A. I. C. Limited V. Nigerian National Petroleum Corporation (2005)
LAWGLOBAL HUB Lead Judgment Report
EDOZIE, J.S.C.
In 1980, the appellant, a Nigerian Company entered into an agreement with a German Company (Mannesmann – Anlagebau A. G.). Under the terms of the agreement, exh. “B” (hereinafter referred to as ‘Commission Contract’) the appellant was to facilitate or assist in the award of construction projects which the German Company (hereinafter referred to as Mannesmann) was bidding for with the respondent. In consideration of the undertaking, the appellant was to be paid a commission of 5% of the contract sum in respect of any contract awarded to Mannesmann by the respondent. The 5% commission was to be calculated on the basis of the amount of the contract sum transferred to a German bank and credited to Mannesmann excluding freight, packing costs and customs.
Sometime in 1984, the respondent awarded to Mannesmann the Escravos – Lagos Pipelines and Compressor Station Project (hereinafter referred to as the ‘Project Contract’). According to the appellant, when Mannesmann started receiving install mental payments due, it failed to pay to the appellant its commission in respect thereof. In consequence, the appellant sued Mannesmann in a court in Germany in respect of the commission due on the amount of the install mental payments made.
The suit was dismissed but while an appeal in Germany was pending, the appellant, as plaintiff by a writ of summons in suit No.LD/264/88 filed on 12/2/88 commenced another action in the Lagos High Court, against Mannesmann and the respondent as pt and 2nd defendants respectively. In the said action apart from two other alternative reliefs, the claim against Mannesmann is:
‘5% of the various sums set out in the schedule to this writ, less the amount claimed by the plaintiff in suit No.390/224/84 now pending before the District Law Court No.9 in Dusseldorf (particulars of which are set out in the statement of claim) being the amount of commission payable to the plaintiff pursuant to an agreement entered into in Lagos and dated 14th March, 1990 for undertaking all necessary efforts in assisting the 1st defendant in securing the contract for (sic) the 2nd defendant Escravos – Lagos Pipeline and Compressor Station.’
The only claim against the respondent was an injunction, ‘restraining the 2nd defendant from paying over to the 1st respondent the amount being claimed in paragraph 1 hereof and an order that the amount be deducted from the contract sum and withheld by the 2nd defendant pending the determination of this action.’
On 22nd February, 1988 the Lagos High Court (coram Ayorinde J,) granted an ex parte order, to wit,
‘That the 2nd defendant (respondent herein) shall withhold pending the hearing of the motion on notice from payments due to the 1stdefendant on the project which is the subject-matter of this litigation an amount not exceeding the following in schedule ‘D’ namely, US$1,220,185.40 ‘a3547,185.00 DM 22,270,922.00 and N2,764,785.40 respectively being the value of commission due to the plaintiff in event of the court’s finding in its favour.’
The motion on notice was made returnable on 16th May, 1988. On this date, Mannesmann filed an application to strike out or dismiss the suit for lack of jurisdiction, res judicata etc. The application was heard and granted and the suit was on 23/3/89 dismissed as against both defendants.
Dissatisfied with the ruling the appellant appealed to the Court of Appeal, Lagos Division and while the appeal was pending, the appellant’s counsel by a letter dated 19/1/91 (exh. M) warned the respondent not to pay over the money to Mannesmann. Subsequently, the Court of Appeal in a unanimous judgment delivered on 14th December, 1993 (coram Sulu Gambari, J.C.A., Kalgo and Uwaifo, J.C.A (as they then were) allowed the appeal on the question of res judicata, being the only issue canvassed and considered. The case was subsequently re-tried by Segun, C.J, of the Lagos State High Court. Mannesmann did not participate at the re-trial nor did it file a statement of defence. The respondent filed a statement of defence and participated at the trial through its counsel although it led no evidence. In a considered judgment delivered on 25th January, 2000 the learned C. J. entered judgment in favour of the appellant against the respondent and Mannesmann jointly and severally for:
“1. $1,220,185.40 (US Dollars)
- ‘a3547,185.00 (Sterling)
- DM 22,270,922.00 (Dutch Marks)
- N2,764,785,40 (Naira)
- $750,999.00 being 5% commission on contract D.”
The trial court further granted an order of injunction against the respondent on the following terms:
“Again an injunction is granted against the 2nd defendant restraining them from paying over to the 1st defendant the amount claimed herein (sic) until the plaintiff is fully paid the 5% commission enumerated above.”
Against that judgment, the respondent lodged an appeal to the Court of Appeal, Lagos Division. In a bid to execute the judgment, the appellant commenced garnishee proceedings against the respondent and obtained a garnishee order of the respondent’s funds at CBN and DBA on 10/5/2000. In its judgment delivered on 24th May, 2001, the Court of Appeal held that as there was no privity of contract between the appellant and respondent with respect to the project contract, there was no basis for the judgment entered against the respondent jointly and severally with Mannesmann. It further held that since an order of injunction is an ancillary relief which is rarely granted on its own, the trial court was wrong to have granted the injunction against the respondent in respect of whom no allegations were made in the appellant’s pleadings. Since Mannesmann did not appeal against the judgment of the High Court, as it, affected it, that aspect of the judgment was left untouched by the Court of Appeal.
