Corporate Liability in Civil Matters (NG) – Inioluwa Olaposi

N.B. This article is particular to Nigeria

Corporate Liability in Civil Matters

The liability of a corporate entity in a civil matter can be easily determined, as this is not as stringent as in criminal proceedings.

The burden of proof in a civil matter is on the basis of probability. But the guilt of an accused in a criminal proceeding must be proven beyond all reasonable doubt. ‘Private’ wrongs, are different from ‘public’ crimes.

Simply, the liabilities of a civil matter involving a corporate entity falls on the company, and not on its owners or director. In Yesufu and Another V. Kuppa International N.V ., the Supreme court held that where a director enters into a contract in the name of a company, or purporting to bind the company, it is the company, the principal, which is liable on it, not the director – the agent.

Clearly, the relationship that exists among a company, its capable official, and a third party, in the administration of contractual rights and liabilities is that of a principal, agent, and another. Wrapped in the Latin maxim, qui facit per alim facit per se – the acts of the agent (a director), within the scope of his authority, is directly that of the principal (the company). The agent cannot be held responsible for the actions which he does for the principal. The contract is essentially between the principal and the third party.

In similar vein, Tobi JCA (as he then was) in Kurubo v. Zach-Motison (Nigeria) Ltd, opined as follows:
“ In view of the fact that an artificial person or company vested with legal or juristic personality lacks the natural or physical capacity to function as a human being, those who work in it do all things for and on behalf of it…It is therefore the law and the tradition for the human beings authorized to negotiate agreement for and on behalf of the company. Where an agreement is so executed by a person in authority, the company is liable or deemed to be liable for the act or acts of the person.”

According to Section 276 of CAMA, 2020, anyone that acts for a company on the mere disguise of being its director, shall be personally liable for such unauthorized act, unless the company hold him up as being one.

Like an agent to his principal, the acts of the director that are without his scope of authority attracts personal liability. That is to say, the director of a company may become personally liable for his actions which are not within his scope of employment. He may also become personally liable if he contracted in his own name.

According to Section 94 (CAMA), a company shall be exempted from liability springing from the acts of an official or agent and a third party where there was collusion between them. Otherwise, the company will be liable, even where the act of the official or agent is fraudulent.

Notably, a company will also be exempted from civil liability where the third party had the knowledge (actual or constructive) that the general meeting, board of directors, or managing directors had no power to act in such a manner, or acted ultra vires or in an irregular manner of its powers. In other words, the law will not pat the back of a negligent third party, who knew of the unlawfulness of the actions of the directors, or should reasonably have known, as the case may be.

Again, there is no tight corner – so to speak- in liabilities of civil matters as they relate to corporate entities. It is largely a case of principal and agent relationship, with vicarious liability.

A Company as a Legal entity (NG) – Inioluwa Olaposi

N.B. This article is particular to Nigeria

A Company as a Legal entity

In modern times, the concept of ‘a person’ has gone beyond the gender classification of male, female, or groups of any other biological or scientific identity. The conduct of commercial transactions and its resultant effects have produced an expediency for the existence of a body distinct from these.

A company is capable, under law, of being regarded as a personality by incorporation. In other words, an entity made of no flesh and blood, intellect nor reasoning, without natural or material existence, that may not be touched, felt or seen, becomes a person under law.

This personality produced by law is capable of engaging in commercial transactions, like a natural person can. Certainly, natural men are the brain behind the formation of any corporate personality. However, the directors of this corporate entity are distinct from it in the eye of the law. These available legal capacities of an incorporated company have made possible the complexities involved in the conduct of modern business.

The case of Salomon v. Salomon & Co. Ltd [1897] AC 22 is generally recognized as the cornerstone of company law. This case established the principle that a company is distinct from its shareholders and would be treated as an independent entity with perpetual succession. A company has the right to sue and could be sued, in its acquisition of rights and dispositions of liabilities.

In the aforementioned case, Salomon transferred his boot making business, which he owned has a sole proprietor, to Salomon Ltd. (a company which comprised himself and his family as members). He was paid the price for the transfer by way of shares, and debentures having a floating charge on the company’s asset.

Later, the company failed and went into liquidation. Salmon’s right against debentures stood above the claims of unsecured creditors. If things were to be legally done, the other creditors would have recovered nothing from the liquidation process. Therefore, to avoid alleged exclusion, the unsecured creditors, through the liquidator, alleged that the company was nothing but an agent of Salomon. And therefore, Salomon, being the principal, should be personally liable for its debt. Evidently, the claim of the creditors has not recognized the company (Salomon Ltd.) has a separate legal personality from Salomon himself.

The Court of Appeal ruled in favour of the other creditors, declaring the company to be a myth. The court reasoned that Salomon incorporated the company in contradiction to the true intent of the Companies Act, 1862. Salomon should therefore be responsible for the debt, because the company had merely conducted business as his agent.

However, on appeal, the House of Lords reversed the above judgement, unanimously holding that since the company had been rightly incorporated, the motive of those who participated in its promotion is irrelevant. Therefore, the company is an independent legal personality with its rights and liabilities appropriate to itself. Therefore, the principle of ‘corporate veil’ between a company and its owners was firmly created by Salomon’s case.

It is now a recognized principle of company law that a company is responsible for its act, irrespective of the fact that those acts were performed through human instrumentation. The capacities of companies to sue and be sued presupposes that they could be sued for both civil and criminal liabilities. A company can also sue for both civil and criminal rights.

Domestically strengthening the foregoing, section 89 of the Companies and Allied Matters Act (CAMA) provides that “Any act of the members in general meeting, the board of directors, or a managing director while carrying on in the usual way the business of the company, shall be treated as the act of the company itself and the company is criminally and civilly liable to the same extent as if it were a natural person:’

As provided, the doctrine of ‘Separate Legal Entity’ is locally recognized and entrenched in the Nigerian Law, differentiating owners of a company from the corporate entity itself.

Laws of Nigeria (Constitution, Codes, Land Use Act etc.)

The Laws of Nigeria are divided majorly into Federal and State laws. In Nigeria, Bicameral legislation exists at the Federal level and unicameral legislation at the States. The Federal Legislature makes law for the whole federation. It is made up of the Senate and the House of Representatives. These are jointly called the National Assembly. The House of Assembly is the law making house at the States.

Below are some of the major laws of Nigeria.

Constitution of Nigeria 1999

The Constitution of the Federal Republic of Nigeria 1999 (as amended) is the grundnorm of the country. It is the law to which every state action and law is subject. Section 1 of the Constitution expressly provides for the Supremacy of the constitution. It is over and above any other law in the country.

Criminal Code Act / Penal Code Act

The Criminal Code Act, and it northern counterpart (Penal Code) provides broadly for series of actions and omissions constituting offences in Nigeria, and their attributed punishments. Section 2 of the Criminal Code Act defines an offence. That is, “An act or omission which renders the person doing the act or making the emission liable to punishment under this code, or under any Act, or Law.”

Evidence Act 2011

The Evidence Act 2011 is an act for the Federal Republic of Nigeria that regulates the admissibility, relevance and other processes relating to the use of evidences in a legal proceeding.

It is important to note that the proving of a fact in court relies on evidences. Therefore, awareness of the law as it relates to the acceptable procedure for administering evidences before a court is of crucial importance.

