CORAM

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Uwani Musa Abba Aji – Justice of the Supreme Court of Nigeria

Ibrahim Mohammed Musa Saulawa – Justice of the Supreme Court of Nigeria

Emmanuel Akomaye Agim – Justice of the Supreme Court of Nigeria

Moore Aseimo Abraham Adumein – Justice of the Supreme Court of Nigeria

Mohammed Baba Idris – Justice of the Supreme Court of Nigeria

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PARTIES

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ASSOCIATION OF SENIOR CIVIL SERVANTS OF NIGERIA (TARABA STATE CHAPTER)

APPELLANTS 

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ASSET MANAGEMENT CORPORATION OF NIGERIA (AMCON)

RESPONDENTS 

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AREA(S) OF LAW

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FUNDAMENTAL RIGHTS ENFORCEMENT, CONSTITUTIONAL LAW, DEBT RECOVERY, AFFIDAVIT EVIDENCE, APPEAL, PRACTICE AND PROCEDURE, ASSET MANAGEMENT CORPORATION OF NIGERIA, CIVIL PROCEDURE, FAIR HEARING

 

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SUMMARY OF FACTS

The Appellant, Association of Senior Civil Servants of Nigeria (Taraba State Chapter), filed an originating motion before the Federal High Court, Taraba Division under the Fundamental Rights (Enforcement Procedure) Rules, 2009. The impetus for the application was a letter dated 28 April 2016 from the Respondent (AMCON), claiming that the Appellant owed the sum of ₦235,021,642.59 and threatening that, in the event of non-payment within 14 days, the names of the Appellant and its top officers would be published in newspapers, and other recovery measures including media publicity, recall of personal guarantee, asset takeover, liquidation and foreclosure would be deployed.

The Appellant, through a 33-paragraph affidavit deposed to by one Tukur Abubakar Taji, responded to the Respondent’s claim by asserting that it was not indebted to AMCON. The Appellant’s case was that a tripartite arrangement had existed between the Appellant, one Alhaji Umar M. Usman (now deceased) of H & R Ventures, and the defunct Intercontinental Bank (now Access Bank), in respect of the supply and delivery of motorcycles. Under the arrangement, Alhaji Umar M. Usman took delivery of some of the motorcycles and undertook in writing to personally pay the sum of ₦61,450,000. The Appellant averred that the transaction had been switched to a direct transaction between Alhaji Umar M. Usman and the bank, without the Appellant remaining a party, and that consequently it was not in a position to account for whether the entire debt had been remitted.

Notwithstanding the Appellant’s response, the Respondent sent a further letter reiterating its threat to take full recovery measures against the Appellant without further recourse to it. The Appellant filed the originating motion seeking seven reliefs, including: declarations that the threatened media publication and liquidation would breach its rights to dignity, liberty, association and property; and orders restraining the Respondent from taking any action against the Appellant without first determining whether the Appellant was actually indebted.

The Respondent neither filed a counter-affidavit nor entered appearance before the trial court. On 15 December 2016, the trial court delivered judgment and granted all seven reliefs as prayed, on the basis that the reliefs were uncontested.

The Respondent appealed to the Court of Appeal, Yola Division. After hearing the appeal, the Court of Appeal set aside the trial court’s judgment, holding that there was nothing in the affidavit in support that took the matter out of a purely commercial or business transaction, that fundamental rights matters are serious and allegations must be proved, and that the Appellant failed to show that the matter qualified as a fundamental rights enforcement action.

The Appellant further appealed to the Supreme Court on four grounds. The Supreme Court dismissed the appeal, affirming the Court of Appeal’s decision.

 

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HELD

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1. The suit did not qualify as a fundamental rights enforcement action. The main grievance of the Appellant was rooted in a commercial debt recovery dispute — specifically, whether the Appellant was indebted to the Respondent arising from a tripartite loan arrangement — and the alleged threat to fundamental rights was merely ancillary or incidental to that substantive commercial dispute. The enforcement of fundamental rights per se could not resolve the substantive claim. Issue 1 was resolved against the Appellant.

2. The Respondent (AMCON) is an agency of the Federal Government established for the specific purpose of aggressively pursuing bad debts and recovering non-performing loans in order to stabilize Nigeria’s financial system. To allow every alleged debtor to file a fundamental rights enforcement action whenever AMCON exercises its statutory debt recovery powers would render AMCON incapacitated and impotent. A formal demand for repayment of debt does not by itself constitute a breach of the debtor’s fundamental rights.

