REVENUE MOBILIZATION, ALLOCATION & FISCAL COMMISSION v. UNITS ENVIRONMENTAL SCIENCES LTD
(2010)LCN/4115(CA)
In The Court of Appeal of Nigeria
On Thursday, the 9th day of December, 2010
CA/A/213/09
RATIO
ARBITRAL AWARD: WHETHER PARTIES CAN OBJECT TO THE DECISION OF THE ARBITRATOR EITHER UPON LAW OR THE FACTS
The general rule is that when parties choose to submit to Arbitration in case of a dispute and agree on an Arbitrator to be the judge in the dispute they cannot when the award is good on its face, object to the decision of the Arbitrator either upon law or the facts. See Foli v. Akese 1930 1 WACA 1. The position on this general rule is well captioned in the English case of Hodgkinson v. Fernie 3 CB (NS) 189, 202, 140, ER 712 717. PER REGINA OBIAGELI NWODO, J.C.A.
ARBITRAL AWARD: WHETHER ARBITRAL AWARD IS FINAL AND BINDING
The general principle is that Arbitral award is final and binding. This is covered under S. 31 of the Arbitration and Conciliation Act 1988. The rational is obvious for two reasons, first, the parties have chosen their own judges which they trust to judge fairly and justly and, secondly, the Arbitrators will conduct the Arbitration with fairness and regularity as the parties expect. PER REGINA OBIAGELI NWODO, J.C.A.
STATUTORY PROVISION: PROVISIONS OF THE ARBITRATION AND CONCILIATION ACT 1988 AS IT RELATES TO WHEN AN ARBITRAL AWARD WILL BE SET ASIDE
What then is expected of the lower Court when a dissatisfied party with the award approaches the Court to set aside an Award. S.29 (2) of the Arbitration and Conciliation Act 1988 stipulates as follows: “The Court may set aside an arbitral award, if the party making the application furnishes proof that the award contains decisions on matters which are beyond the scope of the submission to arbitration, so however that, if the decisions on matters submitted to arbitration can be separated from those not submitted, only that part of the award which contains decisions on matters not submitted may be set aside.” In furtherance to setting aside, the same law S.30(1) of the same Act provides as follows: “(1) “Where an arbitrator who has Misconducted himself, or where the arbitral proceedings, or award, has been improperly procured, the Court may, on the application of a party set side the award” The point emphasized under S. 29(2) is that an award has to contain decisions on matters covered by the submission to the Arbitrator, in effect once an Arbitrator makes an award based on a matter which parties have not asked him to arbitrate upon, he has exceeded the scope of his power and the decision may be set aside. S.30(1) of the “Act” stipulates two grounds for setting aside an Award. First is where there is Misconduct of the Arbitrator and secondly, an improperly procured arbitral proceedings or award. PER REGINA OBIAGELI NWODO, J.C.A.
STATUTORY PROVISION: PROVISION OF THE ARBITRATION ACT. 1988 AS IT RELATES TO WHAT AMOUNTS TO MISCONDUCT OF AN ARBITRATOR
In Taylor Woodrow Nig Ltd v. S. E GMBH 1993 4 NWLR pt 285 SC 127 Ogundare, JSC set out what constitutes Misconduct as captioned in paragraph 622 of Halisbury’s laws of England 4th Edn Vol. 2 at pgs 330. In general what is Misconduct is a question of fact in each case. Some of the acts of the Arbitrator which the Courts have held amounting to “Misconduct” have been enacted as law under S. 48 (a) the Arbitration Act. 1988. S.48 (a) of the Act stipulates as follows: “(i) that a party to the arbitration agreement was under some Incapacity; or (ii) that the arbitration agreement is not valid under the Law which the parties have indicated should be applied, Or failing such indication, that the arbitration agreement is not valid under the laws of Nigeria; or (iii) that he was not given proper notice of the appointment of An arbitrator or of the arbitral proceedings or was other Wise not able to present his case; or (iv) that the award deals with a dispute not contemplated by or not falling within the terms of the submission to Arbitration: or (v) that the award contains decisions on matters which are beyond the scope of the submission to arbitration, so however that if the decisions on matters submitted to – arbitration can be separated from those not submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside; or (vi) that the composition of the arbitral tribunal, or the arbitral Procedure, was not in accordance with the agreement of the parties unless such agreement was in conflict with a provision of this Decree from which the parties cannot derogate; or (vii) where there is no agreement between the parties under sub- paragraph (vi) of this paragraph, that composition of the arbitral tribunal or the arbitral procedure was not in accordance with this Decree; or” Where there is error of law on the face of an Arbitral award it may amount to Misconduct. In effect where there is error of law which appears on the face of the award on a point not specifically referred to the Arbitrator for decision then that is a Misconduct See: Taylor Woodrow (Nig) Ltd v. GMBH supra where the supreme court set out the two types of cases of errors on the face of the award that have been recognized in judicial authorities as follows: (1) where a specific question of law is submitted to the arbitrator, the Court cannot interfere and (2) Where a matter or matters in which a question of law becomes material are submitted, the Court will, interfere, if an error of law appears on the face of the award. PER REGINA OBIAGELI NWODO, J.C.A.
AWARD OF INTEREST: FACTORS THAT MUST BE PRESENT BEFORE INTEREST CAN BE PAYABLE OR RECOVERABLE ON ORDINARY DEBT
At common law the general principle is that interest is not payable or recoverable on ordinary debt in the absence of some (a) Contract (b) some mercantile usage (c) statute Equally a Court under its equitable jurisdiction, has power to award interest where a person in a fiduciary position has improperly enriched himself from his fiduciary position. See Wallersteiner v Moir (No2) (1975) QBD 373. PER REGINA OBIAGELI NWODO, J.C.A.
JUDGMENT INTEREST: TYPES OF INTEREST THAT MAY BE AWARDED BY THE COURTS; WAYS BY WHICH A CLAIM FOR INTEREST ON SUM OF MONEY CLAIMED AS A DEBT CAN ARISE
The issue of interest in civil actions raises the question of which type of interest is in dispute. This is because there are two types of interest awarded by the Courts namely: (a) pre-Judgment interest and (b) Post -Judgment interest. In Himma Merchants Ltd v Aliyu 1994 5 NWLR pt 347 SC 667 pg 676. Onu J.S.C on interest said “Indeed there are legally two ways by which a claim for interest on sum of money claimed as a debt can arise. Firstly, as of right and secondly, where there is a power conferred by statute to do so in the exercise of the Courts discretion.” On when is interest claimed as of right the Supreme Court in Ekuwnife v. Wayne (West African limited (1989) 5 NWLR (Pt.122) 422 at 445 per Nnaemeka Asu J.S.C. stated the law on this matter as follows. “Interest may be claimed as a right where it is contemplated by agreement between the parties, or under a mercantile custom or under a principle of equity such as breach of a fiduciary relationship – See London, Chathaim and Dover railway v. S. E. Railway (1893) A. C. 429 at pg.434.” When interest is claimed as a matter of right the presumption is that it is based on an agreement or mercantile custom or trade usage or fiduciary duty. In such circumstance the proper practice is to claim entitlement to it on the writ and plead facts which show such an entitlement in the statement of claim. The grounds on which they are based and lead evidence to show entitlement thereto. PER REGINA OBIAGELI NWODO, J.C.A.
POWERS OF ARBITRATORS: CIRCUMSTANCES UNDER WHICH ARBITRATORS WILL BE EMPOWERED TO GRANT PRE-AWARD INTEREST
Arbitrators have the power to grant pre-award interest but this power is limited to certain circumstances such as: (a) Whether the parties have in the agreement conceded to pre-award interest, the rate and under what circumstance. (b) Where the claim for interest is founded upon mercantile custom or trade usage known to the parties. (c) Where there is a power conferred by statute to do so. PER REGINA OBIAGELI NWODO, J.C.A.
JUSTICE
MOHAMMED LAWAL GARBA justice of The Court of Appeal of Nigeria
PAUL ADAMU GALINJE justice of The Court of Appeal of Nigeria
REGINA OBIAGELI NWODO justice of The Court of Appeal of Nigeria
Between
REVENUE MOBILIZATION, ALLOCATION & FISCAL COMMISSIONAppellant(s)
AND
UNITS ENVIRONMENTAL SCIENCES LTDRespondent(s)
REGINA OBIAGELI NWODO, J.C.A. (Delivering the Leading Judgment): This is an appeal against the Judgment of the Federal High Court Abuja division delivered on the 11th of May 2009 granting the application to Recognize the Arbitral award delivered on the 7th of December, 2007 by a Sole Arbitrator and leave to enforce the said Arbitral Award.
The Appellant as plaintiff in the Federal High Court filed a Motion on Notice dated the 26th of February, 2008 seeking an order of the Court setting aside the arbitral award dated the 7th of December, 2007 made by the Sole Arbitrator Hon. Ifeanyi Tim Anogo in favour of the Respondent in the Arbitration between the parties arising from the dispute on the Consultancy agreement in respect of the proposed Staff Housing Development at Mabushi, Abuja. The motion set out 3 grounds in support of the Application.
The Respondent as Defendant in the application filed a counter affidavit followed by a Motion on Notice dated 11th of July, 2008 seeking an order to recognize the Award delivered by the Sole Arbitrator Hon. Ifeanyi Tim Anogo on 7th December 2007 in the matter of the Arbitration for the purpose of enforcement of the award and an Order granting leave to the Respondent to enforce the Arbitral Award published on 7th of December 2007.
The Brief facts as garnered from the affidavit of the plaintiff in the Court below is that sometime in 2002, a Consultancy Service agreement was entered into between the parties in the suit with respect to a proposed Staff Housing Development in Mabushi Abuja for the Appellant. A dispute arose between the parties from the Consultancy Agreement. Pursuant to an Arbitration clause in the Agreement the Federal High Court on 30/05/2006 appointed a Sole Arbitrator Mr. Ifeanyi Anogo. The Sole Arbitrator after hearing both parties published an award on the 7th of December, 2007 in favour of the Respondent.
The Appellant dissatisfied with the award then filed the Motion on Notice to set aside the Award. Whilst the Respondent filed the application for leave to enforce the Award.
The learned trial Judge in the Federal High Court heard the two Motions together and in a considered Judgment delivered on 11/5/09 held as follows (pg 281 of Record of Appeal):
“In totality, the application to set aside the arbitral award dated the 26th of February, 2008 and filed on the same date did not succeed It is hereby struck out”
In respect of the Motion to enforce the Award, the trial Judge held:
“The Applicant has compiled with the provisions of Order 20 rule 15 (1) & 17 of the Federal High Court Civil Procedure Rules 2000 and S.1(1) and (2) of the Arbitration and Conciliation Act Cap A 18 laws Federation of Nigeria (LFN) 2004.
The application of the Applicant dated the 11th day of July, 2008 hereby succeeds. The reliefs are hereby granted as prayed. See Ave Fenus Enterprise vs Saipem Niseria Limited (20091 2 NWLR part 1126 page 483 at 522.”
The Appellant aggrieved by the decision of the Court below filed a Notice of Appeal on the 27th day of May 2009 containing four grounds of Appeal.
In compliance with the rules and practice of this Court, the parties by their respective Counsel filed and exchanged briefs of argument.
At the hearing of the Appeal on 14/10/2010 the learned Counsel for the Appellant adopted the Appellant’s brief of Argument dated 14th July 2009 filed on 15/7/09 and the reply brief filed on 21/4/2010. The learned Counsel for the Respondent adopted the Respondent’s Brief filed 1/3/2010 and deemed as properly filed and served on 15/4/2010.
The learned Counsel for the Respondent referred to the Respondent’s notice argued in the Respondent’s Brief in paragraph 4.00 submitting that even if they did not file Respondent’s notice what they ask the Court to do is already within the inherent power of the Court.
In the Appellant’s Brief signed by P. Y. Garuba, the learned Counsel formulated the following four Issues for determination:
‘(i) Whether it is the law that all commercial transaction attract pre-Award interest irrespective of what the parties to the transaction had agreed upon and if not, whether the same is not an apparent misconduct warranting the setting aside of the published Award of the day of December, 2007 in which pre-Award interest sum of N33,934,139.53 was granted in favour of the respondent. This issue is with respect to ground one of the notice of appeal of 27/05/09.
(ii) Whether there was apparent or proved Government Policy affecting the execution of the interest entered into by the parties and if so whether the same is not a misconduct warranting the setting aside of the published Award of 07/12/2009. This issue is with respect to ground Two of the Notice of Appeal filed on 27/05/2009.
(iii) Whether it was right in law to formulate and/or reframe issues suo motu without affording the parties the opportunity of being heard on the issue and where the answer is in the negative, whether the same is not a misconduct warranting the setting aside of the published Award of 07/12/2007. This issue is with respect to ground THREE of the Notice of Appeal filed on 27th day of may 2009.
(iv) Whether the learned trial judge was right in law when he proceeded to grant the enforcement of the published Award of the 7th day of December, 2007. This Issue is with respect to ground four of the Notice of Appeal filed on 27th day of May, 2009.”
