Afro Continental (Nig.). Ltd & Anor. V. Co-op. Association Of Prof. Inc (2003)

LAWGLOBAL HUB Lead Judgment Report

MOHAMMED, J.S.C.

This is an appeal from the judgment of the Port- Harcourt Division of the Court of Appeal. In the judgment the Court of Appeal upheld the decision of Owerri High Court, Imo State, in which it granted the claim of the respondent for the sum of $1,706,000.00 (U.S. Dollars) with interest at 13% against the appellants. The High Court further awarded 10% interest per annum until the judgment sum shall have been settled.

The 1st appellant is a Nigerian company based in Lagos and the 2nd appellant is an American company operating from New York. The respondent who was the plaintiff at the High Court is an American company based in Michigan. Another company which was involved in this matter is Co-operative Associations of Professionals Limited. It operates in Nassau Bahamas. One attorney, by name William A. House, is a director of both the American and Bahamian companies. It was this William A. House who gave Prince Ben Akabueze power of Attorney to institute the present action at Owerri High Court, Imo State.

This dispute arose over a contract awarded to the respondent by the Nigerian Presidential Task Force for the supply of 10,000 metric tons of American long grain rice at $790. U.S. Dollars per metric ton. Following an agreement between the appellants and the respondent the contract was sub-contracted to the appellants on an agreed price of $550. U.S. Dollars per metric ton. Pursuant to the agreement the respondent in June, 1982, issued to the appellants a letter of credit for the sum of $7,356,000.00. U.S. Dollars. Out of this amount the appellants were to deduct $1,856,000.00. U.S. Dollars. This would be their share of the transaction. It was agreed that this amount should be paid to Prince Ben Akabueze. In compliance with the agreement the appellants supplied the metric tons of rice. They however failed to pay Prince Ben Akabueze the respondent’s attorney the $1,856,000.00 U.S Dollars which was earlier agreed to be paid to him. Following several demands the appellants paid Ben Akabueze $150,000.00. U.S. Dollars, leaving a balance of $1,706,000.00. U.S. Dollars still to be paid. The respondent instituted this action to recover the outstanding balance yet to be paid by the appellants. The respondent’s claim against the appellants jointly and severally is for the following; as general and special damages.

“(i) The equivalent $1,856,000.00 less $150 ,000.00 being value of N100,000.00 paid to the plaintiffs… $1,706,000.00

(ii) Aggravated general damages… 200 ,000.00

$1,906,000.00

(iii) Interest at 13% up to date of judgment and thereafter 13% until payment is made.”

The respondent brought this suit under the undefended list. The particulars of claim and affidavit in support of the action were filed. The case was assigned to the learned Ogu Ugoagwu, J. of Imo High Court sitting at Owerri. The appellants entered unconditional appearance. Immediately afterwards many applications were filed by the appellants. Some were challenging the jurisdiction of the court and in some applications the appellants requested for transfer of the suit from Ugoagwu, J. to another Judge.

Looking at the issues identified by the appellants it is clear that the appellants, without saying so, are alleging bias on the part of the learned trial Judge. It is pertinent therefore to give a brief narration of the proceedings before the learned trial Judge delivered his judgment in favour of the respondent. Learned counsel for the respondent, Mr. Dike, in the respondent’s brief correctly narrated the facts of the proceedings from the beginning of the trial to the 13th of December, 1989. I will reproduce that narration for the clear understanding of what transpired before the learned Judge Ogu Ugoagwu, J. delivered his judgment. The proceedings were given in the following narrative.

“Two earlier suits were filed by the respondent before the one leading to this appeal.

(a) Suit No. HOW/242/87

Dated and filed on 31st August, 1987, this suit was commenced by the issue of an ordinary writ of summons and was brought before Ogu Ugoagwu, J.

Appellants raised a preliminary objection filed on 11th November, 1987 praying that the suit be struck out for lack of jurisdiction of the court and that leave was not obtained to serve the appellants out of jurisdiction. In a reserved ruling dated 14/1/88, the motion was dismissed with N100.00 costs to the respondent. Appellants appealed but the respondent discontinued the substantive action. That action died without hearing the merit of the case.

(b) Suit No. HOW/163/88

Dated and filed on 4/5/88, this suit was commenced by the issue of a writ of summons after the discontinuance of the first. It was placed on the undefended list and again brought before Ogu Ugoagwu, J.

