THE SHELL PETROLEUM DEVELOPMENT COMPANY OF NIGERIA LIMITED V. SIRPI-ALUSTEEL CONSTRUCTION LIMITED (2007)

THE SHELL PETROLEUM DEVELOPMENT COMPANY OF NIGERIA LIMITED V. SIRPI-ALUSTEEL CONSTRUCTION LIMITED

(2007)LCN/2284(CA)

In The Court of Appeal of Nigeria

On Thursday, the 22nd day of March, 2007

CA/PH/239/2005

RATIO

JURISDICTION: WHETHER JURISDICTION OF THE COURT IS TO ADJUDICATE ON A MATTER PREDICATED UPON FACTS BY THE PHRASEOLOGY OF THE PLAINTIFF CLAIM

In other words, the jurisdiction of a court to adjudicate on a matter is predicated upon the facts placed before it and more importantly by the phraseology of the plaintiff’s claim. See A.-G., Federation v. Guardian Newspapers Ltd. (1999) 9 NWLR (Pt. 618) 187; Adeyemi v. Opeyori (1976) 9-10 SC 31; Abacha v. Fawehinmi (2000) 6 NWLR (Pt.660) 228 and Western Steel Works Ltd. v. Iron and Steel Workers Union (1987) 1 NWLR (Pt.49) 284. PER GALADIMA, J.C.A.

JURISDICTION: CONSTITUTIONAL POWER OF THE COURT

The Federal High Court, like the High Court of a State, is a creature of the Constitution and its jurisdiction is defined by the relevant laws. The Court below was referred to S. 251 (1)(n) of the 1999 Constitution and section 7(1) and 7(3) of the Federal High Court Act. Section 251(1)(n) of the Constitution provides that the Federal High Court shall have and exercise exclusive jurisdiction in “mines and minerals (including oil fields, oil mining, geological surveys and natural gas)”. Section 7(1)(n) of the Federal High Court Act is similarly worded as S. 251(1)(n) of the Constitution while S. 7(3) stipulates that S. 7(1)(n) shall be construed to include jurisdiction to hear and determine all issues relating to, arising from or ancillary to mines and minerals. PER GALADIMA, J.C.A.

JUSTICES

SULEIMAN GALADIMA Justice of The Court of Appeal of Nigeria

BODE RHODES- VIVOUR Justice of The Court of Appeal of Nigeria

IBRAHIM MOHAMMED MUSA SAULAWA Justice of The Court of Appeal of Nigeria

Between

THE SHELL PETROLEUM DEVELOPMENT COMPANY OF NIGERIA LIMITED Appellant(s)

AND

SIRPI-ALUSTEEL CONSTRUCTION LIMITED Respondent(s)

GALADIMA, J.C.A. (Delivering the Leading Judgment): This is an appeal against the ruling of Hon. Justice Obie Daniel Kalio of High Court of Rivers State, Port Harcourt dated 6/5/2006 in suit No. PHC/1289/2004, holding that he had no jurisdiction to hear and determine the plaintiff’s (now appellant) suit.
The appellant instituted an action in the Rivers State High Court sitting at Port Harcourt claiming against the respondent, damages for breach of contract awarded the respondent on 20/11/2001 to rehabilitate four crude oil storage tanks at Ughelli in Delta State and an injunction to restrain the respondent from interfering in any manner whatsoever with the completion of the contract by another person.
It is the appellant’s case that the respondent having been aware of the institution of the suit, they proceeded to the Federal High Court in Benin City, Edo State and filed cross-action on 7/8/2004 with an ex parte motion for an order of injunction restraining the appellant from re-awarding the contract for the rehabilitation of the four storage tanks to any other person which the said court granted on 4/10/2004.
On 15/4/2005, the respondent filed a motion to dismiss the suit or in the alternative to stay further proceedings until the conclusion of his cross-action in the Edo State High Court, Edo where it was obtained. But after listening to arguments on both sides the court struck out the suit on 6/5/2005 declining jurisdiction. Dissatisfied with the ruling, the applicant appealed to this court on two grounds.
One issue identified for determination of the court by the appellant in their brief of argument filed on 21/8/2006 reads thus:-
“Whether the court below was right in holding that it had no jurisdiction to determine the plaintiff’s suit”
In the respondent’s brief of argument filed on 28/9/2006, the only issue that arises for determination is similarly stated as follows:
“Was the court below right in holding that it lacks jurisdiction or not competent to determine the plaintiff/appellant’s suit?”
At the hearing of the appeal, respected learned counsel adopted their briefs of argument. Learned counsel for the appellant, Mr. A. N. Anyamene, SAN, submitted that where jurisdiction of court is challenged, all the court is required to consider is the plaintiff’s writ of summons and the statement of claim. In the instant case, he contended, the relief sought by the appellant is damages for breach of contract. That the statement of claim lucidly gave the cause of action, not as any act relating to or arising from or ancillary to mining operation, but as the defendant’s inability to rehabilitate storage tanks for crude oil already extracted from the bowels of the earth. It is contended that the tanks are receptacles from which crude oil is delivered to buyers. To rehabilitate a tank, he contended, is to make it serviceable for storing crude oil.
The learned senior counsel further submitted that S. 251(1)(n) of the 1999 Constitution and section 7(1) and 7(3) of the Federal High Court Act give exclusive jurisdiction to the Federal High Court in matter pertaining to mines and minerals including oil fields, oil mining, geological surveys and natural gas. That section 7(3) of the Federal High Court Act stipulates that section 7(1)(n) of the Constitution shall be construed to include jurisdiction to hear and determine all issues relating to, arising from or ancillary to mines and minerals. Learned senior counsel placed reliance on the cases of the Shell Petroleum Development Company of Nigeria Limited v. Abel Isaiah & 2 Ors. (2001) 11 NWLR (Pt. 723) 168; Onuorah v. Kaduna Refining and Petro-Chemical Co. Ltd. (2005) 6 NWLR (Pt. 921) 393 and ruling of the Federal High Court, Port Harcourt dated 20/12/2004 in suit No. FHC/PH/CS./434/2004: Suffolk Petroleum Services United v. The Shell Petroleum Development Company of Nigeria Limited.
Finally, learned senior counsel submitted that the action instituted by the appellant is outside the spirit and intendment of the statutes conferring exclusive jurisdiction on the Federal High Court and the respondent cannot be heard to say that any action of the appellant arising from, related to or connected with mines and minerals caused him any “damnum”. He urged the court to set aside the ruling of the learned trial Judge in the court below declining to hear the suit.
On his own part, learned counsel for the respondent, Yekinni Kolawole, Esq. arguing the sole issue as formulated submitted that the statement of claim of the appellant, paragraph 1 stated that the appellant awarded contract for the rehabilitation of four crude oil storage tanks at the Ughelli Quality Control Centre on certain terms and conditions thereto. It is argued that since the tanks which were to be refurbished were to store crude oil from which the oil will be stored and saved for durability before it will be distributed to customers who deal in oil refineries, then it is the Federal High Court only that has absolute power to adjudicate to the exclusion of State High Court. Reference was made to S. 7(1)(n) and 7(3) of the Federal High Court Act. Relying on the case of Shell Petroleum Development Company (Nigeria) Ltd. v. Isaiah (supra), learned counsel submitted that the rehabilitation of the appellant’s crude oil storage tanks is related to, connected with, and arising from or ancillary to mines and minerals.
It is further submitted that the cases of Felix Onuorah Kaduna Refining and Petro-Chemical Company Limited (supra) and Dr. Okoroma v. Christian Uba & Ors. (1999) 1 NWLR (Pt. 587) p. 359 at 387 section H referred to and relied upon by the appellant are not relevant, particularly that since Onuarah’s case was purely based on a contract to purchase empty tins from the respondent at an agreed amount and payment of the agreed sum was made. Reliance was further placed on the cases of Nkuma v. Anene (2002) 3 WRN 48 and Shodeinde v. T.R.TA.M.I. (2001) 44 WRN p. 25 and Baykam Ventures Ltd. v. Oceanic Bank (2005) All FWLR (Pt. 286) 648 at p. 659.
Learned counsel to the respondent, finally urged us to affirm the ruling of the learned trial Judge declining jurisdiction to entertain the suit.
Only a single issue arises in this appeal for determination, namely, whether the court below was right in holding that it had no jurisdiction to determine the plaintiff/appellant’s suit. Parties and indeed the learned trial Judge all agreed that only the plaintiff’s claim should be considered by the court to determine whether or not it has jurisdiction over a suit. In other words, the jurisdiction of a court to adjudicate on a matter is predicated upon the facts placed before it and more importantly by the phraseology of the plaintiff’s claim. See A.-G., Federation v. Guardian Newspapers Ltd. (1999) 9 NWLR (Pt. 618) 187; Adeyemi v. Opeyori (1976) 9-10 SC 31; Abacha v. Fawehinmi (2000) 6 NWLR (Pt.660) 228 and Western Steel Works Ltd. v. Iron and Steel Workers Union (1987) 1 NWLR (Pt.49) 284.
