SCOA Nigeria PLC and Another v Registered Trustees of Methodist Church of Nigeria and Another (A/L/1174/2010)[2016] NGCA 94 (22 March 2016) (A/L/1174/2010) [2016] NGCA 94 (21 March 2016);

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  • SCOA Nigeria PLC and Another v Registered Trustees of Methodist Church of Nigeria and Another (A/L/1174/2010)[2016] NGCA 94 (22 March 2016) (A/L/1174/2010) [2016] NGCA 94 (21 March 2016);

Headnote and Holding:

This was an appeal against a garnishee order granted by the court. The appellant contended that the garnishee proceedings were null and void because the first respondent did not disclose that the second respondent fell within the jurisdiction of the lower court. Further, the appellant argued that there was abuse of court process because the garnishee order was made after the appellant was granted leave to appeal.

The respondent argued that the appellant was not a party to the garnishee proceeding and cannot challenge the procedure.

In deciding the matter, the court held that the question of the judgement creditor establishing that the garnishee was within jurisdiction was not for the judgement debtor to determine but the court. It found that the appellants were not parties to the garnishee proceedings and that an appeal does not operate as a stay of execution. The appeal was thus dismissed.
 

 
 
In the Court of Appeal
Holden at Lagos

 

Between

Appellant

SCOA NIGERIA PLC
SCOATRAC

and

Respondent

1. THE REGISTERED TRUSTEES OF METHODIST CHURCH OF NIGERIA
2. ZENITH BANK PLC.

 

Judgement

(DELIVERED BY YARGATA BYENCHIT NIMPAR, JCA)
This is an appeal against the order of garnishee absolute made by HON. JUSTICE GBAJABIAMILA of the Lagos State High Court made on the 26th January, 2010. The 1st Respondent got a default judgement against the Appellants and filed necessary processes towards executing the judgement after the Appellants application to set aside the judgement was dismissed. The 1st Respondent then commenced garnishee proceedings with a view to enforcing the monetary judgement. While this was ongoing, the Appellants applied and were granted leave to appeal against the judgement entered against them. They also filed an application for stay of execution.  Garnishee order nisi and order absolute were made by the court attaching the account of the Appellants.  Another application to discharge the order of Garnishee absolute and to terminate further proceedings in the matter was refused by the lower court. Dissatisfied with the ruling, the Appellants filed a Notice of Appeal dated 20th May 2010 filed on the same day setting out 2 grounds of appeal.
    Briefs were filed and exchanged wherein the Appellants formulated 2 issues for determination as follows:
1.    Whether it was proper for the Honourable trial court to assume jurisdiction in the Garnishee proceedings when the originating processes did not disclose that the 2nd Respondent /Garnishee and/ or the debt owed by it to the 1st Appellant/ Judgement Debtor is/are within the jurisdiction of the court.
2. Whether,
a. The filing of the motion Ex – parte for Garnishee Order Nisi by the 1st Respondent/Judgement creditor during the pendency of the Appellants/judgement – Debtor’ application for leave to Appeal,
b.    The subsequent prosecution and granting of the said motion Ex-parte for Garnishee Nisi after leave had been granted to the Appellant/ judgement –Debtors to appeal and,
c.    The granting of the Garnishee order Absolute after the filing of an appeal and the application to stay the execution of the default judgement upon which the said Motion Ex – parte for Garnishee order Nisi and Garnishee Order Absolute were predicated do not amount to an abuse of court process, leading to a miscarriage of justice?
The Respondent on its part distilled a sole issue thus:
Whether the learned trial Judge was right in entertaining the Garnishee proceeding and making the Garnishee order Nisi and Garnishee order Absolute in favour of the 1st Respondent/Judgement – Creditor.
    The court shall adopt the issues formulated by the Appellants in order to give an exhaustive determination on the issues canvassed therein.

