JUDGMENTS OF THE NIGERIAN COURTS OF JUSTICE
Restoring Nigeria's Law to Nigeria's People - One by One
CELTEL NIGERIA BV
ECONET WIRELESS LIMITED
The appeal is against the
Judgment by the High Court of Justice of Lagos State
(the court below), by which it refused to set aside an
arbitral award entered by an arbitral tribunal in
respect of disputed Shareholders Agreement between the
1st respondent and the appellant together with the other
In outline the 1st respondent initiated an action at the court below seeking some declaratory reliefs against the other respondents and the appellant. While the action was pending, the 1st respondent issued a notice of arbitration against the other respondents and the appellant alleging breach of the Shareholders Agreement between them.
Pursuant to Clause 25 of the Shareholders Agreement containing the arbitration clause, the 1st respondent wrote to the then Chief Judge of the Federal High Court (Ukeje, CJ) to appoint arbitrators to settle the dispute. Ukeje, CJ, declined to make the appointment. The 1st respondent by its suit at the High Court of Justice of Lagos State invoked the jurisdiction of the court to make the appointment. Before the court could make the appointment, the 1st respondent re-applied to the Chief Judge of the Federal High Court, (Mustapha, CJ), who had replaced Ukeje, CJ in office to constitute an arbitral tribunal to settle the dispute.
Mustapha, C.J. granted the
request. He caused a three-man arbitral tribunal
(Justice Sanyaolu (retired), Professor Fidelis Odita,
(SAN), Mr. Michael Kuper, who declined the appointment
and was replaced by Mr. Stephen Bates to resolve the
The arbitral tribunal heard the dispute. In the course of hearing the dispute the appellant and the 2nd, 4th, 6th, 7th 8th and 9th respondents raised preliminary objections challenging the jurisdiction of the arbitral tribunal to entertain the dispute on sundry grounds to the effect inter-alia that the arbitral tribunal was improperly constituted and that the proceedings before it amounted to an abuse of process as well as misconduct on the part of the arbitrators.
The arbitral tribunal took the
preliminary objections along with the substantive
At the end of the day, the arbitral tribunal overruled the preliminary objections and heard the dispute on the merit resulting in its partial award against the appellant and the other respondents. The arbitral tribunal, however, deferred decision on the 1st respondent's relief seeking an order that the appellant,6th respondent and the other respondents should pay all the costs, fees and expenses arising from the arbitral proceedings. The arbitral tribunal also deferred decision on the claim that all the respondents in the arbitration should pay to the 1st respondent interest at the rate of 10% per annum on all sums awarded by the arbitral tribunal to the 1st respondent who was the claimant before it.
Aggrieved, the appellant filed a notice of appeal with seven grounds of appeal. In a brief of argument filed on 14-1-13, the appellant raised the following issues for determination in the appeal –
"1. Whether the learned trial Judge was right when she held that the 1st respondent could re-apply to the Chief Judge of the Federal High Court for the constitution of the Arbitral Tribunal after the invocation of the court's jurisdiction under section 7(3)(c) of the Arbitration and Conciliation Act, 1990? (Ground 1).
2. Whether the learned trial Judge was right in failing to set aside the Partial Final Award on grounds that the Arbitral Tribunal decided the parties' rights under the Offer Letter Contract which was not the shareholders' contract upon which the arbitration was constituted? (Ground 2).
3. Whether the learned trial Judge was right in holding that the decision of the Arbitral Tribunal touching on the meaning and effect of the Offer Letter Contract which was the subject of a pending suit No.: LD/841/2006 filed by the same Claimant did not constitute an abuse of process? (Ground 3).
4. Whether the learned trial Judge was right in failing to decide issues relating to grounds 4, 5, 6 and 7 relied upon by the appellant for seeking a setting aside of the Partial Final Award? (Grounds 4, 5, 6 and 7)."
The appellant submitted under the first issue that in order to avoid absurd and uncertain results that would create an abuse of the process of the court, Section 7 of the Arbitration and Conciliation Act, Cap A18 Laws of the Federation of Nigeria, 2004, (ACA) representing the statutory mechanism for appointing arbitrators and the arbitration clause under Clause 25.1 of the Shareholders Agreement representing the contractual mechanism for appointing arbitrators should have been construed by the court below to the effect that both the said statutory and contractual mechanisms cannot be utilized by a party to obtain the appointment of an arbitrator on the premise that once one is utilized the other becomes spent for the purpose of the particular dispute.
It was, also, argued that in
light of the fact that the 1st respondent had by a
deposition under Section 7(3)(c) of the ACA informed the
High Court of the failure of the appointing authority
chosen by the disputants to appoint an arbitral tribunal
before she approached the High Court of Lagos State to
appoint an arbitral tribunal, it was not right for the
1st respondent to revert to the same appointing
authority she had stated on oath refused to make the
appointment to make the appointment.
It was argued on the second issue that the arbitral tribunal exceeded its mandate by deciding in page 1075 of the record the rights of the parties under the Offer Letter Contract which was a separate contract from the Shareholders Agreement and had no arbitration clause and was not pleaded as a relief in the statement of claim, therefore its determination by the arbitral tribunal amounted to a misconduct warranting the setting aside of the award vide Section 48(a)(iv) and (v) of the ACA read with the cases of Taylor Woodrow (Nig.) Ltd. v. S.E. GMBH (1993) 4 NWLR (Pt.286) 127 and U.B.N. Plc v. Ayodare and Sons (Nig.) Ltd. (2007) 13 N.W.L.R. (Pt.1052) 567 at 595 - 596; it was urged that the arbitral tribunal having found in paragraph 285 of the award in page 299 of the record that the Offer Letter Contract and the Shareholders Agreement were inextricably linked and inseparable the court below ought to have set aside the award.
Arguments on the third issue are to the effect that the Offer Letter Contract was the subject of a pending suit No. LD/841/2006 filed by the 1st respondent as claimant at the High Court of Lagos State with reliefs fundamentally the same as the arbitration which was an abuse of process and, also, amounted to waiver or estoppels of the 1st respondent's rights to arbitrate, therefore the court below was wrong to uphold the award in its reasoning in pages 1066 - 1067 of the record citing in support the cases of The Owners of the M.V. Lupex v. Nigerian Overseas Chartering and Shipping Ltd. (2003) 15 NWLR (Pt.844) 469, Harriman v. Harriman (1989) 5 NWLR (Pt.199) 6 at 16, Saraki v. Kotoye (1992) 4 NWLR (Pt.264) 156 at 188, Michael Wilson and Partners Ltd. v. Sinclair and Ors, (20121 EWHC 2560 (Comm), Agu v. Ikewibe (1991) 3 NWLR (Pt.180) (pagination not supplied), Arubo v. Aiyeleru (1993) 3 NWLR (Pt.280) 126 at 142 (on inherent powers of the court to prevent abuse of its process)
It was further argued that a stay of proceedings pending arbitration applied for by three of the defendants in suit No: LD/841/2006 was dismissed by the court below which "surprisingly" did not take judicial notice of its ruling in its file to hold that no stay of proceedings was applied by the defendants; and, that even if the defendants in that suit had not applied for a stay of proceedings pending arbitration, the court below was still in charge of the dispute as its subsequent decision on the dispute would settle the rights of the parties vide Obi-Obembe v. Wemabod Estate (1977) All NLR 130 at 141.
The appellant contended on the
fourth issue that she submitted four issues to the court
below for determination which it did not determine
contrary to established practice that all the issues
presented before the court for adjudication must be
pronounced upon by the court vide Oyelofu v.
Durosimi (2001) 16 NWLR 1 at 14, Yesufu v. Adegoke
(2007) 11 NWLR (Pt.1045) 1 at 29. The appellant
proceeded to itemize the said undecided issues as those
contained in grounds 4, 5, 6 and 7 of the originating
motion in pages 1 - 3 of the record to wit -
the arbitral tribunal misconducted itself by deciding
the rights of the parties based on Clause 27.7 of the
Shareholders Agreement in respect of escrow obligations
created by another contract, the Offer Letter Contract,
and inconsistently applied the said clause to find
liability on the part of the appellant without
corresponding liability on the part of the claimant in
the arbitral tribunal misconducted itself by making
inconsistent findings when it held that all the defects
in the Offer Letter Contract were waived by the claimant
on the one hand only to hold on the contrary that the
switch shares were sold in breach of clause 17 of the
(c) that the arbitral tribunal misconducted itself and committed an error of law on the face of the award in finding the appellant liable to damages on the basis of the Shareholders Agreement, Deed of Adherence of 26-5-2006 and equitable compensation when these causes of action were not pleaded by the 1st respondent, as claimant, in the arbitration;
that the arbitral tribunal misconducted itself by making
inconsistent finding and/or committed an error of law on
the face of the award when it held that the sale of
shares to the appellant could not be reversed and only
damages could be granted only to turn round to grant a
declaration that the transaction was null and void and
conferred no rights on the appellant.
The appellant urged that Section 15 of the Court of Appeal Act, 2004 be invoked and the four undecided issues (supra) be decided by the Court as all the materials necessary for their determination are in the record and would not require additional or further materials for their determination citing in support Section 48(iv) of the ACA and Taylor Woodrow Nig. Ltd. v. S.E. GMBH (supra) for the resolution of the undecided issues (a) to (d) (supra) and for the setting aside of the award made by the arbitral tribunal in paragraphs 294 - 332 of the award with emphasis on paragraphs 294, 299, 308, 328 and 347 in pages 301-308 of the record on ground of misconduct, as the arbitral tribunal had found that neither the Offer Letter Contract nor Clause 17 of the Shareholders Agreement created an obligation for the Selling Shareholders to provide Amended Transaction documents and workable escrow arrangement for 1st respondent. It was, therefore, urged that there was no reason to find obligation against the Selling Shareholders and the appellant on the basis of Clause 27.7, as it amounted to a misconduct for the arbitral tribunal to rely on the general provision in Clause 27.7 to the detriment of the specific provision or obligations under clause 17 and its inconsistent finding that Clause 27.7 refers to all Shareholders, depending on the circumstances of the case, when the obligation under Clause 27.7 applies to all Shareholders without qualification, upon which an obligation was placed on the 1st respondent to point out the omission of First Bank Plc signature provision to save the transaction by affording the opportunity to the Selling Shareholder to have it remedied, therefore it was wrong to find liability on the basis of that clause on the part of one party only.
The appellant's brief further advocated that the finding of waiver of the breaches of Clause 17.2 of the Shareholders Agreement by the 1st respondent and the finding on the other hand that the sale of the switch shares through the Offer Letter Contract was a breach of the Shareholders Agreement in pages 314- 318 of the record amounted to a misconduct by the arbitral tribunal; that no relief was claimed against the appellant in the arbitration, therefore the arbitral tribunal had no jurisdiction to determine as it did in paragraphs 382, 383, 384 and 386 of the award in pages 320 - 321 of the record that the appellant breached Clause 27.7 of the Shareholders Agreement or Deed of Adherence which entitled the 1st respondent to more than nominal damages" thereby imposing liability on the appellant even in the absence of any relief pleaded against it contrary to section 19(1) of the ACA and the case of T.E.S.T. Inc. v. Chevron (Nig.) Ltd. (2011) 8 NWLR (Pt.1250) 464; and that by awarding the 1st respondent both of two alternative reliefs or remedies of voiding the share transaction and damages subject to proof at a future hearing the arbitral tribunal committed a misconduct or an error of law on the face of the award contrary to the cases of Taylor Woodrow (Nig.) Ltd. v. S.E. GMBH (supra) at page 12,Tang Man Sit v. Capacious Investment Ltd. (1996) AC 518 at 521 - 522, Afrotec Tech. Service (Nig.) Ltd. v. MIA and Sons Ltd. (2000) 15 NWLR (Pt.692) 730 at 790, Iyang v. Ebong (2002) NWLR (Pt.751) 284 at 339; upon which the appellant urged for the appeal to be allowed and the undecided four issues in question be decided by the Court under Section 15 of the Court of Appeal Act.
