Agro Millers Limited V. Continental Merchant Bank (Nigeria) Plc (1997)

LawGlobal-Hub Lead Judgment Report

MOHAMMED, J.C.A. 

This is an appeal against the judgment of Dagara Mallam J. of the Kaduna State High Court of Justice delivered on 30/11/92. The respondent as plaintiff had filed an action under the undefended list at the lower court against the appellant which was the defendant, to recover a debt in the sum of N7,913,346.64k. The respondent’s writ of summons was filed together with an affidavit and a further affidavit in support of the claim. On being served with the writ of summons and the supporting affidavits, and in compliance with the rules of the lower court, the appellant duly filed its notice of intention to defend the suit with an affidavit and a further affidavit in support of the notice. On the date fixed for the hearing of the undefended suit, the learned trial Judge heard arguments from learned counsel on both sides on whether the appellant as defendant ought to be granted leave to defend the suit on its affidavits in support of its notice of intention to defend the suit, or judgment should be entered for the respondent as plaintiff. In a considered ruling/judgment delivered by the learned trial Judge on 30/11/92, he refused to grant the appellant/defendant leave to defend the action and entered judgment for the respondent/plaintiff in the sum of N7,913,346.64k with interest at the rate of 27% per annum from 18/11/91. In that ruling/judgment, the learned trial Judge also held that the affidavits in support of the defendant’s notice of intention to defend did not disclose any defence on the merits as required by ORDER 22 RULE 3 of the Kaduna State High Court (Civil Procedure) Rules 1987. Dissatisfied with the ruling/judgment, the defendant now appellant has appealed against it to this Court. The Notice of Appeal dated 7/12/92 contains 7 grounds of appeal.

The parties, in accordance with the rules of this court duly filed their respective briefs of argument. In the appellant’s brief, the following 2 issues for determination were formulated.

“1. Whether or not the learned trial Judge was right in holding that the appellant’s notice of intention to defend did not disclose a defence on the merit and in entering judgment for the respondent

2. Whether or not the learned trial Judge over amplified the requirement of Order 22 Rule 3, High Court of Kaduna State Civil Procedure Rules as relates to onus of proof under the undefended list.”

In the respondent’s brief of argument however, only the following one issue was identified for the determination of the appeal –

“Was the Honourable learned trial Judge right in holding that the appellant’s affidavit in support of the Notice of Intention to defend the action discloses no defence on the merits as required by Order 22 Rule 5 of the Kaduna State High Court (Civil Procedure) Rules 1987.”

Looking at the second issue for determination raised in the appellant’s brief of argument, it is quite plain that the resolution of the issue one way or the other will not affect the result of this appeal because the issue has not been related to the decision of the lower court refusing to grant the appellant leave to defend the action, nor to the judgment of the lower court granting the respondent’s reliefs. In other words whether the learned trial Judge over amplified the requirement of ORDER 22 RULE 3 OF THE KADUNA STATE HIGH COURT (CIVIL PROCEDURE) RULES 1987 as relates to onus of proof, whatever that means, or he did not, as long as the answer is not sought to be linked with the decision of the lower court being challenged in this appeal, it is not a proper issue for determination in the appeal.

The remaining issue for determination in the appellant’s brief and the sole issue formulated in the respondent’s brief are virtually the same having been framed on the requirements of the application of ORDER 22 RULE 3 of the Kaduna State High Court (Civil Procedure) Rules 1987. Rule 3(1) of Order 22 of the Rules which is relevant reads:-

“3(1) If the party served with the writ of summons and affidavit as provided in Rules 1 and 2 hereof delivers to the Registrar not less than 5 days before the date fixed for hearing a notice in writing that he intends to defend the suit, together with an affidavit disclosing a defence on the merit, the court may give him leave to defend upon such terms as the court may think just.” (Italics mine)

It is quite clear from this rule that it is not the notice of intention to defend that must disclose a defence on the merit as stated in the issue as formulated in the appellant’s brief. It is the affidavit accompanying the notice of intention to defend that must disclose a defence on the merit before a defendant is granted leave to defend the action.