The appellant has lodged the instant appeal against the judgment of the court below particularly the portion reversing the order of injunction granted by the trial court restraining the respondent from paying over to Mannesmann the amount adjudged due from Mannesmann to the appellant as agreed commission. Pursuant to the hearing of the appeal, parties by their counsel filed and exchanged briefs of argument some of which were subsequently amended, the relevant briefs being, the appellant’s amended brief, the respondent’s amended brief and the appellant’s amended reply brief.
The respondent raised a preliminary objection against the hearing of the appeal and this was countered by another preliminary objection by the appellant against the respondent’s preliminary objection and briefs were ordered and filed in respect of these objections. I consider it appropriate to dispose of these objections before, if necessary, returning to the substantive appeal. The respondent’s preliminary objection is predicated on its motion on notice dated and filed on 21/5/2004 supported by an affidavit of 9 paragraphs to which were annexed exh. A, Band C. The prayer sought in the motion paper is for the dismissal of the substantive appeal on the ground that it arose from a suit founded upon a base cause tainted with illegality and contrary to public policy, in that the appellant pleaded in paragraphs 10, 11 and 12 of its statement of claim filed at the trial court and led evidence through PW1 and PW2 that it helped Mannesmann to vet documents to delete all references in those documents to apartheid South Africa, which references would have led to the automatic disqualification of Mannesmann for the award of the contract. In the respondent’s brief in support of the objection, the sole issue identified for determination is:
“Whether having regard to the facts disclosed in the pleadings and the evidence on record, the transaction which formed the basis of the appellant’s claim is one which this honourable court can lend its hand to enforce.”
In arguing this solitary issue, reference was made to paragraphs 10, 11, 12 and 13 of the appellant’s statement of claim and the evidence of PW1 and PW2 thereon. It was submitted that the totality of those averments and evidence reveals that the appellant helped Mannesmann to procure contract from the respondent an agency of Nigerian Government; that in the process of assisting Mannesmann it had to lie and deceive the Nigerian Government officials by concealing vital information which if such information had come to the knowledge of the relevant government officials, Mannesmann would not have been awarded the contract and that the appellant wanted payment for the ‘assistance’ it rendered to Mannesmann as agreed and consequently sued. It was further submitted that the courts will generally refuse to enforce a contract for the commission of a legal wrong; they will generally also adopt the same attitude to a contract whereby one party may claim a benefit from the commission of a crime or a tort or may claim to be indemnified against the consequences of such an act.
In support of the proposition that no court ought to enforce an illegal contract whether or not the illegality is pleaded, the following authorities were relied upon: Sodipo v. Leminkainen (1985) 2 NWLR (Pt.8) 547 at 557-558; Alao v. A.C.B (1998) 3 NWLR (Pt. 542) 339 at 355, Ekwunife v. Wayne (W.A.) Limited (1989) 5 NWLR (Pt. 122) 422 at 450. The respondent conceded that the issue of illegality was not pleaded and is being raised for the first time in this court but submitted that illegality is an overriding consideration which cannot be glossed over if not pleaded provided it is brought to the attention of the court: vide the case of Ogwuru v. Co-operative Bank (1994) 8 NWLR (Pt. 365) 685 at 302. On the foregoing premises, this court is urged to strike out or dismiss the appellant’s appeal as its claims are based on a base cause, are tainted with illegality and contrary to public policy.
In response to the respondent’s preliminary objection by way of motion on notice dated 21/5/2004, the appellant filed on 29/6/2004 a preliminary objection to the respondent’s said motion and a counter-affidavit to the affidavit in support of the respondent’s motion. Annexed to the counter-affidavit are four exhibits – exhibits AIC 1, AIC 2, AIC 3 and AIC 4. The appellant’s preliminary objection is to the effect that the respondent’s motion dated 21/5/2004 is misconceived and incompetent on eight grounds.
In the appellant’s brief in respect of its preliminary objection, two issues were formulated for determination, viz:
“1. Having regard to appellant/objector’s eight grounds of preliminary objection dated 21st June, 2004, is the respondent/applicant’s motion raising without leave and for the first time a fresh allegation that the case in the trial court revealed ex-facie illegality when no issue has arisen in respect thereof in the appeal jurisdictionally competent as a basis for striking out or dismissing the appeal herein
- Has respondent/applicant established any ex-facie illegality that will warrant the striking out or dismissal of the appeal”
In relation to the first issue, it was submitted that on the question of illegality unlike that of lack of jurisdiction of court, it cannot be raised in the manner the respondent has sought to raise it by motion. It was submitted that except in cases of ex-facie illegality, a party relying on illegality ought to raise it in its pleadings and in support of the proposition, the following cases were craved in aid: Galadima v. Tambai (2000) 11 NWLR (Pt. 677) 1 at 15; Onwucheka v. N.D.I.C. (2002) 5 NWLR (Pt. 760) 371; Savannah Bank of Nigeria Ltd. v. Pan Atlantic Shipping & Transport Agencies Ltd. (1987) 1 NWLR (Pt. 49) 212 at 259.
Learned counsel for the appellant reasoned that as the respondent was a total stranger to the ‘commission contract’ it was not competent to complain about illegality in respect of that contract. It was stressed that the relief sought by the respondent is prejudicial to the merit of the substantive appeal and therefore not tenable. In respect of the appellant’s second issue on the preliminary objection posing the question whether any ex-facie illegality had been established, it was submitted firstly, that no specific law or public policy was stated to have been contravened nor does the evidence on record bear out any violation of public policy; secondly, it is not clear whether the alleged illegality – violation of public policy, relates to the “commission contract’ or the ‘project contract’ and thirdly that the authorities cited by the respondent in respect to whether or not illegality should be pleaded are not apposite to the instant appeal.
