⦿ CASE SUMMARY OF:
Julius Berger Nigeria Plc & Anor v. Toki Rainbow Community Bank Ltd (2009) – CA
1. Julius Berger Nigeria Plc;
2. Peter Nwachuku
1. Toki Rainbow Community Bank Ltd
Court of Appeal
⦿ LEAD JUDGEMENT DELIVERED BY:
Mohammed Lawal Garba, J.C.A.
⦿ LAWYERS WHO ADVOCATED
* FOR THE APPELLANT
– A.A. Osara;
* FOR THE RESPONDENT
– N.N. Uko (Mrs.);
⦿ FACT (as relating to the issues)
That the 1st Appellant had issued two separate Local Purchase Orders (LPOs) to Pit-a-pat International Nigeria Ltd (the 2nd Defendant in the High court) for the supply of plastic jute bags and Haulage land off loading of 5/15m Aggregate from Isioqu Quarry to PHC respectively. To enable it meet and satisfy the LPO’s Pit-a-Pat International Nigeria Limited (to be called the company hereinafter) sought for and obtained money or loan from the Respondent to which the payments for the LPOs due to the company from the 1st Appellant were said to have been assigned. On the ground that the money taken on loan by the company was not paid back or repaid through the payment by the 1st Appellant, the Respondent took out the writ of summons against the Appellants as well as the company and its managing Director one Peter Morkah with several claims as amended endorsement thereto.
It is worthy of mention that the company and its managing Director did not file a statement of defence to the Respondents’ claim and so did not defend the action against them. The claims were made jointly and severally against all the four (4) Defendants set out in the writ of summons and the amended statement of claim by the Respondent.
On their part, the Appellants had in paragraph 13 of the statement of defence dated 24/9/99 raised a preliminary Objection to the claims against them on the following two (2) grounds:
(a) No privity of contract between the plaintiff and them, and
(b) That the 3rd defendant being an employee of the 4th Defendant to the knowledge of the Plaintiff is an agent of a disclosed principal.
The objection was taken after the hearing of evidence in the case and dismissed in the judgment appealed against. Being dissatisfied with the decision of the High Court, a Notice of Appeal against same was filed on the 16/1/06 by the learned counsel for the Appellants.
1. Whether the trial court was right to refuse to grant the preliminary objection raised by the 3rd and 4th defendants now appellants in paragraph 29 of the further amended statement of defence No. 2 dated the 19th April 2005?
2. Having regard to the evidence before the lower court whether the respondent established that there was an assignment of the proceeds of the contract to it and whether the condition for domiciliation was not a mere security for the loans and the instructions of the 2nd defendant a mere mandate or authority to pay.
3. The next issue to be determined is whether or not the Respondent had shown by the pleadings and evidence adduced at the trial, that the 1st Appellant had not discharged that assignment to the Respondent to be entitled to succeed in its claim.
⦿ HOLDING & RATIO DECIDENDI
[APPEAL: ALLOWED IN PART]
1. ISSUE 1 WAS RESOLVED AGAINST THE APPELLANT BUT IN FAVOUR OF THE RESPONDENT.
i. There is no pleading or claim in the Respondent’s writ of summons or the statement of claim based on the breach of any contract between the Respondent and the Appellants or any one of them. The issue of privity of contract between the two parties did not therefore arise in the claim against the Appellants. As far as the Respondent’s claims are concerned there is no dispute about the absence or nor existence of a contractual relationship between it and the Appellants. In the circumstances, the ground of the objection by the Appellants based on the issue of privity of contract between them and the Respondent is misplaced and therefore internable in this appeal.
ii. Since the issue of privity of contract between the parties is of no moment so is the second ground of the objection as set out in paragraph 29(ii) of the Appellants’ further amended statement of defence NO.2. The ground is that 2nd Appellant was an agent of 1st Appellant, a disclosed principal. In the absence of a contractual relationship, the issue of agency in respect of 2nd Appellant would not arise. The last ground of the objection is that the claims do not disclose a reasonable cause of action. The only reason offered by the learned counsel for the Appellants on the ground of objection is that there was no evidence of a demand for repayment of the loans by the Respondent before the action was filed. As it appears the argument is impotent and weak on the ground it was made. Perhaps, I should remind learned counsel that in law a cause of action is a fact or a construction of facts which when proved would entitle a plaintiff to a remedy against a defendant.
2. ISSUE 2 WAS RESOLVED AGAINST THE APPELLANT BUT IN FAVOUR OF THE RESPONDENT.
i. In law, the reaction of an assignee i.e acceptance or otherwise to the assignment is not a prerequisite for the validity and effectiveness of such an assignment. Though learned counsel for the Appellant had submitted that consent of an assignee is required for a valid assignment and referred to page 581 of Cheshire, Fifoot and Funston’s Law of contract, 14th Edition, the consent is only required where liability of a contractual obligation was to be transferred to a debtor. That is not the case here since it is benefits of the contract between the company and 1st Appellant that were transferred and not the liabilities. The company had no liabilities under the contract in question to be transferred to 3rd parties whose consent in such a situation would have been necessary in equity and law. That submission of learned counsel is therefore misplaced and inapplicable in the present appeal. The authorities cited in support of the submission are not helpful to the Appellants in the circumstance. As seen earlier, all that the law requires is that the assignee be put on notice in writing of the assignment.
