Brawal Shipping (Nigeria) Limited. V. F. I. Onwadike Co. Limited & Anor (2000)

LAWGLOBAL HUB Lead Judgment Report

UWAIFO, J.S.C.

The appellant is the 1st defendant against whom, along with the 2nd defendant, a claim of N2,160,820.00 is made in this suit which was instituted in the Federal High Court, Port Harcourt. The statement of claim shows that in 1991, the plaintiff (now 1st respondent) purchased some quantities of Icelandic fish heads from its customers in Iceland.

Upon two bills of lading made in Iceland [No. C.116 of 24 April, 1991 and No. C 416 of 29 May, 1991], the 1st defendant undertook the shipment of the said fish heads, clear on board on behalf of the plaintiff to the port of delivery in Port Harcourt. The fish heads were covered by the Insurance Policy of the 2nd defendant against all risks, losses or damages. The fish heads were examined before shipment and a Certificate of Clearance in accordance with import requirements of the Federal Government of Nigeria was issued.

When eventually the two ships carrying the fish heads landed at the port in Port Harcourt on 8 June, 1991 and 2 July, 1991 respectively, the fish heads were placed under Bad Order List at the port. The reason was that some of them were found to be wet, some rotten and some missing through pilferage as some of the containers landed without their seals. The losses and damages occurred while the goods were in the 1st defendant’s custody. All these facts are as pleaded in the statement of claim filed on 15th October, 1992.

The 2nd defendant has since November 1, 1992 filed a statement of defence in response to the statement of claim. The 1st defendant has not filed one. Instead, on 14th January, 1993, the 1st defendant made an application for an order to dismiss or strike out the suit as against it. The grounds for this are that “the plaintiffs not having been named as either the consignee or endorsee of the relevant Bills of Lading on which their claim herein is based, and/or if so named, having endorsed the same to another party, has no locus standi to institute and/or maintain this action as presently constituted”, and therefore by taking this course, the 1st defendant came by way of demurrer. It went further to attach copies of the two bills of lading pleaded by the plaintiff to the motion on notice as exhibits FA1 and FA2.

At the hearing of the application, learned counsel for the 1st defendant relied on the bills of exchange and made copious analysis of them to argue that the plaintiff not being the last indorsee of the said bills, could not sue on them. I consider it helpful to recite the relevant portion of the submission by him as recorded by the learned trial Judge (Ojutalayo, J.) verbatim as follows:

“Learned counsel here took pains to analyse the two bills of lading in great details to show that the shippers or consignors are ‘Norfish Ltd.’ of Iceland; that the goods were consigned to the Order of ‘Order’ that is, not consigned to anybody in particular. He also showed the ‘endorsement in blank’ by the shippers at the back of the bills which also shows that the endorsement was to nobody in particular. He further directed the attention of the court to the endorsement on top of the Bills of lading – ‘Not to be released unless endorsed by First Bank of Nigeria’ and the endorsement of the Bills of Lading by First Bank to the plaintiff who is also the ‘Notify Party’ in the two Bills … But, plaintiff endorsed the Bills ‘in blank’, that is, also to nobody in particular. But under the endorsement, there is another endorsement by Ngo West Africa Ltd. By this endorsement Ngo West Africa Ltd. became the holder and the last endorsee. It was therefore counsel’s contention that by endorsing the Bills of Lading to Ngo West Africa Ltd., plaintiff has divested themselves of any right of action based on the bills of lading.”

Learned counsel for the plaintiff submitted, among other things, that under the procedure adopted by the 1st defendant, he was deemed to have admitted the relevant paragraphs 4 and 8 of the statement of claim showing the plaintiff to be the purchaser and consignee of the goods in the bills of lading and also that it was the last indorsee of the said bills; that except in the case of ‘indorsement in blank’, the words ‘deliver to’ are necessary in all other kinds of indorsement to effect transfer of property in the goods; that the plaintiff having paid all the amount required to be paid on the bills to the First Bank whereupon the said bank indorsed the bills to it, acquired the right to sue on them; and that the mere stamping of the bills by Ngo West Africa Ltd. did not make it an indorsee.

On 15th April, 1993, the learned trial Judge in a considered ruling held that he was entitled to look at the bills of lading in a demurrer proceeding since they were pleaded in the statement of claim; that the said bills showed that Ngo West Africa Ltd, was the last indorsee and that by such indorsement, the plaintiff ceased to have the locus standi to sue on the bills of lading. He concluded that in the circumstances, the proper order was that of dismissal and accordingly, he dismissed the suit. The appeal against that ruling was allowed by the Court of Appeal in a judgment given on 28th June, 1995 with an order that the 1st defendant answer the statement of claim. Against that judgment which is now reported as F. I. Onwadike & Co. Ltd v. Brawal Shipping (Nig.) Ltd. (1996) 1 NWLR (Pt.422) 65, this appeal was made to this court.

The 1st defendant (hereinafter referred to as the appellant) in the present appeal filed seven grounds of appeal from which it raised the following issues for determination:

“I. Was it open to the lower court to abandon all the 1st respondent’s issues (who were the appellants before them) as formulated and adopt the appellant’s issue or formulate its own issue for determination in the appeal when such an issue did not arise from any of the grounds of appeal filed before them and then to determine the appeal on that singular issue while abandoning all the other issues before it (Ground 7).

2. Alternatively, was the 1st respondent in these proceedings still entitled to sue on the bills of lading contract under the provisions of section 375(1) of Merchant Shipping Act, cap.224 when it was clear on the evidence before the court that they had re-endorsed the bills to 3rd parties thereby divesting them of title to the goods and the right to sue (Grounds 1 & 3).
3. Was it open to the lower court to refuse the appellant’s demurrer application and order trial when the said appellant had a clear legal and/or equitable defence to the 1st respondent’s claim (Ground 2).
4. Even after resolving the only issue it adopted in the 1st respondent’s favour, was it not duty bound to pronounce on all the other issues properly raised before it (Ground 4).
5. Was it open to the lower court to refuse to follow the various decisions of this Honourable court in the cases of: Adesanya v. Leigh Hoegh (1968) 1 ANLR 333; Lawal v. GBO (1972) (pt.1) ANLR 207, and BGCC v. CMIS (1962) ANLR 565 by reason of which there has been a miscarriage of justice resulting in an overturning of the decision of the court of first instance given in appellant’s favour. (Ground 5)
6. Was it open to the lower court to refuse to follow its earlier decision in the Seatrade’s case and to adopt their latter conflicting decision and thereby either expressly or by necessary implication, overrule itself (Ground 6).”

The plaintiff/respondent (to whom I shall refer as respondent) did not file a brief of argument nor was it represented at the hearing of the appeal. The appeal was heard on the appellant’s brief of argument alone and the oral submissions of appellant’s counsel.

The substance of the argument in support of issue 1 is that the lower court determined the respondent’s appeal not on any of the five issues submitted to it by the respondent based on the five grounds of appeal filed but on only one of the six issues formulated by the present appellant. As there was no cross-appeal filed, those six issues must, to be valid, relate to the grounds of appeal before the lower court as decided in several cases including Nzekwu v. Nzekwu (1989) 2 NWLR (Pt.104) 373; Onifade v. Olayiwola (1990) 7 NWLR (Pt.161) 130; Momodu v. Momoh (1991) 1 NWLR (pt.169) 608. It has been submitted that the only issue on which the judgment was based was not encompassed by any ground of appeal before that court. In other words, it was formulated in error by the present appellant as respondents as admitted and argued by appellant’s counsel before us. It is therefore contended that the lower court should have discountenanced the issue and if that had been done, the decision of the trial court would not have been overturned. This court is now urged to set aside the lower court’s judgment on the basis that it was reached upon an invalid issue.

The issue in question upon which the judgment of the lower court was reached was couched thus: