Enforcement of Monetary
Judgment vide Garnishee Proceedings against State entities especially monies
considered to be in custody of a Public Officer has been a mirage leaving Judgment
Creditors in helpless situation after the rigours of obtaining judgment usually
through a feisty contested and protracted litigation.
Judgment vide Garnishee Proceedings against State entities especially monies
considered to be in custody of a Public Officer has been a mirage leaving Judgment
Creditors in helpless situation after the rigours of obtaining judgment usually
through a feisty contested and protracted litigation.
Section 84(1) of the SCPA
Cap S6 2004 has indeed posed a clog in the wheel of Enforcing Money Judgments
against the government or its agencies. The Section Provides thus:
Cap S6 2004 has indeed posed a clog in the wheel of Enforcing Money Judgments
against the government or its agencies. The Section Provides thus:
“Where money liable to be
attached by garnishee proceedings is in the custody or under the control of a
public officer in his capacity or in custodial legis, the order nisi shall not
be made under the provisions of the last preceding section unless consent to
such attachment is first obtained from the appropriate officer in the case
of money in the custody or control of a public officer or of the court
in the case of money in custodial legis, as the case may be “ .
attached by garnishee proceedings is in the custody or under the control of a
public officer in his capacity or in custodial legis, the order nisi shall not
be made under the provisions of the last preceding section unless consent to
such attachment is first obtained from the appropriate officer in the case
of money in the custody or control of a public officer or of the court
in the case of money in custodial legis, as the case may be “ .
The appropriate officer
under this context is the Attorney General of the Federation or that of the
State as the case may be. This provision has been described as a pre-condition,
which must first be fulfilled before the Order Nisi, that is sought ex parte is
acceded to. There have been divergent views as well as conflicting decisions of
the Court of Appeal on the constitutionality or otherwise of this Section which
tends to deprive Judgment creditors from reaping the fruit of their judgment.
under this context is the Attorney General of the Federation or that of the
State as the case may be. This provision has been described as a pre-condition,
which must first be fulfilled before the Order Nisi, that is sought ex parte is
acceded to. There have been divergent views as well as conflicting decisions of
the Court of Appeal on the constitutionality or otherwise of this Section which
tends to deprive Judgment creditors from reaping the fruit of their judgment.
This article attempts to
briefly analyse the applicability of this provision vis-à-vis the recent
decision of the Nigeria Supreme Court in CBN v INTERSTELLA COMMUNICATIONS
LTD (2017) SC/500/2014 delivered on the 15th of December, 2017.
briefly analyse the applicability of this provision vis-à-vis the recent
decision of the Nigeria Supreme Court in CBN v INTERSTELLA COMMUNICATIONS
LTD (2017) SC/500/2014 delivered on the 15th of December, 2017.
HISTORICAL BACKGROUND
The pre-condition provided
under Section 84 of the SCPA has a common law root. The General Common
law position in order to protect the state, used to be that “ the King does
no wrong” which is expressed in the latin maxim, “Rex non protest
pecarre”. The trend in that inherent principle was that no country allowed
execution of judgments against the state. It was also the law then under that
principle that the state could not be sued in tort. Courts were then regarded
as the King’s Court. Naturally, judgment obtained by an individual could not be
enforced against the King. Clearly the crown enjoyed immunity from legal
actions and could not be impleaded in its own court for tortious acts by its
servants. In 1958, the said principle was trans-located into Nigeria by virtue
of Section 45(1) of the Interpretation Act, Cap 89, LFN 1958. The principle was
still the law in Nigeria even though it had been abolished in England by the
promulgation of the Crown Proceedings Act, 1947. The principle of State
immunity from tortious liability was codified to be part of Nigeria law by
virtue of the Petition of rights Act, Cap 149 as amended in 1964. This
explains how the common law principle prevailed. The idea is that
in a bid to protect the state, individuals cannot enforce judgment against the
King in his own court without the consent of the Attorney General. This trend
persisted up till 1979 when the 1979 Constitution came into effect. All the
cases before 1979 affirmed that any decisions of the High Court against the
State couldn’t be enforced without the consent of the Attorney General. In this
current constitutional dispensation, the provision of the Petition of Right Act
to the extent that it purports to prevent an aggrieved party from taking direct
action in court against the State is in riot conflict with Section 6(6)(b) of
the Constitution to the extent of its inconsistency null and void. Therefore
garnishee proceedings can be instituted against the government. See
RANSOME-KUTIv. AGF (1985) 2 NWLR (Pt 6) 211.
