ROBERTSON GROUP PLC v. GEO GROUP LIMITED
In The Court of Appeal of Nigeria
On Monday, the 17th day of June, 2002
RAPHAEL OLUFEMI ROWLAND Justice of The Court of Appeal of Nigeria
BABA ALKALI BA’ABA Justice of The Court of Appeal of Nigeria
KUMAI BAYANG AKAAHS Justice of The Court of Appeal of Nigeria
ROBERTSON GROUP PLCAppellant(s)
GEO GROUP LIMITEDRespondent(s)
AKAAHS, J.C.A. (Delivering the Leading Judgment): This is an interlocutory appeal against the Ruling of the Edo State High Court, holden at Benin, in Suit No. B/142/96 delivered on 7/5/98, in an application brought by the plaintiff now respondent requiring the appellant as defendant to deposit the sum of N10 million as security for purposes of securing the appearance of the defendant/appellant to answer and satisfy any judgment that may be passed against it. The court granted the application and made an order directing the defendant/appellant to deposit the sum of N5,000,000.00 with the Chief Registrar of the High Court of Justice Benin City, within 45 days from the date of the order which sum is to be deposited in an interest yielding account with the Union Bank of Nigeria Plc, Akpakpava Street Branch, Benin City, for the said purpose of ensuring the defendant’s appearance to satisfy any judgment that may be passed in the suit. Being dissatisfied with the ruling, the defendant appealed against it on two grounds from which the following two issues were distilled, namely:
(1) Whether the decision contained in the ruling of the trial Judge directing the appellant to deposit the sum of N5,000,000 with the Chief Registrar of the High Court of Justice Benin City, for purposes of ensuring appellant’s appearance to satisfy any judgment that may be passed against it in this suit was properly made under Order 15 rule 1 of the Edo State High Court (Civil Procedure) Rules, 1988.
(2) Whether a defendant’s failure to appear to a proceedings in person makes him an absconding defendant, within the meaning of the provisions of Order 15 rule 1 of the Edo State High Court (Civil Procedure) Rules, 1988, notwithstanding his appearance through counsel.
The respondent adopted the issues formulated by the appellant in its brief of argument.
On 15/4/2002, when the appeal was called for hearing, it was only Mr. Ajumogobia, learned Counsel for the appellant that was present in court. But since parties had filed their briefs, and there was confirmation that hearing notice had been served on the respondent, this court invoked Order 6 rule 9(e) Court of Appeal Rules, 1981 (as amended), to deem the appeal as having been argued on the briefs. Thereafter, learned Counsel adopted the appellant’s brief. In profering arguments on the first issue Mr. Ajumogobia, learned Counsel for the appellant referred to Order 15 rule 1 Edo State High Court (Civil Procedure) Rules, 1988, and stated that it is common ground that the appellant is a U.K. based company, which has since the inception of this suit been appearing in the proceedings by counsel. He also stated that it is not in dispute that the appellant being ordinarily resident in the U.K., has never been within the jurisdiction, neither did it have assets within the jurisdiction, which it could have removed or attempted to remove from the jurisdiction. Ironically however, this was the very basis for the motion for security viz that the appellant was not within the jurisdiction and had no assets within jurisdiction to satisfy a judgment in favour of the respondent. He pointed out that nowhere in the amended pleadings of the parties or in the affidavit in support was it averred or deposed that the appellant had been within jurisdiction and submitted that counsel’s oral submissions cannot amount to evidence of this fact upon which the court could act. Reliance was placed on the case of N.A.B. Ltd. v. Felly Keme Nig. Ltd. (1995) 4 NWLR (Pt. 387) 100.
Continuing his argument, learned counsel referred to the learned trial Judge’s ruling at page 49 lines 9-11 of the records and submitted that the finding is clearly erroneous. He contended that the reliance which the learned trial Judge placed on Oduba v. Houtmangracht (1997) 6 NWLR (Pt. 508) 185, was wrong as he was influenced by irrelevant consideration in his decision to grant the respondent’s application. He therefore, urged the court to hold that the learned trial Judge was in error in making the order of security against the appellant and to set aside the order in its entirety.
On the second issue for consideration, learned counsel submitted that the learned trial Judge attached undue weight to the appellant’s non-personal appearance in court and submitted that its being represented by counsel met the legal requirements and was therefore, sufficient and the issue of power of attorney was a mere surplusage. He therefore, urged us to allow the appeal and set aside the order for security since the lower court exercised its discretion upon a wrong principle which has occasioned miscarriage of Justice and the decision of the learned trial Judge to make the order for security against the appellant was influenced by irrelevant considerations without adverting to all the peculiar facts and circumstances of the case.
