Two wrongs can make a right

CHIEF ELIJAH OMONIYI AJAYI v. TOTAL NIGERIA PLC

SUPREME COURT OF NIGERIA

(MOHAMMED; MUNTAKA-COOMASSI; NGWUTA; PETER-ODILI; ARIWOOLA, JJ.SC)

The Respondent leased a parcel of land from Chief S. A. Ajayi (the Appellant’s father) for a term of 50 years. The Respondent built a petrol filling station on the land and entered into a Marketing Licence Agreement with Chief S. A. Ajayias a dealer for the Respondent.Upon the demise of his father, the Appellant took over the dealership of the filling station, and though he eventually executed a new Dealership Agreement with the Respondent, the parties had continued to communicate with the Respondent writing to the Appellant as Chief S. A. Ajayi.

The Respondent decided to terminate the dealership and wrote to the Appellant – but in the name S. A. Ajayi.

The Appellant challenged the termination in court. The Respondent also counterclaimed for the surrender of the filling station. The trial court dismissed the claims on the ground that the contract was illegal. The court held that:

“From the analysis above in the claim of the plaintiff, I hold that the termination of the Marketing License Agreement between the plaintiff and the 1st defendant is null and void by reason of the misrepresentation and impersonation between the parties.”

Both parties were unhappy with the decision of the trial court and the Respondent filed an appeal at the Court of Appeal while the Appellant filed a cross-appeal. The Court of Appeal found held that the Marketing License Agreement was not illegal and the termination was therefore valid.

The Appellant was dissatisfied and appealed to the Supreme Court. The Respondent in its brief raised the following issue for determination:

“Whether the appellant who entered into a Marketing License Agreement (exhibit A) in his own name but later, in the course of his performance of the said Agreement, wrote and accepted correspondence (exhibits D, D1, D2 and E in his late father’s name, without protest will not be deemed to have waive is right regarding his own name under the agreement as to be stopped from denying the effectiveness of a subsequent letter in his father’s name (exhibit C) terminating the agreement.”

The Appellant contended that the continued correspondence between the parties in the name of his deceased father Chief S. A. Ajayi instead of in his name Chief E. A. Ajayi was wrong, dishonest and fraudulent but conceded that he did not plead fraud at the trial court. The Appellant argued that the operation of the agreement between the parties was illegal as found by the trial court and that the illegality having been brought to the attention of the court, the court must take it into consideration notwithstanding the absence of pleadings.

On the question of whether or not the Appellant should not have been regarded as having waived his right to have been dealt with in his own name in the operation of the agreement, the Appellant argued that the fact that both parties in this appeal had jointly participated in the improper operation or misrepresentation in the names of the real parties in the agreement, cannot be a waiver of the effect of the wrongness or illegality.

The Respondent on the other hand argued that the Appellant having received letters from the Respondentaddressed toChief S. A. Ajayiand responded in the same name, he can be deemed to have waived his right to be referred to or addressed strictly and only as Chief E. O. Ajayi in relation to the agreement.

Unanimously dismissing the appeal, the Supreme Courtheld as follows:

“It is quite clear from the evidence on record that although the letter of termination of the agreement between the parties was addressed to Mr. S. Ajayi, even the appellant himself had not stated in very clear language at the trial court that his own identity as the other contracting party in the management of the business in the Total Filing Station at Ifaki-Ekiti, was in doubt. Where then I may ask, is the illegal transaction between the parties in exhibit C? The answer is definitely in the negative.

…On the question of the alleged illegality of the contractual relationship between the parties, the law is well settled that a contract is said to be illegal if the consideration or the promise involves the doing of something illegal or contrary to public policy or if the intention of the parties in making the contract is illegal or contrary to public policy. In otherwords, an illegal contract is void and cannot be the foundation of any legal right and also all transactions emanating from it are void. See Sodipo v. LemminkainenOy. (No. 1) (1985) 2 N.W.L.R. (Pt.8) 547 and Alao v. A.C.B. Ltd (1998) 3 N.W.L.R. (Pt. 543) 339 at 346. In the present case however, there is no single attribute of any illegality in the contractual relationship between the parties leading to the termination of the same by the respondent. In this respect the court below was on very strong grounds in setting aside the judgment of the trial court declaring the contract between the parties in exhibit A void and in allowing the appeal of the respondent by granting it relief in affirming the termination of the contract between the parties as contained in the letter of termination of the same in exhibit C.

In any case the appellant having received letters exhibits D, D1 and D2 from the respondent in the name of his late father S. A. Ajayi without any protest and in response having written the letter exhibit E to the respondent and signed the letter in the name of his late father S. A. Ajayi, I agree with the court below that the appellant was deemed to have waived his right to insist on being addressed strictly as E. O. Ajayi. See Ogbonna v. Attorney General Imo State (1992) 1 N.W.L.R. (Pt. 220) 647 at 691. In the same vein, by his conduct in stepping into the shoes of his father by addressing himself in the name of his late father, the appellant is estopped by virtue of Section 151 of the Evidence Act CAP 112 Laws of Federation 1990, applicable at the time of the transaction between the parties, from insisting that the letter of termination of the agreement between the parties exhibit C was not in his own name. See Joe IgaOrs. v. Amakiri&Ors. (1976) 11 S.C.1 at 12. For the foregoing reasons this first issue is resolved against the appellant.”

Counsel:

SeniAdio for the Appellant

E. F. Osifo for the Respondent

This summary is fully reported at (2013) 8 CLRN

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