Progressive Insurance Co. Ltd V Mrs. M.T. Adepoju (1990)

LawGlobal-Hub Lead Judgment Report

AGORO, J.C.A.

This appeal has again raised the vexed problem regarding the scope of the jurisdiction of the Federal High Court in relation to the State High Courts. The facts of the case before the Federal High Court, Ibadan were that the respondent as plaintiff insured her Santana LX Saloon Car registration No. OY 620 MN for N11 ,000.00 with the defendant/appellant on 29th October, 1984. It was a comprehensive insurance for the period 29th October, 1984 to 28th October, 1985, for which a premium of N814.00 was paid to the said insurance company.

A cover note No.036336 was later issued to the plaintiff /respondent for the period 8th November, 1985 to 7th December, 1985. And on or about 16th November, 1985 a premium of N732.60 was paid to cover the second year of insurance from 8th November, 1985 to 7th November, 1986 both dates inclusive. The vehicle was involved in an accident on 23rd November, 1985, and a claim of N11,000.00 was presented to the insurance company because the vehicle was said to have been damaged beyond repairs. Apart from denying liability for the claim, the defendant/appellant averred in the statement of defence that the Federal High Court had no jurisdiction to entertain the suit.

Upon a motion on notice brought under Order 33, Rule 7 of the Federal High Court Civil Procedure Rules, 1976, the defendant/appellant sought to set aside the writ of summons and its service for lack of jurisdiction. After hearing the learned counsel for the parties, Okuribido, J. (now retired) overruled the objection to the jurisdiction of the court. The learned trial Judge then proceeded to take evidence, and at the conclusion of the hearing judgment was entered in favour of the plaintiff/respondent in the sum of 0 N6,892.15. The present appeal is against the said judgment, and the main complaint of the defendant/appellant was that the learned trial Judge erred in law to have adjudicated on the claim when he had no jurisdiction.

As it happened, the only issue for determination as formulated in the appellants Brief of Argument, is whether or not the Federal High Court has jurisdiction to sit over the claim which is purely that of an insured and insurer in view of the provisions of the laws setting out the courts jurisdiction. The respondents Brief of Argument also agrees that the main issue for determination is whether or not the Federal High Court has jurisdiction to adjudicate over the claim of the plaintiff which is an insurance claim.

The only subsidiary issue raised by the respondent relates to the consequential order to be made if the appeal succeeds on the issue of jurisdiction. It was submitted in the appellants Brief that having regard to the jurisdiction of the Federal High Court as contained in Section 7 of the Federal High Court Act. 1973, as well as Section 230 of the 1979 Constitution of the Federal Republic of Nigeria, the subject-matter of the suit before the lower court is not a matter which falls under those provisions. It was also submitted that a claim purely between an insured and an insurer, such as in this appeal, where the Federal Government does not have the slightest interest, is not a matter to be instituted in and adjudicated upon by the Federal High Court.

Accordingly, it was submitted that the proceedings before Okunribido, J. in the court below were conducted without jurisdiction and were consequently null and void. The cases of Jammal Steel Structures Ltd. v. African Continental Bank Ltd. (1973) 1 All N. L. R. (Pt, 11) 208; Bronik Motors Lid, v. Wema Bank Ltd. (1983) 1 SCNLR 296 and Eze v. The Republic (1987) 1 NWLR (Pt.51) 506 were cited in the appellants Brief of Argument.

The position of the respondent as contained in the Brief of Argument is a challenge to the appellants argument that the true object and purpose of the Federal High Court Act, 1973 is the more expeditious despatch of revenue cases, particularly those relating to the revenue of the Federal Government of Nigeria.

