Commercial Law Index

This case concerned an action for breach of contract, and an objection to jurisdiction. The dispute emanated from a loan advanced to the plaintiff by the defendant. The plaintiff deposited his share certificate as security for the loan. The plaintiff contended that the loan was fully repaid and the security discharged; notwithstanding this the defendant informed the Dar es Salaam stock exchange that the share certificates has not been discharged and that the defendant still held an interest in the share certificate. The plaintiff complained to the court that the defendant’s conduct was defamatory and had affected its operation.

The defendant raised an objection to the claim arguing that the court lacked jurisdiction to hear the matter. It based its argument on the grounds that the claim was based on an amount below 100 million shillings. The plaintiff on the other hand argued that the claim was based on US $2.5 million, an mount which falls within the jurisdiction of the court if converted into shillings.

In deciding the case, the court dismissed the defendant objection and ruled that it had jurisdiction to hear the matter.

The applicants sought leave to defend a summary suit brought by the respondent for outstanding loan amounts. The applicants claimed that if granted leave to defend they would prove that the debt was satisfied in full.

The court held that it was to determine whether the applicant demonstrated a triable issue. The applicant is only required to show a fair and reasonable defense. The amendment to the Civil Procedure Code introduced by the Mortgage Financing Act was applicable in the circumstances. It provided that an applicant may be granted leave to defend a summary suit if he proved that he did not take a loan, or has paid it. The court held that the averment that the debt was paid in full raised a triable issue that can only be proved if the applicants were granted leave to defend.

When considering whether to grant leave to defend a summary suit, the court may consider the principles set out by the Indian Supreme Court in M/S Mechalec Engineers & Manufacturers v M/S Basic Equipment Corporation 1977 AIR 577, that the defendant has a good defense; if the defendant raises a triable issue that they have a fair, good faith, or reasonable defense; if the defendant discloses facts that may be deemed sufficient to entitle them to defend; and if there is no defence, or the defence raised is illusory. These principles are to be applied after the court is satisfied that the applicant has met the requirements of the Mortgage Financing Act amendment to the Civil Procedure Code.

The application was granted.

The court considered the proper remedy for a sub judice matter. Further, if the matter was a pending suit according to High Court Procedure rule 47 in the absence of an application made within six months of the last adjournment.

The court held that in terms of Civil Procedure Code s 8 when a matter is found to be sub judice the proper order is an order for stay of the matter. The court also defined the term ‘hearing’ in the ambit of rule 47 of the High Court Procedure Rules. The court held that the term is neither defined in the rules nor Civil Procedure Code. In that light, the court held that when a matter is called for orders, there is an issue of law or fact which is determined.  Further, hearing and trial have different meanings. Therefore, the term hearing in rule 47 covers any judicial session before a judge or registrar.

The court was of the view that it would not deal with the matter because the court and same presiding officer had previously made the order. The court also found that the matter was called for hearing while it was still pending, and the court decided to adjourn the matter sine die. In that light, the court concluded that there was no application made within six months of the last adjournment as required by rule 47.

The court accordingly dismissed the application.

The case dealt with an application by a decree holder to appoint a receiver to execute a judgment instead of a court broker.

The court held that appointment of a receiver is neither automatic nor a matter of right but is granted where there is no other effective away of executing a debt. The court held that the applicant did not provide reasons as to why a receiver would be able to execute the judgment better than a court broker. The court held that the court broker could be an effective route and hence a receiver should not be appointed. Both a receiver and court broker are accountable to the court so the court broker will be able to execute the debt effectively. Only when the court broker cannot execute effectively, can a receiver who is a disinterested third party be appointed.

The application was rejected.

After the failure of mediation between the parties to a dispute, the matter proceeded to litigation. At a certain point, witness statements were to be filed to be filed. The applicant was meant to submit four witness statements but only filed one of them. The applicant thereafter requested an extension of time, citing difficulty obtaining the relevant name from the Ministry of Lands. The court held that the court has the discretion to grant or deny an extension of time, but that the applicant must have a sufficient reason for requesting the extension. The court granted the application because it was clear that the witness statements could not be obtained and filed with the permitted timeframe due to the delay in receiving the names.

In this case the applicant sought relief to set aside an ex parte order. The case illustrates the enquiry into determining who can rightly sue in the name of a corporation.

The court considered whether the High Court had made a consent order, or an ex parte order. The court held that though the order against the fifth respondent was a consent order, the order against the applicant was ex parte because the applicant was not present. The court held that the law gives the remedy to set aside an ex parte order and that it had the power under s 93 of the Civil Procedure Code (CPC) to enlarge the time period for an application.