Land Use Act 1978

The Land Use Act vests all land in a state in the Governor of the State. This is subject to other provisions of the Act. This is in accordance with section 1 of the Act. It provides for the control and management of Land, rents, certificates of occupancy, etc.

Labour Act

The Labour Act of Nigeria is a central statute that provides for the relationship between an employer and the employee.

BOFIA 2020

The Bank and other Financial Institutions Act, 2020 provides comprehensively for the creation and regulation of financial institutions in Nigeria.

Regulation of Banking Business in Nigeria (Importance) – Inioluwa Olaposi

Importance of Regulation to the Banking Business

Over the years, the banking environment has faced periodical challenges that have culminated, or threatened to culminate, in its lack of efficiency and operational failure.

In reference to the early development of the banking system, history has remarked that to have the banking business largely unregulated is a definite way to prepare it for its systemic or total impairment. This realization is affirmed evidentially all over the world, and particularly in Nigeria. 

Before delving into the downfall of banks, as occasioned by lack of any or enough regulations, it is expedient to grasp an understanding of the word ‘bank’ and ‘bank regulation’. 

In Lubcon Limited v. Classmate Technologies co. Ltd (2019) LPELR-47414(CA), the bench remarked that, “A bank has been defined by the Black’s Law Dictionary, eight edition as a financial establishment for the deposit, loan exchange or issue of money, and for the transmission of money. A quasi public institution for the custody and loan of money, the exchange and transmission of the same by means of bills and drafts.”

Also, a Bank regulation is a form of government regulation which subjects banks to certain requirements, restrictions and guidelines, designed to create market transparency between banking institutions and the individuals and corporations with whom they conduct business, among other things. (Wikipedia)

Foreign Jurisdictions

All over the world, it is realizable from experience that leaving regulations out of any society will lead to chaos and anarchy. In fact, one of the primary reasons any government is set up in any society is to define and enforce required laws for the orderliness of such society. The banking system is not an exception to this. Thomas Hobbes is renowned to have pointed out that life without a government would be ‘nasty, brutish, and short.’

The United State of America is well recognized has one of the most developed economies in the world, and does not also lag in the banking environment. However, the free banking era of the country (1834 to 1864), which was characterized by lack of federal control and regulation of its banking milieu, suffered several banking crises and financial instability. It made for a disorderly currency characterized by thousands of different banknotes circulating at varying discount rates (Investopedia). Little wonder the era had to come to an end with the introduction of the National Banking Act of 1863, which brought in some new regulations. 

China, on its own end, has in operation some of the most trusted banks in the world. However, the ‘Jiaozi’ was a form of banknote which appeared around 10th century in the Sichuan capital of Chengdu, China. These notes were totally run by private individuals (between 960 and 1004), until the government decided to regulate the business on alleged increasing fraud cases and disputes, and licensed 16 biggest merchants.

Similar situations can be spotted in other countries like Switzerland, affirming the fact that banking without the backing of relevant regulations is undesirable, and can be destructive, as the case was in Nigeria. 

Failure of Early Banks in Nigeria

It has been pointed out as generally observed that the lack of banking regulations was one of the factors that resulted in the failure of the banks established in Nigeria between 1929 and 1952. However, deeply, it can be argued that the absence of adequate regulations that could work for the then situation of the country was what resulted in the establishment of the failing indigenous banks in the first place. 

The earliest banks that started operating in Nigeria, like the Bank of British West Africa (BBWA) [Now First Bank of Nigeria Ltd.] and the Barclays Bank D.C.O [Now Union Bank of Nigeria Plc.], were established basically as instruments of the effective operation of the financial transactions of the then British colonial administration and other British commercial interests.

In light of the aforementioned fact, it is not surprising to realize that these banks were concerned mainly with keeping and maintaining accounts of British personnel, officials of British commercial houses, expatriate civil servants, other private British professional people. Although, there were hundreds of Nigerian customers maintaining saving accounts, indigenous current account holders were comparatively few, and only in exceptional cases were there Nigerian borrowers. 

In a nutshell, a major failure of the earliest expatriate banks, in catering for the Nigerian banking community, was their lack of active interest in the businesses of the indigenous people. Such a failure as this, could have been avoided by the formation of adequate ordinances for banking operations in Nigeria. 

Failure of Early Indigenous Banks in Nigeria

In light of the point mentioned of early banks hereinbefore, and other possible factors, indigenous banks began to spring up in the country’s banking system. The first among which was the Industrial and Commercial Bank, set up in 1929. Unfortunately, this bank failed within its first year of operation. Many other banks were established in the country which also failed in their operations, until 1952. 

These indigenous banks failed due to a number of reasons, including insufficient capital, poor management and poor record-keeping, rapid expansion of offices, illiquidity, fraudulent directors, reckless and imprudent lending, fierce competition from expatriate banks, and of course, the absence of banking regulations to specify their code of conduct. These indigenous banks even had the power to issue their own legal tender, however, there are no evidences to prove that any of them did. 

Some of the other banks that were established in Nigeria between 1929 and 1952 include the Nigerian Mercantile Bank, Agbonmagbe Bank, The African Continental Bank (ACB), Pan Nigerian Bank, Nigerian Trust Bank, Provincial Bank of Nigeria, United Commercial Credit, Mainland Bank, Nigerian Farmers and Commercial Bank, and Industrial Bank and West Africa Bank.

The Financial Secretary to the government during the debate on the 1952 ordinance in the House of Representatives had remarkably said, “The situation at present is that there are over 170 companies registered with the registrar of companies using the word ‘bank’. 

Obviously, all that was needed to start a bank before any specific banking regulation in Nigeria was to register a company with the word ‘bank’. 

G.D. Paton Committee

Going forward, the failure of the Penny Bank in 1946 moved the then colonial government to set up a Panel of Enquiry to look the banking practices in Nigeria, and give recommendations. This committee was headed by G.D. Paton. Although this committee submitted its recommendations a month after which it was set up, nothing was carried out as an effect until 1948. 

The report of the committee set out, as a first of its kind, guidelines for the operation of Nigerian banks. Every upcoming bank was to meet these guidelines and existing banks were granted a three-year period to comply with them. 

The recommendations of the G.D. Paton Commission were to finally form the basis of the first banking statute in Nigeria, the Banking Ordinance of 1952, which was repealed by the Banking Ordinance of 1958 [Cap. 19]. The Central bank of Nigeria was established in 1959, as well as the foundation of the country’s money and capital market. 

Since the first Banking Ordinance of 1952, the operations of the Banking system of Nigeria has evolved into what it is today. There has been significant reduction in the rate of failure of banks, and the confidence of the public in the banking sector has been strengthened. Presently, the banking business in Nigeria is regulated by two main statutes – the Central Bank of Nigeria (Establishment) Act, and the Banks and Other Financial Institutions Act (BOFIA), 2020

In conclusion, it is evidently undesirable to leave the steering of the banking sector of a country to the sole dictates of its directors, most especially when these directors are ardent capitalists. It is therefore crucial for any state that desires a developing banking sector to make appropriate and sufficient regulations for the operations of the sector.

See Statues:

DEFAMATION: Definition, Types, Distinctions, Vulgar Abuse (NG) – Inioluwa Olaposi

N.B. This article is particular to Nigeria.

