B. L. LIZARD SHIPPING COMPANY LIMITED v. MV “WESTERN STAR” & ORS (2014)

B. L. LIZARD SHIPPING COMPANY LIMITED v. MV “WESTERN STAR” & ORS

(2014)LCN/7580(CA)

In The Court of Appeal of Nigeria

On Tuesday, the 2nd day of December, 2014

CA/L/808/10

RATIO

COURT; POWER OF THE COURT; THE INHERENT POWER OF THE COURT

In Erisi vs. Idika (supra) @ 512. B-F. Nnamani, J.S.C. of blessed memory, inter alia, had this to say:
“…Inherent powers enure to a superior court of Record enabling it to make such orders or take such actions as will protect or enhance the dignity of the court, or promote the speedy or fair dispensation of justice. Lord Morris in Connelly vs. D.P.P. (1964) A.C. @ 1301, writing on the inherent jurisdiction of the court was of the view that a court which is endowed with a particular jurisdiction has powers which are necessary to enable it to act effectively within such jurisdiction, I would regard them as powers which are inherent in its jurisdiction. A court may enjoy such powers in order to enforce its rules of practice and to suppress any abuse of its process and to defeat any attempted thwarting of its powers.
The nature and essence of the inherent power of the court is further described in the case of OGWUEGBU vs. AGOMUO [1999) 7 NWLR (Pt.609) 144 @ 173
“The inherent power of the court is that power which is itself essential to the very existence of the court as an institution and to its ability to function as such institution…An inherent power has to be inherent in the sense that it forms an essential and intrinsic element in the whole process of adjudication. It is innate in a court, and is not a subject of specific grant by the Constitution or by legislation. That is why inherent powers of the court cannot be taken away or abridged by legislation, for he who gave, he only can take away. This explains Section 6(6)(a) of the 1979 Constitution which merely recognized and stated the obvious – that the inherent powers of a court of law exist “notwithstanding anything to the contrary in this Constitution for such powers were not granted by the Constitution. As soon as the court is established, all its inherent powers adhere and attach to it. Inherent powers of the court are therefore those powers that are reasonably necessary for the administration of justice in the court. It is the power which sticks in, clings to, or cleaves to a court by the very reason only of its being such a court”. per. U.I. NDUKWE-ANYANWU, J.C.A.

COURT: CONSEQUENTIAL ORDER; THE ESSENCE OF A CONSEQUENTIAL ORDER

Appellant submitted that the order given by the court was not prayed for. All orders don’t have to be prayed for specifically. The Respondent prayed for the money to be returned. However, the trial judge in his wisdom made a consequential order. This order is to give effect to a judgment or one directly traceable to or flowing from the judgment order duly prayed for.

“It is essentially one which would make the principal order effectual and effective or which necessarily follows as being incidental to the principal order. In other words, it is one which has a bearing with the main relief or reliefs claimed by a party. It is thus usually granted or made to give meaning and effect to the main relief or reliefs sought by a party. A consequential order can only relate to matters adjudicated upon”.
See Inakoju vs. Adeleke (2007) 4 NWLR Pt.1025 page 423, Liman vs. Mohammed (1999) 9 NWLR Pt.617 page 116.
Thus a consequential order is a necessary order flowing directly and naturally from, and inevitably, consequent upon the judgment already given. It, therefore, need not be claimed. See Liman v Mohammed (Supra) Momah v. Vab Petroleum Inc. (2000) 2 SC Pg. 142, A.G.F. vs. I.C. Ltd. (2000) 6 SC Pt.1 Pg. 175. From the above, it means that the Respondents did not specifically pray for the money to be deposited with the bank or court. However, the trial court is empowered to make consequential orders to give full meaning to its ruling and orders.
The trial judge was, therefore, right to have given the orders for the money to be deposited in court and paid into an interest yielding account. per. U.I. NDUKWE-ANYANWU, J.C.A.

JUSTICES

UZO I. NDUKWE-ANYANWU Justice of The Court of Appeal of Nigeria

SAMUEL CHUKWUDUMEBI OSEJI Justice of The Court of Appeal of Nigeria

ABIMBOLA OSARUGUE OBASEKI-ADEJUMO Justice of The Court of Appeal of Nigeria

Between

B. L. LIZARD SHIPPING COMPANY LIMITED Appellant(s)

AND

1. MV “WESTERN STAR”
2. EASTERN STAR SHIPPING COMPANY LIMITED (OWNERS OF THE MV “WESTERN STAR”)
3. MASTER OF THE MV “WESTERN STAR” Respondent(s)

U.I. NDUKWE-ANYANWU, J.C.A. (Delivering the Leading Judgment): This is an appeal against the Ruling of the Federal High Court, Lagos delivered on 9th day of June, 2010 which ordered that the value of the funds collected under the Bank Guarantee, be paid in to the court, in the care of the chief Registrar who will in turn pay same into an interest yielding account

In a nutshell, the fact of this case is that the Appellant, as Plaintiff, claimed against the Defendant/Respondent the following:

1. The sum of US$127,650 being the outstanding cost for the bunked supplied to the 1st Defendant by the Plaintiff;
2. Interest on the above sum at the rate of 2% per month from the 2nd of March, 2006 till judgment and thereafter at the rate of 10% per annum until the judgment debt, interests and costs are fully liquidated;
3. US$30,000 being the legal costs incurred by the Plaintiff in respect of this matter; and
4. A declaration that the beneficial ownership of the 1st Defendant vested in the 2nd Defendant, Eastern Star Shipping Company Limited.

The 1st Respondent was released from arrest by an order of court. The
said release of 1st Respondent was upon the Provision of a Bank Guarantee by the Respondents. The letter of undertaking contained, inter alia, this proviso.

“Any claim by the plaintiff on the Bank under this guarantee may only be made once a final judgment after appeals if any has been rendered by the Federal High court of Nigeria or any other higher court to which appeals may lie and shall be supported by a Certified True Copy of the Court Judgment or Order or, in case an agreement in writing is reached between the parties, an original version of the agreement, duly signed by both parties authorized representatives”

Pleadings were ordered and the matter proceeded to trial and judgment delivered on 3rd day of June, 2008. The Appellant thereafter on 27 June, 2008 applied and collected the Eco Bank Guarantee on 21, June, 2008 worth US$151,650. Unhappy with the turn of events, the Respondents filed a motion praying, inter alia, for the return of the money. In its considered Ruling, the trial Judge ordered the amount to be paid into the court, pending the determination of the appeal already filed.
The Appellant was dissatisfied with the said Ruling and thereafter filed its notice with three grounds of appeal. An Appellant’s brief was filed on 28 June, 2011 but deemed properly filed and served on 29th day of September, 2011. In it, the Appellant articulated three issues for determination. They are namely:-

“1. Whether it was open to the Respondents to challenge the Appellant’s right to reap the fruit of its judgment in the absence of any application for stay of execution of the judgment.
2. Whether the Respondents can validly prevent and/or challenge the enforcement of the terms of the Bank Guarantee.
3. Whether having regard to the facts of this case, the order directing the Appellant to pay the value of the fund under the Bank Guarantee into Court, being an order not sought by the Respondent was justifiably made.”

In response, the Respondent filed their brief on 21st day of October, 2013 but deemed properly filed on 18 June, 2014. The Respondents adopted the three issues articulated by the Appellant for determination.

ISSUE 1

The learned counsel to the Appellant submitted that the Respondent had sought for the return of the judgment sum paid to the Appellant. This order, counsel argued, acts as a stay of execution and denies the Appellant of the fruits of the judgment. See Osho vs. A.G. Ekiti State (2002) 2 NWLR Pt.752 Pg.628.

Counsel urged the court to resolve this issue in favour of the Appellant.

ISSUE 2

Counsel for the Appellant on this issue submitted that the Respondents cannot enforce a contract that it is not a party to. The Respondents are not parties to the contract of the Bank Guarantee. Counsel argued that the Bank Guarantee was entered into by the Appellant and the Bank. See Makwe vs. Nwukor (2001) 14 NWLR Pt.733 Pg 356. Counsel submitted that the Respondents are strangers to this contract and cannot sue on the terms of the Bank Guarantee. Furthermore the judgment of the lower court subsists until up turned on appeal. Therefore, in the absence of a stay of execution, the judgment can be executed. Udeh vs. Okoli (2009) 7 WLR Pt.1141 Pg. 571. The Regency Council of Olota vs. Sodeinde (1998) 6 NWLR Pt.552 Pg.72;

Counsel submitted further that the mere filing of an appeal does not operate as a stay of execution; the Appellant is entitled to the fruits of its judgment.

