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In The Supreme Court of Nigeria On Friday, the 26th day of January 2007
S.C. 91/2002
Between
And
Judgement of the Court Delivered by Niki Tobi. J.S.C.
This appeal involves a fairly narrow area. It is the amount of damages awarded. At the trial court, the learned Judge awarded the sum of
Briefs were filed and exchanged. The appellant formulates six issues for determination:
(i) Whether the damages due to the appellant in this case was only the profit it could have made for one month having regards to the terms and conditions of the contract in Exhibit B (Covers ground 1).
(ii) Whether the Lower Court could in law rely on evidence of unpleaded facts by either the Appellant or the Respondent in this case to set aside the sum of
(iii) Whether the Lower Court was right in setting aside the sum of
(iv) Whether the rule and decision in Hadley V. Baxendale (1854) 9 Exch 341 has a binding force on Nigerian courts any longer having regards to this Court decision in Eloichin (Nig) Ltd. &Ors vs.VictorMbadiwe (1986) ANLR 1 at 14 (covers ground 5).
(v) Whether the lower court was right in law to reduce the sum of
(vi) Whether the decision of the lower court in this case conform with principles of law regulating proper and correct evaluation and appraisal of evidence. (Covers grounds 2 and 9)"
The respondent formulated three issues for determination:
"3.1 Whether the lower court was not right in setting aside the sum of
3.2 Whether the lower court was not right to have reduced the general damages of
3.3 Whether the lower court was not right in setting aside the sum of
Learned counsel for the appellant, Mr. Kole Olawoye, taking Issues Nos. 1 and 5 together, referred to Exhibit B and pointed out that clause (a) and (b) at page 2 of the Exhibit are very germane and relevant to the determination of the two issues. He contended that the respondent did not give the required one month notice to the appellant. He referred to the evidence of DW1 and paragraph 7 (b) and (d) of the Further Amended Statement of Claim.
Justifying the award by the learned trial Judge, counsel referred to the evidence of PW6, and portion of the judgment by the trial court and the Court of Appeal at pages 149 to 150 and 236 and 237 of the Record respectively. Relying on Oroke v. Ede (1964) NNLR 118; Ngwu v. Ozougwu (1999) 10 -12 SC. 24; Saraki v. Kotoye (1990) 4 NWLR (Pt. 143) 144; Ajadi v. Okenihun (1985) 1 NWLR (Pt. 3) 484; Abidoye v. Alawode(2001) 3 SC. 1; University of Lagos v. Olaniyan (1985) 1 NWLR (Pt. 1) 156 and Ekwunife v. Wayne W/A Ltd. (1989) 12 SC. 81, learned counsel submitted that the Court of Appeal had no legal basis or justification to embark on the reduction of the damages, an action which is tantamount to the substitution of its own view for the decision of the trial court. Counsel also referred to Shell B. P. Petroleum Development Company v.Jammal Engineering -(Nig) Ltd. (1974) 4 SC. 33 and Ijebu - Ode Local Government v. Adedeji Balogun & Co. Ltd (1991) 1 NWLR (Pt. 166) 136 on the principles of law regulating the assessment of damages for breach of contract. He argued that the case of Mobil Oil (Nig) Ltd v. Akinfosile (1969) NMLR 217 relied upon by the Court of Appeal is distinguishable.
On Issue No. 2, learned counsel submitted that the Court of Appeal was wrong in relying on evidence not pleaded to set aside the sum of
On Issue No. 3, learned counsel submitted that the Court of Appeal was wrong in setting aside the sum of
On Issue No. 4, learned counsel submitted that the Court of Appeal was wrong in holding that the rule in Hadley v. Baxendale (185-4) 9 Exch 34, is binding; a decision, counsel said was responsible for the slashing down of the general damages awarded by trial court to
On Issue No. 6, learned counsel submitted that the Court of Appeal did not properly and correctly evaluate and appraise the evidence before it. He referred to specific aspects of the judgment of the Court of Appeal and relied on the following cases. Ugoechi v. Onyenwe (1999) 1 SC. 63; Osagie v. Adonri (1994) 6 NWLR (Pt. 349) 131: Odofin v. Mogaji (1978) 4 SC. 91: Woluchem v. Gudi (1981) 5 SC. 291; Okuoja v. Ishola(1982) 5 SC. 314 and Nwobodo v. Chief Electoral Officer (1984) 1 SC. 53. He urged the court to allow the appeal.
Learned counsel for the respondent, Mr. W. Ogunkoye, submitted on Issue No. 1 that the appellant failed to prove that it was entitled to the payment of the current market value of
On Issue No.2, learned counsel submitted that the Court of Appeal was right in reducing the general damages of N25 million to
Although the award of general damages is a matter for the trial court, an appellate court will interfere in appropriate cases, counsel argued, He contended that this is one such case and the Court of Appeal rightly interfered in the award. He did not see the evidence of PW6 as evidence of proof of damages for breach of contract but as proof of the appellant's annual profit.