3. FOR ISSUE 3 THE COURT OF APPEAL HELD:
“Specifically, DW1 said at page 52 of the notes of proceedings of the High Court under cross examination that. “That was why we replied to the two requests to that effect made by PIT-A-PAT that we will not pay to the plaintiff in respect of these two orders/contracts. If the Plaintiff comes before this court to say that 4th Defendant paid money in respect of these two contracts or any of them DIRECTLY to it, Plaintiff will be telling lies.” What the Appellants did in legal effect is to mutedly in pleadings and emphatically in evidence, admit the case of the Respondent that the 1st Appellant did not pay the benefits of the contract in question as directed by the company in Exhibit “G” to the Respondent. With such unambiguous admission, the Respondent was undoubtedly entitled to succeed in law and equity on the claims against the 1st Appellant for the recovery of the benefits assigned to it by the company in Exhibit ‘G’.”
“In the result, I answer and resolve the issue in two parts as follows: (a) There was no valid legal or equitable assignment of the benefits of the 1st contract on the LPO NO. B0004747 by the company vide Exhibit “D” to the Respondent to effectively transfer interests or title therein. (b) That there was a valid legal and equitable assignment of the benefits of the 2nd contact on LPO No. 48303 vide Exhibit “G” by the company to the Respondent which effectively transferred the interests or title therein to the Respondent. Consequently, the issue is resolved in the first part in favour of the Appellants while in the second part; it is resolved in favour of the Respondent”.
⦿ SOME PROVISIONS
⦿ RELEVANT CASES
UBA V. PENNY MART LTD (1992) 5 NWLR (part 240) 228 had this to say on the grant of an alternative claim: “Where an alternative claim is made in addition to a main claim it is only where the main claim has not been granted that the consideration and the granting of the alternative claim can arise. Both the main claim and the alternative claim cannot at the same time be granted.”
HELP (NIG.) LTD V. SILVER ANCHOR (NIG.) LTD (2006) ALL NWLR (part 311) 1833, per Mukhtar, JSC state thus at page 1855-6: “When a party makes a claim in the alternative, the belief is that he wants either of the relief sought, in which case when he is granted any of the relief, it suffices for the purpose of satisfying his claim.”
⦿ NOTABLE DICTA
Formulation of more than one (1) issue from a single ground of appeal is proliferating the issues which leads to repetition of arguments on simple points that in turn very often obsucate the real issues that require determination in an appeal. Proliferation of issues only leads to round about submissions on otherwise straight forward issues and tend to make the reading and appreciation of the points canvassed therein cumbersome. It adds no value whatsoever to the viability and efficiency of the issues so proliferated and that is one good reason why the court have always deprecated the practice. – Lawal Garba, J.C.A. Berger v. Toki (2009)
The now well known position of the law is that the Respondent (as plaintiffs) claim as contained in the writ of summons taken out and statement of claims filed in support thereof are the exclusive determinants of the competence of the claims or parties against whom they were made. – Lawal Garba, J.C.A. Berger v. Toki (2009)
This is because it is only when proper parties and competent claims were brought by the due process of the law before a court would that court have the requisite vires or judicial authority to entertain and determine same. – Lawal Garba, J.C.A. Berger v. Toki (2009)
In the ordinary and every day English language which the parties to this appeal used in the transactions leading to the dispute between them, assignment means to give something to some body for their use or benefit. It also may mean to transfer right, property or title from the person/s legally entitled to them to some body else for their benefit. – Lawal Garba, J.C.A. Berger v. Toki (2009)
The question I now ask is what in law are the essential requirements which make an assignment of such benefits, interests or title to property effective? Speaking generally, they include: (1) ownership of or entitlement to the benefits, interest, rights or title to property by the assignor; (2) the absolute transfer in writing of such benefits, interests, rights or title to property to person/named therein; (3) Where, as in the present appeal, the benefits, rights and interests are in possession or custody of 3rd party, there is the requirement that the assignor should notify that 3rd party in writing of the assignment. – Lawal Garba, J.C.A. Berger v. Toki (2009)
Furthermore it was held that the benefit of a contract is only assignable in cases where it can make no difference to the person on whom the obligation lies to which of two persons he is to discharge it. – Lawal Garba, J.C.A. Berger v. Toki (2009)
A party to a contract can in equity also assign a contractual right in one of two ways (a) he can inform the assignee that he transfers the chose to him or (b) he can instruct the debtor to discharge the Obligation by payment to or performance for, the assignee. Thus an agreement by traders or merchants with a Bank that payment for goods sold by them should be remitted direct by the purchasers to the Bank has been held to, constitute a valid equitable assignment of the amount to the Bank. – Lawal Garba, J.C.A. Berger v. Toki (2009)
Generally however, a mere direction by a creditor to his debtor to pay money to a third party is not necessarily an assignment unless the instructions can be said in their context text, to amount to an irrevocable mandate to the debtor. – Lawal Garba, J.C.A. Berger v. Toki (2009)