Otunba Mabayoje Oshinowo V. National Bank of Nigeria Ltd. (1998)
LawGlobal-Hub Lead Judgment Report
ADAMU, J.C.A.
The appellant as plaintiff sued the respondent in the High Court of Ogun State holden at Ijebu-Ode claiming (as per the writ of summons) as follows:
“1. A declaration that the deed of mortgage dated the 20th of July, 1983 from the plaintiff to the defendant and registered as No.37 at page 37 in volume 212 of the Land Registry Abeokuta is ineffectual and inoperative as the plaintiff never drew on the facility purportedly secured by the deed of mortgage.
or alternatively
A declaration that the said deed of mortgage is ineffectual and inoperative in that the debt, if any, secured by the deed of mortgage has not crystallized and has thus not become payable.
- An order that the defendants do discharge the said mortgage and issue a deed of release in favour of the plaintiff.
- Perpetual injunction restraining the defendant, its assigns, privies and agents from dealing with the property lying and being along Lagos/Ondo Road. Ijebu-Ode (otherwise known as Ijebu Ode Bye-pass) Ogun State and utilized in the said deed of mortgage either by way of sale, assignment, mortgage or lease.”
The defendant/respondent was served with the writ of summons containing the above claims (or reliefs) on 20/6/91 and it entered a conditional appearance through its counsel on 26/6/91. The plaintiff/appellant (hereinafter simply called “the appellant”) has also filed a motion on notice on 20/6/91 (the same date the writ was filed) for an order of interlocutory injunction restraining the defendant/respondent (also hereinafter simply called the respondent”) until the final determination of the action as per the relief in the writ (as reproduced above). The motion on notice was served on the respondent on 16/7/91. On the same date, the appellant became aware of an auction notice (or advertisement) for the sale of the property which was published on 16/7/91 in the National Concord newspaper (i.e. a day before the service of the motion on the said respondent). The appellant’s counsel on becoming aware of the notice (advertisement) publication promptly wrote a letter of warning or caution to the respondents counsel while also copying the auctioneer (see P.20 of the record). When the motion for interlocutory order of injunction came up for hearing on 1/8/91, the respondent swore to a counter-affidavit stating that the property, the subject matter (or res) in the suit had been sold since on 25/7/91 and as such there was nothing to be restrained. The appellant then filed another application on 9/9/91 for an order setting aside the purported sale on the ground that it was conducted pendente lite during the pendency of the motion for interlocutory injunction. The appellant also in the same subsequent application (or motion) sought for another order to restrain the respondent from executing any document of transfer of the property in favour of the purchaser pending the determination of the suit. The subsequent application was heard by the trial court which dismissed it in its ruling of 29/11/91. It is against this ruling of the trial court that the appellant is appealing to this court.
The appellant filed 3 (three) grounds of appeal with his notice of appeal from which the following three issues for determination are formulated in the appellant’s brief filed in accordance with the rules of this court and adopted and relied upon by his counsel at the hearing of the appeal on 1/6/98:-
“(a) Whether the learned trial Judge should not have set aside the sale of a property carried out during the pendency of motion on notice for interlocutory injunction to restrain the said sale particularly as the purported vendor had been served with a copy of the motion on notice for injunction.
(b) Whether the learned trial Judge was right in holding that the doctrine of lis pendens does not invalidate a sale of the property which is the subject-matter of an action pending in court during the pendency in court of the action but acts only to suspend the vesting of the title in the purchaser until the final determination of the action.
(c) Whether the non-joinder of the Ijebu-Ode Local Government, the purported purchaser of the subject-matter pendente lite, on the hearing of the application to set aside the sale was fatal to the application.
In its own brief which was also duly adopted and relied upon at the hearing of the appeal the respondent conceded to the above issues of the appellant which are replied to in the respondent’s brief. It is to be noted that although the respondent’s brief formulates its own two (2) issues which are different from those of the appellant as reproduced above, the arguments under the said two issues which are too brief and superficial attempt to reply to the appellant’s issues (in only 3 pages). Thus in my view the respondent’s brief herein does not substantially or materially answer all the points raised in the appellant’s brief and consequently does not comply with the provision of Order 6 rule 4(1) of the Court of Appeal Rules 1981- See Yahaya v. Oparinde (1997) 10 NWLR (Pt.523) 126. It is important and incumbent on the learned counsel representing the respondent to answer all the material issues of substance raised in the appellant’s brief and his failure to do so is a dis-service to his client. It is also a lack of diligence on the part of the counsel in the conduct of his client’s case at this level. Be that as it may, I will still in fairness to the party concerned consider the writ of the arguments in the said respondent’s brief under the issues as formulated and argued in the appellant’s brief in so far as they are relevant, clear and coherent.
In arguing the 1st issue, the appellant’s brief relies upon an affidavit of service (at page 17 of the record) which shows that the respondent had been served with the motion for interlocutory injunction on 16/7/91. It is argued in the brief that despite this notice (or service) of a pending motion the respondent still went ahead and sold the property (the subject matter of the dispute) on 25/7/98. It is pointed in the brief that this fact was admitted by the said respondent in paragraph 2 of its counter-affidavit filed in opposition of the motion on notice (see page 8A of the record referred to in the appellant’s brief). It is submitted in the said brief that by its action in selling the property in dispute when there was a pending motion, the respondent had acted unilaterally and illegally to the prejudice of the appellant/applicant and had also taken the law into its hand. The action is also said to be in bad faith and with a view to prejudicing the hearing or adjudication of the matter by the trial court – See the cases of Ezegbu & Anor v. First African Trust Bank Ltd. & Ors. (1992) 1 NWLR (Pt.220) 699 at 724 – 725. Governor of Lagos State v. Ojukwu (1986)1 NWLR (PU8) 621; Amadi Opara v. Godfrey Ihejirika (1990)6 NWLR (Pt.156) 291 at 304; Ajayi v. Union Bank of Nigeria Ltd. (1989)1 CLRQ 220 cited in the brief in support of the submission.
It is further submitted in the brief that a party to an action cannot or should not take any action during the pendency of the action (or motion as in the present case) that will overreach any decision the court may arrive at in the action or motion. Where such an illegal action or step is taken it becomes the duty of the court to reverse it. It is argued in the brief that in the present case the failure of the learned trial Judge to reverse or set aside the illegal sale even when an application for that purpose was made before him (see pages 10-10A of the record) was in error and has led to a miscarriage of justice. We are finally urged under the issue by the appellant to hold so and to allow the appeal.
The 2nd issue of the appellant which is on the doctrine or principle of lis pendens is in my view related to or akin to the 1st issue as set out above and can be conveniently treated together in this judgment even though it is treated separately in the said appellant’s brief. The gravamen of the appellant’s arguments or submissions under the issue is directed against the holding of the learned trial Judge that the sale of the landed properly in dispute which was carried out pendent lite when there was a motion on notice served on the respondent was proper and that the doctrine of lis pendens only operates to suspend or put in abeyance the vesting of the title to the purchaser pending the determination of the action (or motion).
It is argued in the brief that such a sale during the pendency of an action (or litigation) has been held by the Supreme Court to be ineffective under the doctrine of lis pendens and cannot transfer any title to the purchaser whether with or without notice – pendente lite nihil innovetur – see Belany v. Sabine (1857)26 LJ (N.S.) Equity Report 777 at 303; Ogundiani v. Araba (1977-78) NSCC Vol. II 334 at 346 – 347; Barclays Bank of Nigeria Ltd. v. Ashiru & Ors. (1977 – 78) NSCC Vol. II 351 at 366; John Osagie v. Alhaji S. O. Oyeyinka & Anor. (1987) 3 NWLR (Pt.59) 144 cited in the brief in support of the submission. It is also submitted that the attempt made by the learned trial Judge to distinguish the Supreme Court’s decisions in Ogundaini v. Araba (supra); Barclays Bank of Nigeria Ltd. v. Ashiru (supra); and Osagie v. Oyeyinka and his holding (at p.33 of the record) that the decisions are at variance on the doctrine were made in error and therefore misconceived. It is argued that there was not any conflict or variation in the decision as regards the application of the doctrine. The Supreme Court rather than contradicting or overruling its earlier decisions had in fact reaffirmed its earlier stand on the application of the doctrine (of lis pendens), the brief argues. We are finally urged the 2nd issue of the appellant to hold that there is no conflict whatsoever in the decision of the Supreme Court on the doctrine and to hold that the doctrine applies in the present case to render the sale by the respondents pendente lite as null and void.
In the respondent’s brief and reply of the above two issues has been compressed or condensed in form of a synopsis. I have already criticised the said brief for being obscure and unclear in both its wordings and substance. What I can decipher from the mess is that since a 3rd party (the purchaser) was to be affected by the order sought in the interlocutory applications for setting aside the sale, it should have been made a party to the application and the failure to do so was a denial of fair hearing and contrary to section 33(1) of the 1979 Constitution. It is also stated in the brief that in the case of Ezegbu & Anor. V. First African Trust Bank Ltd & Ors. (supra) the 3rd party to be affected (i.e. the purchaser) was made a party to the action whereas in the present case the purchaser was not made a party. Thus the case is distinguishable from the present case. – See also Barclays Bank of Nigeria Ltd. V. Ashiru & Ors. (Supra) – Both referred to in the respondent’s brief. We are finally urged under the two issues to uphold the ruling of the lower court and to dismiss the appeal.
From the above submissions and arguments under the two issues as canvassed in the respective briefs of argument the main issues raised and which need to be decided is centred on the legality or effect of the sale of the property which was the subject matter of the suit when there was a pending motion on notice for a interlocutory injunction against such sale which motion was served on the respondent. In other words whether or not the sale of the property pendente life was caught by the doctrine of lis pendens and was therefore rendered null and void. In determining this main issue. I have to recall that both the respondent and the purchaser – i.e. Ijebu-Ode Local Government were served with the motion on notice by the bailiff on 16/7/91 and there is an affidavit of service to that effect as rightly pointed out in the appellant’s brief (see page 17 of the record). In addition to this and when the learned counsel for the appellant became aware of a publication of an auction notice of the property in the National Concord of 15/7/91 – a day before the service of the motion, he immediately and on the same date (i.e. 16/7/91) wrote a letter to the respondent’s counsel advising him against the intended sale (see page 20 of the record). This letter was also copied to the auctioneer. However despite all the measures or steps taken by the appellant and his counsel to prevent the sale, the respondent disregarded everything and went ahead to sell the property by auction as averred in paragraph 2 of their counter affidavit (at page 24 of the record) that the sale had been carried out on the 25/7/91. I think this averment coupled with the undefined affidavit of service of the motion for interlocutory injunction since 16/7/91, is an admission by the respondent that the sale took place about 9 days after the service on them of the motion and during the pendency of the said motion. Under these circumstances, it is my humble view that the sale of the property by the respondent was caught by the principle or doctrine of lis pendens as rightly submitted in the appellant’s brief. It is trite that where there is sale or conveyance of the land in dispute by either side to a litigation which is made pendente lite as in the present case, the purported purchase would be ineffective and must be set aside as void. This is because the doctrine of lis pendens affects the purchaser who buys property the subject matter of litigation during the pendency of such litigation as the law does not allow parties to the suit or give them any right in the property in dispute pending the litigation as that would prejudice the opposite party. Thus, after the defendant has been notified of the pendency of a suit seeking an injunction against him, his subsequent act is at his peril and is subject to the power of the court to restore the status quo wholly (i.e. to set it aside) irrespective of the merits as may ultimately be dreaded – See Governor of Lagos State v. Ojukwu (supra); Kigo (Nigeria) Ltd v. Holman Bros. (Nigeria) Ltd (1980) 5 – 7 SC 60 at 73; Ogundiani v. Araba (supra); Barclays Bank v. Ashiru (supra); Okafor v. A.G. Anambra State (1988) 2 NWLR (Pt. 79)736; Majekodunmi v. Co-Operative Bank Ltd & Anor. (1997) 10 NWLR (Pt.524) 198 at 219 – 220.