Defamation in Torts

Defamation is the lowering of a person in the estimation of right-thinking members of the society. In other words, defamation is an abuse on someone’s reputation by another person.

Historically, there were many defamation cases in Nigeria in the early 1960s, involving the press and different political personalities. This was because the post-independence era was characterised by vigorous political activities, combined with free press. Let us now dig deeper into what constitutes a defamatory statement.

A defamatory statement is one that tends to lower the plaintiff in the estimation of right-thinking members of the society; or to expose him to hatred, contempt or ridicule; Or to cause other persons to shun or avoid him; or to discredit him in his office, trade or profession; or to injure his financial credit.

This definition has been given judicial credence in a plethora of cases. These include the Court of appeal case of Enertech Eng. Co. Ltd v. Alpha praxis Nig. Ltd (2014). And Sun Publishing Ltd & Ors v. Dumba (2019) (CA).

See also: Nuisance in torts

In the Supreme Court case of Chilkied Security Services and Dog Farms Ltd v. Schlumberger Nigeria Ltd & anor (2018), Kekere-ekun J.S.C. remarked, “Defamation, as a tort, whether as libel or slander, has been judicially defined to consist of the publication to a third person or persons of any words or matter which tend to lower the person defamed in the estimation of right thinking members of society generally or to cut him off from society or to expose him to hatred, contempt, opprobrium or ridicule or to injure his reputation in his office, trade or profession or to injure his financial credit.”

General Public or Particular Section

Note that for an action on defamation to succeed, the statement made must be defamatory in respect to the public generally, and not just ‘a particular section of the public’. The lowering of the plaintiff in the estimation of a particular section of the public may not amount to defamation.

In Egbuna v. Amalgamated Press of Nigeria Ltd. [1967] 1 All N.L.R. 25 at p. 30., the term ‘a particular section of the public’ was defined as “a body of persons who subscribe to standards of conduct which are not those of society generally.”  

The foregoing is evident in the case of Byrne v. Dean [1937] 1 K.B. 818. In this case, the plaintiff belonged to the same golf club as the defendant. The plaintiff alleged that the defendant had defamed him by putting up a notice in the club. The notice was to the effect that the plaintiff had made a report to the police about certain illegal gaming machines kept on the club premises.

Simply, the court held that the defendant’s statement could not be defamatory. The standards of the members of the club were not those of the society generally. In fact, a reasonable man in the society would find the action of the defendant praiseworthy.

Also, the standard of determining a right-thinking member of the society is that of a normal reasonable man.  Not polluted by extra-conscientious or censorious characteristics. In other words, the court does not regard the ‘I-don’t-care’ people. Or those who may be so emotionally weak that they regard every simple negative statement as defamatory. See Winfield and Jolowicz on Tort (1975). See also the words of Per Adefarasin J., in Awolowo v. Kingsway Stores (Nig.) Ltd. (1968) 2 All N.L.R. 217 at p.230.

Types of Defamation

A defamatory statement can be of two types;

  • Libel, or
  • Slander

Libel is a defamatory statement in a permanent form. On the other hand, Slander is defamation on a temporary or transient form. Most common libels are written or printed words, which may be found in a book, newspaper, letter, etc. Slander is most often done through the medium of spoken words or gesture.

Distinction between Libel and Slander

Historically, libel and slander were separate torts. But today, they are treated as two aspects of a single tort called Defamation. Both are generally governed by the same principles. Two major differences between libel and slander are as follow:

  1. As earlier mentioned, libel is defamation in a permanent (usually written) form. While Slander is defamation in temporary form, spoken or gesture
  2. Libel is always actionable per se, while slander is not. This means that there is no need to prove actual damages in a libel action. Slander is not actionable per se, except in certain cases.

In Nthenda v. Alade (1974) 4 E.C.S.L.R. 470, the plaintiff brought an action that an article published by the defendants was defamatory to him. The defendants were the proprietor, the editor, and a reporter of the Lagos Weekend newspaper. They argued that the plaintiff’s action should fail because he had not proved that he has suffered any actual damage as a consequence of the publication.

However, Bello S.P.J. restated the position of the law, that in an action for libel, the plaintiff need not prove that he had suffered any actual damage as a consequence of the publication. Both malice and damaged are presumed from the publication itself, in the absence of lawful excuse.

Therefore, once a publication is found to the libelous, the law presumes damage.

See also: Fundamental Human Rights under 1999 Constitution

Situations when Slander can be actionable per se

A slanderous statement can be actionable without the need to prove damages (actionable per se) in the following circumstances.

  1. Direct imputation of Crime. Like calling the plaintiff ‘a thief’ assertively.
  2. Imputation of contagious or repulsive diseases. This would definitely make others shun or avoid the plaintiff. Such diseases may be contagious skin infirmities, leprosy, etc.
  3. Imputation of unchastity or adultery. See section 1 of the Slander of Women Act 1891, Section 5 (1) of the Defamation Law of the eastern States, and Section 4 of the Defamation Law of the western States. In Kerr v. Kennedy [1962] 1 K.B. 409, ‘unchastity’ was held to include lesbianism.
  4. Imputation affecting professional business reputation. Like saying that a lawyer knows no law, or that a banker is bankrupt.

What to Prove in an action for Defamation?

For an action in Defamation to succeed, the plaintiff must prove three important things:

  1. That the words were defamatory
  2. That the words referred to the plaintiff
  3. That the words were published (to at least one person other than the plaintiff).

These points to be proven has been given judicial recognition in the Court of Appeal case of Wala v. FGN (2020). Also, that the words must be published has been restated in Dairo v. Union Bank & Anor (2007), in the Supreme Court.

Vulgar Abuse

It is worthy of notice that a statement is not defamatory if it is mere vulgar abuse. What does that mean? A vulgar abuse is an ‘insulting’ statement made in the heat of passion.

For example, in Bakare v. Ishola [1959] W.N.L.R. 106, there was a fight between the plaintiff and the defendant. In the heat of passion, the defendant said in the presence of onlookers, “ole ni o, Elewon, iwo ti o sese ti ewon de yi.” This in English meant, “You are a thief. Ex-convict. You who has just come out of prison.

That court held that the statement was mere vulgar abuse, and not defamatory.

However, in a case of libel (written or printed defamation), the defendant cannot rely on vulgar abuse as a defense. See Benson v. West African Pilot Ltd. [1966] N.M.L.R. 3. In this case, the defendant published a defamatory statement in their newspaper, to the effect that the plaintiff was “an idiot and a simpleton”. The court rejected the contention that the report was mere vulgar abuse and not actionable.

See also: Nigerian cases on Defamation


  • KODILINYE and ALUKO: The Nigerian Law of Torts pg. 136-145
  • Lecturer’s note. Dr Alayinde. Faculty of Law. Obafemi Awolowo University, Ile-Ife.

Nuisance: Definition, Public, Private, Distinction (NG) – Inioluwa Olaposi

N.B. This article is particular to Nigeria.

Nuisance in Torts

Nuisance in a layman’s parlance is any annoying activity perpetrated by another party. However, the tort of nuisance possesses a stricter and narrower meaning than this.

In Tort, Nuisance can be said as the ‘unlawful’ interference with the enjoyment of public bliss, or of land by an occupier. Hence, not all annoying occurrence is actionable in Tort as Nuisance. Nuisance in Tort is usually unlawful, but not always.

