Henrison Okechukwu v. Humphrey C. Onuorah

The plaintiff now appellant in this court was the respondent at the Court of Appeal. He was given judgment at the trial High Court of former Anambra State sitting at Onitsha. He is the son of a retired Minister of religion. The respondent is a businessman and was the defendant at the trial court and appellant at the Court of Appeal.
By a deed of lease made on 17th day of July 1972 between the plaintiff/appellant and the defendant/respondent and his late brother Davidson Orizu Onuorah and registered in Deeds Registry as No. 12 at page 12 in volume 8 the parties agreed as follows:-
“(i) To build on the site demised a storey building containing on the whole 8 (eight) shops and 6 (six) rooms and conveniences on the ground floor and 2 flats and conveniences on the first floor containing 8 (eight) rooms, that is, parlour and three bed rooms with conveniences on the second flat all in accordance with the approved building plan Nos. OPA/No.754, OUCC: 179/72 prepared in the Lessor’s name within one calendar year from the date the building plan is approved subject to unforeseen circumstances.
(ii) To give to the Lessor one shop, at the junction of Aljen Lane and Old Market Road on the ground floor free of rent and one flat containing parlour, 3 (three) bed rooms, latrine, bath toilet and kitchen on the first floor for his own

P.1

use or the use of other person or person authorised by him.
(iii) To pay to the Lessor a monthly rent of #14:5s (Fourteen pounds five shillings) per month for the areas of land and the building and convenience occupied by him on the leased. For the time being to pay to the Lessor the sum of #855 (eight hundred and fifty five pounds) representing five years rent paid in advance on executing this lease.
(iv) To pay rent half yearly in advance after the expiration of five years rent having been paid in advance. The building plan No. OPA/No. 754 OUCC,

As a result of the convenants in the lease the respondent erected a one storey building on the premises situated at 30 Old Market Road Onitsha. But the respondent was never in peace right from when he started developing the land. The plaintiff/appellant apparently invited the Town Engineer of Onitsha Local Government by a letter that the respondent was erecting an illegal structure whereby the initial structures erected were demolished by the council. The appellant referred to respondent as “unknown persons” in his letter to the Town Engineer of Onitsha Council. There was no evidence of any variation of the lease agreement between the parties but it seems the appellant created difficulties for the respondent during and after development of the land. Certainly the respondent, even though carried out all his obligations under the lease, was not in quiet possession due to harassment from the Onitsha Urban Council through instigation by the appellant. Despite paying the rent due and allowing the appellant to take possession of a flat on the first floor and one shop on the ground floor the appellant finally resorted to holding that the lease agreement itself was null and void. The appellant’s contention on nullity is predicated on the agreement not having a commencement date. The respondent’s argument is that the appellant (lessee) obtained the permission of Onitsha Urban Council to occupy the building after completion. This permission is referred to as “certificate of occupancy”, not a term of art as in Land Use Act, but were use of words to describe the permission to occupy a newly completed building if found by the relevant supervisory authority to be tenantable and habitable. The trial Court upon all the evidence before it gave judgment for the appellant taking refuge in the belief that the lease agreement had no commencement date and was therefore null and void.
On appeal to the Court of Appeal, trial court’s decision was set aside, and plaintiffs suit was dismissed. The appellate court held that Exhibit 1, the lease agreement, was valid and was not vitiated by absence of commencement clause because the date of commencement could easily be inferred from the

P.2

agreement, right from the date of its execution. The plaintiff has now appealed to this court.
The following issues have been formulated for the appellant:-
“(a) Were the learned Justices of the Court of Appeal right when they held that Exhibit one (i.e. the purported lease agreement) was valid?
(b) Whether Exhibit 1, which the Justices of the Court of Appeal held was valid actually contained the legal essential requirements that will make a lease valid?