Appellant claims from the respondent the sum of $24 million for breach of contract for full rehabilitation of 4 Nos. crude storage tanks at the Ughelli Quality Control Centre in Delta State and injunction restraining the respondent from interfering in any manner whatsoever with the completion of the contract by other person. The statement of claim, to my mind, lucidly gave the cause of action. It is not as an act relating to, or arising from or ancillary to mining operation, but as the respondent’s inability to rehabilitate storage tanks for crude oil already extracted from the bowels of the earth. My understanding is that these tanks are just the receptacles from which crude oil is delivered to prospective buyers.
The obvious task before the learned trial Judge was to decide what constitutes mining and minerals and oil fields and matter relating or ancillary thereto. He was called upon to define the relevant laws that deal with the jurisdiction of the Federal High Court. The law is now trite that once it is expressly shown that the power to entertain a particular matter is only within the cognizance of the particular court, it is only that court to the exclusion of others that can hear and determine it. The Federal High Court, like the High Court of a State, is a creature of the Constitution and its jurisdiction is defined by the relevant laws. The Court below was referred to S. 251 (1)(n) of the 1999 Constitution and section 7(1) and 7(3) of the Federal High Court Act. Section 251(1)(n) of the Constitution provides that the Federal High Court shall have and exercise exclusive jurisdiction in “mines and minerals (including oil fields, oil mining, geological surveys and natural gas)”. Section 7(1)(n) of the Federal High Court Act is similarly worded as S. 251(1)(n) of the Constitution while S. 7(3) stipulates that S. 7(1)(n) shall be construed to include jurisdiction to hear and determine all issues relating to, arising from or ancillary to mines and minerals. What therefore constitutes mining and minerals and oil fields and matters relating thereto. The court below was referred to the case of The Shell Petroleum Development Company (Nigeria) Limited (supra) for guide. The court relied on the dictum of Ogwuegbu, JSC in his contributory judgment. But for the interpretation of section 230(1)(a) of Decree No. 107 1993 which is pari materia with S. 251(1)(n) of the 1999 Constitution, the material facts of the case are not the same with the instant case. His Lordship’s opinion is not different from the lead judgment of Uthman Mohammed, JSC. He stated at page 179 para. D of the report as follows:-
“I think it cannot be disputed if I say that installation of pipelines, producing, treating and transmitting of crude oil to the storage tanks is part of Petroleum Mining Operations. Therefore if an incident happens during the transmission of petroleum to the storage tanks it can be explained as having arisen from or connected with or pertaining to mines and minerals including oil fields and oil mining. I therefore agree that the subject matter of the respondent’s claim falls within the exclusive jurisdiction of the Federal High Court as is provided under section 230(1)(a) of Constitution (Suspension and Modification) Decree No. 107.”
This court has held similar opinions concerning claims pertaining to oil spillage in Barry and 2 Ors. v. Obi Eric and 3 Ors. (1998) 8 NWLR (Pt. 562) 404 at 416 and The Shell Petroleum Development Company of Nigeria Limited v. Otelemaba Maxon and Ors. (2001) 9 NWLR (Pt. 719) 541.
Learned counsel for the respondent argued that rehabilitation of the appellant’s crude oil storage tanks is related and in connection with, arising from or ancillary to mines and minerals; since minerals according to literary meaning connotes crude oil and gas. He further submitted that transmission of crude oil cannot be complete unless its destination is at the end of the chain which begins with exploration and that storage tanks and their rehabilitation form an integral part of a crude oil mining operation. Relying on Isaiah’s case (supra), learned counsel for the respondent hinged his submission on the meaning given by the court of the verbs “connected” and “pertain”. The court relying on the definition in Black’s Law Dictionary of the two verbs agreed that the verb “connected” means “joined”, “united by function”, by an intervening substance or medium, by dependence or relation or by order in a series”. Whereas the verb “pertain” is defined in Longman’s Dictionary to mean to belong or have connection with (something).
I made further research on the meaning of these two words. The English word “connect” derives from Latin words “connectere-connexum”, meaning “to tie” or “fasten together”, to establish a relationship between”, “to associate”. The word “pertain” derives from the Latin worlds “per” and “tenere”. Hence “pertenere-pertinui” which means “to belong, to relate with or “to belong as a part of accessory.”
Once this relationship of being “connected with” or “pertaining to” is established on the facts, the matter falls within the embrace of the constitution and the Federal High Court shall have exclusive jurisdiction in the matter. See Barry v. Eric (supra). In the instant case, the subject matter of litigation in the con of the words defined above shall be something which “belongs to” or “related to”, something which belongs as a part or accessory or has reference to mines and minerals including oil fields, oil mining, geological. In order to be pertaining to section 251 (1)(n) of the 1999 Constitution.
It is evident from the exposition made by Uthman Mohammed, JSC in Isaiah’s case (supra) and from those painstaking definitions I have made above, the contract entered by the appellant with the respondent did not involve its doing anything to or with crude oil stored in tanks. If anything the storage tanks must be empty of crude oil before the respondent can execute the contract. In the case of Felix Onuorah v. Kaduna Refining and Petro-Chemical Co. Ltd. (supra), the suit originated in High Court of Kaduna State for the specific performance of a contract to supply specific number of 18-litre empty tins for carrying petroleum products. An objection to jurisdiction by the company on the ground that it was suable only in the Federal High Court for being a Federal Agency was rejected all the way to the Supreme Court on the ground that the suit related to a breach of contract simpliciter which is actionable in the State High Court.
It must always be borne in mind that the fact that a party to a suit is a Federal Government Agency does not place it under the exclusive jurisdiction of the Federal High Court. So that the fact that a party is an oil mining company does not mean that actions in respect of commercial contracts in which it is a party are only suable in the Federal High Court. See Dr. Okoroma v. Christian Uba and Ors. The Federal High Court does not have exclusive jurisdiction in all matters involving the Federal Government or any of its agencies. In the instant case, the action of the trial court striking out the appellant’s case for want of jurisdiction is not tenable as there is no provision in the 1999 Constitution or the Federal High Court Act conferring exclusive jurisdiction on the Federal High Court to entertain action of this nature, on simple breach of contract. From all the above reasons, the appeal therefore succeeds. I must set aside the ruling of the trial court declining to hear the appellant’s suit. Accordingly, the suit is remitted to the Chief Judge for assignment to another Judge for expeditious trial. No order is made as to costs.

