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WHEN TERMS OF CONTRACT ARE CLEAR, INTERPRETATION IS NEGLIGIBLE

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In the construction of a contract, the meaning to be placed on it is that which is the plain, clear and obvious result of the terms used. A contract or document is to be construed in its ordinary meaning, When the language of a contract is not only plain but admits of one meaning, the task of interpretation is negligible. See: Union Bank of Nig. Ltd & Anr Vs Nwaokolo (1995) 6 NWLR (Pt. 400) 127: Aouad & Anor Vs Kessrawani (1956) 1 FSC 35: Nwanowu Vs Nzekwu & Anor (19571 3 FSC 36: Orient Bank (Nig) Plc Vs Bilante Int. Ltd (19971 8 NWLR (Pt. 515) 37 @ 78 B-D.

— K.M.O. Kekere-Ekun JSC. B.O. Lewis v. United Bank for Africa Plc. (SC.143/2006, 14 January 2016)

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PARTIES BOUND BY CONTRACTUAL TERMS IN ABSENCE OF FRAUD

The well laid down position of the law is that Courts do not rewrite contact for the parties where the terms of the contract are clear. In the absence of fraud, duress and undue influence, misrepresentation, the parties are bound by their contract. It is only parties to a contract that can sue and be sued on it.

– Rhodes-Vivour JSC. Alade v. Alic (2010)

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A FAILED CONTRACT – BREACHED CONTRACT

A contract can be discharged by breach. A breach of contract means that the party in breach has acted contrary to the terms of the contract either by non-performance or by performing the contract not in accordance with its terms or by a wrongful repudiation of the contract. A party who has paid money to another person for a consideration that has totally failed under a contract is entitled to claim the money back from the other.

– Adekeye JSC. Nwaolisah v. Nwabufoh (2011)

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WHEN A CONTRACT OF SALE EXISTS

A contract of sale exists where there is a final and complete agreement of the parties on essential terms of the contract, namely the parties to the contract, the property to be sold, the consideration for the sale and the nature of the interest to be granted. Once there is agreement on these essential terms, a contract of sale of land or property is made and concluded. In a contract for sale of property, where part, payment was paid, the law is that the contract for purchase has been concluded and is final, leaving the payment of the balance outstanding to be paid, The contract for the sale and purchase is absolute and complete for which each party can be in breach for non-performance and for which an action can be maintained for specific performance.

— O.O. Adekeye, JSC. Mini Lodge v. Ngei (2009) – SC.231/2006

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ILLEGALITY OF A CONTRACT VIS-À-VIS PLEADINGS

In Northern Salt Co. v. Electroytic Alkaki Co. (1914) A.C. 461, Viscount Haldane, L.C., stated this rule at page 469, thus: “My lords, it is no doubt true that where on the plaintiff’s case it appears to the court that the claim is illegal, and that it would be contrary to public policy to entertain it, the court may and ought to refuse to do so. But this must only be when either the agreement relied on is on the face of it illegal, or where, if facts relating to such an agreement are relied on, the plaintiff’s case has been completely presented. If the point has not been raised on the pleadings so as to warn the plaintiff to produce evidence which he may be able to bring forward rebutting any presumption of illegality which might be based on some isolated fact, then the court ought not to take a course which may easily lead to a miscarriage of justice. On the other hand, if the action really rests on a contract which on the face of it ought not to be enforced, then, as I have already said, the Court ought to dismiss the claim, irrespective of whether the pleadings of the defendant raise the question of illegality.”

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PLEADED OR NOT, COURT WILL NOT CLOSE ITS EYES TO ILLEGAL CONTRACT

The attitude of the Courts to the issue of apparent or ex-facie illegality is certainly well settled. When a contract is ex-facie illegal, whether the alleged illegality has been pleaded or not, the Court would not close its eyes against illegality, as it is the duty of every Court to refuse to enforce such a transaction. In other words once illegality has been brought to the attention of the Court, it must be considered and resolved. See Gedge v. Royal Exchange Assurance Corporation (1900) 2 Q.B. 214 at 220; Akagbue and Ors. v. Romaine (1982) 5 S.C. 133; Nasr v. Berini (Betrut-riyad (Nigeria) Bank Ltd. (1968) 1 All N.L.R. 274 and Sodipo v. Lemminkainen (1986) 1 N.W.L.R. (Pt. 15) 220.

— Mohammed, JSC. Fasel v NPA (2009) – SC.88/2003

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WHAT IS BREACH OF CONTRACT?

Breach of contract arises in a situation wherein a party to an agreement, fails to perform his own obligations, thereby causing damages to the other party or parties to the agreement, who have taken certain steps on the basis of the agreement. In order to prove breach of contract, the party asserting must clearly show what actions or omissions the defaulting party is guilty of that constitutes the breach.

– Tukur JCA. Odulate v. FBN (2019)

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