John Akujobi Nwabueze V. Obioma Nwosu (1988) LLJR-SC

John Akujobi Nwabueze V. Obioma Nwosu (1988)

LawGlobal-Hub Lead Judgment Report

B. CRAIG, J.S.C. 

On the 28th of June, 1988, the court allowed this appeal, and adjourned till today to give reasons for doing so. I now give my reasons for agreeing that the appeal be allowed.

The whole appeal is concerned with the order for a stay of execution granted to the Respondent by the High Court, Aba which order was confirmed by the Court of Appeal, Enugu.

It is not in dispute that the trial Court had a discretion to grant a stay, but the main point in this appeal is whether that court had exercised its discretion judiciously having regard to all the circumstances of the case.

In this respect, I should like to refer to the principles laid down by this court in several decided cases to the effect that it will not interfere in the exercise of the discretion of a lower court unless the exercise of such discretion is “manifestly wrong, arbitrary, reckless or injudicious” –

See per Nnamani, J.S.C. in University of Lagos v. Olaniyan (1985) 1 NWLR 156 at p.163.

In another case on the same point, Bello, J.S.C. (as he then was) stated the principle in these words:-

“Thus an appeal court may interfere with the exercise of judicial discretion if it is shown that there has been a wrongful exercise of the discretion such as where the tribunal had acted under a misconception of law, or under misapprehension of fact in that it either gave weight to irrelevant or unproved matters or it omitted to take into account matters that are relevant or where it exercised or failed to exercise the discretion on wrong or inadequate materials and in all other cases where it is in the interest of justice to interfere.”

See the case of University of Lagos v. M. I. Aigoro (1985) 1 NWLR 143 at 148. Other cases on the same principle are Demuren v. Asuni (1967) All N.L.R. 94 at 101 Solanke v. Ajibola (1968) 1 All NLR 46 at 52 Sonekan v. Smith (1967) All NLR 329 and Niger Construction Ltd. v. Okugbeni (1987) 4 NWLR 787.

In the instant case, it will be necessary to give a brief background of the circumstances leading to the making of the order.

In the Aba Judicial Division of Imo State, the appellant had sued the Respondent for a refund of the sum of N48, 125.56 being “a friendly loan given to the defendant at his request between 8th June, 1982 and 1st September, 1982.” The Respondent, in his statement of defence, admitted receiving the said amount from the appellant, but stated that it was “not a friendly loan, but the Appellant’s share of a haulage business.” On that sole issue, the trial Court (per Mbachu, J.) found as follows:

“There was no partnership agreement between the parties nor were they in partnership for the business. The plaintiff has not derived any benefit whatsoever from the transaction into which he put his money; if any person had a benefit from the arrangement it is the defendant. Justice demands that the plaintiff gets back his money and so I give him judgment in terms of his claim for N45,125.56 with N300 costs inclusive of out of pocket expenses.

That judgment was given on the 7th of August, 1986 and on the following day, the Defendant/Respondent appealed against the judgment. On that same day, he filed a motion for a stay of execution, and in the accompanying

Affidavit, he stated inter alia, that:

(a) He was dissatisfied with the court’s judgment and had lodged an appeal against it.

(b) He had paid the costs of N300.00 awarded against him.

He then averred further as follows:

“8. That I have no means of paying the judgment debt and prosecuting the appeal at the same time.

9. That my haulage business has almost grounded to a halt because of lack of patronage owing to the depression in the economy.
10. That since the business started in 1982 with two trucks together with the accessories there has not been any increase in the fleet of vehicles.
11. That if the respondent is allowed to execute the judgment debt the two trucks are- likely to he levied with execution thus depriving me of the opportunity of earning money to satisfy the judgment debt should the appeal fail.”

In reply to the above, the appellant filed a counter-affidavit in which he stated positively that “the applicant has more than enough means of paying the judgment debt.” He then gave a list of the applicant’s assets, which in his estimation were enough to cover the judgment debt. Some of these assets were:

(i) Two tipping trailers.

(ii) A “lucrative haulage business” which includes a haulage contract with Supahaul (Nigeria) Ltd.

(iii) One tipping bucket at Megwa’s Filling Station Aba, which could fetch N10,000.00

(iv) A landed property at Ogbor Hill, Aba, valued at more than N30,000.00.

(v) Two pleasure cars and a big electric generator at Nkpa (the Respondent’s village) in Bende Local Government of Imo State.)

(vi) Several expensive electronic equipments (Colour television, video set, stereo set etc.)

Apart from all these, the Appellant averred that the judgment debtor spends his annual leave in Europe and that:

“14. The applicant’s asset as herein set out are more than enough to satisfy the judgment and to leave enough for him to carry on his business and to live in his usual affluence.”