Mr. Tunde Olaniyan who prepared the respondent’s brief submitted on the brief that a court can make an order requiring the defendant to furnish security to fulfil any decree that may be passed on him if the plaintiff proves:
(i) That the defendant has shown or exhibited any intention to obstruct or delay execution of any decree that may be passed or;
(ii) That the defendant is about to dispose of his property or any part thereof or is about to remove any such property from the jurisdiction.
The case of BEPCO Ltd. v. NASCO Management Services Ltd. (1993) 7 NWLR (Pt. 305) 369, was cited by learned Counsel in support of the submission. Learned Counsel argued in the brief that the parties entered into a joint venture agreement to provide petroleum support services to companies in the petroleum industry in Nigeria, from which the appellant later pulled out. It was canvassed that the Joint Venture Agreement effectively brought the appellant within the pale of Nigerian courts jurisdiction, since the appellant was doing business in the country at that time and the withdrawal of the appellant from the Joint Venture Agreement occasioned a withdrawal or removal of its assets from jurisdiction. Learned Counsel suggested that the import of a defendant having assets within the jurisdiction is basically to ensure that the plaintiff has something to hold on to within jurisdiction in the event that judgment is given in the plaintiff’s favour. He then submitted that the conditions necessary for the grant of the court’s order were met and the court properly exercised its discretion in allowing the application.
On the issue of the appellant’s absence, learned Counsel contended that the rule which allows a party to be represented by counsel is not absolute as some occasions demand the attendance of the party in person and cited the case of Sanni Kehinde v. Amole Ogunbunmi & Anor. (1968) NMLR 37 as being instructive on the issue. He referred to Aguda: Practice and Procedure of the Supreme Court, Court of Appeal and High Courts of Nigeria to buttress the point that a party’s absence could be treated as non appearance. He gave the instance that the counsel’s representation does not extend to standing in where judgment is to be executed, moreso where counsel is bound by the specific instructions of the client and is compelled to adhere to it as was done in this case by the donation of the power of attorney which was to appear at the hearing of 27th and 28th of November, 1998 and any subsequent adjournment and terminated on 31/5/98. This learned Counsel submission does not extend to guaranteeing the appellant’s attendance to meet the terms of any judgment that may be passed against it and relied on Adewunmi v. Plastex (1986) 3 NWLR (Pt.32) 767. The fact of the appellant being represented by counsel throughout viewed in relation with other circumstances like the appellant’s self confessed going out of trading, reorganisation, change in name and change of address warranted the granting of the order being appealed against. He said it is the duty of the appellant following Barclays Bank DCO v. Sami Makki (1962) LLR 2, to show that from the affidavit filed by the plaintiff/respondent the order should not be made. And because the appellant failed to convince the court that the order should not be made, the presence of the conditions necessary for the grant of the order and the absence of the defendant at the trial that the court rightly viewed in exercising its discretion to make the order in favour of the respondent. He concluded the brief by urging this court to dismiss the appeal, because the decision of the court on the application was considered and based on the correct principle of law and this has not occasioned a miscarriage of Justice and the appeal in itself is a frivolous abuse of courts process which is only aimed at wasting the time of the court.
Order 15 rule 1 of the Bendel State High Court(Civil Procedure) Rules, 1988 applicable to Edo State provides as follows:
“15(1) If in any suit for an amount or value of one thousand naira or upwards, the defendant is about to leave the jurisdiction of the court, or has disposed of or removed from the jurisdiction, his property, or any part thereof, or is about to do so, the plaintiff may, either at the institution of the suit or at any time thereafter until final judgment, make an application to the court that security be taken for the appearance of the defendant to answer and satisfy any judgment that may be passed against him in the suit.”
Before a court can make an order requiring a defendant to furnish security to answer and satisfy any judgment that may be passed against him, the plaintiff must prove:
“(a) that the defendant has shown or exhibited an intention to obstruct or delay execution of any judgment that may be passed against him; or
(b) that the defendant is about to dispose of his property or any part thereof or to remove any such property from the jurisdiction. A similar provision as Order 15 rule 1, Bendel State High Court (Civil Procedure) Rules, 1988, applicable in Edo State is Order 16 rule 1 & 3 of the Plateau State High Court (Civil Procedure) Rules, which was considered in BEPCO Ltd. v. NASCO Management Service Ltd. (1993) 7 NWLR (Pt. 305) 369. The facts in that case were that the respondent as plaintiff at the High Court of Plateau State, Jos Division sued against the defendant/ appellant for the sum of N350,000.00 under the undefended list. Following the filing of a Notice of intention to defend filed by the appellant the suit was transferred to the general cause list. The respondents subsequently filed a motion on notice praying for an order directing the defendant within 7 days to furnish security in the sum of N350,000.00 to fulfil any order the court will make in the substantive action filed by the plaintiff.”