On Issue No.3, learned counsel submitted that a plaintiff in an action for detinue must first establish that he is the owner of the thing, the recovery of which he is seeking. He cited Sodimu v. Nigerian Ports Authority (1975) All NLR 151 at 160. This appellant failed to do as it neither pleaded nor proffered evidence required to sustain the claim for detinue before the trial court, counsel argued. He went into the pleadings, particularly, paragraphs 4 and 12 of the Further Amended Statement of Claim, paragraph 11 of the Statement of Defence, the evidence before the trial court and submitted that the appellant failed to prove strictly the claim before the trial court. Citing Saliba v. Yassin (2002) 4 NWLR (Pt. 75) 1 at 18 - 19 and Udechukwu v. Okwuka (1956) 1 FSC 70 at 71, learned counsel submitted that the appellant's claim to detinue must fail.
Learned counsel did not agree with the contention of the appellant that the issue of detinue was a new issue. He referred to paragraph 19(iii) of the pleadings of the appellant and argued that the case of the appellant at the trial court was in detinue. He cited Labode v. Otubu (2001) 7 NWLR (Pt. 712) 256 at 276 and urged the court to uphold the decision of the Court of Appeal 2nd dismiss the appeal.
Learned counsel for the appellant stated the grounds of appeal and their particulars from pages 3 to 7 in the appellant's brief in detail. I must say that brief is not the place to enumerate grounds of appeal and their particulars. They belong exclusively to the Notice of Appeal; not the brief. Parties take issues which deal with the grounds of appeal in their briefs. In other words, grounds of appeal start and end their journey in the Notice of Appeal and issues which reflect the grounds are argued in the brief. I will therefore not consider pages 3 to 7 coaling with the grounds of appeal and their particulars, unless these are specifically attacked in the arguments in the brief. I do not think they were attacked.
The appellant asked for
"The instant case is however not a case of breach of agreement simpliciter and the facts are distinguishable from Mobil's case. Here the plaintiff has given evidence to the effect that before the allegation of fraud it had paid for supply of 1,900 cartons of assorted drinks to the defendant which the defendant refuses to supply. It also gave evidence that it had 4,619 cartons of empty bottles of assorted products which the defendant seized and detained. I had earlier on held all these as established. Further evidence given by the plaintiff was that it could no longer continue in business as a result of the act of the defendant. It is pertinent to observe that the defendant did not formally terminate the agreement of the plaintiff but kept on asking it to wait for the outcome of the investigation into the fraud. I feel that the plaintiff is entitled to substantial damages which I assess at
The Court of Appeal did not agree with the award of
"The contract between the parties was Exhibit B which provided for a term of one month previous notice of intention to determine the contract to be given to the other party.... The appeal on Issue 1 succeeds with the appeal allowed in part with the reduction of the damages for breach of contract of Exhibit B to
Exhibit B is the agreement between the parties.. It is the letter appointing the appellant as a distributor. The meaning to be placed on a contract is that which the plain, clear and obvious result of the terms used in the agreement. See Aouad v. Kessrawani (1956) N.S.C.C.33. When constructing document in dispute between the parties, the proper course is to discover the intention or contemplation of the parties and not to import into the contract ideas not potent on the face of the document. See Amadi v. Thomas Aplion Co. Ltd. (1972) 7 N. S. C. C. 262. Where there is a contract regulating any arrangement between the parties, the main duty of the court is to interpret that contract to give effect to the wishes of the parties as expressed in the contract document. See Oduye v. Nigeria Airways Limited (1987) 2 NWLR (Pt.55) 126. In the construction of documents, the question is not what the parties to the document may have intended to do by entering into that document, but what is the meaning of the words used in the document. See Amizu v. Dr. Nzeribe (1989) 4 NWLR (Pt.118) 755. However, where the meaning of words used is not clear, the court will fall back on the intention behind the words.
Above all, it is not the function of a court of law to make agreements for parties or to change their agreement as made. See African Reinsurance Corporation v. Fantaye (1986) 1 NWLR (Pt.14) 113.
