CORAM
PARTIES
1. MYEKO NIGERIA LTD 2. MR KELECHI DOZIE 3. MR JUNIOR ADEWUNMI
ASSET MANAGEMENT CORPORATION OF NIGERIA RESPONDENTS
AREA(S) OF LAW
SUMMARY OF FACTS
The Appellants filed a notice of preliminary objection at the Federal High Court, Lagos State against the action of the Respondent challenging the jurisdiction of the lower court to entertain the suit on the grounds that the action was statute barred and the Respondent lacked locus standi to institute the action. The Appellants referred to Section 35(5) of the AMCON Act, that the cause of action is the date of purchase of eligible asset and that this asset was purchased in 2010 while the suit for recovery commenced in 2017.The Respondent contended that the Appellants had replied via a letter acknowledging the debt and thus revived the cause of action, the lower court dismissed the preliminary objection and held that it had jurisdiction. Dissatisfied with the ruling of the lower court, the Appellants have filed a notice of appeal against the ruling contending that the trial court erred in law when it assumed jurisdiction to entertain and adjudicate upon the suit which was statute barred by virtue of Section 35(5) of AMCON ACT and Section 8(1)(e) of the Limitation Law of Lagos State.
HELD
Appeal Dismissed
ISSUES
Whether the lower court was right when it held that it has jurisdiction to entertain and adjudicate upon the suit in view of the fact that the Respondent’s action was statute barred by virtue of the provision of Section 35(5) of Asset Management Corporation of AMCO) ACT 2015 (as amended) and Section 8(1) (e) of limitation law of Lagos state. Whether the lower court was right when it relied on the case of Nsitm V Kalifeco Nigeria Limited (2010)13 NWLR (PT 1211) 370 to Hold that cause of action in the instant case accrued upon the purported acknowledgement of debt, when the case is essentially and radically different from the instant case. Whether the lower court was right when it failed to make any pronouncement s on the issue of locus standi and failure to make any pronouncements on the issue of locus standi and failure of the respondent to fulfill the condition precedents before commencing the action at the lower court, argue by the Appellants in their preliminary objection and whether this honourable court can stand in the stead of lower court and determine the questions pursuant to section 15 court of appeal act cap C36 laws of the federation of Nigeria 2004.’’
RATIONES DECIDENDI
GROUNDS OF APPEAL –PRINCIPLES IN DETERMINING WHETHER A GROUND OF APPEAL IS OF LAW, FACTS OR MIXED LAW AND FACTS
“In Opuiyo v Omoniwari (2007) 16 NWLR (PT. 1060) PG 418 the supreme court set down Guiding principles in determining whether a ground of appeal is that of law, fact(s) or mixed law and facts thus:
“In the determination of the question whether or not a ground of appeal is of law or fact/mixed law and fact, it is important to consider together the principal complaint and the particulars of error provided there under. When the approach is followed in relation to the first ground of appeal above, there is no doubt that the ground is of mixed law and fact. As a matter of law, a court has the duty to consider the issues submitted to it for adjudication. Where a Court fails to consider and adjudicate on such issues, it is usually an error of law because the omission constitutes a denial to the party complaining of his right of fair hearing as enshrined in the constitution. However, as the complaint is an invitation to the appellate court to consider those matters of fact which had not been considered by the court below, it becomes an issue of fact or mixed law and fact before the appellate court.” per OGUNTADE, J.S.C. (P. 11, PARAS. C-G)”
LEAVE OF COURT – INSTANCE WHERE LEAVE OF COURT IS REQUIRED IN FILING GROUNDS OF APPEAL
“Furthermore, this action coupled with the provisions of the practice direction would be examined before the application of the law in this direction. It then becomes a question of law; therefore this issue dwells on mixed law and facts and certainly would require leave of court which is missing here. See Ugwu v State (2013) LPELR – 20177(SC); Oluwole v LSDPC (1993) 5 SC1.”
ACCRUAL OF CAUSE OF ACTION – WHEN DOES THE RIGHT OF ACTION ACCRUE WITH RESPECT TO ELIGIBLE BANK ASSET(S) ACQUIRED BY THE ASSET MANAGEMENT CORPORATION OF NIGERIA?
“It is evident from the foregoing that there is no dispute on the point that by virtue of Section 8(1)(a) of the Limitation Law of Lagos State, which provides that claims based on simple contract(s) cannot be sued upon after 6 (six) years of the accrual of the cause of action. It will appear that the Appellants’ contention in this appeal revolves around the proper construction of the provision of Section 35(5) of the Asset Management Corporation of Nigeria (AMCON) Act, 2015 (as amended) vis a vis the provision of Section 38 of the Limitation Law of Lagos State. For the avoidance of doubt, these provisions relate to the mode of accrual of cause of action with respect to eligible bank asset(s) acquired by the Asset Management Corporation of Nigeria.
“For the purpose of the provision of the Limitation Law of a State or the Limitation Act of the Federal Capital Territory, with respect to any debt owed to the Corporation by reason of its acquisition of an eligible bank asset, time shall begin to run, and the cause of action deemed to arise from the date of the purchase of the eligible bank asset.”
On the other hand, Section 38 of the Limitation Law of Lagos State provides that:
Where –
any right of action has accrued to recover any debt; and
the person liable therefore has acknowledge the debt;
the right of action shall be deemed to have accrued on and not before the date of the acknowledgment.”
INTERPRETATION OF STATUTE, COURT, CONSTRUCTION OF STATUTE – DUTY OF THE COURT OF APPEAL IN THE CONSTRUCTION OF STATUTE
“Indeed, the primary duty of this court in the construction of statute, particularly where the words contained therein are clear and unambiguous, is to construe same in their ordinary and literal meaning. As a matter of fact, it is certainly not the duty of the court to construe the wordings of a statute in such a manner as to avoid its consequence; that I dare say, is within the boundary of the legislature. See Amaechi v INEC [2008] 5 NWLR (PT 1080) 227 SC; Kraus Thompson Org. v NIPSS [2004] 17 NWLR (PT 901) 44; Aromolaran v Agoro (2014) LPELR – 24037 SC.”
ACTION, LIMITATION LAW CAUSE OF ACTION – TIME WITHIN WHICH THE CAUSE OF ACTION ON THE ACQUISITION OF ELIGIBLE BANK ASSET MAY ACCRUE
“It seems to me from the clear wordings of Section 35(5) of the AMCON Act, that the draftsmen thought is right and for good reason, to explicitly state the when the cause of action in relation to the acquisition of eligible bank asset may arise or accrue. As a matter of fact, the section leaves no one in doubt that “time shall begin to run and the cause of action deemed to arise, from the date of the purchase of the eligible bank asset.” By this statutory intervention encapsulated in Section 8(1)(a) of the Limitation Law and Section 35(5) of the AMCON Act, an action predicated upon the acquisition of eligible bank asset must then be commenced, within 6 (six) years of the acquisition of the eligible bank asset(s) by the Respondent. But that is not the end of the matter, it is my view, which I believe to be the correct one that even though the combined effect of provisions of section 8(1)(a) supra has adequately provided for when time shall begin to run and the cause of action deemed to arise, the provision of Section 38 of the Limitation Law clearly permits of certain exception to the general provision of section 8(1)(a).”
ACTION, LAW OF BANKING ACKNOWLEDGMENT OF DEBT–IMPLICATION OF ACKNOWLEDGEMENT OF DEBT FOR DETERMINING WHEN A CAUSE OF ACTION ARISES
“Section 38 of the Limitation Law of Lagos State deals with the acknowledgement of debt and its implication for the purpose of determining when a cause of action arises. The authorities are settled that acknowledgement of debt awakens and renews a cause of action, thereby giving the comatose cause of action a new breath of life. Such an acknowledgement of debt may be established where a debtor makes unequivocal admission of the debt owed the creditor after the limitation law has caught up with the debt. It is now settled law that, unlike other causes of action, limitation of action does not extinguish the right to the debt but it merely bars the right to recover the debt because of lapse of specified period in the law of Limitation from the accrual of cause of action. See Nigeria Social Insurance Trust v Klifco Nigeria Limited (2010) LPELR – 2006(SC); [2010] 13 NWLR (PT 1211) 307 SC where the Supreme Court held as follows:
“… Meaning that there must have been an initial indebtedness which according to the Limitation law is statute barred arising after a lapse of a period of years from the accrual of cause of action in the case. The limitation law here is a period of 6 years being a simple debt. However, where there is acknowledgment of the debt, the right to recover by an action is revived and it is the crux of the matter in this case.
It must be noted that what constitutes acknowledgment is a matter of fact depending on each case. See Thadant And Anor V. National Bank Of Nigeria (1967 – 1975) 2 NBLL. 383 per COKER, JSC. What I must further state as settled law that is that the law of Limitation here has not extinguished the right to the debt; the instant debt has no right to recover the debt because of lapse of specified period of time in the law of limitation from the accrual of cause of action. However, where there is acknowledgment of debt, which must be in writing signed by the party that is liable, the right to recover the debt by action is revived and what constitutes acknowledgment is such cases is a matter of fact in each case, If I may repeat. In other words, what constitutes acknowledgment will depend on the construction placed on the words by the court in ascertaining what the words mean. See Spencer v Hemmerde (1922) A. C519 at 5264 (Supra). As rightly held in the Spencer case (Supra) at P. 526 the question is “what the debtors words mean; and not what he meant when he wrote them”. Thus making the debtors motive for the acknowledgement most irrelevant in the matter.
The defendant has inter alia alleged that the revived debt in this matter not having been quantified that further agreement will be required and so that the alleged acknowledgement, if at all, as per Exhibit “J” is insufficient to revive the debt. Let me observe pre-emptorily, that I take the view that the quantification in figures of the outstanding amount of the debt is capable of ascertainment by mere calculation without further evidence.
I must recapitulate that this being a simple debt the period of limitation is 6 years. What seems to emerge from the opposing contentions of the parties here is whether by the above underlined phrase i.e. the acknowledgment as in the extract of Exhibit “J” it is a sufficient and clear acknowledgment of the Defendant’s Indebtedness that a promise to pay is inferable from it and so take this matter outside the operation of the limitation law; see Ajike V Cardoso (1939) WACA 134.
I have above set out an abstract of Exhibit “J” – the acknowledgement letter from the defendants and to observe that the Court has to satisfy itself that by construing the words from the acknowledgment letter it can be inferred as a matter fact if I may come again, a promise by the debtor to pay the debt. By a line long of decided cases acknowledgement of debt owed to a Creditor has to be unconditional and unequivocal. The words used by the debtor to recognize the existence of the instant debt are “that our computation of our indebtedness differs from yours…” These words having been construed in the context of the letter couldn’t be more absolute and unconditional as to the acknowledgment of indebtedness of the defendant to the plaintiff. Nothing could be more positive than the said phrase i.e underlined words in acknowledging of the said debt. There is no doubt of their being absolutely and unconditionally unequivocal on the indebtedness. It is not required as espoused in many cases that the precise amount i.e figures of the debt must be stated, in this case in Exhibit “L” and as I said above the amount here is ascertainable without any difficulty and without further evidence. In Ajike v Cardoso And Anor (Supra) this point has been highlighted and if I may restate, it has held that it is not necessary to set out the precise amount of the debt. See also Thadant And Anor V National Bank Of Nigeria (Supra)” –
LAW OF BANKING ACKNOWLEDGMENT OF DEBT– CONDITIONS FOR ACKNOWLEDGEMENT OF DEBT
“A community reading of Sections 38 and 45 of the Limitation Law of Lagos State for the conditions for acknowledgement, to wit, that every acknowledgment must be in writing and signed by the person making the acknowledgement. See First Bank Of Nigeria Plc v Standard Polyplastic Industries Limited (2018) LPELR – 44081 (CA).”
