Vinchem International Ltd V. Eleme Petrochemicals Company Ltd. (2010)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

HON JUSTICE M. DATTIJO MUHAMMED, OFR J.C.A. (Delivering the Leading Judgment)

At the Port Harcourt judicial Division of the Federal High Court hereinafter called the lower court, the Appellant in the instant appeal as plaintiff commenced suit No. PHC/PH/CS/1459/04 on 7th September, 2004 against the Respondent then being the defendant. The former’s claim against the latter is for the sum of Thirty Two Million, Six Hundred and Seventy-Two Thousand, Eight Hundred and Sixty-Two Naira, Forty Two Kobo (N32, 672, 862.42) for the breach of the contract in respect of goods procured for and delivered to the Respondent by the Appellant which sum the Respondent failed and/or refused to pay.

Having entered appearance, but without filing its statement of defence in answer to Appellant’s statement of claim, the Respondent by a motion on notice filed on 26th August, 2005 prayed the court below for:

“1. An order setting aside the writ of summons for non-service on the Defendant.

2. An order striking out the suit for being statute barred.
3. An order striking out the suit for lack of jurisdiction or, the basis of non-service of a pre-action notice on the Defendant/ Applicant.
4. And any further order or orders the Honourable court may deem fit to make in the circumstance.”

In paragraphs 8, 9, 1 0, 11 and 12 of the affidavit in support of the defendant’s objection to the lower court’s jurisdiction, it was averred as follows:

“8. That upon perusal of the processes, we saw that one Madu P.U. was served with the writ of Summons in the suit.

9. That the said Madu P.U. is neither the chairman nor The Managing Director of the NNPC or the Defendant/Applicant.
10. That the Plaintiff/Respondent did not serve the Defendant/Appellant with requisite statutory pre-action notice before instituting this action.
11. That the alleged transactions given rise to this suit were transacted between February, 1999 and August, 2000 when the Defendant/Applicant vide a letter dated 21/8/00 requested the Plaintiff/Applicant to discontinue its planned supplies of rigid couplings to it. The said letter is hereby annexed and marked EXHIBIT EPCL 1.
12. That the Plaintiff/Respondent filed this action on 7/9/04, that is, over three years after EXHIBI EPCL 1.”

Paragraphs 5 and 6 of the further affidavit in support of Respondent’s motion are hereunder also reproduced for their relevance:-

“5 That attached as Exhibit EPCL 2 is the said Certified True Copy of the Memorandum and Articles of Association of the Applicant.

6. That all the shares of the Applicant are owned by the NNPC hence it is wholly owned subsidiary.”

The Appellant as Respondent to the motion decision in respect of which gave rise to the instant appeal did not file any counter-affidavit to challenge or contradict the averment in support of the motion

Following the court’s order, parties filed and exchanged written addresses on Defendant/Respondent’s motion on notice and same were adopted and relied upon at the hearing as arguments for and against the application.

In a well considered ruling delivered on 17th May, 2006, the court found the defendant a wholly owned subsidiary of the Nigerian National Petroleum corporation which, by virtue of section 12, 13 and 22 of the NNPC Act, must be served with pre-action notice and that Plaintiffs failure to serve same had rendered the suit incompetent. Having decided that Appellant’s action is incompetent for all the reasons advanced by the Respondent the court struck out the action. Dissatisfied, the Plaintiff has by is Notice containing three against the decision. Parties have filed and exchanged their briefs of argument as arising for the determination of the appeal read:-

“2.1 Whether the learned trial judge was right when she held that the Respondent need not file a statement of defence before moving the court to strike out the suit for non compliance with sections 12 and 13 of the NNPC Act ((Ground 3).

2.2. Whether the learned trial judge was right when she held that the defendant proved that it was wholly owned subsidiary of NNPC at the time suit was instituted on 7th September, 2004 (Grounds 1 & 2)”

The Respondent’s two similar issues read:-