3. Having resolved Issue 1 against the Appellant, Issue 2 (service of originating process) became academic. However, the Court noted obiter that service was proper and the Respondent had not raised the issue of non-service.

4. The trial court further erred in granting all reliefs merely because they were uncontested; it was obliged to examine the evidence before it to determine whether it was sufficient to establish the claims. The demand letters sent by AMCON were normal banker-customer communications and did not constitute an infringement of fundamental rights.

5. The appeal was dismissed in its entirety. The judgment of the Court of Appeal delivered on 6 November 2019 was affirmed.

 

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ISSUES

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As distilled by the Appellant (adopted by the Supreme Court):

1. Whether taking into cognizance the facts and circumstances of the matter, the lower Court was not wrong when it held that the Appellant’s case was not justiciable under the Fundamental Rights (Enforcement Procedure) Rules? (Distilled from Grounds 1, 2 and 4)

2. Whether the lower Court was right to have made proof of service of the originating process an issue when the Respondent did not deny service and same was not in issue? (Distilled from Ground 3)

 

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RATIONES DECIDENDI

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FUNDAMENTAL RIGHTS ENFORCEMENT — THE CORRECT APPROACH IS TO EXAMINE THE RELIEFS SOUGHT, THE GROUNDS FOR SUCH RELIEFS, AND THE FACTS RELIED UPON; WHERE THE ALLEGED BREACH IS ANCILLARY OR INCIDENTAL TO THE MAIN GRIEVANCE, THE ACTION IS INCOMPETENT UNDER THE ENFORCEMENT RULES

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“The correct approach in a claim for the enforcement of fundamental rights is to examine the reliefs sought, the grounds for such reliefs, and the facts relied upon. Where the facts relied upon, disclose a breach of the fundamental right of the applicant as the basis of the claim, there is a redress through the enforcement of such rights, through the Fundamental Rights (Enforcement Procedures) Rules. However, where the alleged breach of right is ancillary or incidental to the main grievance or complaint, it is incompetent to proceed under the Rules. This is because the right, if any, violated, is not synonymous with the substantive claim, which is the subject matter of the action. Enforcement of the right per se cannot resolve the substantive claim, which is in any case different.” — Per Supreme Court in Opara v. SPDCN (2015) 14 NWLR (Pt. 1479) 307 at 319 (adopted by Mohammed Baba Idris, JSC)

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — A CONDITION PRECEDENT TO THE EXERCISE OF THE COURT’S JURISDICTION IS THAT THE ENFORCEMENT OF FUNDAMENTAL RIGHT SHOULD BE THE MAIN OR PRINCIPAL CLAIM AND NOT AN ACCESSORY CLAIM

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“When an application is brought under the Fundamental Rights (Enforcement Procedure) Rules, a condition precedent to the exercise of the Court’s jurisdiction is that the enforcement of fundamental right or securing of the enforcement thereof should be the main or principal claim and not an accessory claim.” — Per Nweze, JSC in Nwanze v. NRC (2022) LPELR-59631 (SC) Pages 19-20, Paras. F (adopted by Uwani Musa Abba Aji, JSC)

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — A SUIT THAT DOES NOT QUALIFY AS A FUNDAMENTAL RIGHTS MATTER BECAUSE IT IS ROOTED IN COMMERCIAL DEBT RECOVERY CANNOT METAMORPHOSE INTO A BREACH OF FUNDAMENTAL RIGHTS

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“I have myself looked intently into the instant appeal and is revealing and prima facie, that the whole issue bordered on a strained business transaction that necessitated and called for recovery of the said debt. Thus, cannot metamorphose into a breach of fundamental rights!” — Per Uwani Musa Abba Aji, JSC

 

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AMCON — IS AN AGENCY OF THE FEDERAL GOVERNMENT ESTABLISHED FOR AGGRESSIVE PURSUIT OF BAD DEBTS; ALLOWING ALLEGED DEBTORS TO ROUTINELY FILE FUNDAMENTAL RIGHTS ACTIONS AGAINST IT WOULD RENDER IT INCAPACITATED AND IMPOTENT

