Bronwen Energy Trading Ltd. V. Oan Overseas Agency (Nig) Ltd & Ors (2022)
LAWGLOBAL HUB Lead Judgment Report
MARY UKAEGO PETER-ODILI, J.S.C.
This appeal and cross-appeal erupted from the judgment of the Court of Appeal, Lagos Division or lower Court or Court below, delivered on 9th December, 2014, Coram: Joseph Shagbaor Ikyegh, Yargata Byenchit Nimpar and Jamilu Yammama Tukur JJCA. The appeal at the lower Court succeeded in part sequel to the decision of the Federal High Court of 14th March, 2011 per Dan D. Abutu J. (as he then was).
BACKGROUD FACTS
By Writ of summons and Statement of Claim dated the 23rd day of November, 2006 and filed on same date at the Federal High Court, Lagos, the Appellant commenced an Admiralty Action against the Respondents to this Appeal. See pages 1-92 of the Record of appeal, (Volume 1).
By the Appellant’s action at the Federal High Court, Lagos, which clearly falls under Section 2(2) (n) and (p) of the Admiralty Jurisdiction Act, 1991, the appellant claimed the sum of United /states Dollars $1,986,939.97 as outstanding debt against the 1st Respondent for port and cargo dues and ships’ charges and agency fees. The Appellant also claimed interest on the said sum of United States Dollars $1,986,939.97. The Appellant’s Statement of Claim was amended by Order of the Federal High Court made 21st July, 2008. See pages 691-714 of the Record of Appeal, (Volume 11).
At the time of commencing the action at the Federal High Court, the Appellant also filed a motion ex-parte requesting an Order of arrest/detention of the Vessel MT “Ocean Success” and the Cargo of 15,300 MT of premium Motor Spirit (PMS) onboard the Vessei MT “Ocean Success” both being the only known assets of the 1st Respondent within jurisdiction in the reasonable contemplation of the Appellant at the time of commencement of the proceedings at the Federal High Court, Lagos. The motion was dated 23rd November, 2006, and filed on same date. See pages 93-194 of the Record of Appeal, (Volume 1).
On 24th November, 2006, the Federal High Court made an Order for the arrest of the Vessel MT “Ocean Success” and the Cargo of 15,300 MT of Premium Motor Spirit (PMS) on board the said vessel pending the provision of a Bank Guarantee from a reputable Bank in Nigeria to secure the claim of the appellant at the Federal High Court.
On 27th November, 2006, the Writ of Summons, Statement of Claim, Order of Arrest, Notice of Arrest, Warrant of Arrest and all other processes filed in the suit were served on all the Defendants to the suit at the Federal High Court, Lagos, including the 1st Respondent who duly acknowledged service and entered appearance to the suit at the Federal High Court, Lagos.
The 1st Respondent subsequently filed an application dated 1st December, 2006, for the release of the MT “Ocean Success” and Cargo of 15,300 MT of Premium Motor Spirit on board the vessel which were detained pursuant to the Order of the Federal High Court made on 24th November, 2006. See pages 213-219 of the Record of Appeal, (Volume 1). The 1st Respondent also provided a Bank Guarantee from Ecobank of Nigeria Plc to secure the claim of the Appellant at the Federal High Court, Lagos, and on this basis, both the vessel, MT “Ocean Success” and Cargo of Premium Motor Spirit (PMS) were released from arrest. See pages 216-218 of the Record of Appeal, (Volume 1).
It is instructive to point out that the 1st Respondent had earlier filed an application dated 29th November, 2006, seeking a discharge of the ex-parte Order of arrest of the vessel and cargo. See pages 206-212 of the Record of Appeal, (Volume 1). Attached to the application was an affidavit of 21 paragraphs. In paragraph 9 of the affidavit attached to the application, the Managing Director of the 1st Respondent who deposed to the affidavit made the following admission:
“That regarding the sum of US$907,69484 estimated to be outstanding and due to the Plaintiffs, the 3rd Defendants as agents of the said Projector SA requested the Plaintiffs orally and by letters to provide a payment schedule through which the said US$907,694.84 would be settled but the Plaintiff failed to provide same”.
See pages 204-209 of the Record of Appeal, (Volume 1).
Flowing from the above admission and other correspondence between the Appellant and 1st Respondent, was the fact that 1st Respondent was indebted to the appellant for agency services rendered by the appellant to the 1st respondent.
The 1st Respondent filed a Statement of Defence dated 19th December, 2006. See pages 288 – 298 of the Record of Appeal, (Volume 1). The Statement of Defence of the 1st Respondent was subsequently amended by Order of the Federal High Court, made on 5th August, 2009. See pages 814-816 of the Record of Appeal, (Volume 111) for the Order of Court granting leave to amend the statement of Defence and pages 818-844 of the Record of Appeal, (Volume 111) for the 1st Respondent’s Amended Statement of Defence.
After a series of interlocutory applications filed by the 1st Respondent were disposed at the Federal High Court, trial eventually commenced in respect of the substantive suit on 1st April, 2008, with the Appellant calling only one witness, P.W.1. See pages 604-613, 729-741, 766-770, 787-790 of the Record of appeal, Volume 11). Final judgment was delivered by the Federal High Court on 14th March, 2011. see pages 1069-1073 and 1077-1114 of the Record of Appeal, (Volume 111).
The 1st Respondent appealed against the judgment of the Federal High Court, Lagos, by a Notice of Appeal dated 16th March, 2011, to the Court of appeal. See pages 1179-1181 of the Record of appeal (Volume 111). The Court of Appeal delivered its judgment in respect of the appeal of the 1st Respondent on 9th December, 2014. See pages 1410-1962 and 1478-1528 of the Record of Appeal (Volume 4) for the judgment of the Court of Appeal. It is against the judgment of the Court of Appeal that the Appellant has now appealed to the Supreme Court with leave of the Court of Appeal granted on 5th February, 2015. See the relevant Notice of Appeal of the Appellant at pages 1602-1609 of the Record of Appeal (volume 4).
