NATIONAL INSURANCE COMMISSION v. MRS. MODUPE OYEPERO OYEFESOBI & ORS (2013)

NATIONAL INSURANCE COMMISSION v. MRS. MODUPE OYEPERO OYEFESOBI & ORS

(2013)LCN/6027(CA)

In The Court of Appeal of Nigeria

On Friday, the 15th day of March, 2013

CA/L/659/2010

RATIO

JURISDICTION: THE ISSUE OF JURISDICTION IS FUNDAMENTAL AND THE EFFECT OF A COURT LACKING JURISDICTION

It is trite, that the issue of jurisdiction is most fundamental. This is absolutely so, because where a court entertains and determines a matter without having the requisite jurisdictional competence to do so, the resultant decision or judgment thereof is rendered a nullity.
And such a decision or judgment is liable to be set aside, either by the trial court itself, or on appeal by the appellate court.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

JURISDICTION: WHEN IS A COURT SAID TO BE COMPETENT TO ENTERTAIN ANY CASE BEFORE IT

And the law is well settled, to the extent that a court is competent to entertain any case before it, where:
(a) It is properly constituted as regards numbers and qualification of the members thereof;
(b) The subject matter of the case is within the court’s jurisdiction and there is no feature in the case which prevents it from exercising the jurisdiction thereof and,
(c) The case is initiated by due process of the law, and upon fulfillment of condition precedent to the exercise of jurisdiction. See MADUKOLU VS. NKEMDILIM (1962) 2 SC NLR 341; OLORIODE VS. OYEBI (1984) 1SC NLR 390; OSAFILE VS. ODI (NO.1) (1990) 3 NWLR (Pt.137) 130; NALSA & TEAM ASSOCIATES VS. NNPC (1996) 3 NWLR (Pt. 439) 621; BRONIK MOTORS VS. WEMA BANK LTD (1983) 1 SC NLR 296; OBIKOYA VS. REGISTRAR OF COMPANIES (1975) 4 SC 31; NYAME VS. FRN (2010) 7 NWLR (Pt. 1193) 344 at 393 – 394 paragraphs A – C, respectively.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

NATIONAL INSURANCE ACT: SECTION 51: PROVISION

PRE-ACTION NOTICE: WHAT IS THE MAIN OBJECT OF A PRE-ACTION NOTICE
It is equally trite, that the main object of pre-action notice is to accord the (potential) Defendant a breathing time so as to enable him to determine whether he should make any preparation regarding the Plaintiff’s claim. So it was aptly held by the Apex court in a plethora of authorities, including the following: NGELEGLA VS. TRIBAL AUTHORITY, NONGOWA CHIEF DOM (1953) 14 WACA 325 @ 327. See also ATOLAGBE VS. AWUNI (1997) 9 NWLR (Pt. 522) 536.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

NNPC ACT: SECTION 11(2) : PROVISION

The case of AMADI VS. NNPC (supra), was predicated upon the provision of Section 11(2) of the NNPC ACT, 1977, which is to the following effect:
11. (1) Notwithstanding anything in any other enactment, no suit against the Corporation, a member of the Board or any employee of the Corporation for any act done in pursuance or execution of any enactment or law, or of any public duties or authority, or in respect of any alleged neglect or default in the execution of such enactment or law, or of any public duties or authority, shall lie or be instituted in any court unless it is commenced within twelve months next after the act, neglect or default complained of or, in the case of a continuance of damage or injury, within twelve months next after the ceasing thereof.
(2) No suit shall be commenced against the Corporation before the expiration of a period of one month after written notice of intention to commence the suit shall have been served upon the Corporation by the intending plaintiff or his agent; and the notice shall clearly and explicitly state the cause of action, the particulars of the claim, the name and place of abode of the intending plaintiff and the relief which he claims.
It’s pertinent to reiterate, that the provisions of Section 11 (1) & (2) of the NNPC Act 1977 (supra), upon which the decision of the Apex court in AMADI VS. NNPC (supra) was based is in pari-materia with Section 51 (1) & (2) of the National Insurance Commission Act, 2004. The Apex court’s unanimous decision in AMADI VS. NNPC (supra) is to the effect, inter alia, that a pre-action notice is a precondition precedent to the institution (or commencing) of an action or suit against the Defendant.
In the instant case, the phrase –
“No suit shall be commenced…”
as couched in Section 51 (2) of NAICOM Act (supra), arguably connotes an obligation, as the word “shall” therein is rather mandatory. Thus, the implication being that no suit or action could be validly instituted (commenced) against the present Appellant in any court unless a pre-action notice is served thereupon. And that in the event of being duly served upon the Appellant, a suit can only validly be instituted or commenced against the Appellant after the expiration of 30 days after the pre-action notice was served upon the Appellant. See AMADI VS. NNPC (supra), wherein the Supreme Court held that –
while the issuance of the notice by a prospective Plaintiff is mandatory, the particulars to be included in the notice which are cause of action particulars of claim, name and place of abode, of the intending Plaintiff and the relief to be claimed – appear to me to be declaratory. Per Uwais, CJN at 98 paragraph D.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

NOTICE OF CLAIM: THE PURPOSE OF GIVING NOTICE OF CLAIM
What’s more, in the case of KATSINA LOCAL GOVERNEMT VS. MAKUDAWA (1971) 1 NWLR 100 @ 107 (approvingly referred to in AMADI VS. NNPC), the Supreme Court held that the purpose of giving notice of claim to the Local Government against it was to guard against being taken by surprise, and to have adequate time to prepare to deal with the defence thereto. According to the Apex Court, the purpose of a pre-action notice –
“is not to put hazards in the way of bringing litigation against it.” Per Coke, JSC.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

