ALUMINIUM MANUFACTURING COMPANY NIGERIA LIMITED v. VOLKSWAGEN OF NIGERIA LTD. (2012)

ALUMINIUM MANUFACTURING COMPANY NIGERIA LIMITED v. VOLKSWAGEN OF NIGERIA LTD.

(2012)LCN/5338(CA)

In The Court of Appeal of Nigeria

On Monday, the 30th day of April, 2012

CA/L/414/2003 (R)

RATIO

JUDGMENT: PRESUMPTION OF CORRECTNESS OF A JUDGMENT OF A COURT OF COMPETENT JURISDICTION

It is trite and well settled in many judicial authorities that where the Judgment of a court of competent jurisdiction is not manifestly illegal or wrong, the Court of Appeal would be correct to presume that the Judgment or order appealed against is correct or rightly made until the contrary is proved or established. See Nigerite Ltd. v. Dalami Nig. Ltd. (1992) 7 N.W.L.R. (Pt.253) 288; Denton West v. Muoma (2008) 6 N.W.L.R. (Pt.1083) 418; In Re-Diamond Bank Ltd. (2002) 17 N.W.L.R. (Pt.795) 120 at 134 G – H. Thus, this court will not ordinarily indulge in the practice of denying a successful litigant of the fruits of his success except under very special circumstances. See Vaswani Trading Company v. Savalakh & Co. (1972) 12 SC 77 at 81. PER JOHN INYANG OKORO, J.C.A.

JUDGMENT: PRINCIPLES GUIDING THE GRANT OR REFUSAL OF STAY OF EXECUTION PENDING APPEAL

COURT: WHETHER A COURT HAS AN UNIMPEDED DISCRETION TO GRANT OR REFUSE A STAY OF EXECUTION

It is trite that a court has an unimpeded discretion to grant or refuse a stay of execution of Judgment. The court is however bound to exercise its discretion not only judicially, but judiciously as well. As was noted by Fabiyi, JCA (as he then was) in STB Ltd. v. Contract Resources Nig. Ltd. (2001) 12 N.W.L.R. (Pt.725) 518 at 525 paragraphs G – H, the discretion of the court “must not be exercised capriciously or erratically”. See Vaswani Trading Co. v. Savalakh & Co. (supra); Deduwa v. Okorodudu & 13 Ors. (supra). PER JOHN INYANG OKORO, J.C.A.

JUDGMENT: DUTY OF A PARTY SEEKING A STAY OF EXECUTION IN RESPECT OF A MONETARY JUDGMENT

JUSTICES

KUMAI BAYANG AKAAHS Justice of The Court of Appeal of Nigeria

JOHN INYANG OKORO Justice of The Court of Appeal of Nigeria

RITA NOSAKHARE PEMU Justice of The Court of Appeal of Nigeria

Between

ALUMINIUM MANUFACTURING COMPANY NIGERIA LIMITED Appellant(s)

AND

VOLKSWAGEN OF NIGERIA LTD Respondent(s)