The issue vigorously canvassed by both parties in this appeal is whether or not there is any particular method of raising a question of illegality in a case before a court could consider it and whether in the instant appeal, there is evidence to substantiate the allegation that any of the two, related contracts in this case is tainted with illegality or is contrary to public policy. On the hallowed principle encapsulated in the Latin maxim ex turpi causa non oritur actio (an action does not arise from a base cause), a court of law does not generally enforce a contract or transaction tainted with illegality or contrary to public policy. A contract may be ex facie illegal or the illegality may depend on a combination of facts. In the former case, the illegality need not be specifically raised in the pleadings but in the latter case the general rule is that it must be raised in the pleadings. This appears to be the outcome of the decision of this court in the case of Ekwunife v. Wayne (WA) Limited (1989) 5 NWLR (Pt. 122) at 456 to the following effect:
“…Where a contract is not ex facie illegal and the question of illegality depends on a number of facts probabilities or possibilities or contingencies – to be hammered out by evidence and forensic logic, the general rule is that illegality must be raised in the pleadings.”
This view is exemplified by a passage in another decision of this court in the case of Onwucheka v. N.D.I.C. (2002) 5 NWLR (Pt.760) 371 at 388, to wit:
“A defendant who relies upon the defence of illegality should state the facts on which he relies in his pleadings. The law is well put in Bullen and Leake and Jacob’s precedents of pleadings p. 1199 that:
‘where the defendant relies upon the defence of illegality, he should distinctly raise that defence by his pleading, and should state the facts or refer to facts already stated in the statement of claim, so as to show clearly what the illegality is; if a man ‘intended to charge illegality, he must state facts for the purpose of showing what the illegality is’: Bullivant v. A.-G. for Victoria (1901) A.C. 196 per Lord Davey at 204.’
The learned senior counsel for the respondent conceded that there was no allegation of illegality raised in the respondent’s statement of defence. He however relies on the averments in paragraphs 10, 11 and 12 of the statement of claim and the evidence of PW1 and PW2 to the effect that the appellant (Mannesmann) scrutinised documents used for bidding for the ‘project contract’ to ensure that all references to apartheid South Africa were deleted as such references would have been detrimental to the award of the contract. Curiously, these averments that the respondent is relying upon now were denied in paragraphs 2 and 3 of its statement of defence. At any rate the appellant’s pleadings and evidence in support did not show that at the material time it was a government policy to discriminate against foreign companies that had links with South Africa. As reported in the Guardian Newspaper on 24th February, 1987 edition, annexed as exh. AIC 2 to the appellant’s counter affidavit, there was a public policy announcement made by the A.G. of the Federation which was directed at foreign companies seeking government contract. That announcement was made in 1987 and was not retrospective as to affect the contracts the subject-matter of this case which were concluded long before the announcement. It is clear to me that the evidence on record fell far short of establishing that the contracts the subject matter of the appeal were illegal or contrary to public policy. As I also earlier noted, the respondent did not raise the issue of illegality in its pleadings nor was that issue canvassed and pronounced upon before the lower courts. It, therefore, becomes a fresh issue in this court. The position of the law on raising of fresh issue on appeal is quite clear. It is that no substantial point of law which has not been taken in the court below will be allowed to be raised for the first time before the Supreme Court except under special circumstances: Makanjuola v. Balogun (1989) 3 NWLR (Pt. 108) 192 at 206. For such a point of law to be entertained, it must be shown to be a substantial point of law substantive or adjectival and that no further evidence which could have been called in the court below if it was raised there could have affected the decision one way or the other: see on this, Stool of Abinabina v. Chief Koje Enyimadu (1953) 12 WACA 171; Shonekan v Smith (1964) 1 All NLR 168 p. 173; K. Apena v. Barclays Bank of (Nig.) Ltd. & Anor. (1977) 1 SC. 47; Niger Progress Ltd v. N.E.L. Corp. (1989) 3 NWLR (Pt.107) 68 at p. 100. Furthermore, to canvass such an issue, leave of court must be sought and obtained: see Obiako v. State (2002) 10 NWLR (Pt. 776) 612 at 616. These conditions have not been compiled with in this appeal.
Since the respondent has not, in a proper manner, raised the issue of illegality and there being no evidence to establish that the contracts the subject matter of this appeal were tainted with illegality or made contrary to public policy, I will uphold the appellant’s preliminary objection and overrule and dismiss the respondents preliminary objection contained in its application for dismissal of the appeal. Having disposed of the preliminary objections, I will now advert to the substantive appeal.
In the appellant’s brief of argument, the following three issues were distilled for determination:
“1. Whether the injunction sought and granted against the respondent was set aside by the Court of Appeal on a wrong view of the remedy of injunction and in disregard of the decision of the Supreme Court in Governor of Lagos State v. Ojukwu (1986) 1 NWLR (Pt. 18) 621 at 636 and the provision of section 14 of the High Court Law, Laws of Lagos State, 1984.
- Whether the exclusive appellate jurisdiction of the Supreme Court under section 233(1) of the 1999 Constitution was usurped and breached when the earlier and subsisting decision of the Court of Appeal in CA/L/262/89 (Coram: Sulu Gambari, Uwaifo and Kalgo J.C.A. (as they then were) upholding joinder of the respondent in this suits for the purpose of the injunction sought against it and ordered retrial on the merit was reviewed and reversed by the decision of a differently constituted Court of Appeal (coram Oguntade, (as he then was) Chukwumah-Eneh and Aderemi J.J.C.A) presently appealed against holding that the respondent “was joined without any basis” and was not in any way ‘impleaded’ on the basis of the same pleadings that the previous panel considered to hold in plaintiff’s favour.
