Oyebisi Afolabi Usenfowokan V. Sule Salami Idowu Asani Salami (Trading Under The Name And Style Of Sule Asani Brothers) (1969)

LawGlobal-Hub Lead Judgment Report

FATAYI-WILLIAMS, AG. J.S.C.

The appellant is the plaintiff in this action instituted in the High Court of Lagos. He claimed against the respondents who were the defendants thereto, jointly and severally, (i) declaration that he is the owner in equity of the property at No. 47 Idumagbo Avenue, Lagos; (ii) alternatively, that the purported sale of interest in the said property to the defendants is null and void and of no effect; and (iii) an order, [if claim (i) succeeds] that the defendants do convey the said property to the plaintiff.

By an order dated 16th May, 1966, sixteen other persons who claimed to be tenants of the plaintiff in respect of the property were joined as plaintiffs. Pleadings were ordered and were duly filed and delivered by the 1st plain-tiff and the defendants. Paragraphs 4, 5, 8, & 9 of the 1st plaintiffs Statement of claim read as follows:- “4. On or about October, 1962, the said Samson Talabi Onashile sold the said property to the Ist plaintiff for the sum of £10,000. The 1st plaintiff will rely on:- (i) the receipt of purchase for £5,000 dated 30th October, 1962; (ii) receipt of purchase for £2,000 dated 14th March, 1964; and (iii) the receipt of purchase for the balance of £3,000 dated 10th January, 1963; in support of the said sale. 5. In pursuance of the aforesaid sale of the said property in dispute to the 1st plaintiff, the said Samson Talabi Onashile put the 1st plaintiff in possession thereof and the 1st plaintiff is, and has remained in possession of the property in dispute ever since. 8. The defendants claim to be the purchaser of the right, title and interest of the said Samson Talabi Onashile by virtue of a certificate of title dated 11th of November, 1965 and issued in respect of a sale following the attachment pleaded in paragraph 5 or above. 9. The lst plaintiff will contend at the trial of this action that the defendants knew or ought to know of his equitable interest in the said property as he was in possession thereof through his tenants.” By their own statement of defence, the defendants joined issue with the plaintiffs in respect of the above averments, and averred in paragraphs 3, 4, & 5, therein as follows:- “3. Paragraphs 4, 5, 6, and 7 of the statement of claim are denied. The 1st and 2nd defendants have no knowledge of any purchase of the property by the plaintiff or of the plaintiff’s occupation of the said property nor were they notified of any communication of the Registrar of the High Court of Lagos by the plaintiff. 4. Paragraph 8 of the statement of claim is admitted and the 1st and 2nd defendants claim to be purchasers for value without notice under the said certificate of title which is duly registered under Title No. LO 5929 in the Lands Registry Lagos. 5. If, which is denied, the plaintiff had any equitable interest in the property whatsoever the 1st and 2nd defendants will contend that such interest has been extinguished or postponed by the 1st and 2nd defendants’’ purchase of the legal estate without notice of the plaintiff’s alleged interest”.

In addition the defendants counterclaimed as follows:- “The lst and 2nd defendants repeat paragraphs 1 to 5 of their defence and claim against all the plaintiffs a declaration that they are the lawful owners of No. 47, Idumagbo Avenue Lagos, and exclusively entitled to the rents and profits therefrom since the llth day of November, 1965.” At the trial, the 1st plaintiff gave evidence in support of his claim to the property and produced the three purchase receipts (exhibits `1, `2 & `3) which he said were given to him by Onashile when he paid each instalment of the purchase price. In answer to questions asked under cross-examination he explained the circumstances surrounding his purchase of the property. The tenants, joined by order of court as plaintiffs, neither testified nor called any evidence. The 1st defendant in his testimony for the defence described how the property in dispute was first sold to both the 2nd defendant and himself by the Barclays Bank in 1959. There was litigation over the sale and as a result the property had to be offered for sale again in 1965 by order of the High Court of Lagos. The defendants succeeded in buying the property a second time. After this second sale, the defendants lodged all their documents of title including the conveyance they first obtained from Barclays Bank and the certificate of purchase dated 14th July, 1965 (exh. ‘24’) with the Lands Registry in Lagos. There was no objection lodged against their application for registration which was advertised in the Federal Gazette. Eventually they obtained the certificate of title (exh. ‘25’). The 1st defendant then explained that before he bought the property he made enquiries both personally and also through his solicitor. He denied knowing anything about the 1st plaintiff either in connection with the property or at all until the commencement of these proceedings in the High Court. Finally he asked for the declaration claimed in his counter-claim. He was not cross-examined. The learned trial judge after considering the evidence adduced by both parties dismissed the plaintiffs’ case. He then entered judgment in favour of the defendants in terms of their counter claim. On the question as to the purchase of the property by the 1st plaintiff from Onashile, he observed as follows:- “The evidence of the 1st plaintiff on the matter is most incredible and I regard it as an obvious mendacity. In his examination-in-chief, he tendered exhibits `1, `2, and `3, the purchase receipts for the alleged sale to him of the property. Exhibit ‘1’ is for £5,000 Exhibit ‘2’ is for £2,000 and Exhibit ‘3’ is for £3,000 The total of £10,000 was alleged paid by him between 1962 and 1964. None of the payments was made by cheque. Mr. Onashile was not called as a witness to prove that he made the receipts, the exhibits ‘1’, ‘2’, and ‘3’. Further, Mr. Onashile was not called in support of the alleged sale.”

The learned trial judge then referred to the answers given by the Ist plaintiff to questions asked under cross-examination and commented:- (a) on the failure of the 4th plaintiff/witness, who was supposed to have been present when part of the purchase price was paid to Onashile, to testify as to the payment of any money; and (b) as to the conflict in the testimony of the plaintiffs’ witnesses as to the payment of rents to 1st plaintiff. Finally, he made the following findings regarding the sale:- “In the witness box and having regard to his demeanour, I am satisfied that the 1st plaintiff is not a witness of truth. The peculiar and secret purchase of the house by him from Mr. Onashile is not true. I am satisfied that there was no sale of the property to him. It is true that fraud was not pleaded in this case but the 1st plaintiff’s claim is in equity and the maxim of law is `He who comes to equity must come with clean hands.’ It is utterly incredible that a would-be purchaser, with the advice of a solicitor available to him, paid for a house over which the vendor said there was debt and litigation. The fact as I find it on the evidence is that there is no equity in the 1st plaintiff. He claimed to have bought the property and that he consulted a solicitor. He did not, in his evidence, state that he saw the title deed of the property although he stated that Mr. Onashile told him that there was a case over the house between him (Onashile) and the Barclays Bank. He did not pursue the matter further.

The purchase money of so high an amount was allegedly paid out most recklessly without the production of the title deed. Why did the plaintiff not pay the purchase money to the creditor? He neglected to get a conveyance in his own favour from Onashile. I do not find that the alleged sale from Mr. Onashile to the 1st plaintiff has been proved.” It is against this judgment that the 1st plaintiff [hereinafter referred to as the appellant] has now appealed to this Court. The six grounds of appeal filed were argued together but the main point taken by Chief Williams, for the appellant, is in the third ground of appeal which reads as follows:- “The learned trial judge erred in failing to observe that it was not open to him to make a finding which can only be justified on the basis that the purchase receipts issued by Onashile to the 1st plaintiff were `either forged or fictitious since such allegations were neither pleaded nor proved in the manner required by law.”

The main contention of Chief Williams is that once the appellant pleaded the purchase of the property and also the existence of the purchase receipts, a mere denial by the defendants (now respondents) in their statement of defence is a very thin defence. It could not constitute notice to the appellant that the receipts are false or fictitious, and as fraud was not pleaded by the respondents, the lower court was not, on the authority of the case of George & Ors v. Dominion Flour Mills [1963] 1 All N.L.R. p. 71 entitled to make a finding on it. It made no difference, argued Chief Williams, whether the suggestion of fraud came out during the cross-examination of the appellant. PAGE| 5 After referring to the finding of the learned trial judge as quoted above, he contended that when, in the face of the receipts exhibits ‘1’, `2, and `3, the court held that there was no sale, that could only mean that the receipts are fictitious, a finding which is clearly indicative of fraud in the civil sense on the part of the appellant who tendered them. Since fraud was not pleaded by the defence, this piece of evidence should have been ignored, particularly as the respondents could have applied to amend their pleadings but chose not to do so.

