A PLC. V. Uba PLC. In the Court of Appeal of Nigeria (2006)
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RHODES-VIVOUR, J.C.A.
This is an appeal from the decision of the High Court of the Federal Capital Territory, Abuja Coram: Kusheriki J. in the ruling in Suit No. FCT/HC/CV/130/02 delivered on the 12th of November, 2002.
The facts of this case are rather straight forward. The appellant awarded a contract to Elecktrint Nig. Ltd. (hereinafter called the contractor). The contractor was to do some work on the appellant’s office in Abuja. The appellant demanded from the contractor:
(a) An advance payment guarantee, and
(b) A performance bond.
The respondent produced both, dated 27/9/01 and 1/12/2000 respectively, and entered into a collateral contract with the appellant on behalf of the contractor; its customer to pay on first demand to the appellant the sums stated therein in the unlikely event the contractor failed to carry out the contract. There was disagreement between the contractor and the appellant, and so the contractor filed suit no.LD/284512001 at the Lagos High Court. He sued the respondent as 1st defendant and the appellant as 2nd defendant. The contractor’s claims are as follows:
“i. A declaration that the 1st defendant is not liable to make any payment to the 2nd defendant under, pursuant to, or by virtue of the advance payment guarantee dated 27/9/2001 and or the performance bond dated 1/12/2000.
ii. A declaration that the letter of demand dated 15th of November issued by the 2nd defendant to the 1st defendant is fraudulent, defective and invalid consequently null and void.
iii. A declaration that the plaintiff not having received an advance payment subsequent to the issuance of the advance payment guarantee on the 27th of September 2001 is not liable to indemnify the 1st defendant against any sum of money paid or to be paid by the 1st defendant to the 2nd defendant under, pursuant to, or by virtue of the said advance payment guarantee.
iv. An order of injunction restraining the 1st defendant (UBA Plc.) from making any payment to the 2nd defendant (Dumez) pursuant to, under or by virtue of the advance payment guarantee dated the 27th September 2001 and or the performance bond dated the 1st of December 2000.
v. An order of injunction restraining the 1st defendant from debiting the plaintiff’s bank account held at any of the 1st defendant’s branch office or making any claim against the plaintiff, for any sum of money paid or to be paid by the 1st defendant under, pursuant to, or by virtue of the advance payment guarantee entered into between the 1st and 2nd defendants dated 27th September, 2001 and the performance bond dated 1st of December, 2000.
vi. An order of injunction restraining the 2nd defendant from receiving any payment from the 1st defendant pursuant to, under or by virtue of the advance payment guarantee entered into between the 1st and 2nd defendants dated 27th of September 2001 and the performance bond dated 1st December, 2000.
vii. A sum of N3,000,000.00 (three million naira) damages against the 2nd defendant for wrongful termination of the contract between the plaintiff and the 2nd defendant dated 22nd of November, 2000.”
This action was subsequently discontinued against the appellant (the 2nd defendant) and its name was struck out. The appellant then filed suit no.FCT/HC/CV/130/02 in Abuja. It sued only the respondent.
Meanwhile suit No. LD/2845/01 in Lagos is still pending.
Learned counsel for the respondent filed a motion before the Abuja High Court seeking an order striking out the writ of summons and statement of claim in suit No.FCT/HC/CV/130/2002 between the parties for being an abuse of process.
After listening to counsel D.M. Kusheriki J. ordered that the case be transferred to be consolidated with LD/2845. His Lordship’s reasoning was that the subject matter before both courts are one and the same thing.
This ruling did not go down well with the appellant. He appealed by filing notice of appeal on 24/3/02. Four grounds of appeal are contained in the notice of appeal. They are without their particulars:
“Ground one
The learned trial Judge erred in law when he ordered the transfer of the suit before him for consolidation with the one in the Lagos High Court.
