3PLR – CONTRACT RESOURCE NIGERIA LTD. & ANOR. V.  UNITED BANK FOR AFRICA PLC.

POLICY, PRACTICE AND PUBLISHING, 3PLR, LAW REPORTS

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CONTRACT RESOURCE NIGERIA LTD. & ANOR.

V. 

UNITED BANK FOR AFRICA PLC.

IN THE SUPREME COURT OF NIGERIA

ON FRIDAY, THE 8TH DAY OF JULY, 2011

SC.292/2003

LN-e-LR/2011/32 (CA)

 

OTHER CITATIONS

 

BEFORE THEIR LORDSHIPS

ALOMA MARIAM MUKHTAR, JSC

WALTER SAMUEL NKANU ONNOGHEN, JSC

FRANCIS FEDODE TABAI, JSC

IBRAHIM TANKO MUHAMMAD, JSC

BODE RHODES-VIVOUR, JSC

 

BETWEEN

1. CONTRACT RESOURCE NIGERIA LTD
2. MODE NIGERIA LTD. – Appellants

AND

UNITED BANK FOR AFRICA PLC. – Respondents

 

REPRESENTATION

J.O.N. Ikeyi; – For Appellant

AND

Dr. A.J.C. Mogbana;

B.E. Ukaegbu;

1. Mbadugha,

J, Udensi; – For Respondent

 

MAIN ISSUES

COMPANY LAW – LEGAL PERSONALITY:- Directors – Powers of a company via its Directors – Whether Order 6 Rule 5(1)(b) of the Supreme Court Rules allows a company through its director to prepare a brief on the company’s behalf – Whether  a company could only be represented by attorney and it was not in the same position as a litigant in person – Effect of Section 15(1) of the Supreme Court Act thereto

COMMERCIAL LAW – CONTRACT:- Failure to pay sum due under a contract – Where liability admitted but failure attributed to negligence of bankers – Third party claims taken out to shift liability to bank – How treated

DEBTOR AND CREDITOR – RECOVERY OF CONTRACT SUM:- Where failure to pay attributed to negligence of bankers – Third party claims to recover from bankers – How treated

BANKING AND FINANCE:- Banker-Customer relations – Negligence to pay sum of money owed by customer pursuant to an agreement – Liability arising therefrom – Third-party claims to shift liability to bankers – How treated

CONSTITUTIONAL AND PUBLIC LAW – RIGHT OF ACCESS TO COURT:- Distinction between natural person and corporate/corporate entity – Whether an artificial entity unlike a natural person has no right to argue an appeal personally – Whether it is mandatory for brief of an artificial entity to be prepared and argued on its behalf by a legal practitioner

CONSTITUTIONAL LAW:- Section 243(a) of the Constitution – Legal basis for appealing a judgment of a court in Nigeria – Where leave of court is necessary to bring an appeal– Effect of failure thereto

ETHICS – LEGAL PRACTITIONER:- Preparation of brief – Counsel arguing a brief prepared by a layman – Appellate briefs at the Supreme Court on behalf os an artificial entity – Duty of counsel to provide quality professional assistance that would ensure sound dispensation of justice to the court through the preparation of briefs

ETHICS – LEGAL PRACTITIONER:- Appellate brief signed by a layman on behalf of an artificial entity – Where argued by counsel – Competence – Attitude of court thereto

PRACTICE AND PROCEDURE – ACTION – PRELIMINARY OBJECTION:- Meaning, essence and purpose of – Effect where sustained – Whether can be based on both legal and factual contentions

PRACTICE AND PROCEDURE – ACTION – PRELIMINARY OBJECTION:- Where based on facts – Whether an affidavit is a prerequisite

PRACTICE AND PROCEDURE – APPEALS:- Filing of preliminary objection against an appeal under Order 2 Rule 9 of the Supreme Court Rules – Fundamental requirement – Effect where sustained

PRACTICE AND PROCEDURE – APPEALS:- Definition and purpose of an appeal – Constitutional basis – Section 243(a) of the Constitution –  Who can competently appeal against a judgment of the court

PRACTICE AND PROCEDURE – APPEALS:- Definition of an appellant – Distinction between a party to a suit and an interested party – Conditions an interested party must satisfy to bring an appeal against a judgment of a court

PRACTICE AND PROCEDURE – COURT:- Interpretation of statute – Construction of the word “May”– Duty of court to examine context of the case

INTERPRETATION OF STATUTE:- Rule that the word “shall” does not always mean “must” a matter of compulsion – Duty of court to examine context

