DEC OIL & GAS LTD v. UBA BANK (2021)

DEC OIL & GAS LTD v. UBA BANK

(2021)LCN/14961(CA)

In The Court Of Appeal

(PORT HARCOURT JUDICIAL DIVISION)

On Monday, January 04, 2021

CA/PH/631/2014

RATIO

LIMITATION LAW: MEANING OF STATUTE BARRED

LIMITATION LAW: EFFECT OF A STATUTE BARRED ACTION

It is the law that where a statute provides for the bringing of action within a prescribed period, proceedings shall not be brought after the time prescribed by the statute has expired. See Obiefuna v Okoye (1991)1 All NLR 374; Eboigbe v NNPC (1994)5 NWLR (Pt. 437)649. PER ISAIAH OLUFEMI AKEJU, J.C.A.

PLEADINGS: RULES GUIDING THE APPLICATION FOR AMENDMENT OF PLEADINGS

On the application for amendment of pleadings, it is entirely at the discretion of the Court subject only to the fact that the power must be exercised judicially and judiciously. It may be granted at any stage of the proceedings and must be with the aim of eliciting all the issues in the matter without overreaching the other party. See Ogidi V. Egba (1999)10 NWLR (Pt. 621)42. It is also well established that an appellate Court will ordinarily not interfere with the exercise of discretion by a lower Court. An appellant who challenges the exercise of discretion by the lower Court must satisfy the Court that the discretion was not exercised judicially and judiciously. See Minister P.M.R V. El (Nig) Ltd (2010)12 NWLR (Pt. 1208) 261. PER ISAIAH OLUFEMI AKEJU, J.C.A.

Before Our Lordships:

Isaiah Olufemi Akeju Justice of the Court of Appeal

Cordelia Ifeoma Jombo-Ofo Justice of the Court of Appeal

Abubakar Muazu Lamido Justice of the Court of Appeal

Between

DEC OIL AND GAS LIMITED APPELANT(S)

And

UNITED BANK FOR AFRICA PLC RESPONDENT(S)

ISAIAH OLUFEMI AKEJU, J.C.A. (Delivering the Leading Judgment): This appeal is against the Ruling of the High Court of Rivers State delivered on 18th July 2013 in Suit No. PHC/1179/2009 in which Suit the Respondent herein was the Claimant while the Appellant was the Defendant. The Respondent had by the Writ of Summons and Statement of Claim originating the action claimed thus:
a. The sum of N1,365,985,820.76 (One Billion, Three Hundred and Sixty-five Million, Nine Hundred and Eighty-five Thousand, Eight Hundred and Twenty naira Seventy-six kobo) being the balance of defendant’s indebtedness to the Claimant as at 30th June, 2003.
b. Interest at the rate of 28% per annum from 1st July, 2003 till judgment.
c. Interest at the rate of 10% from date of judgment till judgment debt is fully liquidated.
d. Cost of this action.

The Defendant (now appellant) filed a statement of Defence and Counter Claim and both parties filed their written Statement on Oath as well as list of documents relied upon.

By the motion on notice filed by the Defendant/Appellant on 12/4/2013, the lower Court was approached for an order seeking to dismiss the

Suit for want of jurisdiction on the ground that the action was statute barred. The facts on which the applicant relied were stated in the grounds in support of the motion while the Claimant/Respondent filed a Counter affidavit to state that the indebtedness of the defendant was still alive.

The Claimant also filed a Motion on Notice on 17/5/2013 seeking to amend the Statement of Claim. The application for dismissal of Claim was refused while the application for amendment of Statement of Claim was granted.

Dissatisfied with the decision of the lower Court, the defendant filed Notice of appeal dated 24th July, 2013 with three grounds of appeal.

In the Appellant’s Brief of Argument settled by Kingsley K. Iheme Esq., and filed on 11/11/14, the issues formulated for determination in this appeal are the following:
1. Whether from the Writ of Summons and Statement of Claim filed on 30/6/09 this Suit is not statute barred.
2. Whether the proposed Amendment attached to the motion on Notice filed on 17/5/13 by the Respondent for leave to amend the Statement of Claim revalidated this Suit. The Respondent submitted in the Respondent’s

Brief that the sole issue for determination is whether the grant of the amendment of the Statement of Claim by the learned trial Judge has not revalidated this Suit filed on 30/6/2009.

The two issues formulated by the Appellant which I find to be more comprehensive are adopted for the purpose of consideration and determination of the appeal.

On issue one, the learned Counsel for appellant submitted that the lower Court was wrong to have dismissed the appellant’s application and granted that of the Respondent while holding that the cause of action in the Suit did not accrue in 2003 but sometime in 2005 or thereabout 2006 after new terms and conditions were entered into by the negotiating parties resulting in the reduction of interest rate from twenty-eight percent (28%) to nineteen percent (19%) which is now the basis of the relief sought by the Claimant.

