hbriefs-logo

Alhaji Jimoh Ajagbe v. Layiwola Idowu (2011)

Start

⦿ CASE SUMMARY OF:

Alhaji Jimoh Ajagbe v. Layiwola Idowu (2011) – SC

by PipAr-RAshid

⦿ LITE HOLDING

The seizure of the vehicle by the seller (i.e. the appellant) was wrong since ownership had passed to the buyer (the respondent) when the contract was entered into by them. That explains the liability of the appellant in this appeal.

⦿AREA OF LAW

– Commercial Law

⦿ TAG(S)

– Hire Purchase.
– Credit sale.

 

⦿ PARTIES

APPELLANT
Alhaji Jimoh Ajagbe

v.

RESPONDENT
Layiwola Idowu

⦿ CITATION

(2011) JELR 57609 (SC)

⦿ COURT

Supreme Court

⦿ LEAD JUDGEMENT DELIVERED BY:

Mukhtar JSC.

⦿ APPEARANCES

* FOR THE APPELLANT

* FOR THE RESPONDENT

AAA

⦿ FACT (as relating to the issues)

The case of the plaintiff is that he bought a Toyota Liteace bus from the defendant on a credit-sale basis at N250,000.00 (two hundred and fifty thousandnaira), for which he made an initial payment of N20,000.00 (twenty thousand naira) as deposit in April 1992, and N2,000.00 (two thousand naira) in June 1992. The plaintiff was to make monthly payments until the whole sum was liquidated and after making a total payment of N39,000.00 (thirty-nine thousand naira) he could not meet up with the monthly payments. Consequently, the defendant forcibly recovered the keys of the vehicle.

When the plaintiff took the sum of N12,000.00 (twelve thousand naira) to the defendant, he was told that the vehicle had already been sold to another person. According to the plaintiff, the sale was irregular, illegal and unlawful.

The case of the defendant is that the plaintiff took on hire a Toyota Liteace bus vehicle under a hire purchase agreement executed in June 1992. The plaintiff made the initial payment of N22,000.00 (twenty-two thousand naira), and he was to make a regular monthly payment of N6,000.00 (six thousand naira) which he failed to meet. On the basis of the agreement there was an outstanding balance of N12,330.00 (twelve thousand, three hundred and thirty thousand naira) as at 8 November 1992 when the plaintiff informed the defendant that the engine of the vehicle had broken down. The defendant proposed repairing the vehicle and thus increasing the monthly payment, but the plaintiff refused. On 10 December 1992, the plaintiff’s friend one Lasisi Liasu returned the vehicle to the defendant on the instruction of the plaintiff, and as at the date there was an outstanding balance of N18,330.00 (eighteen thousand, three hundred and thirty naira) on the payments, for which demand was made vide a solicitor’s letter. The defendant effected repairs on the vehicle at a cost of N10,300.00 (ten thousand, three hundred naira).

The plaintiff’sclaims against the defendant in the High Court of Justice, Osun State, as per the writ of summons are:
1. The return of the Toyota Liteace Bus with registration number OS 68 GA Chassis No. 00194483 which the plaintiff bought on credit from the defendant, but which the defendant unlawfully seized from the plaintiff at Ifon-Osun on 4 December 1992. The sum of N500.00 (five hundred naira) per day for loss of use of the vehicle from 4 December 1992 till the vehicle is returned to the plaintiff. The sum of N50,000 (fifty thousand naira) being general damages for the unlawful seizure of the vehicle.”

In the alternative to claim 1 above, The plaintiff claims “the sum of N300,000.00 (three hundred thousand naira) being the current market value of the Toyota Liteace bus with registration No. OS 68 GA Chassis No. 0019483 which the plaintiff bought on credit from the defendant, but which the defendant unlawfully seized from the plaintiff at Ifon-Osun on 4 December 1992.”

The learned trial Judge found the plaintiff’s case proved and made the following orders in favour of the plaintiff:

(1) The defendant is hereby ordered to pay the plaintiff the sum of N300,000.00 (three hundred thousand naira) being the current market value of the Toyota Liteace bus with registration No. OS68 GA Chassis No. 0019483 which the plaintiff bought on credit from the defendant, but which the defendant unlawfully seized from the plaintiff at Ifon-Osun on 4 A December 1992. The defendant is hereby ordered to pay the plaintiff the sum of N293,000.00 (two hundred and ninety-three thousand naira) being for loss of use of the vehicle from 4 December 1992 at N500.00 (five hundred naira) per day until today 12 July 1994. The sum of N30,000.00 (thirty thousand naira) general damages is warded in favour of the plaintiff against the defendant.”