INTERPRETATION OF STATUTES:- Order 2 Rule 9 of the Supreme Court Rules – Meaning of in relation to filing of preliminary objections

WORDS AND PHRASES:- “Appeal” – Appellant”- “May”- Meaning of

 

 

 

 

MAIN JUDGMENT

BODE RHODES-VIVOUR, J.S.C (DELIVERING THE LEADING JUDGMENT):

This is an appeal from the judgment of the Court of Appeal delivered on the 12th day of June, 2003, wherein that court allowed the appeal and ordered a rehearing of the third party claim before another judge of the Enugu State High Court other than the learned trial Chief Judge,

 

The 1st appellant as plaintiff in Suit No, E428/99, sued the 2nd appellant as defendant. Trial was in the Enugu High Court, Enugu State. Ugwu CJ (as he then was) presided. The plaintiff claimed the sum of N46m from the defendant. The sum was debt due to the plaintiff which became payable from a contract agreement dated the 15th of June, 1998. The plaintiff further claimed 25% compound interest on the sum from 20th day of December 1998 till judgment and post judgment interest of 10%. The defendant admitted liability but claimed that its default in paying its debt was due to the negligence of its bankers, UBA PLC.

 

On 20/3/2000, the plaintiff filed Motion for judgment against the defendant, and on 4/4/2000 the learned trial Chief Judge entered judgment for the plaintiff for the sum of N46m plus interest. Meanwhile the defendant had taken out third party claim against UBA PLC. The learned Chief Judge fixed hearing for the 9th of May 2000, but in unexplained circumstances the third party claim was heard on the 7th of April, 2000 in the absence of UBA PLC, and judgment entered against UBA PLC for N46m. UBA PLC quickly lodged an appeal. The Court of Appeal, Enugu Division allowed the appeal, and remitted the third party claim for hearing all over again before a judge of the Enugu State High Court other than the learned Chief Judge of Enugu State.

 

This appeal is against that judgment, but interestingly the 1st appellant who was not a party in the third party claim and not a party in the court below is the 1st appellant before this court. The respondent, UBA PLC filed a Preliminary objection on the 14th of July 2004 to the hearing of this appeal. Order 2 Rule 9 of the Supreme Court Rules provides for the filing of preliminary objections. The fundamental requirement is that the preliminary objection must be filed and served on the appellant three days before the hearing of the appeal thereby removing the element of surprise and giving the appellant enough time to respond. The purpose of a Preliminary objection is to contend that the appeal is defective or incompetent. If sustained the appeal would no longer be heard. A successful preliminary objection terminates the hearing of an appeal. See NEPA v. Ango 2001 15 NWLR pt. 737 pg.627; Ndigwe v. Nwude 1999 11 NWLR pt.626 pg. 314

 

Preliminary objections are usually on Law consequently no affidavit is necessary, but where the need to produce or rely on facts becomes necessary an affidavit ought to be filed. In this case the respondent filed a Notice of Preliminary objection supported by a 14 paragraph affidavit. In the circumstances an affidavit is necessary because there is reliance on facts, and facts have no views. They are sacred.

 

The grounds of the Preliminary objection are:

1. Contract Resource Nigeria Limited has no locus standi in this appeal since it was not a party in the lower court and has neither applied for nor obtained leave to appeal as an interested party;
2. The appeal is incompetent because the notice of appeal was signed by a person who is not a legal practitioner, the proper appellant (Mode Nigeria Ltd) being an artificial person; and
3. The appellants’ brief of argument is incompetent, not having been signed by a legal practitioner on behalf of the true appellant, an artificial person.

 

Relevant extracts from the affidavit in support read thus:

2. This appeal originated from suit No.E/428/99 instituted in the Enugu State High Court sitting at Enugu with Contract Resource Nigeria Limited, as plaintiff, Mode Nigeria Limited, as defendant, and United Bank for Africa PLC as third party.
3. On 4/4/2000 the court gave judgment in favour of the plaintiff and the third party claim between Mode Nigeria Ltd and UBA PLC was adjourned to 9/5/2000.
4. In its absence and without hearing notice having been issued and served on UBA PLC, the court entered judgment prematurely against UBA PLC on 12/4/2000 sequel to an ex parte motion filed by Mode Nigeria Ltd.
5. On 11/7/2000 UBA PLC filed a notice of appeal CA/E/158/2000 to have the judgment of 12/4/2000 set aside by the Court of Appeal as a nullity on grounds of serious violation of UBA’s right to fair hearing.
6. The applicants’ counsel, DR. A.J.C. Mogbana, has advised the third party and it believes that the said appeal was between the third party (UBA PLC) as appellant and the defendant (Mode Nig Ltd) as respondent.
7. The Court of Appeal, Enugu Division, on 12/6/2003 allowed the appeal, declared the judgment in the third party claim as a nullity and set it aside.
8. The defendant/respondent in the Court of Appeal appealed to this court against the judgment of the lower court in favour of the third party.
9. The said applicant’s counsel has informed the applicant and it believes that Contract Resource Nig Ltd was not a party in the lower court, and not having obtained leave to appeal as an interested party, has no right to appeal to the Supreme Court against the decision of the lower court.
10. The notice of appeal and appellants’ brief in this appeal has been signed by Ifeanyichukwu Okonkwo.
11. Ifeanyichukwu Okonkwo is not a legal practitioner empowered by Law to sign such processes.

