Diamond Bank Limited V. General Securities and Finance Company Ltd (2008)
LawGlobal-Hub Lead Judgment Report
MONICA BOLNA’AN DONGBAN-MENSEM, JP+, J.C.A.
The account of the facts giving rise to this interesting appeal is hereby reproduced verbatim as presented in the Appellant’s brief of argument: –
“1.1. This is an appeal against the ruling of the High Court of Lagos State, Lagos Division in Suit No. M/427/2002.
1.2. The Appellant in this action is a Defendant in an action in The Chancery Division of the High Court of England with No. HC0100699 between LUIZ VICENTE BARROS JR. AND ORS VS MAC DANIELS LIMITED AND ORS, From which tracing and freezing orders were made to Freeze the account of the Plaintiff herein pending the Determination of the suit in England.
1.3. By an originating summons dated 24th June, 2002 and filed on 26th June, 2002 at the High Court of Lagos Registry, the Plaintiff/Respondents pursuant to an Assertion that the Defendant froze its accounts with Numbers 026-2010013837, 018-2010005273 and 018-2010005285, held in the Defendant Bank, prayed the court for the determination of the following questions:
1) Whether the order/judgment of a court of sovereign Foreign jurisdiction, namely the High Court of Justice, Chancery Division of London, England directing the defendant to these proceedings to freeze and preserve monies held by the Defendant on the plaintiffs Account in Account Nos. 026-2010013837, 018-2010005273 and 018-2010005285 and thereby denying the plaintiff operation of the said Account and by reason thereof denying the plaintiff benefit of the use of its monies, is valid, proper, legal and therefore enforceable in Nigeria and under Nigeria Law, when, the said order and judgment has not been registered in Nigeria in the manner prescribed by the foreign judgment (Reciprocal Enforcement Act) Cap 152, Laws of the Federation of Nigeria, 1990.
2) Whether the Judgment/Order of the High Court of Justice, Chancery Division, London, England directing the Defendant herein as is alleged to freeze and/or preserve monies held by the Defendant on the plaintiff’s accounts in Account Nos. 026-2010013837, 018-2010005273 and 018-2010005285 is a violation of the plaintiff’s rights under section 36 of the constitution of the Federal Republic of Nigeria 1999.
3) In the event that the answer to 2 above is in the affirmative, whether, the said judgment/order of the High Court of Justice, Chancery Division, London, England can therefore be enforced against the plaintiff.
1.4. The plaintiff further sought the following reliefs and others:
1) An order compelling the Defendant to unfreeze the Plaintiffs account and allowing the plaintiff to Operate in Account Nos. 026-2010013837; 018-2010005273 and 018-2010005285 normally without let or hindrance.
2) An order restraining the Defendant, its officers, Agents or privies from further freezing and or precluding plaintiff from operating its account on the basis of foreign judgments and/or orders not registered in the manner prescribed by law.
3.) An order restraining the Defendant, its officers, Agents or privies from further releasing information pertaining to the Plaintiff’s account to anybody whatsoever, without plaintiff’s consent, on the basis of directives and or orders not registered in the manner prescribed by law.
4) Damages in the sum of N2,000,000. 00 (Two Million Naira) only, being damages incurred by the plaintiff from the action of the defendant in precluding it from operating its account used for its business as a financial institution.
1.5. The matter came before the Court for the first time on 3 July, 2002, both parties were represented and the suit was further adjourned to 9 July, 2002 for hearing of the Originating process.
1.6. On 9 July, 2002 when the judgment was fixed for hearing the Defendant was not represented due to the fact that counsel charged with the conduct of the case – Mr. P.A. Osu had a car break down on his way to Court, and before he could get to Court the Originating summons had been heard and the orders sought by the Plaintiff had been granted.
1.7 Judgment was delivered on 9 July, 2002 in favour of the Plaintiff/Respondent. All the reliefs sought by the Plaintiffs/Respondent were granted
1.8 The Appellant dissatisfied with the judgment of the lower Court appealed to this Court on 9 July, 2002. The Notice of Appeal was filed on 10 July, 2002 in the Registry of this Court.
