- C. ENYE V. KEVIN OGBU
In The Court of Appeal of Nigeria
On Tuesday, the 16th day of April, 2002
Before Their Lordships
EUGENE CHUKWUEMEKA UBAEZONUJustice of The Court of Appeal of Nigeria
SULE AREMU OLAGUNJUJustice of The Court of Appeal of Nigeria
JUSTIN AFOLABI FABIYIJustice of The Court of Appeal of Nigeria
- C. ENYEAppellant(s)
OLAGUNJU, J.C.A.: (Delivering the Leading Judgment): The appeal is from the decision of Okoli, J., of the Anambra State High Court who entered judgment for the respondent as the plaintiff against the appellant qua the defendant for the sum of N161,192 with 5% interest on the judgment debt under the summary procedure of the undefended list.
The claims arose from the shortage incurred by the appellant from the stock of goods put in her charge as a saleslady by the respondent who employed her and who deposed that he supplied her with the goods on 19 separate invoices listed in the affidavit verifying his claims. He deposed in elucidation that the shortage was discovered by his auditor who on 5/10/99 made a preliminary check of the stock from three books of account in use by the appellant, viz, sales-book, stock-book and credit-book that revealed a shortage of N200,000 worth of goods. That the final audit report issued on 18/10/99 shows a loss of N1,535,587 on sales made by the appellant between 5/5/99 and 5/10/99 and that from that amount the sum of N1,374,395 made up of ‘company expenses, salary and value of goods remaining in stock’ over the same period was discounted revealing that ‘the actual loss occasioned by the defendant’s negligence or bad faith is N161,192.00’.
That is the summary of the material facts verified by the affidavit on which the writ of summons for placement on the undefended list was issued endorsed with a hearing date copy of which was served on the appellant in due course. The appellant did not file notice of Intention to defend the action as stipulated by sub-rule 9(2) of Order 24 of the Anambra State High Court Rules, 1988, and at the hearing the learned trial Judge, at page 12 of the record, held as follows:
“The affidavit of service in the case file shows the defendant was duly served the writ and the affidavit in
support. By virtue of the provisions of Order 24 rule 9 High Court Rules the court has no alternative than to enter judgment for the plaintiff without calling on the plaintiff to prove his case. See Agueze v. Pan African Bank Ltd. Accordingly, judgment is hereby entered in favour of the plaintiff against the defendant for the sum of N 161,192.00 being value of goods sold and delivered by the plaintiff to the defendant. There will be interest on the judgment debt at the rate of 5% per annum from the date of judgment until payment is fully made.” (Italics mine)
Dissatisfied with the judgment the appellant is challenging that decision on three grounds of appeal from which she formulated in her brief of argument the following two issues for determination:
“2.1 Whether from the affidavit evidence and all the materials placed before the court the learned trial Judge was right in hearing and determine this suit under the undefended list procedure?
2.2 Did the leaned trial Judge exercise his discretion judicially and judiciously taking into consideration the nature, facts and circumstances of this case?”
In his brief of argument the respondent adopted the issues formulated by the appellant. On the first limb of issue one, learned counsel for the appellant contended that the respondent’s action is not maintainable under the undefended list originating process because, firstly, it is not an action for recovery of debt or liquidated money demand; rather, it is an action in tort of negligence. He referred to the definition of the word ‘debt’ in Akinnuli v. Odugbesan (1992) 8 NWLR (Pt. 258) 172, 188, and to the expression ‘liquidated money demand’ as defined in Nortex (Nigeria) Ltd. v. Franc Tools Co. Ltd (1997) 4 NWLR (Pt. 501) 603, 610-611; and S.B.N. Plc. v. Kyentu (1998) 2 NWLR (Pt. 536) 41, 56. He further referred to Odume v. Nnachi (1964) All NLR 324, 328, that drew a distinction between liquidated and unliquidated demands. Secondly, that the respondent’s claim as deposed to in the supporting affidavit does not disclose a prima facie case that could warrant its being placed on the undefended list for not only is the respondent not sure of the amount of the alleged shortage that oscillated between the sums of N200,000 in the primary audit report and N161,192 in the final audit report but also the affidavit setting out the claim does not contain the statutory declaration of brief that the appellant has no defence to the action.