under Section 84 of the SCPA has a common law root. The General Common
law position in order to protect the state, used to be that “ the King does
no wrong” which is expressed in the latin maxim, “Rex non protest
pecarre”. The trend in that inherent principle was that no country allowed
execution of judgments against the state. It was also the law then under that
principle that the state could not be sued in tort. Courts were then regarded
as the King’s Court. Naturally, judgment obtained by an individual could not be
enforced against the King. Clearly the crown enjoyed immunity from legal
actions and could not be impleaded in its own court for tortious acts by its
servants. In 1958, the said principle was trans-located into Nigeria by virtue
of Section 45(1) of the Interpretation Act, Cap 89, LFN 1958. The principle was
still the law in Nigeria even though it had been abolished in England by the
promulgation of the Crown Proceedings Act, 1947. The principle of State
immunity from tortious liability was codified to be part of Nigeria law by
virtue of the Petition of rights Act, Cap 149 as amended in 1964. This
explains how the common law principle prevailed. The idea is that
in a bid to protect the state, individuals cannot enforce judgment against the
King in his own court without the consent of the Attorney General. This trend
persisted up till 1979 when the 1979 Constitution came into effect. All the
cases before 1979 affirmed that any decisions of the High Court against the
State couldn’t be enforced without the consent of the Attorney General. In this
current constitutional dispensation, the provision of the Petition of Right Act
to the extent that it purports to prevent an aggrieved party from taking direct
action in court against the State is in riot conflict with Section 6(6)(b) of
the Constitution to the extent of its inconsistency null and void. Therefore
garnishee proceedings can be instituted against the government. See
RANSOME-KUTIv. AGF (1985) 2 NWLR (Pt 6) 211.
This extra formality or
red-tape was described by Lord Atkinson in HOLLINSHEAD v. HAZLETON (1916) 1 A.C
428 H.L in the context of the Petition of Right as “ merely an
amicable litigation taken by consent of the crown against the crown itself”. Eso
JSC describes it in RANSOME KUTI v AGF (Supra) as an “Unknown Soldier”.
red-tape was described by Lord Atkinson in HOLLINSHEAD v. HAZLETON (1916) 1 A.C
428 H.L in the context of the Petition of Right as “ merely an
amicable litigation taken by consent of the crown against the crown itself”. Eso
JSC describes it in RANSOME KUTI v AGF (Supra) as an “Unknown Soldier”.
POLICY CONSIDERATION BEHIND
SECTION 84(1) OF THE SCPA.
SECTION 84(1) OF THE SCPA.
The rationale for the
provision of prior consent of the AGF before a court can validly issue a
garnishee order nisi against funds in the hands of a public officer was
enunciated in the Case of ONJEWU v. KOGI STATE MINISTRY OF COMMERCE &
INDUSTRY (2003) 10 NWLR Pt. 827) 40 at 88-89 Per Muntaka- Commassie, JCA (as he
then was) now retired JSC thus:
provision of prior consent of the AGF before a court can validly issue a
garnishee order nisi against funds in the hands of a public officer was
enunciated in the Case of ONJEWU v. KOGI STATE MINISTRY OF COMMERCE &
INDUSTRY (2003) 10 NWLR Pt. 827) 40 at 88-89 Per Muntaka- Commassie, JCA (as he
then was) now retired JSC thus:
“ In my humble view, the
rationale for the provision for the previous consent of the AG before a court
can validly issue a garnishee order nisi against funds in the hands of a public
officer is to ensure that moneys that have been voted by the House of Assembly
of a State for a specific purpose is the Appropriation Bill presented to that
House and approved in the budget for the year of appropriation does not end up
being the subject of execution for other unapproved purposes under the SCPA”
rationale for the provision for the previous consent of the AG before a court
can validly issue a garnishee order nisi against funds in the hands of a public
officer is to ensure that moneys that have been voted by the House of Assembly
of a State for a specific purpose is the Appropriation Bill presented to that
House and approved in the budget for the year of appropriation does not end up
being the subject of execution for other unapproved purposes under the SCPA”
This decision has been
followed by plethora of decisions of the Court of Appeal vis UNIVERSITY OF
CALABAR TEACHING HOSPITAL v. LIZIKON (NIG) LTD & ANOR(2017)
LPELR-42339(CA), CBN v OKEFE (2015) LPELR – 24825 (CA).
