Aprofim Engineering Construction Nigeria Limited V. Sidov Limited (2005)
LawGlobal-Hub Lead Judgment Report
UDOM-AZOGU, J.C.A.
This is an appeal against the judgment of Hon. Justice N. O. Adekola, Chief Judge of High Court Ibadan, Ibadan Judicial Division delivered on 9/7/99 in which he refuse the application by the defendant/appellant to set aside its judgment dated against the plaintiff dated 24/3/99.
(a) In the court below the plaintiff now (respondent) claimed against the defendant (now appellant) the sum of N4, 625,809.00 being the balance of money due to the plaintiff under the contract by which the plaintiff supplied 330 of 18mm thick coloured plywood and 10 tonnes of 12mm diameter high yield reinforcement to the defendant.
(b) Interest on the said sum at the rate of 21% from 21/5/97 till judgment is delivered and thereafter at the rate of 10% until the judgment is liquidated.
In his statement of defence the defendant denied the entire claim of the plaintiff and in paragraph 12(c) of the statement of defence he averred as follows:
“the defendant did not at any time or in any manner whatsoever, enter into any agreement with the plaintiff in the sum of N5, 119, 500.00 or that there is a balance of N4, 625, 809.00 due to the plaintiff at all.”
On 6/1/99 when trial commenced the plaintiff was in court while the defendant was absent, except that one Mr. Alimi of counsel from defendant’s counsel’s chambers announced appearance for the appellant. Throughout the entire proceedings including December 4th 2001 despite the fact the plaintiff’s counsel and defendant’s counsel were in court on February 25th 1999 when the case was adjourned to March 17th 1999, on 17/3/99 when the case came up for hearing the defendant was absent. Plaintiff’s counsel announced to the court that defendant had abandoned its defence by their absence from court and urged the court to enter summary judgment. The case was adjourned to 24/3/99 for judgment. The trial Chief Judge held,
“In the circumstance I hereby hold that by all the available evidence and all the exhibits tendered by the plaintiff in course of this case the defendant is indebted to the plaintiff in the sum of N4, 132, 480.00. I hereby give judgment in the sum of N4, 132, 480.00 being the balance due to the plaintiff from the defendant in respect of exhibits A and B. The defendant shall pay interest at the rate of 10% per annum on the judgment debt until the judgment debt is liquidated. The plaintiff has not offered sufficient evidence to prove that it should be entitled to interest of 21% per annum from the defendant when the action was filed. That shall be the judgment of the court.”
When the defendant/appellant company became aware of the judgment, it briefed its counsel S. A. Afolabi Eso to file a motion urging the court to set aside its judgment for want of jurisdiction.
After looking into the appellant’s counter-affidavit and further affidavit including notice of preliminary objection filed by the plaintiff/respondent the court on 9/7/99 ruled refusing the appellant’s application to set aside its judgment on the grounds that the judgment was one on the merit and that the issue of jurisdiction could not be raised after judgment.
This appeal is against the ruling of the court below. In addition to the 4 grounds of appeal filed, the appellant with leave of court amended and filed one additional ground of appeal bringing the number of grounds to five (5).
The appellant distilled four issues for determination from the said grounds of appeal.
Issue 1
In the face of exhibits AA2 and AA3 attached to the appellant’s motion on notice before the lower court, was there a subsisting cause of action against the appellant when the lower court proceeded to trial on 6/1/99 and delivered judgment on 24/3/99 such as to clothe the judgment with validity and strip the lower court of the power and jurisdiction to set aside the judgment upon the appellant’s application.
Issue 2
Whether having regards to the affidavit evidence before the lower court upon the appellant’s application, the appellant’s motion on notice dated 24/6/99 presented an instance when the lower court ought to have exercised its discretion to interfere with its judgment by setting it aside.
Issue 3
Whether the judgment of the lower court delivered on 24/3/99 was on the merit.
Issue 4
Was there an issue of jurisdiction properly before the learned trial Judge upon the appellant’s motion on notice which ought to have been determined by the lower court? The plaintiff/respondent elicited 5 issues for determination.
Issue 1
Whether in the absence of a valid further amended notice of appeal in the suit the court has jurisdiction to entertain the appeal.