The learned Counsel Dr. Olumide Ayeni signed the Respondent’s Brief and he formulated a sole issue for determination which reads as follows:
“Whether in the circumstances before the Federal High Court, the trial Judge was correct in refusing the Motion on Notice seeking to set aside the Arbitral Award of 7th December 2007, while recognizing the Award for recognition and enforcement following the Motion on Notice filed on 11th July, 2008.”
I will adopt the 3 issues distilled in the Appellant’s Brief but must note that it is badly phrased. Every issue for determination must be formulated from and related to a competent ground of appeal. The Issue so formulated must be precise and concise. In the instant appeal, the Appellant under each of Issues 1 – 3 raised secondary questions. A party is allowed to only distill one issue from one ground of appeal.
Issue one:
Whether it is the law that all commercial transaction attract pre-Award interest irrespective of what the parties to the transaction had agreed upon.
It is the submission of learned Counsel to the Appellant Mr. Garuba that the lower court’s decision that the contract agreement between the parties being a commercial one carries along with it a pre-Action interest is without foundation in law in view of the decision of the Supreme Court in the cases of HIMMA MERCHANTS LTD VS ALHAJI INUWA ALIYU 1994 6 SCNJ @ (PT1) 87 at 94 & 95:
SAEBX TERNS TO BERIMA /S V OLAOGAN ENTERPMSES LTD 1999 12 SCN/ 171 at 187.
It is his argument that the Supreme Court and the Appeal Court have held that a party claiming pre-award or pre-action interest must through evidence not extrinsic evidence establish either by contract or under statute the right to such pre-award interest. He contends that by the Doctrine of Stare Decisis the Court below is bound by the decision of the Supreme Court. He cited:
BASHIR MOHAMMED DALHATA V IBRAHIM SAMINU TARAKI 2003 7 SCNJ AT 12.
Learned Counsel argued, referring to the pleading of the Respondent that the first claim is traceable to the Consultancy Services Agreement whilst the second and third claims which are based on Pre-award interest claim are not traceable to the Consultancy Service Agreement. He further contends that there is nothing in the pleadings to suggest that the claimed pre-award interest is implied by custom and or Trade Usage. Therefore the lower Court should not have accepted the submission of Respondent’s counsel that this is a commercial transaction and failure to award the pre award interest will amount to a Misconduct.
It is his submission that the basis of the pre award interest as granted in the published award is extrinsic to the consultancy agreement which is the basis of the Arbitral proceeding and the published Award.
Learned Counsel urged the Court to hold that the learned trial judge was wrong to hold that all commercial transaction attract pre-award or action interest and to find that the grant of pre-Award interest is a Misconduct allowing for the setting aside of the published Award on its entirety as there is no agreement on the pre-award interest claim by the parties. He cited TAYLOR WOODROW OF NIGERIA LTD v. SUDDEUTSCHE ETNA – WERK GMBH 1993 4 S.C.N.J. 32 at 45 BAKER MARINE NIG. LTD VS CHEVRON 2001 FWLR (pt.471) 1143.
The learned Counsel’s contention is that parties are bound by the terms of the agreement and there was no Pre-award interest and such written contracts cannot be varied and that any pari claiming Pre-Award interest must establish such claim by concrete evidence.
It is the contention of learned Counsel to the Respondent Dr. Olumide Ayeni that the Sole Arbitrator found that the claimant now Respondent had pleaded the issue of claims of pre and past award interest as head of damages and led evidence that was not challenged, it is his submission that all the ingredients relating to a successful plea of a claim of interest both pre and past award were present in Exhibit EGC I. The Arbitral Award which the Appellant in the lower Court produced and tendered in evidence.
Learned Counsel for the Respondent further submitted that where a party had pleaded and adduced evidence which his adversary did not challenge, contradict or controvert, provided such facts and material are not manifestly unbelievable as in this case the Court may not interfere with such finding but should take the further step of affirming the position as representing the truth.
He cited NZERIBE V DAVE ENGINEERING COMPANY LTD.1994 I NITLR (PT 361) 124:
Dr. Ayeni further contended that the Respondent was entitled to be granted the interest even if he had not specifically claimed it because the law recognizes that in commercial transactions, a party who ought to have been paid money if kept out of its use would be entitled to an award of interest determinable at the prevailing market rate and in this case by reference to commercial banking lending rate of interest.
He cited the following cases:
NIGERIA GENERAL SUPER INTENDANCE COMPANY LTD V. P. A (1990) 1 NWLR (PT.129) 7411784:
R. E. O. ENTERPRISES LTD V. NWOSU 2002 11 WRN 28, 33;
NATIONAL BANK OF NIGEKIA LTD. V SAVOL WEST AFRICA LTD 1994 3 NWLR (PT 333) 435;
THIRWELL V. OYEWUNMI 1990 4 NWLR (PT.144) 384, 406.
This issue raises the question of whether the grant of pre-Award interest sum of N33,934,139,53 in the published Award is a Misconduct in other words was the Court below wrong not to have set aside the published Award in its entirety on the basis that there is no agreement on the pre-award interest claim.
The general rule is that when parties choose to submit to Arbitration in case of a dispute and agree on an Arbitrator to be the judge in the dispute they cannot when the award is good on its face, object to the decision of the Arbitrator either upon law or the facts. See Foli v. Akese 1930 1 WACA 1.
The position on this general rule is well captioned in the English case of Hodgkinson v. Fernie 3 CB (NS) 189, 202, 140, ER 712 717
The general principle is that Arbitral award is final and binding. This is covered under S. 31 of the Arbitration and Conciliation Act 1988. The rational is obvious for two reasons, first, the parties have chosen their own judges which they trust to judge fairly and justly and, secondly, the Arbitrators will conduct the Arbitration with fairness and regularity as the parties expect.
What then is expected of the lower Court when a dissatisfied party with the award approaches the Court to set aside an Award.
S.29 (2) of the Arbitration and Conciliation Act 1988 stipulates as follows:
“The Court may set aside an arbitral award, if the party making the application furnishes proof that the award contains decisions on matters which are beyond the scope of the submission to arbitration, so however that, if the decisions on matters submitted to arbitration can be separated from those not submitted, only that part of the award which contains decisions on matters not submitted may be set aside.”
In furtherance to setting aside, the same law S.30(1) of the same Act provides as follows:
“(1) “Where an arbitrator who has Misconducted himself, or where the arbitral proceedings, or award, has been improperly procured, the Court may, on the application of a party set side the award”
The point emphasized under S. 29(2) is that an award has to contain decisions on matters covered by the submission to the Arbitrator, in effect once an Arbitrator makes an award based on a matter which parties have not asked him to arbitrate upon, he has exceeded the scope of his power and the decision may be set aside. S.30(1) of the “Act” stipulates two grounds for setting aside an Award. First is where there is Misconduct of the Arbitrator and secondly, an improperly procured arbitral proceedings or award.
