FBN v. DAVIES

CITATION: (2017) LPELR-43556(CA)

In the Court of AppealIn the Lagos Judicial Division

Holden at Lagos

ON WEDNESDAY, 5TH JULY, 2017Suit No: CA/L/04/2009

Before Their Lordships:

JUMMAI HANNATU SANKEY Justice, Court of AppealONYEKACHI AJA OTISI Justice, Court of AppealJOSEPH EYO EKANEM Justice, Court of Appeal

BetweenFIRST BANK OF NIGERIA PLC - Appellant(s)

AndMRS. ADEOLA DAVIES(Substituted for Alhaji Muniru Aisa Animashaun byOrder of this Honourable Court)

- Respondent(s)

RATIO DECIDENDI1. APPEAL - GROUND(S) OF APPEAL: Whether a ground of appeal can be against an obiter dicta

"An appeal is filed against a ratio and not against obiter, except the obiter is so closely linked with the ratioas to be deemed to have radically influenced the ratio. But even there, the appeal is against the ratio;Xtoudos Services Nigeria Ltd v. Taisei (WA) Ltd (2006) LPELR-3504(SC), (2006) 15 NWLR (Pt. 1003) 533."Per OTISI, J.C.A. (Pp. 14-15, Paras. E-A) - read in context

2. APPEAL - GROUND(S) OF APPEAL: Whether a ground of appeal and its particulars should be read andconstrued together"It is trite that grounds of appeal and their particulars are read as a whole in order to determine thecomplaint of the appellant; Orakosim v. Menkiti (2001) 5 S.C. (Pt. 1) 72; P.D.P. v. Lawal (2012)LPELR-7972(CA)."Per OTISI, J.C.A. (P. 15, Paras. E-F) - read in context

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3. CASE LAW - RATIO DECIDENDI/OBITER DICTUM: Meaning and distinction between ratio decidendi andobiter dictum"Obiter dictum is a statement made in passing by the trial Judge or by the way. It arises when a judgeexpresses an opinion on some points that are not in issue or necessary to the case before him. Obiterdictum is not conclusive authority and have no binding effect or weight on the case. As long as nomiscarriage of justice is occasioned thereby, it does not affect the judgment; Bamgboye v. University ofIlorin (1999) 6 SC (Pt. 11) 72, (1999) LPELR-737(SC); Buhari v. Obasanjo (2003) 11 S.C. 74, (2003)LPELR-813(SC). On the other hand, the legal principle formulated by the Court that is necessary in thedetermination of the issues raised in the case, that is the reasoning or ground upon which a case is decided,the binding part of the decision, is its ratio decidendi; Afro-Continental Nigeria Ltd v. Ayantuyi (1995)LPELR-218(SC); Odunukwe v. Ofomata (2010) 18 NWLR (Pt. 1225) 404."Per OTISI, J.C.A. (Pp. 13-14, Paras. F-E) - read in context

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4. CONTRACT - UNDUE INFLUENCE: The doctrine of undue influence and its application"A person who has been induced to enter into a transaction such as a contract or guarantee, by the undueinfluence of another is entitled to set that transaction aside as against the wrongdoer. The effect of undueinfluence, like duress, is to make the contract voidable. A party cannot be held bound to an agreementwhere there has been fraud, duress, undue influence or misrepresentation; Alade v. Alic (Nig.) Ltd (2010) 19NWLR (Pt. 1226) 111, (2010) LPELR-399(SC); Pan Bisbilder Nigeria Ltd v. First Bank of Nigeria Ltd (2000) 1NWLR (Pt. 642) 684 (2000) LPELR-2900. However, the Respondent was required to prove his assertion;Famfa Oil Ltd v. A-G of the Federation (supra); Hillary Farms Ltd v. M.V. Mahtra (supra); Ohochukwu v. A-Gof Rivers State (supra). The Supreme Court in Bua v. Dauda (2003) 13 NWLR (Pt. 838) 657, (2003)LPELR-810(SC), defined undue influence thus:"Undue influence is no doubt elusive of satisfactory definition but it may be regarded as a state of mind of aperson who has been subdued to any improper persuasion or machination in such a way that he isoverpowered and consequently induced to do or forbear an act which he would otherwise do or not do of hisown free will. It is a product of the abuse or misuse of the confidence reposed in someone who is able to putsome pressure on or take unfair advantage of another's necessities or distress: see Black's Law Dictionary,6th Edn. page 1528." Black's Law Dictionary 9th Edition at page 1666 defined 'undue influence' in thismanner:The improper use of power or trust in a way that deprives a person of free will and substitutes another'sobjective. Undue influence can be direct or covert. When there is direct actual undue influence, theclaimant would have to prove affirmatively that the wrongdoer exerted undue influence on him to enter intothe particular transaction which is impugned. Undue influence was described by Lindley LJ in Allcard v.Skinner (1887) 36 Ch D 145, as"... some unfair and improper conduct, some coercion from outside, some overreaching, some form ofcheating and generally, though not always, some personal advantage gained." Where undue influence iscovert or presumed, the claimant has to show that there was a relationship of trust and confidence betweenthe complainant and the wrongdoer of such a nature that it is fair to presume that the wrongdoer abusedthat relationship in procuring the complainant to enter the impugned transaction. If the complainant provesthe existence of such relationship under which the complainant generally reposed trust and confidence inthe wrongdoer, the existence of such relationship raises the presumption of undue influence. The relation ofbanker and customer will not normally give rise to a presumption of undue influence, but it can do so inexceptional cases if the customer has placed himself entirelyin the hands of the bank and has not been given any opportunity to seek independent advice. The issue ofundue influence has received more serious attention globally especially as concerns elderly persons ordependent adults. The Final Report on Undue Influence: Definitions and Applications, presented in March2010 to The Borchard Foundation Center on Law and Aging, being a project supported by the Center, madethe following findings, inter alia:'Despite wide variations in the contexts and circumstances in which undue influence and coercivepersuasion in general have been explored, the findings are remarkably similar in terms of the salientfeatures. Psychologists, sociologists, criminologists, victimologists, legal experts, and Courts have focusedon the following:1. Victim characteristics contributing to vulnerability include incapacity resulting from dementia, mentalillness, or impairment; deficits in judgment or insight; altered states of mind (which may be induced),resulting from medications, sleep deprivation, etc.; emotional distress (which may also be induced). Someanalysts and practitioners have noted that people with "dependentpersonalities" are at heightened risk...2. Influencers' power. Experts agree that to constitute undue influence influencers must be in positions ofpower or authority toward those they influence. They may be in positions of trust or confidence, which canbe formal (e.g., the powerful person has a legal duty toward the less powerful person, as in the case offiduciaries) or informal (as in the case of family members or neighbors)...3. Improper actions or tactics. Influencers take affirmative steps or actions to persuade victims to engage inbehaviors that are contrary to their interests in ways that exceed what is considered to be "normal"persuasion...4. Unfair, improper, "unnatural," or unethical transactions or outcomes. Legal experts generally agree thatto constitute undue influence, harm must result such as the loss of assets or property or inadequate care.Legal experts have focused on transactions that are considered unfair or improper by objective measures orwhat is considered "reasonable," such as the sale of victims' property below market value, or gifts made byvictims that are not commensurate with the length and quality of their relationships with recipients. Otherexamples that are suggestive of undue influence are when those executing documents cannot explainthem..."Per OTISI, J.C.A. (Pp. 33-38, Paras. C-A) - read in context

5. EVIDENCE - BURDEN OF PROOF/ONUS OF PROOF: Whether he who asserts must prove"The compass of the burden of proof remains the evidential principle that he who asserts must prove;Famfa Oil Ltd v. A-G of the Federation (2003) 9-10 SC 31, (2003) LPELR-1239(SC); Hillary Farms Ltd v. M.V.Mahtra (2007) 6 S.C. (Pt. 11) 85, (2007) LPELR-1365(SC); Ohochukwu v. A-G of Rivers State (2012)LPELR-7849(SC)."Per OTISI, J.C.A. (P. 26, Paras. B-D) - read in context

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6. EVIDENCE - PROOF: How undue influence can be proved or established"The Appellant denied these very weighty allegations and put the Respondent to strict proof of any suchvisit from their official. And indeed, the burden to prove undue influence lay on the Respondent; see PanBisbilder Nigeria Ltd v. First Bank of Nigeria Ltd (2000) 1 NWLR (Pt. 642) 684, (2000) LPELR-2900, where theSupreme Court, per Achike, JSC said "Reliance on... undue influence must be established by positiveevidence or strong inference that can be drawn from the surrounding circumstances."Per OTISI, J.C.A. (P.41, Paras. B-D) - read in context

7. EVIDENCE - SPECULATION: Whether Courts are allowed to speculate"... No Court of justice engages in speculation to arrive at objective deductions and conclusions; Agip(Nigeria) Ltd v. Agip Petroleum International (2010) LPELR-250(SC); African Continental Bank Plc v.Emostrade Ltd (2002) 4 S.C. (Pt. 11) 1, (2002) LPELR-207(SC)."Per OTISI, J.C.A. (Pp. 43-44, Paras. E-A) - readin context

8. EVIDENCE - SPECULATION: Whether Courts are allowed to speculate"DW1, the Marketing Manager of the Appellant testified under cross examination that Exhibit CW11 was theonly record the Appellant had on the deposit of the title documents and that there was no interest rateindicated on the said document. Exhibit CW11 was discredited by the lower Court and there was no appealagainst that finding of the Court. As the evidence stood, although there was a total sum of N13 millionadvanced to the Respondent's son, no agreed rate of interest between the parties to govern the transactionwas in evidence. There was also no evidence of the Central Bank of Nigeria prescribed rate of interest toguide bank loan facilities of that nature. In other words, the exact rate of interest used in calculation ofinterest was not in evidence, and, the Court cannot speculate on that fact; Agip (Nigeria) Ltd v. AgipPetroleum International (supra); African Continental Bank Plc v. Emostrade Ltd."Per OTISI, J.C.A. (P. 51,Paras. B-F) - read in context

