Course: LAW FOR ENGINEERS

QTYS 421

2015/2016 SESSION

Code:

DEFINITION & FEATURES OF LAW

Law is a difficult concept to define and attempts at definition are often a description of what
law does in a given society.
Law may be defined as a rule of action consisting of a body of rules designed or formulated
to guide and regulate human behaviour in any given society.
Law is the enforceable body of rules that govern any society.
Law can also be defined as a rule or body of rules made by institutions, bodies and persons
vested with the power to make such rules which are binding and enforced among the
members of a given state or society.
Only law so created can be said to be legally binding upon the individual or even upon the
state itself.
Why do we need laws?
Even in the most primitive of societies, people live their lives by rules which they create.
Such rules are imposed to make people behave in a similar way in order to provide a
harmonious way of life. Therefore, we need laws to prevent chaos in achieving this.
There are basic features and characteristics that are universal of law:

Law consists of a body of rules, written or unwritten.

The set of rules are usually designed to regulate human conduct. It is normative in
character i.e. it states what people ought to do and prescribes norms of conduct often
influenced by societal values such as bigamy, corruption etc.
Law is man-made. Laws are adopted by the society to govern itself and since it is
man-made, man has the responsibility to determine to a large extent the content of the
law of his society. Many factors including religion, morality, customs and sociopolitical development of a society usually have some bearing on the selection of the
laws by which a society is governed by however, such values or rules are not laws
unless they are traceable to the institutional sources such as the Constitution, statute,
case law, delegated legislation among others.
The main setting for the operation of law is the society and it is binding on members
of the society. Nobody is above the law and no one can claim exception to the law
except in areas of constitutional immunity granted to certain officials (Such person
shall not be arrested or imprisoned either in pursuance of any court requiring or
compelling his appearance shall be applied for or issues. Diplomatic Immunity and
Privileges Act. Section 308 of CFRN 1999). Laws are usually made to guide the
conduct of the people of a particular society or territory and are binding on the people
within that society or territory (territorial limitation).
Once law is made, it is meant to be obeyed (enforceable by authority)
There is usually a reproach or sanction for any act of violation or defiance

Law is certain. It differs fundamentally from morals (human behaviour based on the
notion of what is right or wrong and what is good or bad in a circumstance).
Law is dynamic in nature. Since it is meant to regulate the behaviour of man in the
society, the content of the law of each society usually changes as the social, political
and economic world in which he lives changes.

Ability to enforce the law is the main distinction between law and morality. Unlike the rules
of law which are officially enforced, the only sanction for a breach of the rules of morality is
the anger, repulsion, indignation and surprise which might be expressed by members of the
society. For example: acts such as adultery, homo-sexualism and lesbianism are moral
wrongs; murder and rape are both moral as well as legal wrongs.
The law and the engineer
At work, the engineer is even surrounded continually with the need to comply with legal
requirements. Before he can erect a structure he may have to buy land. He may enter into a
contract to erect the structure on someones land and will have to enter into tens or hundreds
of contracts to buy all the necessary materials locally and/or internationally. He must make
sure that he has planning permission and must deposit plans which satisfy the building
/construction/engineering regulations. He will have to enter into contracts of employment
with his workers and may negotiate with trade unions. He may operate his business as a sole
trader/proprietor or in partnership or may form a limited company. He must execute the
project carefully to comply with the contract specifications, the construction Regulations, the
Health and Safety at Work Act and to avoid being sued for breach of contract or negligence.
He must not cause nuisances to his neighbours or the community while erecting or executing
the project. He must not trespass on the neighbours land, build beyond building lines, cause
obstructions of highways/traffic nor dismiss his workers without good reason. The list is
endless.
FUNCTIONS OF LAW IN THE SOCIETY

Law serves as a means of maintaining law and order in the society. Deviant behaviour
is suppressed and culprits are apprehended and dealt with according.

Law confers rights and imposes obligations as well as duties on the citizens and the
government. Law recognises basic underlying interests and provides a framework of
rules for giving effect to them. (Recognition of a persons right to freedom and
protection; systems for transfer and inheritance of property).

Law constitutes and regulates the principal organs of power. It establishes or

recognises specific institutions, body of persons and individuals and vests in them
with authority to exercise certain powers on behalf of the State or institutions. It
regulates procedures and ensures the smooth ordering of the affairs of the society.
(Identification and allocation of official authority).

Law communicates and reinforces social values and guides human behaviour within
the society (definition and regulation of social relationships).

Law is a means of maintaining unity among varied interests in the society and also a
means of promoting economic and political development.

Law provides a means of reconciling conflicting interest. It establishes a formal

mechanism for settlement of disputes. (Dispute settlement and remedies).

It is a means of social cleansing of vices such as armed robbery, drug trafficking,

advance-fee fraud, money laundering etc.

Change of law: law is dynamic and the content of law of any society is the product of
the prevailing social, political, economic and cultural conditions at a particular time.
Invariably, changes in the prevailing conditions sometimes affect the substance of the
law in the society. The law must establish the procedure for changing the old rules and
provisions of the law. Section 9 of the 1999 Constitution contains provisions on the
procedure for amending the Constitution while Section 58 contains provisions for
making new legislation.

LAW, MORALS AND RELIGION

Every society has rules and regulations binding on its peoples quite a number of which are
based on some basic moral values. For example, customary law is blended by morality of the
people coupled with the belief in God (ancient people believed in existence of many gods).
Customary law therefore consists of law, morality and religion. Morality is the code of
beliefs, values, principles and standards of behaviour, some versions of which are found in all
social groups. It can also be defined as the principles concerning rights and wrong or good
and bad behaviour. Morality is the ultimate principle and criterion whereby social behaviour
is judged and law is considered to be most effective when it conforms to the moral feelings of
the members of the community.
Religion teaches people what is good or bad and it directly influences the inner spiritual
being of the people. Religion and morality assert that doing a thing is bad without proffering
any reasons for its being bad. On the other hand law is not premised on moral adulation or
religious injunction but is rather an authority and command which should be obeyed, just or
unjust. To a certain extent, law contains some morals and religious elements.
Another distinction is in the area of sanctions. In religion, the sanction is fear of suffering in
hell. While in morality, the sanction takes the form of reprobation, repulsion and ostracism.

THE CONCEPT OF JUSTICE AND THE RULE OF LAW

There can be no understanding of the meaning or purpose of law without relating its goal to
the attainment of justice. Justice is all about the fair application of any legal rules and
procedure and great emphasis is placed on fair hearing and the principle of natural justice.
Justice also is the fair and reasonable distribution of obligations and opportunities in the
society. To this end, law is expected to be fair and reasonable in content.

The rule of law presupposes that all things within a given society should be done according to
laid down procedures as against arbitrary actions of certain individuals or groups. This is the
due process of law which consists of such matters as judicial independence, availability of
facilities to try accused persons, safeguards for fundamental human rights.
Types of Law:

Eternal law: something that has always existed has never changed and will always
exist. Hence, eternal laws are laws that are constant, everlasting and universal. Eternal
laws comprise of God-given rules governing all creation which operate impartially to
all persons whether kings or servants.

Divine law: is Law of God or law from God e.g. the Bible or Quran. Divine law is
based on the premise that man is incapable of making a valid and just law because he
is sinful in nature. Hence, man must turn to God who is the governing authority of the
Universe for perfect law.

Natural law: means the law of nature. It is that which accounts for the behaviour of
creatures generally, whether human beings, animals and plants. For instance, plants
under given circumstances behave in a particular way and it is the law of nature which
makes us sleep, angry, hungry or laugh; the law of planetary motion; the law of
gravitation; the law of relativity which describes the regularity and uniformity with
which thing happen under certain conditions are also laws of nature.

Human or positive law: this is in contra-distinction to natural law which is the law of
God. The school of thought on positive law is called legal positivism and it asserts
that law is posited and laid down by an authority of the society which provides its sole
source of validity. Legal positivism does not concern itself with morality or ethical
precepts.

SOURCES OF THE NIGERIAN LAW

Relevance of the studying the sources of Law:

To understand various means by which law is made; through which it came into
existence

To understand the process by which law derives its validity

To understand historical factors which have influenced the evolution of law.

The Nigerian Legislations and Statutes: This consists of statutes and subsidiary
legislations. Statutes are laws made by the legislature or body so duly constituted and
authorised to enact laws while subsidiary legislations are laws so enacted in exercise of
the powers given by main statutes. Subsidiary legislations are also known as delegated
legislations or statutory instruments and are usually entrusted to Ministers or
Commissioners. The Nigerian legislation consists of Ordinances, Acts, Laws, Decrees
and Edicts depending on the status of the issuing body or the circumstances of the
prevailing political situation. Subsidiary legislation is law enacted under the powers

conferred by a statute. Another name for subsidiary legislation is delegated legislation

e.g. bye-laws of local governments, regulations of public corporations, statutory
instruments of ministers etc.
ORDINANCES: these were laws passed by the Legislative body during the colonial
era. In most cases, such enactments were usually in the form of orders from the
mother-countrys parliament and were deemed to be applicable to the colonies
concerned. These were laws made by the central and regional legislature in Nigeria
before the introduction of the Federal Constitution on 1st October 1954.
ACT: An Act is usually the end product of the process of passing a Bill into law in
Parliament. A bill is a proposed law and it necessarily has to pass through prescribed
procedural stages before becoming law by receiving the Presidents signature, then it
becomes an Act of Parliament. In the 1999 Constitution, the prescribed law making
authority is the National Assembly while the President signs the Bill into an Act. An
Act of Parliament is binding throughout the territory of that country. Under the
Inconsistency Rule in the 1999 Constitution, an Act of the National Assembly is
supreme. Where the laws of a State Assembly is in conflict with the Acts of the
National Assembly, such laws would be deemed to be null and void and therefore
ineffective to the extent of their inconsistencies.
DECREE: A Decree is the equivalence of an Act. It is an authoritative order passed
down by the ruling military administration for the governance of the people. Usually,
there is always a competent body so set with the task of giving laws during a military
rule. Unlike the Acts of Parliament, decrees are not subject to procedural bottle-necks
including their amendment, repealing or abrogation processes. However, unlike the
Acts of Parliament, decrees are more prone to having some ouster clauses which are
aimed at eliminating intervention of the courts, by way of adjudication or
interpretation.
LAWS: Laws are simply enactments of the States Assemblies during a civilian
regime. They undergo similar legislative processes as in the National Assembly, i.e.
from a bill through the House of Assembly and finally to Law after having been duly
signed by the Governor of that state. A law is applicable only in the territory of that
State unlike an Act of Parliament.
EDICTS: Edicts are laws of the military administrators in the States. They are issued
by the States Executive Council and can only become effective after receiving the
military Governors signature. Edicts of the States are also subject to the
inconsistency rule prevalent in the civilian regime while edicts are also applicable
only to the States concerned by the provisions.
BYE-LAWS: are rules and regulations made by the Local Government for the
governance of their areas of jurisdiction.

The Received English Law: The English statutes which were co-opted into the Nigerian
legal system constituted and still, by inference, constitute major source of the Nigerian
law today. The reception of English laws into Nigeria was in two broad forms. First,

there were those which were made applicable and enforceable in Nigeria directly (laws
emanating from British Parliament were applicable and enforceable in the colony); and
secondly, there were those which were received into the country by various local
legislatures (separate legislature established to make laws for the place as and when
necessary. It was the 1960 independence that put an end of the applicability of English
laws in Nigeria, the Nigerian Independence Act, which was itself, a British enactment
applying to Nigeria, among many other fundamental provisions, empowered the
Nigerian legislatures to abrogate or amen any enactment of the British Parliament
which were formerly applicable to Nigeria. Most of these statues have since been
repealed, amended or replaced by local equivalents. The Received English Law
comprise of:

The Common Law: The term common law simply means the law that was
common to all England including Wales and distinguished from mere local
laws based on local customs and which was developed by the old common law
courts. The Common law was characteristically rigid and highly technical in
application and its general administration was fraught with obvious injustices,
hence the development of equity by the Court of Chancery as means of
mitigating the harshness of common law

The Doctrines of Equity: Equity simply means fairness and it developed as a

form of appeal (on the decision based on Common law), to the Kings
conscience. It is a case law system administered by the Lord Chancellor to
grant relief to an aggrieved party whose complaint of injustice arising from the
administration of common law rules had been heard and upheld.
Equity does not operate in isolation. It is always based on the rules of common
law which act directly on person, actions and things. Its role is also essentially
complementary. Most importantly, it grants to the judges the right to use
discretion in waiving the technicalities of law or rules that could have resulted
in gross injustice. Equity operates through a number of universally
acknowledged maxims some of which include:

Equity would not act in vain

He who comes into equity must come with clean hands
Delay defeats equity
Equity follows the law
Equity will not suffer a wrong to be without a remedy
Where there is equal equity, the law shall prevail
Equity looks at the intent rather than the form
Equity acts in persona
Where the equities are equal, the first in time prevails
He who seeks equity must do equity
Equity looks on that as done which ought to be done
Equity imputes an intention to fulfil an obligation
Equality is equity

Statutes of general application of laws in force in England as at January 1,

1900: Pre-Independence legislation made applicable to Nigeria by extension.
Such English laws extending to Nigeria consist of statutes and subsidiary
legislation. Whereas most of these laws have since been repealed or amended
in England, serious efforts were just being made in Nigeria to review such
obsolete laws.

English Laws made prior to October 1, 1960 but are applicable to Nigeria.

Customary Law and Islamic Law

Customary law is the traditional law of the people in a given community. The law
regulates the affairs of such a society and with time and usage such set of rules
have become recognised and accepted as binding upon the adherents. As a source
of Nigerian law, customary law is generally taken as including Islamic law which
is applicable in the greater part of Northern Nigeria.
Customary law is not uniform nor is it universally applicable as such. It varies
from culture to culture and same with communities. Even within a community,
distinct variations might still be noticeable. Apart from being entrenched in the
customs and traditions of the people, customary law possesses certain unique
characteristics which distinguish it from other forms of law. First, it derives its
validity from acceptability by the community as an obligation that is binding upon
them. Customary law is characteristically unwritten. The amorphous body of rules
are left to the Obas, Chiefs and elders of the community to interpret as and when
occasions so demand. Modern trends have now required these laws to be written
down as definite statements or at least making the body of rules to appear in
prescriptive formats. Customary law is flexible, dynamic and ever changing in
response to circumstances and to changes in the society reflecting both social and
economic transformation.
Islamic law, on the other hand is essentially a divine law which derives its origin
from the Quran, the Holy Book. It is characteristically written and therefore rigid
and immutable. The various sources of Islamic law include the Ijima, which the
consensus of the Moslem scholars and Ulama, the Hadith or Sunna, the sayings of
the Holy Prophet and Qiyas which consist of analogies from the Quran and the
Sunna. The version of Islamic law practiced in parts of Northern Nigeria is the
Maliki Law. This aspect of the Islamic Law was formally introduced into the
Nigerian legal system in 1956 with the corresponding establishment of a network
of Alkali, Area Courts and the Sharia Court of Appeal. The Court of Resolution
was established to resolve possible conflict that might arise in the routine
dispensation of justice according to the provisions of the Maliki law and the
English law. Presently, the function of the Court of Resolution has since been
subsumed in the detailed jurisdiction of the Court of Appeal. The Sharia as the
Moslem law is commonly referred to, mainly governs the aspect of personal lives
of the people. Moslem believers submit to adjudication in the areas of Moslem

inheritance and succession, marriage, divorce and violation of various aspects of

the Quranic injunctions.

Judicial Precedent (or case law): as a source of law is essentially premised on case laws
the doctrine of binding precedent (Stare decisis, et non quieta movere standing by
past decision and not disturb things at rest). A court would normally declare a rule in
order to arrive at a decision and such a judgement remains a precedent for other judges
to follow for subsequent cases or similar to the earlier one. Precedents thus constitute
the bedrock upon which subsequent decision can be based for an expeditious
dispensation of justice. As a general rule, under the doctrine of precedent, decisions of
the superior courts are binding on the inferior courts.

International Law: Public International Law and those of Customary International Law
are a source of Nigerian law only to the extent that they have been adopted and ratified
by the Federal Government of Nigeria through its authorised law-making body such as
the Armed Forces Ruling Council in the case of a military regime or the National
Assembly during civilian era.

