New Nigeria Bank Ltd. V. J. A. Edoma & Ors (2000)
LawGlobal-Hub Lead Judgment Report
BA’ABA, J.C.A.
This is an appeal against the judgment of the Bendel State High Court sitting in Benin Judicial Division delivered on 23/3/89 in suit No.B/22/87. The 1st respondent who was the plaintiff before the trial court claimed against the appellant who was the 2nd defendant in paragraphs 19 and 20 of the amended statement of claim as follows:-
“(i) Whereof the plaintiff claims the said sum of N139,036.78 and interest at the rate of 6% per annum from 20th October, 1981 until the whole debt is paid off.
(ii) The plaintiff can pay the amount claimed plus interest and costs.”
Pleadings were ordered, amended and exchanged by parties. The parties called no witness but their counsel consented to admit all documents presented by the plaintiff/1st respondent. Thereafter, counsel addressed the court.
The learned trial Judge, E. Akpomudjere, J. delivered judgment on the 23rd day of March, 1989 and inter alia held:
“I am satisfied that the plaintiff has proved his case against the defendants as required by law and judgment is entered in its favour against the defendants jointly and severally for the sum of N139,036.78 with costs of N350,00.”
The facts of this case are simple and not in dispute between the parties, is as follows:-
The plaintiff, Onward Paper Mill Limited, is a major exercise and notebooks manufacturing company. The 1st defendant, J. A. Edoma, (Trading under the name and style of Green Sanders & Co. Nig.) secured a contract to supply notebooks and exercise books to the Bendel State Government. The plaintiff who is the 1st respondent in this appeal, demanded for an assurance of payment before supplying the 1st defendant with any notebook or exercise book in a letter dated 25/2/81 admitted in evidence as Exhibit “C1”. The 1st defendant thereafter secured an assurance or undertaking to pay the plaintiff through a letter from the New Nigeria Bank Limited, the 2nd defendant/appellant by a letter dated 6th August, 1981 admitted in evidence as Exhibit “C”. The plaintiff thereafter, supplied the said books to the Bendel State Government which duly accepted them. The Managers of the 1st defendant signed C2 and a letter dated 28th May, 1981, also admitted as Exhibit “C3”. The outstanding sum of N139,036.78 was owed by all the defendants to the plaintiff hence the institution of this appeal. Aggrieved by the decision, the 2nd defendant/appellant appealed to this court by a notice of appeal filed on 13/4/89 containing two grounds of appeal which read as follows:-
(i) The learned trial Judge erred in law when he held that the documents exhibits C2 and C3 constituted a guarantee by the 2nd defendant/appellant in the event of the failure of 1st defendant to pay same.
(ii) The judgment is against the weight of evidence.
When the appeal came up for hearing on 17/2/2000, all the three counsel representing the parties adopted and relied on their respective briefs of argument. From the two grounds of appeal, the appellant formulated the following issues for determination.
(a) Does the letter Exhibit C2 constitute a guarantee in strictu sensu between the appellant and the respondent when it was not made under seals?
(b) If the answer to issue No. 1 above is YES, then is the appellant’s honouring of the letter not based upon the happening of an event to wit: the receipt of payment from Bendel State Government by the appellant into 1st defendant’s account with the appellant?
(c) Finally, is the appellant bound to pay the sum of N139,036.78 to the respondent on behalf of the 1st defendant on the basis of Exhibit C2 when as a matter of fact, the condition in Exhibit C2 i.e. the money had not been paid into 1st defendant’s account with appellant by the Bendel State Government or at all?
The 1st respondent in his brief formulated only one issue which reads:-
“1. Whether the learned trial Judge was right in holding the appellant liable jointly and severally with the other defendants to the claim based on the undertakings, representations and assurance in exhibits C2 and C3.”
In the 3rd respondent’s brief of argument the issue formulated for determination is as follows:-
“Whether the 3rd respondent is bound by an unknown contract made between the plaintiff, 1st and 2nd defendants whereby the appellant made an undertaking to guarantee the action of the 1st defendant.”
The learned counsel for the appellant in his brief of argument submitted that Exhibit C2 is not a guarantee but if anything it is an undertaking. He further submitted that, the Manager who signed Exhibit C2 has no authority and there is no evidence that the conditions spelt out in Exhibit 3 had been complied with by the respondent. He contended that only the Directors or Chief Executive Officers of the appellant can sign guarantee which must be under the appellant’s common seal before it binds the appellant.
