Alhaji Balele Rafukka V. Ahmadi Kurfi (1996)

LawGlobal-Hub Lead Judgment Report

MOHAMMED, J.C.A.

The appellant in this appeal was the owner of landed property known and called Rafukka Supermarket at Katsina covered by a statutory certificate of occupancy No. NC 2480 dated 30th December 1976. In order to secure loan and overdraft facilities, the appellant mortgaged this property to the Union Bank of Nigeria Plc., which as an unpaid mortgagee advertised and sold the property by public auction through an auctioneer to the respondent. The property was sold to the respondent at the cost of N200, 000.00 after complying with all the necessary requirements by a Deed of assignment duly executed and registered in the land registry at Katsina. Following the purchase of the property, the respondent applied for and was duly issued with a new statutory right of occupancy No. 4174 after the revocation of the appellant’s original certificate of occupancy No. 2480. The revocation of the appellant’s certificate of occupancy was duly communicated to the appellant. The respondent then orally and in writing requested the appellant to vacate the property and allow the respondent vacant possession. On refusal by the appellant to deliver possession of the property to the respondent, the respondent went to the lower court and filed an action asking for a number of reliefs including a declaration that the property was validly assigned to him by the Union Bank, that the appellant is no longer the holder of the right of occupancy No. 2480 as the right had been revoked by the Governor, that the appellant is now a trespasser on the said property and an order ejecting the appellant from the property.

After pleadings have been exchanged between the parties, the case went to trial before Sanusi J., of the Katsina State High Court of Justice. At the end of the trial, the learned trial Judge in his judgment delivered on 7/6/94 granted all the reliefs sought by the respondent as the plaintiff against the appellant who was the defendant in the action at the trial court. Aggrieved by the decision of the trial court, the appellant has now appealed to this Court. His notice of appeal dated 18th July, 1984 contains four grounds of appeal from which the following 3 issues were formulated in the appellant’s brief of argument.

1. “Whether or not the Bank has a valid title in respect of Rafukka Supermarket at Katsina to pass to the respondent and if the answer is yes whether or not all condition precedent to enable the said Union Bank pass a valid title to the respondent were satisfied by the Bank.
2. Whether or not the evidence adduced in this matter was properly evaluated by the trial Judge in view of the provision of Sections 53 and 74 of the Evidence Act as regard Exhibit B, a subsisting judgment between the Bank, the respondent’s root of title to the disputed Supermarket and the appellant.
3. Whether or not the Bank’s reopening the issue of the appellant’s indebtedness to it (Bank) is proper in law in view of the fact that the issue had been adjudicated upon in Suit No. KTH/29/89 which was tendered in this Suit as Exhibit ‘B’ which is still a subsisting judgment up till date.”

Identical issues but worded differently were also identified in the respondent’s brief of argument. The 3 issues in the respondent’s brief read:-

1. “Whether or not the Union Bank as unpaid mortgagee has a valid title pertaining to and in respect of Rafukka Supermarket at Katsina to pass to the respondent.
2. Whether or not there was a proper evaluation of the evidence adduced in this matter by the learned trial Judge before arriving at a just decision in this case.
3. Whether or not Estoppel per-rem judicata operates against the respondent in this suit in view of Exhibit ‘B’ tendered by the appellant in this matter.”

Having examined these issues as raised in the respective briefs of the parties to this appeal, I am of the view that the issues as identified in the appellant’s brief although not elegantly framed clearly arose from the 4 grounds of appeal filed by the appellant. I shall therefore proceed to determine this appeal on these issues.

Precisely put, the first issue is whether the Union Bank of Nigeria Plc, had a valid title to the property known and called as Rafukka Supermarket Katsina which the respondent could have acquired by the purchase of the property. It was argued in the appellant’s brief that he did not mortgage the property in dispute to the Union Bank and that the issue of his indebtedness to the Union Bank was decided by the High Court since 1989 in the Judgment Exhibit ‘B’ which shows that the appellant was not indebted to the Bank to warrant the Bank to sell the property in dispute to the respondent. That having regard to the finding in Exhibit ‘B’, the Union Bank had no title to Rafukka Supermarket which it could have validly passed on to the respondent by sale. It was pointed out in the appellant’s brief that since Exhibit ‘B’ is a piece of evidence which is neither contradicted nor challenged it must be accepted by the trial court. Three cases including the case of Linus Onwuka & Anor. v. Omagui; (1997) 3 NWLR (Pt. 230) 393 (1992) 3 SCNJ 98 were cited and relied upon in support of this submission. It was further argued that since the respondent is a privy in the case decided in Exhibit ‘B’, he was bound by the decision in that case having regard to the case of Akinfolarin V. Akinola; (1994) 3 NWLR (pt. 335) 739 (1994) 4 SCNJ (Pt. 1) 30 at 48 – 49 until that judgment is set aside on appeal by a court of competent jurisdiction. Learned counsel for the appellant concluded his argument by stressing that the respondent being a privy and successor in title to the Union Bank is bound by the decision in the judgment Exhibit ‘B’.

