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 CHAMPION BREWERIES PLC

V.

1. SPECIALTY LINK LIMITED
2. AKWA IBOM STATE GOVERNMENT



Date


28th May, 2014

Practice Area

1.   DEBTOR- CREDITOR LAW

2.   COMMERCIAL/COMPANY LAW

3.   CONSTITUTIONAL LAW

4.   LITIGATION



Originating Court


KADUNA STATE HIGH COURT (J. ABIRIYI, J.)



Court


COURT OF APPEAL


Citation(s)

CA/K/16/2006, (2014); LN-e-LR/2014/32 (CA); LPELR-23621(CA)



Judge(s)


ABDU ABOKI, ITA G. MBABA, HABEEB ADEWALE OLUMUYIWA ABIRU JJCA

Counsels


Chief Ijim Omoigberale KSM for Appellant

S. M. Nwosu Esq. for Respondent


Main issue(s)


APPEAL- whether need for leave to appeal against final judgment

 

JURISDICTION- whether parties can confer on a court, where it has none- whether a party who willingly submits to, and takes part in the trial of his case can question the powers of the court on appeal

 

LAW OF CONTRACT-breach of contract

 

CONSTITUTIONAL LAW-right to fair hearing

Cases referred to

Ayoade v. Spring Bank Plc (2014) 4 NWLR (Pt. 1396) 93

Garba v. Ummuani (2013) 12 WRN 76

Petroleum Co. Ltd v. FCMB (2014) 3 NWLR (Pt. 1394) 346 (2013) LPELR-21874(CA)

Onwugbufor v. Okoye (1996) 1 NWLR (Pt. 424) 259

Kwazo v. Railway property Co. Ltd: CA/K/41/06

NDIC v. CBN (2002) 3 SC 8

Thompson v. University of Calabar (2004) ALL FWLR (Pt. 209) 1148

Amana Community Bank Nig Ltd v. Mr. Okwu Olu (2003) FWLR 9 (Pt. 158) 1308

Ekuma v. Silver Eagle Shipping Agencies Ltd (1987) 4 NWLR (Pt. 65) 472

Societe General Bank Nig Ltd v. Adewunmi (2003) FWLR (Pt. 158) 1181

Mobil Producing Un-ltd v. Lagos State Environmental Protection Agency (2002) LPELR 1887 (sc)

Adepoju v. INEC (2012) 21 WRN 38

Akinpolarin v. Akinnola (1994) 3 NWLR (Pt. 335) 659

Ikedigwe v. Fai (2012) 10 NWLR (Pt. 1308) 375

Udo v. RTBC and S (2013) 14 NWLR (Pt. 1375) 488

University of Ilorin v. Olawepo (2012) 52 WRN 42

Rivers State Govt. v. Specialist Konsult 2005 MJSC 19; (2005 LPELR-2950(SC)

Akin Folorunso v. Shaloub (1994) 3 NWLR (Pt. 333) 413

Afribank Nig. Plc v. Yelwa (2011) 12 NWLR (Pt. 1261) 287

Zaria Local Govt. Council v. Kwastan CA/K/151/09

CEEKAY Traders Ltd v. General Motors Co. Ltd (1992) 2 NWLR (Pt. 222) 132

Alh. Muhammed Alikeo Mohammed v. Adebodun Sheriff Kazeen & Anor. CA/K/317/2010

Guaranty Trust Bank Plc v. Fadco Industries (Nig) Ltd (2013) LPELR-21411(CA)
Oyekanmi v. NEPA (2000) LPELR-2873(SC)

General Electric Co. v. Akande (2012) ALL FWLR (Pt. 637) 1474

Amadi v. INEC (2012) ALL FWLR (Pt. 627) 1415

Military Gov, of Lagos State v. Adeyiga (2012) ALL FWLR (Pt. 616) 396

Aboyeji v. Lateju (2012) ALL FWLR (Pt. 648) 961

Ayoade v. Spring Bank PLC (2014) 4 NWLR (Pt. 1396) 93

First Bank of Nigeria v. I.A.S. Cargo Airlines Nig. Ltd (2011) LPELR-9827(CA)

UBN v. SAX Nig Ltd (1994) 8 NWLR (Pt. 361) 150

UBN v. Oziyi (1994) 3 NWLR (Pt. 363) 385

Hausa v. First Bank of Nigeria Plc CA/J/295/981 unreported decision of this court delivered on 12/4/2000

UBN v. Salami (1998) 3 NWLR (Pt. 538)
Idakula v. Richard (2001) FWLR (Pt. 693) 111

 


FULL REPORT

 

ITA G. MBABA, J.C.A. (Delivering the Leading Judgment):

 

This is an appeal against the judgment of Kaduna State High Court, in Suit No. KDH/KAD/185/99, delivered on 13/6/2003 by Hon. Justice J. Abiriyi (as he then was), wherein his Lordship entered judgment for the Plaintiff (now 1st Respondent) and awarded 8% interest on the original sum of N21,750,000.00 loaned to the 1st Defendant (now Appellant) and guaranteed by the 2nd Defendant from 6/4/98 to the date of full liquidation. The trial court had dismissed the claim for special and general damages, sought by the 1st Respondent.

Appellant was granted extension of time/leave by this court, on 19/4/04, to file this appeal and it did so as per pages 266 to 267 of the Records of Appeal, disclosing 3 grounds of appeal, as follows:

 

(1)     The Learned Trial Judge erred in law when he assumed jurisdiction to entertain this suit when the court lacked the jurisdiction to entertain same.

PARTICULARS OF ERROR

 

(a)     The contract, the subject matter of the action, was entered into in Uyo, Akwa Ibom State.