JOHN INYANG OKORO, J.C.A. (Delivering the Lead Ruling): By a Motion on Notice dated and filed on 22nd July, 2010, the Judgment Debtor/Applicant prayed this court for the following reliefs:-
“1. An order staying the execution of the Judgment of this honourable Court delivered on 4th February, 2010 per their Lordships Adzira Gana Mshelia, Regina Obiageti Nwodo, Adamu Jauro JJCA pending the determination of the Judgment Creditor’s appeal pending at the Supreme Court.
IN THE ALTERNATIVE
2. AN ORDER of this Honourable Court granting leave to the Judgment Debtor/Applicant to pay instalmentally the Judgment Debtor/Applicant to pay instalmentally the Judgment debt of N4,883,261.00 (Four million, eight hundred and eighty three thousand, two hundred and sixty one naira) only plus interest at the rate of 7’bd% (seven and a half percent) per annum from 8/12/92 till judgment debt is fully liquidated and N10,000.00 all being the judgment of this Honourable Court per their Lordships Adzira Gana Mshelia, Regina Obiageli Nwodo, Adamu Jauro, JJCA on 4th February, 2010 in the following manners:
(i) One lump sum payment of N3,491,479.50 (three million, four hundred and ninety one thousand, four hundred and seventy nine naira, fifty kobo) only being 30% (thirty percent) of the Judgment sum to be paid immediately upon granting of this order;
(ii) Thereafter equal monthly instalment of the sum of N678,898.90 (six hundred and seventy eight thousand, eight hundred and ninety eight naira, ninety kobo) only per month for the next 12 (twelve) months to liquidate the Judgment sum.
AND FOR SUCH FURTHER order and/or other orders as this Honourable court may deem fit to make in the circumstance”.
The grounds upon which this application is anchored are that:-
1. The Judgment Creditor/Respondent has appealed against the Ruling and Judgment of this court.
2. The parties are not in agreement of the actual calculation of the total sum of money payable as Judgment debt.
3. The Judgment Debtor/Applicant cannot afford to pay the Judgment sum and at the same time defend the appeal.
In support of the application is a 19 paragraphs affidavit with seven exhibits marked TA1 to TA7 attached. Also in support is a 9 paragraphs affidavit with a bundle of documents attached which is marked exhibit TA8. Both affidavits are deposed to by Taiwo Akinpelu, a Litigation Officer in Chief Rotimi Williams Chambers, Solicitors to the Judgment Debtor/Applicant.
In opposition to this motion, the Respondent filed a Counter Affidavit of nine paragraphs on 22/8/11 which is deposed to by Oluka Nwidaa, a Solicitor in Ezeobi and Company, a firm of Legal Practitioners for the Judgment Creditor/Respondent.
When this application came up for hearing on 7th February, 2012, the learned counsel for the Applicant moved the motion in terms and urged the court to grant the application.
In response, the learned senior counsel for the Respondent, Chief T.A. Ezeobi, SAN, leading other counsel, submitted that the Applicant herein, not having an appeal against the Judgment of this court which they seek a stay, cannot make an application for stay or instalmental payment, stating further that it is an abuse of court process. He relies on the case of Denton West v. Chief Muoma (2008) 6 N.W.L.R.(Pt.1083) 418 at 437 paragraph G to 439 paragraph B. He further contended that the Applicant ought to have applied at the court below except there are exceptional circumstances. He urged this court to dismiss this application.
In a brief rejoinder, the learned counsel for the Applicant E. O. Etomi (Mrs.), referred to Order 19 Rule 5 of the Rules of this court 2011 and the case of Kosofe Local Government v. Demore (2002) N.W.L.R. (Pt.131) 1861 at 1865 and submitted that by the Rules of this court, the Applicant is entitled to approach this court with this application. She urged this court to grant this application.
It is trite and well settled in many judicial authorities that where the Judgment of a court of competent jurisdiction is not manifestly illegal or wrong, the Court of Appeal would be correct to presume that the Judgment or order appealed against is correct or rightly made until the contrary is proved or established. See Nigerite Ltd. v. Dalami Nig. Ltd. (1992) 7 N.W.L.R. (Pt.253) 288; Denton West v. Muoma (2008) 6 N.W.L.R. (Pt.1083) 418; In Re-Diamond Bank Ltd. (2002) 17 N.W.L.R. (Pt.795) 120 at 134 G – H. Thus, this court will not ordinarily indulge in the practice of denying a successful litigant of the fruits of his success except under very special circumstances. See Vaswani Trading Company v. Savalakh & Co. (1972) 12 SC 77 at 81.

