Nomsal Marketing and Supplies Ltd. & Anor V. Joasy Pen Enterprises Ltd. (2005)

LawGlobal-Hub Lead Judgment Report

AMAIZU, J.C.A.

The plaintiff is a company registered in Nigeria. It carries on the business of transporter, hiring of Barges/Tugs supplies and general contractor.

It has its head office at No.11 Eboh Road, Okunmagba Layout, Warri.

By an agreement dated 29/5/96, the plaintiff agreed to hire its tugboat called “Praise Jah” to the 1st defendant. The consideration was N28, 000.00 daily, payable in advance. The agreement was to last from 1st of June 1996 to 5/7/96, a period of 35 days. The first defendant made a deposit of N350, 000.00. At the expiry of the agreement, the plaintiff on 7/7/96 issued its invoice No. 0133 to the 1st defendant demanding the balance of N630, 000.00.

The 2nd defendant who is the Chairman and the Managing Director of the 1sl defendant and the 1st defendant made a number of unfulfilled promises to pay the balance. The plaintiff filed a writ of summons against the defendants; it also obtained leave of the lower court to place the suit on the undefended list.

The claim against the defendants was jointly and severally for:-

1) the sum of N630, 000 (six hundred and thirty thousand naira) only being the amount from the defendants to the plaintiff in respect of hire/charter agreement entered into by the parties.

Interest at the rate of 10% per annum on the judgment debt until same is finally liquidated.

The defendants did not file an intention to defend the case.

They however brought a motion on notice pursuant to section 251(1)(G) of the 1999 Constitution and Order 47 Rule 1 of the High Court (Civil Procedure) Rules 1998 Delta state of Nigeria praying the court by way of preliminary objection for:-

An order striking out/dismissing this suit in its entirety for want of jurisdiction.

The grounds of the objection are:-

1) By the provisions of the Admiralty Jurisdiction Decree No. 59 of 1991, jurisdiction in Admiralty matters are vested exclusively on the Federal High Court.

(2) By the provisions of Section 251(1)(g) of the Constitution of the Federal Republic of Nigeria 1999, Admiralty jurisdiction is vested exclusively on the Federal High Court.

(3) The claim before this Honourable Court is a general maritime claim.

The lower court heard the objection and also considered the merit of the suit.

It held:-

“It is not for the defendants to deliver his defence instalmentally if he has any defence at all. It is my view that the normal procedure Order 23 of the rule is for the defendants to file his notice of intention to defend with the supporting affidavit disclosing defence, on the merit, and raise any legal issues including objection to jurisdiction….

… Having dismissed the objection, any further adjournment having regard to the procedure adopted and the clear facts of this case is to stifle justice.

In the circumstance the plaintiff has proved to the satisfaction of this Honourable court that the defendants owe the plaintiff the sum of N630, 000 unpaid. Judgment is hereby entered in favour of the plaintiff against the defendants jointly and severally for the sum of N630, 000.

The defendants shall pay interest at the rate of 5% per annum on the judgment debt till the amount is liquidated. The defendants shall pay N1000.00 cost to the plaintiff”.

The defendants hereinafter called the appellants were dissatisfied with the above judgment. They have appealed to this court on five grounds.

In accordance with the rules of this court, the parties filed and exchanged briefs of argument. The appellants formulated three issues for determination namely:-

1) Whether the trial courts assumption of jurisdiction in the suit was proper having regard to the provisions of section 2(3), (1) of the Admiralty Jurisdiction Decree No.59 of 1991 with particular regard to the accrual of the cause of action.

2) Whether it was right for the trial Judge to have entered judgment for the respondent in the course of delivering his ruling on a preliminary objection raised by the appellants’ counsel.

Or

Whether the procedure adopted by the learned trial Judge did not hinder the appellants’ right to fair hearing.

3) Whether or not the ruling of the learned trial Judge was perverse.

On the other hand, the plaintiff, now the respondent, formulated two issues for determination.

The issue, which but for the framing and the language used, boils down to the three issues formulated by the appellants.

I would consider the appeal on the three issues formulated by the appellants.

Upon the matter coming up for argument, both learned counsel adopted their respective brief of argument. Iheme Esq., of counsel urged the court to allow the appeal.

On the other hand, Oghenejakpor Esq of counsel urged the court to dismiss the appeal as lacking in merit.

I now consider the submissions of the learned counsel. I start with Issue One.

Arguing issue one, Iheme Esq., of counsel, submitted that the lower court erred in law when it over ruled the objection to its jurisdiction raised by the appellants’ counsel.

This, notwithstanding the glaring provisions of the various statutes.

The learned counsel observed that the claim for the sum of N630, 000.00 (Six hundred and thirty thousand naira) flows from the hire/use of the respondent’s Tugboat as shown on the writ of summons. He submitted that it is the particulars of claim – writ of summons and the statement of claim, in this case, the affidavit, that are to be looked into in order to determine the courts’ jurisdiction in a particular suit. He cited the case of Mpidi Barry v. Obi A. Eric (1998) 8 NWLR (Pt.562) P. 404 at P. 418 – 419.

In the light of the foregoing, he submitted that the respondents’ claim falls exclusively within the jurisdiction of the Federal High Court and not the state High Court. The reason being that the claim is for the balance of rentals on a Tugboat, which falls within the definition of a ship under section 26(1) of the Admiralty Jurisdiction Decree No. 59.

The section defines a ship to mean:-

“… a vessel of any kind used or constructed for use in navigation by water, however it is propelled or moved and includes …. ”

The learned counsel refers also to the definition of the word vessel in Black’s Law Dictionary Sixth Edition page 1562 as:-

“a ship, brig, sloop or other craft used or capable of being used, in navigation on water. ”

The same dictionary defines a Tugboat as:-

“a small powerful steamer for towing e.g. larger ships logs etc”

The learned counsel then referred to paragraph 3 of the respondent’s affidavit in support of its claim in the undefended list.

The paragraph reads that the respondent hired its Tugboat to the 1st appellant and the Charter party agreement entered into between the parties is exhibit E01 to the said affidavit:-

He observed that paragraph 3(a)-(d) of the affidavit in support of the appellant’s motion on preliminary objection which was not challenged, contradicted, or, controverted, showed clearly that the action was one for the Federal High Court.

He then submitted that the rents on the said tugboat flowed or accrued from the use or hire of the tugboat (ship), and, by the very provisions of section 2(3), (f) of the said Decree No. 59 of 1991 it qualifies as a general maritime claim.

Section 2(3) (f) thereof provides:-

“a claim out of an agreement relating to the carriage of goods or persons by a ship or to the use or hire of a ship, whether by charter party or otherwise”

The learned counsel then submitted that the word claim as used in the section is all embracing as it includes debts whether admitted or not, rentals, declarations, indemnity, claims on personal injuries arising from the use or hire of any object or equipment over which jurisdiction is conferred on the Federal High Court.

In view of the foregoing, the learned counsel submitted that the findings of the lower court that:-

“However there is no direct provision relating to an admitted debt arising from agreement affecting hire of a vessel” and

“it is my view that the issue of debt from rental and the personal guarantee of the debt are not within the substantive and specific provisions of the Admiralty jurisdiction Act and are therefore not vested exclusively in the Federal High Court such ancillary matters can be determined by the State High Court because the Federal High Court only has jurisdiction to deal with specific admiralty matter over which jurisdiction is conferred on”, is faulty, baseless and wrong as same is not supported by any statutory provision or case law.”

He submitted that the case of N. V. Scheep v. M. V “S Aras” which the lower court relied on was completely misconceived and misapplied by the lower court. Finally, the learned counsel submitted that the Admiralty jurisdiction Decree did not dichotomise between substantive and specific and ancillary matters as postulated by the trial judge. In his view, the claim of the respondent for all intent and purpose is a maritime contract whether entered on land or not, whether for debt or not so long as the contract is for something to be used or to happen in the sea. He relied on the case of Allco v. Ceekay Traders Ltd. (2001) FWLR (Pt. 47) P.1163 at 1186. He urged the court to declare the decision of the lower court a nullity as it was given without jurisdiction. And to resolve the issue in favour of the appellant.

In his reply, Oghenejakpor Esq., of counsel submitted that the lower court had jurisdiction to entertain the suit, which related to a simple debt arising from the 1st appellants’ use of the Tugboat belonging to the respondent and which debt was guaranteed by the 2nd appellant as per exhibit E03.