The Appellant founded his relief in the Court below for setting aside on the ground of misconduct of the Arbitrator. The word Misconduct is not specifically defined under the Act. However the Act under S.48 set out circumstances when to set aside an award. These examples are not conclusive as one may still have recourse to the common law and case law to determine acts not covered under S. 48 to determine what Constitutes Misconduct.
In Taylor Woodrow Nig Ltd v. S. E GMBH 1993 4 NWLR pt 285 SC 127 Ogundare, JSC set out what constitutes Misconduct as captioned in paragraph 622 of Halisbury’s laws of England 4th Edn Vol. 2 at pgs 330.
In general what is Misconduct is a question of fact in each case. Some of the acts of the Arbitrator which the Courts have held amounting to “Misconduct” have been enacted as law under S. 48 (a) the Arbitration Act. 1988. S.48 (a) of the Act stipulates as follows:
“(i) that a party to the arbitration agreement was under some Incapacity; or
(ii) that the arbitration agreement is not valid under the Law which the parties have indicated should be applied, Or failing such indication, that the arbitration agreement is not valid under the laws of Nigeria; or
(iii) that he was not given proper notice of the appointment of An arbitrator or of the arbitral proceedings or was other Wise not able to present his case; or
(iv) that the award deals with a dispute not contemplated by or not falling within the terms of the submission to Arbitration: or
(v) that the award contains decisions on matters which are beyond the scope of the submission to arbitration, so however that if the decisions on matters submitted to – arbitration can be separated from those not submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside; or
(vi) that the composition of the arbitral tribunal, or the arbitral
Procedure, was not in accordance with the agreement of the parties unless such agreement was in conflict with a provision of this Decree from which the parties cannot derogate; or
(vii) where there is no agreement between the parties under sub- paragraph (vi) of this paragraph, that composition of the arbitral tribunal or the arbitral procedure was not in accordance with this Decree; or”
Where there is error of law on the face of an Arbitral award it may amount to Misconduct. In effect where there is error of law which appears on the face of the award on a point not specifically referred to the Arbitrator for decision then that is a Misconduct See: Taylor Woodrow (Nig) Ltd v. GMBH supra where the supreme court set out the two types of cases of errors on the face of the award that have been recognized in judicial authorities as follows:
(1) where a specific question of law is submitted to the arbitrator, the Court cannot interfere and
(2) Where a matter or matters in which a question of law becomes material are submitted, the Court will, interfere, if an error of law appears on the face of the award.
In the present appeal under Issue one the complaint of the Appellant is that the lower court held that all commercial transaction attract pre-award interest when the pre-award interest made by the Arbitrator was not based on agreement on pre award interest and thereby occasioned a miscarriage of justice on the appellant. In effect was the learned trial judge wrong when he refused to set aside the award on the ground there was no agreement and evidence to support the pre-award interest. The learned trial judge held (see pg 273 of the Record of Appeal)
“The submission of the Applicant that it has never been contemplated by parties in the award, this I cannot accept. I agreed entirely with learned counsel to the Respondent that this is a commercial transaction and failure to award the said pre-award interest will amount to a Misconduct. See law and Practice of Arbitration and conciliation in Nigeria (1999) by Orojo and Ojo page 268.”
“Even where interest has not been specifically claimed or contemplated by both parties once it has been established that the transaction includes commercial dealing, as evidence in this case, interest can be awarded. I therefore hold that the pre-award interest of the sum of N33,934,139.53 awarded by the Hon. Sole Arbitrator was proper…”
The learned trial Judge by the above decision refused to set aside the Award on the basis of misconduct rather he ordered for enforcement of the award.
The issue of interest in civil actions raises the question of which type of interest is in dispute. This is because there are two types of interest awarded by the Courts namely: (a) pre-Judgment interest and (b) Post -Judgment interest. In Himma Merchants Ltd v Aliyu 1994 5 NWLR pt 347 SC 667 pg 676. Onu J.S.C on interest said
“Indeed there are legally two ways by which a claim for interest on s sum of money claimed as a debt can arise. Firstly, as of right and secondly, where there is a power conferred by statute to do so in the exercise of the Courts discretion.”
On when is interest claimed as of right the Supreme Court in Ekuwnife v. Wayne (West African limited (1989) 5 NWLR (Pt.122) 422 at 445 per Nnaemeka Asu J.S.C. stated the law on this matter as follows.
“Interest may be claimed as a right where it is contemplated by agreement between the parties, or under a mercantile custom or under a principle of equity such as breach of a fiduciary relationship – See London, Chathaim and Dover railway v. S. E. Railway (1893) A. C. 429 at pg.434.”
When interest is claimed as a matter of right the presumption is that it is based on an agreement or mercantile custom or trade usage or fiduciary duty. In such circumstance the proper practice is to claim entitlement to it on the writ and plead facts which show such an entitlement in the statement of claim. The grounds on which they are based and lead evidence to show entitlement thereto.
At common law the general principle is that interest is not payable or recoverable on ordinary debt in the absence of some
(a) Contract
(b) some mercantile usage
(c) statute
Equally a Court under its equitable jurisdiction, has power to award interest where a person in a fiduciary position has improperly enriched himself from his fiduciary position. See Wallersteiner v Moir (No2) (1975) QBD 373.
The Supreme Court in HIMMA MERCHANTS LTD V. ALIYU 1994 supra per Onu J.S.C on issue of prejudgment interest said
“Where therefore there is no evidence whatsoever as in the instance case, that the claim of interest is founded upon any rationale e.g. mercantile custom or trade usage known to the parties, the claim of interest for 20% per month from July, 1988 which ante dates the judgment passed on 27th October, 1989 by the trial Court is without foundation and ought to have been disallowed by the Court below.”
On when pre judgment interest can be claimed the Court of Appeal held in Henkel Chem Ltd v. A. G. Ferrero & Co 2003 4 NWLR pt. 810 C A 306.
“In the absence of evidence to the effect that in event of a breach or default on the payment of a valuation certificate the defaulting party would be liable to interest on the outstanding sum, in my respectful view, the claim is not made out”.
“As a party cannot unilaterally impose a term of contract on the other, the parties to the agreement must be – ad idem on a term and condition of the contract before it becomes enforceable. The right to interest is equally not established without reference to fiduciary relation, trade practice or custom or mercantile usage or statute providing for such interest. There is, therefore, no justification for the award of interest on the judgment debt from 29th December, 1989 to the date of judgment on 16th June, 2000.”
