MOMAH (APPELLANT)
v.
VAB PETROLEUM INC (RESPONDENT)
(2000) All N.L.R. 695
Division: Supreme Court of Nigeria
Date of Judgment: 25 February 2000
Case Number: SC 183/1995
Before: Muhammadu Lawal Uwais, CJN; Abubakar Bashir Wali; Emmanuel Obioma Ogwuegbu; Aloysius Iyorgyer Katsina-Alu; Okechukwu Godfrey Achike, JJSC
ISSUE
What are the factors to be considered when an application for a Stay of Execution of a judgment is to be considered?
FACTS
The respondent had obtained judgment against the appellant in the High Court, London, England, in 1991. Some two years later the High Court, Lagos
State, granted the respondent leave to register the foreign judgment in accordance with the provisions of the Foreign Judgments (Reciprocal Enforcement) Act Cap. 152 Laws of the Federation of Nigeria 1990.
The appellant appealed to the Court of Appeal against this ruling. He also applied, by Notice on Motion, for the execution of the judgment to be stayed, pending the outcome of his appeal.
The Court of Appeal refused to grant the Stay of Execution, but ordered, that the respondent - which does not possess any assets in Nigeria - should pay the equivalent of the judgment debt (in excess of US$300,000) to the court's registrar, pending the outcome of the appeal yet to be heard and determined.
The appellant now appealed to the Supreme Court against the Court of Appeal's refusal to grant his application for a stay of the execution of the London judgment. The appeal before the Supreme Court, therefore, was not in respect of the trial court's decision to grant leave to have the foreign order registered (that appeal was still pending before the Court of Appeal) but it was specifically as an interlocutory appeal against the Court of Appeal's refusal to allow his application for a Stay of Execution.
The appellant contended that the Court of Appeal had erred in refusing the stay in that it had not exercised its discretion judiciously and judicially. He further argued that the Court of Appeal's order for payment of the judgment debt was inconsistent with the dismissing of the application for a stay and, that Section 4(3) of the Foreign Judgments (Reciprocal Enforcement) Act Cap. 152 required foreign currency to be converted to Naira before a foreign judgment could be registered, while the Court of Appeal had ordered the respondent to pay the money in US dollars.
In further support of his contentions, the appellant submitted that the balance of convenience favoured a stay as he (the appellant) held substantial assets in Nigeria while the respondent had none in this country. He also contended that the Court of Appeal had erred in its decision not to call for oral evidence in view of the conflicting nature of the facts deposed to under affidavit and filled in the court. The court was therefore wrong to accept the respondent's affidavit-evidence while discarding the appellant's version.
The respondent further averred that the appellant could and should have applied for a Stay of Execution of the judgment in the London court where he had ample opportunity of doing so. Accordingly no special or exceptional circumstances existed, for the court to allow a stay, thus depriving the respondent of the fruits of his judgment.
HELD
1. On hearing oral evidence where conflicting affidavits are before the court
The rule that oral evidence should be heard when the contesting parties submit conflicting affidavits does not extend to where one party delivers affidavits which are in themselves contradictory and thus unreliable. The applicant's submission that oral evidence should have been heard when it was his own set of affidavits that contained contradictory statements, was based on a misconception. Per Uwais, CJN, at page 701.
2. On the Court of Appeal's discretionary exercise in refusing a stay
It could not be said that the Court of Appeal had failed to exercise its discretion judiciously and judicially. It decided, correctly, that the balance of convenience weighed heavier in favour of the respondent and the contradictory and conflicting depositions in the appellant's affidavits, made the tilting of the scales in the opposite direction impossible. Per Uwais, CJN, at page 701.