The learned counsel conceded that it is the claim of a plaintiff, in this Suit the respondent, that determines the jurisdiction of a court, and not the defence of the defendant here the appellant:-

He cited:-

1) Adeyemi v. Opeyori (1976) 9-10 SC 31

2) Ikine & Ors. v. Edjorode & Ors. (2002) FWLR (Pt.92) 1775 at 1811.

It is the learned counsels’ view that since court of record that heard the case (State High Court), is a superior court of record, its jurisdiction cannot be taken away, except by very clear words. And the provision of such a statute ousting the ordinary jurisdiction of a court is construed strictly. Ikine & 7 Ors. v. Edjerode & Ors. (2002) FWLR (Pt.92) 1775 at 1815; (2001) 18 NWLR (Pt.745) 446. He contended that the jurisdiction of a superior Court of record couldn’t be ousted by implication. It must be by an express provision excluding the jurisdiction. Sodehinde & Ors. v. Ahmadiya Movement in Islam (2001) FWLR (Pt.58) 1065.

The learned counsel further Submitted that the Admiralty Jurisdiction Decree, 1991, did not expressly provide that a rent accruing from a tugboat or even a ship is a general maritime claim.

He contended that the conclusion could only be arrived at by way of implication from section 2(3) F of the Admiralty Jurisdiction. And, the jurisdiction of a superior court of record cannot be ousted by implication. It is the view of the learned counsel that the respondent’s claim does not have anything to do with the movement of the Tugboat in the sea or the execution of the contract, which was concluded since 1996. The claim, he submitted related to debt for services rendered by the respondent to the 1st appellant and which debt the 2nd appellant also admitted and guaranteed in exhibit E03. It is further the learned counsel’s contention that a claim relating to debt for services rendered by a Tugboat, and the guaranteeing of such a debt are not general maritime claims under Admiralty Jurisdiction Decree 1991 but a simple debt which a State High Court has the jurisdiction to entertain. He referred in this regard to the case of Texaco Oversea (Nig.) Petroleum Co. Unlimited v. Pedmar Nigeria Limited (2002) FWLR (Pt.l26) 885 at 896 & 897; (2002) 13 NWLR (Pt.785) 326.

It is his view that the fact of the present case and the facts of the case of Texaco Overseas (Supra) and indeed issue one in the two cases are the same. He urged the court to resolve the issue in favour of the respondent.

It does seem to me from the submissions of the learned counsel for the parties that the resolution of this issue calls for the interpretation of the provisions of the Admiralty Jurisdiction Decree 1991. In particular, it calls for the interpretation of section 2(3), F of the said Decree. The section provides:-

“2(3) a reference in this Decree to a general maritime claim is a reference to:-

(f) a claim out of an agreement relating to the carriage of goods or persons by a ship or to the use or hire of a ship, whether by charter party or otherwise”. I seem to agree with lheme Esq., that the word claim as used in the section is “all embracing” in other words it is wide. The question is does the word claim cover the present claim in the suit?

A look at the record of proceedings shows that there is an agreement between Joasy Pen Enterprises Ltd. as the ‘Owner’ and Nomsal Marketing and Supplies Ltd. as the “Charterer”.

The two parties are limited liability companies. In other words, they are legal persons with capacity to enter into contract and consequently to sue and be sued.

On the other hand, the parties in the suit in the lower court are:-

J) Nomsal Marketing And Supplies Ltd.

2) Mr. fonny I. Ifeanyi

And

Joasy Pen Enterprises Ltd.

This leads to another question. Why was the action initiated against Nomsal Marketing and Supplies Ltd. and the 2nd defendant?

To find the answer one has to look at the claim before the lower court. The relevant parts of the claim are paragraphs 6 -11.

They read:-

“6. That between July 1966 and September 2000, the 1st defendant made series of unfulfilled promises to pay the sum of N630, 000.00 to the plaintiff.

7. That in September 2000, the plaintiff decided to go to court to recover the debt but the 2nd defendant pleaded and personally guaranteed to pay the sum of N630, 000.00 on or before 31/10/2000. A copy of the 2nd defendants’ guarantee is exhibited hereto and marked exhibit E03.
8. That based on the 2nd defendant pleadings and guarantees the plaintiff did not go to court in September 2000.
9. That the defendants have refused to pay the debt despite repeated demands till date.
10. That the plaintiff has now applied for a writ of summons claiming this debt and I honestly believe that the defendants have no defence to this action.
11. That I depose to this affidavit in good faith and conscientiously and in accordance, with Oath Laws”

It does seem to me from the above facts that the action was not based on the agreement between the two companies but on exhibit E03. It is because of this that the action was brought under the undefended list procedure. The procedure is a truncated form of the ordinary civil hearing peculiar to our adversary system where the

ordinary hearing is rendered unnecessary, due in the main to the absence of issue to be tried or the question of the plaintiff’s claim disputed, to necessitate such a hearing Bernard Agwuneme v. Felix Eze (1990) 3 NWLR (Pt.137) 242.Otherwise, why was the 2nd appellant made a party” He was not a party to the original agreement.

In addition to my above, I adopt EJIWUMI JSC’s Observation in the case of Texaco Overseas (Nig.) Petroleum Co. Unlimited v. Pedmar Nigeria Limited (2002) FWLR (Pt.126) 885 at 896 & 897; (2002) 13 NWLR (Pt.787) 526. The facts are similar to the facts of the present case. It is his conclusion that:-

“After due consideration of the facts narrated above, I am in no doubt that the contention of the appellant that this is a case whose facts are sound in admiralty cannot.

This is simply a case of debt owed by the appellant to the respondent. The goods, which the chartered vessels carried, have quite clearly been delivered to the appellant as agreed. I must therefore resolve this question against the appellant”.

I also resolve the issue in favour of the respondent.

Arguing issue two, Iheme Esq., of counsel, submitted that the learned trial Judge was wrong to have entered judgment for the respondent in the course of delivering his ruling on the preliminary objection without giving the appellants an opportunity to present their defence. It is his contention that by delivering the judgment, the learned trial Judge hindered the appellants’ right to a fair hearing and thus occasioned a miscarriage of justice.

The learned counsel submitted that the issue of jurisdiction could be raised at any stage of the proceedings. And, once it is raised the court must determine same before anything. He cited the following cases:-

1) Adah v. NYSC (2000) FWLR (Pt.30) P. 2539; (2001) 1 E NWLR (Pt.693) 65.

2) A.-G., Federation v. Guardian Newspapers Ltd. (2201) FWLR (Pt. 32) P. 87; (1999) 9 NWLR (Pt.618) 187.

Counsel then referred to the case of National Bank of Nig. Ltd. v. Shoyoye & Ors. (1977) 1 All NLR P. 168 at 177. He contended that the appellants were right in law to have filed their preliminary objection against the jurisdiction of the lower court to try the case without filing a notice of intention to defend and an affidavit disclosing a defence on the merit. It is his view that it was wrong for the learned trial Judge to hold that the filing of the Preliminary Objection without filing a notice of intention to defend was inimical to the defendants’ defence. He contended that the court ought to have considered and determined the objection to jurisdiction first.

And, having ruled against the objection ought to have given the appellants an opportunity to file their notice of intention to defend and an affidavit disclosing a defence on the merit before proceeding to give judgment against them.

He observed that the right to fair hearing is an entrenched fundamental right in our Constitution. He cited the case of Solomon Ogboh v. The Federal Republic of Nigeria (2002) 97 LRCN P. 946 at 956; (2002) 10 NWLR (Pt.774) 21. He finally referred to the case of Ozara Ekuma v. Silver Eagle Shipping Agencies (PH) Ltd. (1987) 4 NWLR (Pt.65) 472, which was decided on the undefended list procedure wherein the issue of fair hearing was emphasized.

He urged the court to resolve the issue in favour of the appellants.

In his reply, Oghenejakpor Esq., of counsel observed that the undefended list procedure is a special procedure and a defendant who intends to defend an action placed under the undefended list is under an obligation to file a Notice of Intention to defend and in affidavit disclosing defence on the merit, at least five days before the day fixed for the hearing. Order 23 Rule 3 (1) of the Bendel State High Court (Civil Procedure) Rules 1988 applicable to Edo State was referred to. He cited Owen Alale & Ors. v. Okwo Olu (2000) FWLR (Pt. 23) 1294 at 1306; (2001) 7 NWLR (Pt.711) 119.