On the 22nd November, 2021 date of hearing, learned Senior Advocate for the appellant, Sylva Ogwemoh adopted the brief of argument filed on 12/8/2015 and nominated three issues for determination which are thus:-
i. Whether the Court of Appeal was right in awarding the sum of United States dollars US$400,000.00 in favour of the 1st respondent as daily character when on the evidence on record and as admitted by the respondent. It is neither charterer nor owner of the Vessel MT “Ocean Success” and when proof by evidence as required by law of such a colossal sum having been incurred by the 1st Respondent as daily charter cost was not before the Court. Grounds 1 & 2 of Notice of Appeal dated 11/02/2015 and filed on same date.
ii. Whether the Court of appeal was right in awarding the sum of United States dollars US$9,500.00 in favour of the 1st Respondent being cost of issuing Bank Guarantee and interest of 18% being Central Bank of Nigeria official rate on the sum of the Bank Guarantee, when the evidence required under law in support of the claims was not before the Court. Ground 5 of the Notice of Appeal dated and filed on 11/02/2015.
iii. Whether the Court of Appeal was right when it awarded “post judgment interest at the rate of 5% from date of judgment until the total sum is fully liquidated” when no such claim was made by the 1st Respondent before the Court. Ground 8 of the Notice of Appeal dated and filed on 11/02/2015.
Appellant also filed a Reply brief on 19/2/2018 and deemed filed on 6/6/2019.
N.K. Oragwu Esq, learned counsel for the 1st respondent adopted the brief of argument filed on 6/9/2017 and deemed filed on 6/6/2019, though settled by Chief Anthony Idigbe SAN. He distilled three issues for determination as follows:-
- Having regards to the facts of the case and the evidence before both Courts below showing undoubtedly that the vessel in question was wrongfully arrested. Whether the lower Court was right in awarding the sum of USD$400,000.00 in favour of the 1st Respondent being the daily charter cost.
- Whether from the facts and circumstance of the case, the lower Court below was right in its holding that item 5 of the Respondent’s counter claim was proved thus awarding the sum of USD$9,500 in favour of the Respondent being the cost of issuing bank guarantee and an interest of 18% being Central Bank of Nigeria official rate on the sum of the said bank guarantee.
- Whether the Court of Appeal was right when it held that the Respondent is entitled to the Post judgment interest at the rate of 5% from the date of judgment until total sum is fully liquidated considering the fact that same was before the Court and of course duly acknowledged.
For ease of reference, I shall make use of the issues crafted by the appellant.
ISSUE NO. I
Having regard to the facts of the case and the evidence before showing undoubtedly that the vessel in question was wrongfully arrested, whether the lower Court was right in awarding the sum of USD$400,000.00 in favour of the 1st respondent being daily the charter cost.
Learned counsel for the appellant submitted that the Court below fell into error in awarding the US$400,000.00 in favour of the 1st respondent when it was found as a fact that the 1st respondent was not the owner of the arrested vessel. That the law is that only owners of a ship or demise charterers can sue and be sued for loss or damages arising from the use of the ship or for wrongful arrest and/or detention of the ship. He cited Eastwind Transport (Nig) Ltd v. Comet Merchant bank Limited 1995-1997 Vol.4 NSC page 85; R.C.C. (Nig) Ltd v. R.P.C. Ltd (2005) 10 NWLR (pt.934) 615 at 638.
That even if damage was sustained, the claimant ought to have specifically pleaded same and provided credible and admissible evidence in proof of the damage sustained for the award to be made. He referred to U.B.N. Plc v. Ajabule (2011) 18 NWLR (pt.1278) 152 at 174
That the award of US$400,000.00 in favour of the 1st respondent as daily cost ought to be set aside since no evidence was proffered in support of the award.
For the 1st respondent, it was contended that the arrest and detention of the vessel was wrongful and utterly baseless in law. That the appellant having failed to establish the ownership of the vessel by the 1st respondent to justify the arrest and detention of the vessel and so appellant became liable for the costs incurred in the release of the vessel.
Learned counsel for the 1st respondent submitted that other persons than the ship owner can sue for damages in respect of loss incurred for action of a third party on the ship. He cited Alfotrin Ltd, Owners of MV Fotonic v. A.G. Federation & Anor (1987-90) 3 NSC 343; Rebold Industries limited & Anor v. Magreola (2015) LPELR – 246 12 (SC).
In reply on points of law, Learned counsel for the appellant said that Court below was in error in delving into the issue of whether or not the arrest of the 1st respondent was wrongful as it was not pronounced upon by the Federal High Court and not part of its judgment and not raised as a ground of appeal. He cited Ezeigwe v. Nwawulu (2010) 4 NWLR (Pt. 1183) 159 at 203-204 etc.
RESOLUTION
The action of the appellant at the Federal High Court, Lagos was against four defendants, with the 1st respondent as 3rd defendant. The appellant also brought an application simultaneously with the filing of the Writ of Summons and Statement of Claim for the arrest of the following property:
(a) the vessel MT “Ocean Success” (2nd Respondent); and
(b) the entire cargo of 15,300 Metric tons of Premium Motor Spirit (PMS) on board the vessel. The cargo was the 3rd Defendant at the proceedings before the Federal High Court Lagos. See Pages 1-195 of the Record of Appeal (Vol.2).