Although the Respondent made a general denial of these pointed assertions, he went on to admit the units of assets which he was supposed to own. For instance, he admitted owning the two tipping trailers, but said that they had broken down and that he “only managed to rehabilitate one of them a week ago, by means of a Bank overdraft” (he did not say how much the overdraft was or what amount he had spent on the repairs). He also admitted that he had a haulage contract with Supahaul (Nig.) Ltd., but stated that the main contract had been suspended by the Federal Government. The Respondent again admitted that he owned a piece of land near Ovom Village, but he stated that it was an empty piece of land and was worth far less than N30,000.00 (he did not give any valuation).

Finally, the Respondent admitted that he had two pleasure cars, but said that they were old: he also admitted that he had travelled to Europe in 1979, 1980, 1981, 1982 and 1983 for what he termed:

“very personal reasons which were neither related to business nor pleasure; since 1984 I have not travelled to Europe or abroad because I can ill afford it.”

When the Motion came before the trial Court, the learned Judge received addresses from counsel, and in particular his attention was directed to the principles involved in the application and to the relevant authorities on the point; the case of Vaswani Trading Co. v. Savalakh & Co. (1972) 12 SC.77 was specifically referred to by Counsel.

A few days later, Mbachu, J. handed down a ruling on the Motion. It was contained in only 22 lines – less than half a foolscap sheet of paper. It reads as follows:

“RULING”

“Defendant/Applicant is seeking a stay of execution of the judgment in this suit delivered on 7th August, 1986 pending the determination of an appeal against the judgment. Applicant filed an affidavit, a further affidavit and a second further affidavit in support of the motion. The Respondent filed a counter-affidavit. I have considered the submissions of learned Counsel for and against the motion together with the decided cases cited. From these submissions and available affidavit evidence, I am satisfied that even if the Applicant loses the appeal the Respondent would be able to recover the amount of judgment by levying execution on the declared assets of the Applicant. On the other hand, if the Applicant wins the Respondent gets nothing. I would therefore allow the Applicant to exercise his right of appeal and hereby grant his prayer for stay of execution pending the determination of the appeal. Because the Respondent is entitled to reap the fruit of the judgment which stands until it is set aside, he is by this order of stay of execution deprived of the benefit of the judgment entered in his favour. It is my further order therefore that Applicant pays N100.00 costs to the Respondent.”

At this stage, I should like to observe that the Ruling did not appear to have given enough or any consideration either to the facts of the application or to the law applicable to those facts. The learned Judge said that if the Defendant loses the appeal, the plaintiff “would be able to recover the amount of judgment by levying execution on the declared assets.” The question is how was the learned Judge sure that when the appeal was heard at some future date, (may be in several months or even years to come) the defendant would still possess those same assets or enough assets to satisfy the judgment debt. If the judge was sure that the debtor possessed enough assets to satisfy the judgment, why did he not make a further order to protect the vested rights of the judgment creditor. He could for instance, have asked the debtor to provide a Bank guarantee in favour of the creditor. However that may be, the learned Judge granted a stay without any conditions. Needless to say that the Plaintiff/ Appellant was dissatisfied with the Ruling and he appealed against it to the Court of Appeal.

One of the grounds of appeal in that court was that the trial Judge “erred in Law in granting the application for a stay of execution when no special circumstances were shown by the Defendant/Judgment Debtor.”

This time, the lower Court took time to consider in very great detail both the facts of the case and the law applicable to those facts.

It accepted counsel’s argument that the guiding principle is that a court does not make it a practice of depriving a successful litigant of the fruits of his success, unless under very special circumstances. See Vaswani Trading Co. v. Savalakh & Co. (1972) 12 Sc. 77 at 81-82.

But the lower Court went on to say that the Respondent’s application had disclosed such special circumstances as is envisaged in Vaswani’s case supra. This is how the lower Court put it:

“A party who has a constitutional right of appeal should not be deprived of the means of prosecuting his appeal by the harassment of a writ of execution. After all, the filing of Notice and grounds of appeal alone does not end the prosecution of an appeal. So many other steps still need be taken to ensure that an appeal is prosecuted timeously after the filing of the Notice and grounds of appeal and if the appellant were forced to pay a judgment debt which will make the prosecution of his appeal impracticable or frustrate the prosecution of the appeal, such situation amounts, in my opinion, to an exceptional circumstance “because it will amount to a bar to the right enjoined in the 1979 Constitution for the benefit of the appellant……………………….

