Cotecna International Limited Vs Ivory Merchant Bank Limited (2006)
LAWGLOBAL HUB Lead Judgment Report
TOBI, J.S.C.
Pagade Agricultural Processing Ind. Limited and Pagade Holding Limited, which I refer to as the Pagades, bought a crumb rubber processing machinery from Ivory Merchant Bank Limited for the purpose of equipping their crumb rubber manufacturing plant in Delta State. The Pagades said that the machinery was sold by Ivory to them upon material representations made by Ivory on the quality, merchantability and fitness. The Pagades said that the representations turned out to be false and they brought an action for breach of contract against Ivory at the High Court of Lagos State.
Ivory in its defence denied the existence of a contract. In the alternative, Ivory pleaded that the representations were innocently made based on the negligent or fraudulent misrepresentations made by Cotecna International Limited to Ivory. Ivory commenced Third Party Proceedings against Cotecna by the issuance of a Third Party Notice seeking contribution or indemnity from Cotecna in respect of the Pagades claim.
Cotecna filed a defence and also raised a preliminary objection on the jurisdiction of the High Court of Lagos State to hear the matter. Cotecna prayed the court to strike out the Third Party Proceedings on the ground of lack of jurisdiction by the court to hear the proceedings.
The High Court heard the preliminary objection and dismissed it. Dissatisfied Cotecna appealed to the Court of Appeal. That court dismissed the appeal. Cotecna has appealed to this court. Briefs were filed and duly exchanged. The appellant, Cotecna, formulated two issues for determination:
“1. Whether the Court of Appeal was right when that court held that the High Court of Lagos State was right to have assumed jurisdiction over the subject matter of the Third Party Notice, the proceedings on which were under the Pre-shipment Inspection of Imports Act.
- Whether the judgment of the Court of Appeal was a nullity having been delivered a month earlier than the adjourned date for its delivery without notice to the Appellant and the other parties.”
Ivory, as 1st respondent/cross-appellant, formulated one issue for determination:
“Whether the Court of Appeal was right in confirming the decision of the Lagos High Court that it had jurisdiction to hear the 3rd party notice against the appellant, being an ancillary claim which travels with the principal claim is cognizable in the State High Court.”
The Pagades, as 2nd and 3rd respondents, formulated two issues for determination:
“(i) Whether the High Court of Lagos State had jurisdiction over the Third Party Proceedings brought in the case.
(ii) Whether the judgment of the Court of Appeal was a nullity having been delivered on a date earlier than the adjourned date for its delivery without notice to the appellant. ”
Learned counsel for the appellant, Mr. Uzoma Azikiwe, submitted on issue No.1 that the Court of Appeal came to correct interpretation of section 9(2) of the Pre-shipment Inspection of Imports Act, 1985 and the only decision available to that court was to hold that the High Court of Lagos State lacked the jurisdiction to adjudicate on the subject matter of the Third Party Proceedings. The decision reached by the Court of Appeal amounts to judicial amendment of statutory provisions, learned counsel submitted. He contended that under the Nigerian legal system and the Constitution, the courts have the jurisdiction or power circumscribed by provisions of the Constitution and statutes to abridge, constrict or even oust the jurisdiction of the court. He cited Attorney-General of Lagos State v. Dosunmu (1989) 3 NWLR (Pt.111) 552 at 567.
Counsel argued that Nigerian court exists to expound and not to expand their jurisdiction outside the limits prescribed by statutes. He cited Seaview Investments Limited v. Munis (1991) 6 NWLR (Pt.195) 67 and Adeniyi v. Oroja (1992) 4 NWLR (Pt.235) 322.
On the issue of jurisdiction over a principal claim, learned counsel submitted that the case of Tukur v. Government of Gongola State (1988) 1 NWLR (Pt.68) 39 cited by the Court of Appeal is so fundamentally different from the case before the court, that it is no authority for conferring jurisdiction on the High Court of Lagos State. Counsel took time to bring out the difference between the case of Tukur and this appeal. Counsel referred to African Continental Bank Ltd. v. Wali Jallo (1975) 5 SC. 89 at 100; Union Bank of Nigeria Ltd. v. Alhaji Bisi Edionseri (1988) 2 NWL(Pt.74) 93 at 103 and Central Bank of Nigeria v. Manexport S. A. (1987) 1 NWLR (Pt. 47) 86 at 96.
Learned counsel quoted at paragraphs 5.6 and 5.7 of his brief statements made by the Court of Appeal which appeared to him to be outside the issues submitted by the parties for determination. Citing Zungkat Retduwas v. Dakyep lwan (1992) 8 NWLR (Pt.259) 358 at 367; Ochonma v. Unosi (1965) NMLR 321; UBA Ltd. v. Achoru (1990) 6 NWLR (Pt.l56) 254; Olujitan v. Oshatoba (1992) 5NWLR (Pt.241) 326 at 334 – 335; Ezeugo v. Ohanyere (1978) 6 7 SC 171,. Umeji v. Attorney-General of Imo State (1995) 4 NWLR (Pt.391) 552 at 620, learned counsel submitted that courts exist to decide disputes between parties who come before them and do not make it their business to set up disputes different from the controversies on which the parties have joined issues.
On issue No.2, learned counsel submitted that delivery of the judgment earlier than scheduled without notice to the appellant is a violation to the appellant’s right to fair hearing as guaranteed under section 36(1) of the Constitution. He cited Nigeria-Arab Bank Limited v. Barri Engineering Nigeria Limited (1995) 8 NWLR (Pt.413) 257 at 290. He urged the court to hold that the judgment delivered on 24th May, 2000 earlier than the scheduled 19th June, 2000 without notice to the appellant is a nullity. He urged the court to allow the appeal.
Learned counsel for the 1st respondent, Mr. Norrison Quakers, submitted that issue No.2 which the appellant raised did not arise from the judgment of the Court of Appeal but a procedural irregularity which has not occasioned a miscarriage of justice. Accordingly, if the appellant is to argue the issue, the leave of this court must be obtained, counsel contended. To learned counsel, issue No.2 goes to no issue as the appellant failed to obtain leave of this court to raise and argue it.
Arguing the only issue raised in his brief, learned counsel submitted that the 3rd party proceedings are not proceedings under the Pre-Shipment Inspection of Imports Act for the reason that section 9(2) of the Act applies to the exercise of jurisdiction of the Federal High Court in relation to criminal proceedings provided for under sections 7 and 8 of the Act.
On the effect of jurisdictional problems in principal and ancillary claims, learned counsel pointed out that the principal issue that this appeal raises is whether it was appropriate to join the appellant to the suit at the lower court. A claim based on liability in an unqualified clean report of findings involves a tortious liability of negligence which is not an exclusive preserve of the Federal High Court but the High Court of a State, counsel argued. He submitted that the trial court in the exercise of its jurisdiction rightly entertained the 3rd party notice being an ancillary claim to the principal claim. He cited Tukur v. Government of Gongola State (supra)
Learned counsel for the 1st respondent took appellant’s issue No.2 in the alternative, that is, in the event that this court comes to the conclusion that leave was not necessary. Counsel submitted that the appellant did not suffer anything as a result of its absence on the date judgment was delivered and that the case of Nigeria-Arab Bank Limited v. Barri Engineering Nigeria (supra) cited by the appellant is inapplicable to the facts of this case.
On the cross-appeal whether section 9(2) of the Pre-Shipment Inspection of Imports Act applies to the 3rd party proceedings, learned counsel submitted that the Court of Appeal misconceived the provisions of the subsection in holding that it applies to the 3rd party proceedings, as the marginal notes of section 9 relate to criminal proceedings. Clearly, a claim for negligence pursuant to a statement contained in a clean report of findings is not a claim under the Act and can, therefore, be instituted in the State High Court, counsel contended. He cited S. G. S. v. Rastico (1987 – 1990) 3 N.S.C. without the page.
Learned counsel submitted that the appellant is not an agency of government to take advantage of the provisions of the Act. To learned counsel, for the appellant to qualify as an agency of government it must show that it is an organ of government created by statute to carry out government functions or objectives. He urged the court to dismiss the appeal.