- Whether their Lordships in the court below acted without jurisdiction (and thereby occasioned a miscarriage of justice) when they held that the pre-trial interim injunction granted against the respondent in this case was not restored by the decision of their learned brothers in the earlier appeal in the suit notwithstanding that the same was not challenged by the respondent either in the trial court or by way of an appeal.
On its part, the respondent formulated four issues, to wit:
“1. Whether the court below in its judgment in appeal No CA/L/78/2000 delivered on 24th May, 2001 overruled, reversed or reviewed its earlier decision in appeal No.CA/L/262/89 in its judgment dated 14th December 1993 (formulated from ground 1 of the amended notice of appeal).
- Whether the court below properly construed and applied section 14 of the High Court Law of Lagos State in the circumstance of this case (formulated from ground 2 of the amended notice of appeal).
- Whether the pronouncements of the court below as to the effect of its earlier decision dated 14th December, 1993 in appeal No CAfL/262/89 on the interim order made by Ayorinde J. (as he then was) is wrong or occasioned miscarriage of justice (formulated from ground 4 of the amended notice of appeal).
- Whether the court below predicated the incompetence of the injunction granted by the trial court on wrong principles (formulated from grounds 3, 5 and 6 of the amended notice of appeal).
As I consider the respondent’s issues adequately formulated with clarity and precision, I will adopt same in the consideration of this appeal while relating them to the relevant issues formulated by the appellant.
The respondent’s issue No.1 which relates to appellant’s issue No.2 is whether the court below overruled, reversed or reviewed its earlier decision in this case contained in its judgment dated 14th December, 1993. For a better appreciation and resolution of the issue, it is necessary to narrate, albeit briefly, the background facts relating thereto. On 23/3/89, Ayorinde J, (as he then was) gave a considered ruling of this case on the basis of a preliminary objection filed by Mannesmann against the competency of the suit on the ground that (a) the court lacked jurisdiction (b) res judicata and, (c) abuse of process of court. He upheld the objection and struck out the appellant’s claim hence the appeal to the lower court. The Court of Appeal in appeal No. CA/L/262/89 (coram: Sulu Gambari, J.C.A. Uwaifo, Kalgo J.J.C.A. (as they were then) in considering the appeal, stated at p. 183:
“The only issue postulated by the learned counsel for the appellant which I also accept as appropriate, and in the absence of any other suggestion by the respondents is sufficient to determine and dispose of the appeal. It reads:
‘Whether or not the trial Judge was right in applying doctrine of res judicata to bar the plaintiff from prosecuting the present claim in Nigeria’”
In resolving that issue and allowing the appeal, the Court of Appeal held, at p. 191 thus:
“In the result, I am of the firm view that the learned trial Judge was wrong to have held, as he did, that the plaintiff/appellant was precluded form bringing the suit against the 1st and 2nd defendants in Lagos, having prosecuted a suit against the 1stdefendant in Dusseldorf in Germany.”
Thus, it is quite clear, that the only issue decided and upon which the appeal was allowed was whether or not the doctrine of res judicata, was applicable. But in a passage in its judgment at p. 188 of the record, the court appeared to have made some observations on the joinder of the respondent herein, in the proceedings. It said:
“In the case before the trial court parties are not the same. A 2nd defendant was joined so as to secure the payment of the commission due from 1stdefendant to the plaintiff in a situation in which commission would become due as and when payment becomes payable. It might have also helped to secure the judgment debt being paid by the 1stdefendant who was not ordinarily resident in Nigeria if any money accruing to be paid to the 1st defendant was not paid by the 2nd defendant until the matter between the plaintiff and the 1stdefendant is determined and disposed of.”
By the above observation, the Court of Appeal appeared to have opined that the respondent, herein, was properly joined in the suit as 2nd defendant.
However, after the appeal was allowed a retrial was conducted before Segun, C. J. who entered judgment in favour of the appellant against Mannesmann and the respondent. On appeal by the latter, the matter went back to the Court of Appeal a second time in Appeal No.CA/L/78/2000 (coram Oguntade, J.C.A. [as he then was] Chukwuma-Eneh, Aderemi J.J.C.A). That court, identified 5 issues for determination. But it held at p. 292 thus:
“These issues in unison clearly raise one fundamental question of whether issues of any kind were joined as between the 2nd defendant/appellant and the plaintiff/respondent in the pleadings… that is the crux of the matter”.
By that statement, the court focused attention on the question as to whether the respondent was properly joined as 2nd defendant at the trial. In resolving the issue negatively and allowing the appeal in its judgment dated 24/5/2001, the court reasoned that the final
“Order of injunction from its terms was directed against the appellant (i.e the 2nd defendant/respondent); it was not made against the defendant thus giving credence to the assertion that the only reason appellant 2nd defendant/respondent was joined without any basis as
party to the suit is to bind it in terms of the amount claimed against the 1st defendant.”