The learned counsel for the 1st respondent, in his brief of argument, submitted that the learned trial Judge was right in holding that the joint effect of Exhibits C2 and C3 were to make the appellant liable for the debt of N139,036.78 with cost of N350.00. On the issue of the capacity of the Managers of the appellant to sign Exhibits C2 and C3, learned counsel for the 1st respondent, submitted that the appellant did not plead that issue and it is trite law that parties are bound by their pleadings. He further submitted that evidence was not led at all in this case by the parties consequently there was no evidence on the issue of capacity of the Managers to sign the said Exhibits. Learned counsel urged us to dismiss the appeal as the appellant did not deny the supply and acceptance of the books by the 1st respondent. Since the issue formulated by the 3rd respondent does not appear to be based on the grounds of appeal, I will ignore the submission of the 3rd respondent on the issue which is incompetent as it is not tied to a ground of appeal. The learned counsel for the 3rd respondent however, stated in the 3rd respondent’s brief that the 1st defendant was a customer to the appellant and that guaranteed the contract to supply books but without the knowledge of the 3rd respondent.
The learned trial Judge in his judgment at pages 51-58 of record held;
“Regarding the argument of counsel for the 2nd defendant about its guarantee, I have examined Exhibits C2 and C3 very carefully and hold the view that the 2nd defendant was not merely to set as a conduit pipe in the whole arrangement as contended by counsel for the 2nd defendant. The 2nd defendant would have made all its charges sticking out its neck in the type of deal that was involved. Also there was no evidence from the 2nd defendant that the Manager who signed Exhibit C2 had no capacity to sign on behalf of the 2nd defendant. I am in agreement with the submission of counsel for the 1st defendant that the 2nd defendant cannot extricate itself from liability in this matter.
I am satisfied that the plaintiff has proved its case against the defendants as required by law and judgment is entered in its favour against the defendant jointly and severally for the sum of N139,036.78 with cost of N350.00.”
Before embarking on the consideration of the issues, I would like to state that there is a proliferation of issues in this appeal. The appellant, filed only two grounds of appeal, the second ground of appeal is the omnibus ground of appeal; whereas no evidence was led at all by the parties before the trial court and formulated three issues for determination from the one ground of appeal, in other words having more issues than the grounds. It is wrong for counsel to formulate issues for determination in excess of the grounds of appeal filed. Nevertheless, I will proceed to consider the appeal on its merits as no objection was raised before us on the matter.
It appears to me that the issues formulated by the appellant are academic, having accepted in his brief that Exhibits C2 and C3 which form the basis of the action against the appellant are undertakings not a guarantee. It should be noted that the suit against the appellant and two others is for a claim of the cost of exercise and note books, jointly and severally against the parties.
In my view, Exhibits C2 and C3, which I have carefully studied, here established the connection between the appellant and the 1st respondent justifying the institution of the action against the appellant as 2nd defendant. I am therefore in complete agreement with judgment of the learned trial Judge and I also hold that the appellant is estopped from denying Exhibits C2 and C3 and the effect of the said exhibits. I am fortified in holding that view by the decision of the Supreme Court of Nigeria, in Nassar and Sons (Nig) Ltd. v. L.E.D.B. (1959) SCNLR 607, (1959) 4 FSC 242, 250-251, cited in the 1st respondent’s brief where the court inter alia held;
“It is impossible to commend the Board for what took place at the time when the appellants were, to its knowledge, negotiating for the assignment of the lease, but I do not consider the Board owed any duty to the appellants on which an estoppel can be founded. Oral authority for development was not sufficient, and the appellants should have known this. It is otherwise, however, as regards the letter to the Bank. The Board was under no obligation to inform the Bank of the stage which negotiations had reached, and it can hardly have supposed that the Bank asked for the information out of idle curiosity. In the absence of evidence to the contrary it seems to me clear that the Board knew that the Bank was likely to allow the appellants to incur additional liabilities in consequence of the letter and intended that the letter should influence the Bank in reaching its decision. This being so, I consider that the Board is now estopped from submitting that the appellants are not entitled to any compensation at all.”
The main function of an Appeal Court, in my view, is in the first place, to determine whether an error has been committed by the trial court. If it finds such an error committed, it will then consider its gravity and magnitude to justify the reversal of the judgment of the trial court. It is not every error committed by a trial court that would automatically lead to reversal of its decision. Such an error must have substantially and materially affected the decision of the trial court.
In the instant appeal, I have already held that the learned trial Judge was right in his decision and even if I am wrong (I believe I am not), I hold that the error is neither substantial nor material to warrant the reversal of the judgment of the trial court.
In the result, having regard to the foregoing, I hold that the appeal lacks merit and is hereby dismissed, I hereby affirm the judgment of E. Akpomudjere, J., delivered on the 23/3/89, Appellant to pay costs assessed at N2,000.00 to each respondent.
Other Citations: (2000)LCN/0792(CA)
