⦿ CASE SUMMARY OF:
Nika Fishing Co. Ltd. V. Lavina Corporation (2008) – SC
by PaulPipAr
⦿ TAG(S)
– Jurisdiction clause;
– Contract;
– Bill of lading;
– Stay of proceedings;
⦿ PARTIES
APPELLANT
Nika Fishing Co. Ltd.
v.
RESPONDENT
Lavina Corporation
⦿ CITATION
(2008) 16 NWLR (Pt.1114) 509;
(2008) 6-7 S.C. (Pt II) 200;
(2008) 6-7 S.C. (Pt II) 200;
(2008) LPELR-2035(SC);
⦿ COURT
Supreme Court
⦿ LEAD JUDGEMENT DELIVERED BY:
M. MOHAMMED, J.S.C
⦿ LAWYERS WHO ADVOCATED
* FOR THE APPELLANT
* FOR THE RESPONDENT
AAA
⦿ FACT (as relating to the issues)
This appeal is against the judgment of the Court of Appeal Lagos Division given on 21st June, 2001, in which it dismissed the Appellant’s appeal against the Ruling of the trial Federal High Court, Lagos of 28th June, 1989, dismissing the Appellant’s application for stay of proceedings in an action for damages on liability or demurrage incurred in a contract of carriage of goods by sea filed by the Respondent as Plaintiff against the Appellant as the Defendant.
The Respondent is the owner of the ship named MV Frio Caribic,’ hereinafter referred to as the ship.’ The ship was chartered to convey a consignment of frozen fish from Mar Del Plata in Argentina, to Apapa Lagos, Nigeria. The ship arrived at the Apapa port on 29th December, 1987 and discharged its cargo. Following the alleged delay in the Appellant taking delivery of the cargo within the time agreed by the parties in the Bill of Lading, the Respondent brought an action against the Appellant at the Federal High Court, Lagos on 21st December 1988, claiming the sum of $119,739.40 United States Dollars as demurrage.
Following the order of pleadings by the trial court, the Respondent as the Plaintiff filed its statement of claim to pave the way for the hearing of the case. On being served with the Statement of Claim, the Appellant as Defendant, instead of filing its statement of defence, reacted by filing a motion on notice dated 2nd May, 1989 supported by an affidavit, asking for two specific prayers, namely:
1. An order dismissing the suit for want of jurisdiction
2. An order staying proceedings in this suit.
The respondent did not file any counter affidavit to the Appellant’s motion which was duly heard by the trial court. In its Ruling on 28th June, 1989, the trial court refused the application. Part of this Ruling at page 31 of the record reads – “Having gone through all these authorities, I think justice is better served by refusing a stay than by granting one. Application is refused.”
Dissatisfied with this Ruling of the trial court, the Appellant, with the leave of the trial court, appealed to the Court of Appeal which in its decision delivered on 21st June, 2001, dismissed the appeal and affirmed the decision of the trial court.
It is from that decision of the Court of Appeal that the Appellant has now further appealed to this Court on three grounds of appeal from which two issues for determination were formulated in the Appellant’s brief of argument.
⦿ ISSUE(S)
Whether in all the circumstances of this case, the Court of Appeal was right in holding that the learned trial Judge exercised his discretion judicially and judiciously in refusing the Appellant’s application for stay of proceedings in the action brought against it by the Respondent inspite of the provision of a foreign jurisdiction clause contained in the agreement between the parties?
⦿ HOLDING & RATIO DECIDENDI
[APPEAL: ALLOWED, N50,000 COST AWARDED AGAINST THE RESPONDENT IN FAVOUR OF THE APPELLANT]