Issue 2
Whether the judgment in the suit is a judgment in default of defence and if the answer is in the negative whether the appellant in its application before the court to set aside the judgment adduced reasonable reason why the appellant and its counsel were not in court during further hearing of the suit.
Issue 3
Whether the compromise agreement among Costain W.A Plc, the appellant and the respondent was established by credible evidence.
Issue 4
Whether a debtor by duress or fraud can impose terms of payment or settlement on a creditor.
Issue 5
Whether the application to set aside the judgment is not an abuse of the court process.
I shall address the issues based on issues raised by the appellant. In my view, they encompass the issues raised by the respondent. I shall summarise the argument of counsel for the defendant/appellant and plaintiff/respondent hereunder.
Issue 1
It is the case of the appellant in view of exhibits AA2 and AA3, the compromise agreement that the lower court lacked jurisdiction to hear and determine the suit at the time it did, the claim having been extinguished by the compromise agreement.
He argued that exhibit K attached to respondent’s counter-affidavit admitted the receipt of the money remitted via exhibit AA3. He submitted that exhibits AA2 and AA3 constitute a compromise agreement that supercedes the claim of the respondent before the lower court, more so as they came earlier than the trial and judgment of the lower court. He cited Akio Abbey & Ors v. Chief A. Ibrahim (1999) 11-12 SC SCNJ 234 where the Supreme Court held –
“Where the parties settle or compromise pending proceedings, whether before at or during trial, the settlement or compromise constitutes a new and independent agreement between them made for good considerations. Its effects are:
(1) To put an end to the proceedings for they are thereby spent and exhausted.
(2) To preclude the parties from taking any further steps in the action except where they have provided for liberty to apply to enforce the agreed terms.
(3) To supercede the original cause of action altogether, that is to say, the terms of the settlement or compromise must henceforth regulate the relationship and entitlement of the parties in regard to the matter.”
He submitted that the lower court failed to examine and make a pronouncement on the effect of exhibits AA2 and AA3 on the cause of action of the plaintiff before the lower court when the judgment of 24/3/99 was delivered, the lower court was totally devoid of all powers, statutory or inherent to entertain the claim of the respondent and its entire adjudication there was a nullity. He cited Madukolu v. Nkemdilim (1962) 1All NLR 548; (1962) 2 SCNLR 341. He posited that there must be an existing or subsisting cause of action for a court to assume jurisdiction and concluded that the cause of action in the respondent’s claim had ceased to exist prior to the trial and judgment. The long and short of the appellant’s argument in issue one is that the judgment of 24/3/99 was given without jurisdiction in view of the fact that the compromise agreement, exhibits AA2 and AA3 had extinguished the cause of action which was therefore a nullity and ought to have been set aside.
It will be necessary to examine closely exhibits AA2 and AA3 in relation to the proceedings in the court below, which resulted in the judgment of 24/3/99. The writ of summons and the claim in suit No. 1/399/97 were filed on 21/5/97 and 30/4/97. The statement of defence was filed on 30/4/99. No where in the statement of claim or defence were exhibits AA2 and AA3 pleaded or mentioned in evidence. Exhibits A and Bare LPOs and C and C1, are invoices and delivery notes. Exhibits C and C1 were tendered. PW 1 testified that the defendant paid N493, 69.00 before they sued. While the case was in court the defendant paid another N493, 691.00. He also issued a cheque for N3, 197.250 signed by only one signatory instead of two. The cheque was sent back to defendant on his request. The total balance owed the plaintiff by the defendant was therefore N4, 132, 118 only. The motion to set aside judgment of 24/3/99 was filed on 26/4/99 i.e. about one month after the judgment. It was only in paragraph 40 of the affidavit in support of the motion to set aside that exhibits AA2 andAA3 were mentioned. The defendant claimed that the payments of N493, 691.00 of 9/5/97 and N493, 691.00 of 20/11/97 were made in “full and final settlement” of the plaintiff’s claim.
This claim was however debunked by exhibit K letter from Managing Director of plaintiff/respondent part of which reads:
“We hereby reiterate that we can never accept the cheque of N493, 691 in full and final settlement of your indebtedness by your company.”
The claim of the appellant that the compromise agreement extinguished the cause of action is therefore without foundation.
Issue 1 is resolved in favour of the respondent.
