ALH. ABUBAKAR SADIK DANTAMA v. UNITY BANK PLC (2015)

ALH. ABUBAKAR SADIK DANTAMA v. UNITY BANK PLC

(2015)LCN/8068(CA)

In The Court of Appeal of Nigeria

On Wednesday, the 4th day of March, 2015

CA/S/81/2014

RATIO

COURT: DUTY OF THE COURT; WHETHER IT IS THE DUTY OF THE COURT TO EMBARK UPON CLOISTERED JUSTICE

The plaintiff needs to prove the exact indebtedness of the defendant including the interest and default charge and the basis of the calculation.
This needs to be demonstrated in open court. The court cannot verify the claim of the plaintiff within the closet of the learned trial Judge.
This would amount to cloistered justice which is not the duty of the court. See ACN V LAMIDO & ORS [2012] LPELR – SC 25/2012 where Fabiyi JSC said;
“It is not the duty of a court or Tribunal to embark upon cloistered justice by making enquiry into the case outside the open court not even by examination of documents which were in evidence but not examined in the open court. A judge is an adjudicator; not an investigator. See Duriminiya V Commissioner of Police (1964) NRNLR 70; Queen V Wilcox (1961) 1SCNLR 296; (1961) ALL NLR 633; Dennis Ivienagbor V. Henry Osato Bazuaye (1999) 6 SCNJ 235 ar 234; Onibudo V. Akibu (1952) 7 SC 60.” per. TUNDE O. AWOTOYE, J.C.A.

PRACTICE AND PROCEDURE: PRE-JUDGED INTEREST; WHETHER IT IS RIGHT TO AWARD INTEREST PRE-DATING THE DATE OF JUDGEMENT WHERE PARTIES HAVE AGREED ON PAYMENT OF INTEREST

The first award predates the judgment; it is therefore a prejudgment interest which is subject to proof by the claimant. In Afribank Nigeria Plc Vs Mr. Chima Akwara (2006) LPELR 199, The Supreme Court per Ogbuagu JSC held:-
“It is now settled, that except where parties have agreed on payment of interest, it is not right to award interest pre-dating the date of judgment.”
In Himma Merchants Ltd Vs Alh. Inuwa Aliyu (1994)5 NWLR (Pt.347) 667, (1994)6 SCNJ (Pt. 1)87 at 95, the same Supreme Court, per Onu JSC said:-
“The best method of satisfying a Court about the existence of any matter is by adducing credible, sufficient and satisfactory evidence about it. In the case in hand there is no evidence whatsoever about the rate of interest agreed upon by the parties and the basis upon which it is computed.”
Finally in Daniel Holdings Ltd Vs UBA (2005)23 NSCQLR 175 at 190, the Supreme Court held:-
“As for interest on judgment debt it is either based on what the parties agreed to in their contract or the current bank rate. Bank rate, issued by Central Bank of Nigeria in occasional circulars is not a matter to take judicial notice of under evidence Act, there must be some evidence of it.”
See Ogbu & 4 Ors Vs Ani & 2 Ors (1994)7 NWLR (Pt. 355) 128, Kaduna State Transport Authority Vs Olodile (1999) 10 NWLR (Pt.622)259 at 265, Nigeria Dynamics Ltd Vs Ibrahim (2002) 8 NWLR (Pt.768) 63. Per. PAUL ADAMU GALINJE, J.C.A.

PRACTICE AND PROCEDURE: PRE-JUDGEMENT INTEREST; WHAT A PARTY MUST PLEAD BEFORE HE CAN CLAIM PRE-JUDGEMENT INTEREST

It follows therefore that before a party can claim pre-judgment interest, he has to plead not only his entitlement to the interest, but the basis of the entitlement either by statute or contract/agreement between the parties, or under mercantile custom or under principle of the equity. Per. PAUL ADAMU GALINJE, J.C.A.

PRACTICE AND PROCEDURE: WHAT CONSTITUTE A DEFENCE ON MERIT IN THE UNDEFENDED LIST PROCEDURE

The undefended list procedure is designed to shorten and to eliminate the technicalities of pleadings. A defence on the merits for the purposes of the undefended list procedure may encompass a defence in law as well as on fact. The defendant must put forward some facts which cast doubt on the claim of the plaintiff. Thus, a defence on the merits is not the same as success of the defence in litigation. All that is required is to lay some foundation for the existence of a triable issue or issues. What constitute a defence on merit depends on the facts of the case. This is within the discretion of the court of trial which must be exercised judicially and judiciously after a full and exhaustive consideration of the affidavit in support of the notice of intension to defend. Per. MUHAMMED L. SHUAIBU, J.C.A.

PRACTICE AND PROCEDURE: WHAT AN AFFIDAFIT IN SUPPORT OF THE NOTICE OF INTENTION MUST DISCLOSE

It was held in plethora of judicial decisions that the affidavit in support of the notice of intention to defend must not contain a mere general statement that the defendant has a good defence to an action. But such a general statement must be supported by particulars which if proved would constitute a defence. It is sufficient if the affidavit discloses:-
(a) a triable issue or that a difficult part of the law is involved;
(b) that there is a dispute as to the facts which ought to be tried;
(c) that there is a real dispute as to the amount due which requires the taking of an account to determine; or
(d) any other circumstances showing reasonable grounds of a bonu fide defence.
See ATA GUBA & CO V. GURA (NIG) LTD (2005) 8 NWLR (Pt.927) 429 at 457. Per. MUHAMMED L. SHUAIBU, J.C.A.

Before Their Lordships

PAUL ADAMU GALINJEJustice of The Court of Appeal of Nigeria

TUNDE OYEBANJI AWOTOYEJustice of The Court of Appeal of Nigeria

MUHAMMED L. SHUAIBUJustice of The Court of Appeal of Nigeria

Between

ALH. ABUBAKAR SADIK DANTAMAAppellant(s)

AND

UNITY BANK PLCRespondent(s)

TUNDE O. AWOTOYE, J.C.A. (Delivering the Leading Judgment): This is the Judgment in respect of the appeal filed by the appellant on 11/4/2014 against the decision of Sambo J. of Sokoto State High Court of Justice sitting in Sokoto delivered on 31/3/2014.

On 10/12/2013 the plaintiff had applied by an exparte motion dated 9/12/2013 for leave to issue a writ of summons marked “Undefended List” and for same to be placed under the Undefended List. The affidavit in support of the motion was a 23 paragraph affidavit. On 20/10/2014m the plaintiff’s application was granted.

The writ of summons marked “Undefended List” was issued on 20/1/2014. The claim of the plaintiff as endorsed on its writ of summons read as follows:
“The Defendant on 25th July, 2008 applied to the Branch Manager of Aliyu Jodi Branch, Sokoto of the Plaintiff for an advance facility of N3,000,000.00 (Three Million Naira) only and on 22nd September, 2008 the Plaintiff approved the application wherein it granted the Defendant an Advanced Facility to be repaid within a period of three months from the date of disbursement.
The purpose of the facility was to enable the Defendant to execute a contract awarded to him by Silame Local Government Council for rehabilitation of road at N20.0m. The interest rate is 20% per annum and the parties agreed that the interest rate was subject to change depending on prevailing market condition.
The repayment of the facility was to be domiciled to Unity Bank but the Defendant defaulted when he collected the payment of the contract sum directly.
The Plaintiff wrote several demand letters to the Defendant but he (the Defendant) failed, refused or neglected to heed to the demand letters. The Plaintiff is entitled to continue to charge interest on the facility based on mercantile customs of bankers to charge compound interest on the account and also based on the Central Bank of Nigeria monetary guidelines.
1. The Plaintiff claims from the sum of N5, 121, 715.45 being unpaid balance of the Advance Facility and accrued interest outstanding against the Defendant’s account number 0001001714 with the Aliyu Jodi Branch, Sokoto as at 29th November, 2013 despite repeated demands.
2. 10% on the judgment sum from 18th November, 2013 until judgment is delivered in this suit.
3. Thereafter 10% on the judgment sum until judgment sum is finally liquidated.
4. Cost of this action”

The defendant filed his Notice of Intention to defend and counter affidavit in Support of Notice of Intention to defend on 4/2/2014.
The Learned trial Judge on 31/3/2014 entered judgment in favour of the plaintiff after hearing the parties.
His Lordship had this to say on page 64 of the record of appeal;
“In the case under consideration and having regards to the affidavit evidence and supported by the exhibits ‘A – L’ can it be said the counter affidavit of the defendant had disclosed triably (sic) issues? My answer to the question above is absolutely no and this is in line with what I have earlier observed herein having had the advantage to read and compare the affidavit evidence both presented. Therefore I am satisfied with what plaintiff had presented before this court. The counter – affidavit is simply a saving dace in the absence of any triable issue.”

Consequently the learned trial Judge gave judgment as follows: –
“Therefore from the foregoing, I am satisfied a prima facie case has been made out by the plaintiff and entitled to the judgment of this court in its favour.
Some other issues raised which I have not been able to address go to no issue consequently, plaintiff succeeds and as follows:
1. Defendant to pay the sum of N5,121,715.45 being unpaid balance of the Advance facility and accrued interest outstanding against him on the Account No.0001001714 with the Unity Bank Plc. Aliyu Jodi Branch Sokoto.
2. 10% on the judgment sum from the 18/11/2013 to date
3. 10% on the judgment sum until judgment sum is liquidated.
4. The cost of this action”

Dissatisfied with this judgment, the appellant filed a Notice of Appeal containing four grounds of appeal on 12/6/2014.
The grounds of appeal (excluding the particulars) are as follows: –
“Ground 1
The judgment is against the weight of evidence
Ground 2
The Learned Trial Judge erred in law and misdirected himself on facts, when he entered judgment for the Plaintiff and ordered the defendant to pay the sum of N5,121,715.45k and thereby occasioned miscarriage of Justice.
Ground 3
The learning Trial judge erred in law and misdirected himself on facts and thereby occasioned miscarriage of justice when he held that “Some other issues raised which I have not been able to address go to no issue consequently, plaintiff succeeds and as follows…
Ground 4
The Learned Trial Judge erred in law and on the facts when he entered judgment for the Plaintiff when he has no jurisdiction to do so.”

The record of appeal in this appeal was deemed transmitted on 10/11/2014.
On receipt of the record of appeal, parties filed and exchanged briefs of argument.
The appellant’s brief of argument was settled by Sulaiman Usman counsel for the appellant and filed on 7/11/2014.
In his brief learned counsel for the appellant formulated 3 issues for determination to wit: –
1. Whether the learned trial Judge made a correct approach to the evidence adduced by both parties having regard to the nature of issues placed before him and raised in pleadings, in particular the Affidavit Evidence adduced (Ground 1 and 2 of the Notice of Appeal)
2. Whether the Learned Trial Judge was right in having other issues raised unresolved [Ground 3 of the Notice of Appeal]
3. Whether in all the circumstances of this case, High Court of Justice of Sokoto State has jurisdiction to hear and determined (sic) the Respondent case when the claim was not paid for [Ground 4]

On issue 1, learned counsel submitted that the trial court failed to assess and evaluate the facts and evidence adduced by parties to see which side preponderated. He relied on FATOYINBO V WILLIAMS [1956] 5 SCNLR 274; LAWAL V DAWODU [1972] 1 ALL NLR (PT 2) 270 and some other cases.
He further argued that by the contents of the affidavit in support of notice of intention to defend, the defendant sufficiently discharged the burden of showing that there existed a defence on the merits. He cited OKOLI V MORECAB FINANCE NIG LTD [2007] 14NWLR (PART 1053) 37.

He submitted that if there were disputed issues of fact disputed issues of fact disclosed from a comparison of the party’s affidavit, the court ought to transfer the suit to the general cause list for determination on merits. All that was needed, according to him was that some doubt must be created in the court’s mind. He cited V. S. STEEL [NIG] LTD V GOVT OF ANAMBRA STATE [2001] 8 NWLR (Part 715) 454 at 467
He finally urged the court to resolve all the issues in favour of the appellant.

The Respondent’s brief, prepared by Suleiman Oji, Respondent’s counsel, was filed on 19/11/2014. The Respondent’s counsel formulated one sole issue for determination of this appeal as follows:
Whether the trial Judge was right when he refused to transfer the suit to the General Cause List
Learned Respondent’s counsel submitted on this issue that contrary to the submission of appellant’s counsel, it was the appellant who failed to challenge the depositions of the Respondents’ affidavit leaving the trial Judge with no option but to enter judgment against the appellant. He further referred to page 54 of the Record of appeal to contend that the defendant did not disclose any triable issue at the trial court. He asserted that a look at the supporting affidavit and the documentary evidence showed clearly that the appellant was indebted to the plaintiff to the amount claimed. He referred to paragraphs 17 and 20 of Respondent’s affidavit and queried how the appellant wanted the sum of N2,034,961.56 to stagnate for more than two years. He relied on several judicial authorities including: – THOR LTD V FCMB LTD [2005] ALL FWLR 217 at 222-223 (2) OKOLI V MORECAB FIN (NIGERIA) LTD [2007] 33 WRN 1 at 7. He urged the court to resolve the issue in favour of the Respondent and dismiss the appeal.

I have carefully considered the submissions of counsel on both sides as well as the contents of the record of appeal.
I have also deeply considered the issues formulated by both parties. I am of the respectful view that the lone issue formulated by Respondent is adequate for the determination of this appeal.
For clarity’s sake I hereby restate the issue.

Whether the trial Judge was right when he refused to transfer the suit to the General Cause List
In resolving this sole issue there is need to examine the claim of the plaintiff (now Respondent) the supporting affidavit and the defence of the defendant (appellant).

In a suit of this nature, for the defendant to cause the court to transfer the suit from the undefended list to the general cause list he must show a reasonable defence or prima facie defence strong enough to create a doubt in the mind of the judge. According to Tabai JSC in UBA PLC & ANOR V ALHAJI JARGABA [2007] 11 NWLR [PT 1045] 247
“A suit initiated under the undefended list procedure can only be considered appropriate for transfer to the general cause list where the defendant’s notice of intention to defend is supported by an affidavit showing that there is prima facie case or triable issues that needed to be settled upon pleadings, tried tested and determined in oral evidence. The defendant’s affidavit evidence must disclose that there is a real dispute and not merely a frivolous and vague defence designed to delay the quick determination of the action.”

It is equally right to be mindful of the purpose of the undefended list procedure and what type of action can come up under the procedure. Order 22 Rule 1 of the Sokoto High Court Civil Procedure Rules makes it clear. It states
“whenever application is made to a court for the issue of a writ of summons in respect of a claim to recover a debt or liquidated money demand and such application is supported by an affidavit setting forth the grounds upon which the claim is based and stating that in the deponent’s belief there is no defence thereto, the court shall if satisfied that there are good grounds for believing that there is no defence thereto, enter the suit for hearing in what shall be called ‘the Undefended List’ and mark the writ of summons accordingly and enter therein a date for hearing suitable to the circumstance of the particular case.”

Where the claim of the plaintiff includes interest it has been held by the apex court that the plaintiff must disclose in his affidavit how his right to interest accrued and how the rate thereof was arrived at. See SURVEYOR AKPAN V AKWA IBOM PROPERTY & INVESTMENT COMPANY LTD [2013] LPELR – SC 96/2008.

I shall consider this appeal in the light of the above.
The parties in this appeal did not dispute the fact that the sum of three million naira only was advanced to the defendant by the plaintiff on 22/9/2008 with interest at 20% per annum in the defendants own showing his indebtedness at October 2010 was N4,200,000.00 covering principal sum and two year interest of 20% per cent per annum. In paragraph 4 (1 – f) counter – affidavit in support of notice of intention to defend filed on 4/2/2014, the defendant averred thus: –
“That paragraphs 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20 and 21 contained a lot of misrepresentation and same are hereby denied except as stated in the following paragraphs;
a. I was given an overdraft advance facility and not a loan to the tune of 3,000,000.00 (three million naira only) with interest of 20% per annum as shown in exhibit B attached to the Affidavit in Support of Writ of Summons.
b. The Principal sum was credited to my account on the 30th day of October, 2008
c. That as at October 2010, the amount stood at N4,200,000.00 covering the principal sum and two year interest of 20% per cent per annum.
d. That I paid the entire principal sum of N3,000,000.00 and paid N220,000.00 part of the interest on 25th June 2010, 9th November 2010 respectively leaving a balance of N980,000.00 only
e. That I traveled to Abuja sometimes in January 2011 where I met the Head of the Credit Unit of the plaintiff in her Abuja Corporate Headquarters and who phone Mr. Bulama at Unity Bank Sokoto Branch and told him on phone in my presence my Indebtedness N1,257,296.95k and asked him to write a memo for interest waiver subject to payment of additional N800,000.00 by the end of February 2011.
f. That I thank and came back to Sokoto and raised N800,000.00 which I paid by cash deposit on 25th February, 2011”

What seems to be in dispute is the total accrued interest. In my respectful view claims for interest by banks on loans are almost always complicated as interest rates are not fixed because they are subject to change. Claims for such interest should not be made under the undefended list. One is more fortified in this view when one considers the deposition of the plaintiff in paragraph 9 of its supporting affidavit. It reads: –
“That the interest rate chargeable on the facility was 20% which the parties agreed was subject to change (s) depending on money market conditions which now stood at 32% and the Defendant having defaulted to liquidate the facility within the agreed period the plaintiff by banking customs add 4% defaulted charge to the current interest rate to 36%.”

I am of the view that the defendant has made out a reasonable prima facie defence on merits to warrant the court to transfer the suit to the general cause list. There is a triable issue as can be gathered from the affidavit filed. It must be noted that the procedure is not designed to shut out the defendant who can show in his affidavit in support of intention to defend any that there is a triable issue see NISHIZAWA V JETH WANI (1984) 12SC 124 at 134.

I resolve the sole issue in favour of the appellant. This appeal has merit. It is hereby allowed.
The decision of D. B. Sambo J. sitting at Sokoto High Court delivered on 31/3/2014 in suit no. SS/99/2014 is hereby set aside. In its place I hereby order that the claim of the plaintiff be transferred to the general cause list. Parties are to file pleadings under the Rules of court accordingly.
No costs awarded.

PAUL ADAMU GALINJE, J.C.A.: I have had the privileged of reading in draft the judgment just delivered by my learned brother Awotoye JCA and I agree with the reasoning contained therein and the conclusion arrived thereat.

Judgment in the claim before the High Court was delivered on the 31st March 2014 in which two categories of interest were awarded. These were 10% on the judgment sum from the 18th November 2013 to date and 10% on the judgment sum until judgment sum in liquidated. The first award predates the judgment; it is therefore a prejudgment interest which is subject to proof by the claimant. In Afribank Nigeria Plc Vs Mr. Chima Akwara (2006) LPELR 199, The Supreme Court per Ogbuagu JSC held:-
“It is now settled, that except where parties have agreed on payment of interest, it is not right to award interest pre-dating the date of judgment.”
In Himma Merchants Ltd Vs Alh. Inuwa Aliyu (1994)5 NWLR (Pt.347) 667, (1994)6 SCNJ (Pt. 1)87 at 95, the same Supreme Court, per Onu JSC said:-
“The best method of satisfying a Court about the existence of any matter is by adducing credible, sufficient and satisfactory evidence about it. In the case in hand there is no evidence whatsoever about the rate of interest agreed upon by the parties and the basis upon which it is computed.”
Finally in Daniel Holdings Ltd Vs UBA (2005)23 NSCQLR 175 at 190, the Supreme Court held:-
“As for interest on judgment debt it is either based on what the parties agreed to in their contract or the current bank rate. Bank rate, issued by Central Bank of Nigeria in occasional circulars is not a matter to take judicial notice of under evidence Act, there must be some evidence of it.”
See Ogbu & 4 Ors Vs Ani & 2 Ors (1994)7 NWLR (Pt. 355) 128, Kaduna State Transport Authority Vs Olodile (1999) 10 NWLR (Pt.622)259 at 265, Nigeria Dynamics Ltd Vs Ibrahim (2002) 8 NWLR (Pt.768) 63.

In the instance case the award of pre-judgment interest was wrong as same was not proved by the Respondent herein. I do agree with my brother that the suit would have been transferred to the general cause list.
For this and the more elaborate reasons in the lead judgment, I too allow the appeal and endorse all the consequential order made therein, including order as to cost.

MUHAMMED L. SHUAIBU, J.C.A.: I have had the privilege of reading in advance, the judgment just delivered by my learned brother, Awotoye, JCA and I entirely agree with the reasoning contained therein and the conclusion arrived thereat.

In the instant case, the appellant as defendant at the lower Court averred in paragraph 4 (d) of the affidavit in support of the notice of intention to defend averred thus:-
d. “That I paid the entire principal sum of N3,000,000.00 and paid N220,000.00 part of the interest on 25th June, 2010, 9th November, 2010 respectively leaving a balance of N980,000.00 only”

The above clearly shows that there is a real dispute as to the amount due which requires the taking of an account to determine. And since interest still has to be proved and assessed, a decision which purports to consider interest on a liquidated money demand denies the jurisdiction to the court under the undefended list procedure. A court determining a claim under the undefended list procedure cannot expand its jurisdiction by assessing interest claimed in the suit since the procedure is available for speedy judgment on a liquidated money demand only or for a debt where the defendant has no defence.
See GOMBE V. P. W. OIL (NIG) LTD (1995) 6 NWLR (Pt.402) and EKERETE V. UBA PLC (2005) 9 NWLR (Pt.930) 401 at 414.

It is for the foregoing reasons in addition to those more elaborately set out in the leading judgment of Awotoye, JCA, that I also allow the appeal and abide by the consequential orders made in the said judgment.

Appearances

M. H. Adamu Esq. with G. A. Shehu Esq.For Appellant

AND

Dr. Suleiman Oji Esq.For Respondent