Arbitrators have the power to grant pre-award interest but this power is limited to certain circumstances such as:
(a) Whether the parties have in the agreement conceded to pre-award interest, the rate and under what circumstance.
(b) Where the claim for interest is founded upon mercantile custom or trade usage known to the parties.
(c) Where there is a power conferred by statute to do so.
In the instant appeal the Arbitrator in the published Arbitral Award determined the issue of pre-award interest as follows: (See page 38 of the record of Appeal)
“That the Respondent shall pay to the claimant the sum of 33,934,139.53 (thirty three million, nine hundred and thirty four thousand, one hundred and thirty nine naira, fifty three kobo only) as interest up to the dated of the award and thereafter at the rate of N982,912.92 per month or N32,314.95 per day until the award is satisfied and discharged.”
The claimant now Respondent in the Arbitration Tribunal claimed interest on the outstanding fees for Consultancy works done on the proposed Staff Housing Development Project at Mabushi Abuja by reference to 400 basis points for the period proceeding the Arbitral award.
I have carefully gone through the Consultancy Services agreement and there is no where in all the clauses where the parties specifically stipulated the payment of interest on debt arising from the services rendered prior to the Award in case parties proceed to Arbitration nor is there any statement on the Award ex facie to show that interest is based on mercantile usage or custom. The Arbitrator made his findings in the Award which were accepted by the Court below but then there is nothing on pre-award interest in the Agreement nor is it customary in transactions of the nature rendered.
In Arbitration proceedings the general principle is that facts found by an Arbitrator is not a ground for setting aside an award on the ground that it is wrong nor a ground for setting aside an award that there is no evidence on which the facts could be found because that would be mere error in law . It is also not misconduct to come to a wrong conclusion in law unless the error in law appeared on the face of it. See Gillcapee Bross & Co. v. Thompson Bross & Co. (1992) 12 WL Rep. 519 at 324. See also Commerce Assurance Ltd v. Alhaji Buraimoh Alli 1992 3 NWLR (Pt.232) 710 at 725.
The Arbitrator, notwithstanding the general principle that he is at liberty to make findings is still restrained to determine the issues within the confines of the issues referred to him and the Agreement between the parties. The lower Court is under a duty once called upon to set aside an award or enforce same to look at the published Award and ensure on the face of it, there is not error in law or any misconduct. The learned trial Judge was wrong in his decision not to accept the Appellants counsel submission that the parties did not contemplate the award of Pre Award, interest in their Agreement, Parties that voluntarily entered into an agreement are bound by the terms of same.
The Consultancy service Agreement did not provide for pre-award interest. There is no evidence of consensus ad idem on payment of interest before judgment or award neither is there evidence of a trade practice or mercantile practice. Commercial transaction entails the conduct or act of carrying on of trade, business or a financial matter to a conclusion or settlement. The failure to award interest amounts to misconduct where the Arbitrator fails to award interest when appropriate and gives no reason for such failure it must therefore be appropriate to so grant as it not Automatic.
The parties entered into a Consultancy Service Agreement for provision of services in two phases. It is not a case of mere trading or financial issues. Every commercial transaction is determined on the basis of the facts, the dispute and the terms of Agreement, if any. Therefore it is not in every action arising from a commercial transaction that pre-award interest will be awarded.
I had earlier in this judgment set out when a Court can award preaction interest. It is not the law as held by the learned trial judge that once a transaction involves commercial dealing as in this case interest will be awarded whether specifically claimed or contemplated by both parties. The law is settled that every claim for interest must be specifically pleaded and proved. Pre-judgment interest based on agreement or custom must be claimed in the writ of summons or pleaded in the statement of claim and evidence adduced in proof of it, failing which the Court will not award it. See HAUSA v F.B.N. PLC 2000 9 NWLR (Pt.761) 64.
If there is an Agreement as in this situation the burden is on the claimant to show that the pre award interest claim is based on the terms of the agreement or the custom of trade or statute. A claim for pre award interest on outstanding debt can only be as of right or based on statute. If it is as of right the Respondent is to show where it is contemplated in the agreement or under a mercantile custom. He must also plead facts to show such entitlement in the statement of claim. see HIMMA MERCHANTS LTD v. ALIYU supra.
Therefore the learned trial Judge erred when he held that even when interest has not been specifically claimed once it involves commercial dealing, interest can be awarded. The Arbitrator can only grant pre- award interest if parties had agreed and specified it on the Consultancy Service Agreement or there are facts showing it is the custom in such transaction. There was no agreement to that effect nor any evidence on the Award that the pre- award interest made by Arbitrator was based on specific custom or trade. The Arbitrator by his award decided the issue of pre award interest which is not included in the agreement of reference and thus exceeded his authority which amounts to misconduct. See Watford Baker & Co v Macfie & Sons (1915) 84 L J K B 2221. See also Henkel Chemicals (Nig.) ltd v A. G. Ferrero & Co Ltd Supra . Where an Arbitrator determines an issue which parties did not contemplate in the Agreement that lead to Arbitration in the first instance the Court will intervene to set aside the Arbitrators decision on that point.
In the present circumstance it was not appropriate to so award pre-Award interest. The Supreme Court has settled the issue on award of pre-judgment interest. I am encouraged by the catalogue of decisions of the Apex Court particularly in Ekwunife v. Wayne (West Africa) limited 1989 5 NWLR (Pt.122) 422 See also Edem v. Cannon Ball Ltd 1998 6 NWLR (pt 553) 298.
I therefore resolve issue one in favour of the Appellant against the Respondent.
On Issue No 2 whether there was proved Government Policy affecting the execution of the contract entered into by the parties and if so whether the same is not a misconduct warranting the setting aside of the published Award of 07/12/2009.
Learned Counsel for the Appellant submitted that as at the time parties entered into the contract, the certain Political, Public and Judicial Office Holders (Salaries and Allowances, etc Act No 6 2002 was not in existence but the same having came into existence in the course of executing the contract is deemed to have full effect on the contract. He cited TAOFIK ALAO V AFRICAN CONTINENTAL BANK LTD 1998 2 SCNJ 17 at 28 FESTUS IBIDAPO ADESANOYE & 2 Others v. Francis Adewole 2006 7 SCNJ 501 at 517.
It is his further contention that the learned trial Judge erred fundamentally in law when he held that the certain Political, Public and Judicial Office Holders (Salaries and Allowances, etc) Act No 6,2002 as a Government policy did not in anyway frustrate the contract existing between the parties (Appellant & Respondent) and then proceeded to uphold the Award.
