JUST BEFORE YOU SIGN ANY DOCUMENT, CHECK AND CHECK AGAIN In our daily business as an entrepreneur or an employee or a public officer or as the case may be, we enter into transactions, we have reasons to sign varieties of documents. At times, it’s a contract, at other times, it could be a deed and at some instances, it’s a mere letter which implies the crystallization of a contract, it could even be a mere acknowledgment of receipt. These contracts have long lasting legal effects on the signers. When we enter into contracts, we create legal obligations merely by endorsing our signature on such documents. At all times, there is a cogent need for us, to carefully study the documents before us for execution and understand vividly the meaning of such documents before proceeding to endorse a signature on it. It is advised that, where it is perceived necessary, the services and opinion of a Solicitor should be sought, so as to avoid unintended liability or claims. The Court of Appeal in the case of Union Bank of Nigeria Plc & Ors v. Alhaji Ganiu Ajibola Ogunsoji (2013) 1 NWLR (Pt. 1334) 1 at 3 especially at pp 12-13, paras. G-D, on essentials of a binding contract, per Bage JCA stated that:- “Generally, there are three basic elements to the creation of a binding contract. These are offer, acceptance and consideration.” A contract entails offer, acceptance, consideration, intention to create legal relation and capacity. These elements are essential to the creation of a valid contract. A contract could be written or unwritten, implied or expressed. An agreement at most times is the substance of a contract. However some persons (under aged persons, insane persons) under the law are restricted from entering certain types of contracts. A scenario whereby Mr. A writes to Miss B, asking her to supply him 500 pieces of books, at the rate of N100 per book, such letter amounts to an offer. A reply by Miss B, that she is willing to supply all the pieces at the proposed price amounts to an acceptance. The N50,000 which is the total of purchase price for the 500 pieces is the consideration for the contract. A contact can be demonstrated by the conduct of parties, by their words, deeds or by documents that have passed between them. See the case of Mudiaga-Odje v. Y.P.S (Nig) Ltd (2014) 5 NWLR Pt. 1400, 412 at page 430-431, paras. G-B While signing agreements or contracts generally, you should be very careful and ensure you understand the contents of the document. This is necessary because once a document effecting the terms of a contract is signed, the content cannot be changed except on agreement of the parties to the contract. It is interesting to note that, even the court of law is barred from making a contract for parties. Our law is that, the court cannot make or change party’s agreement. Above all, it is not the function of a court of law to make agreements for parties or to change their agreement as made. See the case of African Reinsurance Corporation v. Fantaye (1986) 1 NWLR (Pt.14) 113 Now, before you endorse your signature on any document, agreement or deed (as the case may be), the following questions should be answered. Do I have the capacity to sign the document? Do I understand the content of the document? Does the document portray my intention? Have I sought the necessary professional opinion on the technical terms contained in the document? What are the claims and liabilities that may arise from my signing or otherwise of the document? When you are satisfied with the answers from the above questions, then you can proceed to sign the document or contract. Sometimes, you may erroneously leave important documents unsigned, it might interest you to realize that, an unsigned document cannot generate or initiate an action in the court of law. Under Nigerian laws, an unsigned document is entitled to no weight. It is incapable of being used by a court to resolve facts that are disputed in an action between the parties. See the cases of Garuba v. Kwara Investment Company (2005) 5 NWLR (Pt. 917) 160; and Tsalisawa v. Habiba (1991) 2 NWLR (Pt. 174) 463. However, you may sign some documents, which creates a contract, in which you intend to rely on and believe that you have created a legal interest in a certain subject matter, such hope could be jettisoned by a pinch of illegality in the contract you signed. This is because in event of disputes, the court will not help you enforce a contract that is illegal. Under our legal system, illegal contracts cannot be pleaded before the court, the apex court has consistently posited that, a contract or an agreement rooted in illegality must not be pleaded and, if pleaded, cannot be enforced by the law courts. See the case of Nnadozie v. Mbagwu (2008) FWLR (pt 405) @1639. Hence illegality in whatever form should not and would not be tolerated in the administration of justice, this is the position so that, the streams of justice would flow in purity. Another challenge regularly faced by parties to a contract is determining, what actually amounts to an illegal contract, a contract can be said to be illegal where:- 1- The consideration or an act under the contract or agreement is prohibited by the law. 2- The law requires an act to be done in line with that contract and such act is not done. 3- The law prohibits the parties from fulfilling the consideration or where a license or registration (and penalty is prescribed for failing to acquire such) is required and such has not been complied with. In the case of Thirwell v. Oyewumi 1990 4 NWLR PT.143 CA 384, the Court of Appeal opined that a contract declared void by statute may not be an illegal contract unless in relation thereto, there is also a penalty, imposed by law. The penalty makes it illegal. An agreement is illegal if, the consideration or the promise involves doing something illegal or contrary to public policy. See Nnadozie v. Mbagwu (2008) 3 NWLR Pt.1074 SC.363. A contract becomes an illegal contract once the act, substance, performance or promise in the contract involves doing something illegal or contrary to public policy or if the intention of the parties in making the contract is thereby, to promote something which is illegal or contrary to public policy. See First Bank Nig. Ltd v. Pan Bisbilder (Nig.) Ltd. (1990) 2 NWLR (Pt. 134) 647; Onyiuke III v. Okeke (1976) 3 SC 1; Alao v. A.C.B. Ltd (1998) 2 SCNJ 17; S.D.C. Cementation (Nig.) Ltd v. Nagel & Co. Ltd (2003) FWLR (pt. 156) 861, (2003) 4 NWLR (Pt. 811) 611; Opara v. Omolu (2002) 10 NWLR (Pt. 774) 177. So when next you sign a document or agreement that has legal implications, study the documents carefully and consult professionals where necessary. If you actually want to know if you have a valid and enforceable contract, do checks of the following:- Is there an offer? Is there an acceptance? Is there a consideration? Is there an intention to create legal relation? Do the parties have capacity to contract? Is the consideration or substance of the contract legal? Is the agreement one that requires to be stamped under the Stamp Duties Act? If it is, has it been duly stamped? Is the agreement one regulated by statute? If it is, have you complied? Was the agreement executed with an illiterate or blind? If yes? Is there an illiterate/blind Jurat It is advised that you consult and obtain professional opinions before executing any document/contract. It is also important to note typographical errors because a simple omission of a number in front on an amount without providing the wordings of such amount affects the contract fundamentally. For questions, send mail to omogbolahanoluyemi@gmail
Posted on: Sun, 19 Oct 2014 06:03:47 +0000
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