In the 1st Respondent’s Amended Statement of Defence to the Statement of Claim of the Appellant, it stated as follows:
- “The 3rd Defendant denies paragraph 2 of the Statement of Claim and in reaction thereto states that the vessel MT “OCEAN SUCCESS” is not under the charter of the 3rd Defendant.
- In reply to paragraphs 4 and 5 of the Statement of Claim, the 3rd Defendant states that it is neither the charterer nor the disponent owner of the vessel MT”OCEAN SUCCESS” nor the owner of the cargo of 15,300 MT of PMS on board the vessel as the vessel was chartered under voyage charter dated 22nd September, 2006, by Bronwen Energy Trading Limited of Dominican Republic, an associate company of the 3rd Defendant. The 3rd Defendant pleads and would rely on copy of the Voyage Charter at the trial”. See pages 818-824 of the Record of Appeal, (Volume 111).
The 1st Respondent in the course of trial at the Federal High Court called only one witness, who in his witness deposition stated as follows:
“7. The 3rd Defendant, as agent of disclosed principal, is neither the charterer nor the despondent owner of the cargo of 15,300 MT of PMS on board the vessel as the vessel was chartered under a voyage charter dated 22nd September, 2006 by Bronwen Energy Trading Limited of Dominican Republic and associate company of the 3rd Defendant.”
The 1st respondent’s witness under cross-examination stated as follows:-
“The 3rd Defendant is not the owner of the vessel”
In respect to the counter-claim of the 1st respondent, the Federal High Court dismissed it, holding thus:-
“The 3rd Defendant has attempted to show that it is not the owner of the vessel MT “Ocean Success”. The evidence of DW2 is also that the 3rd Defendant is not the charterer of the vessel. The capacity in which the 3rd Defendant is claiming US$400,000.00 as charter cost of the vessel while the arrest lasted is not disclosed. It is my firm view that the 3rd Defendant has not shown that it has locus standi to claim for daily charter costs. The 3rd Defendant has not also proved that it is entitled to the other reliefs sought in this action. On the whole, it is my firm view that the Counter Claim is frivolous and misconceived. The counter claim has not been proved. The Counter claim is hereby dismissed.”
The Court below however granted that counter claim. It is clear that the Court of Appeal fell into error in awarding US$400,000.00 in favour of the 1st Respondent when it was found as fact that the 1st Respondent was not the owner of the arrested vessel. This is because if it is the case that the 1st Respondent was neither owner nor charterer of the arrested vessel, the question this Court ought to ask is whether the 1st Respondent has the legal capacity in the circumstance to maintain an action for the alleged wrongful arrest. This is because it is the law that only a demise charterer or the owner of an arrested vessel who possesses the requisite legal capacity to maintain an action for wrongful arrest. It is trite that the 1st Respondent cannot assume a right nor can the Court of Appeal clothe it with a right which it does not legally possess. The law is that only owners of a ship or demise charterers that can sue and be sued for loss or damage arising from the use of the ship or for wrongful arrest and/or detention of the ship. See Eastwind Transport (Nig) Ltd v. Comet Merchant Bank Limited 1995-1997 Vol. 4 NSC (Nigerian Shipping Cases) pages 85.
The case put forward is that the 1st respondent is neither the owner nor charterer of the arrested vessel and so any purported damage or loss suffered by the respondent was voluntary and self induced and underserving of relief from this Court. I refer to R.C.C. (Nig) Ltd v. R.P.C. Ltd (2005) 10 NWLR (pt. 934) 6.5 at 638 the Apex Court held thus:
“A plaintiff who claims damages for the commission of a tort or breach of contract must take all reasonable steps to mitigate the loss which he has sustained consequent upon the defendant’s wrong, and, if he fails to do so, he cannot claim damages for any such loss which he ought reasonably to have avoided. On the other hand, where the plaintiff does mitigate his loss, he cannot recover damages in respect of that avoided loss even if the steps he took to avoid the loss are characterised as being more than what was reasonably necessary”.
Assuming that the case is that the 1st respondent is the owner or charterer of the arrested vessel which is not the case before the Court, and it has suffered damage in the circumstance, the law still requires proof by evidence of the claim for US$400,000.00 being alleged calculated daily charter cost. The Court of Appeal before making the award ought to have made an enquiry into how the 1st Respondent arrived at the cost of US$80,000.00 per day which made a total of US$400,000.00 as five (5) days. These heads of costs were lumped together and were not itemised or specifically pleaded as required by law. If one may ask of the sum of US$80,000.00 per day which made up the total of US$400,000.00 allegedly incurred for five (6) days; how much is for security? How much is for bunkers? And how much is for crew welfare?
Apart from the fact that the above heads of claims were not specifically pleaded, no evidence whatsoever was led before the Federal High Court being the Court of trial and none was made available at the Court below in support of the various heads of claims. Therefore, the award of US$400,000.00 being alleged calculated daily charter cost was erroneously dished out as no proof was provided as the law requires. In the case of Nwanji v. Coastal services (Nigeria) Ltd (2004) 11 NWLR (Part 885) 552 at 568,57, UWAIFO, JSC had this to say:
“The only part of the Statement of Claim where iron rods and cement were mentioned was the final claim paragraph. There it is simply stated thus:
’41 trucks of cement and iron rods cost N74,000.00″.
Even if this had been made an averment and not just part of the particulars of claim, it would still have been wrongfully inadequate and lacking in specificity. There is no indication as to how many bags of cement and number of iron rods in one truck. The question remains how N74,000.00 stated was calculated. No Court can determine this without an averment as to the number of iron rods and bags of cement, and the cost of each. In the circumstances therefore, the evidence adduced must be considered inadmissible”.
