Franchal (Nig.) Ltd. & Anor V. N.A.B. Ltd. (2000)
LAWGLOBAL HUB Lead Judgment Report
UWAIS, C.J.N.
This is an interlocutory appeal against the decision of the Court of Appeal refusing an application by the appellants for stay of execution pending appeal. The background facts to the case are as follow. The appellants were indebted to the respondent. On 29 October, 1993 the respondent took out a writ of summons in the erstwhile High Court of Anambra state holden at Onitsha. The case was placed on the undefended list. The respondent’s claim against the appellants was for:
“(a) N39,053,312.89 (Thirty-nine Million, fifty-three thousand, Three Hundred and Twelve Naira, Eighty-nine Kobo) being the balance of the principal sum of overdraft granted to the first defendant (1st appellant) and personally guaranteed by the second defendant (2nd appellant).
(b) N32,575,004.67 (Thirty-two Million, Five hundred and seventy five thousand, four naira, sixty-seven Kobo) being interest, commissions and other bank charges which accrued to the principal sum of N129,780,976.52.
(c) 40% compound interest on the principal sum and already accrued interest from 1st October, 1993 until the date of judgment.
(d) 5% simple interest on the judgment debt from the date of judgment until it is finally liquidated.” The 1st appellant was served with the writ of summons on 29th October, 1993 while the 2nd appellant was served on the 2nd November, 1993 by substituted service. The case came up for hearing before Nwofor J. on the 11th November, 1993 and all the parties to the case were represented by counsel. In the case of the appellants, they were jointly represented and their counsel file a memorandum of appearance earlier on the day in question. After considering and resolving some preliminary objections on procedure raised by learned counsel for the defendants, the learned trial judge ruled as follows:
“It is my view that all the issues raised by the defendants as their defence to the sum of N39m claimed are not defence on merit and are merely being raised to dribble this action. The case of Nal Merchant Bank Ltd. v. Macaulay (1986) 5 NWLR(Pt.40) 216 C.A., (1986) 7 C.A. (Pt. 111) 59-60 provides as follows: See also Chief B.C. Agueze v. Pan African Bank Ltd. (1992) 4 NWLR (Pt.233) 76. These cannot but apply the principles established in these cases on this case and refuse the application in respect of the defence to the amount of N39,000,000.00 claimed and strike out the application by the defence in respect of that claim.
In respect of the N32,575,004.67 being the amount of interest and commissions etc. I shall let in the defendants to defend this claim. The same goes for the claim of 40% compound interest because it is the rate of interest that determines the amount of interest. This decision is based on defendants defence that their agreement was 11% simple interest and not compound interest. I shall therefore enter judgment for the plaintiff for N39,053,312.89 against the defendant jointly and severally. The condition in which the defendant will be let in to defend the amount of interest and the rate of interest as per paragraphs B and C of the plaintiff’s claim is that they pay the plaintiff the sum of N29,000,000 immediately and the balance of N10,053,312.89 to be paid when the amount of interest is ascertained. This condition is made pursuant to Order 24 Rule 9 (3) of the High Court Rules of Anambra State, 1988.”
Thereafter the defendants brought a motion on notice seeking an order of the High Court for a stay of execution pending the appeal which they filed to the Court of Appeal. The motion which was heard on 10th February, 1994 was refused by the learned trial Judge on 21st February, 1994.
Next, the defendants filed another motion on notice in the Court of Appeal asking for a stay of execution pending the determination of the appeal before it. The motion was heard on the 26th May, 1994 and ruling reserved. The ruling was delivered on the 22nd June, 1994. In dismissing the application, the Court of Appeal (Achike, J.C.A., (as he then was, Akintan and Adamu JJ.C.A,) held, as per Akintan J.C.A. thus:-
“The main question to be resolved in the instant case therefore is whether from the facts disclosed in the various affidavits in support of the application, the grounds of appeal filed against the verdict (sic) of the court as well as all the circumstances of the case, the applicants have made a case warranting the exercise of this court’s discretion in their favour. It is trite law that a discretion to grant or refuse a stay of execution must take into account the competing rights of the parties to justice. A discretion that is based in favour of an applicant for a stay but does not adequately take into account the respondent’s equal right to justice, is a discretion that has not been (sic) judicially exercised. (See Mobil Oil Ltd. v. Agadaigho, (1988) 2 NWLR (Pt.77) 383 and Okafor v. Nnaife, (supra) (1987,4 NWLR (pt.64) 129.
The respondent in the instant case is a licenced (sic) commercial bank. The 1st applicant is a company incorporated in Nigeria and maintains a bank account with the Onitsha branch of the respondent bank. The 2nd applicant is the Chairman/Managing Director of the 1st applicant company. He is the man behind the company. The claim before the (High) Court was founded on credit facilities granted by the bank to the 1st applicant which the 2nd applicant guaranteed. One of the undisputed facts place before the trial court is that the total amount of money granted to the 1st applicant and guaranteed by the 2nd applicant was over N130 million. The 2nd applicant admitted this fact in an affidavit he swore to and placed before the trial court. He also admitted that out of that amount, over 80% of the sum has been paid. He then averred that only N29 million was still outstanding. In other words, the 2nd applicant admitted that N29m was still owed to the Bank. That was the amount which the court ordered the applicants to pay to the respondent.
The question therefore is whether it is equitable for this court to grant a stay of execution of the portion of that judgment ordering the applicants to pay N29m which the applicants admitted owing the respondent while proceeding with the rest of the claim disputed. My answer to that question is definitely in the negative. The grounds of appeal filed against the judgment of the court have nothing to do with the issue of the amount which the 2nd applicant admitted as the balance due on the transaction …
A ground of appeal alleging that the court awarding not what was claimed cannot therefore be said to raise any substantial issue for determination by this court.
Another point raised is that in view of the heavy sum involved (N29million) it was not possible for the applicant to pay the said sum and yet continue in business. That averment was controverted by the respondent in it counter-affidavit in which its was deposed that the 2nd applicant is a very wealthy man with heavy investment in so may successful enterprises, and has recently founded an airline company. The averment about the extent of his massive wealth was not controverted. Even if it is controverted, (sic); the applicants still need to show more than merely establishing that they were unable to pay, by establishing that by making payment, they would be unable to prosecute their appeal or that they would be unable to recover any money paid to the respondent in the event of their appeal succeeding.
In conclusion, therefore and for the reasons given above, I hold that the applicants have failed to make out a case to warrant granting a stay of execution of the judgment as they prayed for in their motion. The motion is accordingly dismiss (sic) with N1,500 costs in favour of the respondent.” (Parenthesis and Italics mine)
The applicants were not satisfied with the ruling of the Court below. They therefore appealed from it to this court. Only the appellants filed brief of argument in which they raised four issues to be determined by this court, viz:-
“1. Did the Court of Appeal base its Ruling on exhibit “Q” (which is an uncertified affidavit allegedly deposed to by the 2nd appellant and used in a different suit (O/12/121M/92 wherein the appellants allegedly admitted owing the respondent N29million) and if they did was it proper ()
- Did the Court of Appeal hold that the 2nd appellant placed before the Onitsha High court an affidavit (exhibit Q) wherein he admitted owing the respondent N29 million which necessitated the refusal of the motion for stay of execution pending appeal and if they did was it proper ().
- Did the Court of Appeal in its ruling base the refusal of the motion for stay of execution pending appeal on the ground that the respondent’s massive averment, about the extent of the appellant’s wealth were never controverted and that the appellants did not establish that by making the payment, they would be unable to prosecute their appeal, and if they did was it proper ().
- Was it proper for the Court of Appeal to refuse the said motion for stay of execution pending an appeal when the Record of Appeal relating to the substantive case had been forwarded to it and parties thereto are about to exchange their briefs of argument. ().
(parenthesis mine)
The respondent failed to file its brief of argument. When the case came up for hearing before us on the 6th day of March, 2000 neither of the parties was represented by counsel nor was the 2nd appellant present in court. Consequently we relied on the provisions of Order 6 rule 8 (7) of the Supreme Court Rules, 1985 to deem the appeal argued on the appellants’ brief of argument only. The rule provides:-
“(7) When an appeal is called, and it is discovered that a brief has been filed for only one of the parties and neither of the parties concerned nor their legal practitioners appear to present oral argument, the appeal shall be regarded as having been argued on that brief.”
I intend to consider issues nos 1 and 2 together as they are interrelated. Appellants complaint is that the Court of Appeal in refusing their application for stay acted improperly by relying on the content of an affidavit (Exhibit Q) in another case different from the present case, to hold that the 2nd appellant admitted being indebted to the respondent in the sum of N29m. It is argued that Exhibit Q, being part of the record of proceedings in the earlier case suit No. 0/121m/92, was improperly before the Court of Appeal since it was not certified, being part of a public document, as a true copy of the original affidavit in accordance with the provisions of sections 110, 111 and 113 of Evidence Act. That the trial Court relied on Exhibit Q in giving judgment in favour of the respondent, that one of the appellants’ grounds of appeal against the judgment of the High Court averred that Exhibit Q was not properly before the High Court and that it was not consequently admissible evidence on which the High Court could rely to give judgment for the respondent. Had the court of Appeal adverted to this, it would have come to realise that the trial court acted wrongly and this was a ground on which the appellants’ appeal could succeed and so for that reason the Court of Appeal should have granted the stay of execution sought. The following cases are cited to buttress the contention – Anyakora v. Obiakor (1990) 2 NWLR (Pt.30) 52 at 56 and 57 (head note nos. 10 and 13); Hada v. Malumfashi (1993) 10 KLR 102 at 104 (ratio no. 8); (1993) 7 NWLR (pt.303) 1; Fatuade v. Onwoamanam (1990) 2 NWLR (Pt.132) 322 at 325; Oko v. Ntukidem (1993) 3 NWLR (Pt.274) 124 at 126 and 128 (ratio nos 1 and 6) and Obadina & Anor v. Ambrose (1969) 1 NMLR 24.
