– Nelson Onuoha
1.0 Summary of Facts
The Respondents, as Plaintiffs, instituted an action at the Federal High Court, Lagos against the Appellant under the undefended list procedure, seeking monetary reliefs and pre-judgment interest thereon. The reliefs sought were based on the Appellant’s alleged failure to pay the Respondents the agreed fees in respect of professional services the Respondents rendered to the Appellant despite the Respondents’ repeated demands for same.
Following the hearing, the trial Court found in favour of the Respondents and granted all the reliefs sought.
Dissatisfied with the decision of the trial Court, the Appellant appealed to the Court of Appeal which dismissed the appeal and upheld the decision of the trial Court.
Further aggrieved with the decision of the Court of Appeal, the Appellant appealed to the Supreme Court, the appeal leading to the decision under review. At the Supreme Court, amongst other issues, the apex Court was called upon to decide: whether in the absence of any specific agreement or evidence of custom or trade usage in support of the Respondents’ claim for pre-judgment interest, and considering the unliquidated nature of a pre-judgment interest claim; the Court of Appeal was right to affirm the decision of the trial Court with respect to the grant of pre-judgment interest under the undefended list procedure?
2.0 Decision of Court
In its Judgment, the Supreme Court resolved all the issues in the appeal in favour of the Respondents, and dismissed the appeal.
In upholding the propriety of the award of pre-judgment interest by the trial Court, it was the reasoning of the Court that although a party seeking pre-judgment interest must prove the basis for his entitlement to same by showing that it is supported by either statute, contract between the parties or that it is based on trade usage or custom or on some principle of equity; it is, however, valid for a Court to still grant pre-judgment interest on a monetary sum awarded to a successful party even in situations where that party failed to plead or adduce any evidential basis in support of the pre-judgment interest claim. The learned Justices further held that such an award of unproven pre-judgment interest naturally accrues from the failure or refusal of the Defendant to pay the subject amount owed to the Plaintiff over a long period of time, thereby depriving the Plaintiff the use of and/or enjoyment of the sum owed.
Regrettably, the Supreme Court did not resolve or make any pronouncement in respect of the Appellant’s contention as to the impropriety of granting a pre-judgment interest claim in a matter determined under the undefended list procedure.
3.0 Analysis/Comments on Decision of Court
It has always been and still remains the position of Nigerian evidential law that pre-judgment interest can only be awarded to a party where that party has pleaded sufficient facts and led credible evidence to show that he is entitled to pre-judgment by virtue of statute, contractual terms, trade usage or custom or any equitable principle of contract. See Habib Nig. Bank Ltd. v. Gifts Unique (Nig.) Ltd. (2004) 15 NWLR (Pt. 896) 408; E.I.B. Building Society Ltd. v. Adebayo (2003) 11 NWLR (Pt. 832) 497.
Recently, in Julius Berger (Nig.) Plc v. T.R.C.B. Ltd. (2019) 5 NWLR (Pt. 1665) 219 at 257, paras. D- G, the same Supreme Court, in setting aside an award of pre-judgment interest for failure to plead or prove the basis of same, held as follows:
“With respect to the power to award interest before judgment, it is to be reiterated that it is based on statute or a right based on common law or some equitable principle of contract. It is because of the peculiar or special nature of this interest that it is mandatory that before such an award can be claimed, the facts in support must be pleaded and evidence led to support the head of the claim and in the same vein the rate being the prevailing rate of bank interest at the time of judgment or award. That is to say, that the need for evidence establishing that rate cannot be overemphasized. Therefore, in the instant case where the respondent neither pleaded nor led evidence to show any custom, agreement or statute under which it founded its claim of interest against the appellants, the trial court erred in awarding the pre-judgment interest against the appellants”
By the very nature of pre-judgment interest (i.e. interest accruing on a judgment sum before judgment is entered), it presupposes that a party claiming it must place sufficient materials before the court to show why he is so entitled. He must lead evidence not only to show that he is entitled to such interest but to show that the interest rate which he is claiming is the proper one. A court cannot on its own without any reason or basis sufficiently established by a plaintiff, proceed to award pre-judgment interest at any rate in favour of that plaintiff. To do so would appear arbitrary and antithetical to the role of a Judge as an unbiased umpire who is to dispassionately resolve the dispute between parties based on the facts and evidence presented before it by the parties.
