Brossette Manufacturing Nigeria Ltd v. M/S Ola Ilemobola Ltd. & Ors. (2007) – SC

⦿ CASE SUMMARY OF:
Brossette Manufacturing Nigeria Ltd v. M/S Ola Ilemobola Ltd. & Ors. (2007) – SC

by PipAr Chima


⦿ COURT & SUIT:
Supreme Court – SC.226/2001


⦿ JUDGEMENT DELIVERED ON:
11th May 2007


⦿ AREA(S) OF LAW
Inchoate interest;
Sublease;
Governor’s consent.


⦿ NOTABLE DICTA

* THERE HAS TO BE A CONTRACT FOR GOVERNOR’S CONSENT TO BE GIVEN
But the holder of a statutory right of occupancy is certainly not prohibited, by section 22(1) of the Land Use Act, 1978 from entering into some form of negotiation which may end with a written agreement for presentation to the Governor for his necessary consent. I think this is good sense because the Governor when giving his consent may require the holder of the statutory right of occupancy to submit an instrument executed in evidence of the assignment, mortgage sublease in order that his consent under subsection (1) may be signified by endorsement thereto. – Katsina-alu JSC. Brossette v. Ilemobola (2007)

* ORAL EVIDENCE NOT ADMISSIBLE WHERE DOCUMENT EXIST
Where there is documentary evidence on an aspect of a party’s case, no oral evidence is admissible on that aspect. This is because our adjectival law does not admit oral evidence on an aspect or area covered by a document. A party cannot benefit from two ways: documentary evidence and oral evidence. He can only lead evidence in respect of one and not the two of them. But this principle of law is subject to an important qualification and it is this. If the parties by their ad idem agree by oral agreement to change part of the written agreement, the court will not reject the oral agreement. – Niki Tobi, JSC. Brossette v. Ilemobola (2007)

* FAIR HEARING NOT BREACHED WHEN A DOCUMENT IS EXPUNGED BY TRIAL JUDGE
I have seen in recent times counsel forcing into cases the principles of fair hearing even when they are so distant from the case. The principles of fair hearing will not be invoked in favour of a party where the trial Judge correctly expunges an exhibit earlier admitted. It is only when the document is wrongly or wrongfully expunged from the record that a party can be heard to canvass to an appellate court that he was denied fair hearing.

* A TRIAL JUDGE MAY EXPUNGE DOCUMENT SUO MOTO
The law is elementary that a trial Judge has the right to expunge from the record a document which he wrongly or wrongfully admitted. He can do so suo motu at the point of writing judgment. He needs no prompting from any of the parties, although a party is free to call his attention to the document at the stage of address. Where a trial Judge is wrong in expunging a document, the appellate process will correct it and so an argument that the Judge ought to have expunged the document suo motu at the stage of writing judgment, will not avail the party wronged. After all, it is better for a Judge to expunge suo motu a document which is clearly inadmissible under the Evidence Act than allow it to be on the record to give headache to the appellate court. As the appellate court has the competence to expunge it from the record, why not the trial Judge? – Niki Tobi, JSC. Brossette v. Ilemobola (2007)

* INTERPRETATION OF S.22 LAND USE ACT
Firstly, the position of section 22 of the Act, is undoubtedly, that a holder of a right of occupancy, may enter into an agreement or contract, with a view to alienating his said right of occupancy. In entering into such an agreement or contract, he does not need the consent of the Governor. He merely operates within the first leg/stage of a “transfer on sale of an estate in land” which leg/stage ends with the formation of a binding contract for a sale constituting an estate contract at best. However, when he comes to embark on the next leg/stage of alienating or transferring his right of occupancy which is done or effected, by a conveyance or deed, which culminates in the vesting of the said right in the particular “purchaser”, he must obtain the consent of the Governor in order to make the transaction valid. If he fails to do so, then the transaction, is null and void under Section 22 of the Act. – Ogbuagu, JSC. Brossette v. Ilemobola (2007)

* AN AGREEMENT FOR A LEASE MUST BE DATED
Secondly, I note that exhibit 3, is/was not dated. It is now firmly established that for an agreement of a lease to be valid, it is essential that there must be an agreement on the date of commencement of the term. In other words, both the commencement and the maximum duration of the term must either be certain or capable of being rendered certain before the lease takes effect. In the case of Marshall v. Berridge (1881) 19 Ch.D 233 at 245, Lush, L.J. stated inter alia, as follows:- “There must be a certain beginning and a certain ending, otherwise it is not a perfect lease, and a contact for a lease must, in order to satisfy the statutes of frauds, contains those elements.” In the case of Harvey v. Pratt (1965) 2 All E.R. 786 at 788 CA, Lord Denning, stated inter alia, as follows:- “It is settled beyond question that, in order for there to be a valid agreement for a lease, the essentials are that there shall be determined not only the parties, the property, the length of the term and the rent, but also the date of its commencement.” – Ogbuagu, JSC. Brossette v. Ilemobola (2007)

* A DEED BECOMES EFFECTIVE UPON DELIVERY
This is because, in my respectful view, it is settled that a transaction created by a deed will not come into effect prior to the delivery of the deed. In other words, a deed only becomes effective upon its delivery. So, until the time specified had arrived or the condition had been performed or the Governor has given his consent, the instrument, will not be a deed so to speak, but is a mere escrow. – Ogbuagu, JSC. Brossette v. Ilemobola (2007)