 

At the hearing of the appeal on the 11th day of April, 2011 learned counsel for the respondent, DR A.J.C. Mogbana observed that the 1st appellant has no locus standi, as it was not a party in the court below, and it was not granted leave to appeal as an interested party. He further observed that the appellants’ brief was settled by someone who is not a legal practitioner. Concluding he submitted that the appellants brief and the Notice of Appeal are incompetent, and the appeal ought to be struck out. Urging the court to dismiss the Preliminary objection, learned counsel for the appellants argued that by the provisions of Order 6 Rule 5(b) of the Rules of this court, the brief and Notice of Appeal may be settled by counsel, contending that the provision supra accommodates a situation where the appellant can prepare both documents.

 

An appeal is a review of the decision of the court below by a higher court. The purpose being to see if the court below considered the facts properly and arrived at the correct decision. By the provisions of Section 243(a) of the Constitution it is a party in a suit or an interested party that can appeal against a judgment of the court. See In Re: Arowolo 1993 2 NWLR pt.275 pg.1; Ogunbiyi v. Mustapha 1996 4 NWLR pt. 442 pg. 337

Where a party who was not a party in the court below seeks to appeal to this court, he can only do so if he seeks and obtains leave from this court, and he would obtain leave if and only if he is able to satisfy this court that he is an interested party.
An appellant is a person appealing from a decision or applying for leave to appeal.

 

Section 243(a) of the Constitution makes leave a mandatory pre-condition that must be sought and obtained before an interested party can appeal. An applicant filing an appeal without satisfying or fulfilling that pre-condition is merely wasting his time. Contract Resources Nig Ltd was not a party in the third party claim, neither was it a party in the court below. It never applied for leave (permission) to appeal against the judgment of the Court of Appeal. In the absence of leave, Contract Resources Nig Ltd is a meddlesome interloper with no real stake in the appeal. In the circumstances the preliminary objection is upheld on ground one.

 

I now turn to the 2nd appellant, Mode Nigeria Limited. The Notice of Appeal, Appellants’ brief were signed on behalf of a corporate body by a person who is not a legal practitioner, a layman, one Ifeanyichukwu Okonkwo, who described himself as Company Director of No.14 Ishielu Avenue Independence Layout, Enugu, Enugu State.

 

The Issue is:

Whether a layman, a company Director is allowed to file court processes on behalf of a corporate body.

 

The Notice of Appeal and the appellants brief were signed by Ifeanyichukwu Okonkwo, a layman, Company Director. The appeal was argued by MR. J.O.N. Ikeyi, a legal practitioner. That is to say a legal practitioner argued an appeal in which the appellants’ brief was prepared by a layman.

 

Order 6 Rule 5(1)(b) of the Supreme Court Rules States that:

“The brief which may be settled by counsel shall contain what are, in the appellants’ view the issues arising in the appeal, If the appellant is abandoning any point taken in the court below, this shall be so stated in the brief. Equally, if the appellant intends to apply in the course of the hearing for leave to introduce a new point not taken in the court below, this shall be indicated in the brief. ”

 

It is now well settled by this court that the word “shall” does not always mean “must” a matter of compulsion. It could be interpreted, where the context so admits as “may” whereas “may” is also not always “may”. It may sometimes be equivalent to “shall”. See Ifezue v. Mbadugha 1984 1 SCNLR pg.427

 

“May” in Order 6 Rule 5(1)(b) accommodates a Litigant who is a natural person, a party, handling the appeal by himself. An artificial entity cannot argue an appeal personally. The right of audience for such an entity is limited to counsel instructed on the corporation’s behalf. “May” is equivalent to shall when an artificial entity is a party in an appeal. Its brief shall be prepared and the appeal argued on its behalf by a legal practitioner. Indeed in Halsbury’s Laws of England, paragraphs 754 and 756, the right of audience before the House or an appellate committee is restricted to counsel instructed on behalf of a party or, where the party is a single person, the party himself. In Tritonia Ltd & Ors v. Equity and Law Life Assurance Society 1943 2 All England Report pg. 401. The house of Lords (now Supreme Court of England) held inter alia that:

”when an appeal is argued before the House of Lords, no one has any right of audience except counsel instructed on behalf of a party or (when the litigant is a natural person) the party himself. In the case of a corporation, in as much as the artificial entity cannot attend and argue personally, the right of audience is necessarily limited to counsel instructed on the corporations behalf.”

