Commercial Law Index

The background to this application is that the applicant filed against the respondent seeking to recover US$75,000, as payment made in error under a guarantee, interest and costs. The respondent counter-claimed for US$31,767 being the balance owed by the applicant on the guarantee, general damages for breach of the contract of guarantee, interest and costs.

The issue in contention was whether the plaintiff having represented to the defendant that it was entitled to a payment and even made part payment was barred by estoppels from claiming a refund of monies paid to the defendant after the failure of the third-party to make good on its obligations to the plaintiff.

It was held that a court can only exercise the discretion to grant a stay of execution if there are special circumstances and good cause to justify a stay. The inability of the victorious party to be able to refund the decremental amount in the event of a successful appeal is one of such special circumstances if proved.

The court held that the applicant failed to adduce any evidence to show that the respondent will not be able to restore it to the status quo ante if its appeal succeeded. Also, the deponent should have gone a step further to lay the basis upon which the court could make a finding that the applicant would have suffered substantial loss as alleged. The applicant should have gone beyond the vague and generalised assertion of substantial loss in the event a stay order is not granted. It is against this background that the court dismissed the application.

The respondent bought a piece of property from a third party. After the respondent had taken possession of the property, he became aware of the fact that his predecessor-in-title had mortgaged the property to the appellant. The respondent paid off the outstanding debt and thereafter demanded the release of the title deeds to him. Instead, the appellant demanded some authorisation from his predecessor-in-title before the documents could be released to him. The respondent instituted a claim on this basis. The trial court judgment was in the respondent’s favour.

After the respondent attached the property the appellant filed an application praying for an order staying execution of the judgment, particularly the sale of the property and ordered release thereof; before hearing of the application. The trial court dismissed this application.

The appellant eventually appealed to this court asking for the same. The appellant urged this court to allow the appeal, set aside the ruling of the court below and grant an order directing the High Court to retain the amount deposited as per judgment.

This court held that the order sought to be stayed was made by the trial court and there was no appeal against that order to the Court of Appeal. That being the case, it was held that it would be a wasteful academic exercise to delve into the merit of the issue. Consequently the appeal was dismissed.

The appeal was against a garnishee order attaching a sum of approximately N97 million belonging to the appellant granted by the lower court. The appeal was based on the claim that the garnishee order was made without hearing the appellants’ earlier motion for a of stay execution. This, the appellants argued, was a violation of their right to a fair trial. 

The respondent raised a preliminary objection that the appellant had no standing because it was judgement debtor, not the garnishee. It further argued that the appellants had not obtained leave to appeal.

The appellants responded by pointing out that they were respondents to the garnishee application, and that the funds that were to be attached belonged to them. Thus, they had locus standi (the standing and right to file this appeal).

The court held that it is only the garnishee that can appeal an order made by the court. It ruled that garnishee proceedings are strictly between the creditor and the garnishee. It found that the appellant lacked locus standi to file the appeal and the appeal was dismissed.

The court determined that this was an application for special leave to appeal against the refusal of the Court of Appeal to discharge the order of the single judge of the Court of Appeal refusing to stay the execution of the preservation order made by the High Court.

The court determined whether the refusal to suspend the decision of the Court of Appeal could render the subsequent judgment nugatory. The court noted the difference between a stay and a suspension order. Further, the court stated that applications for the suspension of orders or decisions of lower courts where the conventional means of applying for stay of execution is not possible. The court held that the fact that the court granted the applicant leave to appeal against the ruling of the Court of Appeal was not an essential condition for the suspension of the ruling sought to be impeached. The court observed that the applicant raised the point that the failure of the application would render the subsequent judgment nugatory but failed to prove exceptional circumstances to merit the suspension of the order. Accordingly, the application was dismissed.