Dresser Inc. V. Anatrade Limited (2003)

LawGlobal-Hub Lead Judgment Report

ABUBAKAR ABDUL-KADIR JEGA, J.C.A.

This is an appeal from the decision of the Lagos High Court contained in the Orders made by the Honourable Justice K.O. Alogba on the 26th day of June 2001 whereby an order of interim injunction was made against the Appellant sequel to the Ex-parte application filed by the Respondent on the 15th day of June, 2001.

The Appellant is a corporation established under the laws of the United States of America while the Respondent is a company incorporated in Nigeria.

By a Sales Representative Agreement dated the 15th day of January, 1996 made between the Appellant and the Respondent, the Appellant granted the Respondent the exclusive right to promote the sales of the Appellant’s products called DSVD products throughout Nigeria excluding Chevron Overseas Petroleum (C.O.P.I).

The Agreement which expired automatically on December, 31 1996 Pursuant to Clause 9 thereof, was reviewed by both parties and its validity extended from 1st January 1997 to 31st December, 1997 without any alteration or addition.

The parties did not execute a formal renewal of the Agreement after December 31, 1997 but agreed to continue their relationship on virtually the same basis and terms under the Agreement save for the modifications spelt out in the Appellant’s letter of February, 12th, 1998.

By virtue of Clause 14 of the Agreement, the parties agreed that if any controversy shall arise out of the agreement the matter shall be settled exclusively by Arbitration in accordance with the rules then prevailing of International Chambers of Commerce of Paris.

Clause 9 of the Agreement provides for termination of the Agreement by either party upon giving the other party not less than ninety (90) days written notice of termination.

The Appellant by its letter of March, 20 2001 and in accordance with Clause 9 of the Agreement gave the Respondent ninety days written notice of termination of the Agreement.

On the 15th day of June, 2001, five days to the effective date for the termination of the Agreement sequel to the Appellant’s letter of March 20, 2001, the respondent instituted an action against the Appellant at the Lagos State High Court. On the 20th day of June, 2001, five days after the suit was instituted; the respondent filed a motion Ex-parte whereby it prayed the Lagos State High Court with inter alia, for an order of interim injunction against the appellant. The motion Ex-parte filed by the respondent was heard and granted by the court on the 26th day of June, 2001.

The Appellant was dissatisfied with the Order of Interim Injunction granted by the High Court of Lagos State, therefore filed an appeal against the decision. We took the appeal on the 14th October, 2003 the appellant filed his brief of argument on 26th March, 2002 and reply brief on 7th October, 2002. Counsel to the appellant adopted and relied on both the brief of argument and the reply brief and urged us to allow the appeal. Counsel to the respondent filed the respondent’s brief of argument on 9th July, 2002, counsel to the respondent adopted his brief of argument and relied on it and urged us to dismiss the appeal.

Counsel to the Appellant in his brief of argument formulated two issues for determination. The issues are:
i) Whether the learned trial judge was right in granting the order of interim injunction in favour of the Respondent having regard to the principles laid down by the Supreme Court of Nigeria in the case of KOTOYE V. CBN & OTHERS 1989 ALL NLR 76.
ii) Whether the lower court can exercise jurisdiction on the suit instituted by the respondent when the Agreement executed by the appellant and the respondent stipulates that any controversy between them shall be settled exclusively by Arbitration.

The respondent initially formulated three issues for determination but at the hearing of the appeal abandoned its issue No. 2 thereby leaving two issues for determination which are stated thus:
i) Whether the Sales Representative Agreement dated the 15th day of January and renewed in 1997 was still the operative and effective Agreement governing the new contractual relationship between the parties having regard to the facts and circumstances of the case.
ii) Whether the learned trial judge was right in granting the order of interim injunction to the Respondent in view of the facts and circumstances of the case.

The appellant Notice of Appeal filed on the 2nd November, 2001 contained two grounds of appeal, the two grounds of appeal without their particulars are:
i) The learned trial judge erred in law in granting the order of interim injunction against the Defendant/Appellant in that the Plaintiff/Respondent’s exparte application for an order of interim injunction fell short of the conditions for the grant of an order of interim injunction as enunciated in the case of KOTOYE V. CENTRAL BANK OF NIGERIA & ORS (1989) ALL NLR 76.
ii) The learned trial Judge erred in law in granting the Order of interim Injunction against the Defendant/Appellant when the court lacks jurisdiction to hear and/or determine the subject matter of the suit.