Abunuhu Nigeria Ltd & Anor. V. Fareast Mercantile Co. Ltd (2009)
LawGlobal-Hub Lead Judgment Report
JOHN INYANG OKORO, J.C.A.
This is an appeal against the judgment of the Kano State High Court in suit No K/537/98 delivered by Hon. Justice B.S. Adamu on the 2nd day of June 1999 in favour of the Respondent on a matter which was filed on the undefended list pursuant to Order 23 of the Kano State High Court (Civil Procedure) Rules, 1988. On receipt of the said suit, the Appellants who were defendants at the Court below, filed notice of intention to defend the suit and an affidavit in support of the said Notice. After being served with the Appellant’s notice of intention to defend, the Respondent through its Area Manager, Mr. S.M. Kumer filed a further and Better Affidavit in support of the suit with some exhibits attached. There after, there were more affidavits from both sides each trying to undo the other on the facts leading to the suit. At the end of reading these affidavits, the learned trial judge entered judgment for the plaintiff/Respondent. Dissatisfied with the stance of the Court below, the Appellants filed notice of appeal containing four grounds on the 3rd day of June, 1999 challenging the said decision.
When this appeal came up for hearing on the 20th day of April, 2009, only Counsel for the Respondent C.A. Adolor Esq. was present to adopt his brief. Learned Counsel for the Appellants was absent. However, since all briefs were filed and exchanged and in keeping with Order 17, Rule 9(4) of the Court of Appeal Rules 2007, this appeal was deemed as duly argued.
In the brief prepared and filed by Abdullahi Ali Ozegya Esq. on behalf of the Appellants, two issues are formulated for the consideration of this appeal. The issues are:-
(1) Whether the Appellants have disclosed any defence and/or triable issues on the merit to warrant the suit being transferred from the undefended cause list to the General and/or ordinary cause list.
(2) Whether or not the Respondent can sue and/or maintain an action against the second appellant on a contract and/or transaction entered wholly by the First Appellant with the Respondent.
Two issues are also decoded by the learned counsel for the Respondent for the determination of this appeal. These are:-
(1) Whether or not the Defendants/Appellants gave or furnished particulars of fraud or proved the allegation of fraud as required by law. This issue is formulated from grounds b and c of the Appellant’s notice of appeal.
(2) Whether or not the Respondent can maintain an action against the 2nd Appellant or sue both 1st and 2nd Appellants jointly. This issue relates to ground d of the Appellant’s notice of appeal.
Before I venture to consider the issues submitted for the determination of this appeal, it is my observation while reading through the brief filed by the Respondent that he has given Notice of preliminary objection on page 4 of the brief and has gone ahead to argue same on pages 5 – 8 of the said brief. But as Counsel did not draw the attention of the court to it, it seems he has abandoned the said notice of preliminary objection. This is so because it was not moved by counsel. There is need to remind parties filing processes in court that the act of filing a process is different from arguing it in court. Where notice of preliminary objection is filed, counsel has a bounded duty to move it to enable the court rule on it one way or the other. Where notice of preliminary objection is filed but not moved in court, it is as good as not having been filed. In Nsirim Vs. Nsirim (1990) 3 N.W.L.R. (Pt. 138) 285 at 296 – 297, the Apex court, per Obaseki, JSC, stated the position as follows:-
“The respondent in the instant appeal has contended that although the objection was stated in the brief, the court was not moved at the oral hearing of the appeal to strike out the grounds for failure of particulars of errors. He therefore submitted that the appellant herein should be taken to have abandoned the objection. Moreso as it was not an issue for determination in the appeal before the court of Appeal.
In my opinion, there is substantial merit in the contention of the respondent. Being a preliminary objection, the objection should have been by motion or notice before the hearing of the appeal so that argument on it can be heard by the court. While notice of objection may be given in the brief, it does not dispense with the need for the respondent to move the court at the oral hearing for the relief prayed for.
This preliminary objection not having been raised and argued at the oral hearing, the Court of Appeal cannot be condemned as having erred in allowing the then appellant (now respondent) to argue his appeals.”
I will now refer to the oral hearing of this appeal and its proceedings which took place on the 20th day of April, 2009. The entire proceedings are as follows:-
” Adolor Esq.-The Respondent’s brief is dated 14th November, 2000, filed on 15th November, 2000 but deemed properly filed on 15th January, 2004. We adopt and rely on the said brief and urge the court to dismiss this appeal. We filed our brief in reaction to appellant’s brief dated 23rd August, 2000 but filed on 25th August, 2000.
Court: Judgment reserved to a date to be communicated to the parties.”
It is very clear from the proceedings of 20th April, 2009, that no mention was made about the notice of preliminary objection talk less of moving same. The notice of preliminary objection as already stated can be given in the brief as done in the instant appeal, but a party filing it in the brief must ask the court for leave to move the notice of objection before the oral hearing of the appeal commences. Failure to do this, the party will be deemed to have waived and abandoned the notice. See Oforkie Vs. Maduike (2003) 5 N.W.L.R. (pt. 812) 165, UPS Vs. Ufot (2006) 2 N.W.L.R. (Pt. 963) 1.
In the instant appeal, not having moved his preliminary objection at the hearing of this appeal, the respondent is deemed to have waived and abandoned same. This is so because notice of preliminary objection whether filed separately or incorporated in the brief is akin to an expression of intent by the respondent. Therefore, it must be specifically moved before the court for it to be considered. Else, it will be struck out. See Ariori Vs. Elemo (1983) 1 S.C.N.L.R. 13, Ajibade Vs. Pedro (1992) 5 N.W.L.R. (Pt. 241) 257.
Accordingly, notice of preliminary objection contained on page 4 of the Respondent’s brief is hereby struck out.
The coast is now clear for me to determine this appeal on the issues submitted for consideration. Although two issues have been submitted by each party for the determination of this appeal, it is my view that having regard to the facts and circumstance of this case, this appeal can and shall be disposed of on the 1st issue submitted by the parties.
The said issue for determination is whether the Appellants have disclosed any defence or triable issues on the merit to warrant the suit being transferred from the undefended list to the General or Ordinary cause list.
In his submission on this issue, the learned counsel for the Appellants opined that both the affidavit of the Respondent and the Appellants which show irreconcilable differences which can only be resolved by oral evidence to determine which of the parties should be believed ought to have guided the court below to have transferred the case to the ordinary cause list, citing the case of ACB Ltd Vs. Gwagwada (1994) 4 S.C.N.J. (Pt. 11) 268, Adkins Scientific Ltd Vs. Adedotoyimbo (1995) 7 S.C.N.J. 233.
Furthermore, that the Appellants in their various affidavits, Counter affidavits and further and better affidavits have disclosed triable issues on the merit and that they ought to have been given an opportunity to defend the suit. For example, that the Appellants raised the issue of fraud and gave particulars for which the court below ought to have allowed them to prove it and not to have held at that stage that the issue of fraud was not proved. That at that stage the appellants were not to prove fraud as an offence committed by the employee of the Respondent but only to state particulars of the fraud for the court to see whether it can afford the Appellants a fair defence to warrant the matter being transferred to the general cause list.
Learned Counsel further submitted that the 2nd appellant has raised in his affidavit that he is an illiterate and could not have understood some documents allegedly signed by him. Therefore, this calls for oral evidence to determine whether he signed those documents or not as issue of illiteracy is a question of fact to be decided objectively on the evidence presented to the court citing the case of Anaeze Vs. Anyaso (1993) 5 S.C.N.J. 151 at 166.
Finally, that the fact that the Appellants in their counter affidavit have set up a counter claim of N4 million naira against the respondent ought to have weighed on the mind of the Lower Court to transfer the case to the general cause list. Learned Counsel then urged the court to allow this appeal on the issue.
It was however the contention of the Learned Counsel for the Respondent that the Appellants failed to prove allegation of fraud made by them in their affidavit in support of notice of intention to defend. That for an imputation of fraud to succeed, it must be pleaded with the utmost particularity. That it must be distinctly alleged and proved and that it is not permissible to leave fraud to be inferred from the facts relying on the cases of Onamade Vs. ACB Ltd (1997) 1 N.W.L.R. (Pt. 480) 123, Tor Tiv Vs. Wombo (1996) 9 N.W.L.R. (Pt. 471) 161 and Usenfowokan Vs. Idowu (1969) 1 N.W.L.R. 77.
Learned Counsel further submits that a party wishing to defend an action filed under the undefended list by attempting to put up a defence relating to fraud allegedly committed by the plaintiff, should state the particulars of fraud in his counter affidavit. That a mere vague allegation of fraud is useless. He cites and relies on the cases of Diamond Bank Vs. GSM Agro Allied Ltd (1999) 8 N.W.L.R. (Pt. 616) 558 and Nishizawa Ltd Vs. Jethwani (184) 12 S.C., 234. He then urged this court to hold that the Lower Court was right in refusing to transfer the suit to the general cause list as the Appellants failed to prove the fraud alleged.