In the above cited case, BELGORE, JSC, in this contributing judgment at page 571, held thus:
“In our procedure for trying civil matters the position has always been that all items claimed must be clearly pleaded. In claiming special damages, the pleadings must be clear as to what is being claimed. In this matter on appeal, a lump sum was pleaded as cement and iron rods lost without specifically averring to quantity and cost of each material. The Court must rely on what parties claim specifically and as impartial arbiter must not embark on doing the arithmetic the parties never put forward, The purpose of pleading is to clearly alert the opponent what he is to meet. Certainly pleading must contain facts, only facts, the opponent is to meet and not evidence; but in situation where loss of certain times is claimed, quantity of such items and the value in money must be dearly averred in pleading. This will obviate doubt and allow parties to the suit make preparation to meet the averment.”
The position has been well settled on the point and that is why specific damages must be clearly pleaded and strictly proved by evidence.
In this case at hand, no evidence was proffered to support the bare allegation of a payment of the sum of US$80,000.00 as daily charter cost to aver security, bunkers and crew welfare. Clearly the averment on this expenditure in the counter claim was bereft of particulars.
I shall quote paragraph 6 of the Court claim in vol 111 of the Record of appeal, thus:
“6. The Counter claimant avers that owing to the inability of the vessel to set sail due to the arrest, the counter claimant was paying US$80,000.00 daily for security, bunker and crew welfare while the arrest lasted.”
Nothing other than the bare averment was said regarding the daily cost of US$80,000.00 allegedly incurred apart from the mere statement in the counter claim quoted above. No indication was given as to the number or kind of security that was provided or the arrested vessel by 1st Respondent and the cost implication for the alleged security provided. No indication was also given on the cost of bunkers or what portion of the daily charter cost covered the cost of bunkers. Furthermore, no indication was given on the cost involved in crew welfare and also on the number of crew men engaged by the 1st Respondent to man the vessel and what was spent on each crew member on board the vessel. And to make matters worse, no evidence whatsoever was led in support of the above heads of expenses as was rightly found by the Federal High Court and even the Court of Appeal. Not even a receipt or any form of documentation regarding payments made was brought before the Federal High Court or Court of Appeal. The Federal High Court in its judgment on the Counter claim of the 1st Respondent found as follows:
“There is no attempt made by DW2 to show that the 3rd Defendant is entitled to the colossal sum of money claimed in the Counter claim… On the whole, it is my firm view that the Counterclaim is frivolous and misconceived is hereby dismissed”.
It is difficult to fault the finding of the trial Court hence one is at a loss on what the Court below did in that regard. This is because the claim of the 1st Respondent for US$400,000.00 being calculated daily charterer cost to cover security, bunkers and crew welfare falls under special damages for which the law requires special proof by evidence. This evidence was not provided in this case. The law does not infer special damages merely from the pleadings or from the state of the facts of a case. Once it is claimed, the law requires proof of the special damage up to the last kobo or cent as the clam in this case is in dollars. In the case of A.T.E. Co Ltd v. MILITARY GOVERNOR, OGUN STATE (2009) 15 NWLR (PART 1163) 26 AT 71, this Court held thus:
“Special damages are damages of the type the law will not infer from the nature of the act. They do not flow in the ordinary course and they are exceptional in their character. This is why they must be claimed specially and proved strictly.”
At Page 80 of the above cited case, the Supreme Court further held thus:
“Strict proof is mandatory in proof of special damages. That is why the determination of a claim for special damages on a party’s pleadings alone may not be prudent. It must be backed by concrete evidence in Court. See also Incar (Nig) Ltd v. Adegboye (1985) 2 NWLR (Part 8) 453; Ekennia v. Nkpakara (1997) 5 NWLR (part 504) 157 at 172 ”
The matter is all the more instructive that even if damage is sustained in the circumstances of a particular wrong, the law does not exonerate the claimant from pleading specifically the damage that occurred and providing credible and admissible evidence proof of the damage sustained for an award to be made. In U.B.N. PLC v. AJABULE (2011) 18 NWLR (Part -278) 152 at 174, the Supreme Court held that special damages must be pleaded with distinct particularity and strictly proved because a Court is not entitled to make an award of special damages based on conjecture or on some fluid and speculative estimate of alleged loss sustained by a party. See also DUMEZ (NIG) LTD v. OGBOLI (1972) 1 All NLR 241.
Curiously the Court below agreed with the conclusion on the facts as made by the trial Court which is that 1st respondent did not provide evidence in support of its counter claim and special damages but that appellate Court went on to award the sum of US$400,0C0.00 as daily charter cost. I shall quote the Court below per Yargata Byenchit Nimpar JCA as follows:-
“Let me first state categorically that the judgment sum awarded against the appellant as outstanding fees for services rendered is duly supported by evidence and it stands. That means that the first head of Counter claim which is general damages for loss income cannot be justified because appellant is liable for the judgment sum as decided by the Trial Judge. This is so because competence of claim is determined on the pleadings of the claimant… The claim though misleading led to the wrongful arrest of the vessel. They would need to prove loss of earnings and reputation as claims under special damages. This was not done”.
From the findings of the Court of Appeal, it is clear that the lower court did find that it was imperative on the 1st Respondent to prove that it incurred loss as a direct consequence of the arrest of the vessel which proof the lower Court held was not done. The Court however proceeded to award the colossal sum of US$400,000.00 in favour of the 1st respondent in spite of its holding that proof of special damage or of loss of earning was not done and in spite of the Court’s finding that the judgment sum awarded in favour of the Appellant to the 1st Respondent was supported by evidence and it stands. The only reason that could be deduced for the erroneous award with respect to the sum of US$400,000.00 as daily charter cost is the wrong conclusion arrived at by the Court of Appeal that the arrest was wrongful.
For an arrest to be declared wrongful, certain thresholds must be met before compensation is awarded. The Court of Appeal in a bid to justify the award of the sum of US$400,000.00 relied heavily on Section 13 of the Admiralty Jurisdiction Act, Laws of the Federation of Nigeria, 2004.
It needs be said that for Section 13 of the Admiralty Jurisdiction Act, Laws of the Federation of Nigeria, 2004 to apply certain parametres must be established such as that the arrest was made unreasonably and without good cause. See Section 13 of the Admiralty Jurisdiction Act, Laws of the Federation of Nigeria, 2004.
“13(1) where in relation to a proceeding commenced under this Act-
(a) A party unreasonably and without good cause —
(i)
(ii) obtain the arrest of a ship or other property under this Act…”
The question immediately arising is whether the Court of appeal did rightly come to the conclusion that the arrest was wrongful when it found in the lead judgment delivered by Honourable Justice Yargata Byenchit Nimpar, JCA, thus:
“Let me first state categorically that the Judgment sum awarded against the appellant as outstanding fees for services rendered is duly supported by evidence and it stands”
What seems glaring from the facts is that the 1st respondent was in possession of the vessel at the relevant time, the 1st respondent was also the owner of the cargo of Premium Motor Spirit (PMS) on board the vessel which cargo was also arrested by Order of Courts. Therefore, there were no facts upon which the Court of Appeal could infer unreasonableness and without good cause for the arrest of both the vessel and the cargo on board the vessel. In Compania Navegacion & Financiera Bosnia S.A. (Owners of the ship M.V. Bosnia) v. Mercantile Bank of Nigeria Limited. The BOSNIA No.2 (1980-1986) Nigeria Shipping Cases (NSC) Vol.2, it was held by the Court of Appeal that it is settled law that for any case of unjustified arrest of a ship to give rise to a successful action in damages there must be proof of either bad faith or gross negligence. That Court went on to state that mala fides or bad faith, implies a malicious intent, improper motive and as in the common law action of malicious prosecution, the bad faith has generally to be proved as a separate requirement from the absence of justification for the arrest.
Another way of stating it simply is that the head of claim is not a given, just by the mere assertion of an arrest without more. It must be properly established that the arrest was unreasonable, without just cause or in bad faith and that has not happened here.
This issue is resolved in favour of the appellant.
ISSUE NO.2
Whether the Court of Appeal was right in awarding the sum of United States Dollars US$9,500.00 in favour of the 1st respondent being cost of issuing Bank Guarantee and interest of 18% being Central Bank of Nigeria official rate on the sum of the Bank Guarantee, when the evidence required under law in support of the claims was not before the Court.
Canvassing the position of the appellant, learned counsel submitted that under Order VII Rule 1 (i) of the Old Admiralty jurisdiction Procedure Rules, 1993 which has an equivalent provision in Order 7 Rule 1 (ii) of the New Admiralty Jurisdiction Procedure Rules 2011, a party to a proceeding commenced as an action in rem way by motion ex parte apply for an arrest warrant in respect of the ship or other property against which the proceeding was commenced.
That where a party takes steps to mitigate his loss, he cannot recover damages in respect of that loss even if the steps he took to avoid the loss are characterised as being more than what was reasonably necessary. He cited R.C.C. (Nig) Ltd v. R.P.C Ltd (2005)10 NWLR (pt.934) 615 at 638.
That apart from the mere fact that a Bank Guarantee was procured, no other evidence was brought before the Court to show that indeed the cost of US$9,500.00 was incurred in procuring the Bank Guarantee and that being within the ambit of special damage needed not only to be pleaded but also to be specially proved by credible and admissible evidence. He stated that no such evidence was made available before the Court below.
Learned counsel for the appellant stated that the alleged 18% per annum being CBN official rate of interest was neither pleaded nor evidence led in support and so cannot stand.
For the 1st respondent, it was contended that the law is that even in cases where a defendant fails to lead evidence in proof of its counter claim, the Courts can rightly grant such claims. He cited Balogun v. UBA Ltd (1992) 6 NWLR (pt.247) 336.
That there was enough before the lower Court upon which it reached its decision over the award of US$9,500.00.
In reply on points of law, learned counsel for the appellant stated that the Court below was wrong to proceed under Section 15 of the Court of Appeal Act in awarding the sum of US$9,500.00 being cost of obtaining the Bank Guarantee as there was no material before that Court to justify that award.
RESOLUTION
Under Order VII Rule 1 (i) of the Old Admiralty Jurisdiction Procedure Rules 1993, which has its equivalent provision in Order 7 Rule I(ii) of the New Admiralty Jurisdiction Procedure Rules 2011, a party to a proceeding commenced as an action in rem may by motion ex parte apply for an arrest warrant in respect of the ship or other property against which the proceeding was commenced as the purpose of the arrest is to secure the claims of the arresting party.
Appellant argued in support of its issue two that the lower Court ought not to have awarded the sum USD9,500 in favour of the 1st respondent being cost of issuing Bank Guarantee and interest of 18% being Central Bank of Nigeria official rate on the sum of the bank Guarantee in the absence of any evidence in support of the claim. The argument of the Appellant on this issue is baseless in the light of the position of the law that even in cases where a defendant fails to lead evidence in proof of its counter claim, the Courts can rightly grant such claims. See Balogun v. UBA Ltd (1992) 6 NWLR (Pt.247) 336 where the Supreme Court held thus:
The learned Justice Nimpar held further:-
“In some cases a defendant who offers no evidence could still have judgment in his favour if the plaintiff is unable to prove an essential element of his claim”
The lower Court in its judgment at page 1578 of the Record the Court held as follows:
“On the second head of claim which touches on the 2nd and 3rd respondents, even without evidence from the Appellant, the Court should have awarded damages for wrongful arrest of the 2nd respondent under Section 13 of the Admiralty Jurisdiction Act…”
The Court below held thus:-
“I find item 5 proved because the issue of securing a bank guarantee is before the Court and duly acknowledged. It was upon that basis that the vessel was released. DW2 also testified on it. There was no challenge to the evidence of DW2 on that point.”
