Electricity Corporation Of Nigeria V Chief M. A. Okupe (1967)

LawGlobal-Hub Lead Judgment Report

COKER,J.S.C

The appellants are the plaintiffs in action instituted in the High Court of Lagos against the respondent who was the defendant thereto and in which the writ was endorsed as follows:-

‘1. The plaintiff claims the sum of £ 14,000 (fourteen thousand pounds) against the defendant as obligor under a bond dated 19th day of November, 1963, whereby the defendant became bound to the plaintiff in the sum of £ 14,000 (fourteen thousand pounds) to be paid by the defendant to the plaintiff subject to a condition there under written that if the defendant should execute in favour of the plaintiff a Deed of Conveyance transferring the fee simple absolute and in possession to fourteen acres of land at IKATE, ITIRE, more properly described in Plan No. ECN/WR/41 and there is no failure of the defendants title due to any case whatsoever then the said bond should be void.

2. The defendant has failed to establish his paramountcy of title and in spite of repeated demands by the plaintiff; has failed to execute the said Deed of Conveyance and has failed to pay to the plaintiff the said £14,000 (fourteen thousand pounds) whereby the said bond became due.’

Pleadings were ordered and filed. Paragraphs 8, 9 and 10 of the plaintiffs Statement of Claim read as follows:-

‘8. The defendant entered into a bond on the 19th day of November, 1963 to repay to the plaintiffs the said £ 14,000 (fourteen thousand pounds) should he fail to execute a deed of conveyance in favour of the plaintiffs at the request of the plaintiffs or should there be any failure of the defendants title due to any case whatsoever.

9. That the defendant in spite of repeated demands by the plaintiffs has failed to execute the said deed of conveyance.

10. That the said land at Ikate, Itire, more properly described in plan number ECN/WR/41 dated the 8th day of July, 1964, is in the effective occupation of other third parties, and is part of the land forming the Area Of Law of Suit No. IK/92/63 between I. S. John versus Aderogba Ajao and Others.’

By his own Statement of Defence the defendant joined issue with the plaintiffs on those three paragraphs; at the trial both parties gave oral evidence in support of their pleadings and the plaintiffs in addition produced some documentary evidence. One of the documents produced in evidence by the plaintiffs is the bond on which the action was based. It was admitted in evidence as Exhibit E and is in the following terms:-

‘BY THIS BOND, I, Chief M. A. Okupe, Managing Director of Agbonmagbe Bank Ltd., 162 Herbert Macaulay Street, Ebute Metta, Lagos, Nigeria (herein after called the vendor which term shall, where the context so admits, include his heirs and successors in title) am held and firmly bound to the Electricity Corporation of Nigeria, a body corporate duly established and incorporated under the Electricity Corporation of Nigeria Act No. 15 of 1950, (hereinafter called the purchasers which term shall where the context so admits, include the assigns and successors in title of the Purchasers) for the payment to them of the sum of £14,000 (fourteen thousand pounds), the purchase price of fourteen acres of land which is held by the vendor for an estate in fee simple in possession free from encumbrances at Ikate, Itire and which forms part of all that parcel of land described in the conveyance dated the 9th day of June, 1962, and registered as No. 16 at page 16 in vol. 561 in the Lands Registry Office at Ibadan, Western Nigeria.

Sealed with my Seal this 19th day of November, 1963.

WHEREAS the purchasers have this day at the request of the vendor paid to him the sum of £14,000 (the receipt of which sum the vendor hereby acknowledges) upon an express agreement that the vendor shall execute in favour of the purchasers as soon as this is ready, a Deed of Conveyance of the said area and piece of land at Ikate.

NOW THE CONDITION of the above written Bond is such that if the vendor shall execute in favour of the purchasers as soon as called upon to do so, the said Deed of Conveyance, and if there is no failure of vendors title due to any case whatsoever, then the above written Bond shall be void but otherwise, the same shall remain in full force and effect.’

After hearing evidence from both sides, the learned trial judge in a considered judgement dismissed with costs the plaintiffs action and the present appeal is from that judgement.

