J. Export & Chemical Company Limited V. Kaduna Refining & Petro-chemical Company Limited (2002)

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MAHMUD MOHAMMED, J.C.A. This appeal is against the judgment of the High Court of Justice of Kaduna State delivered by Dogara Mallam J. at Kaduna on 14/5/96. The dispute between the parties arose out of an agreement entered between the parties in this appeal on 11/5/93 by which the appellant hired 4 ISO-Tanks from the respondent for shipment of petroleum products on a rental charge of N10,000.00 for each tank for a period of 8 weeks. The appellant took delivery of the tanks and used the same to ship petroleum products to Europe. At the expiry of the 8 weeks period of lease of the tanks, the appellant failed to return them to the respondent as agreed.

When the respondent requested the appellant to return the tanks, the appellant attributed its failure to return the tanks to the uncertainty in the political situation in Nigeria then brought about by the disputes over the June 12 election. The appellant however promised to deliver the tanks to the respondent on or before 10th August 1993 undertaking to pay any surcharge that may be due. On further demand for the return of the tanks by the respondent, the appellant this time attributed its failure to return the tanks to the alleged industrial action at the Lagos Port. After repeated demands, the appellant finally returned the tanks to the respondent in September 1993 in clean condition along with the payment in the sum of N80,000.00 rental charges for the tanks.

However, nearly 3 months after returning the tanks to the respondent and paying for the lease charges, the appellant raised problems encountered with the tanks in Europe by its agent who claimed the sum of $85,016 from the respondent being alleged expenses incurred by the foreign partner or agent on account of unsuitability of the tanks, lack of fitness certificate for them, rental of alternative tanks in Europe and fines paid for the tanks for breach of relevant regulations. When the appellant’s claim was resisted by the respondent, the appellant then proposed the appointment of an arbitrator to resolved the dispute between the parties and this was accepted by the respondent. When the parties appeared before the arbitrator jointly appointed by them, instead of the earlier sum of $85016.00 claimed by the appellant’s foreign agent, the respondent found a claim of $400,000.00 filed by the appellant awaiting adjudication by the arbitrator jointly appointed by the parties. Thus, the respondent instead of responding to the claim of the appellant before the arbitrator, headed to the Kaduna State High Court of Justice Kaduna and filed an action against the appellant by an originating summons dated 20/12/94 and claimed the following reliefs –

“1. A declaration that the defendant’s claim against the plaintiff upon which reference has been made to Martin M. Olisa (Arbitrator) is prima facie fraudulent and therefore not a proper subject of arbitration as contemplated by the parties in their agreement dated May 11, 1992.

2. Leave to revoke the arbitration agreement and the arbitrator’s authority upon the ground set out above.”

Although the appellant by a motion on notice had applied to the trial court for stay of proceedings in this action pending the determination of the arbitration proceedings between the parties, the application was refused by the trial court which proceeded to hear and determine the respondent’s action. In its judgment delivered on 14/5/96, the learned trial Judge granted the reliefs sought by the respondent in its Originating Summons in the following terms:-

“Judgment is hereby entered for the plaintiff as follows: –

The defendant’s claim against the plaintiff upon which reference has been made to Martin O. Olisa (Arbitrator) is prima facie fraudulent and therefore not a proper subject of arbitration as contemplated by the parties in their agreement dated 11th May, 1993. Leave is hereby granted the plaintiff to revoke the arbitration agreement and the arbitrator’s authority.”

Aggrieved by this judgment, the defendant in the trial court which is now the appellant in this Court had appealed against it upon 4 grounds of appeal contained in its Notice and grounds of appeal dated 30/7/96. In the appellant’s brief of argument deemed filed on 12/12/2000 in compliance with the rules of this Court, 2 Issues were formulated from the 4 grounds of appeal for the determination of the appeal. The Issues are:-

“(a) Whether the learned trial Judge was right in entertaining the respondent’s Originating Summons seeking to revoke the authority of the arbitrator on ground of fraud.

(b) If the answer to (sic) (1) is in the affirmative, whether the learned trial Judge was right in revoking the authority of the arbitrator on the ground that the claim of the appellant was prima facie fraudulent.”

The plaintiff now respondent also filed a respondent’s brief of argument within the time extended by this Court on 22/4/2002 also raising 2 Issues from only 3 of the 4 grounds of appeal filed by the appellant as learned senior counsel for the respondent had clearly stated at page 5 of the respondent’s brief that only 3 grounds of appeal were filed by the appellant. However, as far as the appellant’s Notice and Grounds of Appeal dated 30/7/96, contained at pages 75-76 of the record of this appeal is concerned, there are 4 distinct grounds of appeal filed by the appellant. As the issues identified in the respondent’s brief of argument were not related to the grounds of appeal, it is not quite clear which of the grounds of appeal the learned senior counsel to the respondent had decided to ignore in preparing the respondent’s brief of argument which raised the following issues for the determination of the appeal.

“1. Do the courts have the jurisdiction or power under Nigerian Law to intervene where claims before an arbitrator are prima facie fraudulent so that such claims are determined by a court of law?

2. If the answer to the above question is positive, was the learned trial Judge right in declaring the present claims prima facie fraudulent and consequently revoking the authority of the arbitrator to determine them?”

Having regard to the 4 grounds of appeal filed by the appellant in this appeal, it is quite clear that the 1st issue framed in the respondent’s brief of argument does not arise from any of the grounds of appeal filed by the appellant.

A brief of argument ought to be confined to matters which properly arise has consistently avoided going into purely academic question.”