It is his further contention that the Appellant being an agent of the Federal Government of Nigeria is only a part of the executive Arm of Government and not the legislative that enacted the certain Political, Public and Judicial Office Holders (Salaries and Allowances etc) Act No 6 2002. That he ought to have been allowed by the lower court to claim frustration of its contract with the Respondent since in its view the Appellant did not enact the Act.
Learned Counsel referred to the preamble in the contract between the parties where Respondent had put itself out as an Agent of the Federal government. Learned counsel further argued that it is settled in law that a party to a commercial transaction to which it freely entered with full capacity and knowledge of the state of facts at the time of the contract will not be allowed to resile from its obligations by pleading illegality relying on its own self induced act to set up spurious claims of frustration or force majeure, or to generally avoid the contract particularly when such party had obtained advantages in terms of valuable consideration. He cited Kwajaffa v. Bank of the North Limited 2004 13 NWLR (Pt.889) 146-177. Ajaokuta Steel Company Limited 2004 16 NWLR (Pt.899) 369, 392 – 393.
Learned Counsel for the Respondent contended that the argument of Appellant that a statute and two circulars containing policy of the agent frustrated the contract does not represent the true position of the law because there is nothing on the certain Political, Public and Judicial office Holders (salaries and Allowance, etc) Act No 2, 2002 that forbids the consultancy Service Agreement for staff housing development and that none of the two circulars were tendered in evidence either before the sole Arbitrator or in the lower Court and it cannot form basis of a complaint. Further that the Appellant made part payment of N4 million to the Respondent in realization of its obligations under the contract and as proof that consideration was received for it.
The Appellants strong contention is that the subsequent legislation made by the Federal Government of Nigeria made the Consultancy service contract void and therefore unenforceable, in order words that the certain Political, Public and Judicial Office Holders Act frustrated the contract and the appellant are not members of the legislative to have induced the frustration. The Respondents contention is that the Appellant having benefited from the contract he cannot void same by reasons of illegality.
In the law of contract there is a distinction between contracts rendered illegal by Statute and contracts which were legal when made but which in the course of performance, became an issue of a new statute prohibiting the commission of the terms of the contract. In respect of the first circumstance, a party to the contract can only have a remedy based on a cause of action which does not involve illegality, in the latter situation the innocent party may enforce the contract. see Ajaoukuta Steel Co Ltd v. Corps Ins Ltd 2004 16 N.W.L.R. Pt.899 CA 369. In Onyiuke v. Okeke (1976) 3 SC 1, the Supreme Court per Alexander, C.J.N. said A contract may be discharged by a supervening prohibition such as where the prohibition would have made the contract illegal, had it been in force when the contract was made. A contract which does not involve the commission of a legal wrong may be illegal because its tendency is to bring about a state of affairs of which the law disapprove on grounds of public policy. Such contract is illegal only if its harmful tendency is clear and there is probability of injury to the public and not merely its possible consequence, where a statute prohibits or regulates the making or performance of a contract, breach of the statute may make the contract illegal, void or unenforceable or remains valid depending on whether the breach amounts to a crime. Equally a contract which does not involve the commission of a legal wrong may be illegal because its tendency is to bring about a state of affairs which the law disapproves on grounds of public policy.
Under the principle of frustration a contract entered into with mutual consent may be discharged if after its formation events occur making its performance impossible when supervening events had destroyed some basic, assumption on which the parties had contracted. Supervening illegality is a ground of discharge because the court has to take into account the relative interest of the parties and the interest of the public in seeing that the law is observed. In the instance appeal both parties agree that the statute enacted which had a retrospective effect was an intervening event. The area of contest is whether the contract became illegal and frustrated in the circumstance of the enactments of the certain political, public and judicial officer holders Act. The Arbitrator on page 28 of the Record of Appeal had this to say on whether there is an enforceable contract in the light of the law.
“I therefore hold that the federal Government who entered into the contract with the claimant, to turn around after receiving valuable consideration, and enacts law with retroactive retrospective effect invalidating the contract and therefore resiling from its obligation is acting contrary to public policy. . . .”
The learned trial judge did pronounce on issue of public policy on the basis that the Appellant having benefited from the contract cannot void it by reason of illegality
In Thirwell v. Oyewumi 1990 4 NWLR PT.143 CA 384 Akanbi, JCA said.
“…a contract declared void by statute may not be an illegal contract unless in relation thereto, there is also a penalty, imposed by law. The penalty it is said makes it illegal.” See Solanke v. Abed (1962) 1 ALL WLR 230
On when an agreement is illegal the Supreme Court in Nnadozie v. Mbagwu (2008) 3 NWLR Pt.1074 SC.363 held “… An agreement is illegal if the consideration or the promise involves doing something illegal or contrary to public policy.”
I have critically examined the Act; certain Political, Public and Judicial Office Holders (Salaries and Allowance, etc) 2002. (hereinafter referred to as 2002 Act) This “Act” commenced on the 29th of May, 1999 whilst the Agreement between the parties that lead to Arbitration was entered into on the 27th December, 2001. The unique aspect of the Act is that it was enacted in 2003 after the parties entered into the contract but to commence earlier than date of enactment, in effect it had retrospective effect. A statute having retrospective status takes care of past events in that it draws forward such matters to have legislative effect with all the status of the new statute See Adesanoye v. Adewole 2006 7 SCNJ SC 501.
The preamble to the 2002 Act states as follows:
..AN ACT TO PRESCRIBE SALARIES, ALLOWANCES AND FRINGE BENEFITS FOR CERTAIN POLITICAL, PUBLIC AND JUDICIAL, OFFICERS OF THE FEDERATION AND FOR RELATED PURPOSES.”
The Act contains the Basis salary for certain political and public officers in the Federal Executive.
The Consultancy Services Agreement described the project for the agreement as STAFF HOUSING AND ANCILLARY, FACILITIES AT Mabushi, Abuja. One of the Category of officers listed in the schedule is the Revenue Mobilization Allocation and fiscal Commission. The Appellant in this appeal. The “Act” under column for Accommodation specified that Accommodation is to be provided or payment of 100% be made to the staff. There is nowhere in the entirety of the “Act” that it stipulated penalty for contravening of the provisions contained therein. The use of the phrase ‘or’ means that a staff of the Appellant has the option to choose accommodation provided or take his allowance for accommodation. Consequently the “Act” cannot be described as containing provision which frustrated the contract to build a staff Housing Facility. This is because there is no prohibition in the “Act” that bars the Appellant entering into an agreement to build staff quarters. The Appellant has an option for its staff to provide Accommodation or monetise.
This is not a supervening prohibition. The contract cannot be void ab initio for illegality.