Ground two
The learned trial Judge erred in law when he held …
“although the plaintiff’s name had been withdrawn from the case in Lagos but from the records, the order of injunction affect all the parties…. ”
Ground three
The learned trial Judge erred in law when he held that the subject matter is the same in both the suit pending in Lagos and the one before him.
Ground four
The learned trial Judge erred in law in ordering the transfer and consolidation of the suit with that of Lagos.”
In accordance with the mandatory requirement in Order 6 rule 2 of the Court of Appeal Rules 2002, learned counsel for the appellant filed the appellant’s brief on the 4th of April 2003 but was not served on the respondent until the 28th of January, 2004.
The respondent’s brief was filed on the 11th of March 2004, four days short of the forty five days allowed for filing the respondent’s brief. See Order 6 r. 4(1) of the Court of Appeal Rules 2002.
Learned counsel for the appellant distilled three issues for determination. They are:
“1. Whether the learned trial Judge has jurisdiction to order the transfer and consolidation of the suit with that in Lagos.
- Whether the trial Judge was right in holding that the suit was an abuse of court process.
- Whether the trial court was right in granting a relief not asked for by the respondent.”
Learned counsel for the respondent adopted the appellant’s issues 1 and 3 and in addition formulated an issue which reads as follows:
“Whether having regard to the substance of the claims in suit no.LD/2845/01 pending before the High Court of Lagos State the subsequent institution of suit No.FCT/HC/CV/130/02 before the High Court of the Federal Capital Territory, Abuja by the plaintiff/appellant constitute an abuse of process of court.”
At the hearing on the 2nd of February, 2006 the appellant was absent and unrepresented. Learned counsel for the respondent adopted his brief and urged us to dismiss the appeal.
The issues formulated by the parties would determine the real grievance in this appeal. There would thus be no need for me to formulate issues. I adopt them but for easy understanding I shall address the issues as follows:
Issue one
“Whether having regard to the substance of the claims in suit no. LD/2845/01 pending before the High Court of Lagos State the subsequent institution of suit No: FCT/HC/CV/130/02 before the High Court of the Federal Capital Territory, Abuja by the plaintiff/appellant constitute an abuse of process of court.”
Learned counsel for the appellant argued that since the appellant’s name was struck out from the suit – Lagos, the appellant was free to sue the respondent in Abuja. He observed that the two suits are not the same as the appellant’s claim against the respondent is based on the advance payment guarantee and performance bond contract, while the suit in Lagos is based on a contract between the respondent and Elecktrint Nig. Ltd. (the Contractor).
Concluding he submitted that the suit in Abuja is not an abuse of process. Reliance was placed on: Yakubu v. Ajaokuta Steel Co. (2002) 10 NWLR (Pt.774) p.115.
Replying, learned counsel for the respondent observed that the claims before both courts reveals the issue to be the liability of the respondent to pay the appellant in respect of the advanced payment guarantee and the performance bond, contending that to institute an action during the pendency of another one claiming the same reliefs amounts to an abuse of the process of court. Reference was made to: Nweke v. Udobi (2001) 5 NWLR (Pt.706) p.455; Morgan v. West African Automobile and Engineering Co. Ltd. (1971) 1 NMLR p.219.
Abuse of process is a term generally applied to a proceeding which is wanting in bona fide, and it is frivolous, vexatious and oppressive. It also means the improper use of the legal process. See Okafor v. A.-G., Anambra State (1991) 6 NWLR (Pt.200) p.659; Aruba v. Aiyeleru (1993) 24 NSCC (Pt.1) p.255, (1993) 3 NWLR (Pt.280) 126; 7Up Bottling Co. Ltd. v. Abiola & Sons Bottling Co.Ltd. (1996) 7 NWLR (Pt.463) p.714. The issue in suit No. LD/2845/01 and suit No: FCT/HC/CV/130/02 is whether the respondent is liable to the appellant in respect of the advance payment guarantee dated 27/9/2001 and performance bond dated 1/12/2000. The well settled position of the law is that where as in this case the action in suit no. LD/2845/2001 and suit no. FCT/HC/CV/130/02 are pending between the same parties and arise out of the same subject matter and are actions in which common questions of law and fact arise or the alleged right to relief are in respect of or arise out of the same transaction or series of transactions, the suit filed later in time would be vexatious and an abuse of process. The rule is that where matters involving the same issues are raised contemporaneously in two different courts, it is desirable and clearly in the interest of justice that these matters should be heard in only one of these two courts.