followed by plethora of decisions of the Court of Appeal vis UNIVERSITY OF
CALABAR TEACHING HOSPITAL v. LIZIKON (NIG) LTD & ANOR(2017)
LPELR-42339(CA), CBN v OKEFE (2015) LPELR – 24825 (CA).
THE POSITION IN CBN v.
INTERSTELLA (SUPRA).
INTERSTELLA (SUPRA).
In 2017 the Supreme Court of
Nigeria was presented with the first opportunity to determine the
constitutionality or otherwise of this Section 84(1) of the SCPA under review,
vide an appeal by CBN challenging the concurrent findings of the lower courts
on the ground inter alia that no prior consent of the AGF was sought and
obtained before the Order Nisi by the Federal High Court Umuahia Coram
H.T Soba J was granted, which subsequently crystallized into an Order
Absolute. In this case, the Judgment creditor had obtained a consent
Judgment wherein the AGF on behalf of the Federal Government’s
inter-ministerial committee had agreed to pay the sumof N24.666 Billion as
novation for a debt owed by NITEL (a public corporation) and in so doing
induced the judgment creditors to alter their position by accepting a much
lesser amount from the actual debt. The Government indeed proceeded to pay a
fraction of the agreed sum; it was after it failed, refused or neglected to pay
the residue, that the 1st and 2nd respondent approached the court. At the
hearing of the appeal both the CBN (as garnishee) and the AGF argued forcefully
that the Order nisi obtained without prior consent was void hence the order
absolute attaching the amount standing in favour of the government is a nullity.
It was argued that the CBN’s compliance with the Said Section 84 of SCPA was
mandatory; being a public officer. It was the contention of the appellant
that the participation of the AGF in the negotiation leading to the compromised
sum and part payment thereof did not amount to consent as contemplated under
the Section 84(1) of SCPA because the negotiation is not a garnishee
proceedings.
Nigeria was presented with the first opportunity to determine the
constitutionality or otherwise of this Section 84(1) of the SCPA under review,
vide an appeal by CBN challenging the concurrent findings of the lower courts
on the ground inter alia that no prior consent of the AGF was sought and
obtained before the Order Nisi by the Federal High Court Umuahia Coram
H.T Soba J was granted, which subsequently crystallized into an Order
Absolute. In this case, the Judgment creditor had obtained a consent
Judgment wherein the AGF on behalf of the Federal Government’s
inter-ministerial committee had agreed to pay the sumof N24.666 Billion as
novation for a debt owed by NITEL (a public corporation) and in so doing
induced the judgment creditors to alter their position by accepting a much
lesser amount from the actual debt. The Government indeed proceeded to pay a
fraction of the agreed sum; it was after it failed, refused or neglected to pay
the residue, that the 1st and 2nd respondent approached the court. At the
hearing of the appeal both the CBN (as garnishee) and the AGF argued forcefully
that the Order nisi obtained without prior consent was void hence the order
absolute attaching the amount standing in favour of the government is a nullity.
It was argued that the CBN’s compliance with the Said Section 84 of SCPA was
mandatory; being a public officer. It was the contention of the appellant
that the participation of the AGF in the negotiation leading to the compromised
sum and part payment thereof did not amount to consent as contemplated under
the Section 84(1) of SCPA because the negotiation is not a garnishee
proceedings.
The court in resolving the
issue against the appellant relied on the relevant background facts leading to
the garnishee proceedings, describing same as very peculiar which cannot be
fitted with the general interpretation of Section 84 of the SCPA. The
court reasoned that under the doctrine of Accord and satisfaction, the judgment
creditor had forfeited substantial part of the debt on the representation of
the AGF negotiating on behalf of the state, which was clearly captioned in
documentary evidence, found in the record of Appeal as Exhibit Q. It posited
further that the AGF having assumed the indebtness of the original debtor by
subrogation therefore cannot take cover under the pretext of Section 84 SCPA
to deprive the Judgment debtor from enforcing his judgment.
issue against the appellant relied on the relevant background facts leading to
the garnishee proceedings, describing same as very peculiar which cannot be
fitted with the general interpretation of Section 84 of the SCPA. The
court reasoned that under the doctrine of Accord and satisfaction, the judgment
creditor had forfeited substantial part of the debt on the representation of
the AGF negotiating on behalf of the state, which was clearly captioned in
documentary evidence, found in the record of Appeal as Exhibit Q. It posited
further that the AGF having assumed the indebtness of the original debtor by
subrogation therefore cannot take cover under the pretext of Section 84 SCPA
to deprive the Judgment debtor from enforcing his judgment.
I applaud the decision of
the Supreme Court for rising up to the occasion of not being just a court of
law, but equally a court of justice after examining the factual matrix of this
case to hold that there was indeed implied consent by the AGF and/or that the
AGF is the actual debtor under this circumstance, thereby creating an exception
to the law. At page 74-75 of the lead Judgment, the Supreme Court per Clara
Ogunbiyi JSC (Retired) held thus:
the Supreme Court for rising up to the occasion of not being just a court of
law, but equally a court of justice after examining the factual matrix of this
case to hold that there was indeed implied consent by the AGF and/or that the
AGF is the actual debtor under this circumstance, thereby creating an exception
to the law. At page 74-75 of the lead Judgment, the Supreme Court per Clara
Ogunbiyi JSC (Retired) held thus:
“ … It is well and
explicit on the facts of this case that the AGF has all along held out himself
to be an active participant in several stages of negotiations, transactions and
even part payment of the debt owed. ….the most potent factor which makes
section 84(1) of the SCPA inapplicable herein is because the AGF is the debtor
and has been sued in that capacity. With the AGF being the Judgment debtor
therefore, will it not be absurd to require that his consent should be sought
especially having admitted that he had taken the move by paying part of the
debt in question?
explicit on the facts of this case that the AGF has all along held out himself
to be an active participant in several stages of negotiations, transactions and
even part payment of the debt owed. ….the most potent factor which makes
section 84(1) of the SCPA inapplicable herein is because the AGF is the debtor
and has been sued in that capacity. With the AGF being the Judgment debtor
therefore, will it not be absurd to require that his consent should be sought
especially having admitted that he had taken the move by paying part of the
debt in question?
It is the writer’s
submission that a holistic reading of the judgment under review will reveal
that there was no express nullification of Section 84(1) of the SCPA, neither
was the prevailing position in ONJEWU v. KSMCI (SUPRA) overruled. It simply
created an exception to the applicability of the law owing to the peculiar
factual matrix of this case; as a matter of fact it gave credence to the law at
page 72 where the court held thus:
submission that a holistic reading of the judgment under review will reveal
that there was no express nullification of Section 84(1) of the SCPA, neither
was the prevailing position in ONJEWU v. KSMCI (SUPRA) overruled. It simply
created an exception to the applicability of the law owing to the peculiar
factual matrix of this case; as a matter of fact it gave credence to the law at
page 72 where the court held thus:
“ it
should be noted clearly that the principle underlying securing the AGF’S
consent as prescribed in Section 84 SCPA is to avoid embarrassment on him of
not having the prior knowledge that funds earmarked for some purposes have been
diverted in satisfaction of a judgment debt, which the government may not know
anything about. See the persuasive authority of the case of ONJEWU v KDMCI
(Supra)”
should be noted clearly that the principle underlying securing the AGF’S
consent as prescribed in Section 84 SCPA is to avoid embarrassment on him of
not having the prior knowledge that funds earmarked for some purposes have been
diverted in satisfaction of a judgment debt, which the government may not know
anything about. See the persuasive authority of the case of ONJEWU v KDMCI
(Supra)”
IS THE CBN A PUBLIC OFFICER OR
A BANK WITHIN THE CONTEXT OF ATTACHING MONIES OF THE FGN?
A BANK WITHIN THE CONTEXT OF ATTACHING MONIES OF THE FGN?
Another position, which was
considered by the Apex Court in the CBN v. INTERSTELLA decision under
review, is with respect of this vexed question that has equally posed
tremendous hurdle to judgment creditors seeking to enforce judgment sum against
the FGN accounts domiciled with the CBN. The decision of IBRAHIM v. JSC
has lent credence in classifying the CBN as a public office hence can be held
out as custodial legis requiring consent. However, the Court
of Appeal per GALADIMA JCA (as he then was, later JSC (retired)) in PURIFICATION
TECHNIQUE v. AG LAGOS (2012) 1 BFLR 544 gave a very shy treatment to the
issue and relegated it to the back waters, when it held that there is
absolutely no basis for treating government’s bank accounts any differently
from bank accounts of every other juristic personality or customers. It is
pertinent to note that in this instant case, the Garnishee proceedings sought
to attach monies standing in credit to the Lagos State Government accounts
domiciled in Commercial Banks through CBN was equally sought to be attached.
considered by the Apex Court in the CBN v. INTERSTELLA decision under
review, is with respect of this vexed question that has equally posed
tremendous hurdle to judgment creditors seeking to enforce judgment sum against
the FGN accounts domiciled with the CBN. The decision of IBRAHIM v. JSC
has lent credence in classifying the CBN as a public office hence can be held
out as custodial legis requiring consent. However, the Court
of Appeal per GALADIMA JCA (as he then was, later JSC (retired)) in PURIFICATION
TECHNIQUE v. AG LAGOS (2012) 1 BFLR 544 gave a very shy treatment to the
issue and relegated it to the back waters, when it held that there is
absolutely no basis for treating government’s bank accounts any differently
from bank accounts of every other juristic personality or customers. It is
pertinent to note that in this instant case, the Garnishee proceedings sought
to attach monies standing in credit to the Lagos State Government accounts
domiciled in Commercial Banks through CBN was equally sought to be attached.
At
page 76-78 of the CBN v. INTERSTELLA the Supreme Court was confronted
with this issue. Again, the Court considered the factual circumstances of the
case in interpreting the statute to meet the “Justice” of the case. It was
persuaded by the position taken in PURIFICATION TECHNIQUE v. AG LAGOS (Supra)
that CBN is just a Banker to the FG who can be sued as garnishee in satisfying
debt in its custody. Where it held thus
page 76-78 of the CBN v. INTERSTELLA the Supreme Court was confronted
with this issue. Again, the Court considered the factual circumstances of the
case in interpreting the statute to meet the “Justice” of the case. It was
persuaded by the position taken in PURIFICATION TECHNIQUE v. AG LAGOS (Supra)
that CBN is just a Banker to the FG who can be sued as garnishee in satisfying
debt in its custody. Where it held thus
“The relationship between
the 3rd respondent and the appellant in this case, same is purely that of a
banker to a customer. Therefore, the question of whether the appellant is a
public officer, who cannot release funds except the consent of the AGF is obtained
does not apply to the facts and circumstances of this case”.
the 3rd respondent and the appellant in this case, same is purely that of a
banker to a customer. Therefore, the question of whether the appellant is a
public officer, who cannot release funds except the consent of the AGF is obtained
does not apply to the facts and circumstances of this case”.
Finally, it is the writer’s
contention that CBN v. INTERSTELLA has created wide panoply of
exceptions from different fronts to the general principle, which will assist
Judgment Creditors in their quest for monetary enforcement against the state,
however it did not in my opinion expressly address and/or nullify the constitutionality
of Section 84 of the SCPA.
contention that CBN v. INTERSTELLA has created wide panoply of
exceptions from different fronts to the general principle, which will assist
Judgment Creditors in their quest for monetary enforcement against the state,
however it did not in my opinion expressly address and/or nullify the constitutionality
of Section 84 of the SCPA.
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