3. On the Court of Appeal's jurisdiction to make a consequential order after refusing to grant a Stay of Execution
The Court of Appeal enjoys jurisdiction to make a consequential order under the circumstances of the present case by virtue of the provisions of Section 16 of the Court of Appeal Act Cap. 75. Because the inference could be drawn from the refusal to allow a stay that the respondent was entitled to enforce the judgment, the order to deposit the required money did not detract from the dismissal of the application to stay the judgment. This is tantamount to a conditional stay, for once the respondent had complied therewith, he would not, pending the outcome of the appeal, be able to execute the London judgment. Per Uwais, CJN, at page 701.
4. On payment to be made in a foreign currency
It was easy to determine the exchange rate applicable on the date of the foreign judgment and it was significant that the Court of Appeal had spoken of "a sum of money", without nominating the currency in which it had to be paid, when it made the consequential order for payment. Per Uwais, CJN, at page 701.
Chief C Chigbue, with him H Kareem, JD Moze, A Osuigwe and A Ohanele For the appellant.
MOS Amobi for the respondent.
The following cases were referred to in this judgment:
Nigeria
Ajomale v Yadu'at (No 2) (1991) 5 NWLR (Part 191)
Akinbobola v Plisson Fisko (1991) 1 NWLR (Part 167) 270
Akinsete v Akidutire (1966) All NLR 137
Deduwa v Okorodudu (1974) 6 SC 21
Falobi v Falobi (1976) 9 & 10 SC 1
Fawehinmi v Akilu (1990) 1 NWLR (Part 127) 450
First Bank v Doyin Investment (1989) 1 NWLR (Part 99) 634
Kigo ((Nigeria)) Ltd & others v Holman Bros ((Nigeria)) Ltd (1980) 5-7 SC 60
Metronex ((Nigeria)) Ltd v Griffin & George Ltd (1991) 1 NWLR (Part 169) 651
Nwabueze v Nwosu (1988) 4 NWLR (Part 88) 257
Obayagbona & another v Obazee (1972) 5 SC 247
Okafor & others v Nnaife (1987) 18 NSCC (Part 2) 1194
Okupe v F.B.I.R. (1974) NSCC 200
Olaogun Enterprises Ltd v S.J. & M (1992) 4 NWLR (Part 235) 361
Onagoruwa v Adeniji (1993) 5 NWLR (Part 293) 317
Saeckler v Tanimola (1995) 4 NWLR (Part 289) 370
The Registered Trustees of the Apostolic Church v Olowoleni (1990) 6 NWLR (Part 158) 514
U.B.N. Ltd v Odusote Bookstore Ltd (1994) 3 NWLR (Part 331) 129
Vaswani Trading Co v Savalakh (1972) 1 All NLR (Part 2) 483
Foreign
Anisminic v Foreign Compensation Commission (1969) 2 WLR 163
Schorsch Meir GMBH v Hennin [1975] 1 All ER 152
The following statutes were referred to in this judgment:
Nigeria
Court of Appeal Act Cap. 75 of the Laws of the Federation of Nigeria 1990: S 16
Foreign Judgments (Reciprocal Enforcement) Act Cap. 152 Laws of the Federation of Nigeria 1990: S 4(3)
The following decree was referred to in this judgment:
Court of Appeal Decree 1976: S 16
The following book was referred to in this judgment:
Concise Oxford Dictionary (5ed) at 258
Uwais, CJN (Delivered the Leading Judgment):- This is an interlocutory appeal from the decision of the Court of Appeal, Lagos Division. The appellant herein is judgment debtor to a judgment delivered by the High Court of Justice, Queen's Bench Division, (commercial court) London, United Kingdom, while the respondent herein is the judgment creditor to the said foreign judgment which was obtained in 1991.
In 1993, the judgment creditor brought a Notice on Motion in the High Court of Lagos State, holden at Lagos, seeking an order of that court to register the foreign judgment in question pursuant to the provisions of the Foreign Judgments (Reciprocal Enforcement) Act Cap. 152 Laws of the Federation of Nigeria 1990. The motion was contested by the judgment debtor but it was granted by Adeniji J, in a considered ruling.
Being dissatisfied with the ruling, the judgment debtor appealed to the Court of Appeal. He also filed a Notice on Motion in that court in which he inter alia prayed for:-
"1. An order staying execution of the order made in this suit on the 14 December 1993 by the Honourable Justice AB Adeniji of the High Court of Lagos sitting in Lagos wherein he ordered the registration of the foreign judgment of the High Court of Justice of the Queen's Bench Division of England pending the determination of the appeal filed in this Honourable Court."
After filing series of affidavits, counter-affidavits and replies to counter-affidavits, the motion was heard by the Court of Appeal and a considered ruling was delivered on 25 June 1995 by Pats-Acholonu, JCA (with whom Kalgo, JCA, as he then was, and Ibrahim Tanko Muhammad, JCA concurred). He dismissed the application in a somewhat lengthy ruling dealing in some respects with the substance and merit of the appeal which the Court of Appeal was yet to hear and determine. In my opinion, this is, with utmost respect, prejudicial, irregular and undesirable. Fortunately it is a different panel of the court below that will now hear the pending appeal. Be that as it may, the ruling was concluded thus:-
"In the circumstances the application fails. However, as the respondent (i.e.) VAB Petroleum Incorporated - the judgment creditor) has no asset in this country, the sum of money shall be deposited with the deputy chief registrar of this Court who will open account with UBA and which will yield high interest rate until the determination of the appeal."
The judgment debtor felt aggrieved by the ruling and the consequential order and, therefore, appealed to this Court filing seven grounds of appeal.
Appellant's and respondent's briefs of argument were filed and exchanged by parties. The issues formulated by the appellant for our determination are as follows:-
"2.1. Whether the Court of Appeal was right in refusing to grant a Stay of Execution?
2.2. Whether their Lordships of the Court of Appeal did or did not exercise their discretion judiciously and judicially on the materials before them in refusing the appellant's application for Stay of Execution of the ruling of the High Court?
2.3. Whether their Lordships of the Court of Appeal could in dismissing the appellant's application for stay of the High Court's ruling, also by the same ruling, make an order for payment of the judgment debt to the deputy chief registrar of the court below?
2.4. In view of the provisions of Section 4(3) of the Foreign Judgments (Reciprocal Enforcement) Act Cap. 152 requiring foreign currency to be converted to Naira before being registered by the High Court, was the court below right in ordering the appellant to pay the judgment debt of US$316,363.75 to the deputy chief registrar of the court below?"
The respondent's brief of argument contains three issues for our determination and they are:-
"(A) Whether a litigant who abandons his right of appeal against a judgment of a court of competent jurisdiction outside Nigeria, can seek to nullify the said judgment here in Nigeria without first doing so in the appropriate appellate court where the judgment was given.
(B) Whether in an application for a Stay of Execution, the Court of Appeal, faced with very clear evidence of mutual fears by both parties to the dispute for the safety of the judgment sum, can make appropriate order(s) pursuant to its inherent powers and also under Section 16 of the Court of Appeal Decree 1976, directing that the said judgment sum be paid into the registry of the court pending the determination of the appeal, after and quite independent of its ruling on the application before it.
(C) Whether in the circumstances of this appeal, the court below in dealing with proceedings for a Stay of Execution of judgment should not take into account, the conduct of the parties to the dispute as reflected in evidence before the court in considering whether to grant or dismiss the application for a stay."
In my opinion, Issue (A) is not based on any of the seven grounds of appeal filed by the appellant. I will have to therefore, discountenance it. On the other hand Issues (B) and (C) correspond with appellant's Issues Nos 2.1, 2.2 and 2.3. The later issues can conveniently accommodate the respondent's issues in determining the questions in this appeal. Consequently I intend to rely on the issues formulated by the appellant in determining the appeal.
