Legalpedia Citation: (2025-04) Legalpedia 54562 (CA)

In the Supreme Court of Nigeria

Fri Apr 11, 2025

Suit Number: SC.158/2008

CORAM

Mohammed Lawal Garba Justice of the Supreme Court of Nigeria

Adamu Jauro Justice of the Supreme Court of Nigeria

Moore Aseimo Abraham Adumein Justice of the Supreme Court of Nigeria

Obande Festus Ogbuinya Justice of the Supreme Court of Nigeria

Jummai Hannatu Sankey Justice of the Supreme Court of Nigeria

PARTIES

PRECISION ASSOCIASTES LIMITED

APPELLANTS

1. FEDERAL MINISTRY OF FINANCE
2. FEDERAL BOARD OF INLAND REVENUE
3. JOINT TAX BOARD

RESPONDENTS

AREA(S) OF LAW

CONSTITUTIONAL LAW, COURT JURISDICTION, CONTRACT LAW, FEDERAL HIGH COURT JURISDICTION, STATE HIGH COURT JURISDICTION, BREACH OF CONTRACT, STATUTORY INTERPRETATION, JUDICIAL PRECEDENT, CIVIL PROCEDURE, ADMINISTRATIVE LAW

SUMMARY OF FACTS

Precision Associates Limited (the Appellant) entered into a contract with federal government agencies for the production and supply of comprehensive computerized uniform tax tables. The Appellant instituted Suit No. FCT/HC/CV/828/1999 in the High Court of the Federal Capital Territory, Abuja, seeking N2,500,000.00 as special damages for expenses incurred in performing the contract, N10,000,000.00 as general damages for breach of contract, interest on the judgment sum, and costs.

The trial court, per Hon. Justice U.A. Inyang, delivered judgment on 8th December 2004 in favor of the Appellant, awarding special damages of N2,465,750.00, general damages of N5,000,000.00, costs of litigation assessed at N750,000.00, previous outstanding costs, 10% interest on special damages, and 12% interest on the total judgment debt until fully liquidated.

Dissatisfied with the trial court’s decision, the Respondents (Federal Ministry of Finance, Federal Board of Inland Revenue, and Joint Tax Board) appealed to the Court of Appeal. The Court of Appeal, in Appeal No. CA/A/174/2005, unanimously allowed the Respondents’ appeal on 7th January 2008, striking out the suit on the ground that the trial court lacked jurisdiction to entertain the Appellant’s suit, and awarded N20,000.00 costs against the Appellant.

The Court of Appeal relied primarily on the case of NEPA v. Edegbero (2002) and concluded that because the Respondents were federal government agencies, the Federal High Court had exclusive jurisdiction under Section 251(1)(p) of the 1999 Constitution. The Appellant then appealed to the Supreme Court.

HELD

1. The appeal was allowed and found meritorious.
2. The Supreme Court held that the Court of Appeal erred in concluding that the FCT High Court lacked jurisdiction merely because the Respondents were federal government agencies.
3. The Court held that Section 251(1)(p) of the 1999 Constitution does not apply to simple contract disputes, even when federal government agencies are parties.
4. The judgment of the Court of Appeal delivered on 7th January 2008 was set aside.
5. The judgment of the trial court delivered on 8th December 2004 was reinstated.
6. N1,000,000.00 was awarded as costs in favor of the Appellant against the Respondents.

ISSUES

1. Whether the Court of Appeal was right in holding that the High Court of the Federal Capital Territory lacked jurisdiction to entertain the Plaintiff’s claim as formulated, against the three Federal Government Agencies as Defendants?
2. Whether the trial Court had jurisdiction in the matter in view of Section 251(1)(p) of the 1999 Constitution of the Federal Republic of Nigeria?

RATIONES DECIDENDI

THRESHOLD NATURE OF JURISDICTION – CONDITION PRECEDENT TO COURT AUTHORITY

“The law is trite that jurisdiction is a threshold issue – a condition precedent to the exercise by a Court of its authority or power. Where a Court undertakes to exercise jurisdiction which it does not possess, its decision amounts to nothing, as it is a nullity.” – Per Moore Aseimo Abraham Adumein, J.S.C.

DETERMINATION OF JURISDICTION – EXAMINATION OF CLAIMANT’S STATEMENT

“In the determination of the issue of whether or not a Court has jurisdiction, it is the claimants statement of claim, and not the defendant’s statement of defence, that must be examined.” – Per Moore Aseimo Abraham Adumein, J.S.C.

CONSTITUTIONAL INTERPRETATION – GOLDEN RULE OF CONSTRUCTION

“In the interpretation of a constitution or a statute, the golden rule is that ‘where the words…..are clear, plain and unambiguous, there is no need to give them any other meaning than their ordinary, natural and grammatical construction would permit unless that would lead to absurdity’.” – Per Moore Aseimo Abraham Adumein, J.S.C. (quoting Adekeye, JSC)

FEDERAL HIGH COURT JURISDICTION – ADMINISTRATION AND MANAGEMENT SCOP

“Therefore, the term ‘administration or management and control’, in Section 251 (1)(p) of our Constitution, logically means: the direction, oversight and regulation of the Federal Government or any of its agencies, thereby granting the Federal High Court exclusive jurisdiction over causes or matters relating to the internal management and operations of the Federal Government and its agencies.” – Per Moore Aseimo Abraham Adumein, J.S.C.