It was however submitted for the respondent that having regard to the evidence on record which had established that the loan on which the property in dispute was secured by mortgage with the Union Bank was outstanding as the result of which the Bank decided to exercise its power to sell the secured property and duly advertised the same for sale through auction, the purchase of the property by the respondent after complying with all necessary conditions duly conferred title on the respondent. The case of Okafor & Sons Ltd. v. Nigeria Housing Development Society (1972) NSCC 271 at 278 was cited in support of this argument. The respondent further pointed out that once the Union Bank as mortgagee has exercised its powers of sale, the purchaser who is the respondent in this case is not concerned to see whether an occasion has arisen which makes the power exerciseable or whether the power is properly exercised as any person such as the appellant if he is prejudiced by an improper sale has a remedy in damages against the person exercising the power. In support of this argument, the case of Oguchi v. Federal Mortgage Bank (Nig.) Ltd. (1990) 6 NWLR (Pt. 156) 330 at 343 was cited and relied upon by the respondent.

This issue of whether the Union Bank of Nigeria had title to the property in dispute which it could have passed on to the respondent was also raised at the lower court and the learned trial judge made a number of findings based on the evidence before him. The first finding was on the indebtedness of the appellant to the Union Bank. The learned trial Judge found that the appellant was duly granted loan and overdraft facilities by the Union Bank. That the loan and overdraft duly secured by the property in dispute through legal mortgage remained unpaid by the appellant after repeated demands by the Bank. That as at the time the appellant’s Rafukka Supermarket was sold by auction to the respondent on 1/12/89; the appellant was indebted to the Union Bank to the tune of N101, 460.00. That although the appellant denied being indebted to the Bank or mortgaging his landed property in dispute to it, he was not able to support this assertion by convincing evidence. The learned trial Judge’s conclusive finding on this issue at pages 13 – 14 of his judgment reads

“Thus in the light of the aforesaid, I am left with no colour of doubt in my mind that the defendant had mortgaged the landed property in question for the sum he was loaned by the Bank. The said mortgage has been valid one since all the prerequisite conditions of mortgage has been sought and obtained before the execution of the mortgage. The Bank therefore can and indeed has derived valid title of the land when the loan agreement became due and was defaulted by the defendant. Thereupon, the title of the land became duly transferred to the Bank regarding the said landed property. The Bank can therefore be legally right to transfer such title of the land to any purchaser upon the latter’s payment of the sum agreed by the Bank through any form of deed of sale through public auction or manner of sale.

On the plaintiff’s purchase of the said land as an innocent purchaser the title of the land can be said to have properly passed to him through his purchase of the said from the mortgagee i.e. Bank. Having not been shown to been aware that power of sale by the Bank has not become exercisable he can be said to have really acquired an unimpeachable title of the said land. See Oguchi’s case (supra).”

These findings and conclusions of the learned trial Judge are indeed fully supported by the evidence on record. The fact that the appellant mortgaged the property in dispute to the Union Bank in return for a loan and overdraft facilities is not at all in doubt as the Deed of mortgage executed by the parties was in evidence. The fact that the loan secured by the mortgage was not fully repaid by the appellant when, it became due is also in evidence through PW 2. Therefore, the Union Bank as an unpaid mortgagee duly armed with the documents of title to the property in dispute through the Deed of Mortgage, namely certificate of occupancy No. 2480, had all what was required for it to be able to transfer title to the property to the respondent. There is clear evidence from PW 2 at page 38 of the record that as the result of the appellant’s failure to pay his liability to the Bank, the Bank advertised the appellant’s property Rafukka Supermarket for sale by public auction. The respondent having shown an interest in the property by offering to purchase the same and duly purchased the same at an auction had indeed acquired a valid title to the property. There is no doubt that vesting a legal title in respect of landed property in a person is a matter of law. Being a matter of law entirely, its determination lies entirely within the exclusive domain of the learned trial Judge. See Gankon v. Ugochukwu; (1993) 6 NWLR (Pt. 297) 55 (1993) 6 SCNJ (Pt. 11) 263 at 273. Therefore in the present case, the conclusion reached by the learned trial Judge based on the evidence before him that the respondent had acquired a valid title to the property in dispute to justify granting him all the reliefs he asked for in the action is quite in order.

It is important to note that incident to every mortgage is a right of the mortgagor to redeem. This right is generally referred to as the right of redemption. The right to redeem is so inseparable an incident of a mortgage that it cannot be taken away even by an expressed agreement of the parties that the mortgage is not to be redeem or that the right is to be continued to a particular time or to a particular description of persons. The right continues unless and until the mortgagor’s title is extinguished or his interest is destroyed by sale either under the process of the court or of a power in the mortgage deed. Ejikeme v. Okonkwo; (1994) 8 NWLR (Pt. 362) 266 (1994) 9 SCNJ 131 at 140. Therefore in the present case the power of sale having been exercised in accordance with the Deed of Mortgage between the Union Bank and the appellant, the appellant’s title to the mortgaged property had been extinguished or destroyed by the sale of the property to the respondent.

Perhaps it is not out of place to remind the appellant that having mortgaged his Supermarket to the Union Bank to secure the loan granted to him, the Bank had a potent weapon of a mortgagee to exercise its power of sale on the only condition that it acts in good faith. Warner v. Jacob (1882) 20 Ch. D. 220 cited with approval by the Supreme Court in Eka-Eteh v. Nigerian Housing Development Society Ltd. (1973) 6 SC 183 at 198 is the authority for the preposition that –

“If it mortgage exercise his power of sale bona fide for the purpose of realising his debt, and without collusion with the purchaser, the court will not interfere, even though the sale is disadvantageous, unless the price is so low as in itself to be evidence of fraud.”