- STATEMENT OF MATERIAL FACTS
2.1 The essential facts relied upon by the Plaintiff/Respondents at the trial are to be found in paragraphs 1-15 of the affidavit in support of the Originating Summons and the further Affidavits filed on 3 July, 2002 and 9 July, 2002.
The Plaintiffs/Respondents also relied on a total of 3 exhibits. The facts of the matter are summarized as follows:
2.2 That the Plaintiff Respondent were customers of the Defendant/Appellant bank and operates account Nos. 026-2010013837; 018-2010005273 and 018-2010005285.
2.3 That in the course of the Plaintiffs business sometime on 3 June, 2003 and 7 June, 2003 respectively, the Plaintiff/Respondent presented 2 cheques – No. 4305649 and 4900900 respectively for payment by the Defendant/Appellant, which cheques were dishonoured. Both cheques were annexed as “Exhibits GSF 1 and GSF 2”.
2.4 That upon enquiry by the Plaintiff/Respondent it was informed that its account with the Defendant/Applicant were frozen pursuant to the orders of the High Court of Justice Chancery Division, London, England Upon which the Plaintiff/Respondent briefed its solicitors who wrote a letter to the Defendant/Applicant dated 7 June, 2002 demanding that the Plaintiff/Respondent be allowed to operate its accounts. The said letter was annexed as “Exhibit GSF 3”.
2.5 The Defendant/Applicant in their reply dated 11 June, 2003 signed by its Company Secretary/Legal Adviser confirmed that the Defendant/Applicant was served with a Court Process by the High Court of Justice, Chancery Division, London, England commanding it to enter appearance as Defendant in Suit No HCO100699 – Luiz Vincente Barros Mattos Jnr. And Ors Vs Macdaniels Limited and Ors which was accompanied by an order dated 13 May 2002, commanding the Defendant to ensure that the proceeds of the Plaintiff’s account are preserved and not withdrawn.
2.6 The Plaintiff/Respondent contended that the order and Judgment of the High Court of Justice, Chancery Division, London, England cannot be enforced in Nigeria except and only if it is registered in the manner provided by the Foreign Judgments (Reciprocal Enforcement Act) Cap. 152, LFN 1990 and also that the judgment of the High Court of Justice, Chancery Division, London, England was made in violation of Section 36 of the 1999 Constitution of the Federal Republic of Nigeria as the Plaintiff/Respondent was not heard before the order and/or judgment was made.
2.7 The above facts formed the basis upon which the Plaintiffs/Respondent and the Appellant proceeded to hearing of the Originating Summons in the lower Court.
- JUDGMENT OF THE LOWER COURT
3.1 The learned trial judge entered judgment in favour of the Plaintiffs/Respondent on 9 of July, 2002 granting all the reliefs sought, In arriving at its decision, the lower Court held inter alia that having perused the Originating Summons and the affidavits in support if was clear that the Plaintiff/Respondents accounts were frozen in reliance and compliance with the order of a High Court in England without that order having been registered in Nigeria as prescribed by law, and held that this was an abuse of Nigeria’s sovereignty under international law and was outrightly unlawful, null and void.
- ISSUES FOR DETERMINATION
The Appellant respectfully submits that the following issues arise for determination in this Appeal:
4.1 Whether the learned trial judge was right in determining Questions in an Originating Summons relating to an Order of the High Court of Justice, Chancery Division London, England without having a copy of the said judgment/order before him.
4.2 Whether the learned Trial Judge was right in assuming that all Judgments/Orders made outside the Jurisdiction of Nigeria are subject to Registration Under the Foreign Judgment (Reciprocal Enforcement) Act Cap. 152 Laws of the Federation of Nigeria 1990.
In a rather strange turn of events, the Appellant, which had frozen the account of the Respondent on the strength of an order from a foreign Court, now challenges the Respondent for failing to produce the said Order/Judgment.
He who alleges has the burden of proof. In the case of Alh. Isah. T. Sokiro Vs Joseph Daku Kpongbo and 3 Ors (2008) 7 NWLR Pt.1086 P342 at 362, the Supreme Court reiterated the cardinal principle of law that he who asserts must prove his case with credible and unchallenged evidence. It is incumbent on the Appellant to justify its source of authority to freeze the Respondent’s accounts.
