➥ CASE SUMMARY OF:
Anambra State Housing Development Corporation V. J.C.O. Emekwue (1996) – SC
by “PipAr” Branham-Paul C. Chima.
➥ COURT:
Supreme Court – SC. 282/1989
➥ JUDGEMENT DELIVERED ON:
Tuesday, 16th January, 1996
➥ AREA(S) OF LAW
Implied mortgage;
Payment by installment.
➥ PRINCIPLES OF LAW
⦿ READY BUILT HOUSES TO BE PAID FOR INSTALLMENTALLY ARE MORTGAGES
I will have to state clearly that the statutory corporations, with authority to build houses and sell on terms to people who otherwise would be unable to build on their own, are in someway mortgages to the buyers. But instead of outright loan to the buyer they provide ready built houses to be paid for on certain terms. The terms range according to the laid down policy of each corporation. Some require a certain percentage of the full price to be paid as first deposit and the remainder to be paid in certain instalments. They are in some cases flexible as to time but in most cases spell out when and how to liquidate the full price. All these terms are without prejudice to mortgagor’s right to pay the full price outright; or if he defaults for just a few days or even weeks in a reasonable way he still retains his equity of redemption, i.e. even if the contractual date had passed. Howard V Harris (1683) 1 Vern 190; Spurgeon V Collier (1578) 1 Eden 55; Jennings V Ward (1705) 5 Vern 520. What found its way into our statutes is no more than the historical Common Law Practice of protecting the weak borrowing from the overbearing lender. Once the lender (mortgagee) was adequately protected to recover his money in full plus interest at reasonable time even if somewhat outside the contracted period the mortgagor’s equity of redemption should not be vitiated. What is essentially a mortgage in this case is dressed up as a conveyance with the right to withhold possession from the mortgagor until he liquidated the debt; but should he fail to liquidate by unreasonably defaulting in payment and was in arrears for long the mortgagee’s right of foreclosure should also not be vitiated. — Belgore, JSC.
⦿ UNTIL CONDITION IS FULFILLED, A DEED IS A MERE ESCROW
A transaction executed by a deed does not become effective until it is delivered; and where its effectiveness is made subject to fulfilment of certain condition, the effectiveness will remain in abeyance until the condition is fulfilled, See: Beesly V Hallwood Estates Ltd. (1961) Ch. 105. It is a mere escrow. — Wali, JSC.
⦿ DEED REGISTERED IS NOT EVIDENCE OF DELIVERY
The fact that the Deed of Lease was registered is not evidence of its delivery -see Jules V Ajani (1980) 5 S.C. 96.
⦿ PLEADING IS NO EVIDENCE
Pleading, of course, is no evidence and a case is decided on the admissible evidence adduced before the court-see: Dumbo V Idugboe (1983) 1 SCNLR 29; (1983) 14 NSCC 22.
➥ LEAD JUDGEMENT DELIVERED BY:
Belgore, J.S.C.
➥ APPEARANCES
⦿ FOR THE APPELLANT
⦿ FOR THE RESPONDENT
➥ CASE FACT/HISTORY
On 1st of May 1979, at the respondent’s request, the plaintiff (herein referred to as appellant) made an offer on a house, type C3/03 at the Bridge Head Housing Estate, Onitsha to the respondent. The selling price of the leasehold for ninety-nine years was N40,000.00 (forty thousand naira) to be liquidated by four equal monthly payments within six months of the acceptance of the offer. The annual ground rent was to be determined later, but the allottee (respondent) was to be responsible for the fees attracted by the survey of the plot and the preparation of the documents in respect of the property once 50% of the N40,000.00 selling price was paid.
Thus by 14th of May the respondent had accepted the offer and had made a payment of N 10,000.00 being the first instalment. So by 20th April, 1982, without hearing again from the respondent since his letter of 20th April, 1980, intimating of his having paid a second instalment of N10,000.00, the appellant was advised to apply for the refund of the sum he had paid.
This letter indicates that the practice of the appellant, in accordance with their conditions of allocation, was to execute a deed of title in favour of the allottee on payment of 50% of the price of the house. But the deeds would be retained by the appellant pending completion of the whole payment and other fees; similarly the allottee would not be placed in possession unless full price was paid. That is why Exhibit T (supra) in penultimate paragraph indicated sending a deed of surrender to the respondent to execute, i.e. that Exhibit U, to restore the parties to their former positions. The respondent received the cheque for N20,000.00 as refund, cleared it and kept the proceeds but refused to execute the deed of surrender. Thus he wanted to keep his money and the house as well. That gave rise to the appellant going to Court asking for the following reliefs: Wherefore the plaintiff claims against the defendant as follows: “(a) An order setting aside the Land Instrument dated 23rd March, 1981 and made between the plaintiff of the one part and the defendant of the other part which said instrument is registered as No. 16 at page 16 in Volume 1049 of the Register of Deeds kept at the Lands Registry in the office at Enugu. (b) N500 general damages for breach of agreement.”
