IN THE SUPREME COURT OF NIGERIA
ON FRIDAY, THE 11TH DAY OF JUNE 1976
BATA NIGERIA (SALES) LTD. .................................................. APPELLANT
BRIGADIER MARTIN ADAMU ................................................. RESPONDENT
BEFORE: Alexander C.J.N. Fatayi-Williams and Bello, JJ.S.C
The Supreme Court set aside the judgment in the original suit and sent back the case for rehearing, with directions (a) that the parties be at liberty to amend their pleadings if so advised and (b) that the issues described in its judgment and clearly relevant to a just decision of the cause as put by the parties should be duly determined.
At the retrial, the defendant was refused leave to set up a counter-claim in an amended statement of defence, on the grounds that the counter-claim raised a novel issue, and that to grant the leave sought would be a disregard of the Supreme Court order.
(1) (a) The direction that the issues clearly relevant to a just decision of the cause should be decided did not exclude other material issues that could arise from the pleadings in their amended form, and was in fact a direction relating to the hearing and determination of the action and not to amendment of pleadings; and
(b) The direction that parties be at liberty to amend their pleadings did not place any restriction whatever on the liberty to amend.
(2) Although the defendant could, in the alternative, file a fresh action claiming the relief sought in the counter-claim, it would be in the interest of justice for all material issues to be heard and determined in one trial; and the trial Judge did not, in all the circumstances, correctly exercise his discretion.
Taiwo & Ors. v. Akinwunmi & Ors. (1975) 4 S.C. 143
Shomade & Anor v. Ogunbiyi & Ors. 3 W.A.C.A. 48
Purtz v. Spence 36 Ch.D.770
The Alert 72 LT 124
Clarapede v. Commercial Union Association 32 W.R.263
APPEAL allowed. Leave to defendant to file the amended statement of defence; liberty to plaintiff to file reply.
Bayo Kehinde for the appellant.
Chief Owen Fiebai for the respondent.
Alexander, C.J.N. (delivering the judgment of the Court):-The original suit (No. JD/71/1974) between the plaintiff and defendant was heard in the High Court of the former Benue-Plateau State, in Jos, by Bate S.P.J., (as he then was), from whose judgment there was an appeal to this Court. The appeal was allowed, the judgment of the High Court including the order for costs was set aside, and the case was sent back for rehearing by the High Court with directions that:-
(1) the parties be at liberty to amend their pleadings if they are so advised and
(2) the issues described above (that is, in the judgment) and clearly relevant to a just decision of the cause as put by the parties shall be duly decided.
Pursuant to these directions the plaintiff filed an amended statement of claim dated 10th November, 1975, in paragraph 10 of which he claims against the defendant:-
(a) "a declaration that the sub-lease aforesaid granted in favour of the defendants was determined by reason of defendant's breach of some of the terms of the sub-lease aforesaid by sub-underleasing without consent and further by plaintiff's re-entry of part of the demised premises.
(b) an injunction restraining the defendants, their servants and agents from committing or continuing to commit further trespass,
(c) and damages of
N36,000 (thirty-six thousand Naira) for trespass.
It was alleged, in particular, in paragraph 4 of the amended statement of claim that:-"By clause 2 (viii) and (ix) of the deed of sub-lease ... the Company was-
(viii) not to assign, underlet or part with the possession of the demised premises or any part thereof without first obtaining the written consent of the sub-lessor such consent, however, not to be unreasonably withheld in the case of a respectable and responsible person, and
(ix) not to permit any sale by auction to be held upon the demised premises or suffer any part of the said premises to be so used as to cause nuiscance, annoyance, or inconvenience to the occupiers of adjacent houses or the neighbourhood."
The defendant then filed an application by way of motion on notice dated 2nd December, 1975, for an order pursuant to Order 26, rule 4 of the relevant rules of court for leave to set up a counterclaim in the terms set forth in paragraph 15 of the statement of defence and captioned "Counterclaim" as follows:-
15. The defendant repeats paragraph 1-13 of the statement of defence, and if, contrary to his contention, it should be found that he has committed the alleged or any breach or breaches of the covenants in clauses 2 (viii) and 2(ix) or either of those clauses of the deed of sub-lease, he claims to be relieved from the alleged forfeiture."
Paragraph 9 of the amended statement of defence which the defendant sought to file also contained the following averments:-
(b) The defendant states that there was no allegation of breach of the covenant in paragraph 2(ix) of the sub-lease prior to the commencement of the present action.
(c) During the first trial of this action the plaintiff deliberately abandoned and/or waived the alleged breach of the covenant in paragraph 2(ix) of the sub-lease and did not pursue same. Accordingly the order of retrial by the Supreme Court cannot operate to revive an alleged breach which the plaintiff had waived as aforesaid ..."
In paragraph 12 of the amended statement of defence the defendant further pleaded:-
"The defendant pleads waiver and avers that if (which is denied) there has been a breach of the covenants in the deed of sub-lease as alleged in the statement of claim such breach has been waived by the plaintiff and/or his predecessor in title."
The application for leave to set up a counterclaim was heard by Belgore J. sitting in the High Court of the former Benue-Plateau State and dismissed by him in a ruling dated 12th December, 1975. The defendant then appealed to this Court seeking to set aside the ruling and order of the High Court and to obtain an order that the defendant "be entitled to set up a counterclaim with their amended statement of defence."
The appellant's grounds of appeal are as follows:-
"(i) That the learned trial Judge erred in law by holding that the issue of a counterclaim is new to the claim before the court when the issue of the particular counter-claim arises from or is dependent on the claim before the court.
(ii) That the learned trial Judge erred in law by holding that to grant leave to file a counter-claim would be a disregard of the order of the Supreme Court when the said order of Supreme Court has granted liberty to both parties to amend their pleadings.
