Court name
Court of Appeal
Case number
L 591 of 2014

Tonique Oil Services Limited & Anor v United Bank For Africa PLC (L 591 of 2014) [2016] NGCA 135 (03 March 2016);

Law report citations
Media neutral citation
[2016] NGCA 135

IN THE COURT OF APPEAL OF NIGERIA

ON FRIDAY, THE 4TH DAY OF MARCH, 2016

CA/L/591/2014

BETWEEN

TONIQUE OIL SERVICES LIMITED

MR ANTHONY ADEJUGBE ...............................      Appellant(s)

AND

UNITED BANK FOR AFRICA PLC ........................... Respondent(s)

 

BEFORE THEIR LORDSHIPS

CHINWE EUGENIA IYIZOBA, J.C.A

YARGATA BYENCHIT NIMPAR, J.C.A

ABIMBOLA OSARUGUE OBASEKI-ADEJUMO, J.C.A

 

 

MAIN JUDGMENT

CHINWE EUGENIA IYIZOBA, J.C.A. :(Delivering the Leading Judgment): 

The Respondent as Claimant in the High Court Lagos on 24/4/14 filed a writ of summons and statement of claim in Suit LD/1O52/2013 against the Appellants jointly and severally for:

I)       The sum of N200,036,243.64 (Two Hundred Million, Thirty Six Thousand Two Hundred and Forty-three Naira Sixty four Kobo) being the amount owed the Claimant by the 1st Defendant on account of the loan/overdraft facility granted the 1st Defendant by the Claimant which facility was, guaranteed by the 2nd Defendant.

II)      interest on the amount claimed in "i" above of the rate of 22% per annum from June 2013 till judgment and thereafter at the same rate till liquidation of the judgment debt.

The Appellants who were defendants at the lower Court filed a statement of defence and counter-claim together with a Motion on Notice dated 17th day of February 20I4 for an order striking out the name of the 2nd Defendant and dismissing this suit against the 2nd Defendant for not disclosing any reasonable cause of action against the 2nd Defendant. The Respondent (the Claimant therein) filed a counter-affidavit in opposition to the Defendants (now Appellants) Application. In a considered ruling the Court dismissed the application and awarded cost of N50, 000.00 against the Appellants in favour of the Respondent. The Appellants dissatisfied with the ruling filed this interlocutory appeal. Briefs were filed and exchanged. The Appellants' brief was settled by Olayinka Onamade Esq., while the Respondent's brief was settled by Gloria A. Opeyokun (Mrs.). Out of the two grounds of appeal in the Notice of Appeal, the appellants formulated two issues as follows:

1.       Whether from the Statement of claim in this case, the 2nd defendant can be said to be o necessary party.

2.       Whether the lower Court was not wrong to hove referred to and looked at an affidavit and its exhibit to determine that a reasonable cause of action has been disclosed against defendant.

The Respondent in its brief formulated a sole issue to wit: whether the claimant/Respondent has a reasonable cause of action against the 2nd Defendant/ Appellant.

APPELLANTS' ARGUMENTS:

On issue one, whether from the Statement of Claim, the 2nd defendant can be said to be a necessary party Mrs. Opeyokun in her brief of argument submitted that it is trite law that to determine if a party is a necessary party to an action, the Court can only look at the state of the pleadings; that it is the averments contained in the Statement of Claim that will be considered in reaching the conclusion. He relied on the cases of BEBEJI OIL ALLIED PROD.LTD V. PANCOSTA LTD (2007) 36 WRN 163,195 (40-45), CHEVRON NIG. LTD V. LONESTAR DRILLING NIG LTD. (2007) 36 WRN 1 at 13 (30-40) 2007 NWLR (PT.1059)168 at 176-177 H-D; (SC). Learned counsel submitted that based on the pleadings i.e. the Statement of Claim and its accompanying Processes: the Defendant is not a necessary party to the action and that the dispute con be resolved in his absence.

On issue 2 whether the lower Court was not wrong to hove referred to and looked at on affidavit and its exhibit to determine that a reasonable cause of action has been disclosed against the 2nd defendant, counsel submitted relying on RINCO CONST. LTD V. VEEPEE IND. LTD (2005) 9 NWLR (PT.929) 85 and OMOLEYE (2004) 37 WRN 88 Ratio 3 that it has since been settled that to discover whether a reasonable cause of action has been disclosed against a Defendant ,recourse must only be had to the Statement of Claim. Counsel contended that looking at the pleadings include looking at the documents pleaded therein and other processes which by law are required to accompany the pleadings. She further submitted relying on UBN V UMEODURAGBA (2004) 13 NWLR (PT. 89) 352 that in determining the matter, the Court cannot look at any affidavit or its exhibit. Counsel argued that in the instant case, while paragraphs 2 and 8 of the Statement of Claim are to the effect that the 2nd Defendant is a personal guarantor of the facility, no written guarantee was front-loaded as part of the documents to be relied upon; and that counsel argued rendered the paragraphs impotent and unsubstantiated as Guarantees are required by law to be in written form. He cited BASSEY V. PAMOI NIG LTD (2011) AFWLR PT. 5O9 1443 Ratio 9. Counsel urged the Court to allow the appeal and to hold that no reasonable cause of action was disclosed against the 2nd Appellant.