Flowing from this decision, the appellant has now submitted that the Court of Appeal had reversed its earlier decision which it lacks jurisdiction to do. It was submitted that under section 233(1) of the Constitution of the Federal Republic of Nigeria, 1999, the jurisdiction to review or reverse decisions of the Court of Appeal rests in the Supreme Court to the exclusion of all other courts. On the authority of the case of Cardos v. Daniel (1986) 2 NWLR (Pt.20) 1, it was submitted that once an issue has been raised and distinctly decided between parties, as a general rule, neither party can be allowed to fight the issue all over again whether in the same or subsequent proceedings.
In considering whether the Court of Appeal in its later decision, reviewed or reversed its earlier decision, a distinction has to be drawn between a ratio decidendi and obiter dictum of a case. The ratio decidendi of a case represents the reasoning or principle or ground upon which a case is decided. Obiter simply means in passing, incidental, cursory. Obiter dicta reflect, inter alia, the opinions of the Judge, which do not embody the resolution of the court. The expression of Judge in a judgment must be taken with reference to the facts of the case which he is deciding, the issues calling for decision and answers to those issues. These are what should be looked for in any judgment. The manner in which the Judge chooses to argue the case is not all important thing. Rather it is the principle he is deciding: see U.T.C (Nig.) Ltd v. Pamotei (1989) 2 NWLR (Pt.103) 244.
In the case of Afro-Continental Nigeria Ltd v. Joseph Ayantuyi & Ors (1995) 9 NWLR (Pt. 420) 411 at 439 this court, per Iguh, J.S.C. decided thus:
“It is indisputable that in the judgment of a court, the legal principle formulated by that court which is necessary in the determination of the issues raised in the case, that is to say the binding part of the decision is its ratio decidendi as against the remaining parts of the judgment which merely constitute obiter-dicta, that is to say, what is not necessary for the decision.”
See also American International Insurance Co. v. Ceckay Traders Ltd (1981) ANLR 50 at 80.
In this appeal, it has been pointed out that the sole issue identified by the Court of Appeal for determination in its earlier decision in appeal No. CA/L/262/89 was whether the appellant’s suit was barred by the doctrine of res judicata. It decided that issue negatively and allowed the appeal. The ratio decidendi of that case which is, therefore, binding is based on res judicata. The other remarks the court proceeded to make about joinder which was not necessary for the determination of the issue of res judicata was merely obiter dictum which is not binding. When, therefore, joinder of the respondent became a direct issue for resolution in its later judgment, the Court of Appeal was entitled to make a pronouncement therein as there was no binding decision on the issue in its earlier decision. The case of Cardoso v. Daniel (supra), relied upon by the appellant is not apposite to the case in hand. In that case, the issue, of res judicata was specifically raised and decided in the previous proceedings before Ademola, J who upheld the plea but on appeal, this court reversed the decision and sent the case back for retrial. The defendants again raised the issue contending that this court did not specifically decide the issue but this was rejected. In the instant appeal, the issue of the propriety of joining the respondent as 2nd defendant was neither specifically raised by the proceedings before Ayorinde J or in Appeal No. CA/L/262/89 nor was it specifically decided in those proceedings. It is, therefore, my view that the court below did not review or reverse its earlier decision in Appeal No.CA/L/262/89. This issue is resolved against the appellant.
It is convenient to defer the consideration of respondent’s issue No.2 to deal with its issue No.3 which encompasses appellant’s issue No.3. As formulated by the respondent, issue No 3 for ease of reference is reproduced hereunder,
“Whether the pronouncements of the court below as to the effect of its earlier decision dated 14th December, 1993 in Appeal No. CA/L/267/89 on the interim order made by Ayorinde, J. is wrong or occasioned a miscarriage of justice”
As earlier narrated, when the suit was filed, it was before Ayorinde, J. who granted an ex parte injunction against the respondent. On application by Mannesmann (1st defendant) to dismiss the suit on the ground among other things, that the suit is res judicata, same having been litigated upon in Germany, the learned trial Judge in a considered ruling, delivered on 23rd March 1989 granted the application and dismissed the suit against Mannesmann and appellant (1st and 2nd defendants). This ruling was reversed by the Court of Appeal in Appeal No. CA/L/262/89 delivered on 14th December, 1993 and a retrial ordered. The retrial was conducted before Segun, C.J. who in his judgment granted the appellant’s claims. In an appeal by the respondent to the Court of Appeal, against the judgment of Segun, C.J., the Court of Appeal observed in relation to the effect of its earlier decision in CA/L/262/89 thus:
“Whereas the suit was struck out by the court below, its restoration on appeal by order of retrial did not signify that the interim order of injunction was restored or revived. This is so because, an interim order in essence is normally restricted by time pending the determination of the motion on notice. It is not the case of the respondent that the appellate court in ordering a retrial of the matter also granted the interim order to maintain the status quo. Let me also observe that the granting of interim order or order of injunction in this matter was based on different considerations so that the granting of interim injunction in the matter should not make the order of injunction a conclusive matter.”
It is the above statement by the learned Justices of the Court of Appeal that the appellant is quarrelling with before this court. It is submitted that the proposition of the court below to the effect that the dismissal of the appellant’s case at the court of first trial by Ayorinde, J., even though reversed on appeal, did not revive or restore but rather was effective to have put to death permanently the interim injunction granted in 1989 by Ayorinde, J against the respondent was patently misconceived. It was argued that it was merely by necessary implication that the ruling by Ayorinde, J. terminated the life of the interim injunction granted earlier and therefore, if the judgment in the first appeal was effective to revive the substantive case that was expressly dismissed in the ruling of the trial court, it is legally incomprehensible that it will not also restore the interim injunction that was never sought to be discharged except by necessary implication. In support of the proposition, the appellant cited and relied on the decision of this court in the case of Attamah v. Anglican Bishop of Niger (1999) 12 NWLR (pt. 633) 6 at p. 12.