The 1st respondent filed her brief of argument on 20-2-13, in which these issues were distilled for determination –
"1. Whether the lower court was correct in deciding not to set aside the Tribunal's Award on the basis of the matters which are now argued by the Appellant as Issues 1 - 3 in the Appeal. (Ground 1, 2 and 3 in the Notice of Appeal).
2. Whether, as is now raised as Issue 4 in the Appeal, the lower court decided Grounds 4 - 7 as argued by the Appellant before the Lower Court. (Grounds 4, 5, 6 and 7 in the Notice of Appeal).
3. If issue (2) above is answered in the negative, whether this Honourable Court should apply the provisions of Section 15 of the Court of Appeal Act Cap 36 Laws of Federation of Nigeria 2004 (the Court of Appeal Act), and if so, whether the decision of the Tribunal ought to be confirmed or set aside."
The 1st respondent prefaced its brief with the remarks that in determining whether or not to set aside an arbitral award the court of first instance concerns itself with whether the award was good on its face or justified, not whether upon the law and facts the award was objectionable, as there is no right of appeal to the court below over arbitral awards as to give the court below the power to come to a different conclusion from the arbitral tribunal for, the purpose of setting aside the arbitral award vide Unic v. Karima (1969) NCLR 247 at 253, Law and Practice of Arbitration and Conciliation in Nigeria by Orojo and Ajomo page 275, Mutual Life and General Insurance Ltd. v. Kodi Iheme (CA/L/461/2006, unreported, dated 18-1-13 at 24); yet the appellant has enlarged the appeal process by referring to the decision of the arbitral tribunal as if it was the decision of the court below in disregard of the correct approach which is whether the court below was right not to set aside the arbitral award; therefore the appellant should not be allowed to use the present appeal as an avenue to re-litigate for the third time what she had unsuccessfully canvassed at the arbitral tribunal and the court below on issues that she had agreed by Clause 25 of the Shareholders Agreement should be finally settled by arbitration vide Law and Practice of Arbitration and Conciliation in Nigeria (supra) at pages 274 -275.
It was further prefaced in the 1st respondent's brief that the grounds for intervening in an arbitral award for the purpose of setting it aside must be as provided by the ACA and UNCITRAL Model Law on International Commercial Arbitration 1985 (the Model Law), especially Section 34 of the ACA replicated with Article 5 of the Model Law and emphasized by Law and Practice of Arbitration and Conciliation in Nigeria 1999, page 269, to the effect that where the ACA does not provide for the intervention of the court, there should be no intervention with the arbitral award; that the court below correctly approached the issue when it stated that the grounds for setting aside an arbitral award are as contained in Sections 30 and 48 of the ACA.
The 1st respondent relied on its earlier submissions to the court below in respect of the issue of alleged excess of jurisdiction in addition to the submissions contained in its brief on the issue and; as to the allegation of inconsistency or ambiguity of the award, the 1st respondent also relied on the submission to the court below in paragraphs 40-46 of the 1st respondent's response in page 1 of the supplementary record and pages 775 - 776 of the main record in addition to the submissions made in the brief on the issue.
The 1st respondent cautioned in its brief that it is only if the operative or decisive part of an award as opposed to the part setting out the reasons for the award that the inconsistency or ambiguity ground for setting aside an arbitral award would apply vide Moran v. Lloyd's (1983) QB 542 at 550 where it was held that the passage in Halsbury's Law of England 4th Edition, Volume 2, paragraph 622 is incorrect, as the case of Ames v. Milward (1818) 8 Taunt, 637 had been misinterpreted by the learned authors and that the said misinterpreted case and the passage in Halsbury's Laws of England were what the Supreme Court relied upon in its judgment in Taylor Woodrow of Nigeria v. Suddeutsche Etna-Werk GMBH (1993) 4 NWLR (Pt.286) 127 at 141 -143.
The 1st respondent also cautioned that the inconsistency or ambiguity of the award ground has to be read in a reasonable and commercial sense so as to strive to uphold the award vide Zermalt Holdings SA v. Nu-Life Upholstery Repairs Ltd. (1985) 2 EGLR 14, Born's International Commercial Arbitration Vol.II, 3rd Edition (2009) 2656.
The 1st respondent's brief further stated that the power to set aside an award for error of law on the face of the award is not lightly exercised, because the court before whom an arbitral award is challenged cannot assume appellate jurisdiction over the award of the arbitral tribunal, and that three conditions must co-exist before an arbitral award may be set aside to wit -the alleged error must be on a point of law which was incidental to the matter before the arbitral tribunal, not on a point of law specifically referred to the arbitral tribunal for its determination; that the court looks only on the face of the award and any document actually incorporated within the award, not the pleadings or even the underlying contract, in determining the ground of error of law; and that the error must be material to the arbitrator's conclusion citing in support of the said submissions the cases of Taylor Woodrow of Nigeria Ltd. (supra) at 144 - 145, Baker Marina Nigeria Ltd; v. Danos and Curole Marina Contractors (2001) 7 NWLR (Pt.712) 337 at 351 - 352 and Law and Practice of Arbitration and Conciliation in Nigeria (supra) 282. The 1st respondent then indicated its reliance on the submissions to the court below for grounds 1 - 3 of the appellant's set aside submissions as additional arguments in the appeal.
The 1st respondent adopted its
arguments in paragraphs 71 - 76 of the 1st respondent's
response to the appellant's set aside application at the
court below as part of the arguments in the appeal and
added that the appellant's complaint related to the
process of constituting the arbitral tribunal, not about
compliance with the agreement between the parties which
Section 48(a)(vi) of the ACA is concerned; that the act
of constituting the arbitral tribunal was contractual,
not judicial, which was, also, to enable rather than
frustrate the arbitration process under Section 7(3) of
the ACA and had nothing to do with waiver by the 1st
respondent of the appointment procedure under Clause 25
of the Shareholders Agreement; and that, upon the
appointment made by one of the appointer's under Clause
25 of the Shareholders Agreement, the other appointer's
power to appoint under Section 7(3) of the ACA becomes
defunct such that the first in time to appoint would be
the one that made a valid appointment; therefore, the
renewal of the application for appointment made to the
Chief Judge of the Federal High Court was not an abuse
of process, notwithstanding the first request for
appointment was not terminated before the said renewal;
and given that the purport of Section 7 of the ACA is to
ensure that parties' agreement to arbitrate is upheld,
wherever possible; therefore the said constitution of
the arbitral tribunal by the CJ of the Federal High
Court achieved the said objectives and should not be
The 1st respondent also argued
that the alternative basis for the finding by the
arbitral tribunal that there was a breach of Clauses
17.1 and 17.2.2 of the Shareholders Agreement by
reference to the requirements of Clause 27.7 of the
Shareholders Agreement in the transfer of shares was
within the jurisdiction of the arbitral tribunal and the
said award should not be disturbed; all the more so
Clause 27.6 of the Shareholders Agreement and the Offer
Letter Contract are not inextricably linked as
previously argued under paragraph 82 of the 1st
respondent's response in pages 785 -786 of the record;
and that as to the appellant's assertion that the 1st
respondent did not plead breaches of the Offer Letter
Contract as a basis for relief, as set out more fully in
paragraphs 84 - 86 of the 1st respondent's response, is
an "unmeritorious pleading point" which the arbitral
tribunal rightly rejected, therefore issue 2 should be
resolved in favour of the 1st respondent.
The 1st respondent further contended that, even if there was an abuse of process; the remedy was to stay proceedings in the suit and proceed with the arbitration; that the principle of abuse of process does not apply to arbitral proceedings as argued in paragraph 91 of the 1st respondent's response in pages 788 - 790 of the record, as arbitral bodies are creatures of the parties' agreement and do not have inherent power or authority beyond that which is conferred on them by the parties; that public policy would only constitute a ground for setting aside an award in extreme cases, which is not the case here vide Profilati Italia Srl v. Painewebber Inc. (2001) 1 All ER (Comm) 1065 at paragraph 17; and that the application for a stay of proceedings was not made in favour of the arbitration in issue and is therefore irrelevant.
The 1st respondent further argued on the third issue that none of the conditions stipulated by Sections 30 and 48 of the ACA for the setting aside of arbitral award was met by the appellant; that estoppels or waiver were held by the arbitral panel to be inapplicable, so the arbitral proceedings and the said findings in paragraphs 125 - 126 and 130 - 132 of the award in pages 262 - 264 of the record are fatal to the appellant's claim of waiver/estoppels.
Consequently, it was urged by the 1st respondent that the fact that the same or similar factual issues underpin multiple claims would not prevent a party from commencing more than one action based on different causes of action, therefore there was no abuse of process and/or waiver/estoppels by the commencement of the action in suit 841 and the concurrent existence of the arbitration proceedings, so the issue should be resolved for the 1st respondent.
The 1st respondent 'referred to pages 1077 -1078 of the record to contend that the court below considered grounds 4 - 7 argued by the appellant before it in its judgment vide paragraphs 60 and 61 thereof with emphasis on page 1077 of the record where the court below decided the central issue whether or not to set aside the award either based on misconduct or error of law which subsumed the other issues and did not oblige the court below to determine the case as arranged by the appellant in the set aside application and that the said 'judicious and judicial determination did not occasion a miscarriage of justice vide Dalori v. Sadikwu (1998) 12 NWLR (Pt. 576) 112 at 121, Atoyebi v. Bello (1997) 11 NWLR (Pt. 528) 268 at 286, Ishola v. Folorunso (2010) 13 NWLR (Pt.1210) 169 at 211.
It was also argued by the 1st respondent that in the event the Court holds that Grounds 4 - 7 of the set aside application were not considered by the court below, the 1st respondent concedes that the said Grounds 4 - 7 can be determined by the Court under Section 15 of the Court of Appeal Act, in which in-case the 1st respondent contends that clause 27.7 of the Shareholders Agreement was submitted by the parties to the arbitral tribunal for arbitration of all disputes "arising out of or in relation to the interpretation of the Shareholders Agreement" which the arbitral tribunal determined, therefore the disagreement of the appellant with the award made by the arbitral tribunal does not amount to a misconduct by the arbitral tribunal vide Taylor Woodrow Nigeria Ltd. (supra).
The 1st respondent further argued that the arbitral tribunal merely interpreted Clause 17.22 of the Shareholders Agreement in the course of which it referred to issues of performance or otherwise of the Offer Letter contract relevant to compliance by the parties with Clause 17.2.2. of the Shareholders Agreement; 'that even if there was inconsistency in the process of reasoning by the arbitral tribunal regarding its interpretation of Clause 27.7, which the 1st respondent does not concede, it is not a ground to set aside the award; that the appellant's Ground 5 is an unacceptable invitation to the Court to substitute its own views for the arbitral tribunal's findings of fact and its interpretation of Clause 17 of the Shareholders Agreement in paragraph 365 of the award in page 316 of the record and should not be accepted by the court.
It was further argued that the
court cannot look at the pleadings and applications made
in the arbitration to determine whether there was a
properly pleaded cause of action against the appellant
as a ground for setting aside the award adequately dealt
with by the arbitral tribunal in paragraphs 381 - 383 of
the award in pages 319 - 320 of the record, as the
pleading point is not one of the grounds in Section 48
of the ACA for the setting aside of an arbitral award;
that after declaring the Selling Shareholders
Transaction null and void pursuant to the arbitral
tribunal's interpretation of Clause 17.1 of the
Shareholders Agreement, the arbitral tribunal did not
make an order transferring any of the shares to the 1st
respondent and, that being the case, the arbitral
tribunal found that the 1st respondent was entitled to
damages and/or equitable compensation as a result of
breaches of the Shareholders Agreement which was right,
as a breach of contract entitles a party to damages in
his favour, albeit an award of more than nominal damages
requires proof of loss vide McGregor On Damages, 18th
edition, 2009, paragraph 10 - 003.
