TWINBELLS INVESTMENT (NIG) LTD & ANOR v. DIAMOND BANK PLC
(2021)LCN/15681(CA)
In the Court of Appeal
(LAGOS JUDICIAL DIVISION)
On Monday, March 29, 2021
CA/L/01/2017
Before Our Lordships:
Joseph Shagbaor Ikyegh Justice of the Court of Appeal
Abubakar Sadiq Umar Justice of the Court of Appeal
Abdullahi Mahmud Bayero Justice of the Court of Appeal
Between
1. TWINBELLS INVESTMENT NIGERIA LIMITED 2. GBADAMOSI IDRIS ADEREMI APPELANT(S)
And
DIAMOND BANK PLC RESPONDENT(S)
RATIO
WHETHER OR NOT ALL PARAGRAPHS OF A STATEMENT OF DEFENCE MUST BE CONSIDERED TO ARRIVE AT THE DEFENCE PEOFERRED BY A DEFENDANT
It was held by the Supreme Court in the case of Apena and Ors. v. Aiyetobi and Ors. (1989) 1 NWLR (pt.95) 85 at 96 relying on the earlier Supreme Court case of Pan Asian Limited v. N.C.O.N. Ltd. (1982) 9 SC 1 at 48 to the effect that, the law is that, it is the cumulative effect of all the paragraphs of the statement of defence that has to be considered to arrive at the defence proffered by the defendants. Or in effect, each paragraph of a statement of defence must not be considered in isolation but in conjunction with the other paragraphs to enable the issues joined in the pleadings to be properly ascertained. PER IKYEGH, J.C.A.
THE POSITION OF LAW ON PLEADINGS
A pleader is also expected to be frank, clear, positive and direct, not hedgy and does not do well by virtually denying everything, including obvious ones, because, justice is not a hide or seek and/or fencing game where one tries to outsmart the other by engaging in the attitude of give her no quarter; deny everything without regard to truth vide Stitch v. A.G., Federation (1986) 5 NWLR (pt.46) 1007 at 1021 – 1022. The case of Olale v. Ekwelendu (1989) 4 NWLR (pt.115) 326 at 359 – 361 further decides it that, the aim of adjudication is to discover the truth as far as that is possible within human limitations, and to find out the true bearing of the law on the facts as pleaded and as made issues from those pleadings, therefore, denials in a statement of defence should be specific and should also deal with the point of substance as the truth or falsehood of each fact is within the knowledge of the defendant and should deal with the real word and not one of make-believe.
The Supreme Court had earlier emphasized in the case of Adimora v. Ajufo (1988) 3 NWLR (pt.80) 1 following the case of Enwezor v. C.B.N. (1976) 3 S.C. 45 at 56, which in turn relied on the English case ofThe Why Not (1868) L.R. 2 A & E 265 (per Phillimore, J.) that pleadings are not to be considered as constituting a game of skill between the advocates or pleaders, but ought to be settled or framed, as not only to assist the party in the statement of his case, but the Court, in its investigation of the truth between the litigants, therefore, the pleader in a statement of defence is expected to place all their cards on the table by admitting what is admissible and deny what is not true in order for the Court, at the end of the exercise, in a good position to ascertain the real matter in controversy and proceed to deal with it.
In traversing a statement of claim by a statement of defence, however, it is not necessary that every paragraph of the statement of claim should be specifically denied. But what is essential is that the case put forward by the defendant conflicts in material particulars with that put forward by the plaintiff and put the different material averments in issue videAjao and Ors. v. Alao & Ors. (1986) 5 NWLR (pt.45) 805 at 827.
The statement of defence (supra), read as a whole or harmoniously as is the case with pleadings, which must be considered together, does not deny or traverse the fact that the 1st appellant was granted loan facility totaling N100 million by the respondent. See Adama v. Kogi State House of Assembly (2019) 16 NWLR (pt.1699) 501 to the effect that pleadings must be read holistically. PER IKYEGH, J.C.A.