WORDS AND MEANING: “SHALL”: MEANING OF THE WORD SHALL WHEN USED IN AN ENACTMENT
It is equally a trite principle, that the term “shall” when used in an enactment is capable of bearing more than one meaning. The word “shall” may sometimes imply futurity. It may imply a mandate; an obligation. It may equally imply a direction, or giving permission (to do something). See IFEZUE VS. MBADUGHA (1984) 1 SC NLR 427 at 456 – 457.
As a fundamental principle, the word “shall”, where ever used in a mandatory sense, then the action required must be exactly carried out, obeyed or fulfilled, in accordance with the spirit and intendment of the command. Contrariwise, if the word “shall” is used in a directory sense, then the action required is to be obeyed, carried out, or fulfilled in substantial compliance with the directive. See WOOD VS. SARSONS (1875) LR 10 CP 733 @ 746; POPE VS. CLARK (1953) 1 WLR 1060; JULIUS VS. LORD BISHOP OF OXFORD (1880) 5 AC (HL) 214 @ 222; 235; STATE VS. KORI (1983) 1 SC NLR 94 @ 110; LIVER POOL BOROUGH BANK VS. TURNER (1861) 30 LJ CH. 379 @ 657.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

APPEAL: THE MERE FILING OF AN APPEAL DOES NOT OPERATE AS A STAY OF EXECUTION

Indeed, it’s a well settled principle, that the mere filing of an appeal does not, ipso facto, operate as a stay of execution of the decision or judgment appealed against. However, where the Appellant, in addition to the appeal, deems it expedient to file a motion on notice for stay of execution (or) for variation of the conditions of stay, as imposed by the trial court, it becomes most desirable not only for both parties but also the trial court itself to ensure that no fait accompli is thrust upon the appellate court, which may result in rendering the appeal nugatory. See STANDARD TRUST BANK LTD VS. CONTRACT RESOURCES (NIG) LTD (2001) 6 NWLR (Pt.708) 115; JULIUS BERGER (NIG) PLC VS. TOKI RAINBOW COMMUNITY BANK (2007) NWLR (Pt. 1016) 540; UBA PLC VS. EKANEM & 1 OR. (2009) 40 WRN 150 @ 162, paragraphs 25 – 35.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

STAY OF EXECUTION: WHEN AN APPLICATION FOR STAY OF EXECUTION SHOULD NOT BE REFUSED

Ordinarily, an application for stay of execution should not be refused where the effect of such refusal would render the appeal nugatory, if the appeal eventually succeeds. See WILSON VS CHURCH (NO.2) (1879) 12 CHD 454; UTIL GAS NIG. & OVERSEAS GAS CO. LTD VS. PAN AFRICAN BANK LTD (1974) 10 SC 105; DEDUWA VS. OKORODUDU (1974) 4 ULLR 352. VASWANI TRADING CO. LTD VS. SAVALAKH (1972) 12 SC. 77. MARTINS VS. NICANNER FOODS CO. LTD (1988) 2 NWLR (Pt. 74) 75.
Most particularly, in VASWANI TRADING COY VS. SAVALAKH’S case, the decision of the Supreme Court is to the effect, inter alia, that once an application for stay of execution of judgment pending appeal is filed and duly served upon the Respondent, the Respondent is enjoined to withhold action even though the application has not yet been heard. Similarly, the trial court is equally enjoined to refrain from issuing a writ of attachment, or to carry on proceedings in a manner which will under the result of the application for stay nugatory. See UNION BANK OF NIG. PLC VS. FAJEBE FOODS AND POULTRY & ANR. (1994) 5 NWLR (Pt. 344) 325; MOHAMMED VS. OLAWUNMI (1993) 4 NWLR (Pt. 287) 254.PER IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A.

JUSTICES

IBRAHIM MOHAMMED MUSA SAULAWA Justice of The Court of Appeal of Nigeria

JOSEPH SHAGBAOR IKYEGH Justice of The Court of Appeal of Nigeria

RITA NOSAKHARE PEMU Justice of The Court of Appeal of Nigeria

Between

NATIONAL INSURANCE COMMISSION Appellant(s)

AND

1. MRS. MODUPE OYEPERO OYEFESOBI
2. BAICO INSURANCE PLC
3. CENTRAL BANK OF NIGERIA Respondent(s)

IBRAHIM MOHAMMED MUSA SAULAWA, J.C.A. (Delivering the Leading Judgment): The instant appeal is against the ruling of the Federal High Court, Lagos Judicial Division, which was delivered on July 6, 2008 in Suit No. NRT/L/06/2006. By the ruling in question, the court below, Coram C. E. Archibong, J; granted a Garnishee order absolute against the 1st & 2nd Garnishees, being the present Appellant and the 3rd Respondent, respectively. Being dissatisfied with the said ruling, the Appellant filed the notice of appeal thereof on June 2, 2010 in the court below, urging on this court, inter alia, to set aside the garnishee order absolute.

BACKGROUND FACTS:
On May 12, 2005, Dr. Segun Oladele Oyefesobi filed an originating application against the 2nd Respondent at the Investments And Securities Tribunal, sitting in Abuja Judicial Division, seeking various declaratory and injunctive reliefs, to wit:
i. A declaration that by virtue of Memorandum of Understanding dated May 18, 2000 between the Applicant and the Respondent the Applicant is entitled to 24,062,500 units of shares as right due to him under the November/December 1999 rights issues.
ii. A declaration that the letter dated February 6, 2003 written by the 1st Respondent to the Applicant limiting the shareholding of the Applicant in the shares, is null and void and of no legal effects.
iii. A declaration that the Applicant is entitled to voting rights and privileged as shares holders of 35,678,186 units of shares in Annual General Meeting any meeting of the Respondent company.
iv. An order directing the Respondent to issue and deliver the share certificate in respect of the 24,062,500 share being right due to the Applicant under the November/December 1999 right issue as contained in the Memorandum of Understanding dated May 18,2000.
v. The sum of N34,650,000 being the value of the 24,062,500 units of share due to the Applicant in the Respondent company at the current market rate of N1.44k per share.
vi. And for such further order or other as the Honourable Tribunal might deem fit to make in the circumstances of this case.

