Agro Allied Development Ent. Ltd V. Mv Northern Reefer & Ors (2009)
LAWGLOBAL HUB Lead Judgment Report
S. N. ONNOGHEN, J.S.C
This is an appeal against the ruling of the lower court delivered on the 7th day of May, 2001 in appeal NO.CA/L/102/2000 in which the court granted the application of the present respondents who were the appellants/applicants before that court, in the following terms:-
“(1) leave is hereby granted to the applicants to amend their notice of appeal dated 29th July, 1999;
(2) Time to apply for leave to appeal on grounds of mixed law and fact is extended till today;
(3) Leave is hereby granted to appeal on grounds of mixed law and fact;
(4) The amended notice of appeal shall be filed within 14 days from today;
(5) The appeal shall be heard on the bundle of documents marked “record Of appeal” filed in this court’s registry on 7th March, 2000 and such other documents the respondent may be advised to file within 21 days from today;
(6) the said record of appeal filed on 7th March, 2000 are hereby deemed to be properly filed”,
The appellant, who was the respondent at the lower court is dissatisfied with the above ruling and has consequently appealed to this court.
The facts of the case include the following:-
The plaintiff, who is the present appellant and respondent in the lower court instituted an action against the present respondents at the trial court claiming the sum of $2,500,000.00 as special and general damages arising from the breach of contract of carriage of goods and for negligence relating to a cargo of frozen fish evidenced by seven bills of lading issued by or on behalf of the present respondents, then defendants. Though the claim is stated to be against the defendants/respondents jointly and severally, as against the 1st defendant/respondent i.e. MV Northern Reefer, it is in rem and in personam as against the 2nd and 3rd defendants/respondents.
Following the service of the processes on the defendants, the defendants/respondents filed an application in the trial court praying for the following reliefs:-
(a) An order dismissing or in the alternative striking out this action or alternatively.
(b) An order discharging the order of arrest of the 1st defendant.
The application was dismissed by the trial court resulting in an appeal to the lower court by the present respondents.
In the course of the proceedings in the lower court in respect of the said appeal the present respondents, who are the appellants before that court, brought an application praying the court for the following orders:-
i. An order granting leave to the appellants to amend their notice of appeal dated 29th July, 1999.
ii. An order for extension of time to apply for leave to appeal on grounds of mixed law and fact.
iii. An order for leave to appeal on grounds of mixed law and fact.
iv. An order for extension of time within which to appeal.
v. An order directing a departure from the rules of this honourable court to enable the appellants compile the records of appeal may be heard.
vi. An order deeming as properly filed and served the said records of appeal, filed on 7th March, 2000.
vii. An order of accelerated hearing of the appeal herein and abridging of time within which parties may file their briefs of argument in this appeal”.
The present appellant opposed the application on the ground that the application is incompetent as the applicant is said to be under liquidation necessitating the obtaining of the leave of the court under the provisions of section 417 of the Companies and Allied Matters Act (C.A.M.A). The ruling of the lower court, the terms of which had earlier been reproduced in this judgment is the reaction of the lower court to the application of the respondents.
By the appellant’s brief of argument filed on the 12th day of November, 2002, the learned senior counsel for the appellant Jimi Oduba Esq, SAN, identified four issues for the determination of the appeal. There are as follows:-
i. Does liquidation of a company rob it of a right to bring an appeal/application without leave with regard to section 417 of the companies and allied matters act
ii. Should the Court of Appeal have granted the prayers of the respondent herein before it without considering whether the 3rd applicant before it had sought leave to continue the appeal/application
iii. Did the Court of Appeal in its ruling give effect to the principle of law enunciated in COOPERATIVES AND COMMERCE BANK (NIG) LTD VS ALEX O. ONWUCHEKWA (Pt.647) (2000) 3 NWLR 65.
iv. Was the Court of Appeal right in stating that only the vessel was a necessary party to the appeal”.
On the other hand, Oluseye Opasanya, Esq, counsel for the respondents, submitted a single issue for determination in the respondents’ brief filed on the 27th day of March, 2003. The issue is as follows:-
“Whether the third defendant requires leave of court to appeal pursuant to section 417 companies and allied matters act Cap 59, LFN 1990, as a condition for its appeal to the Court of Appeal”.
I hold the considered view that having regards to the facts of this case relevant to the appeal and the decision of the lower court on appeal to this court, the single issue formulated by learned counsel for the respondents is the real issue in controversy between the parties. Every other issue or sub issue begs the question; it is clear that it is a realization of the above that made the learned senior counsel for the appellant, in arguing the issues, to treat or argue his purported four issues together.
In arguing the issue under consideration, learned senior counsel for the appellant stated that the fact that the 3rd defendant, Northern Reefer A/S, the owner of the vessel MV Northern Reefer, the 1st defendant went into bankruptcy in the course of the proceedings is not in dispute but submitted that as a result of the said bankruptcy of the 3rd defendant, no action or proceedings “shall be proceeded with or commenced against the company except by leave of court given on such terms as the court may impose” relying on the Court of Appeal decision in the case of The C.C.B (Nig) Ltd vs Onwuchekwa (Pt.647) (2000) 3 NWLR 65 at 74 being that courts interpretation of the provisions of section 417 of the companies and allied matters act cap 59, laws of the Federation of Nigeria, 1990 (CAMA); that the leave so required is a pre-condition to the continuance of any action by the company that has been wound up; that since the respondents did not obtain the leave of the court before presenting the application to amend the notice of appeal, the resulting proceeding thereon is a nullity, relying on the case of NDIC vs. FMB (Pt.490) (1997) 2 NWLR 735 at 757-758 and Abeke vs NDIC (Pt.406) (1995) 7 NWLR 228. I must observe that the way learned senior counsel for the appellant cites cases is rather strange and unorthodox. The normal way we cite cases is to cite the name of the case (parties), the year it was reported, the particular volume of the report and the part of the report (book) where the case is reported, and the page on which it is reported. For instance:
Abeke vs NDIC (1995) 7 NWLR (Pt.406) 228 not Abeke vs NDIC (Pt.406) (1995) 7 NWLR 228. The learned senior counsel then proceeded to discuss the principles that the court would consider in deciding whether to grant leave or not under section 417 of CAMA and concluded that the failure of the 3rd defendant/appellant before the Court of Appeal to obtain leave rendered the continuation of the appeal before that court incompetent and urged the court to resolve the issue in favour of the appellant and allow the appeal.
On his part, learned counsel for the respondents submitted that the provisions of the companies and allied matters act, CAMA, are not applicable to this case because:
(a) the 3rd defendant/respondent being a foreign company its affairs are not regulated by the provisions of CAMA, relying on sections 264(1), and 650 of CAMA;
(b) that the provisions of section 417 of CAMA do not require a company in liquidation to obtain leave of court before it can proceed with an action but that it requires leave in order for an action to be proceeded with or commenced against the 3rd defendant/respondent; that since the 3rd defendant was one of those that were the appellants in the lower court the situation contemplated by section 417 of CAMA does not arise.
Learned counsel then cited and relied on the decision of this court in Onwuchekwa vs. NDIC(2002) 5 NWLR (Pt 760) 371 at 393 and submitted that there is nothing in the said section 417 preventing the company in question from proceeding with action or proceeding against another person. Learned counsel finally urged the court to hold that the lower court was right in its ruling and resolve the issue against the appellant and dismiss the appeal.
Section 417 of CAMA, the interpretation of which is the bone of contention between the parties provides as follows:-
“if a winding up order is made or a provisional liquidator is appointed, no action or proceeding shall be proceeded with or commenced against the company except by leave of the court given on such terms as the court may impose.”
It is settled law that the duty of the courts is simply to interpret the law or constitution as made by the legislature or the framers of the constitution.It must therefore, be borne in mind always that the courts cannot amend the constitution or statute neither can they change the words used in drafting same.
From the reproduced section 417 of CAMA supra, it is my considered view that the provision is very clear and unambiguous. It is now settled that:-
“In the area of construction, the primary concern of the courts is the ascertainment of the intention of the legislature or law makers. From this function, the court may not reside however ambiguous or difficult of application the words of the law or act may be, the court is bound to place some meaning upon them. If the language is clear and explicit, the court must give effect to it, for in that case, the words of the statute speak the intention of the legislature. Its function is jus dicere not jus dare. The words of a statute must not be overruled by the judges” per OBASEKI, JSC, in Ojokolobo vs. Alamu (1987) 3 NWLR (Pt.61) 317 at 402.
Bearing the above words of wisdom in mind particularly as the words used in section 417 of CAMA are very clear and unambiguous, I hold the view that they ought to be given their plain and simple meaning as the said words speak for themselves particularly as they clearly demonstrate the intention of the framers of the statute which is clearly not to place any disability on the company mentioned under section 417 of CAMA from instituting or continuing any civil action against any person or persons during their bankruptcy or liquidation. The prohibition contained in section 417 of CAMA is rather against the plaintiff/appellant and for the benefit of the defendant mentioned therein.
It is very clear from the above provision that the party to seek and obtain the leave of the court before proceeding with or commencing an action against a company for which a provisional liquidator has been appointed or a winding up order made, is the party who intends to proceed with or commence the action, not the other way round. In the instant case, it is the appellant who is the plaintiff at the trial court that ought to seek and obtain leave of the court before proceeding further with the action at the trial court following the initiation of the process of liquidation of the 3rd defendant. The appellant is, however, not looking at the competence of his action against the 3rd defendant in the circumstances of this case but the competence of the appeal/application by the 3rd defendant.