Thirdly, that the respondent’s action is incomplete because the 19 invoices through which the goods are alleged to be supplied to the appellant and the sales-book, stock-book and credit-book which the affidavit was using to operate the stock were not exhibited to the affidavit. Fourthly, that exhibit ‘A’, the service agreement between the parties, laid down the rules governing the appellant’s employment and nothing more while the audit report made up of exhibit ‘C’ signed by the Auditor and exhibit ‘D’, the breakdown figures of the items in stock and their value signed by the respondent, are ‘mathematical contraption specifically made for this suit’; moreso, as the auditing and the stock-taking were made in the absence of the appellant.
The learned counsel cited a host of judicial authorities to support his contention that the respondent’s action cannot be maintained under the undefended list with the requirements laid down which the respondent’s action did not conform to. Those which are strictly relevant to the summary procedure of the undefended list variant include: Macaulay v. NAL Merchant Bank Ltd. (1990)4 NWLR(Pt. 144) 283, 307; Himma Merchants Ltd. v. Aliyu (1994) 5 NWLR (Pt.347) 667, (1994) 8 NACR 73; NAB (Nig.) Ltd. v. Felly Keme (Nig.) Ltd. (1995) 4 NWLR (Pt. 387) 100, 144; Okeke v. NICON Hotels Ltd. (1999) 1NWLR (Pt. 586) 216, 222; and Grand Cereals & Oil Mills Ltd. v. As-Ahel International Marketing & Procurement Ltd. (2000) 4 NWLR (Pt. 652) 310, 326. Winding up on this point the learned counsel submitted that a plaintiff who out of the desire to obtain a cheap and quick judgment decides to cloth or mark an otherwise contentious matter as an undefended should not be directly or indirectly, assisted by the court to achieve his aim citing in support of the proposition Muobike v. Nwigwe (2000) 1 NWLR (Pt. 642) 620,638.
On the second limb of his submission the learned counsel took to task the learned trial Judge’s stand on failure of the appellant to file notice of intention to defend which he made the centre-piece of his decision to enter judgment for the respondent. He contended that failure of the appellant, qua the defendant, to file notice of intention to defend does not relieve the court of its duty to consider whether the suit is one suitable to be placed on the undefended list as he is enjoined to do by virtue of rules 14 and 15 of Order 5 and sub-rules (2), (3) and (4) of Order 24 stressing, in particular, sub-rule 9(5) thereof that vests the court with enormous discretion in that regard. He submitted that as this court held in Pwol v. Union Bank Plc. (1999) 1 NWLR (Pt. 588) 631, 635, “a defence is only necessary in a suit commenced under the undefended list procedure where the plaintiff’s case as disclosed by his affidavit has established a primafacie case against the defendant necessitating such a defence.
A defence is therefore unnecessary in a suit under the undefended list procedure where the plaintiff’s affidavit shows that his case is unsustainable”. In aid of that proposition of the law he referred further to Okeke v. NICON Hotels Ltd. (supra), at page 222, and Kola v. Taibu (2001) 4 NWLR (Pt. 702) 200, 216. On that note, he rests his submissions on issue one and urged this court to resolve that issue in favour of the appellant.
Apart from explanation about what caused the difference between the sums of N200,000 and N161,192 given in different parts of the claim as the amount of loss sustained by the appellant the reply by learned counsel for the respondent to the points raised on behalf of the appellant is, in the main, off the point. The learned counsel hangs on to the twig of exhibit’ A’, the service agreement between the appellant and the respondent, which he contended serves dual purposes, viz. It is in essence a contract of uberrimea fidei under which the appellant is liable for any loss occasioned by her negligence or bad faith; and it is also the type of agreement that is an exception to the general rule that an undefended list procedure cannot be used to recover a claim in tort.