Upon the demise thereof, the complainant’s wife, Mrs. Modupe Oyepero Oyefesobi (the 1st Respondent), was substituted as the Applicant. The suit proceeded to trial.

On July 26, 2006, the Tribunal delivered judgment in favour of the 1st Respondent for the sum of N34,65,000.00, and interest at the rate of 10% per annum from the date of judgment.

On August 15, 2006, the 1st Respondent filed a motion exparte (NRT/L/06/2006) in the Federal High Court, Lagos Judicial Division, seeking the following reliefs:
1. An order of the Honourable Court granting leave to the judgment Creditor/Applicant to register in this Honourable Court the Certificate of judgment dated 15th day of August, 2006 issued by the Investments and Securities Tribunal, Abuja.
2. An order granting leave to the judgment Creditor/Applicant to issue Writ of Execution against the judgment Debtor.
3. An order of the Honourable Court directing the Commissioner of Police Lagos State, the Deputies, Assistances and all other officers under them to assist the judgment Creditor/Applicant and the Deputy Sheriff of the Honourable Court in the Execution of the judgment of the Investments and Securities Tribunal, Abuja dated the 26th day of July, 2006.

That application was indeed granted on November 21, 2006. Exactly one year thereafter, specifically on November 2, 2007, the 1st Respondent filed an exparte application in the court below seeking Garnishee Order Nisi attaching the money belonging to the 2nd Respondent with the Appellant and 3rd Respondent. The exparte application for a Garnishee Order Nisi was granted by the lower court on November 29, 2007. Consequent upon which, the lower court granted a Garnishee Order absolute on July 21, 2008, to the following effect:
IT IS ORDERED that an order absolute attaching the money belonging to the judgment Debtor/Respondent with the National Insurance Commission and the Central Bank of Nigeria (the Garnishee) to the extent of N34,650.00 plus interest at the rate of 10% per annum from the date of the judgment until final liquidation of the judgment sum.

IT IS ALSO ORDERED that the said stator deposit is attached to the extent of the judgment debt and it will go to satisfy same leaving whatever balance to the account of the judgment Debtor for it to address whatever statutory obligations are due to enable it continue in operation.

As alluded to above, it’s against the lower court’s order of July 21, 2008 in question that the instant appeal has been instituted. The notice of appeal was filed on June 2, 2010, pursuant to order of court granted on May 22nd, 2010. It is predicated on a total of five grounds. The record of appeal was transmitted to this court on June 24, 2010. The Appellant’s brief of argument was filed on August 4, 2010. The Respondent’s brief was filed on June 28, 2011, but deemed properly filed on February 29, 2012. The Appellant’s reply brief was filed on March 8, 2012. The appeal was eventually heard on January 16, 2013, and accordingly reserved for delivery of judgment.

At page 3 of the brief thereof, the Appellant has distilled three issues from the five grounds of the notice of appeal, namely:
(1) Whether the statutory deposit of an Insurer, which is in the custody of the Central Bank but under the control of the National Insurance Commission, can be attached under a Garnishee Order in satisfaction of a judgment debt which is not related to insurance claim. (Based on Ground 1).
(2) Whether the Court below was right in assuming jurisdiction when the conditions precedent stipulated by statutes were not fulfilled by the 1st Respondent/Judgment Creditor. (Based on Appeal Grounds 3 and 4).
(3) Whether the Garnishee Order is not incompetent for its issuance while an appeal was pending on the judgment upon which, it was based and when a stay of execution of the Judgment had been obtained and for violating Section 51 (3) of the National Insurance Commission Act, Cap N53,2004 LFN and the Central Bank of Nigeria Act, CAP. C4 2004 LFN. (Based on Appeal Grounds 2 & 5).

In a nutshell, the submission of the Appellant on issue No. 1 is to the effect, inter alia, that the money attachable under a garnishee proceeding must be a debt which is due, or accruable, to the judgment debtor. See Section 83 (1) Sheriffs & Civil Process Act CAP. S6 Laws of the Federation, 2004; BLACK’S LAW DICTIONARY, 5th edition, at 363; UBA LTD VS. SGB LTD (1996) 10 NWLR (Pt.708) 115; WEB VS. STENTON (1883) 11 QBD 518; HOLLBY VS. HODGSON (1889) 24 QBD 103 @ 108.

The provisions of Sections 10, 32 (4) and 70 (I) (b) of the Insurance Act, CAP. 117 Laws of the Federation of Nigeria, 2004, and Section 7 (h) of the National Insurance Commission Act, CAP. N53, were equally referred to-

Equally submitted, to the effect that money in the hands of a receiver for debenture holders, estimated to be more than sufficient to discharge preferential debts and debenture holders, is not a debt due and so is not attachable. See also Afe Babalola, SAN: Enforcement of Judgments, at Page 116; OSI BAMOWO VS. SHADERO (1967) LLR 7; DEABROOK ESTATE CO. LTD VS. FORD (1949) 2 AER 94.

It was contended, statutory deposit under the control and custody of the Appellant and 3rd Respondent is not a debt due and payable to the 2nd Respondent (Judgment Debtor). The Court has been urged to so hold, and accordingly allow the appeal on the said issue No.1.

On issue No.2, it was postulated, inter alia, that no pre-action notice was served on the Appellant, contrary to Section 51 (1) & (2) of the National insurance Commission Act (supra). See BLACK’S LAW DICTIONARY, 7th edition, at 1448; Section 11 (2) NNPC Act CAP. N123, Laws of the Federation of Nigeria, 2004; AMADI VS. NNPC (2000) 10 NWLR (Pt. 674) 76, at 107 – 108, & 110.