The defendant was dissatisfied with the decision, so he appealed to the Court of Appeal, Ibadan division, which allowed the appeal, in part.

The defendant has again appealed to this court on four grounds of appeal.

⦿ ISSUE(S)

1. Whether the learned Justices of the Court of Appeal were right in law to have held that there appears to be no consensus in the minds of the parties at the time of the transaction.

2. Whether the learned Justices of the Court of Appeal were right in law when they held exhibit ‘A’ was not a valid hire purchase agreement but that of a credit sale having regard to the evidence.

Available:  Cosm As Ezukwu v. Peter Ukachukwu Jude Ukachukwu (SC. 160/2000, 2 July 2004)

3. Whether the learned justice’s of the Court of Appeal were right in their award of the sum of N250,000 (two hundred and fifty thousand naira) to the respondent as the sale value of the vehicle.

4. Whether the learned Justices of the Court of Appeal were right to award special damages in favour of the respondent which was not predicated on any evidence as required by law.

 

⦿ RESOLUTION OF ISSUE(S)

[APPEAL: ALLOWED, IN PART]

1. ISSUE 1 & 2 WERE RESOLVED IN FAVOUR OF THE RESPONDENT BUT AGAINST THE APPELLANT.

RULING:
i. The above observation confirms that the court had recourse to the evidence before the lower court and at the end found and confirmed the nature of the transaction, as it did in its judgment. There was a proper evaluation of that aspect of the evidence, as it does actually conform with [exhibit] A the transaction of credit sale i.e there was an undisputed payment of deposit, and installmental payments, (which even though the exact amounts were not ascertained) was still by installment. In its judgment, the court below reiterated its finding thus: “I have held above, that the transaction between the defendant/appellant and the plaintiff/respondent is one of a credit sale of the vehicle to the respondent where the title in the vehicle passed to the respondent upon the payment by the respondent of part payment of N22,000.00 (twenty-two thousand naira) out of N250,000.00 (two hundred and fifty thousand naira) which sum the appellant received.”

ii. It was the case of the plaintiff/respondent that the Liteace was seized by the defendant/appellant, whereas, the defendant asserted that it was the respondent who brought the vehicle to him. In paragraph (7) and (8) of his statement of claim, the respondent averred the seizure of the vehicle by the appellant, and the appellant made his own assertion in paragraph (14) of his statement of defence, to wit the plaintiff averred in paragraph (3) of the reply to the statement of defence as follows: “3. The plaintiff denies that he voluntarily released the vehicle to the defendant either by himself or through one and shall at the hearing contend through anyone and shall at the hearing contend that by the defendant’s solicitor’s letter dated 12 December 1992, the defendant is estopped from denying the fact that he seized the vehicle from the plaintiff.” Are the averments supported by credible evidence? It is on record that the plaintiff by his evidence already reproduced supra proved his averments that the vehicle was seized by the appellant, as is corroborated by the content of the appellant’s solicitor’s letter addressed to the respondent dated 10 December 1992, a pertinent excerpt of which reads: “We are further informed that you have damaged the said motor vehicle and yet you refused to pay as a result which the vehicle was seized from you on 10 December 1992.” I think the above, coming from the appellant closes and seals the facts that the liteace bus was actually seized by the appellant, which he had no right to do under the seemingly credit sale transaction which existed between them. That the respondent breached the installmental payment agreement is neither in doubt nor in dispute, but the remedy open to the appellant would have been to sue for the recovery of the balance of the purchase price, and not to go to the extent of seizing and ultimately selling the vehicle: Yakasai v. Incar and Kofi v. Mensah.  In the light of the above discussions, I resolve issues (1) and (2) in favour of the respondents, and dismiss the grounds of appeal which cover them.

