UNITED BANK FOR AFRICA PLC v. DOWBEX INTERNATIONAL LIMITED & ANOR
(2018)LCN/12022(CA)
In The Court of Appeal of Nigeria
On Friday, the 27th day of July, 2018
CA/PH/80/2015
RATIO
COURT AND PROCEDURE: ANCILLARY CLAIM
“In UNIVERSITY OF ILORIN TEACHING HOSPITAL V DR. DELE ABEGUNDE (2013) LPELR 21375 (CA) this Court while defining ancillary claim held thus: ”It is trite that where a party’s principal claim fails, the accessory claims that are appendages to it will fail too. This cardinal principle of law was clearly espoused by the Supreme Court in the cases of Fagunwa V Adibi (Supra) and Akinduro V Alaya (2007) 15 NWLR {Pt. 1057} 312. The principle traces its paternity to the Latin Maxim: Accessorium sequitur principale – an accessory thing goes with the principal to which it is incidental to, see Tukur V Government of Gongola State (1989) 4 NWLR {Pt. 117} 517 at 564 – 565”. Per OGBUINYA JCA.” PER BITRUS GYARAZAMA SANGA, J.C.A.
JUSTICES
ISAIAH OLUFEMI AKEJU Justice of The Court of Appeal of Nigeria
CORDELIA IFEOMA JOMBO-OFO Justice of The Court of Appeal of Nigeria
BITRUS GYARAZAMA SANGA Justice of The Court of Appeal of Nigeria
Between
UNITED BANK FOR AFRICA PLC – Appellant(s)
AND
1. DOWBEX INTERNATIONAL LTD
2. MR. GODWIN ROGER OKORUWA – Respondent(s)
BITRUS GYARAZAMA SANGA, J.C.A. (Delivering the Leading Judgment):
This interlocutory appeal emanated from the Ruling of G.K. OLOTU J. of the Federal High Court of Nigeria, Port Harcourt Judicial Division in Suit No. FHC/CS/1289/2007 delivered on 18th March, 2009. The Respondents as Plaintiffs filed an endorsed Writ of Summons and Statement of Claim dated 11th September, 2007 against the Appellant as Defendant seeking for the following:
1: A declaration that the Plaintiffs having paid all moneys (sic) due and agreed upon by the Plaintiffs with the Defendant as full and final settlement of the credit facility subject matter of the Legal Mortgage dated the 26th day of September, 1997 and registered as No. 38 at Page 38 in Volume 234 at the Lands Registry in Port Harcourt, the Plaintiffs are entitled to the return of the Original Certificate of Occupancy dated the 9th day of February, 1997 registered as No. 32 at Page 32 in Volume 236 at the Lands Registry in Port Harcourt which Certificate of Occupancy was held by the Defendant as security for the said credit facility.
2: An Order of Mandatory Injunction compelling the Defendant to deliver up and return to the Plaintiffs without further delay, the Original of the Certificate of Occupancy No. 32 dated 9th of February, 1997 and registered as No. 32 at Page 32 in Volume 236 at Lands Registry Port Harcourt held by the Defendant as security for the credit facility advanced to the 1st Plaintiff which said facility has been fully liquidated.
3: The sum of N1,000,000,000.00 (One Billion Naira) being damages for the unlawful and continuing detention by the Defendant of the Certificate of Occupancy No. 32, dated 9th day of February 1997 and registered as No. 32 at page 32 in Volume 236 at the Lands Registry in Port Harcourt. (the statement of claim is on pages 5 – 11 of the record of appeal).
Attached to the Statement of Claim are several documents marked as Exhibits A, B, C, D, E, F, G, H, J, K, L, M, N, P, Q, R, T, U, V, W and W1 respectively. (The annextures are on pages 12 – 70 of the Records).
On 14th May, 2008 the Defendant filed a Notice of Preliminary Objection. The objector is objecting: –
1: That this Honourable Court lacks the jurisdiction to entertain this suit as presently constituted, in consequence of which the suit is incompetent and should be struck out and/or dismissed.
The grounds upon which the Notice of Preliminary Objection was brought are as follows: –
a) The Federal High Court lacks the jurisdiction to entertain the Claim before this Court.
b) The suit as constituted does not disclose any reasonable cause of action against the Defendant and the Court therefore has no jurisdiction to entertain same.
c) The suit as constituted is otherwise incompetent and constitutes an abuse of the process of Court.
d) In all circumstances of this case the Court has absolutely no jurisdiction to entertain this suit. (pages 71 – 72 of the Records)
An 8 paragraphs affidavit in support accompanied the Notice of Preliminary Objection.