The application although opposed by the appellant, was granted by the learned trial Judge, who then ordered the defendant/appellant to furnish the court with security in the sum of N350,000.00, pending the determination of the substantive suit.
The appellant was aggrieved by the interlocutory order and he appealed to the Court of Appeal which allowed the appeal and set aside the order. It was held that to obtain an order for security for costs the plaintiff should prove the intention of the defendant to obstruct or delay the execution of any judgment which might be passed against him. The mere fact that a defendant proposes to dispose of his property is not sufficient proof of the intention to obstruct or delay the execution of any judgment that may be given against him; and the fact that the defendant’s act would have that effect is immaterial. The applicant must prove the intention of the defendant, and he may be able to do this by inference from all the circumstances of the case. It was further held that the rule is not intended to be used to achieve what amounts to a garnishee order before the judgment.
The Supreme Court Per Iguh, J.S.C. enumerated the principles guiding the exercise of the court’s discretion to order a plaintiff or defendant to give security for costs in Oduba v. Houtmangracht (1997) 6 NWLR (Pt. 508) 185, which was cited by both counsel in support of their stand. He stated at pages 200-201 of the report that the important issues which a court will take into consideration in ordering security for costs are:
“(a) whether the plaintiff’s claim is bona fide and not a sham;
(b) where there is an admission by the defendant on the pleadings or elsewhere in respect of the plaintiff’s claim or alternatively whether the claim has any chance or a reasonable good prospect of success. If there is a strong prima facie presumption that the defendant will fail in his defence to the action, the court may refuse him any security for costs as it may amount to a denial of Justice to order a plaintiff to give security for the costs of a defendant who has no defence to the claim;
(c) whether the plaintiff is a mere nominal plaintiff or is in a condition of poverty or insolvency in which case an order for security for costs may be made;
(d) whether it appears by credible evidence that there is reason to believe that the plaintiff will be unable to pay the costs of the defendant, if his defence is successful in which case an order for security for costs may be considered.
(e) whether the residence of the plaintiff is incorrectly stated in the writ of summons, unless the misstatement is innocent and made without any intention to deceive, an order for security for costs may be considered;
(f) whether a plaintiff is ordinarily resident out of the jurisdiction and has no assets therein which can be reached, though he may be temporarily resident within the jurisdiction and has no assets therein which can be reached, though he may be temporarily resident within the jurisdiction in which case an order for security for costs may be considered; and
(g) whether the application for security for costs is being used oppressively so as to stifle an otherwise genuine claim in which case an order may be refused.”
The provision which was considered in Oduba v. Houtmangracht (supra) was Order 52 rules 1 & 2 of the High Court of Lagos State (Civil Procedure) Rules, 1972 which states:
In any cause or matter in which security for costs is required the security shall be such amount, and be given at such times, and in such manner and form, as the court or a Judge in chambers shall direct.
A plaintiff ordinarily resident out of the jurisdiction may be ordered to give security for costs, though he may be temporarily resident within the jurisdiction.”
Iguh, J.S.C. agreed with the stand taken by the learned trial Judge which was affirmed by the Court of Appeal that where the respondents are foreign companies not resident and with no assets within jurisdiction, the court could invoke Order 52 rule 2 of the High Court of Lagos (Civil Procedure) Rules, 1972, and properly order the respondents to give security for the appellant’s costs. It is a discretion of the court to order a party to give security for costs and the amount of such security which must be exercised judicially and judiciously by having regard to all the circumstances of each case and which must be exercised in good faith, uninfluenced by irrelevant considerations and not arbitrarily or illegally or upon a misconception of the law or under a misconception of the facts. See Aeronave SPA v. Westland Charters Lid. (1971) 1 WLR 1445; Donald Campbell & Co. v. Pollak (1927) A.C. 732; University of Lagos & Anor v. Aigoro (1985) 1 NWLR (Pt. 1) 143 (1985) 1 SC 265 at 271; Ntukidem v. Oko (1986) 5 NWLR (Pt. 45) 909; Nneji & Anor. v. Chukwu & Anor. (1988) 3 NWLR (Pt. 81) 184. A court’s exercise of its discretion without adverting to all the peculiar facts and circumstances of the particular case before it has been said to be as bad as its exercise upon wrong principles. See Leonard Okere v. Titus Nlem (1992) 4 NWLR (Pt. 234) 132.
