Universal Properties Ltd V. Pinnacle Commercial Bank & Ors (2022)

LAWGLOBAL HUB Lead Judgment Report

JOHN INYANG OKORO, J.S.C.

This is an appeal against the judgment of the Court of Appeal Lagos Division delivered on 14th of April, 2008 wherein the lower Court dismissed in limine the appeal filed by the Appellant which was pending before the said Court for want of diligent prosecution. The Appellant’s brief was not before the Court although the Court had granted the Appellant extension of time to file the said brief. A summary of the facts leading to this appeal are as stated hereunder.

​The 1st Respondent (now under liquidation by the Nigeria deposit Insurance Corporation) as plaintiff on 14th July, 1992 commenced an action at the High Court of Lagos State against the 2nd and 3rd Respondents as 1st and 2nd Defendants respectively by a special endorsed Writ of Summons claiming the sum of N5,417,746.43 (Five million four hundred and seventeen thousand, seven hundred and forty-six naira, forty-three kobo only), interest on the said sum at 34% until judgment and thereafter until satisfied, resulting from a credit facility which it extended to the 1st Defendant and was guaranteed by the 2nd Defendant. Judgment was given in favour of the 1st Respondent but was not satisfied. The 1st Respondent, because of the inability of the 1st and 2nd Defendants (now 2nd and 3rd Respondents) to satisfy their indebtedness, applied and sold the immovable properties of the 3rd Respondent known as 12A and 12B Ladipo Oluwole Street, Lagos, titled number No. 0646.

The Appellant and 4th Respondent, upon becoming aware of the existence of the judgment including steps taken by the 1st Respondent to levy execution upon the properties of the 3rd Respondent, applied and were joined as parties to the suit. The 4th Respondent claimed it had an interest and mortgage over the property.

​Subsequent upon being joined, the Appellant applied to the trial Court for extension of time to apply to set aside the sale of their alleged properties by the 1st Respondent in the execution of the judgment against the 2nd and 3rd Respondents, an order setting aside the sale of the said properties and certificate of sale issued pursuant to the sale. The aforestated application was refused and dismissed by the learned trial Judge on 6th October, 2000. The Appellant being dissatisfied with the aforesaid ruling of the trial Court, appealed against the said decision to the Court of Appeal, Lagos Division.

At the Court of Appeal, the Appellant filed a motion on notice dated 5th June, 2002 for leave to file additional grounds of appeal, extension of time to bring in a supplementary record of appeal, an order deeming the supplementary record of appeal already compiled and served as duly filed and served, extension of time to file the Appellant’s brief of argument and an order deeming these processes as duly filed and served.

The Court of Appeal on 18th January, 2005 heard the Appellant’s motion dated 5th June, 2002 and extended the time allowed the Appellant to bring in the supplementary record, leave to file additional grounds of appeal which notice should be filed within fourteen (14) days from the date of Court order together with the Appellant’s brief of argument.

​On 25th May, 2006, the Appellant filed a motion on notice dated 22nd May, 2006 praying the lower Court for extension of time to comply with the orders made in favour of the Appellant on 18th January, 2005. When this motion on notice came up for hearing on 3rd July, 2006 the lower Court observed that the 2nd and 3rd Respondents thereat had not been served. The learned counsel for the Appellant applied to withdraw the motion which was granted by the Court below.

On 30th January, 2007, the 5th Respondent filed a motion on notice dated 25th January, 2007 urging the Court to dismiss the appeal for lack of diligent prosecution by the Appellant. The learned counsel for the Appellant filed a counter affidavit to oppose the said motion.

On 25th September, 2007, the Appellant filed an application dated 24th September, 2007 praying the Court to further extend the time within which to file additional grounds of appeal, Appellant’s brief of argument and to deem the processes filed as properly filed. The Appellant also sought to substitute the 1st Respondent with its liquidator – the Nigeria Deposit Insurance Corporation (NDIC) and also Spring Bank Plc for the 4th Respondent respectively. This motion was however not served on the 2nd 3rd and 4th respondents and was adjourned to 16th October, 2007 for hearing.