9. EVIDENCE - SPECULATION: Whether Courts are allowed to speculate"... In other words, both the Appellant and the Respondent, as demonstrated by the evidence of DW1 andby Exhibit C5, the letter written by the Respondent, acknowledged an outstanding on the loan facility of N12million before the suit leading to the instant appeal was instituted. This is the figure accepted by bothparties from the evidence. The basis for any further additional interest was not in evidence and again, thisCourt cannot speculate on that fact; Agip (Nigeria) Ltd v. Agip Petroleum International (supra); AfricanContinental Bank Plc v. Emostrade Ltd."Per OTISI, J.C.A. (Pp. 52-53, Paras. D-A) - read in context

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10. JUDGMENT AND ORDER - AWARD OF INTEREST: Requirements of the law as regards award of pre-judgment interest"The Appellant's entitlement to interest, whether for the loan facility granted or pre-dating any judgmentgiven in the event of a default, must be strictly proved by evidence. This is a well-established principle oflaw. In Diamond Bank Ltd v. Partnership Investment Co. Ltd (2009) 18 NWLR (Pt. 1172) 67, (2009)LPELR-939(SC), the Supreme Court, per Ogbuagu, JSC said:"... the general rule at Common Law, is that interest is not payable on a debt or loan in the absence ofexpress agreement or some course of dealing or custom to that effect. See London Chattam and DoverRailway v. SouthEastern (1893) A.C. 249. Thus, interest will however, be payable where there is an express agreement tothat effect and such agreement may be inferred from a course of dealing between the parties. See Re-Duncan and Co. (1905) 1 Ch. 307 or where an obligation to pay interest arises from the common or usage ofa particular trade or business and I add like in banking."A.G. Ferrero & Company Ltd v. Henkel Chemicals Nigeria Ltd (2011) LPELR-12(SC); Edosa v. First Bank ofNigeria Plc (2011) LPELR-8785(CA); Olam (Nigeria) Ltd v. Intercontinental Bank Ltd (2009) LPELR-8275(CA);International Trust Bank Plc v. Kautal Hairu Co. Ltd (2005) 3 NWLR (Pt. 968) 443; In-Time Connection Ltd v.Ichie (2009) LPELR-8772(CA). In Midas Bank Plc v. Commerce Progetti (Nigeria) Ltd (2009) LPELR-8263(CA)this Court, per Garba, JCA restated the general legal principles on the claims and award of pre-judgmentinterests in civil matters as follows:"The law is that prejudgment interest on a debt or loan can only be awarded where there is sufficientevidence of an agreement between the parties that such interest would be paid. The agreement shouldcontain details such as(a) Rate of interest(b) Date of commencement(c) Date due; whether weekly, monthly, yearly or other specified period.However even where such an agreement was not entered into expressly by the parties, its existence wouldbe readily implied where the plaintiff or judgment creditor is a bank or lending institution because of thecustom in that trade or under the principle of equity, EKPEYONG v. NYONG (1975) SC 71, BARCLAYS BANK v.ABUBAKAR (1977) 10 SC 13, HIMMA MARCHANTS v. ALIYU (1994) 5 NWLR (Pt. 347) 667, VEE PEE IND. LTDv. COCOA IND. LTD (2008) 13 NWLR (1105) 486 @ 513. In line with these authorities therefore, pre-judgment interest can only be awarded in the following circumstances to be established by evidence: -(a) Express agreement of the parties or(b) Existence of mercantile or trade custom, or(c) Under a principle of equity such as a breach of fiduciary relationship.In particular, where there is sufficient and credible evidence of an agreement of the parties, containing allthe essential details of the interest payable on the debt or loan, a Court would have no option than to giveeffect to such agreement. This is based on the principles that parties are bound by the terms and conditionsof an agreement freely entered between themselves and the duty of the Court to give effect to thatagreement."Per OTISI, J.C.A. (Pp. 48-51, Paras. D-A) - read in context

11. JUDGMENT AND ORDER - AWARD OF INTEREST: Position of the law as regards award of post judgmentinterest"The Appellant also sought post-judgment interest of 6% on the judgment sum. Post judgment interestcannot be more than the rate provided in the Rules of Court; Unity Bank Plc v. Nwadike (2008)LPFLR-5067(CA). By the High Court of Lagos State (Civil Procedure) Rules, post-judgment interest shall notexceed 10% per annum. The Appellant has however asked for 6% post-judgment interest and they areentitled to this claim."Per OTISI, J.C.A. (P. 53, Paras. B-C) - read in context

12. JUDGMENT AND ORDER - AWARD OF INTEREST: Requirements of the law as regards award of pre-judgment interest"The issue of interest pre-dating judgment was laboriously considered in resolving the counterclaim of the Appellant/Cross Respondent. The point was well made that interest sought by a claimant, pre-dating judgment must be strictly proved by evidence; Diamond Bank Ltd v. Partnership Investment Co. Ltd(supra); Midas Bank Plc v. Commerce Progetti (Nigeria) Ltd."Per OTISI, J.C.A. (Pp. 54-55, Paras. F-A) - read incontext

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13. MORTGAGE - EQUITABLE MORTGAGE: Nature of an equitable mortgage"An equitable mortgage is one which is lacking one or more formalities of legal requirements, such asstamping, filing or registration. Equitable mortgages are recognized under common law to protect the rightsand obligations under a mortgage that is not completed in law. However, an equitable mortgage will besubordinate to the priority given to a legal mortgage. Ways in which an equitable mortgage could becreated were listed in Ogundiani v. Araba (1978) 6-7 S.C. 42, (1978) LPELR-2330(SC), as follows:1. by mere deposit of title deeds with a clear intention that the deeds should be taken or retained assecurity for the loan;2. by an agreement to create a legal mortgage and3. by mere equitable charge of the mortgagor's property.See also: Yaro v. Arewa Construction Ltd (supra); B.O.N. v. Akintoye (1999) 12 NWLR (Pt. 631) 392; FirstBank of Nigeria Plc v. Songonuga (2005) LPELR-7495(CA); Hydro-Tech Nigeria Ltd v. Leadway Assurance Co.Ltd (2016) LPELR-40146(CA). On the nature of equitable mortgages in First Bank of Nigeria Plc v.Songonuga (supra), Ogunbiyi, JCA (as he then was) expounded:"Deducing from the conduct of parties, even in the absence of a formal consent obtained from the governorit is sufficient that the intention to appropriate the property to the discharge of a debt was clearlymanifested and thus creating a sufficient pre-requisite of an equitable charge. Without any need of amathematical calculation, it is an established principle of law, well grounded, that "equity looks on that asdone which ought to be done."In other words, "equity looks to the intent rather than to the form." The authors of Snells' Principles ofEquity, 27th Edition at p. 39 held the view that the said maxim lies at the root of equitable doctrinesgoverning mortgages. Furthermore, it has also been firmly established that even the history of creation ofequitable mortgage itself bears out the willingness of the Court to enforce intentions even if appropriateformalities for legal validity have not been met. The authority underlining the said laid down principle is theLaw of Real Property, 3rd Edition by Megarry and Wade p. 895... It is evident that by the very act of therespondent depositing the title deeds with the execution of a memorandum of deposit, same had indicatedonly one clear intention and purpose which was the creation of an equitable mortgage."In all theseauthorities, one thing stands clear: there must be a clear intention that the title deeds deposited should betaken or retained as security for the loan. One way in which such intention can be made manifest is by theexecution of a memorandum of deposit; Yaro v. Arewa Construction Ltd. (supra); B.O.N. v Akintoye (1999)12 NWLR (Pt. 631) 392; First Bank of Nigeria Plc v. Songonuga (supra). A memorandum of deposit is adocument which acknowledges the deposit of the title deeds for the purpose of an equitable mortgage andstates the terms of the transaction, including interest rates applicable. An offer letter for the facility whichstates the terms of the transaction, incorporating the deposit of the title documents as part of its terms andwhich the party endorses by execution can also be viewed as a memorandum of deposit; StandardManufacturing Company Ltd v. Sterling Bank Plc (2015) LPELR-24741(CA). The crucial point is that it mustbe made unambiguously manifest that there was a clear intention that the title deeds should be taken orretained as security for the loan."Per OTISI, J.C.A. (Pp. 23-26, Paras. A-A) - read in context

14. MORTGAGE - EQUITABLE MORTGAGE: Way(s) of creating an equitable mortgage"Only oral assent is required for creation of an equitable mortgage. In Usenfowokan v. Idowu (1975) 4 S.C.(REPRINT) 136, the Supreme Court, per Sowemimi, JSC said:"It is a well established rule of equity that a deposit of a document of title without either writing or word ofmouth will create in equity a charge upon the property to which the document relates to the extent of theinterest of the person who makes the deposit."An equitable mortgage may thus be created without word of mouth but with mutual understanding and aclear intention that the purpose for the deposit of the title deeds was for a mortgage. See also: Ogundiani v.Araba."Per OTISI, J.C.A. (P. 32, Paras. B-E) - read in context

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ONYEKACHI AJA OTISI, J.C.A. (Delivering the Leading

Judgment): This is an appeal against the decision of the

High Court of Lagos State in Suit No: LD/2364/2005

presided over by Adebiyi, J., delivered on April 28th 2008 in

which the lower Court entered judgment in favour of the

Respondent against the Appellant.

