PABLO AMARAN v. EDUCATION TRUST FUND
CITATION: (2014) LPELR-22859(CA)
In The Court of Appeal
(Abuja Judicial Division)
On Tuesday, the 25th day of March, 2014
Suit No: CA/A/67/2013
Before Their Lordships
ABUBAKAR DATTI YAHAYA
JOSEPH TINE TUR
MOORE A. A. ADUMEIN
Justice, Court of Appeal
Justice, Court of Appeal
Justice, Court of Appeal
Between
PABLO AMARAN
(Carrying out business
under the name and
Appellant
style of Amaran &
Associates)
And
EDUCATION TRUST
FUND
Respondent
RATIO DECIDENDI
1
1 CONTRACT - ACCEPTANCE: Meaning and
nature of an acceptance
"An acceptance is a signal to the offeror,
indicating acceptance of the offer. It must be
such that it is the terms of the offer that have
been accepted and no less. The acceptance
has to be clear, unequivocal without variation.
See U.B.N. VS. OZIGI (1991) 2 NWLR (PT.
176) 677; INNIH vs. FERADO (1990) 5 NWLR
(Pt. 152) 604 and GREEN FINGERS vs. YUSUF
(2003) 12 NWLR (Pt. 835) 488. In the 8th
Edition of Black's Law Dictionary "acceptance"
was defined as "An offeree's assent, either by
express act or by implication from conduct, to
the terms of an offer in a manner authorized
or requested by the offeror, so that a binding
contract is formed." Per YAHAYA, J.C.A. (P.
16, paras. D-G) - read in context
2 CONTRACT
ACCEPTANCE:
constitutes an acceptance
What
"The learned authors have defined what
constitutes "acceptance" at pages 44-45
paragraph 54 as follows: "An acceptance is a
final and unqualified expression of assent to
the terms of an offer. The objective test of
agreement applies to an acceptance no less
than to an offer. On this test, a mere
acknowledgment of an offer would not be an
2
acceptance; nor is there an acceptance where
a person who has received an offer to sell
goods merely replies that it is his "intention to
place an order." Where the offer is made in
alternative terms, the acceptance must make
it clear to which set of terms the assent is
directed. In Peter Lind & Co. Ltd. vs. Mersey
Docks & Harbour Board (1972) 2 Lloyd's Rep.
234 an offer to build a freight terminal was
made by a tender quoting in the alternative a
fixed, and a "cost-plus," price. The offeree
purported to accept "your tender", and it was
held that there was no contract. Negotiations
with a view to contracting may be long and
complicated; and in such cases it may be hard
to tell when (if at all) an offer has been made
and accepted. The Court then has to look at
the whole course of the negotiations and to
determine at what point (if any) the parties
reached agreement. The parties may of course
continue their negotiations after this point has
been reached; but this fact will not affect the
existence of the contract between them unless
the continuing negotiations can be regarded
as an agreement to rescind the original
contract." Per TUR, J.C.A. (Pp. 37-38, paras.
G-G) - read in context
3 CONTRACT - ACCEPTANCE OF AN OFFER:
When will there be acceptance of an offer
3
"The law is clear that where an agreement is
subject to confirmation by a party, who fails to
so confirm it, and he goes ahead to add
further conditions, then the agreement is
reverted to a position of negotiation. It is only
when the new terms are accepted by the
original party offering, that a binding contract
can come to fruition - LAWAL VS. UNION
BANK (SUPRA) at page 31. Similarly, when an
offeror makes an offer, and the offeree adds
conditions or varies the terms of the offer,
there is no acceptance of the offer, and the
offeree now becomes an offeror of the new
terms and negotiations begin again. If the
original offeror accepts the new terms, as
offeree, then a binding contract arises,
otherwise there is no acceptance and there is
no agreement binding on the parties." Per
YAHAYA, J.C.A. (P. 23, paras. A-E) - read in
context
4 EVIDENCE - BURDEN OF PROOF: Whether
he who asserts must prove
"The appellant as the plaintiff, made the
positive assertion, that there is a valid
contract binding it and the respondent, as it
had accepted the offer without variation. The
onus is thus on it, to prove the assertion Section 131 of the Evidence Act 2011 and
VULCAN GASES vs. G.F IND (2001) 9 NWLR
(Pt. 719) 610." Per YAHAYA, J.C.A. (Pp.
4
26-27, paras. G-A) - read in context
5 CONTRACT - CERTAINTY OF TERMS OF A
CONTRACT: Whether the certainty of the
terms of a contract determines the intention
of the parties and whether there is a binding
contract
"In Mandilas & Karaberis Ltd. vs. Otikiti
(1963) 1 All NLR 22 at 26, Bairamian, F. J.,
held that "...When a contract is reduced into
writing, the writing gives the terms agreed
upon." See also Olaniyan & Ors. vs. Unilag
(1985) 2 NWLR (Pt. 9) 599 and A. A.
Macaulay vs. NAL Merchant Bank Ltd. (1990)
6 SCNJ 117 at 133. Before the parties come
to a binding contract they usually enter into
negotiations. It is the certainty of the terms
the parties arrived at that determines their
intention and whether there is a binding
contract. This was made clear in Omega Bank
Nigeria Plc vs. O.B.C. Ltd. (2005) 1 SCNJ 150
at 170 lines 14 to page 171 lines 1-8..." Per
TUR, J.C.A. (Pp. 34-35, paras. F-B) - read in
context
6 CONTRACT - CONSENSUS AD IDEM:
Whether a contract requires the meeting of
the minds of the parties for same to be
binding
5
"The submission of counsel to the appellant at
page 17 of the brief, and relying on YARO vs.
AREWA (2007) 17 NWLR (Pt. 1063) 378
applies when parties have already entered
into an agreement binding on them, and a
new term is sought to be introduced. It does
not apply here, where no agreement had been
reached. Since there was no meeting of the
minds between the appellant and the
respondent i.e. no ad idem there was no
binding contract - OGUNDALU VS. MACJOB
(2006) 7 NWLR (Pt. 978) 148, and
OLOWOFOYEKU vs. A.G. OYO (1990) 2 NWLR
(Pt. 132) 369." Per YAHAYA, J.C.A. (Pp.
25-26, paras. F-B) - read in context
7 CONTRACT - CONTRACTUAL AGREEMENT:
Whether the intention of parties as clearly
expressed in a document will be looked at to
determine whether there was an agreement
or not
"...when parties clearly express their intention
in a document, it is that document that will be
looked at, not other documents that do not
form part of the intention of the parties NNEJI VS. ZAKHEM (2006) 12 NWLR (Pt. 994)
297." Per YAHAYA, J.C.A. (P. 22, paras. D-E) read in context
8 COURT - DUTY OF COURT: Whether the
6
Appellate Court can interfere with the trial
Court's duty to appraise evidence
"A trial court has the pre-eminent duty of
appraising evidence adduced before it and to
ascribe probative value to such evidence. An
appellate court does not interfere with this
duty, unless and until the trial court fails to do
so or properly do so, to such an extent that a
miscarriage of justice has been occasioned,
where the finding is perverse, not supported
by evidence or there was a wrong exercise of
discretion. See KAMOLU VS. UMUNNA (1997)
5 NWLR (Pt. 505) 321; KUFORIJI vs. V.Y.B
LTD (1981) 6 - 7 SC 40; WOLUCHEM vs. GUDI
(1981) 5 SC 291 and AGBAKOBA vs. I.N.E.C
(2008) 18 NWLR (Pt. 1119) 489." Per
YAHAYA, J.C.A. (P. 27, paras. B-E) - read in
context
9 CONTRACT - ELEMENTS OF A CONTRACT:
What are the elements of a contract
"A binding contract that is capable of being
enforced by the court, must possess the
ingredients
of
offer,
acceptance,
consideration, intention to create legal
relations and capacity to contract - OMEGA
BANK VS. O.B.C LTD (2005) 8 NWLR (Pt. 928)
547;
CHIEF
YARO
VS.
AREWA
CONSTRUCTION LTD (SUPRA) and B.F.I.G VS.
B.P.E (SUPRA). Thus, before an agreement
7
can come into existence, there must be an
offer which is precise and certain, which must
be accepted unconditionally. An offer springs
from the offeror to the offeree, for the
purpose of entering into an agreement to do
or refrain from doing a thing. It must be
precise, to enable the offeree to understand it
and accept it -U.B.N VS. SAX (1994) 8 NWLR
(Pt. 361) 150." Per YAHAYA, J.C.A. (Pp.
15-16, paras. G-C) - read in context
10 CONTRACT - OFFER: Whether an offer when
made must be accepted first before a
contractual agreement can come into being
"...when an offer is made, it must be accepted
first before a contractual agreement can come
into being - COLLEGE OF MEDICINE VS.
ADEGBITE (1973) 5 SC 149." Per YAHAYA,
J.C.A. (P. 22, paras. C-D) - read in context
11 CONTRACT - OFFER: What constitutes an
offer
"In Chitty On Contracts, 26th edition, page 34
paragraph 42 appears the following statement
of the law on what constitutes an "offer": "The
offer is an expression of willingness to
contract made with the intention (actual or
apparent) that it shall become binding on the
person making it as soon as it is accepted by
the person to whom it is addressed. Under the
8
objective test of agreement, an apparent
intention to be bound will suffice if the
conduct of the alleged offeror (A) is such as to
induce a reasonable person to believe that he
is making the alleged offer and if the offeree
(B) actually holds that belief. In such
circumstances, "A" is considered to make an
offer even though he has no subjective
intention to do so." Per TUR, J.C.A. (P. 37,
paras. C-F) - read in context
12 CONTRACT - TERMS OF A CONTRACT:
Whether the trial Court is duty bound to
interpret the express terms of the contract
between the parties in order to arrive at their
intention
"At the close of filing and exchange of
pleadings coupled with the hearing of oral and
documentary evidence, the duty of the trial
Court was to interprete the express terms of
the contract between the parties in order to
arrive at their intention. See Ihezukwu vs.
University of Jos (1990) 7 SCNJ 95." Per TUR,
J.C.A. (P. 34, paras. D-F) - read in context
ABUBAKAR DATTI YAHAYA, J.C.A. (Delivering
the Leading Judgment): This appeal has arisen
from the judgment of the High Court of the Federal
Capital Territory Abuja, in Suit No. FCT/HC
9
/CV/429/2009 Pablo Amaran (carrying on business
under the name and style of Amaran & Associates
vs. Education Trust Fund, delivered on the 11th day
of December 2012. The appellant was the plaintiff,
and his 23 paragraphs statement of claim, was filed
on the 15th of December, 2009. The respondent as
defendant, filed a 22 paragraphs statement of
defence. Both parties had front-loaded their
documents.
The respondent had made an offer to the Appellant
vide its letter dated the 14th of June 2006, for the
recovery of the sum of N3,056,961,414.29 (Three
Billion, Fifty-Six Million, Nine Hundred and
Sixty-One Thousand Four Hundred and Fourteen
Naira, Twenty-Nine kobo) belonging to it and
trapped in some failed banks, within six months.
The Appellant replied, accepting the offer but stated
that the commencement date of the agreement was
to be when the failed bank were liquidated by the
Nigerian Deposit Insurance Corporation (NDIC)
instead of the six months from accepting the offer.
The appellant wrote a letter to the Respondent on
the 17th of October, 2007 informing it of the steps
it had taken towards the recovery of the said
amount. The respondent replied on the 10th of
December, 2007, stating that since the trapped
funds were not recovered within the six months
envisaged, the services of the appellant were no
longer needed in that area. The appellant
disagreed,
asked
the
respondent
to
pay
(N20,000,000.00) in quantum meruit, and when it
10
failed to do so, went to court, claiming
N15,000,000.00, as professional fees for actions
taken to recover the funds, and interest on the said
sum at the rate of 21% per annum till judgment
and at 16% till final liquidation.
The matter went to trial and at the end, the claims
of the appellant were dismissed. Being dissatisfied,
he has appealed to this court on four grounds of
appeal.
In the Appellant's brief of argument filed by its
counsel Mr. Amaran, on the 26th of February 2013,
three issues were identified 1. Whether there was a valid contract by the
letter of offer of the Respondent dated 14th of
June 2006, to the Appellant and the Appellant
acceptance by their letter of 28th of June,
2006 to the Respondent?
2. Whether by the actions of the parties and
the non refutation of the start off date of the
contract by the Respondent, the start off date
of the contract was not when the failed banks
were liquidated by the Nigeria Deposit
Insurance Corporation?
3. Whether by the termination of the contract
by the Respondent, the Appellant is not
entitled to damages or payment of quantum
meruit?
11
The Respondent's brief of argument was settled by
its counsel Mr. Ogbuagu and filed on the 1st of
March 2013. In it, the appellant's issue No.1, was
adopted as the only issue for determination. I shall
be guided by the Issues raised by the appellant in
resolving this appeal.
ISSUE No.1
Learned counsel for the appellant on this Issue,
referred to the letter of offer from the respondent,
dated 14th June, 2006 and the appellant's letter
dated 28th of June 2006 stating that "We hereby
accept your offer", to submit that a binding contract
had come into existence between the parties on
28/6/06 - F.G.N. vs. ZEBRA ENERGY LA (2002)
18 NWLR (Pt. 798). He submitted further, that by
the appellant's acceptance letter, it had informed
the Respondent that the start-off date of the
contract could "only legally commence" when the
failed bank were liquidated by NDIC, and that this
information was "confirmed by the letter of the
NDIC, of 22/11/06, which was forwarded to the
respondent, by the appellant in its letter dated
9/1/07. He therefore argued that the appellant did
not in any way vary the terms of the offer or make
a counter offer, but merely informed the
respondent of the position, which never refuted it.
Learned counsel for the appellant submitted
further, that the respondent gave reasons for
terminating the contract to be failure to make the
recoveries within 6 months and the Newspaper
Publication by NDIC, and that the respondent never
12
stated that the revocation was due to the
appellant's variation of the terms or the
counteroffer. He argued that the letters of
termination of the contract by the respondent,
confirm that the contract had come into existence,
with the appellant's letter of acceptance of 28/6/06
"....and that the defendants were not under
any illusions that there was a variation of the
contract or that the acceptance was a counter
offer."
Counsel argued also, that the trial court erred
when it held that the facts of this case, are similar
to
the
case
of
AKINYEMI
vs.
ODU'A
INVESTMENT COMPANY LTD (2012) MJSC. (Pt.
11) 160, because in that case, the Supreme Court
had held that there was a binding contract and a
counter-offer could not be implied. The same
argument was proffered in respect of ORIENT
BANK
(NIG)
PLC
VS.
BILANTE
INTERNATIONAL LTD (1997) 8 NWLR (Pt.
515) 1 - 186, and the case of DALEK (NIG) vs.
O.M.P.A.D.E.C. (2007) 7 NWLR (Pt. 1033).
Since the courts cannot make a contract for the
parties or rewrite the one which they have made UNION BANK VS. OZIGI (1994) 3 NWLR (Pt.
333), this court should hold that the appellant's
acceptance letter did not amount to a variation of
the contract or a counter offer, and that a binding
contract binds the parties.
13
In his response, learned counsel for the respondent
made submission on what amounts to a contract
between parties and placed reliance on YARO VS.
AREWA CONSTRUCTION LTD (2007) 16 NWLR
(Pt. 1063) 333 at 377 - 378; B.F.I.G vs. B.P.E.
(2008) ALL FWLR (Pt. 416) 1915 at 1937 and
ORIENT BANK VS. BILANTE INTERNATIONAL
(SUPRA). He referred to the offer letter of the
respondent, which made the commencement period
a condition, since the offer was made subject to this
term. He cited NDIC VS. OKEM ENTERPRISES
LTD (2004) 10 NWLR (Pt. 880) 52; EBHOTA
VS. PLATEAU INVESTMENT AND PROPERTY
DEVELOPMENT LTD (2005) 15 NWLR (Pt.
948), and TEXACO PANAMA VS. SHELL (2002)
5 NWLR (Pt. 759) at 10 - 11. He argued
therefore, that the 6 months period for completion
of the agreement was a vital ingredient of the offer.
Counsel argued that although the respondent in its
letter of 28/6/06, it had said it accepted the offer,
it nevertheless varied the offer in terms of the
commencement period. He referred to the Black's
Law Dictionary 8th Edition and the case of
AKINYEMI VS. ODU'A INVESTMENT (2012)
LPELR - SC.85/2002 on what amounts to an
acceptance of an offer and argued that the
purported acceptance by the appellant was not on
the terms of the offeror, nor in the manner so
requested. Since it was a qualified acceptance, it
was no acceptance and there was no valid contract
- DALEK LTD VS. OMPADEC (2007) ALL FWLR
14
(Pt. 364) 204 at 235 and LAWAL vs. UNION
BANK PLC (1995) 2 NWLR (Pt. 378) at 31. He
submitted that there is nothing to indicate that the
new terms offered by the appellant, were accepted
by the respondent either in writing or by conduct
and so there is no valid contract.
On the submission of counsel for the appellant that
the appellant who set a new time within which the
contract can be performed is deemed to have
affirmed the contract with a fresh period of
performance, counsel for the respondent submitted
that this is so only if the offeror had done
something to indicate acceptance of the fresh
period, as held in F.G.N. VS. ZEBRA (SUPRA),
where the Federal Government as the initial
offeror, had extended the period within which to
pay. This is not the case here, he said.
On keeping the offer open after the appellant had
commenced performance, counsel argued that the
appellant could not have commenced performance
since he had extinguished the offer by his counteroffer.
Counsel also submitted that the intention of the
parties was at no time identical and so there was
no consensus ad idem, and so there was no
agreement - A.G KADUNA VS. ATTA (1986) 4
NWLR (Pt. 38). The court cannot presume
anything he argued.
A binding contract that is capable of being enforced
15
by the court, must possess the ingredients of offer,
acceptance, consideration, intention to create legal
relations and capacity to contract - OMEGA BANK
VS. O.B.C LTD (2005) 8 NWLR (Pt. 928) 547;
CHIEF YARO VS. AREWA CONSTRUCTION LTD
(SUPRA) and B.F.I.G VS. B.P.E (SUPRA). Thus,
before an agreement can come into existence,
there must be an offer which is precise and certain,
which must be accepted unconditionally. An offer
springs from the offeror to the offeree, for the
purpose of entering into an agreement to do or
refrain from doing a thing.
It must be precise, to enable the offeree to
understand it and accept it -U.B.N VS. SAX
(1994) 8 NWLR (Pt. 361) 150.
An acceptance is a signal to the offeror, indicating
acceptance of the offer. It must be such that it is
the terms of the offer that have been accepted and
no less. The acceptance has to be clear,
unequivocal without variation. See U.B.N. VS.
OZIGI (1991) 2 NWLR (PT. 176) 677; INNIH
vs. FERADO (1990) 5 NWLR (Pt. 152) 604 and
GREEN FINGERS vs. YUSUF (2003) 12 NWLR
(Pt. 835) 488. In the 8th Edition of Black's Law
Dictionary "acceptance" was defined as
"An offeree's assent, either by express act or
by implication from conduct, to the terms of
an offer in a manner authorized or requested
by the offeror, so that a binding contract is
formed."
16
It is clear that the respondent made an offer to the
appellant, in its letter dated the 14/6/06. It states
in parts "2. I am pleased to convey approval for the
engagement of your firm to recover ETF funds
trapped in the banks due to the consolidation
in the banking industry. The list attached
herewith is for your ease of reference.
3. Please be informed that this offer is subject
to the following terms and conditions:
(a) professional fees will be based strictly on
commission basis as follows:
(i) 10% commission for debts that are below
N10 million;
(ii) 5% commission for amounts that are
above.
(b) there will be no pre-payment (mobilization
fee) and out-of-pocket expenses but fees shall
be settled within 14 (fourteen) working days
of receipt of cheques in connection with this
brief;
(c) the completion period of this brief is 6
(six) months from the date of acceptance of
this offer by you.
4. Kindly indicate in writing acceptance of this
offer within 7 (seven) days from the date of
this letter and liase with our Finance
Department for necessary details, please."
The time duration was thus made an essential part
of the agreement and it is six months from the date
17
the appellant accepted the offer. See also the
respondent's witness statement on oath - page 42
of the record.
On the 28th of June 2006, the respondent replied
the offer letter of the appellant. It did so, 15 days
after the letter of offer when it was supposed to do
so, within 7 days from the 14/6/06! Excerpts of the
letter of the appellant dated 28/6/06 state "We hereby accept your offer. Kindly note that
the start off date for the completion period
shall commence on the date the banks were
fully liquidated by the Nigerian Deposit
Insurance Corporation."
Paragraph 8 of the appellant's statement on oath,
at page 9 of the record states that "By our letter dated the 28th June, 2006, we
accepted
the
defendant's
offer
but
categorically stated therein that we could only
start the recovery exercise when the banks
concerned are fully liquidated by the Nigerian
Deposit Insurance Corporation (NDIC). The
said letter is also before the court. I rely on it
in support of this statement."
I have looked at the letter of 28/6/06. It never
stated therein, that the appellant "could only start
the recovery exercise when the banks concerned
are fully liquidated by NDIC". The letter stated that
"the completion period shall commence on the date
the banks were fully liquidated, by NDIC, In other
18
words the letter of 28/6/06 did not state inability to
commence immediately after accepting the offer,
whether legally or otherwise. It never gave a
reason why the exercise will commence only when
the affected banks are fully liquidated. It is to be
noted that the letter of 28/6/06 by the appellant
was written even before the letter of the NDIC of
22/11/06 was written, so the letter of 28/6/06 by
the appellant, could not have been because of the
letter of NDIC of 22/11/06. Furthermore, there is
nothing in the letter of NDIC of 22/11/06, stating
that the appellant could not do anything until
liquidation. The letter of the NDIC of 22/11/06
could therefore not be the reason why a different
commencement date was stated by the appellant in
its letter of 28/6/06.
At any rate, the position of the appellant is that it
accepted the offer of the respondent and it did not
vary it or make a counter-offer.
When time is provided for the satisfaction of a
condition, then time is made the essence of the
agreement. Here, time was provided for the
commencement of the agreement and a duration
for its completion was spelt out. Time was therefore
made an essential part of the agreement. The
appellant needed to accept it unequivocally, before
there can be a consensus. The acceptance can be
discerned from the correspondences between the
parties, from their words or from their conduct.
Usually, there is not much of a problem when the
acceptance is by means of documents or words. It is
19
acceptance
by
conduct
that
presents
the
challenges. In such a situation, the evidence upon
which a court will infer the acceptance, must be
positive and of such qualify, that it is plain, that the
offeree intended to accept the offer.
In the instant case, the appellant in accepting the
clear offer made by the respondent, suggested or
countered with another commencement date,
different in essence, with the date stated in the
offer, which is very material as time is of the
essence of the offer. Although it termed it
"acceptance" of the offer, its 'acceptance' was not of
the offer made by the respondent, and so the issue
had now gone back to the respondent as offeror, to
accept this counter-offer, As of that moment, there
was no consensus, no meeting of the minds
between the parties. There is no evidence before
the court, that the respondent as offeror, had
accepted the counter-offer of the appellant. Its
silence and non response to the counter-offer,
cannot be construed as meaning that it had
accepted same. This is because there is no positive
evidence, or verifiable conduct on the part of the
respondent indicating the acceptance of the
counter-offer and no court can infer it. It is a
matter of evidence or conduct capable of leading to
the inevitable conclusion, that there was such
acceptance. The court cannot guess or go into
speculation. If anything' the silence of the
respondent on the variation of the commencement
date, which is an essential condition of the offer,
20
made outside the period stipulated for accepting
the offer, is a strong indicator of its disagreement
with the variation. This is further seen from its
letter dated 10/12/07 (page 53 of the record),
which also at paragraph 2 thereof, stated that it
had earlier on, intimated the appellant that it
"would no longer proceed with the transaction."
