CASE TITLE: ONYEMENAM v. IMPERIAL HOMES MORTGAGE BANK LTD (2023) LPELR-60149(CA)
JUDGMENT DATE: 3RD APRIL, 2023
PRACTICE AREA: CONTRACT
LEAD JUDGMENT: MUHAMMAD IBRAHIM SIRAJO, J.C.A.
SUMMARY OF JUDGMENT:
INTRODUCTION:
This appeal examines the position of the law on the sanctity of the terms of a contract.
FACTS:
This appeal challenges the judgment of the High Court of Lagos State, delivered by Hon. Justice S.I. Sonaike (Mrs.) on 29/06/2017.
The facts of the Respondent’s case, as Claimant, are that by a letter of offer, it availed the Appellant, a Forty Million Naira (N40,000,000.00) facility to finance the purchase of a 4-Bedroom Townhouse in Lekki Phase I valued at N60,000,000.00. The facility was secured by a Deed of Legal Mortgage over the financed property created by the Appellant/Defendant in favour of the Respondent/Claimant. Bridgeways DPG Limited, in which the Appellant was the CEO, gave both a corporate guarantee and corporate undertaking by which it accepted liability in the event of the Appellant’s default. The Appellant made an equity contribution of N20,000,000.00. The Appellant and the Guarantor, Bridgeways DPG Limited, failed to pay and/or satisfy the Appellant’s obligations under the facility and the mortgage deed, despite repeated demands by the Respondent.
The Appellant’ case, on the other hand, is that contrary to the Respondent’s claim, the Appellant’s title and Deed of Legal Mortgage over the property was not duly perfected due to the Respondent’s negligence and delay. He contended that at the time he applied to the Respondent for the facility, Respondent conducted a search on the property and came up with a report that the property was not under any encumbrance. That it was on the strength of the Respondent’s representation that he invested N20,000.000 (Twenty Million Naira) as counterpart funding to purchase the property and fulfilled all the conditions precedent to the drawdown of the facility as stated in the facility contract, by making all the required upfront payments to the Respondent. It was the further case of the Appellant that consequent upon the failure to perfect his title to the property and the legal mortgage, due to the negligence of the Respondent and its Agents, the Respondent has no legal title to pass to the Appellant when he concludes the repayment of the facility because of the encumbrance on the property, thereby defeating the whole essence of the transaction.
The Court dismissed the Respondent’s claim for N5,000,000.00 cost, as well as the entire Counter Claim of the Appellant.
Dissatisfied, the Appellant appealed. The Respondent also cross-appealed against the decision of the trial Court for its failure to pronounce on the Counter Claim of the Cross-Appellant with respect to the liability or otherwise of the 2nd Cross-Respondent, Bridgeways DPG Limited.
ISSUES:
The Court determined the appeal on the following issues:
1. Whether the trial Court misdirected itself when it found that the parties perfected Title to the Property and the Legal Mortgage and thereby fulfilled their obligations under the Contract.
2. Whether the trial Court misdirected itself when it held that the Claimant/Respondent is entitled to the sum of N18,099,413.66 being the sum amounting to the difference on the Claimant/Respondent’s Claim of N47,451,661.97 on the premise that the Defendant/Appellant failed to prove his contention that a total sum of N8,714,911.26 was overcharged on the Defendant/Appellant’s overdraft and loan accounts.
3. Whether the trial Court erred in law when it found that the Claimant/Respondent was not negligent in the handling of the transaction, the subject matter of this Appeal.
4. Whether the trial Court erred in law when it held that the Defendant/Appellant did not prove his counterclaim by credible evidence.
DECISION/HELD:
In the final analysis, the appeal was dismissed. The Cross-Appeal also failed and was dismissed.
RATIOS:
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