Learned counsel for the 2nd and 3rd respondents, Mr. Olawale Akoni, submitted on issue No.1 that the Court of Appeal was correct when it held that the Third Party Proceedings was a proceeding under the Act; thus permitting the Third Party Proceedings to continue in the High Court of Lagos State. He relied on Tukur v. Government of Gongola State, supra. He submitted that a third party proceedings cannot come about without the existence of a main action between a plaintiff and a defendant. He called in aid Order 14 rule 22 of the High Court of Lagos State Rules. He argued that the third party proceeding is ancillary to the main action between Pagade and Ivory.
On issue No.2, learned counsel submitted that as the date for the delivery of a judgment of a court is a matter entirely within its discretion, the judgment delivered by the Court of Appeal on 24th May, 2000 was valid and not a nullity. He urged the court to dismiss the main appeal and allow the cross appeal. In his reply brief, learned counsel for the appellant submitted that the validity of the judgment of the Court of Appeal raised by the appellant relates to and arises out of the judgment, subject of this appeal, and so leave was not required to raise same. He contended that the issue of agency raised by the cross-appellant is a fresh issue which needed the leave of the court to raise. He urged the court to strike out ground two in the cross-appellant’s notice of appeal and all issues and arguments based on the ground. He relied on Oforlete v. The State (2000) 12 NWLR (Pt.681) 415 and Uor v. Loko (1988) 2 NWLR (Pt.77) 430.
I should start from section 9(2) of the Pre-Shipment Inspection of Imports Act, 1985. It reads:
“Every proceedings under this Act shall, subject to the applicable procedure to be commenced in the Federal High Court and references in this Act to “court” shall be construed accordingly.”
Construing the subsection, the Court of Appeal said at page 329 of the record:
“The words of section 9(2) above are clear, plain and unambiguous. I ought therefore to construe them in
accordance with their ordinary meaning…. When so construed, the only conclusion to be arrived at is that if the matters raised in the third-party notice issued by the appellant were proceedings under Cap. 363 above, only the Federal High Court could adjudicate in the matters… I am satisfied therefore that the proceedings before the lower court on the 3rd party notice were proceedings under the Pre-shipment Inspection of Imports Act, 1985.”
The Court of Appeal cannot be faulted in the above conclusion because it is valid and correct. The court correctly relied on Orubu v. National Electoral Commission (1988) 5 NWLR (Pt.94) 323; Ojokolobo v. Alamu (1987) 3 NWLR (Pt.61) 377 and African Newspapers Ltd. v.Federal Republic of Nigeria (1985) 2 NWLR (Pt.6) 137.
In Ojokolobo v. Alamu, supra, this court held that if the language used by the Legislature is clear and explicit the court must give effect to it because in such a situation the words of the statute speak the intention of the Legislature. That is the correct interpretation of the law. The rationale behind that interpretation is that the legislature as the law maker must be trusted to use the correct and appropriate language and must be credited as the owner of parliamentary language that it will always use the language correctly and appropriately, unless the contrary is proved. It is saying the obvious that words are the tools of the legislature and that the courts recognize that they use the language suitable in a statute.
As the role of the legislature is that of making the law, or law making, the role of the Judiciary is that of interpretation of the law. Therefore where the language of a statute is clear, unambiguous, not subject to alternative interpretation, the courts must give the words their ordinary meaning. This accords with what this court said in Ojokolobo that words of a statute speak the intention of the legislature. Where the language of a statute is clear and unambiguous, courts have no jurisdiction to introduce interpretation or construction not borne out from the clear and unambiguous language. That will be interfering with the exclusive domain of the legislature as the law-maker.