Finally learned counsel contended that since the court based its findings on a material fact not pleaded, the judgment should be set aside. In addition to the decision in George v. Dominion Flour Mills (supra) referred to earlier, learned counsel also referred us to two cases, namely The United Africa Co. Ltd. v. Taylor 2 W.A.C.A. 70 at p. 71 and Wallingford v. Mutual Society (1880) 5 A.C. 685 at p. 697. Mr. Impey, for the respondents, conceded that fraud was not pleaded. He contended, however, that the respondents could not have anticipated the facts which were suggestive of fraud which came out when the appellant was being cross-examined. He further contended that although not pleaded, the learned trial judge could not ignore evidence of fraud if it came out at the hearing and was not therefore in error when he referred to it in his judgment.

To conform with what came out at the hearing, learned counsel then applied to amend his pleadings. He also applied, in the alternative, that if the amendment was refused the case be sent back for retrial. It is common ground that fraud was not pleaded by the respondents and also that the finding of the learned trial judge both as to the payment of the purchase price by the appellant and also as to the three receipts was suggestive of fraud on the part of the appellant.

What calls for determination in this appeal therefore is whether it was open to the learned trial judge to advert to those facts in his judgment. It is settled law that any charge of fraud must be pleaded with the utmost particularity. As had been aptly pointed out by Thesiger, L.J. in Davy Bros. v. Garrett (1878) 7 Ch. D. 489:  “In the Common Law Courts no rule was more clearly settled than that fraud must be distinctly alleged and as distinctly proved, and that it was not allowable to leave fraud to be inferred from the facts.”

Again in United Africa Co. Ltd. v. Taylor (1936) 2, W.A.C.A. (PC.) 70 at p. 71, Lord Maugham, delivering the judgment of the Court, observed as follows:- “In the opinion of their Lordships there is no rule which is less subject to exception than the rule that charges of fraud, …. against a defendant ought not to be made at the hearing of “an action unless, in a case where there are pleadings, those charges have been definitely and clearly alleged, so that the defendant comes into Court prepared to meet them.”

PAGE| 6 In view of these cases, it seems to us that the learned trial judge should not have allowed the cross-examination of the appellant, albeit without objection, to follow the trend complained of. Moreover, having let in the answers he should have ignored or disregarded them as they went to no issue as settled by the pleadings. This view accords with the decision in George vs. Dominion Flour Mills Ltd. (supra) and also with the observations of the Federal Supreme Court in Idahosa & anor. vs. Oronsaye (1959) 4 F.S.C. 166 at p. 171; and in O.S. Bada vs. Chairman LE.D.B & 5 Ors. (Unreported but see S.C.501/65 of 23rd June, 1967) where this court observed inter alia as follows:-

“The evidence in regard to long possession did not pertain to matters arising out of the pleadings and so should have been ignored and rejected by the learned trial judge who should have confined himself to determining the issues raised by the pleadings, as was said by Lord Summer in North Western Salt Co. Ltd. v. Electrolytic Alkali Co. Ltd. [19141 A.C. 461 at p.48 I:- “Much of the oral evidence was strictly immaterial since, though obtained in cross-examination, it went to no issue.” In the case in hand the learned trial judge accepted and relied on the facts elicited from the appellant under cross-examination, when clearly those facts should have been ignored by him as not properly arising for consideration on the issues pleaded before him.

We are unable to come to any conclusion on what would have been the judgment of the learned trial judge had he considered only the evidence properly admitted and certainly this court cannot say whether he would have come to the same conclusions on those facts.

Some other points were raised in argument before us, including the fact that the other plaintiffs against whom the judgment went as well have not appealed, but in view of the decision at which we have arrived in the appeal we do not consider it necessary to say more on the appeal.

The appeal is allowed and the judgment of Caxton-Martins J. in Suit No. LD/107/66 including the order for costs is hereby set aside with respect to all the par-ties and the following orders are made:-

1. The case is hereby remitted to the High Court, Lagos for a hearing de novo before another judge.

2. The parties are at liberty if they be so advised to amend their pleadings.

3. The respondents shall pay to the Appellants the costs of this appeal assessed at 55 guineas and the costs of the parties in the court below shall abide the event.

Other Citation: (1969) LCN/1702(SC)