⦿ CASE SUMMARY OF:
AFEGBAI v. ATTORNEY-GENERAL, EDO STATE AND ANOTHER (2001) – SC
⦿ LITE HOLDING
If the agreement which is the foundation of the consent judgement cannot be vitiated, then the consent judgement is proper.
⦿AREA OF LAW
Contract (fraudulent misrepresentation)
Authority of counsel.
Master & servant relationship.
Attorney-General, Edo State & Another
⦿ LEAD JUDGEMENT DELIVERED BY:
- FOR THE APPELLANT
- FOR THE RESPONDENT
⦿ FACT (as relating to the issues)
The facts are simple. Government acquired part of the plaintiff’s land at Isiohor near Ugbowo and the parcel of land remained acquired. The plaintiff went to court and sued for compensation to be paid to him in respect of the land. Compensation was not paid. While the case was in court the defendants negotiated settlement with the plaintiff’s Solicitor to give another parcel of land to the plaintiff in lieu of monetary compensation. The plaintiff, through his Solicitor acting as agent, accepted this proposal, the defendant produced the Certificate of Occupancy in favour of the plaintiff and delivered it to the court when the settlement was regarded as completed, and the terms were filed in court enrolled as the judgment of the court. It was a negotiated and settled agreement which led to a consent judgment of the court. Between the defendants and the plaintiff’s Solicitor, indeed the plaintiff himself, the matter was regarded as having been laid to rest. What then followed was that when the plaintiff’s case was still in court he applied to the defendant to make a grant to him out of the defendants land at their new layout land at Etete in Benin City. The plaintiff did not inform his Solicitor about this. The defendants agreed to make a grant of the plot of land to the plaintiff and use it to offset the compensation that the plaintiff had demanded on his acquired land at Isiohor. The problem that has arisen is that the plaintiff is contending that the grant of the plot to him had nothing to do with the demand of compensation for his land for which he sued the defendants, saying that if he knew that fact before the enrolment of the consent judgment he would not have agreed to it.
The Trial Court held: “I must say that from the facts before me fraud on the part of the defendants has not been proved. I accept the evidence of the defence witness, Mr Izilien, that the defendants issued a Certificate of Occupancy in respect of the land at Etete Layout and did so within two months of the application by the plaintiff in order to meet the terms of settlement in court.”
The Court of Appeal upheld the judgement of the Trial Court. The Plaintiff as Appellant has herein appealed.
- Whether the appellant had failed to prove the essential ingredients of fraudulent misrepresentation against the respondent?
⦿ RESOLUTION OF ISSUE(S)
[APPEAL: DISMISSED, with N10,000 cost]
- ISSUE 1 WAS RESOLVED AGAINST THE APPELLANT BUT IN FAVOUR OF THE RESPONDENT.
i. In my opinion, the view held by the Chief Judge, confirmed by the unanimous view of the Court of Appeal, that fraudulent misrepresentation had not been proved cannot be faulted having regard to the evidence accepted by the learned Chief Judge. The parties agreed that land would be allocated to the appellant in lieu of compensation. Mr Izilien and the appellant’s Solicitor agreed that Plot 263 would be such land allocated. There was neither representation made to the appellant’s agent nor falsity in any representation that Plot 263 had been allocated in lieu of compensation. If there was any falsity, it was in the claim of the appellant that there were two parallel and unrelated transactions. His error was, apparently, that he did not realise that even if land was to be allocated to him in lieu of compensation, he still had to go through the process of allocation and documentation. He admitted with candour that his applying for allocation of land was suggested and initiated by the respondent’s witness as part of the negotiation to grant him land in lieu of the compensation for land which was compulsorily acquired, but he did not seem to have attached any consequence to that fact.
⦿ ENDING NOTE BY LEAD JUSTICE – Per
This appeal, evidently, could have been shortly dealt with on the well established principle that this Court will not lightly interfere with concurrent findings of fact made by the trial court and the Court of Appeal, unless such findings are perverse and utterly unreasonable. Such is not the case in this appeal. It is merely in deference to the fact that there was a split decision of the Court of Appeal that time has been taken to give a considered judgment. It is well to note that it being the unanimous finding of the court below that there was no fraudulent misrepresentation, that should have been the end of the matter since that finding struck at the root of action. The finding in the dissenting judgment that land claimed to be allocated in lieu of compensation was at the time of such allocation already the property of the appellant is, on the evidence, erroneous and was not the basis of the appellant’s claim in the High Court.
⦿ SOME PROVISION(S)
Paragraph 1181, Halsbury’s Laws of England (4ed) to include:- “. . . the action and all matters incidental to it and to the conduct of the trial such as withdrawing the record, challenging the juror, calling or not calling witnesses, cross-examining or not cross-examining witnesses, consenting to a reference to arbitration, a compromise or a verdict, undertaking to appear, or on the hearing of a motion for a new trial, consenting to a reduction of damages. The client’s consent is not needed for a matter which is within the ordinary authority of Counsel, thus if in court, in the absence of the client, a compromise or settlement is entered into by Counsel whose authority has not been expressly limited, the client is bound.”
⦿ RELEVANT CASE(S)
In Huddersfield Banking Co Ltd v Henry Lister & Son Ltd [1895-9] All ER Rep 868 it was held that a consent order made by the court to give effect to the compromise of a legal claim by the parties concerned can be set aside, not only on ground of fraud, but for any reason which would afford a ground for setting aside the agreement on which the order was made, for example, on the ground of a common mistake regarding a material fact. In that case Lindley, CJ, said:- “The only thing, to my mind, to be done on this point of setting aside a consent judgment is to see whether the agreement upon which it was based can be invalidated or not. If the agreement cannot be invalidated, the consent order is good. If the agreement can be invalidated, the consent order is bad.”
In Swinfen v Swinfen 26 LJ Co P 97, Blackburn, J, stated the position as follows:- “Counsel therefore being ordinarily retained to conduct a cause without any limitation, the apparent authority with which he is clothed when he appears to conduct the cause is to do everything which in the exercise of his discretion, he may think best for the interest of his client in the conduct of the cause; and if within the limits of this apparent authority he enters into agreement with the opposite Counsel as to the cause, on every principle this agreement should be binding.”
⦿ CASE(S) RELATED
⦿ NOTABLE DICTA
It is only in exceptional circumstances that justices who have not seen a witness in the box ought to differ from the finding of fact of the Judge who tried the case as to the state of mind of the witness. – Ogwuegbu, JSC. Afegbai v. A.G Edo State (2001)
It may well be noted that the evidence of the appellant’s Solicitor who negotiated the settlement of the claim for compensation in his behalf confirmed that the “State partly promised to give to plaintiff another position (sic: portion) of land in Benin City in lieu of compensation due to plaintiff.” Then he also said that he went into negotiation whereon Mr Izilien identified to him Plot 263 as the plot of land he had decided to allocate to the appellant. He accepted the allocation and an agreement which he signed was accordingly drawn up. The appellant’s Solicitor confirmed that he had authority to accept any suitable compensation. His only objection was that the appellant’s property would not be a suitable compensation. The appellant himself admitted under cross-examination that he was advised to apply for an allocation of land when the acquisition of his land could not be rescinded. He therefore applied for land in October, 1984. – Ayoola, JSC. Afegbai v. A.G Edo State (2001)
A consent judgment will be set aside on any ground which may invalidate an agreement on which it is founded would be rescinded. When therefore, a consent judgment is sought to be set aside on the ground of fraudulent misrepresentation, the same principles apply as would apply were the action one for rescission of a contract. – Ayoola, JSC. Afegbai v. A.G Edo State (2001)
So we are concerned with the limited question whether fraudulent misrepresentation was established. In this well trodden area of law, the principles that apply in a claim for rescission of a contract for fraudulent misrepresentation need only be stated briefly. First, the representation must be a statement of existing fact. Secondly, the representation must be material and unambiguous. Thirdly, the representee must show that he has acted in reliance on the misrepresentation. Where there is no representation of an existing fact it will not be necessary to proceed to consider any question of falsity. Where there is misrepresentation it is essential for the purpose of relief to consider whether it is fraudulent or innocent and whether the representee had acted in reliance on the misrepresentation. – Ayoola, JSC. Afegbai v. A.G Edo State (2001)
Even if a statement is true in the sense in which the representor meant it but is so obscure that the representee understands it in another sense, in which it is untrue, the representor is not liable if his interpretation is the correct one. (See McInerny v Lloyds Bank Ltd (1994) 1 Lloyds Rep 246, 254). It has further been held that the representor is not guilty of fraud, even if the court holds that the representee’s interpretation was the correct one. (See Akerhielm v De Mare (1959) AC 789; Gross v Lewis Hillman Ltd (1970) Ch 445). – Ayoola, JSC. Afegbai v. A.G Edo State (2001)
Rescission of a contract cannot be based on a misinterpretation of the representor’s statement which on its true interpretation is not false. – Ayoola, JSC. Afegbai v. A.G Edo State (2001)
There is a consent judgment where parties to an action in court have fashioned out an agreement as to how to settle their dispute out of court and apply to the court to give judgment on the terms they have agreed upon. Such judgment when given is called a judgment by consent and serves as a final determination of the dispute between the parties. – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
A consent judgment is a final decision, since it finally determines the issues and dispute between the parties. (See NWRD v Jaiyesimi (1963) 1 All NLR 215). It is a final decision within Section 241(1)(a) of the Constitution 1999. However, leave of the High Court or of the Court of Appeal is required for the exercise of a right of appeal. (See Section 241(2)(c) of the Constitution 1999). – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
A judgment of court which finally settles the rights of the parties in the subject matter of the claim in the sense that it was not given in default of a Statement of Defence is a final judgment. – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
A consent judgment will not be set aside on grounds of unilateral mistake, unless the mistake was induced by fraud or misrepresentation. (See Akinwunmi v Idewu (1969) 1 All NLR 319). – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
It is obvious and not disputed that plaintiff was aware of the arrangement to settle out of court, the action instituted by him against the defendants. He was also aware that the arrangement was to allocate another piece of land to him in lieu of monetary compensation for his piece of land compulsorily acquired. This arrangement was acceptable to him and he instructed Mr R. A. Oluyede to represent him in the negotiation. Mr Oluyede entered into the negotiation, representing the plaintiff, signed the terms of agreement with the defendants in which Plot 263 Etete Lay-Out was allocated to plaintiff and as Counsel this agreement was entered as the judgment of the Court in the suit. The judgment so entered by consent of the parties is valid and enforceable. The fact that the terms of agreement were negotiated and the judgment entered by Counsel on behalf of plaintiff and not by the plaintiff himself with the defendants did not affect its validity by an iota. This is because plaintiff has given to his Counsel a general authority without limitation to act on his behalf and to represent him in the action. – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
The nature of the legal relationship between Counsel and his client, which exists in this case between plaintiff and PW1, his Counsel, is one of an independent contractor and not one of principal and agent. (See Performing Right Society Ltd v Mitchell & Booker Palais de Danse Ltd (1924) 1 KB 702 at page 365 per McCardie J). It is not that of master and servant. Counsel is clearly not a servant of his client. It is accepted that where a client gives specific instruction to Counsel, such instruction must be adhered to. Where the nature of the specific instruction is in conflict with the manner of discharging his professional skills and interferes with his control of how to conduct the case of his client, Counsel is entitled to return the brief to his client. Counsel who is in law, the dominis litis is not bound to obey any such instructions. It is in the exercise of his apparent general authority in the discharge of his professional duties to his client, to have complete control how such instructions are to be carried out, and over the conduct of the case. – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
In the instant case there is no averment that the authority of plaintiff’s Counsel to conduct the case on his behalf was withdrawn at any stage or limited by any general or specific instruction. Counsel to plaintiff therefore had throughout the conduct of the case general and apparent authority to conduct the case of the plaintiff in his discretion within his professional skill and in the best interest of the plaintiff. The consent of Counsel in the negotiation for settlement of the dispute out of court was with the consent of plaintiff. There was no averment that Counsel and the defendants were not ad idem, both in the terms of agreement to settle out of court and in entering the consent judgment in court. Plaintiff was therefore bound by whatever results from such negotiations. – Karibi-Whyte, JSC. Afegbai v. A.G Edo State (2001)
Turning now to the meaning of “fraud” in connection with representations, it is firmly settled that whenever a man makes a false statement which he does not actually and honestly believe to be true, that statement is, for purposes of civil liability, as fraudulent as if he had stated that which he did not know to be true, or knew or believed to be false. So, in Derry v Peek (1889) 14 AC 337 HL at 374, Lord Herschell in the judgment of the House of Lords succinctly stated that fraud is proved when it is shown that a false representation has been made by the representor (1) knowing, or (2) without belief in its truth, or (3) recklessly, careless whether it be true or false; the third case being but an instance of the second. – Iguh, JSC. Afegbai v. A.G Edo State (2001)