Mobil Producing (Nig.) Unlimited V. Mr. Dennis Effiong Etukudo (2011)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

KUMAI BAYANG AKAAHS, J.C.A. (Delivering the Leading Judgment)

This is an appeal against the Interlocutory Ruling of Mbaba J. of the High Court of Akwa lbom state, Eket delivered on 15/2/2010 in suit No.HEK/6/2008. The parties filed and exchanged pleadings with the Defendant amending its Statement of Defence and the Plaintiff allowed to file consequential amendment to his Statement of Claim. Thereafter the Plaintiff testified and tendered 20 Exhibits. The matter was then adjourned for cross-examination. It was at this stage that the defence filed a motion on notice praying for “an order striking out the suit herein on the ground that the action is not properly constituted and the Honourable Court lacks jurisdiction to entertain the same in that the Plaintiff is not the proper party to initiate, commence or institute the suit and consequently has no cause; or right of action against the Defendant.”

In his Ruling dismissing the preliminary objection on 15/2/2010 the learned trial Judge found that it was on the basis of the letter of introduction dated 26/10/2010 (sic) that the Defendant signed the contract, the subject matter of the suit with the Plaintiff and went on to hold that the law recognises the person who signed the contract (Exhibit JO1) with the Defendant, and not the name of the company he used (the same not being a limited liability company) as the party to the deal (see page 109 lines 11 – 15 of the records).

On 12/7/2010 the Appellant obtained leave to appeal and filed its Notice on 13/7/2010 containing 4 grounds of appeal. The appellant distilled a lone issue from the grounds of appeal which is “Whether the learned trial Judge was right in holding that the Plaintiff, a Manager of Edge Enterprises (a business name owned by late George Edem Etudor) can in his own name sue to enforce the contract the subject matter of the action between the Appellant and Edge Enterprises.”

The Respondent also formulated the following sole issue for determination:

“Whether the learned trial court was right when it held that the law recognises the person who signed this contract (Exh. JO1) and not the name of the company he used, (the same not being a limited liability company) as the party to the deal.”

Both parties cited and relied on ATAGUBA & CO. v. GURA NIG. LTD. (2005) 21 NSCQR 720 at 739; (2005) 8 NWLR (Pt.927) 429 when canvassing their respective positions in the appeal. For the appellant it was submitted that only parties to a contract can sue or be sued in respect of the same and that lack of locus standi affects the jurisdiction of the court to adjudicate on the matter. Learned counsel for the Appellant further relied on the following cases for his submission:

UNIVERSITY OF JOS & ANOR. v. CARLEN NIG. LTD. (1992) 5 NWLR (Pt. 241) 352; PHILIP EBHOTA v. PLATEAU INVESTMENT & PROPERTY DEVELOPMENT CO. LTD. (2005) MJSC Vol. 11 page 36; (2005) 15 NWLR (Pt.948) 266; GHUBA IKPEMU v. ACB LTD, (1965) NMLR 374; ADESOKAN v. ADETUNJI (1994) 5 NWLR (Pt.346) 540 and OLORIEDE v. OYEBI (1984) 1 SCNLR 390. Learned counsel therefore asserted that the statement by the learned trial Judge that the law recognizes the person who signed the contract with the Defendant and not the name of the company he used as the party to the deal cannot be the true position of the law since the persons who signed a contract are not necessarily the parties to the contract but the actual persons whose names appear as parties to the said contract. He buttressed this point by contending that if this line of argument is followed to its logical conclusion, the suit ought to be between the two managers of the parties namely Mr. Dennis Effiong for Edge Enterprises and Mr. J. B. Effiong for Mobil Producing Nig. Unlimited.

Learned counsel for the Respondent submitted that unlike an incorporated entity, the proprietor of a firm is not an agent of the firm but enters into a contract to bind himself and such contract can be enforced against the proprietor. If the proprietor authorizes another person to act for him, that person has all the powers and capacity to enter into a contract in the name of the firm and to enforce it personally. It is therefore the contention of learned counsel that while it is true that it was Edem George Etudor who gave Dennis Effiong Etukudo power and authority to use the firm’s name Edge Enterprises Nigeria for the purpose of executing contracts with the defendant pursuant to Exh. ‘JO4’, the said Dennis Effiong Etukudo entered into the contract in his own name and signed Exh. ‘JO1’ by himself, he can sue and be sued on the transaction. Relying on OGUEJIOFOR v OSAKA (2000) 3 SC 1, learned counsel submitted that parties are bound by the contents of any written agreement duly executed by them and while a corporate entity has legal personality and can sue and be sued in its corporate name, an unincorporated association must of necessity act through its appointed representative. Learned counsel then referred to Section 573 (2) CAMA which permits another person other than the owner of the business name to carry on the business in that person’s name provided he complies with Section 577 (1) CAMA and submitted that since Edge Enterprises Nig. was still carrying on business, it is erroneous to contend that the business ceased to exist and so should be struck off from the register. Finally he relied on OSHEVIRE v. TRIPOLI MOTORS (1997) 4-6 SCNJ 246 to submit that there was a tripartite agreement between the respondent, Edge Enterprises Nigeria and Mobil Producing Nig. Unlimited which gave the respondent the locus to sue on the agreement.

If the initial pleadings in this suit had not been amended, this appeal would be unnecessary because the Plaintiff had pleaded (which facts were admitted) that he was a registered contractor with the defendant and was trading under the name and style of Edge Enterprises (Nig) and that sometimes on 1st June, 2004 he was awarded a contract for, the replacement of the entire back wall of Generator building at Utue PP at the cost of N2,423,281.50. This position however was altered when the Defendant denied paragraphs 1 and 3 of the Statement of Claim in its paragraphs 2 and 3 of the Amended Statement of Defence filed on 27/1/09 wherein the Defendant averred as follows:-

“2. The Defendant denies paragraphs 1, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 19, 14, 15, 16, 17, 18 and 19 of the Plaintiff’s statement of Claim and puts the Plaintiff to the strictest proof thereof

3. The Defendant denies that the Plaintiff carries on business as Edge Enterprises Nigeria and will at the trial request the Plaintiff to produce his original certificate of registration with Corporate Affairs Commission.”

The effect of the amendment is that once a pleading is amended what stood before the amendment is no longer material before the court and no longer defines the issues to be tried. See AMANAMBU v. OKAFOR (1966) 1 All NLR 205; ROTIMI v. McGREGOR (1974) 11 Sc 133; KATO v. CBN (1999) 6 NWLR (Pt.607) 390; FIRST BANK OF NIG. PLC v. ONIYANGI (2000) 6 NWLR (Pt. 661) 497.

In paragraph 4 of the Amended Statement of Defence, the Defendant pleaded thus:

“4. In response to paragraphs 3, 4 and 5, the Defendant states that the only agreement the plaintiff had with the Defendant is as contained in the agreement dated 11th June, 2004 with the annexures-thereto.