CHIEF KENNETH GBAGI & ANOR v. CHIEF T. J. ONOMIGBO OKPOKO
(2013)LCN/5924(CA)
In The Court of Appeal of Nigeria
On Friday, the 15th day of February, 2013
CA/B/265/2009
RATIO
THE LAW ON THE ISSUE OF JURISDICTION
It is trite Law that the issue of jurisdiction can be raised at any time by a party even on appeal in the Supreme Court. See: Nonye V. Anyiche (2005) 2 NWLR (pt.910) 623; A.G. Lagos State V. Dosunmu (1989) 3 NWLR (pt.111) 552; Lufthansa Airlines V. Odiese (2006) 7 NWLR (pt. 978) 39. Per. SIDI DAUDA BAGE, J.C.A.
THE JURISDICTION OF THE FEDERAL HIGH COURT IN CIVIL CAUSES AND MATTERS ARISING FROM THE OPERATION OF THE COMPANIES AND ALLIED MATTERS
Section 251(1)(C) of the 1999 Constitution provides as follows:
Section 251(1)
“Notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in Civil Causes and Matters:
(C) arising from the operation of the Companies and Allied Matters Act or any other enactment replacing that Act or regulating the operation of Companies incorporated under the Companies and Allied Matters Act.”
The Provisions of Section 251(1)(C) of the Constitution of Federal Republic of Nigeria 1999, the interpretation thereto is already settled by the Supreme Court of Nigeria in the case of Tanarewa (Nig.) Ltd. V. Plastic Fair Ltd. (Supra) Cited and Solely relied upon by the learned Counsel to the Appellants. Under the Doctrine of Stare Decisis all other courts including this court are bound to follow and make the similar interpretation to those provisions. The Supreme Court at pp 375 – 376, paras B – C on the Extent and Scope of jurisdiction of the Federal High Court in relation to matters arising from the operations of the Companies and Allied Matters Act stated as follows: “By virtue of Section 251(1)(c) of the 1999 Constitution, notwithstanding anything to the contrary contained in the Constitution and in addition to such other jurisdiction as may be conferred upon it by on Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters arising from the operation of the Companies and Allied Matters Act or any other enactment replacing that Act or regulating operation of companies incorporated under the companies and Allied Matters Act. It is manifest from the foregoing provisions that jurisdiction will only vest in the Federal High court if the suit involves civil cause and matter arising from the operation of the Companies and Allied Matters Act or any other Act replacing that Act or regulating the operation of companies incorporated under the Companies and Allied Matters Act. The implication is that in an action involving regulating, running or management or control of companies, the Federal High Court would be vested with jurisdiction. Thus, an action could be maintained and entertained in matters affecting formation or winding-up of a company, memorandum and articles of association; shares and share-holding; appointment, removal or change or alteration of directors. It also includes appointment of receiver and his various obligations such as giving notice of his appointment, filing statement of accounts with the Corporate Affairs Commission as contained in various provisions of CAMA, particularly Sections 393, 996, 398 and 399. These provisions control the conduct of a receiver and any claim arising from d breach thereof or enforcing right thereunder will qualify as an action arising from the operation of the said Act or regulation. But where the dispute does not involve the control or administration of a company and deals with ordinary routine business of a company, a State High court, and not the Federal High Court, has jurisdiction to entertain and determine the matter. That is to say, any matter that can be decided without recourse to either the Companies and Allied Matters Act, or any enactment regulating operation of companies under the said Act belongs to a State High Court, University of Ilorin Teaching Hospital v. Akilo (2001) 4 NWLR (pt.703) 246; F.M.B.N. v. NDIC (1999) 2 NWLR (pt.591) 333; Ali v. CBN (1997) 4 NWLR (pt.498) 192; University of Abuja v. Ologe (1996) 4 NWLR (pt.445) 706; NIDB v. Fembo (Nig.) Ltd. (1997) 2 NWLR (pt.489) 543; Bi Zee Bee Hotels Ltd. v. Allied Bank of Nigeria Ltd. (1996) 8 NWLR (Pt.465) 176; 7-up Bottling co. Ltd. v. Abiola & Sons Bottling Co. Ltd. (1996) 7 NWLR (pt.463) 714; Jammal Steel Structures Ltd. v. ACB Ltd. (1973) 1 ALL NLR (pt.2) 208 referred to”. Per. SIDI DAUDA BAGE, J.C.A.
TEST OF FAIRNESS: THE POSITION OF THE LAW WHERE PLEADINGS HAVE BEEN JOINED IN A TRIAL
The law is already settled that once pleadings have been joined there is hearing to which the test of fairness under Section 36(1) of the 1999 Constitution of the Federal Republic of Nigeria may be applied. The Supreme Court, in giving effect to this position, earlier on a similar provision under Section 22(1) of the Constitution, in the case of A. U. Deduwa & Ors V. Emmanuel A. Okorodudu (1976) 9 & 10 SC 329 at pp.353 – 356, stated as follows: “We hold, first of all that it is immaterial whether or not a court has heard one party or both parties to a suit, or whether or not one party or the other willfully absented himself from the hearing or failed to give evidence, and that once a trial has commenced after issue has been joined on the pleadings, there is a hearing to which the test of fairness under section 22(1) of the Constitution may be applied ……” See also: A. Anyaoke & 3 Ors V. Dr. F. Adi (1985) 4 SC. (Pt.1) 213 at 221. Per. SIDI DAUDA BAGE, J.C.A.
