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CaseLaw

Ejikeme V. Okonkwo (1994) CLR 11(e) SC

Brief

  • Equity of redemption,
  • Deed of mortgage,
  • Mortgage agreement

Facts

In 1966 Lawrence Okonkwo and Samuel Okonkwo (both now deceased) borrowed from Edwin O.C. Ejikeme (the appellant) the sum of 3,700.00 pounds with which they developed a property at 31 weka Road Onitsha. They all agreed under seal and it was registered in the Lands Registry office at Enugu.

The lender by virtue of the agreement was being paid by the borrowers half the rent they were collecting from tenants in the house. The borrowers died during the civil war and Veronica Okonkwo and Ndubisi Okonkwo wife and son respectively of Lawrence Okonkwo took out letters of administration with one other person Elizer Okonkwo in respect of the estate of Lawrence Okonkwo. In 1982 by a letter dated 19th May and addressed to the appellant. Veronica gave notice of her intention to pay off all the outstanding balance of the loan plus interest due thereon as at 20th June, 1982.

Ejikeme replied through his solicitor that he would insist on his rights under the agreement, that is he would continue to collect 50% of the rent accruing from the property for 35 years as stipulated in the agreement. He refused to accept the offer made by Veronica Okonkwo. Thereupon, Veronica refused to share the rent with Ejikeme who them instituted the action leading to this appeal claiming as per paragraph 10 of the Statement of Claim against Veronica and Ndubisi as hereunder;

  • 1
    A declaration that the plaintiff is entitled to fifty percent of all the rents collected from the house known as and called No 3 Iweka Road Onitsha for a period of thirty five years from 1st day of July, 1966.
  • 2
    A perpetual injunction retraining the defendants either by themselves, their servant or agents from collecting rents on the said house to the exclusion of the plaintiff..
  • 3
    An account of all the money collected by t he defendants in respect of he house from the 19th day of December, 1983 up to date of the judgment.
  • 4
    AN ORDER of this Honourable Court setting aside its order of 31st May, 2012 granting leave to the complainant/Respondent to prefer charge No. FCT/HC/CR/92/12 against the Accused/Applicant.

Pleadings having been filed and exchanged he defendants in their statement of Defence and counter claim claimed as follows

  • (a)
    A declaration that the purported mortgage dated the 26th day of May 1966 made between the plaintiff and late Mr. Lawrence Okonkwo, Samuel Okonkwo and registered as No 27 at page 27 in Volume 448 of the Lands Registry Enugu is void.

    • Alternatively

    • (b)
      An order setting aside the said deed of mortgage

      • The plaintiff did not file a defence to the counter claim. The action proceeded to trial. On the date fixed for the trial however, learned counsel for both parties informed the court that they had settled issues and that the only issue calling for determination was whether the agreement was valid or not. Both referred to the agreement as a mortgage and the case was fought on the premise that it was a mortgage. Learned counsel addressed the court. In his judgment the learned trial Judge dismissed plaintiff's claims and allowed the defendants counter claim. He ordered as follows:-

      • 1
        The covenant not to redeem until 35 years has elapsed is irregular, a clog on the mortgage and cannot stand. The defendant is therefore entitled to an immediate right of redemption in this case.
      • 2
        The Mortgagee is entitled to the payment of his principal interest and costs only. This in concrete terms means that the mortgagee is entitled to the repayment of the sum of N7,400.00 plus compound interest of 9% till the mortgaged property is redeemed.

        • Being dissatisfied with this judgment the plaintiff appealed to the court of Appeal which latter court dismissed the appeal and affirmed the judgment of the trial High court.

Issues

  • Whether the agreement between the appellant and he borrowers (the...
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