​At the hearing of the motion on 14th April, 2008, the Appellant again, applied to withdraw its motion dated 24th September, 2007, and filed on 25th September, 2007. The other parties did not object to the Appellant’s application to withdraw the said motion. The said prayer was granted by the lower Court and the motion for further extension of time was struck out.

Thereafter, the learned counsel for the 5th Respondent applied to the Court to be allowed to move the pending motion to dismiss the appeal for lack of diligent prosecution. The said motion was brought pursuant to Order 17 Rule 10 of the Court of Appeal Rules 2007. The lower Court acceded to the application of the learned counsel for the 5th Respondent. After the motion was successfully moved, the Court below granted the prayer by invoking the provision of Order 17 Rule 10 of the Court of Appeal for want of diligent prosecution.

Dissatisfied with the decision of the Court below, the Appellant filed Notice of Appeal on 12th May, 2008. The said Notice of Appeal has three grounds out of which the Appellant has distilled two issues for determination to wit:-

1. Whether in the circumstances of the appeal, the decision contained in the ruling of the Court of Appeal dismissing the appeal for want of prosecution was properly made under Order 17 Rule 10 of the Court of Appeal Rules, 2007,
2. Whether in the circumstances of the appeal, the dismissal of the appeal in limine by the Court of Appeal did not amount to denial of fair hearing to the Appellant.

For the 1st Respondent, its learned counsel, Ogechi Ogbonna Esq, who settled its brief, distilled two similar issues but couched differently as follows:-

1. Whether the Honourable Court of Appeal was right to dismiss the appeal filed by the Appellant for lack of diligent prosecution,
2. Whether the Appellant was granted an opportunity to be fairly heard by the Court of Appeal in the determination of Appeal No. CA/C/394/2011 filed by the Appellant.

The 2nd Respondent’s counsel, Lawrence C. Ohineme, Esq also distilled two issues thus:-

1. Whether the dismissal of the Appellant’s appeal by the Court below on ground of indolent based on Order 17 Rule 10 of the Court of Appeal Rules, 2007 was proper.
2. Whether the Court below denied the Appellant fair hearing in the dismissal of its appeal,

​Mr. Godson C. Ugochukwu, learned counsel for 3rd Respondent also formulated two issues to wit:-

1. Whether the lower Court was right to dismiss the Appellant’s appeal for want of diligent prosecution in line with Order 17 Rule 10 of the Court of Appeal Rules, 2007.
2. Whether the Appellant was not afforded fair hearing by the lower Court before the appeal was dismissed.

Learned counsel for the 4th Respondent, Chinasa Unaegbunam Esq, married the two issues and rendered them as follows:-

“Whether the Court below was right in its decision to dismiss the Appellant’s appeal based on Order 17 Rule 10 of the Court of Appeal Rules, 2007 was proper (sic) given the circumstances of the case including the Appellant’s right to fair hearing.”

In respect of the 5th Respondent, his counsel, Dr. George O. A. Ogunyomi, who settled the brief, adopted Appellant’s first issue and added his own version of issue two as follows:-

“Whether the Court of Appeal in dismissing the appellant’s appeal after the Appellant withdrew its pending application for regularization of its brief of argument and in the absence of any appellant’s brief of argument, did not accord the parties fair hearing.”

​Before taking a closer look at the issues submitted for the determination of this appeal, I propose to entertain the preliminary objection raised by the 1st Respondent against the hearing of this appeal. Notice of preliminary objection was filed on 4th January, 2022 and same is argued on pages 5-8 of the 1st Respondent’s brief filed on 30th October, 2020 but deemed properly filed on 17th November, 2020.

Learned counsel for the Appellant C. O. Ekezie, Esq has filed argument in opposition to the 1st Respondent’s preliminary objection. It was filed on 17th November, 2020. And upon receipt of Appellant’s reply brief, the 1st Respondent filed reply on points of law (on the preliminary objection) on 19th November, 2020.