 

(b)     The Defendants in the suit are resident in Uyo, Akwa Ibom State.

(c)     The performance and/or object of the contract was in Uyo, Akwa Ibom State.

 

(2)     The Learned Trial Judge erred in Law in awarding the claim of interest to the plaintiff as there was no basis for interest in the loan agreement.

PARTICULARS OF ERROR:

 

(a)     The loan granted by the plaintiff to the 1st Defendant was clearly agreed to be interest fee.

 

(b)     The supposed oral agreement, by the 2nd Defendant to pay 8% interest on the loan is invalid as the 2nd Defendant, not being a principal party to the loan agreement, cannot agree to any interest without the principal party.

 

(c)     An oral agreement cannot alter a written agreement.

 

(3)     The Learned Trial Judge erred in law by calling on the Plaintiff to address the Court on the same day the Defendants were foreclosed, from cross examining PW2 and thereby denied defendants fair hearing.

PARTICULARS OF ERROR:

 

(a)     On the day the Defendants were foreclosed from cross examining the PW2, the Defendants were not given any opportunity to put in their defence.

 

(b)     There was no adjournment for the Defendant to put in their defence:

(c)     The Defendants were not given any opportunity to prove their counter claim."

 

Appellant filed its brief on 21/12/2004 and distilled 3 issues for determination, as follows:

 

(1)     Whether the entire proceedings and judgment of the lower court is not a nullity as the said court lacked jurisdiction to have entertained the matter (Ground 1).

 

(2)     Whether the entire proceedings and judgment of the lower court is not vitiated by the fact that the Appellant was denied its right of fair hearing (Ground 3).

 

(3)     Whether there was any basis in law for the award of 8% interest on the original loan of N21,750.000.00 from 6/4/98 to the date the loan was fully repaid, when same was never claimed by the 1st Respondent. (Ground 2)"

 

The 1st Respondents filed their brief on 13/1/06, with the leave of court and raised a preliminary objection to the appeal in the Respondent's brief (pages 2 to 6 thereof). On the main appeal, 1st Respondent argued same on the following issues:

"(1)   Whether the Trial Court lacked the jurisdiction to entertain the plaintiffs' claim (Ground 1)

 

(2)     Whether the Appellant was denied fair hearing in the entire proceedings leading to the judgment of the court (Ground 3)

 

(3)     Whether a subsequent oral agreement is admissible to vary or supplement the terms of a written agreement. (Ground 2)"

 

Appellant filed a reply brief on 22/9/06 to contest the preliminary objection.
When this appeal was heard on 19/3/14, the parties adopted their briefs and moved us accordingly, after the argument of the preliminary objection.
A brief facts of the case, as articulated by the 1st Respondent, shows that Appellant, guaranteed by the 2nd Defendant, obtained a friendly loan from the 1st Respondent, sometime in 1997, in the sum of 21.75 million, free from interest and charges, payable within 180 days; that the Appellant and the 2nd Respondent further agreed to be liable to 1st Respondent for any loss or injury occasioned to the 1st Respondent, as a result of the non-payment of loan (See Exhibit 1). Appellant and the 2nd Defendant defaulted on the repayment of the loan at the due date, and subsequently, in a meeting between the parties, 2nd Appellant reached agreement to pay 8% interest, monthly, from the date of default until the principal sum was fully liquidated. Appellant and the 2nd Defendant thereafter paid N17million of the principal sum and failed to pay the outstanding balance. The Respondent (as plaintiff,) commenced the action under the undefended list and claimed a total sum of N12,834,193, being outstanding balance of the loan had and received and 21% interest per annum from 1/1/99 to the date of judgment, and thereafter at the rate of 10% until the judgment sum was fully liquidated.

 

The Defendants, who were represented by the Attorney General of Akwa Ibom State, filed a notice of intention to defend the suit and admitted owing the balance of the loan, that is, N4,750,000.00, disputing the remaining claim representing interest. Judgment was entered for the Plaintiff in the said sum of N4.75, while the rest of the claim was transferred to the general cause list for hearing and determination, on pleadings.

 

The Plaintiff (Respondent) filed pleading and claimed N8,084,193.00 as special and general damages for breach of contract and 8% interest from 31/12/98 up to the date of judgment and thereafter at the rate of 10%,until full liquidation of the judgment debt. The Defendants refused and neglected to file their defence and to attend court on the date fixed in the presence of both counsel for the hearing of the case. That was on 28/6/99, and so the Plaintiff asked for judgment in default of the pleadings, pursuant to Order 26 Rule 2 (1) of the Kaduna State High Court (Civil Procedure) Rules 1987, and the Court entered judgment accordingly.

 

Appellant and the 2nd Defendant, thereafter sought an order of the trial court to set aside the judgment, but the trial court noted that the affidavit in support was based on falsehood, but all the same granted the application in the best interest of justice and set aside the judgment on 28/6/99. The Defendants thereafter filed their defence and a Counter-claim.

 

The Plaintiff thereafter led evidence in proof of its case and the case progressed until 12/3/2003 when the case was adjourned to 6/5/2003 for Cross-examination of PW2, defence and possibly, address.

 

On the 6/5/2003, the parties were absent but the plaintiff was represented by Counsel, Mr. Nwosu, who asked for another date, saying, he was informed by the Court Registrar, that the Defence Counsel called earlier to say he was bereaved. The case was adjourned to 9/6/2003 and on that date the defendants and their Counsel were absent and the Plaintiff's Counsel expressed disappointment and asked the court to discharge the PW2, who had been recalled for cross-examination, and for closure of the defence case and for address.

There was allegation that the Defence Counsel had been notified of the date of adjournment (9/6/03). The court therefore granted the application of the Plaintiff, discharged the PW2 from Cross examination, closed the case of the defence and allowed the Plaintiff's Counsel to address it. See pages 246 - 251 of the Records of Appeal. The court then adjourned the case for judgment, which was delivered on 13/6/03, when it entered judgment for the Plaintiff, in part, that is in respect it called;

 

"8% interest agreed between the parties as a result of the breach of the agreement between them from the 6th of April, 1998 until the date it fully paid the original sum of N21.75, it lent to the 1st Defendant and guaranteed by the 2nd defendant. The 8% shall be calculated for that period only." See page 259 of the Records.

 

The 1st Respondent had raised objection to this appeal in its Brief of argument. We have always said that a valid objection to the hearing of appeal has to be filed in court, apart from being raised, at least 3 days, before the hearing of the appeal to give the Appellant due notice. That emphasis is, however, stressed in the 2011 Court of Appeal Rules - Order 10 Rule 1.

 

See the case of Ayoade v. Spring Bank Plc (2014) 4 NWLR (Pt. 1396) 93 at 116:

 

"By virtue of Order 10 Rule 1, Court of Appeal Rules, 2011, a Respondent raising preliminary objection on appeal must, first of all, file a notice of preliminary objection, before canvassing argument on it in his brief of argument, (Moyosore v. Gov. Kwara State (2012) 5 NWLR (Pt. 1293) 242; Esoho v. Asuquo (2007) ALL FWLR (Pt. 359) Bayero v. Mainasara & Sons Ltd (2006) 8 NWLR (Pt. 982) 391 referred to)."

 

The reason for this is that, where the objection is raised in the Respondent's brief, there is no way of proving that the preliminary objection had been 'filed' as required by law, and it is the filing fees that breathe life onto a court process, where fees are required for filing. Garba v. Ummuani (2013) 12 WRN 76.


The Respondent did not file the said preliminary objection. But it must also be said that failure to comply with that rule is not fatal, as it is only an irregularity, which can be remedied by an order to pay the fees, upon the defect being highlighted, See Samba Petroleum Co. Ltd v. FCMB (2014) 3 NWLR (Pt. 1394) 346 (2013) LPELR-21874(CA); Onwugbufor v. Okoye (1996) 1 NWLR (Pt. 424) 259.

 

The issues for determination of preliminary objection are:

 

"(1)   Whether the Appellant's appeal which has not been entered in the Court of Appeal is competent.

 

(2)     Whether grounds 2 and 3 of the grounds of appeal being mixed law and facts are competent grounds, when no prior leave of court was sought and obtained before raising and arguing the grounds.

(3)     Whether issue No. 3 as formulated and argued by the Appellant was derivable from ground 2 of the appeal as contended by Appellant, or from any of the grounds of appeal."

 

On the 1st issue, the Respondent alleged that Appellant in this appeal merely copied the appeal No. CA/K/425/2014, assigned to a sister appeal filed by the 2nd Respondent in this appeal; that whereas the Appellant and the said 2nd Respondent were defendants at the Court below, and each of them filed Notice of Appeal against the judgment of the Trial Court, only the appeal by the 2nd Respondent was entered in this court.

 

Without bothering to go over the whole arguments of the parties on this, I think it is the 1st Respondent that is confused as to which appeal we are hearing. The Records of Appeal in this matter bears the Number CA/K/16/2006 and it was transmitted to this court on 29/11/04. There are two Notices of appeal one filed by the 2nd Respondent herein (Akwa Ibom State Government) and the other by Appellant, on pages 260 to 265 and 266 to 267, respectively. The Briefs of the parties in this appeal carry the Appeal Number CA/K/16/2006 (written by hand, after crossing the printed No. CA/K/425/04). The 1st Respondent's motion for extension of time to file its Respondent's Brief had also Crossed Appeal No. CA/K/425/M/04 in favour of Appeal No. CA/K/16/06.

There is also evidence that the Appellant obtained the order of extension of time by this Court to file the Appeal; that was on 19/4/04. I think, whatever question that may disturb the 1st Respondent on the administrative handling of the two appeals and the assignment of numbers to them cannot be directed at or blamed on the Appellants, as that remains a problem of the Registry of this Court, which, I believe had been resolved, and the parties are not confused that this appeal (No. CA/K/16/06) was originated by the Appellant. This above, however, shows why parties, who fought a case together at the trial court should always stay together on appeal, rather than duplicate their efforts and costs in filing separate appeals over the same issue.

 

On the 2nd Issue, it is obvious that learned Counsel for the 1st Respondent has greatly misconstrued the law. We have held, several times, that any appeal raised against a final judgment of the High Court, sitting at first instance, is appealable, as of right, without any need to seek and obtain the leave of the High Court or of this court, whether the grounds of appeal are of facts or of mixed facts and law or of law alone. That is the purport of Section 241(1)(a) of the 1999 Constitution, as amended. See also the case of Garba v. Ummuani (2013) 12 WRN 76; Kwazo v. Railway property Co. Ltd: CA/K/41/06 delivered on 13/5/14.

 

On Appellants Issue 3, (which I have earlier reproduced), not being derivable from ground 2 or any ground of the appeal, I think the 1st Respondent's observation on the relationship between the Issue 3 and ground 2 of the appeal is wrong. The ground 2 of appeal was that the learned trial judge erred in law in awarding the claim of interest to the Plaintiff as there was no basis for interest in the loan agreement. The 3rd issue for determination, which is whether there was any basis in law for the award of 8% interest on the original loan of N21,750,000.00, is proper and in order, in my humble opinion.