1. ISSUE 1 WAS RESOLVED IN FAVOUR OF THE APPELLANT BUT AGAINST THE RESPONDENT.
RATIO:
i. In the present case however, where the Respondent brought its action at the trial Court in clear breach of the agreement to refer any dispute to a foreign Court in Argentina and the Appellant had reacted by filing an application for stay of proceedings, as the Respondent’s suit was within the jurisdiction of that Court, the Court has a discretion whether or not to grant the application. The law requires such discretion to be exercised by granting a stay unless strong cause for not doing so is shown. The burden of showing such strong cause for not granting the application lies on the door steps of the Respondent as the plaintiff. The question is whether that burden had been discharged by the Respondent in finding that the burden had been discharged, this is what the trial court said at page 29 of the record: – “Having enumerated the statement of claim of the Plaintiff to see if this is a proper case to stay or assume jurisdiction taking Brandon Test into consideration, to me this is a simple contract guided by exhibit A. The goods were delivered in Nigeria. What the Plaintiff is claiming is only demurrage. In my view the witnesses to prove the case are all in Nigeria such as the Nigeria Ports Authority whose duty it is to know when the ship arrived and when it departed. I hold that it is in Nigeria Court that the issue of fact is situated or more readily available from the statement of claim of the plaintiff which is action on a simple contract, I hold that the Defendant does not genuinely desire trial in the foreign country but are only seeking a procedural advantage.” This finding of the trial court was not based on any evidence brought by the Respondent as plaintiff as no counter affidavit was filed by it in response to the application filed by the appellant supported by an affidavit. Further more, the Appellant’s affidavit in support of its application which the court below said could be relied upon by the Respondent in discharging the burden of proof of satisfying the trial court of its claim to hear the case in Nigeria rather than in Argentina, inspite of having failed to file a counter affidavit, does not contain such relevant facts relied upon by the trial court and the Court below to support the case of the Respondent. The fact that all the witnesses in the case are in Nigeria or that the circumstances of the matter show that the case is more connected with Nigeria than Argentina as found by the Courts below, are not at all contained in the Appellant’s affidavit in support of its application. This is where the circumstances of this case differ significantly from the case of Sonnar (Nig.) Ltd. v. Nordwind (supra), relied upon by both parties in which the Plaintiffs promptly reacted to the Defendants’ application for stay by filing a counter affidavit exhibiting documents showing why and how the Plaintiffs would be prejudiced if their suit were to be heard-in-Germany in accordance-with the agreement where the suit was already statute barred. The findings of fact made by the trial court in the present case that the witnesses to prove the Plaintiffs case are all in Nigeria and that the evidence on the issue of fact was situated or more readily available in Nigeria are not supported by evidence adduced by the plaintiff/respondent in discharge of the burden placed upon it by law. In this respect, the failure of the plaintiff/respondent to file a counter affidavit articulating or deposing to facts showing that inspite of the foreign venue agreed by the parties for the settlement of their dispute, it would be prejudiced if the trial court had not assumed jurisdiction to hear and determine the suit. Finding of facts cannot be made from paragraphs of the statement of claim filed by the Respondent as pleadings of which statements of claim are part, cannot take the place of evidence in a contested matter in Court.
ii. Jurisdiction is a very hard matter of law and so cannot be subjected to particular feelings and sentiments of the court. Where a contract specifically provides for the venue of litigation, courts are bound to give teeth to the contract by so construing it, without ado. In this case, issue of difficulty of assemblage of witnesses, cost of litigation arising from the parties going to Argentina, do not arise because they are mere expression of sentiment and at that.
⦿ REFERENCED
⦿ SOME PROVISIONS
⦿ RELEVANT CASES
TEST FOR APPLYING STAY OF PROCEEDING:
Eleftheria v. Eleftheria (1969) 1 Lyods LR 237 where Brandan, J said, as follows: “1. Where plaintiffs sue in England in breach of an agreement to refer disputes to a foreign court, and the defendants apply for a stay, the English court, assuming the claim to be otherwise within the jurisdiction, is not bound to grant a stay but has a discretion whether to do so or not. 2. The discretion should be exercised by granting a stay unless strong cause for not doing so is shown. 3. The burden of proving such strong cause is on the plaintiffs. 4. In exercising its discretion the court should take into account all the circumstances of the particular case. 5. In particular, but without prejudice to (4), the following matters, where they arise may be properly regarded: (a) In what country the evidence on the issues of fact is situated, or more readily available, and the effect of that on the relative convenience and expense of trial as between the English and foreign courts. (b) Whether the law of the foreign court applies and, if so, whether it differs from English law in any material respects. (c.) With what country either party is connected, and how closely. (d) Whether the defendants genuinely desire trial in the foreign country, or are only seeking procedural advantages. (e) Whether the plaintiffs would be prejudiced by having to sue in the foreign court because they would: i) be deprived of security for that claim ii) be unable to enforce any judgment iii) be faced with a time-bar not applicable in England; or (iv) for political, racial, religious or other reasons be unlikely to get a fair trial.”
