Adecentro (Nig.) Ltd. V. Council Of Obafemi Awolowo University (2005)

LAWGLOBAL HUB Lead Judgment Report

PATS-ACHOLONU, J.S.C.

The appellant a construction company had entered into a contract with the respondent to construct a laboratory building and what is described as the general service and supply center at an initial price of N2,440,449.00 (two million four hundred and forty thousand four hundred and forty nine naira). The sum originally agreed to was later on revised upwards to N7,356,663.28 (seven million three hundred and fifty six thousand six hundred and sixty three naira twenty eight kobo). Some of the pertinent terms of the contract are;

(a) That the whole works should be completed within a period of 44 weeks.

(b) That the appellant if occasion so demands may apply for extension of time to complete the job.

(c) That the architects certificate is a condition precedent for payment.

The construction work was not completed within the due date agreed but the parties after several meetings agreed that the completion work be extended to 139 weeks. As late as the middle of 1985, the appellant applied for further extension of total of 67 weeks. According to the appellant, the consultant architect approved only for an extension of 35 weeks in spite of the protestation of the appellant. The appellant was equally piqued further in this seemingly jaundiced state of affair by the refusal or failure of the respondent to pay its entitlement to certificate No. 35 of the sum of N102,743.73. Subsequently the two parties each determined the contract. Feeling sorely about such a development the appellant instituted an action in the High Court.

The respondent on the other hand denied all liabilities and maintained that the unenviable situation was caused by the incompetence of the appellant in not putting the best men on duty and this resulted in perennial requests for extension of time which delayed the work and in turn had the resultant effect of escalating costs. With this in mind, the respondent then counter claimed for damages for a sum of N12,746,616.54. (Twelve million seven hundred and forty six thousand six hundred and sixteen naira fifty four kobo).

At the High Court, the suit of the appellant was dismissed while the counter claim succeeded. The award of damages was somewhat bizarre in the language it was given. I shall come to this later. An appeal to the Court of Appeal was dismissed, hence a final appeal to this court.

From the dizzying great number of grounds of appeal the appellant formulated 6 (six) issues for determination. They are as follows:

1. Whether the lower court was correct in upholding the learned trial Judge’s decision that the appellant was not entitled to the extension of time sought Grounds 1,2,3, and 5.
2. Whether the appellant was, in the circumstance and having regard to the contract entitled to any sums of money due in consequence of the extension of 67 weeks sought by it but which the respondent neither formally granted nor refused Ground 4.
3. Whether the two lower courts did not so misconstrue the first relief sought by the appellant as to occasion a serious miscarriage of justice Ground 17.
4. Which of the parties, having regard to the contract validly determined the contract or were the two lower courts right in holding that the respondent validly determined the contract Grounds 6,7,8,9,10,11,13,14,15.
5. Whether the respondent was entitled to the measure of damages as stipulated under the contract especially in the light of the holding of the court that the respondent did not determine the contract in accordance with the contract document – exhibit P2, but under the common law Ground 16.
6. Were reliefs granted in the counter claim proper in the circumstances Ground 18.

The respondent on its own adopted the issues framed by the appellant and argued its case based on the manner argued by the appellant.

The appellant’s grouse against the judgment of the Court of Appeal is in the lower court’s affirmation of the decision of the trial court. The High Court after dismissing the case of the appellant in particular stated as follows in that judgment;

As to the plaintiff’s claims in paragraph 26 and 27 of his further amended statement of claim, their success depend strongly on section 25(3) (a) of exhibit P2 the return of the equipment, tools and materials will wait until the whole project is finally and satisfactorily completed by another contractor. The defendants will then have the responsibility to return whatever remains of the equipment to the plaintiffs.

The counter-claims also succeed but they cannot take effect until after the successful completion of the project.

Section 25(3)(d) which is quoted above supply the full answer.