I hold that the preliminary objection was therefore misconceived, and I dismiss it, as the grounds of appeal and issues distilled from them are properly in place.
Appellants Counsel, Chief Jim Omoigberale KSM (who settled the brief), on issue 1, submitted that the entire proceedings and the judgment of the trial court was a nullity, because the court lacked jurisdiction to entertain the suit, the reason being that the Defendants were based and resident in Uyo, Akwa Ibom State. Counsel said the 1st Respondent's chairman, testifying as PW2, told the court that he, an indigene of Akwa Ibom State, was approached for the loan transaction while he was at home in Akwa Ibom State on holiday; that he went to the government house and met the Military Administrator of the State, where the negotiation for the friendly loan took place; he later met the Board of directors of the Appellant and they finally agreed on the friendly loan and gave the same, with a written agreement to that effect. Thus, Counsel submitted that no part of the transaction occurred in Kaduna, that even the collateral pledged as security for the loan were warehouses situate in Calabar and Ogoja in Cross-River State, all outside the territorial jurisdiction of the trial court that the trial court was therefore wrong when it assumed jurisdiction in the case. He relied on Order 10 Rules 2 and 3 of the Kaduna State High Court (Civil Procedure) Rules 1987, on the limits of territorial jurisdiction –

 

that "All suits for specific performance, or upon the breach of any contract shall be commenced and determined in the judicial division in which such contract ought to have been performed, or in which the defendant resides or carries on business."

 

Counsel urged us to hold that the entire trial and decisions amounted to a nullity as the court wrongly assumed jurisdiction, which it lacked. He relied on some decided authorities including NDIC v. CBN (2002) 3 SC at 8; Thompson v. University of Calabar (2004) ALL FWLR (Pt. 209) 1148 AT 1168.
On issue 2, Counsel submitted that the entire proceedings and judgment were vitiated because the Appellant was denied right of fair hearing; that the Plaintiff's case was closed on 3/10/02, while the matter was adjourned for defence in the absence of the Appellant with an order that Appellant should be served, (Page 241 of the Records); that the 1st Respondent had difficulties in serving the hearing notices on the Appellant until 15/1/03, when it brought a motion ex-parte for an order of substituted service, through DHL - courier services, which application was granted. (Pages 84-86 and 243-244 of the Records).

Counsel submitted that upon proper service by DHL, the Appellant was represented in court on 12/03/03 and he brought application to recall the PW2 for cross examination, which was granted. The matter was, thereafter, adjourned to 6/5/03 for the Cross examination, defence and possible address; that on the said 6/5/03, the Appellant's counsel was absent because he was bereaved and the court then adjourned the matter to 9/6/03 for defence with an order that Appellant be served. (Page 246 of the Records).

 

Counsel submitted that the order of 9/6/03, that Appellant be served notice of the new date was not carried out by the Registry of the court, but that the trial court relied on the mere ipse dixit of the 1st Respondent's Counsel and its Registrar, that the date had been communicated to Appellant's Counsel, to discharge the PW2, deny the Appellant the right of defence, took address of the Plaintiff and adjourned the case for judgment on 13/6/03, with an order that the Appellant be served with the hearing notice (pages 246 - 251 of the Records).
Counsel noted an unusual hurry by the trial judge on the said 9/6/03 to deny the Appellant right of hearing, and said that the failure to serve the Appellant with new dates of adjournment, ordered on 6/5/03 and 9/5/03 was fatal; that the service should have been effected by DHL as ordered by the court on 15/1/03. He relied on the case of AMANA COMMUNITY BANK NIG LTD v. MR. OKWU OLU (2003) FWLR 9 (Pt. 158) 1308 AT 1320 - 1321; EKUMA v. SILVER EAGLE SHIPPING AGENCIES LTD (1987) 4 NWLR (Pt. 65) 472 SOCIETE GENERAL BANK NIG LTD v. ADEWUNMI (2003) FWLR (Pt. 158) 1181 AT 1190.

Counsel further noted that Appellant had a counter claim at the lower court but the court said nothing about it while closing the defence of the Appellant, ordering address by the 1st Respondent on 9/6/03 and reading its judgment on 13/6/03; that the judgment therefore failed to address all the issues, placed before the court and was invalid.

 

On Issue 3, Appellant reproduced the paragraph 25 of the 1st Respondent's pleading at the lower court as stated on pages 21 - 23 of the Records:

"Whereupon the Plaintiff claims against the defendants jointly and severally the sum of N8,084,193.00 as special and general damages for breach of contract and 8% interest from 31st day of December, 1998 up to the date of judgment and thereafter at the rate of 10% until judgment sum is fully liquidated."

 

Counsel submitted that parties are bound by their pleading and any evidence adduced contrary to the pleadings goes to no issue; that it is not open for the court to make a case for any party different from what is placed before it by the parties; that though the court can award less than what is claimed by the parties, it cannot award more then what a party claims, or what is not claimed.
Counsel submitted that considering the above claim of the 1st Respondent, and the above principles, governing awards, the trial court violated every known principle, went on a voyage of its own, to make award which is not supported by any law or legally admissible facts of the case. He submitted that the 8% interest claimed by 1st Respondent related to the claim of N8,084,193.00, that the said amount claimed (or part of it) has to be awarded, before the 8% interest can be awarded, as it ought to be computed on the amount awarded; that in this case, the amount claimed as special and general damages were not established and was dismissed, but, strangely, the court went forward to award the 8% interest saying;

 

"From the nature of the agreement between the parties which was a friendly loan and the subsequent oral agreement between them that 8% interest be paid as a result of the breach from the date of the breach and to mitigate (sic) loss to the Plaintiff. I am reluctant to award general damages... The claim of the Plaintiff succeeds in part. The Plaintiff shall be paid by the Defendants jointly and severally the 8% interest agreed between the parties as a result of the breach of agreement between them from the 6th of April 1998 until the date it fully paid the original sum of N21,750,000.00 it lent to 1st Defendant and guaranteed by the 2nd Defendant. The 8% shall be calculated for that period only." (Page 259 of the Records)

 

Counsel submitted that having refused to award the main claim of the Appellant for N8,084,193.00 as special and general damages, the court should have dismissed the suit; that the 8% interest on the original loan of N21,750,000, from 31/12/98 to date of payment was never before the Trial Court; that decision was not only strange but also bizarre.

 

Counsel further submitted that the evidence relied on for the award was not legally admissible as the loan agreement was covered by a written agreement (Exhibit 1), whereas the alleged agreement to pay 8% interest was said to be oral, land made by 2nd defendant (guarantor); that Exhibit 1 had clearly stated that the loan was interest free! He submitted that oral evidence cannot be admitted to alter, vary or defeat a written agreement.


Moreover, Counsel said there was no indication Appellant consented to the alleged oral agreement and it was not stated when the PW1 started to compute the interest and on which amount the computation was done!
He urged us to resolve the issues for Appellant and allow the appeal.

The 1st Respondent's Counsel, S. M. Nwosu Esq.; on issue one, submitted that the trial court had jurisdiction to entertain the case, because 1st Respondent had pleaded that the loan agreement was entered into in Kaduna and that the loan was advanced to Appellant at Kaduna by means of bank draft, through it bankers in Kaduna. See paragraphs 5 and 12 of the statement of claim (page 21 of the Records). Counsel referred us to paragraph 2 of Appellant's statement of defence, where they stated: "Defendants admit paragraph 5 but add that the request was for N21.75m friendly and interest free loan"; he said that the Appellant also admitted receiving the friendly loan granted as per the Plaintiff's averment in paragraph 12 of the statement of claim, that the payment was made to them in Kaduna through Plaintiff's bankers in Kaduna.

 

I do not think it is necessary to be-labour further arguments on this issue, i.e., whether or not the trial court had jurisdiction to entertain the suit. Even if the Appellant were to have effectively denied that the loan transaction was partly negotiated in Kaduna and also paid in Kaduna through 1st Respondent's bankers in Kaduna, the mere fact that the Appellant submitted to the jurisdiction of the trial court, filed notice of intention to defend the suit, offered to liquidate the original loan by paying the balance of N4.75m and paid the same; applied for the rest of the matter to be sent to the general cause list, for determination and even filed a counter claim in the case, shows that Appellant had accepted and submitted to the jurisdiction of that court and even sought its protection. It cannot therefore complain on appeal.

 

I believe, when it comes to territorial jurisdiction of a court, a party who willingly submits to the jurisdiction of a court and takes part in the trial of his case, cannot turn round, on appeal, to question the powers of the court to hear his case, as long as the court was seized with power over the subject matter of the claim.

In the case of Mobil Producing Un-ltd v. Lagos State Environmental Protection Agency (2002) LPELR 1887 (sc), it was said that;

 

"The rule of jurisdiction, as held by this court ... is that nothing shall be intended to be out of the jurisdiction of a superior court but that which specifically appears to be so. That an irregularity in the exercise of jurisdiction should not be confused with a total lack of jurisdiction which takes cognizance of the general meaning of the word 'jurisdiction' as "the authority which a court has to decide matters that are litigated before it, or take cognizance of matters presented in a formal way for its decision" (per Ayoola, JSC). His Lordship further held:

"Where competence is presumed, because there is nothing on the face of the proceedings which reveals jurisdictional incompetence of the court, it is for party, who alleges the courts incompetence to raise the issue either in his statement of defence in the proceedings, commenced by writ, or by affidavit, in cases commenced by originating summons. A judgment given in proceedings which appear ex-facie regular is valid"

 

The law, however, is that parties cannot, by consent confer jurisdiction on a court, where it has none. But where it has, as per the subject matter in litigation, pursuant to the case of the Plaintiff, "the court, cannot by the precipitated action of the defendant, lose that jurisdiction, simply because the defendant wants it so. After all, it is settled law that, it is the Plaintiff's claim in a matter that determines the jurisdiction of the court." See ADEPOJU v. INEC (2012) 21 WRN 38 holding 2; Akinpolarin v. Akinnola (1994) 3 NWLR (Pt. 335) 659.

 

The Respondent had pleaded in paragraph 5 of their pleading that, "Sometime in 1997, the chairman and Managing Director of the 1st Defendant approached the Plaintiff in Kaduna... "In paragraph 12, the Plaintiff also alleged, "The Plaintiff through its Bankers in Kaduna and by means of drafts advanced the friendly loan to the Defendants."

 

These averments were duly admitted by the Appellant in paragraph 2, when it said "Defendants admit paragraph 5 but add that the request was for a N21.75m, friendly loan and interest free loan". Appellant was completely silent on paragraph 12 and that amounts to admission of same. No wonder the Appellant did not raise any issue about territorial jurisdiction at the trial court, but rather filed a counter-claim, seeking a declaration that the Defendants were not indebted to the Plaintiff and an order for the Plaintiff, to return the title deeds of the 1st Defendant's warehouses in Calabar and Ogoja, and for N5m as general damages for breach of contract.