It is the view of the learned counsel that the lower court gave the appellants ample opportunity to present their defence, if they had any. He observed that the suit was brought under the undefended list and was called up for hearing on 11/6/2001. The appellants asked for adjournment on that day, and on 11/7/2004 when the case was also fixed for hearing. He contended that as the appellants neglected to file their notice of intention to defend, and an affidavit disclosing defence on the merit, they cannot complain of being denied the right of fair hearing.

He submitted that the appellant chose not to file a Notice of Intention to defend as required by the Rules but instead resorted to file a motion to challenge the jurisdiction. It is his view that the intention of the appellant was to delay the trial. He relied on Sylvester Ogbanu v. Gabriel Oti (2000) 8 NWLR (Pt .670) P.582.

He urged the court to resolve the issue in favour of the respondent.

Fair hearing in relation to a trial means a trial conducted according to all the legal Rules formulated to ensure that justice is done to the parties. What constitutes fair hearing depends on the circumstances of each case. The real test however is an objective one. Saba v. Nigeria Civil Aviation Training Centre (1986) 5 NWLR (Pt.42) 514. Order 23 of the High Court (Civil Procedure) Rules, 1988, regulates hearing of cases under the Undefended List Procedure. Rules 3 (1) thereof provides:-

“If the party served with the writ of summons and affidavit delivers to the Registrar, not less than five days, before the date fixed for hearing a notice in writing that he intends to defend the suit, together with an affidavit disclosing a defence, on the merit, the court may give him leave to defend upon such terms as the court may think just”

And under Rule 4:-

“Where any defendant neglects to deliver the notice of defence and affidavit prescribed by rule 3(1) or is not given leave to defend by the court, the suit shall be heard as an undefended suit, and judgment given thereon without calling upon the plaintiff to summon witnesses before the court to prove his case formally.”

In the present case, the case was entered on the undefended list on 17th day of May 2001. It was adjourned to 11/7/2001. On the 10th of July 2001, the appellant brought a motion on notice for an order striking out/dismissing the suit in its entirety for want of jurisdiction.

From the foregoing facts the provisions of Order 23 Rule 3(1) of High Court (Civil Procedure) Rules, 1988 were not complied by the appellants. The learned trial Judge was therefore justified to hear the case under rule 4. The issue of fair hearing does not arise as the appellants did not fulfill the condition precedent to their being heard.

Issue 2 is resolved in favour of the respondent.

On issue 3, Iheme Esq. of counsel submitted that the decision of the lower court is perverse and same occasioned a miscarriage of F justice. He contended that from the reasoning of the trial Judge in his ruling, a defendant in a suit brought under Order 23 of the High Court (Civil Procedure) Rules, 1988 applicable to Delta State, cannot raise any objection, particularly one on jurisdiction, without first filing his notice of intention to defend and the affidavit disclosing a defence on the merit. It is his view that it is not the intendment of Order 23. He submitted that the learned trial Judge shut his eyes to the fact that if the defendants had filed a notice of intention to defend and affidavit disclosing a defence on the merit, they would have been deemed to have submitted to jurisdiction and thereby caught by the principle of waiver. He relied on:-

1) Okechukwu Adimora v. Nnanyelugu Ajufo (1988) 3 NWLR (Pt. 80) P. 1 at 15 – 16.

2) Bisiruyu Agbomeji v. Laidi Bakare (1998) 9 NWLR (Pt.564) P.1 at P. 8.

He urged the court to resolve the issue in favour of the appellants.

I observe that the respondent treated issues 2 & 3 together.

Having said this, the point has to be made that it is only where the conclusion arrived at by a trial court or tribunal is not justified by the evidence led by parties or where vital pieces of evidence were not adverted to, that a decision is said to be perverse. Alhassan Ado Garba v. Alhaji Saidu Ali Galadima (1993) 4 NWLR (Pt.285) P. 72.

In the present case, one has to note that at the time the appellants filed their preliminary objection, the lower court could have given its judgment under the provisions of rule 4 supra. It follows that the point being made by the learned counsel cannot be sustained.

Consequently, the Issue 3 is resolved in favour of the respondent.

Having resolved all the issues in favour of the respondent, the appeal fails as having no merit. It is accordingly dismissed. I make no order as to costs. The appeal is dismissed.

Other Citations: (2005)LCN/1760(CA)