United Bank for Africa & Anor V. Immarches (Nigeria) Ltd. (2003)
LawGlobal-Hub Lead Judgment Report
DAVID ADEDOYIN ADENIJI, J.C.A.
This is an appeal brought by the defendants/appellants against the decision of Ichoku, C. J., sitting in the Port Harcourt Division of the High Court of Rivers State, on 25th June, 1998, in suit No. PHC/927/97. The court gave judgment for the plaintiff in the sum of N1,504,833.00 with N1,500.00 as costs against the two defendants/appellants.
The defendants/appellants being dissatisfied with the court’s judgment appealed to this court and filed two grounds of appeal in the process to wit:
“(a) The learned trial Judge erred in law and misdirected himself, when he entered judgment against the defendants/ appellants on the undefended list on a day fixed for motion for extension of time brought by the defendants/ appellants without fixing another day for hearing of the matter brought under the undefended list by the plaintiff/ respondent and thereby, occasioned a miscarriage of justice.
(ii)(a) The learned trial Judge erred in law and misdirected himself when he failed to consider the merit of the defence raised in the notice of intention to defend filed by the defendants/appellants and proceeded to enter judgment, against the defendants/appellants in the sum of N1,504,833 and cost of N1,500 in favour of the plaintiff/ respondent.”
The appellants formulated 2 issues for determination and adopted same at the hearing of the appeal. The two issues are:
Issues for determination
“3.01 Whether it was proper for the learned trial Chief Judge to have delivered judgment against the appellants on a day fixed for motion of extension of time brought by the defendants/appellants without fixing another date for hearing of the matter brought under the undefended list?
3.02 Whether the learned Chief Judge gave the appellants a fair hearing when he ignored the merit of the defence raised by the appellants in the affidavit supporting the notice of intention to defend and proceeded to enter judgment against the defendants/appellants in the matter brought under the undefended list?”
On his part, the plaintiff/respondent’s counsel also formulated two issues for determination and adopted the two at the hearing of the appeal to wit:
Issues for determination
“1. Whether the learned trial Chief Judge was right in the procedure, he adopted by proceeding to Judgment after granting an application on a motion extending time for the appellants to file and serve their notice of intention to defend together with the affidavit, supporting the notice of intention to defend in a matter placed under the undefended list.
- Whether on the facts of this case, it could be said that the appellants were denied fair hearing by the lower courts for holding that the affidavit supporting the notice of intention to defend discloses no defence on the merit.”
The facts of this case are that the 1st defendant/appellant’s bank wrote on 20/9/96 to the plaintiff/respondent’s company, a hotel requesting it to reserve a double-room accommodation for the 2nd defendant/appellant, a member of its staff, till further notice. That was done and the 2nd defendant/appellant moved in. He stayed there till 17/10/96, when he checked out. According to him, he gave the respondent notice of his intention to check out and actually checked out on 17/10/96.
The respondent was, however, of the view that with the words, “till further notice”, contained in the letter of request, the contract would continue till it was formally terminated (in writing). In reply, the appellants wrote on 25/10/98 telling the respondent that the 2nd appellant was at liberty to check out any time he wanted and that it was not in the practice of the company to formally write to terminate a contract for lodging.
The respondent ignored the letter and went on calculating the days, even though the lodger had since left. The 1st appellant had in the meantime paid the sum of N190,152,00, which represented the amount due on the room as at 17/10/96. By its letter of 18/6/97 through its counsel, the plaintiff/respondent demanded payment of N2,050.032.00 being the total amount the lodger was supposed to pay according to the calculation of the respondent as at the date of the letter. The sum of N190,152.00 earlier paid by the 1st appellant was deducted from the overall sum said to be due and for the balance the lower court gave judgment for the plaintiff/respondent.
In the course of the proceedings, the respondent got an order, on 7/7/97 for the suit to be placed on the undefended list. The claim was framed as follows:
“1. The sum of N2,050,932.00 (Two million, fifty thousand, nine hundred and thirty-two Naira only) being and representing an outstanding hotel bill so far, for the period of 18/ 10/96 – 18/6/97, after the payment of N190,152.00 (One hundred and ninety thousand, one hundred and fifty-two Naira only), to the plaintiff, and for which the defendants have refused, neglected and failed to pay to the plaintiff inspite of repeated demands.
- Interest on N2,050,932.00 at the current bank rate of 10% per annum from the 1st day of July, 1997, until judgment is delivered and thereafter, at the same until the satisfaction of judgment.”
After being served, the appellants filed a motion for extension of time to file notice to defend the action. The application was not opposed and was granted by the learned Chief Judge on 25/6/98.
On that same day, counsel for the plaintiff/respondent asked for judgment for the plaintiff on the ground, as he put it, that no defence on merit has been disclosed because the contract was documents and the documentary were already before the court. The appellant’s counsel, one Akintoye, however, replied that some defence on merit was disclosed and the appellants should be allowed to defend the suit.
The court there and then, wrote another ruling, saying there was no defence disclosed on merit. The court based its decision on the letters of request for accommodation particularly noting the words, “until further notice.” The court went on to give judgment to the plaintiff/respondent in the case but rejected the claim for interest.
Against the decision, the appellants filed two grounds of appeal supra and formulated two issues. Ground one, was on whether or not it was proper for the Judge to have gone on to give judgment against the appellant on a day the appellants’ motion for extension of time to file their notice of motion to defend the suit came up. According to the appellants, that was improper going by Order 23 rule 3(i) of the High Court Rules applicable to Rivers State.
Counsel cited the cases of Olubusola Stores v Standard Bank of Nigeria Ltd. 5 University of Ife Law Report (Pt. 1) 27 at 30 (1975) 4 SC 51; Mbadinuju & Ors. v. Chukwuma Ezuka & Ors. (1994) 8 NWLR (Pt. 364) 535 at 567 para. (a); The New Nigerian Newspapers Ltd. v. Oteh (1992) 4 NWLR (Pt. 237) 626 at 633 para. 6; Kano v. Bauchi Meat Products Co. Ltd. (1978) 9-10 BC 51.
The learned Counsel for the respondent, on his part, maintained that the court was right in determining the case in that manner on the very day, the application for extension of time was granted. He formulated the two issues supra, both being similar in their purports but different only in form due to the language used. Counsel quoted in extenso the provisions of Order 23 of the High Court of Rivers State (Civil Procedure) Rules as it related to matters on the undefended list and argued further that nothing prevents a trial Judge from considering a motion from extension of time to file notice to defend and going on to determine the matter that same day, if the court was satisfied that the affidavit filed by an applicant does not disclose any defence to the suit. That he insisted was a discretion vested in the court. That discretion counsel said, was properly used by the court in this particular case.
Counsel in that regard, cited the cases of Elizabeth Maley v. Habab (2000) 5 NWLR (Pt. 658) 651 at 666; Ahmed v. Trade Bank (Nig.) Plc. (1997) 10 NWLR (Pt. 524) 290 at 297-298 paragraphs H-A.
Counsel was of the view that it was not necessary to adjourn the matter for another day for the court to consider the affidavit supporting the notice of intention to defend, once the learned trial Judge has formed the opinion that the affidavit had not disclosed any defence on merit. To do otherwise, counsel believed would occasion delay and the purpose of the undefended list proceeding could by that be defeated. Counsel also cited the cases of Ben Thomas Hotels Ltd. v. Sebi Furniture Ltd. (supra) 529 paragraph H; Egwu v. Uniport (1995) 8 NWLR (Pt. 414) 419 at 443 paragraph H and concluded by urging this court to resolve issue No.1 in favour of the respondent.
In considering that issue, it is necessary to run through the provisions of Order 23 of the High Court of Rivers State (Civil Procedure) Rules cited by the counsel for the respondent, rule 3(1) thereof, that is,
“If the party served with the writ of summons and affidavit delivers to the Registrar, not less than five days before the day fixed for hearing, a notice in writing that he intends to defend the suit, together with an affidavit disclosing a defence on the merit, the court may give him leave to defend upon each term as the court may think just.”
(Italicising mine)
The words “five days before the day fixed for hearing” are significant in this regard. It means that a suit on the undefended list, must have a date meant for hearing of same. In this particular case, the matter was on the 7th day of July, 1997, adjourned to 24th July, 1997, for mention. See p. 12 of record. The appellants filed their motion for extension of time to file their notice of intention to defend the action on 23/7/97, to which they annexed the letter sequel to the checking out of the hotel by Chief Ademola dated 25/10/96.
The next proceeding on record is that of 25/6/98. Nothing to show what happened as between 7/7/97 and 25/6/98. There is certainly nothing on record showing that the matter has been fixed for hearing. On 25/6/98, when the matter came up however, the court gave a ruling allowing the defendants to file their notice to defend the action and wrote another ruling the same day to the effect that the defendants averments did not disclose a defence to the case.
That is the crux of the matter. Should the court determine a case on a date fixed for a motion? When is a defence disclosed? Is it a water tight defence that is absolute rebuttal of plaintiff’s claim or a defence however slight that is required? I believe these are the main issues to look into at this stage. Order 23(3)(1) cited supra talks of a date for hearing that is, the matter could not have been for mention merely (though there is nothing wrong in hearing a case on a date meant for mention, all things being equal). In this particular case, the matter was specifically adjourned for mention.
In the meantime, an interesting event occurred, that is the appellants had filed an application for extension of time to file a notice to defend the suit. That was granted, in which case the case was yet to be fixed for a date for hearing, except where due to prevailing circumstances at the particular time e.g., all parties agreeing to go on with the matter that same day etc. That is not the case here. I am of the view that under that prevailing situation at that particular time, it was more appropriate to give the defence a chance to be heard by further adjourning the matter to a latter date for hearing. I therefore, tend to agree with the counsel for the appellants that the summary manner in which the case was determined on a date meant for mention and the hearing of the appellant’s motion, was not proper. Adjourning it for another date could not have occasioned delay or injustice to either party.
On issue No.2, the counsel to the appellant, did not mince words, when he stoutly maintained that some defence had been shown. P. 21, 1.5-6. He urged the court to allow the appellants to defend the action. On his own part, the learned Counsel for the respondent had urged the court to enter judgment for the respondent in that “no defence on merit had been made out because the contract was purely documentary and the documents are before the court. See p. 21 lines 1-4.
The same counsel had argued in his brief p. 6 paras. 5-4 that adjournment in the case would cause further delay and that by the undefended list procedure once the affidavit supporting the notice of intention to defend does not disclose any defence on the merit, adjournment was unnecessary. He stressed that the affidavit in support of the notice to defend did not disclose any defence on the merit. On that issue, an indepth consideration of the nature of facts that can constitute a defence or defence on the merit is necessary. The rules talk of a defence on the merit. Does that imply a water tight impenetrable and irrebutable defence or a defence however light. To my mind it means a fact or facts indicating a defence on the face of it. The proof of such facts or rebuttal of same will be done at the next stage, that is, at the hearing proper and much will then depend on the type of evidence to be led. That line of thought is in accord with the legal principle guiding the issue of standard of proof in all civil matters which is proof on the balance of probability, as against proof beyond reasonable doubt which obtains in criminal matters.
In effect, it is my opinion that once a defence is honestly put up, no matter how light or minute no matter how easily penetrable or rebuttable, it should be given a chance to be tested at the trial proper, that is, trial under the ordinary (general) cause list. This amounts to showing in a prima facie way that the defendant has a defence of some sort. In that type of situation, it will be in the proper spirit of doing justice to both parties if the defence is allowed to be put across and made to go through the rigors of cross examination.From that angle, one needs only to see if there was any defence at all disclosed in the affidavit of the appellants. Their case is that they made the request for accommodation per their letter and this is the letter on which the claim of the plaintiff/respondent was predicated. The letter reads:
“accommodation for Chief A. A. Ademola – One double room
kindly reserve the above mentioned accommodation for our staff with effect from 21st Sept., 1996, until further notice.