PRELIMINARY OBJECTION:-

The kernel of the 1st Respondent’s objection to the hearing of this appeal, is that this Court lacks the jurisdiction to hear this appeal commenced by a Notice of Appeal dated 12th May, 2008 and filed same date. The objection, according to learned counsel for the 1st Respondent is based upon the failure of the Appellant to seek for and obtain leave of the Court in line with extant provisions of Section 417 of the Companies and Allied Matters Act, 1990 before filing the appeal against the decision of the Court of Appeal delivered on 14th April, 2008 to dismiss the appeal filed by the Appellant to the Court below. That the said Companies and Allied Matters Act, 1990 was the operative law at the time this appeal was filed.

Learned counsel submitted that the Notice of Appeal filed to commence this appeal is incompetent, being a process filed to commence action against a company undergoing liquidation at the material time but without the leave of this Court first sought and obtained.

​It was further contended that the health status of the 1st Respondent including the fact that the 1st Respondent is under liquidation was fully known to the Appellant, which, prior to the dismissal of the appeal by the Court below, had admitted that the 1st Respondent was since under liquidation in paragraph 3(a) of the affidavit in support of the motion on notice dated 24th September, 2007 and filed on 25th September, 2007 seeking for leave of the Court below to substitute the 1st Respondent with its liquidator, the Nigeria Deposit Insurance Corporation, referring to page 412 of the record of appeal. He submits that Section 650 of CAMA defines Court to include Court of Appeal and the Supreme Court. It is his view that the Appellant ought not to have commenced this appeal without leave first sought and obtained, relying on Onwuchekwa v NDIC (2002) 5 NWLR (pt. 760) 371.

In conclusion, learned counsel submitted that the Appellant failed to commence this appeal by due process of law and failed to fulfill a mandatory statutory condition precedent before filing this appeal. Referring to the case of Madukolu v Nkemdilim (1962) 2 SCNLR 341, he submitted that this Court lacks the jurisdiction to entertain this appeal and that it should be struck out.

​Responding, the learned counsel for the Appellant in their reply brief submitted that the preliminary objection is misconceived and unmeritorious as the said provision of CAMA under which the 1st Respondent brought this objection is inapplicable to the facts of this appeal. He submitted that as shown in paragraph 2 of the 1st Respondent’s brief of argument under “facts of the matter”, it was the 1st Respondent that commenced the proceedings that gave rise to this appeal and secondly, the matter was commenced at the High Court of Lagos State and not the Federal High Court. He relies on the case of Onwuchekwa v NDIC (supra) also relied upon by the 1st Respondent and the case of Agro Allied Development Ent. Ltd v Northern Reefer & 2 Ors (2009) 5 – 6 SC (pt.1) 110 at 123.

Learned counsel further submitted that Section 417 of CAMA relevant to this issue applies only to matters commenced before the Federal High Court, as “the Court” referred to in that provision is the Federal High Court, not a State High Court.

He contended further that the fact that the Appellant filed Notice of Appeal against the decision of the lower Court in the matter commenced at the trial Court by the 1st Respondent, has not detracted from the fact that this suit was commenced by the 1st Respondent since an appeal is a continuation of an action and not the commencement of a fresh action.

Learned counsel for 1st Respondent filed a reply on points of law. Firstly, he submitted that by Section 650 of CAMA, the Court of Appeal and Supreme Court are part of the Courts envisaged in Section 417 of the Act. Secondly, that an appeal being a continuation of hearing does not remove the duty and burden imposed upon the Appellant by law to comply with mandatory requirements of obtaining leave where the concerned company goes into liquidation as stipulated in Section 417 of CAMA. He urged the Court to hold that part of the judgment of Onnoghen, JSC (as he then was) in Agro Allied Development Ent Ltd v Northern Reefer & 2 Ors (supra) was at most obiter dicta which does not change the position of this Court inOnwuchekwa v NDIC (supra). He urged the Court to uphold the preliminary objection.