CLASSIFICATION OF LAW
Law can be classified in multifarious ways however these classifications overlap in real life.
Law can be classified into:

Public Law and Private Law

Civil Law and Criminal Law

Substantive and Procedural Law

Municipal or National or Domestic and International Law

Written and Unwritten Law

Common Law and Equity

PUBLIC LAW AND PRIVATE LAW: This aspect of law deals with the entire society and
everyone is affected by its application. It governs the relationship between the state and the
citizens hence the name Public law. Examples of Public Law include Criminal law,
Administrative law and Constitutional law. Public law embraces a legal relationship where
one of the parties (the State) is higher in legal status than the other (the citizens).
Private law deals with the rights and duties of individuals towards each other rather than
towards the state and covers subject areas as Law of Contract, Family law, Tort etc.
CIVIL AND CRIMINAL LAW: Civil law is the law governing conduct which is generally
not punishable by the state. Civil law means the law which defines the rights and duties of
persons to one another and provides a system whereby an individual who is injured by the
wrongful act of another can be compensated for the damage which he has suffered. Civil
wrongs have as their objectives the recovery of money and other property or the enforcement

of a right or advantage. Examples of civil law are the laws of contract and tort, family law
and property law.
Criminal law is the branch of law which seeks to protect the interest of the public at large by
punishing certain conducts which are believed to be harmful to the society to permit such
conducts to exist or continue. Criminal law is the law of crime. A crime or an offence is an act
or omission punishable by the State. Punishment is imposed generally by imprisonment or
fine or both. As a general rule an act or omission is not a criminal offence unless its definition
and the punishment for it are contained in a written law. Crimes are further classified into
serious crimes such as murder, rape, burglary etc. which are normally tried in the High Court
and lesser offences such as traffic offences, minor assaults, which are tried in the Magistrate
court. The entire Criminal Law has been codified in the form of the Criminal Code of the
Southern and the Penal Code of the Northern States.
Distinctions can be drawn with respect to the purpose and procedures for trying civil and
criminal cases. Criminal proceedings are instituted principally for the purpose of punishing
wrongdoers. Civil proceedings are taken mainly to enable persons to enforce their rights and
receive compensation for injuries caused to them by others. A crime is committed first and
foremost against the state therefore criminal proceedings are instituted and controlled by the
state although private persons may sometimes institute such proceedings. Civil proceedings
are usually taken by individuals but the state may be a party to a civil proceeding. Civil trials
involve an adversarial process in which both sides are treated equally; the alleged facts have
to be proved on the balance of probabilities. Criminal process is different: there is a
presumption of innocence and the standard of proof is higher proof beyond reasonable
doubt. The reason for this is that in a criminal trial, the liberty and sometimes the very life of
a person is at stake.
SUBSTANTIVE AND PROCEDURAL LAW: Substantive law means the rules of law
themselves. It means law in the strict use of the word or the body of legal rules. The legal
rights and duties of the citizens are defined for them in substantive law and they have no
choice but to obey the law as it is.
Procedural law (or Adjectival law) is that class of law which governs the method of bringing
judicial proceedings as well as the method of obtaining a remedy through such proceedings.
In other words, it is the procedural rules by which the substantive law is enforced in the
courts. The rule of procedural law therefore specifies the way in which an action is to be
initiated in court; the mode of proof; the manner of prosecution of evidence; the method of
giving evidence at trial; the examination of witnesses; the manner of giving judgement and
the enforcement of the judgement of the court.
MUNICIPAL OR NATIONAL OR DOMESTIC AND INTERNATIONAL LAW
The term Municipal can be used interchangeably with national, domestic or local law and it
denotes the internal law of a particular country. It embodies all the laws of a country that
regulate the relationship between the individuals and between the individual and the State.
International law on the other hand is the law which governs the relationship between the
States or between States and International Organisations. International law is divided into

Public International (rules regulating relationship among sovereign states) and Private
International Law (Conflict of Laws- deals mainly with the system of laws which should be
used in courts in cases which contain some foreign elements). Municipal law is simply the
law of a particular State.
WRITTEN AND UNWRITTEN LAW
Law may either be written and unwritten. Written law means a rule that has been formally
enacted into a legislation or statue by the legislature. Such laws, before their enactments are
usually subjected to rigorous debates and serious scrutiny through several stages before they
enacted and signed into law by the chief executive of the state. Written laws are usually found
in documents and can be said to be an assemblage of norms in one or more documents.
Written laws are called by different names in different jurisdictions and at various times.
They may be called Codes, Statutes, Acts, Decrees, Edicts, Laws, Rules or Ordinances.
The term unwritten law means any principle or rule of behaviour that is not written down at
all as in the case of Customary Law and conventions.
COMMON LAW AND EQUITY
Common law means the law developed by the Old Common Law Courts of England, namely
the Kings Bench, the Court of Common Pleas and the Court of Exchequer. The laws
developed over time as the Kings judges administered judgements based on the
customs/norms in their region with regular comparisons until in the course of time there
emerged a collection of uniform rules developed throughout the whole realm as the common
law of the realm. Hence, common law is judges-made laws which are to be found in prior
decided cases. Common law is strict, formal and full of legalism.
Owing to the injustice at Common Law, plaintiffs who failed to obtain redress through lack of
a remedy or ineffective remedy started sending petitions to the King to use his prerogative to
do justice and this over time developed into equitable jurisdiction of the Court.

THE ORGANISATION OF COURTS IN NIGERIA

The Nigerian court system is made up of a hierarchical formation. The English type of court
was a product of colonial administration, a consequence of the imposition of the received
English laws. The court systems can be categorised in various ways due to their varied nature,
mode of origin, powers, jurisdiction, status and competence. Classifications include:

Southern and Northern systems of courts each one possessing its own distinctive
peculiarities.

Inferior or superior courts depending on their competence.

Courts of first instance or appellate courts

Limited or unlimited in jurisdiction

Courts of record or not

However, whichever description or by whatever nomenclature the courts are referred to, the
common goal is always the dispensation of justice and the maintenance of peace and security
in the society. The reasons for the differences were primarily due to the religious, historical,
political and cultural differences between the north and south. The differences are more
apparent in the operations of the inferior courts namely the customary courts in the south and
the Native or Alkali and Area Courts in the north.

HIERARCHY OF COURTS
INFERIOR COURTS
Customary courts: are successors to the old native courts found in the southern parts of
Nigeria. They are the lowest courts in the hierarchy and are classed into grades A, B, C and D
as per their powers and jurisdiction. Appointments of judges of the customary courts vary
from states to states.
Generally, customary courts handle cases relating to the customs and traditions in the areas of
marriages, customary matrimonial causes, succession and inheritance and customary land
matters. Some also handle minor criminal justice matters such as traffic offences, local
Government Council offences and other grassroots misdemeanours. Such LG offences may
include violation of environmental sanitation regulations, touting at motor parks, rates
evasion and avoidance, illegal trading activities etc. Appeals normally go from customary
courts to the magistrate courts.
These courts interpret the laws based on the customs and culture of the people. It is the law of
the people, borne out of usage and acceptance. Proponents of the customary courts argue that
there are certain issues of domestic relations and traditional practices which are clearly
beyond the scope and competence of the English court systems; for instance, the traditional
beliefs in supernatural powers juju and other fetish sacrifices as well as the institutions of
marriage, divorce, family property and inheritance and succession based on the traditional
values and customs of the people.
Magistrates Courts: These categories of courts are uniformly spread all over the country
irrespective of the geographical dichotomy. Magistrate Courts are Courts of records presided
over in most cases by legally qualified personnel. The jurisdiction of the Magistrates by
grades only varies slightly from State to State. However, in northern states Magistrates
exercise criminal jurisdiction while in the south Magistrates have jurisdiction over both civil
and criminal offences. (In the north civil jurisdictions are handled by the District Courts).
District Courts: These have the same status as Magistrate courts. They exist only in the
north and exercise civil jurisdiction. The presiding Magistrates are referred to as District
judges. They exercise civil jurisdiction limited by monetary value and handle matters
involving personal suits, landlord and tenant, civil proceedings involving recovery of money,
land matters, appointment of guardianship of infants and granting of injunctions on several
subject matters of property, contracts or torts.

THE SUPERIOR COURTS

Customary Court of Appeal of a State: The establishment of a Customary Court of Appeal
in a State is provided for in the 1999 Constitution. Section 280 states that any State that
requires the court may proceed to establish it. The court essentially hears appeals from the
customary courts only in civil customary matters. The Customary Court exercises appellate
functions in addition to supervisory powers in civil matters over all the other cadres of
customary courts in the system. Appeals lay from the customary Court of Appeal of a State to
the Court of Appeal.
Sharia Court of Appeal of a State: Like the Customary Court of Appeal, the establishment
of a Sharia Court of Appeal by any State is also not mandatory but optional. The Sharia Court
of Appeal of a State administers the Islamic personal law as it relates to marriage, divorce,
inheritance and succession and guardianship of infants in their appellate jurisdictions. It also
exercises supervisory jurisdiction on the Area Courts.
Appeals from this court lay to the Court of Appeal. Also, the parties involved in any dispute
before the court must be Moslems and they must also have consented to be bound by its
jurisdiction. These include, any questions of Islamic law relating to marriage, its validity or
dissolutions, family relationship or the guardianships of infants; will or succession where the
donor is a Moslem; or any question of Islamic law regarding an infant, a prodigal or person of
unsound mind, who is a Moslem. The Sharia Court of Appeal of a State has no criminal
jurisdiction except in respect of contempt committed in the face of the court.
High Court of a State: Each State of the Federal Republic of Nigeria has a High Court
system which is established under section 270 of 1999 constitution. High Courts of states are
courts of unlimited jurisdiction in criminal and civil matters. Appeals lay from the High Court
to the Court of Appeal. Each of the states is divided into judicial divisions each being headed
by a High Court Judge. The Chief Judge of the State, at the apex of these judicial divisions,
exercises administrative control and supervision over the courts. The structure, organisation
and powers of the High Courts are provided for in the Constitution. The Chief Judge is
appointed by the Governor on the recommendation of the State Advisory Judicial Committee.
Federal High Court: Section 249 of the 1999 Constitution provides for the establishment of
a Federal High Court in each State of the Federation. Such areas upon which the Federal
High Court may adjudicate include revenue matters, customs, immigration, tax matters,
banking, foreign exchange, companies, copyright, patents, trademarks, admiralty and
shipping, bankruptcy and insolvency, aviation and safety, arms and ammunitions, drugs and
poison, mines and minerals, oil and gas and any other matters of direct concern to the Federal
Government and upon which the National Assembly can legislate.
The Federal High Court is composed of the Chief Judge of the Federal High Court and a
number of judges. Appointment is by the President of Nigeria through the Federal Advisory
Judicial Committee. Appeal from the decision of the Federal High Court also lay to the Court
of Appeal.
National Industrial Court: The establishment of this court was provided for in section 20 of
the Trade Disputes Act, No. 7 of 1976. It handles exclusively matters of industrial nature,

trade disputes and collective argument. Its powers in such matters are similar to those of the
High Court of a State or the Federal High Court. The Courts jurisdiction includes, among
others, adjudication in civil causes and matters:

Relating to

Labour, including trade unions and industrial relations,

Environment and conditions of work, health, safety and welfare of labour,

Relating to the grant of any order to retain anybody from taking part in any strike,
lock-out or any industrial action.

Relating to the interpretation of

Any collective agreement,

Any award made by an arbitral tribunal
The terms of settlement of any labour dispute or organisational dispute
Any trade union constitution, and
Any award or judgment of the Court.

The Court of Appeal: The establishment of the Court of Appeal is provided for in the 1999
Constitution and it serves as an intermediary between the High Court of a State, the Federal
High Court, the Customary Court of Appeal, and the Sharia Court of Appeal and the Supreme
Court.
The Court is composed of a President and not less than 49 justices as may be prescribed by an
Act of the National Assembly, of which not less than three shall be learned in Islamic Law
and not less than three in Customary Law. They shall be constituted by not less than three
Justices of Appeal. The court has original jurisdiction in section 239 only in Election
Petitions to the Presidency. It is essentially appellate in jurisdiction on civil and criminal
matters as well as fundamental human rights matters.
The Supreme Court of Nigeria: This is the final court to which appeal could be made in
Nigeria. The Court is essentially an appellate court in all civil and criminal matters
throughout the entire realm. It has original jurisdiction on matters conferred on it by law.
Such matters may include constitutional disputes as between the Federal Government and a
State or a group of States or matters of inter-state nature. It is the final court of Appeal. The
court is composed of the Chief Justice of the Nigeria and 15 other justices. The Chief Justice
of Nigeria is appointed by the President in his discretion subject to confirmation by a simple
majority of the Senate.

OTHER TYPES OF COURT

Juvenile Court: The court is specially established to handle exclusively cases in which
infants or young offenders are involved. The court is more of the Southern system of court
and it is established by the Children and Young Persons Law of each State. In the north, the
Magistrate court performs this function. The establishment of juvenile court is not punitive in
conception and in practice. It aims at the welfare, rehabilitation and protection of the young

offender being arraigned. The Lagos State Children and Young Persons Law defines a
Child as a person under 14 years while a Young Person is that who has attained 14 years
but still under the age of 17. Matters handled by the Juvenile Courts include criminal
offences, stubborn children, children needing care or protection, abandoned children, children
lacking parental supervision.
Special Military Tribunals: These are special courts established by decrees under the
military administration usually to handle special cases of social misdemeanour or societal
vices. Military tribunals were conceived as a complements to the existing court systems.
They are ad hoc in nature and operations. It is contended that they may save precious time
and exclude apparent delays, procedural hurdles and legal technicalities that are usually
characteristic of the normal courts.
Administrative Tribunals: These are also specially established bodies that perform judicial
and extra-judicial functions. Like the military tribunals, administrative tribunals are also
comparatively expeditious in their operations as they always set aside the tortuous rules of
procedure often associated with the ordinary courts. Administrative tribunals are essentially
fact-finding bodies set up by the executive arm of government to investigate circumstances
that have given rise to a situation that necessitated such a tribunal. Although the tribunals are
usually given specific terms of reference at the inception, the fact still remains that the
government may not accept the totality of their findings and recommendations in its own
White Paper.
Election Tribunals: (also referred to as National Assembly Election Tribunals) have original
jurisdiction to hear and determine petitions as to whether any person has been validly elected
as a member of the National Assembly; the term of office of any person under the CFRN has
ceased; the seat of a member of Senate or House of Assembly is vacant and question or
petition brought before the election tribunal has been properly or improperly brought. At
State levels, each has Governorship and Legislative Houses election Tribunals set up with
jurisdiction to hear and determine petitions as to whether any person has been validly elected
to the office of Governor or Deputy Governor or as a member of any legislative house.
Courts Martial: These are purely military courts and are established by the various Armed
Forces Acts. Members of the forces are subject to the jurisdiction of the court martial in
offences ranging from barracks revolt and mutiny, desertion, looting and aiding the enemy.
The composition of the court martial is determined by the rank or status of the accused
officer. However there is no appeal from the decision of a court martial.
JURISDICTION OF COURTS
Jurisdiction refers to the authority by which courts and judicial officers hear and determine
cases; the geographic region over which a courts power to hear and determine cases extends.