WHETHER OR NOT A DEFENDANT WHO DECIDES TO CONTEST AN APPLICATION FOR SUMMARY JUDGEMENT CAN RELY ON A SHAM DEFENCE
It was held by the Supreme Court in the case of Sanusi Brother (Nigeria) Limited v. Cotia Commercio Expartacao E Importacao S. A.(2000) 6 SC (Pt. 111) 43 at 52-54 and 58-59 relying on the cases of Nischizawa Ltd v. Jethwani (1984) 12 SC 234; McLandy v. Slateum (1890) 24 Q.B.D. 504; Macaulay v. Nal. Merchant Bank Ltd (1990) 4 NWLR (Pt. 44) 283; Wallingford v. Mutual Society(1980) 5 App. Cas. 685 at 704; Codd v. Delap (1905) 92 L. T. 810; Re General Rail Syndicate (1900) 1 Ch. 365; F. M. G. v. SAN (1990) 4 NWLR (Pt. 14) 688; Besant v. Townsend 22 L. R. Tr 389; Kanno v. Kanno (1986) 5 NWLR (Pt. 40) 138 that, if a defendant decides to contest an application for summary judgment, he cannot rely on a sham defence but must show a bona fide or good defence on the merits and not engage in manipulative and delaying tactics; that to show a good defence to the claim on the merits, the defendant must disclose facts to condescend upon particulars implying a true and real disclosure of acts from which the Court can readily discern a good defence, not a defence that is frivolous and practically moonshine; that mere general denial of indebtedness would not suffice; that what would suffice is an affidavit stating why the defendant is not indebted in full or in part, and then state the true position; and that in all cases, the defendant must provide sufficient particulars to show that there is a bona fide defence by, as far as possible, dealing specifically with the plaintiff’s claim and affidavit by way of clear and concise defence, as a mere denial by the defendant of the indebtedness, is not enough. See also the cases (supra) cited by the respondent on the issue read with Order 11 Rule 1 of the rules of the Court below. PER IKYEGH, J.C.A
JOSEPH SHAGBAOR IKYEGH, J.C.A. (Delivering the Leading Judgment): The appeal is from a decision of the High Court of Justice of Lagos State (the Court below) whereby it entered summary judgment in the sum of N181,659,620.23 (One Hundred and Eighty-One Million, Six Hundred and Fifty Nine Thousand, Six Hundred and Twenty Naira, Twenty Three Kobo) liquidated demand being money owed the respondent by the appellants as at 30/06/2015 on account of overdraft facility of N100,000,000.00 (One Hundred Million Naira) which the respondent granted the 1st appellant and guaranteed by the 2nd appellant; the appellants were further ordered to pay 23% pre-judgment interest on the judgment sum and 10% post-judgment interest thereon until final liquidation of the judgment debt.
Also, an order of foreclosure of the 2nd appellant’s equity of redemption and for possession by the respondent of the mortgaged property situate at No. 1 Akinbola Street, Ilupeju, Lagos with Deed of Assignment registered as No. 99 at page 99 in volume 2251 of the Land Registry Office Lagos, over which the respondent perfected a Third Party Legal Mortgage, registered as No. 25 at page 25 in volume 2069 at the Land Registry Office, Lagos, was also entered in favour of the respondent, to enable it dispose of the mortgaged property and apply the proceeds to the liquidation of the judgment debt; the cost of N150,000.00 was further awarded against the appellant in favour of the respondent.
In outline, the case of the respondent was that the 1st appellant, as its customer, applied for and was granted an overdraft facility of N100 million with 23% interest rate thereon which was secured by a legal mortgage deed over the property of the 2nd appellant, who was the Managing Director and Chief Executive of the 1st appellant’s company. The overdraft facility was granted in tranches: the first tranche was N30 million, followed by the second tranche of N30 million and the last tranche of N40 million between the months of January, and May, 2012. The overdraft sum of N100 million was released or disbursed to the 1st appellant, which had applied for it, to buy stock. Upon the written request by the 1st appellant, the facility of N100 million was renewed and released to the 1st appellant by the respondent on 21/01/13 backed by Board Resolution of the 1st appellant. Following the default of the 1st appellant to repay the overdraft facility which had ballooned to N181,659,620.23 as at 30/06/2015 when it fell due, the respondent demanded in writing for repayment of the said outstanding sum of money, on pain of foreclosure of the mortgage to which the appellants reneged both on the letters of demand dated 18/04/2013 and 23/01/2014 and on the repayment of the indebtedness.
The appellants’ case in summary was that the overdraft facility of N100 million was not secured with the said property, due to the good business relationship between the parties, and that the only security for the overdraft facility is the 2nd appellant’s personal guarantee and statement of his personal net worth which was attested to by a Notary Public; that the Deed of Assignment in question was deposited in respect of another overdraft facility for the sum of N40 million which is not the subject matter of the instant action; Likewise, the Third Party Legal Mortgage; that the renewal of the overdraft facility was done at the instance of the respondent; that the appellants’ business had suffered serious setback and grave losses owing to the insurgency in the North-East of the Country as most of their customers are based in Maiduguri; and that the appellants had not failed to liquidate the overdraft facility.