The appellants filed a motion on notice objecting to the jurisdiction of the court. Before the motion could be heard, learned Senior Advocate applied to the Chief Judge, vide a letter dated 8/7/88, that the case be transferred to another Judge because Ugoagwu, J., had earlier in the first case ruled against the appellants. Ukattah, J. before whom the matter was transferred, declined jurisdiction and accordingly struck out this second suit on the ground that the writ of summons was void having been issued without prior leave of court. Again the action was decided not on the merits.

(c) Suit No. HOW/261/89

As the respondent was entitled to do, the commenced the third suit. It was on the undefended list and came before Ugoagwu, J. By 13/12/89 when the matter came up, the following 3 applications were before the court.

(i) Appellants’ motion dated 13/10/89 challenging the court’s jurisdiction;

(ii) Respondent’s motion dated 20/10/89 for the suit to be heard as an undefended suit and for judgment; and

(iii) Appellants’ motion dated 12/12/89 for, inter alia, the transfer of the suit to another Judge.”

On the 13th December, 1989 the three applications were brought before Ogu Ugoagwu, J. for hearing. Mr. Kuku was the learned counsel representing the appellants. Mr. Kuku asked for adjournment to file further documents in support of the motion seeking for transfer of the suit to another Judge. Mr. Dike opposed the application and in a considered ruling the learned trial Judge refused the application for transfer. Mr. Kuku orally applied for stay of the ruling. Mr. Dike opposed the application. The learned Judge refused to grant a stay. Mr. Kuku thereafter asked for adjournment on the ground that he had filed a new motion supplanting the application dated 13/10/89. The new motion was filed on 12/12/89. Mr. Dike, in response, said that he had not been served with the new motion. The court also noted that the motion in question was not in its file. According to Mr. Adesanya, SAN, the learned trial judge asked for evidence of filing the new motion and he was given a copy of the motion and the receipt for its filing. Mr. Ogu Ugoagwu, J., was not impressed and ordered the proceedings to continue.

The learned Judge called upon Mr. Kuku to move the motion dated 13/10/89 challenging the jurisdiction of the court. Mr. Kuku replied, “I am sorry I am not in a position to go on with the motion.”

Mr. Dike then urged the court to strike out the motion since Mr. Kuku was not ready to go on with the motion. The learned trial Judge ruled as follows:

“Mr. Kuku has refused to go on and argue the motion filed by the defendants/applicants on 13/10/89 attacking the jurisdiction of the court on the ground of two previous rulings by the court in this suit today. Since counsel does not want to go on with the motion when called upon by the court to do so after two rulings on the matter, the motion filed on 13/10/89 is hereby dismissed for non-prosecution with N100.00 costs to the plaintiff/respondent.”

Thereafter the learned trial Judge proceeded to enter judgment for the respondent on the undefended list. He concluded his short ruling as follows:

“This suit was instituted on 5/9/89.

In compliance with Order 23 rule 4 of the High Court (Civil Procedure) Rules, 1988, I do not call upon the plaintiff “to summon witnesses to prove his case formally”. In the absence of defence as required by the rules I hereby give judgment to the plaintiff as follows:

(i) $1,706,000.00 U.S. Dollars being balance of money due and payable to the plaintiff’s Attorney Prince Ben Akabueze as contained in paragraphs 14, 15 and 18(1) of the particulars of claim.

(ii) Interest on the said sum at the rate of 13% from 5/9/89 to today 13/12/89.”

(iii) Interest on (1) and (11) together at the rate of 10% per annum in accordance with Order 40 rule 7 of the High Court (Civil Procedure) Rules, 1988 until the judgment debt is satisfied. Claim for aggravated damaged dismissed.”

Dissatisfied with the judgment of the High Court the appellants filed an appeal to the Court of Appeal.