AN OUTLINE OF COMPANY AND PARTNERSHIP LAW

COMPANY LAW

The first Companies Ordinance was introduced in Southern Nigeria - Lagos in 1912. This
was then amended in 1917 to cover the whole country (Companies Amendment and
Extension Act of 1917). Both acts were then repealed and replaced in 1922 by the Companies
Act of 1922. The 1968 Companies Decree replaced the 1922 Act. Currently, the Companies
and Allied Matters Decree of 1990 regulates companies in Nigeria.
The Corporate Affairs Commission
The Company and Allied Matters Decree of 1990 is regulated by the Corporate Affairs
Commission (the commission); the commission is itself a body corporate with perpetual
succession and common seal.. Its main function 7 (1) is to administer advice including the
regulation and supervision of the formation, incorporation, registration, management and
winding up of companies registry and offices in all the state of the federation; arrange or
conduct an investigation into the affairs of any company where the interest of the
shareholders and the public so demand, etc.
Characteristics of a Company
The death of or transfer of a shareholder does not affect the corporate existence. It
enjoys perpetual succession.
It is managed by its duly elected Board of Directors or/and officers.
Individual shareholders cannot bind the company by their act.
Enjoys limited liability - the debts of the company are its debts. Members are not
liable personally for its debts.
A company cannot be constituted by mere agreement of the parties; it can only be
created by or under legislative enactment (decree).
It can be dissolved only by or with the consent of the state.
It can only exercise powers expressly conferred to it and its powers cannot be
enlarged without the consent of the state.
A limited liability company has the capacity to sue or to be sued in its own name.
Formation of Company
Any two or more persons may form and incorporate a company. No company association or
partnership consisting of more than 20 persons can be formed for the purpose of carrying on
any business for profit or gain unless it is registered as a company (co-operatives and
professional bodies, legal practitioners, Accountants etc. are exempt from this rule).
Capacity of individuals to form a company: An individual shall not join in the formation of a
company if he/she:
is less than 18 years of age

is of unsound mind.

is an undischarged bankrupt.

is disqualified under section 254 of the decree from being a director of the company.
[Section 254: if a person is convicted by a high court of any offence in connection
with the promotion, formation or management of a company, or has been guilty while

an officer of the company of any fraud in relation to the company or of any breach of
his duty to the company]
A corporate body in liquidation cannot join in the formation of a company.
An alien or a foreign company may join in forming a company subject to the capacity of
aliens to undertake or participate in trade or business.
Classification of Companies (Public or Private)
Company Limited by Shares: the liability of its members is limited by the memorandum to
the amount, if any, unpaid on the shares respectively held by them.
Company Limited by Guarantee: the liability of its members is limited by such amounts as
the members may thereby undertake to contribute to the assets of the company in the event of
its being wound up. It may not be incorporated with the object of carrying on business for the
purpose of making profits for distribution to its members.
When a company is formed for the purpose of promoting arts, science, religion, sports,
culture, education, research, charity etc. and the income and property of the company are
to be applied solely towards the promotion of its objects and no portion is to be paid
directly or indirectly to its members except as permitted by the decree, the company
shall not be registered as a company limited by shares but as a company limited by
guarantee.
Unlimited Company: no limit on the liability of its members. All unlimited companies shall
be registered with a share capital from the date of the Decree of 1990. If an existing company
is not registered with a share capital then the memorandum must be altered so that is becomes
an unlimited company having a share capital not below the minimum share capital permitted
under section 99 of the decree.
Types of Companies
Private company: A company that has been stated in its article of memorandum to be private.
The transfer of its shares is restricted. The total number of members shall not exceed 50,
excluding bona fide employees of the company. It shall not allow the public to buy shares or
debentures or deposit money for fixed periods or payable at call whether or not interest
bearing. If a company defaults on the provisions of section 22 of the decree, the company
shall cease to be entitled to the privileges and exemptions conferred on private companies by
or under the decree. The Decree shall then apply to the company as if it is not a private
company.
Public Company: Any company that is not a private company shall be a public company and
its memorandum shall state so. Every public company shall have capital except those limited
by guarantee-those formed for promoting commerce, arts, science, religion, culture,
education, research, charity etc. The total liability of a company limited by guarantee shall
not be less than N10, 000:00.
The Memorandum of Association
A memorandum of association is a formal request from the company signed by at least two
subscribers who are the companys first shareholders, this document must state:

Name of the Company:

The name of a private company limited by share shall end with the word Limited.

The name of a public company limited by shares shall end with the words Public Limited
Company or PLC.

The name of a company limited by guarantee shall end with the words Limited by
Guarantee.

The name of an unlimited company shall end with the words Unlimited.
A company may use the abbreviations Ltd., PLC. and ULtd for the words Limited, Public
Limited Company, and Unlimited.
Restrictions on Company Names
Companies cannot be registered (except with the consent of the commission) with a name
that includes the words:
Chamber of Commerce (unless limited by guarantee), Federal , National, Regional,
State, Government, Group, Holding, Co-operative, Building Society, Municipal,
Chartered or any other word which in the opinion of the commission suggests or is
calculated to suggest that it enjoys the patronage of the government of the federation or a
state.
The registered office of the company shall be situated in Nigeria.

The nature of the business which the company is authorized to carry on or if the
company is not formed to carry on a business, then the nature of the objects or
objects for which it is established.

The restrictions if any on the powers of the company.

If the company is a private or public company.

If the liability of the members is limited by share or by guarantee or is unlimited.

The subscribers to the memorandum shall take share amongst themselves not less
than 25% of the authorized share capital.

The memorandum shall be stamped as a deed.

If a company is limited by guarantee, then its memorandum shall also state that:
The income and property of the company shall be applied solely towards the
promotion of its objectives and no portion shall be paid or transferred (directly or
indirectly) to the members of the company except as permitted by the decree.

THE ARTICLES OF ASSOCIATION

These are rules which provide for the internal organization of the company. These include:
Statutory Requirement: Restriction on transferability of shares on membership and on
public subscription for private companies.

Share structure or class of shares:

Insurance and classification of shares. This is influenced by sec. 141 of the decree.

Rights attaching to shares

Transfer and transmission of shares

Increase and reduction of shares

Conversion.

Commission and Brokerage

Meetings:
Types of Meetings
Notice for meetings
Attendance and proceedings, proxy, voting, and quorum.

Upon complying with all the requirements, the commission shall register the company unless:
they do not comply with the decree
the business which the company wants to carry on or the objects for which it is
formed or any of them are illegal
any of the subscribers to the memorandum is incompetent or disqualified in
accordance with Sect. 20 or non-compliancy with any of the law as to incorporation.
the proposed name conflicts with or is likely to conflict with existing trade mark or
business name registered in Nigeria. Certificate of incorporation shall be the prima
facie evidence that all the requirements of the decree have been met.
Sec. 37 stipulates that from the date of incorporation mentioned in the certificate of
incorporation the subscriber of the memorandum together with such other persons as may,
from time to time become members of the company, shall be a body corporate by the name
contained in the memorandum capable forthwith of exercising all the powers and function of
an incorporated company including the power to hold land, and having perpetual succession
and common seal but with such liability on the part of members to contribute to the success
of the company in the event of its being wound-up as mentioned in the Act.
The Act further provides in (Sec. 41,1): subject to the provisions of this Act, the memorandum
and articles when registered, shall have the effect of a contract under seal between the
company and its members and officers and between the members and officers themselves
whereby they agree to observe and perform the provisions of the memorandum and articles,
as agreed from time to time in so far as may relate to the company members, as officer as
such.

Foreign Companies
Every foreign company that is incorporated outside of Nigeria and has the intention of
carrying out business in Nigeria shall register a separate entity in Nigeria. Until the separate
entity has been registered, the company shall not carry on business, exercise any of the

powers of a registered company or have a place of business in Nigeria. Before incorporation

in Nigeria the foreign company can only have an address for the receipt of documents and
other notices.
Foreign companies can apply (to the National Council of Ministers) for exemption from the
requirements stated above if they:
a) have been invited to Nigeria by or with the approval of the Federal Government to execute
a
specific
project.
b) are in Nigeria to execute a specific loan project on behalf of a donor country or
international
organisation.
c) are companies owned by foreign governments and are engaged solely in export promotion
activities
d) are engineering consultants and technical experts engaged in any specialised project under
contract with any of the governments in the federation or any of their agencies.
An application for exemption shall be in writing and addressed to the Secretary of
Government and should include:

The name and place of business of the foreign company outside Nigeria
The name and place of business or the proposed name and place of business of the
foreign company in Nigeria.
The name and address of each director, partner or other principal officer of the foreign
company.
A certified copy of the charter, statutes, or memorandum and articles of association of
the company or any other documents that defines the constitution of the company. If
the document is not in English then a certified translation is required.
The names and addresses of one or more person resident in Nigeria that are authorised
to accept notices on behalf of the foreign company.
The business or proposed business of the foreign company in Nigeria and the duration
of such business.
The particulars of any project previously carried out by the company as an exempted
foreign company
Any other particulars that may be required by the Secretary to the Government

PARTNERSHIP LAW
Partnership law in Nigeria is adapted from the English Partnership Act of 1890.
What is a Partnership?
A Partnership is a voluntary association of two or more individuals carrying on a business for
the intent of making profits. A person cannot be forced to be a partner (unless by conduct he
holds himself out or allows himself to be held out as a partner) or to accept another person as
a partner. In forming a partnership, no real formalities are required. A partnership can be
formed orally, in writing or by conduct. A maximum of 20 people are allowed in a
partnership.

A Partnership is defined to include every professional or commercial venture. Every

partnership must have a profit motive even though the business does not actually have to
make a profit. This excludes non-profit organizations (such as associations, clubs, societies,
etc.) from being seen as partnerships.
The sharing of profits is prima facie evidence of a partnership.
The Article of Partnership
It is good practice to prepare an Article of Partnership before proceeding with any business
venture. The partners can agree to any term in their partnership agreement, except illegal
terms. The article may be short and simple or long and complex. The following are some of
the issues that should be agreed upon and properly articulated in the agreement.
The name of the partnership
The nature of business.
The principal office of business and branches (If any).
Nature and scope of the partnership
Capital contribution of each partner and bankers.
Division of profits and losses among the partners.
Withdrawal of capital.
Management of partnership - conduct and power and participation in management.
Use and application of partnership property.
Remuneration of partners.
Unanimous consent cases, major decision.
Retirement, expulsion bankruptcy, death and incapacity of a partner.
Admission of new partners.
Loan or credit to members.
Termination or dissolution of the partnership.
Any other provisions deemed relevant by the partners
Characteristics of a Partnership
A Partnership is at will and not necessarily for life.
Each partner is an agent of and principal to every other party.
A partner cannot be expelled by another partner.
Partners have unlimited liability.
A deceased partner's rights in specific partnership property vests with the remaining
partners upon his death (right of survivorship).
Ownership interest may not be transferred without the consent of all the owners.
A partnership exists by mutual agreement of all the parties.
A partnership must have intent to make profits. A partnership does not pay income tax
in its own name.
Partners pay tax on their individual share of the profits of a partnership.
Types of Partners
Active Partner: Participates in all activities of a partnership.

Dormant or Sleeping Partner: A partner that does not take an active part in the
operations of the partnership but shares in the profit. This type of partner is typically
not known by the public.
Silent Partner: A partner who is known by the public as part of the partnership but
he/she does not take an active part in the operations of the partnership.
Nominal partner: A person who lends their name to a partnership without having any
financial interest in it. The name is lent to the partnership for a consideration.
Secret partner: A partner that takes active part in the affairs of the company but he is
not known by the public as part of owners of the partnership.

Rules that determine the existence of a Partnership:

An agreement to share in the losses of a business is strong evidence of a partnership

Co-ownership of property by joint tenancy, tenancy in common, joint property,
community property, or part ownership does not on itself establish a partnership.
People who are not partners to each other are not partners to a third party/person
(unless a partnership by estoppel is created when a person who is not a partner either
makes a representation or consents to a partners representation that he is a partner).
Sharing of gross return of a business does not itself establish a partnership, whether or
not the person sharing it has a joint or common right of interest in any property from
which the returns are derived.
Receipt of a share of the profits of a business is prima facie evidence of a partnership.

No inference of the existence of a partnership shall be drawn if such profits were received in
payment;

as wages of an employee or rent to a landlord,

as annuity to a widow, widower or representative of a deceased partner,
as debt owed to a creditor in instalments or otherwise,
as an interest in a loan
as the consideration for the sale of the goodwill of a business or other property by
instalment or otherwise.

Limited Partnership:
Generally, limited partnerships (a special form of partnerships that has both limited and
general partners) do not exist in Nigeria. However, limited partnerships exist in Western
Nigeria and Mid-Western
Nigeria.
A limited partner cannot withdraw funds as long as the partnership is in existence. He/she is
not personally liable for partnership debts beyond their capital contribution. He/she must not
take active part in the management of the partnership. He/she must not bind the firm and not
to be seen as agent. He/she can assign his shares with the approval of the general partners.
He/she cannot dissolve the partnership.
Capacity of a Partner:
Every partner is an agent of the partnership for purposes of its business and an
agent of every other partner concerning his/her own acts
Each partner is also a principal of every other partner concerning their acts

An infant can become a partner and is bound by partnership agreement.

He/she can repudiate while still an infant.
An infant that is a partner is not liable for trade debts of the partnership.
A person found be insane by a court of law cannot become a partner.

Liability of Partners
Every partner is liable jointly with all other partners for all the debts and obligations
of the firm incurred while he is partner. If he dies, his estate is also held severally
liable for debts unsatisfied. He can sue all or one of the partners (jointly or severally).
A partnership can be sued in the business name. Each partner sued can apply to join
other defendants.
A partner can personally sue the firm or other partners for deceit, fraud or
misrepresentation.
The partnership is jointly and severally liable (one or more of the partners can be
sued separately) for breach of trust or a tort (wrong) done to a third party in the
course of business if it was authorized.
The partnerships debts or liabilities are the personal debts and liabilities of each
partner. Each is liable to the extent of his personal assets.
A person admitted into an existing company does not thereby become liable to the
creditors of the firm for anything before he became a partner. However, he can
become by novation.
A partner who retires from the firm does not cease to be liable for partnership debts or
obligations incurred before his retirement.
The acts of a partner bind the firm and his partners unless:
the partner has no authority to act for the firm in that matter; and the external party
with whom he/she is dealing either knows that he/she has no authority or does not
know or believe him/her to be partner (e.g. expenses incurred by a partner in an
unrelated business will not bind the other partners).
The authority to act on behalf of a partnership may be vested in a partner by express
or implied authorization of his co-partners or the partnership agreement, or by virtue
of the usual authority associated to owners of such line of business, or by the conduct
of the partners in ratifying the other partner's act.
Indemnity of Partners
A partner is entitled to indemnification (i.e. reimbursement) for losses, expenses and personal
liabilities incurred in the discharge of the firm's business.
Partners are expected to contribute and share equally in the capital and profits of the firm and
must contribute equally towards the losses of capital and otherwise, unless the partners
expressly vary the ratio of contribution.
Dissolution of a Partnership
A partnership may be dissolved by;
An agreement of the partners.
The death or bankruptcy of any partner.

Any event which makes the carrying of the partnership illegal dissolves the
partnership.
Order of a court. Any of the partners could apply and obtain court ruling that a
partnership be dissolved on specified grounds - insanity of a partner, criminal
conviction, etc.
Expiration or notice.
Subject to any agreement between the partners, a partnership is dissolved;
by the expiration of a stated term or purpose
if entered into for an undefined time, by any partner giving notice of
dissolution to the others.
by misplaced trust and confidence
The partners owe to each other mutual trust and confidence. Wilful or persistent
breach of the partnership agreement, fraud, misrepresentation, keeping erroneous
account, appropriation or stealing of partnership property, etc. can force the
aggrieved partners to give notice of dissolution.
By the business ceasing to be profitable and the partners can no longer accommodate
the losses dissolution is allowed.
On dissolution each partner can give public notice and compel other partners to sign the
notice papers. The dissolution of a partnership terminates the partners actual authority to
enter into contracts or otherwise act on behalf of the partnership. After dissolution and proper
liquidation (sale) of the assets, the proceeds are used to satisfy the debts and obligations of
the partnership. Partners can agree to take a distribution in kind rather than cash. If the
partnership cannot satisfy its debts and obligations the partners are personally liable.