It complained of the failure of the appellant to
perform within six months, obviously from the date
stated in the offer letter, and not remotely, in
respect of the counter-offer date! The position is
strengthened
by
the
respondent's
Witness
Statement on Oath, at paragraphs 4(c), 5,6, 7, 8
and 10 of pages 42 - 43 of the record thus 4(c) "The completion period of this brief is six
(6) months from the date of acceptance of this
offer by you.
5. That in response to the Defendant's offer,
the plaintiff valid the term (c) of the offer thus
- 'Note that the start off date for the
completion period shall commence on the date
the banks were fully liquidated by NDIC.
6. That the said variation amounted to a
counter-offer in its letter of 28th June 2006,
which we also rely on.
7. That as a result of the said variation, which
was subject to the Defendant's acceptance,
the Defendant lost interest on the offer and
21
suspended further correspondence with the
plaintiff.
8. That the plaintiff neither got any acceptance
of the counter-offer nor any further instruction
on the proposal.
10. That having not accepted the counteroffer, it was surprising when the plaintiff came
up with a letter of update on the purported
recovery when the Defendant had infact
forgotten about the Proposal by not replying
to accept the plaintiff's counter-offer."
As stated earlier on, when an offer is made, it must
be accepted first before a contractual agreement
can come into being - COLLEGE OF MEDICINE
VS. ADEGBITE (1973) 5 SC 149. And when
parties clearly express their intention in a
document, it is that document that will be looked
at, not other documents that do not form part of
the intention of the parties - NNEJI VS. ZAKHEM
(2006) 12 NWLR (Pt. 994) 297. Here, the
respondent offered a date of commencement of the
agreement. The appellant felt that the date was not
feasible
and
so
counter-suggested
another
commencement period. It was definitely not an
ADVICE offered by the appellant but a categorical
counter-offer. The appellant did not accept the offer
in terms of the offer of the respondent, so it was
not an acceptance. There is no document before the
court to show that the appellant accepted the offer
22
wholesale, as it should have done. There is also no
document to show that the respondent accepted the
counter-offer. The court cannot look at other
documents not forming part of the agreement
between the parties to determining whether there
was an agreement or not. The law is clear that
where an agreement is subject to confirmation by a
party, who fails to so confirm it, and he goes ahead
to add further conditions, then the agreement is
reverted to a position of negotiation. It is only
when the new terms are accepted by the original
party offering, that a binding contract can come to
fruition - LAWAL VS. UNION BANK (SUPRA) at
page 31. Similarly, when an offeror makes an offer,
and the offeree adds conditions or varies the terms
of the offer, there is no acceptance of the offer, and
the offeree now becomes an offeror of the new
terms and negotiations begin again. If the original
offeror accepts the new terms, as offeree, then a
binding contract arises, otherwise there is no
acceptance and there is no agreement binding on
the parties.
Learned counsel for the appellant had placed
reliance on the decision of the Supreme Court in
F.G.N VS. ZEBRA (SUPRA) at 216, which held
that "Where time is of the essence of a contract,
the innocent party who has set a new time
within which the contract can be performed is
deemed to have affirmed the contract and set
a fresh Period of performance"
23
In that case, Zebra Energy had, in its letter of
22/3/99, accepted the offer of the Federal
Government unequivocally in the terms of the
offer. There was no variation. This is quite different
from the instant case, where the appellant had
made a counter-offer. Again, when Zebra Energy
wrote, seeking clarification on what amount,
represents signature bonus, and how much was for
the reserve value, it was only information that was
being sought, even then, after the offer had been
accepted. Here, the letter of the appellant of
28/6/06 was not seeking for information or even
advice. And when Zebra later wrote, requesting for
further extension of time for the payment of the
second installment, the Federal Government
acceded to that request. It was in that context that
the Supreme Court held that "there was a validly
existing and legally binding contract between the
appellants and the respondent!! So in Zebra's case,
there was already a valid contract, having been
accepted and it was during its performance, that an
extension, i.e. a new time within which the contract
can be performed, was sought for and granted.
Nothing of that soft happened here. Affirmation of
contract is not the same as accepting an offer. This
is because in affirmation, a contract already exists,
but in acceptance of an offer, the contract has not
yet been born, until the offer is unequivocally
accepted. Learned counsel for the appellant also
relied on the holding of the Supreme Court in the
said Zebra case, that 24
"Where
an
offeree
has
commenced
performance, the offeree has no alternative
but to keep the offer open...."
to submit that the respondent should have kept the
offer open, since the appellant had commenced
performance of the agreement.
Counsel for the respondent argued and I agree,
that since the appellant had made a counter-offer,
it had extinguished the offer, and nothing can be
left open, when it is non-existent. It should also be
noted that performance can only commence when
there is infact, a contract in existence. There was
none in this case. Further, by the letter of offer,
the 'performance' of the appellant can only come to
be, if it begins to recover the sums trapped in the
banks. The appellant's witness statement on oath,
has not stated that any sums had been recovered
or even that the failed banks had been liquidated,
On the other hand, the respondent's statement on
oath at paragraph 18, states that "no single
recovery has been made" by the appellant. So
where is the performance that would warrant
keeping the "offer" open?
The submission of counsel to the appellant at page
17 of the brief, and relying on YARO vs. AREWA
(2007) 17 NWLR (Pt. 1063) 378 applies when
parties have already entered into an agreement
binding on them, and a new term is sought to be
introduced. It does not apply here, where no
25
agreement had been reached.
Since there was no meeting of the minds between
the appellant and the respondent i.e. no ad idem
there was no binding contract - OGUNDALU VS.
MACJOB (2006) 7 NWLR (Pt. 978) 148, and
OLOWOFOYEKU vs. A.G. OYO (1990) 2 NWLR
(Pt. 132) 369. The respondent was talking about
six months from the date of accepting the offer for
the funds to be recovered. The appellant was
talking about six months from when the failed
banks are liquidated. It means that the date of
commencement and of course the completion
period could not be ascertained at all, since it was
dependent upon the performance of an event by a
third party (liquidation of the banks by NDIC). This
was a date nobody could pin point, since nobody
could say when the legal cases in court concerning
the bank could end, and when the liquidation could
commence.