It is settled Nigerian evidential law that a court can only resolve the disputes of parties before it based on credible and cogent evidence placed before it by the parties. A court cannot proceed to speculate or assume that a party is ordinarily entitled to relief. That party must plead sufficient facts and adduce credible and cogent evidence before the court can award such a relief. See Ladoja v. Ajimobi (2016) 11 NWLR (Pt. 1519) 88 at 173 para G., Daniel v. INEC (2015) 9 NWLR (Pt. 1463) 113 at 157 para. A. Sections 131, 133 and 134 of the Evidence Act, 2011 provide that in all civil proceedings, the burden of proving a fact is only discharged on the balance of probabilities or the preponderance of evidence. Before a court can award any relief claimed or asserted by a party, the court must be satisfied that the party has led preponderant evidence establishing that party’s entitlement to such a claim. See Interdrill (Nig.) Ltd. V. U.B.A. Plc (2017) 13 NWLR (Pt. 1581) 52 at 75 paras. C-D. Claims, more especially special claims like pre-judgment interest, are not awarded by a court willy-nilly.
It is therefore submitted, with due respect, that the learned Justices of the Supreme Court unwittingly upturned our evidential legal order when they held that the trial Court was right to award pre-judgment interest even when same was not proved. Before a court can award pre-judgment interest, the party seeking the same must place before the court credible and cogent evidence evincing any statutory or contractual provision or any trade usage/custom or equitable principle establishing that party’s right to pre-judgment interest at the rate claimed. A court cannot in the guise of attempting to do substantial justice, award to a party what he has not adequately shown to be entitled to.
Given that it was established that the Respondents did not adduce any evidence establishing the basis for their claim for pre-judgment interest, the trial Court ought not to have awarded it and the Court of Appeal and the Supreme Court ought to have set aside the award.
With all due respect, the learned Justices of the Supreme Court were also wrong in failing or omitting to pronounce on the Appellant’s contention on the impropriety of awarding a pre-judgment interest claim in a suit determined under the undefended list procedure. It is the position of Nigerian law that a court has a duty to consider and resolve all issues raised before it by parties in litigation as failure to do so could amount to a denial of fair hearing and could occasion a miscarriage of justice. See Brawal Shipping Ltd. vs. F.I. Onwadike Co. Ltd. (2000) 11 NWLR (Pt. 678) 387 at 403 para E-F; E.F.C.C v. Akingbola (2015) 11 NWLR. (Pt. 1470) 249 at 301 paras. C-D.
Since it was indeed very contentious that the trial Court ought not to grant a pre-judgment interest in a suit decided under the undefended list procedure, the Supreme Court ought to have particularly considered and resolved that issue. The Court’s failure to pronounce on that contention was fatal to that aspect of the appeal.
In Nigerian civil litigation procedure, a plaintiff who reasonably believes that the defendant has no defence to the plaintiff’s liquidated money demand claim, can proceed to institute an action to enforce that claim under the undefended list procedure. Where the court is satisfied that the defendant has no reasonable defence to the plaintiff’s claims, the court will proceed to award the reliefs sought by the plaintiff provided that they are in respect of claims for liquidated money demand. The Courts have defined a liquidated money demand claim, which a court is capable of awarding under the undefended list procedure, to mean “a debt or specific sum of money usually due or payable which is ascertainable or calculable by arithmetic or mathematical precision without any further investigation” See Micmerah Int’l Agency Ltd. v. A-Z Petroleum Products Ltd. (2012) 2 NWLR (Pt. 1285) 564.
It has also remained the position of the Courts that a claim for interest is not a liquidated money demand claim and as such, a court cannot award it under the undefended list procedure. The assessment or grant of interest is unknown and inapplicable to the undefended list procedure. See Gombe v. PW (Nig.) Ltd. (1995) 6 NWLR (Pt. 402) 402; Ekerete v. UBA Plc (2005) 9 NWLR (Pt. 930) 401 at 414.
It follows therefore that the trial Court was wrong to have awarded pre-judgment interest since the suit was heard and determined under the undefended list procedure. Apparently, this was a weighty issue which the Supreme Court ought not to have glossed over or abandoned. It was an issue that was clearly crucial to the part of the appeal against the award of pre-judgment interest. It, therefore, beggars belief that the Supreme Court failed to pronounce on it or resolve it.
Given that the apex Court is the last bus stop in the litigation dispute resolution process, it is imperative that in resolving disputes submitted to it by litigating parties, all issues raised therein are pronounced on with finality as no other avenue exists thereafter to determine any issue left unresolved. In the eternal words of Late Justice Chukwudifu Oputa (JSC), our Supreme Court Justices are indeed not final because they are infallible but infallible because they are final.