 

I think the issue one therefore, came as an after - thought, and the Appellant lacked the vires to raise it in this court (even under the guise of jurisdiction), as the same was never raised at the court below, and no leave was sought by Appellant to raise it, as a fresh issue. See Ikedigwe v. Fai (2012) 10 NWLR (Pt. 1308) 375; Udo v. RTBC and S (2013) 14 NWLR (Pt. 1375) 488; University of Ilorin v. Olawepo (2012) 52 WRN 42

 

See also the case of Rivers State Govt. v. Specialist Konsult 2005 MJSC 19 AT 43 (OR (2005 LPELR-2950(SC), where the supreme court held:


"In actions based on contract, jurisdiction depends generally on one of the following:

(a)     Where the contract was made;

 

(b)     Where the contract ought to have been performed; or

 

(c)     Where the defendant or one of the defendants resides


There is also another settled procedure and it is this: The venue for the trial of a suit based on a breach of contract could also be determined by:

 

(a)     Where the contract ought to have been performed; or

 

(b)     Where the defendant resides; or

 

(c)     Where the defendant carries on business."

 

Per Niki Tobi.

 

It is obvious that the Plaintiff pleaded that the loan transaction was made in Kaduna and paid by Plaintiffs banker (through bank draft) in Kaduna. I believe the repayment of the loan was also expected in Kaduna, though the Defendants resided in Uyo, Akwa Ibom State, and carried on their businesses there.
The trial court therefore had jurisdiction to hear the case, and I resolve issue one against the Appellant.

 

On Issue 2, the Respondent submitted that Appellant was not denied fair hearing as the Records of appeal shows that both the Appellant and its counsel were in court on 12/3/03, and Appellant was represented by one Akpan E. Essien while Eta Eta Esq.; was its Counsel, and the case was adjourned, in their presence, to 6/5/03 for defence and address; that on the said 6/5/03 Appellant, who was fully aware of the case coming up on that date was absent, though Appellant's Counsel called to say he was bereaved and requested for adjournment, and he was obliged and the case further adjourned to 9/6/03 for defence and address.
Counsel said the question to ask was whether Appellant had knowledge of the 9/6/03 date, for the defence and address. He answered in the affirmative and said that the mode of communication of the notice was not of essence and relied on the case of AKIN FOLORUNSO v. SHALOUB (1994) 3 NWLR (Pt. 333) 413 AT 430, where it was held that;



"A hearing notice is defined as a process of the court by which a party to the proceedings is notified of the date the case has been fixed in court, where he is not otherwise aware of such a 'date.' He also relied on Murli Nirdiandani Tiptop Industries Ltd v. Babatunde Pinheiro (2001) FWLR 1307 which also placed reliance on Akin Folonuso v. Shaloub (supra). He also relied on Blacks Law Dictionary on the meaning of "Notify"

Counsel submitted that by the authorities above, the communication of the adjournment date made by the court registrar through telephone was as good as a written hearing notice, especially as the adjournment was also sought by telephone; that Appellant's Counsel had knowledge of the hearing date of 9/6/03 and so the trial court was entitled to proceed with the case. Counsel further said that affidavit of service or certificate of service is not the only or exclusive means of the court satisfying itself that there is proof of service, or that a party has knowledge of hearing date. He relied on A.G. Anambra State v. Okeke (2012) 5 SC NK 318 at 329, and said that in our present age and time when technology has become so advanced and means of communication has improved progressively, communication by telephone is as good as a written communication.

I think this issue, is the key to the success or otherwise of this appeal, as the crucial question is whether the learned trial judge was right to enter the three important decisions he made on 9/6/03, when the Appellant and its Counsel were not in court. When the trial Court was told by the 1st Respondent's Counsel that Appellant and its Counsel were not in court for the business of the day, which was to cross examine PW2, defend the case and possibly take address, the court entertained the Plaintiff's applications and granted the three:

(1)     Discharged the PW2 (from cross examination)

 

(2)     Closed the case of the Defendants, that is denied them opportunity to defend the case, and

 

(3)     Allowed the Plaintiff's Counsel to address the court. See pages 246 to 251 of the Records.

 

Considering the normal procedure and processes usually followed in the course of due trial, I think taking those three major applications and granting them in one fell swoop smacked of great haste, capable of much damage to the hallowed principles of proper and fair hearing of all the parties in the suit. Just as the Plaintiff is entitled to adequate time to prepare and lead evidence to prove his case, the Defendant is also entitled to equal and/or sufficient time to produce and lead evidence to defend his position in the case, and, certainly, under normal situation, that cannot be accomplished in one day, as the learned trial court appeared to have made up its mind to force the Appellant to do in this case.

On 12/3/03, the court had adjourned the case to 5/6/03 for cross examination of PW2, defence and possibly, address, and had ordered the PW2, recalled for that purpose. On that date, 5/6/03, the parties were absent and 1st Respondent's Counsel, understandably, was not happy, but he prayed for adjournment, saying that the Registrar of the Court had informed him that the Appellant's Counsel was bereaved. The Court adjourned the case, with an order that the Defendants be served (with the new date). See (page 246 of the Records).

It can be appreciated that when on the return date, 9/6/03, the Defendants and their Counsel were still not in court, the Respondent's (Plaintiff) Counsel and even the court were disappointed and displeased, thereafter sentiment/emotion appeared to be allowed to dictate the course of events.

 

1st Respondent's Counsel made his emotional address, reminding the court of the many challenges the case earlier had and at a point default judgment had to be entered and later vacated, because of the way the defendants handled the case; that there must be an end to litigation, the case having commenced in 1999! He then urged the court to discharge the PW2, since the Defendants were not there to cross-examine him and the defence should be closed.

Every court should be wary of such emotive address as it is usually a cover for and a lure to judicial errors and absurdities, when a court acts on the spur of the moment or with emotive force to appease Counsel or vents its anger at the disappointing conduct of the defaulting party (who, unfortunately may not even be there to defend himself or action)!