ISSUE ONE
Under this issue, Appellants counsel argued that the failure by the 1st Respondent to disclose in the originating process the fact that the 2nd Respondent (and or the debt owed by it to the 1st Appellant) is within the jurisdiction of the lower court is fatal to the entire garnishee proceeding and robs the court of the right to assume jurisdiction in the proceedings, referred to S. 83 (1) of the Sherriff and Civil Process Act, AROWOLO V ADEBANJI (1976) 11 SC 33. That flowing from this, the garnishee proceedings is null and void and of no effect. Appellant counsel further submitted that the 2nd Respondent is only required to show cause why he is not to pay the judgment debt and is not required to disclose the location of the judgment debt held for the 1st Appellant. The Appellant counsel further submitted that the submission of the 1st Respondent with respect to the garnishee and the judgment debt is at variance with the affidavit evidence presented before the lower court and should be disregarded, relied on CALABAR CENTRAL CO – OPERATIVE &ORS V BASSEY EBONG EKPO (2008) 2 SCNJ 307.
However, the 1stRespondent submitted that the Appellant not being a party to the garnishee proceeding has no vested right to challenge the procedure more so, that the procedure was carried out in accordance with the established procedure for garnishee proceedings.  Furthermore, that the 2nd Respondent against whom the order absolute was made, did not challenge the procedure adopted and relied on RE: DIAMOND BANK LTD (2002) 17 NWLR (PT 795) 120, PURIFICATION TECH (NIG) LTD V AG LAGOS STATE (2004) 9 NWLR (PT 879) 665.  They further submitted that the fact that the 1st Respondent did not state in its affidavit that the 2nd Respondent resides within the state does not rob the trial court of jurisdiction. According to the Respondents, there is nothing in S. 83(1) of the Sheriff and Civil Process Act which robs the court of jurisdiction to entertain same, but that the issue of jurisdiction is nothing but a ploy, relied on OJUKWU V ONYEABOR (1991) 7 NWLR (PT 203) 286, NATIONAL INSTITUTE FOR POLICY AND STRATEGIC STUDIES V FABIAN O OSIGWE (2008) 6 NWLR (PT 1083) 250, SOKOTO STATE V KAMDAX (NIG) LTD (2004) 9 NWLR (PT 878) 345.

RESOLUTION:
The first issue challenges the jurisdiction of the trial court in that the 1st Respondent did not disclose in its application that the debt owed it by the 1st Appellant is within the jurisdiction of the lower court thereby robbing the court of its jurisdiction.  Jurisdiction is generally a crucial and radical question. If a court lacks jurisdiction to determine a matter then all proceedings undertaken by the court becomes a nullity however well conducted. That makes jurisdiction a threshold matter. The apex court in the case of NDIC V CENTRAL BANK OF NIGERIA (2002) LPELR – 2000(SC) held thus:
“Jurisdiction is the very basis on which any tribunal tries a case; it is lifeline of all trials. A trial without jurisdiction is a nullity. The importance of jurisdiction is the reason why it can be raised at any stage of a case, be it at the trial, on appeal to Court of appeal or to this court; a fortiori the court can suo motu raise it.”
The law is settled on how to determine the jurisdiction of a court, a plethora of cases have re-established that jurisdiction has impact on competency of the court and is determined on the following principles:
1.     It is properly constituted with respect to the number and qualification of its members;
2. It has jurisdiction over the subject matter
3. The action is initiated by due process of law; and
4.    Any condition precedent to the exercise of its jurisdiction has been fulfilled.
Going by the argument of the Appellants, their challenge is founded on the fourth principle when they alleged that the lower court assumed jurisdiction when the 1st Respondent did not show that the Garnishee/2nd Respondent is within jurisdiction of the court. Appellants relied on section 83(1) of the Sheriff and Civil Process Act which states thus:
“The court may, upon the ex-parte application of any person who is entitled to the benefit of a judgment for the recovery or payment of money, either before or after any oral examination of the debtor liable under such judgement and upon affidavit by the applicant or his legal practitioner that judgement has been recovered and that it is still unsatisfied and to what amount, and any other person is indebted to such debtor and is within the state, order that debts owing from such third person, herein after called the garnishee, to such debtor shall be attached to satisfy the judgement or order, together with the costs of the garnishee proceedings and by the same or any subsequent order it may be ordered that the garnishee shall appear before the court to show cause why he should not pay to the person who has obtained such judgement or order the debt due from him to such debtor or so much thereof as may be sufficient to satisfy the judgement or order together with costs aforesaid.”
This provision was considered in the case of SOKOTO STATE V KAMDEX (NIG) LTD (2004) 9 NWLR Pt. 878 345 where the court held as follows:
“The long established principle in garnishee proceeding is that where the debt is situate determines the jurisdiction of the trial court; and it is a guide to garnishee proceeding leading eventually to the attachment of the credit balance of the third party.”