The Court below held, in its judgment, that it had carefully considered the affidavit evidence as well as the defence filed by the appellants and other frontloaded documents and noted that the appellants did not place enough and sufficient material evidence for leave to be granted them to defend the action; upon which the Court below entered summary judgment in terms of the action against the appellant.
Not satisfied with the judgment, the appellants filed an original notice of appeal with two grounds of appeal contained in pages 180 – 183 of the record of appeal (the record). An amended notice of appeal with four (4) grounds of appeal was, with the leave of the Court, filed on 30/09/19. The appellants filed their brief of argument on 27/08/19 which was deemed as properly filed and served on 13/01/21.
The appellants relied on the case of Bilateral International Ltd. v. N.D.I.C (2011) 15 NWLR (pt.1270) 407 at 429 to contend that, since they did not admit the indebtedness in question, the respondent had the onus to prove how the debit balance was arrived at, through oral evidence not by merely tendering the statement of action, but to put the statement of account in its proper perspective, by the oral evidence of explaining the entries thereon which the respondents failed to discharge, and was on that account not entitled to summary judgment, so contended the appellants.
The appellants contended that a mere general admission of indebtedness without stating the sum owed, would not be enough to attract summary judgment; that affidavit evidence in a motion takes the place of pleadings which must be proved; and that in this case the appellants, who presented a triable issue on the papers filed by them, should have been allowed to defend the action vide the cases of Veepee Ind. Ltd. v. Cocoa Ind. Ltd. (2008) 13 NWLR (pt.1105) 486 at 509, U.B.N. Plc v. Dawodu (2003) 4 NWLR (pt.810) 287 at 304, Uniben v. K.T. Organisation Ltd. (2007) 14 NWLR (pt.1055) 441 at 462.
The appellants relied on paragraphs 7, 8 and 11 of their statement of defence contained in page 128 of the record and the Deed of Third Party Legal Mortgage contained in pages 31 – 38 thereof, to contend that there was a triable issue to merit the action to be placed on the general cause list as the respondent could not on the strength of their case entitled to summary judgment, more so, the copious reply to the statement of defence contained in pages 141 – 142 of the record warranted the case to be transferred to the general cause list videBodi v. Agyo (2003) 16 NWLR (pt.846) 305 at 321, Veepee Ind. Ltd. v. Cocoa Ind. Ltd. (2008) 13 NWLR (pt.1105) 486 at 519 – 520, Green Finger Agro-Ind. Ltd. v. Yusuf (2003) 12 NWLR (pt.835) 488, Uniben v. K.T. Ors. Ltd. (2007) 14 NWLR (pt.1055) 441 at 473.
The appellants contended that the order of the Court below, for the payment of the overdraft facility and for the foreclosure of the mortgage, amounted to double compensation and thus, is contrary to the definition of security which is furnished to be used in case of failure in the principal obligation vide Black’s Law Dictionary, 6th Edition 1355, Mr. Olusola Adeniji and Sons v. Mr. Alfred U. Agwu(2010) 12 NWLR (pt.1208) 357 at 379.
The appellants also contended that, since the facility has been secured by the 2nd appellant’s property, order for possession and foreclosure becomes an alternative relief, so it was wrong and amounted to a miscarriage of justice for the Court below to have awarded both reliefs instead of in the alternative which rendered its decision perverse, so urged the appellants citing in support the cases of Okonkwo v. Udoh (1997) 9 NWLR (pt.519) 17, Duru v. F.R.N.(2013) 6 NWLR (pt.1351) 441 at 448.
The appellants referred to the statement of claim and the affidavit in support of the motion for summary judgment contained in pages 1–5 and 50–52 of the record, respectively, to contend that the respondent who did not specify or particularise or proved how it came about the 23% pre-judgment interest was wrongly awarded the said pre-judgment interest vide the cases of Idakula v. Richards(2000) FWLR (pt.14) 2443, Skymit Motors Ltd. v. U.B.A. Plc (2012) 2 NWLR (pt.1309) 491 at 497, Adeyemi v. Lan & Baker (200)(?) 7 NWLR (pt.663) 37, Stabilini Visioni Ltd. v. Metalium Ltd. (2008) 9 NWLR (pt.1092) 416 at 419; upon which the appellants urged that the appeal be allowed and the prayers sought by them in the amended notice of appeal be granted.