(c) Whether the learned Justices of the Court of Appeal were right to have held that the Certificate of Occupancy obtained by the Lessor was sufficient to make the lease operational when in fact no such term or condition was contained in Exhibit 1.
(d) Was the learned trial Judge right to have considered other reliefs not in the alternative claim after he has pronounced and based his judgment on the alternative relief?
(e) Were the learned Justices of the Court of Appeal adversely influenced by the above method adopted by the trial court which affected them in holding that Exhibit 1 was valid?”
The main purport of any legal agreement is to set out clearly what the parties agreed upon. The agreement clearly states:-
“The lessor demises to the lessees all that parcel of land known as and called No. 30 Old Market Road, Onitsha to hold the same unto the lessees for a term of 50 (fifty) years from the day the lessees are issued with a certificate of occupancy in respect of the whole building or any part thereof.”
In Osho & Anor. v. Foreign Finance Corporation & Anor. (1991) 4 NWLR (Pt. 184) 157, 193 this court sets out requirements of valid lease as:
i. words of demise
ii. complete agreement leaving no ambiguity as to its purport
iii. the identification of the parties to the agreement
iv. the premises must be clearly identified,
v. commencement and the duration of the agreement.
.In Exhibit 1, the words of demise are clearly set out. The lease agreement is clear as to its purport, that is to say, giving on lease a plot of land to be developed by the defendants to a clear specification and on completion to have portions of the building for the plaintiff’s use absolutely without any charge. Parties to a suit must only plead facts and facts only and not law; similarly where a provision of law is alluded to in an agreement the coming into operation of that legal provision, when uncertain, is as good as stating a

P.3

commencement of the operative date of an agreement. The issuance of a “certificate of occupancy” i.e. the authority of the relevant council that a new building is fit for occupation after inspection, is a date always uncertain, but the authority certainly will be given if the building complies with all the health and structural regulations. Thus, the agreement, Exhibit 1, is clear is to its terms when it provides:
“From the day the lessees are issued with a certificate of occupancy in respect of the whole property or any part thereof’ As I mentioned earlier, a “Certificate of Occupancy” alluded to in the Exhibit 1 is not the same as in Land Use Act.

It is clear by Exhibit 1 that there is certainty that the local authority would not fail issuing the authority or consent to enter the building for purpose of habitation once there is certificate satisfying that it was built to specification. Thus the commencement date of Exhibit 1 can easily be inferred. The premises, No. 30 Old Market Road, Onitsha is clear on the agreement. It is clear the plaintiff did everything to frustrate Exhibit 1, and at his instance by letter to local authority, delayed issuance of authority to enter into the premises.
He however collected all rents due to him; he moved into a flat on the premises and similarly took possession of a shop as provided in the agreement without payment of any rent. When entering into an agreement of this nature the parties must be uberrimae fidei and I find nothing in the Exhibit 1 to defeat this presumption. This contract was subject to a contingency not for validity but for commencement and as I said earlier the authority to occupy the building was not forthcoming. Where parties agree in a solemn contract they are supposed to fulfill all the conditions therein faithfully and honestly. Parties who enter into a contract are expected to honour its terms. A party who induced the other party to enter into a contract, which contract provides benefits for the inviting party which he has utilized without complaint, he cannot be found to deny the validity of that contract.The appellant has enjoyed five years rent, he is still enjoying the occupation of a flat and a shop on the demised premises, it is not for him now to assert the invalidity of the contract. To my mind the invalidity is self-induced but it does not make the contract invalid. Where a contingency is uncertain as to precise time of occurrence, e.g. the issuance of authority to occupy the premises by local council, the mere statement that the time the authority is issued is the commencement is enough. The appellant, has benefited immensely from Exhibit 1 and he cannot now resile from it. All these years he collected all the

P.4

rents due, and had the benefit of occupying portions of the building erected on the land in question free of charge as provided in the agreement. He has no case against the respondent.
I therefore find no merit in this appeal and I dismiss it with N10,000.00 costs
to the respondent.

KUTIGI, J.S.C: I read in advance the judgment just delivered by my learned brother, Belgore J.S.C. I agree with his reasoning and conclusions. I also dismiss the appeal and hold that the lease in question was a valid lease. The judgment of the Court of Appeal is affirmed. Costs of N10,000 are awarded to the respondent.

