In The Supreme Court of Nigeria
On Friday, the 12th day of December 1986
S.C. 88/1985
Between
Margaret Chinyere Stitch ....... Appellant
And
Attorney-General of the Federation ....... Respondents
Board of Customs and Excise
Attorney General of Ogun State
O.O Onifade
(Joined by Order of Court)
Judgment of the Court
Delivered by
Anthony Nnamezie Aniagolu. J.S.C.
The central issue in this appeal concerns the exercise by a Minister of the Federal Government of Nigeria of his ministerial discretion - an exercise to which no reasons were attached - and whether the courts in order to do justice, can review that exercise of discretion the non-giving of reasons by the minister notwithstanding.
The case (aptly described in a letter dated 19th December, 1985 from the Office of the Chief of General Staff as "pathetic") from which this appeal emanated from the Court of Appeal, was begun on 23rd September, 1982 with a Writ of Summons, in the then Federal Revenue Court, in Suit FHC/L/102/1982 , issued by the appellant, Margaret Chinyere Stitch, against the Attorney-General of the Federation and the Board of Customs and Excise, The claim reads;
"The plaintiffs claim against the defendants is for:
"1. A declaration that the action of the Ministry of Commerce in suspending the issuing of import permits some three weeks before the passing of the Economic Stabilisation (Temporary Provisions) Act 1982 on the 20th of April 1982 was calculated to subject the plaintiff's car which had entered Nigeria on the 3rd of April 1982 to the Economic Stabilisation (Temporary Provisions) (Customs Duties) Order 1982 to which it would not have been subject at the time of importation if the import licence in respect thereof had been issued before the 19th of April 1982 in accordance with the established procedures of the Federal Ministry of Commerce.
2. A declaration that the plaintiff is only liable to pay customs duty in respect of the used Mercedes Benz Car Chassis No 123033-10-011229 the sum 6f N896.60 or such other sum based upon the rate of duty payable as at the 19th of April 1982.
3. An order for the release of the said car to the plaintiff on the payment of the said sum.
Issued at Lagos the 23RD day of September, 1982"
(Underlines are mine)
The facts of the case are largely not in dispute. The appellant, who is a legal practitioner, is married to a German national, and lives at Ubakiri Road, Mbieri, Owerri, Imo State, and while in Western Germany she bought a used 1976 Model Mercedes Benz 280 Saloon car which she shipped to Nigeria on 22nd February, 1982. Exhibit A is the "Shipping Order". The car arrived at the Lagos harbour on 3rd April, 1982 by the vessel "Warendorp". Exhibit B is the bill of lading while Exhibit c is the certificate of entry.
The appellant had Joki (Nig.) Ltd of Commercial Road, Apapa, as her shipping agent. While the shipping agent was dealing with the Customs, the appellant went over to the Ministry of Commerce to obtain the import licence the laid down conditions for which she already knew, and fulfilled, before that date. I shall return to this in due course.
At the Ministry she made her application for import licence which she said she expected to receive the same day or the next. That was not to be. Instead, she was told after submitting her application that there was "a directive" that no import licence was to be issued. She was naturally disturbed and went and complained to the Permanent Secretary who told her to return the next day. She returned only to be told by the Permanent Secretary that she should be regularly coming to the Ministry as they would then soon resume the issue of import licences. It is not in dispute that the issue of import licences was then suspended. It is to be noted that this was admitted in paragraph 6 of the statement of defence of the 1st respondent.
It was not until 29th April 1982 that import licence was issued to her. In the meantime, on 20th April 1982 the then Economic Stabilization (Temporary Provisions) (Customs Duties) Order 1982 was promulgated. This Order increased the rate of duty payable on the type of car the appellant imported, from 33l/3% to 500%
On the basis of 33 1/3 %, the duty which the Board of Customs assessed for the appellant to pay on 13th April 1982 was N 1,449.22. (See Exhibit E.) She presented a certified cheque for that amount which she presented to the Customs, but the Customs would not accept it until she produced the import licence After the import licence was issued to her on 29th April 1982, she represented the certified cheque with it but the Board of Customs told her she would have to pay, not the N I,449.22 as they originally assessed, but a sum, of N 14,500.00 on the basis of the 500% as introduced by the new Order of 1982. The appellant refused to pay this new amount arguing that the car had arrived in the country before the 20th April 1982 Order was made. The Customs thereupon accepted the certified cheque but stated that it was only accepted as part of the N14,500.00 duty. A receipt (Exhibit E was issued to the appellant for that amount regarded as part payment. The appellant swore that she came to the conclusion that the Federal Government (1st respondent) deliberately suspended the issue of import licence to her when she applied for it, in order that she should be caught by the new Order. She argued that the government had no power to do so and that the duty payable was the rate of duty applicable when the car arrived in Nigeria.
Not having paid the full 500% duty charged, the Board of Customs (2nd respondent) refused to release the car to the appellant. With this refusal, the appellant stepped into a quagmire of frustration the nature of which was laid bare in evidence before this court, both oral and by affidavit.
This was how the new evidence came about. On 16th June 1986, this appeal was called up for hearing by this court. Mr. Osaje, of counsel, appeared for the Attorney-General of the Federation and the Board of Customs (1st and 2nd respondents) while Mrs. Olopade, of counsel, appeared for the Ogun State Government. During the proceedings, Mr.Osaje, of counsel, revealed to this court that the Mercedes Benz car in dispute was no more available as it had been disposed of to the Ogun State Government by the Port Commandant of the Tin Can Island Port, Lagos, apparently on 23rd May 1985. Mrs. Olopade, counsel for the Ogun State Government, confirmed that the car was sold to the Ogun State Government but stated that the said government in turn sold the car to one Mr. 0.O. Onifade who was working under the Lagos University Teaching Hospital, on 24th June 1985.
Intent on seeing that justice was done in this case no matter how difficult and tedious the road to it may have become, this court issued an order for the appearance of Mr. O. O. Onifade with the vehicle in question. In addition, the court formally joined the Attorney-General of Ogun State representing the Ogun State Government and Mr. O. O. Onifade, as parties to the suit. Mr. Onifade, whose full names are Olayiwola Olaniyi Onifade, appeared but without the car. He pleaded that the car was not in good working condition and that he had left it in a mechanic's workshop from where he had been selling the parts of the car, piecemeal. He had cannibalized it.
On hearing this, the court immediately made an order that the Registrar of this court together with counsel and parties should go and view the vehicle and record its state together with all the parts of the car sold or missing. The order was carried out and the Acting Senior Registrar of this court, Mr. M. A. Toyin Keshinro, prepared a list of the parts of the vehicle found missing in Exhibit 6. These included the seats of the car both front and back; the head lamps; the four tyres; the four rims; the battery; the bumpers both front and back and the valve cover of the engine. The car was repainted with olive green colour, different from its original colour. Six photographs taken of the remnant of the car were put in evidence as Exhibits MCS 2 to 7.
The affidavit evidence sworn to by several individuals and the appellant made for heavy reading, to one's discomfort. These brought in, apart from the appellant and the 4th respondent, such other people as Mr. Lateef Ayinla Sowade, a Senior Executive Officer of the Protocol and Ceremonial Division of the Office of the Military Governor of Ogun State; Mr. O.A. Adesida, counsel attached to the Legal Division of the Department of Customs and Excise; Mr. Fela Sharafa of 49, Aina Street, ojota, Lagos, the Co-owner of the mechanical workshop at Plot 61, Imam Dauda Street Off Eric Moore Road, Surulere, where the vehicle was parked; Mr. Ganiyu Kazeem, a mechanical technician employed by Leventis Motors, Apapa, Lagos; and Abayomi Onifade, who is studying at the Federal Government College, Ijanikin, Lagos. The contest was all as to the mechanical state of the vehicle, whether or not it was deliberately being presented as being in a non-working order. As it turned out, the outcome of this appeal did not depend on the assertions in those conflicting affidavits.
After the evidence of the appellant before the trial judge and the closure of her case, the defence called two witnesses, namely, Nwaononian Enyinnaya Onyeike, a Principal Collector of Customs and Excise and Itekena Abel-Taria, a Senior Superintendent Collector of Customs attached to the Legal Section at Tin Can Island Port, Apapa. The former told the court that he was in charge of the vehicle release section at Tin Can Island Port and that in May 1982 the appellant complained to him that the Customs refused to release the car to her. On enquiry, he found from the particulars of the car given to him, that the appellant should pay 500% duty on the value of the car, instead of 331/3% which she had paid. On a question why she should pay500%, witness claimed that as from 20th April 1982 the rate of duty on the type of car she brought in was 500%. The latter testified to the same effect confirming that the appellant came to the Tin Can Island to clear her car but that the car was not released to her because of a Dispute as to the customs duty payable.
Evidence was taken by this court from Olayiwola Olaniyi Onifade the 4th respondent. He swore that he bought the Mercedes Benz from Ogun State Government on the 24th June 1985 for the sum of N 7,201.00. He had information that government was selling a number of seized cars. The price he paid was the price fixed by the Office of the Chief of Staff.
At the conclusion of the exercise this court felt that the best thing to do was to preserve the res until the determination of the appeal. Accordingly, it was ordered that the vehicle should be preserved in the state in which it was. No further sale of the parts of the car should be carried out by the 4th respondent until the determination of the appeal.
The High Court, in its judgment (Sowemimo, J.) found against the appellant holding that the duty on the vehicle must be the amount which according to the new law was payable on the day payment was tendered by the appellant. He held that this was in accordance with section 35 of the Customs and Excise Management Act, 1958. The Economic Stabilization (Temporary Provisions) (Customs Duties) Order 1982 having come into operation, he held the appellant was bound to pay duty at the new rate.
Appellant's appeal to the Court of Appeal was dismissed on the ground that it had no merit. The lead judgment delivered by Uthman Mohammed, J.C.A., was concurred to, by Ademola and Nnaemeka-Agu, J.C.A. In concluding his judgment Mohammed, J.C.A., held as follows;-
"I agree that the submission of Mr. Osaje, learned counsel for the respondent that the appellant has failed to prove that the Minister's refusal to issue the licence to her at the time she submitted her application was arbitrarily (sic) made. In the end I am quite satisfied that the trial court was right in dismissing the action because the appellant has failed to establish a right to be issued with an import licence at the time she applied for one."
It was from this judgment that the appellant has appealed to this court complaining of several misdirections and error in law. In sum, the grounds of appeal argued boil down to one issue, namely, whether the Ministry of Commerce had power to suspend the issue of import licence to the appellant and if so, whether the exercise by the Ministry of such a power to suspend was arbitrarily made, in all the circumstances.
The starting point of an appreciation of the issues involved in this appeal must be with the pleadings which were earlier ordered and filed. Particularly salient to the appellant's contention are paragraphs 5 to 18 of the statement of claim which read:
"5. Although importation of motor cars is subject to import licence issued by the Ministry of Commerce the Ministry has for several years operated a policy with regard to the conditions under which it would grant an import licence for the importation of motor cars by private individuals. These conditions are:
(i) That the car should actually have arrived in a Nigerian port.
(ii) That provision of foreign exchange by the Nigerian Government would not be required in connection with the purchase price of the car.
(iii) That the prospective importer of the car should have been abroad in foreign country from which the car was being imported.
6. The Ministry of Commerce has always issued import licences as a matter of course in respect of motor cars which have satisfied these conditions and the said Ministry is aware that Nigerians have arranged their affairs accordingly and that in reliance upon this policy Nigerians bring motor cars all the way from overseas to the Nigerian ports confident of being issued with an import licence when the aforesaid conditions are satisfied.
7. The plaintiff had complied with all the said conditions set forth in paragraph 5 herein and avers that she was therefore entitled to be issued with an import licence in respect of the said car.
8. The plaintiff submitted her application for an import licence for the said car on the 13th of April 1982 and expected the same to be issued as a matter of course.
9. The plaintiff was however informed by the staff of the Ministry that a directive had been issued to the effect that the issue of import licences be suspended until further notice.
10. The plaintiff avers that at the time when she submitted her application for the issue of an import licence in respect of the said car, the said car was subject to import duty of 33 1/3% under the provisions of the Finance Act 1962 which was then in force,
11. The import duty payable upon the car as given to the plaintiff by the officials of the 2nd defendant was N I, 449.22 and the plaintiff on the 13th of April 1982 wrote out a cheque for the said amount in favour of the 2nd defendant. The plaintiff on the same day paid the handling charges in respect of the importation of the car.
12. The 2nd defendant's servants did not however accept the cheque until May 1982 when they issued an official receipt therefor.
13. The plaintiff complained to the Permanent Secretary at the Ministry of Commerce who confirmed to her that it had always been the policy of the Ministry to issue import licences for the importation of private cars once the applicant had complied with all the conditions set forth in paragraph 5 herein.
14. The plaintiff continued to press for the issue of an import licence in respect of the said car, but it was not issued to her until the 29th of April 1982 after the making of the Economic Stabilisation (Temporary Provisions) (Customs Duties) Order 1982 on the 20th of April 1982.