The plaintiffs filed a Counter Affidavit in opposing the notice of preliminary objection containing 9 paragraphs. (pages 75 – 76 of the Records).
The Defendant filed a written address in support of the notice of preliminary objection dated 14th July, 2008. (pages 77 – 85 of the Records). The Plaintiffs also filed a written address in opposition to the notice of preliminary objection dated 23rd September, 2008. (pages 86 – 96 of the Records). The Defendant then filed a Reply on Points of Law dated 24th October, 2008. (pages 97 – 104 of the Records). The learned trial Judge delivered his Ruling on 18th March, 2009. (pages 105 – 114 of the Records).
In his ruling he adopted the two issues formulated by the Defendant as follows: –
1: Whether having regard to the claim and the circumstance of this case, the Federal High Court has jurisdiction to hear and determine this suit.
2: Whether the claim as constituted discloses a cause of action.
On issue 1, learned trial Judge pronounced thus: –
‘From the totality of my findings so far, I hold that the Defendant cannot now use the cover of detinue to request the Court to decline jurisdiction in this matter. I believe that this Court has jurisdiction by virtue of Section 251(1) (d) of the Constitution to hear and determine the Plaintiff’s claim before this Court which I believe is for the enforcement of the terms of the legal mortgage transaction between the plaintiffs and the Defendant. I therefore resolve this first issue in favour of the Plaintiff by holding that this Court has jurisdiction to entertain the plaintiffs’ claims as presently constituted before the Court’.
On issue 2 the learned trial Judge held thus: –
‘I believe that this Deed of Release is the root of the plaintiffs’ claim. It is this Deed of Release that this action seeks to enforce. So really the plaintiffs’ claim is not in detinue as contended by the Defendant. We have seen clearly that the 1st plaintiff has locus standi to institute this action and has reasonable cause of action to seek the enforcement of the Deed of Release and consequently the return of the mortgaged asset’.
The Defendant’s Preliminary Objection lacks merit and it is therefore dismissed with N10,000.00 cost to the plaintiffs.
This decision aggrieved the Defendant. Its counsel filed a Notice of Appeal containing 5 grounds of appeal dated 26th February, 2016 (pages 115 – 118 of the Records). The Notice of Appeal was filed pursuant to an Order of this Court issued on 23rd February, 2015 extending time to the Defendant (14 days) to file their Notice of Appeal. The grounds of appeal, shorn of their particulars, read thus: –
GROUND 1:
The learned trial Judge erred in law when he held that the Federal High Court had jurisdiction under Section 251(1) (d) of the 1999 Constitution to entertain this action.
GROUND 2:
The learned trial Judge misdirected himself in law and came to a wrong conclusion on what the legal issue for determination was in the action.
GROUND 3:
The learned trial Court (sic) erred in law when he held that the plaintiffs have locus standi to institute the action.
GROUND 4:
The learned trial Judge erred in law when he held that the issue relating to mitigation of loss is not a Preliminary point to be taken before trial.
GROUND 5:
The learned trial Judge erred in law when he dismissed the Preliminary Objection as lacking in merit.
The Records of Appeal was compiled at the lower Court and transmitted to this Court on 18th March, 2015. The Appellant’s Brief of argument settled by HELEN OVONLEN Esq. was filed on 5th May, 2015 but deemed as properly filed and served on 9th October, 2017. The Respondents’ Brief of Argument was filed on 27th April, 2016 but also deemed on 9th October, 2017.
The Appellant canvassed three issues out of the 5 grounds of appeal as follows: –
1: Whether having regard to the claim and the circumstances of this case, the Federal High Court has the jurisdiction to hear and determine this suit (Ground 1).
2: Whether the learned trial Judge was right in holding that the issue relating to mitigation of loss is not a preliminary point but an issue to be raised at the substantive trial? (Ground 4)
3: Was the lower Court right in dismissing the preliminary objection? (Grounds 2, 3 and 5)
The Respondents adopted the three issues formulated by Appellants.
While arguing issue 1, learned counsel to the Appellant submitted that the law is trite that jurisdiction of a Court is determined by the subject matter of the suit as endorsed on the Writ of Summons. Cited: OSUN STATE GOVERNMENT -V- DALAMI (NIG.) LTD. (2007) 9 NWLR {Pt. 1038} 66 at 84 – 85 paragraphs H – B. Learned counsel submitted that the plaintiffs’ claim before the lower Court is essentially for damages for failure of the Defendant to return the 2nd plaintiff’s original title document. Learned counsel quoted the plaintiffs claims on page 2 of the record of appeal and submitted that from the averments of the plaintiffs the very action arose as a result of the refusal of the Appellant to return the original title documents to the 2nd Respondent on repayment of the loan. That the primary aim and purpose of the action is simply damages for detinue.