I agree with counsel for 1st respondent that from the nature of the arrest of the vessel which turned out to be unnecessary and without just cause, the liability of the Appellant had arisen. Firstly, the appellant cannot raise this point because the Appellant itself had tendered in evidence a letter of offer of Credit Facilities from GTBank in evidence (pages 675-679 of the Record) pursuant to which the Federal High Court and the Court of Appeal had awarded interest in favour of the Appellant. In fact the lower Court in commencing its analysis on the counterclaim in its judgment at page 1576 stated as follows:
“This issue calls for re-evaluation of the evidence before the Court vis a vis the counterclaim”
Clearly all documents before the Court were considered including the above letter tendered by the appellant before the Federal High Court. Secondly, note must be taken that the provision of Section 13 of the Admiralty Jurisdiction Act (Cap A5) LFN 2004 enables the Court to deal with the issues of damages summarily. An application was filed before the Federal High Court requesting for security for cost from the Appellant. See pages 370-372 of the Record. A further Affidavit was also filed in support of the application with an Exhibit identified as Bron 1 which was a facility letter for the provision of the Bank Guarantee before the Federal High Court. (pages 383-386 of the Record). The 1st Respondent in its 3rd Defendant/Counter Claimant’s Reply to Plaintiff’s Defence to Counter Claim (page 856-861 of the Record) in paragraph 3 thereof averred as follows:
“The 3rd Defendant/counter claimant avers that the Plaintiff’s claims and the subsequent arrest of the vessel MT OCEAN SUCCESS is vexation and without merit and amounts to an attempt to forcefully obtain monies from the 3rd Defendant, an agent, instead of the principal, the 5th Defendant and the 3rd Defendant is entitled to damages for all its losses including the cost of the bank guarantee it provided. The 3rd Defendant shall rely on the letter of offer issued by the bank in respect of the bank guarantee at the trial of this suit.”
The said letter was also attached to this document. This averment was never either controverted by the Appellant nor denied. It was clearly also deemed as admitted in law. Further on this point, it is a firmly settled principle of law that facts admitted need no further proof and same is deemed established. See NAS Ltd v. UBA Plc (2005) 14 NWLR (Pt. 945)421 @435 A-B, where the Supreme Court, per Akintan JSC, held as follows:
“The position of the law is that facts admitted require no further proof.”
This Court in the case of Oforlete v. State (2000) 12 NWLR (Pt. 681)415 held that where there is unchallenged and uncontroverted evidence, the Court has a duty to act on it.
Interestingly, this same material piece of uncontroverted evidence was picked from the witness statement of the 1st Respondent’s witness and restated by the Appellant in paragraph 4.25 of the Appellant’s Brief. This evidence was uncontroverted and still unchallenged under cross examination. Failure to cross examine on a matter is acceptance of the fact. See Gaji v. Paye (2003) 8 NWLR (Pt. 823) 583@605. No further proof is required. This point is even accentuated by the fact that the 1st Respondent took out an Ecobank Guarantee in respect of the arrested vessel as shown on pages 218-219 of the Records of Appeal on the terms contained in the Offer Letter on page 858. A sum of USD 1,900,000.00 (One Million, Nine Hundred Thousand United States Dollars only) was granted to the Appellant. Also, according to the offer letter, a guarantee fee of 0.5% flat would be payable upfront for the guarantee to be executed in favour of the 1st Respondent. This bond was posted for the sole purpose of mitigation of the loss that would have affected the vessel whilst it was in detention. For this purpose, the Court below rightly found that the Appellant were liable for the cost of obtaining the bank guarantee at the cost of USD9,500. These facts and evidence were before the lower Court and it rightly relied on them to find in favour of the Appellant. A simple computation would have revealed to the Appellant (just as the Court below clearly found) that the sum of USD9,500 is derivable as the cost of 0.5 percent of the guarantee sum of USD1,900,000.00 (One Million, Nine Hundred Thousand United States Dollars Only) being the cost of the Bank Guarantee.
Clearly, the Court below did justice when it looked at the documents before it in the record of appeal to come to the conclusion that there was sufficient evidence to ground the grant of the claim of USD9,500 as made by the 1st respondent and clearly evincible from the documents before the Court.
With regards to Appellant’s further contention that the 1st Respondent failed to show sufficient evidence to warrant the grant of the sum of USD9,500 because it ought to have done so by producing relevant documents, it is humbly posited that the documents before the Court of Appeal were clearly and easily sufficient to arrive at the decision reached by the lower Court. For instance, the Letter of Offer (page 858 of the Record) in the clause captioned “Guarantee Fee” shows that the sum of USD9,500 (being 0.5 percent of USD1,900,000.00) before the Guarantee sum would be released. Thus, the condition precedent for the release of the guarantee sum was the payment of the cost. These facts were glaring and obvious for the Courts below to see and the Court of Appeal rightly saw and relied on this set of documents before it. No further proof or evidence was required.
The appellant’s contention that the award of an interest rate of 18 percent was done by the Court below without any evidence before Court and in the absence of document from the CBN is an assertion that had no basis. This is because on page 675 of the Record of Appeal – Volume 2 thereof, there appears a clear indication of what the prevalent CBN rate was at the relevant time. Under the Clause, “Interest Rate” it is copiously provided that ”in line with the prevailing money market conditions”. However, the current rate, subject to review, shall be 17% per annum. It is submitted that this document is clear and speaks for itself, thus obviating any cause for doubt in the circumstance. The documents before the Court were sufficient to guide the lower Court in arriving at the finding it reached with regards to interest rate it awarded in favour of the 1st respondent. Furthermore, 1st Respondent humbly urged the Court to see the Bank Guarantee document on page 218 and 219 which the Court relied on for additional 1 percent thus making the entire interest on the Guarantee 18% per annum. These facts were before the lower Court and it had every justification and jurisdiction to rely on or look at them.
It is trite that a Court has jurisdiction to suo motu make reference to its record or to its case file or record of appeal as the case may be and make use of any document it finds necessary. In Agbahomovo v. Eduyegbe (1999) 3 NWLR pt. (594), 170 at 182 this Court stated that a Court has the right to look at a document in its file. See also the case of Agbaisi v. Ebikorefe(1997) 4 NWLR pt.(502),630; Ogbunyiya v. Okudo (1979) 3 LRN 318. See also SBM Services (Nig) Ltd v. Okon (2004) 9 NWLR (Pt. 879) 528 @550 A-B; Daggash v. Bulama (2004) 14 NWLR pt. 892144; Fumudoh v Aboro (1991) 9 NWLR (pt. 214) 210; Onagoruwa v Adeniji (1993) 5 NWLR (pt. 293) 317.
In the matter of the question herein under discourse, the Court of Appeal was correct in making the award of $9,500.00 and the interest of 18% to respondents according to the Central Bank, as the findings and conclusion of the appellate were well grounded in documents and material available to the Court.
This issue is resolved in favour of the 1st respondent.
ISSUE NO.3
Whether the Court of Appeal was right when it awarded “post judgment interest at the rate of 5% from date of judgment until the total sum is fully liquidated” when no such claim was made by the 1st respondent before the Court.
Learned counsel for the appellant submitted that a Court cannot award to a party that which he had not claimed as is the case in the matter at hand.
In response, 1st respondent contends that after winning a judgment, the Courts are empowered to make such discretionary orders as to preserve the benefit of the judgment until such time as it is complied with. That post judgment interest needs not be specifically claimed. He cited A.I.B. Ltd v. I.D.S Ltd (2012) 17 NWLR (PT.1328)1 at 50 & 55 etc.
For the appellant on point of law, it was contended that the distinction between an action in rem and an action in personam is merely procedural and does not affect the substance of the suit or the jurisdiction of the Court to determine the suit before the Court. He cited Rhein MASS UND See GMBH v. Rivway Lines Limited (1998) 5 NWLR (pt.54)) 265 at 277-278.
It is not a matter for endless discourse as it is well settled that after winning a judgment, payment may be delayed by the judgment debtor.
For this reason, the Courts are empowered to make such discretionary orders as to preserve the benefit of the judgment until such time as it is complied with. No doubt, one of such processes is the Post-judgment award of interest which serves to compensate the successful party for the loss of use of money from the period of the Court’s judgment until the time the judgment is actually paid, including the period during which appeals are pending. Post-judgment interest compensates the successful party for the delay in receiving the judgment owed. This is clearly in exercise of its discretionary powers to order interest in respect of a judgment in favour of a party. The law is that post judgment interest need not be specifically claimed. The award is at the discretion of the Court and it is regulated by the rules and operating statute. see A.I.B. Ltd v. I.D.S. Ltd (2012) 17 NWLR (p.1328)1 @ 50G & 55D-E; Himma Merchants Ltd v. Aliyu (1994) 5 NWLR (pt.347) 667; I.T.B. Plc v. K.H.C. Ltd (2006) 3 NWLR (pt.968)443. A trial Court and the Court of Appeal have jurisdiction to award post judgment interest whether or not such was claimed. I place reliance on U.LG.C. v. Inwang (2010) 4 NWLR (pt.1185) p.529; Echaka Cattle Ranch v. N.A.C.B. (1998) 3 SCNJ 64.
What is at stake here is the exercise of discretion of the Court and the law is trite that after weighing all the circumstances of the case in the interest of justice and the parties involved, including the balance of convenience and disadvantages which might be suffered by any of the parties concerned. In this instance there is no doubt that the lower Court appreciated the vicissitudes which the 1st respondent went through hence the award on till 5% of the judgment sum up till the judgment debt is paid up. This issue is resolved in favour of the respondent.
The conclusion is that while Issue one is resolved in favour of the appellant, issues 2 and 3 are for the 1st respondent. The implication is that the appeal is allowed in part. while the award of US$400,000.00 granted by the Court of Appeal is set aside. The award of US$9,500 in favour of the 1st respondent being the cost of issuing Bank Guarantee and an interest of 18% being Central Bank of Nigeria official rate on the sum is upheld and granted.
The Court of Appeal was also right when it held that the respondent is entitled to the post judgment interest at the rate of 5% from the date of judgment until the total sum is fully liquidated.
Appeal allowed in part.
CROSS-APPEAL
This cross-appeal seeks to pray the Apex Court to nullify the 1st respondent’s suit for being incompetent, set aside the decision of the lower Court that the failure of the trial Court to determine the incompetency of the suit was not enough to nullify the judgment of the trial Court and finally set aside the decision of the lower Court which retained the judgment sum awarded in favour of the 1st respondent.
The cross-appellant in the brief filed on 12/11/2020 and deemed filed on 21/11/2021 distilled two issues for determination which are stated hereunder, viz:
i. Whether the Court of Appeal was right to hold that failure of the trial Court to determine the competency of the 1st Respondent suit is not sufficient to nullify the judgment when the Court has rightly found that the suit was indeed brought by incompetent procedure, Distilled from Ground 1.
ii. Whether the lower Court’s failure to strike out the 1st Respondent’s suit having found that the suit is incompetent, occasioned a miscarriage of justice. Distilled from Ground 2 and 3.