COURT: THE DUTY OF COUNSEL TO KEEP THEMSELVES ABREAST OF THE BUSINESS OF THE COURT.
This Court in a more recent decision per Salami PCA, in M. F. Kent (W.A.) Limited V. Martchem Ind. Ltd (2000) 8 NWLR (Pt.669) 459 at 472 paras B – D, (cited) stated as follows: “Not only that it is equally incumbent on the litigant who failed to go to court after he had been duly intimated of the hearing date to enquire as to what took place in court when he was absent…It ceases to be the responsibility of court to seek for and serve a party who had been duly notified or were aware of a hearing date. The failure to attend court on that day and subsequent ones cannot be blamed on the other party. The Appellant and not the Respondent should bear the brunt of the default. This court again in Afouja Community Bank (Nig.) Ltd. V. Akpon (2003) FWLR (Pt.146) 909 at 920 – 927 (Cited) per Amaizu JCA (as he then was) at Paras G – H. Stated as follows: “It is trite that once the preliminaries of a case have been completed namely, a service of writ, entry of appearance, it is the duty of counsel to keep themselves abreast of the business of the court. A counsel therefore cannot be heard to complain that he was not aware of the date a case is fixed for hearing.” Per. SIDI DAUDA BAGE, J.C.A.
JUSTICES
SIDI DAUDA BAGE Justice of The Court of Appeal of Nigeria
AYOBODE OLUJIMI LOKULO-SODIPE Justice of The Court of Appeal of Nigeria
TOM SHAIBU YAKUBU Justice of The Court of Appeal of Nigeria
Between
1. CHIEF KENNETH GBAGI
2. GEEKOS INVESTMENT LIMITED Appellant(s)
AND
CHIEF T. J. ONOMIGBO OKPOKO Respondent(s)
SIDI DAUDA BAGE, J.C.A. (Delivering the Leading Judgment): This is an Appeal against the decision of the Ughelli High Court, Delta State as contained in the Ruling of OHWO J. delivered on the 5th of February, 2009 in an application brought by the Applicants (as Applicants therein) for an order to set aside the default Judgment of the Warri High Court (Coram MAKWE J.) that default Judgment was given mainly because the Appellants (as Defendants) did not file their Statement of Defence.
The Appellants after so many attempts filed an application on the 17th of November, 2008 to set aside the said Judgment. The application and the Supporting affidavits and exhibits are on pages 86 to 95 of the Record of Appeal. It was argued on the 28th of January, 2009. The proceedings in respect thereof are on pages 116 – 117 of the Record of Appeal. The Ruling of the Court in respect thereof which is now being appealed against is on pages 143 to 158 of the Record of Appeal. The Notice of Appeal upon which this appeal is predicated is the Notice of Appeal filed and dated 27th January, 2010 – amended pursuant to the Court order of 12th January ,2010 which raises 4 Grounds of Appeal.
The Summary of the Facts of this case is as follows:
The Respondent, as Plaintiff in the lower Court, filed an action against the Appellants (as Defendants) seeking, in the main:
“an order of specific Performance that the Defendants do transfer to the Plaintiff all the shares held in their names in the books of NEM Insurance PLC as at 23rd November, 2000 upon Plaintiff depositing with the Registrar of this Honourable Court, a Bank Draft drawn in favour of either the 1st or 2nd Defendant in the sum of N4,437,984.00.”
The Respondent sought other reliefs in the alternative. The Writ of Summons and Statement of Claim showing those reliefs are contained on pages 1 to 6 of the Record of Appeal. The Appellants entered conditional appearance as shown on page 22 of the Record of Appeal and filed a Notice of Preliminary Objection dated and filed 10/12/07 as shown on pages 23 to 26 of the Record of Appeal, querying inter alia, the jurisdiction of the Court to entertain the suit on account of the fact that the subject-matter of the suit has to do with the transfer of shares of a Company registered under the Companies and Allied Matter Act which Company was not even a party to the suit. The Respondent (Plaintiff) responded by filing an application for default judgment dated 11th January, 2008. It is on pages 27 to 33 of the Record of Appeal. In the meantime, unknown to the Appellants, the said Notice of Preliminary Objection had been of struck out on 10th January, 2008 when the matter came up. As far as the Appellant (Defendants) could tell, there was no hearing notice on them for the hearing of that Notice of Preliminary Objection. The lower Court heard the application of the Respondent for default judgment and granted same on 26th February, 2008. The Appellants filed a number of applications to set aside the default judgment which applications were not moved and struck out. In the meantime, the matter was transferred from Warri Judicial division where the Applicant’s application dated 17th November, 2008 to set aside the default judgment of 26th February, 2008 was finally heard and determined by OHWO J. who refused the said application.
