TRANS BRIDGE CO. LTD. V. SURVEY INT. LTD.
| Pages | 1084-1122 |
1084
NIGERIAN SUPREME COURT CASES
[1986] 2 N.S.C.C.
I have had the privilege of reading the draft of the judgment just delivered by
my learned brother Obaseki, J.S.C. where he had carefully reviewed the findings
of facts made by the lower courts in the light of the submissions made by learned
counsel for the appellants; and I am satisfied and agree entirely with the conclu-
sions reached therein that no valid case has been made to make this court inter-
fere with and reverse those findings of fact.
In the circumstances, I will also dismiss the appeal and affirm the decision of
the Court of Appeal with N300.00 costs to the respondents.
Appeal dismissed.
TRANS BRIDGE CO. LTD. V. SURVEY INT. LTD.
5
10
15
TRANS BRIDGE COMPANY LIMITED
APPELLANT
V
SURVEY INTERNATIONAL LIMITED
RESPONDENT
SUIT NO. SC 17/1985
20
SUPREME COURT OF NIGERIA
ESO,
UWAIS,
COKER,
KARIBI-WHYTE,
KAWU,
11th July, 1986
J.S.C.
J.S.C.
J.S.C.
J.S.C.
J.S.C.
25
Commercial Law - Conzpany Law - Legal personality - Pre-incorporation contracts
-
Legal effect - Enforceability - Equity - Offer - Lapse of time to act on
30
repudiation.
Equity - Estoppel - Mitigating effect of - Courts of Law - Duty to do justice
case by case - Equitable and promissory estoppel - Meaning and applicability
-
Basis of applicability - Legal relationship, precondition - Law and equity -
35
Relationship.
ISSUES:
1.
Who can invoke equity?
2.
Whether a company is entitled in equity to enforce a pre-incorporation.
40
3.
Whether the rules of equity can exist in isolation of common law rules.
4.
Whether there are any limitations as regards the application of rules of equity.
5.
Whether an order of specific performance can be invoked to enforce a
contractual agreement which had lapsed by reason of non-performance.
6.
When would the doctrine of promissory estoppel apply in a case and what is
45
its effect in equity?
7.
Whether the doctrine of promissory estoppel can be used as a basis for
instituting an action.
FACTS:
The respondent company offered to sell one of its landed property to one of
50
the promoters of the appellant company. The transactions between the parties
were carried on as if the company was already come onto being. A time limit with-
in which the offer was to be acted upon was agreed upon by both parties, which
time limit expired without the offer being acted upon, due to the inability of the ap-
TRANS BRIDGE CO. LTD. V. SURVEY INT. LTD.
1085
pellant company's promoters to obtain the consent of their financiers and co-pro-
moters for the purchase of the said property. A fresh agreement was not entered
into by the promoters of the appellant company and the respondent company
throughout this period.
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Later on, the financiers gave their consent to the purchase and the same was
communicated to the respondent company. However, the respondent company
was no longer willing to sell the property on the terms formerly agreed upon. The
appellant company this time had been incorporated and thus commenced an ac-
tion in court to enforce (i) "its right" for specific performance of the pre- incorpor-
10
ation contract and (ii) that the respondent company be estopped from varying the
terms of the contract and (iii) damages for the breach of the contract in the alter-
native.
The High Court found for the appellant company and granted the reliefs sought.
The respondent company appealed to the Court of Appeal and the decision of the
15
lower court was reversed. The appellant thus appealed to the Supreme Court.
HELD:
1.
Only an existing person - natural or artificial can invoke equity; such persons
must also be a party to the transaction into which equity is to be invoked.
2.
It is a fundamental principle of law that pre- incorporation contracts are not
20
binding on a company and they cannot be enforced by a company even in
equity, for equity cannot be invoked where the legal right relied upon is
unconscionable.
3.
The rules of equity cannot in isolation of common law rules since equity follows
the law. The common law rules act as a base upon which the rules of equity
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stands.
4.
Even though the rules of equity will prevail where there is a conflict between the
rules of equity and common law, the Judicature Act of 1873 and 1875 never
abolished the distinction between equitable rights and legal rights.
5.
A defaulting party to a contractual agreement cannot invoke an order for
30
specific performance against the other party to the contract after the expiration
of the time within which the contract was to be performed because the lapse of
time would have vitiated the contractual agreement.
6.
The doctrine of promissory estoppel will apply in a case where there two parties
who are contractually bound and one of them relying on the representation of
35
the other, acted on that representation thereby altering his own position, the
person making the representation will not be allowed by the court to go back
on his representation. This doctrine operates to prevent the promissor from
insisting on his strict legal rights because it will be inequitable for him to do so.
7.
The doctrine of promissory estoppel operates only as a defence against the
40
party that has made out the representation to the other party to the contract, it
cannot be used as a basis of instituting an action.
CASES REFERRED TO IN JUDGMENT:
1.
Ajayi v.
R.T.
Briscoe (Nig.) Ltd.
(1964) 3 All E.R. 556.
45
2.
Amalgamated Investment
Co.
Ltd. (lnliquidation) v. Texas Commerce Interna-
tional Bank Ltd.
(1981) 1 All E.R. 923.
3.
Axioni v. Davidsons (Manchester) Ltd.