The Respondent, as claimant had initiated the action

leading to this appeal against the Appellant as 1st

defendant and one other. In brief, the facts leading to the

appeal are as follows: Sometimes in 2002, the Respondent's

son, one Dr. Fatai Animashaun approached the Appellant

for a loan facility in the sum of N10 million on account of

which the Respondent deposited the title deeds to his

landed property at Aisa Animashaun Crescent with the

Appellant. The Respondent's son subsequently took a

further loan of N3 million from the Appellant. He defaulted

in his repayment obligations such that by 2005, the

principal sum together with interest had risen to

N47,241,099.42. Upon demand for the liquidation of the

debt by the Appellant, the Respondent responded by

offering to pay to the Appellant only the sum of 18 million,

which he did.

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Upon the Appellant's insistence on the liquidation of the

residue of N29,241,098.00, the Respondent for the first

time contended that he had in handing over the title

documents of his property as security for the loan facility

granted to his son, acted under the undue influence of the

Appellant's officials. He then sought to recover from the

Appellant, both his title documents and the N18 million

that he had previously paid to the Appellant. The Appellant

denied the Respondent's claims and assertions. The

Respondent then took action by Writ of Summons and

Statement of Claim against the Appellant as 1st defendant

and one other as 2nd defendant, seeking the following

reliefs, pages 1-9 of the Record of Appeal:

1. A DECLARATION that the 1st defendant is not entitled to

continue keeping in its custody the originals of the title

documents of the claimant to his landed properties at Aisa

Animashaun Crescent, Ilupeju, Lagos State, which

documents are the Indenture of September, 1968

registered as No. 13 at Page 13 in Volume 1274 of the Land

Registry, Lagos and the Indenture of 14th June 1976

registered as No.7 at Page 7 in Volume 1565 of the Land

Registry, Lagos

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without affording the claimant of the details of the

transaction which led to his title documents being

deposited with it and copies of all relevant documents

thereof.

2. A DECLARATION that the purported surety or guarantee

of the 1st defendant's loan to Dr. Fatai O. Animashaun and

purported mortgage of the claimant's landed properties at

Aisa Animashaun Crescent, Ilupeju, Lagos State covered by

documents being the indenture of September, 1968

registered as No. 13 at Page 13 in Volume 1274 of the Land

Registry, Lagos and in the Indenture of 14th June 1976

registered as No. 7 at Page 7 in Volume 1565 of the Land

Registry, or the deposit of the title deeds thereof to the 1st

defendant were due to the 1st defendant's inducement

and/or undue influence of the claimant and that the said

transaction (s) are null and void and of no effect

whatsoever.

3. Alternatively, A DECLARATION that the 1st defendant

holds and have held the said land title documents of the

claimant as trustee for and on behalf of the claimant.

4. AN INJUNCTION restraining the defendants, whether by

themselves, their servants, privies and/or agents or

howsoever otherwise, from selling (whether by auction or

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otherwise), leasing or alienating in any form or, in any

manner howsoever, disturbing the possession of the

claimant of the properties situate at Aisa Animashaun

Crescent, Ilupeju, Lagos State which are contained in the

documents entitled the Indenture of September, 1968

registered as No. 13 at Page 13 in Volume 1274 of the Land

Registry, Lagos and the Indenture of 14th June 1976

Volume 1274 of the Land Registry, Lagos or in any manner,

howsoever, taking any step towards foreclosing or doing

anything in respect of the said properties pursuant to the

said alleged mortgage/transaction.

5. A MANDATORY INJUNCTION commanding the 1st

defendant to pay back to the claimant the sum of

N18,000,000.00 (Eighteen million Naira) already paid by

the claimant to the 1st defendant upon the alleged

transaction with interest at 21% per annum from 9/11/2005

until payment.

6. A MANDATORY INJUNCTION commanding the 1st

defendant to return to the claimant his title documents

being the Indenture of September, 1968 registered as No.

13 at Page 13 in Volume 1274 of the Land Registry, Lagos

and the Indenture of 14th June 1976 registered as no. 7 at

Page 7

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in Volume 1565 of the Land Registry, Lagos.

The Appellant in response, filed a Statement of Defence

and Counterclaim, pages 96-99 of the Record of Appeal, by

which it counterclaimed against the Respondent as follows:

i) The sum of N29,241,098 (Twenty-Nine million, Two

hundred and Forty One Thousand, Ninety-Eight Naira only)

with interest at the rate 28% per annum from the date of

this Counter-claim to judgment and thereafter at 6% till the

final liquidation.

ii) Cost of this action.

The Respondent filed a Reply and Statement of Defence to

Counterclaim, pages 56-57 of the Record of Appeal. At the

conclusion of hearing, the learned trial Judge upheld the

Respondent's claims but dismissed the Appellant's Counter-

claim, pages 169-182 of the Record of Appeal. The

Appellant, being dissatisfied with the said judgment, lodged

this appeal by Notice of Appeal filed on 8/5/2008 upon five

grounds of appeal, pages 183-186 of the Record of Appeal.

The Respondent also cross appealed by Notice of Cross-

Appeal filed on 6/9/2013 and deemed properly filed and

served on 3/3/2014 on four grounds of appeal.

The parties exchanged Briefs of Argument. The Appellant's

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Brief was filed on 25/3/2014 but deemed properly filed and

served on 2/11/2015. The Respondent/Cross Appellant's

Brief, in which a Preliminary Objection was argued, was

filed on 21/11/2016. The Appellant's Reply Brief to

Respondent/Cross-Appellant's Preliminary Objection and

Cross Appeal was filed on 17/3/2017 and deemed on

8/5/2017. These processes were respectively adopted on

8/5/2017 by Chief A. Adeniji, with E. F. Ogunbanowo (Mrs.)

and Ugochi Ekeugo (Miss.) for the Appellant; and by B. A.

M. Fashanu, SAN with O. A. Ilori-Adeogu (Mrs.) for the

Respondent.

By the Preliminary Objection, the Respondent/Cross

Appellant contended that there were fatal defects inherent

in the Appellant's Notice of Appeal and Brief of Argument

as follows:

1. Incompetent ground of Appeal.

It was argued that ground II of the Appellant's Notice of

Appeal is incompetent in that the said ground: "the learned

judge erred in law when she held that the Appellant unduly

influenced the claimant", does not attack the ratio

decidendi of the judgment of the lower Court. It was

submitted that the learned Judge did not make such a

holding. Rather, the observation on undue influence was a

comment by the

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learned trial Judge and as such the ground was distilled

from an obiter dictum of the judgment, page 179 of the

Record of Appeal. Learned Senior Counsel submitted that a

ground directed at a mere obiter dictum cannot form the

basis of an appeal; relying on Idise v. Williams Int'l. Ltd.

(1995) 1 NWLR (Pt. 370) 142 at 150; C.C.B. Ltd. v.

Nwokocha (1998) 9 NWLR (Pt. 564) 98 at 123;

Pharma. Deko Plc v. N.S.I.T.M.B. (2011) 5 NWLR (Pt.

1241) 431 at 445; Ogbe v. Asade (2009) 18 NWLR (Pt.

1172) 106 at 126. A ground of appeal distilled from an

obiter dictum of a judgment is incompetent and liable to be

struck out; relying on Ogunbiyi v. Ishola (1996) 6 NWLR

(Pt. 452) 12; X.S. (Nig.) Ltd. v. Taisei (W.A) Ltd.

(2006) 15 NWLR (Pt. 1003) 533. The Court was urged to

strike out ground II of the Notice of Appeal.

2. Incompetent Issue

It was submitted that Issue 2 of the Appellant's Brief which

was distilled from ground II of the Notice of Appeal is

incompetent. Issue 2 was formulated from ground II and

other grounds. Since the Court cannot perform surgical

operation to sift argument from the incompetent and

competent grounds of appeal, Issue 2 cannot stand; relying

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on Sehindemi v. Governor, Lagos State (2006) 10

NWLR (Pt. 987) 1. The Court was urged to strike out

Issue 2 of the Appellant's Brief.

3. Issues Not Arising from Grounds of Appeal

The Appellant's Issue 1 for determination as to whether the

deposit by the Respondent of his title documents with the

Appellant with the expressed intention that same should be

used as security for the loan, did not create an equitable

mortgage between the parties and did not arise from any of

the grounds of appeal as none of the grounds of appeal has

anything to do with an equitable mortgage. That issues for

determination must be distilled from the grounds of appeal.

Any issue which does not arise from the grounds of appeal

is incompetent and is liable to be discountenanced or

struck out. The Court was urged to strike out Issue 1 as

formulated by the Appellant. The decisions in W.A.E.C v.

Adeyanju (2008) 9 NWLR (Pt. 1092) 270; C.R.S.N.C. v.

Oni (1995) 1 NWLR (Pt. 371) 270; Oniah v. Onyia

(1989) 1 NWLR (Pt. 99) 514 were cited and relied on.

4. Raising fresh Issue for the first time on Appeal

An appeal is a continuation of the action and that no new

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issues can be raised on appeal without leave; relying on

Oredoyin v. Arowolo (1989) 4 NWLR (Pt. 114) 172 at

211. It was submitted that no evidence as to the existence

of an equitable mortgage between the parties was led at

the trial Court. The issue of equitable mortgage was a fresh

issue being raised for the first time in this Court. All that

the Appellant contended at the lower Court by its

statement of defence and counter-claim was a contract of

guarantee. The case of Adegoke Motors Ltd. v. Adesanya

(1989) 3 NWLR (Pt. 109) 250 at 266 was relied on to

submit that a party will not be allowed to introduce an

issue in the appellate Court which was not raised and

pursued in the lower Court thereby setting up an entirely

new case in his appeal before this Court. An Appellant will

not be allowed to raise on appeal a point or issues that was

not raised, canvassed or argued at the trial Court without

the leave of the Appeal Court, relying on Elugbe v.

