African Continental Bank Ltd. & Anor V. T. 0. Oladapo & Anor (1951)

LawGlobal Hub Judgment Report – West African Court of Appeal

Documents purporting to be a Bill of Sale invalid and void—Wrongful detention of lorry under such Bill of Sale—Measure of damages—Lender has right to sue for money lent and reasonable interest thereon independently of Bill of Sale.

Facts

These were appeals in cross-actions. The respondent in the first action is hereinafter referred to as the plaintiff and the appellant in that action is hereinafter referred to as the defendant.

The plaintiff sued the defendants for damages for wrongful detention of a lorry which had been seized under a document purporting to be a Bill of Sale, and was awarded damages for the wrongful seizure and detention.

The defendants in the second action sued the plaintiff for moneys due on the plaintiff’s banking account with the defendants. The trial Judge held that the defendants were not entitled to recover moneys advanced to the plaintiff to purchase the lorry on the strength of a Bill of Sale which he held to be void in toto.

On the appeal the trial Judge’s assessment of damages was questioned, and it was argued for the defendants that, although the Bill of Sale was void, there was an implied agreement to repay the money lent, with interest at a reasonable rate, independently of the Bill of Sale.

Held

The damages had been awarded on wrong principles and the award of damages was amended. The Bill of Sale was void and the seizure illegal, and the grantor’s covenant for payment of interest was unenforceable. The circumstances were different from those relating to an illegal contract in which the parties have purported to do what the law prohibits. There was nothing illegal in the loan transaction but only that the security was void.

Independently of the Bill of Sale there remained an obligation to repay the money borrowed with interest at a reasonable rate.

Judgments in both suits varied.