The respondent has submitted, quite rightly, in my view, that the excerpt from the judgment of the court below quoted above represents the correct position of the law. It is settled law that an order of interim injunction is a temporary form of injunction which remains in force until a named day and date. By its nature, it is expected to last for a very short period: see Okechukwu v. Okechukwu (1989) 3 NWLR (Pt. 108) 234; Kotoye v. CBN (1989) 1 NWLR (Pt.98) 419; Enekwe v. I.M.B Ltd (1997) 10 NWLR (Pt.526) 633. When, therefore, Ayorinde, J dismissed the suit on ground of res judicata, the ex parte order of injunction was thereby discharged.
The setting aside of the order of dismissal by the Court of Appeal did not imply the restoration or revival of the interim order of injunction. The contention by the appellant to the contrary is misconceived. The case of Attamah v. Bishop of Niger (supra) cited and relied upon by the appellant is irrelevant. In that case, an application to set aside an interim order of injunction earlier made was refused by the court but in the instant case the entire suit was dismissed. I will equally resolve the issue under consideration in favour of respondent.
The respondent’s 2nd and 4th issues will be taken together as both of them relate to the appellant’s 1st issue. For ease of reference, the respondent’s 2nd and 4th issues are recited thus:
“2. Whether the court below properly construed and applied section 14 of the High Court Law of Lagos State in the circumstances of this case.
- Whether the court below predicated the incompetence of the injunction granted by the trial court on wrong principles.”
These issues relate to the validity of the grounds relied upon by the court below in allowing the respondent’s appeal, and setting aside the injunction slammed against it by the trial court not to pay over to Mannesmann the 5% commission of contract sum claimed by the appellant under the ‘Commission Contract’. The court below had in several parts of its judgment in reaching to its conclusion, noted that there was no privity of contract between the respondent and the appellant in respect of that ‘commission contract’; it further noted that from the pleadings, the appellant has no cause of action against the respondent and that the respondent was not a stakeholder in the legal sense of the money the appellant was claiming against the Mannesmann and finally, it construed section 14 of the High Court Law of Lagos State, 1994 to see if in the circumstances of the case there was jurisdiction vested in the trial court to grant an injunction against the respondent. Section 14 of the said High Court Law provides:
“The High Court in the exercise of the jurisdiction vested on it by this Law shall, in every cause or matter, grant either absolutely or on such terms and conditions as the court thinks just, all such remedies whatsoever as any of the parties thereto may appear to be entitled to in respect of any legal or equitable claim properly brought forward by them on the cause or matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined, and all multiciplicity of legal proceedings concerning any of those matters avoided.”
The court below, in construing the above provision opined at p. 302 of the record, thus:
“The power conferred on the court by this provision has to be applied subject to the settled law that a court is not obliged to dispense reliefs not sought by parties as it is no charitable institution. Besides, where the power conferred on the court by section 14 has to be relied upon, it must be to complement “any legal or equitable claim properly brought to them.” It has been found that the appellant has in no way been impleaded in this matter. Recourse to section 14 cannot avail in the circumstances as the claim of injunction could not be maintained against the appellant in the situation.”
Learned senior counsel for the appellant has submitted in his brief of argument that an injunction is an equitable remedy not dependent on contractual relationship and that a Mareva injunction was appropriate to secure the interest of the appellant in respect of the “commission contract” of which the respondent was well aware of through the “commission contract” exh. B and the letter from appellant’s solicitor exh. M. It was contended that by its origin Mareva injunction is normally asserted against both the principally liable party in the substantive claim and a third party who has in its possession assets or property of the party against whom the principal relief is either contemplated or has been adjudged due. In support of these propositions, the following cases were cited and relied upon: Williams & Ors. v. Marac Australian Ltd. & Ors. NSWLR Vol. 15 1985 – 1986, 529 at 533 said to be a decision of Australia High Court following several decisions of English House of Lords; A-G. v. A.I.C. Limited (2000) 10 NWLR (Pt.675) 293, (2000) SC 175 at 185 and Mercantile Group (Europe) A-G. v. Aiyela (1994) 1 All E.R 113 and Adenuga v. Odumeru (2001) 2 NWLR (Pt. 696) 184. Citing the case of Gov. Lagos State v. Ojukwu (1986) 1 NWLR (Pt. 18) 621 at 636, it was submitted that as the respondent was warned through exh. M about the appellant’s claim and the pending appeal against the dismissal of its suit if in disregard of the warning it (respondent) paid out the money, it did so at its own peril. Finally, it was stressed that the amount in question, that is, the judgment debt which is in the sum of US 41 million dollars had been garnisheed absolutely against the account of the respondent with the United Bank for African Plc, since 2/11/2000 long before the decision of the lower court delivered on 24/5/2001.