RHODES- VIVOUR, J.C.A.: I have read in draft the judgment just delivered by my learned brother, Galadima, JCA, and I agree with his reasoning and conclusions.
The appellant/plaintiff sued the respondent/defendant on a writ of summons, accompanied by statement of claim. The claim reads:
The plaintiff claims from the defendant $40 million for breach of contract for the full rehabilitation of 4 Nos. crude storage tanks at the Ughelli Quality Control Centre in Delta State and an injunction restraining the defendant from interfering in any manner whatsoever with the completion of the contract by other person.
Hon. Justice Obie Daniel-Kalio sitting in the High Court of Rivers State, Port Harcourt Division held that he had no jurisdiction to hear the case. In declining jurisdiction His Lordship said:
“It is my conclusion that on the authority of SPDC v. Isaiah (supra) this matter is within the exclusive jurisdiction of the Federal High Court…”
Jurisdiction means the authority which resides in a court to decide matters argued before it. It is threshold, very important and it can be raised at any stage of the proceeding and even on appeal for the first time. Once raised, it must be quickly determined as a challenge to jurisdiction touches the competence of the trial court to hear and determine a case.
See: Madukolu v. Nkemdilim (1962) 1 All NLR (Pt. 4) 587; (1962) 2 SCNLR 341
Governor of Gongola State v. Tukur (I989) 4 NWLR (Pt. 111) 592.
It is very well settled that the plaintiff’s claim determines jurisdiction.
See: A.-G., Kwara State v. Warah (1995) 7 NWLR (Pt. 405) 120.
Anigboro v. Sea Trucks (Nig.) Ltd. (1995) 6 NWLR (Pt. 399) 35.
Onuorah v. Okeke (2005) 10 NWLR (Pt. 932) 40.
That is to say the court is to diligently examine the writ of summons and the statement of claim to see what the cause of action is, and the claim.
In the S.P.D.C. v. Isaiah (2001) 5 SC (Pt. 11) p. 1; (2001) 11
NWLR (Pt. 723) 168 relied on by the learned trial Judge as denying him jurisdiction, the facts were as follows:
In July 1988, a tree fell on the appellants’ oil pipeline and indented it, thereby obstructing the free flow of crude oil. The oil pipeline was owned and controlled by the appellant and ran across the respondents swampland and surrounding farmlands. The appellant engaged the services of a contractor to repair the dented pipeline. In the course of the repairs crude oil freely spilled onto the respondent’s swampland. The spillage quickly spread over the respondents communally owned Miniaba swampland and polluted the surrounding farmlands, streams and fishponds.
The plaintiffs who were the respondents in the appeal sued for N22m compensation, for damages for negligence. The case was heard in the High Court, Rivers State. N22 was awarded to the respondent for damages etc. The judgment was affirmed by the Court of Appeal, Port Harcourt Division.
The main issue on appeal to the Supreme Court was whether the Court of Appeal was right in holding that the High Court had jurisdiction to try the case. In a unanimous decision, the Supreme Court held that the courts below were wrong as only the Federal High Court has jurisdiction to hear matters pertaining to mines minerals, including oil fields, oil mining, geological survey and natural gas. It is clear the cause of action arose from oil spillage.
In this case, the appellant awarded the respondent a contract to rehabilitate four crude oil storage tanks at Ughelli in Delta State. According to the appellant, the respondent failed to rehabilitate as agreed, and so the appellant sues for damages for breach of contract. In my respectful view, the statement of claim reveals a clear case of breach of contract, and such an action or cause of action is actionable in the High Court and not in the Federal High Court.
For this and the much fuller reasoning in the leading judgment, this appeal succeeds. The suit is hereby remitted to the Chief Judge of the High Court of Rivers State for assignment to another Judge of that jurisdiction for trial.

SAULAWA, J.C.A. (Dissenting): This is an appeal against the ruling of the High Court of Rivers State holden at Port Harcourt, dated 06/5/2005 in suit No. PHC/1289/2004, coram Obie Daniel-Kalio, J. The claim of the plaintiff/appellant as per the indorsements to the writ of summons filed on 09/9/04 is contained at pages 42 and 43 of the record of appeal and is reproduced as follows for ease of reference:-
1. A declaration of court that the plaintiff’s suspension of work in respect of the execution of contract No. W-07344 was on account of community-related problems and/or financial constraints imposed upon it by the defendant’s refusal/neglect/inability to meet up with its financial obligations to it/other members of the ADAMAC GROUP, and that therefore the defendant is not entitled to a termination of the said contract.
2. A declaration of court that the plaintiff was and is entitled, by virtue of the contract agreement executed by both parties hereto to be paid fully within 45 days, all amount due on all undisputed invoices as defined in the said contract agreement dated 20th November, 2001 and that the defendant has breached this term of the contract.
3. A declaration of court that the refusal, neglect and/inability of the defendant rein to pay the plaintiff the monies due on all outstanding undisputed invoices within 45 days has affected its operational performances negatively and therefore impacted likewise on its service delivery and contractual obligations especially in relation to this contract.
4. A declaration of court that the defendant’s indebtedness to the ADAMAC GROUP of which the plaintiff is a member by being indebted to some other members of the group also impacted negatively on it’s operations as regards the contract executed between the plaintiff and the defendant on the 20th of November, 2001.
5. A declaration of court that all obligations under contract No. W-07344 have not been fulfilled, and therefore another contractor cannot now be introduced into the execution of the jobs encompassed therein or any part(s) thereof by the defendant.
6. A declaration of Court that the purported termination of contract by the defendant purportedly on grounds of non-performance and/repudiation has derogated from the image of the plaintiff as a responsible participant in the Oil and Gas Industry and has therefore occasioned damage to its goodwill.
7. An order of court declaring null and void and of no effect whatsoever and hereby setting aside the purported termination by the defendant of contract No. W-07344 which was executed on the 20th day of November, 2001. Alternatively –
An order of court compelling the defendant to pay to the plaintiff the sum(s) of US $11,435,225.00 plus N227, 192.00 being the balance that may have become due on account of the full execution of the contract, if the plaintiff were allowed to fully execute the contract as specified therein, as it is duly entitled to, together with interest at 21% till judgment is obtained in this suit and the entire sum is liquidated.
8. General damages in the sum of N5 billion against the defendant on account of costs incurred for the various breach (es) of the contract and for loss of goodwill in the Oil and Gas Industry by the purported act or termination of contract, by the defendant purportedly on grounds of non-performance/repudiation by the plaintiff.
It’s also in record that the respondent had on 07/8/2004 filed an action in the Federal High Court, Benin Judicial Division. Also filed with the action was an ex parte motion for an order of injunction restraining the appellant from re-awarding the contract for the rehabilitation of the storage tanks to any other person, which the said court granted on 04/10/2004. However, the said action was struck out on 08/6/2006 by the Federal High Court, Benin upon the respondent’s application.
It’s instructive that on 15/4/2004, the respondent filed in the trial court a motion on notice seeking the following reliefs –
1. An order of this Honourable Court dismissing/striking out this suit in its entirety for lack of jurisdiction to entertain same.
2. An order of this Honourable Court staying further proceedings in respect of this suit pending the hearing/final determination of suit No. FHC/B/CS/182/2004 pending at the Federal High Court in Benin.
3. Such further order(s) as this Honourable Court may deem fit and appropriate to make in the circumstances.
In support of the said motion was a 19-paragraphed affidavit. Attached thereto were various documents marked as exhibits A-E, respectively. Thus, inconsequence of the submissions of the patties’ learned senior counsel, the learned trial Judge delivered the ruling thereof on the said 06/5/2005 to the effect inter alia that:-
“Following from the above, it is my conclusion that on the authority of S.P.D.C. v. Isaiah (supra) this matter is within the exclusive jurisdiction of the Federal High Court. It would have been a different matter if the contract under reference is say, for the rehabilitation of the defendant’s water tank in one of its housing estates. Speaking for myself I must stake (sic) frankly that I see no difference whether the contract is for rehabilitation of a crude oil tank or a water tank. A contract has been breached, pure and simple. However, having regard to what I think the appellate court justices are saying in their decisions. I cannot come to any other decision.
Having come to the above conclusion, the issue of abuse of judicial process can only be of academic value. I will therefore not bother with that. This case is hereby struck out for want of jurisdiction.”
Not unnaturally, being dissatisfied with the above ruling of the trial Court, the appellant filed this appeal.
Both parties have filed and exchanged their respective briefs of argument which they equally adopted on 22/01/2007 when the appeal last came up for hearing. In particular, the appellant has formulated therein only one issue for determination thus:
“Was the Court below right in holding that it has no jurisdiction to determine the plaintiff’s suit?”
On the other hand, the respondent posed what appears to be exactly the same issue as the appellant’s thus:
“Was the court below right in holding that it lacks jurisdiction or not competent to determine the plaintiff/appellant’s suit?”
It was the submission of the learned senior counsel to the appellant that both patties and the trial Court were ad idem that [only] the writ of summons and statement of claim filed in the suit should be looked at, in considering whether the trial court had jurisdiction to hear the suit. That, the statement of claim lucidly gave the cause of action, not as an act relating to, or arising from or ancillary to mining operation, but as the defendant’s inability to rehabilitate storage tanks for crude oil already extracted from the bowels of the earth. That, the tanks are the receptacles from which crude oil is delivered to buyers and that to rehabilitate a tank is to make it serviceable for storing crude oil.
An allusion was made to the provisions of section 251 (1) (n) of the Constitution of the Federal Republic of Nigeria. 1999 as well as section 7(1) and (3) of the Federal High Court Act regarding the jurisdiction thereof. According to the learned senior counsel, section 251(1)(n), 1999 Constitution and 7(1) and (3) of the Federal High Court Act (supra) provide that the said Federal High Court shall have and exercise exclusive jurisdiction [matters relating to] –
“Mines and Minerals (including oil fields, oil mining, geological surveys and natural gas while S. 7(3) stipulates that S. 7(1)(n) shall be construed to include jurisdiction to hear and determine all issues relating to, arising from or ancillary to mines and minerals.”
The cause of action in the said suit No. FHC/PH/CS/1434/2004 was said to be an alleged breach of contract for the hiring/operation of Suffolk’s Oil/Gas drilling rig, damages for breach of contract and specific performance in the alternative. Upon an objection raised in limine to the jurisdiction thereof, the Federal High Court, Port Harcourt declined jurisdiction and consequently transferred the case to the Rivers State High Court.
Reliance was placed on Felix Onuorah v. Kaduna Refining and a Petrochemical Company Ltd. (supra) and Dr. Okoroma v. Christian Uba & Ors. (1999) 1 NWLR (Pt. 587) 359 at 386 it to the effect inter alia that –
“A reading of the sections on jurisdiction discussed earlier shows that what was envisaged are actions against oil mining companies and Federal agencies for acts committed in the course of mining operations occasioning damages to another – in other words tortuous actions. In the instant case the pleading before the court did not allege any act on the part of Shell, a mining company, which caused dam num to Sirpi-Alusteel, the defendant. On the contrary it was the inaction of Sirpi-Alusteel which caused dam num to an oil company, Shell. An action by Shell is therefore outside the Sprit and intendment of the statutes conferring exclusive jurisdiction on the Federal High Court and Sirpi-Alusteel can not be heard to say that any act of Shell arising from related to or connected with mines and minerals caused him any damnum.”
Thus, the learned silk, finally urged on this court to set aside the ruling of the court below and remit the case back to the Rivers State High Court for trial by another Judge.
On his own part, the learned counsel to the respondent from the outset submitted that parties and trial court did indeed agree on the consideration of jurisdiction but to the extent that the “facts/evidence/circumstances flowing from evidence before the court” should be considered along with the writ of summons and statement of claim. He referred to the statement of claim, especially paragraph I thereof, to the effect that the contract awarded to the respondent was for the rehabilitation and refurbishing of four oil/crude storage tanks on terms and conditions thereto. According to the learned counsel, that being the case, only the Federal High Court has the absolute power to adjudicate there upon. See section 7(1)(n), (2) & (3) of the Federal High Court Act (supra). That, the contract related to and arose from mining transmission and processing of crude oil. See SPDC (Nig.) Ltd. v. Isaiah (supra) at 179 D.
It was further contended that transmission of crude oil cannot be complete unless its destination is at the end of the chain which begins with exploration.
Thus, storage tanks and rehabilitation thereof form an integral pan of a crude oil mining operation as in this case. That, the ruling in the said suit No. FHC/PH/CS/1434/2004 is frivolous and irrelevant and not binding on the trial court. That, the matter before this court is for interpretation of section 251(1)(n) of the 1999 Constitution vis-‘a-vis section 7(1) & (3) of the Federal High Court (supra). That, the cases of Felix Onuorah v. Kaduna Refining and Petrochemical Co. Ltd. (supra) referred to by the learned senior counsel to the appellant are irrelevant.
See Nkuma v. Anene (2002) 3 WRN 48 at 55 lines 20-35; Shodeinde v. T.R.T.A.M.I. (2001) 44 WRN at 25; Skenconsult v. Ukey (2001) WRN 5 at page 69; Dalfam (Nig.) Ltd. v. Okaku Int’l Ltd. (2001) 35 WRN 43 at 74 lines 35-40; (2001) 15 NWLR (Pt. 735) 203; Shell Petroleum v. Fibfmcs Ltd. (2002) 7 WRN at 38; KLM Royal Dutch Airlines v. Kumhzi (2004) 46 WRN page 67 para 7; (2004) 8 NWLR (Pt. 875) 231.
The learned counsel concluded by contending that the combined effect and intendment of section 251(1)(n) of the 1999 Constitution, section 7(1) and (5) of the Federal High Court Act (supra) was to divest State High Courts of their concurrent jurisdiction with the Federal High Court in respect of the matters specified in the respective provisions thereof. He thus urged on us to affirm the ruling of the trial court and dismiss the appeal with substantial costs. I have accorded a very critical albeit dispassionate consideration upon the nature and circumstances surrounding the appeal, the submissions of the learned counsel in the respective briefs of argument thereof, as well as the various statutory and case authorities referred to therein. I have deemed it expedient at this stage, to allude to the fact that it’s a trite principle of law that the issue of jurisdiction of a court of law is not only important but also fundamental in adjudicating a case before it. This is most undoubtedly so, because its trite that where a court lacks jurisdiction, power or competence in a case, matter, suit or action, it essentially lacks the vires to adjudicate upon any issue therein. See Labiyi v. Anretiola (1992) 8 NWLR (Pt. 258) 139 at 169 paragraphs C-F; Obada v. Military Governor of Kwara State (1990) 6 NWLR (Pt. 157) 497 at 493 paragraph F; 494 paragraphs A-B; Kotoye v. Saraki (1994) 7 NWLR (Pt. 357) 414 at 466 paragraphs B-C per Adio, JSC (of remarkable and blessed memory) thus:-
“The other is that an objection that a court has no jurisdiction to entertain a matter or an action is very fundamental. It can be raised at any stage of the proceedings in the High Court, Court of Appeal and in this court by the parties or by the court. See Oloriode v. Oyebi (1984) 1 SCNLR 390; (1984) 5 SC and Oloba v. Akereja (1988) 3 NWLR (Pt. 84) 508. So there was nothing wrong with the consideration of it by the court below, especially when, in this case, the determination of the question was a main or vital issue.”
The word jurisdiction has been simply defined as – “A court’s power to decide a case or issue a decree” See Black’s Law Dictionary, Seventh Edition, 1999 at pages 855. The term also denotes the authority or power which a court of law is conferred with by a statute to decide matters before it or to take cognisance of matters presented in a formal way for its decision. See A.-G., Fed, v. Guardian Newspapers Ltd. (1999) 9 NWLR (Pt. 618) 187 at 233 paragraphs A-B.
It’s a well established principle of law that the competence of a court in the exercise of the jurisdiction thereof is determined if-
(i) it is properly constituted with particular regard to the number and qualification of its membership;