In the said application (pages 86 to 95 of the Record of Appeal) the Appellants had complained in their paragraphs 6 and 7 of their Affidavit in support that they never received a hearing notice for the hearing of their Notice of preliminary Objection. The Appellants exhibited their proposed Statement of Defence which also had a Counter-Claim. (See pages 89 to 90 of the Record of Appeal). This was to show that the Appellants not only had a good defence to the suit, but that they even had a Counter-Claim against the Respondent. The Appellants also stated in that affidavit that they were challenging the jurisdiction of the Court in limine. (See paragraph 9 of the Affidavit in Support on page 88 of the Record of Appeal).
Arising from the grounds contained in the Amended Notice of Appeal, the Appellants formulated the following issues for the determination of this Court.
(1) Whether or not the lower Court should have considered this issue of jurisdiction even suo motu in deciding whether or not to set aside the default judgment.
(Ground one)
(2) Whether or not the lower Court exercised its discretion properly in the Circumstances of the case especially in the light of the Complaint that the Notice of Preliminary Objection was determined more or less exparte. (Grounds 2 & 3)
(3) Whether or not the Appellant had proper notice of the hearing of the Motion for judgment dated 11th January, 2008.
(4) If the answer to (c) above is in the negative, whether or not it was proper for the lower Court to have refused to set aside the default judgment made without hearing the other party.
(Ground four)
On the other hand, the Respondent’s brief of argument dated the 10th of April, 2010 and filed on the 27th of April 2010, but deemed properly filed on the 9th of May 2012, and settled by one Chief T. E. Uwhubetine formulated the following three (3) issues from the Grounds of Appeal for the determination of the Court. They are as follows:
(i) Were the Appellants entitled to the exercise of discretion of the learned Trial Judge to set aside the default judgment having regard to Appellant’s application to set aside the default judgment and the materials placed before the Court?
(Ground 1)
(ii) Did the learned trial judge misdirect himself in law in his consideration and determination of the application to set aside the default judgment of Makwe J.?
(Ground 2)
(iii) Was the order made by Makwe J. striking out Appellants’ notice of preliminary objection in issue before the learned trial Judge? And even if so was that a relevant consideration in Appellants’ application to set aside the default judgment.
(Grounds 3 & 4).
From the set of issues as formulated from either side, it is to be seen that, parties have proliferated them, which becomes unnecessary for the management of the appeal. A sober look at the Appellants set of issues, four (4) in number, it can be made just two (2) for the easy management of the appeal as follows:
1. Whether or not the lower Court should have considered the issue of Jurisdiction, even Suo motu in deciding whether or not to set aside the default judgment, and whether it exercised its discretion properly in the light of the complaint that the Notice of Preliminary Objection was determined more or less exparte.
2. Whether or not the Appellant had proper notice of hearing of the motion for judgment dated 11th January, 2008, if the answer is in the negative, whether or not it was proper for the lower Court to have refused to set aside the default judgment made without hearing the other party.
From the Respondent’s set of issues, three (3) in number, two (2) would emerge for the easy management of the appeal as follows:
1. Were the Appellants entitled to the exercise of discretion of the learned trial Judge to set aside the default judgment having regard to Appellants’ application to set aside the default judgment and the materials placed before the Court?
2. Did the learned trial judge misdirect himself in law in his Consideration and determination of the application to set aside the default judgment, and the order striking out Appellants Notice of Preliminary Objection both by Makwe J., and whether there was any relevant consideration in the Appellants application to set aside the default judgment?
In arguing issue one (1), learned Counsel to the Appellants submitted that, the ventilation of the issue of jurisdiction raised even at the stage when the Appellants applied to set aside the default judgment was cogent enough to make the lower Court tread with caution in allowing the default judgment to go unchecked. The Appellant did not only raise it in their Affidavit in support of their motion to set aside the Judgment, they exhibited a Statement of Defence and Counter-Claim which copiously stated that the subject matter of the suit was not within the jurisdiction of the Ughelli High Court.
It is trite Law that the issue of jurisdiction can be raised at any time by a party even on appeal in the Supreme Court. See: Nonye V. Anyiche (2005) 2 NWLR (pt.910) 623; A.G. Lagos State V. Dosunmu (1989) 3 NWLR (pt.111) 552; Lufthansa Airlines V. Odiese (2006) 7 NWLR (pt. 978) 39. It was therefore wrong of the court not to have considered the issue of jurisdiction at all. We also refer to the Statement of Claim on this issue of jurisdiction. No alternative relief can be considered either in the absence of jurisdiction.
Learned Counsel further submitted that the Warri and Ughelli High Courts do not have jurisdiction at all to entertain the Suit. This is because the main reliefs and order are on issues concerning the operation of the Companies and Allied Matters Act 2004. Specially Section 250 (1)(C) of the 1999 Constitution of the Federal Republic of Nigeria. The facts show that the Respondent wants the State High Court to Compel the Appellants to transfer shares to him. Now the issue of the transfer of shares has a procedure under the Companies & Allied Act 2004. It is specially covered by Section 151-157 of the Companies and Allied Matters Act (CAMA) that must be followed. This brings this matter under the purview of the operation of CAMA, it is the procedure that can be done by a Court order. See: Section 250 (1) (C) of the 1999 Constitution which vests exclusive jurisdiction on the Federal High Court. See: Tanarewa (Nig.) Ltd. V. Plastic Fair Ltd (2003) 14 NWLR (pt. 840) 353 at 375 – 376.
In reply, the learned Counsel to the Respondent submitted that, the ruling complained of in this appeal arose from the motion on notice filed by Appellants. A careful perusal of appellants motion and affidavit show that the applicants ground for seeking to set aside the judgment as a default judgment is that the Judgment was given in the absence of 1st Appellant who claimed he was away on a business trip overseas. Therefore, to explain his absence on the date the Judgment was given, 1st Appellant attached photocopy of what he called “pages of my passport”. Absence of the 1st Appellant was the only ground put forward by Appellants as basis for the default which led to the default judgment sought to be set aside. Appellants did not say a word about the 2nd Appellant which cannot possibly go on a business trip overseas. The learned trial Judge heard the argument of the parties and after a thorough consideration of the application, he came to the conclusion that this application is misconceived and it is dismissed with cost. This is a judgment predicated on default of pleadings as distinct from default of appearance.
Learned Counsel submitted further that an applicant seeking to set aside a judgment given against him in default of a defence must at the very least explain the reason for failure to file defence. See: Williams V. Hope Rising Voluntary Society (1982) All WLR (Report) 1, at 6 – 7; Gbere V. Alli Owe (2000) 11 NWLR (pt.678) 294 at 306.7; Etokhana V. Progress Bank of Nigeria Plc (1997) 10 NWLR (pt.525) 616 at 625.
Learned Counsel further submitted that the Appellant filed an affidavit of 13 paragraphs and a further affidavit of 8 paragraphs at pages 87 -88 and 91-92 of the record of appeal respectively.
Appellant did not in any of the paragraphs of their said affidavit give any reason or explanation for their failure to file their Statement of Defence as by law provided.
Learned Counsel further submitted that the application to set aside the default judgment was predicated on two legs (1) that the judgment entered against Appellants was in default of appearance (21 That at the time this Court entered the default judgment, Appellants notice of preliminary objection was pending.
However, the record of the Court will show that as at 26/2/2008 when default judgment was entered, the Court had made an order on the 10th of January 2008, which is on page 44 – 45 of the record. At page 45, the learned trial Judge ordered that the Defendant/Applicants are absent, their Counsel is also absent. The application was struck out with N5,000:00 costs in favour of the Plaintiff. This order makes it clear that at the time of default judgment, the preliminary objection was no longer pending.
Learned Counsel submitted further that the Appellants have shown no valid basis in law on which the trial Judge could have considered the application to set aside the default judgment on the basis that the High Court of Delta State had no jurisdiction in the matter.
Learned Counsel further submitted that what is between the parties is a breach of contract pleaded in paragraphs 10, 11 & 12 of the Statement of Claim. These pleadings show clearly that the cause of action is clearly on a contract to sell and buy shares of a Company which Defendants claim to hold. The relief sought is an order of specific performance of the contractual obligation which Appellants owed the Respondent. In no circumstance, can a contract between Appellants and Respondent to sell and buy shares held by Appellants amounts to the issue of company management of NEM Insurance PLC. The Respondent’s claim before the Court did not in any way border on the operation of any company under the Companies & Allied Matters Act. The jurisdiction conferred on the Federal High Court by S.251 of the Constitution did not include jurisdiction to hear and determine contract between parties involving sale or purchase of shares of companies. See Jammal Steel Structures Ltd. V. African Continental Bank Ltd. (1973) All NLR 852 at 865, Onuora V. KRPC Ltd. (2005) 6 NWLR (pt.921) 393 at 405 paras A – D; Adelekan V. ECU Line NV. (2006) All FWLR (pt.321) 1213 at 1226 paras E – F; Integrated Timber & Plywood Products Ltd. V. UBN PLC (2006) All FWLR (pt.324) 1789 at 1803 – 1804 paras G – H.
The Appellant had raised a jurisdictional issue in his argument to the issue number one (1). He relied on the fact that, the main reliefs and order on issues concerned the operation of the Companies and Allied Matter Act 2004, which field is covered by Section 250(1)(C) of the 1999 Constitution of the Federal Republic of Nigeria. According to the Appellants, the facts show that the Respondent wants the State High Court to compel the Appellants to transfer shares to him, which by the provisions of Section 250(1)(C) of the 1999 Constitution of the Federal Republic of Nigeria, such jurisdiction is vested exclusively on the Federal High Court. The Appellants in support of this position placed reliance in the Supreme Court’s decision in Tamarewo (Nig.) Ltd. V. Plastic Fair Ltd, (Supra)
Learned Counsel to the Respondent maintained that, the jurisdiction conferred on the Federal High Court by Section 251 of the Constitution did not include jurisdiction to hear and determine contract between parties involving sale or purchase of shares of companies. Learned Counsel placed reliance on plethora of authorities earlier on stated in his argument.
The jurisdiction of the Federal High Court under the 1999 Constitution of the Federal Republic of Nigeria, is to be found as correctly cited by the learned Counsel to the Respondent under Section 251, and not Section 250 as erroneously cited by Counsel to the Appellants.