"3. The 2nd and 4th Respondents align themselves with the Appellant and adopt the arguments of the Appellant on all the issues formulated for the determination of this Honourable Court as contained in the Appellant's Brief of Arguments".
The 2nd - 4th respondents'
brief followed-up under the column for conclusion that -
"4. We humbly submit that the Appellant's appeal be allowed for the reasons canvassed by the Appellant in its brief of Arguments dated and filed 14th January, 2013."
The 2nd - 4th respondents'
brief ended on the note stated above.
The 6th respondent's brief
filed on 18-3-13 formulated the following single issue
for determination -
"Whether the Learned Trial Judge was right in refusing to set aside the award on the ground that the Tribunal misconducted themselves in assuming jurisdiction to entertain the matter".
The 6th respondent adopted
issues 2, 3 and 4 of the appellant's issues for
determination in addition to the single issue formulated
The 6th respondent contended
on the first issue that the arbitral tribunal was
required to be constituted under Section 7(3)(c) of the
Arbitration and Conciliation Act Cap A.18 Laws of the
Federation of Nigeria (LFN) 2004 (ACA), which the
arbitration Clause of 25(2) of the Shareholders
Agreement incorporated by its reference to Nigeria as
the place for the settlement of dispute that may arise
thereunder; that the designated authority, the Chief
Judge of the Federal High Court, declined to exercise
the power to appoint the arbitral tribunal under Clause
25 of the Shareholders Agreement and directed the
parties to apply to the court for the appointment of the
arbitrators and the 1st respondent so applied by
invoking the jurisdiction of the High Court to appoint
the arbitrators; and, that it was thereafter that the
1st respondent successfully re-applied to the Chief
Judge of the Federal High Court who made the appointment
when there was no provision for re-application either in
the Shareholders Agreement or in Section 7(3)(c).
Consequently, it was urged that the appointment of the arbitrators by the Chief Judge of the Federal High Court in the circumstance was wrong and amounted to forum shopping which is an abuse of process and, also, it amounted to improper composition of the arbitral tribunal which struck at the jurisdiction of the arbitral tribunal to arbitrate the dispute and affords sufficient jurisdictional ground to set aside the award following the cases of Madukolu and Ors. V. Nkemdilim (1962) 2 NSCC 374, R-Benkay Nig. Ltd. V. Cadbury Nig. Plc (2012) 3 MJSC 185 at 211 - 212, Onyeabuchi V._ Independent National Electoral Commission 4 S.C. (Pt.2) 27, Usman V. Baba (2005) 5 NWLR (Pt.917) 113 at 132 and section 48(vi) of the ACA.
The 6th respondent also
contended that the issue of abuse of process goes to the
jurisdiction of the court and, that, where it is
established, the case merits dismissal. And it was on
that note that the 6th respondent rounded its argument
in these words:-
"Finally, the 6th Respondent aligns itself with the Appellant and adopts the arguments canvassed by the Appellant under its issue No. 1 of the Appellant's Brief of Argument as its own argument in this appeal. We urge this Honourable Court to allow the appeal."
So ended the 6th respondent's brief.
The 7th and 9th respondents'
brief which was filed on 22-2-13, adopted the
appellant's issues for determination followed with these
arguments and conclusion.
7th and 9th Respondents hereby adopt in their entirety
the arguments proffered by the Appellant on the issues
for Determination in the Appellant's Brief of Argument,
complete with all the authorities cited therein, as
their own arguments in this appeal.
"We urge Your Lordships to allow this Appeal considering the arguments contained in the Appellant's Brief of Argument and the prayers contained in the Notice of Appeal dated 30 October 2012."
So concluded the 7th and 9th respondents' brief.
The 8th respondent's brief dated and filed on 15-2-13 adopted the issues formulated by the appellant as well as the appellant's arguments on the issues and concluded as follows:-
"The 8th Respondent urges this
Honourable Court to set aside the decision of the lower
court and in its place substitute an order setting aside
the Partial Final Award on the grounds that the Arbitral
Tribunal was improperly constituted, the Arbitral
Tribunal exceeded its powers by deciding on the Offer
Letter contract and other grounds highlighted in the
It was on that coda that the 8th respondent ended its brief.
The 21st respondent's brief dated and filed on 4.4.13, but deemed properly filed on 8.4.13, submitted one issue for determination thus –
"Whether the lower court was
correct in refusing to set aside the Partial Final Award
on the grounds argued by the Appellant in the Court
The 21st respondent argued that parties choose their arbitrator(s) and once an award is made that is on the face of it good the courts are slow to intervene with the award citing in support the cases of Aye-Fenus Enterprises Ltd. V. Saipen Nig. Ltd. (2009) 2 NWLR (Pt. 1126) 483 at 513 and 518 - 519, Arbico Nigeria Limited V. Nigeria Machine Tools Ltd. (2002) 15 NWLR (Pt. 789) 1 at 24.
The 21st respondent's brief
argued further that the power of the Chief Judge of the
Federal High Court to appoint arbitrators under Clause
25 of the Shareholders Agreement is ministerial, not
judicial or quasi-judicial, therefore the issue of
functus officio does not arise as it is a default
provision intended to assist parties to an arbitration
agreement constitute arbitral tribunal, therefore the
appellant's argument that once Section 7(3)(c) of the
ACA is triggered, there is no turning back even where
circumstances have changed and the appointing authority
is willing and able to act is untenable; that, as the
1st respondent did not intentionally and voluntarily
surrender or relinquish the right provided by Clause 25
of the Shareholders Agreement to invoke Section 7(3)(c)
of the ACA, the doctrine of waiver could not have caught
up with it vide Fasade and Ors. v.
Babalola and Anor. (2003) 11 NWLR (Pt.830) 26 at 47,
on the meaning of waiver.
The 21st respondent's brief
cautioned that the lower court and indeed the Court does
not sit on appeal over an award made by arbitrators to
ascertain whether the findings and conclusions of the
arbitrators were wrong in law, but that the court places
itself in the position of the arbitrator(s) to determine
whether the arbitrator(s) followed the law as they
understood and expressed it; and that, the award did not
create substantial miscarriage of justice vide Baker
Marine v. Chevron (2000) 12 NWLR (Pt.681) 393 at 410,
Araka v. Ezeagwu (2000) 15 NWLR (Pt.692) 684 at 719 -
720, Arbico (supra) at 24 - 25;
The reply brief also contended
that the arguments submitted by the 1st respondent to
the court below on the appropriate test to follow in
deciding the application to set aside the arbitral award
were not made an issue in the notice of appeal filed
against the decision of the court below, because the
court below did not pronounce on them and are, on that
account, irrelevant, particularly grounds 1, 2, and 3 of
the notice of appeal which though labeled as misconduct
are in fact jurisdictional points.
The reply brief went on to
argue that the respondents by their actions failed to
observe the right of preemption under Clause 17 of the
Shareholders Agreement and the failure to plead the
cause of action sufficed to have the award on that issue
set aside on ground of error in law; that the comments
of the court below on suit 841 formed part of its
conclusion on the 3rd issue for determination in page
1062 of the record and cannot be said to be obiter; that
the obligation which the arbitral tribunal found
breached clause 27. 7 of the shareholders Agreement was
the obligation to provide amended transaction documents
which is contained in the Offer Letter Contract and
cannot be severed; that the categories of abuse of
process which is against public policy are not closed
vide Revenue Mobilization Etc (supra), Saraki
v. Kotoye (supra), that the remedy of a stay of
proceedings pending arbitration was inapplicable in the
case, because the plaintiff in the court action elected
to commence arbitration on the same subject; that
Section 4(2) of the ACA contemplates that the defendant
in the court proceedings should be the claimant in the
arbitration vide The Owners of the M.V. Lupex v.
Nigerian Overseas Chartering and Shipping Ltd. (2003)
15 NWLR (Pt. 844) 469 at 487 and The Nigeria
Arbitration Law by Justica Ephraim Akpata; that by
instituting suit 841 the 1st respondent reprobated the
Shareholders Agreement and by commencing the arbitration
the 1st respondent approbated the same Shareholders
Agreement contrary to the intention of Sections 4 and 5
of the ACA.
The reply brief added that
grounds 4 - 7 were submitted as specific issues to the
court below which it did not consider specifically in
the sense of referring to the arguments on them and
making a decision thereon;, nor did the court below
subsume their consideration under any of the other
issues considered by it and; that, as the issues
affected the wrongful application of Clause 27.7 of the
Shareholders Agreement and improper pleading of cause of
action, obvious miscarriage of justice was occasioned by
the failure of the court below to consider them; upon
which the appellant pressed for the appeal to be
A Notice of Preliminary objection was filed by the 1st respondent against 2nd and 4th, 6th, 8th, 7th - 9th respondents' respective briefs of arguments. Paragraphs 4 - 7 of the affidavit in support of the preliminary objection deposed that the said respondents having not cross-appealed or filed notice of intention to vary the judgment on other grounds and/or having not appealed cannot file briefs supporting the appellant's brief.
The 1st respondent's
supplementary written address for the preliminary
objection which was adopted at the hearing of the appeal
relied on the cases of Minister of Petroleum and
Mineral Resources and Anor v. Expo Shipping Line
(Nig.) Ltd. (2010) 12 NWLR (Pt. 1208) 261 at 283,
Imoniya Holdings and Anor. v. Soneb Enterprises Ltd.
(2010) 4 NWLR (Pt.1185) 561 at 579, Kotoye v. C.B.N.
(1989) 1 NWLR (Pt. 98) 419 and Order 18 rule 4(2)
of the Court of Appeal Rules, 2011, to urge that the 2nd
and 4th, 6th, 8th, 7th and 9th respondents having not
cross-appeared or having not filed a Respondent's Notice
to vary the judgment cannot file briefs praying for the
appeal to be 'upheld'; and that the traditional and
natural role of a respondent being to support the
judgment appealed against, the respective briefs of the
2nd and 4th, 6th, 8th, 7th and 9th respondents which
argued against the judgment of the court below and urged
that the appeal be allowed are incompetent and should be
The 2nd and 4th respondents' counter affidavit attached a copy of their notice of appeal against the judgment of the court below (Exhibit 00-1) in which they are appellants, while the present appellant together with the other respondents are the respondents in the said appeal. The 2nd and 4th respondents' supplementary address filed on 24.4.13 against the preliminary objection was, also, adopted at the hearing of the appeal where it was argued that the 2nd and 4th respondents do not seek to correct errors in the judgment of the court below; nor do the 2nd and 4th respondents agree with the judgment of the court below, or want it varied or affirmed on other grounds, therefore it is absurd to expect the 2nd and 4th respondents to file a cross-appeal or a notice to vary the judgment on other grounds vide Emeka v. Okadigbo (2012) 18 NWLR (1331) 55 at 97, NNPC v. Klifco (Nig.) Ltd. (1255) (?) 10 NWLR (Pt. 1255) 209, Anyaduba v. NRTC Ltd. (1990) 1 NWLR (Pt. 127) 397; and that the 2nd and 4th respondents having appealed against the judgment of the court below in their notice of appeal in Exhibit 00-1 have a parallel appeal and are entitled to file a brief disagreeing with the judgment of the court below therefore their joint brief is competent and should not be struck out vide Imoniya Holdings Ltd. v. Soneb Enterprises Ltd. (2010) 4 NWLR (Pt. 1185) 561, Youngbush v. Bulus (1997) 2 NWLR (Pt. 489) 621 at 630 Ozigbo v. P.D.P. (2010) 9 NWLR (Pt. 1200) 601.
It was further argued that the
present appeal and the appeal in Exhibit 00-1 are
similar, so, if the 2nd and 4th respondents' brief is
struck out and the present appeal is later dismissed the
dismissal would affect the appeal in Exhibit 00-1
without affording the 2nd and 4th respondents the
opportunity to be heard on it.
