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Union Beverages Ltd V. M.a. Owolabi (1988) LLJR-SC

Union Beverages Ltd V. M.a. Owolabi (1988)

LawGlobal-Hub Lead Judgment Report

G. O. AGBAJE, J.S.C. 

This appeal came on for hearing on 2nd November 1987, after going through the briefs of argument of counsel for both sides and after listening to the arguments of counsel in open court I allowed the appeal summarily. I reserved my reasons for doing so till today. I now give the reasons.

The case now before us on appeal originated in the High Court of Justice, Oyo State in the Ibadan Judicial Division holden at Ibadan. There the plaintiff one M.A. Owolabi sued the defendant Company, Union Beverages Ltd. Because of the points arising for determination in this appeal, it is necessary to state in full the Plaintiff’s claim in that court against the defendant Since the statement of claim supercedes the writ of summons, the plaintiff’s claim will be taken as contained in paragraph 34 of the plaintiff’s amended Statement of Claim which reads as follows:

(a)”Declaration that the purported termination of the plaintiff’s appointment as Sales Manager by the defendants vide letter No. UBL/GM/PF/79 of 12th April 1979 is wrongful in that it is contrary to the conditions of the plaintiff’s employment and the rules of natural justice.

(b) Damages of N60, 970 for the wrongful termination of the plaintiff’s appointment as Sales Manager in the defendant’s Employment.”

Particulars of the claim for damages were given at paragraph 25 of the Same statement of claim thus:

“The plaintiff on retirement is entitled to gratuity, pension and other allied benefits from the defendant. PARTICULARS

Salary for 7 years N49,000.00

Leave Allowance for 7 years N 1,470.00

House Allowance for 7 years N10,500.00

N60,970.00”

Because of the nature of the points arising for determination in this appeal, it is only necessary for me after setting out the claim as I have just done to refer to the judgment of the trial court, the High Court, presided over by Ige, J., in favour of the plaintiff. The judgment is as follows:

“I hereby declare that the purported termination of the plaintiff from the employment of the defendant by a letter dated 12th April, 1979 was wrongful and in breach of the rules of natural justice and breach of Contract of Service. The defendant shall pay to the plaintiff 3 years salary with yearly increment of N500 per annum with effect from 1/1/79.

The defendant shall also pay the plaintiff his leave entitlement and other benefits such as House Allowance and Pension Allowance as are due to him for these 3 years.”

The defendant, Union Beverages Ltd., being dissatisfied with the judgment of the High Court in favour of the plaintiff, M.A. Owolabi, appealed against it to the Court of Appeal, Ibadan branch. Its appeal to that court was partially successful in that although the Court of Appeal confirmed the judgment of the trial court on the issue of liability yet it reduced the damages which the trial court awarded against the defendant as a result of the breach by the letter of the contract of employment between it and the plaintiff.

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I have set out above the damages, which the trial court awarded against the defendant. The judgment of the Court of Appeal on the issue of damages due to the plaintiff is as follows as contained in the lead judgment of Onu, J.C.A. to which Uche Omo and Sulu Gambari, JJ.C.A agreed:

“Be that as it may, it is my view and in the absence of any evidence as to definite agreement between the parties stipulating period of notice for termination of respondent’s employment, that the measure of damages should be respondent’s remuneration for 6 months allowing for the duration that it would likely take him to find alternative employment – See Swiss Nigerian Wood Industries Ltd. v. Danilo Rogo (supra).”

The above is of course exclusive of two months’ salary ex-gratia payment which appellant voluntarily offered to respondent.

In coming to this conclusion Onu, J.C.A. held as follows:

“I therefore hold the view that the learned trial Judge erred in law in awarding the respondent a yearly salary increment of N500.00 for 3 years when the respondent did not ask for such a relief in his writ of statement of claim. This point is precisely the subject of attack by the appellant in ground 3 and to which learned counsel for respondent, rightly in my view, conceded.”

The defendant is not entirely satisfied with the judgment of the Court of Appeal that is the lower court and its complaint is against that portion of the judgment of the Court of Appeal which awarded the plaintiff 2 months’ salary which was the ex-gratia payment offered the plaintiff by the defendant as contained in Exhibit D, a letter from the defendant to the plaintiff informing him of the termination of the contract of Service between him and the defendant. The relevant portion of Exhibit ‘D’ is as follows:

“I wish to inform you that effective from Tuesday, 16th April, 1979 your services as Sales Manager are no longer required. You will be paid one month’s salary in lieu of notice and an additional two months’ salary ex-gratia upon your handing over to your Plant Manager the Company properties in your possession and liquidating any outstanding loans. Any current and accumulated leave will also be paid.”

Both in his brief of argument and in his oral submissions in open court to us, counsel for the defendant attacked the portion of the judgment of the Court of Appeal against which this appeal is directed and to which I have just referred on the ground that the Court of Appeal in making the said award has given the plaintiff a relief which the plaintiff did not seek in his claim before the court and that the Court of Appeal thereby fell into a serious error.

It is settled law and in fact, the Court of Appeal, the lower court, in its reasons for reducing the damages awarded the plaintiff by the trial court recognised it, that the court is without the power to award to a claimant that which he did not claim. The following authorities cited in the brief of argument of counsel for the appellant namely: Etim Ekpenyong & 3 Ors. v. Inyang Efiong Nyanlyang and 6 Ors. (1975) 2 SC.71 at 81-82; Nigerian Housing Development Society Ltd. & Alhaji AbdulRasaq v. Yaya Mumuni (1977)2 SC.57 at 81; and The University of Lagos & 2 Ors. Vs. Dr. T.O. Dada (1971) 1 U.I.L.R. part III 344 at 349 are just instances of the numerous decisions of this court on the point. There is no need to look for any other authority in this regard. I have set out earlier on in this judgment the claim of the plaintiff against the defendant. I have also set out the particulars of the damages of N60, 970 which the plaintiff was claiming against the defendant. For ease of reference, I reproduce the particulars below:

Salary for 7 years N49, 000.00

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Leave Allowance for 7 years N1, 470.00

House Allowance for 7 years N10, 500.00

N60, 970.00

It is crystal clear that there was no claim by the plaintiff against the defendant for the payment by the latter to the former of the 2 months’ salary ex-gratia payment offered by the defendant to the plaintiff as per Exhibit ‘D’ in the case now before us on appeal. So, having regard to the authorities I have no doubt in my mind that the lower court was wrong in making an order that the said payment should be made by the defendant to the plaintiff.

The conclusion I have just reached is enough to dispose of this appeal in favour of the defendant. But I feel constrained to comment on the arguments in the respondent’s brief of argument and in the oral submissions of counsel for the respondent to us that as a matter of law, barring the technical point that the claim was not formally made, the plaintiff was entitled to the ex-gratia payment of 2 months’ salaries, the plaintiff having handed over the defendant’s properties in his possession in compliance with the request for the same in Exhibit ‘D’. Counsel for the plaintiff appears to have split Exhibit ‘D’ into 3 parts each of which according to him is independent in its scope of operation of the others. The 3 parts will appear to be as follows:

“1. I wish to inform you that effective from Tuesday 16th April, 1979 your Services as Sales Manager are no longer required.

  1. You will be paid one month salary in lieu of notice.
  2. An additional 2 months’ salary ex-gratia upon your handing over to your Plant Manager the Company properties in your possession and liquidating any due outstanding loans.”

To my mind parts 2 and 3 of the Exhibit ‘D’ which I have set out above are contingent upon part one of Exhibit ‘D’ which informs the plaintiff that his services with the defendant are no longer required as from the date indicated therein. It follows therefore in my view that once the plaintiff challenges part 1 of Exhibit ‘D’ which terminates his appointment the plaintiff can no longer take advantage of either of the conditions which the defendant offered for terminating the appointment including the payment of the 2 months’ salaries ex-gratia payment. It is a misconception on the part of counsel for the respondent to take the view that the offer of the ex-gratia payment is independent of the termination of the plaintiff’s appointment by the defendant, and that the offer was made in order that the plaintiff might surrender the defendant’s property in his possession to the latter. As I have said above the offer of the ex-gratia payment is one of the conditions offered by the defendant to the plaintiff for the termination of the appointment.

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I even fail to see how it can be said that the plaintiff by the mere fact of surrendering the defendant’s property in his possession to the defendant had given any consideration for the ex-gratia payment. Nor could I see how the plaintiff by liquidating the loans due from him to the defendant can say he had given any consideration for the ex-gratia payment. In either case I do not see how the plaintiff can be said to have thereby suffered any detriment or to have given anything of value to the plaintiff.

There is a submission in the respondent’s brief of arguments that the proper procedure the defendant/Appellant should have adopted in the case now before us on appeal was to have counter-claimed for the refund of the ex-gratia payment, the implication then being that the ex-gratia payment had already been paid by the defendant to the plaintiff. If the latter were so, this is all the more reason why an order for the payment of the ex-gratia payment could not have been properly made in favour of the plaintiff by the lower court.

In the result, the appellant’s appeal is allowed. The award of two months’ salaries, the ex-gratia payment of N1, 166.68 in favour of the respondent against the appellant by the lower court, that is the Court of Appeal, Ibadan Judicial Division is hereby set aside by me. In effect the damages awarded by the Court of Appeal, Ibadan Judicial Division, in favour of the respondent are hereby reduced by me from a sum of N5,416.68 to a sum of N4,250.00.

The appellant shall be entitled to the costs of this appeal against the respondent, which I assess at N300. The costs in favour of the respondent in the trial court shall stand. The same thing goes for the costs in favour of the appellant against the respondent in the court below.


SC.219/1985

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