The frustrated expectation or intentions of the Appellant to the contract do not necessarily lead to the frustration of that contract. See CONGIMEX EXPORT S. A 1983 I LLOYDS REP 250 at 253.
In Amalgamated Investment & Property Co ltd v John Walker & Sons ltd 1977 I W. L. R. 164 the Court held that a contract for the purchase of property for redevelopment was not frustrated when the buildings on the land were listed as being of special architectural or historic interest, so that redevelopment become more difficult or impossible and the property lost most of its value. The position of the Appellant obviously is founded on the monetization of the Accommodation allowance but there is no provision in the 2002 “Act” submitted to the Arbitrator for determination that raises the issue of monetization. A construction of the 2002 “Act” presents an option of taking the accommodation or the allowance of 100% the latter option imputes the value of the Accommodation is monetized. The Arbitrator referred to the issue of monetization raised by the Appellant but did not decide on its effect in the Award published. His decision was merely that the Federal Government by enacting the law with retrospective effect invalidated the contract acting contrary to public policy. The issue of frustration does not arise in this matter.
It is trite that a contract is not frustrated merely because its execution becomes more difficult or more expensive than either party originally anticipated and has to be carried out in a manner not envisaged at the time of its negotiation.
A contract is frustrated where after the contract, events occur which make performance of the contract impossible illegal or radically different from what was in the contemplation of the parties. The events that have been held by the courts to constitute frustrating events include, subsequent legal changes, destruction of the subject matter of the contract, outbreak of war, governments requisition of the subject matter of the contract.
The learned trial Judge rightly stated that where a law makes it impossible for parties to perform part of their contract. It is frustration but erred when he stated that frustration can only arise when the frustrating factor is coming from a different party to the contract. This is because a contract of employment may be frustrated by the innate inability or illness of one party to perform the contract in the manner anticipated. See Candor v. the Barron knishts 1966 7 W.L.R.89.
Under Issue 3 it is the submission of learned Counsel for the Appellant that the learned trial judge erred in law when he held that the Sole Arbitrator was right to have reframed the issues formulated by the parties suo motu without first hearing from the parties. The contention of the learned counsel is that the act did amount to a misconduct warranting the setting aside of the published Award. He cited Registered trustees of the Rosicrucian Order Amorc (Nig.) v. Henry O. Awoniyi (1994) 7 – 8A. C.N.J. (PT.11) 390.
It is Appellant Counsel’s contention that non of the parties made any reference in the Arbitral proceeding to the publication referred to by the Sole Arbitrator neither was same pleaded by the parties that the Arbitration is to be governed by the Rules of the Nigerian Surveyors. It was important for the Arbitrator to have called on both parties to address him on the viability of the reframed issues before publishing the Award. It is his submission that the omission is fatal to the entire proceedings and occasioned a miscarriage of justice on the Appellant. It is his further contention that the learned trial judge erred when he held that the Sole Arbitrator was right to reframe issues for the parties suo motu without first hearing from the parties and that the act did not amount to a misconduct.
Learned Counsel for the Respondent in response submitted that ground 3 of the Notice of Appeal is directed as a challenge against the decision of the Sole Arbitrator not the learned trial judge. It is his contention that this court has no jurisdiction to entertain an appeal against the Award as its jurisdiction is limited to appeal on decisions from the High Court and other Courts not the Arbitration Award.
The Learned Counsel for the Appellant’s contention is that Ground 3 in the Notice of Appeal when read with its particulars shows that there is an appeal against the Ruling of the trial Court that upheld the Sole Arbitrators actions in reframing issues without hearing the parties and their Counsel.
The learned Counsel for the Respondent reaction in paragraph 3.22 of the Respondent’s address amounts, to an objection to ground 3 of the Notice of Appeal.
By Order 10 Rule 1 of the Court of Appeal Rules 2007, A Respondent intending to rely upon a preliminary objection to the hearing of the appeal, should give the Appellant three clear days notice before the hearing of the appeal, setting out the grounds of the objection, and should cite such notice See Kayode ventures Ltd v The Hon Minister of Federal Capital Territory (2010) 7 NWLR pt 1192 SC 171.
However the Courts have shown liberal attitude to non compliance by holding that failure to file the notice in accordance with the rules does not render it ineffective. Nevertheless the grounds and argument in support of the objection should be incorporated in the Respondents Brief and argued before the appeal is heard. See Uwazurike v A. G. Federation 2007 8 NWLR (pt 1035)1 SC. Order 10 Rule 3 gives the Court discretion to make an order as it thinks fit in the event that the Respondent fails to cite the Notice of preliminary objection.
In the instant appeal, there is a notice of the objection. The Respondent’s complaint is clear and precise and the Respondent Brief was served on the Appellant who filed a Reply on point of law responding to the objection.
However, the learned Counsel for the Respondent did not raise and argue the objection before the appeal. The consequence is that the objection contained in paragraph 3.22 of Respondent’s Brief is deemed as abandoned and I so hold.
The complaint of the Appellant under issue 3 is that the learned trial judge held that the sole Arbitrator was right to have reframed the issues for the parties suo motu without giving parties opportunity to react.
The Arbitrator in the opening paragraph stated as follows: (see para 10 of the Award)
“Issues one and two of the Respondent’s submission of 14th January 2007 are not in contention. Collapsing the issues holistically into one shortlist, the continuous issues as derived from the claimants Address and the Respondents submissions are as follows:..”.
The Arbitrator listed 8 Issues. It is clear from the above statement that the Arbitrator rephrased the issues relying on questions raised already by the parties. I have gone through the six (6) issues formulated by the Respondent on page 96 of the Record and the Appellant on page 97 and, I cannot find therein a new issue raised suo motu by the Arbitrator, the complaint of Appellant that did not state Arbitration will be governed by the Rules of Nigerian Institute of Quantity Surveyors and Arbitrator raised same is not visible on the face of issues raised in the Award, the question raised by both parties were subsumed into eight (8) issues by the Arbitration. The Arbitrator can reframe issues raised as long as that will exhaustively deal with the crucial and fundamental points raised by the parties. The limitation on the Arbitrators power is that the issues repharsed must have been addressed in the submissions of counsel, where new issues not argued by parties have been raised by the Arbitrator each party is entitled to be heard on the principle of fair hearing. Where an Arbitrator decided a matter on a point not put by the parties that is a misconduct. I agree with learned counsel for the respondent that all the Sole Arbitrator did was to identify the issues formulated for determination on behalf of the respective parties before reformulating them, for ease of consideration. The act of the Arbitrator in the circumstance cannot be held to be misconduct. Consequently issue 3 fails.
On issue 4 it is the submission of the learned counsel for the Appellant that the failure of the learned trial judge to give any consideration to the appellant’s further counter affidavit of 11/09/2008 and the grant of the order to enforce the published Award dated 07/12/2007 has occasioned a miscarriage of justice on the Appellant. Learned counsel to the Respondent in response argued that there is no issue of fair hearing legitimately arising in this appeal and that the position of the law is the finality of Exhibit EGC 1, the Arbitral Award which is the primary concern of the Courts. It is his contention that the Arbitral Award is final and the Court has a duty to construe an Award as to make it final as between the parties. He cited United Nigeria Insurance Company Limited v Stocco 0973) NCLR 231 He submitted that no case of misconduct has been made out concerning the sole Arbitrator visa-vis Exhibit EGC 1, the Arbitral Award.
The learned trial judge, after a summary of the arguments of counsel held that the Respondent did not show any sufficient reason why the arbitral award should not be recognized and enforced as the Judgment of this court.
In considering an application to recognize and enforce an award the High Court is not sitting as an appellant court over the award of the Arbitrator. At that stage the lower court is not empowered to determine whether or not the findings of the Arbitrators and the conclusions are wrong in law. What the trial judge need to do is to look at the award and determine whether on the state of the law as understood by the Arbitrator and stated on the face of the Award, the Arbitrator complied within the law as they themselves rightly or wrongly perceived . It is not the duty of the Court to review the facts before the Arbitrator. Averments in an Affidavits and counter are statements on facts. It is the error on law or misconduct on face of Award that should be the determinant factor.
I had earlier under Issue one held that by the settled principle of law under pre -award of interest there was misconduct on the part of the Arbitrator when he awarded the pre award interest when there is no provision in the Agreement for pre award interest nor is the issue of interest established as merchantile or trade practice, in the type of Consultancy Service entered. Once there is misconduct within the law or error on the face of the Award the Court ought not to grant the application to recognize and enforce the Arbitral Award. The learned trial Judge was wrong in the circumstance to have allowed application. Issue four is resolved in favour of the Appellant. In the circumstance that I have found Issues one and four in favour of the of the Appellant, this Appeal succeeds in part and is allowed accordingly.
RESPONDENT’S NOTICE
The Respondent filed, a Notice of Intention to contend, wherein he seeks, an Order that the decision of the court below be varied in form l0A pursuant to Order 9 Rule I Court of Appeal Rules 2007.
Learned Counsel for the Respondent’s contention is that the learned trial judge considered the application to set aside the award and proceeded to strike out the application instead of dismissal of the motion filed on 26th February, 2008. It is his submission that the order of the trial judge be varied to circumvent the principle of res judicata in respect of a matter that has been considered on its merit. He cited several cases including Tinubu v Khlil & Dabbo transport Limited 2000 11 NWLR (Pt.677) 171, 182 A – C where the Supreme Court held that after parties had concluded their evidence, the striking out was not the proper order. It is the contention of learned Counsel to the Appellant that since the learned trial judge erred in law in striking out the motion the only option open to the Respondent is to reverse the decision through a cross appeal and not variation. He referred to Nabisco Inc. v Allied Biscuits Company Ltd 1998 7 SCNJ 235 – 1243: Dr Tunde Bamboye v. University of Ilorin & another 1999. 6 SCNJ 295 at 319.
The question raised is whether the respondent should have cross-appealed instead of filing a respondent Notice.
Order 9 rule 1 of the Court of Appeal Rules 2007 stipulates as follows:
“A respondent who not having appealed from the decision of the court below, desires to contend on the appeal that the decision of that Court should be varied, either in any event or in the event of the appeal being allowed in whole or in part, must give notice to that effect, specifying the grounds of that contention and the precise form of the order which he proposes to ask the Court to make, or to make in that event, as the case may be.”
A Respondent who has not appealed against the decision of the Court below can decide to contend on the appeal that the decision of the Court should be varied in the event that the appeal is allowed in whole or part. By this provision a respondents Notice is filed only if there is an appeal pending and the Respondent have no objection to the judgment but wants it varied.
The Supreme Court in Nabisco v Allied Biscuits (supra) interpreting a similar provision and identifying the distinction between Respondents Notice and cross Appeal held per Ogwuegbu SC pg 243.
“One characteristic of order 3 rule 14 is that it applied only where the Respondent intends to retain the Judgment but at the same time wants it varied. The point or points which the notice contemplated must have arisen from the appeal. A respondent’s notice is only available to vary and retain the judgment and not a reversal. Where a respondent seeks to contest a different issue or cause of action different from the one raised by the appeal served on him, or a reversal of an adverse finding, he can only do so by notice of appeal or cross appeal.”
Where a Respondent seeks to contest a different issue or cause of action different from the one raised in the Notice of Appeal he can only do so by notice of appeal or cross appeal. See Nabisco S.C. N. J SC 235: Western Steel Works Ltd & Or v. Iron & Steel Workers Union of Nigeria & Ors. 1987 1 N.S.C.C. 133.
Thus once a Respondent in an appeal is seeking a complete reversal in his favour of a finding made by a lower Court, he can only do so through a substantive cross appeal not a respondents notice.
The Respondent in the instant Appeal is not seeking a reversal of the findings made by the trial Judge, what he seeks by his Notice is a variation of the final Order made by the Court below not on cause of action or findings of Court. It is my firm view that the respondent came through appropriate procedure when he filed the Respondents notice. The nature of what he sought from Court does not require a cross appeal.
The learned trial Judge struck out the Motion to set aside the Arbitral Award after he had considered the submissions of Learned Counsels on the merit of the Application.
The question arising is whether he should make an order striking out the Motion on Notice or an Order of Dismissal. Where an application has been considered on Merit after hearing from the learned counsels, the appropriate Order to make is one of Dismissal and not strike out.
In the light of the forgoing I hold that the respondents notice is appropriate and there is merit in the notice to vary the Order.
In consequence of allowing the Appeal partially the Judgment of the learned trial Judge made on the 7th May, 2009 allowing for enforcement of the Award is hereby set aside. The Order of Lower Court in respect of the Motion on Notice dated 26th February, 2008 seeking an Order to set aside which was refused and struck out is also set aside. In its place I hold that there is Merit in the motion to set aside refused by the Court below. I hereby set aside the Arbitral Award published on 7th December 2007 by the Sole Arbitrator.
Each party should bear its own cost.
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Appearances
P. Y. GarubaFor Appellant
AND
Dr. O. Fayemi with Mrs. B. O. Williams & N. Mohammed Esq. K. E. Akporaye-ArahFor Respondent