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“The Respondent is an agency of the Federal Government whose primary duty is to stabilize Nigeria’s financial system by buying bad loans (non-performing loans) from banks, recapitalizing the banks, recovering value from the assets through legal means in order to build the economy. One of its main duties is asset acquisition, asset management, debt recovery using powers under the AMCON Act to compel repayment and ensure financial stability. The Respondent is protected by law and it would be highly detrimental to the exercise of its powers to allow every ‘accused’ debtor to file an action under the Fundamental Rights (Enforcement Procedure) Rules when they are called upon to repay their debts.” — Per Mohammed Baba Idris, JSC

 

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AMCON — IS AN UNUSUAL VEHICLE USED TO RECOVER FUNDS AND THRIVES ON THE PECULIAR PROVISIONS OF ITS ENABLING ACT; IT OPERATES A FAST TRACK DEBT RECOVERY PROCEDURE THAT BROOKS NO DELAY

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“The Act, which is a statute enacted by the National Assembly, establishes the Respondent, AMCON purposefully for the aggressive pursuit of bad debts from companies and individuals who has made a caricature of the country’s financial system and have devised strategies to evade paying back these loans or surrendering the assets for which the loans were secured in the first place. The Corporation is an unusual vehicle used to recover funds and thrives on the peculiar provisions of the enabling Act, which sets out procedures for such recovery through judicial cover. It is also a fast track procedure which brooks no delay.” — Per Obaseki-Adejumo, JCA in Fiogret Ltd & Anor v. AMCON (2018) LPELR-49828 (CA) Pages 33-35, Paras. F-F (adopted by Mohammed Baba Idris, JSC)

 

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AFFIDAVIT EVIDENCE — WHERE THERE IS A CONFLICT IN AFFIDAVIT EVIDENCE, ORAL EVIDENCE OR AUTHENTIC DOCUMENTARY EVIDENCE MAY BE USED TO RESOLVE THE CONFLICT; DOCUMENTARY EVIDENCE IS CAPABLE OF TILTING THE BALANCE IN FAVOUR OF THE AFFIDAVIT WITH WHICH IT AGREES

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“Evidence by affidavit is, it must be noted, is a form of evidence. It is entitled to be given weight where there is no conflict, after the conflict has been resolved from appropriate oral or documentary evidence. For true, it is the law that where there is a conflict of affidavit evidence called by both sides, it is necessary to call oral evidence to resolve the conflict. But I believe that it is not only by calling oral evidence that such a conflict should be resolved. There may be authentic documentary evidence which supports one of the affidavits in conflict with another. In a trial by affidavit evidence such as this, that document is capable of tilting the balance in favour of the affidavit which agrees with it.” — Per Nnaemeka-Agu, JSC in Nwosu v. Imo State Environmental Sanitation Authority & Ors (1990) LPELR-2129 (SC) Pages 32-33, Paras. E-B (adopted by Mohammed Baba Idris, JSC)

 

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DEBT RECOVERY — A FORMAL DEMAND FOR REPAYMENT OF DEBT DOES NOT CONSTITUTE AN INFRINGEMENT OF THE ALLEGED DEBTOR’S FUNDAMENTAL RIGHTS; DEMAND LETTERS ARE NORMAL IN BANKER-CUSTOMER RELATIONSHIPS

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“The demand letters – exhibits ‘ASCN 1’ and ‘ASCN 7′ – were merely to demand payment of an alleged outstanding debt. Such demand letters or notices are normal in banker-customer relationships. They do not constitute an infringement of the appellants’ fundamental rights. No bank debtor has the fundamental right to neglect or refuse to pay his debt.” — Per Moore Aseimo Abraham Adumein, JSC

 

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DEBT RECOVERY — THE LAW IS SETTLED THAT A BANK DEBTOR HAS AN OBLIGATION TO REPAY ANY LOAN OBTAINED FROM HIS BANK; NO DEBTOR HAS THE FUNDAMENTAL RIGHT TO NEGLECT OR REFUSE REPAYMENT

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“The law is settled that, a bank debtor has an obligation repay any loan obtained from his bank. See Adalma Tankers Bunkering Services Ltd. & Anor. v. Central Bank of Nigeria & 3 Ors. (2022) 11 NWLR (Pt. 1842) 405 at 475.” — Per Moore Aseimo Abraham Adumein, JSC

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — A TRIAL COURT MUST EXAMINE THE EVIDENCE BEFORE IT TO DETERMINE WHETHER IT IS SUFFICIENT TO ESTABLISH THE CLAIM; IT CANNOT GRANT RELIEFS MERELY BECAUSE THEY ARE UNCONTESTED