The 6th respondent also filed counter affidavit in opposition to the preliminary objection in which it attached a notice of appeal, Exhibit KA1, showing it appealed against the judgment of the court below and made the appellant and the other respondents in the said appeal. The 6th respondent caused a written address to be filed on 13-5-13, which it adopted at the hearing of the appeal, and in which it was contended that having appealed against the judgment of the court below, the 6th respondent is entitled to file a brief in the present appeal challenging the judgment of the court below vide Adenuga v. Odumeru (2000) NWLR (Pt.821) 163 at 181, Youngbush v. Bulus (1997) 2 NWLR (Pt.489) 621 at 630; and that the 6th respondent's brief attacks the jurisdiction of the arbitral tribunal which can be raised at any time and by any means vide Olutola v. Unilorin (2004) 15 NWLR (Pt.905) 516 at 495, Western Steel Works Ltd. v. Iron and Steel Workers Union (1986) 3 NWLR (Pt.30) 617 at 627 - 628, JCL Ltd. v. Ezenwa (1996) 4 NWLR (Pt.443) 391; therefore the preliminary objection should be overruled and the 6th respondent's brief be used in the appeal.
The 7th and 9th respondents, like the 2nd and 4th respondents and the 6th respondent, filed counter affidavit against the preliminary objection and attached a notice of appeal to it as Exhibit PUC1 showing they appealed against the decision of the court below and made the appellant and the other respondents co-respondents in the appeal. The 7th and 9th respondents filed a written address against the preliminary objection, which they adopted at the hearing of the appeal, and in which they observed that a preliminary objection may be filed against an appeal, but not against a brief, the preliminary objection attacking their brief should not be countenanced.
The 1st respondent filed a
reply address to the 6th respondent's supplementary
address in opposition to the notice of preliminary
objection in which it was contended that, unlike the 2nd
and 4th respondents, the 8th respondent and the 7th and
9th respondents, the 6th respondent who was, also, a
party to the arbitral proceedings did not file an
application at the court below for the setting aside of
the partial award made by the arbitrators under Section
48 of the ACA, therefore the 6th respondent has no right
to appeal and the notice appeal filed by it ought to be
struck out vide the case of Akere and Ors. v. The
Governor of Oyo State and Ors. (2013) 2 WRN 1 at 53-54,
upon which the 1st respondent urged that the arguments
raised by the 6th respondent to justify the filing of
its brief are untenable, incompetent and should not be
The 7th and 9th respondents
had stated that a preliminary objection can only be
filed against an appeal, not a brief of argument. No
authority was cited for the proposition. In my modest
opinion, an objection can be based on law or facts on
both, as the case may be, as was settled by the Supreme
Court in the case of P.P.A. v. INEC (2012) 13 NWLR
(Pt.1317) 215 at 235. So, the argument that an
objection cannot be taken against a brief of argument
is, with respect, of no moment'
The 1st respondent's reply to the 6th respondents' written address argued that the 6th respondent had no right of appeal, so the notice of appeal filed by it is of no value. I believe this is a matter to be taken against the appeal itself. For now, on the face of Exhibit KA1, the notice of appeal, the 6th respondent has an appeal against the decision of the court below.
The preliminary objection has to do with the 2nd and 4th, 6th and 7th-9th respondents' respective briefs earlier summarized in the judgment. Indeed the briefs in question disagree with the judgment of the court below. Order 18 rule 4(2) of the Rules of the Court provides in respect of what a respondent's brief may contain as follows –
"(2) The respondent's brief shall answer all material points of substance contained in the appellant's brief and contain all points raised therein which the respondent wishes to concede as well as reasons why the appeal ought to be dismissed. It shall mutatis Mutandis, also conform to Rule 3(1), (2), (3), (4) and (5) of this Order".
The word "concede" mentioned
in Order 18 rule 4(2) of the Rules of the Court means to
admit that something is true, logical or correct (see
Oxford Advanced Learners Dictionary, 7th Edition page
299). Therefore, by Order 18 rule 4(2) of the Rules of
the Court (supra), a respondent's brief may admit the
truth or correctness of the appellant's brief of
argument, but the brief must still urge that the appear
be dismissed if Order 18 rule 4(2) of the Rules of the
Court is to be complied with.
"The traditional role of learned counsel for the respondent, in contradistinction to that of learned counsel for the appellant, is to support the judgment appealed against. Where, however, learned counsel for the respondent cannot, in good conscience support the judgment appealed against, he should make his position known to his client with a view to either conceding the issues raised by the appellant or withdrawing from the appeal if his client persists in his pursuit of same". (My emphasis).
The case of Yongbush and Ors. v. Bulus
and Anor. (1997) 2 NWLR (Pt.489) 621 at 630 - 631
decides it (per the lead judgment of Edozie, J.C.A.,
concurred in by Oguntade and Muntaka-Coomassie
J.J.C.A.) that a respondent wishing to advance
arguments in the respondent's brief in support of the
reversal of the judgment appealed against must
cross-appeal against the said judgment first.
"The traditional role of a respondent in an appeal is to do everything to support the judgment. He is not supposed to attack the judgment except he has filed a cross-appeal". (My emphasis).
Further, in Ozigbo v.
P.D.P. (2010) 9 NWLR (Pt.1200) 601 at 634, it was
held by the Court (Abuja Division) per the lead judgment
of Abba Aji, J.C.A., (concurred in by R. D. Muhammad and
Lokolu-Sodipe, J.C.A.) that a respondent intending to
question the correctness of the judgment appealed
against must express his dissatisfaction with the said
judgment by filing an appeal against it.
And, based on these cases, the
2nd and 4th, 6th, 8th, 7th and 9th respondents who also
appealed separately against the decision of the court
below are entitled to use their respective respondents'
brief in the present appeal to align with the appellant
in arguing/urging for the decision of the court below to
be set aside or reversed.
In my respectful opinion, the
issues formulated by the appellant are adequate and apt
for the discussion and, I hereby, adopt the said issues
for the discussion.
It is common ground between the parties and I agree with them that the Shareholders Agreement made provision in Clause 25 thereof for arbitration, in the event of dispute, which, for convenience, I copy below –
"25.1. Any disputes, controversy or claim between the Parties arising out of or in relation to the interpretation or execution of this Agreement or the breach, termination or invalidity thereof shall be finally settled by arbitration in accordance with the UNCITRAL Arbitration Rules in effect as at the date of dispute. The number of arbitrators shall be three and they shall be appointed by the Chief Judge of the Federal High Court of Nigeria upon an application by any of the Parties. The Chief Judge shall specify which of the three arbitrators shall serve as the Chairman of the arbitral tribunal. The venue of arbitration shall be Nigeria and the language of arbitration shall be English.
25.2. The Parties agree that the award of the arbitrators shall be binding. No arbitrator shall be related to, be employed by or have any material business relationship with any of the Shareholders. This Clause shall not preclude the making of any application to a Court for injunctive relief or other order for the enforcement of such award of the arbitrators. The substantive and procedural law of the arbitration shall be Nigerian law, and in case of any conflict with any rule of international law, Nigerian law shall prevail". The venue of arbitration and the applicable law are stated in Clause 25.1 to be Nigerian thus bringing into force/application the Nigerian Law on Arbitration codified in the ACA bearing on the Shareholders Agreement. It is instructive that Section 7 of the ACA provides for the appointment of arbitrators by the High Court.
A dispute arose between the parties with respect to the Shareholders Agreement. The dispute was first taken by 1st respondent to the High Court in Suit. LD/841/2006 on 26.5.06. Then on 25.10.07, the 1st respondent issued a Notice of Arbitration of the dispute. Following Clause 25.1 of the Shareholders Agreement, the 1st respondent turned round to apply in writing to the Chief Judge of the Federal High Court (Ukeje, CJ.) to appoint arbitrators for the dispute. Ukeje, CJ, declined in writing to make the appointment, on 23.7.2907.
The 1st respondent then approached the High Court of Lagos State on 13.11.2007 under Section 7 of the ACA to appoint arbitrators for the dispute. Before the request under Section 7 of the ACA would be treated to finality by the High Court of Lagos State, the 1st respondent re-applied to the Chief Judge of the Federal High Court now Mustapha, CJ, Ukeje, CJ, having ceased to be a judicial officer. The new Chief Judge of the Federal High Court (Mustapha, CJ) acceded to the request and appointed three arbitrators to arbitrate the dispute. The three arbitrators accepted their appointment. One of them later declined and was replaced. Some of the respondents at the arbitration including the appellant objected to the mode of appointment of the arbitrators by Mustapha, CJ. The arbitrators heard the objection, which they dismissed. The arbitral proceedings then proceeded to finality. All these facts are not disputed by the parties.
The 1st respondent and the other respondents in opposing the appeal, however, contend on the other hand that the contractual arbitral provision in Clause 25 of the Shareholders Agreement is ministerial, not judicial or quasi-judicial, does not have an air of finality, as the issue can be re-opened and a new appointment made even after the predecessor-in-office of the person making the new appointment had declined to make the appointment.
Arbitration centers on the
agreement of the parties thereto. By the agreement the
parties choose their arbitrators. The choice of
arbitrators may be contained in an arbitration clause
such as Clause 25 of the Shareholders Agreement. As
pointed out by the Supreme Court (per the Judgment of
Udoma, J.S.C., (now of blessed memory) on behalf of the
Court) in the case of Royal Exchange Assurance v.
Bentworth Finance (Nig) Ltd. (1976) N.S.G.C, 648 at
"It occurs to us from what
has happened in this case on appeal that the true
nature of function of an arbitration clause in an
agreement does not appear sometime to be fully
appreciated. An arbitration clause in
a written contract is quite distinct from the other
clauses. Whereas the other clauses in a written
contract set out obligations which the parties
undertake towards each other, the arbitration clause
merely embodies the agreement of both parties that if
any dispute should occur with regard to the
obligations which the other party has undertaken to
the other, such dispute should be settled by a
tribunal of their own constitution and choice. The
appropriate remedy therefore for a breach of a
submission is not damages but its enforcement. Hence
the Arbitration Act (Cap. 13). So that where a party
refuses within a given time after due notice to have
an arbitrator appointed, the court has full power and
jurisdiction to appoint an arbitrator on an
application properly made by the party who has served
such notice. It is therefore unsound in
law for learned counsel for the appellants to submit
that a specific performance of a submission could not
be enforced by the court."
See, also Magbagbeola v. Sanni (2002) 4 NWLR (PT. 756) 193. So, by parity of reasoning parties to arbitration choose their arbitrators and where one of the parties dilly-dallies he may be compelled by specific performance to submit to arbitration as stated in Bentworth Finance (supra).
The Chief Judge of the Federal
High court (FHC) was, by the agreement of the parties in
Clause 25 of the Shareholders Agreement to appoint
arbitrators which appears to me to be an administrative
function conferred by the parties on the Chief Judge of
the Federal High Court by Clause 25 of the Shareholders
In performing an administrative, as distinct from a statutory function, a regimentation or stricture that may impede or hamstring the flexibility/leeway or latitude of the administrative authority to use its discretion in the loose and popular sense of the word would be unwise, in my modest view. See the case of Akinyemi v Odu'a Investment Co. Ltd. (2012) 17 NWLR (Pt. 1329) 209 at 240 where the loose and popular meaning of the word 'discretion', as distinct from judicial discretion was held per the lead judgment of Tanko Muhammad, J.S.C., to be thus –
"Discretion, they say "knows no bound".
In its general usage, it is that freedom or power to
decide what should be done in a particular situation.
William C. Burton, in his "Burton's Legal Thesaurus,
(2007) 4th edition, MC Graw Hill, New York, assigned
the general meaning of the word to include:
"analysis, appraisal, assessment, choice,
consideration, contemplation, decision, designation,
determination, discrimination, distinction, election,
free decision, free will, freedom of choice, liberty
of choosing, liberty of judgment, license, option,
optionality, permission, pick, power of choosing,
review, right of choice, sanction, selection, self
determination, suffrage etc." (My emphasis).