Rambling on the learned counsel referred to a number of authorities on the relationship between employer and employee contending that the writ of summons initiating the respondent’s action and the supporting affidavit and the exhibits annexed thereto have established a prima facie case to warrant the suit to be tried under the undefended list. He digressed, unintelligibly, to canvass the duty of the trial court to evaluate evidence and the exceptional circumstances when the appellate court would do so. He contended that inasmuch as the appellant did not challenge paragraphs 4 -11of the respondent’s affidavit it was open to the court to act on the unchallenged evidence on the precedent of Nzeribe v. Dave Engineering Co. Ltd. (1994) 8NWLR (Pt.361) 124, (1994) 9 SCNJ 161, 172 – 173. This, he argued, the learned trial Judge did by awarding to the respondent ‘the legally recoverable loss’ of N161,192 arising from the appellant’s breach of her contract with the respondent.
As a corollary of the argument that exhibit ‘A’ is an exception to the general rule that an undefended list procedure cannot be used to seek a relief in tort the learned counsel who acknowledged the definition of the expressions ‘debt’ and ‘liquidated money demand’ in Akinnuli v. Odugbesan (supra), and Odume v. Nnachi (supra), nonetheless, submitted that the award of N161,192 to the respondent is based on the respondent’s uncontradicted evidence. He contended that the decision is supported by the Privy Council’s decision in Boshali v. Allied Commercial Exporters Ltd. (1961) 2 SCNLR 322, (1961) All NLR 917, because of failure of the appellant to file notice of intention to defend the action which is fatal to the appellant’s case. He urged the court to resolve positively issue one in favour of the respondent and to dismiss the appeal.
The desultory and myopic argument of learned counsel for the respondent has only one purpose in focus, justification of the judgment of the court below at all costs. Such style of advocacy is self-serving and inimical to the development of law as setting blinkers across the vision of justice in what, judging from the widespread misconception about the applicable principle, is becoming the grey area of the law. What is in issue is far more important than whether the court below is right. Rather, the issue at stake is to identify the correct principles of law in summary procedure of the undefended list that can guard against the pitfalls in the conduct of trial originated by that process.
Against this background let it be said for the umpteeth time that undefended list summary procedure is lately becoming troublesome. The exceptional problems which appear to be peculiar to the application of the joint ambit of rule 14 of Order 5 and rule 9 of Order 24 of the Anambra State High Court Rules, 1988, which are the main provisions controlling the undefended list procedure have been examined at some length in the recent unreported decisions of this court in Brifina Ltd. v. Intercontinental Bank Ltd. (2003) 5 NWLR (Pt.814) 540 and Chrisdon Industrial Co. Ltd. v. African International Bank Ltd. (2002) 8 NWLR (Pt.768) 152, delivered on 20/2/2002 & 14/3/2002, respectively. I do not need to reopen any doctrinal argument on the matter. It will be enough to say that although under rule 14 of Order 5 no power is expressly reserved for the court to scrutinise a writ of summons before it is placed on the undefended list yet the omission cannot derogate from the power of the court under sections 135 – 137 of the Evidence Act to determine as a pre-condition whether the plaintiff’s verifying affidavit supporting application for a writ of summons disclosed a prima facie case to justify the case being placed on the undefended list. Since placement on the undefended list under rule 14 of Order 5 is done on the declaration of the plaintiff that the defendant has no defence to the action scrutiny by the court is a primary duty that must first be attended to at the hearing of the action.
In that way hearing of an action placed on the undefended list under rule 14 of Order 5 of the Anambra State High Court Rules, 1988, requires two steps that are common to the procedure under the undefended list all over except that where the rule of court expressly empowered the court to do so the undefended list must first be taken before the placement of the suit. The primary duty must first be discharged by the trial court in the sense that where a suit does not satisfy the test that it is a proper action to be placed on the undefended list the suit must automatically be transferred to the general cause list for full-dress hearing so that question of whether notice of intention to defend the action was filed does not arise. In other words, a trial court cannot jump the gun by skipping the primary duty of determining whether an action is a proper one to be placed on the undefended list an exercise which is essentially a judicial decision: see Nwakama v. Iko Local Government of Cross-River State (1996) 3 NWLR (Pt. 439) 732, 739; and Maley v. Isah (2000) 5 NWLR (pt. 658) 651, 664. These are the principles that must be applied to the facts of the case under review.