Issue No 2.1
The appellant's argument is that the grounds of appeal raised substantial and arguable points of law. It is submitted that the Court of Appeal conceded this point when it held (per Pats-Acholonu, JCA) - "Merely having substantial grounds of appeal is not enough to sustain an application for a Stay of Execution or stay of proceedings, as the case may be." It is further argued that the balance of convenience in the case is in favour of the court below granting to the judgment debtor a Stay of Execution pending determination of the appeal. It was emphasised that this is so since the judgment creditor had no assets in Nigeria and the judgment debtor had deposed that he had real property in Nigeria. The cases of Fawehinmi v Akilu (1990) 1 NWLR (Part 127) 450 at 470 and Okafor v Nnaife (1987) 4 NWLR (Part 64) 129 at 136; were cited in support.
On the conflicting facts deposed to in the numerous affidavits filed by the parties, which the Court of Appeal alluded to in its ruling, the judgment debtor contends that the conflict was not resolved by calling oral evidence and the Court of Appeal was wrong in resolving the contradictions in the affidavits in favour of the respondent. The case of Onogoruwa v Adeniji (1993) 5 NWLR (Part 293) 317 was cited in support of the argument.
Respondent replied that the application for Stay of Execution should have been brought by the appellant in London, where the judgment in default of appearance was obtained, and not in Nigeria. The fact that the appellant had failed in 1991 to pay the judgment debt in full made the courts below refuse his application for Stay of Execution. Relying on the case of Nwabueze v Nwosu (1988) 4 NWLR (Part 88) 275, it is argued that there were no special or exceptional circumstances to make the courts below deprive the respondent of the fruits of his success in obtaining judgment against the appellant.
The respondent further contends that the discretion whether to grant or refuse Stay of Execution was exercised by the High Court and not the Court of Appeal. That the appellant's case in the latter court was an appeal against the refusal of the High Court to grant him stay. The Court of Appeal did not exercise any discretion to refuse the appellant stay but simply upheld the decision of the High Court since it was concerned with whether the High Court acted correctly in refusing the application for Stay of Execution. In conclusion, relying on the dictum of Karibi-Whyte, JSC in Ajomale v Yadu'at (No 2) (1991) 5 NWLR (Part 191) 266 at 294E-G, the respondent submitted that had the Court of Appeal granted stay to the appellant it would have acted erroneously since the res would have been in possession of the appellant who had been shown to be reckless in spending.
Now, let me first of all correct the misconception by the respondent that what was before the Court of Appeal was not an application for Stay of Execution but an appeal against the refusal by the High Court to grant stay. Nothing can be farther from the truth. The Notice on Motion for stay in the High Court was dated the 14 December 1993, while that which he brought before the Court of Appeal was dated the 5 May 1994, in paragraph 7 of the affidavit in support of the latter application it was deposed:-
"7 That on the same 4 May 1994 the High Court of Justice of Lagos (sic) refused and dismissed the application for Stay of Execution of its order pending the determination of appeal."
The next paragraph in the appellant's affidavit stated that a certified copy of the ruling was applied for but was not made available by the High Court. In its counter-affidavit, the respondent failed to allude to the depositions in paragraphs 7 and 8 of the appellant's affidavit.
The appeal pending before the Court of Appeal is against the ruling on the application by the respondent to the High Court for an order granting leave to have the foreign judgment registered. It was yet to be determined by the court below by the time the appellant's application for Stay of Execution was heard by the High Court.
I now return to the issue under consideration. The basic principle for grant of Stay of Execution has been laid down by this Court in a long line of authorities including the cases of Vaswani Trading Company v Savalakh (1972) 12 SC 77. Okafor & others v Nnaife (1987) 4 NWLR (Part 64) 129 and U.B.N. Ltd v Odusote Bookstore Ltd (1994) 3 NWLR (Part 331) 129. It is inter alia required that special or strong circumstances must exist before a stay could be granted. The essence of such stay is to maintain the status quo ante in order to ensure that the res, which is the subject matter of the appeal, is not destroyed to render the proceedings nugatory. In the present case, the court below examined the grounds of appeal filed by the appellant against the ruling of the learned trial Judge granting the application for leave to register the foreign judgment, and came to the conclusion that