African Continental Bank Limited & Anor V. A. O. Awogboro & Anor (1990)

LawGlobal-Hub Lead Judgment Report

ADEMOLA, J.C.A.

This is an appeal against the interlocutory injunction granted by Olorunnimbe, J., sitting in the Lagos High Court, Ikeja Division in this matter, on the 13th January, 1986.

The 1st plaintiff/respondent was mortgagor to the 1st defendant/appellant. The 1st appellant had advanced money to the 1st respondent for his business and the 1st respondent has defaulted in the payment of the total amount owing standing now a little over a Million Naira. Whereon, the 1st appellant instructed the 2nd defendant an Auctioneer to sell the house which is the subject-matter of the mortgage, thereby exercising his power of sale under the Mortgage Deed to sell the property No. 27 Onayade Street, Ikorodu, Lagos.

The second respondent brought a motion restraining the defendants from selling the house; claimed an interest in the house in that the house is also her residence and that of her children as well as the 1st respondent who is her husband.

The learned trial Judge after listening to the parties made an interlocutory injunction restraining the Auctioneer that is the 2nd defendant and the 1st appellant from selling the property.

The appellants have appealed to this court against the Order so made. The appellants have set out the questions for determination in the brief filed as follows:-

(1) Whether on the affidavit evidence before the learned trial Judge, the plaintiffs had established any of the criteria known to law in Nigeria for grant of interlocutory injunction.

(2) Whether the learned trial Judge was right in declaring that there was a triable issue and that that was a basis for granting interlocutory injunction, without reviewing and evaluating the affidavit evidence before him and without even identifying the said triable issue.

(3) Whether the trial Judge was right in dealing with the question of balance of convenience and pronouncing thereon when the plaintiffs had not fulfilled the condition precedent of making out a prima facie case that they were entitled to the right of whose violation they complained.

(4) Whether in any event the learned trial Judge was right in exercising his discretion in favour of granting the interlocutory injunction despite the delay and lack of diligence on the part of the plaintiffs in prosecuting the same, after having obtained an interim injunction against the defendants.

The respondent has also filed a brief and set out the issues for determination in the following way:-

“The respondents submit that the issues for determination in this appeal are:-

Did the learned trial Judge correctly exercise his discretion judicially in granting respondents Interlocutory Injunction on the facts reported after a careful and painstaking appraisal of the 4 Affidavits presented by the parties to this appeal?

Did the conduct of the respondent show that the application for interlocutory injunction was not pursued diligently?”

Mr. Ezeobi learned Counsel for the appellant relied on his brief during the hearing of this appeal. In the brief filed on behalf of the appellant, the point was made that the property is owned by the 1st and 2nd respondents in the writ whereas in the mortgage deed on the property, the registered owner and the sole proprietor of the free-hold is shown to be the 1st respondent. The charge created which is Exhibit ‘A’ only bears the name of the 1st respondent. The appellants contended that made no caution notice was filed when Exhibit ‘A’ was being registered. Learned Counsel said that these facts were canvassed before the learned Judge, but the learned Judge did not review or evaluate these facts, but went on to say in his ruling that he would not take into account at this stage those facts stated in the counter-affidavit in opposition to the respondents claim for an injunction. The appellants brief dealt with the many pleaded cases on injunction, particularly where the Supreme Court has granted injunctions or have directed that injunctions should be granted where those circumstances were present. I need not set out those well known cases as they are sufficiently set out in the brief of the appellant. It is sufficient for me to say that the appellant submitted that if the Judge had evaluated the contents of the affidavit he would have come to the conclusion that the endorsement on the writ of summons are in conflict with the registered legal mortgage in Exhibit ‘A’. That the 1st appellant as the Mortgagee under the legal charge and in bona fide exercise on his right can sell the property advertised. That the right to a notice of a sale is entirely waived under the Mortgage Deed and that in this case several notices have been sent to the plaintiff before the Auctioneer was told to put the notice to sell.

It was also said that the Judge would have found out on the counter-affidavit before him and the document attached to it that the’1st respondent is the sole registered proprietor entitled to the mortgaged property. That the 1st respondent sole ownership of the mortgage property was not challenged by the 2nd respondent. The brief then discussed the legal right of the unpaid mortgagee to sell the property.