Section 251(1)(C) of the 1999 Constitution provides as follows:
Section 251(1)
“Notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in Civil Causes and Matters:
(C) arising from the operation of the Companies and Allied Matters Act or any other enactment replacing that Act or regulating the operation of Companies incorporated under the Companies and Allied Matters Act.”
The Provisions of Section 251(1)(C) of the Constitution of Federal Republic of Nigeria 1999, the interpretation thereto is already settled by the Supreme Court of Nigeria in the case of Tanarewa (Nig.) Ltd. V. Plastic Fair Ltd. (Supra) Cited and Solely relied upon by the learned Counsel to the Appellants. Under the Doctrine of Stare Decisis all other courts including this court are bound to follow and make the similar interpretation to those provisions. The Supreme Court at pp 375 – 376, paras B – C on the Extent and Scope of jurisdiction of the Federal High Court in relation to matters arising from the operations of the Companies and Allied Matters Act stated as follows:
“By virtue of Section 251(1)(c) of the 1999 Constitution, notwithstanding anything to the contrary contained in the Constitution and in addition to such other jurisdiction as may be conferred upon it by on Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters arising from the operation of the Companies and Allied Matters Act or any other enactment replacing that Act or regulating operation of companies incorporated under the companies and Allied Matters Act. It is manifest from the foregoing provisions that jurisdiction will only vest in the Federal High court if the suit involves civil cause and matter arising from the operation of the Companies and Allied Matters Act or any other Act replacing that Act or regulating the operation of companies incorporated under the Companies and Allied Matters Act. The implication is that in an action involving regulating, running or management or control of companies, the Federal High Court would be vested with jurisdiction. Thus, an action could be maintained and entertained in matters affecting formation or winding-up of a company, memorandum and articles of association; shares and share-holding; appointment, removal or change or alteration of directors. It also includes appointment of receiver and his various obligations such as giving notice of his appointment, filing statement of accounts with the Corporate Affairs Commission as contained in various provisions of CAMA, particularly Sections 393, 996, 398 and 399. These provisions control the conduct of a receiver and any claim arising from d breach thereof or enforcing right thereunder will qualify as an action arising from the operation of the said Act or regulation. But where the dispute does not involve the control or administration of a company and deals with ordinary routine business of a company, a State High court, and not the Federal High Court, has jurisdiction to entertain and determine the matter. That is to say, any matter that can be decided without recourse to either the Companies and Allied Matters Act, or any enactment regulating operation of companies under the said Act belongs to a State High Court, University of Ilorin Teaching Hospital v. Akilo (2001) 4 NWLR (pt.703) 246; F.M.B.N. v. NDIC (1999) 2 NWLR (pt.591) 333; Ali v. CBN (1997) 4 NWLR (pt.498) 192; University of Abuja v. Ologe (1996) 4 NWLR (pt.445) 706; NIDB v. Fembo (Nig.) Ltd. (1997) 2 NWLR (pt.489) 543; Bi Zee Bee Hotels Ltd. v. Allied Bank of Nigeria Ltd. (1996) 8 NWLR (Pt.465) 176; 7-up Bottling co. Ltd. v. Abiola & Sons Bottling Co. Ltd. (1996) 7 NWLR (pt.463) 714; Jammal Steel Structures Ltd. v. ACB Ltd. (1973) 1 ALL NLR (pt.2) 208 referred to.]
It is thus clear from the interpretation of the apex Court to those provisions, that the jurisdiction of the Federal High Court in civil causes and matters arising from the operation of the Companies and Allied Matters would include actions involving regulating, running or management or control of Companies. Thus, an action could be maintained and entertained by the Federal High Court affecting formation or winding-up of a company, memorandum and articles of association; shares and share-holding; appointment, removal or change or alteration of directors. It also includes appointment of receiver and his various obligations such as giving notice of his appointment, filing statements of accounts with the Corporate Affairs Commission as contained in various provisions of CAMA, particularly Sections 393,396,398 and 399. These provisions control the conduct of a receiver and any claim arising from a breach thereof or enforcing right thereunder will qualify as action arising from the operation of the said Act or regulation. It is very clear that, the Supreme Court is referring to the operations of a Company incorporated under the Companies and Allied Matters Act. The shares and share holding herein refers to the shares and share holding of that company. What if the company in the course of its business goes to acquire the shares of another company, the apex Court answered this question immediately in this same case of Tanarewa (Nig.) Ltd, (Supra). It stated that where the dispute does not involve the control or administration of company and deals with ordinary routine business of a company, a State High Court, and not the Federal High Court has jurisdiction to entertain and determine the matter. In order to determine whether it is the Federal or State High Court that has jurisdiction in the instant matter, it becomes apposite to examine the Statement of Claim particularly paragraphs 3, 4, 5, 10, 11 & 12 thereof of the Appellant/Respondent.
Paragraph 3:
“1st Defendant is the owner of the 2nd Defendant. He is the beneficial owner of all the shares of the 2nd defendant and the Sole Signatory to the Company’s bank accounts in some banks. Defendants are owners of Woodbridge Hotel at P.T.I. Junction on the Express Rood by-pass in Effurun.
Paragraph 4:
By letter dated 2nd November, 2000, 1st Defendant offered to sell to the Plaintiff, a total of 13,750.880 shares of NEM Insurance PLC held directly by him and 2nd Defendant, his company, at a total price of N7,562,984.00. Plaintiff may rely on the said offer letter.
Paragraph 5:
Plaintiff accepted the said offer and made a part payment of USD$25,000 (N3,125.000.00) leaving a balance of N4,437,984. The total purchase price of the said 13,750,880 shares NEM Insurance Plc was based on the quoted market price of 55 kobo per shares as at date of contract.
Paragraph 10:
Since his letter dated 31/1/2003, Plaintiff has by telephone calls and personal messages, mutual acquaintances called for the parties to meet so that transfer forms and the original share certificates and a bank draft for the balance of the purchase price can be exchanged at the same time, but appointments were never kept by Defendants.
Paragraph 11:
As a last resort, Plaintiff by letter dated 21st August, 2007 written to the 1st Defendant, set out three options for concluding the transaction through stock brokers and sent a copy thereof to a mutual friend – Chief Albert Akpomudje – SAN. Defendants did not respond to the letter.
Paragraph 12:
At a meeting between Plaintiff and 1st Defendant brokered by Chief Akpomudje, SAN on Sunday, the 11th November, 2007 at his office in Warri, 1st Defendant declared finally that Defendants have no intention of transferring a single share to Plaintiff and that Plaintiff can go to Court, if he likes, Defendants having finally refused to transfer the said 13,750,880 shares of NEM Insurance Plc or any part thereof to the Plaintiff, Plaintiff therefore commenced this action.
From the paragraphs above, it is very clear that the claim of the Respondent then as Plaintiff was in relation to a contract entered with the 1st Appellant then as 1st Respondent for the sale of the shares of NEM Insurance Plc a distinct Company from the 2nd Appellant (Geekos Investments Limited). The 1st Appellant is the alter ego of the 2nd Appellant. By the interpretation given by the Supreme Court in Tanarewa (Nig.) Ltd (Supra). It is the shares and share holding of Geekos Investments, 2nd plaintiff, owned by the 1st plaintiff, a company incorporated under the Companies and Allied Matters Act, that the Constitution vested the jurisdiction on the Federal High Court. The issue of sale of shares of NEM Insurance owned by the Appellant to the Respondent which is a distinct company deals with ordinary routine business of a company. Even where such shares is acquired in the name of 2nd Appellant (Geekos Investments Ltd.), it is the State High Court, and not the Federal High Court that has jurisdiction to entertain and determine such matters. In the instant appeal therefore, the lower Court was absolutely right to have assumed jurisdiction on the matter. The Federal High Court has nothing totally to do with the contract of the sale of shares of NEM Insurance between the parties. Having established that the lower Court was right to have assumed jurisdiction in this matter, the Court will now turn its attention to the second leg of this issue. The contention of the Appellants here is that, no proper hearing notice of the motion for Judgment dated 11th January 2008, was served on them, and thus it was only proper for the lower Court to set aside the default Judgment made without notice served, but it refused to set it aside. The point that is made here is that the motion itself was admittedly served on the Appellants Counsel with a date written on it. However it was further argued that it was risky on the part of the trial judge to have relied on the date written on the motion paper as sufficient notice to the parties. Hearing notice ought to have been issued from the Court to intimate the parties that the application was up for hearing.
The Respondent did not agree that in addition to the date stated in the motion for Judgment or other Court processes duly served on the Appellants there ought to have been a further hearing notice of same motion or processes. The suggestion of the Appellants is a novel one, without any foundation in law. The motion for Judgment set out at page 31 of the records of appeal clearly gave Appellants notice that the Court will be moved on 28th February, 2008 for the order sought. Appellants have not cited any authority for their novel suggestion that they are entitled to any separate notice of the said motion.
The grouse of the Appellants here is not to effect of not been on notice of the date the motion was fixed for hearing, a date was provided in the motion duly served on them. In addition, that the trial Court ought to cause a separate hearing notice of that date. With respect to that submission, this is not correct and does not represent the position of the law. The law is already settled that once pleadings have been joined there is hearing to which the test of fairness under Section 36(1) of the 1999 Constitution of the Federal Republic of Nigeria may be applied. The Supreme Court, in giving effect to this position, earlier on a similar provision under Section 22(1) of the Constitution, in the case of A. U. Deduwa & Ors V. Emmanuel A. Okorodudu (1976) 9 & 10 SC 329 at pp.353 – 356, stated as follows:
“We hold, first of all that it is immaterial whether or not a court has heard one party or both parties to a suit, or whether or not one party or the other willfully absented himself from the hearing or failed to give evidence, and that once a trial has commenced after issue has been joined on the pleadings, there is a hearing to which the test of fairness under section 22(1) of the Constitution may be applied ……”
See also: A. Anyaoke & 3 Ors V. Dr. F. Adi (1985) 4 SC. (Pt.1) 213 at 221.