The respondent filed a brief on 10/07/2020 and deemed as properly filed on 13/01/21 in which it was argued that the affidavit evidence in support of the application for summary judgment, with the 12 Exhibits contained in pages 1–48, 49–98 of the record, was backed by cogent and compelling evidence which the Court below, in line with the purpose of summary judgment which is for the expeditious disposal of claims that are virtually incontestable, properly entered summary judgment as the appellants were unable to disclose defence on the merits in the papers filed in the case vide Order 11 Rules 1 and 4 of the High Court of Lagos State (Civil Procedure) Rules, 2012 (the rules of the Court below) and the cases of Ilomuanya v. Lobi Bank of (Nigeria) Ltd. (1997) 12 NWLR (pt.531) 139 at 148; Macaulay v. Nal Merchant Bank Ltd. (1990) 4 NWLR (pt.144) 283 at 324; Okoro v. Okoro (2010) 2 NWLR (pt.1177) 198 at 208; Thor Limited v. FCMB Ltd. (2005) 14 NWLR (pt.946) 696 at 710 – 713, Carling Int’l (Nig.) Ltd. v. Keystone Bank Ltd. (2017) 9 NWLR (pt.1571) 345 at 363.
The respondent contended that by paragraphs 13 and 14 of the statement of defence contained in page 128 of the record and paragraphs 15 and 16 of the counter affidavit contained in page 135 thereof, the appellants admitted receipt of the loan, therefore, as the onus on the appellants to prove repayment of the loan was not discharged, the Court below was right to enter the summary judgment in question vide Macaulay v. Nal Merchant Bank Ltd. (supra) at 308, Kenfrank (Nig.) Ltd. v. Union Bank of Nigeria Plc (2002) 15 NWLR (pt.789) 46 at 73, Okoli v. Morecab Finance (Nig.) Ltd. (2007) 14 NWLR (pt.1053) 37 at 71.
The respondent contended that, apart from the ipse dixit of the appellants, they failed to attach any documents to show that they repaid the loan, therefore, the Court below was right to enter summary judgment in the cases vide Saleh v. Bank of the North Ltd.(2006) 6 NWLR (pt. 976) 316 at 327, Carling Int’l (Nig.) Ltd. v. Keystone Bank Ltd. (2017) 9 NWLR (pt.1571) 345 at 368, Thor Limited v. FCMB (supra) at 712 – 713.
The respondent contended that paragraph 15 of its affidavit contained in page 51 of the record was not traversed, rather, the appellants, in response to it, pleaded hardship in paragraph 11 of their counter affidavit contained in page 134 of the record which is not a defence to the indebtedness vide Thor Ltd. v. FCMB (supra) at 712 – 713.
The respondent contended that, in the light of the offer letters and demand letters for repayment that accompanied the statement of account, the decision in Bilante Int’l Ltd. v. N.D.I.C. (supra), which relied only on the statement of account and the quantum of the indebtedness was in dispute, was inapplicable and that the Court below was right to enter summary judgment as the general denial of the indebtedness was not enough in the circumstances vide Thor Ltd. v. FCMB (supra).
The respondent contended that the claim was based on the statement of account showing the debit balance of N181,659.520/23 including the debit charges of N17,530,570.07 as at 30/06/2015 without any challenge by the appellant of the entries in the statement of account nor did the appellants dispute the amount contained in the letters of demand, receipt of which they acknowledged vide pages 87, 88 and 89 of the record showing their failure to refute the letters of demand amounted to an admission vide Trade Bank Plc v. Chami (2003) 13 NWLR (pt. 836) 158 at 219–220, Garba Abubakar Bagobiri v. Unity Bank Plc (2016) LPELR–41161, Thor Ltd. v. FCMB Ltd. (supra) at 717.
The respondent contended that the three offer letters contained in pages 53 – 55, 57 and 83 – 85 of the record were tied to the property located at No. 1 Akinbola Street, Ilupeju, Lagos, belonging to the 2nd appellant and that the Third Party Legal Mortgage was over the same property vide pages 74–81 of the record, therefore, the documentary evidence in the case (supra), resolved whatever conflict the appellant purposed to becloud the issue that the mortgaged property was, at all material times, located at No. 1 Akintola Street, Ilupeju Lagos videCarling Int’l (Nig.) Ltd. v. Keystone Bank Ltd. (supra) at 364 – 365, Ilomuanya v. Lobi Bank (Nig.) Ltd. (supra) at 148 – 149, Okoro v. Okoro (supra).