Exhibit B provided in part that without prejudice to accrued rights and liabilities of the parties to the agreement, it could be terminated by one month notice in writing and mat it may be suspended or terminated immediately by notice in writing by the respondent upon the occurrence of same event
In awarding the damages of
"... applying the cases referred to the learned trial Judge found as a fact that the annual profit of Respondent/cross appellant was
Appellant did not accept the award of the Court of Appeal. Reliance was placed on the evidence of PW6. What did the witness say? He said at page 88 of the Record:
"I know the plaintiff in this case. I started auditing the accounts of the plaintiff in 1992. I am auditor to the plaintiff company. The documents now produced and states all the audit accounts made in the name of my Firm Olayiwola Brothers and Company Chartered Accounts. They were produced on the instruction of the plaintiff. They are audited account for the year ended September 1991, September 1992 and September 1993. I signed all the documents. Tendered without objection and admitted as Exhibit N to N2. Looking at the audited account, the plaintiff was making profit. In 1991, the profit was
While I entirely agree with the submission of learned counsel for the appellant that the above evidence of PW 6 was not challenged by the respondent, I do not agree with him on the result or effect of the non-challenge of the evidence, that he wants this court to arrive at. The evidence of PW6 was on a yearly profit running through the year on the average of
What is the quarrel the appellant has with the Court of Appeal? I have taken one and it is in respect of the evidence of PW6. The Court of Appeal accepted the evidence of the witness. All that the court did was to subject the evidence to some arithmetical calculation, which gave the court the figure it awarded as damages. Can this court fault the Court of Appeal? I think not.
Let me take the second quarrel and it is that the Court of Appeal by reducing the amount was involved in substituting its own view for the decision of the trial court. Counsel cited Ngwu v. Ozougwu (1999)10 - 12 SC 24 where Onu, JSC said at page 29:
"It is the business of a trial court to decide disputes by trying cases. It is not the business of an appeal court to re-open disputes by trying case again. An appeal court's duty is to see whether trial courts have used correct procedure to arrive at the right decisions. An appeal court does not inquire into disputes. It inquires into the way in which disputes have been tried and decided since a dispute is to be decided by the trial court and not in the Appeal Court."
With respect, the case is not on the side of the appellant. It is rather on the side of the respondent. The Court of Appeal in this matter did not inquire into the dispute, which I entirely agree is the exclusive adjudicatory function of the trial court. On the contrary, the Court of Appeal in line with Ngwu inquired into the way in which the dispute have been tried and decided. The Court of Appeal went into the dispute as decided by the trial Judge and held that it was wrongly decided. That is the decision of this court in Ngwu and that is what the Court of Appeal did. The Court of Appeal built its findings on the findings of the trial Judge. It was all based on the Exhibit N group of exhibits.
In my view, it is the adjudicatory function of an appellate court to correct errors of trial court and as long as such errors emanate from the Record, an appellate cannot be accused of substituting its own views for those of the trial court. How can an appellate court correct errors of a trial court without reviewing the decision of the trial court in the context of the law and the facts?
It is the submission of learned counsel for the appellant that the Court of Appeal wrongly followed the decision of this court in Mobil Oil (Nig) Ltd, v. Akinfosile (Supra) Counsel enumerated what he regarded as differences in paragraphs 4.24 and 4.25 of the appellant's brief. At times when counsel distinguishes cases to the minutest and infinitesimal way they do, I chuckle. While I can hardly blame them, considering their professional sentiments for the case of their clients, some of the distinctions are without distinction or difference. Factual distinctions or differences in cases can only avail a party when they are germane or material to the stare decisis of the case. I say this because stare decisis which means to abide by or adhere to decided cases, as a policy of courts to stand by precedent, is based on a certain state of facts which are substantially the same and here the word is substantially. This means that the facts that give rise to the principle of stare decisis are the material facts, devoid of or without the unimportant details. This also means that the facts need not be on all fours in the sense of exactness or exactitude.
And I must say here that there can hardly be two cases where the facts are exactly the same, and the doctrine of stare decisis which has been built by the judicial system over the years does not say that the facts must be exactly the same. And so there could be inarticulate differences which will not necessarily be a poison in or to the application of the doctrine. One major criterion in the determination of the matter is that the facts of the previous case are major, substantial, and material to the facts of the current case begging for the application of the previous case. Before the application of the previous case, the Judge should ask a question: Could the court have arrived at the decision but for the particular facts or could the court have arrived at a different decision in the absence of the particular facts? An unequivocal answer to the above double barrel question will pave the way for the applicability or inapplicability of the doctrine. The case may have one ratio decidendi. As a matter of fact, most cases have more than one ratio decidendi. Ratio decidendi is tied to material facts and not just facts which are peripheral or intangible. In our legal practice, counsels make use of ratio decidendi that will be of use to their client's case, in the sense of giving their clients victory. It is the duty of the Judge to examine the totality of the case and arrive at the appropriate or correct ratio decidendi in the case.