The appellant in the present appeal has never been within the jurisdiction of this court. This is confirmed by the fact that the plaintiff filed a motion ex parte, dated 29/2/96, seeking leave to issue the writ of summons, statement of claim and other processes on the defendant/appellant who was outside jurisdiction. Leave was also sought to serve the processes on the defendant outside jurisdiction and the address for service was given as Llandudno Gwynedd LL30 1 SA United Kingdom. Paragraphs 2 and 4 of the affidavit in support of the ex parte motion for leave to issue and serve the processes on the appellant deposed to the fact that the appellant was not within jurisdiction since the deponent stated that:
“2. That the defendant herein is a company registered under the laws of the United Kingdom within the Commonwealth and having its principal place of business in Llandudno, Gwynedd, LL30 1 SA.
4. That the defendant herein does not have any branch in Nigeria and can only be served in the above address.”
The arguments advanced by learned Counsel for the respondent to justify the order made by the learned trial Judge that the appellant should provide a security of N5,000,000.00 to satisfy any judgment which may be given against it all tended to portray that the appellant was trying to abscond from the jurisdiction of the court. The appellant had no assets in Nigeria. The grant of the order could not be accommodated under Order 15 rule 1 of the Bendel State High Court (Civil Procedure) Rules, although it can be said that the learned trial Judge exercised his discretion in accordance with the rules of reason and Justice; nonetheless, no material was provided upon which he fixed the amount to be deposited at N5,000,000.00, apart from the fact that the respondent asked for a security of N10,000,000.00. Since there was no admission by the appellant of the plaintiff’s claim coupled with the fact that the appellant had raised a preliminary objection that the action was statute barred, the learned trial Judge was duty bound to examine the pleadings to see whether the claim has any chance or a reasonable good prospect of success. Had the learned trial Judge painstakingly undertaken this scrutiny, I have no doubt in my mind that he would have declined to make the order now being appealed against.
The issue of a party’s appearance in court through counsel has been accepted to substitute personal appearance, by the decision in Adegoke Motors Ltd. v. Adesanya (1989) 3 NWLR (Pt. 109) 250, where the definition of appearance in the “Dictionary or English Law” by Earl Jowitt was adopted. The Supreme Court had earlier construed the word ‘plaintiff’ in Order 26 rule 6 of the High Court Civil Procedure Rules (Western State) to state that there can be no warrant for holding that in Order 26 rule 6(2) of the High Court Civil Procedure, (West) plaintiff means the plaintiff in person and held that it is accepted without question that in a civil suit in the High Court in England, appearance by counsel is enough to satisfy Order 35 rule 1 to which the local rule corresponds. See Kehinde v. Ogunbunmi (1968) NMLR 37. It is within the scope of the ostensible authority of counsel to bind the appellant in the conduct of the case to admit any fact or documents in the course of the proceedings up to 31/5/98. See Tayo Oyetibo & Co. v. Ajose-Adeogun (1996) 6 NWLR (Pt. 452) 29; Adewunmi v. Plastex (1986) 3 NWLR (Pt. 32) 767.
The ruling being appealed against was given on 8/5/98, when the power of attorney donated to counsel by the appellant was still subsisting. It was premature for the learned trial Judge to hold that exhibit IBBI could not be an answer to the issue raised in the application. If the ruling had come after 31/5/98, the learned trial Judge would have been perfectly right to draw the conclusion he did.
In the circumstances, I am of the firm view that it was oppressive of the learned trial Judge to order the appellant to provide a security of N5,000,000.00 within 45 days for the purpose of ensuring its appearance to satisfy any judgment that may be passed in this suit.
At the time the application was taken and the order made, the appellant did not show or exhibit an intention to obstruct or delay execution of any decree of judgment that may be passed; neither did the appellant have any property within jurisdiction which it was about to dispose of or remove outside jurisdiction. From all indications, the order made was intended to be used to achieve what amounted to a garnishee order before judgment which the rule is not meant to serve. It was therefore wrong for the order to be made.
In conclusion, the appeal has merit and it is hereby allowed. I hereby, set aside the order that the appellant give security in the sum of N5,000,000.00 or any amount at all for the purpose of ensuring its appearance to satisfy any judgment that may be passed in suit No. B/142/96. I award the appellant N3,000.00 costs against the respondent.
ROWLAND, J.C.A.: I had the advantage of reading in draft, the judgment just delivered, by my learned brother, Akaahs, J.C.A. I agree entirely with his reasoning and conclusions. The appeal has merit and I hereby, allow it. I abide with the consequential orders in the leading judgment, including the order on costs.
BA’ABA, J.C.A.: I have had the privilege of a preview of the judgment just delivered, by my brother, Akaahs, J.C.A. I agree with my learned brother, that the appeal has merit and should be allowed.
I abide with the consequential orders of my learned brother, including his order on costs.
H.O. Ajumogobia, Esq. (with him, I. Bello, Esq.)For Appellant
Respondent absent and unrepresentedFor Respondent