It is contended that although the respondent, subsequent to the judgment of the High Court and the filing by the appellants of application in the High Court for stay of execution pending appeal, had caused Exhibit Q to be certified as a true copy, that that had not altered the fact that the judgment of the High Court in the undefended list was based on inadmissible evidence. The appellants argue that the Court of Appeal misdirected itself when, in its reasoning for refusing to grant stay, it stated that it was the 2nd appellant that deposed to Exhibit Q admitting that the appellants were indebted to the respondent in the sum of N29m. On the contrary, it is submitted, it was the respondent that exhibited Exhibit Q in its affidavit in support of its claim in the trial court. That the appellants did not at any time file any document in the High Court in which they admitted the debt of N29m nor did they file Exhibit Q in the High Court.
Now, I think there is some confusion in the minds of the appellants with regard to Exhibit Q. While it is true that the respondent annexed Exhibit Q to his affidavit in support of the claim on the undefended list (when it was not certified as a true copy of the proceedings in Suit No. 0/121m/92 – Chief Francis Nzekwesi v. Inspector-General of Police & Ors) the same document was exhibited as certified document to the counter-affidavit opposing the application in the Court of Appeal by the appellants for stay of execution pending determination of the appeal to that court. So that as far as the proceedings in the Court of Appeal for stay were concerned, Exhibit Q was a certified document properly before the Court of Appeal. Paragraph 5 of the counter-affidavit, sworn to by an employee of the respondent (Wisdom Ngozi Nwabueze Nwachukwu) states:-
“5. That paragraph 8 (of the appellants’ affidavit in support of their application in the Court of Appeal for stay of execution) is correct only to the extent that the court ruled that in matters coming under the undefended list memorandum of appearance was not appropriate and entered judgment based on the admission of the defendants in Exhibit Q, a certified copy of same which is annexed and marked Exhibit A.
while paragraph 5 of the Further Affidavit of Mr. Cletus Okolo, Manager of the 1st appellant states as follows:-
“5. That paragraph 5 of the counter-affidavit of the plaintiff/respondent is false. In further answer to the said paragraph 5, I hereby state that Exhibit “A” attached to the counter-affidavit of the defendant was used in Suit No. 0/121m/92 during the Enforcement of Fundamental Rights proceedings and the alleged admission therein was never contained in the applicant’s notice of intention to defend the relevant suit. (i.e .. No. 0/338/93)”.
At the stage when Exhibit Q was annexed to the respondent’s counter-affidavit the Court of Appeal was concerned not with the appeal challenging the decision of the trial judge but the application before it for a stay of execution to be granted. Since at that stage Exhibit Q had been certified as true copy of the proceedings in suit No. 0/121m/92, the contention of the appellants about its value as evidence is misdirected and irrelevant to the appeal before us. The same argument might be relevant to the appeal before the Court of Appeal in respect of the decision of the High Court but then it has to await the hearing of the appeal in that court, if not yet determined.
It follows that I see nothing wrong in the Court of Appeal acting on the admission made by the 2nd appellant in Exhibit Q to the effect that the appellants were indebted to the respondent in the sum of N29m. Consequently there is no merit in issues nos. 1 and 2 in the appellants’ brief of argument.
With regard to issue nos 3, the appellants contend that the Court of Appeal refused to grant their application on the ground that they did not controvert the assertion by the respondent’s counter-affidavit that the 2nd appellant was extremely wealthy. They submitted that the Court of Appeal acted erroneously since they abundantly showed in all the affidavits sworn to by them that they denied that they were very wealthy and went on to show that the payment of the judgment debt would not only cripple them but also deny them the resources to prosecute the appeal in that court. In support of the submission they refer to their affidavit of 21st February, 1994 and their Further Further Affidavit of 21st April, 1994 (both in support of their application in the Court of Appeal for stay of execution).