In his reply, the learned senior counsel for the respondent submitted that the reasoning and conclusion of the court below with respect to the interpretation of section 14 of the High Court Law of Lagos State cannot be faulted, pointing out that the relief sought by the appellant against the respondent at the trial court was different from that granted by the trial court while the relief which ought to have been in the form of a perpetual injunction was couched in the form of an interlocutory injunction. Learned counsel contended that an injunction is an ancillary relief granted after the establishment of a right and submitted that as the appellant had not in the suit established any right against the respondent, an order of injunction could not lie against it on the authority of the case of Okebule v. Abaah (1988) 2 NWLR (Pt. 77) 496 at 503. It was conceded that the trial court was invested with the jurisdiction to grant a mareva injunction adding that in the circumstances of this case in which it was not established that Mannesmann’s Funds were in the custody of the respondent, there was no basis for the grant of a mareva injunction. It was further submitted that the funds garnished by the appellant since 2/11/2000 are the funds of the respondent and not money due to Mannesmann. Finally, learned counsel submitted that the authorities relied upon by the appellant, to wit, Governor of Lagos State v. Ojukwu (supra), A-G. v. A.I.C Ltd. (supra); Williams & Ors v. Marac Australia Ltd. & Ors (supra); Mercantile Group (Europe) A -G. v. Aiyela (supra) have no application to the instant case.
Flowing from what has been canvassed above, two questions arise for determination, viz:
“1. Whether, on the footing that the appellant had funds in the custody of the respondent, an injunction was grantable to restrain the respondent from disbursing the funds to Mannesmann.
- Whether, in actual fact the respondent had in its custody money that had accrued to the appellant.”
The first question is a legal one and can be answered in the affirmative. The doctrine of Mareva injunction operates to stop a defendant against whom a plaintiff has a good arguable claim from disposing of or dissipating his assets pending the determination of the case or pending payment to the plaintiff. The injunction can also be granted against anybody who is in possession of the defendant’s assets. In support of this proposition, I refer to the case of Sotuminu v. Ocean Steamship (1992) 5 SCNJ 17 – 22, (1992) 5 NWLR (Pt.239) 1 where this court held, per Nnaemeka-Agu, J.S.C., that the High Court of Lagos State has the jurisdiction and power to entertain and in appropriate cases grant a Mareva injunction as was developed by the High Court of Justice in England in 1975. The second question is one of fact and requires a careful appraisal of the pleadings, evidence and the judgment of the trial court. A perusal of the appellant’s statement of claim reveals that there is no averment alleging that the appellant’s funds were in the custody of the respondent. Equally, there was paucity of evidence in that regard. PW2 who gave evidence seemingly touching on the issue testified on 18/6/99 and said, inter alia –
“Segun Aderedolu: Male, Christian … I am a legal practitioner and company secretary to the Plaintiff/Company. I joined the company on 2/12/91. That was long after the transaction that led to this litigation has taken place. I obtained my information from the company’s documents in my duty as the secretary of the company …
…
The 1st defendant is not a Nigerian Company and has no presence in this country. As at 1988 when this action was filed they have (sic) funds outstanding with the 2nd defendant …
…
I don’t know if the 2nd defendant have made all payments in their hands to the 1st defendants
Cross – Examination
“I don’t know if the jobs had been completed or not. Payments are made after certification of the work done. We are entitled to 5% of any money accruable to the 1st defendant from the 2nd defendant …
We are aware that the 2nd defendant was making payments to the 1st defendant all along.”
The evidence of this witness to the effect that the 1st defendant (Mannesmann) in 1988 had funds outstanding with the respondent, not having been pleaded went to no issue. Furthermore, he PW2 not being an employee of either Mannesmann or the respondent could not have been in the position to know whether the former had funds outstanding with the latter on which the appellant’s 5% commission had accrued. His evidence, in my view, is based on speculation, so too in the finding of the learned trial Judge who in his judgment at p.52 of the record said:
“In the Statement of Defence of the 2nd defendant, they have not claimed and they are not claiming that they have made any payment to the 1st defendant. I therefore assume that the payment of the money is still with the 2nd defendant. If they have paid it out they must say so specifically in their statement of defence which they have not done.”
With profound respect, the above finding is tenuous and speculative. It is an elementary principle of law, for which a citation of authority is not necessary, that the onus is on a plaintiff to prove his case and he must do so on the strength of his own case and not on the weakness of that of the defendant subject to some exceptions. A court of law acts on facts and not on guess or speculation: see Ferdinand George v. UBA Ltd (1972) 8-9 Sc. 4 at 280; Carlen (Nig) Ltd v. UniJos (1994) 1 NWLR (Pt. 323) 631 at 668; Siesmographic Ltd. v. Ogbeni (1976) 4 Sc. 85 at 101 and Overseas Construction C Ltd. v. Creek Enterprises Ltd. (1985) 3 NWLR (Pt 13) 407. The
appellant did not consider it necessary to obtain admission from the respondent by way of interrogatories. In the absence of such admission, it is difficult to see how the appellant can establish that the respondent had Mannesmann’s funds from which the appellant’s 5% commission had accrued. Indeed, if Mannesmann had completed its job, the presumption is that it had been fully paid but the appellant does not know whether the job had been completed. In my view, from the evidence on record, it has not been established that the appellant had funds in the custody of the respondent for which an order of Mareva injunction could be granted to restrain respondent from paying over to Mannesmann.
I am strengthened in this view by the ruling of this court dated 24/6/2002 made on application by the appellant for certain injunctive reliefs. The ruling in part reads thus:
“I find no merit whatsoever in this application. The evidence before us is that NNPC is not now owing the 1st defendant any amount as the 1st defendant has been fully paid in 1993 and 1994 in respect of contracts 1 and 2 respectively. Furthermore, there is evidence before us that the 1st defendant is no more in existence.”