(iii) That the learned trial Judge erred in law by holding that the 'return date' stipulated on Order 26, rule 4 of the rules of court applicable in the High Court of the Benue-Plateau State refers to the return date given on the filing of the writ of summons in 1974.
(iv) That the learned trial Judge erred in law by holding that Order 33 of the said rules of court does not cover the statement of defence which was amended to include a counter-claim."
Ground (iii) was virtually abandoned by learned Counsel for the appellant who ultimately conceded that he would not rely on this ground of appeal. In his argument, based on the remaining three grounds of appeal, which were argued together, he submitted that the issue raised in the counterclaim was not a "novel" one as stated in the ruling, but was dependent on the claim before the High Court and relevant to a just decision of the cause; and that the defendant, having denied liability in respect of the alleged breaches of covenants in the sub-lease and pleaded waiver, it was necessary in the circumstances to counterclaim for relief from forfeiture. He contended that the addition of such a counterclaim to the statement of defence is an amendment of the defendant's pleading, which the defendant is at liberty to amend in accordance with the directions of this Court and that the granting of leave to file such a counterclaim could not therefore be a "disregard of the Supreme Court Order" as stated in the ruling and was not inconsistent with the directions. He submitted further that to avoid "multiplicity of actions" the learned judge should have exercised his discretion to allow the counterclaim under the proviso to rule 4(a) of Order 26 of the relevant rules of court.
Rule 4(a) reads as follows:-
"No defendant shall be allowed to set up any such counterclaim ... unless he shall have lodged with the registrar four clear days before the return day a notice ... containing his name and address and a concise statement of the grounds of such counterclaim ... and shall have paid the same court and service fees as would be payable if he were claiming by writ of summons:
Provided that the court may in its discretion, and on such terms as may seem just allow the defendant to set up a counterclaim ... notwithstanding that such notice has not been duly lodged."
Learned Counsel for the respondent, on the other hand, submitted that the addition of a counterclaim to a statement of defence is not an amendment of a pleading but the filing of an independent action and that a counterclaim is not a pleading; and, further, that the granting of leave to file such a counterclaim would be completely outside the directions of this Court in the earlier judgment. He contended also that the learned judge was right in regarding the issue in the counterclaim as a "novel" one and in refusing the application for leave to file the counterclaim.
On the whole we find ourselves in agreement with the sub-missions of learned Counsel for the appellant. First of all, it is clear that direction No.(2) that:-
"The issues described above and clearly relevant to a just decision of the cause as put by the parties shall be duly decided,"
was a direction to the trial court only and did not exclude other material issues which were not described in the earlier judgment of this Court, but which could arise out of the pleadings before the High Court in their amended form. This direction relates soley to the hearing and determination of the action and not to the amendment of pleadings. Direction No.(1) that:-
"The parties be at liberty to amend their pleadings if they are so advised",
relates solely, however, to amendment of pleadings and no restriction whatever has been placed on the liberty to amend.
We have now arrived at the real issue in this appeal which is whether or not the addition of a counterclaim in the terms of paragraph 15 of the amended statement of defence is an amendment permissible under direction No.(1) contained in the earlier judgment of this Court.
In Taiwo & Ors. v. Akinwumi & Ors. (1975) 4S.C. 143 this Court held that a claim by a tenant for relief from forfeiture could be commenced either by writ or originating summons or by way of a counterclaim in an action brought by the landlord.
In Shomade and Anor v. Ogunbiyi & Ors. 3 W.A.C.A. 48, cited by learned Counsel for the respondent, it was held, in a majority decision of the West African Court of Appeal, that if substantial justice can be secured by an amendment of pleadings, such amendment should be allowed. The expression "pleading" is defined in section 2 of the relevant High Court Law (Cap.49) and obviously includes a counter-claim. Further, rule 14 of Order 32 of the relevant rules of court relating to pleadings stipulates the procedure to be followed when any defendant seeks to rely upon any facts, as supporting a right of set-off or counterclaim.
Rule 3 of Order 26 of the relevant rules of court, while enabling a defendant to set up a counterclaim, provides that the court may, if in its opinion such a counterclaim cannot be conveniently disposed of in a pending action, or ought not to be allowed, refuse permission to the defendant to avail himself thereof. It is, however, desirable that multiplicity of legal proceedings be avoided (See Kurtz v. Spence 36 Ch.D. 770) The Alert, 72 L.T. 124). It is not disputed that the appellant could, in the alternative, file a fresh action claiming relief from forfeiture. We are, however, satisfied that it will be in the interest of justice that all material issues should be heard and determined in one trial instead of two or more.
The learned judge made reference to the period of "over a year" that had elapsed between the original return day and the application for leave to file the counterclaim. It was not contended that the time for filing the appellant's amended statement of defence had expired before the filing of the application for leave to set up the counterclaim. Nor is it contended that the counterclaim cannot be set up by reason of any statutory limitation. In Clarapede v. Commercial Union Association 32 W.R. 263, Brett M.R. said:-
"However negligent or careless may have been the first omission, and however late the proposed amendment, the amendment should be allowed if it can be made without injustice to the other side. There is no injustice if the other side can be compensated by costs."
We are satisfied, in all the circumstances, that the learned judge did not correctly exercise his discretion in dismissing the application. This appeal is accordingly allowed, and the ruling and order of the High Court dated 12th December, 1975, are set aside. It is ordered and directed that the appellant be allowed to file an amended statement of defence and to set up a counterclaim in terms of paragraph 15 of its amended statement of defence, and that the respondent be allowed to file a reply thereto if he is so advised.
It is further ordered that the respondent do pay to the appellant the costs of this appeal assessed at