Further, the counter-offer had infact introduced an
impossibility to accept and perform as offered by
the respondent. In other words, the appellant was
saying that it was impossible to commence recovery
of the funds, "from the date of acceptance" of the
offer, and to complete within the next six months.
When it is impossible to accept an offer, it simply
means that it had not been accepted as offered,
and so there could not have been a valid
agreement.
The appellant as the plaintiff, made the positive
26
assertion, that there is a valid contract binding it
and the respondent, as it had accepted the offer
without variation. The onus is thus on it, to prove
the assertion - Section 131 of the Evidence Act
2011 and VULCAN GASES vs. G.F IND (2001) 9
NWLR (Pt. 719) 610. The trial court found that
there is no valid contract between them, as there
was no acceptance of the offer, and no acceptance
of the counter-offer. A trial court has the
pre-eminent duty of appraising evidence adduced
before it and to ascribe probative value to such
evidence. An appellate court does not interfere with
this duty, unless and until the trial court fails to do
so or properly do so, to such an extent that a
miscarriage of justice has been occasioned, where
the finding is perverse, not supported by evidence
or there was a wrong exercise of discretion. See
KAMOLU VS. UMUNNA (1997) 5 NWLR (Pt.
505) 321; KUFORIJI vs. V.Y.B LTD (1981) 6 - 7
SC 40; WOLUCHEM vs. GUDI (1981) 5 SC 291
and AGBAKOBA vs. I.N.E.C (2008) 18 NWLR
(Pt. 1119) 489.
Having gone through the record of appeal, the
findings of the trial court were based on the
evidence properly led before it. It has made the
correct findings and this court cannot interfere.
Clearly, the appellant had not discharged the
burden placed on it to prove the existence of a
valid contract between it and the respondent.
ISSUE No, 1 is thus resolved in favour of the
respondent and against the appellant.
27
ISSUE NO.2
Whether by the actions of the parties and the
non refutation of the start off date of the
contract by the Respondent, the start off date
of the contract was not when the failed banks
were liquidated by the Nigerian Deposit
Insurance Corporation?
Learned counsel for the appellant submitted that
the trial court had held that the Appellant from
their letter of acceptance dated 28th June, 2006,
had informed the Respondent of the start off date
of the contract, and that the Respondent never
disputed the start off date or protested against it.
He then went on to make the submissions
regarding F.G.N VS. ZEBRA ENERGY (SUPRA)
and YARO vs. AREWA (SUPRA).
The learned counsel for the respondent in his
submission, had distinguished the case of
ATTORNEY-GENERAL KADUNA STATE VS.
ATTA (1986) 4 NWLR (Pt. 38), with this case
because series of meetings were held between the
parties in Atta's case and the plaintiffs had made
efforts to ascertain the reason for the silence of the
defendants, as approval was needed before
proceeding. Those elements are not present in this
case and I agree that it does not apply.
I have actually resolved this Issue No. 2, whilst
resolving Issue No. 1. The start off date suggested
by the appellant amounted to a counter-offer which
28
was not accepted by the respondent either
specifically or impliedly, There was no valid
contract between them and so there couldn't have
been a "start off date of the contract". Further,
there is no evidence led by the appellant, that the
affected failed banks had been liquidated at all, up
to the time of the filing of the suit at the trial court.
All the appellant had said, is at paragraph 14 of the
appellant's witness statement on oath, that it was
All States Trust Bank Plc, that was liquidated. All
States Trust Bank is not one of the affected failed
banks where the funds of the respondent had been
trapped.
On the other hand, paragraph 17 of the
respondent's witness statement on oath, states that
the Defendant has neither received nor been called
upon by NDIC or any Body for that matter for the
payment of the funds, almost four years into the
alleged contract."
With this position, it is definitely obvious, that the
offer was not capable of being accepted since its
commencement date is impossible and its
completion date unachievable. There was no
agreement and so there was in reality, no start off
date agreed to by the parties. Issue No. 2 is
resolved in favour of the respondent and against
the appellant.
ISSUE NO. 3
Whether by the termination of the contract by
29
the Respondent, the Appellant is not entitled
to damages or payment of quantum meruit?
This Issue has become academic since there was no
valid contract between the parties in the first place
and so its termination by the Respondent, does not
arise. Issue No. 3 is struck out.
The result is that this appeal lacks merit in toto and
it fails. It is dismissed, with N30,000 costs to the
respondent.
JOSEPH TINE TUR, J.C.A.: I agree with the lead
judgment delivered by my learned brother,
Abubakar Datti Yahaya, JCA that this appeal
lacks merit and should be dismissed. I refer to the
facts pleaded in the Statement of Claim, relevant
paragraphs of which read as follows:
"1. The Plaintiff is a firm of solicitors and advocates
duly registered under the Nigerian Laws and has its
office at 2nd Floor, Nurses House, PC.43, Afribank
Street, Victoria Island, Lagos.
2. The defendant is an agency of the Federal
Government established by an Act of the National
Assembly and charged with the responsibility of
collecting and managing education taxes collected
from registered companies in Nigeria with its head
office at No.6, Zambezi Crescent, Off Aguiyi Ironsi
Street, Maitama, Abuja.
3. The defendant by a letter dated 14th of June,
2006, engaged the service of the Plaintiff in the
recovery of its trapped funds in some designated
30
distressed banks.
4. The Plaintiff avers that by the content of the
defendant's letter of instruction, it is entitled to
10%
commission
of
every
debt
below
N10,000,000.00 (Ten Million Naira) it recovers on
behalf of the defendant and a commission of 5% on
every debt above N10,000,000.00 (Ten Million
Naira). The letter of instruction with which the
plaintiff was briefed of the said task is hereby
pleaded and the plaintiff shall found on it at the trial
of this matter.