On issue 2, learned counsel for the appellant submitted that the claim was fundamentally defective and the lower court ought to have set aside the judgment of 24/3/99 since it was a nullity. He cited Ojiako & Ors. v. Ogueze & Ors. (1962) NSCC VOL 2 P.44; (1962) 1 ANLR 58.
It is on record that on 6/1/99 when the trial commenced plaintiff was in court. Defendant was absent but one Mr. Alimi Esq appeared for defendant, took objections to tendering of documents and finally asked for adjournment to early February. The case was adjourned to 25/2/99 for further hearing. On 17/3/99 when the court sat, the plaintiff was in court and defendant and counsel were absent. Throughout the proceedings thereafter, the defendant failed and or neglected to appear to defend its case. No reason was given to the court explaining defendant’s absence. Paragraphs 2 and 3 of the supplementary record of proceedings depose as follows:
(1) “That the matter came up on 25th February 1999 for defence to open.
(2) That the court did not sit on 25th February 1999 and I was informed by the Court Registrar that the Presiding Chief Judge Hon. Justice Nurudeen Adekola was attending a conference out of Oyo State and the matter was consequently adjourned to 17/3/99 by the Registrar.”
The trial Judge had no option but to enter judgment for the respondent. Where the plaintiff’s claim remained unchallenged and uncontroverted the consequences are that the court will accept the available evidence as true and act on it. See the case of Lawal v. UTC (Nig.) Plc. (2005) 13 NWLR (Pt. 943) 601 at 622.
In Omoboriowo v. Ajasin (1984) 1 SC 206 at 207 per Sowemimo CJN, it was held:
“If, therefore, issues are joined on any averment, but no evidence is led to support such, the result is a striking out or a dismissal of such averment in the pleadings.”
Failure of defendant/appellant to adduce evidence in proof of the statement of defence filed renders it liable to be struck out or dismissed.
Issue 2 is resolved in favour of the plaintiff/respondent.
On issue 3, whether the judgment was on the merits, learned counsel for the appellant submitted that a judgment on the merit is a decision that was rendered on the basis of evidence led by the parties in proof of or disproof of the issues in controversy between them. He cited Mohammed v. Hussein (1998) 14 NWLR (Pt. 584) 108 at 144 where Supreme Court quoted with approval the meaning of judgment on the merit as enunciated in UTC (Nig.) Ltd v. Pamotei (1989) 2 NWLR (Pt. 103) 244 at 558-559. He finally submitted that the judgment of 24/3/99 was not a judgment on the merit and the learned trial Judge was in error in refusing to set it aside.
Since exhibits AA2 and AA3, the much vaunted compromise agreement have been discredited the issue of jurisdiction does not arise since the cause of action was not destroyed by the compromise agreement.
In addition to the definition of judgment on the merit contained in UTC (Nig.) Ltd v. Pamotei cited supra, section 37(2) of Oyo State High Court Law provides as follows:
“Any judgment obtained where one party does not appear at the trial may be set aside by the court upon such term as may see just, upon an application made within 6 (six) days after the trial or within such longer period as the court may allow for good cause shown.” (Italics mine).
It is obvious that the attempt by the appellant to place reliance on the law cited supra is liable to fail, because, as has been pointed out earlier in this judgment the motion to set aside was filed one month after the judgment, and no explanation was given for failure of the appellant and counsel to appear to defend the case. No good cause was therefore shown for failure of defendant/appellant to appear to adduce evidence in support of the statement of defence. It is in my view that the judgment was without doubt, a judgment on the merit. The learned trial Chief Judge was therefore right in refusing to set it aside. The defendant/appellant’s remedy is to appeal against the judgment. This issue is also resolved in favour of the plaintiff/respondent.
It is the case of the appellant on issue 4 that jurisdiction was raised in the appellant’s application to set aside the judgment of 24/3/99 since issue of jurisdiction can be raised at any stage. He further submitted that at the time the learned trial Judge took evidence from plaintiff/respondent and delivered judgment, the cause of action had ceased to exist in view of exhibits AA2 and AA3. I have already dealt with the aspect of the agreement earlier in this judgment and it is not necessary to repeat it here. All the issues have therefore been resolved in favour of the respondent. The appeal of the appellant therefore fails, and is hereby dismissed. The judgment of the court below is hereby affirmed.
I award costs assessed at N5, 000 in favour of the respondent.
Other Citations: (2005)LCN/1842(CA)
