OBIMIAMI BRICK V. A.C.B. LTD.

• Pages: 428-472

428

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NIGERIAN SUPREME COURT CASES

[1992] 1 N.S.C.C.

Appeal being incompetent is struck- out. I adopt the order as to costs made by

my learned brother,

Wali, J.S.C.

OMO, J.S.C.

I have had the privilege to read in draft the judgment of my learned

brother,

Wali, J.S.C.,

in this appeal. I agree entirely with the views therein

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5

expressed and the conclusion arrived thereat. I also hold that the court below

erred in granting leave to appeal after the expiry of the three months for appeal

from the Court of Appeal to this Court by wrongly relying on Practice Direction No.

1 of 1989.

10

This appeal is accordingly allowed with N1,000.00 and N500.00 costs in this

court and the court below respectively.

Appeal allowed.

15

OBIMIAMI BRICK V. A.C.B. LTD.

OBIMIAMI BRICK & STONE (NIG.) LTD.



APPELLANT



20

V.

AFRICAN CONTINENTAL BANK LTD.



RESPONDENT

APPEAL No. SC. 18

6

/

1

990.

SUPREME COURT OF NIGERIA



25

KAWU,



J.S.C.

WALT,



J.S.C.

0 LATAWU RA ,



J.S.C.

OMO,



J.S.C.

BABALAKIN,



J.S.C.



30

27th March, 1992.

Appeal - Findings of fact - When may appellate court intetfere.

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35

Contract - Breach of - Effect - Enforcement - Duty of court thereto

Damages - Remoteness of - Whether a court can consider same in the absence of pleading

by defendant in respect thereof - Breach of contract - Failure of banker of credit -

Measure of damages therefor.

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40

Evidence - Uncontroverted and unchallenged evidence - Reliance thereon by court -

Whether material where a party for no justifiable reason decides to opt out of the

proceedings.

Practice and Procedure - Pleadings - What constitutes - Whether can be a substitute for

evidence required in proof of facts pleaded - Counter-claim - Party filing and

45

abandoning same without leading evidence - Proper order to make in respect thereof-

Dismissal of claim - Need for court to give reasons therefor - Party opting out of

proceedings - Effect of

Words and Phrases - "Contract" - Meaning of

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50

OBIMIANI1 BRICK V. A.C.B. LTD.

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429

ISSUES:

1. Whether a pleading can be a substitute for evidence required in proof of the

facts pleaded?

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2. What is the effect where a party for no justifiable reason opts out of

proceedings?

3. What order should a court make where a party who files a claim or a

counter-claim abandons same without leading any evidence?

FACTS:

The appellant instituted an action in the High Court of Anambra State against

the respondent claiming the sum of N22,650,357.00 as special and general

damages arising from a breach of contract by the respondent.

The case for the appellant was that it was granted an import licence which was

15 valid for foreign exchange and it applied to the respondent for a loan to enable it

import the goods covered by the licence. The import licence was granted to enable

the appellant import the goods under the first-tier foreign exchange market (FFEM).

As part of the contract between the parties, the respondent was to open a letter

of credit in favour of the exporting company in Germany and to inform the

20 confirming Bank also in Germany of its issuance, so as to enable the German Bank

confirm the irrevocable letter of credit before 29th September, 1986, when FFEM

would cease to operate and SFEM come into operation. However, the respondent

did not send the telex message to the confirming bank in good time to enable the

confirming bank do its own part of confirming same before SFEM came into

operation. As a result of this, the appellant had to purchase foreign exchange

25

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under SFEM at greatly increased cost, resulting in a loss of N

.

1,697,800.00 which

the respondent agreed to bear.

The appellant further alleged that when the goods finally arrived the respondent

did not release funds as agreed upon for it to clear the goods in time and it had to

pay heavy demurrage and suffered substantial loss of profit.

