Stabilini Visinoni Limited V. Metalum Limited (2007)

LawGlobal-Hub Lead Judgment Report

MSHELIA, J.C.A.

The respondent filed suit No. LD/1430/2001 at Lagos State High Court and claimed against the appellant as per paragraph 13 of the statement of claim as follows:

“The sum of N686,414,89 being the sum owing to the plaintiff on the defendant’s admission in respect of several sub-contracts executed by the plaintiff on behalf of and for the benefit of the defendant with interest thereupon at the rate aforesaid. Cost of prosecuting this action assessed at N50,000.00 only.”

Briefly, the facts are that between 1993-1997, the plaintiff executed sub-contracts for the benefit of the defendant. Defendant by then was indebted to plaintiff in the sum of N1,486,414.89 (One Million Four hundred and Eight-Six Thousand, Four Hundred and Fourteen Naira, Eighty Nine Kobo). Defendant admitted owing the amount but prepared a schedule that same would be settled instalmentally. Defendant defaulted since 1997and remained indebted to plaintiff to the tune ofN686,414.89 (Six Hundred and Eighty-Six Thousand, Four Hundred and Fourteen Naira Eighty-Nine Kobo). Despite repeated demands defendant failed to pay the money hence this action.

Upon an application for judgment by the plaintiff, the defendant admitted the sum claimed, but challenged the plaintiff entitlement to interest on the sum owed. Defendant paid plaintiff the principal indebtedness in the sum of N686,414.89K at the plenary stage by cheque delivered to plaintiff’s counsel in court on 22/11/2001. The contest on interest was then set down for trial. Plaintiff called one witness but, defendant did not call witness. Both counsel addressed the court. The learned trial Judge Alogba J, in a considered judgment, at page 33 of the record had this to say:

“Accordingly, I hereby enter judgment in favour of the plaintiff against the defendant in the sum equivalent to 10% of the principal sum in issue (N686,414.89K) from 6th November, 1997 to 22nd November, 2001 and up to 30th October, 2002 and thereafter interest at the rate of 71/2% per annum thereon until fully liquidated. I award N5,000.00 cost to this suit to plaintiff.”

Aggrieved with the decision of the trial court, defendant now appellant appealed to this court by filing its notice and grounds of appeal on 4/11/02. The notice of appeal contained two grounds of appeal.

In compliance with Order 6 of the Court of Appeal Rules, patties exchanged briefs of argument. Appellant filed its brief on 31/05/06.

Appellants reply brief was also filed on 9/08/06.

Respondents brief of argument was filed on 31/05/06.

From the two grounds of appeal filed appellant distilled two issues for determination. The issues are:

(1) Whether the lower court was justified in awarding interest to the respondent when same was not proved.

Whether having regard to the pleadings and evidence before the lower court the lower court was justified in awarding the respondent 10% per annum interest from 6th November 1997 to 30th October, 2002 and thereafter at the rate of 71/2% per annum until judgment is fully liquidated.

Respondent on the other hand, formulated two issues for determination. The issues are:-.