5. The plaintiff further avers that the list of the
commercial banks over which it had the mandate of
the defendant to recover trapped funds from are as
follows:
(i) City Express Bank Plc
N53,483,561.64
(ii)
Fortune
International
Bank
Plc
- N218.785.479.46
(iii) Gulf Bank Plc
N546,727,397.29
(iv)
Metropolitan
Bank
Plc
N208,147,260.26
(v) Peak Mechant Bank Plc
N166,950,000.00
(v) Hall Mark Bank Plc
N867,715.64
(vii)
Societe
Generale
Bank
Plc
N1,862,000,000.00
TOTAL
3,056,961,414.29
31
6. The plaintiff avers that by the terms of the
contract, it would have been entitled to the sum of
N152,891,455.789 (One Hundred and Fifty Two
Million, Eight Hundred and Ninety One Thousand,
Four Hundred and Fifty Five Naira, Seven Hundred
and Eighty Nine kobo) based on the agreed
commission to be paid at the completion of the job.
7. The plaintiff states that by its letter dated 28th
June, 2006, it accepted the defendant's offer but
categorically stated therein that the start off date
for the task shall be the date the banks concerned
are fully liquidated by the Nigeria Deposit Insurance
Corporation (NDIC). The said letter is hereby
pleaded and the plaintiff shall rely on it at the trial
of this matter.
8. The plaintiff states further that the defendant did
not at this time or any time whatsoever objected to
the position of the plaintiff as stated in the referred
letter.
9.The plaintiff then swung into action to put effect
to the instruction of the defendant by writing a
letter dated 5th October, 2006, intimating the
Nigerian Deposit Insurance Corporation (NDIC) of
its mandate to recover the trapped funds from the
concerned banks. The said letter is hereby pleaded
and the plaintiff shall rely on it at the trial of this
matter.
32
10. The plaintiff held several meeting with the staff
of NDIC in furtherance of the defendant's
instruction.
11. The Nigeria Deposit Insurance Corporation by a
letter dated 22nd of November, 2006, responded to
the above referred letter and stated that the
liquidation of seven out of the concerned banks was
being stalled by legal actions instituted by former
management of the banks challenging the
revocation of their licenses by the Central Bank of
Nigeria. The letter is hereby pleaded and the
plaintiff shall rely on it at the trial.
12. The plaintiff by a letter dated 9th of January,
2007, conveyed the above stated response from
the Nigeria Deposit Insurance Corporation (NDIC) to
the defendant and restated its position that
recovery can only commence when the banks are
fully liquidated by NDIC. The letter is hereby
pleaded and the plaintiff shall rely on it at the trial
of this matter.
13. The plaintiff by a letter dated 17th of October,
2007, gave an updated of the recovery task
undertaken by them for the defendant and drew
the attention of the defendant to a publication of
15th October, 2007 in the THISDAY Newspaper
where the NDIC announced the commencement of
payment of insured deposits of the public sector
depositors in the liquidated of All States Trust Bank
Plc. The letter is hereby pleaded and the plaintiff
33
shall rely on it at the trial.
14.The plaintiff avers that by a letter dated 10th of
December, 2007 the defendant without recourse to
the acceptance letter of the plaintiff dated 28th
June, 2006 where the plaintiff stated that the
recovery process can only commence on the date
when the concerned banks are fully liquidated,
terminated its contract with the plaintiff. The letter
is hereby pleaded and shall be relied upon at the
trial of this suit.
15. The plaintiff further avers in addition to the
above that the defendant's decision to terminate its
contract was taken when the plaintiff had informed
it of the readiness of the said deposits for
collection."
At the close of filing and exchange of pleadings
coupled with the hearing of oral and documentary
evidence, the duty of the trial Court was to
interprete the express terms of the contract
between the parties in order to arrive at their
intention. See Ihezukwu vs. University of Jos
(1990) 7 SCNJ 95.
In Mandilas & Karaberis Ltd. vs. Otikiti (1963)
1 All NLR 22 at 26, Bairamian, F. J., held that
"...When a contract is reduced into writing, the
writing gives the terms agreed upon." See also
Olaniyan & Ors. vs. Unilag (1985) 2 NWLR (Pt.
9) 599 and A. A. Macaulay vs. NAL Merchant
34
Bank Ltd. (1990) 6 SCNJ 117 at 133. Before the
parties come to a binding contract they usually
enter into negotiations. It is the certainty of the
terms the parties arrived at that determines their
intention and whether there is a binding contract.
This was made clear in Omega Bank Nigeria Plc
vs. O.B.C. Ltd. (2005) 1 SCNJ 150 at 170 lines
14 to page 171 lines 1-8 thus:
"When negotiations are in progress between the
parties intending to enter into a contract the whole
of those negotiations must be considered so as to
determine whether, if at all, the contract came into
being. The parties here intended to have a written
contract and by their rejection of Exhibit "P7", the
respondents must be taken to have refused to
enter into the contract with the appellant.
Accordingly, there was no contract entered between
the parties.
Before I part with this issue, I think I need to
emphasize and reiterate that although Courts may
not make contract for the parties where none
exists, the Courts will seek to uphold bargains made
commercially, wherever possible recognizing that
they often record the most important agreements in
crude and summary fashion and will seek to
construe any document fairly and broadly without
being too astute or subtle in finding defects. See
Brown vs. Goold (1972) Ch.53, Hillas and Co.
Ltd. vs. Arcos Ltd. (1932) 147 LT 503. After
due consideration of all the circumstances and if
satisfied that there was an ascertainable and
determinate intention to contract, the Courts will
35
strive to give effect to that intention looking at the
intent and not the mere form. But in the instant
case there is no sufficient certainty as to the
acceptance of the terms offered by the appellant in
Exhibit "P7", rather it was manifest that the
respondent rejected the offer made by the appellant
in Exhibit "P7". It is impossible under all the
circumstances of this case to take Exhibit "P6" as
an offer or acceptance of an offer. It is a document
not signed nor addressed to the respondent, it is a
worthless document which does not have any
efficacy in law. Accordingly, any agreement entered
into by Mr. Ali and the Pw1 to amend it does not
qualify it to be an agreement initiated by the
respondent in Exhibit "P5". Thus issues 1, 2, 3
and 4 all broadly relating to the existence of a
binding contract between the parties are deemed to
have been discussed under this issue and the end
result being that there is no enforceable contract
proved by the respondent. The respondent clearly
rejected the offer of the appellant in Exhibit "P7",
it cannot claim the existence of any other contract,
written or oral."