30



The respondent's main defence without leading evidence, was that it fulfilled

its obligation to inform the confirming bank of the issuance of a letter of credit in

favour of the German Company on 25th September, 1986, the receipt of which was

confirmed to it on 26th September, 1986, but that the confirming bank refused to

confirm the letter of credit on the ground that it required cash backing for it. The

35 respondent also filed a counter-claim for a sum of N2,276,620.61 against the

appellant being overdraft with compound interest granted it. The counter-claim

was however not pursued and the trial court dismissed it.

The trial court found for the appellant and awarded it the sum of

N10,827,305.25 with costs assessed atN4,000. The trial court also made a number

40 of findings of fact in favour of the appellant based on the uncontroverted and

unchallenged evidence before it.

The respondent appealed to the Court of Appeal which allowed the appeal thus

reversing the findings of fact of the trial court, and an order was made that the

counter-claim be restored to the cause list in the trial court for hearing. The Court

of Appeal also nullified the damages awarded by the trial court on the ground of

45 remoteness of damage.

Dissatisfied, the appellant appealed to the Supreme Court contending,

inter

alia,

the Court of Appeal erred in reversing the findings of fact of the trial court and

that the issue of remoteness of damage should not have been considered since

it was not raised in the respondent's pleading.

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50

430



NIGERIAN SUPREME COURT CASES

[1992]

1

N.S.C.C.

HELD:

1.

Pleading is a mere notice and can never be a substitute for the evidence

required in proof of the facts pleaded: subject however, to an admission made

by the other party. Unless a party through skillful cross-examination discredits

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5

the case of the other party, he is still bound to lead evidence in support of his

own pleading.

(See

p.453,

lines

25 -

33).

2.

After both parties to a dispute have been duly notified of the hearing date, and

a party for no justifiable reason decides to opt out of the proceedings the case

presented by the other party, once it is not discredited in any legal way, should

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10

be the case to be considered on its merits. The intention of the other party why

it refuses to take part is not the business of the court.

(See p.456, lines 1 - 7).

3.

Where a plaintiff or a defendant who files a claim or a counter-claim abandons

his claim without leading any evidence the proper order to make is to strike out

the case or the counter- claim.

(See p.458, lines 29 - 31).

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15

In the instant case, the learned trial judge was wrong to have dismissed the

counter-claim.

4.

If a dismissal is meant to be, and in fact should be, a judgment of the court,

case was dismissed, non- suited or struck out. The reason for so doing must

reasons must be given. It is not for an appellate court to speculate on why a

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20

appear on the record of the lower court. It is not a case of discretion but in the

interest of justice that any party should know why he has lost or won a case.

(See p.458, lines 36 - 41).

Per

WALT, J.S.C:

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5.

Where a banker is found liable for breach of contract to open a confirmed and

irrevocable letter of credit, the measure of damages is that which it could

reasonably have been foreseen would flow from such a breach.

(See p.461,

lines 16 - 19).

Per

OMO, J.S.C:

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6.

A contract is an agreement whereby a person undertakes for reward

(consideration) to perform an act for another. Its terms are as contemplated

and admitted by the parties.

(See p.467, lines 29 - 32).

7.

A Court of Appeal will not lightly interfere with the findings of fact of a court of

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35

trial. To justify such departure it must be able to hold that such findings were

not based on the evidence before the court or were the results of wrong

inferences on evidence led, and therefore did not arise from a proper exercise

of its opportunity of seeing and hearing the witnesses which appeared before

it.

(See p.469, lines 3 - 8).

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40

8.

Once issues is joined on liability for and quantum of damages payable, a court

can in considering the issue joined decide whether or not the damages are

remote, irrespective of whether or not the defendant pleaded remoteness of

damage. It is not like special damages which must not only be pleaded but

strictly proved.

(See p.469, lines 36 - 40).

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Per

BABALAKIN, J.S.C:

9. It must be borne in mind that the simple operation of contract is that where

parties voluntarily agreed to do an act and one of the parties neglected or

defaulted from carrying out or doing what was agreed to be done, then there

is a breach of that contract by the party who neglected or defaulted in

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