The Honda Place Ltd. V. Globe Motor Holdings Nig. Ltd. (2005)

LAWGLOBAL HUB Lead Judgment Report

KATSINA-ALU, J.S.C.

This appeal is from the decision of the Court of Appeal, Lagos Division in appeal No. CA/L/164/99 given on 12th December, 2000. The appellant had filed a motion before the Lagos High Court whereby it sought an order dismissing the respondent’s suit on ground of res judicata and abuse of court process. The High Court dismissed the appellant’s motion. The appellant’s appeal to the Court of Appeal, Lagos Division was dismissed. The decision of the High Court was affirmed. The appellant has further appealed to this court.

In order to appreciate the submissions and arguments on behalf of the parties, I think it is desirable to state the facts of this case in detail. The facts of the case are these. The appellant was a dealer appointed by the Japanese manufacturers of Honda cars, to import and market Honda cars in Nigeria. On 2nd December, 1993, the appellant entered into a sub-dealership agreement with the respondent as a sub-dealer of Honda cars with the right to import and market 45% of cars allotted to the appellant by the Japanese manufacturer.

Afterwards, a dispute arose between the parties in the operations of the sub-dealership agreement. This led to a spate of litigations, the principal one being suit No. LD/1643/96 between the appellant as 1st plaintiff and the respondent as 1st defendant. The suit was eventually settled out of court with the “Terms of Settlement” duly signed by all the parties. The terms of settlement were embodied in and became the judgment of the court. The judgment of the court reads as follows:

“Judgment is hereby entered as per the terms of settlement filed by both parties as follows:

1. The 1st and 2nd defendants, their servants, agents and/or privies shall cease from any publication or advertisement or presentation of themselves to the public as otherwise sole or exclusive distributors or sole dealers of Honda cars in Nigeria;
2. The plaintiffs and the 1st and 2nd defendants have agreed that all advertisements will include all other authorized Honda dealers under one umbrella, each dealer to be identified by the words “Honda” + their respective locations. The words “T.H.P. Limited” shall appear in one comer in small letters in all adverts.
3. The 1st and 2nd defendants shall cease forthwith after the arrival of 106 units of Honda cars already committed to and arriving before the end of November 1996, the importation of Honda cars into Nigeria from the United States of America, the middle east or any other source and shall deal only in and participate in the sale of Honda cars imported or sold in Nigeria by Honda Motor Company Limited of Japan through the 2nd plaintiff, the sole and exclusive distributor of Honda Japan in Nigeria.
4. The 1st defendant shall purchase a backlog of 45 units of Honda cars from the plaintiffs at a price to be mutually agreed upon before ordering/importing any new Honda cars through the plaintiff and the plaintiff shall subsequently supply information, prices, polices and guidelines. On completion of the backlog, the plaintiff shall provide proforma invoices through T.H.P. Limited on request by the 1st and 2nd defendants. Payments for the said backlog shall be done as agreed by the plaintiffs and the 1st and 2nd defendants.
5. The plaintiffs and the 1st and 2nd defendants hereby agree that the sub-dealership agreement of 2nd December, 1993 is no longer operative.
6. The plaintiffs hereby re-appoint the 1st defendant as a dealer for Honda cars subject to the above conditions and in line with Honda rules, polices and guidelines and both parties shall enter into a new dealership agreement subject to the approval of Honda Motor Company of Japan.
7. The plaintiff hereby discontinue this action against 3rd, 4th and 5th defendants.
8. Parties to bear their costs.”

(Italicising supplied for emphasis)

On 23rd, September, 1997 the respondent brought an action in suit No. M/471/97 at the Lagos High Court seeking an order of the court “compelling the appellant to comply with the orders of the Honourable Court delivered on the 15th day of July, 1996 in suit No. LD/1643/96.”

The respondent also asked for N900, 000,000.00 damages.

While suit No. M/471/97 was still pending at the Lagos High Court, the respondent filed a fresh action against the appellant in suit No. ID/915/98 at the Ikeja Division of the Lagos State High Court. In that suit the respondent pleaded the sub-dealership agreement of 2nd December, 1993 and sought the following reliefs:

“i. A declaration that the memorandum of agreement dated the 3rd (sic) day of December, 1993 signed by both parties to this action remains binding and effective.

ii. A declaration that the defendant has failed to carry out or perform the obligation imposed upon it under clauses 3 (a) and (b) of the said agreement;

iii. A declaration that the aforementioned agreement dated the 3rd (sic) day of December, 1993, does not absolutely and completely prohibit the plaintiff from importing Honda motor cars from any willing supplier for resale and distribution in Nigeria;

iv. A declaration that the defendant has no right to prevent the plaintiff from importing Honda motor cars for resale and distribution in Nigeria after he (the said defendant) had repudiated or deliberately failed to implement the aforementioned agreement dated 3rd (sic) day December, 1993;

v. An order of perpetual injunction restraining the defendant, its servants and agents from preventing or doing any act or taking any action or step to prevent the plaintiff from importing into Nigeria Honda motor cars for resale and distribution in Nigeria on the alleged ground that no one in Nigeria (apart from the defendant) can lawfully import such cars into the country for resale and distribution.