Franchal (Nig.) Ltd. & Anor V. N.A.B. Ltd. (2000)

LAWGLOBAL HUB Lead Judgment Report

UWAIS, C.J.N.

This is an interlocutory appeal against the decision of the Court of Appeal refusing an application by the appellants for stay of execution pending appeal. The background facts to the case are as follow. The appellants were indebted to the respondent. On 29 October, 1993 the respondent took out a writ of summons in the erstwhile High Court of Anambra state holden at Onitsha. The case was placed on the undefended list. The respondent’s claim against the appellants was for:

“(a) N39,053,312.89 (Thirty-nine Million, fifty-three thousand, Three Hundred and Twelve Naira, Eighty-nine Kobo) being the balance of the principal sum of overdraft granted to the first defendant (1st appellant) and personally guaranteed by the second defendant (2nd appellant).

(b) N32,575,004.67 (Thirty-two Million, Five hundred and seventy five thousand, four naira, sixty-seven Kobo) being interest, commissions and other bank charges which accrued to the principal sum of N129,780,976.52.

(c) 40% compound interest on the principal sum and already accrued interest from 1st October, 1993 until the date of judgment.

(d) 5% simple interest on the judgment debt from the date of judgment until it is finally liquidated.” The 1st appellant was served with the writ of summons on 29th October, 1993 while the 2nd appellant was served on the 2nd November, 1993 by substituted service. The case came up for hearing before Nwofor J. on the 11th November, 1993 and all the parties to the case were represented by counsel. In the case of the appellants, they were jointly represented and their counsel file a memorandum of appearance earlier on the day in question. After considering and resolving some preliminary objections on procedure raised by learned counsel for the defendants, the learned trial judge ruled as follows:

“It is my view that all the issues raised by the defendants as their defence to the sum of N39m claimed are not defence on merit and are merely being raised to dribble this action. The case of Nal Merchant Bank Ltd. v. Macaulay (1986) 5 NWLR(Pt.40) 216 C.A., (1986) 7 C.A. (Pt. 111) 59-60 provides as follows: See also Chief B.C. Agueze v. Pan African Bank Ltd. (1992) 4 NWLR (Pt.233) 76. These cannot but apply the principles established in these cases on this case and refuse the application in respect of the defence to the amount of N39,000,000.00 claimed and strike out the application by the defence in respect of that claim.

In respect of the N32,575,004.67 being the amount of interest and commissions etc. I shall let in the defendants to defend this claim. The same goes for the claim of 40% compound interest because it is the rate of interest that determines the amount of interest. This decision is based on defendants defence that their agreement was 11% simple interest and not compound interest. I shall therefore enter judgment for the plaintiff for N39,053,312.89 against the defendant jointly and severally. The condition in which the defendant will be let in to defend the amount of interest and the rate of interest as per paragraphs B and C of the plaintiff’s claim is that they pay the plaintiff the sum of N29,000,000 immediately and the balance of N10,053,312.89 to be paid when the amount of interest is ascertained. This condition is made pursuant to Order 24 Rule 9 (3) of the High Court Rules of Anambra State, 1988.”

Thereafter the defendants brought a motion on notice seeking an order of the High Court for a stay of execution pending the appeal which they filed to the Court of Appeal. The motion which was heard on 10th February, 1994 was refused by the learned trial Judge on 21st February, 1994.

Next, the defendants filed another motion on notice in the Court of Appeal asking for a stay of execution pending the determination of the appeal before it. The motion was heard on the 26th May, 1994 and ruling reserved. The ruling was delivered on the 22nd June, 1994. In dismissing the application, the Court of Appeal (Achike, J.C.A., (as he then was, Akintan and Adamu JJ.C.A,) held, as per Akintan J.C.A. thus:-

“The main question to be resolved in the instant case therefore is whether from the facts disclosed in the various affidavits in support of the application, the grounds of appeal filed against the verdict (sic) of the court as well as all the circumstances of the case, the applicants have made a case warranting the exercise of this court’s discretion in their favour. It is trite law that a discretion to grant or refuse a stay of execution must take into account the competing rights of the parties to justice. A discretion that is based in favour of an applicant for a stay but does not adequately take into account the respondent’s equal right to justice, is a discretion that has not been (sic) judicially exercised. (See Mobil Oil Ltd. v. Agadaigho, (1988) 2 NWLR (Pt.77) 383 and Okafor v. Nnaife, (supra) (1987,4 NWLR (pt.64) 129.

The respondent in the instant case is a licenced (sic) commercial bank. The 1st applicant is a company incorporated in Nigeria and maintains a bank account with the Onitsha branch of the respondent bank. The 2nd applicant is the Chairman/Managing Director of the 1st applicant company. He is the man behind the company. The claim before the (High) Court was founded on credit facilities granted by the bank to the 1st applicant which the 2nd applicant guaranteed. One of the undisputed facts place before the trial court is that the total amount of money granted to the 1st applicant and guaranteed by the 2nd applicant was over N130 million. The 2nd applicant admitted this fact in an affidavit he swore to and placed before the trial court. He also admitted that out of that amount, over 80% of the sum has been paid. He then averred that only N29 million was still outstanding. In other words, the 2nd applicant admitted that N29m was still owed to the Bank. That was the amount which the court ordered the applicants to pay to the respondent.

The question therefore is whether it is equitable for this court to grant a stay of execution of the portion of that judgment ordering the applicants to pay N29m which the applicants admitted owing the respondent while proceeding with the rest of the claim disputed. My answer to that question is definitely in the negative. The grounds of appeal filed against the judgment of the court have nothing to do with the issue of the amount which the 2nd applicant admitted as the balance due on the transaction …

A ground of appeal alleging that the court awarding not what was claimed cannot therefore be said to raise any substantial issue for determination by this court.