J.A. Obanor & Co. Ltd. Vs Co-operative Bank Ltd. (1995)

LAWGLOBAL HUB Lead Judgment Report

MOHAMMED, J.S.C.

In this appeal, the appellant, J.A. Obanor and Co. Limited, as plaintiff at the Benin City High Court, filed an action claiming several declarations and an injunction against the respondent. In response, the respondent as the defendant before the trial High Court denied all the claims and filed a counter-claim against the appellant. The plaintiff’s claim as per it’s amended statement of claim is as follows:

“(a) A declaration that the said Mr. J.A. Obanor ceased to be a Director of the plaintiff’s company as from 14th July, 1976, and as such is incompetent to create any obligation for and on behalf of the plaintiff’s company with the defendant or any other company.

(b) A declaration that the plaintiff company limited in liability as a corporate body is not competent to enter into and could not enter into any contract transaction beyond its normal share capital with the defendant company.

(c) A declaration that the signatory, Mr. J.A. Obanor to the purported unstamped mortgage registered at the office of Lands Registry, Benin City, at No. 14 page 14 in Volume 425 between the plaintiff and the defendant was at the time of the purported agreement, incompetent to contract on behalf of the plaintiff company.

(d) A declaration that the Mortgage purportedly made on 26th July 1974, executed by the said J.A. Obanor on behalf of the plaintiff in May, 1977 and upstamped to cover N250,000.00 (Two hundred and fifty thousand naira) and delivered for registration on 23rd May, 1977 and registered at No.14 page 14 in Volume 425 at the Office of the Land Registry, Benin City is false, null, void and of no effect whatsoever and is not binding on the plaintiff.

(e) An order setting aside the said mortgage.

(f) A declaration of the court that the parcel of land situate and lying at No.6 Dawson Road, Benin City on which resides the building of Continental Palace Hotel is the bona-fide property of Messrs J.A. Obanor and Company Limited.

(g) An order of injunction to restrain the defendant, its servants, agents or privies from carrying out or proceeding with the advertised sale of the building of the Continental Palace Hotel, property of J.A. Obanor and Company Limited.”

The respondent, in a counter claim filed together with the statement of defence prayed for an order of the trial High Court for the sale of the lands. And buildings specified as per the particulars set forth hereto and all of which (properties) covered by legal mortgage dated 19th August, 1969 and registered at No. 10 at page10 in volume 69; by legal mortgage dated 20th May, 1977 and registered at No.9 at page 9 in volume 425 and by legal mortgage dated 26th July, 1974 and registered at No. 34 at page 34 in volume 228 and No.14 at page 14 in volume 425 upstamped to cover N250,000.00 in order to harmonise excesses in the authorised overdraft. The appellant has failed to redeem the loans secured and the mortgaged properties are as follows:

“A(i) Land and building situate and lying at No.20 Dawson Street (Sometime known as No.6 Samuel Ogbemudia Street or Dawson Street). Benin City containing an area of 1377.78 square yards and

(ii) Land and building situate and lying at Uwa Street, Benin City containing an area of 3088.90 square yards of which properties were covered by legal mortgage dated 26th July, 1974 and registered as No.34 at page 34 in volume .228 at the Lands Registry, formerly kept at Ibadan but now in Benin City to secure an overdraft/loan of N40,000.00

B(i) Land and buildings situate and lying at ward 7/E New Benin, Benin City. ‘

(ii) Land and buildings situate and lying at Uwa Street, 1st East Circular, Ward 18/H, Benin City.