AAAA
⦿ NOTABLE DICTA
* PROCEDURAL
When such an application or objection is raised before a trial court challenging its jurisdiction, the court could rely simply on the Writ of Summons, the Statement of Claim and affidavit in support of the applications as was rightly done by the trial court and affirmed by the court below in the present case. – M. MOHAMMED, J.S.C. Nika v. Lavina (2008)
In other words in the instant case where the Writ of Summons, the Plaintiffs/Respondent’s statement of claim and the affidavit filed by the Appellant as Defendant in support of its application, show quite clearly that the subject matter of suit being a liability for and entitlement of the Respondent to demurrage in a contract of carriage of goods by sea from Argentina to Lagos, Nigeria, by Section 7 of the Federal High Court Act is rightly within the Admiralty jurisdiction of the trial court as found by it and affirmed by the Court below. Infact having regard to the subject of the suit of the Respondent, it is only the Federal High Court that has jurisdiction to resolve the dispute between the parties in Nigeria. – M. MOHAMMED, J.S.C. Nika v. Lavina (2008)
This is because Courts of law can only decide issues in controversy between parties on the basis of the evidence before them … Finding of facts cannot be made from paragraphs of the statement of claim filed by the Respondent as pleadings of which statements of claim are part, cannot take the place of evidence in a contested matter in Court. – M. MOHAMMED, J.S.C. Nika v. Lavina (2008)
Stay of proceedings is a serious, grave and fundamental interruption in the right that a party has to conduct his litigation in the trial on the basis of the merits of his case, Consequently, the court’s general practice is that a stay of proceedings should not be imposed unless the proceedings beyond all reasonable doubt ought not to be allowed to continue. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
Accordingly, where the applicant has no valid cause or right of action, there is in law no basis for an application for stay of proceedings as there is nothing in law to stay. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
In order to consider an application for stay of proceedings, there should be a pending appeal and the pending appeal must be valid. For instance, where an appeal is filed out of time, it is incompetent and therefore invalid. A court of law will not consider an application for stay in respect of such an incompetent or invalid appeal. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
In order to grant an application for stay of proceedings, the pending appeal must be arguable and this should be borne out by the ground or grounds of appeal. In other words, the grounds of appeal must clearly donate the legal strength of the appeal but only in terms of it being arguable. An applicant has no duty to prove at that stage that the appeal will succeed. Once he shows that the appeal is arguable and there are chances of success, an’ application for stay could be granted. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
One important factor in an application for stay of proceedings is hardship. A court of law will be most reluctant to grant an application for stay of proceedings if it will cause greater hardship than if the application is refused. The question of hardship is a matter of fact which can be deduced from the competing affidavit evidence. The moment the court comes to the conclusion that the grant of the application will do more harm than good, it will be refused. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
The respondent did not file any counter affidavit. Accordingly, paragraphs 4 and 5 of the affidavit in support are deemed to have been admitted. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
The fact that the witnesses needed by the respondent to prove its case were all resident in Nigeria was manufactured’ by the trial court. The plaintiff never deposed to any such fact. The-court below fell into the same error when it adopted willy-nilly the reasoning of the trial court. It is my view that both courts below were wrong. – Oguntade, J.S.C. Nika v. Lavina (2008)
* SUBSTANTIVE
When construing documents in dispute between two parties, the proper course is to discover the intention or contemplation of the parties and not to import into the contract ideas not potent on the face of the document. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
In the construction of documents, the question is not what the parties to the document may have intended to do by entering into that document, but what is the meaning of the words used in the document. – Niki Tobi, J.S.C. Nika v. Lavina (2008)