The court considered the issue as to who was entitled to bring an action for and on behalf of the applicant. The court held that it was the company alone that could initiate or defend proceedings and not a shareholder of the company. The court held that it appeared that there were disputes regarding the internal management of the applicant. Thus, the shareholders or counsel who had initiated the application were not authorised persons.

The application was dismissed and the rest of the arguments regarding extension of time to file the application were set aside without determination.

The applicants applied for an extension of time to give a notice of intention to appeal a judgment handed down in 2012. The applicants had previously applied for an extension in 2015, but this was struck out, giving rise to the following application.

The applicants contended that the previous application was not heard on merit, and as a result the court had jurisdiction to hear the matter.

The court found that the plain language of s 11 of the Appellate Jurisdiction Act confers a discretion on the court to grant an extension of time. The discretion must be judiciously exercised after taking into account the circumstances of the case, whether the applicant acted prudently and without delay. On perusing the court record, the court found that the applicants filed a notice of appeal within 30 days of the 2012 decision, but the appeal was struck out in December 2014. The time for filing another proper notice had expired. The court found that the applicants were concerned with their appeal in 2012 until it was struck out in 2014. The fact that the requisite time within which to issue a notice of appeal had expired while they were pursuing their appeal was reasonable and sufficient cause to grant an extension of time for giving notice of an appeal.

The application for extension of time was granted, and notice was to be filed within 14 days of the date of the ruling.

The matter involves an application for an extension of the period of appeal by applicant against a lower court decision. 

The main issue was whether the applicant, after consideration of the interests of justice and fair hearing, is entitled to an extension of the period of appeal. Starting from the point that the execution of a judgment does not foreclose the aggrieved party’s right of appeal, the court stated that the applicant must show good and substantial reasons for the delay in appeal, which can be rooted in a rule, lack of means, mistake or accident and, prima facie good cause why the application should be heard. Whilst the first leg requires a satisfactory justification, the second leg only requires one to show that the grounds of appeal are arguable. It is upon satisfaction of both the above that the court will use its discretion to grant the application.

As the applicant’s sole reason was that the delay stemmed from a desire to explore an out of court settlement option, the court followed the Supreme Court decision in Ikenta Best (Nig.) Ltd v AG Rivers State (2008) 2 SCNJ 152 to arrive at the position that the applicant’s reason could not be regarded as a good and substantial reason for delay in filing an appeal. The court thus held the applicant had failed to justify why the extension should be granted and therefore dismissed the application.

The respondent/plaintiff had sued the appellant/defendant for a liquidated debt following its default in payment and successfully applied for the matter to be placed on the undefended list. There it was heard exclusively on the papers to the respondent/plaintiff’s success. Two issues emerged on appeal: whether the trial court’s judgment contradicted the evidence, and whether the appellant’s notice of intention to defend disclosed a defence on the merits of the case, thereby justifying the matter’s transfer to the general cause list.

The appellate court held in favour of the respondents on both issues, finding first that the court had been thorough in its analysis of the evidence before it, and had crafted a reasoned order reflecting this.

The judge elucidated the purpose of the undefended list as a vehicle for swift justice where a defendant has no credible case. This was one such instance; the court found that the appellant had failed to raise a triable issue warranting the matter’s transfer to the general cause list. The appellant’s allegations of fraud did not conform to the recognised rules for establishing such a claim and were found lack any substance.

The appellant unsuccessfully invoked s 36(1) of the Constitution, contending that its right to a fair hearing had been breached through its being deprived of a comprehensive trial. The court affirmed the lawful function of the undefended list, emphasising that parties are given equal opportunities to be heard via the papers. Where a defendant was unable to raise a triable issue against the plaintiff’s claim, it could not resort to arguing that audi alterem partem had been flouted.

The appeal was dismissed.
 

The claimant/appellant purported to buy a property offered to it by the defendant/first respondent and consolidate the transaction with its purchase of another of the latter’s properties. This was proposed via counter-offer. The appellant proceeded to pay a down-payment for both properties after the agreed time-period, the bulk of which was unilaterally appropriated by the respondent towards payment for only one of them in reverting to the terms of the original agreement. Aggrieved, the appellant approached the High Court seeking layered relief to uphold the consolidated sale. The trial court found that, on the facts, the consolidation agreement was valid but conditional on the specified time-frame. It was therefore aborted as time was of the essence and payment had not been made in the required period. Judgment was entered in favour of the first respondent.

