When Will an Agent Be Liable for The Act of The Principal?

CASE TITLE: ERIC PAC (NIG.) LTD V. UNTOUCHABLE (2024) LPELR-62000(CA)
JUDGMENT DATE: 28TH MARCH, 2024
PRACTICE AREA: CIVIL PROCEDURE
LEAD JUDGMENT: HADIZA RABIU SHAGARI, J.C.A.

SUMMARY OF JUDGMENT:

INTRODUCTION:

This appeal borders on Joinder of Parties.

FACTS:

This is an appeal against the ruling of the High Court of the Federal Capital Authority sitting in Apo Judicial Division in suit no: FCT/HC/CV/1319/2018, delivered by Hon. Justice A. O. Otaluka on June 17, 2019, where the trial Court entered judgment in favour of the Respondent against the Appellant.

The Appellants were the plaintiffs while the Respondents were the defendants at the trial Court. The Appellant vide a writ of summons filed an action against the 1st Respondent for trespassionnto the appellant’s plot of land known as plot 1888 Sabon Lugbe East Extension, Lugbe, Abuja, and for injunctive reliefs and damages as well.

Upon being served with the originating processes, the 1st Respondent filed his statement of defence, in which he claimed that the plot in dispute was sold to him and his church ministry through a deed of conveyance executed between his company, E & E Bestways Nig Ltd, and one Adamu Yusuf Gulma. It is claimed that Adamu Yusuf Gulma had earlier acquired the land from the original allotee, Zambezie Trust Ltd., in 2008.

Subsequently, the 1st Respondent filed a motion on notice seeking an order of the trial Court joining E & E Best Ways Nig Ltd., Adamu Yusuf Gulma, and Zambezie Trust Ltd. as co-defendants to the suit and an order of the trial Court striking out the name of the 1st Respondent from the suit as an agent of a disclosed principal. In response, the appellant filed a counter-affidavit dated March 25, 2019 and a written address in opposition to the Motion on Notice.

The reliefs sought are as follows:

a. An Order joining the 2nd, 3rd and 4th persons described herein as parties sought to be joined as co-defendants in this suit.

b. An Order striking out the name of the Defendant/Applicant as a party in this suit, being the agent of a disclosed principal.

c. An Order granting leave to the parties to amend their Court processes accordingly.

d. And for further order or orders as this Honourable Court may deem fit to make in the circumstances.

The 1st Respondent also filed further and better affidavit in response to the Counter-Affidavit.

On June 17, 2019, the trial Court delivered its ruling, in which the Court refused to join Adamu Yusuf Gulma and Zambezie Trust Ltd. as co-defendants to the suit but went further to strike out the name of the 1st respondent from the suit. See pages 144–164 of the Record of Appeal.

Being dissatisfied by the decision to remove the 1st Respondent as a defendant in the suit and also refusing to join 3rd and 4th Respondents, the appellant filed this appeal.

ISSUE(S) FOR DETERMINATION:

The Court considered:

“Whether the trial Judge was right in law, when it struck out the name of the 1st Respondent as a party to suit on the ground that he is an agent of the 2nd Respondent?”

DECISION/HELD:

Having resolved the sole issue in favour of the Appellant, the Court allowed the appeal.

RATIOS:

• ACTION – PARTY(IES) TO AN ACTION – Meaning and classification of parties to an action; importance of competence of parties to the jurisdiction of Court
• ACTION – JOINDER OF PARTY(IES) – Principles governing the issue of joinder of parties
• ACTION – JOINDER OF PARTY(IES) – Purpose of joinder of parties
• ACTION – NECESSARY PARTY(IES) – Who is a necessary party
• ACTION – CAUSE(S) OF ACTION – How the Court determines cause of action
• COMMERCIAL LAW – LIABILITY OF AN AGENT – When an agent will be liable for the act of the principal
• COMMERCIAL LAW – AGENCY – Ways in which principal and agent relationship may arise/can be created
• PRACTICE AND PROCEDURE – AMENDMENT OF COURT PROCESSES/PLEADINGS – Whether there is need to amend the processes before the Court where an order for joinder has been granted
• TORT – LIABILITY IN TORT – Principles of the liability of an agent in tort
• COMMERCIAL LAW – AGENCY – Whether an agent acting on behalf of a known and disclosed principal can incur liability and the exception thereof

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