According to Clerk and Lindsell, Nuisance is an act or omission which is an interference with or annoyance to a person in the exercise or enjoyment of:

  • a right belonging to him as a member of the public, when it is public nuisance;
  • his ownership or occupation of land or some easement, profit or other rights used or enjoyed in connection with land, when it is a private nuisance.

This definition by Clerk and Lindsell has been given judicial credence in the Supreme Court case of IPADEOLA & ANOR. v. OSHOWOLE. (1987) LPELR-1531(SC).  However, the court also noted, in line with the words of the authors, that, “An actionable nuisance is incapable of exact definition and it may overlap with some other heading of liability in tort such as negligence or the rule in Rylands v. Fletcher.”

Going forward, Nuisance can either be Public or Private.

In the case of ADEDIRAN & ANOR v. INTERLAND TRANSPORT LTD (1991) LPELR-88(SC), the Supreme Court held that, “Nuisance is an act of commission tending to interfere with, disturb or annoy a person or persons in the exercise or enjoyment of a right belonging to that person or persons; if the person whose right is so infringed is an individual, the nuisance is a private one, but when it affects the public or a class of the public, it is then a public nuisance, whereas the private nuisance is within the competence of the victim to prosecute civilly, the public nuisance is a criminal matter for prosecution by the Attorney-General.”

This aforementioned holding on ‘What constitutes nuisance’ by Per SALIHU MODIBBO ALFA BELGORE, JSC, has shed light on a lot of what would be said below.

See also: Defamation in Torts

Public Nuisance

A Public Nuisance is committed when an act that affect the general public or a section of it is carried on. In other words, a Public Nuisance interferes with the enjoyment of ‘orderliness’ by the general public.

This is the case, for example, when a Factory emits fumes that affects the entire neighborhood. Or when an unlawful structure is erected on a public highway, causing obstruction.

Public nuisance is a crime. And it is actionable only by the Attorney-General, except when there is ‘particular damages’ on an individual.

An individual can bring an action to court against a public nuisance, when he has suffered ‘particular damages’ by the interference. This ‘particular damages’ must be such that is over and beyond the ordinary damages suffered by other members of the society.

For example, in the case of Savage v. Akinrinmade (1964) L.L.R. 238, the defendant’s obstructing of a public street interfered with the access of staff, parents, and pupils to the plaintiff’s school. In this case, particular damage was established.

However, in the case of Amos v. Shell-B.P. (Nigeria) Ltd. (1974) E.C.S.L.R. 486, the defendants constructed a temporary dam across a public navigable creek, interfering with the order of the whole community. In an action by the whole community of persons, Holden C.J. held that the action must fail.

The action above might have succeeded, if brought by just one individual, who proves substantial ‘particular damage’ suffered as a result of the actions of the defendants over that suffered by others.

Needful to mention that under the Common Law, any individual that intends to bring an action under public nuisance must obtain the consent of the Attorney General. Such a restriction is now void by virtue of Section 6(6)(b) of the 1979 Constitution, which is the same Section 6(6)(b) of the 1999 Constitution.

Private Nuisance

Private nuisance is a substantial interference with the enjoyment of land by the owner or occupier of such land, as a result of the actions of another.  

Private nuisance, unlike Public nuisance, is designed to protect the interest of owners or occupiers of land from any form of impediment to the enjoyment of their land that may arise as a result of another party’s substantial interference.

From IPADEOLA & ANOR. v. OSHOWOLE (SUPRA), Per KAYODE ESO, JSC, held that, “ … it is certainly a private nuisance, if there is interference with some easement or profit or any other right accruing to a person or his land.”

See also: Trespass to Land

Categories of Private Nuisance

Private nuisance may be classified into three categories, namely:

  1. Physical injury to plaintiff’s property: e.g., where the plaintiff’s farm is affected by the fumes from the defendant’s factory.
  2. Substantial Interference with the plaintiff’s use and enjoyment of his land: for example, when the loud sound of machines emanating from the defendant’s factory can be heard in the plaintiff’s residence.
  3. Interreference with easements and profits, e.g., where the defendant wrongfully obstructs the plaintiff’s right of way or right to light.  

Distinctions between Public and Private Nuisance

Flownig from the foregoing, let us now consider some differences between Public and Private Nuisance.

  1. A public nuisance affects the public generally, while a private nuisance affects a party privately.
  2. Public nuisance is a crime, and a tort when particular damage is proved by an individual. However, private nuisance is solely tortious.
  3. Public nuisance is actionable by the Attorney General, while private nuisance is not.
  4. To succeed in Private Nuisance, the plaintiff must have an interest in the land. Such an interest is unnecessary in an action arising under public nuisance.

Similarities between Public and Private Nuisance

Having mentioned the distinctions above, it must be noted that the difference between the two forms of nuisance is not watertight.

  1. There may be occasions where a single action may give rise to liability in both public and private nuisance.
  2. Also, there must be substantial interference for liability to arise under both categories.


Kodilinye and Aluko: The Nigerian Law of Torts

Trespass to Land: Definition, Scope, Remedies, Defences (NG)

N.B. This article is particular to Nigeria.

Trespass to Land

Trespass to Land is intentionally entering into land, remaining on land, placing or projecting any object upon land in possession of another, without lawful justification.

Anyone in possession of land may maintain an action against any intruder who makes an unauthorised entry. The form of action that existed for this type of unauthorised entry of land was ‘ trespass quare clausum fregit’. That is, trespass because he has broken the close . ‘Close’ in colloquial parlance meant enclosure but trespass may be committed on unenclosed tracts of land.

How trespass to land can be committed

Trespass to land may he committed in any one or more of the following ways:

  1. Unauthorised entry into the land.
  2. By abusing the right of entry.
  3. Placing or projecting some object upon the land.

Who Can Sue For Trespass to Land?

A trespass to land is a wrong against possession . Any unlawful interference with land or building in possession of another is actionable. Therefore to succeed, the plaintiff must show that he is in possession of the land . Matthew Echere & ors v Christopher Ezirike (2006) 12 NWLR pt 994 336.

In Olagunju v Yahaya (2005) All FWLR pt 247 1466 para a – b, the court held as follows:

” Trespass is a wrong committed against a person who is in exclusive possession of the land trespassed
unto. When a parcel of land which was trespassed onto was in lawfully exclusive possession of
another person, a suit in trespass is not maintainable by the owner who had no right to immediate
possession at the time the trespass was committed. “

The circumstances where one who does not have possession of land can sue for trespass as seen in Soleh Boneh Ltd v Ayodele [1989] 1 NWLR pt 99 549 at 551, where the Supreme Court said as follows;

Where the trespass has caused a permanent injury to the land hereby affecting its value, a person not
in possession but he is entitled thereto in reversion can sue for injury to his interest without waiting till
his future estate falls into possession.

Ugoji Vs. Onukogu (2005) ALL FWLR (Pt. 271) 66 @ 78 paragraphs C-E
Amakor v. Obiefuna (1974) 1 All NLR (Part 1) 119.

Note that even a person in wrongful possession can bring an action for trespass against anyone who unlawfully enters the land except the true owner or anyone acting in the authority of the owner.

It should also be noted that trespass to land is a wrong repressible per se . This means that mere entry upon land or building in the possession of another without lawful authority is actionable trespass even if no damage is caused . – Stirling Civil Engineering (Nig) Ltd v Ambassador Mahmood Yahya (2001) All FWLR pt 263 628 at 646.