The moment the Court of Appeal came to the correct conclusion it did, no other conclusion was available to it. But the court went further and examined whether the relief claimed in the Third-Party Proceedings was the principal or ancillary relief. In dealing with the issue, the court argued at page 332 of the record:
“The plaintiff’s claim before the lower court was for a breach of contract of sale. The lower court had the necessary jurisdiction to adjudicate in the dispute between the plaintiff and the defendant. It was the Third Party Notice by the defendant which amounted to proceedings under the Pre-Shipment Inspection of Imports Act, Cap. 363 over which only the Federal High Court had jurisdiction. I do not think that it would have been a correct approach for the lower court to have assumed jurisdiction over the principal claim of the plaintiff and to decline jurisdiction over the third party notice. By the third-party notice, the purpose of the defendant was to obtain indemnity or recompense from the 3rd party in the event the lower court gave judgment against the defendant. If the plaintiff’s claim before the lower court failed, there would be no basis or purpose for the further pursuit of the 3rd party notice. Clearly therefore the claim of the plaintiff against the defendant was the principal claim whilst that of the defendant was the accessory or ancillary claim.”
The Court of Appeal in coming to the conclusion that the High Court was right to have assumed jurisdiction in the matter, relied on what this court said in Tukur v. Government of Gongola State, supra.
Let me quote a portion of it:
“The fons et origo of his complaint in the determination of which he ought to have been accorded a fair hearing is not one over which the Federal High Court has jurisdiction. In this respect, the appellant’s right to a fair hearing is merely an accessory right. The principal right is his right not to be unjustly deposed. His right to a fair hearing before that deposition is an accessory right. The maxim here is accessorium sequitur principale an accessory thing goes with the thing to which it is accessory. Now if the principal right can only be litigated upon and maintained in the State High Court of unlimited jurisdiction, then the accessory right to a fair hearing with follow the principal right to its forum competens the State High Court.”
With respect, I do not agree with the Court of Appeal. Tukur cannot be authority in the case. It is clear in Tukur that the principal relief was the wrongful deposition of the appellant which made his right to fair hearing as an accessory right. This court had no difficulty to come to that conclusion because the dividing line was clear.
While there are cases where the dividing line between principal and ancillary reliefs is clear and obvious, there are also cases where the line is not clear and obvious. In the latter case a court of law cannot so dichotomize. In matters such as this, the court must be involved in measuring the relief with a view of finding out where the pendulum tilts. Measuring from the baseline to where the pendulum tilts, will give a rough arithmetical answer to the court in terms of whether the relief is principal or ancillary.
There is need to take the third party notice. It reads:
“A. COTECNA INTERNATIONAL LIMITED are Overseas Pre-Shipment Inspectors appointed by the Federal Government of Nigeria pursuant to the Pre-Shipment of Imports Act, 1981. Upon inspection of the crumb rubber machinery which is the subject matter of this action by the plaintiff against the defendant, COTECNA INTERNATIONAL LIMITED issued an unqualified Clean Report of Findings (C.R.P.) which showed that the machinery was new and that its country of origin was Japan.
B. …
C. …
D. …
E. By reason of A-D above, COTECNA INTERNATIONAL LIMITED acted in breach of its duty as pre-shipment inspection agents and were negligent or fraudulent in misrepresenting the state of the said machinery to the defendant.
Particulars of negligence
i Failing to take proper or any care to determine the state of the Machinery before issuing the Unqualified Clean Report of Findings (C.R.F.) which showed that the machinery were new.
ii. Failing to see that the defendant was likely to suffer damage by placing reliance on the Clean Report of Findings (C.R.F.) issued without proper or any care in determining the actual state of the said machinery.”
It is clear from the third party notice that the act of negligence emanated from the breach of duty of care arising from performing the duty of pre-shipment inspection agents. This is the expression of above. In my humble view, it is the act of negligence that is parasitic or appurtenant to the duty of pre-shipment. In other words, the dominant claim in the third party notice is the breach of duty of pre-shipment. That is certainly and undoubtedly the principal relief if such a distinction is really necessary.
In the light of my conclusion on issue No.1 in favour of the appellant, I do not intend to take issue No.2. The appeal succeeds and it is allowed. The cross appeal is dismissed. The judgment of the Court of Appeal is hereby set aside. The third party action pending at the High Court of Lagos State, which has no jurisdiction to entertain it, is hereby struck out. I award N10,000.00 against the respondents in favour of the appellant.
SC.313/2001