 

Also in RE London CC and London Tramways Co. 1897 13 TLR Pg. 254. A litigant was allowed to appear in person, but a company must appear by counsel who could instruct counsel on their behalf. See also Scriven v. Jescott (Leeds) Nig. 1908 53 Sol. J. Pg. 101 where it was stated that a company could only be represented by attorney and it was not in the same position as a litigant in person. Section 15(1) of the Supreme Court Act supports all that I have been saying. It states that:

“Subject to the provisions of any other enactment, in all proceedings before the Supreme Court the parties may appear in person or be represented by a legal practitioner entitled by or under enactment or rules of court to practice in that court.”

 

In this appeal, the Notice of Appeal and the appellants’ brief were both signed by MR. I. Okonkwo, a Company Director and a layman. The signature of Mr. I. Okonkwo on both documents implies that the documents were prepared by him. I must remind Mr. J.O.N. Ikeyi who appeared for the appellants that court business is very serious business. It is unheard of for counsel to argue a brief prepared by a layman. If this is allowed, cranks, professional litigants and those with only a nodding acquaintance with the law will prepare briefs for argument before this court. Counsel appearing before this court and indeed any court properly constituted should be alive to their responsibilities to assist the courts. The highest Court in the land must be given quality professional assistance that would ensure sound dispensation of justice.

 

In Civil Appeals the Notice of Appeal and Briefs of argument shall be prepared and signed by counsel. The only exception is where the party is a natural person, and insists on handling his appeal himself. Right of audience is open to counsel and/or the party in the appeal. In the case of a Corporation, the Notice of Appeal and Brief of argument shall be prepared and signed by counsel and the right of audience before this court is restricted to counsel. This is so as a corporation being an unnatural person, needs someone learned in the Law to handle its appeal, and that person can only be a Legal Practitioner.

 

The Notice of Appeal and the appellants’ brief of argument are incompetent having been signed by a layman. The Preliminary Objection is again upheld and the appeal is hereby struck out with costs of N50,000.00 to the respondent.

 

 

A.M. MUKHTAR, J.S.C:

I have had the opportunity of reading in advance the lead judgment delivered by my learned brother Rhodes-Vivours JSC, and I agree with the reasoning contained therein.

 

The preliminary objection filed by the learned counsel for the respondent has as appellants/respondents, Ifeanyichukwu Okonkwo and Mode Nigeria Ltd. In the body of the process, the grounds of the objection are stated as follows:-

(a)     Ifeanyichukwu Okonkwo has no locus standi in this appeal since he was not a party in the lower court and has neither applied for nor obtained leave to appeal as an interested party;

(b)     The Appeal is incompetent because the notice of appeal was signed by a person who is not a legal practitioner, the proper appellant (Mode Nigeria Ltd.) being an artificial person;

(c)     The appellant’s brief of argument is incompetent, not having been signed by a legal practitioner on behalf, of the true appellant, an artificial person.”

 

The pertinent deposition of the affidavit in support of the preliminary objection reads as follows:-

“9.     The said applicant’s counsel has informed the applicant’s and it believes that Contract Resource was not a party in the lower court, and not having obtained leave to appeal as an interested party has no right to appeal to the Supreme Court against the decision of the lower court.”

 

Indeed Contract Resource Nigeria Ltd was not a party in the lower courts. The law requires that a party who was not a party in the lower courts and seeks to appeal against a decision of which he did not take part in the proceedings, to seek and obtain leave to be a party in an appellate court. In the instant case, Contract Resource Nigeria Ltd did not obtain such leave, and so he lacks locus to be an appellant in this court. In the circumstance that leave was not obtained the appeal becomes incompetent. See Akande v. General Electric Ltd. 1979 3 – 4 SC. 115, and Ikweki v. Ebele 2005 11 NWLR part 936 page 396.

 

For this and also the fuller treatment of the other grounds of objection in the lead judgment I also uphold the preliminary objection raised and strike out the appeal. I abide by the consequential order made in the lead judgment.