Omokhafe (2004) 18 NWLR (Pt. 905) 319. The Court

was urged to strike out Issue 1 as formulated by the

Appellant as well as all argument in support thereof. That

since no issue relating to equitable mortgage was raised at

the trial Court, the cases

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of Kadiri v. Olusoga (1956) SCNLR 150 at 153 and

Yaro v. Arewa Construction Ltd. (2008) All FWLR (Pt.

400) 603 at 634 which relates to strict mortgage

transactions dealing with the deposit of title deeds as

security for loan and which the Appellant has placed heavy

reliance on, do not apply to the present case. It was finally

submitted that with Issues 1 and 2 as formulated by the

Appellant being struck out, the Appellant's Brief would be

left with no issues or argument. The Court was urged to

strike out the said Appellant's Brief and to dismiss the

appeal.

In reply, the Appellant submitted that the lower Court had

made findings arising from the statement alleged to be

obiter at page 180 of Record of Appeal as follows:

"In the instant case, the Claimant maintained in his

testimony that he was subjected to undue influence by the

1st Defendant. Whilst the acts of the 1st Defendant's

officials in this case might not be interpreted to be positive

acts of oppression their act of persuading the Claimant to

assist his son, knowing that he the Claimant reposed

confidence in their judgment bearing in mind his age and

physical

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impairment could be described to be unconscionable

behavior. This observation does not in any way affect my

findings that the purported surety or guarantee of the 1st

Defendant's loan to Dr. Fatai Animashaun and purported

mortgage of the Claimant's landed properly at Aisa

Animashaun Crescent Ilupeju were null and void of no

effect, due to the 1st Defendant undue influence and

the failure of the 1st Defendant to enter into a

contract of guarantee with the Claimant."

Emphasis supplied.

It was submitted that the above decision of the lower Court

was a finding of fact because issue was joined by both

parties in their pleadings on whether or not the Respondent

was unduly influenced by the Appellant, paragraphs 8, 9,

10, 11, 13, 14 and 15 of the Respondent's Statement of

Claim at pages 4-9 of Record of Appeal; and paragraph 5

(a) to (o) of the Statement of Defence and Counter Claim at

pages 96-100 of the Record of Appeal. The determination of

the lower Court thereon was what ground 11 was

challenging. On what is a finding of fact, the decision of

this Court in J. A. Ilori & Ors. v Musibau Tella & Anor.

(2006) 18 NWLR (Pt. 1011) 267 was cited and relied

on.

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It was submitted that ground 11 of the Notice of Appeal

was not incompetent, that Issue 2 distilled therefrom was

not incompetent and that this ground of objection ought to

fail.

On the objection to Issue 1, it was submitted that Grounds

1, 2 and 4 of the grounds of appeal all have to do with the

issue of an equitable mortgage. The decision of the lower

Court was that no contract of guarantee existed between

the Appellant and the Respondent and that no valid

equitable mortgage has been created by the Respondent. It

was never in dispute that the Respondent deposited his title

documents with the Appellant as security for the loan

granted to his son. The trial judge failed to give any

consideration to this fact. Once the Respondent admitted

that he voluntarily deposited his title documents with

Appellant with the intention that it will be used as security

for the loan, it is settled law that such deposit of title with

intent operates to remove the transaction from the ambit of

the Statute of Frauds; and the trial Court's inability to

make this finding makes its decision, inter alia, perverse.

On whether a fresh issue was raised on appeal, it was

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submitted that the trial Court itself considered whether the

issue of equitable mortgage was created between the

Appellant and Respondent and reached a decision on it;

referring to pages 176 to 181 of the Record of Appeal. It

cannot in this circumstance be regarded as a fresh issue

being raised for the first time in this Court. The Court was

urged to dismiss this ground of objection. It was further

submitted that the Respondent was not misled by the

Grounds of Appeal and Issues formulated thereon for

determination, which the preliminary Objection has

attacked. That the law is settled that once the parties are

not misled by the contents of a ground of appeal,

complaints about form become a mere technicality as

miscarriage of justice is not occasioned. The case of

Obiodu v. Duke (2006) 1 NWLR (Pt. 961) 375 was cited

and relied on. It was also submitted, relying on Effiong v.

Ironbar (1998) 12 NWLR (Pt. 582) 367 that the

objections raised by the Respondent were not of a nature

that would prevent this appeal from being heard. The Court

was urged to dismiss the said preliminary objections.

Obiter dictum is a statement made in passing by the trial

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Judge or by the way. It arises when a judge expresses an

opinion on some points that are not in issue or necessary to

the case before him. Obiter dictum is not conclusive

authority and have no binding effect or weight on the case.

As long as no miscarriage of justice is occasioned thereby,

it does not affect the judgment; Bamgboye v. University

o f I lor in (1999) 6 SC (Pt . 11) 72 , (1999)

LPELR-737(SC); Buhari v. Obasanjo (2003) 11 S.C. 74,

(2003) LPELR-813(SC). On the other hand, the legal

principle formulated by the Court that is necessary in the

determination of the issues raised in the case, that is the

reasoning or ground upon which a case is decided, the

binding part of the decision, is its ratio decidendi; Afro-

Continental Nigeria Ltd v. Ayantuyi (1995)

LPELR-218(SC); Odunukwe v. Ofomata (2010) 18

NWLR (Pt. 1225) 404.

An appeal is filed against a ratio and not against obiter,

except the obiter is so closely linked with the ratio as to be

deemed to have radically influenced the ratio. But even

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there, the appeal is against the ratio;Xtoudos Services

N i g e r i a L t d v . T a i s e i ( W A ) L t d ( 2 0 0 6 )

LPELR-3504(SC), (2006) 15 NWLR (Pt. 1003) 533.

The issue of undue influence over the Respondent by

officials of the Appellant was averred in the pleadings and

issues joined thereon, paragraphs 9 and 10 of the

Statement of Claim and paragraph 5 of the Statement of

Defence and Counterclaim at pages 5 and 96-97 of the

Record of Appeal. The Respondent as PW1 also testified to

this effect. The learned trial Judge in conclusion on the

claims of the Respondent, made reference to the issue of

undue influence. The conclusion of the trial Court thereon

cannot be described as merely obiter. Ground 11 of the

grounds of appeal cannot in this circumstance be waved

away as being incompetent. Issue 2 as formulated by the

Appellant thereon is also not incompetent.

The trial Court by the evidence adduced found that there

was no valid equitable mortgage created by the Respondent

and no contract of guarantee, see pages 176-179. It is trite

that grounds of appeal and their particulars are read as a

whole in order to determine the complaint of the appellant;

Orakosim v. Menkiti (2001) 5 S.C. (Pt. 1) 72; P.D.P. v.

Lawal (2012) LPELR-7972(CA). An examination of the

grounds of appeal and particulars will reveal that the

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Appellant attacked the findings and conclusions of the

learned trial Judge. The Appellant in its Brief stated that

Issue 1 was formulated from grounds 1, 3 and 4. Issue 1

was not therefore not a fresh issue but one over which the

lower Court had made a decision. Issue 1 as formulated by

the Appellant, which arose from the grounds of appeal, was

not incompetent. In all, I find the Preliminary Objection

to be without merit. It is accordingly overruled and

hereby dismissed.

Out of the five grounds of appeal, learned Counsel for the

Appellant distilled two issues for determination as follows:

i) Whether the deposit by the Respondent of his title

documents with the Appellant with the expressed intention

that same should be used as security for the loan, did not

create an equitable mortgage between the parties;

ii) Whether there was justifiable basis for the lower Court's

conclusion that the Respondent had been unduly

influenced.

For the Respondent, the issues for determination were

formulated in this way:

1. Whether the decision of the trial Court that the

purported surety or guarantee of the 1st Defendant's loan

to

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Dr. Fatai O. Animashaun is null and void and of no effect

was valid and proper and could be sustained in law.

II. Whether the lower Court's comment on undue influence

constitutes a ratio of that Court's decision.

These issues as formulated are identical, though differently

worded. I adopt the issues as formulated by the Appellant

for determination.

Issue 1

There was no dispute, as also found by the trial Court, that

the Respondent deposited his title documents with the

Appellant as security for the loan granted to his son.

Having reviewed the evidence and arriving at the

conclusion that the signature purported to be that of the

Respondent in document which acknowledged the title

deeds deposited, Form 917, Exhibit CW11 or C11, differed

substantially from his signature on a letter written by the

Respondent, Exhibit C5, the learned trial Judge made the

following findings:

"It is elementary but a fundamental principle of law that a

contract of guarantee which the term implies an

undertaking must be in writing in order to be binding on

the guarantor. If it is not in writing it is not a contract of

guarantee strictu

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sensu...

Based on the Court's earlier holding that no valid equitable

mortgage was created by the Claimant and that there is no

contract of guarantee between the Claimant and 1st

defendant the Court hereby declares that the 1st defendant

is not entitled to continue keeping the title documents in

respect of the Claimant's landed properties at Aisa

Animashaun Crescent, Ilupeju, Lagos..."

Pages 178-179 of the Record of Appeal.

It was submitted that the reasoning of the Court

reproduced above, which formed the basis for the decision

voiding the transaction between the parties were on two

premises;

i) Notwithstanding the Respondent's deposit of his title

deeds with the Appellant, no valid equitable mortgage had

been thereby created, and;

ii) For any contract of guarantee to be binding, it must be

evidenced in writing.