In matters of administrative
discretion, therefore, the person exercising the routine
administrative function has the luxury and laxity to
change his mind, like the weather, from negative to
positive depending on the vagaries of the occasion;
unlike statutory discretion which must be exercised
judicially and judiciously/rigidly.
Even in matters of appointment into public office the appointing authority that appoints or removes or suspends a person from work may change its mind to reinstate the person removed. See Section 11(1) of the Interpretation Act Cap. 123 contained in volume 8 or the Laws of the Federation 2004.
"Had a selection been made by
the State High Court pursuant to Section 7(3)(c) supra,
then it would no longer be open to the CJ of the FHC to
exercise the power in Clause 25(1) of the SHA. Until
such an occurrence, I hold, a selection can be made by
the Chief Judge of the Federal High Court who previously
refuses to act, or by a new Chief Judge of the Federal
I agree with the said holding. It is sound, in my humble view.
Abuse of process always involves some bias, malice, deliberateness, or the desire to misuse or pervert the course of justice by a party (or parties) at litigation against the opponent(s). See Amaefule v. State (1988) 2 NWLR (Pt. 75) 156 and Edet v. State (1988) 4 NWLR (1988) 4 NWLR (Pt. 91) 722. Abuse of process will only arise if multiple processes over the same issue are filed and sought to be pursued concurrently to the annoyance, harassment, or torment of the opponent(s), such that the opponent(s) is exposed to waste of time and resources as well as psychological pressure in trying to cope with the defence or response to the multiple processes brought by the other party (or parties) to achieve unwholesome or unlawful results.
The avowed aim of settling the
dispute by arbitration did not, therefore, have any
ulterior or unlawful motive. So it cannot be said it was
an abuse of process. At any rate, I venture to state
that where an abuse of process is detected by a party at
litigation the remedy appears to me to be for the said
party to apply to the regular court where the case that
is abused is pending to use its inherent powers to
restrain the arbitral proceedings on ground of abuse of
process, not to wait after the arbitral award is made
and seek to set aside the award on ground of abuse of
I respectfully add that even
if the filing of the two parallel cases was an abuse of
process, it was an irregularity that did not occasion a
miscarriage of justice. See by analogy Edet v. State
(supra) where it was held inter alia that it was
at best an irregularity not occasioning a miscarriage of
justice to commence proceedings in another court without
withdrawing the same proceedings pending in a different
Also, it is hard to understand
that parties who decide to put their fate in arbitrators
would turn round to accuse the arbitrators chosen by
them of abuse of process.
The approach by a court called upon to set aside an arbitral award and indeed an appellate court sitting on appeal over the decision of the court called upon to set aside an arbitral award is not the same as when both courts are handling cases coming from regular courts. An arbitral tribunal is by nature an informal adjudicatory body lacking the sophistication and technical know-how of Judges of regular courts. Arbitral tribunals are also not bogged down in the procedural trappings of regular courts. Arbitral proceedings are, therefore, treated with a broad, liberal/open mind leaning on the side of dynamism, commercial sense, latitude and common sense.
In other words, arbitral proceedings are not to be subjected to scrutiny with the finesse of a toothcomb. Suffice it to say that the object of examining proceedings of an arbitral tribunal is to ensure that at the end of the day the arbitrator(s) reached a practical, sensible, just and fair decision on the face of it, or that at first sight, not beyond or beneath the face of the award made by it.
"The underlying principle is that parties
to a dispute have a choice. They may resort to the
normal machinery for administration of justice by
going to the regular courts of the land and have their
disputes determined, both as to the fact and the law,
by the courts. Or, they may choose the arbitrator to
be the judge between them, if they take the latter
course, they cannot, when the award is good on the
face of it, object to the award on grounds of law or
facts. Smith, L.J., reiterated the
principle in Montgomery Jones and Co. v. Liebethat
(1898) 78 L.T. 406 where he stated at page 408:
'I for my part, have always understood the general rule to be that parties took their arbitrators for better or worse both as the decision of fact and decision on law'.
See further Taylor Woodrow Nigeria
Limited v. Suddeutsche Etna - Work GMBH (1993) 4 NWLR
(Pt. 286) 127 where the Supreme Court reiterated that
once the award is prima-facie good on the face of it,
none of the parties to the award can object to the
award either upon the law or the facts, simply because
the award is not in his favour. See also Arbico (Nig)
Ltd. v. N.M.T. Ltd. (2002) 15 NWLR (Pt.789) 1 at 31
-32. The grounds of law or of
facts alleged by the appellant (supra) were more or less
errors arising from the process of reasoning of the
By Section 48(a)(iv) and (v) of the ACA an arbitral award may be set aside if it dealt with a dispute not contemplated by the parties or not falling within the terms of the submission to arbitration; or that the award contains decisions on matters which are beyond the scope of the submission to arbitration.
What the arbitral tribunal found was that the Transaction Documents including a legally workable draft escrow agreement with the FBN breached the Offer Letter Contact which led to the inevitable breach of Shareholders Agreement, so that at the end of the day it was the Shareholders Agreement that was the rudder of the arbitral award, not the reasoning process followed by the Arbitral tribunal process followed to arrive at the award. The Offer Letter contract was therefore not part of the arbitral award. The court below was, accordingly, right to resist the invitation by the appellant to set aside the arbitral award. I too agree and affirm the said stance of the court below.
The contention by the
appellant on the alleged misconduct of the arbitrators
which centered on the determination of a clause in the
Offer Letter contract which was not submitted to the
arbitral tribunal and/or was not pleaded as a relief
appears to me to be met by the holding by the court
below in page 1075 of the record as follows -
"I note, however, that Econet's central claim is that the Offer Letter did not comply with Clause 17 of the SHA. I also note that it was in the construction of Clause 17 and 27.4 of the SHA that the Tribunal considered whether a contract resulting from service of a notice under the Offer Letter Contract had been performed, in order to decide if there was a breach of Clause 17.1 of the SHA.
I agree with the submission of the learned counsel to Econet that the Tribunal was primarily concerned with the interpretation of effect of the SHA and that issues of performance or otherwise of the Offer Letter Contract were merely relevant (if I may add incidental/collateral) to the Tribunal's decision regarding compliance with Clause 17.2.2 of the SHA."
I too agree.
I conclude that the clause in
the Offer Letter Contract which arose from the
performance terms of Clause 17.2.2. of the Shareholders
Agreement as it related to the Shareholders Agreement,
that the arbitral tribunal decided did not determine the
crux of the Offer Letter Contract itself, therefore the
arbitral tribunal did not exceed its mandate in deciding
and making the arbitral award, in my view.
From the summary of the
arbitral proceedings to the award contained in pages 330
- 334 of the record, the arbitral tribunal did not
incorporate its reasoning in the award, showing that on
the face of the award it was a good award as it was
based on the facts that arose from the dispute under
Clause 17 of the Shareholders Agreement.
A declaration was made in favour of the 1st respondent plus an award of damages. It has been argued that the two cannot go together. The argument relies on the principle against double compensation. A declaration or a declaratory award or declaratory judgment establishes the rights and other legal relations of the parties without providing for or ordering enforcement (see Black's Law Dictionary (Eighth Edition) 859). A case in point is the Supreme Court case of Iragbiji v. Oyewinle (2013) 13 NWLR (Pt.1372) 566 at 580 where Rhodes-Vivour, J.S.C. held in the lead judgment that –
"A declaratory judgment or order is one that proclaims or declares the existence of a legal relationship, but does not contain any order which may be enforced against the defendant. Once rights declared in a declaratory judgment are infringed, fresh proceedings are needed for enforcement. Declaratory judgments, cannot be enforced by execution as there is nothing to enforce." (My emphasis).
The arbitral tribunal made an
award declaring that the share transfers in favour of
Celtel (appellant) were null and void and that Celtel
was not validly registered as shareholder, as well an
award of equitable compensatory damages for breach of
Clause 27.7 of the Shareholders Agreement and an aspect
of the Offer Letter Contract. A declaration is a relief.
Damages are also a specie of relief. But it has not been
said that declaration and damages cannot be awarded
together where they are due. In regular courts such an
award is usual and is never taken as double compensation
where both reliefs are claimed and proved. It is only
when the same specie of relief is repeated in an award
like awarding general and special damages over the same
established wrong that double compensation would be the
In conclusion, I find no convincing basis to disturb the decision of the court below upholding the arbitral award which is good on its face. The appeal, though vigorously argued by the appellant, and vigorously resisted by the 1st respondent, has no merit.
On the whole, I see no substance in the appeal and hereby dismiss it and affirm the decision of the court below (Adefope-Okogie, J.) upholding the arbitral award in question. Parties to bear their costs.
I have had the privilege of reading in draft the Judgment just delivered by my learned brother JOSEPH SHAGBAOR IKYEGH, JCA.
I agree with the reasoning and conclusion reached therein and have nothing extra to add.
On the whole, I too see no substance in the appeal and hereby dismiss it and affirm the decision of the court below (Adefope-Okogie, J.) upholding the arbitral award in question. Parties to bear their costs.
TIJJANI ABUBAKAR, J.C.A.:
My learned brother IKYEGH JCA, granted me the privilege to read before now the lead judgment just rendered by him, I am in agreement with his reasoning and conclusion which I adopt as mine. He adequately covered the field, I have nothing to add.
I join my brother in
dismissing the appeal and affirming the decision of the
court below delivered by Adefope Okojie J parties shall
bear their costs.
MARY UKAEGO PETER-ODILI, J.S.C. (Delivering the Leading Judgment):
Plaintiff/Respondent instituted this action against the
Defendant/Appellant which was placed on the undefended
list. The defendant/appellant filed an affidavit and
Notice of Intention to defend the suit. At the end of
the hearing based on the affidavit evidence of the
parties, the learned trial judge entered judgment for
the plaintiff/respondent in the sum of N7,400,595.53k
(Seven Million, Four Hundred Thousand, Five Hundred and
Ninety-Five Naira, Fifty-Three Kobo) less N1,000,000.00
(One Million Naira) paid by the defendant on 13/9/2002
during the pendency of this suit with interest at the
rate of 5% per annum from the date of judgment until the
total payment of the judgment debt.
once more the Appellant has appealed to the Supreme
granted the defendant an overdraft facility in his
personal account NO. 2320 from the 4th day of September,
2000, up to the 13th day of August, 2001 by allowing the
defendant to overdraw his account to the tune of Seven
Million, Four Hundred Thousand, Five Hundred and Ninety
- Five Naira, Fifty-Three Kobo (N7,400,595.53) with
interest and the defendant utilised the aforesaid amount
for his benefit. The defendant by equitable mortgage
secured the said overdraft by depositing his Customary
Right of Occupancy in respect of his property at Ozalla
Layout, Obosi, Anambra State. On the 15th August, 2001,
the plaintiff wrote to the defendant to repay his
indebtedness of N7, 400,595.53k but the defendant failed
to do so. On the 24th of October, 2001 the plaintiff
through its solicitors wrote the defendant demanding the
payment of his entire indebtedness to the plaintiff
regarding the account aforesaid and two other indebted
accounts of the defendant. On the 1st day of November,
2001, the defendant through his solicitor admitted his
entire indebtedness to the plaintiff and pleaded with
the plaintiff to give him up to the 31st of October,
2001 to liquidate his entire indebtedness to the
The defendant filed a Motion on Notice dated 14/5/2002 praying the court to strike out the above stated suit on grounds of it being premature in that the plaintiff had not given a demand notice to the defendant before instituting the action. In the supporting affidavit, defendant admitted taking the overdraft facility but his only grouse was that no demand notice was given him by the plaintiff for the repayment of the debt.
In the course of the proceedings at the High Court, the defendant in further admission of indebtedness to the plaintiff paid in the sum of One Million Naira (N1, 000,000.00) to the plaintiff thus reducing the amount owed to the plaintiff to N6, 400,595.53k.
