Dr. Moses Obajimi V. Mr. P. T. Adediji (2007)

LawGlobal-Hub Lead Judgment Report

JOHN AFOLABI FABIYI, J.C.A.

This is an appeal against the judgment of Yerima, J. while sitting at the High Court of Justice in Ibadan, Oyo State of Nigeria on 28th May, 2003.

At the lower court, the appellant as plaintiff, claimed against the respondent, as defendant thus:

“1) A declaration that by the terms of the Memorandum of Understanding dated 04/02/1999 entered into by the plaintiff and the defendant at SW9/1406 Ring road, Ibadan and executed by the plaintiff and the defendant at the plaintiff’s office in Ibadan, the plaintiff is neither indebted to the defendant in the sum of N500, 000 (Five Hundred Thousand Naira) or indeed any sum at all, nor liable of refund the sum of N500, 000 (Five Hundred Thousand Naira) to the defendant nor indeed any sum at all.

2) The sum of N1, 000, 000 (One Million Naira) being general damages for breach of the aforesaid Memorandum of Understanding by the defendant on 30/04/1999.

3) 21% interest on the sum claimed from 01/05/1999 till judgment is given and thereafter at 21% till judgment sum is fully recovered.

4) Further and other reliefs.

5) Cost of this action.”

On his own part, the defendant counter-claimed against the plaintiff as follows:

“a) The sum of N500.000.00 paid by the defendant to the Central Bank of Nigeria as part of the Statutory Deposit on an agreement with the plaintiff to buy the plaintiffs International Insurance Group Limited which purchase was not conclusive.

b) Interest at the rate of 21% on the said sum of N500, 000.00 from 8th day of March, 1999 until judgment is given and thereafter until the entire Judgment sum is liquidated.”

The facts of the matter should be assembled, albeit briefly. The appellant wanted to sell his business concern, to wit: International Insurance Group Nigeria Limited and the respondent desired to buy same sometime in 1999. They entered Into a Memorandum of Understanding as in Exhibit 7 on 4-02-1999. Therein, it was agreed that the respondent shall complete the purchase price of N5, 000, 000 on or before 30th April. 1999. In addition, it was agreed that the respondent shall also bear some sundry expenses including statutory deposit with the Central Bank, As extant in exhibit 12, the respondent paid the sum of N500, 000 as statutory deposit to the appellant who paid same to the Central Bank of Nigeria.

As at 30-4-99 when the purchase sum should be paid in full, the respondent failed to fulfill his contractual obligation to the appellant as contained in exhibit 7. The appellant maintained that by the breach, he suffered colossal damages as he rebuffed other prospective purchasers of his concern. For some time, the respondent left the appellant in limbo and suspense.

On 26-10-99, the respondent wrote to the appellant to demand for the sum of N500, 000 paid to the Central Bank relying on Clause v(i) of exhibit 7 which provides ‘that in the event of the sale not conclusive the above stated expenses borne by the purchasers may be reimbursed by the Vendor.