Acts of Trespass

  1. Trespass by unjustifiable or wrongful entry
    This is regarded as the commonest form of the trespass to land . It involves personal entry by the defendant or some other person procured by the defendant into a land or building in possession of the plaintiff . The slightest crossing of the boundary of the plaintiff is sufficient to enable him recover damages. – Inyang v Registered Trustees of the first century
    gospel church (2006)
    All FWLR pt 314 279 at 301.

    Where the defendant intentionally entered into the plaintiff’s land, he may still be liable in trespass and it would not avail him to say he acted under a honest but mistaken belief that he was on his own land or that he has the right of entry or that the land is public land – Ugoji v Onukogu (supra).

    Note that entry can be above or below the surface ground or into the airspace above the land.
  2. Abuse of Right to Entry:
    If the defendant refuses to leave after expiration of his right of entry or use of land, he becomes a trespasser.

    Alternatively, if due to the misbehaviour of the defendant, the plaintiff revoked his right to be on the land and the defendant ignores a request to quit , he is a trespasser. – Balogun v Alakija (1963) 2 ANLR of 115.

    Therein, A employed B as a rent collector. One night after business hours, B allowed A to enter his house, but shortly afterwards, an argument ensued and B asked A to leave and A became abusive and assaulted B. He did not leave B’s house until about fifteen minutes after he had been requested to leave. A was held liable to be in Trespass.
  3. Placing or Projecting Some Objects Upon the Land:
    Placing any material object on land in possession of another is trespass. Similarly, projecting an object onto the plaintiff’s land.

    Note that the act causing the trespass must be direct or immediate and not indirect or consequential.
    Thus, where the defendant throws any object onto the plaintiff’s land, it is trespass but to pile or gather rubbish near the plaintiff’s land may constitute nuisance and not tort.

    In the case of Onasanya v. Emmanuel (1973) 4. CCHCJ 1477. The complaint of the plaintiff was that the defendant encroached about ten feet upon land in his possession when the defendant was laying foundation of a building. Further that the defendant had thrown water and refuse into his land and allowed excreta to escape onto his premises.

    It was held that throwing water and refuse were direct acts and this amounted to Trespass while the escape of excreta was indirect invasion and therefore not trespass but nuisance.

    Where a person wrongfully occupies a property in the possession of another or wrongfully places any object thereon, he will be liable for continuing trespass which is actionable from day to day, so long as the trespasser or the object remains on the land. See the case of Andrew Okito v. Vincent Obioru (2007) All FWLR pt. 365 pg 568.

Scope of Trespass to Land

The owner of the land is presumed to own everything beneath it, the centre of the earth and above it to the heavens .

This is expressed as “Cuius est solum, eius est usque ad coelum et ad inferos”. See the case of Corbett v. Hill (1870) L.R 9 Eq.671. Thus, any unauthorized interference with the subsoil, for example, digging for minerals or subterranean activity or the violation of the airspace above the land is trespass.

Note that this maxim cannot be regarded as decisive in modern times when mineral exploitation and Air travel and Satellites are commonplace. Even more than several hundred years ago, it was described as “fanciful” by Bowen L.J in Wandsworth Board of Works v. United Telephone Company Ltd. (1884) 13. 2B Division pg. 904.

The modern attitude as shown by authorities is to ignore the literal interpretation of the maxim.

Thus, it has been held that the rights of an occupier in the airspace above his land extend to only such a height as is necessary for the ordinary use and enjoyments of land and buildings thereon.

Consequently, there was no trespass where the defendant flew his aircraft at a height of several hundred feets above the plaintiff’s house. See the case of Bernstein v. Skyviews & General Ltd. (1977) 3 EWHC QB 1 High Court.

Note however that if an aircraft or anything in it falls to the ground, then there is trespass. See Section 49, Civil Aviation Authority Act Cap C13 LFN 2010. It provides:

Section 49(1) “No action shall lie in respect of trespass or nuisance by reason only of, or of the ordinary incidents of the flight of an aircraft over any property at a height above the ground which is reasonable having regard to wind, weather and all the circumstances of the case.”

Section 49(2): “Where loss or damage is caused to any person or property on land or water by a person
in or an article of person falling from an aircraft while in flight, taking off or landing, then without
prejudice to the case of contributory negligence, damages, in respect of the loss or damages shall be
recoverable without proof of negligence or intention”.

Note further that, it is actionable trespass where a crane when in operation swung over the roof of the plaintiff’s factory at a height of fifty feet. See Woolerton Ltd v. Costain (1979) 1 WLR 411 where the defendant’s signboard projected into airspace above the plaintiff’s shop . See Kelsen v. Imperial Tobacco Co. Ltd (1957) 2 Q.B pg 334.

Possession as a ground for an action of Tort of Trespass to Land

The term “possession” for our own purpose refers to a state of owning or having a thing in one’s hand or powers . We are concerned with de facto possession I.e actual possession.

Possession is seen as form of ownership conferring rights to the thing under possession. Therefore, the law protects even wrongful possession against all except one with the better title to the thing. See the case of Amakor v. Obiefuna Supra . In Owe v. Osinbanjo (1965) All NLR pg 72 at 76 , Coker JSC said as follows:

“Once the plaintiff can establish his possession, even if he be a trespasser, the defendant can only
justify his entry on the land by showing a better title”.

See the case of Adeshoye v. Shiwoniku (1952) 14 WACA pg 86. See also Oguehe v. Iliyasu (1971) NNLR pg 157. In that case, the plaintiff, a Native of Kwara State was an employee of the Kano State Ministry of Works. He was in possession of a plot of land in Kano State on which he constructed a house. The land was granted to him by the owner in breach of the Land Tenure Act 1962, Section 27 and 32 of which provided to the effect that Land may not be alienated to a “non native” without the consent of the Commissioner of Lands and that any such alienation without consent shall be null and void.

The defendant, suspecting that the plaintiff had used some Ministry of Works material and labour on the house, purported to act on behalf of the Ministry, caused a bulldozer operator to enter the plaintiff’s land and demolish the house. It was held that the plaintiff had a good cause of action to trespass because:

“… it is bare, de facto, physical possession or occupation which entitles a person to bring an action for

Note that the burden is on the plaintiff to prove that he was in de facto possession of the land at the
relevant time. See Wuta- Ofei v. Danquah (1961) 3 All E.R.596.

Note further that where both the Plaintiff and defendant claim to be in possession of land, the Court will resolve the doubt in favour of the one who can prove title to the land I.e. the one who has “the right to possess”. See Efarrah v. Adekunle (1962) 5 ENLR 55 p. 57, Awoyoolu v. Aro (2006) 1 JNSC 147 at 170, Yussuf v. Abina (1968) 2 All NLR.

In Jones v. Chapman (1848) 154 E.R 777 at p.724, Maule J. observed that:

“If there are two persons in a field each asserting that the field is his, and each doing something in
assertion of the rights of possession, and if the question is, which of those two is in actual possession, I
answer, the person who has the title is in actual possession and the other is a trespasser”.

In Efana v. Adekunle Supra, Idigbe J. said:

“If there is a dispute as to which of two persons is in possession, the presumption of law is that the
person having title to the land is in possession”.