Secondly, it was contended, that the consent of the Attorney General was not obtained prior to the issuing of the order nisi. Thus, as there was no evidence that the Attorney General’s consent was obtained, the garnishee proceeding against the Appellant is incompetent, and ought to have been dismissed. See YESUFFU OJO VS. H. A. WILLIAMS (1933) 11 NLR 106; NIGERIAN NATIONAL SUPPLY CO. LTD VS. ALHAJI HAMMAFODA SABAMA CO. LTD (1988) 3 SCNJ (Pt.1) 30.

The court is urged to answer issue No. 2 in the negative.

Issue No.3, allegedly relates to jurisdiction of the lower court. Referring to Section 51 (3) of NAICOM ACT, 1997 (supra), it was submitted that the garnishee process cannot be issued against the Appellant. Thus, the lower court had acted without jurisdiction. See Section 48 (I) of the CBN Act, CAP. C4 LFN 2004.

It was further submitted, that the issuance of garnishee order Nisi and order absolute on 29/11/07 and 21/7/08 respectively by the court below, when an appeal (and application for stay of execution) had been filed on 21/8/06, was incompetent and without jurisdiction. See STB LTD VS. CONTRACT RESOURCES LTD (2001) 6 NWLR (Pt.708) 115; FASHAHUN FOODS NIG. LTD. VS. SHOSANYA (2003) 17 NWLR (Pt.849) 237 at 247; Section 51 (3) NAICOM Act; Section 48 (I) CBN Act.

Conclusively, the court has been urged to allow the appeal.

On the other hand, the Respondent has equally formulated a total of three issues in the brief thereof, viz:
3.1 Whether or not the 2nd Respondent/Judgment Debtor’s statutory deposit with the Appellant is attachable by the 1st Respondent/Judgment Creditor under a Garnishee order in satisfaction of a judgment debt. (Formulated from Ground 1).
3.2 Whether the court below was right in assuming jurisdiction when the conditions precedent stipulated by statutes were not fulfilled by the 1st Respondent. (Formulated from Ground 3).
3.3 Whether there was an order of stay of execution when the lower court issue the Garnishee order absolute and assuming (without conceding) there was an order for stay, whether a stay of execution can preclude the 1st Respondent/ Judgment Creditor from seeking to use garnishee proceedings to enforce the judgment. (Formulated from Ground 2).

On issue No.1, it was submitted that any deposit, whether statutory or otherwise, upon which an interest is accruable is operational i.e. capable of being operated by the depositor. See Section 10 (4) & (5) of Insurance Act (supra).

It was contended, that in as much as the 2nd Respondent is entitled to lawfully withdraw from the statutory account, the 2nd Respondent has an immediate legal right to the fund with the 2nd Garnishee. See UBA VS. SGB LTD (1996) 10 NWLR (Pt. 478) 381 at 390 D; HOLLBY VS. HODGSON (1889) 24 QBD 103 at 108.

The court has been urged to resolve issue No.1 in favour of the 1st Respondent.

On issue No. 2, it was postulated that the issue of non-service and consent of AGF was raised for the first time on appeal by the Appellant. That, the issue of non service is an irregularity, which the Appellant has waived. See EZE VS. OKECHUKWU (2002) 12 SC (Pt.11) 110 paras 5 – 10; 112 para 5; FEED & FOOD FARMS (NIG) LTD VS. NNPC (2009) 6-7 SC1 at 14 – 15; MOBIL PRODUCING NIG. UNLIMITED VS. LAGOS STATE ENV. PROTECTION AGENCY (2002) 12 SC (Pt.1) 26.

The court is urged to equally resolve issue No.2 in favour of the 2nd Respondent.

Regarding issue No. 3, it was submitted that the conditional stay of execution granted by the Tribunal had expired. Thus, there was no stay of execution when the lower court granted the Garnishee order. That, an order of stay of execution of judgment does not preclude a judgment Creditor from seeking to use garnishee proceedings to enforce the judgment. See UBA PLC VS. EKANEM (2009) 40 WRN 150 at 167; PURIFICATION TECHNIQUES (NIG) LTD VS. AG LAGOS STATE (2004) 9 NWLR (Pt.879) 665.

The court is urged to equally resolve issue No. 3 in favour of the 2nd Respondent.
On the whole, the court has been urged upon to accordingly dismiss the appeal.

I have amply considered the nature and circumstances surrounding the appeal, the submissions of the learned counsel, contained in their respective briefs of argument vis-‘a-vis the record of appeal, as a whole. The three issues raised in the respective briefs of argument of the parties are not at all mutually exclusive.

I would want to believe that the three issues formulated in the Appellant’s brief are apt and more concise those formulated in the Respondents’ brief. Thus, I hereby adopt them for the determination of the appeal. I will, however, start with issue No.2 which appears to have raised the fundamental question of jurisdiction.

ISSUE NO. 2
As alluded to above, the issue No.2 of the Appellant raises the vexed question of whether or not the court below was right in assuming jurisdiction in the matter, when the conditions precedent stipulated by statutes were not fulfilled by the 1st Respondent (Judgment Creditor). The issue was stated to have been distilled from ground 3 of the notice of appeal.

Undoubtedly, by the wordings thereof, the issue No.2 raises a question that has to do with the third ingredient of the principle in question, viz:
“(c) the case is initiated by the due process of the law and upon fulfillment of condition precedent to the exercise of jurisdiction.”