It is not in doubt that a notice of appeal, being an originating process in an appeal process, is a very important document. It is the foundation of an appeal. If it is defective, the appellate Court has no choice than to strike it out on the ground that it is incompetent. I need to emphasis that the question of whether or not a proper notice of appeal has been filed in Court is a question which touches on the jurisdiction of the appellate Court. If no proper Notice has been filed, then there is no appeal for the Court to entertain. See FBN PLC v TSA Industries Ltd (2011) 15 NWLR (pt.1216) 247, Anadi v Okoti (1972) 7 SC page 57, Central Bank of Nigeria v Okojie (2004) 10 NWLR (pt.882) 488, Olanrewaju v BON Ltd (1994) 8 NWLR (pt.364) 622, Abubakar v Waziri (2008) 14 NWLR (pt.1108) 507.

In the instant appeal, the contention of the 1st Respondent is that the Notice of Appeal dated and filed by the Appellant on 12th May, 2008 is incompetent, being a process filed to commence action against a company undergoing liquidation at the material time but without the leave of this Court being first sought and obtained vide Section 417 of the Companies and Allied Matters Act (CAMA) 1990 being the Act in force at the time of filing this appeal. Let me quickly state that Section 417 of Companies and Allied Matters Act, 1990 is in all fours with Section 580 of Companies and Allied Matters Act, 2020.

Now Section 417 of Companies and Allied Matters Act, 1990 provides:-

“…if a winding up order is made or a provisional liquidator is appointed, no action or proceedings shall be proceeded with against the company except by leave of the Court.”

​The above provision is very clear and unambiguous. It means clearly that if a winding up order is made or a provisional liquidator is appointed, no action or proceedings shall be proceeded with against the company undergoing liquidation. The intendment of the said provision is not to stop an aggrieved party from proceeding against the company which has been issued a winding up order or which a provisional liquidator has been appointed, but that leave of Court must be sought and obtained before commencing the action or proceedings.

As was pointed out by the learned counsel for the 1st Respondent, the health status of the 1st Respondent including the fact that the 1st Respondent was under liquidation was fully known to the Appellant, which prior to the dismissal of the appeal by the Court below had admitted that the 1st Respondent was since under liquidation in paragraph 3(a) of the affidavit in support of the Motion on Notice dated 24th September, 2007 and filed on 25th September, 2007 seeking for leave to substitute the 1st Respondent with its liquidator – the Nigeria Deposit Insurance Corporation as found in page 412 of the record which states:-

“3(a) The 1st Respondent, Pinnacle Commercial Bank Limited has since been under liquidation by the Nigerian Deposit Insurance corporation whose head office is at Mamman Kontagora House, 23A Marina Lagos. Further, that all the assets and liabilities of the said 1st Respondent have been taken over by the said NDIC ”

The above position has not been denied by the Appellant. And in any case, the record of this Court and/or any other Court is binding on the Court and the parties. It is trite that a crucial fact which is admitted does not require further proof as no person would admit a fact which could work against his interest unless it is true. See Sapo v Sunmonu (2010) 11 NWLR (pt.1205) 374, Adeusi v Adebayo (2012) 3 NWLR (pt,1288) 534 at 558 paragraph B, INEC v Oshiomole (2009) 4 NWLR (pt.132) 607 at 662. It is my well considered view that as at the time the Appellant filed its notice of appeal in this case, it knew that the 1st Respondent was under liquidation and that a liquidator i.e. NDIC had been appointed.

My Lords, the Appellant does not say it did not know that the 1st Respondent had fallen into liquidation and that a liquidator had been appointed. All it is saying is that the Supreme Court is not one of the Courts referred to in Section 417 of the CAMA, 1990. This, with due respect, is not correct. Section 650 of CAMA, 1990 which is retained in Section 868 of CAMA, 2020, defines “Court” or “the Court” as used in relation to a company under liquidation as ‘the Federal High Court, and to the extent to which application may be made to it as a Court includes the Court of Appeal and the Supreme Court of Nigeria.” Thus the argument of learned counsel for the Appellant that “Court” as used in Section 417 of CAMA, 1990 does not include the Court of Appeal and the Supreme Court, does not fly at all. It is my well considered opinion that the requirement of obtaining leave stipulated by Section 417 of CAMA, 1990 includes obtaining leave of the appropriate appellate Court to appeal against any decision made in any suit in which a company under liquidation is a party since Section 650 of CAMA defines Courts to include the Court of Appeal and the Supreme Court.

Luckily for us, this is not the first time this Section of CAMA is to be considered by this Court. In Alex O. Onwuchekwa v Nigeria Deposit Insurance Corporation (Liquidator of Co-operative and Commerce Bank Nig. Ltd) (2002) 5 NWLR (pt760) 317, this Court held that by virtue of the provision of Section 417 of the Companies and Allied Matters Act, 1990, if a winding up order is made or a provisional liquidator is appointed, no action or proceedings shall be proceeded with against the company except by leave of the Court. It added that what that section prohibits is action against the company without leave of Court and not the company proceeding against another person. This decision demolishes the Appellant’s argument that after all, it was the 1st Respondent that commenced the proceedings that gave rise to this appeal. See also Agro Allied Development Ent. Ltd v Northern Reefer & 2 ors (2009) 5-6 SC (pt.1) 110.

Learned counsel for the Appellant argued that because an appeal is a continuation of hearing of a case and as such, there was no need to obtain leave. This is, with respect, not tenable. It is my view that an appeal being a continuation of hearing does not remove the duty and burden imposed on the Appellant by law to comply with mandatory requirement of obtaining leave where the concerned company goes into liquidation as stipulated in Section 417 of CAMA, 1990.

​On the whole, I agree entirely with the learned counsel for the 1st Respondent that liquidation is a special circumstance which affects the concerned company and triggers the provision of Section 417 of CAMA, 1990, now Section 580 of CAMA, 2020 which makes it mandatory (by the use of the word “shall”) for leave of either the Court of Appeal or this Court to be sought and obtained by the Appellant for there to be a valid appeal. It is trite that where the law has stipulated in a mandatory provision applicable in specified circumstances, same must be given effect to. It is usually referred to as a condition precedent. This Court has properly elucidated the expression “condition precedent” in J. S Atolagbe & Ors v Alhaji Muhammadu Awuni & Ors (1997) 9 NWLR (pt.522) 537 at 565 per Uwais CJN thus:-

“Condition is a provision which makes the existence of a right dependent on the happening of an event; the right is then additional as opposed to an absolute right A true condition where the event on which the existence of the right depends is in the future uncertain, A “Condition Precedent” is one that delays the vesting of a right until the happening of an event”

​By the same token in this case in hand, the seeking and obtaining of leave is the condition precedent that would first take place before the vesting of the right to approach this Court. The condition must be met before the Appellant’s right to ventilate in this Court would inure. See Attorney General of Kwara State & Anor v Alhaji Saka Adeyemo & Ors (2016) LPELR-41147 (SC), Drexel Energy & Natural Resources Ltd & Ors v Trans International Bank Ltd & Ors (2008) 18 NWLR (pt,1119) 388, Capt, Amadi v NNPC (2000) 10 NWLR (pt,674) 76, Niger care Development Company Limited v Adamawa State Water Board & Ors (2008) 8 NWLR (pt.1093) 498.

Finally, the Appellant, having failed to obtain leave as prescribed in Section 417 of the CAMA, 1990 before filing this appeal, the said notice of appeal is incompetent and liable to be struck out. Once the law has stipulated the procedure for achieving an end, same has to be complied with. A litigant who fails to observe such provision cannot activate the jurisdiction of this Court as you cannot put something on nothing and expect it to stand. It will certainly and surely collapse. SeeMacfoy v U.A.C. (1961) 3 All ER 1169, Madukolu v Nkemdilim (1962) 2 SCNLR 341. This appeal commenced without the leave of this Court is null and void. The preliminary objection to the hearing of this appeal is thus upheld. Accordingly, this appeal is hereby struck out.

I make no order as to costs.

Appeal struck out.

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SC.332/2008