Learned counsel submitted further that on a proper examination of the pleadings of the Plaintiffs particularly paragraphs 17, 23, 24 and 25 of the statement of claim, it will be revealed that the Respondent’s claim in itself is a simple tortuous claim in detinue for which proceedings ought to have been commenced at the State High Court and not the Federal High Court. Learned counsel then reproduced paragraphs 23, 24 and 25 of the Plaintiffs’ Statement of Claim on pages 5 – 11 of the Records. That from the above quoted paragraphs it can be seen that the Plaintiffs’ claim is grounded in the tort of detinue and has nothing to do with mortgage transaction. That although the claim of the Plaintiffs involved a bank as a party, the claim is essentially and primarily a simple tortuous claim in detinue since it is the act of failure to return the 2nd Respondent original title document which gave rise to the cause of action in this suit. That since the cause of action accrued from the date of refusal/neglect to return the title documents then the action is essentially one in detinue. Cited the Supreme Court case of: NEKA B. B. B. MANUFACTURING COMPANY LIMITED V A.C.B. LIMITED (2004) 2 NWLR {Pt. 858} 521 at 565 per UWAIFO JSC that: –
‘The loss of the title document in question in the circumstances, could only give rise to the tort of detinue or conversion’.
Learned counsel submitted that the reliefs sought by the plaintiffs are clearly and indisputably founded in the simple tort of detinue or conversion which should have been filed in the High Court of the State and not the Federal High Court.
Thus the Plaintiffs’ claims are outside the ambit of Section 251(1) (d)of the 1999 Constitution. Cited: 7UP BOTTING COMPANY LTD & ORS V ABIOLA & SONS BOTTING COMPANY LTD (2001) 13 NWLR {Pt. 730} 469; (2001) FWLR {Pt. 70} at 1650. That the 2nd Plaintiff whose title documents are detained by the Appellant is not a customer of the Appellant as shown by paragraph 2 of the statement of claim on page 5 of the records. That it follows therefore that the 2nd plaintiff who is the owner of the title documents, is not a customer of the Appellant so as to bring this action within the proviso to Section 251(1) (d) (Supra). Cited the Supreme Court decision in TRADE BANK PLC V BENILUX (NIG) LTD (2003) 9 NWLR {Pt. 825} 416. Learned counsel urged the Court to hold that the Respondents? claim is in detinue/conversion which is tortuous in nature and cognizable only in the State High Court and not the Federal High Court and resolve this issue in favour of the appellant.
In his submission while arguing this issue, learned counsel to the Respondents agreed that the issue of jurisdiction is best determined from the pleadings in the Statement of Claim. Cited: N.P.A V EYAMBA (2006) All FWLR {Pt. 320} 1022 at 1047; IKINE V EDJERODE (2002) FWLR {Pt. 92} 1775. Learned counsel drew the attention of this Court to paragraphs 4, 5 and 6 of their Statement of Claim together with annextures ‘A’ and ‘B’, which clearly show that the cause of action in this suit originated from a Banker and Customer relationship i.e. between the Appellant and the 1st Respondent. That the 2nd Respondent in his capacity as the Managing Director of the 1st Respondent as well as the surety in respect of the credit facility the Appellant granted the 1st Respondent in the course of the said relationship provided the title document of his personal landed property and also executed a Deed of Legal Mortgage which was registered as No. 38 at page 38 in Volume 234 at the Lands Registry Port Harcourt mortgaging his property to the Appellant as security for the said credit facility. That the law is trite that where a dispute is between a bank and its customer, both the Federal High Court and the State High Court have concurrent jurisdiction to entertain an action arising from a transaction between the parties. Cited: –
1. AFRIBANK NIG. PLC V KOKATEX COMMERCE ? GENERAL LIMITED (2001) FWLR {Pt. 67} 1042.
2. N.D.I.C. V OKEM ENT. LTD (2004) All FWLR {Pt. 210} 1776.
3. U.B.A. PLC V B.T.L. INDUSTRIES LTD (2007) All FWLR {Pt. 352} 161. That the Supreme Court in its full session considered the effect of the proviso to Section 251 (1) (d) (Supra) inNDIC V OKEM ENT. LTD. (Supra) at page 1235 paragraphs D – F.