IGUH, J.S.C.: I have had the privilege of reading in draft, the judgment just delivered by my learned brother, Belgore, JSC and I am in complete agreement with him that there is no merit in this appeal and that the same ought to fail. The background facts leading to this appeal have been fully set out in the leading judgment. I propose in this judgment to refer only to such facts as are directly relevant to the issues I desire to examine.
It is clear to me that the central issue for determination in this appeal is whether the decision of the court below reversing the judgment of the trial court and holding that the building lease, Exhibit 1, was valid is right in law. There is a second and subsidiary question that arises. This is whether even if the building lease, Exhibit 1, is void, this ipso facto deprives the respondent of all rights in and over the property in issue known as and described as 30 Old Market Road, Onitsha. I will deal with the central issue first.
It is common ground from the building lease, Exhibit 1, that the respondent and his late brother, as lessees, would take possession of the plot of land in issue and erect, at their own expense and in the name of the appellant, the lessor, a house of two floors thereon in accordance with the specifications in the approved building plan. Exhibit 2. The appellant, on completion of the building by the lessees would take a room or store on the ground floor together with one of the two flats on the first floor, while the lessees would remain in possession of the rest of the building for their own use to enable them recoup their outlay in the erection of the house from the rents and profits therefrom for the demise period of fifty years. The lease was to commence from the date the Onitsha Local Government issued its usual permission or authorisation for the occupation of the building. This authorisation, under the Onitsha Local Government Bye Laws is described as a certificate of occupancy. It has, however, nothing to do with the Certificate of Occupancy

P.5

created under the provisions of the Land Use Act, Cap. 202, Laws of the Federation of Nigeria, 1990. It is a mere declaration by the Onitsha Local Government that a new building has been inspected, that it complies with the approved building plan and that it is for human habitation under its Bye-Laws.
An annual rent of N1,700.00 was reserved under Exhibit 1. At the request of the appellant, the respondent paid him five years’ rent in advance. The receipt of this payment was duly acknowledged by the appellant. On the evidence of the said appellant, the five years’ rent covered the period, 1976 to 1981.
The appellant testified that in 1976, he added a second floor to the structure put up by the respondent on the demised premises. He went into occupation of his apartment in the property as stipulated under Exhibit 1 in 1976.

It is clear that as the appellant was still building the second floor of the house early in 1976, the certificate of occupancy by the Onitsha Local Government could not possibly have been issued or granted before then. It is also significant that the certificate of occupancy in respect of the new house was issued to the appellant on the 7th July, 1976 on the completion of the entire building. This certificate is Exhibit 7.
The learned trial Judge, Onwuamaegbu, J. at the conclusion of hearing was of the view that the commencement date in Exhibit 1 was uncertain, incapable of ascertainment at the time the lease was made and that it was consequently void and unenforceable. He declared:-
“It is a principle of law that for a lease to be valid, it must have a certain beginning and a certain end ….. If a lease is to commence at a future date, such future date must be capable of ascertainment at the time the lease is made and if it is not ascertainable at that time, then the lease is void for uncertainty ….. Therefore, in law, Exhibit 1 is not a lease at all and the defendant cannot claim any rights thereunder. ”
The Court of Appeal, for its own part, was unable to agree with the trial court on its conclusion that Exhibit 1 was void. It said:-
“It is also settled law that even if the terms of the lease are uncertain at its commencement, the fact that at some future date it will be made certain is sufficient to make it a good lease. In other words, the determining factor in each case is the certainty in future of the commencement date, since id certum est quod certum reddi potest.
In the instant appeal, the commencement date was to be the date on which the appellant obtained the Certificate of Occupation in respect of the premises. In the Nigerian context, one is tempted to take judicial notice of this practice.”

P.6

A little later in its judgment, the Court of Appeal went on:-
“In the instant appeal, however, the respondent claimed to have obtained the Certificate of Occupancy on 7th July, 1976 – barely four years after Exhibit 1 was executed …. In view of this, the validity of Exhibit 1 is beyond reproach, and it is hereby so declared.”
It is against this finding that the appellant has now appealed to this court. The main submission of learned counsel for the appellant, Mrs. V. J. O. Azinge is that the court below was in error when it held that the lease, Exhibit 1, entered into between the appellant and the respondent was valid in that its commencement date was uncertain and incapable of being determined at a future date. In this regard, she called in aid the decision in National Bank of Nigeria Ltd. v. Campagne Frassinet (1948) NLR 4.

