Niger Progress Limited V. North East Line Corporation (1989)

LawGlobal-Hub Lead Judgment Report

OBASEKI, J.S.C. 

The short point in this appeal is whether the appellant is entitled to have proceedings in the claim before the High Court stayed pending its reference to an arbitrator and the hearing and determination of the arbitration.

The appellant’s brief gave a brief genesis of this action when it reads:

“The suit arose out of a contract agreement Exhibit “A” entered into on 19th July, 1981 between the respondent on the one hand and a Yugoslavian duly incorporated company called SOUR FAP-Farnos Beograd. The contract agreement incorporated in Article seven (7) reference to arbitration in the event of “any dispute that may arise from this agreement.” As at the time the respondent took out the writ, no reference was made to arbitration. Thereupon, the appellant filed the objection in limine aforementioned.”

The preliminary points of objection raised by the appellant before the High Court of Justice, Borno State of Nigeria, holden at Maiduguri are as follows:

“(i) That the action is incompetent;

(ii) The suit is not properly constituted and it should be dismissed, and

(iii) The Honourable Court has no jurisdiction.”

The grounds upon which the said objection was founded were:

(a) A condition precedent to the institution of this suit has not been fulfilled by the plaintiffs, that is to say, compliance with the provisions of Article SEVEN (7) of the Contract Agreement between Sour Fap-Famos Beograd and the 1st plaintiff (defendant erroneously put down in the record) of 19th July, 1981 relating to reference to settlement by arbitration;

(b) The 2nd plaintiff is not a juristic person with capacity to sue and be sued eo nomine. In the result the second plaintiff has no locus standi.

The Contract Agreement was concluded between SOUR FAP-FAMOS BEOGRAD of BELGRADE, Francusha 61-65 (hereinafter referred to as Seller) which expression within the con of this Agreement shall also include its successors and assignees. AND the Company, Messrs. NORTH EAST LINE CORPORATION, Maiduguri, Nigeria (hereinafter referred to as Buyer) which expression within the con of this Agreement shall also include its successors and assignees. Article 7 of the Contract Agreement reads.

“Any dispute that may arise from this agreement, the contracting parties will try to solve in a peaceful way. Otherwise, the contracting parties will solve the dispute in accordance with Arbitration Laws of Nigeria or Yugoslavia provided however that any party not satisfied with the decision of the Nigerian or Yugoslav Arbitration can apply for appeal to the Arbitration Council of the Chamber of Commerce in Zurich, whose decision is final.”

After hearing arguments of counsel on the preliminary objection, the learned trial Judge, Ikeotuonye, J. delivered a considered ruling upholding the objection and made the orders prayed for in the following terms;