The version as put forward by the defendant is that the overdraft facility was for the sum of N3.5 million naira and the defendant withdrew various sums of money at different dates just as he paid in moneys to service the account. He also ran three separate accounts in the plaintiff's bank. That the three separate accounts were operated interchangeably in that the plaintiff transferred sums of money from one account to the other without the authority or knowledge of the defendant and without explanation for so doing.
He tendered what he contended to be examples of such irregular transfers which were Exhibits B, B(a), B14, B17, Exhibits C, C 49 - 3.
After hearing in the suit, the trial Court entered judgment against the appellant, who aggrieved went to the Court below which dismissed the appeal as lacking in merit hence the current appeal to this Court.
On the 13th day of January, 2014 date of hearing, learned counsel for the appellant was absent, though notified by hearing notice of the hearing and so the appeal had to go on. The Appellant's Brief of Argument settled by Chief A. B. Onyekwelu and filed on 16/5/06 was deemed argued by the Court. In it were framed two issues for determination, viz-:
1. Whether having regard to the state of the statements of account tendered by both the appellant and the respondent which the Court of Appeal never adverted to, but based its judgment on the previous admissions of the appellant, the appellant can be said to have got a fair hearing by the Court.
2. Is it correct that having regard to all the exhibits before the Court, the appellant's allegation of irregularities and illegal charges were merely peripheral.
Learned counsel for the Respondent, Miss B. A. Obiora adopted their Brief of Argument settled by Jude Obiora Esq. And filed on 16/8/06. He crafted a single issue as follows:-
Was the Lower Court right, having regard to the affidavit evidence/exhibits and admissions in the case in upholding the judgment of the trial Court?
This sole issue
as framed by the Respondent seem adequate for the
determination of this appeal and it is only right that
it be so used.
He referred to
the prominent irregularities and illegal charges which
he had highlighted in this Brief of Argument in the
FACTS as set out by him. That the appellant's case is
unassailable having regard to the exhibits before the
Court below, irrespective of his apparent admissions to
For the appellant was contended that when he made the discovery of the irregularities, he sought the service of a chartered accountant to protect his interest and reconcile the account but the respondent was not co-operative and respondent did not refute the allegation. He said since the trial court did not consider these allegations as it did not enter the matter in the general cause list, an unfair judgment on the undefended list procedure ensured which anomaly should be now rectified.
Chief Onyekwelu, of counsel submitted that account No. 2320 cannot be treated in isolation from account numbers 2349, 3098 and 1135 since the four accounts were run inter-dependently or interchangeably and the irregularities introduced by the respondent in transferring sums of money from one account to the other. That the issue of transferring sums of money from one account to the other is irregular and confusing and its consequences can only be sorted out by an accountant and so the need for trial through pleadings and or evidence whereby cross-examination would take place. He said the Rules of Court provided for suits to be placed on the undefended list are for the quick dispensation of justice and not at that the expense of the justice of the case and the principle of fair hearing. He referred to Essang v Bank of the North (2001) 6 NWLR (Pt. 709) 384 at 399; Aro v Aro (2000) 3 NWLR (pt. 649) 443 at 453; Ntukidem v Oko (1986) 5 NWLR (pt. 45) 909 at 922; Adigun v A. G. Oyo State (1987) 1 NWLR (pt. 53) 678.
Learned counsel for the Respondent, Jude Obiora Esq. submitted that once a debt is admitted by a defendant debtor who has benefited from the largess provided by the plaintiff creditor and the defendant debtor unequivocally acknowledged in writing his indebtedness, but also pleaded for and did get mercy, he is therefore stopped from wriggling out of the debt and the judgment there from.
He cited L.
T. Thadant v National Bank Ltd (1972) 1 SC 105 at 112
- 113; Bank of the North Ltd v Alhaji Bala Yau (2004)
4 MJSC 49 at 71 etc.
It was stated for the Respondent that the Defendant/appellant's attempted defence which he abandoned was filing a Motion on Notice of 14th May, 2002 asking the Court to strike out the suit on the grounds that no demand notice was given to him to repay the said debt. That the appellant later withdrew the said motion upon being over-whelmed by the Respondent's counter affidavit to the said motion.
Mr. Obiora of counsel stated on that in a business transaction between parties, once a party invites the other party by letter stating the state of affairs of the transaction, the failure of the other party to rebut same amounts to admission by conduct or representation which is what took place in this case. He referred to Sale Gwani v Emmanuel M. Ebule (1990) 5 NWLR (Pt. 149) 201 at 217; Suni Vaswani & Anor v C. A. Candide Johnson Esq. (2001) 11 NWLR (pt. 679) 582 at 588 - 589.
That sequel to the acknowledgement of indebtedness and admissions of indebtedness by the appellant, it will be unjust and contrary to Sections 19 and 20 of the Evidence Act 1990 and Order 24, Rule 9 (4) of the High Court Rules 1988 Anambra State to allow appellant to dribble the Respondent out of the judgment and postpone the liquidation of his indebtedness to the Respondent. He cited Agro Miller v. Continental Merchant Bank (Nig.) Plc (1997) 10 NWLR (Pt. 525) 469 at 477 - 478; Franchal (Nig.) Ltd v Nigerian Arab Ltd (2004) 2 NWLR (pt. 857) 434 at 451.
for the Respondent then referred to the contents of
Exhibits B, C, D, E, F1, F2 and F3 contending that none
of those Exhibits availed the Appellant so he could not
get off the debts. That Appellant has not shown how
Section 36 (i) of the 1999 Constitution of the Federal
Republic of Nigeria was infracted in relation to his
right of fair hearing in the circumstances. That a
matter on the undefended list cannot be transferred to
the general cause list just for the asking without a
defence to hang onto as in the present case. He cited Ground
Cereals and Oil Mills Ltd v As-Ahel Int. Marketing and
Procurement Ltd (2004) 4 NWLR (Pt. 652) 310 at 321 -
He submitted further that the allegation of fraud in the counsel's brief cannot be taken as established as that is not the law as fraud was not raised at the trial Court. He cited Wallingford v Mutual Society 5 AC 658 at 697.
For the Respondent was submitted that it is not enough for the defendant to merely deny a claim or aver that some payments he made were not taken into account as in this case to warrant the matter being moved from the undefended list to the general cause list. He referred to Haruna Tahir & Anor v Udeagbala Holdings (supreme) 451 and 452.
Learned counsel for the Respondent urged the Court to affirm the concurrent findings of facts and decisions in the two Courts below as there is nothing on which to base an interference by this Court. He relied on Adebayo Ighodalo (1996) 5 NWLR (pt. 450) 507 at 516; Chief L. Oyelakin v Alhaji Busari Amubikahun (1989) 3 NWLR (Pt. 107) 18 at 29.
Having set out the summary of the submissions from the opposing sides, it seems necessary to get back into the Record and reproduce as much as possible the relevant documentary materials for a clearer picture of what is at stake. First in the list of such materials is of course the supporting affidavit of the Claim of the Plaintiff/Respondent that was initiated under the undefended list and it is recast as follows:-
"AFFIDAVIT IN SUPPORT OF CLAIM
I, Clifford Igbo of Plot A/B Ogbaru Road, Niger Bridge Head, Onitsha, Bank Manager, Nigerian, make oath and say as follows:
1. That I am the Bank Manager of the Plaintiff Bank at Onitsha and I am conversant with the facts of this case.
2. I make this affidavit for and on behalf of the Plaintiff and with its authority.
3. The Defendant opened and operates a current account No. 2320 with the plaintiff.
4. The Plaintiff granted the Defendant overdraft facilities by allowing the defendant to overdraw his account from the 4th day of September, 2000.
5. The Plaintiff granted to the 1st Defendant at his request overdraft facilities amounting to N7,400,595.53k (Seven Million, Four Hundred Thousand, Five hundred and Ninety-Five Naira, Fifty-Three Kobo) with interest as at the 13th day of August, 2011, which the 1st defendant utilised.
6. The Defendant by equitable mortgage deposited his Customary Right of Occupancy in respect of his piece and parcel of land and premises thereof situate at Ozalla Layout, Obosi, Anambra State measuring approximately 463,106 square metres as delineated in Survey plan No. ECAS/891/82 attached to the said Customary Right of Occupancy granted by the Idemili Local Government Authority for a term of 99 years with effect from 1/1/84 and registered as No. 42 at page 42 in Volume 1132 at the lands Registry formerly in the Office at Enugu but now in the office at Awka to Secure the payment of all the money then owing or to be owing by himself as the defendant/plaintiff for or in respect of bills or notes discounted or paid or other loans payment, Credits advances on banking account or otherwise made to or on account of or for the accommodation or at the request of the defendant or for interest discount commission or other lawful charges and expenses which the plaintiff may in the course of its business charge for the matters hereinabove mentioned.
7. Exhibited and marked Exhibit A is the photocopy of the said Right of Occupancy in respect of the said property otherwise known as 5, Nwokediuko Street, Awada.
8. The defendant utilised the facilities granted to him by the plaintiff but failed to repay his indebtedness to the plaintiff. By August, 2001, the debt standing against the defendant in the books of the plaintiff was N7, 400,595.53k (Seven Million, Four Hundred Thousand, Five Hundred and Ninety-Five Naira, Fifty-Three Kobo). Exhibited and marked Exhibit B is Photostat copy of the 1st defendant's statement of account.
9. The total amount owed by the defendant to the plaintiff now stood at N7, 400,595.53 (Seven Million, Four Hundred Thousand, Five Hundred and Ninety-Five Naira, Fifty-Three Kobo) which sum the defendant utilised and secured with the defendant's aforementioned property.
10. The Plaintiff will found and rely on the said statements of account of the defendant account from the ordinary books of the plaintiff in the custody and control of the plaintiff the entries into which were made in the ordinary course of banking business and which said statements of account having been duly examined with the original entries in the aforesaid ordinary books of the plaintiff are correct.
11. The plaintiff is entitled to its claims against the defendant in the sum of N7, 400,595.53 (Seven Million, Four Hundred Thousand, Five Hundred and Ninety-Five Naira, Fifty-Three Kobo) with interest at the rate of Twenty-One per centum from the 1st day of September, 2001, up to the date of judgment and thereafter at the rate of Five per centum per annum until the final payment of the judgment debt.
12. The defendant have (sic) failed, refused and or neglected to pay the debt despite repeated demands.
13. The defendant has no defence to this action.
The Defendant/Appellant took out a Motion on Notice with the prayer for the Court to strike out the Claim or process of the Plaintiff/Respondent on the ground that the Respondent had not given a reasonable notice to settle the account before approaching the Court. In his supporting affidavit the Appellant averred inter alia, thus in the following paragraphs, viz:-
2. That I took an overdraft from the plaintiff/respondent at different periods but the amount is staggering.
3. That I took the overdraft between the year 2000 and 2001.
4. That between the periods in question I made some lodgements into my account.
5. That those lodgements were not reflected in the statement of account attached as Exhibit "B" in the plaintiff's affidavit.
6. That I was informed by my counsel E. N. S. Okpalugo Esq. and I verily believe that under the Nigerian Law the plaintiff cannot rush to court without giving me reasonable notice to settle the account.
7. That I intend to challenge the statement of account whilst settling the account.
8. That overdrafts granted to me by the plaintiff have no fixed date of redemption.
The Plaintiff/Respondent had deposed to a Further Affidavit to back their claim with particulars and a counter affidavit to the Appellant's motion for striking out. Thereafter the Appellant withdrew his Motion and the trial Court struck it out. He then took out a Further Affidavit in support of Notice of Intention to defend and Reply to counter affidavit. I think it necessary to reproduce this Affidavit of the Appellant and it is as follows:-
1. That I am a long time customer to the plaintiff's bank.
2. That I operated three different current Accounts with the plaintiff, as follows:- (a) CA No. 3098, (b) CA No. 2320 and (c) AC/2349.
3. That I operate Account No. CA/2320 alone and CA/2349 together with my wife.
4. That I had wanted to open one Current Account Number with the plaintiff but it was the Manager of the bank who advised me to open three separate accounts so as to comply with the Central Bank directives on Community Bank.