3. ISSUE 3 WAS RESOLVED IN FAVOUR OF THE APPELLANT BUT AGAINST THE RESPONDENT.

RULING:
i. The only evidence in respect of the value of the vehicle is that which the plaintiff said was the total cost of the vehicle under cross-examination, and which the defendant said represented the hire purchase price, in the course of cross-examination. As a matter of fact, the plaintiff did not testify in respect of this claim of N300,000.00 (three hundred thousand naira) on special damages, this amount of N250,000.00 (two hundred and fifty thousand naira) only emerged in the course of cross-examination, and this was qualified with the word ‘total’, as can be seen on page 10 of the printed record of proceedings from line 14. When the word total is used in respect of any amount, it signifies that many figures are taken into account before arriving at an amount which is then described as ‘total’. The pertinent question is, were there other costs added to the actual cost of the vehicle that made the total cost N250,000.00? The answer is left blowing in the wind, so to speak. Definitely, the plaintiff did not prove the special damages as an alternative to the return of the Toyota liteace bus. Perhaps if the plaintiff had sought the aid of a car dealer vide his claim. However, the relief for the return of the vehicle still stands. As the grant of the relief is not feasible, (in the light of the evidence before the court that the vehicle had already been sold by the defendant), what was open to the learned trial court was to have evaluated the other pieces of evidence in relation to the age and condition of the vehicle in respect of the issue under discussion. There was the evidence that the respondent was in possession of the vehicle from June 1992 till December 1992, and the evidence that the appellant expended money on the repair of the vehicle, a piece of evidence that was buttressed by the plaintiff’s evidence on the problems the vehicle had before it was seized. I am of the view that the court below should have considered those evidence closely before arriving at the value of the vehicle and the damages to award. In my own appraisal and calculation, the award of N250,000.00 (two hundred and fifty thousand naira) was wrong, as other factors should have been taken into consideration. It was not as though the vehicle had not been used by the plaintiff. Evidence abound that he used it for six months during which the vehicle broke down. The court below therefore erred when it held thus: “The sum pleaded as the value of the vehicle on which evidence is given is N250,000.00(two hundred and fiftythousand naira) which sum I award in lieu of the return to the respondent on the said vehicle.”

Available:  Goodwill & Trust Investment Ltd & Anor vs Witt & Bush Ltd (2011) - SC

ii. In the circumstance of this case and the evidence, I assess the damages to be awarded at N150,000.00 (one hundred and fifty thousand naira). This award will meet the justice of the case. I resolve issue (3) in favour of the appellant, and allow the appeal on the related ground of appeal.

4. ISSUE 4 WAS RESOLVED IN FAVOUR OF THE APPELLANT BUT AGAINST THE RESPONDENT.

RULING:
i. It is manifestly clear from the latter piece of evidence that even repairs of the vehicle and other related matters came from the net income. This aspect of the claim and evidence should have been considered by the courts below. Another important factor the court should have taken into account is the impossibility of the use of the vehicle every blessed day without ceasing for over 18 months. It is possible that if the respondent was in possession of the vehicle, he would have been plying Suleja/Abuja every single day through the week and months, without rest? It is not feasible. There must be days for rest, days for repairs and service of the vehicle, and days for some family and social engagements which will require the attention of the respondent. To do the calculation of the loss of use without adverting to these human vagaries that may occur from time to time, and which may prevent the respondent from earning the said N500.00 (five hundred naira) net income daily is a grave omission. Then, there is this aspect of the amount A the respondent was paying the appellant installmentally for the few months he made the payments. There was the payment of N4,670.00 (four thousand six hundred and seventy naira), N6,000.00 (six thousand naira) and N3,000.00 (three thousand naira) per month. What I find worrisome is, if the respondent was earning N15,000.00 (fifteen thousand naira) net income per month, why should a monthly payment of the above amounts be impossible for him, and why should he be able to pay only a meager N3,000.00 (three thousand naira) in a whole month? I think it is inconceivable that the net income of the respondent was N500.00 (five hundred naira) daily. If the lower courts took all the above factors into account, they would not have accepted the evidence of the respondent, and based their award on it.

⦿ REFERENCED

⦿ SOME PROVISION(S)

The principle of hire purchase contract as contained in Halbury’s Laws of England, 1st Edition, volume 1 page 554 states thus: “The contract of hire-purchase, or even more accurately, the contract of hire with an option to purchase is one under which the owner of a chattel lets it out on hire and undertakes to sell it to or that it shall become the property of the hirer conditionally on his making a certain number of payments. Until the making however of the last payment, no property in the chattel passes. Where the contract between the parties amounts to an absolute agreement to sell and buy, whether the instrument be called a hire purchase agreement or not, the property in the chattel passes upon delivery, provided that such was the intention of the parties… The difference between a contract of sale at a price payable by installment and a contract of hire purchase is that in the former, the purchaser has no option of terminating the contract and returning the chattel, whereas in the latter there is none. In each case, the substance of the transaction or the agreement must be looked at and not the mere words.”