In view of the above authorities, it is difficult to see the reason why the learned trial Judge in the present case refused to set aside the sale of the property by the respondent which has been admitted and accepted by both parties to have been conducted during the pendency of the motion for an interlocutory injunction against the sale duly served on the respondent. Such a sale which is void in law under the equitable doctrine of lis pendens should have been set aside by the learned trial Judge. The reason given by the said trial Judge for his refusal to set the sale aside (i.e. that the doctrine only operates to put the title transferred in abeyance pending the final determination of the suit or motion) is far-fetched and misconceived. So also was the learned trial Judge’s attempt to distinguish the Supreme Court’s decisions on the doctrine of lis pendens which he held as contradictory. Under the law the doctrine of stare decisis – even if the learned trial Judge found the decisions of the Supreme Court as contradictory, he should not refuse to apply them and he is bound to follow them rather than interpreting them in his own way to suit his purpose. – See A.G. Ogun State v. Egenti (1986) 3 NWLR (Pt.28) 265 at 272; Jalo Tsamiya v. Bauchi N. A. (1957) NRNLR 72 at 82 – 83; and Pascal & Ludwig Inc. v. Kiren (1975) 1 NMLR 74 at 77 – 78. Even if the Supreme Court’s decisions on the doctrine were found to be conflicting or even per incuriam the learned trial Judge being of a lower court in the judicial hierarchy cannot depart from or refuse to apply them. Moreover, the point of distinction drawn by the learned trial Judge on the Supreme Court’s decisions which led to his subsequent refusal to apply them – namely because the purchaser was not made a party – is based on a very shallow analogy. Contrary to the reason given by the learned trial Judge the doctrine of lis pendens is of general application in every case where actions or steps are taken by a party during the pendency of the litigation especially where such actions or steps are prejudicial to the adverse party or are capable of over-reaching the subsequent decision of the court or the final outcome of the case.
In the case of Ajuwon v. Akanni (1993)9 NWLR (Pt.316) 182 at 197 – 198 restated the general nature of the doctrine without limiting it to whether or not a purchaser is made a party. It is pertinent to state that although in most cases of this nature the purchaser is a party or is joined as such, there is nothing to prevent the court from pronouncing the nullity of such sales pendente lite which are void ab initio whether or not the said purchaser is joined as a party. Thus the dispute from the initial stage is between the mortgagee and the mortgagor and if the purchaser desires or requires he may apply to be joined. In the present case there is no allegation that the purchaser had applied to be joined and such application was refused.
In view of my considerations of the issues land 2 of the appellant’s brief, the two issues and their corresponding grounds have succeeded. They are consequently hereby resolved in favour of the appellant.
Issue No.3 of the appellant’s brief which is based on the non-joinder of the purchaser – i.e. the Ijebu-Ode Local Government – which was held by the learned trial Judge to be fatal to the application and contrary to the right of fair hearing as enshrined in section 33(1) of the 1979 Constitution has been tackled in my consideration of the 1st and 2nd issues above. The said 3rd issue has thus been submerged and overtaken in my discussions under the 1st and 2nd issues. In the result, the said 3rd issue and its corresponding ground must also be resolved in favour of the appellant and I hereby so resolve it.
Finally with my resolution of all the 3(three) issues in the appeal in favour of the appellant, the appeal has succeeded and must be allowed. I hereby accordingly allow it. The ruling of the lower court delivered on 29/11/91 is hereby set aside. In its place the appellant’s application to set aside the sale of the properly in dispute which was carried out by the respondent is hereby granted as prayed and the said sale which was conducted during the pendency of a motion on notice for interlocutory injunction is hereby set aside. I assess the costs of this appeal at N1, 500.00 which I hereby award in favour of the appellant.
Other Citations: (1998)LCN/0375(CA)