The Court of Appeal, in a considered judgment dismissed the appeal. It is against that decision that the appellants have finally come to this court. Learned counsel for the appellants identified 10 issues for the determination of this appeal. Mr. Dike, learned counsel for the respondent, formulated 5 issues from 13 grounds of appeal filed by the appellants’ counsel for the prosecution of this appeal. I do not intend to reproduce those issues because one issue which concerns the failure of the learned trial Judge to hear a motion filed on 12112/89 may determine this appeal. Before I consider the issue concerning the motion filed on 12/12/89 I am not unmindful of what appears to be a preliminary objection raised in the respondent’s brief on the validity of all the grounds of appeal (13 grounds) filed by the appellant. When this appeal was about to be heard on 16th October, 2002, learned counsel for the respondent withdrew the preliminary objection in the respondent’s brief and it was struck out. This court adjourned the hearing of this appeal on the application of one of the counsel.

The only issue I want to consider from the issues identified is whether the motion on notice claimed by the appellants to have been filed and the filing fees paid at the open registry on 12/12/89 was part of the records of the court and whether failure to hear the application in the said motion which concerns a challenge to the jurisdiction of the court amounted to denial of fair hearing within section 33(1) of the 1979 Constitution. I have looked at pages 136 to 137 of the record of this appeal where Mr. Adesanya, SAN said that the motion had been copied. It is indeed correct that the motion was copied in the record of this appeal and it is also correct that the motion had been filed in the registry on 12/12/89. All the fees paid for the filing of the motion and the receipts given have been recorded. It is without any doubt that the learned trial Judge was aware of this motion. I have no reason to doubt the allegation made by appellants’ counsel that a copy of the receipt was shown to the learned trial Judge in court. The relevant motion in question is reproduced as follows:

“MOTION ON NOTICE

BROUGHT UNDER S. 99, SHERIFFS AND CIVIL PROCESS ACT, CAP. 189, 1958; ORDER 5 RULES 2, AND 10(A) & (B) OF THE IMO STATE HIGH COURT (CIVIL PROCEDURE) RULES 1988, S.22(1), 22(2) HIGH COURT LAW, CAP 61, LAWS OF EASTERN NIGERIA 1963 APPLICABLE IN IMO STATE AND UNDER THE INHERENT JURISDICTION OF THIS HONOURABLE COURT.

TAKE NOTICE that this Honourable Court will be moved on the …………… day………… of 1989 at the hour of 9.00 O’clock in the forenoon or so soon thereafter as counsel for the defendants /applicants can be heard for:

(i) An order that the plaintiffs case be struck out because this Honourable Court lacks jurisdiction to entertain the plaintiff’s claim.

(ii) An order setting aside the order of this Honourable Court dated 25th August, 1989 which order granted the plaintiff/respondent leave to issue the writ of summons for service on the defendants/applicants out of the jurisdiction of this court.

(iii) An order setting aside the leave granted pursuant to the order referred to in (ii) supra.

(iv) An order setting aside the writ of summons endorsed for service on the 1st and 2nd defendants/applicants respectively.

(v) An order setting aside the purported issue and service of the writ of summons on the each of the defendants.

(vi) For such further or other order or orders as this Honourable Court may deem fit to make in the circumstances.”

It is settled law and mandatory that a court must make a decision and pronounce on every application which is before it and failure to do so is a breach of fair hearing. See also the case of Okeke Oba v. Okoye (1994) 8 NWLR (Pt. 364) 605. The motion which the learned trial Judge refused to hear has questioned his court’s competency to hear the matter before him. When an objection to jurisdiction is raised it ought to be resolved first. Nwosu v. Imo State Environmental Sanitation Authority (1990) 2 NWLR (Pt. 135) 688. The refusal of the judge to fix a date for the hearing of the application or to decline to hear an application duly filed in the registry amounts to a deliberate refusal to hear the application. It is therefore a breach of fundamental right to fair hearing as enshrined in the Constitution. All proceedings which followed such a breach will be a nullity. The ruling delivered by Ugoagwu, J, in which he granted the claim of the respondent after refusing to hear the motion is therefore a nullity.

I therefore agree with the submission of learned counsel for the appellants that, the failure of the learned trial Judge to determine the motion filed by the appellants challenging the jurisdiction of his court is a fundamental breach. It has rendered the ruling which he subsequently delivered in favour of the respondent a nullity. The Court of Appeal was in error to affirm the said decision. This appeal is therefore allowed. The ruling of the High Court Land the judgment of the Court of Appeal are both set aside. The case is remitted back to the High of Imo State for the determination before another Judge. The appellants are entitled to the costs of this appeal which I assess at N10,000.00 in this court and N1,500 at the Court of Appeal.

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SC.77/1995