It was contended that the Suit is incompetent having been statute barred from the pleadings filed on 30/6/09 and Section 16 of the Limitation Law of Rivers State having been commenced after five years of accrual of the cause of action. See British Airways Plc v Akinyosoye (1995)1 NWLR

(pt. 374) 772; Mrs. Adekoya v. Federal Housing Authority (2008) 28 WRN were cited on how to determine the Limitation period.

It was submitted that the action of the Respondent having become statute barred is incompetent and cannot be enforced. See Yare v. Nunku (1995) 5 NWLR (Pt. 394)129. The learned Counsel contended that even the demand letters attached to the Respondent’s originating processes cannot safe the action as same will still be barred by statute having been instituted after the statutory period of five years.

The learned Counsel submitted that the proposed amendment to the statement of claim does not revalidate the suit because its purpose is that the parties were negotiating and it was when negotiations broke down and the Appellant refused to pay the alleged debt that the Respondent instituted the action. It was submitted by Counsel that an amendment that will be prejudicial to the right of a party should not be granted or allowed. See UBA PLC v Abdullahi (2003)3 NWLR (Pt. 807) 359.

The learned Counsel submitted that in determining the applicability of a statute of limitation, the relevant consideration is usually when the cause of action

arose notwithstanding the period that negotiation was going on. See Adeyemi v Adegboyega (1473) Vol. 3 (pt.2) ECSNLR 991, Egbe v Adefarasin (1987)1 NWLR (pt.47)1; Goodwill Company Ltd v. Calabar Cement Company Ltd (In Liquidation) (2009) LPELR-8351 CA.

It was submitted that conclusion of the learned trial judge has statutory or judicial support. See N.B.N. Ltd V A.T. Eng. Co. Ltd (2006) 16 NWLR (Pt.1005) 222; Eboigbe V NNPC (1994)5 NWLR (Pt.347)649.

The Learned Counsel for the Respondent who settled the Respondent’s Brief that was filed on 12/12/14 argued that the grant of the amended Statement of Claim by the lower Court had revalidated the Suit filed by the Respondent on 30/6/2009 and the lower Court was also right to have held that the letter of July 28, 2006 by the Appellant to the Respondent has sufficiently acknowledged the outstanding indebtedness to make the time to run from 28th July, 2006 instead of 20th July, 2000 which was the original date of the alleged indebtedness.

It was submitted that the purpose of an amendment is to prevent the justice of the case from being defeated by the slips, mistakes or inadvertence of Counsel and the Courts have

always been liberal in granting amendment where it will not occasion injustice to the other party. See Chief Reuben O. Ozigbo V. The R. T. of Eze Oganiru (2009) Vol. 3 WRN 122. It was further submitted that the amendment in this case was desirable to ascertain the actual date the cause of action accrued as to be ascertained by the letters which the Respondent’s Counsel inadvertently omitted when the initial writ of summons was filed but which would be necessary to ascertain or resolve the real issues in controversy between the parties while the cause of action remains the same.

The learned Counsel submitted that the power to grant an amendment of pleadings is an absolute discretion of the trial Court which is unfettered and to be exercised judicially and judiciously which discretion can only be questioned by the appellate Court where it has resulted into injustice or the trial Court gave insufficient weight to important facts. See Solanke v Ajibola (1968) All NLR 46.

It was submitted also that an amendment takes effect from the dates of the original document amended and what stood before the amendment no longer defines the issues to be tried.

See Chastrith Investment Limited V Cussins (1959)1 All ER 148, and Const. Limited v Stephen Aware (2014)6 NWLR (Pt.1404) 523.

It was contended that the application of the Respondent did not introduce new issues by its application as to totally change the nature of the claims or to add to the scope of the case before the Court. It was contended that the cause of action in this case could not have accrued in 2003 but sometime in 2005/2006 after new terms and conditions were entered into, moreso that the present claimant acquired the original creditor and caused a letter of demand to be written to the Appellant who also replied thereto both through their respective solicitors.

The learned Counsel argued that the case of Goodwill Company Limited V. Calabar Cement Company (2009) LPELR 8351 relied upon by the appellant is not of any assistance to the appellant with regard to whether the suit filed at the High Court of Rivers State is statute barred. It was further contended that some of the cases cited by appellant’s counsel are not of any moment as they were not married to the facts of the instant case. It was submitted that if the facts of the case law cited

and those of the case under consideration are not similar, the Court is not bound or persuaded to follow the case. See Ogboru V Uduaghan (2011)2 NWLR (pt. 1232) 538; Onyia V. State (2009)18 NWLR (Pt.1118)142.