STATEMENT AND ADMISSION MADE IN THE COURSE OF NEGOTIATION – WHETHER STATEMENT AND ADMISSION MADE IN THE COURSE OF NEGOTIATION CAN BE RELIED UPON BY THE COURT
“I agree with the Appellants’ counsel that the position of the law is firmly settled that a statement made in the course of a negotiation and admission made during a bonafide attempt to settle a dispute cannot be relied upon by the court. I am however persuaded by the reasoning and conclusion of this court in a recent judgment in Pacers Multi-Dynamics Limited & Anor v Ecobank (2018) LPELR – 45008 (CA), where my learned brother, IKYEGH, J.C.A. aptly held:
“A letter written with the expression ‘without prejudice’ is restricted only to cases where there is unresolved dispute or negotiation is still in progress and is yet to crystallize into an agreement between the parties to the dispute in which case the letter or correspondence is inadmissible in evidence on the footing that con?dential overtures so made should be excluded from evidence on the ground of public policy. Because if it is not so, amicable settlement of disputes would be difficult and the defendant would be prejudiced and/or unprotected by a grasping adversary who may exploit the amicable arrangement to settle the dispute by relying on an offer made in the course of the negotiation as binding on the person that made it in disregard of the fact that it was made under disputed circumstances or at the time there was dispute between the parties. In the instant case, the extract (supra) which referred to what was arrived at a meeting between the representatives of the parties on 11-08-1999, while the letter, Exhibit AS1, was on 18-11-99 indicated concluded agreement on the quantum of indebtedness in that meeting of 11-08-99 which is unequivocal admission of the amount in question by the appellants, so the expression “without prejudice” in Exhibit AS1 became cosmetic or decorative and/or impotent and did not drain the agreed indebtedness of potency and e?cacy vide Greyshot Enterprises Limited v. The Hon. Minister of Agriculture and Ors. (supra) at 22 – 23 where it was held inter alia that if, however, there is a concluded agreement the fact that the correspondence is ‘without prejudice’ would not affect its admissibility in evidence. Thus in United Bank for Africa Limited v. I.A.S. Company Limited (2001) FWLR (pt.75) 578 cited with approval by the learned author, S.T. Hon. SAN, in his great works titled ‘S.T. Hon’s Law of Evidence in Nigeria (vol.II)’ published in 2012 in pages 858 – 859 thus ” If ‘A’ owes ‘B’ N1,000.00 and “A” writes ‘B’ admitting that he owes the amount but offers to pay N900.00 in final settlement, it seems to me that even if the offer is made without prejudice, the evidence of admission ought to be receivable in evidence… Now, can it be said that the letters written by the 1st plaintiff’s solicitor under the cover “without prejudice” ought to be excluded from evidence on the ground that they covered admissions made in the course of bona ?de negotiation? I think not. The solicitor to the 1st plaintiff/respondent never in any of the letters disputed that a loan of N70, 000.00 was granted to his client. … therefore the plaintiff’s solicitor by writing exhibit BON7 was not in the course of negotiating to resolve a dispute …Merely putting the heading on the letter “without prejudice” cannot in my view make it inadmissible. This was not a negotiation in good faith to compromise a dispute.” The subsequent letters in question being on the modalities for repayment of the agreed indebtedness cannot be said to be continuation of negotiation of the quantum of indebtedness because once a debt is admitted, the mode or time for repayment is a different matter vide Kenfrank Nigeria Limited and Ors. v. Union Bank of Nigeria Plc (2002) 8 NWLR (pt.789) 46 at 73 per the lead judgment prepared by Ikongbeh, J.C.A., (now of blessed memory).”
LAW OF BANKING, STATUTE ACQUISITION OF AN ELIGIBLE BANK ASSET – IMPORT OF SECTION 33 & 34 OF ASSET MANAGEMENT CORPORATION OF NIGERIA ACT
“However Section 33 provides a cover for the corporation, bearing in mind states thus;
33. (1) As soon as possible, after the acquisition of an eligible bank asset from an eligible financial institution, the eligible financial institution shall notify the relevant debtor, associated debtor and guarantor or surety of the debtor and any other person that the Corporation directs of the acquisition of the eligible bank asset by the Corporation.
(2) The Corporation shall not be liable for any failure or delay in notifying any person under subsection (1) of this section and such failure or delay shall not invalidate the eligible bank asset concerned.
Also in section 34 of AMCON ACT;
“Subject to the provisions of the Land Use Act and section 36 of this Act, where the Corporation acquires an eligible bank asset, such eligible bank asset shall become vested in the Corporation and the Corporation shall exercise, all the rights and obligations of the eligible financial institution from which the eligible bank asset was acquired in relation to the bank asset, the debtor concerned and any guarantor, surety or receiver, liquidator, examiner or any other person concerned and the eligible financial institution shall cease to have those rights and obligations.
(2) Subject to the provisions of the Land Use Act and section 36 of this Act, the vesting of an eligible bank asset in the Corporation and the assignment of every relevant contract relating to an eligible bank asset in the Corporation upon the acquisition of an eligible bank asset by the Corporation as contemplated in subsection (1) of this section shall take effect and be effective notwithstanding any-
(a) contractual restriction on the acquisition, assignment or transfer of the bank asset or any part thereof or any contract relating thereto ; or (b) requirement for a consent, notification, registration, authorization or license (by whatever name and however described) –
CASES CITED
None
STATUTES REFERRED TO
Asset Management Corporation of Nigeria Act|Limitation Law of Lagos State|