When therefore the Respondent in this appeal deposed that he has no means of paying a large judgment debt of N45,125.56 against which he has appealed and be able to prosecute the appeal at the same time; the learned Judge was justified in preserving the constitutional right of the Respondent to exercise his right of appeal and thereby granted the stay of execution”. (Italics mine)

The Appellant was dissatisfied with that judgment and he has appealed to this court on six grounds of appeal. In his brief of argument, he formulated five issues for determination, but I consider two of them sufficient in determining this appeal these are:

“1. Whether the Court of Appeal, Enugu was right in affirming the decision of Hon. Justice C.U. Mbachu in the court of first instance staying the execution of the judgment merely on the ground that the Plaintiff/Judgment Creditor/Respondent (Appellant herein) would be able to recover the judgment debt if the Defendant/Judgment Debtor/Applicant (Respondent herein) lost his appeal and not on any ground of exceptional circumstance shown by the Defendant/Judgment Debtor/Applicant.

2. Whether the Court of Appeal, Enugu, was right in holding that the Respondent established special circumstance entitling him to a grant of stay of execution merely because the Respondent asserted that he had no means of paying the judgment debt and prosecuting the appeal at the same time.”

As stated earlier on in this judgment, the main issue to be decided is whether the court of trial exercised its discretion judiciously in granting a stay of execution. In other words, were there enough materials before that court upon which it could properly exercise its discretion.

The principles laid down in Vaswani’s case supra are quite clear: it is this that a court will not, as a matter of course, deprive a successful litigant of the fruits of his success unless there are “very special circumstances” for doing so. At page 82 of the Report (Vaswani’s case) the Supreme Court went on to define what it meant by special circumstances:

It stated:

“When it is stated that the circumstances or conditions for granting a stay should be special or strong we take it as involving a consideration of some collateral circumstances and perhaps in some cases inherent matters which may, unless the order for a stay is granted, destroy the subject-matter of the proceedings or foist upon the court, especially the Court of Appeal, a situation of complete helplessness or render nugatory any order or orders of the Court of Appeal or paralyse, in one way or the other, the exercise by the litigant of his constitutional right of appeal or generally provide a situation in which whatever happens to the case, and in particular even if the appellant succeeds in the Court of Appeal, there could “be no return to the status quo.”

That definition does not pretend to cover all cases; but the principle enunciated therein has stood the test of time. It provides a sensible guide to similar applications and has been followed in several cases which have come before the Courts.

In my view, Vaswani’s case, establishes the principle that the court will provide adequate protection to the judgment which it had given to a successful litigant and such litigant will not be deprived of that judgment unless, there are strong compelling reasons for doing so. In short, the court will not give with one hand and take away with the other hand. But in the overall interest of justice, it will stay temporarily the hand of the judgment creditor only if the debtor shows very exceptional circumstances for doing so.

In the instant case, what one should ask is whether the Respondent had shown exceptional circumstances why the court should hold up the hands of the judgment creditor. In his affidavit, he stated that after judgment was given against him, he filed an appeal against the judgment and paid the costs awarded against him. He then stated in paragraphs 8 and 9 of the affidavit:

“8. That I have no means of paying the judgment debt and prosecuting the appeal at the same time.

9. That my haulage business has almost grounded to a halt because of lack of patronage owing to the depression in the economy.”

Now, I ask, are these compelling reasons why a stay of the court’s judgment should be granted I do not think so. The Respondent states that he has no means of paying the judgment debt and prosecuting the appeal, but the Appellant has enumerated in his counter-affidavit sufficient assets which would satisfy the debt due. Again the Respondent states that his haulage business had almost come to a halt, but in answer to the Respondent’s counter-affidavit, he admitted that he had obtained a loan from a Bank to resuscitate the business.

In my view, the facts disclosed in the Respondent’s affidavit are not of such exceptional nature as would be sufficient to deprive the Appellant of the fruits of the judgment which he had obtained on the merit. The reasons for the stay are not such as would either:

(a) destroy the subject-matter of the suit or

(b) leave the court of appeal in a state of complete helplessness or

(c) make it difficult to return to the status quo if the respondent succeeds in his appeal.

In a recent case, L. Okafor & Ors. v. F. Nnaife (1987) 4 NWLR 129, the Supreme Court held that a discretion to grant or refuse a stay must take into account the competing rights of the parties. The court also held that:

“A discretion that is biased 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 judicially exercised.” ibid at p.136

In the instant case, I am satisfied that there were no special grounds upon which the court of first instance could have granted a stay of execution, and the exercise of the court’s discretion in favour of the Respondent was wrong and injudicious. For the same reasons, the confirmation of that order by the Court of Appeal was equally wrong.

It was for all the above reasons that I allowed the appeal on the 28th of June, 1988 and set aside the orders of the two lower Courts. It is ordered that the Respondent’s Motion for a stay of execution shall be dismissed.

SC.11/1988