I agree that the Court of Appeal misdirected itself when it held- “The averment about the extent of this massive wealth was not controverted”, Paragraphs 21 and 22 of the affidavit in support of the application in the Court of Appeal for stay of execution aver as follows:-
“21. That before the defendants can satisfy en bloc the said judgment debt of twenty nine million Naira, it will mean disposing off (sic) all their assets and the exercise will not only stifle (sic) the defendants but will also deprive them of the resources for the prosecution of the said appeal.
- That there is economic recession in the country and the companies are finding it difficult to put their heads above water and the first defendant is not an exception.”
And paragraph 7 and 8 of their Further Further Affidavit state thus:-
“7. That paragraph 14 of the counter-affidavit of the plaintiff is false. In further answer to the said paragraph 14, I hereby state that there was never a time the 2nd defendant/applicant floated an airline. Exhibit “B” attached to the counter-affidavit to the defendant/respondents (sic) was fabricated for the purposes of this motion.
- That paragraphs 15,16,17,18,19 and 20 of the counter-affidavit of the defendant/respondent (sic) are false and untrue. In further answer to the said paragraph 15, I hereby state that the evacuation of all the property of the 2nd defendant/applicant to the High Court, Onitsha has further crippled the 2nd defendant/applicant financially who now lives on charity”.
This notwithstanding, appellants application for a stay was brought under the provisions of sections 16 and 18 of the Court of Appeal Act and the Court of Appeal stated in its judgment the principles governing the granting of stay of execution pending appeal. It observed thus:-
“The main question to be resolved in the instant case therefore is whether from the facts disclosed in the various affidavits in support of the application, the grounds of appeal filed against the verdict of the court as well as all the circumstances of the case, the applicants have made a case warranting the exercise of this court’s discretion in their favour. It is trite law that the grant of stay of execution involves the exercise of discretion which involves a consideration of the chances of the applicant’s ability to satisfy the judgment debt if the appeal is unsuccessful and the general rule to maintain the status quo between the parties are also important considerations. See Intercontractors Nig. Ltd. v. U.A.C. Ltd. (1988) 2 NWLR (Pt.76) 303; Odufoye v. Fatoke (1975) I NMLR222;Shoge v. Musa (1975) 1 NMLR 133; Wey v. Wey (1975)1 SC 1 and Balogun v. Balogun (1969) 1 All NLR 349…”
The Court then considered the admission by the appellants of their indebtedness to the respondent in the sum of N29 million and examined the grounds of appeal in the appeal pending before it, thus:-
“One of the undisputed facts placed before the trial court is that the total amount of money granted to the 1st applicant and guaranteed by the 2nd applicant was over N139m. The 2nd applicant admitted this fact in an affidavit he swore to and placed before the trial court…
He then averred that only N29m was still outstanding. In other words, the 2nd applicant admitted that N29m was still owed to the bank. That was the amount which the court ordered the applicants to pay to the respondent… The grounds of appeal filed against the judgment of the (trial) court have nothing to do with the issue of the amount which the 2nd applicant admitted as the balance due on the transaction.”
It is based on these considerations that the Court of Appeal came to the conclusion that-
“The question therefore is whether it is equitable for this court to grant a stay of execution of the portion of that judgment ordering the applicants to pay the N29m which the applicants admitted owing the respondent while proceeding with the rest of the claim disputed. My answer to that question is definitely in the negative.
It is undoubtedly clear from the forgoing that the Court of Appeal did not rely on the misdirection, about the 2nd appellant not controverting the allegation that he was ‘massively wealthy’, to refuse to grant stay of execution, In my opinion the misdirection did not occasion any miscarriage of justice. The final issue for consideration is issue no 4 which complains that the Court of Appeal was wrong in refusing stay when the record of appeal was already in its possession. The case of Fawehinmi v. Akilu (1990) 1 NWLR (Pt.l27) 450 at p.460 (headnote No.9) is cited in support. With respect, I do not see any merit in this submission. Merely the record of proceedings being in possession of court is no ground for granting stay of execution. The case cited does not establish that fact. The headnote (No.9) to which the appellants refers states:
“The fact that the record of appeal is now before the Court of Appeal and parties are about to exchange briefs go to establish that a stay of execution would not occasion undue delay,”
The issue in the present case whose facts are distinguishable from those of the cases cited, has nothing to do with the granting of stay occasioning any delay. It is lazy for counsel to rely on headnotes in law reports instead of reading the whole of the facts of the case he is relying on to see how relevant the decision in the case is to his own case. I see no merit in this issue.
On the whole the appeal fails and it is hereby dismissed with no order as to cost. It is hereby directed that the appeal, if pending before the Court of Appeal in the substantive case since 1994, should be given accelerated hearing.
SC.186/1994