Learned counsel quoted the findings by the learned trial Judge on pages 108 – 109 of the records (which I will refer to anon) and submitted that the clear finding by the lower Court that Respondents’ claim is rooted in the loan mortgage transaction with the Appellant is unassailable. That this irresistible conclusion is supported by the judgment of the apex Court in NDIC V OKEM ENT. LTD. (Supra) where UWAIFO JSC held thus:
It can be seen that Section 251 (1) (d) was meant to give the Federal High Court exclusive jurisdiction in banking in the wide sense given in the Black?s Law Dictionary (Supra). That conclusion cannot be resisted in view of the open ended of that provision. But having contemplated, conferring exclusive jurisdiction on the Federal High Court in all the items stipulated in paragraph (d), which by the language used was indeed conferred, the law-giver then introduced a proviso
That in S.B.N. LTD V DE LLUCH (2004) 18 NWLR {Pt. 905} 341 the Supreme Court while construing the words ‘connected with or pertaining to banking’ in Section 251 (1) (d) of the Constitution at page 355 paragraph C held thus: –
‘Section 251(1) (d) in its tenor and intendment embraces all possible conceivable matters touching on banking whether on issue of tort or contract but not being a point on bank and customer relationship’.
Learned counsel quoted KALGO JSC while defining the term on page 360 paragraphs F – G.
In response to the submission by learned counsel to the Appellant that the appropriate forum for hearing the Respondents’ claim is the State High Court learned counsel submitted that the law is settled that a Court cannot adjudicate over an incidental or anciliary claims of a party where it has no jurisdiction to entertain the main claim. Cited the Supreme Court holding in TUKUR V GOVERNMENT OF GONGOLA STATE (1989) 4 NWLR {Pt. 117} 517 at 549 paragraph A. Learned counsel distinguished the authorities cited and relied upon by learned counsel to the appellant and urged the Court to discountenance the authorities as they do not and cannot apply in the circumstances of the instant suit.
He also urged the Court to hold that the learned trial Judge made proper findings which cannot be faulted and to resolve this issue in favour of the Respondents.
FINDINGS ON ISSUE 1:
I have considered the submissions by learned counsel on this issue and the authorities cited, quoted and relied upon in support of their submission. The Kernel of the Appellant’s submission is that the loan transaction between the appellant and the 1st Respondent (the 2nd Respondent not being a customer of the Appellant) was repaid in full. As pleaded in paragraph 14 of the Respondents’ statement of claim that: –
14: The Defendant acknowledged the receipt of the said sum as full and final settlement of the outstanding accounts and by a Deed of Release of Legal Mortgage dated the 18th day of January, 2007 formally discharged the property subject matter of the mortgage. The said Deed of Release is annexed hereto and marked Annexure ‘J’. (page 8 of the Records).
Therefore since the loan transaction is no longer in dispute between the parties because the loan was paid in full then the matter is no longer banker and customer relationship. It is now purely a case of detinue and no longer a mortgage transaction as decided by the learned trial Judge.
That the Federal High Court at the stage of the transaction has ceased to have jurisdiction over the transaction pursuant to Section 251 (1) (d) of the 1999 Constitution. It is only the State High Court that has jurisdiction to hear and determine the issue on detinue or wrongful detention of the title Documents of the 2nd Respondent who was not a customer of the Appellant in the first place, learned counsel cited several authorities to support this contention like 7up BOTTLING COMPANY LIMITED & ORS V ABIOLA & SONS BOTTLING COMPANY LIMITED (Supra) and TRADE BANK PLC V BENILUX (NIG) LTD (Supra)
On their part learned counsel to the Respondents is contending that the matter is not as simple as portrayed by the appellants. That issuing a Deed of Release was not done out of the blues, it has a root or source. In other words, there is a reason why Exhibit ?J? was issued to the Respondents. Thus the Deed of Release is incidental or ancillary to the main or principal claim which is the Deed of Mortgage entered into between the Appellant and the 1st Respondent. Moreover the 2nd Respondent is the Managing Director of the 1st Respondent. He operates the Account of the latter. He mortgaged his landed property to secure the loan granted to the 1st Respondent. In short the 2nd Respondent is the alter ego of the 1st Respondent. Therefore the attempt by learned counsel to the Appellant to separate or put a wedge between the 1st and 2nd Respondents as two distinct personalities in this transaction cannot be and is not possible. This submission is sound as it is the position of the law and I so hold.
Since the Deed of Release and what it represent is an ancillary or incidental claim a Court cannot adjudicate on it solely without the principal claim. The law is trite that an ancillary claim can only be determined by the Court that has jurisdiction to decide the main claim. See AWONUSI OMOLARA MARY V AWONUSI GBOLADE (2015) LPELR 25794 (CA) per DANJUMA JCA; BASIL EGBUONU V BORNU RADIO TELEVISION CORPORATION (1997) LPELR 1040 (SC) per IGUH JSC on page 22.