Ordinarily, it is the Respondent that is legally bound to produce the original exhibits to prove his case by virtue of Section 134 of the Evidence Act. Failure to produce the said document entitles the Court to draw the inference and apply the provisions of Section 148 (d) of the Evidence Act (Refer: Habib Nigeria Bank Ltd. Vs Fathudeen Syed M. Koya (1992) 7 NWLR Pt.251 P43 at 57 and 58).
The Appellant broke the fiduciary confidentiality between the Respondent and itself, being a banker customer relationship. In Nigeria by some statute, the Appellant Bank is obliged by law to divulge and thereby undermined the said confidentially. However, there are conditions to be met for such a defence to be raised and upheld in a Court of law.
By the same token,an order from a foreign jurisdiction must meet certain conditions before it is executed in Nigeria. These conditions are clearly set out in Section 4 of the Foreign Judgments (Reciprocal Enforcement) Act as follows: –
- There must be a Judgment creditor in respect of a foreign Judgment,
- An application for registration of the Judgment must be made to a superior Court of record in this Country;
- The application must be made within six years or one year as the case may be from the date of Judgment sought to be registered, and
- The Judgment must not have been satisfied either in whole or in Part.
The establishment of the fulfillment of these conditions may entitle a Judgment creditor to enforce the Judgment. However, if the Judgment debtor takes out any objection raising an issue of the infraction of any of its constitutional right, the Court may not issue the order for the registration of the said foreign Judgment. The question of its enforcement would then become a far cry, an realizable desire.
It was the Appellant who denied the Respondent access to its funds in its custody as its bank, the Appellant being a commercial bank. It follows naturally that it is the Appellant who should have produced the foreign order it relied upon to freeze the account of the Respondent. It failed to do so. (PBN Vs Adegbesote (1986) 3 NWLR (Pt.44) 707).
It was the Appellant which brought up the existence of a foreign order. The trial Court cannot therefore be vilified for referring to the said Judgment the existence of which was declared as having been acted upon by the Appellant.
Equally, it is fallacious and fanciful thinking to maintain that the Respondent had any burden of proof in the circumstance. In law once a fact has been admitted there will no longer be a burden to prove what has been admitted. In the case of United Bank for Africa Plc and Anor Vs Alh. Babangida Jargaba (2007) All FWLR Pt.380 P.1419 at 1436, the Supreme Court held that:-
“An admission in law is referred to as a statement, oral or documentary, which suggests any inference as to any fact in issue or relevant fact.”
The Judgment of the trial Court is very clear on this and it is hereby reproduced:-
COURT
“Having perused the Originating Summons herein and the affidavits in support thereat particularly the documents annexed thereto as exhibits, it is not in doubt however that the Defendant Bank actually froze and prevented Plaintiff Company from accessing its funds in its accounts in issue with it (the Defendant) based upon an alleged order of the High Court of Justice, Chancery Division, London in suit No. HCO/00699 – in which the Plaintiff was not stated to be in party in the least. A copy of the said English order was also not shown or exhibited by the Defendant. See “Exhibit GSF1”.
Plaintiff also presented cheques for payment – “Exhibits GSF1 and 2nd to the affidavit in support which Defendant refused to honour relying on the said foreign order. Plaintiff Counsel wrote in protest “Exhibit GSF3” and that was what elicited “Exhibit GSF1” – Defendant’s Reply.
No order of this Court or any other Court in Nigeria has been shown by which that foreign order was registered in any part of Nigeria as to become operative and enforceable in this Country.
Even in Nigeria, the Judgment or order of one State High Court cannot be enforced in another without the registration thereof in the state where it is being sought to be enforced.
More crucial therefore is the case where it is the Judgment or order of a foreign Country that is in issue. In such a situation the Sovereignty of thus Country is called into issue. It is not in dispute that Nigeria is a member of the International Community and it is in recognition of that with particular reference to the subject in issue, that it punished for registration of foreign judgments within its territorial jurisdiction before they can have force therein (Emphasis mine).
If that was at necessary and judgments of other Countries could just like that and upon presentation be enforced in this Country, there would have been no need for the enactment of the Foreign Judgments Reciprocal Enforcement Act.
There is therefore no doubt that the act of the Defendant in freezing the accounts of the Plaintiff in issue, in reliance and compliance with the purported order of a High Court in English without that order having been duly registered in Nigeria as prescribed by law was a gross abuse of Nigeria’s sovereignty under International Law, outrightly unlawful null and void and so hold. (Emphasis mine).
This became more Contumacious when the fallacy was protested by Plaintiffs Counsel and Defendant brazen facedly relied as in “Exhibit – GSF1” attached to the further Affidavit in support of this application.
From the above judgment, it is difficult to fathom the basis of the argument of the Appellant. In fact it is uncertain, what is sought to be achieved by this appeal. The trial Court is right, Nigeria has since ceased to be a colony under any sovereign state. Nigeria is also a sovereign state and all foreign and “aliens” persons, matters and issues must be registered in accordance with Nigerian municipal law before such can have legal effect in Nigeria.
From the terms of the brief Judgment of the trial Court which has been reproduced supra, I am unable to see the need to proceed any further with the consideration of the other issues raised in the appeal. The learned trial Judge is right.
It is now a trite principle of law that you cannot place something on nothing. The issue of the constitutionally of the judgment is a non-starter since the said instrument has not been brought in by the due process of law. The Appellant acted ultravires its powers in freezing the account of the Respondent.
The trial Court was right in ordering a reversal of all the actions taken by the Appellant.
I find no justification whatsoever in interfering with the decision of the trial Court on this issue.
Damages:
The Court found it appropriate to awarded damages to the Respondent. The trial Court declared that:-
” … This therefore becomes a matter to give full weight in the determination of quantum of damages to award the Plaintiff for the breach of its Banker/Customer Contract between it and Defendant. In all therefore, This Summons succeeds in its entirely.
All reliefs prayed for are granted as prayed. I award N1 Million Naira damages in favour of Plaintiff against the Defendant, for Defendant’s wrongful and unlawful denial of access to Plaintiff of its funds in its accounts in issue.
The said accounts shall be defrozen forthwith and a Certificate of Compliance shall be filed in this Court by the Managing Director and a Company Secretary/Legal Adviser of the Defendant Bank within 48 hours after Service of this order on the Bank.”
The principle of law is the Appellate Court does not unduly interfere with the award of damages made by a trial Court. The exception is only when the principles of law are not observed in such exercise which could render the decision injudicious, perversed.
In awarding damages to the Respondent, the status and responsibility of the Respondent as a financial institution was requisite. The main function of the Respondent is the utilization, the movement and transfer of money. This the Appellant totally frustrated, halted as it where, by freezing the account of the Respondent without prior notification. Two cheques issued by the Respondent were dishonoured. (Refer Judgment of trial Court quoted supra).
Surely, a man deserves to be confronted with his crime before he is condemned. Indeed, by the provisions of Section 36 of the 1999 Constitution, he will not only be notified, he is entitled to be heard after due preparation. He is not only to be informed and confronted with the allegation; he is entitled to be a part of the process of proving the said allegation and is entitled to state his bit before he is condemned. No evidence was placed before the trial Court to show that the Respondent was even an unheard party. He was not a party at all.
Nigeria is a sovereign state, its territorial integrity cannot be infracted with impunity, whether by force of arms or by orders of Court outside its jurisdiction.
The High Court of England cannot without consultation with a High Court in the Federal Republic of Nigeria, execute its judgment in Nigeria, whoever and whatever institution is concerned. Such a decision can only be given effect when duly registered in compliance with the municipal law of Nigeria. In the case of African Reinsurance Corporation Vs J.D.P. Construction Nig. Ltd, the Supreme Court reiterated the latin maxim par in parem non habet imperium- i.e. no state can claim jurisdiction over another.
The High Court of England has no exemption, no immunity from the application of the foreign Judgment Enforcement Act of Nigeria.
I shall not interfere with the damages awarded.
This appeal is without merit and is hereby dismissed.
The judgment of the trial Court and all the consequential orders are hereby affirmed. The accounts of the Respondent which were illegally frozen shall be defrozen forthwith with the pronouncement of this Judgment.
A cost of N30,000.00 is awarded to the Respondent and against the Appellant. It is hereby so ordered.
Other Citations: (2008)LCN/3069(CA)