Instructively, the provision of Section 51 of the National Insurance Act (supra) is to the following effect:
51. Legal Proceedings
(1) No Suit shall be commenced against the commission before the expiration of a period of 30 days after written notice of intention to commence the suit shall have been served on the commission by the intending Plaintiff or his agent, and the notice shall clearly and explicitly state –
(a) the cause of action;
(b) the particulars of the claim;
(c) the name and place of abode of the intending Plaintiff; and
(d) the relief which it claims.
What’s more, the Act equally provides under the said Section 51 thereof to the following effect:
(3) In an action or suit against the commission, no execution or attachment or process in the nature thereof shall be issued against the commission, but any sums of money which may, by the judgment of the court, be awarded against the commission shall, subject to any directives given by the commission, be paid from the general reserve of the commission.
Undoubtedly, such statutory rules of procedure are not in themselves unconstitutional or even irregular, per se. A pre-action notice, is duly recognized as a veritable procedural provision. However, as in every given general principle, there may be an exception. The exception comes into play where the particular requirement is prejudicial by constituting an infringement of the exercise of judicial power by the courts; or where the pre-action notice tends to abridge the citizen’s right of access to the court, thereby being inconsistent with the Constitution of the Federal Republic of Nigeria, 1999, as amended.  See AMADI VS. NNPC (2000) 10 NWLR (Pt. 674) 76, where it was emphatically held by the Supreme Court, thus –
Regulations of the right to access to the court abound in the rules of procedure and are legitimate… where (however) an enactment regulates the right of access to the court in a manner to constitute an improper obstacle to access to court, such enactment could be appropriately regarded as an infringement of Section 33 (1) rather than infringement of Section 6 of the Constitution. See Per Kari bi-whyte, JSC, at 110-111 paragraphs B – B (Brackets added).
It is equally trite, that the main object of pre-action notice is to accord the (potential) Defendant a breathing time so as to enable him to determine whether he should make any preparation regarding the Plaintiff’s claim. So it was aptly held by the Apex court in a plethora of authorities, including the following: NGELEGLA VS. TRIBAL AUTHORITY, NONGOWA CHIEF DOM (1953) 14 WACA 325 @ 327. See also ATOLAGBE VS. AWUNI (1997) 9 NWLR (Pt. 522) 536.
The case of AMADI VS. NNPC (supra), was predicated upon the provision of Section 11(2) of the NNPC ACT, 1977, which is to the following effect:
11. (1) Notwithstanding anything in any other enactment, no suit against the Corporation, a member of the Board or any employee of the Corporation for any act done in pursuance or execution of any enactment or law, or of any public duties or authority, or in respect of any alleged neglect or default in the execution of such enactment or law, or of any public duties or authority, shall lie or be instituted in any court unless it is commenced within twelve months next after the act, neglect or default complained of or, in the case of a continuance of damage or injury, within twelve months next after the ceasing thereof.
(2) No suit shall be commenced against the Corporation before the expiration of a period of one month after written notice of intention to commence the suit shall have been served upon the Corporation by the intending plaintiff or his agent; and the notice shall clearly and explicitly state the cause of action, the particulars of the claim, the name and place of abode of the intending plaintiff and the relief which he claims.
It’s pertinent to reiterate, that the provisions of Section 11 (1) & (2) of the NNPC Act 1977 (supra), upon which the decision of the Apex court in AMADI VS. NNPC (supra) was based is in pari-materia with Section 51 (1) & (2) of the National Insurance Commission Act, 2004. The Apex court’s unanimous decision in AMADI VS. NNPC (supra) is to the effect, inter alia, that a pre-action notice is a precondition precedent to the institution (or commencing) of an action or suit against the Defendant.
In the instant case, the phrase –
“No suit shall be commenced…”
as couched in Section 51 (2) of NAICOM Act (supra), arguably connotes an obligation, as the word “shall” therein is rather mandatory. Thus, the implication being that no suit or action could be validly instituted (commenced) against the present Appellant in any court unless a pre-action notice is served thereupon. And that in the event of being duly served upon the Appellant, a suit can only validly be  instituted or commenced against the Appellant after the expiration of 30 days after the pre-action notice was served upon the Appellant. See AMADI VS. NNPC (supra), wherein the Supreme Court held that –
while the issuance of the notice by a prospective Plaintiff is mandatory, the particulars to be included in the notice which are cause of action particulars of claim, name and place of abode, of the intending Plaintiff and the relief to be claimed – appear to me to be declaratory. Per Uwais, CJN at 98 paragraph D.
What’s more, in the case of KATSINA LOCAL GOVERNEMT VS. MAKUDAWA (1971) 1 NWLR 100 @ 107 (approvingly referred to in AMADI VS. NNPC), the Supreme Court held that the purpose of giving notice of claim to the Local Government against it was to guard against being taken by surprise, and to have adequate time to prepare to deal with the defence thereto. According to the Apex Court, the purpose of a pre-action notice –
“is not to put hazards in the way of bringing litigation against it.” Per Coke, JSC.
It is equally a trite principle, that the term “shall” when used in an enactment is capable of bearing more than one meaning. The word “shall” may sometimes imply futurity. It may imply a mandate; an obligation. It may equally imply a direction, or giving permission (to do something). See IFEZUE VS. MBADUGHA (1984) 1 SC NLR 427 at 456 – 457.
