DAGAZU CARPETS LIMITED V. BOKIR INTERNATIONAL COMPANY LIMITED & ANOR

Legalpedia Citation: (2025-01) Legalpedia 82240 (SC)

In the Supreme Court of Nigeria

Fri Jan 31, 2025

Suit Number: SC.415/2011

CORAM

Uwani Musa Abba Aji Justice of the Supreme Court of Nigeria

Chioma Egondu Nwosu-Iheme Justice of the Supreme Court of Nigeria

Obande Festus Ogbuinya Justice of the Supreme Court of Nigeria

Habeeb Adewale olumuyiwa abiruJustice of the Supreme Court of Nigeria

Mohammed Baba Idris Justice of the Supreme Court of Nigeria

PARTIES

DAGAZU CARPETS LIMITED

APPELLANTS

BOKIR INTERNATIONAL COMPANY LIMITED
MR DIPO ONIFADE

RESPONDENTS

AREA(S) OF LAW

CONSTITUTIONAL LAW, ADMINISTRATIVE LAW, COMPANY LAW, CONTRACT LAW, AGENCY LAW, RECEIVERSHIP, PRACTICE AND PROCEDURE, LAND LAW, LEGAL PRACTITIONERS, PROPERTY LAW, COMMERCIAL LAW, APPEAL

SUMMARY OF FACTS

This case involves a dispute over movable property and land sold by Dagazu Carpets Limited (the Appellant), a company in receivership, through its receiver and manager, Mr. Dipo Onifade (the 2nd Respondent), to Bokir International Company Limited (the 1st Respondent). The 1st Respondent claimed that despite full payment of N45,000,000 (Forty-Five Million Naira) to the Appellant, neither the movable properties listed in the schedule to the sale agreement nor the land covered by Certificate of Occupancy No. NC 7514 (consisting of 53.92 acres situate at Kaduna) had been handed over to the 1st Respondent.

The 1st Respondent filed an Originating Summons seeking declarations that all the movable property set out in the schedule to the sale agreement and the land covered by Certificate of Occupancy No. NC 7514 were vested in the 1st Respondent. The 1st Respondent also sought a declaration that the defendants could no longer exercise any acts or power of ownership over the properties and an order of possession of the said movable properties, land, and improvements thereon.

At the trial Court, neither the Appellant nor the 2nd Respondent filed a counter-affidavit in opposition to the 1st Respondent’s originating summons, and judgment was entered in favor of the 1st Respondent. Alhaji Tijani Dagazau (not a party at the trial Court) and Dagazau Carpets Limited appealed to the Court of Appeal, which dismissed the appeal. Dagazau Carpets Limited then appealed to the Supreme Court.

During the appeal at the Court of Appeal, Alhaji Tijani Dagazau, who was granted leave to appeal as an interested party, died. However, his counsel failed to inform the Court of his death, and the Court of Appeal proceeded to hear and determine the appeal.

HELD

The appeal was dismissed as lacking in merit.

The Court found that the appeal was incompetent and not maintainable due to issues with the proper parties to the appeal.

The Court held that the originating summons procedure was appropriate as the case was not contentious and involved primarily documentary evidence.

The Court affirmed that the Kaduna State High Court had jurisdiction over the case as it was a matter of simple contract, not requiring the jurisdiction of the Federal High Court.

The Court found that there is no statutory requirement for a receiver not appointed by the Court to seek leave of the Court to sue or defend.

Costs of N10 million was awarded against the Appellant in favor of the Respondents

ISSUES

Whether the judgment and orders of the Court of Appeal in this matter is not a nullity as the Court heard the appeal and delivered judgment with the knowledge that Alhaji Tijani Dagazau, the 1st Appellant, was dead?

Having regard to the reliefs sought in the Originating Summons, which is for declaration of title to land, possession thereof and of moveables thereon, whether the Originating Summons procedure was lawful in the circumstances?

Whether the decision of the Court below was correct to the effect that the absence of viva voce evidence did not vitiate the proceedings relating to declaratory reliefs over the property before the High Court and by extension the entire proceedings?

Whether the Court of Appeal was correct in law when it held that the cause of action was one, though rooted in the acts of a receiver over the assets of a company in receivership, was correctly adjudicated upon by the Kaduna State High Court instead of the Federal High Court?

Whether the Court of Appeal was in error when it failed to hold as argued before it that the 2nd Respondent ought to have obtained the leave of the Federal High Court to defend action in his capacity as a receiver?

RATIONES DECIDENDI

RECEIVER APPOINTMENT – PURPOSE AND EFFECT OF APPOINTING A RECEIVER

The purpose of appointing a receiver for a company is to work towards paying the outstanding debt redeeming security or freeing property from some jeopardy for the benefit of creditors or debenture holders on whose behalf the appointment is made. – Per MOHAMMED BABA IDRIS, J.S.C.

RECEIVER AS AGENT – LEGAL STATUS OF RECEIVER APPOINTED OUT OF COURT

A receiver can be appointed by the Court or out of Court. See Sections 209 and 389 of the Companies and Allied Matters Act 1990 (the substantive legislation at the time of filing the suit at the trial Court). The receiver in this case i.e. the 2nd Respondent was appointed out of Court and thus deemed to be an agent of that person on whose behalf he is appointed i.e., the Appellant in this case. The effect of such an appointment is that he acts as an agent of the Company. – Per MOHAMMED BABA IDRIS, J.S.C.

RIGHT OF APPEAL – SURVIVAL OF RIGHT TO APPEAL UPON DEATH OF APPELLANT

The right to appeal may survive a deceased party to a cause or matter but such right must be exercised by a living person or persons, which is not the case with the appeal at the lower Court. See the case of NIGERIAN NURSES ASSOCIATION & ORS VS. A. G., FEDERATION 1981 LPELR – 2027 (SC). When the 1st Appellant died, the right he had when he brought the appeal at the lower Court died with him and when it came to the knowledge of the lower Court that the 1st Appellant had died, the Court should have made the necessary pronouncement in that regard.– Per MOHAMMED BABA IDRIS, J.S.C.

DUTY OF LEGAL PRACTITIONERS – OBLIGATION TO INFORM COURT OF CLIENT’S DEATH

This Court must express its displeasure with the attitude of the 1st Appellants counsel at the Court below for not exercising its duty as a minister in the temple of justice i.e. failing to inform the Court below of the death of his client (the 1st Appellant), and standing by while the appeal was determined and then now coming here to condemn an act which he failed to criticize when he had the opportunity to do so. – Per MOHAMMED BABA IDRIS, J.S.C

ORIGINATING SUMMONS – APPROPRIATE CIRCUMSTANCES FOR USE OF ORIGINATING SUMMONS

The originating summons procedure is used whenever the law so provides and when the issue(s) in question are or are likely to be issues of construction of a written law or any instrument or of any deed, will, contract or other document or other question of law or in a circumstance where there is not likely to be a material dispute as to the facts. Where it is likely that the facts in a suit will be contentious and materially contradictory, it will be inappropriate to commence the suit by way of originating summons. Such a suit is to be commenced by way of Writ of Summons.” – Per MOHAMMED BABA IDRIS, J.S.C.

CONTENTIOUS FACTS – DETERMINING WHETHER A SUIT IS CONTENTIOUS

Perhaps, I should state that the law is known that it is not the mere filing of the counter-affidavit to oppose the claim/s made in originating summons, that makes the suit contentious or results in substantial dispute of the facts deposed therein. Rather, the nature of the claim/s and the facts deposed in the affidavit in support of the reliefs sought as well as the counter-affidavit, can by themselves, disclose disputed facts upon which the reliefs sought are predicated and the hostile nature of the proceedings. – Per MOHAMMED BABA IDRIS, J.S.C.

ORIGINATING SUMMONS – NATURE AND PURPOSE OF ORIGINATING SUMMONS PROCEDURE

Conclusively on this issue, it is important to state that the originating summons procedure involves a situation where the evidence in the main, is by way of documents and there is no serious dispute as to their existence in the dealings of the parties to the suit. In such a situation, there is no serious dispute as to facts but what the plaintiff is claiming is the ‘declaration of his rights’. – Per MOHAMMED BABA IDRIS, J.S.C.

JURISDICTION – FEDERAL HIGH COURT JURISDICTION ON CONTRACT MATTERS

It is a matter of simple contract. Simply put, Section 251 of the 1999 Constitution as amended, which prescribes the jurisdiction of the Court does not cover simple contract and or negligence emanating from such a contract that forms the subject matter of the instant matter.– Per MOHAMMED BABA IDRIS, J.S.C.

RECEIVER’S POWER TO SUE OR DEFEND – NO REQUIREMENT FOR LEAVE OF COURT

Further, there is nowhere in the Company and Allied Matters Act where a receiver not appointed by the Court such as the 2nd Respondent in the instant case, should apply for and get the leave of the Court to sue or defend. – Per MOHAMMED BABA IDRIS, J.S.C.

CONCURRENT FINDINGS – ATTITUDE OF SUPREME COURT TO CONCURRENT FINDINGS

I have nothing more to add than to agree with him. Since this appeal is consequent to concurrent findings of facts, it is not the attitude of this Court to interfere. This Court has reiterated in a plethora of decided cases that it does not make it a habit of disturbing the concurrent findings of lower Courts except in exceptional circumstances, such as where the Court is satisfied that the concurrent findings are perverse and resulted in miscarriage of justice such as where it is shown that the findings have not emanated from the evidence on record or are consequent upon wrong application of the law to facts. – Per UWANI MUSA ABBA AJI, J.S.C.

DOCUMENTARY EVIDENCE – RELIABILITY AND SUFFICIENCY OF DOCUMENTARY EVIDENCE

A party can prove a case by dint of parol evidence or documentary evidence. It is not mandatory that a party must adduce viva voce evidence to prove an action. Tendering relevant documentary evidence is sufficient to prove a case. In deserving circumstances, documentary evidence is more reliable than oral evidence. The reason is not farfetched. Documentary evidence is permanent, incorruptible and indelible unlike oral testimony which oozes out of vocal cord of a witness and susceptible to denial and distortions by its author.– Per OBANDE FESTUS OGBUINYA, J.S.C.

DUTY OF LEGAL PRACTITIONERS – ETHICAL OBLIGATIONS OF LAWYERS

I will refrain from commenting on the conduct of Counsel to the Appellant, but suffice to say that lawyers as operators of the administration of justice system owe a duty, to the society that nurtured them and made them what they are, to ensure that they conduct their activities in a manner that edifies and brings honor, respect and belief to the justice system. They should not allow themselves to be used by litigants to bring the justice system into disrepute. – Per HABEEB ADEWALE OLUMUYIWA ABIRU, J.S.C.

ABUSE OF COURT PROCESS – NATURE AND CONSEQUENCES OF ABUSE OF COURT PROCESS

The employment of judicial process is regarded as an abuse when a party improperly uses the judicial process to the irritation and annoyance of his opponent. The common denominator with the concept of abuse of Court process is the improper use of the judicial process in litigation to interfere with the due administration of justice. – Per HABEEB ADEWALE OLUMUYIWA ABIRU, J.S.C.