New Nigeria Bank Ltd. V. J. A. Edoma & Ors (2000)

LawGlobal-Hub Lead Judgment Report

BA’ABA, J.C.A.

This is an appeal against the judgment of the Bendel State High Court sitting in Benin Judicial Division delivered on 23/3/89 in suit No.B/22/87. The 1st respondent who was the plaintiff before the trial court claimed against the appellant who was the 2nd defendant in paragraphs 19 and 20 of the amended statement of claim as follows:-

“(i) Whereof the plaintiff claims the said sum of N139,036.78 and interest at the rate of 6% per annum from 20th October, 1981 until the whole debt is paid off.

(ii) The plaintiff can pay the amount claimed plus interest and costs.”

Pleadings were ordered, amended and exchanged by parties. The parties called no witness but their counsel consented to admit all documents presented by the plaintiff/1st respondent. Thereafter, counsel addressed the court.

The learned trial Judge, E. Akpomudjere, J. delivered judgment on the 23rd day of March, 1989 and inter alia held:

“I am satisfied that the plaintiff has proved his case against the defendants as required by law and judgment is entered in its favour against the defendants jointly and severally for the sum of N139,036.78 with costs of N350,00.”

The facts of this case are simple and not in dispute between the parties, is as follows:-

The plaintiff, Onward Paper Mill Limited, is a major exercise and notebooks manufacturing company. The 1st defendant, J. A. Edoma, (Trading under the name and style of Green Sanders & Co. Nig.) secured a contract to supply notebooks and exercise books to the Bendel State Government. The plaintiff who is the 1st respondent in this appeal, demanded for an assurance of payment before supplying the 1st defendant with any notebook or exercise book in a letter dated 25/2/81 admitted in evidence as Exhibit “C1”. The 1st defendant thereafter secured an assurance or undertaking to pay the plaintiff through a letter from the New Nigeria Bank Limited, the 2nd defendant/appellant by a letter dated 6th August, 1981 admitted in evidence as Exhibit “C”. The plaintiff thereafter, supplied the said books to the Bendel State Government which duly accepted them. The Managers of the 1st defendant signed C2 and a letter dated 28th May, 1981, also admitted as Exhibit “C3”. The outstanding sum of N139,036.78 was owed by all the defendants to the plaintiff hence the institution of this appeal. Aggrieved by the decision, the 2nd defendant/appellant appealed to this court by a notice of appeal filed on 13/4/89 containing two grounds of appeal which read as follows:-

(i) The learned trial Judge erred in law when he held that the documents exhibits C2 and C3 constituted a guarantee by the 2nd defendant/appellant in the event of the failure of 1st defendant to pay same.

(ii) The judgment is against the weight of evidence.

When the appeal came up for hearing on 17/2/2000, all the three counsel representing the parties adopted and relied on their respective briefs of argument. From the two grounds of appeal, the appellant formulated the following issues for determination.

(a) Does the letter Exhibit C2 constitute a guarantee in strictu sensu between the appellant and the respondent when it was not made under seals?

(b) If the answer to issue No. 1 above is YES, then is the appellant’s honouring of the letter not based upon the happening of an event to wit: the receipt of payment from Bendel State Government by the appellant into 1st defendant’s account with the appellant?