The Supreme Court has clearly stated the principles guiding the grant or refusal of stay of execution pending appeal. In Vaswani Trading Co. v. Savalakh (supra), the Apex Court held that the fundamental principle guiding the grant or refusal of an application for stay of execution of a Judgment pending the determination of an appeal against it is the existence of special circumstances. Such special circumstances would involve the consideration of some collateral circumstances, and in some cases inherent matters which may, unless the order for stay is granted, destroy the subject matter of the proceedings and foist upon the court, complete helplessness, or paralyze, in one way or the other, the exercise by the litigant of his constitutional right of appeal or generally provide a situation in which whatever happens to the case, and in particular even if the case succeeds in the Court of Appeal, there can be no return to the status quo. No stay of execution will be granted if to grant it might deprive the winner in the court below of the fruits of his victory. On the other hand, a stay of execution should not be refused if the effect of such refusal would render the appeal nugatory, if it should be eventually successful. It has been held that if the request for stay and the subject matter of the appeal have the same substratum so that the grant of one would dispose of the other, the stay of execution should be granted. See Okorodudu v. Deduwa (1974) 6 SC 21 at 25; Nigerite Ltd. v. Dalami Nig. Ltd. (supra).
In the instant application, the Applicant herein which is also the Judgment Debtor, has not filed any appeal against the Judgment it is praying should be stayed. It is the Judgment Creditor/Respondent which has filed an appeal. In other words, it can be safely concluded that the Applicant has accepted the Judgment of this court sought to be stayed. My reason for saying so is that it has not appealed or shown interest in appealing against the said Judgment. The reason may not be far-fetched. This court has varied the Judgment of the lower court in favour of the Applicant herein in the Judgment sought to be stayed. The learned senior counsel for the Respondent argued that this application is incompetent because the Applicant failed to first apply at the lower court in accordance with Order 7 Rule 4 of the Court of Appeal Rules 2011 before filing this application in this court. I do not think Order 7 Rule 4 of the Rules of this court applies to this present application. The Rule applies where an applicant applies to stay the Judgment of the lower court. The said Rule of this court requires that such an application be made first to the court below except where there are special circumstances which make it impossible or impracticable to apply to the court below. The Judgment in issue now is not the lower court’s Judgment but the Judgment of this court delivered on 4th February, 2010. Being the Judgment of this court, the Applicant need not apply to the lower court before coming here.
The reasons which the Applicant rely upon for the grant of stay or instalmental payment are contained in the affidavit in support of this application. The relevant paragraphs of the affidavit containing these facts are hereunder reproduced as follows:-
”3. I am informed by Mr. Otugbenga Awomolo the Executive Director of the Judgment Debtor/Applicant in our chambers at No.1. Shagamu Avenue, Ilupeiu, Lagos State at about 11:30am on 8th July, 2010 and I verily believe him as follows:-
(a) This Honourable Court delivered judgment in Appeal No.CA/L/414/2003 on the 4th February 2010 per their Lordships Adzira Gana Mshelia, Regina Obiageli Nwodo, Adamu Jauro, JJCA. A copy of the judgment is herewith attached and marked as Exhibit TA/1.
b) His Lordships Adzira Gana Mshelia, JCA made the following award at pages 28 to 29 of the Judgment:
“Award 1: N3,590,951.00 cost of material procured
Award 4: N246,368.00 cost of local material
Award 5: N45,942.00 cost of local labour
Award 6: N1,000,000.00 legal consultancy and counsel fees are here affirmed.
The total is to carry interest at 7’bd% per annum from 8/2/92 order by the court below until entire judgment debt is fully paid.
The lower court’s order on general damages and cost of N10,000.00 is also affirmed”.
4. From the calculation of the above Judgment debt the sum payable as at May, 2010 is N11,638,265.26.
5. The parties are not in agreement of the actual calculation of the total sum of money payable as Judgment debt. Attached herewith and marked as Exhibit TA/2 and TA/3 are correspondences between counsel.
6. The Judgment Debtor/Applicant is willing to pay the Judgment debt and intends to pay the Judgment
debt instalmentally.
7. The Judgment Debtor/Applicant has been facing financial hardship since the Global Financial Meltdown and the prevailing harsh economic climate.
8. The Applicant has not made profit for some time now due to the present economic climate. Attached here and marked as Exhibit TA/4 and TA/5 are the Applicant’s audited financial statements for the year 2004-2007 and 2008.
9. The 2009 audited financial statement has not been presented to the Board and Members of the company by the Applicant’s auditors,
10. The failure of the Judgment Debtor/Applicant to pay the judgment debt is not out of disrespect to this Honourable Court but due to its financial status.
11. The Judgment Debtor/Applicant undertakes to pay the entire Judgment sum in installmenfs in the manner proposed on the motion paper.
12. The Applicant will liquidate the Judgment sum in 12 monthly installments of N678,898.90 (six hundred and seventy-eight thousand, eight hundred and ninety-eight naira, ninety kobo) and one lump sum payment of N3,491,479.50 (three million, four hundred and ninety-one thousand, four hundred and seventy-nine naira, fifty kobo) only being 30% (thirty percent) of the Judgment sum if this Honourable Court grants this application for installmental payment as stated on the motion paper.
13. The Applicant will suffer grave consequences which may include but not limited to liquidation if it has to pay the Judgment sum in one lump sum especially going by the audited records.
14. That if the Appellant is liquidated on account of the Judgment debt, many people will lose their jobs with spiral social effect.
15. That this Honourable court has already awarded interest to the Judgment creditor until final liquidation of the Judgment sum, the Judgment Creditor is already protected.
16. The Judgment Creditor has instituted appeals against tie Ruti.pg and Judgment of the Honourable Court date 10th November, 2009 and 4th February, 2010 respectively. The Notices of Appeal dated 24th November, 2009 and 22nd March, 2010 are respectively marked as Exhibit TA/6 and TA/7″
Basically, the Applicant’s reasons as can be gleaned from his affidavit in support are that the Respondent herein has filed an appeal to the Supreme Court, that the amount payable is not certain and that the Applicant is willing to pay but that it is presently facing financial hardship. But, as was noted by the learned senior counsel for the Respondent, the Applicant, not having an appeal before this court, cannot apply for stay of execution merely on ground of impecuniosity. The Respondent’s appeal at the Supreme Court does not seek to reduce the amount awarded by court. Rather, it seeks to increase it. Since the Applicant in his affidavit has agreed to pay the Judgment sum, an appeal by the Respondent to the supreme court is not a good reason to ask for stay of execution.
On the issue that the sum payable is being disputed, I wish to state that it is not the duty of counsel to sit in the comfort of their chambers to calculate the amount of interest payable on the Judgment sum as has been done in this case. The Applicant’s counsel has calculated his figure and the learned senior counsel for the Respondent has also done his own figure. This is unacceptable. This is the duty of the Registry of this court though the parties are to be taken into confidence. It is not a good reason to refuse to pay the Judgment sum merely on a flimsy excuse that the interest payable is not certain. As far as I can glean from the Judgment of this court sought to be stayed, the Judgment sum is certain and the percentage of interest payable is also certain.

This is a monetary Judgment for which the court rarely grants a stay. Where a stay of execution is sought in respect of a monetary Judgment as in this case, the Applicant must come to equity with clean heads. He must make a full and frank disclosure. See S.P.D.C. Nig. Ltd. v. Okei (2007) 17 N.W.L.R. (Pt.1002) 1; Fasel Services Ltd. v. NPA (2001) 11 N.W.L.R. (Pt.723) 35; Denton West v. Muoma (supra).
In the instant case, there is really no reason to exercise this court’s discretion in favour of granting a stay of execution as the Applicant has failed to show that it deserves to be positively considered. Accordingly, the prayer for stay of execution is hereby refused.
The alternative prayer is for instalmental payment. It is the Applicant’s reason as contained in paragraphs 7 of the supporting affidavit that “the Applicant has been facing financial hardships since the Global Financial Meltdown and the prevailing harsh economic climate”. And in paragraph g thereof, the Applicant states that it has not been making profit as is supposed to be. The Applicant has proposed the payment of N3,491,479.50 lump sum and thereafter a monthly instalment of N678,898.90 until the Judgment sum is liquidated. In paragraph 6 of the said affidavit, the Applicant states his willingness to comply with the Judgment of this court but by instalments. The Applicant has annexed Exhibit TA5 which is the annual Reports and Accounts of the Applicant. In the counter affidavit of the Respondent, there is nothing to contradict the Applicant on its financial position. The balance of convenience in the circumstance is in favour of the Respondent for it is better to grant instalmental payment and allow the Respondent to stay alive than to refuse and thereafter it is extinct. This will not be in the interest of the economy and the workers of the Applicant who may lose their jobs in the circumstance of the Applicant going under. In granting the prayer for instalmental payment, the interest of the Judgment Creditor must be taken into consideration as this court will not ordinarily make a practice of denying a successful litigant of the fruits of his success unless under very special circumstances. See In Re-Diamond Bank Ltd. (2002) 17 N.W.L.R. (Pt.795) 120. In Exhibits TA2 and TA3, the Respondent states that the Judgment sum with interests amounts to N18,233,287.19 (eighteen million, two hundred and thirty three thousand, two hundred and eighty seven naira, nineteen kobo) as at 23/04/2011 while the Applicant says it is N11,638,265.26 (eleven million, six hundred and thirty eight thousand, two hundred and sixty five naira, twenty six kobo) respectively. I have already made a directive in this Judgment that it is the accountant in the Registry of this court that will calculate the interest in the presence of the parties or their counsel. It is my belief that if the Applicant is desirous of paying the Judgment sum as it has stated and affirmed in the affidavit in support of this motion, the Judgment sum could have been liquidated about February 2011 since the Judgment was delivered on 4th February, 2010 and the Applicant is asking for 12 months period to liquidate the amount. Be that as it may, I hereby grant instalmental payment of the Judgment sum with interest as will be calculated by the Registry of this court as follows:-
1. Applicant shall pay one lump sum of N7,000,000.00 (seven million naira) to the Respondent within 14 days with effect from today.
2. Thereafter, the Applicant shall pay N1,000,000.00 monthly instalment until the entire Judgment sum with interest is liquidated.
3. There shall be no order as to costs.
4. This application succeeds in part.

K.B. AKAAHS, J.C.A.: I agree with the lead ruling of my learned brother Okoro JCA.

RITA NOSAKHARE PEMU, J.C.A: I have had a preview of the Judgment just delivered by my brother John Inyang Okoro J.C.A and I agree with the reasoning and conclusions.
I also subscribe to the consequential order made inclusive that the application succeeds in part and there shall be no order as to costs.

Appearances

E. O. Etomi (Mrs.),
H. Bako (Miss)For Appellant

AND

Chief T.A. Ezeobi, SAN,
E. Odigwe (Miss)For Respondent