From the decision of the court below reproduced in the early part of this judgment it is clear that the learned trial Judge did not invoke his undefended list jurisdiction of considering whether the respondent’s suit is a proper one to be placed on the undefended list. He has by so doing skipped the basic judicial duty and his decision is by that fatal omission vitiated for which see Maley v. Isah (supra); and Baba v. Habib Nigeria Bank Ltd. (2001) 7 NWLR CPt.712) 496, 504. That will be sufficient to dispose of this appeal.
But in view of a number of points raised on the criteria for placing a suit on the undefended list it will not be fair to rest a decision in this appeal on such a narrow consideration. Thus the essential process must be critically examined.
The respondent’s action was based on shortage of stock of goods in the appellant’s custody due to negligence or bad faith. The respondent in paragraphs 5 & 6 of his affidavit verifying his loss deposed to 19 invoices through which the goods were supplied to the appellant and three books of account used by the appellant for the disposal of the stock. No copies of those invoices or the three books of account were exhibited to the affidavit. In paragraph 7 of the affidavit the respondent deposed that at the hearing he would rely on those books. But neither of the three books nor the 19 invoices were produced at the trial. Indeed, in the nature of action on the undefended list where the decision whether to place the action on the undefended list is based on the claim as crystallised when the application for a writ of summons was made no additional document can be filed in addition to those that accompanied the application and on which decision about placement was made.
In a regular trial based on pleadings the deposition in those three paragraphs may be accepted as sufficient averments in a statement of claim that put the defendant on notice of the allegations by the plaintiff in a con where the defendant has the right to ask for further and better particulars and to deliver interrogatories. But the undefended list procedure is a closed-end affair where evidence that would be required to establish a case must be filed with the application for a writ of summons for placement on the undefended list. This is clear from rule 14 of Order 5 of the Anambra State High Court Rules, 1988, which reads;
“Whenever application is made 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 registrar shall enter the suit in what shall be called the ‘undefended list”‘.
From the respondent’s claim as set forth in his affidavit a number of issues are raised. Firstly, there is no means of proving the actual amount of shortage of stock where the invoices on which the goods were supplied and the account books by which the unascertainable stock were operated were not made available.
Secondly, the unascertainable stock of goods is not a ‘debt’ within the definition of that word in Akinnuli v. Odugbesan (supra), at page 188, as ‘what one owes to another, what one becomes liable to do or suffer; a state of obligation or indebtedness; a duty’. Nor is it a liquidated money demand’ defined in the same decision as ‘an ascertained amount or an amount settled by the agreements of the parties’. The interpretation by learned counsel for the respondent that attempted to stretch the phrase ‘shall be liable to (sic) any loss occasioned by … negligence or bad faith’ in clause (h) of exhibit ,A’, the service agreement, to come within the definition of a liquidated money demand is a bit strained. Thirdly, rule 14 of Order 5 stipulates that affidavit verifying the plaintiff’s claim must contain a declaration that in the deponent’s brief there is no defence to the claim. No such declaration is contained in the respondent’s 13 paragraph affidavit to satisfy that statutory requirement.
Fourthly, the amount of shortage for which the appellant was held liable by the respondent was said to be N200,000. According to the letter of the respondent’s counsel dated 7/10/99, exhibit ‘B’ to the verifying affidavit, and paragraph 6 of the affidavit. That figure was later corrected to the sum of N161,192 in paragraph 11 of the affidavit. There is no evidence of the error which is not reflected in the final audit report annexed to the affidavit as exhibit ‘C’ and the preliminary audit report from which the error is said to have originated was not produced by the respondent who relied on his own computation, exhibit ‘D’, which, judging from paragraphs 9, 10 & 11 of the affidavit, is his own review of the final audit report, Exhibit C, and another audit report on ‘company expenses, salary and value of goods remaining in stock’ the contents of which were not made available in the application for a writ of summons.
What emerged from the affidavit evidence about which the above reservations are made is a claim under the summary procedure of the undefended list based on allegation against an employee of the shortage by negligence or one incurred in bad faith in which the means of ascertaining the actual amount of loss are not made available by the claimant and where the monetary value of the shortage oscillates between two amounts the reconciliation of which is not reflected in the only audit report made available but one known only to the claimant. In the particulars of claim verified by affidavit conspicuously absent is the statutorily enjoined declaration of belief by the plaintiff/respondent that the defendant/appellant had no defence to the action.
Match the affidavit evidence produced by the respondent as reviewed above against the requirements stipulated by rule 14 of Order 5 of the Anambra State High Court Rules, 1988, for placing a claim on the undefended list by no stretch of the imagination can the claim set out in the respondent’s affidavit that is riddled by evidential gaps be regarded as satisfying the requisite condition of being non-contentious that is basic to an action to be placed on the undefended list. Indeed, placing the respondent’s action on the undefended list is a misadventure occasioned by the lax conditions stipulated by rule 14 of Order 5 the litmus test of which the claim has miserably failed given a diligent scrutiny of the claim by the registrar of the court below. Thus, in sum, from examination of the affidavit evidence by the respondent filed in support of his application for a writ of summons that is punctuated by controversial facts the conclusion is inescapable that the action ought not to be placed on the undefended list in the first place.
That leads me to the question of whether failure of the appellant as the defendant to file notice of intention to defend concludes the action in favour of the plaintiff which was agitated by learned counsel on both sides. The answer depends on whether the primary duty to scrutinise whether the case is a proper one to be placed on the undefended list was discharged by the learned trial Judge. An affirmative answer to that inquiry predicates the conclusion that the plaintiff’s claim disclosed a primafacie case which the defendant is called upon to answer. In that case, failure of the defendant to file notice of intention to defend is deemed to be a tacit admission by the defendant of the plaintiff’s case and that entitles the plaintiff to judgment as of right.
Conversely, where the court failed or neglected to discharge the primary duty of ascertaining whether the plaintiff’s action disclosed a prima facie case to warrant its being placed on the undefended list the remiss in duty is fraught with the consequence that the Judge lacks the competence to hear the action and if the Judge tried the action based on failure of the defendant to file the statutory notice the trial would be a nullity as by so doing he would have shifted the burden of proof to the defendant to defend an action that has not been shown to disclose a prima facie case to warrant the defendant being called upon to defend. The corollary of failure to discharge the primary duty and proceeding in spite of the failure to hear the case may be a breach of fundamental right of the defendant as calling upon the defendant to defend a shadowy action is a denial of the right of fair hearing. To that extent learned counsel for the appellant is right that failure of the appellant to file notice of intention to defend does not relieve the learned trial Judge of the judicial duty to consider whether the action is one that should be placed on the undefended list.
In the result the learned trial Judge having goofed about his primary duty issue one is resolved against the respondent.
Issue two on whether the learned trial Judge exercised his discretion judicially and judiciously is a spill-over of issue one the substance of which has been canvassed in issue one. The contention by learned counsel for the respondent that the learned trial Judge exercised his discretion judicially and judiciously by giving judgment for the respondent because of failure of the appellant to file a notice of intention to defend which he submitted ‘has the colouration of … admission of the claim’ is a sheer embellishment of outworn argument deployed in issue one that has been found to be off-beat. The argument does not change that fact that the learned trial Judge left undone what he ought to have done. It is an unedifying nonfeasance that cannot be elevated to proper exercise of discretion by the best of sugar-coated advocacy. Therefore, I will also resolve issue two against the respondent.
Finally, it behoves me to point out two slipshod but material mistakes on the part of the learned trial Judge. First, according to the proceeding of 16/10/2000 on page 11 of the record the case was adjourned to 2/11/2000 for hearing. But hearing was held on 6/11/2000, page 12 of the record, without the record of what happened on 2/11/2000 and whether the case was in fact fixed for hearing on 6/11/2000. In Olubusola Stores v. Standard Bank Nigeria Ltd., (1975) 4 SC 51, 56-57, the Supreme Court emphasised the importance of hearing of an action on the undefended list only on the date fixed for hearing and the reason for a strict interpretation of the Rules governing the summary procedure of the undefended list. See also the decision of this court in Ezwna v. Nkwo Market Community Bank Ltd. (2000) 10 NWLR (Pt.676) 638, 656. Secondly, in his judgment, on page 12 of the record, the learned trial Judge said that he entered judgment ‘in favour of the plaintiff against the defendant for the sum of N161,192.00 being value of goods sold and delivered by plaintiff to the defendant’. It is not part of the plaintiff’s case that he sold goods to the defendant; the evidence is that he gave the goods in custody to the defendant as his employee for sale implying that title to the goods was still in the respondent and, therefore, question of sale and delivery of the goods did not arise. The judgment is at variance with the evidence, a defect that is alone sufficient to vitiate the judgment.
However that may be, the appeal succeeds on the two issues canvassed and it is allowed. I set aside the judgment of Okoli, J., of the Onitsha Judicial Division of the Anambra State High Court delivered on 6/11/2000. It is hereby ordered that the case be transferred to the general cause list and to be heard by another Judge of the same Judicial Division other than Okoli, J. I award N5,000 costs against the respondent.
UBAEZONU, J.C.A.: As I have said in a number of my judgments, lead and contributory, the summary proceedings of undefended list cause have caused more ‘problems to the courts than they were expected to cause. The problems stem from the fact that some of the courts of first instance are too ready to rush to judgment as soon as they see a suit placed on the undefended list. It must be realised that placing a suit on the undefended list is a mere administrative act of the Registrar of the court acting under Order 5 rule 14 of the High Court Rules of Anambra State, 1988. The other rules of court that deal with undefended list cause are Order 9 rule 2 and more importantly Order 24 rule 9. The provisions of these rules must be followed strictly before a court enters judgment in a suit in the undefended list.
As regards the case in this appeal, and indeed in every other case of an undefended list claim, the first and foremost matter in respect of which a trial court should satisfy itself is that the claim concerns “a claim to recover a debt or liquidated money demands.
If the claim is not, then it shall not be entertained under an undefended list procedure. In the case in this appeal, the case concerns a sum of money said to be a “loss occasioned by the defendant’s negligence or bad faith”. The facts further show that the claim arises out of an audit report which at one stage showed a loss of N 1,374,395 and at another stage showed a shortage of N200,000 and finally ended up at N161,192. The appellant in no where acknowledged that he was indebted to the respondent in any of the above sums of money or at all. The claim says that the amount arose out of the appellant’s “negligence or bad faith”. That smacks of a tort. The undefended list cause does not envisage a claim for damages in tort. By no stretch of imagination could the claim in this appeal be maintained under the undefended list cause.
I have said it many times and 1 say it again, courts of first instance should not be in a hurry to enter judgments in undefended list causes. They should examine the claim side by side with the rules under a claim in the undefended list before making up their mind whether the case is rightly a case maintainable under the undefended list cause. I shall refer to only one of my several judgments in this regard vis my contributory judgment in Muobike v. Nwigwe (2000) 1NWLR (Pt. 642) 620 at 638 – 640. I shall not repeat here what 1 said in the said judgment.
For the above reasons and the more detailed reasons given in the lead judgment by my learned brother, Olagunju, JCA, I agree that this appeal should be allowed. I also allow the appeal. I make the same consequential orders as are made in the lead judgment.
FABIYI, J.C.A.: I had a preview of the lead judgment just handed out by my learned brother – Olagunju, JCA. I agree that the appeal should be allowed.
D.C. MaduechesiFor Appellant
Jezie EkejiubaFor Respondent