Counsel cited Section 28(5) of the Limitation Law of Rivers State and also submitted that the Limitation Laws of other States have never been made applicable in Rivers State and cannot be made applicable now. See Shell Petroleum Development Company (Nig) Limited v Amadi (2011) All FWLR (Pt. 604) 80 Onosowan V Chidozie (1996)9 NWLR (Pt 566) 477; Ishola V. SGB (Nig) Ltd (1997)2 NWLR (Pt. 488)405). Wherein, according to learned counsel, the Supreme Court laid down the rule applicable to action for the recovery of debt and that from the decision therein it is clear that an action for the recovery of statute barred debt can be resuscitated by the acknowledgment by the debtor which acknowledgement must by virtue of Section 29(1-2) of the Limitation Law of Rivers State must be in writing and signed by the person making same.

It was the contention of the learned Counsel that the letter of 28th July, 2006 written and signed by the Solicitor to the Appellant and on

his behalf is sufficient acknowledgment of the indebtedness. See Good v Party (1965)2 AllER 59. The cause of action arose upon the letter of acknowledgment. See Chami v UBA Plc (2010) 6 NWLR (Pt.1191) 471; Nike V. Oluwo (2002) 3 NWLR (Pt. 699)109. It was submitted that the amended pleadings of the Respondent filed in this matter cannot be faulted. See NBC V Chief Uzoma Ubani (2014)4 NWLR (Pt.1348)436.

The Ruling of the lower Court that gave rise to this appeal is in the Additional Record of Appeal transmitted on 11/11/2014 but deemed on 14/7/2020. After reviewing the affidavit evidence in relation to the two motions before the Court, the lower Court stated on page 8 that:
“while it is true that registrations between that parties does not change the accrual date of the cause of action, in this case where parties based on negotiations changed hands as per acquisition of continental Trust Bank by United Bank for Africa and also changed the terms of the contract in 2005/2006 to 19% interest instead of 28%, clearly the relief sought based on 19% interest rate clearly shows that the cause of action could not have accrued in 2003 when the debt that accrued as at

2002 was based on 28% interest rate which was contained in the letter of July 2003, defendants rely on same strongly.”

According to Kalgo JSC in Araka v Ejeagwu (2002)12 SC (Pt.1) 99 (2000) LPELR-533 (SC), statute barred simply means barred by a provision of the statute. It is usually as to time and one is barred from taking action after the period specified in the statute. It is the law that where a statute provides for the bringing of action within a prescribed period, proceedings shall not be brought after the time prescribed by the statute has expired. See Obiefuna v Okoye (1991)1 All NLR 374; Eboigbe v NNPC (1994)5 NWLR (Pt. 437)649.

The applicable limitation law in the instant case is the Limitation Law of Rivers State which in Section 28(5) provides that where any right of action has accrued to recover any debt or other pecuniary claim or any claim in the estate of a deceased person or to any share or interest in any such estate and the person liable or accountable for the claim acknowledges the claim or makes any part of payment in respect of it, the right shall be treated as having accrued on and not before the date of the acknowledgment or payment.

This provision of the law has certainly gained judicial recognition or approval by the apex Court in the case of T. Thadani & Anor v. National Bank Ltd & Anor (1972)1 SC (Reprint) 75 where it was held that by acknowledgment of the debt or part payment thereof, the debtor establishes a fresh contractual relationship so that the cause of action starts to run from the date of the fresh relationship. See also Nigeria Social Insurance Trust V. Klifco Nig. Ltd (2010)13 NWLR (Pt. 1211)307.
It is agreed by the parties in this appeal that there was correspondence in writing between the parties. I am not in any doubt from the letters that the appellant acknowledged indebtedness to the respondent, and in line with the foregoing authorities, a new relationship has thereby been created from which the cause of action in this case accrued.

overreaching the other party. See Ogidi V. Egba (1999)10 NWLR (Pt. 621)42. It is also well established that an appellate Court will ordinarily not interfere with the exercise of discretion by a lower Court. An appellant who challenges the exercise of discretion by the lower Court must satisfy the Court that the discretion was not exercised judicially and judiciously. See Minister P.M.R V. El (Nig) Ltd (2010)12 NWLR (Pt. 1208) 261. Based on my candid consideration of the facts and circumstances of this case, I agree with the resolution of the two applications by the lower Court.

I therefore resolve the two issues against the appellant and the consequence is that the appeal lacks merit and it is dismissed.
No order as to costs.

CORDELIA IFEOMA JOMBO-OFO, J.C.A.: I agree.

ABUBAKAR MU’AZU LAMIDO, J.C.A.: I have had the privilege of reading in draft the judgment delivered by my learned brother ISAIAH O. AKEJU, JCA and I am in complete agreement with the reasoning and conclusion reached therein. I too dismiss the appeal and abide by all the consequential orders in the lead judgment.

Appearances: