Nigerian Deposit Insurance Corporation V. Jackson Devos Limited (2014)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

ONYEKACHI AJA OTISI, J.C.A. (Delivering the Leading Judgment)

This is an appeal against the judgment of Hon. Justice A. Ademola of the Federal High Court, Calabar, delivered on the 21st day of January, 2011 in Suit No. FHC/CA/CS/5/2006.

These are the facts leading to this appeal as relayed by the Appellant: In 1996, the Appellant was appointed Receiver/Liquidator of both Merchant Bank of Africa and Century Merchant Bank Ltd in liquidation. After the appointment the Appellant brought an action at the Failed Banks (Recovery of Debts) and Financial Malpractices Tribunal Lagos Zone III, against the Respondent as debtor to the said Banks in liquidation.

On 13/5/97 the Appellant obtained judgment against the Respondent for the recovery of some amount of money which the Respondent owed the said two banks in liquidation. In the process of executing of the said judgment, the Appellant made some concessions. The Appellant granted the Respondent an interest waiver of 70%, thereby reducing their indebtedness to N74,597,000.00.

It was mutually agreed that the Respondent would repay the loan within 15 months, but it defaulted. In May 1998, the Appellant proceeded to seal up the Respondent’s carpet factory located at North Industrial Layout, Calabar. The Appellant, through Bailiffs of the High Court of Justice, Cross River State, took proper inventory of items in the Respondent’s factory.

The Appellant was assigned, upon request, policemen from Zone 6 Police Headquarters, Calabar, to guard and protect the factory’s property until the Nigeria Export and Import Bank (NEXIM Bank) bought over the debt and settled the Appellant. The Respondent’s said factory was thereafter handed over to NEXIM Bank, in a debt ‘buy back Agreement’.

After the said handover of the factory, the Respondent brought an action, against the Appellant, alleging that the Appellant, by its negligence, allowed the factory to be vandalized more than once and in consequence the equipment and machineries were carted away under their watch. At conclusion of the hearing, the learned trial Judge granted all the reliefs of the Respondent. Aggrieved by the judgment, the Appellant brought this appeal.

On the part of the Respondent, it is their position that the Appellant, in execution of the said judgment delivered by the Failed Banks (Recovery of Debts) and Financial Malpractices Tribunal Lagos, sealed up the Respondent’s ultra-modern carpet factory with all the equipment, machineries, vehicles, work-in-progress on the factory floor and chased away the Respondent’s workers.

The Appellant proceeded to change the keys of the entire factory premises and replace them with their own keys to effectively take physical control of the factory premises and strictly prevented the Respondent’s Directors/Representatives from entering the said factory premises.

While the Respondent was making arrangement for the repayment of the loan but worried about the security of the expensive machinery in the said factory, the Respondent wrote the Appellant, requesting for permission to allow the security staff of the Respondent to patrol and guard the vast factory alongside with the Appellant’s own guards, in order to prevent vandalization of the factory. The Appellant rejected this proposal.

The Respondent was able to secure the repayment of the loans and on subsequent inspections it was discovered that the factory had been vandalized. The Respondent took out action against the Appellant and led uncontroverted evidence before the trial court to establish that the Appellant by its negligence allowed the factory to be vandalized more than once.

The vandalization resulted in the equipment and machineries in the Respondent’s factory being carted away under the nose of the Appellant. The Respondent contended that the judgment of the trial court was based on the evidence and admissions made before the court.

In the Amended Notice and Grounds of Appeal filed on 7/6/2013, but deemed properly filed and served on 17/9/2013, the Appellant raised nine Grounds of Appeal; and sought an Order:

Setting aside the judgment and order retrial of the case.