Measure of damages in a claim for wrongful dismissal
"...The appellant's counsel inveighed against the above reasoning and conclusion of the lower Court, [paragraph 3.21, page 12 of the appellant's brief]. In doing so, he would seem to have wished away numerous decisions on this Court on this point. Remarkably, however this Court has ware-housed a robust corpus of jurisprudence on the measure of damages awardable in circumstances such as those present in the instant appeal. In the first place, I endorse the conclusion of the lower Court that parties are bound by the terms of their contract. If the conditions for the formation of a contract are fulfilled by the parties thereto, they will be bound. It is not the function of a Court to make a contract for the parties or to rewrite the one which they have made, U.B.N. v. Ozigi (1994) 3 NWLR (Pt. 333) 385, 404. Thus, unless it is established in evidence that a party was fraudulently led into an agreement, parties are bound by the written and express terms of their contract, Chidoka v. First Finance Co. Ltd (2012) LPELR-9343 (SC); In other words, in the absence of fraud, duress and undue influence or misrepresentation, the parties are bound by their contract, Makwe v. Nwukor (2001) 7 SC (Pt. 1) 1, 38; My Lords, I cannot find any justification for disagreeing with the above conclusion of the lower Court. Under the common - and Nigerian - laws, the position is that, ordinarily, a master has the right to terminate his servant's employment for good or bad reasons or for no reason at all. The basic principle considered normally in the resolution of a dispute between a master and his servant where the former determines the latter's appointment is the determination of whether the contract of service between the two of them is one with statutory-colouration/flavour. Where the servant is removed in a contract with statutory flavour, the first question the Court would ask is: has the servant's employment been determined in accordance with the way and manner prescribed by the statute under reference? Or, is the contract governed by an agreement of the parties and not under any statute? Where the servant is sought to be removed in a contract with statutory flavor, that is, a contract of employment wherein the procedures for employment and discipline, including dismissal, are clearly spelt out, such a contract must be terminated in the way and manner prescribed by the statute. Any other manner of termination which is inconsistent with the relevant statute is void and has no effect. However, in other cases governed only by agreement of the parties and not by statute, removal by termination or dismissal would be in the form agreed to. Any other form of dismissal or termination connotes only wrongful termination or dismissal. It therefore does not warrant a declaration of such dismissal as void. Where this happens, the only remedy open to the plaintiff is a claim for damages for that wrongful dismissal and not reinstatement. This is based on the notion that no servant can be imposed by the Court on an unwilling master even where the master's behaviour is wrong. For his wrongful act, the master is only liable in damages and nothing more, Chukwumah v. Shell Petroleum Dev. Co. Ltd. (1993) 4 NWLR (Pt. 289) 512, 560; What flows from this latter category, that is, in cases governed only by agreement of the parties, and not by statute, is that the measures of damages recoverable in situations of wrongful termination or dismissal of a servant are determined by what the employee would have earned over the period of notice required for the determination of the employment, Nom Ltd v. Daura (supra); N.P.M.B. v. Adewunmi (1972) 11 SC 111; Mayne and McGregor on Damages (12th edition); paragraph 608. Simply put, therefore the measure of damages in cases of wrongful dismissal of this category is always the amount of money that is payable during the period of notice to be given by the employer as stipulated in the contract of employment, Nigerian Produce Marketing Board v. Adewunmi (1972) 11 SC 111; In all therefore, I take the view that the lower Court correctly stated and applied the applicable principle of law in a master and servant relationship. In International Drilling Company (Nigeria) Limited v. Moses Eyeimofe Ajijala (1976) 2 SC 64, 73-74, this Court made the point that: The principles of law governing the award of damages were stated recently by this Court in: Western Nigeria Development Corporation v. Jimoh Abimbola (1966) NMLR 381, 382; and Nigeria Produce Marketing Board v. A. I. Adewumi (1972) 1 All NLR (Pt. 2) 433, 437. In the latter case, we stated the law as follows at p. 437: In a claim for wrongful dismissal, the measure of damages is prima facie the amount that the plaintiff would have earned had the employment continued according to contract, Beckham v. Drake (1849) 2 H. L Cas 579 at pages 607-608. Where however the defendant, on giving the prescribed notice, has a right to terminate the contract before the end of the term, the damages awarded, apart from other entitlements, should be limited to the amount which would have been earned by the plaintiff over the period of notice, bearing in mind that it is the duty of the plaintiff to minimize the damage which he sustains by the wrongful dismissal. The application of this principle was vividly demonstrated by this Court in the case of Western Nigeria Development Corporation v. Jimoh Abimbola, supra, where Ajegbo, JSC, (delivering the judgment of the Court), after stating the guiding principles, said at page 382: The plaintiff was given a letter of appointment (Exhibit A)... The plaintiffs appointment was governed by the contract to which he entered at the time of his appointment. If he had been given one month's notice before termination of his appointment, he would have had no claim whatever on the Corporation. But he was not given notice, and he is entitled to one month's salary in lieu of notice. That is all he can get as damages. Other matters that the Judge considered are irrelevant."
What remedy is available to an employee whose employment was terminated without the requisite notice
"It is trite that where the contract of employment itself provides a procedure for the termination of the employment, the procedure as provided must be complied with to effectively bring the employment to an end. An employer who terminates the contract with his employee in a manner not envisaged by the contract will be liable for damages for the breach of the contract and that is the employee's only remedy. It follows therefore that an employer who has the right to hire has the corresponding right to fire as well. Thus, without any reason, the employer can terminate the employment of his servant and render himself liable to pay damages and such other entitlements of the employee that accrued at the time of the termination only. The Court, except where the employment is especially protected by statute, cannot compel the employer to re-instate the dismissed employee. See Olarewaju v. Afribank (Nig.) Plc (2001) LPELR-2573 (SC), Olaniyan v. University of Lagos (1985) 2 NWLR (Pt 9) 599, Osisanya v. Afribank (Nig) Plc (2007) LPELR-2809 (SC). In the instant case where the terms of employment provide for specific period of notice before termination or salary in lieu thereof, the only remedy available to the appellant is the award of salary for the period of notice and other legitimate entitlements due to him at the time the employment was terminated and no more. See Katto v. C.B.N. (1999) 6 NWLR (Pt. 607) 890 and Gabriel Ativie v. Kabel Metal Nig. Ltd (2008) LPELR-591 (SC). In correctly applying the law to the facts of the instant case, the lower Court held:- "All that the appellant is entitled to is one month salary in lieu of notice and any other entitlements legitimately due to him at the time of termination of his employment and nothing more." The foregoing being a correct and just enforcement of the terms of the contract between the parties must persist.
Per MUHAMMAD, J.S.C. IN PETER ONYEACHONAM OBANYE v. UNION BANK OF NIGERIA PLC (2018) LPELR-44702(SC)