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“The trial Court ought to have examined the evidence before it, with a view to showing whether or not the evidence was sufficient to establish the claim before it.” — Per Supreme Court in Martchem Industries Nig. Ltd. v. M. F. Kent West Africa Ltd. (2005) LPELR-1842 (SC); (2005) 10 NWLR (Pt. 934) 645 at 659 (adopted by Moore Aseimo Abraham Adumein, JSC)

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — A PARTY SEEKING ENFORCEMENT OF FUNDAMENTAL RIGHTS MUST COME WITH CLEAN HANDS; THE COURT CANNOT ALLOW ITS PROCESSES TO BE USED TO SHIELD AN ALLEGED DEBTOR FROM LEGITIMATE DEBT RECOVERY

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“He who comes to equity must come with clean hands. Before a party can seek for the enforcement of his rights, the party must have clean hands. It is not this Court’s business to determine whether indeed any money is being owed and who is right or who is wrong. However, if every individual or body or company runs to the Court, screaming ‘my rights are being threatened and about to be infringed upon’ when the Respondent is merely trying to do the job it was established to do, it will render the Respondent incapacitated and impotent.” — Per Mohammed Baba Idris, JSC

 

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MOOT AND ACADEMIC QUESTIONS — WHERE RESOLUTION OF A PRINCIPAL ISSUE IS DETERMINATIVE OF AN APPEAL, A SUBSIDIARY ISSUE THAT BECOMES ACADEMIC NEED NOT BE RESOLVED ON THE MERITS

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“Having resolved that the instant suit does not qualify as a fundamental rights case, issue two has become academic. However, for what it is worth, the service of the originating process on the Respondent was proper. The Respondent did not raise the issue of non-service and if issue one had succeeded, issue two also would have succeeded.” — Per Mohammed Baba Idris, JSC

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — WHERE THE MATTER IS PURELY A COMMERCIAL OR BUSINESS DISPUTE ROOTED IN DEBT RECOVERY, IT CANNOT BE CONVERTED INTO A FUNDAMENTAL RIGHTS MATTER MERELY BECAUSE THE DEBTOR DISPUTES HIS INDEBTEDNESS

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“I am of the firm opinion that this suit does not qualify as a fundamental rights enforcement case because if it is allowed to be regarded as one, it will cause more harm than good as it will gradually uproot the tooth of the Respondent one after the other until it becomes toothless and powerless. The Appellant should also aggressively prove that indeed they are not liable to pay the said sum outside the walls of the Courts or file a civil action against the Respondent to prove same.” — Per Mohammed Baba Idris, JSC

 

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FUNDAMENTAL RIGHTS ENFORCEMENT — A TRIPARTITE COMMERCIAL AGREEMENT CANNOT BE UNILATERALLY TERMINATED BY A HANDWRITTEN NOTE OF A NOW DECEASED PARTY; SUCH CONTENTIOUS ISSUES MUST BE RESOLVED THROUGH APPROPRIATE CIVIL PROCEEDINGS AND NOT BY WAY OF FUNDAMENTAL RIGHTS ENFORCEMENT

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“There is nothing solid before this Court to show that the participation of the Appellant was successfully terminated. A solid tripartite agreement was executed to create the contractual relationship but can it be said that a simple handwritten note by a now deceased party terminated it? I do not think so! Affidavits should contain facts. However, we are not sure if paragraphs 6 – 12 are facts that do not need to be ironed out with better evidence and a counter affidavit or if the entire matter should be instituted by way of another form of originating process.” — Per Mohammed Baba Idris, JSC

 

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CASES CITED

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STATUTES REFERRED TO

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• Constitution of the Federal Republic of Nigeria 1999 (as amended) — Sections 34, 35, 36(1), 40, 43, 46
• African Charter on Human and Peoples’ Rights (Ratification and Enforcement) Act (Cap A9)
• Laws of the Federation of Nigeria 2004 — Articles 5, 6, 7, 10(1)
• Fundamental Rights (Enforcement Procedure) Rules, 2009 — Order 2 Rule 1
• Asset Management Corporation of Nigeria (AMCON) Act

 

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OTHER CITATIONS

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CLICK HERE TO READ FULLJUDGMENT 

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COUNSEL

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1.   E. A. I. Effiong, Esq., with him, D. G. Tukura, Esq.For Appellant(s)

2.   A. A. Usman, Esq.For Respondent(s)