5. That I operated Account No. CA/3098 together with my company registered as IFEANYICHUKWU TRADING INVESTMENT VENTURES LTD.
6. That in consequence thereof the three accounts were being operated from the onset as if they are one.
7. That the overdrafts in the three accounts were granted to me in the year 2000.
8. That in 2001 the overdrafts were renewed in writing which are here exhibited as Exhibits A and B respectively.
9. That I was granted an overdraft facility of N7, 000,000.00 (Seven Million only).
10. That since taking the overdrafts in the three current accounts, I have been making reasonable deposits into the plaintiff's bank to avoid having troubles with the plaintiff. See Exhibit C which is a statement of account in respect of Account No. CA/3098.
11. That in respect of Account Number CA/2320, I have also made reasonable deposits. See also Exhibit D.
12. That in respect of Account Number CA/2349, I have also made reasonable deposits. See Exhibit E.
13. That while the suit was pending in this court, I also made another deposit of N2 Million, See Exhibit F.
14. That what prompted me to pay the said sum of N2 Million to the plaintiff while the case is in court is that the plaintiff's manager advised me that once I paid the money they will withdraw the case in court.
15. That after paying the money the plaintiff instead of withdrawing the case became more aggressive by filing and serving on my counsel series of affidavits on the 15/1/2003.
16. That on the said 15/1/2003 I was in Port Harcourt, Rivers State, and I only met my counsel on the 19/1/2003.
17. That when I went through the statements of Account supplied to me by the plaintiff's bank, I discovered a lot of irregularities and illegal charges made against me.
18. That throughout the months of September - December 2002, I have been negotiating with the plaintiff's bank towards a possible way of settling these matters out of court but the plaintiff was not cooperative at all.
19. That we are not owing the plaintiff the alleged sum of N18, 460,212.25 or at all.
20. That the issue of N18, 460,212.25k arose only in the year 2001 when the plaintiff's bank discovered that the overdraft was used by me to finance a road construction contract with the Anambra State Government.
21. That it was the plaintiff's manager who suggested that the indebtedness could be raised to N18, 460,212,25k since it will eventually be paid by the government and when I refused, he urged me to agree.
22. That the said sum of N18, 460,212.25 is a bogus claim intended to achieve some ulterior motives.
23. That the sum of N10, 08093.18k is a bogus claim prepared by the plaintiff in support of the said N18, 460,212.25k.
24. That the sum of N7, 400,595.53k is also a bogus claim in support of N18, 460,212.25k.
25. That I have engaged the services of a Chartered Accountant to protect my interest and reconcile the account but the plaintiff is not co-operative.
26. That the Chartered Accountant firm is Ambrose Ekoh & Co. Of No. 168 Oguta Road, Onitsha.
27. That I was informed by the said Chartered Accountant and I verily believe him that all the Statement of Account so far given to me contains illegal charges and interests.
28. That the said sum of N857, 523.54k is a bogus claim prepared by the plaintiff in support of the said sum of N18, 460,212.25k.
29. That the said sum of N960, 000.00 allegedly transferred from A/C No. 2349 to A/C 2320 is false since the 1st defendant, my wife told me that she did not give any such instructions and I did not receive any such money.
30. That the 1st defendant my wife told me and I verily believe that she did not make Exhibits D and D1 of the further affidavit.
There were annexures including correspondences between the parties including warning letters and demand notices from the Respondent to the Appellant. Instructive is a letter the Appellant's lawyer, P. O. T. Okojah to the Respondent dated 1/11/2001, wherein was admitted the indebtedness and a plea to be given time up to 31/10/2001 to liquidate the indebtedness. Counsel stated that the Appellant was awaiting the payment of the contract sum from the Anambra State Government and ended thus:-
"As soon as this amount is paid, we shall not hesitate to liquidate the aforesaid sum please.
Your further kind patience is highly solicited".
Considering the numerous documents including the back and forth communications between the parties and in relation to the affidavit evidence for the Respondent's undefended list process and the Appellant's Intention to defend and the accompanying affidavit, the learned trial judge, Ijem Onwuamegbu J. held as follows:-
"Although the defendant herein sought to defend this suit, he failed to file a Notice of Intention to Defend within the time limited by Order 24 Rule 9 (2) of the High Court Rules. He however filed one on the 23rd of January, 2003 and had in fact filed a day previously on 22nd January, 2003 a document titled "Further Affidavit in Support of Notice of Intention to defend and Reply to Counter Affidavit."
The procedure under which the Defendant's counsel filed a further affidavit even before a Notice of Intention to Defend was filed and in the absence of an affidavit accompanying the said notice is novel and yet to be incorporated into our statute books.
documents are before me and will be considered.
"The said Exhibit C1 is a letter from the
defendant's solicitor to the plaintiff's solicitor
admitting the defendant's indebtedness.
While Exhibit D1 is a letter to the said third party prompting it to write Exhibit D.
Although the Defendant stated in paragraph 30 of the said further affidavit in support of notice of intention to defend..."
"That the 1st defendant my wife told me and I
verily believe her that she did not make Exhibits D and
D1 of the further affidavit". I observe that exhibit D
shows clearly a letter on the letter headed paper of the
Anambra State Government signed by one Ohajianya S. C.
While Exhibit D1 shows a letter on the letter headed
paper of one Ifeanyichukwu Trading Ventures (Nigeria)
Ltd, signed by the defendant herein himself.
A careful perusal of the exhibits annexed to the defendant's further affidavit in support of notice of intention to defend..... show that Exhibit A relates to the defendant's account the subject matter of this suit and contradicts paragraph 19 therein.
Exhibit B relates to the account of one Ifeanyichukwu Trading Ventures Limited who is not a party to this suit.
Exhibit C is the statement of account of the said Ifeanyichukwu Trading Ventures limited who is not a party to this suit.
Exhibit D is the statement of account of the defendant's account the subject matter of this suit.
Exhibit E is the statement of account of one Adinuba Maureen who is unknown to this suit.
Exhibit F1 is evidence of money paid into the account the subject matter of this suit on 13/9/2002.
Exhibit F2 relates to the account of one Ifeanyichukwu Trading Ventures limited who is not a party to this suit.
Exhibit F3 is a cheque
drawn in-favour of the defendant herein.
Although leave to defend would ordinarily be given where the issue of account is called to question, the admissions in Exhibits C1 and D2 attached to the plaintiff's further affidavit in support of claim, which exhibits are not denied foreclose the issue.
I have therefore come to the conclusion that the defendant has failed to discharge the primary obligation on him to satisfy this court that there is a triable bona fide issue or question in this suit.
There will be judgment for the plaintiff as follows:-
The Defendant shall pay
to the plaintiff the sum of N7, 400,595.53k (Seven
million, Four hundred thousand, Five hundred and
Ninety-five naira, fifty-three kobo) less N1 million
naira (One Million Naira) paid by the defendant on
13/9/2001 during the pendency of this suit with interest
at the rate of five per centum per annum from the date
of judgment until final payment of the judgment debt."
Having brought out all that had transpired at the two Courts below and tackling the questions that have arisen as set out in the submissions of counsel from either side, some guides need be explored to find on which side of the divide the justice of the case resides.
Whenever application is made to a Court for the issuance of writ of summons in respect of a claim to recover a debt or liquidated money demand and such an application is supported by an affidavit setting forth the ground upon which the claim is based and stating that in the applicant's view, there is no defence thereto, the court shall if satisfied that there are good grounds for believing that there is no defence thereto, enter the suit for hearing in what shall be called the "undefended list" and mark the writ accordingly and enter thereon a date for hearing, subject to the circumstance of the particular case. If the party served with the writ of summons and affidavit delivers to the registrar a notice that he intends to defend the suit together with an affidavit disclosing a defence on the merit, the Court may give him leave to defend upon such terms as the court may think just. However, for an action to be transferred to the general cause list from the undefended list there must be a defence on the merit. It must not be a half - hearted defence. See Tahir v J Udeagbala Holdings Ltd (2004) 2 NWLR (Pt. 857) 438 at 451 per Ba'aba JCA, Franchal (Nig.) Ltd v N. A. B. Ltd (1995) 1 NWLR (Pt. 412) 172.
What is really at play here is a call for summary judgment in this undefended list procedure. The case of:-
Sunil Vaswani & Anor v C. A. Candide - Johnson (CA) (2000) 11 NWLR (Pt. 679) 582 at 586 - 587 is instructive and it was therein held:-
governing an application for summary judgment is that
a defendant who has no real defence to a suit should
not be allowed to frustrate or cheat the plaintiff out
of judgment. In this regard, the court has a duty to
assess facts presented before it in order to ensure
that there is no abuse of its processes so that there
is no delay of justice to a deserving plaintiff.
A defendant to an application for summary judgment under Order 24, Rule 9 (2) and (3) of the High Court of Anambra State, 1988 (Civil Procedure) Rules 1972 must establish that he has a good defence by showing or disclosing in his statement of defence and counter affidavit such triable issue to entitle him to be granted leave to defend the action. See Sunil Vaswani v Candide Johnson (supra) at 587.
For an Intention to Defend to be regarded as meritorious warranting the matter being transferred from the Undefended List to the General Cause List for a full hearing with the taking of evidence, oral and documentary a certain standard is required of such a defendant and the supporting affidavit of that Intention to defend must contain a defence on the merit.
not enough for the defendant merely to deny the claim
or aver that some payments he made were not taken into
account. He must set out the details and particulars
of the defence. Tahir v J. Udeagbala Holdings Ltd
(2004) 2 NWLR (Pt. 854) 438; Adegoke Motors Ltd v
Adesanya (1989) 3 NWLR (Pt. 109) 250; Nishizawa Ltd v.
Jethwani (1984) 12 SC 234; UTC v. Pamotei (1989) 1
NWLR (Pt. 103) 244; John Holt & Co. (Liverpool)
Ltd v. Fajemirokun (1961) 1 All NLR 492.
As a matter of practice, the Supreme Court will not ordinarily disturb concurrent findings of fact by the two Lower Courts except in special circumstances such as the commission of error in substantive or procedural law. Adebayo v. Ighodalo (1996) 5 NWLR (Pt. 450) 507 at 516, 527 - 530 (SC), Egonu v Egonu (1978) 11 - 12 SC 111 at 129; Chinwendu v Mbamadi (1980) 3 - 4 SC 31 at 53; Obibu v Guobadia (1984) 10 SC 130; Balogun v Amubikanhun (1989) 3 NWLR (Pt. 107) 18, NICON v. P. I. E. Co. Ltd (1986) 1 NWLR (Pt. 14) 1; Enang v. Adu (1981) 11 - 12 SC 25.
The principle above conceptualised within the ambit of the facts before court where there is an abundance of documents including those made by the Appellant wherein he admitted in full measure the indebtedness alleged by the Respondent. As earlier reproduced, the affidavit emanating from the Appellant and the letters written on his behalf by counsel, he admitted without equivocation that he owed the Respondent as claimed by them and acknowledged the Respondent had been patient with him in the delay in repayment and pleaded for further forbearance.
By Section 151 of the Evidence Act provides that when one person has, by his declaration, act or omission, intentionally caused or permitted a thing to be true and to act upon such belief, neither he nor his representative in interest shall be allowed, in any proceedings between himself and such person or such person's representative in interest to deny the truth of that thing. Ehidimhen v Musa (2000) 8 NWLR (Pt. 669) 540 per Kalgo JSC at 556 - 557.
It therefore comes like an approbation and reprobation for the Appellant at this stage to renege and advance fresh or new areas of defence being introduced such as to input fraud on the part of the Respondent in their claim or matters leading thereto. It cannot be left unsaid that fraud being of its gravity, the law insists that concrete materials must back up such an allegation in proof before fraud can change the colour of the case of the party alluding thereto.