Learned Counsel argued that the reasoning and conclusion

do not reflect an accurate statement of the correct position

of the law and was insupportable. On how an equitable

mortgage is created, Counsel referred the Court to the

learned authors of 'The Law of Real Property' 2nd Edition,

R. E. Megarry, QC and H.W.R.

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Wade at page 855; and 'Cheshire's Modern Law of Real

Property' 12th Edition, by E.H. Burn at page 650. The

decisions of the Supreme Court in Kadiri v. Olusoga

(1956) SCNLR 150 at 153; Yaro v. Arewa Construction

Ltd (2008) All FWLR (Pt. 400) 603 at 634, were also

cited and relied upon. It was submitted that the mere

deposit of title deeds without more was sufficient to create

a valid equitable mortgage which is binding. That the

insistence of the learned trial Judge on the need for a

written document was without foundation in law. Counsel

posited that although the learned trial Judge did not

expressly so state, her insistence on the need for written

evidence was based on the provisions of Section 4 of the

Statute of Fraud, which required that for contracts relating,

inter alia, to guarantee of debts or transfer of interests in

land to be in writing to be enforceable, they ought to be in

writing. It was submitted that in cases of the nature as the

instant case, the need for the transaction being in writing

had been obviated, re ly ing on Yaro v. Arewa

Construction (supra). The Court was urged to hold that

by applicable principles, the absence of a

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written memorandum did not in any way detract from the

efficacy or enforceability of the transaction.

For the Respondent, it was submitted that the crucial

question was whether the nature of the transaction the

parties had was a mortgage or a contract of guarantee. The

lower Court, which saw, heard and assessed the witnesses

and documents tendered through them inferred that the

dispute between the parties revolved around a contract of

guarantee. That what was in contention at the lower Court

was the validity or otherwise of the contract of guarantee

between the Appellant and the Respondent. Where the trial

Court had made a finding of fact to the effect that what

exists between the parties was not a contract of guarantee,

which finding is not perverse, this Court should not

substitute its views for those of the trial Court; relying on

Isaac Gaji & Ors. v. Emmanuel D. Paye (2003) 8

NWLR (Pt. 823) 583 at 601. The pleadings of the

Appellant were referred to in submitting that the Appellant

was aware that of the nature of agreement it had with the

Respondent was that of a contract of guarantee. On the

judicial definition of a guarantee, the decision of this Court

in Trade Bank Plc v. Chami (2003) 13 NWLR (Pt. 836)

210 was cited and relied upon.

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A contract of guarantee is bound to be in writing, distinct

and separate from the principal debtor's contract, relying

on Chami v. UBA Plc (2010) 2 MJSC 119. The nearest to

a written document in proof of a purported guarantee was

Form No. 917, Exhibit C11, which was purported to have

been executed by the Respondent. The Respondent denied

this assertion and put the Appellant to the proof, which the

Appellant failed. The trial Court accepted the testimony of

the Respondent that he did not execute the document. It

was contended that the mere deposit of title deeds without

more was sufficient to create a valid equitable mortgage.

The creation of an equitable mortgage by the deposit of

title deeds involved the execution of a memorandum of

deposit containing the terms of the loan in addition to the

underlining principle that the deposit must be with clear

intention that the deed should be retained as security. With

the clear principle guiding the creation of equitable

mortgage and a contract of guarantee being the bedrock of

this action, the lower Court had no doubt that what the

Appellant sought to enforce

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against the Respondent was a purported mortgage built on

a non-existent contract of guarantee and as such held that

the respondent could avoid the purported mortgage. The

Court was urged to resolve this issue in favour of the

Respondent.

One of the issues formulated by the trial Judge in

determining the matter was:

"Whether the purported contract of guarantee between the

claimant and the 1st defendant involving the purported

mortgage of the claimants(sic) landed properties is valid or

the claimant is entitled to avoid same."

This issue was resolved against the Appellant. The learned

trial Judge held at page 179 of the Record of Appeal:

"Based on the Courts(sic) earlier holding that no valid

equitable Mortgage was created by the claimant and that

there is no contract of Guarantee between the claimant and

the 1st defendant the Court hereby declares that the 1st

defendant is not entitle(sic) to continue keeping the title

documents in respect of the claimant(sic) landed

properties..."

Upon this finding and conclusion, the Appellant contended

that there was an equitable mortgage between the parties

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as there was an expressed intention that said documents

should be used as security for the loan granted to the

Appellant's son.

An equitable mortgage is one which is lacking one or more

formalities of legal requirements, such as stamping, filing

or registration. Equitable mortgages are recognized under

common law to protect the rights and obligations under a

mortgage that is not completed in law. However, an

equitable mortgage will be subordinate to the priority given

to a legal mortgage. Ways in which an equitable mortgage

could be created were listed in Ogundiani v. Araba

(1978) 6-7 S.C. 42, (1978) LPELR-2330(SC), as follows:

1. by mere deposit of title deeds with a clear intention that

the deeds should be taken or retained as security for the

loan;

2. by an agreement to create a legal mortgage and

3. by mere equitable charge of the mortgagor's property.

See also: Yaro v. Arewa Construction Ltd (supra);

B.O.N. v. Akintoye (1999) 12 NWLR (Pt. 631) 392;

First Bank of Nigeria Plc v. Songonuga (2005)

LPELR-7495(CA); Hydro-Tech Nigeria Ltd v. Leadway

Assurance Co. Ltd (2016) LPELR-40146(CA). On the

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nature of equitable mortgages in First Bank of Nigeria

Plc v. Songonuga (supra), Ogunbiyi, JCA (as he then was)

expounded:

"Deducing from the conduct of parties, even in the absence

of a formal consent obtained from the governor it is

sufficient that the intention to appropriate the property to

the discharge of a debt was clearly manifested and thus

creating a sufficient pre-requisite of an equitable charge.

Without any need of a mathematical calculation, it is an

established principle of law, well grounded, that "equity

looks on that as done which ought to be done."

In other words, "equity looks to the intent rather than to

the form." The authors of Snells' Principles of Equity, 27th

Edition at p. 39 held the view that the said maxim lies at

the root of equitable doctrines governing mortgages.

Furthermore, it has also been firmly established that even

the history of creation of equitable mortgage itself bears

out the willingness of the Court to enforce intentions even

if appropriate formalities for legal validity have not been

met. The authority underlining the said laid down principle

is the Law of Real Property, 3rd Edition by Megarry and

Wade p. 895...

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It is evident that by the very act of the respondent

depositing the title deeds with the execution of a

memorandum of deposit, same had indicated only one clear

intention and purpose which was the creation of an

equitable mortgage."

In all these authorities, one thing stands clear: there must

be a clear intention that the title deeds deposited should be

taken or retained as security for the loan. One way in which

such intention can be made manifest is by the execution of

a memorandum of deposit; Yaro v. Arewa Construction

Ltd. (supra); B.O.N. v Akintoye (1999) 12 NWLR (Pt.

631) 392; First Bank of Nigeria Plc v. Songonuga

(supra). A memorandum of deposit is a document which

acknowledges the deposit of the title deeds for the purpose

of an equitable mortgage and states the terms of the

transaction, including interest rates applicable. An offer

letter for the facility which states the terms of the

transaction, incorporating the deposit of the title

documents as part of its terms and which the party

endorses by execution can also be viewed as a

memorandum of deposit; Standard Manufacturing

Company Ltd v . Ster l ing Bank Plc (2015)

LPELR-24741(CA). The crucial point is that it must be

made

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unambiguously manifest that there was a clear intention

that the title deeds should be taken or retained as security

for the loan.

The contention of the Appellant was that the equitable

mortgage was created by the mere deposit of the

Respondent's title deeds with the express intention that the

said title deeds should be taken or retained as security for

the loan. The compass of the burden of proof remains the

evidential principle that he who asserts must prove; Famfa

Oil Ltd v. A-G of the Federation (2003) 9-10 SC 31,

(2003) LPELR-1239(SC); Hillary Farms Ltd v. M.V.

Mahtra (2007) 6 S .C . (Pt . 11) 85 , (2007)

LPELR-1365(SC); Ohochukwu v. A-G of Rivers State

(2012) LPELR-7849(SC). The express intention for the

deposit of the title deeds by the Respondent must therefore

be apparent from the evidence adduced by the Appellant.

The Appellant pleaded that the Respondent executed the

Appellant's Form 917 as evidence of the purpose for the

deposit of title documents, see paragraphs 5(d) of the

Statement of Defence and paragraph 9 of the Counter

claim, pages 98 and 99 of the Record of Appeal. Of note are

Exhibits C5 and C11, also CW11.

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Exhibit C5 was copy of a letter dated October 26, 2005

written by the Respondent. Exhibit CW11 was a copy of the

said Form 917. Regarding the transaction, the Respondent

said under cross examination at page 117 of the Record of

Appeal:

"I trusted them i.e. the 1st Defendant they never gave me

documents to sign."

Under further cross examination, at page 120 of the Record

of Appeal, the Respondent again said:

"I was never given a document to sign for the N10 million

facility taken...

I can sign. Exhibit C5 was maybe signed by me."

PW2 testified thus, page 121 of the Record of Appeal:

"I see Exhibit C5, I see the Claimants(sic) signature

thereon. I see Form 917, attached to the Defendants(sic)

documents the signature thereon is not the Claimants(sic)."

Under cross examination, the Appellant's witness, DW1,

said, page 129 of the Record of Appeal:

"Exhibit CW11, it is the deposed(sic) of title documents,

this is the only record we have... I see exhibit C5 – letter

dated 26th October, 2005, I see the signature, they are not

the same i.e. on Exhibits C5 and C11."

The learned trial Judge on these pieces of evidence, said,

pages 177-178 of the Record of Appeal:

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"In considering the evidence of the claimant the Court shall

examine this purported signature on page 2 of Form 917

(Exhibit CW11) and compare same with his signature in his

letter to the 1st defendant dated 26th October 2005,

Exhibit C...