In this connection, reference was made to the case of American International Insurance Company v. Ceekay Traders (1981) 1 All N.L.R. (Pt. 1) 58, where the Supreme Court of Nigeria held, inter alia, that since the commencement of the Federal High Court Act. 1971, admiralty jurisdiction has been vested in the Federal High Court to the exclusion of all the High Courts of the States in the Federation. The decision in the case of Jammal Steel Structures Co. Ltd. v. A.C.B. Ltd. (supra) was distinguished and reviewed by the Supreme Court. It was also contended by the respondent that unless the jurisdiction of a superior court is ousted by statutory provisions either expressly or by necessary implication, the presumption is that it can entertain any legal dispute that comes before it. The case of Timitimi v. Amabebe (1953) 14 W.A.C.A.374 at 376 was cited in support.

It was further contended by the respondent that since the defendant/appellant is a limited liability company carrying on the business of an insurer throughout Nigeria with its head office at Akure, it falls within the provision of Section 7(1)(c)(i) of the Federal High Court Act, 1973, and that the Federal High Court has and can exercise jurisdiction in civil cases and matters arising from the operation of the said company. The respondent has drawn attention to Section 230 of the 1979 Constitution of the Federal Republic of Nigeria, as well as sections 42(1)(2),237(1)(2) and 274 thereof relating to fundamental rights enforcement provisions, election petitions in respect of the offices of the President and Vice-President; while section 274 deals with existing laws.

As regards the case of Bronik Motors v. Wema Bank Ltd. (supra) cited by the appellant, the respondent submitted that the Supreme Court of Nigeria decided the case on its peculiar facts and also that if the opportunity arises the Supreme Court wil1 extend its scope beyond sections 21(1),49(1) and 62 of the Insurance Act, No. 59 of 1976. And with reference to the case of Eze v. The Republic (supra), the respondent is content to adopt the observation of Karibi­ Whyte, J .S.C. at pages 506, 522 and 523. Finally, the respondent urged this court to affirm the judgment of the lower court and also to dismiss the appeal.

In the alternative, if this court allows the appeal, then the case should be sent to the Federal High Court for onward transmission to Oyo State High Court, Ibadan in accordance with the provisions of section 22(2) of the Federal High Court Act, 1973 and Section 22(3) of the Federal High Court (Amendment) Act No.36 of 1975. This courts attention has been drawn to the cases of Mokelu v. Federal Commissioner for Works and Housing (1976) 1 NMLR 329 at 333; (1976) 1 All NLR (Pt. 1) 276 at 283 and Aluminium Manufacturing Co. Ltd. v. Nigerian Ports Authority (1987) 1 NWLR (PI.51) 475 at 489. In the appellants Reply Brief, it was submitted that the decision in American International Insurance Co. Ltd. v. Ceekay Traders Ltd. (supra) upon which heavy reliance was placed by the respondent had since been overruled by the Supreme Court in the case of Savannah Bank of Nigeria Ltd. v. Pan Atlantic Shipping and Transport Agencies Ltd. & Anor. (1987).1 NWLR (Pt.49) 212 at 265.

On the respondents alternative proposal that if the appeal succeeds on the issue of jurisdiction, then the case should be sent to the Federal High Court with an order to transfer the case to Oyo State High Court, the appellant contends that the proper order to make is to strike out the action. I should point out that it would serve no useful purpose for me to reopen and dwell on the civil jurisdiction of the Federal High Court as contained in the Briefs of Argument filed in this appeal because the Supreme Court of Nigeria had dealt with such matter in a number of cases. See Bronik Motors Ltd. v. Werna Bank Ltd. (supra); American International Insurance Co. Ltd. v. Ceekay Traders Ltd. (supra) and Eze v. The Republic (supra).

It seems to me that the jurisdiction of the Federal High Court to hear and determine a case depends on the nature of the claim before the court as revealed on the writ of summons and the Statement of Claim. See Western Steel Works Ltd. & Anor. v. Iron & Steel Workers Union of Nigeria & Anor. (1987) 1 NWLR (Pt.49) 284; Stallion Manufacturing & Marketing Co. Ltd. v. Stallion Fisheries Ltd. (1990) 6 NWLR (Pt.157) 501; Ruling by OpeAghe, J., Lagos State Judiciary in Mr. Ahmed Lame (Deputy Superintendent of Police) v. Inspector-General of Police & Ors. in Suit No.M/680/89 delivered on Friday, July 12, 1990 and reported in The Guardian Newspaper, Wednesday, November 14, 1990 at page 19.