Your bill(s) for accommodating him should be forwarded to us in due course. Please confirm the reservation by signing and returning to us the attached copy of this letter.
We rely on your co-operation in this regard.
Yours faithfully,
for: pao: UNITED BANK FOR AFRICA PLC.
Signed Signed
- M. K. Baik U. J. Ibanga
Manager Administration Asst. Manager
South East Region, P/H (Commercial)
South East Region, P/H
The letter speaks for itself. It shows that the reservation was made for Chief A. A. Ademola, 2nd defendant only. His name was specifically mentioned and the reservation was limited to him. This man lodged in the hotel and later left after giving notice to check out as he claimed. The sum of N190,152.00 was later paid in cheque in respect of the same named person, Chief A. A. Ademola. The covering letter was dated 7th November, 1996.
That was followed by the letter from the counsel to the plaintiff/respondent, dated 18/6/97 demanding a higher sum, claiming that the contract had continued even after Chief Ademola (2nd appellant) had checked out of the hotel. That letter was followed by the one dated 25/10/96 from 1st appellant stating that it was not the practice of the 1st appellant to write normally to check out. The staff is said normally checked out at any time.
That aspect of the case raised serious legal issue which can only be resolved by evidence in the trial proper.
In my opinion, it is one thing to have a defence and another thing to have concrete water tight defence to an action. The claim of the appellant is that, with the physical checking out of the named staff, coupled with the payment of the bill up till that date, and the subsequent letter of the bank stating that Chief Ademola was free to check out any time. The issue of termination or otherwise of the contract is live and worthy of legal determination or interpretation and cannot be decided in a summary manner as was done by the court below. I am not by that saying that the defence disclosed was enough to defeat the claim of the respondent. All I am saying in this particular instance is that, the adequacy or sufficiency of the defence put up is one to be determined at the trial proper. It was for the court to decide at the trial whether or not the said letter of 15/10/96 from the appellant actually amounted to letter of intent to terminate the contract and if it so terminated it. In other words, the interpretation to be placed on the letter and its effect on the case can only be properly determined at the trial proper, that is, after the case had been placed on the ordinary (general) cause list.
To do otherwise, would amount to a denial of fair hearing to the appellants. It particularly infringes on the principles of audi alteram partem. Having allowed the appellant’s application to file a notice to defend the suit, the court could not have gone on to determine the suit the same day in such summary fashion without affording the appellants a chance to be fully heard on their defence that the contract had been validly terminated.
I have knowingly refrained from commenting on the other aspects of the case raised in the arguments to ensure that this court does not descend into the arena at this interlocutory stage. See the case of West African Automobile & Engineering Co. Ltd. & Ors. v. Ebun Akinsote (1999) 13 NWLR (Pt. 636) 608 at 609 in which the case of Friday Akinwale v. Universal Insurance Co. Lid. (1995) 5 NWLR (Pt. 395) 364 at 372 was cited. The court said:
“A court of law should not unwittingly decide the very same matter which is yet to be dealt with in the substantive case before it at the interlocutory state.”
(b) See also Icon Ltd. (Merchant Bankers) v. F.B.M. Ltd. (1995) 6 NWLR (Pt. 401) 370 at 377.
I have therefore, decided to limit myself to the issue of improper placement or otherwise of the suit under the undefended list. I therefore, agree with the appellants’ counsel on issue No.2 that the appellant had not by the manner in which the case was decided been given fair hearing, they having been shut out in their bid to substantiate their defence.
The appeal is therefore allowed, the ruling of Ichoku, Chief Judge given on 25/6/98, in the suit PHC/927/97 is hereby, set aside. The case is remitted to the Rivers State High Court of Justice for trial by another Judge on the general cause list. There shall be N5,000.00 costs in favour of the appellants as against the respondent.
Other Citations: (2003)LCN/1342(CA)