The stand of the appellant, all along, was that the property had not been formally transferred to the respondent. All that was done was to sign and seal the deed of assignment but it was never delivered to the respondent. The respondent relied on a letter by the appellant to the respondent and dated 18th February, 1982 asking him to come and collect his title deeds as proof that he had the property already vested in him. The letter, to all intent and purposes was not to derogate from Exhibit G and Exhibit H (supra) that unless full payment was made the property would not be delivered to the respondent. The respondent was not only grossly in arrears but was so for several years. Under normal circumstance, he ought to have completed payment of the full N40,000.00 by 15th November, 1979. By the time the appellant took out the writ on 19th January, 1984, the respondent was almost four years in default and had collected even the N20,000.00 he deposited.
Learned Senior Advocates appearing for the parties addressed the Court after which the learned trial Judge delivered his considered judgment and concluded: “In the final analysis, I have no doubt in my mind that the plaintiff has not proved his case against the defendant. The plaintiff’s claim is hereby dismissed.” Dissatisfied with the judgment of the trial court the plaintiff appealed against it to the Court of Appeal, Enugu Division. The plaintiff’s appeal was dismissed. The Plaintiff has further appealed.
➥ ISSUE(S) & RESOLUTION(S)
[APPEAL ALLOWED]
A. THAT THE RESPONDENT FAILED TO PAY THE FULL PRICE WITHIN TIME
“The purport of registering the Exhibit O and Exhibit O 1 is fully explained in the Exhibit G and subsequent correspondence by the parties. It was clear that the respondent would never be let into possession unless he paid the full price. The time to pay the full price is six months – up to now the respondent has not fulfilled his main obligation to pay the full price; his bluff to sue never materialized up to the time of the judgments in the Courts below. The execution of Exhibits O and O1 should not be given a wider meaning than is justified by the circumstances of this case – they were merely to assure the respondent that he would be let into possession on payment of full price, and the execution was the practice after payment of 50% of the purchase price.”
“In the present case the agreement between the parties could be discerned from the contents of Exhibits G and H. it influenced the execution of Exhibits O and Ol. The deeds were signed, sealed but not delivered. Non-delivery was due to failure of the respondent to fulfil a fundamental condition to pay the full price within the time stipulated. See: Awojugbagbe Light Industries Ltd. V Chinukwe & Anor (1995) 4 NWLR (Pt. 390) 379. There is nowhere throughout the hearing of this case that the respondent ever denied not fulfi ling the fundamental condition of the contract. He accepted an offer of a sublease, part paid and went to sleep. He was never let into possession and he could not sue for trespass despite his bluff to sue. Okubule V Oyagbola (1990) 4 NWLR (Pt. 147) 723, 742. Had the Court of Appeal adverted to doing substantial justice without resorting to technicalities (which in this case were even unproved) the result would have been that the plaintiff was entitled to relief sought against the respondent. Adimora V Aiufo (1988) 3 NWLR (Pt.80) 1; (1988) 6 SCNJ 18. The original contract from Exhibits G and H was subject to a fundamental condition thus making the existence of Exhibits O and O1 executory on payment of full price whereby they would be delivered and the respondent then would be let into possession. The conduct of the respondent certainly manifested dilatoriness and would seem to attempt withholding fulfilling his obligation indefinitely whereas time was very important. He collected what he had paid in part fulfilment of the contract and still insisted the contract remained operative; this was unconscionable of him.”
B. THAT THE RESPONDENT FAILED TO TAKE ADVANTAGE OF HIS EQUITY OF REDEMPTION
“In fact, registration of deeds – Exhibits O and O1 – without delivery of the property to the respondent is to make sure the borrower (in this case indirectly the respondent) is assured he would have the house delivered up to him. That is why the period of payment is six months and the registration of the deeds is done after the payment of 50% of the price within the same period but without delivery because the full price had not been paid. As the appellant willingly extended the period of final payment on constant default by the respondent opportunity was on the respondent’s side to have his equity of redemption exercised. He never did and what the appellant actually did was magnanimous in sending the respondent N20,000.00 he had so far paid, which he gladly kept. In that case the appellant could foreclose, which it did in another guise.”
“It must be emphasised that the rule always is based on unconscionability. Is it unconscionable of the appellant to withhold delivery to the respondent in view of dilatoriness of the respondent despite reminders and warnings to pay up what was due in six months after Exhibit H was written by him accepting Exhibit G? The respondent, three years after Exhibits G and H defaulted in paying up, he was even glad, so it seems despite his bluff that he would sue, to receive back the N20,000.00 refunded to him by the appellant.”
.
.
.
✓ DECISION:
“There is great merit in this appeal and I allow it for the foregoing reasons in setti ng aside the decision of the Court of Appeal which affirmed the decision of the trial court. I therefore set aside the sublease now in issue; and the registration in Land Instrument of 23rd March, 1981 is hereby set aside and the entry in respect thereof in No. 16 at page 16 in Vol. 1049 of Register of Deeds Kept at Lands Registry Enugu is ordered to be removed. The award of damages is not proved and it is not hereby made. I award N 1,000.00 as costs in this Court N500,00 as costs in the Court of Appeal and the costs awarded by the trial High Court is hereby reversed as costs to be paid by the respondent to the appellant.”
➥ MISCELLANEOUS POINTS
➥ REFERENCED (STATUTE)
➥ REFERENCED (CASE)
➥ REFERENCED (OTHERS)
