First Bank Of Nigeria Plc. Vs Kayode Abraham (2008)

LAWGLOBAL HUB Lead Judgment Report

O. ADEREMI, J.S.C.

This is an appeal against the judgment of the Court of Appeal (Lagos Division) delivered on the 13th of June, 2002, in appeal No. CA/L/275/95: First Bank of Nigeria Plc. Versus Kayode Abraham. The appellant who was also the appellant in the court below and the plaintiff in the trial court had taken out a Writ of Summons in the trial court claiming against the respondent before this court and who was then the defendant in the trial court, as follows:

The plaintiff’s claim against the defendant is for recovery of the sums of $644,382.16 DR. i.e. (N6,416,821.99) and $499,786.15 DR. (N4,976,920.46) in Loan Accounts Nos. 5814903420 and 5814904160 respectively and 64,816.59 pounds i.e. (N1,109,672.98) in Loan Account No.7114902420 as at 31st October,1991, totaling in all N12,503,415.43 DR. being the total indebtedness owed to the plaintiff by the defendant as a result of credit facilities by way of loans granted to the defendant by the plaintiff sometimes in 1988 which indebtedness the defendant has failed and/or refused to settle despite repeated demands.

The plaintiff claims interest on the said sum of N12,503,415.43 DR at the rate of 21% per annum from 31st October, 1991, until the final payment of the debt.

The final pleadings filed and exchanged between the parties are Statement of Claim by the plaintiff/appellant and by the leave of court, an Amended Statement of Defence by the defendant/respondent. The plaintiff/appellant had, upon the entering of appearance by the defendant, filed an application for summary judgment under Order 10 Rules 1 and 2 of the High Court of Lagos State (Civil Procedure) Rules,1972. The defendant/respondent filed a Preliminary Objection together with a counter-affidavit against the plaintiff’s application for summary judgment. In his Preliminary Objection, the defendant/respondent raised the issue of jurisdiction contending that the High Court of Lagos State lacked jurisdiction to entertain the suit adding that the suit ought to be taken in England where the loan was obtained by the defendant/respondent at the London Branch of the appellant bank.The learned trial Judge who heard the Preliminary Objection upheld it and thus declined jurisdiction in the matter.

In so declining jurisdiction, the trial Judge had reasoned thus:

Even though the defendant is now within the jurisdiction of this court, it is clear that he negotiated the loans and obtained them (sic) in the United Kingdom where his account with the London Branch of the bank is designated Resident Account. I believe that the loans will be governed by the United Kingdom Laws particularly as they were loans calculated in the United Kingdom currency and United States dollars.

I am in no doubt that action for the recovery of the loans ought to be properly commenced in the United Kingdom where the loans were obtained. Any judgment obtained in that country can then be registered in this jurisdiction for the purpose of enforcement.

Consequent upon the Ruling of the trial court, the plaintiff/appellant filed an appeal against that Ruling to the court below. In dismissing the appeal to it, the court below held inter alia:

It is a well established principle of International Law that a Nation State can only validly make laws covering its own territory. The Rules of Court made under an enabling law of Lagos State of Nigeria cannot have effect over transactions conducted in England and governed by English Law. Indeed, the Rules of a State High Court do not govern transactions conducted in another State within Nigeria. It is therefore a fundamental flaw in the argument of appellant’s counsel to accept that a banking transaction conducted in London is subject to the Lagos State High Court rules as to the court in which a suit could be brought.

To allow the appellant to enforce in Nigeria a loan transaction in London is to enable the appellant to circumvent the provisions of Exchange Control Act, Cap. 113, Laws of the Federation of Nigeria,1990.

The lower court not only declined jurisdiction but offered to the appellant advice as to the proper method to approach its claim.

I entirely agree with the reasoning of the court below. This appeal lacks merit.

Dissatisfied with the judgment of the court below, the appellant has appealed to this court per a notice of appeal dated 12th September, 2002, which has incorporated into it five (5) grounds. Distilled therefrom, for determination by this court, are four issues which, as set out in the appellant’s Brief of Argument filed on the 6th of February, 2004, are in the following terms: