Nigerian courts will impose a duty to negotiate in good faith if the terms of these clauses are safe, and leave no room for presumption or speculation. The application of these clauses is based on the fact that they constitute binding contracts between the parties that must be respected and respected by the pacta sunt servanda principle. On appeal, the Court of Appeal agreed with the High Court and held that “for additional time, there must first be another agreement between the parties” since this had been agreed within the OSG. Accordingly, both parties were free to agree or argue over the duration of an extension, if any, without the duty to negotiate in good faith or to disable their own business interests (provided that the underlying contract did not indicate the opposite of what it did not).3 The term was the “very paradigm” of an unenforceable agreement. to give its consent. While such agreements may be commercially attractive, the question of whether or not they are legally applicable is quite another. It usually arises when one party decides not to proceed with the next phase of the undertaking and the other claims to have suffered one or more damage as a result of that decision. It should also be noted that Section 4(1) of the Lagos State Law Act (Chapter L81, Lagos State Acts 2015 provides that the parties to a contract act in accordance with the principles of good faith and fair trade) to exercise their rights and fulfill their obligations with respect to the nature and purpose of the treaty. In addition, Article 4, paragraph 2 of the Act provides that, in appropriate cases, a court may pay damages for intangible losses such as inconvenience, irritation, psychological distress and consequent damages resulting from the violation of the obligation of fidelity and conscience in the exercise of its contractual rights and obligations.
Morris was involved in a sales contract (the “SPA”) for shares of a company. The complainant received approximately $16 million as his first consideration. The OSG also provided for deferred consideration through a provision for benefits for the applicant`s counselling services. The OSG explained that the applicant had “the opportunity” to provide his advisory services between the parties for a period of four years from the close of the SG and “another reasonably agreed period.