GLENYORK NIGERIA LIMITED & ANOR V PANALPINA WORLD TRANSPORT NIG. LIMITED

Legalpedia Citation: (2025-02) Legalpedia 00611 (SC)

In the Supreme Court of Nigeria

Holden at Abuja

Fri Feb 21, 2025

Suit Number: SC.34/2008

CORAM

Helen Moronkeji Ogunwumiju -Justice of the Supreme Court of Nigeria

Emmanuel Akomaye Agim -Justice of the Supreme Court of Nigeria

Haruna Simon Tsammani -Justice of the Supreme Court of Nigeria

Obande Festus Ogbuinya- Justice of the Supreme Court of Nigeria

Mohammed Baba Idris-Justice of the Supreme Court of Nigeria

PARTIES

1. GLENYORK NIGERIA LIMITED
2. ROYAL RE-INSURANCE CO. LTD (SUING BY AND THROUGH THEIR ATTORNEY)

APPELLANTS

PANALPINA WORLD TRANSPORT NIG. LIMITED

RESPONDENTS

AREA(S) OF LAW

CONSTITUTIONAL LAW, ADMIRALTY LAW, CONTRACT LAW, SHIPPING LAW, JURISDICTION, CARRIAGE OF GOODS, BAILMENT, MARITIME CLAIMS, TRANSPORTATION LAW, PRACTICE AND PROCEDURE

SUMMARY OF FACTS

The case originated when the 1st appellant, Glenyork Nigeria Limited, imported a large 12RK Ruston Diesel Power Engine No. IH1001B from the United Kingdom to Port Harcourt Sea Port in 1993. After the goods arrived by sea and were discharged to the customs warehouse, the 1st appellant entered into a contract with the respondent, Panalpina World Transport Nig. Limited, to carry out customs clearance of the generator and other goods at Port Harcourt Sea Port and transport them by road to the 1st appellant’s project site at EPZ Calabar, Cross River State. The 1st appellant delivered the shipping documents to the respondent and paid for both customs clearance and transportation costs.

In breach of this contract, the respondent subcontracted the carriage of the goods to a third party, Messrs Tyland Nigeria Ltd. During transportation by road, the engine was badly damaged. The 1st appellant brought in manufacturer’s engineers from the UK to examine and assess the damage. The 2nd appellant, Royal Re-Insurance Co. Ltd, as insurer, had paid to the 1st appellant £95,027.28 in full settlement of the claim for the damage, plus £3,734.50 for professional fees and expenses.

When the appellants demanded payment from the respondent for the damage, the respondent denied liability, claiming that according to a police report, the accident was caused by the driver being pursued by suspected thieves. The appellants subsequently filed suit at the High Court of Lagos State seeking compensation for the damaged engine.

The respondent raised a preliminary objection, arguing that the suit fell within the admiralty jurisdiction of the Federal High Court by virtue of the Admiralty Jurisdiction Act 1991 and therefore the High Court of Lagos State lacked jurisdiction. The trial court overruled the objection, holding that the subject matter was a simple contract of bailment and negligence arising from carriage of goods by land, not an admiralty matter. The respondent appealed to the Court of Appeal, which reversed the trial court’s decision, holding that the matter fell within the admiralty jurisdiction of the Federal High Court. The appellants then appealed to the Supreme Court.

HELD

1.The appeal was allowed.

2.The Court held that the Court of Appeal was wrong in holding that the appellants’ claim for damages for breach of contract and for negligence was an admiralty matter within the admiralty jurisdiction of the Federal High Court.

3.The Court ruled that the High Court of Lagos State had jurisdiction to try the case which is outside the scope of the admiralty jurisdiction of the Federal High Court.

4.The judgment of the Court of Appeal delivered on 5-12-2007 in Appeal No. CA/L/CV/413/20 setting aside the judgment and ruling of the High Court of Lagos State delivered on 24-9-1999 in Suit No. LD/1124/97 was set aside.

5.The judgment and ruling of the High Court of Lagos State delivered on 24-9-1999 in Suit No. LD/1124/97 was restored.

ISSUES

1. Whether the Court of Appeal was right in holding that the appellants’ claim for damages for breach of contract and for negligence was an admiralty matter thereby vesting jurisdiction in the Federal High Court in spite of Section 230(1)(g) of the Constitution of the Federal Republic of Nigeria 1979 (now Section 251(1)(g) of the Constitution of the Federal Republic of Nigeria 1999) and the decision of this Court in Adelekan V Ecu-Line NV (2006) 12 NWLR (Pt 993) 33.?
2. Whether the facts of this case as pleaded constitute a cause of action in admiralty by virtue of S. 1(1)(g) and (2) of the Admiralty Jurisdiction Decree No. 59 of 1991 so as to make the further transportation of goods already discharged from ship and delivered to customs warehouse an extension of the shipping of the goods by sea.?
3. Whether the Court of Appeal was right in holding that the decision in the case of Aluminum Manufacturing Co. Nig. Ltd V Nigeria Ports Authority (1987) 18 NSCC (pt 1) 224 and P.E Ltd & Anors V Leventis Technical Ltd (1992) 23 NSCC (Pt 2) 228 was no longer authority on the interpretation of the provisions of Sections 1(1)(g) and (2) of the Admiralty Jurisdiction Act, No. 59 of 1991.?

RATIONES DECIDENDI

LIMITS OF ADMIRALTY JURISDICTION – TERMINATION OF ADMIRALTY JURISDICTION AFTER DISCHARGE OF GOODS:

“The wordings of S.1(2) of the Admiralty Jurisdiction Act show clearly that it applies to a contract of carriage and delivery of goods from overseas to the importer or consignee that involves transportation by sea and by land. Under such a contract, the carrier or shipper has the contractual duty to carry and deliver the goods to the importer from the time the goods are placed on board a ship for the purpose of shipping to the time the goods are delivered to the consignee or whoever is to receive them whether the goods were transported on land during the process or not.” – Per EMMANUEL AKOMAYE AGIM, J.S.C.

EXTENT OF ADMIRALTY JURISDICTION – CARRIAGE OF GOODS BY LAND AFTER SEA TRANSPORT:

“Where as in this case, the
carrier’s contract of carriage by sea from UK to Port Harcourt Sea Port
completely ended with the off-loading of the goods from the ship and delivery
of the goods to the Custom Warehouse in Port Harcourt and thereafter the
importer or consignee(1st appellant herein) engaged another carrier in
Nigeria(respondent herein) to carry the goods from the Customs Warehouse in the
sea port at Port Harcourt by land to the consignee under a separate contract
not connected with the contract of carriage of the goods by sea from UK, the
Court’s admiralty jurisdiction would not extend to the contract to carry the
goods by land from the Customs Warehouse to the consignee’s project site at EPZ
in Calabar.” – Per EMMANUEL AKOMAYE AGIM, J.S.C.

DISTINCTION BETWEEN SEA CARRIAGE AND SUBSEQUENT LAND TRANSPORTATION – TERMINATION OF ADMIRALTY CONTRACT:

“It had been settled by this Court since P.E. Ltd v. Leventis Tech Ltd (1992) N.S.C.C Vol. 23 that once cargo is unloaded from a ship and received into the warehouse in perfect condition, the shipper’s obligation ends and there cannot be a cause of action in admiralty. Thereafter, there can be a contract of safe carriage by the transporter and the owner of the goods when the goods are carried from one point to the other by road.” – Per HELEN MORONKEJI OGUNWUMIJU, J.S.C.

SCOPE OF ADMIRALTY JURISDICTION – LAND TRANSPORTATION AFTER DELIVERY TO CONSIGNEE:

“I agree with my learned brother that Section 1(2) of the Admiralty Jurisdiction Act cannot cover carriage of the goods from the ship to its final destination on land. The jurisdiction of the admiralty proceedings covers the carriage by sea, its discharge from the ship, its carriage by road to the consignee on land who is to receive the container at the wet or dry dock. After its receipt by the consignee, the further transportation of the goods by the consignee cannot be an admiralty matter.” – Per HELEN MORONKEJI OGUNWUMIJU, J.S.C.

WHEN ADMIRALTY JURISDICTION CEASES – DISCHARGE OF GOODS FROM VESSEL:

“It is clear from the facts pleaded that the claim before the trial Court did not pertain to Admiralty jurisdiction. The good shipped to Port Harcourt had been unloaded from the ship and received into the warehouse without any blemish, loss or damage. The damage to the good occurred while in transit when the Diesel-Powered Engine fell off the trailer. The Admiralty jurisdiction therefore came to an end when the good was off-loaded from the ship and into the warehouse.” – Per HARUNA SIMON TSAMMANI, J.S.C.

REQUIREMENT FOR ADMIRALTY JURISDICTION – GOODS MUST REMAIN ON VESSEL:

“‘It must be observed that from the above pronouncements by the learned Justices of this Court, the Admiralty Jurisdiction of Federal High Court cannot be invoked once the goods carried by a ship have been discharged in the harbour or delivered to the point of destination of the cargo. In any event, for a claim in admiralty to arise, the cargo or goods must still be in the vessel.'” – Per MOHAMMED BABA IDRIS, J.S.C. (quoting Ejiwunmi, JSC in Texaco Overseas (Nig) Petroleum Unltd v. Pedmar (Nig) Ltd)

SEPARATE CONTRACT FOR CARRIAGE OF GOODS BY LAND – NATURE OF CONTRACT AFTER DISCHARGE:

“In the instant case, the cargo had already been discharged from the sea at its destination. The Respondent, as an independent contractor, was engaged with the duty of clearing and conveying the goods to the 1st Appellant. This clearly falls within the scope of a contract for bailment and/or the carriage of goods independent of the sea carriage.” – Per MOHAMMED BABA IDRIS, J.S.C.

JURISDICTION OVER DRY PORT DELIVERIES – TERMINATION OF ADMIRALTY JURISDICTION:

“The key issue in this suit is the destination of the cargo. It is undisputed that dry ports exist in Nigeria, which allow for goods to be delivered to locations distinct from the seaports. This includes the transit of goods to their final delivery point. At this stage, the admiralty jurisdiction of the Federal High Court remains applicable under Section 1(1)(g) of the Admiralty Jurisdiction Act. However, once the cargo reaches the agreed port of delivery, it is customary practice that the goods are considered delivered to the consignee at which point the admiralty jurisdiction of the Federal High Court ceases.” – Per MOHAMMED BABA IDRIS, J.S.C.

CONTINUED RELEVANCE OF PREVIOUS PRECEDENTS – APPLICABILITY OF ESTABLISHED CASE LAW:

“The cases of ALUMINIUM MANUFACTURING CO. NIG. LTD VS. NIGERIAN PORTS AUTHORITY (1987) 18 NSCC (PT. 1) 224 and PETROJESSICA ENTERPRISES LTD VS. LEVENTIS TECHNICAL LTD (1992) 23 NSCC (PT. 2) 228 remain applicable, as the legal provisions upon which they were decided have been re-enacted into Nigerian law and now form part of the country’s legislation. These decisions have been consistently relied upon by this Court in determining matters involving the admiralty jurisdiction of the Federal High Court and the principles established therein remain valid and binding.” – Per MOHAMMED BABA IDRIS, J.S.C.

ERROR IN JURISDICTION DETERMINATION – CORRECTION BY SUPREME COURT:

“It is for this brief reason, coupled with the elaborate dissections marshalled in the leading judgment, that I, too, allow the appeal and restore the decision of the trial Court.” – Per OBANDE FESTUS OGBUINYA, J.S.C.

FORUM COMPETENS FOR CONTRACT OF CARRIAGE BY LAND – STATE HIGH COURT JURISDICTION:

“It is gleanable from the record, the spinal cord of the appeal, that the contract of carriage of goods by land inter partes was outside the perimeter/firmament of contract of carriage of goods by sea and, ipso facto and de jure, outside the province of the admiralty jurisdiction of the Federal High Court. To this end, the Federal High Court was not clothed with the requisite jurisdiction to adjudicate over the appellants’ action. The trial Court, the High Court of Lagos State was the forum competens for the determination of the appellants’ matter.” – Per OBANDE FESTUS OGBUINYA, J.S.C.

FUNDAMENTAL NATURE OF JURISDICTION – NULLITY OF PROCEEDINGS WITHOUT JURISDICTION:

“The law is settled that jurisdiction is a threshold matter and it is very fundamental as it goes to the competence of the Court to hear and determine a suit. Where a Court lacks the jurisdiction to hear the matter, the entire proceeding, no matter how well conducted and decided, will amount to a nullity.” – Per MOHAMMED BABA IDRIS, J.S.C.

INNOVATION IN ADMIRALTY JURISDICTION – LIMITATION OF EXTENDED JURISDICTION:

“I agree with the view of the Court of Appeal that S.1(1) and (2) of the Admiralty Jurisdiction Act 1991 is an innovation in the concept of admiralty and scope of admiralty jurisdiction. The question is what is the nature of that innovation… The implication of this view is that in all situations, where after off-loading goods imported from overseas from the ship that carried them into a Nigerian sea port, their carriage by land from that port and delivery to the importer or consignee comes within the admiralty jurisdiction of the Court. I do not agree with this view as it is not supported by the words and obvious objective of S.S.1(1)and(2) of the Admiralty Jurisdiction Act 1991.” – Per EMMANUEL AKOMAYE AGIM, J.S.C.

CASES CITED

STATUTES REFERRED TO

• Constitution of the Federal Republic of Nigeria 1979 (Section 230(1)(g))
• Constitution of the Federal Republic of Nigeria 1999 (Section 251(1)(g))
• Admiralty Jurisdiction Act 1991 (Sections 1(1)(g), 1(2), 1(3), 2(3), 3)
• Administration of Justice Act 1956 (United Kingdom)
• Constitution Suspension and Modification Decree, No 107 of 1993

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