The procedure under Order 23 of the High Court (Civil Procedure) Rules 1988 of Kano State is that whenever application is made to a Court for the issuance of a writ of summons in respect of a claim to recover a debt or liquidated money demand and such application is supported by an affidavit setting forth the grounds upon which the claim is based, and stating that in the deponent’s belief, there is no defence thereto, the court shall, if satisfied that there are good grounds for believing that there is no defence thereto enter the suit for hearing in what is called the “Undefended List” and mark the writ of summons accordingly, and enter therein a date for hearing suitable to the circumstance of the particular case.
Under Order 23 Rule 3 thereof, to succeed in getting a matter under the undefended list transferred to the general cause list for full blown trial necessitating the settlement of pleadings and calling witnesses, the affidavit in support of the notice of intention to defend must disclose a defence on the merit. In summary, the procedure may be stated thus:-
The plaintiff must take the following steps –
(a) Make an application to the court for the issuance of a writ
(b) Support the application with an Affidavit and
(c) State in his affidavit that in his belief the defendant has no defence to the action.
When the plaintiff has fulfilled these conditions, the court shall-
(a) Satisfy itself that there are good grounds for believing that there is no defence to the claim
(b) Enter the suit for hearing on the undefended list and
(c) Mark the writ of summons with the words “Undefended List” and enter on it a date for hearing as is suitable in the circumstances of the case.
A defendant served with the said writ, together with the plaintiff’s affidavit and he intends to defend the action, must-
(a) File a Notice in writing, not less than 5 days before the hearing date fixed by the court that he intends to defend the action.
(b) Accompany the Notice with an affidavit disclosing a defence on the merit
In such affidavit in support of Notice of intention to defend, the defendant must show that there is a dispute between the parties. The undefended list procedure is to enable a plaintiff to obtain summary judgment without going into lengthy trial if he can prove his claim clearly and also if the defendant is not able to set up a bona fide defence or raise an issue against the claim which ought to lead to the case being tried on its merit. See Federal Military Governor Vs. Sani (1990) 4 N.W.L.R. (Pt. 147) 688, Sodipo Vs. Lemninkainen O.Y. & Anor (1989) 1 N.W.L.R. (Pt. 15) 220, UTC Vs. Pamotei (1989) 2 N.W.L.R. (Pt. 103) 244.
The intension of the procedure is not to shut out the defendant. Rather, it gives him the opportunity to show by his affidavit that it has a defence which ought to be considered by the trial Court.
It is the duty of the trial judge to examine the averments of the defendant in his affidavit in support of notice of intension to defend in order to ascertain whether the defence set up therein is meritorious or not as there is no room for frivolities. In doing this, it is not for the trial judge to consider at that stage whether the defence has been proved. He is simply to look at the facts deposed in the defendant’s affidavit and see if these facts can, prima facie afford a defence to the claim. At that stage, a complete and comprehensive defence need not be shown. It is enough that the defendant is able to show that there is a triable issue or question raised in the affidavit. And before judgment can be entered for the plaintiff, the trial Judge must satisfy himself that all the facts contained in the defendant’s affidavit do not amount to a defence in law.
In the instant case, the Appellants raised the following issues in their affidavit in support of notice of intention to defend to wit –
(1) Fraud against the Respondent’s employees.
(2) That the 2nd Appellant is an illiterate and could not have signed documents tendered as exhibits by the Respondent
(3) The Appellants alleged that the Respondent was owing them the sum of N4million naira
(4) The issue of diverted way bills.
Now the relevant paragraph of the affidavit in support of Notice of intention to defend state –
“3 – (a) That Abunuhu Nigeria Ltd (hereinafter referred to as “The Company”) is a Limited liability company registered under Nigerian Law with offices in Jos and other town in Nigeria.
(b) That there is no person both in the employment and the directorship of the company known as Alhaji Abubakar Mohammed, sued as 2nd defendant in this suit.
(c) That the company has been doing business of tyres with the plaintiff for sometime now
(d) That the plaintiff at all material time to this suit was having one Mr. Simeon Uwa Nicholas as its employee through whom usually the company used to channel its requisition for tyres.
(e) That paragraph 3a to 4 of the plaintiff’s affidavit in support of undefended list is denied by the defendant.
(f) The period within which the plaintiff entered into business transaction with the Company is from October 1996 – July, 1998.
(g) That the company recently detected that when consignments of tyres are sent from the plaintiffs office in Kano the said employee of the plaintiff Mr. Simeon Uwa Nicholas used to take the delivery of such consignment unto himself to the detriment of the company.
(h) That the company intercepted copies of some of the way bills accompanying diverted consignments when it started suspecting the plaintiff and its employee of fraud against it.