See Amayo v. Erinwingboro (2006) 5 JNSC pt 19, pg 421

It should be noted that if a plaintiff has a right to immediate possession of the land, he can, once he enters unto the land, sue for trespass committed by third parties between the date of accrual of his rights and his entry. Thus is often called Trespass by Relation.

For example, a lessor who has a right to reenter after the termination of the lease, may, after re entry, sue in respect of any trespass committed between the time the lease determined or expired and his re entry. See the case of Barnett v. Guildford (1855) 156 ER 728.

Note further that it is a defence to an action for trespass that the defendant has a right to possession of the land, or acted under authority of the person having such right ( jus tertii ). See Oguehe v. Iliyasu Supra . However, jus tertii will not avail a defendant against the plaintiff who is in de facto possession unless the defendant entered under the authority or as the agent of such third party (owner). See Lajide v. Oyelaran (1973) 3. WSCA 93 at 95.

Trespass ab initio

Where the defendant’s entry is by authority of law as opposed to the plaintiff’s authority, and the defendant subsequently abuses that right, then he becomes a trespasser ab initio (from moment of entry). See The Six Carpenters’ Case (1610) 77 ER 695.

In that case, the defendant entered a tavern, a public place by virtue of the nature of its business and signboard outside which is an invitation to the public to treat. They ate and drank and paid for the first service and after consuming the food and drink for the second service, they refused to pay and the proprietor sued to recover damages.

The court held that the carpenters, having entered the premises on invitation extended by the proprietor to the public were not trespassers from the beginning. The court held that:

“Where an entry, authority or licence is given to anyone in law and he abuses it, he shall be a trespasser ab initio; but not where the authority or license is given by the party.”

Note that, while the modern application now lies in the use of the Police Search Warrants, it has now been removed by cases such as Elias (1934) 2 KB 164 which held that:

“Partial abuse of authority does not rend everything done under it unlawful”.

In Chick Fashions West Wales Ltd v. Jones (1968) 1899, while searching the Plaintiff’s premises for the goods, the Police seized goods which they mistakenly thought to be stolen, the seizure was held to be lawful as Police entering premises with a warrant had authority to remove anything which they believe to have been stolen.

Remedies available in Trespass to Land

A plaintiff in trespass normally sues for Damages and injunction to restrain the trespasser. Damages and injunctions are judicial remedies in the Court of Law. (There are two types of Remedies: Judicial and Extra judicial).

The possessor of land may also avail himself of certain extrajudicial reliefs, recognized under the common law. These include: Forcible ejectment and distress damage feasant, which usually come in the nature of self help.

  1. DAMAGES: Recall that trespass to land is actionable per se (need no proof). Where the plaintiff has suffered special damage by reason of the trespass, he has to specifically plead and prove such additional damage and it must be part of his or her pleadings.
  2. INJUNCTIVE RELIEF (INJUNCTION): An Injunction is an equitable remedy which is not available as a matter of course. The court has to weigh the equity in the case to decide whether to exercise its discretion in favour of the plaintiff applicant or not. Where a plaintiff applies for an injunction, he must precisely spell out the area to be covered by the injunction sought. The injunction granted or sought may be for a temporary duration or perpetual.
  3. FORCIBLE EJECTMENT: The possessor of land may use reasonable force to eject a trespasser who has entered the land forcibly or refused to leave when requested. What amounts to reasonable force depends on the circumstances of each case and the amount of force employed by the trespasser to gain his entrance. It is submitted that self help is a dangerous and inadvisable remedy due to its attendant disadvantages.
  4. DISTRESS DAMAGE FEASANT: The occupier of land at common law has the right to detain trespassing animal as well as other chattels which did damage in the land. Note that, before resorting to this extra judicial remedy, the following conditions must be followed:
  • The thing that caused the damage must be unattended when detained. For example, a cow which enters your land and eats your crops cannot be destrained if the driver is present.
  • The destrainor must not sell the thing destrained, instead he must take proper care of the chattel/thing.
  • There is is no retroactive power to destrain a trespassing chattel for damage done on the previous occasion.
  • There is a destrainor has to release the chattel when its owner has paid proper compensation I.e to say compensation ends restraint. The self help of Distress Damage feasant is an alternative to an action for damages.
  • Only the particular chattel which did the damage could be seized.

Note that Section 7(1) of the Animals Act (1971) has abolished the rights to seize any animal by way of distress damage feasant.

Defences to Trespass to Land

  1. Licenses: A license is the consent which does not pass any interest in the property to which it relates but merely prevents an act which it is given from being unlawful. See Hill v. Tupper (1863) 159 ER pg. 51. An owner who permits another to enter into his land cannot sue that person for trespass. See Adebajo v. Brown (1990) 3 NWLR pt. 144 pg. 661.
  2. Laches: This can be referred to as Slackness or unreasonable delay in asserting and enforcing a right which is lost after the time limited by law to enforce it.

    For a successful plea of laches, the plaintiff must have knowledge of all the facts, giving him a course of action. He must have delayed in instituting an action for so Long a period so that it can be inferred that he did not exercise his right.

    Note that where there is no statutory prescription, period to be considered long will depend on the circumstances of each case. In the case of Manko v. Bonso , it was held that a delay of twenty two years was too long. The plaintiffs knew about the voidable sale of a family land sold in 1885 and they got to know in 1914 and brought an action in 1936.
  3. Acquiescence: This roughly indicates assent to or encouragement and permission on the part of the plaintiff. Acquiescence shares similar elements in common with laches but they are not similar. In the case of Duke of Leeds v. Earl of Amherst (1846) 2 Chancery 117 at 128. The true nature of acquiescence is given as follows:

    “If a party having a right, stands by and sees another dealing with the property in a manner inconsistent with that right and makes no objection, while the act is in progress, he cannot after wards complain. That is the proper sense of the word.”

    Acquiescence shares the two elements of laches but it has four elements namely:

    A. A mistake in the part of the defendant that he is the owner.
    B. The expenditure of money by the defendant on the land to the knowledge of the plaintiff.
    C. The exercise of acts of ownership by the defendant to the knowledge of the plaintiff.
    D. Conducts of the plaintiff showing the abandonment of his rights.
  4. Justification (By law): When justification is provided by law, acts which would otherwise be trespass are not trespass. For example, powers of the police under the Police Act or Evidence Act to enter into the premises to search them.
  5. Necessity: The House of Lords in the case of Re. F (1990) 2 AC pg 1 74 identified three standard situations where the defence of necessity might apply:

    * Cases of public necessity. For example, the destruction of property to prevent the spread of fire.
    * Case of private necessity. In Cope v Sharpe (1912) 1 KB 496. X’s land caught fire, his servants attempted to put out the fire. Z’s gatekeeper set fire to land between the fire and some of Z’s nesting pheasants. In an action for trespass, Z’s gatekeeper was held not liable as there was a real and imminent danger and he had done what is reasonably necessary.

    An action taken as a matter of necessity to come to the aid of another person whose property or person is in imminent danger and it is not practicable to communicate with the assisted person. The action must be such as a reasonable person would take acting in the best interest of the assisted person.

    Note the necessity is a defence to trespass to land, it may not be a defence to another Tort such as
  6. Jus Tertii: This is a claim by the trespasser that he has the authority of a third party who has a better title
    to enter the land.