In the instant case the Court finds in evaluating the

signature of the claimant that his signature in his letter

dated 26th October, 2005 (Exhibit C5) differs substantially

from is purported signature in Form 917 (Exhibit CW11)

the disputed document. Based on this and the testimony of

the 2nd CW the Court accepts the testimony of the claimant

that he did not execute Exhibit CW11."

The learned trial Judge also noted that DW1 had admitted

there was no other document they had other than the

discredited Exhibit CW11. She went on to hold that there

was no contract of guarantee and no valid equitable

mortgage, page 179 of the Record of Appeal.

It is noteworthy that the Respondent accepted that he

signed Exhibit C5 and the trial Court accepted the

authenticity of the signature of the Respondent on Exhibit

C5. Exhibit C5 was a letter written by the Respondent to

the Appellant on

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26/10/2005, reproduced at pages 53-54 and on pages 75-76

of the Record of Appeal. As at 26/10/2005 when the letter

was written, no action had been filed by the Respondent,

between the parties, there was cordiality. In the said letter,

the Respondent wrote, in part:

"Dear Sir,

RE: - INTEREST ON LOAN GRANTED TO DR. F. O.

ANIMASHAUN AT YOUR ILUPEJU BRANCH, LAGOS

I want to thank your letter dated 13th day of October 2005,

which was sent to me...

While thanking you for granting me extension of time to

balance the above-named account of N17,000,000.00k

(Seventeen million Naira) not later than 31st day of

December, 2005.

May I respectfully refer the Bank to the following events. I

respectfully ask the Bank to give me reasonable reduction

in the interest of N17,000.000.00k (Seventeen million

Naira).

I refer the Bank to please note that I Mortgaged my

properties originally for the sum of N10,000,000.00k (Ten

million Naira) which was granted for the action, but

without my knowledge my son, Dr. F.O. Animashaum, got

further transaction for the sum of N3,000,000.00 (Three

Million

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Naira) without any authority from me but for the interest I

have being having(sic) with the Bank I accepted the

N3,000,000.00 (Three million Naira) as part of my

Guarantee by signing further committment(sic) to the

Bank...

So far, I must thank you again for granting me an extension

of time to settle the interest of N17,000,000.00k

(Seventeen Million Naira) for which I respectfully and

naturally ask you to reconsider the interest and let me have

my Security which I pledge(sic) to the Bank.

Meanwhile, I attached(sic) herewith a cheque No.

"03360027" for the sum of N5,000,000.00k (Five million

Naira) for your consideration as final payment of the

Interest on the Mortgaged Loan, and let me know what

date I could send for the collection of the Securities that I

pledge(sic) for the Mortgaged Loan."

I find the contents of this letter very revealing. By its very

terms, the said letter discloses:

1. The parties had a cordial relationship as at October 26,

2005 when the letter was written.

2. The Respondent was well aware that he mortgaged his

properties to secure the loan of N10 million given to his

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son. In other words, he understood the reason why the

deposit of the title deeds was made.

3. He was not notified before the Appellant granted to his

son a further loan of N3 million but when he became

aware, he decided to also stand by the existing mortgage,

having regard to his previous and existing relationship with

the Appellant.

4. The Respondent was aware that he was being charged

interest on the said loan.

5. The balance on the loan was N17 million and due for

payment by December 31, 2005.

6. The Respondent attached a cheque to the letter for a

further payment of N5 million, thereby reducing the

balance to N12 million now to be paid by December 31,

2005.

7. He pleaded with the Appellant to reduce the interest

charged.

Exhibit C5, which was validated by the Respondent and

upheld by the learned trial Judge, by its very terms,

demonstrated that there was an equitable mortgage

between the parties. The Respondent by his said letter,

Exhibit C5 acknowledged that the title deeds in issue had

been deposited with the Appellant as security for the loan

granted to his son, Dr. Animashaun. The Respondent even

acknowledged that nterest was charged by the Appellant on

the loan, which he had been paying.

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By the further payment of N5 million, the Respondent

admitted that outstanding balance was N12 million in

favour of the Appellant. He only appealed for a reduction of

the said interest charged. No acrimony or hostility was

evident in the relationship between the parties, as

perceived by the tenor of Exhibit C5.

Only oral assent is required for creation of an equitable

mortgage. In Usenfowokan v. Idowu (1975) 4 S.C.

(REPRINT) 136, the Supreme Court, per Sowemimi, JSC

said:

"It is a well established rule of equity that a deposit of a

document of title without either writing or word of mouth

will create in equity a charge upon the property to which

the document relates to the extent of the interest of the

person who makes the deposit."

An equitable mortgage may thus be created without word

of mouth but with mutual understanding and a clear

intention that the purpose for the deposit of the title deeds

was for a mortgage. See also: Ogundiani v. Araba

(supra).

It is important to note that the fact that CW11, Form 917,

was impugned did not diminish or derogate from the clear

intention to create an equitable mortgage, more so in light

of

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the admission in Exhibit C5, which has not been

discredited. The evidence adduced thus proved

unequivocally that there was an equitable mortgage

between the parties. Issue 1 is accordingly resolved in

favour of the Appellant.

Issue 2

Having held that there was an equitable mortgage between

the parties, the resolution of this further issue is crucial.

This is because, if the evidence demonstrated that the

Respondent was unduly influenced to mortgage his

property, he would not be held accountable on the

transaction. A person who has been induced to enter into a

transaction such as a contract or guarantee, by the undue

influence of another is entitled to set that transaction aside

as against the wrongdoer. The effect of undue influence,

like duress, is to make the contract voidable. A party

cannot be held bound to an agreement where there has

been fraud, duress, undue influence or misrepresentation;

Alade v. Alic (Nig.) Ltd (2010) 19 NWLR (Pt. 1226)

111, (2010) LPELR-399(SC); Pan Bisbilder Nigeria

Ltd v. First Bank of Nigeria Ltd (2000) 1 NWLR (Pt.

642) 684 (2000)

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LPELR-2900. However, the Respondent was required to

prove his assertion; Famfa Oil Ltd v. A-G of the

Federation (supra); Hillary Farms Ltd v. M.V. Mahtra

(supra); Ohochukwu v. A-G of Rivers State (supra).

The Supreme Court in Bua v. Dauda (2003) 13 NWLR

(Pt. 838) 657, (2003) LPELR-810(SC), defined undue

influence thus:

"Undue influence is no doubt elusive of satisfactory

definition but it may be regarded as a state of mind of a

person who has been subdued to any improper persuasion

or machination in such a way that he is overpowered and

consequently induced to do or forbear an act which he

would otherwise do or not do of his own free will. It is a

product of the abuse or misuse of the confidence reposed in

someone who is able to put some pressure on or take unfair

advantage of another's necessities or distress: see Black's

Law Dictionary, 6th Edn. page 1528."

Black's Law Dictionary 9th Edition at page 1666 defined

'undue influence' in this manner:

The improper use of power or trust in a way that deprives a

person of free will and substitutes another's objective.

Undue influence can be direct or covert. When there is

direct

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actual undue influence, the claimant would have to prove

affirmatively that the wrongdoer exerted undue influence

on him to enter into the particular transaction which is

impugned. Undue influence was described by Lindley LJ in

Allcard v. Skinner (1887) 36 Ch D 145, as

"... some unfair and improper conduct, some coercion from

outside, some overreaching, some form of cheating and

generally, though not always, some personal advantage

gained."

Where undue influence is covert or presumed, the claimant

has to show that there was a relationship of trust and

confidence between the complainant and the wrongdoer of

such a nature that it is fair to presume that the wrongdoer

abused that relationship in procuring the complainant to

enter the impugned transaction. If the complainant proves

the existence of such relationship under which the

complainant generally reposed trust and confidence in the

wrongdoer, the existence of such relationship raises the

presumption of undue influence. The relation of banker and

customer will not normally give rise to a presumption of

undue influence, but it can do so in exceptional cases if the

customer has placed himself entirely

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in the hands of the bank and has not been given any

opportunity to seek independent advice.

The issue of undue influence has received more serious

attention globally especially as concerns elderly persons or

dependent adults. The Final Report on Undue Influence:

Definitions and Applications, presented in March 2010 to

The Borchard Foundation Center on Law and Aging, being

a project supported by the Center, made the following

findings, inter alia:

'Despite wide variations in the contexts and circumstances

in which undue influence and coercive persuasion in

general have been explored, the findings are remarkably

similar in terms of the salient features. Psychologists,

sociologists, criminologists, victimologists, legal experts,

and Courts have focused on the following:

1. Victim characteristics contributing to vulnerability

include incapacity resulting from dementia, mental illness,

or impairment; deficits in judgment or insight; altered

states of mind (which may be induced), resulting from

medications, sleep deprivation, etc.; emotional distress

(which may also be induced). Some analysts and

p r a c t i t i o n e r s h a v e n o t e d t h a t p e o p l e w i t h

"dependent personalities" are at heightened risk...

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2. Influencers' power. Experts agree that to constitute

undue influence influencers must be in positions of power

or authority toward those they influence. They may be in

positions of trust or confidence, which can be formal (e.g.,

the powerful person has a legal duty toward the less

powerful person, as in the case of fiduciaries) or informal

(as in the case of family members or neighbors)...

3. Improper actions or tactics. Influencers take

affirmative steps or actions to persuade victims to engage

in behaviors that are contrary to their interests in ways that

exceed what is considered to be "normal" persuasion...

4. Unfair, improper, "unnatural," or unethical

transactions or outcomes. Legal experts generally agree

that to constitute undue influence, harm must result such

as the loss of assets or property or inadequate care. Legal

experts have focused on transactions that are considered

unfair or improper by objective measures or what is

considered "reasonable," such as the sale of victims'

property below market value, or gifts made by victims that

are not commensurate with the length and quality of their

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relationships with recipients. Other examples that are

suggestive of undue influence are when those executing

documents cannot explain them...'