(i) That some of the way bills have invoice attached thereto and the company drew the attention of the plaintiff to the activities of the plaintiff s employee and supplied copies of such documents to the plaintiff. Copies of way bills and invoice sent to the company from the plaintiff accompanying tyres which were diverted by the plaintiff fraudulently and sold in Lafia, Nassarawa State are attached hereto and marked as Exhibits A and B respectively.
(j) That in some transactions the company made payments for tyres delivered to it in cheques and sometimes in cash and in some other times it paid in cash and in cheques to the plaintiff through its employee afore said. Attached hereto and marked as Exhibit “C” is an invoice where payment in cheques and cash were made to the plaintiff through its aforesaid employee which were found not to have been remitted to the plaintiff by the employee.
(k) That Exhibit “C” was drawn to the attention of the plaintiff by the company.
(l) That when these frauds of the plaintiff appeared to the (sic) be too much on the company it (the company) consulted a financial expert based in Jos by name Alhaji Ishaq Idris to reconcile the plaintiffs accounts respecting its transactions with the company.
(m) That Exhibit A3 attached to the plaintiffs affidavit is not written or signed by Alhaji
Muhammad Abubakar.
(4) That I have been informed by Alhaji Ishaq Idris, a financial expert based in Jos while briefing A.A. Sangel Esq Counsel on 18th October, 1998 at 4.30pm in Doka Chambers Jos and I verily believe his information to be true as follows:
(a) He, my informant was instructed by Abunuhu Nigeria Ltd to compare and recognize reconcile its accounts with plaintiff whereupon he investigates the way bills/invoice and other documents relating to the transactions between the plaintiff and the company in Jos and Kano and it was jointly discovered that there is fraud in this transactions which led to the prosecution of Mr. Simeon Uwa Nicholas in Chief Magistrate Court 3 Kano in case No KA/7303/97 – Cop Vs. Simeon Uwa Nicholas for defrauding the plaintiff.
(b) The record of proceedings and exhibits in this case will be made available to this honourable court at the trial.
(c) The financial expert along with the plaintiff discovered there were about 29 way bills which ought to have accompanied tyres for delivery for the company and such tyres were not delivered to the company.
(d) That some of the way bills include way bill No 100546 which has the value of over 2 million naira.
(e) That Alhaji Ishaq Idris requested the plaintiff to make copies of such way bills available to the company and Mr. Kumar snatched the way bills and promised to make same available to the company which promise up till now is not fulfilled.
(f) That from the investigation of Alhaji Ishaq Idris the plaintiff will refund over N4million Naira to the company whenever proper scrutiny of accounts between the parties are conducted.
(g) Alhaji Muhammad Abubakar is not literate in English language … ”
After the Appellants filed the above affidavit, there followed an avalanche of counter affidavits, further affidavit, further and better affidavits, further counter affidavits, each party hoping to undo the other on the number of affidavits filed. In view of these conflicting affidavits the learned trial judge on page 21 of the record, ordered the parties to go home and reconcile the way bills and delivery notes which were doubtful to them. The court also on the same page –
“gave them 3 weeks so that they could meet discuss, examine and compare notes with the plaintiffs so that they may come up with their figures of payments/Debts, but they failed to bring any figure after three weeks”
The learned trial judge further ordered them to go back and “meet, discuss and compare notes” before the date of judgment. When the parties failed to “meet, discuss and compare notes” and come up with an acceptable figure, the court below entered judgment for the plaintiff (now Respondent) anchoring his judgment mainly on the fact that the appellants failed to prove allegation of fraud. This is what the learned trial judge said on page 25 of the record –
“In fact even if the defendants have shown the elements of fraud, they must prove it like an offence beyond reasonable doubt. There is not proper substantiated allegation of fraud and the court cannot transfer the case to the general cause list on this ground.”
With due respect to the learned trial judge, he completely missed the point here. At the stage which the court below decided the case in favour of the Respondent, the Appellants were not expected to prove fraud beyond all reasonable doubt. The law only requires them to give particulars sufficient enough which would reasonably afford the Appellants a defence and of course not just a mere vague allegation of fraud and/or general statement of allegation of fraud. See Diamond Bank Nigeria Ltd Vs. GSM Agro Allied Ltd (1999) 8 N.W.L.R. (Pt. 616) 558.