Before us on appeal, it was contended on behalf of the plaintiffs that the defendant was in breach of the conditions of the bond and the bond should have been estreated and judgement given against him. For the defendant it was submitted that it was for the plaintiffs to establish that there was a breach of the condition of the bond and that they had failed to do so.

Learned counsel for the plaintiffs argued as follows:-

(a) (i) That the recital in the bond shows that the defendant possessed an estate in fee simple absolute in possession free from encumbrances in the land concerned; that such recital should be read as part of the condition of the bond; that as there was some litigation over the land the defendants estate is not therefore free from encumbrances and the defendant is in breach of the condition of the bond;

(a) (ii) That the conveyance recited in the bond was the one on which the defendant had based his covenant and inasmuch as he had had to obtain a further conveyance from another vendor in respect of the same land, that was an acknowledgement that his title as recited in the bond was defective and constituted a breach of the condition of the bond; and

(b) That the defendant covenanted to execute a conveyance of the land to the plaintiffs if and when called upon to do so; that the plaintiffs had requested him to execute such a conveyance to them but he has failed or neglected to do so.

With respect to (a), counsel referred to a portion of .the introductory recital in the bond concerning the amount of £14,000 paid to the defendant and the description of the land concerned, i.e.

‘ … the sum of £14,000 (fourteen thousand pounds) the purchase price of fourteen acres of land which is held by the vendor for an estate in fee simple in possession free from encumbrances at Ikate, Itire and which forms part of all that parcel of land described in the conveyance dated the 9th day of June, 1962, and registered as No. 16 at page 16 in vol. 561 in the Lands Registry Office at Ibadan, Western Nigeria.’

Counsel referred us to a passage in Halsburys Laws of England, 3rd edition, volume 3, page 337, paragraph 639. We have read this passage and we are satisfied that the passage means no more than that the recitals can and do control the conditions of a bond, especially where the wording of the condition is neither clear nor unambiguous. In the present case, the condition is clear and unambiguous and we do not think that it was necessary to import the recitals into the condition. This much is also stated in the passage on which learned counsel has relied in addressing us.

Counsel further urged upon us that the learned trial judge was wrong to take the view that the plaintiffs already knew all about the nature of the defendants title and the defects in that title before they entered into the contract to purchase the land from him. We were referred by counsel on this point to several passages in the judgement and to a number of authorities including the judgement of Romer, J., in Jones v. Barnett [1899] 1 Ch. 611. Counsel pointed out that the defendant had not pleaded estoppel in his defence and that the judge should not have held the plaintiffs estopped by their previous knowledge about his title. We do not think that the argument covers the point. Undoubtedly the obligor on a bond is bound by the recitals where those recitals, as in this case, are clear and unambiguous and it goes without any doubt that a defect in title may be of such a serious nature as to be tantamount to a total failure of such title; but the question in this case is a different one and the plaintiffs Statement of Claim clearly states that the defendants title has wholly failed. The reason given in evidence for this is the existence of certain litigation over the land and the pleadings in that case were produced in evidence. The defendant is not a party to that litigation and although it was given in evidence on behalf of the plaintiffs that there were certain other persons claiming the land, it was not established that these persons were claiming through or against the defendant. Counsel for the plaintiffs rightly submitted that in this action the court could only look at the bond and that the contract for sale of land was only indirectly relevant.

We are in agreement with him on this submission and we take the view that the plaintiffs must be confined to their pleadings: and the breach of which they complained as set out in paragraph 9 of their Statement of Claim. On that pleading it is manifest that the burden of establishing an infraction of the condition of the bond lies squarely upon them. The question here, therefore, is not whether the existence of this litigation would have entitled the plaintiffs to rescind a contract for a sale of the land but whether the plaintiffs succeeded in establishing affirmatively while the litigation was still undetermined that the vendors title had failed. We do not consider that they did and the case of Jones v. Barnett (supra) on which the plaintiffs relied does not appear to help them on this issue.

Furthermore, counsel referred us to portions of the evidence showing that the defendant did obtain a further conveyance of the land in respect of which he was paid £14,000 from one Isaac John. The conveyance recited in the bond was produc

Other Citation: (1967) LCN/1544(SC)