It is designed to avoid multiplicity of proceedings. The basis of the rule is the real possibility of two conflicting decisions in respect of one and the same subject matter. In such a situation, it is desirable that the issues common to both matters are tried in only one court.
See Royal Bank of Scotland v. Citrusdal Ltd. (1971) 1WLR p.1472; Hughes King Nig. Ltd. v. Harris 3 LRN p.194; Okorodudu v. Okoromadu (1977) 11 NSCC p. 105, (1977) 3 SC 21.
There is therefore no doubt that in suit No. FCT/HC/CV/130/02, the appellant seeks an order of court to compel the respondent (UBA Plc.) to pay the sums under the advance payment guarantee and performance bond, while in suit No.LD/2845/2001 the plaintiff (contractor) on whose behalf the respondent promised to pay sues for a restraint on payment.
It is so obvious that suit Nos. LD/2845/2001 and FCT/HC/CV/130/02 have the same subject matter, issues and parties. The proper course for the appellant would be to file defence and counterclaim in suit no. LD/2845/2001 rather than file a new suit, FCT/HC/CV/130/02. The filing of FCT/HC/CV/130/02 amounts to an abuse of process and if allowed to go on while suit no. LD/2845/2001 is also in progress there is real possibility of two conflicting judgments with litigants at liberty to accept the judgment favourable to them. A state of anomie may arise and that would be most unfortunate. The trial Judge was right to stop further proceedings in suit No. FCT/HC/CV/130/02.
Once a Judge is aware of a case in his, or another jurisdiction on the same subject matter as the one before him such a situation calls for caution. Nowadays this is common and Judges should not allow it to occur. If they do and proceed with the trial as if all is well, there is the real likelihood of two conflicting decisions at the end of trial – which would end up polluting the streams of justice which ought to be kept pure at all times.
Issue two
Whether the trial court was right in granting a relief not asked for by the respondent.
Learned counsel for the appellant observed that the respondent never asked for a transfer of the suit to Lagos.
He submitted that the Judge was wrong to make an order which was not pleaded or prayed for by the respondent. Reliance was placed on: Fabiyi v. Adeniyi (2002) 5 SCNJ p. 1, Fabiyi v. Adeniyi (2000) 6 NWLR (Pt. 662) 532; Abu v. Kuyabana (2002) 4 NWLR (Pt.758) p.599.
Opposing, learned counsel for the respondent observed that in moving the motion learned counsel prayed the court that the matter be consolidated with the one in Lagos High Court. Reference was made to page 61 of the record of proceedings.
Concluding, he submitted that the reliefs could have been granted under the omnibus ground.
The respondent’s motion brought under Order 47 rule 1 of the civil procedure rules of the High Court of Federal Capital Territory was for:
“An order striking out the writ of summons and statement of claim in suit No. FCT/HC/CV/130/2002 between the parties herein for being an abuse of the court process. And for such further or other order as the honourable court may deem fit to make in the circumstances.”
At the hearing, learned counsel for the respondent asked that in the alternative the matter should be consolidated with the suit pending in Lagos.
Once the court is satisfied that a suit is an abuse of process it has inherent jurisdiction to stay, strike out or dismiss the proceedings. The power is discretionary and should be sparingly exercised only in exceptional cases. See: Onyeabuchi v. INEC (2002) 4 SC (Pt.11) p.39; (2002) 8 NWLR (Pt. 769) 417.
In my view, the question is whether the trial Judge exercised his discretion properly and not whether he granted a relief not asked for bearing in mind that the power to strike out or dismiss the offending suit should be sparingly exercised.