 

What the learned trial court should have done, at that juncture, would have been to find out whether the Notice it ordered to be served on the Defendants on 5/6/03 had been served, and if done, verify the proof thereof.
The Registrar of the court (that is clerk of court) appeared to have further contributed to misleading the court, when he said:

 

"As at the last adjournment after the adjournment counsel to defendant from Akwa Ibom (sic) to confirm whether his matter was heard and adjourned because he told me he was bereaved. I confirmed that the matter was adjourned to 9/6/03 at 11.00 am for defence or address."

Of course that was not a proof of compliance with the order that "Defendants be served," neither was it the needed proof of service. Meanwhile, on 15/1/03 the Plaintiff had obtained order (ex-parte) to serve the Defendants with the notice(s) of hearing by substituted means that is, by DHL Courier Service and that should have been the expected way of proving the service of the notice of service on the Appellants!

 

We have stated, several times that the best way to establish service of process of court, is by recourse or reference to the affidavit of service filed by the bailiff of court, or certificate of service, filed by the service/courier authority. See the case of Afribank Nig. Plc v. Yelwa (2011) 12 NWLR (Pt. 1261) 287 ratios 1 and 2; Zaria Local Govt. Council v. Kwastan CA/K/151/09, an unreported decision of this court, delivered on 17/1/2014.


It is a well known fact, now acknowledged by our jurisprudence, that information technology has evolutionalized the world and service of processes, including text messages, letters and documents can be done by the speed of light, electronically. But that can only be taken advantage of by the various rules of court, relating to service of processes of court. I am aware that some jurisdictions, have since reviewed their rules in this direction, just as the Evidence Act 2011 and the Practice Direction of this court appear to have made provisions for internet process and service by telephone. Certainly, that was, not the case with Kaduna State High Court (Civil Procedure) Rules 1987, upon which the hearing of the Respondent's case, at the court below, was based. Service of court process by means of telephone was not in vogue, then, and if at all, was used privately, by mutual consent.

 

I had earlier stated that the trial court took too many important decisions on the same date (9/6/03) he discharged the PW2 from cross examination. Even if it was very material for the court to waive the requirement of proper service of the Appellant with the notice of hearing on 9/6/03 and thereby discharge the PW2 (whom there was no evidence he was in court) to punish the Defendants for their dereliction, there was no imminent reason to close the case of the Defendants at the same time and proceed to take address from the Plaintiff. The case should have been adjourned for the Defendants to open their defence, and hearing notice should have been served on them, to come to court for that purpose.

Appellant had a right to be heard.

 

In the case of CEEKAY Traders Ltd v. General Motors Co. Ltd (1992) 2 NWLR (Pt. 222) 132 at 148, the Supreme Court said:

 

"In this case it is clear on the Record that the Appellant's Counsel was never called upon by the learned trial judge to proceed with his case after the refusal of his application for adjournment, and in my view, failure to do so on the part of the trial court has occasioned a miscarriage of justice... it is not enough to assume that in the circumstances of a particular case, even if Counsel was called upon to proceed, he would not be in a position to do so ... It is only right and proper that before a party's claim in a court is dismissed, the party should be given opportunity of being heard..."

 

In the case of Alh. Muhammed Alikeo Mohammed v. Adebodun Sheriff Kazeen & Anor: CA/K/317/2010, an unreported decision of this court delivered on 14/2/14, where the learned trial judge refused to adjourn a case to enable the party produce original copies of a document, (which photo copies were rejected by the court), and rather queried: "what purpose will adjournment serve at this stage?" this court held that:

"That was clear and undisguised demonstration of bias against the Appellant."

 

See also Guaranty Trust Bank Plc v. Fadco Industries (Nig) Ltd (2013) LPELR-21411(CA).

I think the situation in this case, raised more concern, in that the Defendants and their Counsel were not even in court to hear and contest the issues raised against them, which led to the three decisions of the trial court, taken in quick succession, against them, having not been put on notice of the case coming up on that date! As earlier stated, if the trial court had any strong reason to accede to the application to discharge the PW2, believing that the Defendants were served with notice of hearing and they failed to come to cross examine the PW2, the Plaintiffs, on being granted the application to discharge the PW2, ought to have applied to close their case and the matter adjourned for defence, and hearing notice issued to the Defendants. Therefore the haste and speed with which the learned trial court proceeded to close the defence's case, and took address from the Plaintiff (which should have started with the Defendants) on the same date and at the same time of hearing, left much to be desired and was capable of implying that the court was on a mission to deny the Defendants a chance to be heard.

 

I think that breached the cardinal rule of adjudication, which requires the other party to also be heard, or all sides to be heard, fairly. See Section 36(1) of the 1999 Constitution, as amended and the case of Oyekanmi v. NEPA (2000) LPELR-2873(SC); General Electric Co. v. Akande (2012) ALL FWLR (Pt. 637) 1474; Amadi v. INEC (2012) ALL FWLR (Pt. 627) 1415; Military Gov, of Lagos State v. Adeyiga (2012) ALL FWLR (Pt. 616) 396.

 

I resolve this issue in favour of the Appellant.

 

On the issue 3, where the learned trial court pronounced interest of 8% to be paid on the original loan of N21,750,000.00, from 6th April, 1998 until the date it was fully paid, after refusing to grant the special and general damages claimed, I think this was a grave error by the learned trial judge. To start with, the original loan of N21,750,000.00 was no longer an issue before the court, the said loan having been liquidated by the Appellant, N17,000,000 before the suit and N4.75m, after it was filed (See, paragraphs 2-3 and 2-5 of the Respondent's brief). It was clear that the remaining case before the lower court (as per the writ of summons and statement of claim as well as statement of Defence/counter claim) were as follows:

 

By the Plaintiff:

 

"whereupon the Plaintiff claims against the defendants jointly and severally, the sum of N8,084,193.00 as special land general damages for breach of contract and 8% interest from the 31st day of December, 1998 up to the date of judgment, and thereafter at rate of 10% until judgment sum is fully liquidated"

 

(Page 22 of the Records)

 

By the Defendants:

 

"where upon the Defendants claim –

 

(i)      A declaration that the Defendants are not indebted at all to the Plaintiff

(ii)     An order for the Plaintiff to return the title deeds to the 1st Defendants warehouses located at Calabar and Ogoja...