RESPONDENTS ARGUMENTS :

Mr. Olayinka Onamade for the Respondent on his sole issue, whether the Claimant/Respondent has a reasonable cause of action against the 2nd Defendant/Appellant referred to some authorities where the phrase "reasonable cause of action" was defined and submitted that the Law is settled that in determining whether a cause of action or reasonable case of action exists in a case the Court has to look of and consider the facts as pleaded in the statement of claim. In other words, the only relevant document a Court needs to consider in the determination of whether a cause of action or a reasonable cause of action exists or is shown in a case, is the statement of claim which contains all the facts relied on by the Plaintiff in making a claim against a defendant and seeking judicial remedy from the Court.

Counsel submitted that from the definitions of a cause of action or reasonable cause of action; it con simply be said to be constituted by either a single fact or combination of facts averred by aýPlaintiff in his pleadings which the law will recognize as giving him a right to make a claim against a defendant for a remedy or relief in Court. The factual situation disclosed by the facts in the Plaintiffs' pleadings on which he relies to support the claim made must be recognized as giving him the right capable of being claimed against the Defendant. Every fact which it would be necessary for the Plaintiff to prove, if traversed in order to support his right to the judgment of the Court. Counsel further submitted relying on Shell Petroleum Development Company Nigeria Limited Vs. XM Federal Limited (2006) 16 NWLR (Pt.1004) 189 and Bello Vs. A.G. Oyo State (1980) 5 NWLR. 828 that in the determination of the existence of a cause of action, the Court is not concerned with whether or not the Plaintiff would succeed in proving his claim as that would only come for consideration when issues are joined and evidence adduced by the parties in proof of their Positions in a case. The Court is consequently not concerned with the success or failure of the plaintiff's claim at the stage of determining whether aýcause of action was disclosed by the facts averred in the statement of claim. Counsel submitted that the Respondent herein by virtue of the averments in Paragraphs 3, 8, 10, 11, and 17 of the Statement of Claim has disclosed a reasonable cause of action against the 2nd Appellant. Counsel submitted that on the face of the pleadings the Respondent had disclosed a reasonable cause of action against the 2nd Appellant. He further submitted that the fact that the lower Court mentioned Exhibit AA1 (2nd Appellant's personal guarantee) attached to Respondent's Counter affidavit should not lead to a reversal of the Ruling of the trial Court. He urged the Court to uphold the ruling of the lower Court and to dismiss the Appellants' interlocutory appeal with substantial costs.

RESOLUTION

In the Reply brief Mrs. opeyokun argued that the single issue formulated by the Respondent does not arise from and is not distilled from any of the Grounds of Appeal contained in the Notice of Appeal. In the motion that gave rise to this appeal at page 78 of the Record, the Appellant proved the Court to strike out the name of the 2nd Defendant and to dismiss the suit against him for not disclosing any reasonable cause of action against him. It was at the hearing of the motion that the Respondent raised the issue of necessary party. in his judgment at page 118 of the Record, the learned trial judge identified two issues for determination to wit:

1.       Whether the 2nd Defendant is a necessary party?

2.       whether there is a reasonable cause of action against the 2nd Defendant?

After considering the issues, the learned trial Judge dismissed the motion. In essence there is no difference between the two concepts. Ground 2 of the Notice of Appeal states that the trial Judge erred in law when she relied on an exhibit attached to a counter-affidavit to arrive at the finding that a cause of action has been disclosed. Particular 1 of the ground says that the learned trial judge looked beyond the statement of claim to arrive at the decision that the statement of claim disclosed a reasonable cause of action. This in effect means that instead of upholding the view that there is no reasonable cause of action by confining his consideration of the matter to the statement of claim, the learned trial judge considered and relied on an exhibit attached to the counter-affidavit of the Respondent in coming to the conclusion that there is no reasonable cause of action. In essence, the question for determination here is whether the learned trial judge was right in holding that the Plaintiff/Respondent is a necessary party in the suit and also whether the procedure he adopted in arriving at the decision that the Respondent has a reasonable cause of action against the 2nd Appellant is correct. Inherent in this latter question is the issue whether there is a reasonable cause of action. It is quite obvious then that the Respondent's sole issue arose from ground 2 of the Notice of Appeal. whether the Respondent herein has a reasonable cause of action against the 2nd Appellant and whether the 2nd Appellant is a necessary party to the suit are the issues determined by the lower Court which gave rise to this appeal. Those are the grounds of appeal. The Respondent's sole issue arose from ground 2 of the grounds of appeal..

In the case of Babayeju V. Ashamu (1998) 9 NWLP (Pt. 5671 546, Ogwuegbu JSC quoted a passage from Anon V. Raphael Tuck & Sons Ltd (1956) 1 Q.B.D. 357 at 380 which has become the litmus test for determining a necessary party to a suit:

"...............a necessary party is someone whose presence is necessary as a party. The only reason which makes it necessary to make a person a party to an action is that he should be bound by the result of the action, and the question to be settled therefore must be a question in the action which cannot be effectually and completely settled unless he is a party."

See also Peenok Investment Ltd v. Hotel Presidential Ltd (1982) 12 SC (Reprint) 1. In Oshoboja Vs. Amuda (1992) 6 NWLR (250) 690 @ 702 C-G cited by learned counsel for the Respondent, the Supreme Court defined a cause of action and reasonable cause of action thus:

"The words "cause