The brief also criticized the learned Judge’s application of the case of Ladunni v. Kukoyi (1972) 3 S.C.31 to the facts of this case, and that the consideration as to whether there were triable issues before the grant of interlocutory injunction belong properly to the proceedings under Order 10 procedure of the Lagos High Court rules and not to granting of injunction. All the applicant needs to do is to show and satisfy the court that there is a serious question to be tried on the hearing and not triable issues as used by the learned trial Judge. The brief criticized the learned trial Judge’s conclusion on the balance of convenience being in favour of the respondent in this case.

Finally, in the brief it was submitted that the conduct of the applicants by asking for adjournment before the hearing of the motion for injunction and after the grant of the injunction was to delay the hearing of case and that their conduct should have been taken into account before the grant of the injunction.

As stated earlier in this judgment, the respondent filed a brief. In it he argued that as a guarantor in a Mortgage Deed he has a right to ensure that the mortgagee in exercising his power to sell must keep strictly to the terms and conditions on the Mortgage Instrument. This is what 1st respondent is seeking to do in instituting this action. The counter-affidavit of the appellant raised so many issues which need looking into. In the brief it was argued that if the house is sold and the respondent succeed in showing that he as a guarantor had been saddled with debt not contracted under the mortgage instrument due to unauthorised merger of account outside the mortgage contract, the respondent is entitled to know the correct amount if any under the mortgage instrument. The respondent also has a right under the conditions of the mortgage that the terms of it are not violated by the mortgagee. All these are the legal rights of the 1st respondent which the action prima facie brings out and would need to be determined during the trial. These are matters upon which the Judge is entitled to come to the conclusion that serious legal issues ought to be tried or investigated during the trial and until this is gone into an applicant for an interlocutory injunction who raises these matters is entitled to the grant of an interlocutory injunction. The respondents

brief contended that the learned Judge was right upon a proper appraisal of all the facts presented both in the affidavit and counter-affidavit to come to the conclusion thus:

“On the whole, I am satisfied on the Affidavit evidence before me that the plaintiff/applicant has shown sufficient reasons to enable me exercise my discretion in their favour.”

The case of Commissioner for Works, Benue v. Devcon Limited (1988) 3 NWLR (Pt.83) page 407 at 422-423 supports the finding of the judgment.

It was also contended in the brief that if the house is sold before the trial the case of the respondents would have disappeared in that the object of the action is that the house should not be sold. In other words, it means his legal right would have been destroyed. The subject matter of the action would also be destroyed.

The respondent contended that it is not correct that the adjournments had been at the instance of the respondents and gave instances of cases where the adjournment had been at the request of the appellants and also at the instance of the court below. Therefore the charge of delay by conduct of the respondents does not arise in this case. The Judge granted an accelerated hearing of the case; the respondents had filed their statement of claim. Whereas the appellant are still to file their own statement of defence. Instead of the appellant getting on with the case he decided to appeal. The charge of delay cannot therefore be made at the door of the respondents in this case.

The respondent ended his argument by saying that the Judge was right in not asking respondent to give an undertaking while granting the interlocutory injunction because the property in question is sufficient undertaking which the appellant could have if he wins the action.

In my view what remains to be determined in this appeal falls within a narrow compass. If the Judge were to resolve the issues raised in the appellant counter affidavit as urged by Mr. Ezeobi in his argument in the brief and in the oral argument before this court, he would in my opinion have tried the issue prematurely which later on he will be called upon to do. The Judge is right to say as he did say. “At this stage the court is not concerned with the writ of summons and the statement of claim if any had been filed.”

The Judge also was right in saying that he is satisfied that there are triable issues in this matter; and for saying that if No.27 Onayade Street is sold and ultimately the applicant succeeds there can be no return to status quo and that respondent would have suffered irreparable damage. It was a case in which interlocutory injunction ought to be granted. Obeya Memorial Hospital v. A-G., Federation & Anor. (1987) 3 NWLR (Pt.60) 325 at 328-340.

I am also of the view that the Judge was right in not asking the applicant for an undertaking because in the view of the Judge, the property of the plaintiff is still in the legal possession of the appellant and if the appellant were to win no damage would have been suffered by the appellant during the pendency of the interlocutory injunction.

On the whole this appeal fails and it is hereby dismissed with cost in favour of the respondent which I assess at N350.00.

Other Citations: (1990)LCN/0105(CA)