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CaseLaw

URS Reichie V. Nigeria Bank For Commerce and Industry (2016) CLR 2(o) (SC)

Judgement delivered on February 26th 2016

Brief

  • Liquidated Sum - Statutory provision in relation to
  • Fresh matter on Appeal – Propriety of
  • Privity of Contract – Nature of
  • Order 10 Rule 1 High Court of Lagos (Civil procedure) Rules 1972
  • Order 10 Rule 2 High Court of Lagos (Civil procedure) Rules 1972

Facts

This is an appeal from the Court of Appeal, Lagos Division Coram: George A. Oguntade, Pius Olayiwola Aderemi and Christopher M. Chukwuma-Eneh, J.J.C.A. against the judgment delivered by P.O Aderemi, J.C.A. (as he then was) on 02/12/2002 in which that Court held there was no contractual relationship between the Plaintiff/1st Respondent and 3rd Defendant/Appellant/ Respondent necessitating an order for summary judgment under the provisions of the Lagos High Court (Civil Procedure) Rules by which the Court below allowed the appeal, set aside the judgment of the trial Court dated 4th July, 1994 per Akinsanya J, and dismissed the suit as instituted in the trial Court against the Appellant now Respondent.

BACKGROUND FACTS

The facts would be better gleaned with reference to the Plaintiff/Appellant's Statement of Claim and the Affidavit in support of the Summons for Judgment deposed to by Oluyomi George-Taylor at the trial Court as follows:

  • a
    The Plaintiff/Appellant is a business man resident in Switzerland.
  • b
    The 1st Defendant is the alter ego of the 2nd Defendant which is a limited liability company with its office at Akure, Ondo State.
  • c
    The 3rd Defendant is a banker carrying on business in Nigeria.
  • d
    About November, 1990, the 1st and 2nd Defendants raised a loan of N90,510,00 from the Respondent with which they met certain obligation of the 2nd Defendant to the 3rd Defendant by way of a non-refundable part payment of legal fees, the repayment of which, it was understood, that "the 1st and 2nd Defendants shall be responsible for jointly and severally as primary debtors."
  • e
    The 1st and 2nd Defendants, by their solicitors' letter to the Plaintiff's agent, of 07/12/92, exhibited to the verifying affidavit in support of the summons for judgment, confirmed the payment of the sum of N90,510.00 to the Appellant but stated that it was "on the understanding that the said amount would not be refundable in case the project did not take off."

The Plaintiff in his Statement of Claim at the Trial Court claims:

  • 19
    "WHEREOF the plaintiff claims against the Defendants jointly and severally the sum of N90,510,00 (Ninety Thousand, Five Hundred and Ten Naira only) with interest at the rate of 45% per annum from the 9th day of January, 1991 until the final liquidation of the said sum being:
    • i
      Money payable by the Defendant to the Plaintiff on account of money had and received by the Defendants for the use of the Plaintiff,
    • ii
      FURTHER AND IN THE ALTERNATIVE sum due and payable by the first Defendant upon the first Defendant's covenant and undertaking to indemnify the Plaintiff for paying the sum of N90,510.00 to the third Defendant at the instance of the first Defendant and on behalf of the second Defendant
    • iii
      FURTHER AND IN THE ALTERNATIVE, money held in constructive Trust by the third Defendant for the benefit of their Plaintiff."
    • The 3rd Defendant duly entered appearance with a verifying affidavit, and subsequently, the plaintiff filed a summons for summary judgment under Order 10, Rules 1 & 2 High Court of Lagos (Civil procedure) Rules 1972 (hereafter referred to as the Lagos High Court Rules) for an order - "granting the plaintiff/Applicant liberty to enter final judgment against the Third Defendant in the sum of N9O,52O.OO with interest at the rate of 45% per annum from (sic) the 9th day of January 1991 until the whole sum is finally (sic) liquidated.......... FURTHER AND IN THE ALTERNATIVE, money held in constructive Trust by the third Defendant for the benefit of their Plaintiff."

    The 3rd Defendant duly entered appearance with a verifying affidavit, and subsequently, the plaintiff filed a summons for summary judgment under Order 10, Rules 1 & 2 High Court of Lagos (Civil procedure) Rules 1972 (hereafter referred to as the Lagos High Court Rules) for an order - "granting the plaintiff/Applicant liberty to enter final judgment against the Third Defendant in the sum of N9O,52O.OO with interest at the rate of 45% per annum from (sic) the 9th day of January 1991 until the whole sum is finally (sic) liquidated..........

    The 3rd Defendant intending to raise points of law from the bar filed no affidavit but unfortunately, on the 4th July, 1994 when the summons for judgment was heard, learned counsel for 3rd Defendant was absent and judgment was entered against the 3rd Defendant.

    By an application by notice of motion dated 05/07/94 and filed 07/07/94, the 3rd Defendant/Respondent promptly applied to set aside the summary judgment entered against it under Order 10, Rules 1 & 2 and in the absence in Court of both the 3rd defendant and its counsel. It is supported with an affidavit of 10 Paragraphs explaining the 3rd defendant's reasons for not filing an affidavit of facts entitling it to defend the action and for the absence of its counsel in Court on the day the said summary judgment was entered on 04/07/99. The 3rd Defendant attached as Exhibit 'C' to this affidavit its statement of defence dated 01/07/94 and filed the same morning of 04/07/99 on which the summary judgment was entered but was not before His Lordship at the time of hearing the application for summary judgment.

    The 3rd Defendant in its said statement of defence pleads inter alia, to the effect

    • 1
      That upon 2nd Defendant's application to the 3rd defendant for a loan of N6,034,000.00, the same was approved by the 3rd defendant subject, among other things, to the 2nd defendant's payment of a non-refundable fee of 1 1/2% of the loan amount in the sum of N90,510.00.
    • 2
      That the 3rd Defendant was a complete stranger to the agreement between the Appellant and the 1st and 2nd Defendants whereby the Appellant let to the 1st and 2nd Defendants the said non-refundable amount of N90,510.00.
    • 3
      That the writ of summons was null and void having been issued in Lagos for service in Ondo State without leave of Court as required by law.
    • The learned trial Judge duly heard argument on the motion to set aside the summary judgment and dismissed the same in his ruling dated 19/05/95, hence the appeal to the Court of Appeal.

      The Court of Appeal allowed the appeal. The Plaintiff/Appellant appealed to the Supreme Court.

Issues

Whether the absence of contractual relationship between the Appellant and...

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