Therefore in so far as the issue formulated by the appellant has attributed the disclosure of defence on the merit to the notice of intention to defend rather than the appellant’s affidavit as stated by the rule, the issue is not properly framed. Similarly, the only issue as identified in the respondent’s brief is also defective in that the issue referred to RULE 5 instead of the relevant RULE 3 OF ORDER 22. Be that as it may, having regard to the circumstances of this case, I am of the view that there is only one issue for determination as identified in the respondent’s brief and also as formulated in the appellant’s Issue No.1 but slightly modified to reflect the legal requirements of RULE 3 of ORDER 22 of the Kaduna State High Court (Civil Procedure) Rules 1987. The issue properly framed should read thus:-

“Whether or not the learned trial Judge was right in holding that the appellant’s affidavits in support of its notice of intention to defend did not disclose a defence on the merit and in entering judgment for the respondent”

In support of the appellant’s arguments on this issue, its learned counsel Mr. Ashiekaa referred specifically to paragraphs 10, 11, 12, 13, 14, 15, 16 and 17 of the appellant’s affidavit in support of its notice of intention to defend and submitted that these paragraphs which were neither denied nor disputed were deemed admitted by the respondent and therefore no longer in controversy. The case of Nwosu v. Imo State Environmental Sanitation Authority (1990) 2 NWLR (Pt. 135) 688 at 721 among others was cited in support of the submission. Learned counsel pointed out that from the quoted paragraphs, it was clear that the appellant had raised triable issues such as the uncertainty of the amount being claimed in the action, the charging of more interest than agreed between the parties and duplication of debit entries for various amounts in the appellant’s account with the respondent among others justifying the learned trial Judge accepting the same as having disclosed a defence on the merit. Counsel stressed that at that stage of the hearing of the undefended suit, it was not necessary for the court to decide whether the defence has been established. That what was required simply was for the court to look at the facts averred in the affidavits of the defendant to see if they can prima facie afford a defence to the action. He cited the case of Nishizawa Ltd. v. Jethwani (1984) 12 SC 234. Learned counsel complained that the learned trial Judge had placed undue reliance on the case of Macaulay v. Nal Merchant Bank (1990) 6 SCNJ 117; (1990) 4 NWLR (Pt.144) 283 which is quite distinguishable with the present case as that case was decided under ORDER 10 RULES 1 and 2 of the Lagos State High Court Civil Procedure Rules which are not the same as ORDER 22 RULES 1 and 3 of the Kaduna State High Court Rules. Counsel therefore maintained that the appellant’s affidavit had disclosed a defence on the merit to warrant it being allowed to defend the action as the type of defence required to be disclosed in the affidavit is not a defence beyond reasonable doubt. It was also argued for the appellant that the lower court had placed a greater burden on the appellant than required by RULE 3 of ORDER 22 and that since it was obvious that there were conflicts in the evidence contained in the affidavits of the parties, particularly as to the rate of interest, the actual amount of the outstanding debt and the double debit entries, the only way the conflicts could have been resolved was by hearing oral evidence when the suit is transferred to the general cause list for hearing on the authority of Jipreze v. Okonkwo (1987) 3 NWLR (Pt.62) 737. Finally, the appellant concluded that by entering judgment for the respondent, the lower court had denied it a hearing and this had caused a miscarriage of justice.

It was however contended for the respondent that the appellant’s affidavits, particularly the paragraphs referred to in the appellant’s brief did not disclose any defence on the merits to justify granting the appellant leave to defend the action. Respondent’s counsel who described the paragraphs in the appellant’s affidavits as being mere blanket denial, pointed out that paragraphs 3, 4, 5, 6 & 7 of the appellant’s affidavit in support of its notice of intention to defend had in fact admitted the respondent’s claim. Learned counsel to the respondent further observed that all the averments in paragraphs 7 through to 17 of the appellant’s affidavit required supporting documents pointing out that paragraph 15 in particular in respect of which the Central Bank Circular fixing the interest rate of 21% at the material time ought to have been exhibited as the court cannot take judicial notice of a government circular which has not been produced before it as was decided in Katto v. Central Bank of Nigeria (1991) 9 NWLR (Pt. 214) 126. That for that reason, the lower court was right not to have given any weight to the appellant’s bare averments in its affidavit. A number of cases including Kimdey v. Governor of Gongola State (1988) 2 NWLR (Pt. 77) 445 at 473 – 474 was cited in support of this argument. Still on the bare averments of the appellant’s affidavit, the respondent further submitted that since the averments in the respondent’s affidavit in support of its claim on the undefended list were fully supported by documents while the averments in the appellant’s affidavit were bare and unsupported by any document, the learned trial Judge was right in entering judgment for the respondent on the authority of Udechukwu v. Ngene (1992) 8 NWLR (Pt. 261) 565 at 577.