The respondent relied on Order 14 of the rules of the Court below on joinder of causes of action and Nwadialo on Civil Procedure in Nigeria 2nd Edn. 29 and the cases of Salako v. Federal Loans Board (1967) Nigeria Commercial LR 266 at 268, Padawa v. Jatau (2003) 5 NWLR (pt. 813) 247 at 265, Okpalaeke v. NEPA (2003) 14 NWLR (pt. 840) 383 at 401 – 402, Dantata v. Mohammed (2000) 7 NWLR (pt.664) 176 at 197, U.T.C. (Nig.) Plc v. Philips (2012) 6 NWLR (pt.1295) 136 at 184, Agu v. General Oil Ltd. (2015) 17 NWLR (pt.1488) 327 at 341–342 to contend that, as the Court below granted the order for foreclosure of the legal mortgage to enable the respondent dispose of the property and apply the proceeds to liquidate the judgment debt, the award did not amount to double compensation.
The respondent contended that the agreement embodying the 23% pre-judgment interest is contained in pages 83–85 of the record and that the said interest rate was stated in the writ of summons and statement of claim in pages 2 and 5 of the record, respectively, and was thus properly awarded by the Court below vide Ekwunife v. Wayne (W/A) Ltd. (1989) 5 NWLR (pt.122) 422, Texaco Overseas Unlimited v. Pedmar (Nig.) Ltd. (2002) 13 NWLR (pt.785) 526 at 547, Etco (Nig.) Ltd. v. G & T Inv. Ltd. (2011) 3 NWLR (pt.1234) 302 at 319 – 320; upon which the respondent urged that the appeal should be dismissed and the decision of the Court below affirmed.
The appellants’ reply brief was filed on 25/11/2020 but deemed as properly filed on 13/01/21 in which it was contended that the respondent, who asserted the indebtedness, had the onus to establish it regardless of the weakness of the appellant’s case by not attaching documents to their defence vide Section 131(1) of the Evidence Act, 2011 (Evidence Act),Aregbesola v. Oyinlola (2011) 9 NWLR (pt.1253) 458 at 594, Ogoejeofo v. Ogoejeofo (2006) 3 NWLR (pt.966) 205 at 221.
The reply brief added that as the respondent did not reconcile the figures of N164,129,050.17 in December, 2012 to N181,659,620.15 in June, 2015 as contained in the statement of account, same could not be done in the brief as arguments of counsel cannot be substitute for evidence vide U.B.A. Plc v. A.C.B. (Nig.) Ltd. (2005) 12 NWLR (pt.939) 232 at 277–278; and that the respondent merely dumped the statement of account on the Court below without evidence to speak to the document or show how the respondent arrived at its calculation, so the Court below was wrong to enter the summary judgment in question vide Iniama v. Akpabio (2008) 17 NWLR (pt.1116) 238; upon which the appellants urged that the appeal be allowed.
The appellants’ joint statement of defence is contained in pages 127 – 129 of the record as follows –
“STATEMENT OF DEFENCE
SAVE AND EXCEPT as are hereinafter expressly admitted, the defendants deny every allegation of fact contained in the statement of claim as if same were set out seriatim and specifically traversed.
1. The defendants admit the content of paragraphs 1, 2 and 3 of the statement of claim.
2. The defendants deny paragraph 4 and 5 of the statement of claim and state that all unsecured facility of the sum of N30,000,000.00 and another additional N30,000,000.00 unsecured facility were granted.
3. The defendants deny paragraphs 6 of the statement of claim and state the overdraft facility of N60,000,000.00 was unsecured due to the good relationship that exist between the claimant and the defendants.
4. The defendants deny paragraphs 7, 8, and 9 of the statement of claim and state that the enhanced overdraft facility from 60,000,000.00 to 100,000,000.00 was also not secured due to the good business relationship between parties.
5. The defendants admit that the only security for the overdraft facility is the 2nd defendant’s personal guarantee and statement of his personal net worth which was attested to by a notary public and the defendants put the claimant to the strictest proof of the contrary.
6. The defendants do not admit paragraph 11 of the statement of claim and state that no additional security was provided by the 2nd defendant.
7. The defendants state that the 2nd defendant deposited his Deed of Assignment registered as No.99 at page 99 in volume 2251 of the Land Registry in the office at Lagos, his property at No.1, Akingbola Street, Ilupeju, Lagos in respect of another overdraft facility for the sum of N40,000,000.00 which is not the subject matter of this instant suit.
8. The defendants further state that the Third Party Legal Mortgage registered as No.25 at page 25 in volume 2069 of the Land Registry in office at Lagos is in respect of another overdraft facility for the sum of N40,000,000.00 which is not the subject matter of this instant suit. The defendants shall at the trial of this suit rely on the said Third Party Legal Mortgage registered as No.25 at page 25 in volume 2069.
9. The defendants state that contrary to averment in paragraph 12 of the statement of Claim, the defendants’ business has suffered serious setback and grave losses owing to the insurgency in the North East of the Country as most of their customers are based in Maiduguri.
10. The defendants deny paragraphs 13, 14 and 15 of the statement of claim and state that the said renewal and Board resolution were done at instance of the claimant.
11. The defendant deny paragraph 16 of the claim and put the claimant to the strictest proof thereof.
12. The defendant deny the allegation of facts as averred in paragraph 17 of statement of claim and put the claimant to the strictest proof of same.
13. The defendant deny owing the sum of N181,659,620.23 comprising part of principal, interest and charges to the claimant and put the claimant to the very strictest proof thereof.
14. The defendants state that they have not failed to liquidate the overdraft facility of the claimant.
15. The defendants state that the entire claim of contradictory, frivolous and abuse of Court process be dismissed in its entirety”.
It was held by the Supreme Court in the case of Apena and Ors. v. Aiyetobi and Ors. (1989) 1 NWLR (pt.95) 85 at 96 relying on the earlier Supreme Court case of Pan Asian Limited v. N.C.O.N. Ltd. (1982) 9 SC 1 at 48 to the effect that, the law is that, it is the cumulative effect of all the paragraphs of the statement of defence that has to be considered to arrive at the defence proffered by the defendants. Or in effect, each paragraph of a statement of defence must not be considered in isolation but in conjunction with the other paragraphs to enable the issues joined in the pleadings to be properly ascertained.
A pleader is also expected to be frank, clear, positive and direct, not hedgy and does not do well by virtually denying everything, including obvious ones, because, justice is not a hide or seek and/or fencing game where one tries to outsmart the other by engaging in the attitude of give her no quarter; deny everything without regard to truth vide Stitch v. A.G., Federation (1986) 5 NWLR (pt.46) 1007 at 1021 – 1022.
The case of Olale v. Ekwelendu (1989) 4 NWLR (pt.115) 326 at 359 – 361 further decides it that, the aim of adjudication is to discover the truth as far as that is possible within human limitations, and to find out the true bearing of the law on the facts as pleaded and as made issues from those pleadings, therefore, denials in a statement of defence should be specific and should also deal with the point of substance as the truth or falsehood of each fact is within the knowledge of the defendant and should deal with the real word and not one of make-believe.
The Supreme Court had earlier emphasized in the case of Adimora v. Ajufo (1988) 3 NWLR (pt.80) 1 following the case of Enwezor v. C.B.N. (1976) 3 S.C. 45 at 56, which in turn relied on the English case ofThe Why Not (1868) L.R. 2 A & E 265 (per Phillimore, J.) that pleadings are not to be considered as constituting a game of skill between the advocates or pleaders, but ought to be settled or framed, as not only to assist the party in the statement of his case, but the Court, in its investigation of the truth between the litigants, therefore, the pleader in a statement of defence is expected to place all their cards on the table by admitting what is admissible and deny what is not true in order for the Court, at the end of the exercise, in a good position to ascertain the real matter in controversy and proceed to deal with it.
In traversing a statement of claim by a statement of defence, however, it is not necessary that every paragraph of the statement of claim should be specifically denied. But what is essential is that the case put forward by the defendant conflicts in material particulars with that put forward by the plaintiff and put the different material averments in issue videAjao and Ors. v. Alao & Ors. (1986) 5 NWLR (pt.45) 805 at 827.
The statement of defence (supra), read as a whole or harmoniously as is the case with pleadings, which must be considered together, does not deny or traverse the fact that the 1st appellant was granted loan facility totaling N100 million by the respondent. See Adama v. Kogi State House of Assembly (2019) 16 NWLR (pt.1699) 501 to the effect that pleadings must be read holistically.
Similar pattern was followed by the appellants in the statement on oath contained in pages 130–132 of the record and the counter affidavit contained in pages 133–136 of the record. The statement on oath (supra) and the counter affidavit (supra) taken together with the statement of defence (supra) do not, therefore, reveal or disclose a defence to the claim.
There were also documentary Exhibits attached to the action: the offer letter of the credit facility of N30 million representing an increase on the existing N30 million with interest rate of 20% per annum subject to reviews/changes in line with money market conditions and management fee of 2% with personal guarantee of the 2nd appellant and secured by Third Party Legal Mortgage on property located at 7A Sokoto Street, Sabo Oke, Old GRA, Ilorin, which was accepted by the appellants is contained in pages 11-12 of the record.
There is an offer letter of N100 million credit facility upon the request of the appellants contained in pages 13-16 of the record, showing the loan of N100 million was granted to the appellants who accepted it as contained in pages 14-16 of the record in particular, where the appellants used the property of the 2nd appellant located at No. 1 Akinbola Street, Ilupeju, Lagos on Third Party Legal Mortgage as one of the securities for the loan. The interest rate of 20% was attached to the said loan subject to reviews/changes in line with money market conditions. Management fee of 2% was also attached to the said loan. The Board Resolution of the 1st appellant authorizing the loan is contained in page 17 of the record.
The personal guarantee of the 2nd appellant contained in pages 19-24 of the record was given in addition to the Third Party Legal Mortgage in question. There is Deed of Assignment contained in pages 25-30 of the record confirming ownership of the property located at No. 1 Akinbola Street, Ilupeju, Lagos by the 2nd appellant. While the Deed of Third Party Legal Mortgage in question, over the property situate at No. 1 Akinbola Street, Ilupeju, Lagos in respect of the loaned sum of money, is contained in pages 31-38 of the record. There is also the correspondence contained in pages 39-43 of the record, on the application for renewal of the N100 million credit facility at the instance of the appellants which was approved by the respondent. There are further two demand letters for the liquidation of the facility as at 18/04/2013 and 23/01/2014 contained in pages 44-45 of the record.
The statement of account is contained in pages 47-48 of the record with the last entry showing, as at 30/06/2015, the appellants were indebted to the respondent in the sum of N181,659,620.23. These documents, particularly those contained in pages 13-48 of the record, were not controverted by the appellants. The cumulative force of these documents contained in pages 13-48 of the record established, without contradiction or challenge, that the indebtedness of the appellants to the respondent in the sum of N181,659,620.23 as at 30/06/2015 was tied to the Deed of Third Party Legal Mortgage on the property located at No. 1 Akinbola Street, Ilupeju, Lagos and the personal guarantee of the 2nd appellant qua Managing Director of the 1st appellant.
With these uncontroverted documentary evidence, and the wishy-washy or moonshine and/or bare denial of the claim by the appellants in their statement of defence (supra) which amounted to an admission, the Court below was right to hold in part of its judgment in pages 177-178 of the record that: –
“The Honourable Court has carefully considered the entirety of the Affidavit Evidence before it as well as the Statement of Defence filed by the Defendant and other frontloaded documents and I have noted that the Defendants have not placed enough and sufficient material evidence before this Court in line, with Order 11 Rule 4 of the High Court of Lagos State (Civil Procedure) Rules, 2012, on which to anchor the exercise of the Court’s discretion in their favour for leave to be granted to defend the claim.
Since Summary Judgment procedure is designed to facilitate justice especially where the claim is for recovery of debt as in this instant case or liquidated money demand, I have found that the Claimant has established the claims against the Defendant and further that the Defendants have no good defence to same.
Consequently, leave to defend is hereby refused and it is in accordance with settled law that I find that the deposition in the Claimant’s affidavit is admitted by the Defendants and I therefore accept the veracity of the affidavit of the Claimant in support and on this basis, I find and hold that the Claimant’s claims are unassailable and straight forward: and same are with credible evidence namely; the deposition of Ijeoma Emenalo and the Exhibits attached.
Therefore, there is no need to deny the Claimant’s judgment in view of the fact that the Defendant has not presented any bona fide defence or material/triable issue worthy of investigation at a plenary trial.
The Court finds that it would be expedient in the circumstances to enter judgment in favour of the Claimant pursuant to the provisions of Order 11 Rules 1 & 5(2) of the High Court of Lagos State (Civil Procedure) Rules, 2012”.