15. Upon presenting the said import licence to the 2nd defendant, the 2nd defendant's officials asserted that under the provisions of the Economic Stabilisation (etc.) Order aforesaid, the plaintiff would now be required to pay duty at the rate of 500% on the said car, and that this would amount to some 814,500.00.
16. The plaintiff avers that the Federal Ministry of Commerce deliberately delayed the issue of the import licence to the plaintiff knowing fully well that new and heavier import duties were to be prescribed by the Economic Stabilisation (Temporary Provisions) (Customs Duties) Order 1981 (sic) which was then being prepared and with the intention that the plaintiff should not pay the existing customs duty in accordance with the existing legislation but so that the plaintiff might be made to pay duty at the much higher rate that was to be prescribed in the future by the said Order then in preparation,
17. The 2nd defendant thereafter detained the said car, and refused to release the same until the plaintiff had paid duty at the rate of 500% aforesaid, and threatened to sell the car to members of the public should the plaintiff fail to do so promptly.
I8. The plaintiff avers that having imported the said car into Nigeria on the 3rd of April 1982, she is entitled to pay duty on the same at the rate of 33 1/3% then in force, and having imported the said car on that basis and been prevented from obtaining an import licence due only to the arbitrary suspension in issuing the same, it would be unjust and retrospectively punitive to expect her to add an additional N 13,100.00 prescribed by a law which did not exist at the time she imported the car into Nigeria."
Be it noted and remembered that paragraph 5 sets out the conditions under which an import licence for the importation of a motor car by a private individual would be granted by the Minister of Commerce while paragraphs 6 and 7 averred that the appellant had satisfied those conditions.
The statement of defence, paragraph 4, of the Federal Government admitted paragraphs 5 and 6 of the statement of claim. In paragraph 5, the Federal Government averred that it was not in a position to admit or deny paragraph 7 of the statement of claim which alleged that the appellant had satisfied the conditions entitling her to be issued with an import licence. For easy reference, the statement of defence of the Federal Government (1st respondent) which is pretty short, is set out hereunder as follows:
"1. Save And Except as herein expressly admitted the 1st defendant denies each and every allegation of facts contained in the plaintiff's statement of claim as if the same were specifically set out and traversed seriatim.
2. The 1st defendant admits paragraph 2 of the statement of claim only to the extent that it is sued as representing the Government of the Federal Republic of Nigeria.
3. The 1st defendant denies paragraphs 3, 4, 7, 10, 11, 12, 16, 17, 18, 19.
4. With reference to paragraph. 5 & 6 of the statement of claim the 1st defendant admits the allegations therein.
5. The 1st defendant is not in the position to admit or deny paragraph 7of the plaintiff's statement of claim and puts the plaintiff to the strictest proof thereof.
6. With reference to paragraphs 8 & 9 of the statement of claim the 1st defendant avers that at the time the plaintiff submitted her application for an import licence on the 10/4/82 a directive had already been given by the Federal Government to suspend the issue of all import licences.
7. The 1st defendant is not in the position to admit or deny paragraph 13 of the statement of claim and puts the plaintiff to the strictest proof thereof.
8. The 1st defendant admits paragraph 14 of the statement of claim only to the extent that the plaintiff was issued with an import licence by the Ministry of Commerce on the 29th April, 1982.
9. The 1st defendant will contend at the trial that the plaintiff is not entitled to any declaration whatsoever.
10. The 1st defendant will rely on all other relevant documents, books, and extracts related to this suit.
11. The 1st defendant will contend at the trial that the plaintiff's action is speculative, frivolous, and an abuse of the court process."
The Board of Customs & Excise (the 2nd respondent) filed a blank denial of virtually everything the appellant had alleged in her statement of claim. Apart from paragraphs 2, 12, and 15, the 2nd respondent virtually denied everything including the obvious ones admitted by the Federal Government.
It was a pleading filed without regard to, or a reckless disregard of, the truth, unworthy of a government department which is mindful of the rights of the citizens of this country. This statement of defence of the Board of Customs & Excise reads:
1. Save And Except as herein expressly admitted the second defendant denies each and every allegation of facts contained in the plaintiff's statement of claim as if the same were specifically set out and traversed seriatim.
2. The second defendant admits paragraph 15 of the plaintiff's statement of claim.
3. The second defendant admits paragraph 12 of the statement of claim only to the extent that it did not accept the cheque but avers further that it did so because the plaintiff did not produce the import licence which is a prerequisite for acceptance of such cheque.
4. The second defendant denies paragraphs 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 17, 18, and 19 and puts the plaintiff to the strictest proof thereof.
5. The second defendant admits paragraph 2 of the statement of claim only to the extent that it is charged with the responsibility of regulating and enforcing the regulations relating to importation of goods into Nigeria.
6. The second defendant is not in a position to admit or deny paragraph 1 of the plaintiffs statement of claim.
7. In further denial of paragraph 11 of the plaintiffs statement of claim the second defendant will contend at the trial that the plaintiff was given an ex-factory price (i.e. The value of car) and not the duty payable on the car.
8. In further denial of paragraph11 of the plaintiffs statement of claim the second defendant will also contend at the trial that before any bill of entry is accepted for payment by the second defendant on imported cars the plaintiff is required to submit among other documents, import licence, which the plaintiff did not submit in this case on or before 13th April, 1982.
9. In further denial of paragraph 17 of the plaintiff's statement of claim the second defendant avers that it did not detain the plaintiff's car as there was no detention notice served on the plaintiff in respect of the car and that what was actually issued to the plaintiff was an underpayment notice.
10. In further denial of paragraph 18 of the plaintiff's statement of claim the second defendant avers that for the purpose of calculation customs duty payable on any imported goods under the Customs and Excise Management Act 1958 the rate of duty chargeable is that which is in force at the time of payment of duty.
11. The second defendant will contend at the trial that the plaintiff is not entitled to any declaration whatsoever.
12. The second defendant will also rely on all other relevant documents, books and extracts related to this suit.
13. The second defendant will also rely at the trial on all legal, equitable and statutory defences.
14. The second defendant will contend at the hearing that the plaintiff's action is speculative, frivolous and an abuse of court process."
The Board of Customs thus admitted
(a) Paragraph 2 of the statement of claim that the Attorney-General of the Federation represented the Federal Government (an innocuous fact prescribed by the Constitution of this country),-
(b) Paragraph 12, that the Board of Customs & Excise did not accept the appellant's cheque for the NI, 449.22 until May 1982 (a non-contentious fact); and
(c) Paragraph 15, that the appellant would have to pay N14,500.00 under the new Economic Stabilization Order of 1982 (plain, by the provisions of the new Order).
The attitude of the Board of Customs & Excise appears to be:
give her no quarter; deny everything.
This is neither justice nor noble, and is entirely to be deprecated.
The parties filed their briefs of argument. That of the appellant was, in synopsis, that the Federal Ministry of Commerce deliberately delayed the issue of the import licence to the appellant knowing fully well that new and heavier duties were to be prescribed by the Economic Stabilization, (Temporary Provision) (Customs Duties) Order 1982 which was then being prepared with the intention that the appellant should not pay the existing customs duty in accordance with the existing regulations, but that she might be made to pay duty at a much higher rate that was to be prescribed in the future by the said Order then in preparation. The appellant, the argument continued, had arranged her affairs and expended her resources and brought a car into the country, in a manner allowed by the Minister, and hereby qualified for an import licence. In bringing the car into the country she had calculated and expected that her liability for import duty would be 33 1/3% of the value of the car. The Minister, presumably knowing that legislation was being prepared to increase the import duty payable on cars with effect from 28th April 1982, deliberately refrained from performing his statutory duties so that the appellant would be subjected to the payment of duty at 500% which she was not liable to pay at the time she would have obtained her import licence in the ordinary course of business. The action of the Minister, she continued, was an abuse of power because he improperly suspended the performance of his duty with the ulterior and improper motive of making the appellant pay higher import duty to which she was not properly and lawfully subject.
Contrary to what the Court of Appeal held, she continued, the Minister had in fact issued her with a licence but after a deliberate delay in order to make her pay higher duty.
The 1st and 2nd respondents (the Federal Government and the Board of Customs & Excise) argued together, that the Minister exercised his power under section 3(2)(a) of the Finance Act 1981 in refusing to issue an import licence to the appellant. The period of delay from the date the appellant submitted her application to the date she was issued with a licence was within the power of a Minister under the section as there was no prescribed period when licences must be issued. The processing of applications in the Ministry of Commerce was, they continued, administrative and there was no evidence of any deliberate delay which affected the appellant alone. They further argued that the Minister's action could not be said to be arbitrary towards the appellant since all applications like that of the appellant, were treated in the same way. They concluded that since at the time the appellant presented her papers to the Board of Customs the Economic Stabilization Order had come into effect, the appellant should pay the duty prescribed by that Order.
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