 

(iii)    N5m (Five Million naira) being general damages for breach of contract." (page 80 of the Records )

 

The trial court had held that the special and general damages claimed by the Plaintiff had not been established. (See page 258 of the Records) It also held that "From the nature of the agreement between the parties ... (it) was a friendly loan..." See page 259 of the Records. But, strangely, after holding that the special and general damages by Plaintiff were not established and that the original loan agreement (N21,750,000.00) was a friendly loan, the learned trial judge somersaulted and pronounced the payment of 8% interest on the original loan to the 1st Respondent from 6th April, 1998 (1st Respondent had asked from 31st December, 1998) till date it fully paid the same. (page 259 of the Records).

Of course, from the claim of the Respondent, if any interest of 8% (or at all) existed in the case, it could only have been tied to the claim of N8,084,193.00, raised by 1st the Respondent and the same can only be calculated on that claim, on the same being granted by the court. By ordering that the said claim of N8,084,193.00 was not established by the Respondent, that, of course, marked the terminal of the case and the order to make should have been that of dismissal of the case.

 

The trial court was therefore making a case, different from that of the Plaintiff's, when it made order for the payment of 8% interest on the original loan, based or, what the court called, oral agreement reached subsequently between the parties. The law is that the trial court lacks the vires to make such order and to make a case for any party before it, different from what the party claimed Aboyeji v. Lateju (2012) ALL FWLR (Pt. 648) 961; Ayoade v. Spring Bank PLC (2014) 4 NWLR (Pt. 1396) 93.

 

There could be no way of determining the alleged interest of 8% from the original loan of N21,750.000.00 from 6th April 1998, since the same had been paid by installments and no dates were led to establish the times of the instalmental payments, and what was due after each installment.
Also by law, a written contract agreement cannot be varied, explained or defeated by a purported oral agreement of the same parties (or of a 3rd party) over the written agreement. There was evidence that the contract agreement (Exhibit 1) was a friendly loan, free of interest. A friendly loan, as the name implies, is a loan from a friend to a friend, which makes no room for usury or interest or penalty. It connotes a lifeline thrown by a friend to a friend, to bail him out of trouble and does not contemplate profiting from the gesture, financially.


I looked at the Black Law Dictionary and other English dictionaries for the meaning of "friendly loan" I did not see in the ones I consulted. But I saw the meaning of the adjective "friendly" to mean - "kind; behaving as a friend, relating to, or typical of a friend, being a colleague, helper partner etc"
In the sense of that word a "friendly loan" therefore does not admit of interest, or anything that detracts from kindness, friendship, help and partnership, which charging of interest or usury is likely to cause. See First Bank of Nigeria v. I.A.S. Cargo Airlines Nig. Ltd (2011) LPELR-9827(CA) where Salawa, JCA held:


"However, where the Plaintiff happens to be a private person, or the loan is stated to be a "friendly loan" and no interest charge is fixed at the time of entering into the loan agreement, the court is precluded from awarding interest in such circumstances." See UBN v. SAX Nig Ltd (1994) 8 NWLR (Pt. 361) 150; UBN v. OZIYI (1994) 3 NWLR (Pt. 363) 385; Hausa v. First Bank of Nigeria Plc CA/J/295/981 unreported decision of this court delivered on 12/4/2000; UBN v. SALAMI (1998) 3 NWLR (Pt. 538)


See also IDAKULA v. RICHARD (2001) FWLR (Pt. 693) 111 where AKPABIO, J.C.A. (of blessed memory) said:


"... The court will readily award a pre-judgment interest, where the plaintiff is a Commercial Bank, and the rate of interest fixed at the inception of the loan or over draft transaction; whereas, if the plaintiff was a private person; or the loan stated to be a "friendly loan" and nothing said about interest charges at the time of entering into the loan agreement, the court will not award interest in such circumstances
."


I therefore resolve the 3rd Issue, in favour of the Appellant also, and, on the whole, hold that the appeal is meritorious and is allowed, in part.
The aspect of the judgment of the lower court awarding 8% interest against the Appellant on the original loan of N21,750,000.00 from 6th April, 1998 until the date it fully paid same, is hereby set aside.

 

Because of the haste with which the Learned Trial court handled the case, it forgot or failed to say anything about thee Appellants' Counter-Claim in its judgment of 13/6/2003. Appellant did not, however appeal against this error and so raised no issue on it. We cannot therefore make any pronouncement on that other than that the appeal is allowed. Parties shall bear their respective costs.


ABDU ABOKI, J.C.A.:

 

I have had the privilege of reading in advance the draft judgment of my learned brother, ITA G. MBABA, J.C.A., and I entirely agree with the reasoning and conclusion reached therein. I abide by the consequential orders as to costs made in the lead judgment.



HABEEB ADEWALE OLUMUYIWA ABIRU, J.C.A.:

 

I have had the privilege of reading before now the lead judgment delivered by my learned brother, Ita Mbaba, JCA. His Lordship has ably considered and resolved the issues in contention in this appeal. I agree with the reasoning and abide the conclusions reached therein. I have nothing more to add.

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