Jimi Oduba Vs C.v. Scheepv Aartonderneming Hautmangracht & Anor (1997)

LAWGLOBAL HUB Lead Judgment Report

IGUH, J.S.C.

What calls for decision in this appeal is whether or not the Court of Appeal was right in setting aside the order of the High Court of Lagos State that the plaintiffs do give security for the defendant’s costs in the sum of $84,279.76 (Eighty-Four Thousand, Two Hundred and Seventy Nine U.S. Dollars Seventy-Six Cents) with N10,000.00 (Ten Thousand Naira) and that further proceedings by or on behalf of the plaintiffs in the suit be stayed until the said security is given.

It is, perhaps, convenient for a better appreciation of the issue that arises for consideration in this appeal to set out briefly the background facts to the dispute between the parties. The plaintiffs are foreign limited liability companies. Their case as pleaded, is that the 1st plaintiff retained the professional services of the defendant, a legal practitioner, to defend its interest in Suit No. FHC/PH/27/86 pending at the Federal High Court Port Harcourt. This suit arose as a result of the collision between the 1st plaintiff’s vessel, M. V. Houtmangracht, and a police jetty on or about the 12th day of July, 1986 at Port Harcourt. Their case is that between July, 1986 and November, 1987, the defendant directed his efforts towards achieving a settlement of the claims made by the owners of the jetty and other properties and that Court appearances comprised mainly of adjournments for report of settlement out of court.

The plaintiffs claimed that during the pendency of the said proceedings, the defendant sent notes of his fees to the 1st plaintiff for various sums which were duly settled. These payments were effected on the 5th November, 1986, and the 17th July, 1987 in the sum of U.S. $40,520.00 and U.S. $57,360.00 respectively by the 1st plaintiff. The amounts were lodged by the 1st plaintiff into the defendant’s bank account at the Barclays Bank PLC International Services Branch, Nottingham in the United Kingdom as directed by the said defendant.

At the conclusion of his services, the defendant sent a further fee note dated the 17th of November, 1987 to the 1st plaintiff claiming pound sterling 262,683.25 Pounds and U.S. $31,932.25. This further fee, the 1st plaintiff refused to settle. As a result, the defendant commenced a legal action against the 1st plaintiff and its agents at the Federal High Court, Lagos on the 5th day of February, 1988 claiming the said fees with interest. On the same date, the defendant filed an application ex parte for the arrest and detention of the 2nd defendant’s vessel M. V. REALENGRACHT, then anchored at the Lagos Port as Security for the settlement of his claims. This application was promptly granted by the Court and the vessel, M.V. REALENGRACHT, was arrested by the Admiralty Marshal of the Federal High Court on the same 5th February, 1988. The plaintiffs case is that faced with the phenomenal losses being suffered by the 2nd plaintiff as a result of this arrest of its vessel, the 1st plaintiff was forced to agree to settle, and did infact settle the defendant’s said further fees in full with interest by paying the sum of 283,697.84 Pounds and US $34,487.83 into the defendant’s bank account in England as directed, whereupon the defendant discontinued his suit and released the 2nd plaintiff’s vessel on the 8th day of February, 1988.

The 2nd plaintiff further averred that the cost of the detention of the M.V.REALENGRACHT was in excess of sterling 20,000.00 Pounds per day and that any delay in its release would have entailed the breach of future contractual engagements of the vessel. It was also the case of the 1st plaintiff that it only paid the aforesaid further bill of charges as a result of duress occasioned by the unlawful arrest of the 2nd plaintiffs vessel by the defendant and his threat that the vessel would be inordinately delayed in Lagos and the further threat that another vessel would be arrested unless the said fees were fully paid. The plaintiffs further alleged that the defendant, a maritime legal practitioner in Nigeria, improperly and deliberately misused the machinery of the Federal High Court to enforce a claim for professional fees made against the 1st plaintiff so as to enable him to arrest a vessel belonging to the 2nd plaintiff and thereby compel the 1st plaintiff to settle his said fees. By reason of the foregoing, the plaintiffs on the 3rd day of February, 1989 filed the present action against the defendant at the High Court of Lagos State, claiming as follows:

“1. A declaration that an action brought in the Federal High Court by the defendant, who is a legal practitioner in Nigeria, to enforce a claim for fees for professional services rendered to the 1st plaintiff who is a ship owner, is not within the jurisdiction of the Federal High Court.

