MOBIL PRODUCING NIGERIA UNLIMITED V. SUFFOLK PETROLEUM SERVICES LIMITED
(2013)LCN/5941(CA)
In The Court of Appeal of Nigeria
On Wednesday, the 20th day of February, 2013
CA/PH/43/2012
RATIO
“The point on this second issue is simple and straight forward and it is whether the lower court ought to have heard the application for Stay of proceedings before taking the one for interim injunction and making an order thereon. The application for interim injunction is itself a proceeding in the action before the lower court. This is so because an act which has some degree of formality and significance and which was done pursuant to any rule of court and has received the attention of the court is a proceeding. See FAWEHINMI v. AKILU (1988) 4 NWLR (Pt. 88) 367 at 378.” Per NWOSU-IHEME, J.C.A.
“Section 251(1) of the 1999 constitution clearly places the matter listed in subsection (1) – (a) (b) within the exclusive jurisdiction of the Federal High court. Subsection (1)(n) is relevant to the present proceedings on appeal before us. It reads: “(1) (n) Mines and Minerals (including Oil Fields, Oil Mining, Geological Surveys and natural gas).” This portion of section 251 of the constitution has been subject to numerous judicial interpretations and dicta by the Courts, In SHELL PETROLEUM DEV. CO. NIG. LTD V. ISAIAH (2001) 11 NWLR (pt.723) 168 at 178 – 180, the supreme court held that the construction, operation and Maintenance of an Oil Pipeline are matters pertaining to or connected with mines and minerals including oil Fields, Oil Mining etc as envisaged under section 251(1)(n) of the constitution and therefore within the exclusive jurisdiction of the Federal High Court. Similar conclusions were reached in the principle of the decisions in BARRY v. ERIC (1998) 8 NWLR (PT. 562) 404 at 417 and 422 – 423 and the views of SAULAWA JCA in SPDC V. SIRPI ALUSTEEL CONSTRUCTION LTD supra at page 163 with which view I agree. See also SHELL PETROLEUM DEV. CO. OF NIG. LTD v. MAXON (2001) 9 NWLR (PT.719) 541 at 554 – 555.” Per NWOSU-IHEME, J.C.A.
JUSTICES
MOHAMMED LADAN TSAMIYA Justice of The Court of Appeal of Nigeria
CHIOMA E. NWOSU-IHEME Justice of The Court of Appeal of Nigeria
UCHECHUKWU ONYEMENAM Justice of The Court of Appeal of Nigeria
Between
MOBIL PRODUCING NIGERIA UNLIMITED Appellant(s)
AND
SUFFOLK PETROLEUM SERVICES LIMITED Respondent(s)
CHIOMA E. NWOSU-IHEME (Ph.D), J.C.A. (Delivering the Leading Judgment): The Respondent in this appeal as Plaintiff (Claimant) in the lower Court commenced proceedings in that court claiming some declaratory reliefs, and injunctions against the appellants as defendants in respect of a contract between the parties. The reliefs sought at the lower court are clearly set out in the Writ of Summons at pages 3 – 4 of the Record of Appeal and repeated in paragraph 192 of the statement of claim at pages 63 – 64. The Respondent also filed an Exparte motion for interim injunction.
When the Exparte motion for interim injunction came up before the lower court on the 25/6/11, the court after granting leave for service of the defendant outside jurisdiction, ordered the defendant to appear before it on 1/11/11 to show cause why an order of interim injunction should not be made. Upon service on it of the process of court including the order to show cause aforesaid, the appellant (defendant in the court below) filed an application for stay of the proceedings of the lower court pending an arbitration between the parties pursuant to the terms of their contract. Both the motion for stay of proceedings and the one for interim injunction came up before the lower court on 1/11/11 and that court granted the application for interim injunction and adjourned the motion for stay of proceedings to 22/11/11 for hearing.
The present appeal is against that ruling. Altogether Four grounds of appeal were filed by the Appellant. The Complaints therein, in summary being lack of jurisdiction in the lower court to entertain the matter before it and error in the lower court in granting the application for interim injunction without first hearing the application for stay of proceedings. The appellant’s counsel in her brief at page 5 thereof formulated three (3) issues from the grounds of appeal thus:
“1. Whether the Federal High Court, has the jurisdiction to entertain the Respondent’s matter and to make the order of interim injunction pertaining to simple contracts?
2. Whether the lower court was right in assuming jurisdiction and making the interim order for injunction when it has not considered the Appellant’s application for stay of further proceedings pending arbitration?
3. Whether failure to hear the Application for stay of proceedings pending arbitration before making the order of interim injunction breached the Appellant’s right to fair hearing?”
