PARTIES IN FULL:
DEUTCHES HAUS NIGERIA LIMITED
CHIEF (ENGR) EYO NDEM EYOJIA
UNION HOMES SAVINGS AND LOANS PLC
CITATION:  2 NWLR PT.1759 AT 149.
Courtesy: Moruff O. Balogun Esq.
Summary of Facts:
The respondent filed a writ of summons against the appellants jointly and severally for the following reliefs:
(a) N128,000,000 as the total amount of concession granted to the appellants on their application for interest waiver on the outstanding balance of the loan and overdraft facilities that the respondent granted to the 1st appellant, and which was secured by the 2nd appellant, and which sum of money the appellants agreed to pay within 180 days, but did not pay despite repeated demands by the respondent.
(b) An order of sale of the 2nd appellant’s property situate at Plot 6, Government Residential Layout, Abasi Obori, Calabar, which was used as a security for the loan facilities granted to the appellants by the respondent.
(c) 21% pre-judgment interest and 10% post-judgment interest.
By a motion ex-parte filed on 2nd March 2018, the respondent applied that the writ of summons be issued against the appellants and entered for hearing under the undefended list. In support of the application, the respondent filed a 7 paragraphs affidavit sworn to by the respondent’s counsel
The trial court granted the application on 5th March 2018 and fixed 26th March 2018 as the return day.
Upon service of the court processes on the appellants, they filed a notice of intention to defend. The notice was supported by a 24 paragraph affidavit deposed to by the 1st appellant’s accountant, and to which was attached an exhibit (a photocopy of a forensic audit report of the appellant’s statement of account prepared by a chartered accountant). The deponent denied the grant of the concession of N128,000,000 asserted by the respondent. He denied the respondent’s claim. He asserted that the tenor of the loan was 120 months and that the expiry date of the loan was 15th June 2019.
After considering the appellants’ notice of intention to defend, the trial court ruled that the appellants had no defence on the merits.
So it entered judgment in favour of the respondent,the trial court, however, refused to grant the second relief sought by the respondent on the ground that it was not cognizable under the rules of court relating to the undefended list procedure.
Dissatisfied by the trial court’s decision, the appellants appealed to the Court of Appeal, in response, the respondent filed a reply brief and a respondent’s notice of intention by which it contended that the trial court’s judgment be affirmed on grounds other than those relied on by the trial court. Majorly, the respondent’s notice was based on the ground that the appellants affidavit in support of their notice of intention to defend the action did not comply with the mandatory provisions of section 115 of the Evidence Act, 2011.
In determining the appeal, the Court of Appeal considered:
Section 115(3) and (4) of the Evidence Act, 2011, which provide –
(3) When a person deposes to his belief in any matter of as fact and his belief is derived from any source other than his personal knowledge, he shall set forth explicitly the facts and circumstances forming the ground of his belief.
(4) When such belief is derived from information received from another person, the name of his informant shall be stated, and reasonable particulars shall be given respecting the informant and the time, place and circumstances of the information.
Order 10 rule 1 of the High Court of Cross River State (Civil Procedure) Rules, which provides-
“Whenever application is made to a court for the issue of a writ of summons in respect of a claim to recover a debt or liquidated money demand and such application is supported by an affidavit setting forth the grounds upon which the claim is based and stating that in the deponent’s belief there is no defence thereto, the court shall, if satisfied that there are good grounds for believing that there is no defence thereat enter the suit for hearing in what shall be called the ‘undefended list’ and mark the writ of summons accordingly and enter thereon a date for hearing suitable to the circumstances of the particular case.”
HELD: Unanimously allowing the appeal.
The Court of Appeal further stated: In view of my earlier findings that the respondent’s claim before the lower court are of mixed nature comprising also an order to sale the security for the facilities, the defect in the appellants’ affidavit alone is not a basis for the lower court to assume jurisdiction over the matter. Thus, the appeal succeeds on either ways and it is hereby allowed. The case is accordingly transferred to the general cause list for trial before another judge other than Honourable Justice Michael Edem.
The following issues were raised and determined by the Court of Appeal:
On whether claim for sale of property used as security for a loan is cognizable under undefended list procedure-
A claim for an order of sale of property used as security for a loan is not cognizable under Order 10 of the High Court of Cross River State (Civil Procedure) Rules 2008 relating to the undefended list procedure. In this case, by refusing to grant the second relief sought by the respondent, the trial court endorsed the appellants’ contention that the respondent’s claim was of hybrid or mixed nature, and that the trial court should not have assumed jurisdiction over it under the undefended list procedure.
On What defendant’s affidavit in support of notice of intention to defend must disclose-
In determining whether a defendant has a good defence to an action brought against him or he has disclosed such facts as may be deemed sufficient to defend the action under the undefended list procedure, it is not necessary for the trial court to consider whether the defence has been proved. All that the trial court is required to do is to simply look at the facts deposed to in the affidavit in support of the notice of intention to defend and see if they can prima facie afford a defence to the action. The defendant’s affidavit must, however, condescend upon particulars and should as far as possible, deal specifically with the plaintiff’s claim and affidavit and state clearly and concisely what the defence is and what documents are relied on to support it. Thus, the affidavit in support of the notice of intention to defend must of necessity disclose facts which will, at least, throw some doubts on the plaintiff’s case. Put differently, the affidavit in support of the notice of intention to defend the suit should contain enough facts and particulars to satisfy the trial court to remove the case from the undefended list. Where the affidavit to defend discloses no defence, the case should not be transferred to the general cause list.
In this case, the appellants’ denial of the claim and their assertion about the tenor and expiry date of the loan clearly threw some doubts on the interest waiver. In other words, the appellants’ affidavit disclosed a defence on merit. In the circumstance, the case should be transferred to the general cause list.
On Meaning of “liquidated demand”-
A liquidated demand is a debt or other specific sum of money usually payable and its amount must be already ascertained or capable of being ascertained as a mere matter of arithmetic without any further investigation. Therefore, when the amount a plaintiff is entitled to can be ascertained by calculation or fixed by any scale of charges or other positive data, it is said to be liquidated or made clear. In this case, the appellants’ claim for amount of concession granted to the appellants on their application for interest waiver is a claim having a specific nature. Further, the respondent’s claim for post-judgment interest can be classified as a claim for debt or liquidated money demand.
On Purpose of undefended list procedure-
The purpose of the undefended list procedure is for obtaining summary judgment without proceeding to trial requiring calling for witnesses. The procedure is therefore for disposing with dispatch cases which are uncontested. The procedure is to shorten the hearing of a suit where the claim is for liquidated sum.
On Facts that can be deposed to in affidavit-
An affidavit must contain only those facts of which the maker or deponent has personal knowledge of or which are based on information which he believes to be true. In the latter case he must also state the grounds of his belief and state the name and full particulars of his informant. In this case, the deponent to the affidavit in support of the notice of intention to defend is the Accountant of the 1st appellant and deposed to the said affidavit based on information given to him by his employers. But he did not state the grounds of his belief or the full particulars of his information particularly the time, place, and circumstances of the information, which contravenes the provisions of section 115(3) and (4) of the Evidence Act, 2011. In the circumstance, the averments in the said affidavit are therefore liable to be struck out. But because the respondent’s claim before the trial court are of mixed nature comprising also an order of sale of the security for the loan facilities, the defect in the appellants’ affidavit alone was not a basis for the trial court to assume jurisdiction over the matter.
Moruff O. Balogun Esq.
IJEBU ODE, OGUN STATE.