MRS. AISHA ABDURAHMAN & ANOR V. MRS. SHADE THOMAS (2019)

Background

This appeal concerned a tenancy agreement relating to a property at No. 51B, Bishop Oluwole Street, Victoria Island, Lagos. The appellants agreed to take the property for a two-year term at an annual rent of N2,000,000, making a total payment of N4,000,000 in advance. The tenancy period ran from approximately February 2004 to January or February 2006, depending on the relevant calculation in the evidence. The first appellant was intended to occupy the premises and initially took possession.

After being appointed Executive Director of the Petroleum and Pipeline Management Company, the first appellant became entitled to official accommodation and was provided with alternative accommodation in Victoria Island. She consequently informed the respondent that she would not continue to occupy the rented property and requested a refund of the advance rent. The appellants returned the keys to an agent of the respondent and argued that the tenancy agreement had thereby been rescinded, entitling them to recover the entire N4,000,000.

The respondent disputed that the tenancy had been mutually rescinded. She maintained that the arrangement merely permitted the appellants to receive the rent attributable to the unexpired period after the premises was re-let. The property was eventually re-let, and the respondent offered the appellants N560,000, representing rent for the remaining period calculated from November 2005. The appellants rejected the offer and commenced proceedings at the High Court of Lagos State for the full N4,000,000, together with interest and solicitors’ fees.

The trial court found that the appellants had not established any mutual rescission or subsequent agreement requiring repayment of the entire rent. It held that the original tenancy had been varied in practical operation and that the appellants were entitled only to rent for the unexpired period after the property was re-let. Their claim was dismissed because the sum offered and paid by the respondent represented the amount proved to be due. The Court of Appeal affirmed that decision.

Issues

1. Whether the Court of Appeal was right to hold that the tenancy agreement was not completely rescinded but was varied, so that the appellants were entitled only to a refund of rent for the unexpired term from the date the property was re-let.
2. Whether evidence elicited from the respondent during cross-examination, concerning the date on which the property was re-let, was admissible and properly relied upon despite an apparent difference between the pleadings and the oral evidence.

Ratio Decidendi

The Supreme Court dismissed the appeal and affirmed the concurrent decisions of the two lower courts. The Court emphasised that an appeal on questions of fact generally requires leave under section 233(2) of the Constitution of the Federal Republic of Nigeria 1999. The appellants’ complaints substantially invited the Supreme Court to conduct a third evaluation of the evidence, but no sufficient basis was shown for exercising that exceptional jurisdiction.

Concurrent findings of fact by the trial court and the Court of Appeal are presumed correct and will not ordinarily be disturbed unless they are shown to be perverse, unsupported by evidence, or productive of a miscarriage of justice. The Court held that the appellants had not displaced that presumption. A finding not challenged by a party on appeal remains binding and cannot properly be reopened by the appellate court.

The Court further held that the return of the keys did not, by itself, amount to rescission of the tenancy agreement. Likewise, a tenant cannot unilaterally terminate a tenancy contract and automatically convert that termination into a mutually agreed rescission. Rescission required proof of a subsequent agreement, written or otherwise, which was inconsistent with and intended to replace the original contract. The appellants failed to prove such an agreement.

Evidence obtained during cross-examination is not inadmissible merely because it appears to differ from a pleading. Where the evidence is relevant to a fact in issue, constitutes an admission against interest, or explains an apparent ambiguity in the pleadings or earlier testimony, it is admissible. The respondent explained that although the property was not finally occupied by the new tenant until February 2006, rent had been paid from November 2005. That explanation was accepted by both lower courts.

Court Findings

The Supreme Court accepted that the landlord-tenant relationship was contractual and governed primarily by the written tenancy agreement. The appellants had paid the rent and obtained possession, thereby substantially performing the original contract. Their later decision not to remain in the premises resulted from their own change of circumstances, not from any breach or frustration by the respondent.

The Court considered it unreasonable for a tenant who had taken possession and later secured alternative accommodation to demand a full refund of advance rent. In the ordinary course, where a tenant voluntarily surrenders possession after execution of the tenancy contract, the tenant may receive rent for the unexpired period from the date the premises is re-let. There is no automatic entitlement to a refund of the entire advance rent. The respondent’s payment of N560,000 was therefore consistent with the factual findings and the applicable landlord-and-tenant principle.

The Court also observed that the tenancy agreement contained a covenant restricting assignment, underletting or parting with possession without the written consent of the sublessor. The agent who received the keys was not himself a party to the tenancy agreement, and there was no proof that the respondent authorised or accepted a surrender capable of terminating the agreement. Consequently, the appellants could not rely solely on their dealings with the agent to bind the respondent.

Conclusion

The appeal was dismissed in its entirety for want of merit. The judgment of the Court of Appeal in appeal No. CA/942/2010, delivered on 14 May 2012, was affirmed. The appellants were ordered to pay costs of N500,000 to the respondent, jointly and/or severally.

Significance

The decision clarifies that a tenant’s unilateral decision to vacate leased premises does not ordinarily rescind the tenancy or entitle the tenant to recover all advance rent. It also reinforces the Supreme Court’s restraint in disturbing concurrent findings of fact and confirms that unchallenged findings remain binding. In addition, the case illustrates that evidence elicited under cross-examination may be relied upon where it is relevant and explains an apparent inconsistency in the pleadings.