Available:  Osahon Nathaniel Obayuwana & Ors v. Chief John Osamede Adun (2020)

Chitty on Contracts General Principles, volume 1, page 6, paragraph 1004 captured a situation as the one existing in this case and the general concept of agreement in the following words: “Moreover, even though it is true that the existence of an agreement is in the vast majority of cases a condition for the existence of a contract not contained in a deed, this statement ought to be treated with some caution. First, the existence of an agreement is not an issue merely of fact, to be found by a psychological investigation of the parties at the time of its alleged origin. English Law takes an “objective” rather than a “subjective” view of the existence of agreement and so its starting point is the manifestation of mutual assent by two or more persons to one another agreement is not a mental state but an act, and as an act, is a matter of inference from conduct. The parties are to be judged, not by what is in their minds, but by what they have said or written or done.”

⦿ RELEVANT CASE(S)

In the case of Yakassai v. Incar Motors (Nig.) Ltd (1975) 5 SC 107, (1975) NSCC 284 which facts are virtually on all fours with the instant case, (in that the vehicle in controversy was seized by the owner on default of installmental payments after an outright sale), the Supreme Court after a thorough consideration of the facts of the case, the addresses of learned counsel, and the principles enunciated in the case of Kofi v. Mensah 1 WACA 76 pronounced as follows: “We are in no doubt whatsoever that the facts of this case show clearly that the vehicle was sold outright by the defendants to the plaintiff ever before the defendants effected the seizure which is the subject matter of this action. That being so, we think that the respondents in the present case acted wrongly when they seized the vehicle as they did. The difference between an outright sale and a hire purchase agreement is that in the former, the property in the vehicle passes to the purchaser as soon as the contract is entered into, whereas in hire purchase agreement, the property in the vehicle still remain vested in the owner until payment is fully made. In other words, under a hire purchase agreement, it is always open to the owner of a vehicle to take possession of it on failure of the hirer to pay the installments. In an outright sale, the seller’s remedy lies in an action to recover the balance of payment owed by the purchaser.”

AAAA

⦿ CASE(S) RELATED

⦿ NOTABLE DICTA

* PROCEDURAL

A court in evaluating evidence must taken into consideration every little aspect of it, and the surrounding factors. It is not for the Judge to accept evidence hook, line, and sinker without weighing its preponderance and probability. – Mukhtar, JSC. Ajagbe v. Idowu (2011)

The law is settled that civil suits are determined on preponderance of evidence and balance of probability. – Mukhtar, JSC. Ajagbe v. Idowu (2011)

It is also a cardinal principle of law that even though an appellate court will not ordinarily interfere with findings of a lower court, it behoves an appellate court to interfere with the findings where they are not supported by credible evidence, are perverse and may have occasioned miscarriage of justice. – Mukhtar, JSC. Ajagbe v. Idowu (2011)

* SUBSTANTIVE

When the word total is used in respect of any amount, it signifies that many figures are taken into account before arriving at an amount which is then described as ‘total’. – Mukhtar, JSC. Ajagbe v. Idowu (2011)

It is a well grounded principle of law that an appellate court will review an award of damages downwards where it finds it excessive or not in accordance with the principle of law: Stirling Civil Eng. (Nig.) Ltd v. Yahaya (2005) All FWLR (Pt. 263) 628; (2005) 11 NWLR (Pt. 935) 181 ; Otaru and Sons Ltd v. Audu Idris (1999) 6 NWLR (Pt. 606) 330 and Jarmakani Transport Ltd v. Abeke (1963) 1 All NLR 180. – Mukhtar, JSC. Ajagbe v. Idowu (2011)

In a credit sale agreement for the purchase of a vehicle, the buyer, i.e the plaintiff/respondent pays a deposit, followed by installmental payments. Once the agreement is entered into by the parties, ownership of the vehicle is transferred to the buyer. If the buyer defaults or is unable to meet his financial obligations to the seller, the option open to the seller is an action to recover the balance of payment owed by the buyer/purchaser. On the other hand, in a hire purchase agreement, ownership of the vehicle remains with the seller until payment is fully made. Failure of the buyer/hirer to pay the installments, the owner is at liberty to take possession of the vehicle. – Rhodes-Vivour, JSC. Ajagbe v. Idowu (2011)

End

SHARE ON

Email
Facebook
Twitter
LinkedIn
Telegram
WhatsApp

Form has been successfully submitted.

Thanks.

This feature is in work, and currently unavailable.