The evidence was that the Respondent was blind for about

40 years and was over 80 years old. He had been a

customer of the Appellant for more than 40 years. As a

result of his physical disability, he said that he reposed

confidence and trust in his banker, which is natural

reaction and not unlikely. An allegation of undue influence

by an elderly physically challenged customer of the

Appellant therefore cannot be casually disregarded. The

allegation of undue influence appeared to have weighed on

the mind of the lower Court as the learned trial Judge

concluded thus, page 180 of the Record of Appeal:

"In the instant case, the claimant maintained his testimony

that he was subjected to undue influence by the 1st

defendant. Whilst the acts of the 1st defendant officials in

this case might not be interpreted to be positive acts of

oppression their act of persuading the claimant to assist his

son, knowing that he the claimant reposed confidence in

their judgment bearing in mind his age and physical

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impairment could be described to be unconscionable

behavior. This observation does not in any way affect my

earlier findings that the purported surety or guarantee of

the 1st defendants loan to Dr. Fatai Animashaun and

purported mortgage of the claimants (sic) landed

properties at Aisa Animashaun Crescent, Ilupeju were null

and void (sic) of no effect due to 1st defendant undue

influence and the failure of the 1st defendant to enter into a

contract of guarantee with the claimant."

I believe that a further evaluation of the evidence that was

presented to the trial court would assist in the resolution of

whether there was proven undue influence as alleged. In

his witness depositions which were in line with his

pleadings, the Respondent stated, pages 11-15 of the

Record of Appeal:

8. Sometime in 2002 or thereabout, the 1st defendant,

through its officials, wrongfully procured and/or induced

me to stand surety for some advances arrangement it was

to make with my first son. Dr. Fatai Animashaun, with

respect to the amount of N10 million for which the title

documents of my landed property at Aisa Animashaun

Crescent, Ilupeju, Lagos would be deposited with the

1st defendant.

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9. On or about the year 2002 or thereabout, the 1st

defendant wrongfully procured and/or induced me to

deposit the title deeds to my landed properties consisting of

five (5) buildings... purporting to create a mortgage in

favour of the 1st defendant over the properties vis-à-vis

loan or loans granted or to be granted to Dr. Fatai

Animashaun by the 1st defendant.

10. I was induced to do the acts and things mentioned in

paragraphs 8 and 9 thereof and each of them by the undue

influence of the 1st defendant and under their direction and

pursuant to the faith, trust and confidence I reposed in

them as my bankers but without any separate or

independent advice and without due consideration of the

reasons for or the effect of what I was doing.

12. Later the 1st defendant invited me to its head office at

Marina, Lagos where its official convinced me that it was

safe and alright for me to so stand surety and deposit my

title deeds

13. For this, an official of the 1st defendant who had known

me when the official was at its Ilupeju Branch came over to

my house at Ilupeju many times to convince me.

In his 2nd Statement on Oath, the Respondent deposed:

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8. The official of the 1st defendant who kept visiting me at

my residence and piled pressure on me to enter into the

transaction is one Mr. Idowu Ogungbemi who was then at

the 1st defendant's Ilupeju branch.

The Appellant denied these very weighty allegations and

put the Respondent to strict proof of any such visit from

their official. And indeed, the burden to prove undue

influence lay on the Respondent; see Pan Bisbilder

Nigeria Ltd v. First Bank of Nigeria Ltd (2000) 1

NWLR (Pt. 642) 684, (2000) LPELR-2900, where the

Supreme Court, per Achike, JSC said

"Reliance on... undue influence must be established by

positive evidence or strong inference that can be drawn

from the surrounding circumstances."

The Respondent had been the Appellant's customer for

more than 40 years. He was well known to them. He

deposed that they knew of his physical disability. The

Respondent also testified that he had not sought

independent advice before entering into the transaction,

but placed himself entirely in the hands of the Appellant.

But, he did not say that he was not given any opportunity

by the Appellant to seek

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independent advice. The failure to seek independent advice

was therefore his personal choice and decision. My

difficulty with the evidence of the Respondent regarding

undue influence, however, is that it was somewhat bare

faced, his evidence was without necessary specifics. He

testified that one Mr. Idowu Ogungbemi staff of the 1st

defendant who had known him came over to his house at

Ilupeju many times to convince him on the merit of the

transaction. The designation of this said official was not

supplied. DW1 under cross examination admitted that a

certain Mr. Idowu Ogungbemi had been their staff at the

Ilupeju Branch but that the said Mr. Ogungbemi had

retired. DW1 said he did not know if Mr. Ogungbemi had

liaised with the Respondent. No names or official

designations of the staff of the Appellant, even at its head

office, who were alleged to have mounted undue pressure

on the Respondent to enter into the transaction with the

Appellant ab initio were supplied. To my mind, for the

Appellant to be held accountable for any alleged conduct of

its official, more detail ought to be supplied, and the official

of the Appellant ought to be of sufficient caliber that

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would indeed be in a position to exert undue influence on

the Respondent. For instance, a bank teller is a staff of the

bank. But would a bank teller be viewed as being of

sufficient caliber a staff as to exert undue pressure on a

customer of the bank to enter into a mortgage with the

bank? Most unlikely. Aside from supplying the name of Mr.

Idowu Ogungbemi, what his designation was within the

establishment of the Appellant was not supplied. The

Respondent said he was invited to the Appellant's head

office at Marina, Lagos where its official convinced him

that it was safe and alright for him to stand surety and

deposit his title deeds with the Appellant. No name or

designation of a Head Office official of the Appellant who

mounted pressure on the Respondent to enter into the

transaction was supplied. This Court cannot speculate on

what the designation of Mr. Ogungbemi was at the material

time or of any other unidentified staff or official of the

Appellant. No Court of justice engages in speculation to

arrive at objective deductions and conclusions; Agip

(Nigeria) Ltd v. Agip Petroleum International (2010)

LPELR-250(SC); African Continental Bank Plc v.

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Emostrade Ltd (2002) 4 S.C. (Pt. 11) 1, (2002)

LPELR-207(SC). N10 million is no mean sum of money for

one to be unduly influenced to guarantee without even

knowing who exactly did the influencing. From the

evidence, the Respondent was not mentally impaired. He

was an intelligent man who had over the years conducted

his business successfully, regardless of his physical

impairment. A bank customer for over 40 years would at

least know the name of his Branch manager or of his

personal banker. But neither the branch manager nor his

personal banker was named as a culprit. I am of the firm

view that having regard to the seriousness of his

allegations, the Respondent ought to have descended to

specifics. Any attempt to fill the gaps in his evidence by this

Court would be teeming with speculations.

It is also significant that under cross examination, page 117

of the Record of Appeal, the Respondent said:

"I trusted them i.e. the 1st Defendant they never gave me

documents to sign, I gave it to them voluntarily at the start

I did not know what they are(sic) doing until the last

moment. They never gave me my documents when I gave

them my document the 1st

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Defendant did not deceive me. Yes they did not wrongfully

influence me."

In other words, under cross examination, the Respondent

appeared to have countered his allegations of undue

influence. I find it very difficult to accept the said allegation

of undue influence as the evidence adduced to ground this

allegation fails to add up to give an affirmative conclusion.

In addition, Exhibit C5, which the Respondent admitted as

being his letter, and which has already been reproduced in

part above, was not a hostile letter. It did not create the

impression that the Respondent had been unduly

influenced to enter into the transaction. For emphasis, I

shall again reproduce Exhibit C5, in part:

"I want to thank you for your letter dated 13th day of

October, 2005, which was sent to me...

While thanking you for granting me extension of time to

balance the above-named account of N17,000,000.00k

(Seventeen million Naira) not later than 31st day of

December, 2005.

May I respectfully refer the Bank to the following events. I

respectfully ask the Bank to give me reasonable reduction

in the interest of N17,000.000.00k (Seventeen

Million Naira).

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I refer the Bank to please note that I Mortgaged my

properties originally for the sum of N10,000,000.00k (Ten

million Naira) which was granted for the action, but

without my knowledge my son, Dr. F. O. Animashaum, got

further transaction for the sum of N3,000,000.00 (Three

Million Naira) without any authority from me but for the

interest I have being having(sic) with the Bank I accepted

the N3,000,000.00 (Three million Naira) as part of my

Guarantee by signing further committment(sic) to the Bank

...

So far, I must thank you again for granting me an extension

of time to settle the interest of N17,000,000.00k

(Seventeen million Naira) for which I respectfully and

naturally ask you to reconsider the interest and let me have

my Security which I pledge(sic) to the Bank.

Meanwhile, I attached(sic) herewith a cheque No

"03360027" for the sum of N5,000,000.00k (Five million

Naira) for your consideration as final payment of the

Interest on the Mortgaged Loan, and let me know what

date I could send for the collection of the Securities that I

pledge(sic) for the Mortgaged Loan."

The impression created by this letter is that the

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parties had a cordial business relationship under which the

Respondent had deposited the title deeds to his properly to

secure the facility of N10 million granted to his son. A

further sum of N3 million was granted by the Appellant to

his said son on the same facility but without his prior

knowledge and approval. He made this point but went on to

accept responsibility for it. In the said Exhibit C5, the

Respondent pleaded to have a reduction of the interest

charged. The evidence adduced before the trial Court

therefore lends support for a conclusion that the parties

had a cordial business relationship. It would appear the

Respondent subsequently changed his version of this

relationship to be one under which he was unduly

influenced or induced by the Appellant to deposit his title

deeds without being fully cognitive of the implications of

his action. The evidence adduced however does not lend

support to this new version. I agree with the Appellant that

no undue influence was proved to ground the conclusion of

the learned trial Judge on this allegation. Issue 2 is

therefore resolved in favour of the Appellant. Accordingly,

the two issues distilled for

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determination are resolved in favour of the Appellant.