Lecture(s) – Dr Alayinde | Faculty of Law, Obafemi Awolowo University, Ile-Ife.

Contributor: Abass Olayinka

Law of Tort: Definition, Functions, Relationship, Classifications

N.B. This article is particular to Nigeria.

Law of Tort

Law of tort deals with civil wrongs. The whole essence of the law of torts is founded in the law of negligence . A tort can therefore be referred to as “a civil wrong punishable by damages“. Tort is a civil wrong and a branch of civil law.

Salmond defines tort as:

“a civil wrong for which the remedy is a common law action for unliquidated damages and which is
not exclusively the breach of a contract or a breach of trust or other merely equitable obligation.”

On the other hand, Kodilinye & Aluko defined tort as:

“a civil wrong involving a breach of duty fixed by law, such duty being owed to persons generally and
its breach being redressable primarily in an action for damages.”

In criminal law, the plaintiff is always the state and the defendant, if found guilty of a particular crime, is punished by the state unlike in the law of torts which is civil in nature and is typically between private parties , in some instances however government can sue and be sued.

In law of torts the plaintiff is the victim of an alleged wrong and the unsuccessful defendant is either directed to pay damages to the plaintiff or to desist from the wrongful activity [ injunction] . Examples include intentional tort like battery, defamation, invasion of privacy and unintentional torts such as negligence.

The touchstone of tort liability is negligence; if the injured party can??? prove that the person believed to have caused the injury acted with negligence, at the very least tort law will compensate him. The Law of torts recognises intentional torts and strict liability which apply to defendants who engage in certain actions.

Strict liability can either be contractual or tortious. When contractual, the remedy is damages but when tortious, it is a crime.

In tort law, injury is defined broadly. Injury does not just mean a physical injury but such injury reflect any invasion of individual interest.

Functions of the Law of Tort

In addition to the primary task of tort law to define the circumstances in which a person whose interest has being injured or harmed may seek compensation tort actions can sometimes be used as an alternative to the law of contract (where a person has relied on a promise for example to do some form of work carefully) or to supplement the law of contract.

Tort law may also be used as a vehicle for determining rights. Disputed possession of land may be tested through an action for trespass. Misappropriation of chattels may be dealt with through the tort of conversion which is primarily concerned with questions of title, although the ultimate remedy is to compensate the owner for his loss. Important questions of civil liberty may be tested by an action for nominal damages. For example, the right to vote, trespass to person, trespass to land or trespass to chattel.

Relationship Between Law of Tort and other Courses

  1. Tort and Crime:
    There is some overlap between tort and crime. For example, in most common law countries, an assault is both a crime and a tort (a form of trespass to the person). A tort allows the victim to obtain a remedy that serves their own purposes . For example, payment of damages to a person injured in a car accident or the obtaining of an injunctive relief to stop a person interfering with their business.

    Criminal actions on the other hand are pursued not to obtain a remedy to assist the person although quite often, criminal courts do have power to grant such remedies but they would rather remove their liberty on the state’s behalf. That explains why incarceration is usually available as a penalty for serious crimes but not in tort. The more the severity of the penalty in criminal law means that it requires a higher burden of proof than in tort law.
  2. Torts and Insurance:
    Misfortune happens and when it does, its victims incur costs. Those costs can remain the burden of the victim or they can be shifted to others. Sometimes, the costs are borne by everyone within a particular group or a political community. At other times, the costs are borne by particular individuals namely those who are responsible for having caused them. Tort law and Insurance are thus connected in the following ways:

    Tort Law establishes conditions under which victims can shift at least some of the cost they incur to others . All individuals realise that they may be subject to a judgement against them in Tort and so many buy third party insurance to protect them from bearing the full cost of those judgements. In some jurisdictions, third party insurance is mandatory.

    All individuals are likewise aware that they may be victims of another person’s actions and may not be able to secure a favorable judgement against their injurers, or they may not deem it worth the effort to pursue interest through the court, so many of them buy first party insurance to guard against some of the costs they should otherwise have to shoulder completely. It must however be noted that tort law provides an avenue of redress, not a guarantee of recovery .

    The victim must determine whether pursuing a remedy through Torts is worth the effort and the cost. Where the victim chooses the form of redress, provided by Tort Law, he is given the opportunity to shift his losses to another provided the conditions the law set out for doing so have been met . These conditions set out is what we call liability rules.
  3. Tort law and contract:
    Tortious duties exist by virtue of the law itself and are not dependent upon the agreement or consent of the persons subjected to them . Tortious liabilities could therefore be distinguished from contractual liabilities and from liabilities on bailment, neither of which can exist independently of the parties or at least the defendant’s agreement or consent.

    The interests and liabilities in contract are restricted to prior agreements between the parties and the damages are liquidated . Whereas interests and liabilities in tort are based on the common law and related statutory provisions and the damages are much more responsive to the injury or harm suffered in a particular case.

Categories or Classification of Torts

Tort law may be classified in a number of ways:

  1. Negligence tort.
  2. Intentional tort.
  3. Statutory tort.
  4. Economic tort.

They can also be classified according to the type of rights or interest they aim to protect or preserve.
Concerning the interests protected or defended, tort law may be classified as:

  1. Tort protecting personal interests e.g trespass to land or person.
  2. Tort protecting integrity of the judicial process e.g. malicious prosecution.
  3. Tort protecting personal reputation e.g defamation
  4. Tort protecting economic interests such as injurious falsehood, deceit
  5. Tort protecting relationship and property interests.
  6. Tort protecting other interests.
  1. Negligence torts:
    The dominant action in tort is negligence. It is so because it is not only a tort in its own right, it is also a way by which many torts may be committed. Negligence is a tort which depends on the existence of a breach of duty of care owed by one person to another. A popular case in negligence is Donoghue v Stevenson [1932] AC 562
  2. Intentional Torts:
    Intentional Torts are any intentional acts that are reasonably foreseeable to cause harm to an individual and the doing of that intentional act. Intentional Torts have several subcategories including Torts against the person (assault and battery), false imprisonment, intentional infliction of emotional distress, nuisance and fraud.
  3. Statutory Tort:
    A statutory Tort is like any other in that it imposes duties on private or public parties.

    However, they are created by the legislature and not the courts . Example is the law of consumer protection with product liability in the European Union which informs making defective products that injure or harm people, paying the damages resulting thereof. (Strict liability is statutory. See Grant v. Australian Knitting Mills [ 1935] All ER Rep 209.)
  4. Economic Tort:
    (Designed to help people in business in order not to run out of business.)
    Economic Torts protect people from interference with their trade or business. Torts under this are passing off and Deceit.

Lecture – Dr Adeleke, Faculty of Law, Obafemi Awolowo University, Ile-Ife.

Contributor: Abass Olayinka

Transfer of Property (Commercial Law) NG

N.B. This article is particular to Nigeria.

Transfer of Property

It is important in all contract of sale to know the nature of goods that from the subject matter of sale. This will enable us to determine the point in time that the property in the goods lie at any point in time is important because the liability of the seller or buyer will depend largely bon whether or not the property has passed at the time of the loss. Section 16-20 (Sales of Goods Act, 1893) deals with the transfer of property in the goods to the buyer under a contract of sale.

