Seven Up Bottling Co. Ltd. V Abiola And Sons Bottling Co. Ltd (2001)

LAWGLOBAL HUB Lead Judgment Report

SYLVESTER UMARU ONU, JSC. 

This is an appeal against the final decision of the Court of Appeal (hereinafter referred to as the court below) arising from an interlocutory decision of Gbadeyan, J. of the High Court of Justice of Kwara State holden at Ilorin, wherein the preliminary objection of the Defendants, herein Appellants, to the competence of the suit as well as jurisdiction of the trial court to entertain same, was dismissed.

The background facts of the case that culminated in the appeal may be briefly stated as follows:

In the case which began as an off-shoot of another action No. KWS/215/88 herein on appeal and whose history is tortuous, the Plaintiff now Respondent, obtained a loan from the 3rd Defendant/Appellant, a Banking institution. Although the loan was still outstanding and the Respondent claimed it was not due for repayment, the 3rd Defendant/Appellant proceeded to appoint the 2nd Defendant/Appellant as the Receiver/Manager of the resulting debenture. Following its (Respondent’s) failure to pay up, it in the meantime filed an action in the Kwara State High Court in Suit No. KWS/215/88, to contest the legality of the debenture to stem the acts of the 2nd Defendant/Appellant that began selling its factory etc. to the 1st Defendant/Appellant in purported exercise of its powers under the mortgage debenture between the parties. It (respondent) thereupon obtained interim Order of injunction restraining the Defendants/Appellants from selling these properties and/or the factory, pending the determination of the motion on notice for the substantive order of interlocutory injunction. While the interim order was still subsisting and notwithstanding the said Order, the 2nd Defendant/Appellant engaged in selling the Respondent’s properties such as vehicles and plants. It thereupon engaged in bringing committal proceedings for contempt against the Defendants/Appellants, which finally failed in the Court of Appeal in November, 1990.

This led to the inception of the present action in the Kwara State High Court (Coram: Gbadeyan, J.) wherein the Plaintiff/Respondent claimed damages for its properties traceable to the hands of the Receiver/Manager who allegedly sold them as Receiver/Manager in violation of the interim order of injunction made. By paragraph 19 of the Respondent’s Statement of Claim, it is averred thus:

’19 WHEREOF the Plaintiff claims from the Defendants jointly and/or severally as follows:

1. A Declaration that the removal, sale and/or disposal of the said 44 vehicles and/or plants by the Defendants in disregard of the Court Order restraining same is illegal, null and void;
2. A sum of N18,031,980.00 being the market value of its vehicles and/or plants illegally sold by the defendants as at the time of sale;
3. General Damages of N132,919,181.00 being the current cost of purchase of such vehicles and/or plants illegally sold by the Defendants;
4. ALTERNATIVELY: Restitution of the Said 44 vehicles and/or plants in the working conditions they were before the Defendant illegally sold them.’

Pleadings were ordered, filed and exchanged in the new action. The Appellants in their joint statement of defence pleaded in part thus:

’17 The defendants shall by way of preliminary objection contend that the Suit is incompetent in that conditions precedent to the exercise of the jurisdiction of the court has not been fulfilled.

18. The defendants shall also contend that the suit is an abuse of the Court’s process as the cause of action in this suit is substantially the same and/or can be subsumed in Suit No. KWS/215/88 Abiola & Sons Bottling Co. Ltd. v. 7up Bottling Company Ltd. & Ors. and Suit No. KWS/122/91 Abiola & Sons Bottling Co. Ltd. & Anor. v. First City Merchant Bank Ltd & 2 Ors. all of which are still pending.

19.The Defendants shall further contend that this Honourable Court has no jurisdiction to try this case.’

Subsequent to the filing of their Statement of Defence, the Appellants brought an application before the Court for:

‘1. AN ORDER setting down for hearing and disposal before trial the issue of law concerning the jurisdiction of the court as raised in paragraphs 17,18 and 19 of the Statement of Defence.

2. AN ORDER permitting argument of the issue of law raised in paragraphs 17, 18 and 19 of the Statement of Defence to be argued on this motion, to wit:

(a) The condition precedent to exercise of the jurisdiction of the Court has not been fulfilled, that is to say, leave of the Court to sue the Receiver/Manager in respect of the property in Receivership was not obtained before the issuance and service of the Writ of Summons.

(b) That the issue of the validity, legality and correctness/or otherwise of the appointment of the 2nd defendant as a Receiver/Manager pleaded in paragraphs 2 and 3 of the Statement of Claim are the same cause of action in Suit No. KWS/215/88, Abiola & Sons Bottling Co. Ltd. v. First City Merchant Bank Ltd.

(c) The High Court of Justice of Kwara State has no jurisdiction to hear and determine the plaintiff’s claim which concerns and relates to the management of the properties of the plaintiff in receivership by the Receiver/Manager.’