CONTRACT
A contract is simply an agreement between two parties where one party undertakes (or
covenants) to carry out works, usually and in our case now construction/engineering works,
in consideration (or expectation) of a consequent gain/reward.
In construction law, the agreement is usually between a builder or engineer on one part who
undertakes to carry out construction or engineering works for and on behalf of the client or
employer on the other part, for a reward which is usually financial. Such an agreement thus
binds the two parties together with the effect that the builder or engineer has to carry out the
agreed works while the employer in turn is obliged to pay for such works. It is too vague for
two parties to contract as explained above. Details are often specified for the fulfilment of
each sides obligations. In this regard the conditions of contract and other contract documents
are often employed in the formation and execution of contracts. Only the principles of
construction law are written for the scope of our consideration and they are being considered
below:
THE LAW OF CONTRACTITS NATURE
A contract as explained above once entered into becomes binding on the parties. Any breach
of part or all of it is enforceable at law. The nature of a contract is such that one party agrees
to work for the other in return for a favour; this favour is either detrimental to the second

party or beneficial to the first. While a contract is enforceable at law i.e. by its intention to
create a legal relationship, a simple agreement is not.
TYPES OF CONTRACTS
1. Simple contracts 2. Contracts under seal
Contracts could broadly be classified into two categories as mentioned above:
1. Simple contracts: A contract as explained above denotes a simple contract. A simple
contract could be verbal, written or partly verbal and partly written. At times, conduct could
entail a contract. Simple contracts form the basis of the law of contract. However, that is not
aimed at undermining the importance of contracts under seal as they equally have their
advantages. Detail considerations within our scope would be centered on simple contracts. A
cursory view of contracts under seal is being done below before the subsequent discussions
on simple contracts.
2. Contracts under seal: This type is usually in writing and it is sealed and delivered to the
parties thereto. Sealed in this case could mean the affixing of a paper wafer while
delivered is the physical delivering of the deal to the other party. The delivering is done
physically to either the other party or his agent. And the protocol is that the party that is doing
the delivering touches the seal is and utters the words I deliver this as my act and deed.
DIFFERENCES BETWEEN SIMPLE CONTRACTS AND CONTRACTS UNDER
SEAL
1. Under the Limitation Act of 1939 the limitation period of a contract under seal is 12 years
while that of a simple contract is 6 years. A contract under seal may thus augur well for a
client who offers a qualitative work especially as in construction and engineering jobs.
2. The recitals of a contract under seal operate by way of estoppel against the parties to the
contract in any action or preceding that is based on the contract itself.
3. A simple contract that is not supported by consideration cannot be specifically enforced.
The only remedy is damages. But contract under seal may not necessarily be supported by a
consideration (to remain open).
4. In simple contracts, the parties must be in agreement (consensus ad idem = agreement of
the minds), whereas in a contract under seal they may not.
FORMATION OF A SIMPLE CONTRACT
A simple typical contract is ensured as follows: say, A construction company offers to
construct a 5km road for B Nig. Ltd at a cost of N50M. And B Nig. Ltd on its part agrees
to pay A construction company the stated amount on completion of the work or other stated
conditions. For the example above where a 5km road is the subject under consideration there
is an offer by one party and an acceptance by the other. There is equally a consideration
(N50M) which is a detriment of one party (B), yet a benefit to the other party (A).
These three factors of offer, acceptance and consideration are basic essentials of a valid
contract. The other essentials are:
i. Intention to create legal relations (go into litigation)
ii. Capacity of the parties (legally) to go into the contract.

iii. Genuine consent of both parties, consent that is devoid of fraud, duress, etc. No one
should be cajoled into a contract for selfish reasons. Refer to consensus ad idem.
iv. The object of contract must be legal. A contract of which the object is forbidden by law is
null and void.
v. Possibility (and ability) to perform the contract.
The courts in trying to decide whether two parties have reached a legally binding agreement,
look for certain external signs of such agreement. The first two, which inevitably have to be
considered together, are offer and acceptance.
I. OFFER
An offer may be defined as an indication by one person that he or she is prepared to contract
with one or more others, on certain terms, which are fixed, or capable of being fixed, at the
time the offer is made Since its acceptance will constitute a contract its terms must be definite
and specific. Otherwise, an offer that is too vague cannot result into a valid contract even if it
is affected. Thus, the statement I will sell you 500 packets of Bic pens for N2,000 is an
offer, as is the statement I will buy from you 5,000 shares in X Ltd, at their closing price on
the Nigerian Stock Exchange next Friday. In the former case, the terms are fixed by the offer
itself, in the latter they are capable of becoming fixed on Friday, according to the price of the
shares at the close of business on the Stock Exchange. Once there is an indication of
willingness to contract of this type, all that is then required from the other person is a simple
assent to the terms suggested, and a contract will be formed.
Anyone with legal capacity can make an offer, orally, in writing or by implication from
conduct, such as gestures. A combination of any form is perfectly valid such as a telephone
conversation, which is oral plus a written estimate. Sellers or buyers may make offers as may
contractors or employers or indeed any type of contracting party. Who makes the offer has to
be assessed in each set of circumstances in order to determine who may accept the offer. The
person making the offer is called the offeror, and the person to whom the offer is made is
called the offeree.
The following cases will explain an offer more:
i. Harvey V. Facey (1893). H telegrammed F, will you sell us Bumper Hall pen? Telegram
lowest cash price. F telegrammed in reply Lowest price for Bumper Hall pen 900. H
telegrammed; we agree to buy Bumper Hall pen for the sum of 900, asked by you.
Held: That Fs telegram was a mere statement of the lowest price and not an offer to sell
capable of being by H so as to constitute a contract. Hs first telegram was an enquiry which
was partially answered by Fs reply. An enquiry cannot constitute an offer. The supposition
that if F is willing to sell he should then send the lowest price is weightless because an offer
should be specific and not conditional.
ii. Crowshaw V. Pritchard (1899). P wrote C our estimate to carry out the alterations to the
above premises according to the drawings and specifications amount to 1,230. C replied
accepting the estimate.
Held: That the estimate was an offer accepted by Cs letter, that there was no custom that a
letter in form of an estimate was not to be treated as an offer and that such a custom will be
contrary to law.

An offer is no less an offer because of some other words such as estimate or quotation or
order or even acceptance is used. An offer should be distinguished from a mere invitation
to treat. If a client advertises for tenders in respect for a project he is merely inviting
contractors to treat and that is not an offer. However, compliance to this invitation by the
contractors constitutes offers being made by them (the contractors). If the client in turn
accepts one of them he is just bound to the accepted offer. The distinction between offer and
an invitation to treat is an important one, but is not always easy to draw. Even where the
parties appear to have reached an agreement on the terms on which they are prepared to
contract, the courts may decide that the language they have used is more appropriate to an
invitation to treat than an offer. This was the view taken in Gibson V. Manchester City
Council (1979). Mr. Gibson was a tenant of a house owned by Manchester City Council. The
Council at the time under the control of Conservative Party members, decided that it wished
to give its tenants the opportunity to purchase the houses which they were renting. Mr.
Gibson wished to take advantage as this opportunity, and started negotiations with the
council. He received a letter which indicated a price, and which stated The corporation may
be prepared to sell the house to you at that price. It also instructed Mr. Gibson, if he wished
to make a formal application to complete a form and return it. This Mr. Gibson did. At this
point local elections took place, and control of the Council changed from the Conservative
Party to the Labour Party. The new Labour Council immediately reversed the policy of the
sale of council houses, and refused to proceed with the sale to Mr. Gibson. Despite the fact
that all terms appeared to have agreed between the parties, the House of Lords held that there
was no contract. The language of the Councils letter to Mr. Gibson was not sufficiently
definite to amount to an offer. It was simply an invitation to treat. Mr. Gibson had made an
offer to buy, but that had not been accepted. In every case it is the exact circumstance and
language you use that should be carefully examined before an offer could identified.
Withdrawal of an offer
An offeror could state a time limit to which his offer is open, otherwise it lapses or expires
after a reasonable time. Reasonable time will depend on the particular circumstances. The
expiration of an offer renders it incapable of acceptance and it is understood to be withdrawn
so to say. However, before an offer is accepted it could be;
-Expressly withdrawn
-Rejected or
-Revoked by a counter offer, or it is purported to be rejected by the addition/subtraction of
some terms or conditions.
i. Routledge V.Grant (1828). The defendant offered to buy a house from the plaintiff and to
give the plaintiff six weeks for a definite answer. (The defendant wanted to withdraw his
offer before the expiration of the six weeks, but the plaintiff wouldnt oblige and he sued).
Held: That the defendant might retract the offer at any time before acceptance although the
six weeks had not expired (this does not apply to specialty contract).
ii. Hyde V. Wrench (1840). The defendant offered to sell his farm to the plaintiff for 1,000.
The plaintiff in reply offered to pay 950 which the defendant refused. The plaintiff then
wrote to the defendant agreeing to pay 1,000 to which the defendant made to reply. (The
plaintiff then sued, what are his chances?)

Held: The plaintiff by making an offer of 950 had rejected the defendants offer of 1,000
and could not thereafter revive and accept it. The plaintiffs offer of 950 is a counter-offer
which automatically nullifies the defendants offer.
iii. Byrne V. Van Tienhoven (1880). By letter dated October 1st the defendants wrote from
Cardiff to the plaintiffs in New York offering to sell certain goods. The plaintiffs received the
letter on October 11th and accepted it offer by telegram the same date. On October 8th, the
defendants posted a letter to the plaintiffs which reached them on October 20th withdrawing
their offer.
Held: the withdrawal of the offer by the letter of October 8th was ineffective, a binding
contract having been concluded on October 11th by the sending of the telegram when the
plaintiffs had no reason to think that the offer of October 1st has been withdrawn. The
withdrawal of an offer takes effect when it comes to the notice of an offeree. If a withdrawal
is posted it takes effect from the time of its receipt by the offeree and not from the time of its
posting. However, an acceptance takes effect from the time of its posting.
Death of offeror or offeree
An offer made to an offeree cease to be on his death because it is neither intended to a death
person nor his executors.
II. ACCEPTANCE
For an acceptance to be valid it must be made to the offeror. Such an acceptance must not
only be clear and unambiguous but it must satisfy the condition of the other. In the Byrne V.
Van Tienhoven (1880) case it was seen that where the post could be established to be the
means of communicating an offer than the acceptance takes effect from the day it was posted.
Conduct, will if submitted, amount to acceptance if no any other reasonable inference can be
drawn from the conduct in question. For example, if a client asks civil engineers to submit
proposals on a proposed bridge construction, if they complied, it is deemed that he should
pay them for the job done even if they knew they were in completion with each other. The
conduct of their compliance is a valid acceptance. The same interpretation would apply if a
landlord asks a builder to come and make some repairs for him.
i. Felthouse V. Bindley (1862). After some negotiations for the sale of a horse A wrote to
B, If I hear no more about him, I consider the horse is mine at 30.15. B made no
reply, but when selling his farm instructed the auctioneer to reserve the house. The auctioneer
by mistake sold the horse (A sued B).
Held: That A had no right to impose a contract on B by providing that Bs silence should
be his acceptance, that although B in his own mind intended to accept As offer, he had done
nothing to communicate this intention and there was no binding contract.
ii. Davies & Co. Shoplitter Ltd V. William Old (1969). An architect invited and accepted
the tender of a nominated Sub-Contractor. The main contractor placed an order with a term
on the back (for no payment of the sub-contractor until the main contractor was himself paid)

which conflicted with the earlier documentation. The nominated sub-contractor started work.
(Is he entitled to payment?)
Held: That the Architect was not the agent of the main contractor so that the order of the main
contractor constituted a counter-offer which has been accepted by the sub-contractors
starting work (i.e. by conduct). Note: conduct amounts to acceptance. The nominated subcontractors conduct was an acceptance of the main contractors directive.
III. CONSIDERATION
This is a promise or conduct by the other party to a contract which is either a detriment to that
party or is a benefit to the party that is given the promise to be enforced. The House of Lords
adopted a definition; An act or forbearance of one party or the promise thereof is the price
for which the other is bought, and the promise thus given for value is enforceable. Other than
specialty contract, simple contract must be supported by consideration to be enforceable. This
creates biasness in the normal building contract when for example the subcontractors are
brought in as third parties. In such contracts, there is usually some consideration between the
client and the main contractor but such a consideration does not extend to the subcontractor.
It means that the sub-contractor cannot sue the client on the contract and vice versa. This is
simply because there is no consideration between the two of them. The situation would have
been otherwise, i.e. enforceable had it been a contract under seal. Offer may be defined as an
indication by one person that he or she is prepared to contract with one or more others, on
certain terms, which are fixed, or capable of being fixed, at the time the offer is made. Since
its acceptance will constitute a contract its terms must be definite and specific.
i. City of Moncton V. Stephen (1956). In 1952 a contractor carried out a new contract for a
City Council. In 1953, the surface deteriorated and the contractor became concerned at his
reputation locally and his prospect of obtaining further work from the Council and other
contracts. At that time he was owed 1,800 on the 1952 contract. He then repaired the road
though not requested to do so and the council did not prevent him from doing so. Later, he
did not obtain the further work for which he had hope and claimed to be paid a reasonable
price for the 1953 work. (Should the Council pay him?)
Note: Generally, when a contractor has carried out work for the employer he must establish
an express or implied promise to pay for it. Sometimes, when there is no express promise an
implied promise may be ruled by the courts but not in all instances [City of Moncton V.
Stephen (1956)]. If the consideration is illegal, the contract is in enforceable [Windhill
Local Board of Health V. Vint (1890)].
A consideration does not have to be explicit and the implicit consideration is inferred once
the promises, action or forbearance could be established. A consideration does not have to be
specific but a reasonable amount would always be interpreted. Some attributes of
consideration include the following:
i. It must be of some value in the eye of the law but it may not be adequate
ii. It must not be immoral, illegal or contrary to public policy
iii. It must be definite and not vague.
iv. It may be executed (present) or executor (future) but it must never be past.

v. It must never be something which the promise is already bound either by contract or public
duty, to do or refrain from doing.
IV. INTENTION TO CREATE LEGAL RELATIONS
This goes hand in hand with consideration, though this intention might not have been
expressed. Surrounding circumstances, will dictate weather a legal relationship will always
be intended.
Carlill V. Carbolic Smoke Ball Co. (1893)
In England the most famous case of an advertisement constituting an offer is Carlill V.
Carbolic Smoke Ball Co (1893). The company, manufacturers of a smoke ball advertised its
product at the time of an influenza epidemic, proclaiming the virtues of their smoke ball for
curing all kinds of ailments. In addition, they stated that anybody who bought one of their
smoke balls, used it as directed, and then caught influenza, would be paid 100. Mrs. Carlill,
having bought and used a smoke ball, but nevertheless having caught influenza, claimed 100
from the company. The company argued that the advertisement could not be taken to be an
offer which could turn into a contract by acceptance. They claimed that it should be regarded
as a mere puff which meant nothing in contractual terms. This is to certainly true of many
advertising slogans. A contractual actions based on these would be doomed to failure. In the
Carlill case, however, there was evidence of serious intent on the part of the defendants. The
advertisement had stated that 1,000 is deposited with the Alliance Bank, showing our
sincerity in this matter.
Held: It was held that the company was liable despite their plea of no intention to create legal
relationship. The court using the objective test felt that a reasonable third person looking at
the advertisement especially the dealing with 1000 that has been deposited would infer that
an intention to create legal relationship is existent. The defendants then failed.
However, an intention could be negative either expressly or by the surrounding
circumstances. In purely social domestic affairs, the courts will seldom imply an intention to
create legal relationship.
Balfour V Balfour (1919)
The defendant a civil servant was on leave in England with his wife, at the end of the leave he
went to Ceylon leaving his wife on medical grounds. Before leaving, he agreed to pay his
wife 30 monthly while they remain apart on condition that she agreed to support herself
without calling on him for further assistance. The husband defaulted in the payment and the
wife sued him.
Held: The agreement did not constitute a valid contract but a mere domestic agreement and
hence, the wife could not sue.
Despite the above case certain circumstances could turn social and domestic agreement into
valid contract.
Simkins V Pays (1955)
S agreed with P and Ps granddaughter (three of them being female co-habitats) to share the
winning if any of their joint entry in a newspaper fashion competition. A forecast by the

granddaughter proved correct and the defendant received a prize of 750. The plaintiff sued
for her share of 250.
Held: There was an intention to create a legal relationship. Evidence showed that there was a
joint enterprise the parties expected to share any prize won in the competition. In the event of
a win, and this agreement was meant to be enforceable. It was not mere domestic
arrangement (to understand this case refer to characteristics of partnership).
The other essentials of a contract will later be considered as some broad considerations of
simple contracts are made.
V. LEGAL CAPACITY OF THE PARTIES IN A CONTRACT
The general rule is that any person of whatever nationality or sex may enter into a binding
contract. To this rule, there are certain exceptions. It should be remembered that the word
person includes both natural and artificial (juristic) person, such as corporations.
The term capacity is used in law denotes the ability to incur legal liability or to acquire legal
rights. Because of the infirmities of certain persons such as infants and lunatics, or the
peculiar nature of others such as corporations, not all persons are capable in law of entering
into a valid contract.
The incapacity of these mentioned persons, i.e. infants, insane, drunken persons and
corporations would be considered, however, it is worth mentioning, that the crown and public
authorities are equally exempted from contractual liabilities.

Infants or minors
Although in most instances, minors are not liable or cannot be held liable in contracts
contracted between them, contracts between/with infants could be categorized as follows:
Those that are valid and binding on the infant
Those that are voidable (could be set aside, nullified, cancelled etc) at the instance of
the infant.
Those that are (totally nullified i.e. no contract takes place in the first place), and
Those that is unenforceable against the infant unless he ratifies them.
Generally, an infant is a minor who has not come of age. The age of maturity is 18 years.
The rights and liabilities of infants under contracts entered into by them during infantry rests
upon common law rules which have been materially affected by the Infants Relief Act
(IRA) of 1874.
There are two classes in this group, which are:
Contracts in which the infant acquires an interest of a permanent or continuous nature.
Such contracts were valid and binding on him until he disaffirms them, e.g. shares in a
company or interest in hand.
In cases of contracts which were not that continuous in their nature or operation, the
rule was that they were not binding until he ratified them, e.g. paying for goods
supplied him (except for necessaries).
In both (a) and (b) above, the action must come either during infancy or within a
reasonable time of gaining maturity.

Two points of the IRA (1874) are:

All contracts henceforth entered into by infants for the repayment of money lent, or
for goods supplied or to be supplied (except necessaries) and all accounts stated with
infants shall be absolutely void: provided always that these enactment shall not
invalidate any contract into which an infant may by an existing or future statute or by
the rules of common law or equity, enter, except such as by law, now void able.
No action shall be brought whereby to change any person upon any promise made
after full age to pay any debt contracted during, infancy weather there shall or shall
not be any new consideration for such promise or ratification after full age.
Reg. V. Wilson
W an infant was convicted under section 12 of the Debtors Act (1869) for feloniously,
within four months to the amount of 20 upwards, which ought by law, to have been shared
amongst his creditors with intent to defraud.
Held: He was acquitted on the grounds that the transactions which gave rise to the debts were
contrary to the IRA and as such void. Consequently there was no single valid contract.
An infant who buys goods on credit can both keep the goods and the refuse to pay for them.
On the other hand, where an infant pays money in pursuance of a contract that is rendered
void by the Act (IRA), he cannot recover the money so paid if he had received any benefit
whatever under the contract.
Valentini V. Canali (1889)
An infant took a lease of a house and agreed to par the landlord 102 for the furniture. He
paid 68 and gave a promissory note for the balance. After some months use of the house and
the furniture he took proceedings to get the lease set aside and to recover the money which he
had paid.
Held: That the lease should be cancelled and the promissory note delivered up but the part
payment could not be recovered.
Smith V. King
King, an infant, became liable for a firm of brokers for 547. After he became of age, they
sued him and he compromised the suit by giving two bills of exchange for 50. The firm
endorsed one of the bills to Smith who took it with the knowledge of all the circumstances
and sued upon it.
Held: That Smith could not recover.
Edwards V. Carter (1893)
An infant became a party to a marriage settlement under which he took considerable benefits.
He covenanted to bring into the settlement any property which might come to him under his
fathers will. One month later he became of age and nearly four years later his father died
leaving him property by will. More than a year after his fathers death he purported to
repudiate the contract.
Held: By the House of Lords: That it was not too back out of the contract.
1. Contracts for necessaries.

Necessaries are goods suitable to the condition in life of drunkards, infants and those that are
mentally incapacitated, and to their actual requirements at the sale and delivery (Sale of
Goods Act 1979 Section 3)
In any legal action, therefore, the courts have to decide whether the goods in dispute are as a
matter of fact necessaries for that particular minor having regard to his condition in life (or
status or standard of living)
Examples of necessaries include such as food, clothing, medical attention and educational
books. Even services such as legal advice and hire of a car have been held to be classified as
necessaries for the minor.
Where a minor is married the term will include necessaries for his wife and any children he
may have.
The following cases explain the effects of necessaries to the aforementioned categories of
people i.e. infants, drunkards and the mentally retarded.
Ryder V. Wombwell (1868)
The defendant, an infant with income of 500 per annum bought from the plaintiff a pair of
crystal, ruby and diamond solitaires and an antique goblet in silver gilt. He later claimed that
they were necessaries.
Held: that these articles could be a necessary even though defendant moved in the highest
society.
Note: Other things may be of useful character but the quality or quantity of light may take
them out of the character of necessaries.
Nash V. Inman (1908)
A tailor supplied an oxford undergraduate with clothing which included eleven fancy waist
coats worth two guineas (2.20)
It was proved that although he was an infant he already had a sufficient supply of clothing
according to his position in life.
(The judgment by Idly J. implies that the clothes supplied where not necessaries and as the 1 st
aspect of the IRA infers, the plaintiff, that is the tailor could not recover. He thereafter
appealed against this judgment).
Held: The court of appeal held that. The tailor could not recover the sum due since the
clothes were not necessaries, the court must take into consideration the character of the goods
supplied, the actual circumstances of the infant and the extent to which the infant was already
supplied by such goods. It is important to note the words actual circumstances because a
false impression conveyed to the tradesman by the infant will not affect the infants liability.
A loan of money to an infant to pay for necessaries was not recoverable at common law
because the infant could use such money to pay for other purposes. In equity however, if the
money is actually used in paying for the necessaries, then the creditor can recover.
2. Contracts of service or apprenticeship or other beneficial contracts

Service or apprenticeship i.e. the infant receives some training or instruction in an art or
trade. If a contract, when examined in all its terms, is beneficial to the infant then such a
contract is binding on the infant and he cannot repudiate it.
De Francesco V. Barnum (1889)
By an apprenticeship deed an infant aged 14 bound herself to the plaintiff to be his apprentice
in the art of choreography for seven years. The plaintiff was to teach her stage dancing and
during the period of apprenticeship the infant was not to take any professional engagement
without the consent of the plaintiff, nor was she to marry. She was to receive certain
payments for any performances she might give but, there was no provision for any other
remuneration and the plaintiff did not undertake to find her engagements. The effect of the
deed was to place the infant entirely at the disposal of the plaintiff.
Held: It was held the contract was not beneficial to the infant and was just unenforceable
Doyle V. White City Stadium Ltd (1935)
A professional boxer who was an infant in consideration of his receiving a license from
British Boxing Board of Control agreed to be bound by the rules of the board in all his
professional engagements. A purse of 300 was withheld from him by the board in
accordance with its rules on the ground that he had been disqualified for hitting below the
belt, he wanted to claim the 300.
Held: The agreement was binding on the infant. (Since the agreement was beneficial to the
infant because of the money he gets in return.)
3. Fraudulent misrepresentation of full age (fraud of an infant)
When an infant fraudulently represents himself to be of full age and thereby induces another
person to enter into a contract with him, the contract is still unenforceable against the infant.
In certain circumstances however, equity will intervene to prevent the infant from taking
advantage of his own deceit if the goods or property have not been parted with.
Leslie Ltd V. Sheill (1914)
An infant obtained an advantage by falsely stating himself to be of full age. The plaintiffs
were a firm of money lenders and they sued the defendant to whom they have made two of
200 each. They wanted to recover 475 being the amount lent plus interest.
Held: The Court of Appeal maintained that no action could be brought for the recovery of the
loans. That the plaintiffs could not recover the money by an action for fraud, for this would
be an indirect way of enforcing a contract which was void by statue. Nor was there any rule
of equity by which the infant could be compelled to restore the money he had obtained by
fraud.
4. Corporations (Artificial / Juristic Persons)
A company is generally allowed to enter into binding contracts only on matters contained in
its Memorandum of Association. It cannot make contracts inconsistent with or foreign to
those objects.

5. Mentally disordered and Drunken Persons

The contract of a mentally disordered or drunken person is binding on him unless it can be
shown that at the time of making the contract he was wholly incapable of understanding what
he was doing and that the other party knew of his condition. If these conditions could be
proved he, i.e. the drunkard or the mentally disordered, could elect to avoid the contract or
affirm it. His affirmation binds him to the contract.
Matthews V. Baxter
The defendant while drunk agreed at an auction sale to purchase from the plaintiff certain
houses and land. Afterwards when sober, he affirmed the contract and then repented of his
bargain. When sued on the contract he pledged that he was drunk as at the time he made it
and to the plaintiffs knowledge.
Held: He was bound by his affirmation. If he had not affirmed he could have escaped the
contract.
6. Married Women
There is a Married Womens Property Act of 1882 which gave some preferential treatment to
women. However, unlike before, married women are no longer under any legal disabilities
and therefore are not given preferential treatment.
ASSIGNMENT OF A CONTRACT
This is the transference of the contractual rights to a stranger to the contract.
The distinction should be made between contractual rights and contractual liabilities. While
the former is a benefit the latter is a burden and while the former could be assigned a liability
cannot.
Contractual rights under an engineering contract are legal and could thus be transferred.
Assignment could be done in the following ways:
1. Statutorily See the law of Property Act (1925) section 136. This assignment stated in
writing and takes effect from the date of notice. For example, an Engineer could assign his
retention money (right of it) to someone else. No consideration is required to assign his right
and the two conditions of writing and serving notice are sufficient enough.
2. Equitably Its effect unlike the previous one is that the assignee cannot sue on the
assigned right alone except in conjunction with the assignor, either as a co-plaintiff or if he
will not agree as co-defendant. Imagine a contractor dealing with a sub-contractor who in
turn has a supplier. A right cannot be assigned either as a co-plaintiff or co-defendant.
3. Operation of law a) death b) bankruptcy; both serve to automatically transfer ones right
to his relatives / trustees accordingly.
Note that some rights are not assignable e.g., the right to arbitration, right to seizure or
forfeiture, mere right to litigation.
BREACH OF CONTRACT
This occurs when a party to a contract either fails to perform his contractual obligation or
where he could repudiate such obligation expressly or by implication. Repudiation of
obligation before performance is known as anticipatory breach.

Remedies for breach of contract

Series of remedies abound to an injured party in a contract of which he could sue on one or
more of them depending on the subject matter. These remedies include:
Refusal of further performance of the contract (to rescind). If he rescinds he
must return any benefit he received under the contract.
Action for damages; (a). Unliquidated damages compensation of loss
suffered and not punishment is the objective here. (b). Liquidated damages
pre-assessed loss is accordingly paid to the aggrieved party (as provided in
their contract), (c). There are other types of damages. (Check).
Action on a Quantum meruit (means as much as he has earned). This is a
claim for services rendered so far, where of course there is a consideration of
the other party to pay for part or partially completed services e.g. in a contract
of renovation or repairs where there is agreement to pay but no fixed sum
indicated. However, a reasonable sum is implied and the court decides the
sum. The reasonable remuneration is the Quantum meruit.
Action for specific performance This is an equitable remedy that is applied
where money cannot be enforced as damages.
Injunction An injunction is an order of the court restricting a person from
doing an act. Injunctions are discretionary remedies which the court will grant
in those circumstances where the court is satisfied no other remedy is
adequate; it is not possible to claim an injunction as a right. The value of an
injunction is that if there is an infringement the court will deal with the matter
as contempt of court, which may well mean imprisonment.
Injunctions are of three kinds, mandatory, prohibitory and quia timet.
A mandatory injunction is a court order requiring him to correct some wrong he has done.
A prohibitory injunction is a court order requiring the defendant not to commit a wrongful
act. These injunctions may be obtained either as perpetuity or interlocutory. A perpetual
injunction is a court order made after the master has been determined by the court. An
interlocutory injunction on the other hand is obtained before the matter is brought before the
court; the purpose being to maintain things as they were before the acts which are the subject
of complaint; for example to prevent work being done which it is alleged constitutes a
nuisance. This injunction has a limited life and ceases to be effective when the matter is
finally settled by a court. The third injunction is quia timet. This is an injunction granted
when no act has taken place which constitutes a wrong but where there is evidence to suggest
that a wrong is likely to occur. It may be \used by for example, a person whose land adjoins a
building site where the work is such that there is a strong likelihood of trespass being
committed to his land. He does not have to wait for his legal rights to be infringed provided
there is sufficient evidence to justify his fears. For example; a breach for sale of land or share
in a company. Here, an alternative is not readily available in the open market; equity thus
ensures a specific performance.
Lumley V. Wagner
W agreed to sing at Ls theatre for a certain period and during that time not to sing
elsewhere.

Later, W contracted to sing at another theatre and refused to perform her contract with L.
Held: that an injunction should be granted to prevent W from singing elsewhere. The court
would not however, granted an order of specific performance to compel W to sing for L.
DISCHARGE OF A CONTRACT
Discharge of a contract is end of contract. It comes about when all obligations which arose in
a contract are discharged and all consequent rights therefore are extinguished.
Means of discharge
Performance Complete and not partial performance
Agreement to waive each ones rights in the contract. The agreement stands as a
consideration for a waive.
Breach where the breached party can prove that the breach is of the whole
contract, or some vital part of it or that it goes to the root of the contract then he is
entitled to claim a discharge on that contract.
Frustration (subsequent impossibility) for example, subsequent illegality,
destruction of a specific thing that is necessary for performance, death or personal
incapacity and the like.
Operation of law in respect; (a) lapse of time period of time allocation is
exceeded or there is a length delay, (b). Merger of contract to a new one in which
case the latter contract supersedes the former, (c). Material alterations to a
contract. E.g. dates, names, monies etc, (d). Bankruptcy, (e). Death where
personal services are concerned, e.g. an artist contracts to paint a portrait for
someone but dies before performance.
TORT
Tort is a French word which means wrong. Basically, tort is concerned with situation where
the behaviour of the party causes, or threatens to cause harm to the interests of another party.
The law of tort is limited in its scope and not every wrong suffered has legal remedy.
A plaintiff can only succeed only if he proves that the defendants action fall within categories
of tort covered by the law e.g. defamation, nuisance, negligence and trespass. Some actions
of behaviour give rise to liability in tort and crime at the same time. Criminal law is
concerned with preservation of order in the society while tort compensates victims that suffer
harm. A driver who kills someone on the road faces criminal charges and can be sued on
behalf of the victims for damages. Developments today make the court to have power to
make compensation to victims and also punish the defendant.
-Although tort emphasizes in compensation, a plaintiff may wish to put a stop on some
certain behaviour e.g. noise.
-When suing in tort, a plaintiff has no need to specify the particular tort on which he relies.
-Same behaviour may amount to tort of nuisance and negligence. The plaintiff selects one
alternative to bring action and cannot claim both.

Trespass
The law recognizes trespass to include trespass to person, to goods and to land.
Trespass to person: It occurs if force is directly and intentionally inflicted on another person
for this purpose force means any physical contact. To punch on the face and to kiss someone
constitutes trespass. Kiss is an example of a case where someone can bring action even when
he has suffered no physical injury or loss.
However, where consent has been expressly or impliedly given it is a complete defense to
any action. For example, where one willingly holds out his hand for another to shake it or
where a patient willingly opens his mouth to allow a dentist to extract his teeth.
Trespass to Goods
This simply means wrongful interference with goods. It can take the form of either trespass or
conversion.
Trespass: is an intentional and direct act of interference by a defendant with goods in the
plaintiffs possession. The defendants action must be direct and intentional e.g. tearing a
page from your book, throwing a stone at your car or breaking a window. The defendant does
not need to deny the owner his right to possess the item.
Conversation: if the defendant commits some act which denies a plaintiffs right to possess
the goods this may amount to conversation e.g. taking the book away rather than tearing
some pages out of it, he has converted the book to his own use.
The principal remedy for any interference with goods is damages, but where the defendants
still posses control of the items the plaintiff can take delivery of the goods and payment of
any consequential damages. If the plaintiff prefers only damages, it will be based on the value
of the chattel together with any loss suffered.
Trespass to Land:
Trespass to land means unjustifiable interference with the possession of land. For the purpose
of this tort, land means- the surface of the earth itself, anything which is a fixture on it (e.g.
building), the air space above it to the extent necessary for the use and enjoyment of the land,
and the sub-soil below the land. The following can be a trespass:
a. walking over the land
b. throwing things onto the land
c. placing a ladder against the surrounding wall
d. swinging a crane jib over the land
e. flying an aeroplane over the land

Trespass protects possession of land. Where a person is in rightful possession, he can bring an
act against even the owner of the land. If a landlord rents premises to a tenants without
reserving the right of entry to those premises will commit a trespass. The tort is actionable
without prove of damage. The plaintiff can seek for an injunction to restrain his neighbour
from taking shortcut through his garden in Anchor Brew house Developments Ltd. Vs
Berkley House Ltd (1987), the courts grants injunctions to prevent over sailing by tower
cranes even where no damage is caused.
However trespass may be justified by express permission, implied permission or statutory
authority, or in exercise of a right of way e.g. implied permission to enter premises is the
open door of the supermarket. However, if a shopper creates a disturbance he may be asked
to leave. If he refused then it is a trespass.
It is not a defense to trespass and plead that the defendant did not know he was trespassing.
Even if he has lost his way he will be liable.
Nuisance: Three types of nuisance are:
1. Public nuisance
2. Private nuisance
3. Statutory nuisance
Public nuisance: Primarily a crime can consists of generating harm to members of the public
.e.g. obstructing public highway, allowing smoke from a burning field to blow across the
highway, polluting a public water supply or creating some projection over the highway.
It is usually a criminal prosecution case but a person affected can sue in tort. The plaintiff will
need to show that he suffered harm as a result of public disturbance greater than what
suffered by ordinary members of the public. Some behaviour can both be public and private
nuisance e.g. quarrying operations had caused dust on neighbourhood which is both public
and private nuisance.
Private nuisance: Is when one person unlawfully interferes with anothers use or enjoyment
of land. It has a wide range e.g.
1. Harm caused by smell, fumes, vibrations, noise, and dust
2. Encroachment by tree roots
3. Escape of sewage and the keeping of animals.
Your home is your castle; you are free to do what you want in it provided you do not spoil
your neighbours enjoyment of his own land.
In the case of Hunter V Canary Wharf, it was established that erecting a building that
interfered with a neighbours television reception was not a nuisance. The court applies the
principle of live and let live to determine whether theres nuisance or not. A plaintiff is

more likely to succeed if he can show actual physical damage. If simply complaining of
behaviour which causes him discomfort, then he must show that his complain is substantial
and one which ordinary men of ordinary sensitivity would complain about.
The court takes the following into account:

Duration of the nuisance relevant in establishing existence of nuisance and which

remedy is more appropriate e.g. damages or injunction.

The locality where the alleged nuisance occurs but where actual harm occurs. The
court inclines towards establishing a nuisance much more than when it is mere
discomfort. If a property is extraordinarily sensitive, or the use one wishes to put it is
in some way unusual or special, it becomes difficult to complain of nuisance. It is said
that you cannot increase your neighbours liability by using your own property in
some special or extraordinary way.

if a defendants behaviour has some public interest, the court consider and can accept greater
degree of noise and disturbance before behaviour amounts to nuisance e.g. early morning
delivery of milk.
Case: Miller v. Jackson:
Mr. and Mrs. Miller bought a house adjacent a cricket playing ground of a village pitch,
which has long been used before the houses were built. They then realized that it was
impossible to use their garden when play or practice was taking place. Sometimes balls fall
into the garden and bounce off the house, but no one yet struck. There was indeed nuisance
but, partly because of the public interest an injunction was denied.
Case: In Kennaway V Thompson, The noise from powerful motor boats was excessive out
of water sporting activities on a lake adjacent the plaintiffs house. The court agreed that it
was nuisance.
Case: Andrea V Selfridge and Co. Ltd, a plaintiff hotel owner was able to recover damages
from demolition contractor who had created excessive amounts of noise and dust. If works
were to be over in a matter of weeks, it may be reasonable to expect the owners of adjoining
properties to put up with the noise and dirt overtime. But if the contractor works 24hrs each
day, each week with constant noise of machines, vehicles and glare of arc lamps at night, his
activities may well constitute a nuisance.
Liability for nuisance:
Private nuisance is designed to protect a persons use or enjoyment of land. Plaintiff must
possess some legal interest in the land (as owner or tenant) mere license (permission to be on
the land) cannot take action in private nuisance. A mere quest or lodger cannot sue unless he
sustains physical injury, which he can only sue for injury.
Who can be sued?

1. Actual creator of the nuisance. If he sells the land and is no longer in position to right the
wrong, he is still liable since he committed the wrong in the first place.
2. The occupier of the land, if the nuisance was created by himself or his employees being
vicariously liable for their actionsde.
3. A trespasser, if he cannot be identified then the occupier. Even if it is an act of nature, once
the occupiers knows about it and take no steps, he becomes liable Example, a thunder storm
that causes fire on a tree. The occupier called someone to cut off the tree and fails to take
steps to stop the fire. It then spread to adjacent property he becomes liable in nuisance for
damage caused.
4. The tenant occupier. A tenant as the occupier is liable for a nuisance arising from the
premises. The landlord is only liable if-:
i. The nuisance existed before renting out the premises
ii. Where it is caused by disrepair of the premises which he is responsible.
STATUTORY NUISANCE
This kind of nuisance is covered by Act of parliament e.g.

Premises in such a state as to be prejudicial (harmful) to health or nuisance

Accumulations or deposits or animals which are prejudicial to health or a nuisance.

Emissions of smoke, gas, fumes, dust, steam or other effluvia.

Noise or vibration.

Prejudicial to health or a nuisance, is a state likely to cause injury to health. The

nuisance elements of the phrase can only be satisfied by showing what amounts to
nuisance at common law (as in public and private nuisance). A Statutory nuisance cannot
exist where there is merely an interference with personal comfort of the occupiers.
The Rule in Rylands V. Fletcher (1868): (Defendant made bulk storage of water in
reservoir)
It means if a set of given facts fits the requirements of the rules, then the defendant
becomes liable, whether he took care or not. The rule is usually stated thus:
Where a person for his own purposes, brings on to his land, and collects and keeps there
anything likely to do mischief if it escapes, he must keep it at his peril, and if he does not
do so, he is liable for all the damage which is a natural consequence of the escape.

The rule involves a number of points

1. The dangerous thing must be brought by the defendant to his land. No liability from
something which is natural on the land e.g. weeds or rock.
2. The thing must be likely to cause harm if it escapes e.g. oil, gas, explosives,
flagpoles and fairground equipment. The thing must not be intrinsically dangerous.
3. There must be escape i.e. not in defendants land when the harm occurred
4. The escape must cause damage (to person or property)
5.The defendant must bring the thing onto his land for his own purpose and in doing so
must be making a non-natural use of his land.
Defenses available to the defendant:
1. Fault of the plaintiff-if the damage is caused by the plaintiffs own wrongful act he
cannot recover.
2. Consent by the plaintiff-tenants on different floors of a building impliedly consent to
the presence of water supply running through the building. If flood occurs on an upper
floor causing damage to the lower floor there is no liability.
3. Statutory authority-an act of parliament which excuses his behaviour which will
otherwise be tortious.

NEGLIGENCE
Many more people are injured by carelessness than by acts which are intentional. Negligence
as a tort is a breach of duty owed the plaintiff to take reasonable care not to cause him
damage. e.g:-an employer must take reasonable care to ensure the safety of his visitors.
-an occupier must take reasonable care to ensure the safety of his visitors.
-manufacturers must take care that their products are not contaminated
Case: Snail in the bottle Donoghue V Stevenson (1932) a customer bought ginger beer in
a caf in opaque bottles. He shared one bottle with his friend and a decomposed snail came
out of the bottle causing the friend to fall seriously sick. She successfully brought a claim
against the manufacturer for negligence although there was no contract between her and the
manufacturers because she didnt buy beer. It was however decided by The House of lords
that the manufacturer owes a dirty to take reasonable care to see that his products are not
contaminated.
The tort of negligence is usually analysed under three main headings

1. A duty of care owed to the plaintiff

2. Breach of that duty
3. Damage resulting of the right type which is not too remote.

1. The duty of care

The rule is that you must not injure your neighbour, you must take reasonable care to avoid
acts or omissions which you can reasonably foresee would be likely to injure your neighbour.
Your neighbour is any person who is so closely and directly affected by your act or
omission that you ought to have him in mind when directing your mind to the act or omission
in question. Some areas constitute problem areas of the law of negligence. These are: Cases involving pure economic loss
Cases involving negligence misstatement
Judicial immunity situations
Nervous shock situations
Negligent exercise of statutory powers
Pure omissions to act.

2. Breach of the duty of care

If a duty to take reasonable care is owed to the particular plaintiff, the next stage is for the
plaintiff to prove that the defendant was in breach of the duty, i.e. that the defendant failed
to take reasonable care. The questions are- how much care should the defendant take?
What would amount to reasonable care in the particular circumstance? If the defendant
fails short of a reasonable standard then he is in breach of his duty.

The courts use some factors to measure reasonable care as:

The degree of risks involved in the defendants behaviour

How serious was the harm which was likely to be caused?

Was there any particular social value or utility in the defendants activities and

How costly and inconvenient would it have been to take precautions to eliminate or
reduce the risk?

The standard of care expected means that the defendants behaviour is assessed
against an objective standard and it is that the defendant tried hard or did his best. If a
defendant holds out himself as having some particular skill or capability e.g. an
engineer, doctor etc then he will be expected to display reasonable amount of that
skills or capability.

If a risk could be eliminated or reduced by reasonable expenses or practicable

precautions, then the defendant should have done what he could. But emphasis here is
that he is only required to behave reasonably.

Case: Latimer V AEC Ltd, oil normally ran away in channels in a factory floor. Oil
spread over factory floor when it floated. The factory occupier scattered some
sawdust, mopped up as much of the oil as possible, and gave a warning to employees
to take care because the floor was slippery. The plaintiff slipped and was injured, the
defendants were held not to be liable.

3. Damage resulting from the right type which is not too remote
The question of causation and remoteness is important. Causation is concerned with the
problems of whether the defendants conduct caused the plaintiffs damage. Remoteness is
concerned with the cut-off point which the law regards the defendant as no longer liable to
compensate the plaintiff. If such a cut-off point were not established, a defendant could
owe limitless liability:

Causation: a defendant may behave negligently towards a plaintiff and yet not be the
cause of his injuries in Barnett V Chelsea and Kensington Hospital Management
Committee, the plaintiff fell sick after drinking tea, and the doctor was negligent by
failing to examine the patient. The patient was dying from poison and nothing could
have saved him, so the doctors negligence did not cause his death.

Remoteness-The plaintiff must show that the harm he suffered was not too remote
from the defendants negligent act. When deciding the remoteness question a court
will consider:-

a. The defendant must take the plaintiff as he finds him-e.g. a driver knocks down a
plaintiff who suffers from a weak heart and dies as a result, he may argue that any
normal victim would only have been shocked and bruised.
b. The consequences of the defendants breach of duty may have been overtaken by
some act which intervenes- An employers negligence that cause injury to an
employee, an ambulance called to take the victim to hospital who crash and killed the
victim due to drivers negligence. The crash is then the new act intervening.

ALTERNATIVE DISPUTE RESOLUTION (ADR)

There are many ways of resolving disputes and differences known in recent times in addition
to litigation in the Courts of Law. While the latter involves some formal processes, the former
methods employ the use of informal processes to resolve the disputes. The alternative
methods of dispute resolution (normally written as ADR in abbreviated form) include
arbitration, conciliation and mediation etc. Although there are many ADR methods in use
today, Arbitration, Conciliation and Mediation are the three common ones. They have the
common advantage that justice or peaceful solution on the dispute is arrived at faster,
harmoniously, cheaply and privately. It shall be noted that whereas Court litigation is
conducted in an open (accessible) area in the public, Arbitration, Conciliation and Mediation
are conducted in private in a suitable and most convenient venue either chosen by the
disputing parties or the Arbitrator/Conciliator / Mediator. Amongst the three common ADR
methods, Arbitration is the most widely use particularly in the construction industry. For this
reason, emphasis will be given to Arbitration in this course.
Growth of ADR
While arbitration developed as a result of the apparent inability of the court to satisfy some of
the expectations of people in the resolution of disputes. ADR arose largely because the
arbitral process was becoming unduly expensive and long because of the gradual creeping in
of judicial technicalities of dispute resolution. Thus, there began a gradual shift of emphasis
from the use of arbitration on commercial dispute resolution to a culture of systematic use of
mediation and conciliation which are a formalized form of the age-long use of negotiation in
the settlement of disputes. The settlement is consensual. The conciliator or mediator only
helps the parties to come to a consensus. He does not adjudicate.
This gradual prominence of ADR is a result of the increasing dissatisfaction with the
adversarial arbitration process, the negative dispute management in court litigation and later
in arbitration which sees disputes only in terms of right and wrong and in which
disputants are either winners or losers and the mounting cost of arbitration all these go to
enhance the status of ADR as a better option for resolving disputes of whatever nature.

With particular reference to commercial disputes, apart from the fact that businessmen and
women prefer private resolution of their disputes instead of exposure to the machinery
available in the glare of regular courts, there is the advantage that settlement through ADR
avoids what may be called brinkmanship and violence which may arise in an adjudicator
system. It prevents either of the parties from losing face after the settlement exercise might
have been over. It breeds less hostility and antagonism and most importantly saves the
business relationship of the parties and so business may continue in an atmosphere of
cordiality as if nothing had happened. All these are possible largely because ADR provides
greater room for compromise than the adjudicator systems of litigation and arbitration.
The gravitation towards ADR has been welcome in every sector where commercial disputes
arise in the ordinary course of events. Indeed the literature on the subject has recently become
enormously overwhelming because of the increasing use of ADR processes in various fields
of human endeavour. In Britain at the moment, the use of adjudication as one of the ADR
methods is a Statutory right.
Definition of Arbitration
a.
Laymans definition
It is an agreement to refer present (during currency of a Contract) and/or future
dispute to a tribunal comprising one or more qualified person for his (or, their)
settlement. The dispute normally arises on any matter under or connected with the
Contract. The agreement is and must generally be in writing as provided by Section
(1) of the Arbitration And Conciliation Act of 1990, Cap, Laws of the Federal
Republic of Nigeria; oral agreement are rare and may suffer problems of enforcement.
It may also be difficult and unsafe for the Arbitrator to work on an existing claimed
verbal agreement between the parties to refer dispute to arbitration. Dispute is
anything or matter on which the parties to the contract or their agents on the formers
behalf are unable to agree on a common stand point. Tribunal is the body authorized
by law (e.g. Claimant) or parties to the contract to settle the dispute. Qualified
person(s) refer to as a personality or Tribunal educated or learned in the subject matter
on which the dispute arose and may include Architects, Quantity Surveyors,
Engineers, Lawyers and many others. The Tribunal or person appointed to settle the
dispute is called an Arbiter or Arbitrator and his duty is to arbitrate between the
parties speedily and in the simplest, honest, impartial, unbiased and straight forward
manner using the legal instruments at his disposal (e.g. ACA 90; Equity; Common
Law and general practice of the trade involved) and documents submitted to him by
the parties to the contract. He is not normally expected to import unrelated document
to settle the dispute else he may be accused of misconduct; he must arbitrate upon
only matters referred to him and must arbitrate on nothing else.
b. Dictionary definition (Oxford Advance Learners)
Oxford Advanced Learners Dictionary of Current English by A.S. Hornby defined
arbitration as an attempt at settlement of a dispute by the decision of a person or
persons chosen and accepted as judges or Umpires.

c. Legal definition
Where two or more persons agree that a dispute or potential dispute between them
shall be decided in a legally binding way by one or more impartial persons in a
judicial manner, that is, upon evidence put before him or them, the agreement is called
an arbitrate on agreement or a submission to arbitration. When a dispute has arisen
and it is put before such person or persons for decision, the procedure is called
arbitration, and the decision when made is called an award.
Conciliation
This is normally the process of helping to achieve settlement of trade Union disputes between
Employers and Employees or Trade Unions. It is quite possible for conciliation to be
employed to settle dispute where arbitration should have been employed. Whereas the
arbitrators award is final and binding between the disputing parties, the decision of a
conciliator is neither final nor binding between the said parties. In fact, whereas in arbitration,
an Arbitrator is settling the dispute himself through an unbiased, impartial and honest
award without any form of misconduct, the conciliator in conciliation processes is helping
the disputants to settle the disputes themselves, he does not settle the dispute for them, they
settle the dispute themselves.
In England and various parts of Continental Europe, people regard Conciliation as the
dominant omnibus term to describe amicable or non-adversarial problem solving activity. The
Conciliator needs to be a person of national standing, known integrity and full of diplomatic
and social skills; private, removed from the area of public discussion. Intensive persuasions
are employed and acceptable solutions are reached without recourse to law. Unnecessary
expenses and recourse to Court of Law or arbitration are avoided. In the words of late John R.
W. Alexander, Past President of the CIArb, The words conciliation and arbitration,
especially in industrial disputes, are commonly loosely used, arbitration sometimes meaning
no more than Conciliation. The distinction should be that the Conciliator endeavours to
resolve a dispute by assisting the parties themselves mutually to agree terms of settlement,
whereas the arbitration makes his own decision and impose it upon the parties in the form of
an award, the parties normally being obliged to accept it. No matter the similarities,
arbitration and conciliation should be compared with caution, for in origin, purpose and
procedure they are very different.
Mediation
Mediation is a half-way house between conciliation and arbitration. The independent
mediator not only conciliates but also makes his own formal recommendation which,
although the parties are not committed to them in advance, may later be accepted as they
stand or provide the basis for further negotiations leading to a settlement. Unlike an award
from arbitrator, the mediators recommendations are not binding to the parties.
Although a Mediator is recognized to be more powerful and influential than a Conciliator, the
disputing parties are not obliged to accept his opinion. The Mediator, plays a purely
interventionist role. The essential feature of mediation is that the Mediator leads the parties

themselves to reconcile their differences. He tries to find common ground between them (the
parties), facilitates negotiation and creates the condition for a settlement. The simplest form
of mediation is a go-between who overcomes a breakdown in communication between the
disputants by traveling to and fro (between them) in an attempt to reduce their differences.
The mediator thus helps the parties to reach a point of accommodating their differences. The
arbitrator, on the other hand, is someone whom the parties have chosen to reach a decision for
them.
Thus a mediator is an intermediary and a medium for bringing about an agreed settlement by
the parties. Unlike in arbitration where hearings, meetings and site inspections are held
together and at the same time in the presence of all and sundry, in mediation, the mediator
hears each party separately and privately. After understanding their respective points of
view, he ensures that each party appreciates the other partys position on the dispute. He
brings both sides together so that they arrive at a compromise themselves. Unlike a
Conciliator, a Mediator does not prepare any terms of settlement. The Mediator decides
nothing whereas the Conciliator decides what the terms of settlement should be (but with the
joint agreement of the disputing parties). Generally, both Mediator and Conciliator are
disqualified from becoming an arbitrator in respect of the same subject matter upon which he
mediated/conciliated.
Negotiation
In this paragraph we shall consider briefly the ADR process of Negotiation. In the next
paragraph we shall consider conciliation and mediation and thereafter, mini-trial and MedArb. An indispensable step in any ADR process is negotiation. It is a fundamental key to all
consensual ADR activities and I fact the most satisfactory method of settling disputes. Ability
to negotiate is inherent in that it is an art which is learnt from the earliest stage. Usually
negotiation consists of a quid pro quo of a sort that is giving up something in order to get
something in return. It involves discussions or dealings about a matter, with a view to
reconciling differences and establishing areas of agreement settlement or compromise that
would be mutually beneficial to the parties or that would satisfy the aspiration of each party
to the negotiation. Compromise here implies flexibility on both sides and flexibility derives
from a genuine desire on the part of the parties to reach an agreement.
Each adult person would at one time or the other have consciously negotiated one agreement
or the other personal and financial and we all might have developed our own individual
approach in trying to persuade others to give what we want, which is what negotiation is all
about.
MINI-TRIAL
The mini-trial is a form of evaluative mediation which as a non-binding ADR process assists
the parties to a dispute to gain a better understanding of the dispute, thereby enabling them to
enter into settlement negotiations on a more informal basis. Mini-trial usually takes the form
of a short presentation of the issues by the respective in house lawyers of the parties who now
sit together on the opposite side of the table facing both disputants, or in the case of

corporations, their Chief Executive (decision-makers). The disputants literally become the
jury assisted by a neutral expert who may be a former judge or some other person with
authority in the field of the dispute, selected as neutral adviser to elucidate any problems
which may arise during presentation. The executives ten retire and try to negotiate a
settlement. This enables them to view the dispute in a better perspective and helps them settle
in a more dispassionate manner. Here, as in Mediation, the neutral person can have a
significant role by acting as a facilitator of the parties negotiations. This ADR method of
dispute resolution is fairly foreign (new) to this country.
MED ARB
In Med-Arb which is an abbreviation for Mediation Arbitration, attempt is first made to
resolve a dispute by agreement through Mediation, and if that fails, them it proceeds to a
binding Arbitration. The advantage in this is that if settlement cannot be reached, the initial
Mediator can now be appointed the Arbitrator entrusted with the duty of making a binding
determination, especially if during the course of the Mediation a relationship or trust has
developed between the Mediator and the disputants. If on the other hand, both or any of the
parties developed mistrust on the Mediator in the cause of the Mediation processes, then he is
unlikely to be allowed to continue with the dispute resolution as an Arbitrator.
In the Med-Arb process, the decision to go to Arbitration if Mediation is unsuccessful is one
to which the parties commit themselves in advance, before the process commences. In this
regard, it has been said that ..this offers the advantages, real or perceived, that first, the
process will produce a resolution, one way or another, secondly, that parties may perhaps try
harder to be reasonable and to resolve the matter during the Mediation phase; and thirdly, that
if adjudication is required, there will be no loss of time or cost in having to re-acquaint a new
neutral person with the facts of the issues between the parties.
These procedures of Conciliation, Mediation, Mini-Trail and Med-Arb are generally much
cheaper even than arbitration, provided they work; it is the duty of the disputants and the
neutral person to make the said ADR methods work. As the Rt. Hon. the Lord Roskill had it
in 1987, So long as human nature is what it is, there will always be disputes. And those
disputes, whatever their character, must be resolved if society is to live in a civilized way as
quickly, as cheaply and as satisfactorily as possible.
ADVANTAGES OF ARBITRATION OVER LITIGATION

The parties can choose the arbitrator or arbitration tribunal. If they cannot agree
upon a particular person or persons, they can almost invariably agree upon some
institution to make the appointment, and thereby agree upon the qualifications of
the person or persons to be appointed. For example, the President of the Chartered
Institute of Arbitrators or the President of the Nigerian Institute of Construction
Industry Arbitrators is likely to appoint someone known to be experienced as an
arbitrator; the President of the Nigerian Institute of Architects is likely to appoint
an architect with experience of arbitration; and so on. In the last resort, if the

parties cannot even agree upon an appointing institution, the High Court will
appoint an arbitrator and before doing so will consider any submissions as to what
qualifications the person appointed should possess.

Many disputes can be resolved on documents without a hearing. Thousands of

disputes are resolved each year in this way, not only quality disputes and rent
reviews as already mentioned, but also a rapidly growing number of consumer
disputes and construction industry disputes.

It is less likely to stimulate antagonism between the parties than proceedings in

the courts.

If a party to a contract does not wish to be exposed to the decision of one man,
with the consequential possibilities of idiosyncrasies or ignorance, he can stipulate
for arbitration by a tribunal of three, one of whom is to be appointed by him. This
possibility is of particular importance where the parties to a contract are from
different countries or cultures; each can be sure that the tribunal will include at
least one member familiar with his country or culture. This freedom is not
available where the case is decided by a Judge in law court.

Except in the tiny number of cases in which the right of appeal has not been
excluded by agreement and leave to appeal is given, the procedure is private, selfcontained and final. In comparison with court proceedings the risk of costs and
delays due to appeals is minimal.

The hearing (if there is to be one) and any preliminary meetings can be held in a
place of the parties choice. Apart from its great convenience in some cases, it can
be in neutral territory rather than on what is perceive to be the home territory of
one party.

Arbitration by a tribunal chosen with speed in mind can be far quicker than
litigation.

The parties have a wider choice of procedure than in litigation; including, if they
wish, replacing the traditional adversarial procedure by an inquisitorial procedure
for issues for which is more appropriate, as used in other countries.

The tribunal can take part in the preparation of the issues for adjudication; can
help to strip out the inessentials; and can read the documents before, rather than at
the hearing. This can enormously shorten the hearing and reduce the costs.

Parties can represent themselves or be represented by anyone of their choice.

Rights of audience by representatives are not limited to lawyers as in the courts;
and in particular a company or corporation can be represented by a director.

Arbitration is acceptable to many states institutions which for reasons of national

prestige would be unwilling to submit to the jurisdiction of any foreign court.

However, if arbitration is to continue enjoying most of the advantages then the Arbitrators
must not only be thoroughly qualified in their original professional disciplines but also in
arbitration as a subject (profession) and preferably fairly learned in law. From experience, the
best arbitrator may be one qualified in the subject matter of the dispute as well as in
arbitration and law (a lawyer). He may not be the best arbitrator even then unless he is
prepared to administer proper justice in resolving the dispute honestly impartially without
bias and without misconduct of any form.
It is important to face the fact that badly conducted arbitration can lead to risks of injustice
and frustration for either or both of the parties for which there will be no similar redress as in
the court. The calibre, experience and industry of the tribunal, and the nature and quality of
the procedures employed in individual cases are therefore of paramount importance.
For arbitration to maintain its advantages as an alternative to litigation, all those concerned in
it, that is; parties, solicitors, barrister, other professional representatives, expert witness and
above all arbitrators must therefore become familiar with the special features of this process,
both good and bad. They need to be aware not only of the procedures usual in their own
particular field or expertise, but also of the general range of procedures available. For
example, much arbitration is conducted so formally as to have been called litigation without
wigs. These results more from an unthinking adherence to what has always been done by
lawyers, than to a conscious decision that litigation procedure is the most appropriate to the
needs of the case.
Lawyers in arbitration do not follow litigation practice because they are determined to do so.
They tend to follow it because they are used to it and because any departure which may be
suggested involves unfamiliarity, the need for inventiveness, and above all the risk of
something going wrong for which they may be blamed. But they are not fundamentally
obstructive merely cautious.
Arbitral tribunals should always be alert to prevent discovery or cross-examination from
absorbing a time and efforts wholly disproportionate to any advantage that can reasonably be
expected to flow from them. They should be adaptable to the needs of their particular dispute.
DISADVANTAGES OF ARBITRATION OVER LITIGATION
These are generally few and may include the following among others:a.

Right of appeal is limited and unless clear case of bias, misconduct and
partiality are established against the arbitrator, his decision (Award) is final
and binding on the parties.

b.

If appeal against the award is successfully allowed and litigation proceeds

thereafter, more time may be required before justice is obtained.

c.

Arbitration loses its privacy and become a public hearing (in Court) if the
award is successfully challenged and subsequently set aside.

d.

May lose it advantage of speed if the hearing is cumbersome and the arbitrator
allows lawyers (as Counsels for the disputants) to argue unnecessarily, thereby
dragging the matter for a much longer time than necessary. Despite the need
for flexibility on his part, the arbitrator must be firm but fair and always
assume full charge for the hearing; he is to be master of the procedure not
servant/follower of the procedure.

FORMS OF ARBITRATION
This depends on the contents of the arbitration agreement entered into by the disputing
parties. There may be occasions when the arbitration agreement may be completely silent as
to the form the arbitration will take. Two forms are normally recognized, that is:a.
Arbitration purely based on documents and no oral hearing is conducted or
b.
A hybrid of both documents and oral hearing.
In the case of (a) above, the disputing parties or their Counsels/experts on the formers behalf
compile all the necessary documents (files; books; drawings; bills of quantities etc.) and send
same to the arbitrator for his study and preparation of a suitable award.
The arbitrator is free to liaise with the disputants (normally in writing with copy of the
enquiry to all the parties) if any section of the documents is ambiguous or needs further
collaboration. When the relevant party responds to the enquiry, he must send copy to the
other party to the contract.
In the case of (b) above, complete set of documents on the contract or subject matter of the
dispute are sent to the arbitrator in advance of the hearing. Unless all the parties are in
possession of the same documents sent to the arbitrator, copies thereto shall be distributed to
all the parties concerned. When the documents, the written claims and written defences are
submitted to the arbitrator and all the parties concerned, a date is fixed for the preliminary
hearing (preliminary meeting) and future subsequent hearings. These constitute the oral
hearing and the arbitration is said to be a hybrid of both documents and oral hearing. Based
on the evidence adduced by the parties and their representatives (if any) at the hearing and the
sets of documents submitted prior to the hearing, the arbitrator subsequently and finally
comes up with his award.
Out of the two main forms of arbitration described above, the most commonly used is
arbitration based on combination of documents and oral hearing. This preference is mainly
due to the need for records and documents.

THE ARBITRATION TRIBUNAL

This is the body that presides over the disputes (reference) and gives an award at the end of
the hearing. The tribunal may be only one (1) person or three (3) or five (5). It must be noted
that the larger the number of arbitrators on a particular hearing, the longer it takes to decide
on the dispute which may thus defeat one of the most important advantages of arbitration.
(i.e. speed). The tribunal may also comprise two (2) arbitrators and an Umpire as a third
person. Umpire has no power unlike an arbitrator who has all the powers conferred on him by
law. A tribunal of an even number is not only bad but abnormal e.g two or four arbitrators;
this is because majority decision may be difficult or impossible to obtain especially if the
tribunal comprises only two arbitrators. On the other hand, if the tribunal comprises odd
number of arbitrators, for example, 3 or 5, then majority decision is always possible. That is,
two arbitrators may have same view in a tribunal of three (3) persons while only one has a
different opinion; in this case, the award is still valid and binding on the parties.
The cost (fees) and expenses of the Umpire is also borne by the parties to the dispute. In a
complex arbitration where the dispute covers many different technical issue and the parties on
the contract belong to different nationalities and probably subject (the parties) to different
laws, then a tribunal of many arbitrators (e.g. five) may be absolutely necessary because one
arbitrator may be technically incompetent or in capable of resolving the dispute (NOTE that
the single arbitrator is free and entitled to engage experts to advise him and conduct the
hearing together with him, so he may not be totally incompetent/incapable to resolve the
dispute).
PROCEDURE FOR CONDUCTING THE REFERENCE (HEARING)
There is no specific and any rigid procedure applicable to all arbitration proceedings. One of
the major advantages of arbitration is that, unlike a court procedure which is right, traditional
and somewhat customary, the procedure in an arbitration hearing is completely flexible,
variable and more or less completely at the mercy of the arbitrator(s) unless the parties to the
dispute dictate otherwise. Where the parties select a particular procedure to govern conduct of
the proceeding, the arbitrator has no option but to follow and adhere to that particular
procedure selected by the parties; however, even in this case, the arbitrator can advise the
parties and vary the procedure selected by the parties if same (the procedure) proves complex
or defective or inoperable.
The procedure to be adopted for the proceedings does not only depend on the parties or the
arbitrator(s) but the type of commercial activity in question and the type of dispute that arose
between the parties. The procedure to be adopted for the proceeding may even depend on the
nationalities of the parties involved in the dispute. Be that as it may, one may summarily say
that the procedure to be adopted for conducting the hearing depends on the parties to the
dispute and the arbitrator(s) appointed to resolve the dispute. Before starting to proceed with
the hearing, the arbitrator must make sure that there is an arbitration agreement, he has been
properly appointed, he has properly accepted the appointment and that he has full jurisdiction
under the agreement to settle the dispute (claims etc) that is referred to him.

The procedure to be adopted throughout the hearing is normally agreed upon during the first
meeting which is called PRELIMINARY MEETING or PRELIMINARY HEARING. The
latter is to be duly attended by the arbitrator (who is the right and only party who fixed the
date for the preliminary hearing, but the date has to be convenient to both or all the parties to
the dispute), and the parties themselves. It is at this meeting the parties inform the arbitrator
about the names, qualifications, address, telephone numbers etc of all the experts, counsels
and witness they (the parties) wish to invite on the reference to represent them (the parties)
and defend their respective cases. However, if the experts; counsels witnesses have been
agreed upon (as to who they are) prior to the date of the preliminary hearing, then all of them
and the actual parties to the dispute and the arbitrator(s) attend the preliminary
meeting/hearing.
The most fundamental issues to be agreed upon at the preliminary meeting are (1) the nature
and scope of the dispute (e.g. all the claims and anticipated defences plus any counter claims)
(2) the dates of all future meetings and date of visits to the site of the project on which the
dispute manifested or the dates of inspection of properties/goods which are the subject matter
of the dispute and (3) date of issuing the final award and dates of issuing
interim/interlocutory awards (if relevant).
It is also during the preliminary meeting the timetable for submitting the claims, defences and
counter-claims is agreed upon. It is often possible that prior to the date of the preliminary
meeting, a zealous and organized claimant might have already prepared his Points of Claims
(or Statement of Claims) and is ready to present same to the arbitrator with enough copies for
the Respondent. In the latter case, the length (time duration) of the hearing is shortened and
the arbitrator simply collects his copy of the Points of Claims and directs the Claimant to give
copy or copies to the Respondent at the same time there and then. It is now the duty of the
arbitrator to assess a reasonable time period it will take the Respondent to prepare and submit
his defence and counter claims (if any), that is, the statement/Points of defence.
The mere fact that the claimant has already prepared and submitted his claims more or less
ahead of schedule, does not mean that the Respondent shall be unfairly treated (by the
arbitrator) and rushed to an earlier period of time within which to submit his Points of
Defence i.e. a time period earlier than what amounts to a fair and reasonable time period.
When a convenient and realistic timetable is agreed upon (during the above meeting) for the
entire period of the arbitration, the parties discuss other relevant issues such as the costs of
the reference (i.e. arbitrators fees and expenses), exchange of documents, discovery of
documents etc. if necessary, the timetable may still be changed at a later date to cater for
unforeseen contingencies.
Where the Points of Claims are not prepared and submitted to the arbitrator on the date of the
preliminary meeting, the arbitrator has to fix a time period (e.g. 14 days) within which the
Claimant shall prepare and submit his Points of claims. It is important to note that whatever
time period is given to the Claimant to prepare and submit his claims to the arbitrator, the
same length of period, no less no more, shall be given to the respondent to prepare and

submit his Points of Defence plus any counter-claims he may have against the claimant (e.g.
14 days). If a shorter or longer time period is given to the Respondent that will amount to an
unfair and preferential treatment of one party over the other and same will amount to bias and
misconduct on the part of the Arbitrator, which is a fundamental departure from some of the
essential requirements of arbitration. In the latter case, the award that will be given by the
arbitrator may be rightly challenged in Court and subsequently set aside. At any rate, the
Arbitrator must not allow a crazy respondent delay the proceedings unnecessarily and
intentionally. Where the Claimant fails to submit his claims, he arbitration is frustrated and
shall be discontinued. If the Respondent fails to submit defence over the claims, the
arbitrator(s) may serve him a reminder and give him a short time period within which to
submit the defence but if he (Respondent) still fail to do so, the arbitrator shall, this time,
ignore him and continue the arbitration proceedings without believing or ruling out rightly
that the failure of the Respondent to prepare and submit a defence is an admission of the
Claimants claims.
After submission of the initial points of claims and points of defence, the same period of time
shall be given to the claimant and Respondent to prepare defences and counter-claims. The
correct time period for all these is contained in the current rules and regulations of the
Institute of Construction Industry Arbitrators of Nigeria (ARTICLE 8). The parties and the
arbitrator are free to alter the time periods given under Article 8 of the Rules in order to suite
their convenience and circumstantial requirements.
The exchange of claims, defences and counter claims continue until such a time the real
points at issue (the actual differences between the parties) are fully and properly established
then the arbitration proceeding commences in earnest. The arbitrator will now have the task
of preparing an independent opinion (award) on the points at issue. The arbitrator may
allow revision of the claims and defences at any time during the proceedings provided doing
so is just and fair and will not unduly delay the proceedings to the detriment of the other party
and will not oust his jurisdiction totally to settle the dispute.
If the arbitrator suffers from any impediment that will not enable him to be impartial
throughout the hearing, he shall inform the parties accordingly and seek their consent whether
or not they are prepared to allow him continue with the arbitration despise this impediment. If
they agree for him to continue, then none of them will have the right to complain of partiality
at the end of the arbitration when the award is issued. The arbitrator, prior to commencement
of the proceeding, owes a duty to disclose in full and openly his relationship with both/all the
parties to the dispute (both social and business relationship) so that they are aware of his
limitations (if any) beforehand.
Depending on the complexity and number of the claims, the claimant may finish presenting
and defending same (the claims) on the date of the first hearing. If that is not accomplished,
the arbitrator adjourns the hearing until another date. When the hearing resumes, the claimant
continues presentation and defence of his claims while normal examination in chief and cross
examination also continues. The Respondent also presents his defences and counter-claims

during the hearing (meetings) at appropriate time as and when instructed to do so by the
arbitrator. He (the respondent) is similarly examined and cross-examined until the defence is
upheld or rebutted (demolished).
During the hearing, the parties and arbitrator may find it necessary to visit the site of the
project or inspect the properties/goods that are the subject matter of the dispute so that issues
that appear to be vague could be properly clarified or evidence presented could be
ascertained. It is necessary that all parties to the dispute and/or their authorized
representatives participate in the visit or inspection. The parties, representatives can only visit
the site or inspect the goods and properties with prior consent and approval of the arbitrator.
The arbitrator is free to visit the site or inspect the goods/properties at any other time on his
own without the parties. He cannot visit the site with only one or some of the parties involved
in the dispute. If the parties settle the dispute and differences amicably, although the
proceedings have since commenced, they shall notify the arbitrator in writing and the
proceedings shall thenceforth discontinue. He shall therefore issue an order for termination of
the arbitrator, publish an award by consent. The settlement notwithstanding, the arbitrators
agreed costs (fees and expenses) shall be settled by the parties probably on quantum meruit
basis since the reference (arbitration) has not been conducted to completion.
Although it is rare in building construction contracts for the nominated subcontractor and
nominated supplier to have any direct dealing with the Employer/Client or the latters agents
(architects, engineers, quantity surveyors etc.), it is still possible for dispute and differences to
arise between the said subcontractors/suppliers on the one hand and the client/employer or
the latters agents on the other hand. Since nominated subcontractors and suppliers are
employed by the Main Contractor, the former (subcontractors and suppliers) will go to
arbitration through and only through and only through the Main Contractor just like the way
they use the Main Contractors name to sue the Employer/Client. Such disclosure and consent
or dissent (from the parties) shall be committed to writing. If there is dissent (disagreement)
from any of the parties as to his (arbitrators) suitability to continue with the arbitration and
produce an honest and unbiased award, then it is advisable that the arbitrator shall DECLINE
from performing on the arbitration completely. These parties then agree upon then and choose
another arbitrator. If it has not been already agreed upon, the parties and the arbitrator may
agree at the preliminary meeting whether the arbitration shall be conducted on document only
(without oral hearing) or a combination of document plus oral hearing. It will also be agreed
at this stage the method of presentation of evidence, that is, whether non-expert witnesses
shall send evidence in writing (without appearing at the hearing) or whether they will appear
personal to give oral, as against written, evidence at the hearing on behalf of their Clients (the
parties). The same considerations are to be discussed and agreed upon in connection with the
evidence of expert witnesses.
Arbitration based on document only is rare in this country and are more prevalent where there
is no need to cross-examine the evidence given by the witness or expert. However, where
cross examination is necessary, then the arbitration must be based on document s and oral
hearing. When all preliminary issues, are agreed upon at the preliminary meeting, a date is

agreed upon for the first meeting on the matter. During the first meeting, the arbitrator will
call upon the Claimant (not the Respondent) to present and defend his claims against the
Respondent. He may present it himself (the claimant) or may call upon his council to present
it for and on behalf of himself (the claimant). If need be, his expert and non-expert witnesses
will also speak on his (claimant) behalf all in support and justification of the claims. When
they finish presenting the claims, examination in chief and cross-examination of the
witnesses (including the experts) take place until the claim is properly discussed and enough
guidance has been produce for the arbitrator to be able to form an opinion later on his award.
At any time during presentation and defence or rebuttal of the claim, the arbitrator may
intervene and ask questions as deemed fit. At no time shall the arbitrator try to indicate his
final view on any issue or try to help one of the parties improve upon his case. He must
remain completely neutral and unbiased through the hearing. As much as possible, the
arbitrator shall allow equal number of counsels; witnesses and experts to represent the
claimant and respondent. However, where it is inevitable that one party has more counsels or
experts or witnesses to appear on his behalf the arbitrator shall not disallow such
representation, the other party shall not complain and if he so wishes, he may also increase
the number of his representatives.
Having concluded the sittings and heard both/all the parties to the dispute and the various
evidences tendered, the hearing is closed. The arbitrator now decides and informs the parties
how long he will take to prepare and issue the award. He studies all the documents tendered,
considers all the evidences put forward before him then comes up with an equitable, honest
and unbiased award.
ARBITRATION AWARD
Like the arbitration agreement, the award does not have any special form or format before its
validity is maintained. It however has to be clear, precise and capable of compliance with and
enforcement in court of law (if there is appeal to the court). The award has to be complete and
touch on all matters referred to the arbitrator unless he/has already decided on some issues
(matters) through interim award. The Arbitrator shall not, on his own invent claims and
provide an award thereupon on behalf of one of the parties. Doing so amounts to both
partiality and misconduct.
The award must meet all the requirements stated in the current statute (Arbitration and
Conciliation Act 1990) e.g. has to be signed, dated; in writing; venue of issuance to be stated;
reasoned (unless the parties agreed otherwise) and preferably witnessed. If the award is not
complete; a supplementary award (in form of additional award) must be prepared and issued
within the specified period stated under ACA 1990. The additional award is issued by the
arbitrator on his own volition (e.g. if he notes that some of the issues referred to him were not
at all or properly treated) or at the request of one or both or all the parties involved in the
dispute. If the award is vague or unclear for any reason, the arbitrator shall interpret it within
the period stated under the statute (ACA 1990). He may interpret it on his own volition or at
the request of one or both or all the parties involved in the dispute.

The award shall state the time limit within which it must be honoured e.g. within thirty (30)
days from the date of issuance. The penalty for failure to honour its provisions within the
time period stipulated shall be given by the arbitrator e.g. if the sum of N100, 000.00 awarded
or part thereof is not paid to the claimant within 30 days from the date of issuing the award
(e.g. 10th March 1997), the respondent shall pay to the claimant simple interest (bank interest)
at the rate of 21% per annum on any amount which remains outstanding at the expiry of the
30 days. If the interest is to be compound interest as against simple interest the award
shall specifically say so.
The normal way of writing the award is to state the claim, then state the defence offered and
your findings as an arbitrator. Your final opinion may be deferred till the concluding stage
(summary). Each claim must be treated separately and individually. An award shall be given
on each claim and none (the claims) shall be grouped unless they (the claims) are all
fundamentally the same or similar and the respondent more or less offered the same or similar
defence to all the heads of the claims.
Under the ACA 1990 an award must be challenged within ninety (90) days from the date it
was issued otherwise the challenge may fail (refused by the court). For corrected or
interpreted or additional wards the 90 days take affect from the date the award was corrected
or interpreted or additionally issued. The award shall state the costs of the reference that is
the arbitrators professional fees and reimbursable expenses as well as deposits received by
the arbitrator and the balance due to him. On reimbursable expense full account of
expenditure incurred shall be given to the parties and any surplus money (unspent) shall be
retired to the parties by the arbitrator.
To ensure full payment of his fees and expenses by the parties, it is advisable that the
arbitrator does not release his award to the parties unless and until his fees and expenses have
been paid to him in full. The award shall state the proportion in which the costs of the
reference are to be borne by the parties e.g. equally (50% each) or so. The statute (ACA 90)
requires that in principle, the costs of the reference shall be borne by the unsuccessful party
(guilty party) otherwise, the arbitration tribunal may issue necessary directive to this effect.
It is a bad and inadequate defence for the respondent to state that HE IS NOT IN A
POSITION TO DENY or ACCEPT THE CLAIM. In this case, the arbitrator shall hold such
as inadequate defence to mean admission (acceptance) of the claim as per Supreme Court
decision in the cases of Lewis & Peat (NRI) Ltd V. A.E. Akhimien and Ogunola V. Eiyekole.

TRADE UNIONISM
Structure
Rights and liabilities
Settlement of industrial disputes

Essence of trade unionism is to enhance employer employee to enhances/ship between

employer and employee. In all, trade unionism is aimed at improving working condition.
The contract of employment is being referred to. In such as a contract, especially in big
organizations where thousands of employees could be found, disputes often occur due to one
reason or the other.
A trade dispute has been defined as a dispute, either between employers and employees or
between workman and workmen (fellow employees) which is connected with either the
employment or the conditions of work/service of any person.
Trade unionism is one great avenue through which trade disputes could be settled. A trade
union has thus been described as any combination of people, whether temporary or
permanent, the sole purpose of which are the regulations of the relations between employer
and employees, employees and employers, and between employers and employees. Trade
unionism is aimed at settling grievances. Most activities of trade unions are directed at the
improvements of working conditions such as leave right, rates of pay (wages), sick leave,
hours of work etc.
In the UK and other advanced countries, trade unionism started in the 18 th century but in
Nigeria the trade ordinance Act which gave a legal backing to trade unionism came in 1939.
Under that Act minimum of 5 persons can subscribe to a union and seek to get it registered.
The application for registration must be made within three (3) months of the formation of any
trade union. The Registrar of trade union after considering the application would normally
respond accordingly.
Grounds upon which registration could be denied a union include unlawful act and nonadherence to registration procedures as outlined by the Act.
Certain public organizations like the police force, the prison service and other
armed/paramilitary forces are exempted from trade unionism.
Trade unionism is open to all persons that are above the ages of 16 but only those that are
above 21 can hold posts of leadership.
All trade unions must keep records of accounts and render such account regularly or upon
request to the registrar of trade unions.
Trade unionism is prohibited from engaging in politics.
A trade union could be described as a collective means of achieving individual goals but not
as collectives with aims and functions of merely the sum of individuals.
Settlement of disputes
Circumstances such as subsequent changes conditions, which in a normal simple contract
could frustrate the contract, are under the contract of employment more often than not settled
by trade unionism. The trade union Act empowers trade unions to engage in collective
bargaining in the settlement of grievances/disputes. Trade unions especially by popular
opinion could choose any means of settling their disputes. This could either be by
negotiations or by strike. In the latter case, collective bargaining allows unions to apply to
employers for permission to hold a strike, permission which should not be unnecessarily
denied. In fact, if such permission is denied a union could apply to the Minister for Labour in
respect of such permission and the Minister will prevail to the employer to grant such; this is
all aimed at bringing to a peaceful settlement all trade disputes. In respect of negotiations, it

is realized that the leadership of trade union has a great role to play in the act of persuasion.
First, the leadership will need to persuade the unionists on the best line of action and also
should be good at persuading employers in granting the demand(s) of unionists. This is
sometimes not straight forward and the leader may have to employ all leadership virtues in
negotiating. Especially where government is involved, the leader may need some political
maturity in his business. It thus implies that, a union leader should or could be a politician.
Another avenue through which trade unions could use in settling disputes is through
arbitration.
In 1941, the trade disputes Arbitration and Enquiry Act was enacted. The purpose is the
establishment of an Arbitration Tribunal and a Board of Enquiry for the settlement of trade
disputes and for enquiring into economic and industrial conditions in Nigeria. Settlement of
disputes via, this channel implies an external interference either from the Ministry for Labour
(enquiry) or the Presidency (Arbitration).
The role of Government in Trade Unionism
Governments attitude (in the first Republic) has been that of maintaining industrial
democracy. It believed in voluntary negotiation and collective bargaining or what is
commonly called a laissez fairer policy.
The military government threatened the principle of industrial democracy by banning strikes
and lock-outs. The freedom of employers to negotiate wages was curtailed. They intervened
in the organization of trade unions under the policy of guided democracy. However, one
achievement of the military is the formation of one central labour organization (Nigeria
Labour Congress NLC).
Problems facing unions
Lack of proper knowledge in trade unionism: - Unionism belief that any person who
can hit the table call management names and behave rudely is best qualified to be a
leader.
Lack of education: Examples abound in Nigeria of union leaders who have all failed
to get secondary or higher education.
Selfish interest
Poor organization
Lack of finance
Over emphasis on wage increase

Trade unions
Structure
The structure of trade unions is such that there are 3 formal levels in a union. They are:
Union Local(ity)
State Level union
National Level union

A particular trade union should logically subscribe to a central trade organization. There had
been instances where more than one central labour organization existed but, currently in
Nigeria only the NLC is recognized as the sole labour central organization to which all the
legal trade or industrial unions should subscribe.
Even though the structure of trade unions is not too rigid, the three level structures are mostly
prevalent.
The union locality is the stage where members prominently feature. This is the level where
the actions is usually encountered, because it is at this level disputes often arise and it is there
that settlements are negotiated. It is also at this level that skilled hands or leaders are needed
in negotiating with employers. Influences from local levels to the superior levels are limited
to advice, administrative, financial, moral etc assistance. The strength of the local union
should be seen as the strength of the national union. One major issue that the local union has
to contend with is that of voluntary membership. While it was initially obligatory for workers
to belong to their trade unions, membership is now voluntary. Therefore, some members
belong to their unions either not to disappoint their friends or not to face the anger of their
colleagues. To such members, unionism is always viewed as at a time as money wastage.
Such members are often passive and their contribution to the union is highly limited, and infact, is forced on them by circumstances. Another problem of the local union is that both the
national and state levels could prevail on the local union in terms of lines of action etc.
Though the localism may argue that they are at the forefront of affairs and that they should
have pre-eminence in decision and causes of action, but then the higher levels often prevail,
though not necessarily always. Despite these problems the local levels is the centre of
attraction. At this local level, democratic principles are adhered to in the operation of the
union and such other things like election of leaders. Membership opinion is therefore given a
due regard in decision making and other activities. Remember how it was said that unionism
is a collective means of achieving individual goals (but not as collectives of merely the sum
of individuals). Any problem of one single member is seen as a union problem that must be
fought by all, for it could be another members headache tomorrow.