However, the law on the point has been settled by this court in the case of Onwuchekwa vs. NDIC (2002) 5 NWLR (Pt.760) 371 at 393 per AYOOLA, JSC where he stated thus:
“There is nothing in section 417 which prohibits such company as is described in the section from proceeding with action or proceedings against another person. What that section prohibited subject to leave of the court is proceeding with action or proceeding against the company”.
In other words, the company as in this case, the 3rd defendant, does not need leave of court to proceed with action or proceeding against another company or person in this case, the appellant by way of the appeal. The provision is very much like the constitutional immunity granted the president/vice president, governor and deputy governor against suits and prosecution during their tenure of office which does not prevent or incapacitate the president/vice president or governor and deputy governor from instituting action against anybody for any wrong or claim of right during their said tenure of office:- see section 308 of the 1999 constitution and Tinubu vs. IMB Securities Plc (2001) 16 NWLR (Pt.740) 670 at 721- 722 where AYOOLA,JSC, expressed the following view:-
“Thirdly, I am unable to construe a provision of the constitution that granted an immunity such as section 308(1) as also constituting a disability on the person granted immunity when there is not provision to that effect, either expressly or by necessary implication in the enactment. If makers of the constitution had wanted to prohibit a person holding the offices stated in section 308 from instituting or continuing action instituted against any other person during his period of office, nothing would have been easier to provide expressly that:-
“no civil or criminal proceeding shall be instituted against any person by a person to whom this section applies during his period of office and no civil or criminal proceedings shall be instituted or continued against such a person during his period in office or in like terms. The makers of the constitution in their wisdom did not so provide”.
It should also be noted that section 417 of CAMA talks of leave of the court. The question is which court The learned counsel for the respondents has submitted that the relevant court is the Federal High Court, not the Court of Appeal or any other appellant has filed no reply brief in relation to the respondents’ position, thus denying this court the benefit of his reaction to the submission. It is however, very clear from the decision of this court in the case of FMBN vs. NDIC (1999) 2 NWLR (Pt.591) 333 at 365 and the provisions of section 650 of CAMA which defines the word “Court” as used in section 417 of CAMA that the “Court” whose leave is required before proceeding with or commencing any action against a company in liquidation or under a winding up order is the Federal High Court, not any other court like say the Court of Appeal or Supreme Court. In the instant case the application and the appeal on which it was made was before the Court of Appeal, not the Federal High Court. It is therefore clear again that the provision of section 417 of CAMA is inapplicable to the facts of this case.
Thirdly, it is the contention of learned counsel for the respondents that the 3rd defendant/respondent being a foreign company is not bound or affected by the provisions of section 417 of CAMA. As stated earlier in this judgment, the appellant filed no reply brief to counter the submission of counsel for the respondents on the issue. That notwithstanding, the issue is very much relevant and is worthy of consideration. There is no doubt, and which parties are agreed, that the 3rd defendant/respondent is a foreign company; it is not a Nigerian company. The question is whether being a foreign company its affairs are regulated by the provisions of CAMA.
Section 624(1) of CAMA provides as follows:-
(i) Except as otherwise provided, this Part A of this Act shall apply to:
(a) all companies formed and registered under this Act;
(b) all existing companies;
(c) all companies incorporated, formed or registered under other enactments; and
(d) unregistered companies”.
The question that follows is:-
“What is Part A of CAMA”. The answer is simply the provisions of the Act CAMA falling within sections 1-651 which clearly includes section 417 supra. It is very clear therefore that the 3rd defendant/respondent not being a Nigerian company or company falling within the definition of section 264 (1) of CAMA, its affairs are not regulated by the provisions of CAMA. The definition of “Company” in section 650 of CAMA puts the matter beyond doubt. It defines “Company” or “Existing companies”. To mean…..a company formed and registered under this Act or, as the case may be formed and registered in Nigeria before and in existence on the commencement of this Act”.
It is my considered view that the 3rd defendant being a foreign company, as it is not a Nigerian company as defined in section 650 of CAMA, the provisions of section 417 of CAMA do not regulate its affairs and that by the provisions of section 60 (b) of CAMA, the 3rd defendant/respondent can sue and be sued in its own name and can maintain such an action or proceeding.
In whatever angle one looks at the issue under consideration, it is clear that the issue fails and is consequently resolved against the appellant. In conclusion, I hold the considered view that the appeal is without merit and is consequently dismissed with N50, 000.00 (fifty thousand naira) costs in favour of the respondents. Appeal dismissed.
SC.268/2002