(1952) 1; Lloyds (1981) 3 All E.R.
577. Rep. 527.
4.
Bagot Pneumatic Tyre
Co. v.
Clipper Pneumatic Tyre
Co. (1902) 1 Ch. 146.
50
5.
Birmingham & District Land Co. v. London & N.W. Ry.
Co. (1888) 40 Ch.
268.
6.
Buttery v. Pickard
(1946) W.N. 25, 134.
7.
Caligara v. Giovanni Sartori & Anor.
(1961) 1 All N.L.R. (Pt.3) 534.
8.
Canadian Pacific Rly
Co. v.
The King
(1931) A.C. 409.
1086
NIGERIAN SUPREME COURT CASES
[1986] 2 N.S.C.C.
9.
Central London Property Trust Ltd v. High trees House Ltd.
(1956) 1 All E.R.
256, 258.
10.
Charles Rickards Ltd v. Oppenhein
(1950) 1 K.B. 616.
11.
Combe v. Combe
(1951) 2 K.B. 215 at p.220.
12.Crabb v. Arun D.C.
(1976) 1 Ch. 179.
5
13.De
Bussche v. Alte
(1878) 8 Ch. D. 286 at 314.
14.Dean v. Bruce
(1952) 1 K.B. 11, 14.
15.Edokpolo's Co Ltd. v. Sem Edowire Industries Ltd.
(1984) 7 S.C. 119.
16. E.R.
Investments Ltd. v. High
(1967) 2 Q.B. 379 at 399.
17.Re
English and Colonial Produce Company Ltd.
(1906) 2 Ch. 435, 442.
10
18. Evenden v. Guildford Football Club
(1975) 1 Q.B. 917
19.Fenner v. Blake
(1900) 1 Q.B. 406
20.Firgos (Nigeria) Ltd v. Zetters (Nigeria) Pools Ltd
(1965) L.L.R. 113.
21.Gentle v.
Faulkman
(1900) 2 Q.B.D. 267, 274-275.
22.Howard v. Patent Ivory Manufacturing
Co (1888) 38 Ch. D. 156.
15
23. Hughes v. Metropolitan Rly
Co. (1887) 2 App. Cas. 439, 448.
24.Joseph v. Lyons
(1884) 15 Q.B.D. 280.
25.Jorden v. Money
(1854) 5 H.L. Cos 185.
26. Kelner v. Baxter
(1866) L.R. 2 CP. 124.
27.Lola Beni Ram v. Kundun Hall
L.R. 26 A.A. 58.
20
28.Liverpool C.C. v. Irvin
(1976) Q.B. 311, 332.
29.Manchester Brewery
Co.
v. Combs
(1901) 2 Ch. 608,
617.
30.Melhade v. Porto Alegre Rly
Co. (1874) L.R. O.C.P. 503.
31.Moorgate Mercantile
Co.
Ltd v. Twitchings
(1975) 3 All E.R. 311.
25
32. National Motor v. Mail Coach Co.
(1908) 2 Ch.515
33.Nehanel Freies S.A. v. Et General; Grain Co.
(1970) 1 Lloyds Rep. 53.
34.Newbome v. Sensolid (G. B.) Ltd
(1954) 1 Q.B.D. 45, 51.
35.
Wood house A.C. Israel Cocoa Ltd S.A. v. Nigerian Produce Marketing
Co.
Ltd.
(1972) 2 All E.R. 271.
30
36.
Re
Vandervvell Trusts (No.
2) 1974 Ch. 269, 332.
37.Ramsden v. Dyson
(1866) L.R. 1 H.L. 129, 140-141.
38.
Wilmot
v.
Barber
(1880) 15 Ch. D. 96, 105-106.
39.Re
Express Engineering Company
1880 16 Ch. D. 125.
40.
Touche v. Metropolitan Railway
Co. (1971) 6 Ch. App. 671.
35
41.Re
National Mail Coach
(1908) 2 Ch. 515.
42.Odufunade v. Ososami
(1972) U.I.L.R. 101.
43.Obaseki v. A.C.B. & Anor.
(1966) N.M.L.R. 35.
44. Ives
Investments Ltd. v. High
(1967) 2 Q.B. 379, 399.
45.N./.P.C.
Ltd. v. Bank of West Africa Ltd.
(1962) 1 All N.L.R. 556.
40
46.Kilner v. Frana
(1946) K.B. 83.
47.Strickney v. Keeble
(1951) A.C. 366.
48. Panchaud Freies S.A. v. Establishments General Grain Coy.
(1970) 1 Lloyd
Rep. 53.
49.Penry v. Suffields Ltd.
(1916) 2 Ch. 187.
45
50.Spillers v. Paris Skating Rink Co.
(1877-78) 7 Ch. D. 368.
51.Re
Hereford and South Wales Engineering Co.
(1875-76) 2 Ch. D. 621.
52.
Taylor Fashions v. Liverpool Victoria Trustees Company
(1981) 1 A.E.R.
897.
53.Ogilvie v. West Australian Mortgage v. Agency Corporation
(1896) A.C. 587,
50
592.
54.
Tyne Mutual Steamship Insurance Association v. Brown
(1916) 85 L.J.K.B.
1408.
55.Plimmer v. Mayor Wellington
(1884) 9 App. Cas. 699. 713.
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