This is a situation where a consequential order was made to give effect to the ruling. The trial Judge was of the view that the only way the ends of justice could be met was by a consolidation of suit no.FHC/HC/CV/130/02 with suit No. LD/2845/01.
Whether the trial Judge had the jurisdiction to order the transfer and consolidation of the suit with that in Lagos is the only issue left to be considered.
Issue three
Whether the learned trial Judge has jurisdiction to order the transfer and consolidation of the suit with that of Lagos. Learned counsel for the appellant observed in his brief that under statutory and procedural laws a Judge has no power to transfer a suit from one state to another, contending that Lagos and Abuja being two distinct and separate states the learned trial Judge has no jurisdiction to make the order. Relying on: Dairo v. U.B.N. Plc. (2000) 16 NWLR (Pt.739) p. 495; Ndaeyo v. Ogunnaya (1977) 1 SC p.11.
Concluding, he submitted that the order is incompetent, unconstitutional, null and void.
In reply, learned counsel for the respondent argued that the trial Judge was right and acted within his inherent jurisdiction when he held that for the matter to be treated judiciously and judicially the cases should be consolidated and tried as one.
Section 22(2) of the Federal High Court Act, Cap.134 reads as follows:
“(2) No cause or matter shall be struck out by the court merely on the ground that such cause or matter was taken in the court instead of the High Court of a State or of the Federal Capital Territory, Abuja in which it ought to have been brought, and the Judge of the court before whom such cause or matter is brought may cause such cause or matter to be transferred to the appropriate High Court of a State or of the Federal Capital Territory, Abuja.”
Learned counsel for the appellant was wrong in his submissions when he said in his brief that under statutory and procedural laws a Judge has no power to transfer a suit from one State to another. By virtue of section 22(2) of the Federal High Court Act, Cap 134 a Judge of the Federal High Court has power to transfer a suit from one State to another.
In this case, the trial Judge is a Judge of the High Court of the Federal Capital Territory and not a Judge of the Federal High Court. The applicable Legislation is the High Court of the Federal Capital Territory Abuja Act, Cap 510, Laws of the Federation of Nigeria, 1990. Nowhere in Cap 510 is there a provision similar to Section 22(2) of Cap. 134. Accordingly, the trial Judge was wrong to order the transfer and consolidation of the suit in Abuja with the suit in Lagos.
To my mind issues 2 and 3 in this appeal are no longer live issues in view of my findings on Issue No. 1. The orders made by the Judge do not in any way change or improve the appellant’s case.
Since the trial Judge found and quite rightly too that suit No: FCT/HC/CV/130/02 is an abuse of court process and would not be allowed to proceed, issues 2 and 3 fade into insignificance. The proper order to make as regards suit No. FCT/HC/CV/130/02 would have been to dismiss it.
In Arubo v. Aiyeleru (1993) 24 NSCC (Pt.1) p.275, (1993) 3 NWLR (Pt. 280) 126, Hon. Justice Nnaemeka Agu JSC (as he then was), citing Wills v. Earl of Beauchamp (1886) 11 probate 59, said:
“Once a court is satisfied that any proceeding before it is an abuse of process it has the power, indeed the duty, to dismiss it…… to invoke its coercive powers to punish the party which is in abuse of its process. Quite often that power is exercisable by a dismissal of the action which constitutes the abuse.”
The trial Judge was right to conclude that suit No.FCT/HC/CV/130/02 is an abuse of process. His Lordship was wrong, though to order the transfer and consolidation of suit No. FCT/HC/CV/130/02 with suit No. LD/2845/01 since the Cap.510 Laws of the Federation of Nigeria 1990 gives him no such power.
In conclusion, I affirm the decision of the trial court that suit No.FCT/HC/CV/130/02 is an abuse of the process of the court.
Appeal is hereby dismissed with N5,000 costs to the respondent.
Other Citations: (2006)LCN/2148(CA)