The rules governing the passing of property depends primarily on whether the good are specific or unascertained. The basic rules can be considered under those two headings:


By S.16 where there is a contract for sale of unascertained goods, no property in the goods is transferred to the buyer unless and until the goods are ascertained. Thus, the property will not pass until the goods have been earmarked or appropriated to the contract with the consent of both parties. In laurie & morewood V John Dudin & sons, a contract for the sale of some maize from the defendant’s warehouse was held not to be the sale of unascertained goods.
The question that would arise is what is ascertained goods?
Section 18 rules 5 (1) puts it thus: subject to contrary intention of a sale of unascertained or future goods by description, where goods of that description in a deliverable in a deliverable state are unconditionally appropriated to the contract.


The second basic rule concerns specific or unascertained goods and is contained in S.17 which provides as follows

  1. Where there is a contract for the sale of specific or ascertained goods, the property in them is transferred to the buyer.
  2. For the purpose of the intention of the parties, regards shall be had to the terms of the contract. The conduct of the parties and the circumstances of the case.

    The key word in this section is “intention”. The intention of the parties as to when the property shall pass can be easily determined when there is a term in the contract stating when this should happen.


From the opening word of section 18, it is clear that these rules will only apply when no different intention is shown by the parties. It says that unless a different intention appears the following are the rules for ascertaining the intention of the parties.

5 rules follow these opening words. The first four rules deal with specific rules, while the fifth deals with unascertained goods.

i. RULE 1: Specific goods in a deliverable state: where there is an unconditional contract for the sale of specific goods in deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment be postponed. The essential element are that
a. Contract must be unconditional
b. Goods must be specific, that is not unascertained or future goods as seen in kursell v. timber.
c. Goods must be in a deliverable state.

ii. RULE 2: specific goods must be put in a deliverable state: where there is a sale of specific goods and the seller is bound to do something to the goods for the purpose of putting them in a deliverable state, the property does not pass until such things be done and the buyer has notice thereof. It is therefore essential that the buyer is notified once the goods have been put in a deliverable state.

iii. RULE 3: specific goods to be weighed measured and tested: where there is contract for the sale of specific goods in a deliverable state, but the seller is bound to weigh, measure, test or do some other act or thing with reference to the goods for the purpose of ascertaining the price. The property does not pass until such act or thing be done and the buyer has notice thereof. This rule is only applicable where the seller is to do something. This was illustrated in boro v. kenedy

iv. RULE 4: approval, sale or return: when goods are delivered to a buyer on approval or on sale or returns or other similar terms the property therein passes to the buyer.
a. When he signifies his approval or acceptance to the seller
b. If he fails to signify his acceptance or approval but retains the goods without giving notice of rejection

Where the buyer does not intend to buy the goods, he must not retain them beyond a reasonable time. In poole v. smith car sale (balham) ltd. It was held that a car had been retained beyond a reasonable time & therefore t3e buyer were liable to pay. The buyer has been responsible for retaining the goods beyond a reasonable time as seen in re ferrie case

v. RULE 5: unconditional appropriation: this deal with unascertained goods and provide that
a. Where there is a contract for the sale of unascertained or future goods… and the goods in a deliverable state are unconditionally appropriated to the contract, the property thereon passes to the buyer.
b. Where in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier, he is deemed to have unconditionally appropriated the goods to the contract.

This rule must be read along with s.16 which says that property in unascertained goods will not pass until they have been ascertained. RULE 5(1) says that when there is a sale of unascertained goods in a deliverable state, property will not only pass when the goods have been unconditionally appropriated to the contract.

To constitute an appropriation of the goods to the contract, the parties must have attached the contract irrevocably to those goods. Assent to appropriation may come before and after the appropriation and may be express or implied.

Contributed by: Abdulganiyu Ismail (AKA) Mastermind
Prepared and Written by: Ucheakonam Chijioke Joshua (CJ)

Transfer of Title (Commercial Law) NG

N.B. This article is particular to Nigeria.

Transfer of Title

Want to learn about transfer of title in commercial law? Continue reading below.

The effect of a contract of sale as regards transfer of title may be broadly divide into three main groups:

  1. The seller would be transferring a valid title
  2. If the property in the goods is not transferred immediately, it would be transferred at some stage of the contract
  3. The person on whom the risk of loss is with is known at all times and the effect on both parties


The general rule is that a person cannot transfer a better title than he has himself. In simple language, you cannot transfer what you do not have. This principle has been summed up in the Latin maxim “nemo dat quod non habet”. However, the rule is that a buyer cannot acquire a better title than that which the seller has. This basic rule has been embodied in section 21(1).

Strict adherence to the basic rule would protect & preserve property so that no one can give a better title than himself has despite the rule, however, it must be emphasied that the sellers either fraudulently allowed innocent third parties to deal with such seller in respect of those goods for value.

Lord denning elucidated this in the case of bishopgates motor finance corp v. transport blakes ltd. This principle was also illustrated in the classical case of Hollins v. fowler. It must further be noted that s.21 of the sale of goods act, provides that a seller is under a duty to transfer a good title to the purchaser and failure to do so would lead to a breach. For a third party to succeed against the original owner, he must show the following:

i. He had taken the goods in good faith and for value
ii. He had no knowledge or notice that anyone else had a better title than the person form whom he was purchasing the goods.


  1. AGENCY: the very wordings of s.21(1) provides for this exception i.e where a person sells goods under the authority of the owner, he can pass a good title. Such authority may be implied, express, or apparent.
  2. ESTOPPEL: the wording of s.21(1) further adds to this exception when it stated “… unless the owner of the goods is by his conduct precluded from denying the seller’s authority to sell”. Thus, an owner can be estopped from denying the seller’s authority to sell where by his words he represents to the buyer that the person in possession of the property was either the true owner or had authority to sell. Thus, in Henderson & co v. Williams, the real owner was estopped from denying the seller’s right to sell since had been held out to be real owner. Estopped can be divided into various types: these are
    i. Estopped by representation
    ii. Estopped by negligence
  3. MERCHANTILE AGENT: although the SGA makes no specific reference to merchant agents s.21(2)(a) cover it by implication by stating that nothing the act is to affect the provisions of the factors act 1889. S.21(1) of the factors act 1889 provides that “where a merchantile agent is the consent of the owner in possession of goods any sales or pledge made by him when acting in the ordinary course in business… shall be valid as if he were expressly authorized by the owner”.
  4. MARKET OVERT: s.22 of the act provides that where goods are sold in the market overt according to the usage of the market, the buyer acquires a good title to the goods provided he buys them in good faith and without notice of any defect or want of title on the part of the seller. A market overt has been defined as an open, public & legally constituted market where people buy and sell openly as opposed to shop outside the market. This is evident in mbanugo v. UAC of nig.
  5. SALE UNDER VOIDABLE TITLE: s.23 provides that “where the seller has a voidable title thereto, but is title has not been avoided at the time of the sale, the buyer acquires a good title to the goods provided that he buys them in good faith”. Note that this section only applies to voidable title & not void ones. Thus, in philps v. brookes ltd, it was held that the pawn broker had a good title to the ring since the contract between the jeweler was good.

Other exceptions to the basic rule include: seller in possession, buyer in possession & writ of execution.

Contributed by: Abdulganiyu Ismail (AKA) Mastermind
Prepared and Written by: Ucheakonam Chijioke Joshua (CJ)