Learned counsel argued that from the evidence before the court, the respondent had not yet obtained the certificate of occupancy which, according to her, is the event that will commence the lease. She cited the decision in United Bank for Africa v. Tejumola and Sons Ltd. (1988) 2 NWLR (Pt. 79) 662 at 682 and 686 and contended that the contingency upon which the lease would become operational and enforceable was yet to happen. She therefore submitted that the lease Exhibit 1, is void for uncertainty as the commencement date at the time of its execution was incapable of ascertainment. She contended that being thus void, no rights or obligations were created thereunder and that the parties were consequently returned to their original position before the execution of the purported instrument.
Learned counsel for the respondent, M.M. Usuman, Esq. in his reply argued that the commencement date of Exhibit 1 was ascertainable when it was made and that the same was in fact fixed by the parties several years before the institution of this suit on the 16th day of April, 1981. He conceded that it is correct law that a term of years must be for a definite period in the sense that it must have a certain beginning and a certain ending. He, however, drew the attention of the court to a statement of the law in Cheshire’s Modern Law of Real Property to the effect that although the parties may agree that a lease shall begin upon the occurrence of an uncertain event, such an agreement, though at first conditional, becomes absolute and enforceable as soon as the event occurs.
In this connection, learned counsel pointed out that the appellant pleaded and testified that the relevant certificate of occupancy was issued by the Onitsha Local Government on the 7th July, 1976. There is also evidence that the

P.7

appellant collected five years’ advance payment of rent as stipulated in Exhibit 1 for the period 1976-1981. In his view, it is clear that the parties were completely ad idem that the 50 year term commenced on the 7th July, 1976 on which date Exhibit 7, was issued. He submitted that Exhibit 1 could by no stretch of the imagination be said to be void.
It seems to me plain that for an agreement for a lease to be valid there must be, among other essentials, agreement on the date of commencement of the term; and in the absence of this date, validity will not be given to the agreement.is essential that it should appear either in express See Harvey v. Pratt (1965) 2 All E.R. 786 C.A.

In order to have a valid agreement for a lease, it is essential that it should appear either in express terms or by reasonable inference from the language used in the instrument on what day the term is to commence. Indeed, both the commencement and the maximum duration of the term must be either certain or capable of being rendered certain before the lease takes effect. See Lace v. Chantler (1944) K.B. 305 at 306 – 307. As Lush L.J. Put it as early as in the case of Marshall v. Berridge (1881) 19 CH.D 233 at 245:- 
“There must be a certain beginning and a certain ending, otherwise it is not a perfect lease, and a contract for a lease must, in order to satisfy the Statute of Frauds, contain those elements”.
More recently in Harvey v. Pratt (supra) at 788, Lord Denning re-emphasised the above principle of law as follows:-
“It is settled beyond question that, in order for there to be a valid agreement for a lease, the essentials are that there shall be determined not only the parties, the property, the length of the term and the rent, but also the date of its commencement”.
Accordingly, though a lease may be limited to endure for any specific number of years, however many, it cannot validly be limited in perpetuity. See Sevenoaks, Maidstone and Tunbridge Railway Co. v. London, Chattam and Dover Railway Co. (1879) 11 Ch. D. 625 at 635-636. It must, however, be stressed that a term of years, although, it must be for a definite period in the sense that it must have a certain beginning and a certain ending, this does not necessarily mean that the parties must immediately fix the exact date of commencement of the instrument.
It has been recognised that it is properly open to the parties to agree that the lease shall begin upon the occurrence of an uncertain event, as for example, upon the declaration of war by Great Britain. See Swift v. Macbean (1942) 1 K.B. 375 or (1942) 1 ALL ER 126.

P.8

It has also been held that the parties may, quite validly, agree that the lease shall commence upon the occurrence of other uncertain event, such as “upon possession of the premises becoming vacant”. See Brilliant v. Michaels (1945) 1 All E.R. 121. Such as agreement, though at first conditional and dependent upon the occurrence of an uncertain event becomes absolute and enforceable as soon as the stipulated event occurs. See too Brilliant v. Michaels (supra) at page 126 and Cheshire and Burns Modern Law of Real Property by E.H. Burn (1982) 13th Edition, pages 368-369.

In this connection, attention must be drawn to the provisions of Section 37 of the Landlords and Tenants Law, Cap. 76, Revised Laws of Anambra State of Nigeria, 1991 which deal with the essential requirements of the class of contract, such as the one in issue in the present case. Section 37(1) of this Law which reenacts a statement of the general law provides that a sublease shall satisfy certain essential requirements, otherwise it shall be void. Section 37(1) (e) of that Law, in particular, provides as follows:-
“the term granted shall be sufficiently defined to be certain or ascertainable as regards its commencement and duration”.
There is also the provision of Section 37(2) of Cap. 76 (ibid) which stipulates thus:-
“A sublease may be created to commence on the occurrence of a contingent event”.
It is crystal clear that under Section 37(2) of the Landlords and Tenants Law, Cap. 76 of Anambra State, a sublease may validly be created to commence on the occurrence of a contingent event as in Exhibit 1. More importantly is the provision of Section 37(3) of the same law which stipulates as follows:-
“A thing shall not be regarded as omitted or uncertain in a sublease if the sublease contains sufficient facts or materials from which it can reasonably be supplied or ascertained”.
Applying all the above principles of law to the facts of this case, it is not in dispute that under Exhibit 1, the appellant demised unto the respondent and his late brother all that piece or parcel of land known as and called No. 30, Old Market Road, Onitsha:-
“To hold the same unto the Lessees for a term of 50(fifty) years from the date the lessees are issued with a Certificate of Occupancy in respect of the whole building or any part thereof ”
There can be no doubt that the parties under Exhibit 1 did not pretend to have

P.9

immediately fixed the exact date of commencement of the lease. All they did, and quite rightly in my view, was to agree that the lease shall begin to run upon the occurrence of an event, in this case, from the date certificate of occupancy in respect of the building is issued by the Onitsha Local Government. It is clear to me that the date of commencement of the term of the lease was conditional upon the issuance of certificate of occupancy in respect of the building that is the subject matter of the lease. It is equally plain that the law does permit parties to enter into such agreements notwithstanding the fact that their commencement dates are dependent upon the occurrence of some uncertain future event. However, such conditional agreements, as I have stated, became absolute and enforceable the moment the event in question occurs.

So in United Bank for Africa Ltd. v. Tejumola and Sons Ltd. (1988)2 NWLR (Pt.79) 662 and 686, this court per Obaseki, JSC explained this aspect of the law very succinctly as follows:-
“It is settled by authorities that where a contract is subject to the happening of a contingency, that contract only becomes enforceable provided the event has occurred or the contingency has happened. Where a date for the commencement of a lease is not specified but stated by reference to the happening of a contingency which is uncertain in time, until the contingency happens, there is no enforceable lease.”
In the present case, it is the evidence of the appellant that after the respondent had completed the ground and first floors of the building in issue, the said appellant in 1976 added a second floor to the structure erected by the respondent. The said 2nd floor was not completed until in the same 1976 when the appellant moved therein. It is crystal clear that since the appellant was still building the second floor of the house early in 1976, the issuance of a certificate of occupancy in respect of the premises by the Onitsha Local Government could not possibly have taken place before then. It was on the completion of the said second floor by the appellant that he obtained the certificate of occupancy in respect of the building on the 7th day of July, 1976. This certificate of occupancy is Exhibit 7. It is my view that the date for the commencement of the lease having been stated by reference to the happening of a contingency which was uncertain in point of time, the term of the lease, Exhibit 1, began to run as soon as Exhibit 7, the Certificate of Occupancy in respect of the building was issued. In other words, Exhibit 1 fully matured to an enforceable lease on the 7th day of July, 1976 on which date the said Certificate of Occupancy was issued by the Onitsha Local

P.10

Government. I think that the court below cannot be faulted in its finding that the commencement of the lease, Exhibit 1, was with effect from the 7th July, 1976 on which date certificate of occupancy in respect of the premises was granted by the Onitsha Local Government.
I should, perhaps, stress that there is ample evidence on record in support of the above finding of the court below. In the first place, the appellant himself testified that he went into occupation of his room/store on the ground floor and flat on the first floor of the building in 1976 and that he let the same out to one Adimora about March or April of that year. In the second place the appellant also admitted that in 1976 the respondent paid him the reserved rent under Exhibit 1 for five years in advance for the period 1976 to 1981.