The aspect founding the complaint is that the application fororder of garnishee did not disclose that the 2nd Respondent was within the state.  The 1st Respondent countered the Appellants and contended that the Appellant had no role in the proceedings to warrant his objection.  The law has spelt out the procedure for garnishee proceedings in Sections 83 and 84 of the Sheriff and Civil Process Act.  The requirements stipulated in the Act are:
a. An applicant must satisfy that Judgement has been delivered;
b. An applicant must satisfy the court that the judgement is still unsatisfied;
c. An applicant must satisfy the court as to the amount of the still unsatisfied; and
d. An applicant must satisfy the court that a debt owes from the third party.
See UBA V SGB LTD (1996) 10 NWLR PT 478 381
See also CBN V AUTO IMPORT EXPORT(2013) 2 NWLR (PT 1337) 80 wherein a variant of the conditions to a valid garnishee proceedings were given as follows:
“For a garnishee proceeding to be valid, it is in incumbent upon the trial court to ensure that the following conditions have been duly satisfied:-
i.     That the garnishee must be indebted to the judgement creditor within the state and be resident in the state in which the proceedings are to be brought. As such, if the debt is owed by someone outside the state, the proceeding are inapplicable.
ii.     The proceedings should be filed in any court in which the judgement debtor could, under the High Court (Civil Procedure) Rules or under the appropriate section or rule governing civil procedure in Magistrates courts, as the case may be, sue the garnishee in respect of the debt. Thus, the court may not necessarily have to be the one that gave the judgment. It could be a Magistrate’s court and the fact that the debt exceeds the jurisdiction thereof notwithstanding.
iii.    The application for the garnishee order shall be made ex – parte. The court if satisfied that the judgement creditor is entitled to attach the debt, shall make a garnishee order nisi. See order 8 Rule 3(2).
iv.    The service of the order nisi thereon binds or attaches the debt in the hands of the garnishee. Section 85 of the Sheriff and Civil Process Act (supra). See the case of NATIONAL INSURANCE COMMISSION V OYEFESO &ORS (2013) LPELR – 20660 (CA).
The statutory provision of Section 83 of the Sheriff and Civil Process Act is clear and straight forward. The requirement is for the court to be satisfied that the debt is within the jurisdiction of the court. Besides, the Appellants never brought facts before the court to show that the 2nd Respondent was out of jurisdiction. It is not open to any other person to be so satisfied and if any party has a right of challenge, it is the garnishee not the judgement debtor who only gets to know when he is served with the order nisi.  As observed by the 1st Respondent, the Appellants are required to be served with the order Nisi and not with the motion which is ex – parte. It is the duty of the court to require any material before making the garnishee order nisi. It is after the making of the order Nisi that the law requires that the judgment debtor be served and even at that he has no part in the proceedings.  It has been settled that garnishee proceedings are distinct from the proceedings leading to the judgment debt, see STAR DEEPWATER PETROLEUM LIMITED & ORS V A.I.C LIMITED &ORS (2010) LPELR – 9165 (CA) where the court held as follows:
“It is trite law, that garnishee proceedings though incidental to the judgement pronouncing the debt owed, the judgement debtor is not a necessary party to the said proceedings.”See also P.P.M.C V DELPHI PETROLEUM INCORPORATED (2005) 1 NWLR (PT. 928) 458 at 486 and IN RE: DIAMOND BANK LTD (2002) 17 NWLR (Pt. 795) 120 at 133.
Taking the two authorities cited above together therefore suggest strongly that, though not a necessary party, the judgement debtor is only served with the order Nisi being a requirement of the law. The question of the judgement creditor establishing that the Garnishee is within jurisdiction is not for the judgement debtor to determine but the court. The motion that brings in the order Nisi is ex – parte. In any case, the parties were served within the jurisdiction of the court as no application for leave to serve the 2nd Respondent out of jurisdiction is in the record of appeal.  The Appellants can only appeal against the process that gave rise to the order Nisi as an interested party.  In this case the Garnishee who should have challenged the ruling of the court did not do so.  The right of appeal inures to the Garnishee not the Appellants. It is the product of a proceedings to which the Appellants are not a party and it is therefore not in the place of the Appellants to raise the issue of the garnishee/2nd Respondent being within the jurisdiction of the court. Issue one is resolved against the Appellants.