The subsequent ruling of this same court on 23/9/2002 allowing the appellant to amend its notice of appeal did not alter the position. It was submitted at page 32 of the appellant’s brief, and quite rightly, in my view, that once the Court of Appeal has decided an issue in a particular way, the same court cannot reach a different decision in the same case as it would have become functus officio in the matter. By the same token, since this court had earlier decided, as per the ruling of 24/6/2002, that Mannesmann (1st defendant) had been fully paid in 1993 and 1994, it would be wrong for the court to now reverse that finding there being no evidence or suggestion that it was made without jurisdiction. In the face of the ruling in question, it would not be correct to contend as the appellant had done, that the money in the account of the respondent at UBA Plc which was garnisheed by the appellant represents the amount due to the appellant as commission in respect of its undertaking with Mannesmann.
The appellant has cited and relied on several authorities particularly the case of Mercantile Group (Europe) A.-G. v. Aiyela (supra), the facts of which may be summarised thus: Aiyela, a Nigerian was a man of enormous influence. He often negotiated lucrative contracts for foreign corporations in Nigeria in return for large commissions. In 1983, he negotiated contract in favour of Plaintiff for a large consignment of oil. For the purpose, the plaintiff put him in substantial funds to pay the purchase price. He underpaid the sellers and refused to return the difference save a small portion thereof leaving outstanding 1.6 million US Dollars. In 1984, plaintiff sued him joining alongside his wife and two other companies although none of the latter was party to the contract between Aiyela and plaintiff. The only basis of their joinder was that they had Aiyela’s funds which had mixed up with theirs and as such were constructive trustees of the said funds. After some compromises, Aiyela paid some amount leaving still outstanding a substantial amount and so judgment was entered against him for the balance on due date. In trying to enforce the judgment no asset of Aiyela could be traced. It later emerged that a payment had been made into the account of Mrs. Aiyela from Nigeria on the instructions of Mr. Aiyela whereupon a Mareva injunction was granted by Sevile, J in respect of any amount on which she could draw at the particular bank. It can be seen from the facts of Aiyela’s case that the fact that Aiyela had transferred his money into his wife’s account was not disputed. That is not the situation in the instant case in which there is paucity of evidence as to whether the funds of Mannesmann was still in the custody of the respondent, a doubt which the ruling of this court has resolved negatively. It is, therefore, my view that Aiyela’s case is not on all fours with the case in hand.
Learned counsel for the appellant has in his reply brief complained that the only issue of fact considered by the court below related to exh. M. My simple reply to that is that the doctrine of Mareva injunction which has featured prominently in this appeal was not canvassed before the court below and since its applicability is dependent on the possession of a third party or nominal defendant the asset of the principal defendant, an enquiry in that regard is imperative.
But, even on the footing that the funds of Mannesmann were still in the custody of the respondent, it was incumbent for the appellant to establish that its right to 5% commission had accrued. In this regard, I bear in mind the terms of the commission contract, exh. B which it entered into with Mannesmann. Part of exh. Breads:
“In case an order is accepted by us on the basis of the offer submitted by us, we would grant you a commission of 5 percent, calculated on the basis of the amount transferred to a German Bank and credited to Mannesmann Anlaganbau A.G, freight, packing costs and customs are not subject to a commission; they are to be deducted from the amount of cash payment before calculation of commission. Payment of the commission would be made in the same currencies as received from client.”
From the above terms, it is evident that, firstly, the amount due to the appellant is only ascertainable after freight, packing costs and customs dues are deducted from the contract sum or part thereof; secondly, the 5% commission becomes due after money due to Mannesmann has been transferred to a German Bank and credited to the account of Mannesmann and thirdly, the 5% commission is payable in the currency in which Mannesmann was paid. It is not until the first and second conditions are complied with that the appellant’s right to 5% commission will accrue. There is nothing on record to show that the above pt and 2nd conditions had been met. I am of the view that until they are met the appellant’s claim against the respondent for an order of injunction is not maintainable. This is so because an injunction is an equitable remedy and it can only be granted in support of a right known to law or equity: see Yalaju Amaye v. A.R.E.C. Ltd. (1990) 4 NWLR (Pt.145) 422; Afrotec Technical Services (Nig.) Ltd v. M.I.A. and Sons Ltd. (2000) 15 NWLR (Pt.692) 730. In the light of the foregoing, the decision of the court below in setting aside the order of injunction made against the respondent cannot be faulted. Its reason for doing so may not be right but it is settled law that an appellate court will not set aside the decision of a lower court which is right and just merely because the lower court gave wrong reasons for the decision. The paramount consideration for the appellate court is whether the decision is right not necessarily what the reasons are: see URA Ltd & Anor. v. Achoru (1990) 6 NWLR (Pt.156) 254; Oseni v. Dawodu (1994) 4 NWLR (Pt. 339) 390; A.-G. Bendel State v. A.-G. of the Federation & Ors. (1981) 10 SC. 1 at p. 62-63, (1982) 3 NCLR 1; Ebevuhe v. Ukpakara (1996) 7 NWLR (Pt. 460) 254 at 269; Ukejianya v. Uchendu 13 WACA 45. The Ojukwu’s case (supra) is irrelevant in the consideration of this case.
I will resolve the appellant’s issue No.1 and the respondent’s issues 2 and 4 in favour of the respondent against the appellant.
As all the issues considered in the main appeal have been resolved in favour of the respondent, the appeal lacks merit and is consequently dismissed with N10,000.00 costs to the respondent against the appellant.
SC.237/2001