The learned counsel for the cross-appellant also adopted the Reply brief filed on 24/2/2021 and deemed filed on 21/11/2021.
Sylva Ogwemoh SAN, learned counsel for the 1st cross respondent adopted the brief filed on 8/1/2021 and deemed filed on 21/11/2021 and argued a Preliminary Objection to the competence of the cross appeal. He raised a sole issue in the event that the Objection failed and the issue is:-
Whether the learned Justices of the Court of Appeal erred in law and occasioned a miscarriage of justice by refusing to strike out the suit of the 1st respondent at the Federal High Court or nullify the judgments entered in the suit by the trial Judge but instead held that the judgment sum awarded by the trial Judge against the cross-respondent as outstanding fees for services rendered is valid and stands.
The Preliminary Objection of the 1st cross-respondent/objector needs be considered first.
PRELIMINARY OBJECTION
The objector contends that there is no cross appeal as no extension of time was sought by the cross-appellant and since no leave was granted, the cross appeal is incompetent and the Court lacking in jurisdiction to entertain it. He cited Section 27(1) and (2) of the Supreme Court Act. That the appeal at the Court below had judgment delivered on 9/12/2014 while the cross- appeal in this Court had the cross-appellant’s brief filed on 4/11/2020, six years after the decision at the Court below.
It was also submitted that the grounds of appeal were file without leave was obtained to file same. He cited Section 233 (1) and (3) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended). He cited Madukolu Nkemdilim (1962) 2 SCNLR 341; Achonu v. Okuwobi (2017) 14 NWLR (pt.1584) 142 at 182 etc.
Learned counsel for the cross appellant debunked the assertion of the cross-respondent, stating that the cross appeal was filed within time and so competent.
He further contended that the grounds of the cross-appeal are of pure law and needed no leave to be filed. He cited Umanah v. NDIC (2016) LPELR – 42556 (SC); Onifade v. Olayiwola (1990) 7 NWLR (pt. 161) 135 etc.
By Section 233(6) of the Constitution of the Federal Republic of Nigeria 1999 (as amended) any right of appeal to the Supreme Court from the decisions of the Court of Appeal conferred by Section 233 of the Constitution shall subject to Section 236 of the Constitution, be exercised in accordance with any Act of the National Assembly and Rules of Court for the time being in force regulating the powers, practice and procedure of the Supreme Court. The Supreme Court Act is an Act of the National Assembly by extant provisions of the law. Under Part VI of the Supreme Court Act dealing with “procedure”, Section 27(1) and (2) of the Act provides as follows:
27(1) “Where a person desires to appeal to the Supreme Court he shall give notice of appeal or notice of his application for leave to appeal in such manner as may be directed by rules of Court within the period prescribed by Subsection (2) of this Section that is applicable to the case. ”
27(2) “in an appeal in a civil case, fourteen days in an appeal against an interlocutory decision and three months in an appeal against a final decision.”
The case from which the cross-appellant’s purported cross-appeal emanates is a civil case. The decision of the Court of Appeal from which the purported cross-appeal emanates is a final decision of the Court of Appeal. The said final decision of the Court of Appeal was delivered by the Court of Appeal on 9th December 2014 over six (6) years ago. No extension of time was sought by the Cross-Appellant and none was granted by the Supreme Court. In the circumstances therefore, there is no Cross-Appeal before the Supreme Court with respect to which the jurisdiction of the Supreme Court ought to be invoked to consider the Cross-Appellant’s Brief of Argument that has been filed before the Court on 4th November, 2020 and the Notice of Cross Appeal filed on 9/3/2015, a period of 92 days.
The law is trite, that the Supreme Court like any other Court is competent to entertain or hear appeals or complaints of any litigation before it if, among other things, the case that comes before it was or has been initiated by due process of law and upon fulfilment of any condition precedent to the exercise by it of its jurisdiction. It follows, therefore, that the Notice of Appeal for every ground of appeal therein, shall strictly comply with either the enabling statute or the Rules of Court, failing which the appellate Court cannot exercise jurisdiction over the appeal. In the instant case, the cross-Appellant has failed to file its Notice of Cross-appeal in the purported Cross-Appeal before the Honourable Court within the time limit stipulated by the extant law and therefore, the Supreme Court ought not to exercise jurisdiction over the Cross-Appeal with respect to which the Cross-Appellant’s brief of argument has been filed.
The Notice of Cross appeal needed to strictly comply with the provision of Section 233(3) of the Constitution requiring leave to appeal in view of the effluxion of time to appeal within time and failing so the Court cannot exercise jurisdiction over the appeal. See Madukolu v. Nkemdilim (1962) 2 SC NLR 341; Achonu v. Okuwobi (2017)14 NWLR (pt.1584) 142 at 182.
In Abubakar v. Dankwambo (2015) 18 NWLR (Pt. 1491), Page 213 at 234-236, paras. G-A, this honourable Court held that where leave, which means permission, is a condition precedent before an appellant can file a notice of appeal containing grounds of mixed law and facts, an appellant who files a notice of appeal without obtaining the pre-condition would have his process thrown out and that the notice of appeal filed by the appellant in the appeal was correctly struck out by the Court of Appeal since the appellant did not seek and obtain leave before filing the notice of appeal. I refer to similar decision of the honourable Court in Allanah v. kpolokwu (2016) 6 NWLR (pt.1507) 1.
Clearly the Preliminary Objection on the competence of this cross-appeal succeeds and is upheld. The cross appeal being incompetent without a possibility of redemption is therefore struck out.
Finally, the main appeal succeeds in part as I earlier stated. The cross-appeal fails and is struck out.
Costs of N2,000,000 to the 1st respondent to be paid by the appellant.
SC.310/2015
