Mrs. Ibiyemi Oduye V. Nigeria Airways Limited (1987)

LawGlobal-Hub Lead Judgment Report

ESO, J.S.C. 

The Plaintiff, Mrs. Ibiyemi Oduye, is the Appellant in this Court. I will refer to her, hereinafter in this judgment, as the Appellant. The Appellant was a Senior Nursing Sister in the employment of the Respondent – the Nigeria Airways Ltd. Indeed, she rose from the post of Nursing Sister to the post of Senior Nursing Sister, within a few years of her joining the services of the Respondent. It was part of the conditions of her service that she was provided with accommodation -a detached duplex building at No. 15 Ayoade Coker Street, G.R.A., Ikeja. The rent she paid was N25 per month and the arrangement was that the sum was deductible from her salary.

However, by a letter dated 27th December, 1977, the Appellant’s employment with the Respondent was determined, but notwithstanding the termination of her employment, she continued to hold over the premises. While the Appellant sued the Respondent for damages for breach of contract of Service (this is not a matter for this appeal) the Respondent counterclaimed for mesne profits, at the rate of N13.500.00 per annum. It is this claim (or rather counter-claim for mesne profits) that is the subject matter of this appeal.

The Trial Court, Akintola Ejiwumi. J., after stating the facts, and examining the exhibits tendered in the case, and the submissions of learned counsel, held that the appointment of the Appellant was wrongfully terminated. As regards the counter-claim, which is the only pertinent material in this case, the learned trial Judge was of the view that the important question to be considered was whether the amount of N25 per month as rent represented the fair value of the premises. He then referred to the Rent Control and Recovery of Residential Premises Edict of 1976 No. 15, which, according to the Judge put the rent payable in respect of premises of this kind at N13,500 per annum. He found for the Respondent and awarded mesne profits to the Respondent at the rate of N13.500 per annum until the date of the judgment or when possession was delivered, if such delivery of possession occurred before the date of the judgment.

The Appellant appealed to the Court of Appeal, Nnaemeka-Agu, J.C.A., who read the lead judgment of the Court, with which Adenekan Ademola J.C.A. concurred – Kutigi, J.C.A. dissenting – considered as a first point to be decided, whether the tenancy had determined. He held it was an ordinary type of tenancy in consideration of the Appellant’s employment as a Nursing Sister and the tenancy was merely subservient to and necessary for the employment. It was the view of the learned Justice of the Court of Appeal that as the employment had been terminated, the tenancy was also automatically determined. Nnaemeka-Agu, J.C.A. held-

“The first point that must be decided is whether the tenancy had determined. It is necessary to note that this was not an ordinary type of tenancy as between a landlord and a tenant as such. It was a tenancy in consideration or the appellant’s employment as a Nursing Sister, the tenancy being merely subservient to, and necessary for, the said employment. As the employment had been terminated, the tenancy automatically terminated.”

………………………………………….

………………………………………….

“Any person who occupies any premises as a contractual tenant during her employment but that the occupation was subsequent to her employment, under and in accordance with her conditions of service, and that the tenancy determined on the 28th of December, 1977, when her employment was terminated by Exhibit “6”. As the tenancy had terminated there can be no question of his remaining a contractual tenant who must be given a notice to quit.”

For the jurisdiction of the Trial Court to entertain the matter, having regard to the provisions of the Rent Control and Recovery of Residential Premises Edict, 1976 No.9, the learned Justice of the Court of Appeal held-

“Although what the appellant claimed for in the High Court was her loss of salary for fourteen years, her tenancy, was, by the conditions of her service, so inextricably bound up with her services and terminal benefits that it was only fair, convenient, and proper that the claim and counter-claim should be tried together. Indeed the learned counsel for the appellant conceded it that the court had jurisdiction to try the counter-claim if it was at the rate of N300.00 per annum but contended that it had no such jurisdiction for a claim at the rate of N13,500.00.I do not agree. Nor do I see anything in Section 34(1) of the Edict read together with Section 20, which is permissive, to oust the jurisdiction of the High Court from entertaining a counter-claim for mesne profits. I must also observe that neither possession nor rent of a subsisting tenancy was in issue in the counter-claim. What was in issue was the mesne profits – the adequate compensation payable to the respondent on the premises over which the appellant was holding over.”

Now, though the Edict had been abolished in Lagos State since 1st July, 1981 (See Law No.5 of 1981) their jurisdiction had reverted to the conventional courts. The action herein was filed in 1978.

The Court then considered the quantum of the award of mesne profits and held that in a case of this nature, a tenancy which is subservient to an employment “in which parties themselves have agreed in advance on what should be the measure of monetary compensation for the servant’s continued occupation of the premises after the determination of his employment, that agreement should be the correct basis for the measure of mesne profits payable by her.” However, the Court put a ceiling which was the one placed by the Rent Control (Standard and Maximum Rents) Order L.S.L.N. No. 15 of 1976, as at the rate of N13,500 per annum. The order made by the Trial Court was however modified. The Appellant was made liable to pay the agreed rate of N25.00 per month payable for the first three months after the cessation of the employment of the Appellant. Thereafter the Appellant was to pay N13,500 as mesne profits.

It is pertinent to mention at this stage the reasoning in the dis-senting judgment of Kutigi, J.C.A. The learned Justice asked the question-