Nigerian cases on Breach of Contract (Rationes)

Nigerian cases on Breach of Contract

Below are rationes decidendi on Breach of Contract from Nigerian cases. Breach of contract connotes that the party in breach acted contrary to the terms of the contract.

What is a Breach of Contract?

DAAR COMMUNICATIONS PLC v. MCKEE (2022) LPELR-57848(CA)

“It has been held that a breach of contract connotes that the party in breach acted contrary to the terms of the contract either by non-performance, or by performing the contract not in accordance with the terms or by a wrongful repudiation of the contract.” – Per HAMMA AKAWU BARKA, JCA (Pp 31 – 32 Paras F – A)

ECOSOLAR INTL LTD & ANOR v. RIVERBANK CAPITAL LTD (2020) LPELR-49594(CA)

“A breach of contract connotes that the party in breach had acted contrary to the terms of the contract either by non-performance or by performing the contract not in accordance with its terms or by a wrongful repudiation of the contract. A party who had performed the contract in consonance with its terms cannot be said to have been in breach thereof.” – Per UGOCHUKWU ANTHONY OGAKWU, JCA

BIMBA AGRO LIVESTOCK COMPANY LIMITED v. LANDMARK UNIVERSITY (2020) 15 NWLR (Pt. 1748) 465 (P. 498, paras. A-C)

The term breach of contract denotes a violation of a contractual obligation, either by failing to perform one’s own promise or by wantonly interfering with another party’s performance of the contract. A breach of contract may be occasioned by non-performance or by repudiation or both. Every breach of contract gives rise to a claim for damages, and may give rise to other remedies. Even if the injured party sustains no pecuniary loss or is unable to show such loss with sufficient certainty, he has, at least, a claim for nominal damages. If a court chooses to ignore a trifling departure, there is no breach and no claim arises.

Effect of Breach of Contract

BEST (NIG) LTD v. BLACKWOOD HODGE NIG LTD & ANOR (2011) LPELR-776(SC)

“Where a party to a contract is in breach of a material term of same, the breach gives the aggrieved party a lee-way or an excuse for non-performance of its own side of the bargain. Such a party is at liberty to treat the contract as extinguished or at an end. See: Yadis (Nig.) Ltd. v. G.N.I.C. Ltd. (2007) 14 NWLR (Pt.1055) 584 at 609.” – Per JOHN AFOLABI FABIYI, JSC (Pp 23 – 23 Paras B – C)

NATIONELE COMPUTER SERVICES LIMITED v. OYO STATE GOVERNMENT & ORS (2019)LCN/13569(CA)

The consequence of a breach of contract is award of damages. Damages for breach of contract are compensation to the Plaintiff for the damage, loss or injury suffered through that damage. The Appellant is therefore entitled to damages for the breach of contract by the Respondents. He is entitled to be placed in the same position as if the contract had been performed.

Difference between Breach of Contract and Breach of Trust

EDUN v. FEDERAL REPUBLIC OF NIGERIA (2019) 13 NWLR (Pt. 1689) 326 (Pp. 351-352, paras. G-B) – Supreme Court

A breach of contract, on one hand, is a violation of a contractual obligation by failing to perform one’s own promise under the contract by repudiation of the contract agreement. A breach of contract may be by non-performance, or by repudiation, or both. Each case gives rise to a civil claim either for damages, or some other remedies including specific performance. A breach of trust, on the other hand, occurs with the trustee’s violation of either the trust terms or the trustee’s fiduciary obligations. In the instant case, the appellants were not charged with the offence of criminal breach of trust which would have attracted a criminal sanction by virtue of section 311 of the Penal Code.

Award of Damages in Breach of contract

BIMBA AGRO LIVESTOCK COMPANY LIMITED v. LANDMARK UNIVERSITY (2020) 15 NWLR (Pt. 1748) 465 – Court of Appeal

Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered arising naturally, that is, according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties at the time they made the contract as the probable result of the breach of it.

In the contemplation of such a loss, there ought not to be claims which are merely speculative or sentimental, unless they are specially provided for by the terms of the contract. It is only in this connection that damages can be properly described as “special” in the conception of contractual awards. Damages normally recoverable are based on the normal and presumed consequences of the breach complained of. Thus, the terms “general” and “special” damages are normally inept in categorisation of damages for the purpose of awards in cases of breach of contract. Apart from damages naturally resulting from the breach, no other form of generaldamages can be contemplated.

Enertech Engr. Ltd. v. Alpha Praxis (Nig.) Ltd. (2015) 5 NWLR (Pt. 1452) 325 – Court of Appeal

The amount of general damages to be paid to a person for breach of contract is the amount it will entail to put the person in the position he would have been if there had not been any breach of contract. In other words, in cases of breach of contract, the aggrieved party is only entitled to recover such part of the loss actually resulting as was, at the time of the contract, reasonably foreseeable as liable to result from the breach. What was at that time reasonably so foreseeable depends on the knowledge then possessed by the parties or, at all events, by the party who later commits breach. Accordingly, the measure of damages in cases of breach of contract is in the terms of the loss which is reasonably within the contemplation of the parties at the time of the contract. In this case, the 1 st respondent paid N2.5 Million to the appellant. So, the moment the appellant defaulted, the 1 st respondent incurred some financial losses.

Remedies for a Breach of Contract

FORTE OIL PLC v. OGUNGBEMILE (2021)LCN/15017(CA)

The law is settled that where there is a breach of contract, the available remedy is in damages, see NWAOLISAH V. NWABUFOH (2011) LPELR-2115 (SC) where the Court held thus:

“In the consideration of remedies for breach of contract, the options open to a party to a valid contract is an action for damages in breach of the contract. Ben-Nelson (Nig.) Ltd. V. Moro Local Government, Kwara State (2006) 8 NWLR pt. 1037, pg. 623.” Per ADEKEYE, J.S.C ( P. 39, paras. D-E ). PER NIMPAR, J.C.A.

IGNATIUS ENWELU v. GIUMEX INVESTMENT LIMITED (2017)LCN/10512(CA)

It is trite that there are two remedies available for breach of contract of sale; one is an order of specific performance and the other, damages for breach of contract. The essence of damages in breach of contract cases is based on restitutio in integrum, that is, the amount of damages to be paid to the party wronged by the breach is the amount of damages necessary to put the party wronged and aggrieved in the position he would have been had there been no breach. – PER HELEN MORONKEJI OGUNWUMIJU, J.C.A.

See also:

– Nigerian cases on assault and battery

– Nigerian cases on Extension of time