In UNIVERSITY OF ILORIN TEACHING HOSPITAL V DR. DELE ABEGUNDE (2013) LPELR 21375 (CA) this Court while defining ancillary claim held thus:
”It is trite that where a party’s principal claim fails, the accessory claims that are appendages to it will fail too. This cardinal principle of law was clearly espoused by the Supreme Court in the cases of Fagunwa V Adibi (Supra) and Akinduro V Alaya (2007) 15 NWLR {Pt. 1057} 312. The principle traces its paternity to the Latin Maxim: Accessorium sequitur principale – an accessory thing goes with the principal to which it is incidental to, see Tukur V Government of Gongola State (1989) 4 NWLR {Pt. 117} 517 at 564 – 565”. Per OGBUINYA JCA.
Therefore the Deed of Release being ancillary or accessory to the main claim of Legal Mortgage dated 26th September, 1997 Registered as No. 38 at Page 38 in Volume 234 at the Lands Registry in Port Harcourt cannot stand on its own it swim or sink with the principal claim, it cannot therefore be severed from the main claim. The learned trial Judge was right when in his Ruling he said the attempt by Defendant to sever the ancillary claim from the principal claim is like severing the umbilical cord of a baby from its mother prematurely. That baby will not survive. The submission by learned counsel to the Appellant that it is only the State High Court that has the jurisdiction to hear and determine the Respondents’ claim of detinue is not the position of the law and I so hold.
In ALHAJI UMARU ABBA TUKUR OFR V GOVERNMENT OF GONGOLA STATE (1989) 4 NWLR {Pt. 117} 517 at 549 paragraph A the Apex Court per OPUTA JSC held thus: –
”If there is a Court with jurisdiction to determine all the issues raised in a matter including the principal issue, it is improper to approach a Court that is competent to determine only some of the issues. The incompetence of the Court to entertain and determine the principal question is enough to nullify the whole proceedings and judgment in any matter brought before the Court”.
Since the Federal High Court is competent to determine all the issues raised in the instant suit pursuant to Section 251 (1) (d) of the 1999 Constitution. It is therefore not proper to approach the State High Court that is competent to determine only the ancillary issue. It is my holding therefore that having regard to the claim and circumstances of this suit, the Federal High Court has the jurisdiction to hear and determine the said suit. The submission by learned counsel to the Appellant and the authorities cited and relied upon while arguing this issue are hereby discountenanced by me. This issue is resolved in favour of the Respondents.
My finding on issue 1 automatically resolved issues 2 and 3 also in favour of the Respondents. This is an interlocutory appeal, the substantive suit before the lower Court is yet to be heard and determined on the merit since. Since I already found in favour of the Respondents that the Federal High Court has the requisite jurisdiction to hear and determine this suit, it follows therefore that issue 2 on the issue of ‘mitigation of loss’ raised by the Appellant can be raised and determined by the lower Court during trial of the suit, and I so hold. In answer to issue 3 my finding on issue one point to only one direction that the Notice of Preliminary Objection dated 14th May, 2008 was rightly dismissed by the learned trial Judge in his Ruling delivered on 18th March, 2009.
Having resolved the issues formulated by the Appellant in favour of the Respondents, it is the judgment of this Court that this appeal lacks merit. It is hereby dismissed. The Ruling delivered by the learned trial Judge on 18/03/2009 is affirmed by me. The Respondents are entitled to cost which I assessed at N50, 000 each against the Appellant.
ISAIAH OLUFEMI AKEJU, J.C.A.: I have read the Judgment of my learned brother, BITRUS GYARAZAMA SANGA JCA and I agree with the reasoning and conclusion therein. I dismiss the appeal and abide by the consequential order.
CORDELIA IFEOMA JOMBO-OFO, J.C.A.: I had the opportunity to read in draft the judgment just delivered by my learned brother Bitrus Gyarazama Sanga, JCA.
I agree with the sound reasoning and conclusion of my respected learned brother. This appeal obviously is dismissed for lacking merit. I hereby affirm the ruling delivered by the learned trial Judge on 18/03/2009 in suit No. FHC/CS/1289/2007.
I abide by the consequential orders regarding costs as made in the lead judgment.
Appearances:
Daisy Kwelle (Mrs.)For Appellant(s)
M.S. Agwu, Esq. with him, D. Udenno, Esq. For Respondent(s)
