First Bank Of Nig. Plc & Anor V. Ndarake & Sons (Nig) Ltd. & Anor (2008)

LawGlobal-Hub Lead Judgment Report

KUMAI BAYANG AKAAHS, J.C.A.

This is a ruling delivered against the Defendants/Appellants by the High Court of Akwa Ibom State, holden at Ndiya Ikot Imo, Ikono Judicial Division presided over by Abraham J. on 6/6/2006 in Suit No. HKN/26/2005. The facts leading to this appeal are as follows:

The First Bank Plc. granted credit/loan facilities to Ndarake & Sons (Nig) limited which were secured by three separate deeds of legal mortgage covering three separate properties and registered in the Lands Registry, Calabar. After drawing down on the loan facility, Ndarake & Sons (Nig) Limited defaulted on the payment of the loan together with interest. The Bank wrote several demand letters to the company but the latter replied pleading for time to settle its indebtedness to the Bank. When it became apparent that the company was unwilling to repay the loan and the accumulated interest, the Bank instructed its auctioneer to auction the mortgaged properties. Following an advertisement in the Pioneer Newspaper of Monday, 9th May, 2005 one of the mortgaged properties situated at Itu Udo (Itudoh) Ibioho Ibom was auctioned to one Mr. Mandu Hassey Odom. After the said sale the Plaintiffs/Respondents commenced Suit No. HT/41/2005 on 11/7/2005 at the High Court, Ikot Ekpene. It was later transferred to Ikono Judicial Division and given Suit No. HKN/26/2005. The respondents also filed a motion for interlocutory injunction against the sale of the three mortgaged properties pending the determination of the suit. The motion was opposed by the appellants who filed a counter-affidavit. After hearing arguments on the motion, the court delivered its ruling on 6/6/2006 restraining the appellants from selling any of the mortgaged properties pending the determination of the suit. It is against this ruling that the appellants appealed.

There were four grounds contained in the Notice of Appeal from which three issues were formulated as follows:

i) Whether the learned trial Judge did not err in law when he ordered an interlocutory injunction against a concluded sale of a property.

ii) Having regard to the fact that the plaintiff/respondent admitted the facts contained in the Counter-Affidavit and Further Counter-Affidavit filed by the appellants whether the trial Judge was not wrong in granting the order of injunction restraining the appellants, an unpaid mortgagee, from exercising its power of sale under the deeds of mortgage.

iii) Whether the trial Judge was not wrong in refusing to accept as admitted the unchallenged affidavit evidence of the appellants to the effect that the plaintiffs/respondents were indebted to the 1st appellant under the mortgage deeds.

An application dated 14th August, 2007 which was filed on 29/8/2007 for extension of time to file the Appellants’ brief and to deem same as duly filed was heard and granted on 27/9/2007. Since the Respondents failed to file the Respondents’ brief a further application to hear the appeal on the appellants’ brief alone was granted on 7th September, 2008. Thereafter, the appeal was adjourned to 22/9/2008 and 21/10/2008 for hearing. The appeal was heard on 21/10/2008 without the respondents filing any brief.

The appeal arose from the interlocutory decision of the lower court which granted an order restraining the appellants from selling the mortgaged properties until the final determination of the substantive action. That suit is yet to be determined by the High Court. In view of the fact that the substantive action is yet to be dealt with only the first issue has arisen for determination.

Learned counsel submitted that an injunction cannot lie to restrain a concluded act and cited the case METRO GAS LIMITED v. EFERAKEYA (2001) FWLR (Pt. 39) 1442 at 1454 in support of the submission. He referred to the prayers in the motion for interlocutory injunction and the counter-affidavit by the appellants filed on 9/2/2006 especially paragraphs 15 & 16 of the said counter-affidavit which were not controverted and argued that the appellants duly established the fact that the property at Itu Udoh, Ibiono Ibom was sold before the suit was commenced. That being the case, learned counsel maintained, the trial court restrained a completed act which is not allowed by law. He referred to the following cases to buttress his argument: AJEWOLE v. ADETIMO (1996) 2 NWLR (Pt. 431) 391; OCHOMA v. IDEOZU (2001) FWLR (Pt. 51) 1875; JOHN HOLT NIG. LTD. v HOLT AFRICAN WORKERS UNION (1963) 1 ALL NLR 319. He urged this court to allow the appeal since the plaintiffs did not deny knowledge of the sale.

In the motion filed on 11/7/2005 the applicants now respondents prayed for the following reliefs:

1. An order of interlocutory injunction restraining the 1st respondent, its agents, servants and privies from auctioning, selling or attempting to sell the properties of the applicants pending the hearing and determination of the substantive suit.

2. An order granting the applicants, its agents, servants and privies continuous free and unimpeded access to their following properties:

i) One residential building of (4) four flats and 2 (two) storey buildings of 6 (six) flats, both at No. 20 Nto Etuk Idem Street, Off Church Road, Ikot Ekpene Urban, Akwa Ibom State.