First Bank Of Nigeria Plc & Anor V. First City Monument Bank Plc & Anor (2013)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

AMINA ADAMU AUGIE,J.C.A. (Delivering the leading Judgment)

This appeal turns on a garnishee proceeding initiated against 2nd Respondent at the Federal High Court. However, the initial Suit that led to the proceedings is Suit No. LD/1477/2005 at the Lagos State High Court between First Atlantic Bank Plc. v. Sormatt Ventures Ltd. & Mrs. Olowokere Olusade Adebowale for a loan facility granted to the 1st Defendant and guaranteed by 2nd Defendant. The Lagos State High Court entered Judgment in favour of First Atlantic Bank for the sum of N10,078,287.78.

The 1st Respondent later initiated a Garnishee Proceeding against the Appellants and 4 other banks. The High Court granted a Garnishee Order Nisi on 25/9/2006 against them. The other banks filed their respective affidavits to show cause and were discharged from the garnishee proceedings on 29/10/2007. On that same day, an order absolute was entered against the Appellants and they were ordered to pay the said Judgment debt.

On 9/11/2007, the 1st Respondent commenced a garnishee proceeding against the 2nd Respondent [CBN] via a Motion Ex-parte praying the Court for –

7. AN ORDER that all the debts due and accruing from the Garnishee to the 1st and 2nd Judgment Debtors or so much thereof as may be sufficient to satisfy the Judgment Debt herein, be attached to answer the Garnishee Order recovered against the 1st and 2nd Judgment Debtors by the Garnishor/Applicant.
8. AN ORDER directing the Garnishee to prepare and file before this Hon.Court a Statement of Accounts showing the 1st and 2nd Judgment Debtor’s financial status with the Garnishee as from 6th June 2006.
9. AN ORDER directing the Garnishee to pay all sums in this suit being all debt due or accruing from the 1st and 2nd Judgment Debtors to the Garnishee/Applicant.

The lower Court entered an Order Nisi against CBN on 3/12/2007, and upon being served with the Order, it filed an Affidavit to show cause. However, the lower Court made the Garnishee Order Nisi Absolute against CBN on 6/2/2008.

On 11/2/2008, the Appellants filed two separate Applications seeking for Orders setting aside the Order Nisi and Absolute on the following Grounds –

“TAKE FURTHER NOTICE that the ground for this application is the non-service of the Garnishee Order nisi in Suit No. LD/1477/2005 at the Lagos State High Court on the 2nd Judgment debtor in this case who was the 5th Garnishee in [the said] Suit . AND TAKE FURTHER NOTICE that the Garnishee order absolute in Suit No. LD/1477/2005 at the Lagos State High Court was also not served on the 5th Garnishee (Ecobank), who is the 2nd Judgment Debtor in this case.”

The Applications were supported by similar 19 paragraph Affidavits deposed to by Lawan Fagge, a Legal Officer with the 1st Appellant, and Chika Idigo, a Legal officer with the 2nd Appellant. They averred in their respective Affidavits that –

8. The Garnishee Order Nisi of the Lagos State High Court was never served on [it] to show cause why the Order Absolute should not be made.
9. On 29/10/2007, the Lagos State High Court presided by Hon. Justice A. A. Phillips made the Garnishee Order Nisi, ABSOLUTE against [it].
10. Garnishee Order Absolute of the Lagos State High Court granted on 29/10/2007 was also not served on [it].
11. The Judgment Creditor, First Atlantic Bank Plc. rather instituted another Garnishee Proceeding against CBN the bankers of the present Judgment Debtor for a loan facility that [it] never guaranteed.
12. The present Judgment Debtor became aware of this suit for the first time upon the receipt of a letter from CBN on 4/2/2008 informing [it] of the Garnishee Order Nisi on the CBN. (Letter attached as Exhibit)

It was averred in paragraph 13 that the 1st Appellant “promptly sent memo to its Internal audit Department to confirm the existence of any account(s) in the names of the -Original Judgment Debtors”, and in its paragraph 14 that –

“- – Revealed that the 2 Defendants/Original Judgment Debtors in Suit No. LD/1477/2005 SORMATT VENTURES LTD. and (Mrs. Olowokere Olusode Adebowale) have no accounts with the 1st Judgment Debtor in this Suit as 4th Garnishee in Suit No. LD/1477/2005 at the Lagos State High Court”. (Internal Memo attached as Exhibit)

The 2nd Appellant averred in paragraph 13 that it “sent mails to all its branches database nationwide to confirm the existence of any account(s) in the names of the Original Judgment Debtors in [the said] Suit”, and in paragraph 14 that –

“The response to the mails – – revealed that the 1st Defendant/Judgment Debtor in Suit No. LD/1477/2005 SORMATT VENTURES LTD. has no account with [Ecobank] while the 2nd Defendant/Judgment Debtor (Mrs. Olowokere Olusade Adebowale) has an account No. 0140110107429701 and that the balance has been nil since the year 1998 well before the commencement of Suit. No. LD/1477/2005 at the Lagos State High Court in the year 2005. (Mails from its Head office attached as Exhibits)

Both Deponents further averred in paragraphs 16-17 of their Affidavits that –

16. The institution of Suit No. FHC/L/CS/1045/2007 [at the Federal High Court] against the Judgment debtor without service of the processes of the first Garnishee proceedings at the Lagos State High Court is an abuse of Court processes.
17. It is in the interest of justice for Garnishee Nisi and Garnishee Order Absolute be set aside as the Court locks jurisdiction for lock of service.

The 1st Respondent filed a Counter-Affidavit, wherein the Deponent, one Zainab Kelani, counsel in the Law Firm of Joseph Nwobike, Esq., averred that –