In this connection, I reproduce the claim filed at the Federal High Court, Ibadan Judicial Division, Holden at Ibadan as follows:- . ‘The plaintiffs claim against the defendant is as follows:- (i) The sum of N11,000.00 (Eleven thousand Naira) being the, insured value of the plaintiffs Volkswagen Santana LX Saloon Car Registration No.OY 620 MN insured comprehensively at Ibadan by the defendant in favour of the plaintiff for the period 8th November, 1985 to 7th November, 1986 for which a cover note No.036336 and later a Certificate of Insurance No. 76562 was issued to the plaintiff by the Defendant. The said vehicle was involved in a lone accident on 23rd November, 1985 on Sango/UI road, Ibadan as a result of which the vehicle was damaged beyond repairs. The defendant has since refused and has continued to refuse to pay to the plaintiff the insured sum of N11,000.00 for the said vehicle in spite of repeated demands. (ii) Payment of interest 10% per annum on the sum of N11,000.00 being sum insured from 23rd day of November, 1985 till payment of the sum insured or date of judgment in this suit whichever is earlier. (iii) The sum of N2,000.00 being out-of-pocket expenses in connection with the said accidented vehicle.

PARTICULARS (a) Towing of vehicle N120.00 (b) Transport fare to the Headquarters of the defendant at Akure N 80.00 (c) Regular Transport expenses to Mechanic workshop, business and domestic trips of the plaintiff N1,800.00 Total N3,000.00 (iv) The sum of N10.00 per day being wages for watch-day/watch night engages by the plaintiff to look after the accidented vehicle from 28th November, 1985 till defendant takes possession of date of judgment. Dated this 19th day of March, 1986 (Sgd) Plaintiffs Solicitors Owolabi Afuye & Co., 189B, Adekunle Fajuyi Street Adamasingba, IBADAN.’ It is also useful to reproduce some of the averments in the Statement of Claim as follows:- ‘2. The defendant is a limited liability company and a licensed insurance company carrying on the business of an insurer throughout Nigeria with its head office at Akure.

In particular it carries on business of an insurer at S7/338A Isale Bode, Opposite Bode Market. Molete, Ibadan. 4. Sometime in 1984 the plaintiff was granted a car loan by the University College Hospital authority with which the plaintiff purch­ased a Volkswagen Santana LX Saloon Car Registration No.OY 620 MN for N11,000.00 sometime in October, 1984. Plaintiff will rely on the purchase receipts and other relevant vehicle particulars at the trial. 5. The said vehicle was on 29th October, 1984 through the said Mr. Dada insured comprehensively with the defendant for N11,000.00 to cover the period 29th October, 1984 to 28th October, 1985 for which a sum of N814.00 was paid by the plaintiff as premium.

The plaintiff was duly issued with a certificate of insurance and was later issued with a comprehensive Insurance Policy No.IB/PM/112. The plaintiff will rely on the said comprehensive Insurance Policy at the trial of the action. 6. On or about 8th of November, 1985 the defendants agent Mr. Emmanuel Dada of Ecod Insurance Agencies gave a cover note No.036336 to the plaintiff for the period 8th November, 1985 to 7th December, 1985 while premium negotiation for the renewal of insurance cover was going on between the plaintiff and the defendant.

The previous year Insurance Certificate to cover 29th October, 1984 to 28th October, 1985 together with the said cover note of 8th November, 1985 were subsequently misplaced by the plaintiff and all efforts to locate the documents failed. 7. On or about 10th day of November. 1985 the plaintiff renewed his insurance policy by paying the sum of N732.60 to cover a Second year of insurance from 8th November, 1985 to 7th November, 1986 both dates inclusive. The defendants agent Mr. Dada to whom the premium was paid re-issued another cover No.039617 of the defendant company to replace the lost one earlier issued to the plaintiff. The plaintiff will rely on the said cover note at the trial.

