- F.M.B. Plc v. Babatunde
- ₦ 200
F.M.B. Plc v. Babatunde
FEDERAL MORTGAGE BANK (NIGERIA) PLC.
DR. ELISHA BAMIDELE BABATUNDE
COURT OF APPEAL
( ILORIN DIVISION )
MURITALA AREMU OKUNOLA, J.C.A. ( Presided )
PATRICK IBE AMAIZU, J.C.A. ( Read the Leading Judgment )
WALTER SAMUEL N. ONNOGHEN, J.C.A
WEDNESDAY, 30TH JUNE, 1999
AUCTION - Notice of Sale by Auction - Notice less than 7 days - Validity of Notice - Section 19, Auctioneer’s Law of Northern Nigeria, Cap. 10
CONVEYANCING - Mortgages - Consent to Mortgage by Permanent Secretary without evidence of delegation of power by Governor of the State Validity of Mortgage - Sections 22 and 45, Land Use Act, 1978
LAND LAW - Mortgages - Consent to Mortgage - Absence of - Effect Section 22, Land Use Act, 1978
LAND LAW - Mortgages - Consent to Mortgage by Governor of a State under Section 22, Land Use Act, 1978 - Consent given by Permanent Secretary without evidence of delegation of powers under Section 45, Land Use Act, 1978 - Validity of Mortgage
- Whether the approval given to the Mortgage transaction between the appellant and its respondent by the Permanent Secretary Ministry of Works, Lands, Housing and Environment, Kwara State satisfies the provisions of Section 22, Land Use Act, 1978.
- Whether the consent of the Governor of Kwara State was sought and obtained to the mortgage transaction.
In 1983, the plaintiff (now respondent) took a loan of N45,000 from the 1st defendant (now appellant) with which to erect a house. In order to secure the loan, the respondent deposited the title deeds of his property at No. 9 Cemetery Road, G.R.A., Ilorin with the appellant Bank. On the 1st day of December, 1983, the respondent executed a deed of mortgage in respect of the property. In accordance with the Land Use Act, 1978, there was an approval to the mortgage transaction between the appellant and the respondent. This approval was conveyed by letter dated 31st August, 1982 reference No. LAN/ARO/RES/282/33 and signed by the Permanent Secretary, Ministry of Works, Land, Housing and Environment.
When the respondent defaulted in making the instalmental payment as provided in the mortgage deed, the appellant secured the service of an auctioneer (the 2nd defendant) to dispose of the mortgage property, that is, No. 9, Cemetery Road, G.R.A., Ilorin, in order to satisfy the indebtedness. The auction sale was conducted by the auctioneer on the 8th July, 1991 , after issuing and serving a public notice to that effect on 6th July, 1991 . There was a publication to that effect similarly in the Herald Newspaper of 6th July, 1991. The 3rd defendant in the suit in the High Court was the highest bidder at the said auction sale and so bought the property.
The present respondent now brought an action against the appellant, the auctioneer and the purchaser of his building as 1st, 2nd and 3rd Defendants respectively claiming a declaration that he is still entitled to the Right of Occupancy of Plot 9, Cemetery Road, Ilorin and that the 3rd defendant is not entitled to that Right of Occupancy; a declaration that the mortgage deed dated 1st December, 1983 by virtue of which the 1st and 2nd Defendants auctioned his building on Plot 9 Cementry Road, G.R.A. Ilorin is null and void; a declaration that notice or sale of auction of his said building by the 1st and 2nd defendants as contained on page 15 of the Herald Newspapers of 6th July, 1991 and that pasted on the building on 6th July, 1991 is null and void and an injunction restraining the defendants from ejecting him from the building.
The learned trial judge gave judgment for the respondent.
The appellant appealed to the Court of Appeal.
The following provisions of the Law were considered:
Sections 22 and 45 of the Land Use Act, 1978 which provide:
“22. It shall not be lawful for the holder of a statutory right of occupancy granted by the Military Governor to alienate his right of occupancy or part thereof by assignment, mortgage, transfer or possession, sublease or otherwise howsoever without the consent of the Military Governor first had and obtained ...”
“45. The Military Governor may delegate to the State Commissioner all or any of the powers conferred on the Military Governor by this Decree, subject to such restrictions, conditions and qualifications, not being inconsistent, with the provision or general intendment of this Decree as the Military Governor may specify.”
Section 19, Auctioneer’s Law, Laws of Northern Nigeria 1963 Vol. 1
“19. No sale by auction of any land shall take place until after at least seven days public notice thereof made at principal town, ...”