Counsel urged the court to resolve this issue on its behalf.

ISSUE 3

Learned counsel for the Appellant submitted that the order of the court that the Appellant should pay into the court the amount paid by the Bank was not a relief prayed for by the Respondent. The court must restrict itself to the claims and reliefs sought by the Respondents. See Amadi vs. Chinda (2009) 10 NWLR Pt 1148 Pg. 107.

RESPONDENTS ARGUMENTS

ISSUE 1

Learned counsel to the Respondent drew the court’s attention to the fact that this court had delivered a judgment against the main suit in appeal No CA/L/868/09 in Owner of M.V. Western Star & Ors vs. B.L. Lizard on 7th day of August, 2013 per Iyizoba JCA. Counsel submitted that there can also be no factual or legal basis for the Appellant’s current appeal and no legal basis for the Appellant to continue to hold on to the sum secured by the Bank Guarantee which Appellant wrongly collected from the Bank.

Counsel submitted that this appeal has been overtaken by events. The trial judge was right when she held that the application was not for a stay of execution of the court’s judgment but for an interpretation of the terms of the Bank Guarantee.

Counsel argued further that the Plaintiff/Appellant can only validly submit a claim under the Bank Guarantee upon a final judgment i.e appeals even to Supreme Court.

Counsel urged the court to hold that the trial judge was right in ordering the return of the Bank Guarantee.

ISSUE 2

Counsel submitted that the Bank Guarantee is for any of the parties who succeeds finally in the Appeals but the Appellant had now wrongly collected the money. The terms of the Bank Guarantee that the 2nd Respondent provided for stated as follows:

“This Guarantee shall take effect from the date of execution hereof and shall remain in force until the satisfaction of the Plaintiff’s claims arising from the final determination of the suit and/or any appeal arising therefrom”

The funds were lodged at the bank for the purpose of satisfying the Appellant’s claims arising from the final determination of the matter even if the matter went on appeal.

Counsel submitted that the Respondents derived their rights to the money from the fact that the Respondents provided the money for the Bank Guarantee.

The Respondents were not strangers to this contract as they provided the money for the Bank Guarantee for the release of 1st Respondent that was arrested. Counsel referred the court to The Third Party Contract Act of 1999 which gives a third party in a contract the right to sue to enforce the terms of the contract.

Counsel urged the court to hold that the Respondents have pecuniary interest in the Bank Guarantee it provided funds for.

ISSUE 3

Counsel submitted that the trial judge was right in holding and ordering the Appellant to return the money collected from the bank and pay same into the court. The Counsel referred the court to its prayers concerning the Bank Guarantee paid to the Appellant. The prayer is as follows:

“,,,’praying the court for an order compelling the Plaintiff to return the sum of US$151,650 or any amount it collected from Ecobank Plc pursuant to the Bank Guarantee issued by the Defendants through Ecobank Plc of Plot 27, Ahmadu Bello Way, Victoria Island Lagos (under the Letter of Undertaking dated 29th November, 2006 and delivered to the counsel to the Plaintiff as guarantee to pay the Plaintiff the sum of US151,650 plus interest and costs), and for such further order (s) as this Honourable Court may deem fit to make in the circumstances,”

Counsel argued that the important part of the prayer is for the Appellant to return the money collected by the Appellant. The Learned trial Judge ordered that the value of the fund collected under the Bank Guarantee, be paid to the court, in the care of the Chief Registrar, who will in turn pay same into an interest yielding account.

Also Counsel submitted that court have inherent powers to make orders that are deemed fit and just in any circumstances of a case.

We, therefore, submit that a court of law has inherent powers to impose its own conditions in granting any relief and is not bound to adopt word for word the prayer or terms sought by a party. We submit that the court in its wisdom can make any order which in its view would aid substantial justice in the matter. We submit that this is what the lower court did and it cannot be faulted. We urge my lords to so hold.