It was held by the Supreme Court in the case of Sanusi Brother (Nigeria) Limited v. Cotia Commercio Expartacao E Importacao S. A.(2000) 6 SC (Pt. 111) 43 at 52-54 and 58-59 relying on the cases of Nischizawa Ltd v. Jethwani (1984) 12 SC 234; McLandy v. Slateum (1890) 24 Q.B.D. 504; Macaulay v. Nal. Merchant Bank Ltd (1990) 4 NWLR (Pt. 44) 283; Wallingford v. Mutual Society(1980) 5 App. Cas. 685 at 704; Codd v. Delap (1905) 92 L. T. 810; Re General Rail Syndicate (1900) 1 Ch. 365; F. M. G. v. SAN (1990) 4 NWLR (Pt. 14) 688; Besant v. Townsend 22 L. R. Tr 389; Kanno v. Kanno (1986) 5 NWLR (Pt. 40) 138 that, if a defendant decides to contest an application for summary judgment, he cannot rely on a sham defence but must show a bona fide or good defence on the merits and not engage in manipulative and delaying tactics; that to show a good defence to the claim on the merits, the defendant must disclose facts to condescend upon particulars implying a true and real disclosure of acts from which the Court can readily discern a good defence, not a defence that is frivolous and practically moonshine; that mere general denial of indebtedness would not suffice; that what would suffice is an affidavit stating why the defendant is not indebted in full or in part, and then state the true position; and that in all cases, the defendant must provide sufficient particulars to show that there is a bona fide defence by, as far as possible, dealing specifically with the plaintiff’s claim and affidavit by way of clear and concise defence, as a mere denial by the defendant of the indebtedness, is not enough. See also the cases (supra) cited by the respondent on the issue read with Order 11 Rule 1 of the rules of the Court below.
The judgment of the Court below read as a whole does not indicate that the Court below awarded double compensation as the property situate at No. 1 Akinbola Street, Ilupeju, Lagos, covered by the Deed of Third Party Legal Mortgage, was by the order of the Court below contained in part of its judgment in page 179 of the record, to be processed by the respondent to enable it dispose of the property and apply the proceeds thereof to the liquidation of the judgment debt.
In the circumstance, I think that in the event the appellants liquidate the judgment debt, the last resort to the mortgaged property by the respondent for recovery of the judgment sum would no longer hold sway; consequently, the appellants’ contention that the Court below awarded double compensation to the respondent is untenable and is hereby rejected.
As earlier indicated in the discussion, the interest rate on the loan was 20% per annum. I have not seen in the record where the interest rate was reviewed upward to 23% per annum. The Court below should have awarded the 20% pre-judgment interest rate on the loan that had been agreed to by the parties, not the 23% it awarded vide Henkel Chemical Ltd v. A.G. Ferrero & Co. (2003) 4 NWLR (Pt. 810) 306; F.B.N. Plc. v. Excel Plastics Ind. Ltd. (2003) 13 NWLR (Pt. 837) 412; Afribank v. Akwara (2006) 5 NWLR (Pt. 974) 619; R. C. Co. Ltd v. R. P. C. Ltd (2005) 10 NWLR (Pt. 934) 615 and Ekwunife v. Wayne (W/A) Ltd. (supra) to the effect that the pre-judgment interest rate agreed upon by the parties is one of the disjunctive conditions for awarding pre-judgment interest, as in this case.
On the whole, I find the appeal unmeritorious and hereby dismiss it and affirm the judgment of the Court below with variation of the pre-judgment interest rate from 23% to 20% on the principal sum of the judgment sum of N181,659,620.23 to harmonize with the prior agreement of the parties contained in the documentary evidence earlier referred to in the discourse. With respect to the post-judgment interest rate which is provided for under Order 35 Rule 4 of the rules of the Court below, of which the Court can take judicial notice under Section 122 (2) (a) of the Evidence Act without prompt, I agree with the Court below that the respondent is entitled to the post-judgment interest of 10% on the judgment debt and would uphold its decision to that effect. The appellants shall pay N200,000.00 costs to the respondent.
ABUBAKAR SADIQ UMAR, J.C.A.: The draft of the lead judgment, of my learned brother Joseph Shagbaor Ikyegh, JCA was made available to me before now, and for the reasons clearly and meticulously set out therein, which I adopt and hereby dismiss the appeal for being unmeritorious, and abide by the consequential orders made thereat including order to costs.
ABDULLAHI MAHMUD BAYERO, J.C.A.: I agree.
Appearances:
Mr. M. Gbadamosi For Appellant(s)
Mr. N. Omeye For Respondent(s)