The situation brings in view the caution which I find apt for our purpose here in the case of:- Aro v Aro (2000) 3 NWLR (Pt 649) 443 at 457 per Onnoghen JCA (as he then was).
of counsel to a party, however brilliant cannot form
or be valued as evidence in favour of a party or take
the place of evidence which is lacking in his case".
v Ajiboye (1998) 1 NWLR (Pt. 532) 71; Chukwujekwu v
Olalere (1992) 2 NWLR (Pt. 224) 86; Bello v N. B. N.
Ltd (1992) 6 NWLR (Pt. 246) 206; Ugorji v. Onwuka
(1991) 4 NWLR (Pt. 237) 226.
In this regard is relevant the case of Kenfrank (Nig.) Ltd v. UBN (2002) 8 NWLR (Pt. 789) 46 at 74 which seemed to have had the case at hand in mind when the Court of Appeal per Ikongbeh JCA held as follows:-
"I am not happy that Senior Counsel should lend his name to such underhand conduct. By all means, counsel had the right and duty to throw all his endeavours behind his client's cause. In my view, however, the line must be drawn somewhere, where as in this case, the defendant had unequivocally admitted indebtedness in writing and expressed willingness to pay up, counsel should encourage along the path of honour rather than employ any legal brinkmanship to defeat the cause and course of justice."
Where a trial Court finds as in this case that defendant has no defence to a plaintiff's suit placed under the undefended list, the court has no option other than to enter judgment for the plaintiff for the sum of money claimed. Tahir v J Udeagbala Holdings Ltd (supra) 451-452.
The conclusion I see is that the Appellant's affidavit to support his attempt with his Intention to defend lacked particularity or details which lapses were to be filled, I guess by the Court which I do not know how that would have been done. The situation was all the more worsened by the various admissions of the Appellant which this later day about face cannot change for his good. There being no perversity in the concurrent findings of the two Courts below or any shadow of a miscarriage of justice or a wrong application of the law, there is no other option open to this Court than to uphold those findings. It is for that, that I resolve the issue here against the Appellant and as a follow up, this appeal lacks merit and I do not have any hesitation in dismissing it.
hereby dismissed and I affirm the decision of the Court
of Appeal which in turn affirmed the Judgment and Orders
of the Trial High Court.
facts of this case as captured in the judgments of the
trial Court and the Court below are that the Appellant
had been and is still a customer of the Respondent. The
Appellant was granted over-draft facility in his
personal Account No. 2320 by allowing him to overdraw
this account to the tune of N7, 400,595.53 which he
utilized. On 15th August, 2001, the Respondent wrote to
the Appellant demanding the payment of the debt due to
the Respondent. On 1st November, 2001, the Appellant
through his Solicitor wrote a letter Exhibit C1 to the
Respondent admitting the indebtedness of the Appellant
and pleaded for time to allow the Appellant to settle or
liquidate the overdraft. On 2nd May, 2002, another
letter Exhibit D was also written to the Respondent on
behalf of the Appellant admitting his indebtedness to
the Respondent and pleading for time to liquidate the
same. Inspite of his admission to the debt, the
Appellant failed to take the promised steps to liquidate
the debt resulting in the Respondent instituting the
suit on the Undefended list at the trial Court against
trial Court entered judgment for the Respondent on
taking into consideration that the Appellant having
admitted the claims against him and had already started
liquidating the debt by the payment of the sum of N1,
000,000.00, there was no need under the law to hear the
case on pleadings. No wonder, the Appellant's appeal to
the Court of Appeal against the judgment of the trial
Court was dismissed to give rise to the present appeal.
For the forgoing reasons, I am of the strong view that this appeal is frivolous which deserves nothing but a dismissal as decreed in the lead judgment of my learned brother Peter-Odili, JSC which I have had the opportunity of reading before today and with which I entirely agree that this appeal must be dismissed. I also dismiss it and abide by the orders contained in the lead judgment including the order on costs.
I had a preview
of the judgment just delivered by my learned brother -
Peter-Odili, JSC. I agree with the reasons advanced
therein to arrive at the conclusion that the appeal
lacks merit and should be dismissed.
"...It is not in doubt that our client is indebted to your client to the tune of the amount herein stated. May we bring to your notice that our client is willing to liquidate the above sum so as not to put your bank in distressed position as you humbly contended. Our client has instructed us to urge you to give him up to 31/10/2001 to liquidate the indebtedness ... Your further kind patience is highly solicited."
Further to the
above, on 2/5/2002, at the instance of the appellant,
one Mr. S. C. Ohajianya, Special Assistant to the
Executive Governor of Anambra State, on transport wrote
Exhibit D and annexed Exhibit D1 written to him by the
appellant admitting his indebtedness to the respondent.
He pleaded with the respondent in Exhibit D to exercise
patience with the appellant. As can be seen in Exhibit
'E.1', the appellant made a part-payment of the sum of
=N=1,000,000:00 to reduce his debt to the respondent.
me observe it briefly that the appellant's counsel
tersely alluded to issue of fraud. He argued that 'not
only that baseless interests were charged, but they were
fraudulently inflated'. The appellant must appreciate
that fraud must be pleaded with particulars supplied and
evidence must be led on same. See: George v. Dominion
Flour Mills Ltd. (1963) All NLR 70 at 77 and Aina v.
Jinadu (1992) 4 NWLR (pt. 233) 91 at 106. Apart from the
above, since fraud is a crime, it must be proved beyond
The two courts below concurrently found that the respondent clearly depicted the appellant's indebtedness. The appellant failed to disclose any tenable defence. He failed to raise any concrete issue in the matter. The trial court was justified in its findings of fact. Equally, the court below was right in affirming the stance of the trial court. The concurrent findings are not, in any respect, perverse. I cannot interfere with same under any guise. See: Anaeze v. Anyaso (1993) 5 NWLR (Pt. 291) 1.
For the above
remarks and of course the lucid reasons adumbrated in
the lead judgment which I hereby adopt, I too feel that
the appeal is devoid of merit and should be dismissed. I
order accordingly. I endorse all consequential orders
contained in the lead judgment; that relating to costs
I read in draft the lead judgment of my learned brother Ukaego Peter-Odili JSC and agree with the reasonings and conclusion therein that this appeal lacks merit and same be dismissed.
must restate that a plaintiff who has taken out a writ
under the undefended list must have his way if the
defendant fails to disclose a defence on the merit to
the claim. The principle has and justice dictates it
must so remain that the defendant who has no defence to
the plaintiff's claim is not allowed to push the matter
needlessly into full trial thereby not only cheating and
frustrating the plaintiff but abusing the process of the
court as well. See Nishizawa V. Jethwani (1984) 12 SC
234 and Macaulay V. NAL Merchant Bank (1990) 4 NWLR (Pt
I have had the
benefit of reading before now the lead judgment of my
learned brother, PETER-ODILI, JSC, just delivered. I
agree with the reasoning and conclusion that the appeal
lacks merit and should be dismissed. In support of the
lead judgment I wish to add a few comments for emphasis.
filed a Notice of Intention to defend the suit and a
further affidavit in support. His defence to the claim
was that though he maintained several accounts with the
respondent, they were operated interchangeably as one
account. He denied owing the sum of N18, 460, 212.25,
which amount, incidentally, was not the amount claimed
in the suit. He admitted being granted overdraft
facilities by the respondent but averred that the
statement of account issued to him by the respondent
contained irregularities and illegal charges.
course of the proceedings, the appellant paid a sum of
N1 million (shown on Exhibit E) to the respondent in an
attempt to reduce his indebtedness. After considering
the affidavit evidence before it and carefully perusing
the exhibits annexed thereto, and taking into account
the N1 million naira paid by the appellant to reduce the
debt, the trial court concluded that the appellant had
failed to show that there was a triable bona fide issue
for determination in the suit to warrant its transfer to
the general cause list. Judgment was therefore entered
in the respondents favour in the sum of N7, 400, 595.53
(Seven Million, Four Hundred Thousand, Five Hundred and
Ninety-Five naira, Fifty-Three kobo) less N1 Million
paid by the defendant on 13/9/2002 during the pendency
of the suit with interest at the rate of five per centum
per annum from the date of judgment until final payment
of the judgment debt.
Was the lower
court right, having regard to the affidavit
evidence/exhibits and admissions in the case, in
upholding the judgment of the trial court?
This court in Nishizawa Ltd. v. Jethwani (1984) 12 SC 234 at 260, set out what a defendant's affidavit in a summary judgment procedure wherein he is seeking to be let in to defend the action must show:
a. It should "condescend upon particulars" and as far as possible, deal specifically with the plaintiff's claim and affidavit and state clearly and concisely what the defence is and what facts are relied on as supporting it;
b. State whether the defence goes to the whole or part of the claim, and in the latter case, specify the part;
c. Where the defence is that the defendant is not indebted to the plaintiff, state the grounds on which the defendant relies as showing that he is not indebted. A mere general denial that the defendant is not indebted will not suffice;
d. Where the affidavit states that the defendant is not indebted to the plaintiff in the amount claimed or any part thereof, state why the defendant is not so indebted, and to state the real nature of the defence relied on;
e. Where the defence relied on is fraud, state the particulars of the fraud. A mere general allegation of fraud is useless;
f. If a legal objection is raised, state clearly the facts and the point of law arising therefrom;
g. In all cases, give sufficient facts and particulars to show that there is a bona fide defence;
h. Also, matters of hearsay are admissible, provided that the source and grounds of information and believe (sic) are disclosed.
Vs NAL Merchant Bank Ltd. (supra) at 306 - 307 D - C;
Adegoke Motors Ltd. Vs Adesanya (1989) 3 NWLR (Pt.
109) 250 @ 271 - 272 H - A; UTC Nig. Ltd. Vs Pamotei
(2002) FWLR (Pt. 129) 1557; (1989) 2 NWLR (Pt. 103)
244; Nkwo Community Bank (Nig.) Ltd. Vs Obi (2010) 14
NWLR (Pt. 1213) 169.
It is not in doubt that our client is indebted to your client to the tune of the amount herein stated. May we bring to you notice that our client is willing to liquidate the above sum so as not to put your bank in distressed position as you humbly contended.
Our client has instructed us to urge you to give him up to 31/10/2001 to liquidate the indebtedness. This is in view of the fact that HIS EXCELLENCY, DR. C.C. MBADINUJU has promised to pay our client the contract sum he expended in the construction and tarring of both Ogbo-efere Road, Okpoko and one of Okija any moment from now.
soon as this amount is paid, we shall not hesitate
to liquidate the aforesaid sum please. Your
further kind patience is highly solicited. Thank you."
The contents of Exhibit C1 confirm the contents of the letter subsequently written to the respondent by the Special Assistant to the Governor (Exhibit D) pleading for more time on the appellant's behalf. By Exhibit E1 he paid the sum of N1 million to reduce his indebtedness. Contrary to the appellant's contention, the averment in his further affidavit that there were irregularities in his statements of account could not in any way put his earlier clear and unequivocal admission of indebtedness in doubt. The trial court was entitled to rely on it in refusing to transfer the suit to the general cause list and the lower court rightly, in my view, affirmed its decision.
is important to note that the issue of fraud raised by
the appellant in his brief of argument before this court
was never raised at the trial court nor at the court
below. A party must be consistent in presenting his
case. An issue not raised at the trial court cannot be
raised at the appellate court through the ingenuity of
counsel. See: Balogun Vs Adejobi (1995) 1 SCNJ 242;
(1995) 2 NWLR (Pt. 376) 131; Olatunji Vs Adisa (1995) 2
SCNJ 90; (1995) 2 NWLR (Pt. 376) 167; Orunengimo &
Anor. Vs Egebe & Ors. (2007) 15 NWLR (Pt. 1058) 630;
(2007) 7 SC (Pt. II) 197. In any event the particulars
of fraud must be specifically pleaded. Being criminal in
nature, the allegation must also be proved beyond
reasonable doubt. The averments
in the appellant's affidavit were completely bereft of
necessary particulars and fell short of this important
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