The said premium was paid by N662.91 cheque and the balance by cash. 9. However on 23rd day of November, 1985 the plaintiffs vehicle was involved in a lone accident while being driven by the plaintiffs husband Alfred Babatunde Adepoju on Sango/Bodija/UI Road, Ibadan as a result of which the vehicle was damaged beyond repairs. The plaintiffs husband drove the said vehicle with the knowledge, consent and permission of the plaintiff. The plaintiff will rely on the police report as the accident was reported to the police. 10.

The plaintiff duly notified the defendant of the accident on or about 27th November, 1985 through their said agent Mr. Dada as well as direct report to the defendants head office in Akure. Plaintiffs husband made 4 trips to the Akure head office of the defendant in connection with the said accident. The plaintiff will rely on letters written by her and/or on her behalf to the defendant and their said agent Mr. Dada in connection with this accident. 11. The defendant has since refused and has continued to refuse to pay to the plaintiff the insured sum of N 11 ,000.00 for her said accidented vehicle despite repeated demands.’

It is clear to me from the writ of summons filed at the Federal High Court, Ibadan, as well as the statement of claim dated 10th April, 1986, that the case at the lower court was concerned with a contract of motor vehicle insurance or a contract of indemnity by which the assured, after a damage or loss has been suffered or incurred by her, shall as far as possible be placed in the same position as she was immediately before the loss or damage. I n other words, the insurer, such as the appellant, agree to make good to the assured, such as the respondent, the loss or damage which the latter has actually sustained under the insurance policy. See S. W. Ubani-Ukoma v. G. E. Nicol (1962) 1 All N.L.R. 105; (1962) t SCNLR 176.

It could not be said in my view, that a contract of motor vehicle insurance arises from the operation of the Companies Act (Decree) of 1968 or any other enactment regulating the operation of companies incorporated under the Companies Act, 1968, in order to confer jurisdiction under Section 7(1)(c)(i) of the Federal High Court Act, 1973. Nor do I subscribe to the view that a contract of motor vehicle insurance, such as in this appeal, falls within the provisions of the Insurance Act, 1976, which according to the Explanatory Note contain provisions specifying time limits within which motor accident claims are to be settled, prohibiting general increases in premium rates (except with the prior approval of the Government), while other provisions relate generally to the better management and regulation of insurance business in Nigeria.

I have, therefore, come to the conclusion and hold as a fact that the Federal High Court lacked jurisdiction to entertain, hear and determine a claim under a contract of motor vehicle as it purported to do in Suit No. FHC/IB/14/86 now on appeal to this court. It seems to me also that the fact that the defendant/appellant is a company registered under the Companies Act, 1968, does not mean that every cause of action in which it is involved must be heard and determined by the Federal High Court. See observation of Oputa, J.S.C. at page 305 in the case of Western Steel Works v. Iron and Steel Workers (supra).

I turn now to the subsidiary issue relating to the proper order to make in this appeal. Upon my finding that the Federal High Court lacked jurisdiction to entertain, hear and determine the plaintiff/respondents claim as formulated on the writ of summons and the statement of claim, it is my view that this court should exercise its powers under Section 16 of the Court of Appeal Act, 1976.

Accordingly, it is hereby ordered that the action in Suit No.FHC/IB/86 be transferred from the Federal High Court, Ibadan to the Chief Judge, Oyo State, High Court of Justice, Ibadan, who will assign the case for hearing and determination. In the result, this appeal is allowed but with no order as to costs.

SULU-GAMBARI, J.C.A.: I have had the privilege of reading in advance the judgment just delivered by my learned brother, Agoro, J.C.A., and I entirely agree with his decisions.

The claim as revealed by the pleadings was not based on insurance under the provisions of Insurance Act, 1976 nor does it arise from the operation of the Companys Act, 1968 but purely on contract arising from a claim for damages caused to the insured chattel which the Federal High Court is incompetent to adjudicate upon. I would also allow the appeal without awarding any costs.

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Other Citation: (1990) LCN/2405(SC)