I think I have theorized enough. I should go to the realities of the case and that takes me to the decision of this court in Mobil Oil Nigeria Ltd v. Akinfosile (supra) where Fatayi Williams, JSC (as he then was) said at page 221:
"As we have earlier pointed out, the agreement (Exhibit A) did not leave the duration of the contract at large. In fact, it is clearly stated in clause 3(b) thereof that either party could terminate it merely by giving one month's notice. In our view therefore, the only damages which with justification could be said to have area out of the peremptory termination of the Agreement by me defendant/applicant is that resulting from their failure to give the plaintiffs\respondent one month's notice. In other words it is to be determined by what he would have earned had he been given due notice"
Like in Mobil Oil (Nig) Ltd., this case involved breach of an agreement. While that agreement was Exhibit A in Mobil, it is Exhibit B in this appeal .Again like in Mobil, the breach was failure to give the respondent a month's notice; the distinction made by appellant in paragraph 4.24 and 4.25 is to no avail. The Court of Appeal correctly identified the relevant ratio decidendi and correctly applied it.
That takes me to Issue No. 2 formulated by the appellant. It has to do with the award of special damages for wrongful detention of appellant's empty bottles of assorted products. The learned trial Judge said at pages 146 and 147 of the Record:
"The plaintiff in leg two is asking for an order that the defendant should deliver to the plaintiff 1,900 cartons of assorted products as set out in paragraph 9 of its statement of claim or its current market value of
The learned trial Judge gave judgment to the plaintiff as in pages 150 and 151 of the Record.
The Court of Appeal, with the greatest respect, from nowhere, introduced the law of bailment and held that the findings of the learned trial Judge were perverse having been based on wrong principles. The court set aside the awards. Let me quote a bit of what the Court of Appeal said at pages 239 and 240 of the Record:
"The bottles are in form of bailment which arises by way of contract wherein the delivery of personal property by one person (the bailer) to another (the bailee) who holds the property for a certain purpose under the express or implied ...contract. From the evidence adduced the appellant is the bailer whilst the respondent is the bailee... In the instant appeal as the contract of bailment is tied to purchase of products of appellant with content and their credit given to respondent and no evidence of payment separately for bottles the learned trial Judge erred in law to have awarded the bailee the cost of the goods entrusted to by the bailer when the purpose for the delivery has not materialised so after careful consideration of the pleadings and the evidence I find the findings to be perverse with the award of the sum of
As correctly contended by learned counsel for the appellant, none of the parties claimed on bailment. The plaintiff in its statement of claim did not claim on bailment. So too the defendant in its counter claim. And so, how and why did the Court of Appeal go into the law of bailment to set aside the award of
It is good law that parties, the owners of their cases, are in the best position to know their claims or reliefs and the courts cannot go outside the claims or reliefs in search for other clams or reliefs not before them. The role of a court of law is to adjudicate on the claims or reliefs placed before it by the parties.
A claim or relief is made at the trial court and this is in the pleadings. The statement of claim contains the claim or relief. If the defendant has E. counter claim, this is contained in the statement of defence. The trial Judge goes into the pleadings and decides one way or the other. An appellate court has to go into the Record and decide only on the Record. An appellate court has no jurisdiction to go outside the record to search for possible claim or relief. It is sad that the Court of Appeal introduced the law of bailment suomotu in its judgment and resolved it suomotu. The parties were not given any opportunity to address the court on the law of bailment. That is never done and it is bad that the Court of Appeal did so. I will say no more.
And that takes me to the issue whether the rule and the decision in Hadley v. Baxendale has a binding effect in Nigerian court. The straightforward answer is that decisions of English courts or any foreign court are not binding on Nigerian courts. They are merely of persuasive authority. See Dada v. The State (1977) NCLR 135; Elioclin Nig. Ltd v. Mbadiwe (1986) 1 NWLR (Pt. 14) 47; National Supply Co. Ltd, v. AlhajiHamajoda Sabana Co. Ltd (1938) 5 NWLR (Pt.40) 2005; Senator Adesanya v. President of the Federal Republic of Nigeria (1982) 2 NCLR 358.
Although this court is not bound by the decision in Hadly v. Baxendale, I will persuade myself any day to use the beautiful principle stated therein.
The learned trial Judge without justification awarded a large sum of
Judgment delivered by Slyverster Umaru Onu, J.S.C.
I have been privileged to read before now the leading judgment of my learned brother Tobi, JSC just delivered, I am in agreement with him that the appeal is meritorious and ought to succeed in part.
The Court of Appeal (hereinafter referred to as the court below) in setting aside the award of
"It is common ground that Appellant owned the franchise on the empty bottles but possession was in respondent by way of deposit towards the cost of purchase of Appellants' product.
In the custom of trade of the business between the parties, the empty bottles are owned by the Appellant who put liquid content to be sold to respondent in the sale the cost of the empty bottles is given as credit note with the amount deducted from the overall price with respondent taking advantage of the credit note. The bottles are in form of bailment which arises by way of contract wherein the delivery of personal property by one person (the bailor) to another (the bailee) who holds the properly for a certain purpose under an express or implied term of contract. From the evidence adduced, the appellant is the bailor whilst the respondent is the bailee.
In the instant appeal as the contract of bailment is tied to purchase of product of the appe |