Challenging the trial court’s decision, the appellant argued that a binding agreement had been created, and the respondent had waived the issue of timeous payment when it accepted the appellant’s performance beyond the stipulated time-period. The court dismissed this claim, finding in concurrence with the court below that the failure to meet the time requirement – a term that was accepted by the appellant – thwarted the consolidation. No waiver had occurred.

Specific performance was unavailable to the appellant as the respondent had not breached their existing agreement. Its claim attacking the trial court’s jurisdiction to make an order regarding the transfer and registration of the property – directed at the second respondent – also failed.

The appeal was accordingly dismissed.
 

The main issue faced by the court in this matter was whether an appeal could be allowed to proceed when the notice of appeal is incompetent. 

On the assertion that the notice was defective for failure to reflect names and addresses of the parties, the court was quick to dismiss the objection as baseless as the error was a mere irregularity which could not affect the hearing of the appeal on merits. It reasoned that a liberal interpretation must be followed thus non-compliance per se could not be a ground for nullifying a proceeding unless it could amount to a denial of justice. Since the requirement of endorsement of names and addresses was a measure of convenience and not mandatory, it could not render the notice invalid. 

On the contention that the notice did not relate to any suit, the court acknowledged the presence of incongruities between record of appeal and the notice to an extent that there was no nexus between the two. Further, it observed the incompleteness of the record, defects which amounted to a failure in invoking the court’s jurisdiction. The court decried the applicant’s failure to remedy the above defects by way of motion on notice to the lower court, a defect it held to be fundamental and stems to the very root of the appeal process. The court thus held the appeal was effectively incompetent and therefore there was no jurisdiction to hear the appeal. 
 

The appellant averred that the trial court, without application by either party, dispensed with the mandatory requirements for pre-trial conference and ordered that the two pending applications be argued immediately. 

The issues were whether the provisions of Order 25 of the High Court of Lagos State (Civil Procedure) Rules 2004 provides for the mandatory holding of pre-trial conference and whether the ruling dispensing the pre-trial conference in the trial court was made in disregard of the civil procedure rules.

The court held that pre-trial conference is used to decipher interlocutory issues and trivialities of facts from the main trial of the case, when and if full trial is necessary for the final determination of the case. Pre-trial conferences may be mandatory however they do not apply where the pleadings have not yet closed or where by the wording of other rules of court it is inapplicable. The court went on to express that in the instant case, the pleadings had not yet closed and so the court below was right in holding that the summary judgment did not envisage any pre-trial conference. This because the summary judgment procedure instead is targeted at speedy disposal of the case where there is no defense or good defense to the claim. The court held that the respondent rushed to apply for pre-trial conference when the issue of whether or not there would be full trial was yet to be determined by the court. 

The appeal was dismissed.
 

The crux of the matter is whether or not the trial court erred in holding the appellant/defendant was given ample opportunities but failed, refused and/or neglected to defend the suit and present its case before the court. The appellant contended that the lower court’s refusal to re-open the case amounted to a violation of its right to fair hearing. The court held that the appellant had ample time to defend its case but failed.
    
The second issue was whether the exhibits admitted by the lower court were deserving of ascription of any probative value. The court held that documentary evidence can be admitted in the absence of the maker; what matters is admissibility. This means that a document can be admitted without the court attaching probative value to it. 

The court reiterated that where the lower court fails to examine documents tendered before it, an appellate court is in good position to evaluate such exhibits. The court thus held that the lower court erred when it held that the respondents were entitled to judgment.

In the result, the appeal succeeded even though the first issue was held in favor of the respondent.
 

The appellant challenged the jurisdiction of the court to entertain the petition of the respondent to wind up the appellant company for being unable to pay its debts.

The court held that jurisdiction is a threshold issue and where there is a condition precedent to the exercise of jurisdiction, and then unless fulfilled, the court shall be devoid of the requisite jurisdiction to determine the matter. The dispute, if any must be within the parameters of disputing a debt; that is in good faith and on substantial grounds. The court stated that the appellant was supposed to put forward facts which would satisfy the court that there was something which was ought to have been looked into on the same matter.

Disputation of a debt can bar the court from allowing a petition for winding up a company which has failed to pay its debt. A real dispute must touch on the substance of the debt in its material particulars such as showing part of the debt had been settled. The court held that the appellant failed to make any payments to the respondent. Furthermore, the respondent satisfied the requirements of the act and the jurisdiction of the court was properly activated and the issue is resolved against the appellant.

The appeal was dismissed as it lacked substance.