ISSUE TWO
The Appellants counsel here was of the opinion that the filing, prosecution and granting of the garnishee order nisi and absolute after the grant of their application for leave to appeal, filing of their notice of appeal and application for stay of execution of the default judgment, is an abuse of court process, citing the following cases CHRISTIAN OUTREACH MINISTIRES INC V COBHAM (2006) 16 NWLR (PT 1002) 283, CHIEF VICTOR UMEH & ANOR V PROFESSOR MAURICE IWU (2008) 2 SCNJ 272.Appellants counsel submitted that the implication of this is that the proceedings instituted by the Appellants challenging the default judgment was doomed to failure and consequently urged this court to set aside the garnishee order nisi and absolute granted by the lower court, ALHAJI UMARU MUSA YAR’ADUA V ALHAJI ATIKU ABUBAKAR (2008) 12 SCNJ 381, STANDARD TRUST BANK LTD V CONTRACT RESOURCES NIG LTD (NO 1) (2001) FWLR PT 72, 1922 @1924.
On the other hand, 1st Respondent’s counsel argued that there is a distinction between execution of a judgment by a writ of execution and garnishee proceedings and that the lower court was not bound to be stalled in proceeding with the garnishee proceeding because of the Appellants’ stay of execution, more so, the Appellants’ not being parties to the garnishee proceeding, relied on PURIFICATION TECH (NIG) LTD V AG LAGOS STATE (SUPRA).  In addition to this, the Respondents submitted that mere filing of a notice to appeal or leave to appeal without more, is insufficient to grant a stay of execution. That the trial judge rightly exercised his discretion in granting the garnishee order nisi and absolute and this discretion ought not to be interfered with by this court, citing ENEBEKE V ENEBEKE (1964) 1 ALL NLR 102, USHAE V COP (2005) 2 NWLR (PT 499) PG.528 – 529.
In their reply brief, the Appellants submitted that the case of PURIFICATION TECH (NIG) LTD V AG LAGOS STATE (SUPRA) relied on by the Respondents has been overturned by the decisions in the case of WAEC V MRS NKOYO EDET IKANG (2011) LPELR 5098 CA and that based on this decision the granting of an order nisi or absolute is wrong when an application for stay of execution is in existence as it would be overreaching the judgment debtor. That where there are two or more conflicting decisions, it is the latter in time that prevails, cited SERIKI V SOLAM (1965) 1 NMLR 1, IKEAKWU V NWAMKPA (1967) NMLR 224 and urged this court to uphold their appeal.

RESOLUTION:
This issue is divided into 3 sub-issues. The first one concerns the filing, prosecution and grant of the motion for Garnishee order Nisi and absolute during the pendency of the motion seeking leave to appeal and that it was an abuse of the court process. Abuse of court process has received judicial attention in a plethora of cases, one of which is SARAKI V KOTOYE (1992) LPELR – 3016(SC) where the apex court said:
“Thus the multiplicity of actions on the same subject matter between the same parties even where there exist a right to bring the action is regarded as abuse. The abuse lies in the multiplicity and the manner of the exercise of the right, rather than the exercise of the right, per se.  The abuse consists in the intension purpose, and aim of the person exercising the right to harass, irritate and annoy the adversary and interfere with the administration of justice; such as instituting different actions between the same parties simultaneously in different courts, even though on different grounds.”
There are therefore basic ingredients that must be present for abuse of court process to be said to have occurred.  These are:
a. The actions must be between same parties;
b. On the same subject matter;
c. On the same issues.
From the record before the court and arising from the resolution of issue one, the Appellants are not necessary parties to the garnishee proceedings. That clearly sets them apart in respect of the garnishee proceedings. Furthermore on parties, the 2nd Respondent was not a party to the judgement entered against the Appellants. It is very obvious therefore that on parties alone this arm of issue two must fail. There cannot be abuse of court process where parties are different in the actions. Another aspect is that there is only one suit wherein judgement was entered, the other application by the judgement creditor is in pursuance of executing the judgement. A Garnishee proceedings has been defined as:
“It behooves a successful plaintiff who does not want to lose the fruits of his victory to move fast against the assets of the judgment debtor to realize the fruits. One of such methods is to obtain the order of court to attach any debt owing to the judgment debtor from any person or body within the jurisdiction of the court to satisfy the judgment debt. That process is known as "attachment of debt". And it is a separate and distinct action between the plaintiff/judgment creditor and the person or body holding in custody the assets of the judgment debt, although it flows from the judgment that pronounces the debt owing.” See

RE: DIAMOND BANK LTD. (2002) 17 NWLR (PT.795) 120 @ 133.
A Garnishee proceedings is therefore not the kind of action that can qualify to be adjudged for abuse of court process. In any case, it is a process for execution of judgement debt.  I do not see how taking such a step can amount to abuse of court process. On this sub –issue, the Appellants failed to establish abuse of court process.

     The second leg of the second issue is that the subsequent prosecution and granting of the said motion ex – parte for garnishee order Nisi after leave had been granted to the Appellants/ judgement – debtors to appeal amounts to abuse of court process. The Appellants relied heavily on the case of STANDARD TRUST BANK V CONTRACT RESOURCES NIGERIA LTD (NO.1) (2001) Pt. 72 FWLR 1922 at 1924 – 1926 to contend that the 1st Respondent and the lower court should not have moved the motion and the court was wrong to grant the orders in view of the leave granted to the Appellants to appeal. It is trite that an appeal does not serve as a stay of execution of a judgement. See JOSIAH CORNELIUS LTD V EZENWA (1996) 4 NWLR (Pt. 443) 391 wherein the apex court held thus:
“the law is clear, that is, that an appeal does not operate as a stay of execution or of execution or of proceeding. Any party appealing against the interlocutory decision of a court is under a duty to apply for stay of further proceedings pending appeal if he believes the result of his appeal will affect further proceedings in the matter.”