As a fundamental principle, the word “shall”, where ever used in a mandatory sense, then the action required must be exactly carried out, obeyed or fulfilled, in accordance with the spirit and intendment of the command. Contrariwise, if the word “shall” is used in a directory sense, then the action required is to be obeyed, carried out, or fulfilled in substantial compliance with the directive. See WOOD VS. SARSONS (1875) LR 10 CP 733 @ 746; POPE VS. CLARK (1953) 1 WLR 1060; JULIUS VS. LORD BISHOP OF OXFORD (1880) 5 AC (HL) 214 @ 222; 235; STATE VS. KORI (1983) 1 SC NLR 94 @ 110; LIVER POOL BOROUGH BANK VS. TURNER (1861) 30 LJ CH. 379 @ 657.
Interestingly, all the aforementioned authorities (referred to in AMADI VS. NNPC by Uwai, CJN) have lent a credence to the inviolability of the well cherished doctrine of interpretation. Most particularly, in the case of LIVERPOOL BOROUGH BANK VS. TURNER (supra), it was aptly held, over one and a half decades ago, that –
No universal rule can be laid for the construction of statutes as to whether mandatory enactments shall be considered directory only or obligation with an implied nullification for disobedience. It is the duty of courts of justice to try and get at the real intention of the legislature by carefully attending to the whole scope of the statute to be construed.
In a nutshell, the applicability of “shall”, either as mandatory or directory, invariably depends upon the statutory con in which it is used.
In the instant case, being strictly guided by the wise and authoritative dictums of the Supreme Court, alluded to in the various decisions above, I have no hesitation whatsoever in holding that the word shall as couched in Section 51 (1) & (2) of the National Insurance Commission Act (supra) is mandatory, in every sense thereof.
At this point in time, I have deemed it expedient to pose the pertinent question: whether or not the mandatory provision of Section 51 (1) & (2) of the NAICOM Act (supra) has infact been complied with by the 1st Respondent (Judgment Creditor). I do not think that the answer to that pertinent question is far to seek.
The 1st Respondent has in the brief thereof, especially at page 6 paragraph 5.3, submitted that –
“5.3 Issue of Service of pre-action notice and consent of the Attorney General is an irregularity which the Appellant has indeed waived in this case. This does not affect the jurisdiction of the lower court to adjudicate.”
Admittedly, I must commend the 1st Respondent learned counsel’s remarkable exposition of the relevant authorities in support of the aforementioned contention thereof. Most particularly, the learned counsel has cited and relied upon (i) EZE VS OKECHUKWU (supra); (ii) FOOD & FOOD FARMS (NIG) LTD VS NNPC (supra); and indeed (iii) MOBILE PRODUCING UNLIMITED VS. LAGOS STATE ENVIRONMENTAL PROTECTION AGENCY (supra), respectively.
In the aforementioned authorities, especially EZE VS. OKECHUKWU (supra) and FEED & FEED FARMS (NIG) LT VS NNPC (supra), the Supreme Court made a  far reaching distinction of the circumstances in which a court lacks original jurisdiction or constitutional jurisdiction to entertain and determine a matter. And other circumstances, where due to operation of law, the jurisdiction is either whittled down, ousted (taken away), or merely temporally put on hold pending the compliance (fulfillment of) with certain basic condition or pre-action condition. As held by the Supreme Court in EZE VS. OKECHUKWU (supra) –
As I understand the position, these authorities cited by the appellant and others like them are in applicable to the present case but concerned with situations where a court cannot exercise jurisdiction at all over a matter to give a valid decision as a result of a statutory or constitutional provision which delimits its jurisdiction to exclude or not to include the subject matter; or abrogates the right of a Plaintiff to approach the court or defeats his cause of action, for instance, statute of limitation.
Per Uwaifo, JSC at 110 paragraphs 5 – 10.
The learned erudite jurist goes further to hold in EZE VS. OKECHUKWU (supra) thus:
However, the competence of the action as a result of non service of pre-action notice resulting in the court being able to exercise its jurisdiction on to proceed with the hearing is an irregularity which is not such that cannot be waived by the Defendant who has failed to raise it by motion or plead in the statement of defence. It is different from total lack of jurisdiction in the court. Both situations should be separately analysed when relying on and considering relevant authorities dealing with the incompetence as I have attempted to demonstrate earlier on. Per Uwaifo, JSC at 112 paragraphs 5 – 10.
I have no hesitation, whatsoever, in upholding the contention of the 1st Respondent, to the extent that the issue of pre-action notice, as a right, is an irregularity which may be waived by the Defendant. However, I would want to reiterate for the avoidance of any lingering doubt, that the pre-action, as an irregularity is capable of being deemed waived by the Defendant only in cases where the right involved is either ‘personal’ or ‘domestic’. However, where the right involved is neither personal, nor domestic, but of public importance (as in the instant case), then the court ought not to deem the pre-action right as having been abandoned by the Defendant. As emphatically held by the Supreme Court-
For purposes of waiver, matters affecting the jurisdiction of the court should be categorized in two areas or compartments. These are jurisdictional matters affecting the public in the litigation process and those affecting the personal, private or domestic rights of the party. While the former cannot in law be waived, the latter can be waived in law.
Inarguably, in the present case it’s rather obvious, that the right involved in question is not merely a personal or domestic right of the Appellant or the 3rd Respondent.
No, indeed, it’s a public right! The right of the insuring public to ensure the preservation of insurance asset duly established by the law for the security there of is undoubtedly very much at stake. Thus, the Appellant being not directly a beneficiary of such a right, lacks the power or competence to waive it.