(ii) the subject matter of the action is within its jurisdiction;
(iii) the action is initiated by due process of law; and
(iv) any other condition to the exercise of its jurisdiction has been fulfilled. See Madukolu v. Nkemdilim (1962) 2 SCNLR 341; A.-G., Fed. V. Guardian Newspapers Ltd. (supra) 187.
It’s trite that in the determination of whether or not a court has jurisdiction to entertain an action, it’s the claim of the plaintiff ordinarily which has to be looked into. This is so, because it’s the plaintiff who invokes the constitutional right for a determination of his right and thus the exercise of the judicial powers of the Constitution vested in the courts. See Adeyemi v. Opeyori (1976) 9-10 SC 31; A.-G. Fed. V. Guardian Newspapers Ltd. (supra) 187 at 233 paragraphs A-B.
However, as a matter of practice, a preliminary objection challenging the jurisdiction of a court as alluded to above, can be taken at any particular time or stage of the proceedings. See Kotoye v. Saraki (supra) at 466. In some exceptional cases however, it may be advisable for the court to extend its search light beyond the scope of the plaintiff’s statement of claim to the entire pleadings of the parties and vis-‘a-vis the circumstances surrounding the case. This is so because, as the Supreme Court has most authoritatively asserted –
“it is only then that the case being presented by the parties will become clear and certain.” See A.-G., Fed. V. Guardian Newspapers Ltd. (supra) at 254 paragraphs C-D and 261 paragraphs E-G respectively.
As alluded to above, both parties are ad idem regarding the single issue that calls for determination in the instant appeal, to wit “whether the court below was right in holding that it has no jurisdiction to determine the plaintiff/appellant’s suit.”
It was the submission of the learned senior counsel to the appellant that –
“The statement of claim lucidly gave the cause of action, not as any act relating to, or arising from or ancillary to mining operation, but as the defendant’s inability to rehabilitate storage tanks for crude oil already extracted from the bowels of the earth. The tanks are the receptables from which crude oil is delivered to buyers. To rehabilitate a tank is to make it serviceable for storing crude oil.”
On the other hand, the learned counsel to the respondent’s learned counsels submission on that issue is to the effect, inter alia, that –
“The parties and the trial court in its ruling agreed that in considering whether the court had jurisdiction to hear the suit or not, the writ of summons and statement of claim filed in respect of the suit should be considered, but along with all other facts/evidence, circumstances following from evidence before the Court … The contract at hand related to and arose from crude oil mining, transmission/processing.”
As alluded to above, the justice of this case obviously demands that the trial court should extend its search light beyond the scope of the writ of summons and the statement of claim in order to determine whether or not it has jurisdiction to entertain the suit. In other words, the nature and circumstances surrounding the case as a whole, including the contract entered into by both parties, has to be critically, albeit dispassionately, considered as well. It is only then that the complex nature of the dispute between the parties would become clearer and certain. See A.-G., Fed. v. Guardian Newspapers Ltd. (supra) at page 254 paragraphs C-D and 261 paragraphs F-C, respectively.
As it would appear from the records (at page 121 thereof), the learned trial Judge has in the ruling thereof, dated 06/5/05, arrived at the conclusion, inter alia, that –
“With this legal position in mind, I pose the following questions in regard to this case;
Question: What is the cause or matter in this case?
Question: Does the breach of contract complained or have any connection with or pertain to mines; and minerals including oil fields, oil mining, geological surveys and natural gas or issues relating or ancillary thereto or arising therefrom.”
I answer the questions thus – my answer to question (1) is that the cause or matter in this case is damages for breach of contract. My answer to question (2) is “Yes” considering the contract is for the rehabilitation of crude oil storage tanks.
Following from the above, it is my conclusion that on the authority of S.P.D.C. v. Isaiah (supra) this matter is within the exclusive jurisdiction of the Federal High Court.”
I think I cannot agree more with that conclusion. I have accorded a very critical but rather dispassionate consideration upon the writ and statement of claim of the plaintiff/appellant and vis-‘a-vis the entire 124 pages of the contract in question contained in the record (i.e. from page 66(1) – 66 (124). More particularly, Article 3.19 of the contract (at page 66(12) relates to the respondents) liability –
“resulting from any liquid on non-liquid pollutant or waste material that is or has been discharged, seeped, spilled, blown-out, or leaked from the property, equipment, apparatus or machinery of SHELL by the CONTRACTOR … whether or not the negligence or breach of duty… caused or contributed to the discharge, spillage, seepage, or leakage of such pollutant or waste material.”
Article 1.2.13 relates to liability for damage caused arising from excavation of –
“existing under ground structures (piping, cables etc) Any damage to buried facilities during excavations shall be repaved and/or replaced by the CONTRACTOR at no cost to SHELL.”
Article 2.3 provides inter alia that –
“The rehabilitation scope of work for each tank shall include but not limited to the following:
Piping/valves & instrumentation re-installation.
Hydro testing of tank, articulated central drain line, and all tank associated piping.
What’s more, a comprehensive background to the project is provided under Article 2 of the contract thus:
“2.1 Background ground
The UQCC was commissioned in 1967 and is located within the OML-34 approximately East of Warri in the Shell Western Division. It receives about 290,000 Bb/s day of wet crude from thirteen fields through six in coming lines. The crude is separated in four dehydration tanks from where it is pumped via 24″/28″ Trans Forcados Terminal…
The UQCC is currently undergoing a major conversion from a wet crude partial dehydration centre to a wet crude pumping station (otherwise unknown as Ughelli pump station – UPS) and to generally upgrade all facilities to bring them up to modem standard.”
Provisions have also been made in the contract to mitigate potential environmental impacts of the UPS Development Project. See Appendix VI (pages 66 (106 – 107) of the record).
Thus, having regard to the nature and circumstances surrounding the case as a whole, I have no hesitation whatsoever in upholding the finding of the learned trial Judge to the effect that –
“Following from the above, it is my conclusion that on the authority of S.P.D.C. v. Isaiah (supra) this matter is within the exclusive jurisdiction of the Federal High Court.”