If therefore the mere granting of leave to appeal but without the appeal itself entered does not amount to stay can the determination of a motion for Garnishee orders amount to abuse of court process?  The court in the case of DENTON – WEST V MUOMA (2008)6 NWLR (Pt. 1083); 2007 LPELR 8172 (CA) said that the garnishee proceedings are legitimate exercise of judgment creditors right to employ ancilliary methods to enforce the judgement obtained in his favour. That they are therefore competent notwithstanding the pendency of a motion for stay of execution, see also VASVANI TRADING CO. LTD V SAVALAKH & (1972) 12 SC 77 AND PURIFICATION TECHNIQUES (NIG) LTD V A. G. LAGOS STATE 92004) 9 NWLR Pt. 879 665 at 677.  It is also the opinion of this court in the case UNITED BANK FOR AFRICA V EKANEM(2009) LPELR – 8428 (CA) that though an appeal does not ipso factor operate as a stay of execution of the decision appealed against, it is however, desirable for both parties and the trial court to ensure that a situation of no fiat accompli is not foisted on the appellate court, see also STANDARD TRUST BANK V CONTRACT RESOURCES NIGRIA (SUPRA).  Can the situation at hand be classified as abuse of court process? I do not think so. What this court in the different judgments emphasized is the desirability of maintaining status quo so that a position of complete helplessness is not thrust upon the appellate court. It is also out of respect for the court in the exercise of its powers of review.  Furthermore, there was no appeal yet in this case when the orders of Garnishee Nisi and absolute were made by the trial court.  It is clear on the record that when the Appellants finally asked for a stay of execution, the same court granted same and thereafter the Garnishee proceedings were stayed.  The Appellant is wrong to expect that by a mere order for leave to appeal, the judgement creditor will automatically stay action thereby halting the judgement creditor’s right to materialize his judgement.  I find that it did not amount to abuse of court process for the lower court to consider and grant Garnishee orders when leave to appeal had just been granted to the judgment debtor. This leg of issue two also fails and is resolved against the Appellant.

The third leg of this issue states that the granting of the garnishee order absolute after the filing of an appeal and the application to stay the execution of the judgement upon which the garnishee order was made amounts to abuse of court process.  This leg is similar in all respect to the second leg.  Decisions in several authorities frowned at such attitude of the lower court but did not get to classifying it as abuse of court process. The fact is that the 1st Respondent has every right to seek to realize the fruit of its judgement.  Foisting a fiat accompli situation on the appellate court is not one of the elements of abuse of court process.  It is only decent and proper to await the decision of an appellate court out of respect and in the interest of justice.  The hands of the appellate court should not be arm twisted into a position of helplessness.  That is obviously different from abuse of court process as is known in our legal system. There is no need to repeat my findings above.  I therefore find that issue 3 is not made out and is hereby resolved in favour of the Respondents.
Consequently, the appeal fails and is dismissed.  The order of garnishee absolute made by HON. JUSTICE GBAJABIAMILA of the Lagos State High Court made on the 26th January, 2010 is hereby affirmed.
I make no order as to costs.

AMINA A. AUGIE. JCA:   I have read in draft the lead Judgment just delivered by my learned brother, Nimpar, JCA, and I agree with his reasoning and conclusion. Garnishee proceedings have been described as that process known as "attachment of debt". And it is a separate and distinct action between the Plaintiff/Judgment creditor and the person or body holding in custody the assets of the Judgment-Debt, although it flows from the Judgment that pronounces the debt owing - see Re: Diamond Bank Limited (2002) 17NWLR (Pt. 759) 120 [per Aderemi, JCA (as he then was)]
In this case, it is clear from all that my learned brother had to say in the lead Judgment that the order of garnishee absolute made by the lower Court was absolutely in order. I adopt the said reasoning as mine. In the circumstances, I also dismiss the Appeal, and abide by the consequential Orders in the lead Judgment including no order on costs.
 

JAMILU YAMMAMA TUKUR JCA:    I read before today the lead judgment just delivered by my learned brother YAR&ATA BYENCHIT NIMPAR JCA and I agree that the Appeal be dismissed.
I also dismiss the Appeal and abide by the consequential orders made therein.

Counsel

BALOGUN – APPELLANT
I. A. UGUNDU (MISS) - RESPONDENT