Federal Mortgage Finance Ltd V. Okedo Enterprises Ltd (2009)
LawGlobal-Hub Lead Judgment Report
NWALI SYLVESTER NGWUTA, J.C.A.
This is an appeal against the judgment delivered on 22/11/2000 by the High Court of Justice, Akwa Ibom State sitting at Uyo.
The Respondent (then plaintiff) claimed against the appellant (as defendant) the following reliefs:
” 1. A declaration that is contractual relationship with the defendant at all material times is governed by the provisions of the Deed of Mortgage executed between the plaintiff and the defendant and no more.
2. A declaration that the Defendant’s right to foreclose and or sell its Estate held by virtue of Certificate of Occupancy No. ITR/084/82 and located at Itam Junction in the capital city of Uyo, Akaw Ibom state of Nigeria has not crystallized.
3. An order directing the Defendant to effect a reconciliation of the plaintiff’s account with the Defendant.
4. An injunction to restrain the defendant, Federal Mortgage Finance Limited, by its directors, officers, servants or agents or whosoever from selling, disposing or otherwise dealing with the plaintiff’s Estate located at Itam Junction, Uyo, Akwa Ibom State of Nigeria.”
The parties filed and exchanged pleadings. In its statement of defence and counter-claim the appellant counter claimed:
“(a) The sum of No 13,833,342.88 being amount overdue and payable as principal sum and accrued interest on Mortgage facility granted to the plaintiff by the defendant Bank as at 31/3/2000 which the plaintiff has failed, refused and or neglected to repay despite repeated demands.
(b) Interest on the said sum of No 13,833,341.88 at the rate of 20%per annum from 31/3/2000 until final liquidation.”
The respondent filed a Reply and defence to the Counterclaim in which it denied the appellant’s counter-claim.
On 17/3/2000 and pursuant to a prior agreement between learned Counsel for the parties the trial Court ordered
“The plaintiff is to deposit the N1 million to the Defendant and to file the teller with the Court, pending the appearance of the Independent Auditor, Mr. Gamble in Court for the guidelines of the Court in Reconciliation of Account between the plaintiff and the defendant”
The order was complied with.
On 31/7/2000 learned Counsel for the Respondent (then plaintiff) applied under Order 18 Rule 3 of the High Court (Civil Procedure) Rules of Akwa Ibom State for an order:
“( 1) That the Independent Auditor be given the following directives. That he be directed to reconcile the plaintiff’s account with the defendant to determine the actual sum or sum(s)due and payable to the defendant.
(2) That the defendant Bank place(sic) Court the deposit of Independent Auditor all Books, records, accounts and Agreement and notices to facilitate the work of reconciliation.
(3) That the Independent Auditor to submit his report in a date to be agreed upon by the parties.”
Learned Counsel for the parties agreed to abide by the directives sought as well as the Independent Auditor’s report.
The Court ordered;
“Application granted.
(1) That the defendant Bank make all the relevant Books of account, records, Agreement and milicy available to the Independent Auditor to facilitate reconciliation of account between plaintiff and defendant.
(2) That to bring the matter to main end to settle the indebtedness taking into consideration that (sic) the rate of interest has to be on a 50/50 basis.”
See page 128 of the records.
On 28/11/2000 the report of the Independent Auditor was admitted through Mr. James Gamble, Principal Partner of Thomas Gamble & Co. (Chartered Accountants) of No. 79, Ikot Ekpene Road, Uyo and marked Exhibit ‘A’. He stated on oath
“The amount of indebtedness is N6,628,148.49. But for the 50/50 the amount could have been N13,027,385.55”.
The trial Court ordered “EXHIBIT ‘A’ endorsed and adopted as the judgment of the Court.”
See page 129 of the records.
Aggrieved by the portion of the judgment on the rate of interest on a 50/50 basis the appellant appealed on one ground. With the leave of the Court the appellant filed two additional grounds of appeal, making a total of three grounds to the Respondent as the main disputes between the parties in the Court below. Counsel said that based on the claims the only issue for the trial Court to resolve is the Respondent’s indebtedness to the appellant and to show good faith in the transaction leading to the dispute, the Respondent paid N1million to the appellant. He said that the Independent Auditor’s report showed that the sum of N13,027,385.55 was due from the Respondent to the appellant but this was – reduced by the 50/50% basis of interest ordered by the Court to N6,628, 148.49. Learned Senior Counsel submitted that the order of reduction of the debt without any request from either party and subsequent confirmation of same in the judgment without opportunity to the parties to address the issue led to miscarriage of justice. He relied on UNION BANK OF NIGERIA LTD v. OZIGI (1994) 3 NWLR (PT.333) 385 AT 401, EJOWHOMU v. EDOK-ETER Ltd (1986) 5 NWLR (PT.39) 1, DPMS LTD v. LARMIE (2000) 5 NWLR (PT.655) 138 AT 158, OGIAMIEN v. OGIAMIEN (1967) ALL NLR 191, OLUREFIMI v. IGE (1993) 8 NWLR (PT.311) 257 AT 271 PARAGRAPHS E- F, NDIC v. S.B.N. PLC (2003) 1 NWLR (PT.801) 311 AT 385. Learned Counsel said that no further evidence is required as the whole proceeding is documentary and urged the Court to invoke its powers under Order 1 Rule 19(3)and (4) of the Court of Appeal Rules to do substantial justice. He urged the Court to allow the appeal.
In his brief of argument learned Counsel for the Respondent predicated his preliminary objection and argued same, on four grounds.
“1. The judgment appealed against is a consent judgment which the defendant cannot appeal against without leave. He referred to Section 214(2)(c) of the Constitution of the Federation 1999 and contended that a party has no right of appeal against a consent judgment without leave of Court. He relied on AGWARANGBO v. NAKANDE (2000) 9 NWLR (PT.627) 344.
2. Ground one of the appeal is incompetent on the basis of the interest at 50/50 was laid down in an interlocutory decision dated 31/7/2000 against which there no appeal within 14 days.
Counsel relied on OJO vs. ANIEBIRE (1991) NWLR (PT.628) 630 AT 639.
3. The complaint based on 50/50 basis of interest is a fresh point raised on appeal without leave of Court. The issue ought to be struck out. He relied on BABATOLA v. ALADEJAN (2001) FWLR (PT. 61) 1670 AT 1674.
4. Learned Counsel said, the lone issue for determination, based on incompetent ground of appeal is incompetent and ought to be struck out” .
He relied on OKEKE v. OKEREKE(1996) 6 NWLR (PT.452) 60 AT 73 PARAGRAPHS D – E, BOOGOM v AWAN (1995) 1 NWLR (PT.410) 692 AT 701 – 702 PARAGRAPHS H – A. He urged the Court to strike out the appeal.
Arguing the lone he raised, learned Counsel contended that
(a) that no waiver was awarded, rather the auditor was charged to reach a compromise on the conflicting interest rates claimed by both sides;
(b) interest rate was properly raised in the pleading of both parties;
(c) even if the 50/50 interest rate was raised suo motu the parties had ample opportunity to have addressed the Court on the issue;
(d) In any case this was a consent judgment not bound by the pleadings of the parties; and
(e) the appellant is estopped by his conduct from complaining.
In response to the appellant’s argument on the lone issue in the appellant’s brief Counsel argued that Order 18 of the High Court (Civil Procedure) Rules is in applicable and that the procedure adopted by the trial Court was akin to reference to arbitrator pursuant to Order 19 of the Rules, but if reliance was placed on Order 19 the appellant did not object within fifteen days from the publication of the award pursuant to Order 19 Rule 13. Based on the argument on preliminary objection, Counsel urged the Court to strikeout the appeal and on the merit he urged the Court to dismiss the appeal and uphold the judgment of the Court below.
In his reply brief learned Senior Counsel for the appellant argued that there could not have been a consent judgment when Amanim Akpabio had informed the Court that “Settlement has broken down …” He said it was the application of the Respondent under Order 18 Rule3 of the High Court Rulesthat the appellant consented to. There was no term of settlement upon which a consent judgment could have been based. He relied on VULCAN GASES LTD v. G. F.IND.AG (2001) 9 NWLR (PT.719) 610 AT 645, WOLUCHEM v WOKOMA (1974) 3 SC 155. He contended that a judgment obtained under Order 18of the Akwa Ibom High Court Rules is not a consent judgment.
On the complaint against ground one, learned Counsel said the jurisdiction of the Court was in issue as the Court granted a relief not sought by any party. He relied on ALAKE v. ABALAKA (2003) 6 NWLR (PT.815) 124at 138- 139 and contended that even though he was granted leave of the Court on 18/5/2006 the issue could have been validly raised without leave. He urged the Court to allow the appeal and enter judgment in the amount found by the auditor without the 50%reduction of interest ordered by the Court.
First of all I will deal with the preliminary objection of which – the respondent gave notice and which was argued in the Respondent’s brief.
On ground 1 of the objection it is my view that the judgment appealed against is not a consent judgment as defined by the authorities. Details will emerge in the judgment.
On ground 2, the trial court may have laid down the basis of interest as 50/50 on 31/7/2000 in interlocutory proceedings but the appeal is on the adoption and importation of the 50/50 basis of interest into the final judgment.
On ground 3, the 50/50 basis of interest may be a fresh issue but in the circumstances it could not have been raised in the Court below and in any case it is an issue of jurisdiction which can be raised at any stage of the proceedings, even on appeal as in this case.
Finally, on ground 4 the grounds of appeal from which it is formulated are competent and ipso facto the issue is competent. lover-rule the preliminary objection on each of the four grounds argued by the respondent.
Now, the question is whether or not the judgment of the Court below delivered on 28/11/2000 is a consent judgment within the con of decided authorities.
On 17/5/2000 learned Counsel for the parties agreed that the appellant Bank be ordered to provide all books, records, accounts etc to the Independent Auditor to reconcile the accounts of the Respondent with the appellant bank to determine the actual sum due from the Respondent to the appellant and to abide by the Auditor’s report.
In granting the application to order the appellant bank to submit the necessary documents to the Independent Auditor for the reconciliation of the account of the Respondent with the appellant Bank the Court below ordered “That to bring the matter to main end to settle the indebtedness taking into consideration that at time the bank write off ritian (sic) the rate of interest has to be on 50/50 basis.”
See page 128 of the records. The issue of 50/50 rate of interest was not raised by any party. It was an ex-gratia award in favour of the Respondent.
Exhibit ‘A’ endorsed and adopted as the judgment of the Court indicated that the actual indebtedness of the respondent to the appellant bank stood at N13,027,385.55but this was reduced to N6,628,148.49due to the 50/50 basis of interest ordered by the Court.
From the records the Respondent did not ask for 50/50 as the basis of interest rate nor were the parties ad idem on the rate of interest imposed by the Court suo motu. Learned Counsel for the Respondent said that Counsel for the parties were given opportunity to address the issue raised by the Court suo motu but this is not borne out of the records. And the Court had no business to make a case for the respondent on the basis of interest. The Court had no jurisdiction to order 50/50 interest rate in favour of the respondent against the appellant and the issue can be raised at any time in the proceedings even on appeal as herein. See OLORIDE v. OYEBI (1984) 1 SCNLR 390. Judgment properly so called is predicated on triable issues in the pleading and evidence on same adduced in Court. See INCAR (NIG) LTD v. BENSON TRANSPORT LTD (1975) 3 SC 117. The judgment in so far as the 50/50 basis of interest resulting in the shortage of the sum of N6,628,148.49 in the reconciled account showing the actual amount due for the respondent to the appellant is not based on any issue raised in the pleadings or evidence oral or documentary adduced before the Court.
In order to answer the poser raised earlier in this judgment it is appropriate to define “consent judgment”. A consent judgment is a judgment predicated on, and reflecting the express terms of agreement between the contending parties.
See LAUWERS IMPORT-EXPORT v JOZEBSON IND. CO. LTD (1988) 3 NWLR (PT.83) 429; WOAUCHEM v. WOKOMA (1974) 3 SC. 152.
A judgment is not consent judgment for the mere fact that the defendant submits to it: LAUWERS IMPORT-EXPORT v. JOZEBSON – (supra). A purported consent judgment does not bind a defendant who is not shown to have consented to it – see TALABI v ADESEYE (1972) 819 SC 20.
The Court cannot compel a party to agree to a consent judgment as the element of compulsion would vitiate the volition of the defendant. See ODULAJA v WILLIAMS (1960) 6 WACA 198, AFOLABI & AN OR v. ADEKUNLE & ANOR (1983) 8 SC 98. In my view the order relating to the 50/50 rate of interest based on neither the pleadings nor evidence before the Court and ipso facto made without jurisdiction exhibits element of compulsion and constitutes a serious violation of the appellant’s right to a fair hearing. The principle of Justitia Nemini remini neganada – Justice shall be denied to no man is one which everyone who adjudicates on the conflicting rights of parties must respect and strictly adhere to. See OCEAN STEAMSHIP NIG. LTD v. SOFUMINU & ANOR (1997) 2 NWLR (PT. 487) 284. In the case at bar not only did the Court fail to give the parties, particularly the appellant, the opportunity to address the issue raised suo motu from the blues by the lower Court the issue is not an issue in the case before the Court.
Based on the above, I hold that the judgment delivered by the Court on 28/11/2000, in so far as it relates to the 50/50 basis of interest in the sum due from the Respondent to the appellant is not a consent judgment and consequently the appellant did not require leave of Court to appeal against it.
Also I hold that the lower Court has no jurisdiction to make an order or confirm an order relating to the 50/50 basis of interest in favour of the respondent and against the appellant when the issue was not agitated by the parties before the Court.
In the final result I resolve the lone issue in the appeal in favour of the appellant. I allow the appeal and set aside the portion of the judgment relating to the 50/50 basis of interest. In its place I enter judgment in favour of the appellant in the sum of N13,833,342.88 found by the Independent Auditor in Exhibit ‘A’ as the actual sum of money due from the respondent to the appellant bank.
The Respondent is to pay the sum of N20,000.00 as costs to the appellant.
Other Citations: (2009)LCN/3174(CA)