My view is that even without making reference to any other affidavit filed by the Appellants in the course of the trial at the court below, the facts contained in the affidavit in support of Notice of intention to defend discloses more than sufficient particulars to have weighed in the mind of the learned trial judge to transfer the case to the general cause list. Come to think of it, the allegation of fraud against Simeon Uwa Nicholas, an employee of the Respondent; the alleged fraudulent way bills attached as Exhibits A and B, the fact of his conviction by the Magistrate’s Court for fraud, the employment of a named financial expert to reconcile the accounts between the Appellant and the Respondent, the discovery by the expert of fraud of N2 million Naira in one swipe and the counter claim of N4 million Naira against the Respondents. What further particulars did the court below look for? The Appellants even gave the charge number and the court which convicted the said employee of the Respondent. There is nothing to show that the Respondent denied this fact that one of its employees committed fraud against the Appellants which made them to lose millions of naira. I state with great sense of responsibility that the Appellants provided enough particulars of fraud in the circumstance.
Let me emphasize here that it is not the duty of the trial court while considering an action under the undefended list procedure to determine at that stage whether the defence will succeed ultimately. In determining whether the defendant has disclosed a good defence on the merit or whether he has disclosed such facts as may be deemed sufficient to allow him to defend the suit; it is not necessary for the trial court to consider whether the defence has been proved as was the case in the court below. What is required at this stage is simply to look at the facts deposed and see if they can prima facie afford a defence to the action. A complete defence as held by the court below need not be shown at that stage. It is enough if the defence so put up shows that there is a triable issue or that for some other reason, there ought to be a trial: See Fesco Nigeria Ltd Vs. Nasco Rice & Cereal Processing Company Ltd (1998) 11 N.W.L.R. (Pt. 573) 227.
The Apex court had admonished in Adebisi Macgregor Associates Ltd Vs. Nigeria Merchant Bank Ltd (1996) 2 S.C.N.J. 72 at 82 that-
“As a general principle, where a defendant shows that he has a fair case for defence, or reasonable grounds for setting up a defence, or even a fair probability that he has a bona fide defence, he ought to have leave to defend.”
I think it is only fair and just to adhere to this admonition. It is now also a well established principle that when a Court is proceeding under the undefended list proceeding, it is desirable that the Court must call to play a measure of liberality when viewing the affidavit of the Defendants in order to determine whether or not a defence on the merit is disclosed. See Ebong Vs. Ikpe (2002) 17 N.W.L.R. (pt. 797) 504, Bawa Vs. Phemas (2007) 4 N.W.L.R. (Pt.1024) 251.
Had the learned trial judge adverted his mind to these admonitions, he would not have come to this grave error.
Before I am done, let me say a few words on the avalanche of affidavits and counter affidavits filed in this case at the court below. Both the affidavit evidence of the Respondent and that of the Appellants show an irreconcilable differences which can only be resolved by oral evidence being adduced to determine which of the parties is to be believed. I note that the matters which the learned trial judge attempted to resolve were not only crucial issues but also irreconcilable in both affidavits which called for resolution by adducing oral evidence. Where a court as in this case, is faced with conflicting and irreconcilable affidavits, oral evidence should be taken to determine the truth. See Adkins Scientific Ltd Vs. Adadetoyinbo (1995) 7 S.C.N.J. 23.
The issue of illiteracy raised by the Appellants in their affidavit is also important as documents allegedly signed by the 2nd Appellant, which he denies, are also crucial to the determination of the suit. The Supreme Court has held in Anaeze Vs. Anyaso (1993) 5 S.C.N.J. 151 that the issue of illiteracy is a question of fact to be decided objectively on the evidence presented to the Court. It was therefore wrong for the court below to gloss over it. So also the issue of the counter claim of the Appellants against the Respondent. It was a real triable issue which ought to have been given a chance.
On the whole, I think the Appellants clearly made out or disclosed a defence on the merit and also raised triable issues which ought to have tilted the scale of justice in their favour for the court below to have transferred the suit to the general cause list for hearing by calling oral evidence. That effort by the learned trial judge to resolve the conflicting and irreconcilable affidavits by a fiat was, with due respect against the spirit and tenets of Order 23 of the Kano State High Court (and Procedure Rules) 1988. Accordingly, the only issue adopted for the determination of this appeal, is hereby resolved in favour of the Appellants.
At this stage, it will be preemptive for me to attempt to resolve the second issue since it is one of the issues to be determined by the trial Court. The claim of the plaintiff will determine who and who are the parties and who are not.
In sum, this appeal is meritorious and is hereby allowed. The judgment of the learned trial judge delivered on 2nd June, 1999 is hereby set aside and in its place, I hereby order that the Respondent’s suit filed at the Lower Court be removed from the undefended list and transferred to the general cause list for trial before another judge of the Kano State High Court.
In view of the facts of this case, both parties are to bear their respective costs.
Other Citations: (2009)LCN/3326(CA)
