philipps (1878) 4 Q.B.D.127 at p.132. And only material facts need be pleaded. Even so, the courts are concerned with the legal result of the pleaded facts: Lever Brothers V. Bell (1931) 1 K.B 357. It is pretty clear that "electrification" as in the contract documents cannot without more simply mean either laying of underground cables or laying of cables and electrification. This point is of material significance because the court below, relying on the case of Crusader insurance Co. Ltd. V. Anunike (1975)3 S.C. 71, at pp.79 and 81 held that no 'variation in the contract was pleaded and so evidence of the appellant on non-availability of electricity affecting performance and agreement only to lay the cable went to no issue. It appears to me that putting paragraph 3 of the statement of claim against Exhs. "1" and "1A" a plea of variation is implicit from the pleading.


As for which of the cases on the variation of agreement, appellant's or respondent’s. was established by evidence, I should refer to the evidence adduced. Appellant himself testified in chief as follows:


The contract was to lay covers (sic) from the house to the pump island - five pumps at each station


Later he continued:


I was asked to lay cables from the bay to the pump island underground and when plaintiffs (sic) were ready they would connect the pump island with the electric cables themselves. 1 was issued with cables and glands and the rest of the materials were supplied by me - these include soil pipes, gear switches, clips.


Under cross-examination he testified as follows:


I sent a total bill of N6,000.00. I did not complete the contract with reasons. because there was an agreement after I received Exh. 2 that after laying the cables to pumps island that I should leave the connection to pumps pending when defendants connected the pumps on the islands, they would connect it themselves.


He also explained that at the time he laid the cables there was no electricity at those places where the cables were laid. Taking the above pleadings and having regard to the essence of pleading, it cannot be doubted that it was pleaded that. inspite of Exhs. 1 and IA, what he was asked to do was to lay the cables. After all, it has been stated, rightly I hold, that a variation merely involves a definite alteration, as a matter of contract, of contractual obligations by the mutual agreement of both parties: see - Plevins V. Downing (1876) 1 C.P.D. 220 at p.225. And it cannot be doubted that the above evidence standing by itself sufficiently proved and explained the point, subject, of course to what the respondent had to offer in contradiction. Surprisingly. no credible evidence was offered on its behalf. Respondent's Manager who awarded the contract and made Exhs. "l" and "lA" and signed Exhs. "3" and "3A" did not testify. He was in the best position to have confirmed or denied appellant's assertions on the point. The only defence witness, Peter Adenola, who testified as D.W.l, admitted that he was not present when Exhs. "l". "1 A" "3" and "3A" were made. All that he could testify to was based on the file copies of these documents and speculation as to what his company should usually do. As a matter of law, when we talk about putting evidence called by either side on a balance, what ought to be compared is credible evidence usually of the same quality. Direct evidence cannot be compared with hearsay and speculative guesswork. I am bound to hold therefore. that on the state of the facts before the court, the evidence called by the appellants went one way. as uncontradicted. It was therefore, clearly established that what the appellant was asked to do was to lay the under-ground cables; that the respondents would connect electricity by themselves, when available. Facts which emerged subsequently confirmed this. It was pleaded in paragraph 5 of the statement of claim as follows:


The plaintiff completed the work on schedule and was inspected and approved by the defendant who later signified its acceptance when the plaintiff forwarded his bills Nos. 026 and 027 both dated 1/3/78. The plaintiff will rely on these at the trial.


Appellant testified that when he completed the work, it was inspected and approved by the Manager of the respondent who also signified his approval by signing his bills, Exhs. "3" and "3A." It has not been disputed that what appears as the Manager's signatures on Exhs. "3" and "3A" were his. On the above facts, the remark of the learned trial Judge that it was D.W. 1 who, for reasons best known to him, kicked up the whole controversy in this case be-comes eminently palpable.


The court below also accepted respondent's evidence that the appellant performed the job poorly. His Lordship held:


The learned trial Judge ignored the uncontradicted evidence of D.W.1 that the jobs were not properly done and that the cables were laid in different direction to where pumps were cited, and that the cables were not connected to the pumps.


The last reason has not taken into account the variation of the contract. On the question of the evidence being uncontradicted, the court appeared not to have adverted its mind to the evidence of the appellant that the work done by him was inspected and approved by the representative of the respondent before he signed his bills, Exhs. "3" and "3A." This would appear to have cast serious doubts on the respondent's allegation of poor performance which only arose long after D.W.1 took over in July, 1978. It is not, therefore, quite right to say it was uncontradicted. Moreover, it was never suggested to him under cross examination, nor was it pleaded, that he laid the pipes in different directions from the positions of the pumps. The allegations first emerged in the evidence of D.W. 1 after appellant had closed his case. This court has said several times that findings on primary facts are essentially the preserve of courts of first instance. Although an appellate court may interfere in a limited number of cases, yet, where the reason for such interference turns out to be wrong or unfounded, this court has a duty to set it aside. I may add that the testimony of a defence witness on a fact that was not pleaded and which was not put to the appropriate witness for the plaintiff under cross-examination so that he could affirm, deny, or otherwise explain it, has little, if any, cogency in law.


On the above facts, I should further consider whether ,pleadings apart, the court below was right to have ignored the evidence of the variation of the contract as a result of non-availability of electricity and held, as it did, that:


It is obvious on the face of Exhibits "1" and "1A" that the contract therein can only be performed completely by carrying out the jobs described in the different stations therein stated.


In other words it ignored oral agreement or variation pleaded by the appellant as well as his case that the respondent inspected the completed work, approved it and signed Exhs. "3" and "3A."


Now it has not been disputed that parties to a contract may effect a variation of the contract by modifying or altering its terms by mutual agreement. If authorities are required for this, I may mention the cases of –


Goss V. Lord Nugent (1835) 5 B. & Ad. 58 at p.65

Dodd V. Churton (1897)1 Q.B. 562. See also Chitty on contracts (24th Edn.) para. 1376, 1377 and 1378.


The contention of the learned counsel for the respondent is, however that as the contract was one in writing, it could only be varied by writing. In my opinion this contention was valid at common law (see West V. (1841)2 Man. & G. 729). But courts of equity took a contrary view and held that a contract in writing which by law is not of a class that must be evidenced in writing under the Statute of Frauds could be varied or rescinded by mutual agreement, whether oral or written: see Nash V Armstrong (1861) 10 ( (N.S.) 259. The only requirement was that there must be sufficient consideration to support the variation. Since the merger of law and equity by section 25(ii) of the Judicature Act, 1873, this position in equity has become position at common law. See Steeds & Anor V. Steeds & Anor. (1889)22 Q.I 537 and many subsequent cases. I shall apply the principle in this case, subject to there being sufficient consideration (see Chitty on Contract (24th Edn.), General Part, para. 1378 at p.650). In such cases, mutual abandonment of the existing rights of the parties under the agreement, as from forbearance to suit, is sufficient consideration: see Re William Potter & Co. Ltd. (1937) 2 All E.R. 361. The uncontradicted and unchallenged evidence of P.W.1 and the signature on the bills, Exhs. "3" & 3A after inspection and approval (on the evidence of P.W. 1) are clear evidence that both parties agreed that the appellant need not electrify the pumps after laying the pipes. This is sufficient consideration. As explained by Privy Council in Morris V. Baron & Company (1918) A.C. 1 at p.31, what is involved in such cases is strictly not a variation but an agreed change in the mode and manner of performance. I must therefore reject the that as Exhibits "1,' and "1 A" are in writing, it could not be contradicted altered, added to or varied orally: that any variation thereto must also be in writing. Learned counsel probably had an eye on the provisions of section 131 of the Evidence Act. It is useful to note that there is an analogous rule under the common law. But it has been recognised that the whittled down by a number of exceptions. See - Walker Property Investment (Brighton) Ltd. V. Walker (1947) L.T. 204; Couchman V. E.R. 103. Hence in SS. Ardennes (Cargo Owners) V. Ardennes (1951)1 K.B. 55' it was held that evidence of an oral representation by an agent of the ship owner that the ship was to proceed direct to London was admissible to contradict the contents of the bill of lading which stated that the ship could proceed "by any route and whether directly or in directly" London.


In our own law, section 131 itself provides for seven classes of exceptions, of which subsection (1)(d) of that section is relevant. That paragraph of the proviso specifically provides as follows:


Provided that any of the following matters may be proved:


(d)    the existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property;


This proviso clearly provides, inter alia, that evidence of a subsequent oral agreement between the parties to modify a contract is admissible. In other words, in the instant case, oral evidence of the appellant that as a result of the non-availability of electricity at the locations of all the pumps, he and the representative of the respondent agreed that he should only lay the pipes and that the respondents would connect electricity afterwards, was rightly admitted. See also Gillespie Brothers v. Cheney Eggar & Co. (1896)2 Q.B. 59 at 62. From this state of the law and on the above facts, including the conduct of the respondent in signing the appellant's bills (Exhs. "3" and "3A") after inspection of the works and approving them, which act is clearly inconsistent with the suggestion that it was intended that the appellants should electrify the pumps, I cannot but come to the conclusion that it was not intended that Exhs. "1" and "lA" should continue in full force to the effect that if the appellant did not electrify the pumps he should he held not to have fulfilled his own side of the bargain. I therefore agree with the learned trial D Judge, though for slightly different reasons, that the appellant proved that he substantially performed his own part of the contract, and so was entitled to payment.


On this conclusion, it becomes scarcely necessary to consider whether the contract was divisible or entire. As counsel on both sides devoted so much time and efforts in arguing it, I should also consider it, even if it is in the alternative.


I shall, therefore, now examine whether the court below was right to have held, contrary to the opinion of the trial Judge, that the contract was not a divisible one. The significance of deciding whether the contract was divisible or entire (indivisible) is that, as a general rule, if it was indivisible or entire, the appellant's entitlement to any payment will depend upon his showing that he had executed what he had covenanted to perform. In such entire contracts, complete performance by one party was a condition precedent to the liability of the other, and usually a lump sum payment by one party was the consideration for complete performance by the other. See. Sumpter V. Hedges (1898)1 Q.B. 673, Bolton V. Mahadeva (1972)2 All E.R. 1322. However, as a rigid application of this principle invariably led to unjust enrichment of the defendant who enjoyed some benefit from the contract without paying for it, the courts, in their desire to do justice between contracting parties, in particular to mitigate the harsh results of the rigid application of the principle - of indivisible contracts - on plaintiffs who often spent huge sums of money to perform some part of their own side of the bargain, developed the doctrine of substantial performance. The sum total of this doctrine of substantial performance is that, though the contract is indivisible, so long as the promisor has performed a substantial part of his own side of the bargain, though he may not have performed precisely or fully what he had promised to perform, he is entitled to sue a promisee who has accepted what he performed on the contract, though the promisee can counter-claim or bring a cross-action for damages for the partial performance, omissions, or defects in execution. See Hoeing V. Isaacs (1952)2 All E.R. 176.


On the other hand. a divisible contract is separable into parts, so that separate parts of the agreed consideration may be assigned to severable parts of the performance. Such divisible agreements admit of pro rata payments for each portion that is performed, and is independent of the performance of other parts of the contract: See –

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