The respondent's offer or proposal to the appellant
was not only subject to acceptance, but the terms
upon which the offer was to be accepted by the
appellant to bring into a binding legal contract were
clearly stated in the agreement. The appellant did
not just accept exactly the terms upon which the
offer was made, but introduced a third party into
the agreement, namely, the Nigeria Deposit
36
Insurance
Corporation.
The
appellant
had
"...categorically stated therein that the start
off date for the task shall be the date the
banks concerned are fully liquidated by the
Nigeria
Deposit
Insurance
Corporation
(NDIC). The said letter is hereby pleaded and
the plaintiff shall rely on it at the trial of the
matter" See paragraph 7 of the Statement of
Claim. These were not terms in the original offer
made by the respondent to the appellant.
In Chitty On Contracts, 26th edition, page 34
paragraph 42 appears the following statement of
the law on what constitutes an "offer":
"The offer is an expression of willingness to
contract made with the intention (actual or
apparent) that it shall become binding on the
person making it as soon as it is accepted by
the person to whom it is addressed. Under the
objective test of agreement, an apparent
intention to be bound will suffice if the
conduct of the alleged offeror (A) is such as to
induce a reasonable person to believe that he
is making the alleged offer and if the offeree
(B) actually holds that belief. In such
circumstances, "A" is considered to make an
offer even though he has no subjective
intention to do so."
The learned authors have defined what constitutes
"acceptance" at pages 44-45 paragraph 54 as
follows:
37
"An acceptance is a final and unqualified
expression of assent to the terms of an offer.
The objective test of agreement applies to an
acceptance no less than to an offer. On this
test, a mere acknowledgment of an offer
would not be an acceptance; nor is there an
acceptance where a person who has received
an offer to sell goods merely replies that it is
his "intention to place an order." Where the
offer is made in alternative terms, the
acceptance must make it clear to which set of
terms the assent is directed. In Peter Lind &
Co. Ltd. vs. Mersey Docks & Harbour Board
(1972) 2 Lloyd's Rep. 234 an offer to build a
freight terminal was made by a tender quoting
in the alternative a fixed, and a "cost-plus,"
price. The offeree purported to accept "your
tender", and it was held that there was no
contract.
Negotiations with a view to contracting may
be long and complicated; and in such cases it
may be hard to tell when (if at all) an offer has
been made and accepted. The Court then has
to look at the whole course of the negotiations
and to determine at what point (if any) the
parties reached agreement. The parties may of
course continue their negotiations after this
point has been reached; but this fact will not
affect the existence of the contract between
them unless the continuing negotiations can
be regarded as an agreement to rescind the
original contract."
38
The
Courts
take
into
consideration
the
correspondences that flowed from the parties
between the offer and acceptance as appears in the
Chitty On Contracts, 26th edition, pages 46-47
paragraph 56 as follows:
"Correspondence between acceptance and
offer: A communication may fail to take effect as
an acceptance because it attempts to vary the
terms of the offer. Thus an offer to sell 1,200 tons
of iron is not accepted by a reply asking for 800
tons; an offer to pay a fixed price for building work
cannot be accepted by a promise to do the work for
a variable price; an offer to supply goods cannot be
accepted by an "order" for their "supply and
installation." Nor, generally, can an offer be
accepted by a reply which varies one of its other
terms
(e.g.
that
specifying
the
time
of
performance), or by a reply which introduces an
entirely new term. Such a reply is not an
acceptance; but it may, on the contrary, be a
counter-offer, which the original offeror can then
accept or reject. On the other hand, statements
which are not intended to vary the terms of the
offer, or to add new terms, do not vitiate the
acceptance, even where they do not precisely
match the words of the offer. It is, moreover,
submitted that, if the new term merely makes,
express what would otherwise be implied, it does
not destroy the effectiveness of the acceptance. Nor
will it have this effect if it is merely a declaration by
the acceptor that he is prepared to grant some
39
indulgence to the offeror, e.g. to condone late
payment in return for specified interest. Similarly, it
is submitted, that an acceptance which asks for
some indulgence to the offeree is, nevertheless,
effective, so long as it is clear that the offeree is
prepared to perform even if the indulgence is not
granted: e.g. to buy for cash if his request for credit
is refused. The test in each case is whether the
offeror
reasonably
regarded
the
purported
acceptance "as introducing a new term into the
bargain and not as a clear acceptance of the offer."
It is also possible for a communication which
contains new terms to amount: (1) to an
acceptance of the offer, and (2) to a new offer to
enter into a further contract. In such a case, there
will be a contract on the terms of the original offer,
but none on the terms of the new offer, unless that,
in turn, is accepted.
After parties have reached agreement, the offer
and acceptance may be set out in formal
documents. The purpose of such documents may be
to record the agreed terms; and where one of the
documents performs this function accurately while
the other fails to do so, the discrepancy between
the offer and the acceptance will not prevent the
formation of a contract. In such a case, the Court
can rectify the document which fails to record the
agreed terms, and a contract will be concluded on
those agreed terms."
My humble view is that from the pleadings and
documentary exhibits tendered in the Court below,
40
the offer by the respondent was not wholly
accepted by the appellant who rather varied the
terms of the offer. There was no binding or
enforceable contract hence the claims of the
appellant were rightly dismissed by the learned
trial Judge.
MOORE A. A. ADUMEIN, J.C.A.: I had the
privilege of reading the draft of the judgment just
delivered by my learned brother, Abubakar Datti
Yahaya, JCA. His Lordship has elaborately dealt
with the issues in this appeal. I completely agree
with the reasoning and conclusions of my learned
brother.
For the comprehensive reasons given by my
learned brother, I find this appeal as lacking in
merit. I also dismiss the appeal with N30,000.00
costs against the appellant in favour of the
respondent.
Appearances
Pablo Amaran with him, Ebenezer
For Appellant
Akinbulu
For
Respondent
Obinna Ogbugbu
41