The respondent company is a limited liability company incorporated in Nigeria in 1969. It was engaged in construction business and it had five directors including Chief Omunakwe Nyeche Nsirim, the founder, his wife Mrs. Maureen Nsirim, his son Ndamzi Nsirim and Nyechi Nsirim and his nephew - Etchsen Nsirim who is the appellant in this case. Apart from being a director, he was also the plant manager of the respondent company on a monthly salary of N500.00. At the time dispute arose, he was carrying on a block moulding business under a firm name of Etchsen and Sons block moulding industry.

In March, 1980 a meeting of the Board of Directors of the respondent company was held. Four of the directors including the Managing Director (P.W.3) and the appellant were present. It was decided and agreed at the meeting that the respondent should establish a block moulding industry to reduce the cost of buying blocks for its construction work; that the industry should be temporarily sited on a piece of land at Mile 4 Omunakwe Road belonging to the Managing Director (P.W.3). The appellant was to be in charge of both the purchase of the machinery and the management of the industry and was to render account of the proceeds of the business to the respondent. The machinery and equipment for the business was to be purchase from Weidemann and Walters (Nig.) Ltd. and the appellant was directed to negotiate for the purchase.

The appellant made the necessary contact and told P.W.3 that the required machinery and equipment would cost N98,000.00. On 13/4/80, the respondent issued a cheque drawn on its Pan African Bank Ltd. for the sum of N49,000.00 in favour of Messrs Weidemann and Walters (Nig.) Ltd as a deposit or part payment. On 1st July, 1980, the respondent also issued another cheque drawn on its said bank for the same amount and in favour of Messr Weidemann and Walters (Nig.) Ltd. The appellant paid for and took delivery of the machinery. It is the respondent's case that thereafter, the P.W.3 travelled to the United Kingdom and on his return, he observed that the industry had gone into production. He demanded from the appellant the purchase receipt for the machinery but he declined to produce them. The respondent wrote to Messrs Weidemann and Walters (Nig.) Ltd and from the copies of the receipts Exhibits A and B received from it, it was discovered that they were made in the name of the appellant's business name. It was also discovered from the signboard mounted at the side of the industry that the appellant was running the industry in his firm name Etcheson and Sons block moulding industry. The appellant was asked to change the name of the business to that of the respondent company and to render account of the business and when he failed to cooperate, the respondent went to court. In his defence, the appellant asserted that he started negotiations to open a block moulding industry with Messrs Weidemann and Walters (Nig.) Ltd. in the year 1978 and that his firm name was registered with the Rivers State Government in 1979. It was his case that the sums paid over to Messrs Weidemann and Walters (Nig.) Ltd. represented his accrued or cumulative allowance which he invested in a block moulding industry and that the amount was only a proportion of the total cost he incurred in establishing the business. To impeach his credit, a certified record of his evidence when this case was heard before another Judge was tendered as Exh.X. Also tendered as Exh.Y was his statement of defence in another suit between the same parties. His statements in both Exhibits X and Y were materially different from his evidence in the proceedings in this case.

At the close of the trial, the learned trial Judge held that the respondent company had not satisfactorily proved its case and also that the appellant failed to prove his and consequently non-suited the respondent.

Both parties were dissatisfied with judgment. The appellants appeal was based on the ground that the proper order which the trial court should have made was that of dismissal.