This Court in a more recent decision per Salami PCA, in M. F. Kent (W.A.) Limited V. Martchem Ind. Ltd (2000) 8 NWLR (Pt.669) 459 at 472 paras B – D, (cited) stated as follows:
“Not only that it is equally incumbent on the litigant who failed to go to court after he had been duly intimated of the hearing date to enquire as to what took place in court when he was absent…It ceases to be the responsibility of court to seek for and serve a party who had been duly notified or were aware of a hearing date. The failure to attend court on that day and subsequent ones cannot be blamed on the other party. The Appellant and not the Respondent should bear the brunt of the default.
This court again in Afouja Community Bank (Nig.) Ltd. V. Akpon (2003) FWLR (Pt.146) 909 at 920 – 927 (Cited) per Amaizu JCA (as he then was) at Paras G – H. Stated as follows:
“It is trite that once the preliminaries of a case have been completed namely, a service of writ, entry of appearance, it is the duty of counsel to keep themselves abreast of the business of the court. A counsel therefore cannot be heard to complain that he was not aware of the date a case is fixed for hearing.”
The Law is already stated, the Appellants in the instant appeal are not, and cannot be entitled to a separate hearing notice from court, after being duly served with one on the motion paper. This leg of issue is also resolved against Appellants. The long and short of this is that both legs 1 and 2, of Issue No.1 are resolved against Appellants and in favour of Respondent, Issue 1 resolved against Appellants and in favour of the Respondent.
On Issue No. 2 to wit whether the learned trial Judge misdirected himself in law in his consideration and determination of the application to set aside the default Judgment and the order striking out Appellants’ Notice of Preliminary Objection both by Makwe J., and whether there was any relevant consideration in the Appellants’ application to set aside the default Judgment.
Learned Counsel to the Appellants in his argument submitted that, it is the law that in an application to set aside a default Judgment the affidavit in support must state facts showing a defence on the merit and in principle a copy of the proposed Statement of Defence is usually attached to the affidavit as an Exhibit. This is exactly what happened in this case. On pages 89 to 90 of the Record of Appeal can be found the proposed Statement of Defence of the Appellants which contains the defence of the Appellants particularly the issue as to jurisdiction. This very issue is the gravanmen of the Notice of Preliminary Objection which was struck out without a notice of hearing to the Appellants. The Ughelli High Court failed to see this point in its Ruling. The learned trial Judge kept harping on the fact that the Notice of Preliminary Objection had been struck out before the default Judgment was given. The Court did not appreciate the point that on the day when the objection was heard the Appellants were not present because there was no notice to them.
Learned Counsel further submitted that even though it is the law that the Court will not wait for a party who is duly served with court processes and fails to show up, the Court can only hear such a matter when it is satisfied that parties to the case were duly served with hearing notices. See:- Nyamatient Ltd V. NDIC (2006) ALL FWLR (Pt. 293) 356; Tubonemi V. Dikibo (2006) 5 NWLR (pt 974) 565; Idiala V. Ejeko (2005) 11 NWLR (Pt. 936) 349; Mark V. Eke (2004) 5 NWLR (pt.865) 54; Onadeko V. UBN (2005) 1 NWLR (pt. 916) 440.
In reply the learned counsel to the Respondent submitted that, the Appellants’ submission that in refusing the application to set aside the default Judgment, the learned trial Judge was “being too technical” is totally untenable in law and on the facts. The relevant consideration as to whether to grant or refuse an application to set aside a default Judgment is well set out by the learned trial Judge in his Ruling dismissing Appellants’ application at page 148 of the records.
Learned Counsel to the Respondent further submitted that, the reference to an annexed purported Statement of Defence is unvailing. The annexture is not a defence to the claim in Court. If jurisdiction was in issue before Ohwo J. the learned trial Judge could have determined such issue by reference to the Statement of Claim and certainly not by reference to any Statement of Defence. Also notice of preliminary objection did not come up before Ohwo J. at the High Court at Ughelli. A notice of preliminary objection struck out at the High Court in Warri before the case was transferred to Ohwo J. at the High Court in Ughelli ceased to have any life for justice Ohwo to consider at Ughelli. The motion for Judgment was heard and granted by Makwe J. at the High Court in Warri. The Motion for Judgment did not come up before High Court at Ughelli and no such motion was heard or determined by Ohwo J. at Ughelli.
Learned Counsel to the Respondent further submitted that the learned trial Judge could not therefore be faulted for having relied on the date of the said motion as sufficient. Hearing notice of the default Judgment is not in issue in this appeal which is a complaint against the ruling dismissing Appellants’ application to set aside the default Judgment. This appeal is against the Ruling of Ohwo J. and not the default Judgment delivered by Makwe J. at High Court in Warri. Nullity or otherwise of the default Judgment was not in issue before the learned trial Judge who delivered the Ruling against which Appellants have appealed in this case. The suggestion that Ohwo J. ought to have set aside the default Judgment on the ground that Appellants were not served a separate hearing notice in addition to the date stated in the motion is untenable.
Learned Counsel to the Respondent further submitted that the Appellants have not shown that the learned trial Judge misdirected himself in his consideration and determination of the motion to set aside the default Judgment. The propriety or otherwise of Order made by Makwe J. striking out the notice of Preliminary Objection was not in issue in the proceedings before Ohwo J. at the High Court at Ughelli.