It seems to me that both parties could not have been under any illusion on the basic fact that the term of the lease Exhibit 1, commenced to run from 1976 as rightly found by the Court of Appeal.
But the appellant then argued that the lease had not commenced to run merely because it was not the respondent himself that was issued with the certificate of occupancy, Exhibit 7, pursuant to the stipulation in the leasehold agreement. I think it is a matter of common knowledge, if not notoriety, that at the conclusion of the erection of any new building in the Onitsha Local Government Area, the same may not be moved into or occupied until it has been duly inspected by the Local Government officials and certified to be in accordance with the specifications in the approved building plan and that the same is therefore fit for human habitation. The certificate is always issued in the name of the owner of such a new building. It is an authorisation or permit under the Council’s bye-laws that the building is fit for human occupation and it does not seem to me to be any matter of great moment whether it is a lessor, a lessee or, indeed, anyone else that is issued with the relevant certification. I agree entirely with the submission of learned counsel for the respondent that it is, with respect, sheer pedantry on the part of the appellant to argue, as he did in his brief of argument, that the term of the lease in Exhibit 1 had not commenced to run merely because it was not the respondent himself to whom the certificate of occupancy, Exhibit 7, was issued. I am satisfied that the lease, Exhibit 1, is valid and enforceable in law. Issue 1 is accordingly resolved in favour of the respondent.
The second or subsidiary issue poses the question whether even if the building lease, Exhibit 1, is void, and I clearly do not so hold, this ipso facto deprives the respondent of all rights in and over the property known as and called No. 30, Old Market Road, Onitsha. In this regard, the principle of law is

P.11

well established that where a person has expended money on the land of another in the expectation, induced or encouraged, by the owner of the land that he would be allowed to remain in occupation thereof, an equity was created such that the court would protect his occupation of the land and the court has power to determine in what way the equity so arising could be satisfied. See Ibadan City Council v. Ajanaku (1969) NSCC 44 at 49. In that case the contention was that a lease which stipulated that a party to the agreement would occupy the land “for as long as he shall occupy the same” was void for uncertainty on the ground that it was for an indefinite term. Reliance was placed on the decision in Lace v. Chantler (1944) K.B. 368 in support of this contention.

This court held that the equity arising from the expenditure of money by the lessee would be satisfied by allowing the plaintiff and his successors to remain on the land for an indefinite period free of rent as agreed upon in the lease contended to be void. See too Inwards v. Baker (1965) 2 W.L.R. 212 where in similar circumstances, Lord Denning, quite rightly in my view, observed as follows:-
“So, in this case, even though there is no building contract to grant any particular interest to the licensee, nevertheless the court can look at the circumstances and see whether there is an equity arising out of the expenditure of money”.
The noble Lord then continued:-
“All that is necessary is that the licensee should at the request or with the encouragement of the landlord have spent the money in the expectation of being allowed to stay there. If so, the court will not allow the expectation to be defeated where it will be inequitable to do so ….”
In the present case, it is not in dispute that the respondent with the agreement and concurrence of the appellant expended his own money in the erection of the ground and the first floors of the house in issue in the expectation that he would remain in occupation of the appellant’s said property for a term of 50 years. It is also common ground that the said appellant duly moved into his own sections of the building as agreed under Exhibit 1. I cannot but agree with the submission of learned counsel for the respondent that the court, in the circumstances, is bound to protect the equity created in favour of the respondent so that the same would not be unduly frustrated or defeated. Issue 2 must again be resolved in favour of the respondent.
It is for the above and the more detailed reasons contained in the leading judgment of my learned brother, Belgore, JSC, that I, too, dismiss this appeal with costs as therein assessed.
P.12