SIMPLE CONTRACT DISPUTES – EXCLUSION FROM FEDERAL HIGH COURT JURISDICTION

“What is more, by Section 230(1) of the Constitution of the Federal Republic of Nigeria, 1979 and even by Section 251 of the 1999 Constitution, the Federal High Court, has no jurisdiction in matters relating to simple contracts.” – Per Moore Aseimo Abraham Adumein, J.S.C. (quoting Ikechi Francis Ogbuagu, JSC)

DOCTRINE OF STARE DECISIS – BINDING NATURE OF SUPREME COURT DECISIONS

“Under this principle of law, it has long been acknowledged that this Court – the Supreme Court of Nigeria – ‘is the highest and final Court of Appeal in Nigeria. Its decisions bind every Court, authority or person in Nigeria. By the doctrine of stare decisis, the Courts below are bound to follow the decisions of the Supreme Court. The doctrine is a sine qua non for certainty to the practice and application of law’.” – Per Moore Aseimo Abraham Adumein, J.S.C. (quoting Katsina-Alu, JSC)

FEDERAL GOVERNMENT AGENCIES AS PARTIES – INSUFFICIENT FOR FEDERAL HIGH COURT JURISDICTION

“It is….not enough only to have an agency of the Federal Government as a party for the Federal High Court to have exclusive jurisdiction under Section 251 (1) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended).” – Per Moore Aseimo Abraham Adumein, J.S.C. (quoting Rhodes-Vivour, JSC)

SUBJECT MATTER CONSIDERATION – GUIDING PRINCIPLE FOR JURISDICTION

“While the provision of Section 251(1) of the Constitution is restrictive in its application, I hasten to say however, that it does not confer a blanket exclusive jurisdiction in cases involving the Federal Government and its agencies hence the subject matter consideration which must serve as a guiding principle.” – Per Moore Aseimo Abraham Adumein, J.S.C. (quoting Clara Bata Ogunbiyi, JSC)

FEDERAL HIGH COURT JURISDICTION – DUAL REQUIREMENTS FOR ASSUMPTION

“Clearly, the provision does not vest the Federal High Court with absolute jurisdiction over all actions to which the Federal Government or any of its agencies is a party. The exclusive jurisdiction of the Federal High Court donated by Section 251(1) generally, including paragraph (p), is determined not only by the parties to an action, but also the subject matter of the action.” – Per Adamu Jauro, J.S.C.

BREACH OF CONTRACT CLAIMS – PROPER FORUM DETERMINATION

“Although it is not in doubt that the Respondents herein are agencies of the Federal Government, it is equally clear that the subject matter of the action was breach of contract and the Appellant sought damages for the breach. Thus, the subject matter of the action has nothing to do with the administration or the management and control of the Respondents.” – Per Adamu Jauro, J.S.C.

JURISDICTIONAL DETERMINATION FACTORS – PARTIES AND SUBJECT MATTER EXAMINATION

“What I am otherwise saying here is that to determine the applicability of the provisions of the said Subsections 1(p), (q) and (r) of Section 251 to an action… the subject-matter of the cause of action in the matter as well as the parties so sued in the action must be examined to ascertain, whether both factors which must co-exist have been so connected to the action as to bring the action within the purview of the provisions of the said Section 251(1) (supra) for the action to come within the exclusive jurisdiction of the Federal High Court.” – Per Jummai Hannatu Sankey, J.S.C. (quoting Chukwuma-Eneh, JSC)

SIMPLE CONTRACT NATURE – FEDERAL HIGH COURT LACK OF JURISDICTION

“It is gleanable from the record, the spinal cord of the appeal, that the contractual relationship inter partes, production and supply of comprehensive computerised uniform tax tables for the States, was a simple contract par excellence. It is obvious that the respondents were federal government agencies. However, the inelastic position of the law, warehoused in a galaxy of ex cathedra authorities, is that the Federal High Court is not showered with the jurisdiction to entertain any action which orbits around simple contract.” – Per Obande Festus Ogbuinya, J.S.C.

PROPER FORUM FOR CONTRACT DISPUTES – STATE HIGH COURT COMPETENCE

“Per contra, it is the trial Court and a High Court of a State that is endowed with the vires to determine actions weaved on a simple contract. To this end, the trial Court was/is the forum competens for the determination of the appellant’s action which midwifed the appeal.” – Per Obande Festus Ogbuinya, J.S.C.

CASES CITED

STATUTES REFERRED TO

• Constitution of the Federal Republic of Nigeria, 1999 (as amended)
• Constitution of the Federal Republic of Nigeria, 1979
• Section 251(1)(p) of the 1999 Constitution
• Section 230(1)(p), (q) and (r) of the 1979 Constitution
• Section 272(1) of the 1999 Constitution

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