The controversies in the appeal is already brought to a narrow margin. In the determination of Issue No. 1 this Court has settled the issue of the hearing notice on the motion for default Judgment before Makwe J. The notice on the said motion paper was found to be sufficient notice to the Appellants to appear before that Court. The Court at Warri had no business to cause another hearing notice to appear before it by the Appellants who were duly notified.
What remains now is the Appellants application to set aside the default Judgment given by Makwe J. at Warri, before another Judge now Ohwo J. sitting at Ughelli. The Appellants had argued that the learned trial Judge at Ughelli misdirected himself when he refused to grant application, to set aside the default Judgment, when it was argued that such Judgment was defective having being obtained without hearing notices to the Appellants. The trial Court in its ruling of the 5th of February, 2009 on page 143 of the record of appeal, but more particularly pages 147, 148 & 149 stated as follows:
“Now, the Judgment given by the Court on 26th February 2008 was a default judgment. The Judgment was clearly headed as such. My learned brother had this to say:
“In default of pleading judgment is hereby entered in favour of the Plaintiff…
So the judgment was in default of pleadings not default of appearance. The principle of law obviously is that unless and until court has pronounced a judgment upon the merit or by consent, it is to have the power to revoke the expression of its coercive power when that has only been obtained by a failure to follow any of the rules of procedure and in the present case the rule of procedure to file o statement of defence. What then are the relevant considerations upon which the court relies in dealing whether or not to grant an application to set aside its judgment given in default of defence? The relevant considerations are these:
1. The reason for the default in filing the defence.
2. Whether there has been undue delay in making the application so as to prejudice the respondent;
3. Whether the respondent would be prejudiced or embarrassed upon an order for rehearing being made so as to render it inequitable to permit the case to be re-opened and;
4. Whether the applicants’ case is manifestly unsupportable.
See Williams v. Hope Rising Voluntary Funds Society (1982) 1 – 2 S.C. 745 cited by Plaintiff. See also Ogolo v. Ogolo (2006) 140 LRCN 2011 at 2023 to 2024 relied upon by learned Counsel for the Defendants/Applicants, All the relevant considerations just listed must be resolved in favour of an Applicant to set aside a default judgment before the Court can so set aside the judgment.
I have perused the two affidavits filed by the Defendants in respect of this application. I shall have cause to run through each paragraph of the affidavit shortly, but let me say here and now that I cannot find anywhere the Defendants gave reasons why they failed to file a statement of defence in the action leading to the default judgment. Though the Defendant exhibited a proposed statement of Defence and counter claim in their application it was deposed in paragraph 11 of the affidavit in support that the proposed statement of defence and counter-claim is to show the Defendants have a “solid defence” in the event of their preliminary objective which I said was struck out far back 10th January 2008 “fail”. The whole affidavit as will be seen shortly is on default of appearance of the Defendants and the issue of service of hearing notice. Having failed to give any good and satisfactory reason for the default in filing the defence, the Defendants cannot be granted the indulgence of this court. The setting aside of a default judgment is not a matter of cause but that upon which the court will exercise its discretion judicially and judiciously upon the facts placed before it by the applicant and in this case the Defendants. On that ground, this application ought to be refused.”
The learned trial Judge stated correctly the position of the law on the subject of default of pleadings. He has to the satisfaction of this court, exercised his discretion, both judiciously and judicially. This Court will not disturb the decision of the trial Court on this subject. Issue No. 2 is resolved against the Appellants and in favour of the Respondent. And having resolved the two (2) Issues in this appeal against the Appellants and in favour of Respondent, this appeal is devoid of any merit, it fails, it is hereby dismissed.
The Ruling of Hon. Justice F. O. Ohwo, of the High Court of Justice, Delta State in Suit No. W/197/2007, in the Ughelli Judicial Division, delivered on the 5th day of February, 2009, is hereby affirmed by this Court.
Costs is assessed at N50,000.00 in favour of the Respondent against the Appellants.
AYOBODE OLUJIMI LOKULO-SODIPE, J.C.A.: I have read in advance the lead judgment of my learned brother, SIDI DAUDA BAGE, JCA. I am in full agreement with the reasoning and conclusion reached therein that the appeal is devoid of any merit.
In the circumstance, I adopt the lead judgment as mine, and I too dismiss the appeal. Consequently, I affirm the ruling of the lower court delivered on 5/2/2009, in Suit No.W/197/2007. I also abide by the order relating to costs made in the lead judgment.
TOM SHAIBU YAKUBU, J.C.A.: I read the draft of the judgment just delivered by learned brother SIDI DAUDA BAGE, JCA. I am satisfied with the reasoning and conclusion contained therein. I have nothing more useful to add to it because his Lordship exhaustively and meticulously dealt with all the issues which arose in the appeal.
I, therefore dismiss the appeal, for lacking in merit. I affirm the ruling of the Delta State High Court in Suit No.W/197/2007 delivered on 5th February, 2009 by F. O. OHWO, J.
I also award N50,000.00 costs in favour of the respondent.
Appearances
Olarewaju OsinaikeFor Appellant
AND
T. E. Uwhubetine with T.G. Pinnick (Miss)For Respondent