On his part learned counsel for the respondent identified Four (4) issues as determinable from the grounds of appeal. They were set out at pages 6 – 7 of his brief as follows:
“1. Whether or not in the peculiar circumstances of this case where the MIPS Contract No. A2246515 for the Major Integrity Pipeline Projects EPCM-1 Offshore Pipeline and Platform Tie-Ins, as the name implies, relates to installation of Offshore Pipelines and Oilfield Platforms and involves the use of several marine vessels, work Barges and Pipelay Barges, the Federal High Court does not have the jurisdiction to hear and determine the case?
2. Whether or not the mere presence of an arbitration clause in a contract such as the MIPS Contract No. A2246515 robs the Federal High Court of its Jurisdiction to hear and determine the case?
3. Whether or not in the peculiar circumstances of this case, the court below was right in granting the Order of Interim Injunction meant to keep parties in status quo pending the hearing and determination of the pending interlocutory applications especially the Appellant’s motion for stay of proceedings pending reference of the dispute between the parties to arbitration?
4. Whether or not, having given the Appellant the opportunity to be heard in the peculiar circumstances of what transpired in this case before the lower court on 1st November, 2011, an opportunity which the Appellant failed to utilize, the same Appellant can turn around to complain of denial of its right to fair hearing?”
In my view the issues set out in the respondent’s brief are virtually similar to those set out in the appellant’s brief and can conveniently be consumed in them. I, therefore propose to deal with this appeal on the basis of the issues set out in the appellant’s brief which themselves can be reduced into two namely:
(1) Whether the lower court has jurisdiction to entertain the action before it.
(2) If it has jurisdiction, whether it was right for it to consider the application for interim injunction without first disposing of the application for stay of proceedings.
This last issue covers issue Nos. 2 and 3 raised by the appellant.
On the first issue above, learned counsel for the appellant Mrs. Essien SAN, submitted, in summary, that the jurisdiction of a court to entertain a matter was so fundamental that it could be raised at any time and that in consideration of the issue of jurisdiction it is the plaintiff’s claim that was relevant. She referred to section 251(1) of the 1999 constitution and after pitching it against the background of the claims and statement of claim, contended that the claims were founded in simple contract in respect of which the Federal High Court had no jurisdiction. She argued that on the authority of SPDC NIG. LTD V. SIRPI ALUSTEEL CONSTRUCTION LTD (2007) 1 NWLR (PT. 1067) 128 at 150, the fact that a party was an oil Mining Company did not mean that actions in respect of commercial contracts was to be entertained at the Federal High Court.
In his reply on this issue, learned counsel for the respondent, Mr. Wanogho, in summary contended that by virtue of section 251(1) of the 1999 Constitution and on a long line of authorities on the point, as set out in his brief, the action fell squarely within the jurisdiction of the lower court as the State High Court had no such jurisdiction.
The subject matter of the action which gave rise to the claims was set out in paragraph 9 of the statement of claim of Extreme prolixity covering 192 paragraphs. That paragraph reads as follows:
“9. Under the said subcontract, even though the scope of work shall be as defined in individual letters of Authorisation (LOA’s) issued under the sub-contract, the subcontract is generally described as offshore pipeline installation engineering, procurement, construction and installation work for the defendant’s Major Integrity Projects (MIPS), Offshore Nigeria.
However, the scope of work expected to be carried out under the subcontract include:
* Shore Crossings;
* Onshore pipeline Sections,
* The Fabrication and Installation of associated risers.
* Pig Launchers and receivers
* Pumb and air Compressor skids; and deck extensions, as well as execution of the tie ins, the in-place abandonment of existing pipeline Segment, removal of existing risers, etc.”
Section 251(1) of the 1999 constitution clearly places the matter listed in subsection (1) – (a) (b) within the exclusive jurisdiction of the Federal High court. Subsection (1)(n) is relevant to the present proceedings on appeal before us. It reads:
“(1) (n) Mines and Minerals (including Oil Fields, Oil Mining, Geological Surveys and natural gas).”
This portion of section 251 of the constitution has been subject to numerous judicial interpretations and dicta by the Courts. In SHELL PETROLEUM DEV. CO. NIG. LTD V. ISAIAH (2001) 11 NWLR (pt.723) 168 at 178 – 180, the supreme court held that the construction, operation and Maintenance of an Oil Pipeline are matters pertaining to or connected with mines and minerals including oil Fields, Oil Mining etc as envisaged under section 251(1)(n) of the constitution and therefore within the exclusive jurisdiction of the Federal High Court. Similar conclusions were reached in the principle of the decisions in BARRY v. ERIC (1998) 8 NWLR (PT. 562) 404 at 417 and 422 – 423 and the views of SAULAWA JCA in SPDC V. SIRPI ALUSTEEL CONSTRUCTION LTD supra at page 163 with which view I agree.
See also SHELL PETROLEUM DEV. CO. OF NIG. LTD v. MAXON (2001) 9 NWLR (PT.719) 541 at 554 – 555.
From the above postulations of the law on the matter, it is clear to my mind and I do not have the slightest doubt that the pleading in the statement of claim particularly paragraph 9 thereof which distinctly set put the scope of the contract brings the action squarely within the provisions of section 251(1)(n) of the constitution thus fixing exclusive jurisdiction in the action in the Federal High court which the lower court is. Accordingly my answer on the first issue is in the affirmative. The lower court therefore had jurisdiction. The Ground of appeal related to that issue, i.e. ground 2, therefore, fails.
On the second issue, appellant’s counsel argued in summary, that the lower court had a duty to consider all pending applications before it that may impact upon an order that it was being asked to make. Counsel argued that the application for Stay of Proceedings ought to have been taken before the consideration of the one for interim injunction as it was in itself a cause why the order sought in the interim injunctive relief ought not to be made.
In his reply, learned counsel for the respondent submitted that in the circumstance of the case, the order for interim injunction made by the lower court was to preserve the res in dispute from being destroyed while matters were still in court. He contended that the application for Stay of Proceedings was not an affidavit to show cause as required by order 26 Rule 4 of the Federal High Court Rules.
I must say, at this point, that all the arguments by both counsel in this appeal as to the effect of an arbitration clause in a contract such as the one in contention could stay or oust the jurisdiction of the lower court pending such an arbitration were arguments for the lower court at that stage and ought to be taken in the consideration of the motion for Stay of Proceedings at the lower court and ruled upon before such arguments would be canvassed here. To canvass that point here now and at this stage and from the nature of the present appeal would be to becloud the real point on the second issue under consideration. Those argument could have better be taken during the hearing of the application for Stay of Proceedings since that application is still pending in that Court. The point on this second issue is simple and straight forward and it is whether the lower court ought to have heard the application for Stay of proceedings before taking the one for interim injunction and making an order thereon.
The application for interim injunction is itself a proceeding in the action before the lower court. This is so because an act which has some degree of formality and significance and which was done pursuant to any rule of court and has received the attention of the court is a proceeding. See FAWEHINMI v. AKILU (1988) 4 NWLR (Pt. 88) 367 at 378.
Now the appellants on receipt of the writ of summons, the statement of claim, a Motion on Notice for Injunction and an order of court to show cause why an order of interim injunction should not be made filed an application for stay of proceedings pending arbitration pursuant to clause 30 of their contract subject of the action at the lower court. (See pages 383 – 524 of the Record of Appeal).
Since the application was one for stay of proceedings which proceedings would include the motion for interim injunction in respect of which the appellants were asked to show cause, to have proceeded without first disposing of the application for stay either way by the lower court is in my view erroneous. The lower court should have heard the application for stay first and if it dismissed it, then proceeded to take the one for interim injunction.
The fact that the lower court later adjourned the application for stay of proceedings to a future date does not change my view on the point. Having taken the motion for injunction and granting it (which was one of the proceedings sought to be stayed), the court had more or less foreclosed the application or rendered it impotent without hearing arguments on the merits.
The court appeared to have been influenced by the argument that the application for stay was not “an affidavit to show cause.” In my humble but firm view, that was relying on undue technicality because the effect of the application, as correctly submitted by the appellants counsel before this court, was to show reason why the order for interim injunction should not be made. The lower court was certainly at liberty not to see reason with the reasons contained in the application but before then, he was, in the interest of justice and fair play, bound to have heard the application on its merits before turning to the application for interim injunction.
Obviously the application for stay of proceedings had the potentiality of impacting on the order sought in the application for interim injunction and the lower court was bound to have heard it before its order.
See MOBIL PRODUCTING NIG. LTD V. MONOKPO (2003) 18 NWLR (PT. 852) 346 at 413.
DINGYADI V. INEC (NO.1) (2010) 18 NWLR (pt. 1224) pg 1 at 52.
AFRO-CONTINENTAL LTD. v. CO-OP ASSOCIATION OF PROFESSIONAL INC. (2003) 5 NWLR (PT. 813) 303 at 307. Failure to do so was akin to failure in justice and fair play.
In the circumstance and in the light of all I have said on this second issue, that issue is resolved in the negative and in favour of the appellant.
It is on this issue, therefore, that this appeal succeeds. The order of interim injunction made by the lower court without first disposing of the application for stay of proceedings is hereby set aside. The matter is remitted back to the lower court for the application for stay of proceedings to be heard on the merits before the consideration of the motion for interim injunction. The application should be taken by another Judge of the Federal High court Port Harcourt Division other than Justice Akanbi.
M. L. TSAMIYA, J.C.A.: I agree.
UCHECHUKWU ONYEMENAM, J.C.A.: I read before now the draft lead Judgment just delivered by my learned brother C. E. Nwosu-Iheme JCA. I agree with her reasonings and conclusions.
Appearances
Mrs. M.A. Essien, SAN with her Miss R.I. Omofuma, O.U. Ulasi. Esq and Aham Eke EjelamFor Appellant
AND
R.E. Wanogho with him Miss O. Osirim, Miss J.O. Nwadinobi and Miss O. ChanaiFor Respondent
