AFTER holding that there was no valid lease agreement between a private firm, Star Finance & Property Limited, alongside with its Chairman, Chief Stephen Bakare by a defunct commercial bank, Metropolitan Bank Limited, a Court of Appeal, Lagos, has ordered the former to refund a sum of N250 million, an amount paid to lease a Victoria Island property, Lagos State.The property is located at No 1087 Adeola Odeku Street, Victoria Island, Lagos State. Prior to the institution of this matter, the property, which was under construction, originally meant to be leased by the bank for a period of five years. The bank had planned to use the edifice as its corporate headquarters.But the Court of Appeal Justices - John Inyang Okoro, Kumai Bayang Akaahs and Sidi Dauda Bage, held that since there was no valid lease between the parties, no physical possession, a Memorandum of Understanding between the parties could not constitute a valid tenant-landlord relationship and as such the money deposited for renting the property should be refunded to NDICThe appellants, Star Finance and Property Limited and Chief S.O. Bakare had sought the intervention of the Court of Appeal, mainly seeking to upturn the conclusion reached by a trial court in a suit brought by NDIC, the liquidator of the distressed bank.Summarily, Metropolitan Bank Limited, which had since been liquidated and the first appellant signed a Memorandum of Understanding dated the 13th May, 2002 under which the first appellant was to grant a lease of some arts of its property. In furtherance of the MOU, the bank paid the sum of N250m in five installments to the first appellant as rent for the lease of the property.However, physical possession of the property was not given to the bank until the revocation of its licence in 2006. The respondent herein, NDIC, as liquidator of the defunct bank, brought the action at the Federal High Court to recover the money paid as rent, in order to pay same to the depositors of the bank. At the trial, each party called a witness to prove their case.After considering the totality of evidence at its disposal, the trial Judge held that the defunct bank did not take possession of the premises and that the parties did not enter into a formal lease agreement. On the counter-claim that certain works were done at the request of the respondent, the trial Judge held that the appellants failed to lead evidence to establish their claim and so, dismissed the counter-claim. The lower court then entered judgment for the respondent as per its statement of claim on 14th January 2009.Dissatisfied with the stance of the trial Judge, the appellants filed notice of appeal on 19th January, 2009,which was later amended, which distilled four issues:Whether the memorandum of understanding dated 13th May, 2002 between the 1st appellant and the defunct bank is a document evidencing an intention to create a lease or tenancy agreement as between the parties and whether the said tenancy was actually created.Whether the defunct Metropolitan Bank took possession of the 1st appellant's premises situate at No. 1087, Adeola Odeku Street, Victoria Island, Lagos or any part thereof and if so, did that establish the fact of the existence of a tenancy relationship between the parties.Whether taking into account the entire circumstances of this case, the 1st appellant was not entitled to rent for usage of its premises and if yes, whether the 1st appellant is obliged to make a refund of rent paid by the defunct bank in view of the existence of a tenancy relationship.''As contended by counsel to the appellants, Tunde Akinrimisi submitted that the agreement between the parties as evidenced in the Memorandum of Understanding was an ''intention of the defunct bank to lease or rent the 1st appellant's property.'' To him, the memorandum made by the parties herein on 13th May, 2000 was a lease known to law.For the respondent, M.A. Kazeem submitted and urged the court to hold among others that the learned trial judge rightly held that the memorandum does not constitute a lease, even though the appellants would have us believe otherwise.Reading his lead judgment, Justice Okoro said he thought that the trial judge was right to hold that based on available evidence, possession did not pass to the defunct bank, adding there was evidence that at the time the bank went under, the building was still under construction even though the bank had paid a whopping sum of N250 million.The Judge remarked: 'It is of interest to note that the second appellant was the former chairman of the bank and at the same time the chairman of the first appellant. It was under his watch that this transaction took place. I think he unfairly treated the bank in favour of the first appellant who was managed by his son. This is what is called insider trading, a practice, which always leads to the collapse of banks and any other business concerns. I need not say more except to add that the second appellant ought to do something quickly to alleviate the suffering of the shareholders of the defunct bank rather than dissipate energy to keep the money paid by the defunct bank to his company, the 1st appellant herein.'According to Okoro, the appellant and the bank made this transaction via a document, the Memorandum of Understanding and that the document was meant to guide this transaction, reasoning that if there was a handling over of possession, it would have been through a formal lease as envisaged by clause 9 of the memorandum.'The general rule is that where parties have embodied the terms of their contract in a written document, extrinsic evidence is not admissible to add to, vary, subtract from or contradict the terms of the written instrument.'There is no doubt that the consideration for which the sum of N250million was paid by the bank has completely failed. The law is settled that a party who has paid money to another person for a consideration that has totally failed under a contract is entitled to claim the money back from the other party. All the issues were resolved in favour of the respondent.'On the whole, having resolved the three issues against the appellants, I hold that this appeal is devoid of any scintilla of merit and is hereby dismissed. The judgment of the lower court delivered by Justice Tijani Abubakar on 14th January, 2009 is hereby affirmed. The respondent is entitled to costs, which I hereby assess at N50, 000.00 in favour of the respondent. Two other justices concurred with the lead judgment.
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