Counsel urged the court to hold that the court was right when it held that the Appellant should pay the money into court and resolve this issue on behalf of the Respondent.

RESOLUTION OF THE ISSUES

The sole issue in this appeal to my mind is whether, the trial Judge was right in making the orders against the Appellant. The order was for the Appellant to pay back the funds of the Bank Guarantee collected from the Bank even while there was a pending appeal.

I will, therefore, examine the terms of the Bank Guarantee. Part of the terms of the Bank Guarantee states as follows:

“Any claim by the Plaintiff on the bank under this guarantee may only be made once final judgment after appeals if any has been rendered by the Federal High Court of Nigeria or any other higher court to which appeals may lie and shall be supported by a Certified True Copy of the Court judgment or Order or, In case an agreement in writing is reached between the parties, an original version of the agreement duly signed by both parties authorized representatives”.

This term states that the money deposited as Bank Guarantee should be left in the Bank until the final judgment has been delivered.

The Appellant after the judgment of the trial court applied to the bank to release, the money. The money was released within 3 months of the judgment whilst the Respondents were still within time to file their notice and grounds of Appeal.

This term was breached by the Appellant, by applying for the money even before the statutory time within which a party can file his notice and grounds of appeal.

The trial court was, therefore, right to have ordered that the Appellant deposits the money into the court and the Chief Registrar will, in turn, deposit it into an interest yielding account to abide the outcome of the substantive appeal.

The Respondents drew the court’s attention to the substantive appeal on the suit in the High Court which has been determined in an Appeal in this court between MV “Western Star” and Ors vs. B. L. Lizard Shipping Company Ltd in CA/L/868/2009 delivered on 7th August, 2013.

This court, in that appeal, determined the issues in its judgment and allowed the appeal, and held that the lower court lacked the jurisdiction to entertain the suit in the trial court.

Therefore, there is really no basis for this appeal. This appeal ought to have been withdrawn and struck out. However, the Appellant still continued knowing fully well that this appeal is bereft of its foundation.

This appeal has become academic in all its ramifications and therefore lacks merit. It is hereby dismissed. The money paid by the 2nd Respondents for a Bank Guarantee, now collected by the Appellant, should be paid into the court for onward transmission to the owner of the money i.e 2nd Respondent.

Cost to the Respondents is assessed at N50,000

SAMUEL CHUKWUDUMEBI OSEJI, J.C.A.: My Lord U. l. NDUKWE-ANYANWU JCA afforded me the privilege of a prior perusal of the lead judgment just delivered.

I do agree with the reasoning and conclusion contained therein and I have nothing extra to add.

I hold that the appeal lacks merit and it is accordingly dismissed.

I abide by the consequential orders in the lead judgment including that of costs.

ABIMBOLA OBASEKI-ADEJUMO, J.C.A.: I have read in draft the judgment of my learned brother HON. JUSTICE U. I NDUKWE- ANYANWU, J.C.A. I agree with the reasoning and conclusion reached.
I wish to re-iterate that it is trite that a court cannot grant what a party has not sought, except for consequential orders which flow from the main order of the court. See POLY CARP ONUOHA V. GUADS MARK NIGERIA LTD (2006) LPELR-CA/A/12/2004.
The inviolable words of ONNOGHEN JSC, in the case of EZE v. GOV. OF ABIA STATE (2014) 14 NWLR (Pt.1426) 192 @ 218 is worthy of note where he stated thus:
“It is under the above general principle of law that another principle was developed or emerged; that of consequential relief which is a principle that enables a court of law to grant to a party a relief incidental to the main relief(s) and which was/were not claimed by the party in question. It is designed to enable the court do justice between the patties…”
Consequential Orders are meant to give effect to the judgment of a court, or one directly traceable that flows from the judgment. As such, the respondent need not pray that the amount be deposited in an interest yielding account, the court can grant such as a consequential order.

To this effect, the appeal is dismissed and I abide by the consequential orders made in the leading judgment.

Appearances

For Appellant

AND

For Respondent