 

 

WALTER SAMUEL NKANU ONNOGHEN, J.S.C:

The facts of this case have been stated in the lead judgment of my learned brother RHODES-VIVOUR, JSC just delivered and I do not intend to repeat them here except as may be needed to emphasis the point being made.

 

This appeal is against the judgment of the lower court, holden at Eungu which allowed the appeal of the present respondent/third party against the judgment of the trial court in third party proceeding delivered on 12th April, 2000 in the absence of and without notice to the third party/respondent in this appeal.
The lower court, at page 271 of the record specifically held thus:

” For the foregoing reasons, I am of the firm view that the third party appellant in this appeal is entitled ex debito justitiae to have the judgment in suit No. E/428/99 delivered on 12th April, 2000 set aside for being a nullity.

Accordingly this appeal is hereby allowed. The judgment of the trial court delivered on 12th April, 2000 against the appellant is hereby set aside for being a nullity, The claim of the defendant/respondent against the third party/appellant in the Third Party Proceedings is hereby remitted to the trial court for hearing by another Judge of the Enugu State High Court other than the learned trial chief judge…”

 

The Third Party Proceedings resulting in the judgment in the appeal before the lower court as well as the said appeal was between Mode Nigeria Limited as defendant/respondent vs United Bank for Africa Plc as Third Party/appellant.
The judgment of the trial court in the said proceedings can be seen at page 38 of the record is in the following terms:-

“Court. Judgment is hereby entered in favour of the defendant/applicant against the third party as follows:-

1)      The third party to pay the sum of N46,600,000.00 (forty-six million, six hundred thousand naira) to the defendant/applicant being debt owed to the defendant/applicant.

2)      The third party to pay 25% interest from 29th December, 1998 to 4th April, 2000 when the judgment was delivered.

3)      The third party to pay 5% interest on the judgment to the defendant/applicant until the whole amount is fully liquidates….”

 

It was the above judgment that was set aside by the lower court and it is very clear from both judgments that CONTRACT RESOURCE NIGERIA LTD, the plaintiff in the suit was not a party in the Third Party Proceeding neither was it a party to the appeal arising therefrom. The decision of the lower courts did not adversely affect the rights or interest of the said company and cannot therefore be described as a party/person aggrieved by the said decisions so as to confer any right of appeal on the said company neither can it, legally be granted any leave to appeal as an interested party against the said decisions if it had applied for such leave. In the circumstance there is nothing to ground the notice of appeal on behalf of the said company. Contract Resource Nigeria Ltd is clearly a busy body in this appeal.

 

Secondly the notice of appeal and appellant’s brief of argument were signed on behalf of the 2nd appellant Mode Nigeria Ltd, an incorporated legal personality, by one Ifeanyi Chukwu Okonkwo who described himself as Company Director, a layman while the appeal was argued before us by J.O.N Ikeyi Esq, a legal practitioner. It is settled law that whereas a party/litigant who is a natural person can file and argue an appeal before the courts, an incorporated party/litigant, being an artificial entity cannot file, attend and argue an appeal before the courts in person/personally but can do so only through legal practitioner(s) on its instructions, See also section 15(1) of the Supreme Court Act which provides as follows:-

“Subject to the provisions of any other enactment, in all proceedings before the Supreme Court the parties may appear in person or be represented by a legal practitioner entitled by or under enactment or rules of court to practice in that court”.

 

In the instant appeal the person who signed the offensive vital documents on behalf of the 2nd appellant, a corporation is a layman.

 

It is for the above reasons and the more detailed ones contained in the lead judgment of my learned brother that I too find the Notice of Appeal and appellant’s brief of argument in the instant appeal grossly incompetent and consequently liable to be struck out.

 

l order accordingly and abide by the consequential orders made in the said lead judgment including the order as to costs.

 

Preliminary objection of the respondent is hereby sustained and the appeal struck out.

 

 

1. F. TABAI , J.S.C:

I read in advance, the lead judgments in these appeals prepared by my learned brother Rhodes-Vivour, JSC, and I agree with his reasoning and conclusions that the preliminary objection is meritorious. The Notices of Appeal and the Appellants’ briefs are incompetent for the reasons ably articulated in the lead judgment. The result is that the appeal is struck out for incompetence. I abide by the order on costs contained in the lead judgments.

 

 

I.T. MUHAMMAD, J.S.C:

I have had the opportunity of reading the judgment just delivered by my learned brother, Rhodes-Vivour, JSC. I agree with his reasoning and conclusion.
On the preliminary objection alone, which I sustain, this appeal must be, and is hereby struck out by me.

 

I abide by all consequential orders made therein including order on costs.