Ogbuneke Sons And Company Limited V. Ed & F Man Nigeria Limited & Ors (2010)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

MOJEED ADEKUNLE OWOADE, J.C.A. (Delivering the Leading Judgment)

This is an appeal against the judgment of J. T. Tsoho, J., delivered on 11th March, 2005 at the Federal High court, Umuahia Judicial Division holden at Umuahia. The appellant as applicant before the Federal High Court filed an originating Motion on Notice on 27/7/2001 pursuant to Section 48 of the Arbitration and Conciliation Act, Cap. 19 LFN 1990, Orders 20 Rule 15 and 23 Rule 5 of the Federal High Court (Civil Procedure) Rules, 2000 as well as Section 36 of the Constitution of the Federal Republic of Nigeria, 1999. The Appellant’s/Applicant’s Motion on Notice before the lower court sought an order of court setting aside four International Arbitration Awards obtained in London on 15th June, 2001 by the 2nd respondent against the applicant, namely: Arbitration Award No. AA03930, Arbitration Award No. AA03931, Arbitration Award No, AA03932 and Arbitration Award No AA03933, all between the applicant and the 2nd respondent with the 3rd respondent as the institutional arbitrator.

The ground of the appellant’s/applicant’s application were as follows:

“(i) That the applicant at all material times had no arbitration agreement with the 2nd respondent, nor any of the respondents for that matter.

(ii) That the applicant did not enter into any of the purported contracts with any of the respondent which were purportedly made subjects of the said arbitrations.

(iii) That the applicant, not having any arbitration agreement with the 1st and 2nd respondents did not therefore choose the 3rd respondent as an Institutional Arbitrator, and also did not choose London as venue for any purported arbitration nor the 3rd respondent as arbitrators of his choice.

(iv) That the said awards were obtained by mis-presentation of facts and fraud.

(v) That the arbitrations and the awards thereof are against public policy in Nigeria, and

(vi) That the subject of each of the above mentioned arbitrations was/and is not a subject for arbitration under the Nigerian Law.”

The salient facts of the case are as follows. Sometime in December, 2000, the Appellant/applicant supplied a total of 250 metric tones of cocoa beans to the 1st and 2nd respondents at the cost of $774 per metric tone. When the 1st and 2nd respondents received the supply in London and weighed same in accordance with their oral agreement, they put the weight at 236.919 metric tones. Based on the respondents weighing of the supply, the 1st and 2nd respondents paid 98% of the total value of the supply but have failed to pay the outstanding balance of 2%, which they, the 1st and 2nd respondents admitted by their credit note to be $12,523.65 in favour of the appellant/applicant. However, rather than paying up the appellant’s outstanding balance the 1st and 2nd respondents decided to procure the four arbitration awards now being questioned.

In his Judgment (Ruling) the learned trial Judge agreed with the position taken by the appellant/applicant that the four awards are not valid because the 3rd respondent was ab initio denied of jurisdiction due to the absence of an enforceable contract between the parties. But added at pages 190 – 191 that:

“In the present case, there is no doubt that the letter from the 2nd respondent’s solicitors (Exhibit L) dated 3rd July, 2001 prompted the applicant to institute this action. This said Exhibit “L” is a demand letter cum notice to commence legal action, which emanated from the 2nd respondent’s solicitors to the applicant, based on the arbitral awards by the 3rd respondent. There is no mention in Exhibit “L” that the awards have been registered in Nigeria before being sought to be enforced against the applicant. Such evidence has not been furnished in this suit, even by the applicant. But it follows that if the awards are not registered, they cannot be enforced and hence there is no basis

for the institution of this action. The applicant’s action in the circumstances is anticipatory and cannot stand. On this premise, the applicant’s Originating Motion on Notice is hereby struck out.”

Dissatisfied with the judgment (Ruling) the appellant/applicant filed a Notice of Appeal containing two(2) grounds of appeal before this Court on 17th April, 2005 Appellant’s Brief of Argument dated 4/5/06 was filed on 12/5/06. The appellant also secured the order of this Honourable court on its motion dated 17/10/06 and filed on 18/10/06 that this appeal be heard and determined based on the appellant’s brief of argument for the failure of the respondents to file their brief of argument in this appeal.