What’s more, the 1st Respondent has not been forthcoming in explaining any compelling reason why she failed to give the pre-action to the Appellant as duty required by law. Thus, in the light of the foregoing postulations, I have no hesitation whatsoever in answering the issue No. 2 in the negative, and accordingly resolving same in favour of the Appellant.

ISSUE NO. 3
Arguably, the issue No. 3 seems to be closely related to issue No.2, as it equally raises the vexed question of whether or not the Garnishee order was in itself competent on the ground that there-
Was an appeal, pending on the judgment upon which it was based and when a stay of execution of the judgment had been obtained and for violating Section 5 1(3) of the National Insurance Commission Act, CAP N53, 2004 LFN and the Central Bank of Nigeria Act, CAP. C53, 2004 LFN and the Central Bank of Nigeria Act, CAP. C4, 200 LFN.

Undoubtedly, by virtue of the provisions of Section 83 (1) & (2) of the Sheriffs and Civil Process Act (supra), debts may be attached by a garnishee order duly issued by a court of jurisdictional competence.
Thus, by virtue of Section 83 (1) (supra), it’s not at all in doubt, that a court of competent jurisdiction can grant garnishee orders Nisi and absolute, to attach the debt owing and due from a third party who is indebted to the judgment debtor, thereby paying such money to the judgment creditor. See CBN VS. AUTO IMPORT EXPORT (2013) 2 NWLR (Pt. 1337) 80, wherein this court emphatically reiterated the fundamental doctrine thus:
For a garnishee proceedings to be valid, it is in arm bent upon the trial court to ensure that the following conclusions have been duly satisfied:-
(i) That the garnishee must be indebted to the judgment creditor within the state and be resident in the state in which the proceedings are to be brought. As such, if the debt is owed by some one outside the state, the proceedings are inapplicable.
(ii) The proceedings should be filed, in any court in which the judgment debtor could, under the High Court (Civil Procedure) Rules or under the appropriate Section or Rule governing civilian magistrates courts, as the case may be sue the garnishee in respect of the debt. Thus, the court may not necessarily have to be the one that gave the judgment. It could be a magistrates court and the fact that the debt exceeds the jurisdiction thereof notwithstanding.
(iii) The application for the garnishee order shall be made ex parte. The court if satisfied that the judgment creditor is distilled to attach the debt, shall make a garnishee order Nisi. See order 8 Rule 3 (2).
(iv) The service of the order nisi thereon finds or attaches the debt in hands of the garnishee. Section 85 of the Sheriffs And Civil Process Act (supra).
Per Saulawa, JCA, at 128 paragraphs A – D. See also BLACK’S LAW DICTIONARY, 9th edition, 2009 at 749 – 750; UBA LTD VS. SGB LTD (1996) 10 NWLR (Pt. 708) 115 at 390; DUNLOP VS HANDALL (19957) 3 ALL ER 344; 347; WEB VS. STENTION (1883) 11 QBD 518; HOLLIBLY VS. HOLDGSON (1889) 24 QBD 103 at 108.
It is trite, that the Appellant came into possession of the deposit in question pursuant to Section 11 of the Insurance Act 2003 CAP. 117 LFN 2004 as amended, which is to the following effect:
(1) An insurer intending to commence or continue to carry on insurance business in Nigeria after the commencement of this Act shall –
(a) deposit the share capital referred to in Section 10 of this Act (in this Act referred to as “the statutory deposit”) with the Central Bank;
(b) Keep deposited with the Central Bank, the statutory deposit at all times during which the insurer is lawfully carrying on insurance business in Nigeria under or pursuant to the provisions of this Act.
Under Section 51 (1) of the National Insurance Commission Act (supra), it has been provided that no suit shall be instituted against the Appellant before the expiration of a period of 30 days, after written notice of intention to commence the action shall have been duly served on the Appellant by the intending Plaintiff (1st Respondent) or agent thereof. And the notice of pre-action shall clearly and explicitly state –
(a) The cause of action;
(b) The particulars of the claim;
(c) The home and place of the abode of the intending Plaintiff; and
(d) The relief which it claims.
fortiori, by virtue of subsection (3) of Section 51 of the National insurance Commission Act (supra), in any action or suit against the commission (Appellant) –
No execution or attachment or process in the nature thereof shall be issued against the commission, but any services of money which may by the judgment of the Court be awarded against the commission shall, subject to any directives by the commission, be paid from the general reserve of the commission.
The provision of the law is explicit and rather unequivocal! The Appellant being a public institution, ought to have been put on notice before the garnishee action was commenced at the court below. Thus, having failed to serve the said pre-action notice (a condition precedent) within the stipulated statutory time limit in question, the entire garnishee proceedings surresptitiously put in motion by the 1st Respondent, and embarked upon by the court is a nullity, and of no effect what so ever. And I so hold.

Equally germaine to issue No.3, is the question of the pending appeal and motion for stay of execution against the Tribunal’s judgment in question.

However, execution of judgment by way of outright seizure of goods or levy of execution upon immovable property of judgment debtor is different from attachment of debt owed to a judgment debtor by a third party, who is not in any way indebted to the judgment creditor. Enforcement of judgment by way of writ of execution have been provided for under Sections 19 – 54 of the Sheriffs and Civil Process Act (supra). By virtue of Section 2 of the Act:
Any sum of money payable under a judgment of a court may be recovered, in case of default or failure of payment thereof forthwith or at the time or times and in the manner thereby directed, by execution against the goods and chattels and the immovable property of the judgment debtor in accordance with the provisions of this Act.
Contrariwise, the procedure for the attachment of debts by garnishee proceedings is provided for under Sections 83, 92 of the Sheriffs and Civil Process Act (supra). And by virtue of Section 83 of the Act, the court may, upon the ex parte application of any person who is entitled to the benefit of a judgment for the recovery or payment of money, order that debts owing from such third person (called garnishee), to such debtor shall be attached to satisfy the judgment or order, together with the costs of the garnishee proceedings.
It is trite, that for a garnishee proceedings to be valid, it behoves the trial court to ensure that the five basic conditions set out in the case of CBN VS. AUTO IMPORT EXPORT (supra) copiously alluded to above.
The execution in garnishee proceedings is levied against the garnishee only, and not against the judgment debtor. See UBA PLC VS. EKANEM (supra)at 165 paragraphs 25 – 30.
In the instant case, the notice of appeal, filed on 21/08/06, is contained at pages 146 to 153 of the Record. It should be reiterated, that in a garnishee proceedings, a judgment debtor is merely a nominal party whose money purportedly in the custody of the garnishee is being attached, and recovered by the judgment debt.
Essentially, it’s the garnishee who is required to appear before the court to show cause why the order nisi should not be made absolute. Thus, it’s only the garnishee who is under a duty to inform the court if there is any third party’s interest in the judgment debtor’s money in the custody thereof. In the event of failure to comply with the law, it’s the garnishee who is expected to react, and not the judgment debtor.

In the instant case, it’s rather obvious, that the motion on notice, contained at pages 139 to 141 of the Record, and the affidavit in support thereof were filed by the judgment debtor (the 2nd Respondent). As alluded to above, the 2nd Respondent cannot file an application seeking stay of execution of judgment in a garnishee proceedings. It was aptly held by this court that –
A motion by the judgment debtor to stay execution of the garnishee order is tantamount to being a meddlesome interloper. It is left for the garnishee bank that is dissatisfied with an order nisi to apply to court giving reasons why the order nisi should not be made absolute. Such reasons could include the fact that the judgment debtor does not have the assets said to be in the custody of the bank. See UBA PLC VS. EKANEM (supra) at 169 Paragraph 45 Per Akaahs, JCA (as he then was).
In the case of STB LTD VS. CONTRACT RESOURCES (NIG) LTD (2001) 6 NWLR (Pt.708) 115 at 126 paragraphs A – D, it was held by this court that –
Filing of an appeal does not ipso facto operate as a stay of execution of the decision appealed against. Where, however, the Appellant as in the instant case, had filed, in addition, an application for the variation of the conditions of stay as imposed by the trial court it becomes most desirable for both parties and the trial court to ensure that no fait accompli is thrust upon the appellate court. In the instant case, the application for stay and in addition to the appeal filed by the applicant was improper. Indeed, such a prayer by the judgment creditor for decree nisi was incompetent. (Nigerite Ltd Vs. Dalami Nig. Ltd (1982) 7 NWLR (Pt. 253) 288; University of Nigeria Nsukka Vs. Oazulike Trading Company (1989) 5 NWLR (Pt. 119) 19; Egbo Vs. Laguna (1988) 3 NWLR (Pt. 80) 109.
I think, I cannot agree more with the above apt decision of this court. Undoubtedly, the facts and circumstances of the instant case are on all fours with those in STB LTD VS. CONTRACT RESOURCES LTD (supra). In the instant case, it’s rather obvious that the lower Tribunal had granted a conditional stay of the execution of the judgment in question pending appeal to this court.

However, most curiously, the 1st Respondent, rather than pursuing the appeal and the application for stay of execution of the judgment of the lower Tribunal opted, for reasons best known thereto, to file the garnishee applications in the lower court. Yet, even more curiously, the lower court deemed it expedient to oblige the 1st Respondent and grant the garnishee orders nisi and absolute in question.

In the circumstances of this case, there is every cogent reason for me to hold, that the garnishee process of the lower court have amounted to an abuse of process. And I so hold! Thus, the inevitable answer to the issue No.3 is to the effect that the Garnishee order is incompetent. The said issue No.3 is hereby accordingly resolved in favour of the Appellant.

In the light of the above postulations, and having regard to the fact that both issues 2 & 3 have been resolved in favour of the Appellant, there is no gainsaying the fact, that the appeal is meritorious, thus ought to be allowed by this court. Having determined that the entire garnishee process filed in the lower court is grossly incompetent, thereby depriving the court of the jurisdictional competence to entertain same, it would amount to a sheer academic exercise for me to proceed to determine issue No. 1 on the merits. And I so hold!

Hence, having resolved both issues 2 & 3 in favour of the Appellant, I have no hesitation in coming to the inevitable consideration to the effect that the appeal is meritorious. The appeal is accordingly hereby allowed by me. Consequently the ruling of the Federal High Court, which was delivered by the Hon. Justice C.E. Archibong on July 21, 2008 in suit No. NRJ/L/06/2006, is hereby set aside.
There shall be no order as to costs.

JOSEPH SHAGBAOR IKYEGH, J.C.A.: I had the honour of reading in draft the thorough judgment of my learned and respected brother, Ibrahim Mohammad Musa Saulawa, J.C.A., in which I fully concur and gratefully adopt as my judgment with these few words.

First the court below was not cautious in handling the garnishee proceeding. In my view, elementary circumspection on the part of the court below would have alerted it to the fact that the garnishee proceeding before it was abuse of its process having regard to the prevailing position on ground that an appeal was pending against the judgment sought to be enforced by way of garnishee proceeding and a conditional stay of execution of the judgment was earlier granted by the court below.

Also, the court below failed to take into account the fact that pre-action notice as required by the mandatory provision of Section 51(1) and (2) of the National Insurance Act ably treated in the lead judgment of my learned brother, Saulawa, J.C.A., was not served on the appellant before the garnishee proceeding commenced against her.

For the avoidance of doubt, the compulsory tenor of Section 51(1) of the National Insurance Act states in part that –
“No suit shall be commenced against the commission before the expiration of a period of 30 days after written notice of intention to commence the suit shall have been served on the commission by the intending plaintiff or his agent…”

A “suit” for the purpose of pre-action notice was held in the case of Saftu v. Kaduna Native Authority (1969) 1 NMLR 129 per the judgment of the legendary jurist Bellow, S.P.J. (later C.J.N., but now of blessed memory) to include an application or motion for an injunction or suit in equity, Black’s Law Dictionary (Eighth Edition) page 1475 also defines a suit as any proceeding by a party or parties against another in a court of law. Further in A.C.B. Plc v. Ugorji (2002) FWLR (Pt.93) 1893 at 1897, a ‘suit’ was held to include a motion.

Considering the fact that the money with the appellant which the garnishee order attached were deposit belonging to the public and thus qualified as public fund in contra-distinction to money from the general reserve of the appellant commission, consent of the Attorney-General of the Federation should have been sought and obtained by the judgment creditor before initiating the garnishee proceeding at the court below – See Onjewu v. Kogi State Ministry of Commerce and Industries and Ors. (2003) 10 NWLR (Pt.827) 41.

For the reasons given above and the detailed reasons contained in the lead judgment, I am surprised that the court below acceded to the garnishee application of the judgment creditor. I would allow the appeal and set aside the ruling of the court below granting the judgment creditor an order of garnishee absolute to the fiscal detriment of the appellant. Parties to bear their costs.

RITA NOSAKHARE PEMU, J.C.A.: I had read in draft, the judgment just delivered by my brother I. M. M. SAULAWA JCA. I agree with the reasoning and conclusions.

The appeal is allowed by me and the Ruling of the Federal High Court, Coram C. E. Archibong J., delivered on the 21st of July, 2008 in Suit No.NRJ/L/06/2006 is hereby set aside.

I abide by the consequential order made in lead judgment that there shall be no order as to costs.

Appearances

Prof. M. O. Adeyemi With Lanre OnegozuwaFor Appellant

AND

E. A. Oyebanji With AransiolaFor Respondent