* WHAT IS AN ESCROW?
What is an Escrow? In the book authority of Norton Upon Deeds, 1st Edition, page 15, Escrow is defined as follows:- “…an instrument be delivered to take effect on the happening of a specified event, or upon condition that it is not to be operative until some condition is performed, then pending the happening of the event or the performance of the condition, the instrument is called an Escrow ….. until the specified time has arrived or the condition has been performed the instrument is not a deed. It is a mere escrow.” The cases of Beesly v. Hallwood Estates Ltd. (1961) I Ch. 105 at 116; Xcnos v. Wickham (1867) L.R. 2 (H.L) 296 at 322; (1969) 1 All NLR 287 and Vincent v. Preno Enterprises Ltd (supra) are/were referred to. – Ogbuagu, JSC. Brossette v. Ilemobola (2007)


⦿ PARTIES

APPELLANT
Brossette Manufacturing Nigeria Ltd.

v.

RESPONDENT
M/S Ola Ilemobola Ltd. & Ors.


⦿ LEAD JUDGEMENT DELIVERED BY:
A. I. Katsina-alu, JSC


⦿ APPEARANCES

* FOR THE APPELLANT

* FOR THE RESPONDENT


⦿ CASE HISTORY
The plaintiff was granted the right of occupancy over Plot No. 4 Maichibi Close on 21 September 1977. Sometime in the year 1981, it extended into a Lease Agreement with the 4th defendant for a ten year period. The consideration was ₦18,000.00 per annum. By the plaintiff’s admission, it was paid the sum of ₦180,000.00 for the ten year period. The plaintiff, however, neglected to apply to the Governor for consent to lease. It nonetheless put the 4th defendant into possession of the property. The 4th defendant complained to the Governor of Kaduna State. After exchange of correspondence, the Governor having satisfied himself that the refusal of the plaintiff to apply for requisite consent was willful, revoked the right of occupancy granted to the plaintiff.

The plaintiff essentially brought this action challenging the revocation of the statutory right of occupancy over a plot of land known as Plot No. 4, Kaduna South, Maichibi Close, Industrial Estate Kaduna.

At the close of pleadings, parties called evidence and addressed the trial court. In the course of his address, learned counsel for plaintiff abandoned the prayer for damages.

In his judgment delivered on 3 November, 1993, the learned trial Judge held that the revocation order was valid and consequently dismissed the plaintiff’s action.

The plaintiff appealed against the dismissal of his claim to the Court of Appeal. The plaintiff’s appeal was allowed.

Being dissatisfied with the judgment of the Court of Appeal, the 4th defendant, Brossette Manufacturing Nigeria Ltd. has appealed to this court.


⦿ ISSUE(S) & RESOLUTION

[APPEAL: DISMISSED]

1. Whether the 1st respondent as plaintiff and holder of the statutory right of occupancy over the land in question had alienated his right of occupancy or part thereof by sublease without the consent of the Governor first had and obtained?

RULING:
I. It will be seen clearly that the plaintiff led evidence in line with its pleadings. That there were negotiations between the plaintiff and the 4th defendant which ended with a written agreement for presentation to the Governor for his necessary consent. That is to say that the sublease agreement was understood and entered into subject to the consent of the Governor. It was against this state of affairs that the Governor of Kaduna State revoked the plaintiff’s certificate of occupancy over No. 4 Maichibi Close, Southern Kaduna.

II. The Court of Appeal in the course of its judgment held as follows: “Section 22 of the Land Use Act, Cap. 202 of the Laws of Federation of Nigeria, 1990 does not render null and void or illegal a purported sublease, such an agreement would only be dormant or inchoate and creates no legal relationship until the requisite consent is sought and obtained from the appropriate authority. That this was the intention of the appellant was quite manifest from his testimony before the learned trial Judge. Section 22(2) of the Land Use Act envisages a situation whereby some form of agreement would be presented to the Governor to which he would consent or with-hold his consent. It is not likely to be the intention of the maker of the enactment for the Governor to accede to a mere intention of the parties. I think some concrete terms should be agreed to by the patties for presentation to the Governor. In my respectful opinion what the appellant and fourth respondent did in exhibit 3 substantial compliance with provisions of section 22 of the Land Use Act.”
One can hardly fault the views expressed above. I agree entirely with the Court of Appeal. In the result I find that there was nothing contrary to law in entering into written agreement for the sublease before the Governor’s consent was obtained.


⦿ ENDING NOTE BY LEAD JUSTICE – Per

⦿ REFERENCED (STATUTE)
Section 22(1), 26, of the Land Use Act 1978.


⦿ REFERENCED (CASE)

* AN ESCROW CANNOT PASS AN INTEREST IN PROPERTY
Anambra State Housing Development Corporation v. Emekwue (1996) 1 SCNJ 98 at 132-133; (1996) 1 NWLR (Pt. 426) 505 where this court held as follows:- “Being a mere escrow, therefore, the Deed of Lease passed no interest in the property to the defendant. It follows therefore that whatever view one takes of exhibit they did not pass any interest in the property here concerned to the defendant and he consequently acquired no legal title to the property.”


⦿ REFERENCED (OTHERS)