2. A declaration that the defendant’s application on the 5th February, 1988 for the arrest of the 1st plaintiff’s ship M.V. REALENGRACHT by order of the Federal High Court, Lagos was not sought pursuant to an action ‘in rem’ and was therefore unlawful, and an abuse of the legal and judicial process.
3. A declaration that the methods employed by the defendant to recover his fees from the 1st plaintiff were entirely contrary to the provisions of the Legal Practitioners Act, 1975, Order 51 rule 5 of the High Court of Lagos (Civil Procedure) Rules, 1972, as well as Order 47 of the “Rules of Professional Conduct” in the legal profession and are therefore unlawful.
4. A declaration that the payment of the sum of 283,697 pounds, 84 Sterling and U.S. $34,487.83 into the defendant’s account at Barclays Bank PLC, Beeston, Notts, England by the 1st plaintiff in compliance with the precondition set by the defendant for the early release of the 1st plaintiff’s aforesaid ship M.V. REALENGRACHT from arrest was made under duress.
5. An order that the said sums of 283,697 Pounds,84 Sterling and US $34,487.83 paid into the defendant’s account at Barclays Bank Plc, Beeston, Notts, England be refunded together with interest at 15% per annum from the date payment was made by the 1st plaintiff to the date when a full refund is made by the defendant.
6. An order pursuant to section 16(2) of the Legal Practitioners Act, 1975 that the bills of charges dated 29th May, 1987 and 17th November, 1987 rendered by the defendant to the 1st plaintiff be taxed.
7. An order for damages of N500,000.00 against the defendant for procuring the wrongful arrest of the 1st plaintiff’s vessel M.V. REALENGRACHT.”

The defendant’s case, in a nutshell, is that pursuant to professional services rendered, he forwarded a number of bills of charges to the plaintiffs between August, 1986 and November, 1987. The plaintiffs settled two of these bills by paying the respective fees charged into his Bank Account in the United Kingdom. He asserted that upon failure to meet the outstanding sums of 262,683.19 pounds sterling and U.S. $31,932.25 he commenced an action against the plaintiffs in the Federal High Court. Lagos in suit number FHC/L/16/88 for the recovery of this amount with interest.

By a motion ex parte in the said suit, the defendant sought and obtained an order for the arrest of the vessel, M.V. REALENGRACHT, which, he claimed, belonged to the 2nd plaintiff. He stated that following the arrest of the vessel, the plaintiffs struck an accord with him whereupon he released the said vessel. The plaintiffs, pursuant to the said accord, paid his claims and subsequently instituted the present action against him seeking the return of the monies paid to him.

On the 26th April, 1991, the defendant filed a motion on notice in the action pursuant to the provisions of Order 52, rules 2 and 7 of the High Court of Lagos (Civil Procedure) Rules, 1972 praying the trial court to order the plaintiffs to give security for the defendant’s costs and to stay all further proceedings in the suit until such security was given by the plaintiffs. This was supported by a 16 paragraph affidavit sworn to by the defendant himself. The plaintiffs also filed a 10 paragraph counter-affidavit in opposition to this application.

At the conclusion of hearing, the learned trial Judge, Ope-Agbe, J. in a considered ruling granted the application on the 27th day of March, 1992 and ordered as follows:-

“I accordingly make an order that the plaintiffs do within 30 days from today 27/3/92 give security for the defendant’s costs in the sum of $84,279.76 (Eighty-Four Thousand, Two Hundred and Seventy-Nine Dollars, Seventy-Six Cents) plus N10,000.00 (Ten Thousand Naira).

It is further ordered that further proceedings by or on behalf of the plaintiffs be stayed until the security is given.”

Being dissatisfied with the said ruling, the plaintiffs lodged an appeal against the same to the Court of Appeal, Lagos Division, which in an unanimous decision on the 1st day of June, 1992 allowed the appeal, set aside the order for security for costs made by the learned trial Judge and dismissed the defendant’s application.