From the above highlight, there is no doubt that the contract entered into between the parties which is the cause of action, was executed for the rehabilitation of the four Ughelli crude oil tanks in question. See Articles 1 & 2 of the contract. The word “rehabilitation” has been defined as –
“To restore especially a building to good condition after it has been left to decay.” See Oxford Advanced Learner’s Dictionary, 5th Edition, 1998 at page 983.
As alluded to above, the process of the rehabilitation of the four crude oil tanks in question also includes but not limited to –
Excavation of pipes and cables; piping/valves and instrumentation reinstallation; Refurbishment of all valves and instrumentation. Removal of corroded shell plates and installations of new ones; and supply of blind flanges, studs and gaskets for installation on all process piping to the tank, etc.
I have deemed it pertinent to state that the four Ughelli crude oil tanks in question constructed by the respondent since in 1967 have primarily been used for the storage of crude oil which used to be transmitted thereto from thirteen oil fields through six in coming (pipe) lines. From the four crude oil tanks the crude is then pumped to “Forcados Terminal.” See Article 2.1 of the contract.
Thus, in my view, one of the most important and indispensable aspects of oil mining operation is undoubtedly the construction and rehabilitation (as in the instant case) of crude oil tanks for the storage and pumping (evacuation) of crude oil from the main oil fields to the crude oil terminals through the oil pipe lines. Therefore, if an incident (like oil pollution which was anticipated in the instant case) happens during or in the course of carrying out of the rehabilitation of the four crude oil tanks, it could be aptly explained as having arisen from or connected with or pertaining to mines and minerals, including oil fields and oil mining. One other very important factor which reinforces my view in that regard is the condition stipulated under Article 3.1.19 in the contract which is to the effect that:-
ARTICLE 3.19 CONTRACTORS LIABILITY FOR POLLUTION
1.19.1 Contractor shall be responsible for the prevention, control, disposal or removal of and shall indemnify and hold harmless SHELL, its officers, employees or agents from claims, liabilities costs, damages and expenses resulting from any liquid or non-liquid pollutant or waste material that is or has been discharged seeped, spilled, blown out, or leaked from the property, equipment, apparatus or machinery of SHELL by the contractor, or it’s sub-contractors arising out of or in connection with it’s negligent performance of the work/services, whether or not the negligence or breach of duty of SHELL, its officers employees or agents caused or contributed to the discharge, spillage see page or leaking of such pollutant or waste material.”
Both learned senior counsel have cited and relied upon S.P.D.C. v. Isaiah (supra) at 179 paragraphs D. Per Uthman Mohammed, JSC, to the effect thus:
“I think it can not be disputed if I say that installation of pipelines, producing, treating and transmitting of crude oil to the storage tanks is part of petroleum mining operations. Therefore if an incident happens during the transmission of petroleum to the storage tanks it can be explained as having arisen from or connected with pertaining to mines and minerals including oilfields, and oil mining.”
I have no doubt in my mind in view of the above postulations that the case of S.P.D.C. v. Isaiah (supra) is on all fours with the instant case: Thus, considering the nature and circumstances surrounding the case as a whole, there is no doubt that the contract entered into between the parties is more than meets the eye. It cannot in any way be disputed to have arisen from or connected with or pertained to mine; and minerals most particularly oil fields and oil mining. In my considered view, the said contract is within the purview of the provisions of section 251(1)(n) of the 1999 Constitution and section 1(1)(n), (2) and (3) of the Federal High Court Act (supra). That being the case thus, only the Federal High Court has the [exclusive] jurisdiction to try the case.
Before putting the final dot, I think there is a need to draw a distinction between Felix Onuorah v. Kaduna Refining and Petrochemical Co. Ltd. (supra) and the instant case. The case of Onuora (supra) was regarding a contract in simpliciter to supply a number of 18 litre empty tins at an agreed price the payment for which was fully made. However, before the empty tins could be delivered to the appellant, the respondent increased the price. The appellant rejected the new price and insisted on delivery of the items at the price agreed upon by the parties. Thus, not unexpectedly, the trial Kaduna State High Court rejected the objection that it had no jurisdiction on the ground that the suit was regarding a breach of contract simpliciter which fell within the ambit of the jurisdiction thereof. That decision was not surprisingly upheld by both the Court of Appeal and Supreme Court. Contrariwise, unlike the instant case, Onuorah’s case (supra) had nothing to do with either installation or rehabilitation of crude oil pipe lines or crude storage tanks which, as alluded to above, forms an integral part of a crude oil mining operation. It’s not conceivable to draw a demarcation between installation or rehabilitation of crude oil pipe lines and installation or rehabilitation of crude oil storage tanks.
It’s trite that ever since the notorious case of Alhaji Bukar Umoro Mandara v. A.-G., Fed. (1984) 1 SCNLR 311, the agitation by the Federal Executive to increase the hither to grossly limited jurisdiction of the Federal High Court became rather intensified. See section 230(1) of the Constitution of the Federal Republic of Nigeria, 1979 thus:-
“230(1) – Subject to the provisions of this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have jurisdiction –
(a) In such matters connected with or pertaining to the revenue of the Government of the Federation as may be prescribed by the National assembly;
(b) In such other matters as may be prescribed as respects which the National Assembly has power to make laws.
However, see also section 251, 1999 Constitution (supra) and section 7(1), (2), (3) and (5) of the Federal High Court Act (supra).
Thus, it’s a well settled principle of law that jurisdiction is never conferred on a court in obscurity. This is so because, jurisdiction as the term implies, is so crystally visible to all beholders of the Constitution or the law that confers it. As such, microscopic eyes are not at all needed to unearth it. See Mandara v. A.-G., Fed. (supra), per Obaseki, JSC.
Hence, in the light of the above postulations, I have no hesitation whatsoever in coming to the most inevitable conclusion that the instant appeal is devoid of merit and ought to thus is dismissed. Consequently, the appeal is hereby dismissed by me. The ruling of the trial court dated accordingly affirmed.
I make no order as to costs.
Appeal allowed.