The Appellant sought orders of this Court setting aside the

judgment of the lower Court and entering judgment in their

favour on their counter claim. In the Counterclaim, the

Appellant sought the following orders, page 99 of the

Record of Appeal:

i) The sum N29,241,098 Twenty-Nine million, Two hundred

and Forty One Thousand, Ninety-Eight Naira only) with

interest at the rate of 28% per annum from the date of this

counter-claim to judgment and thereafter at 6% till the final

liquidation.

ii) Cost of this action.

The Appellant's entitlement to interest, whether for the

loan facility granted or pre-dating any judgment given in

the event of a default, must be strictly proved by evidence.

This is a well-established principle of law. In Diamond

Bank Ltd v. Partnership Investment Co. Ltd (2009) 18

NWLR (Pt. 1172) 67, (2009) LPELR-939(SC), the

Supreme Court, per Ogbuagu, JSC said:

"... the general rule at Common Law, is that interest is not

payable on a debt or loan in the absence of express

agreement or some course of dealing or custom to that

effect. See London Chattam and Dover Railway v.

South

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Eastern (1893) A.C. 249. Thus, interest will however, be

payable where there is an express agreement to that effect

and such agreement may be inferred from a course of

dealing between the parties. See Re-Duncan and Co.

(1905) 1 Ch. 307 or where an obligation to pay interest

arises from the common or usage of a particular trade or

business and I add like in banking."

A.G. Ferrero & Company Ltd v. Henkel Chemicals

Nigeria Ltd (2011) LPELR-12(SC); Edosa v. First Bank

of Nigeria Plc (2011) LPELR-8785(CA); Olam

(Nigeria) Ltd v. Intercontinental Bank Ltd (2009)

LPELR-8275(CA); International Trust Bank Plc v.

Kautal Hairu Co. Ltd (2005) 3 NWLR (Pt. 968) 443;

In -T ime Connect ion L td v . I ch ie (2009)

LPELR-8772(CA). In Midas Bank Plc v. Commerce

Progetti (Nigeria) Ltd (2009) LPELR-8263(CA) this

Court, per Garba, JCA restated the general legal principles

on the claims and award of pre-judgment interests in civil

matters as follows:

"The law is that prejudgment interest on a debt or loan can

only be awarded where there is sufficient evidence of an

agreement between the parties that such interest would be

paid. The agreement should contain details such as:

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(a) Rate of interest

(b) Date of commencement

(c) Date due; whether weekly, monthly, yearly or other

specified period.

However even where such an agreement was not entered

into expressly by the parties, its existence would be readily

implied where the plaintiff or judgment creditor is a bank

or lending institution because of the custom in that trade or

under the principle of equity, EKPEYONG v. NYONG

(1975) SC 71, BARCLAYS BANK v. ABUBAKAR (1977)

10 SC 13, HIMMA MARCHANTS v. ALIYU (1994) 5

NWLR (Pt. 347) 667, VEE PEE IND. LTD v. COCOA

IND. LTD (2008) 13 NWLR (1105) 486 @ 513. In line

with these authorities therefore, pre-judgment interest can

only be awarded in the following circumstances to be

established by evidence: -

(a) Express agreement of the parties or

(b) Existence of mercantile or trade custom, or

(c) Under a principle of equity such as a breach of fiduciary

relationship.

In particular, where there is sufficient and credible

evidence of an agreement of the parties, containing all the

essential details of the interest payable on the debt or loan,

a Court would have no option than to give effect to such

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agreement. This is based on the principles that parties are

bound by the terms and conditions of an agreement freely

entered between themselves and the duty of the Court to

give effect to that agreement."

DW1, the Marketing Manager of the Appellant testified

under cross examination that Exhibit CW11 was the only

record the Appellant had on the deposit of the title

documents and that there was no interest rate indicated on

the said document. Exhibit CW11 was discredited by the

lower Court and there was no appeal against that finding of

the Court. As the evidence stood, although there was a total

sum of N13 million advanced to the Respondent's son, no

agreed rate of interest between the parties to govern the

transaction was in evidence. There was also no evidence of

the Central Bank of Nigeria prescribed rate of interest to

guide bank loan facilities of that nature. In other words, the

exact rate of interest used in calculation of interest was not

in evidence, and, the Court cannot speculate on that fact;

Agip (Nigeria) Ltd v. Agip Petroleum International

(supra); African Continental Bank Plc v. Emostrade

Ltd(supra).

DW1 had testified that

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although the Respondent's total exposure stood at

N47,241,099.72, the Appellant had on compassionate

grounds waived some of this sum and conceded that the

Respondent should pay the sum of N30 million in full and

final settlement of his liability on the transaction. He

further testified that by the time this suit was instituted,

the Respondent had repaid N18 million, leaving the sum of

N12 million outstanding. See paragraphs 16 and 17 of the

written deposition at page 102 of the Record of Appeal.

This evidence was in tandem with the terms of the letter

Exhibit C5 acclaimed by the Respondent himself. By the

letter Exhibit C5, the Appellant acknowledged that there

was an outstanding interest of N17 million but that he paid

in a further N5 million, leaving a balance of N12 million. In

other words, both the Appellant and the Respondent, as

demonstrated by the evidence of DW1 and by Exhibit C5,

the letter written by the Respondent, acknowledged an

outstanding on the loan facility of N12 million before the

suit leading to the instant appeal was instituted. This is the

figure accepted by both parties from the evidence. The

basis for any further additional interest was

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not in evidence and again, this Court cannot speculate on

that fact; Agip (Nigeria) Ltd v. Agip Petroleum

International (supra); African Continental Bank Plc v.

Emostrade Ltd (supra). On the evidence therefore, the

Appellant is entitled to N12 million in full and final

settlement on the facility.

The Appellant also sought post-judgment interest of 6% on

the judgment sum. Post judgment interest cannot be more

than the rate provided in the Rules of Court; Unity Bank

Plc v. Nwadike (2008) LPFLR-5067(CA). By the High

Court of Lagos State (Civil Procedure) Rules, post-judgment

interest shall not exceed 10% per annum. The Appellant

has however asked for 6% post-judgment interest and they

are entitled to this claim. The appeal is therefore

meritorious and is allowed.

CROSS APPEAL

The Respondent/Cross Appellant formulated two issues for

determination in the cross appeal as follows:

1. Whether the lower Court, considering the case before it,

ought to make a definite finding on the Claimant's claim of

undue influence.

2. Whether the Claimant is not entitled to pre-judgment

interest in the absence of any contradictory evidence at

the

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trial with respect to such claim.

Issue 1 is similar to the Issue 2 as formulated by the

Appellant/Cross Respondent in the main appeal, which has

already been resolved in favour of the Appellant/Cross

Respondent. The point was made in the main appeal that

the allegation of undue influence weighed on the mind of

the lower Court as stated in its conclusion, page 180 of the

Record of Appeal. It was however found and held in the

main appeal that undue influence was not proved to ground

the said conclusion of the learned trial Judge on the

allegation of undue influence. Issue 1 of the cross appeal is

therefore resolved against the Respondent/ Cross

Appellant.

The Respondent/Cross Appellant in the lower Court, sought

an award of 21% interest on the sum of N18 million said to

have been paid to the Appellant/Cross Respondent from

9/11/2005 until payment, relief 5 of the Statement of Claim,

page 9 of the Record of Appeal. The learned trial Judge

refused this relief but rather awarded post judgment

interest at the rate of 10% per annum from judgment until

liquidation. The issue of interest pre-dating judgment was

laboriously considered in resolving the counter

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claim of the Appellant/Cross Respondent. The point was

well made that interest sought by a claimant, pre-dating

judgment must be strictly proved by evidence; Diamond

Bank Ltd v. Partnership Investment Co. Ltd (supra);

Midas Bank Plc v. Commerce Progetti (Nigeria) Ltd

(supra). No evidence of any such agreement between the

parties regarding pre-judgment interest was adduced by

the Respondent/Cross Appellant. There is therefore no

basis for such consideration in this cross appeal. Moreover,

by the decision in the main appeal, the cross appeal has no

leg to stand and it is therefore liable to be dismissed.

In all, this appeal is meritorious and is hereby allowed. The

decision of the High Court of Lagos State in Suit No:

LD/2364/2005 delivered on April 28, 2008 is hereby set

aside. It is further ordered that the counterclaim of the

Appellant is granted in the sum of N12 million with interest

of 6% per annum on the judgment sum until liquidation.

It is also ordered that the cross - appeal be and is hereby

dismissed.

Parties are to bear their costs.

JUMMAI HANNATU SANKEY, J.C.A.: I had the benefit of

reading

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before now the draft of the lead Judgment of my learned

brother, Otisi, J.C.A. just rendered and I agree with her

reasoning and conclusions.

Accordingly, for the reasons given by her, I would allow the

Appeal. I also dismiss the Cross Appeal for lacking in merit.

I abide by the consequential orders made in the said

leading Judgment.

JOSEPH EYO EKANEM, J.C.A.: I had the privilege of a

preview of the lead judgment of my learned brother, Otisi,

JCA, which has just been delivered. I agree with the

reasoning and conclusion therein which I adopt as mine in

allowing the appeal and dismissing the cross-appeal. I

abide by the consequential orders made in the Lead

Judgment.

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Appearances:

Chief A. Adeniji, with him, E. F. Ogunbanowo(Mrs.) and Ugochi Ekeugo (Miss.)For Appellant(s)

B. A. M. Fashanu, SAN with him, O. A. Ilori-Adeogu (Mrs.) For Respondent(s)

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