Enforcing Foreign Judgments in Nigeria: ‘Ex Abundanti Cautela’

In a series of judgments going back to at least 2003 Nigeria’s highest courts, especially the Supreme Court, have provided greater clarity concerning the statutory regimes for enforcing foreign money judgments in Nigeria. Nevertheless, an examination of the decisions of the courts and the practical implications of some of the most recent decisions indicate that an enormous amount of caution is still required when seeking to enforce a foreign judgment in Nigeria.

In one of the most recent cases, Access Bank v Akingbola (2014), the Lagos State High Court advised that the judgment creditor should have acted ex abundanti cautela (‘out of the abundance of caution’) when selecting which Nigerian court to approach for the enforcement of a judgment of the English High Court. It is contended that the necessity for caution, while indeed advisable and recommended, is in part due to uncertainty and confusion arising from very questionable interpretations and decisions of the courts themselves.

There are two statutory regimes under which it may be possible to enforce a foreign judgment in Nigeria. The first is the Reciprocal Enforcement of Judgments Act 1922 (‘the 1922 Act’ which is sometimes confusingly referred to as the 1958 Act) and the Foreign Judgments (Reciprocal Enforcement) Act 1960 (‘the 1960 Act’ which is sometimes referred to, also confusingly, as the 1990 Act). While it had been assumed to some degree that the advent of the 1960 Act had led to the repeal of the 1922 Act, the Supreme Court has decided, rightly, that the 1922 Act was never repealed and remains in force; (see inter alia Macaulay v RZB of Austria [2003] 18 NWLR 282). The 1922 Act continues to be available for the enforcement by registration of judgments of the courts of the United Kingdom and some Commonwealth countries to which its application is extended by proclamation. This is what was always intended and the countries to which the 1922 Act applies include specifically the countries listed in an extant proclamation order (Laws of the Federation of Nigeria and Lagos (1958) vol IX, cl 175, s. 5).

The 1960 Act, by its terms, is intended to apply in respect of judgments from foreign countries on the basis of reciprocity, i.e., on the basis that Nigerian judgments are given reciprocal treatment in the courts of the country concerned. By its terms, the potential application of the 1960 Act is not confined to judgments from only Commonwealth countries. Rather, the Act can apply in respect of the judgment of any country at all – as long as the requirement of reciprocity is satisfied. Ordinarily, the reciprocity requirement is met when the Minister of Justice makes an Order that the 1960 Act shall apply in respect of the judgments of the designated superior courts of a particular country. The courts have now confirmed that no such order has been made under the Act and, ordinarily, the reciprocity requirement under the 1960 Act is not currently satisfied in respect of any country – except in the unlikely event that the courts allow proof of reciprocity by a means other than Ministerial order. Ordinarily also, according to sound principles of statutory interpretation, this should mean that no judgment from any country whatsoever can be enforced under the 1960 Act.

Rather surprisingly, the Nigerian Supreme Court has held that a particular part of the 1960 Act can be invoked to enforce a foreign judgment, even in the absence of a ministerial order. The Nigerian Supreme Court has held that section 10(a) of the 1960 Act can be invoked as an exception to the requirement of a ministerial order. In reaching this conclusion, the court took the view that section 10(a) is an “interim” provision intended to apply before the Minister of Justice makes an order under the Act. It has been argued extensively elsewhere that this approach is not only of dubious accuracy but that it is also self-contradictory; otherwise, it is at best an exercise in judicial pragmatism. (See the article:  ‘The Enforcement of Foreign Money Judgments in Nigeria: A Case of Unnecessary Judicial Pragmatism?’ in (2012) 12(1) Oxford University Commonwealth Law Journal 1)

The reality is that the provisions of section 10(a) of the 1960 Act are not supposed to apply at all before the making of an Order of the Minister; rather they are supposed to apply before the commencement of an order of the Minister. This presupposes that only when an order has been made but before its commencement can the provision of section 10(a) of the 1960 Act be invoked. The drastic reality is that the provisions of the1960 Act are not truly supposed to be invoked at all presently – unless and until (a) relevant ministerial order(s) is/are made!

That the conclusion of the Supreme Court applying section 10(a) of the 1960 Act in the absence of any ministerial order is contradictory is apparent on a careful examination of some of the statements of the court itself. For example Mohammed JSC, who delivered some of the most lucid reasoning on this topic, observed as follows:

‘the entire provisions of Part I of the [1960 Act] containing section 4 of the Act require a positive action on the part of the Minister of Justice of the Federation to bring that part of the Act into force.  Part I…. comprises sections 3, 4, 5, 6, 7, 8, 9, and 10. From the provi­sions of section 3 of the Act . . . it is quite clear that the provisions of Part I of the Act remains (sic) dormant or inactive until life is breathed into them by an order promul­gated by the Minister . . .’ (Marine & General Assurance Co Plc v Overseas Union Insurance Ltd & Ors [2006] 4 NWLR 622,643)

Similar sentiments as above are repeated by Mohammed JSC and his brother justices on the Supreme Court bench in other cases including: Grosvenor Casinos Ltd v Ghassan Halaoui [2009] 10 NWLR 309. According to the statement of Mohammed JSC above, the entire provisions of Part 1 of the 1960 Act require an order promulgated by the Minister of Justice before they can come into force and otherwise they remain dormant. But then section 10(a) which the Supreme Court applies is also within the said Part I whose entire provisions are still dormant until the promulgation of a ministerial order! In a sense, the Supreme Court side-stepped this evident contradiction by claiming that section 10(a) is applicable exceptionally as an interim measure before a ministerial order is made. The critical point, however, is that section 10(a) does not contain any such exception. By its terms, even section 10(a) is not supposed to be applicable or to be applied before a ministerial order is made at all; it is only applicable before the commencement of a ministerial order that has been made.

It is not difficult to identify reasons why it is easy to fall into the temptation to find a way to make the provisions of the 1960 Act invocable for the enforcement of foreign judgments. In the absence of the approach taken by the Supreme Court judgments from several countries, including judgments from important trading partner countries, cannot be enforced by registration though they can still be enforced by action on the judgment debt. The only statutory registration regime that can be invoked, the 1922 Act, is only applicable in respect of the United Kingdom and the Commonwealth countries to which its provisions have been extended. For example, a case like Teleglobe America Inc v 21st Century Technologies Ltd  (2008) 17 NWLR (Pt 1115) 108 would have had to be decided differently since there is no ministerial order extending the 1960 Act to the USA. Consequently, it would mean that American judgments cannot be enforced by registration but rather by action, although it may be possible to expedite the action to some extent by use of the undefended list procedure.

There are additional benefits to the invocability of the 1960 Act, although those are not key presently, including the fact that when it is truly operative a judgment creditor can have up to six years to apply for the registration of the judgment as opposed to just one year under the 1922 Act. From the Supreme Court’s perspective, this was a telling and decisive matter in the recent case of VAB Petroleum v Mike Momah (SC, 2013), for example.

In fact, the issue of the length of availability of time to apply for registration of a foreign judgment contributed to the conclusion of the Supreme Court that has been argued to be erroneous. Under the provisions of section 10(a) of the 1960 Act, a judgment given before the commencement of a ministerial order extending the 1960 Act to its country of origin may be registered within one year from the date of the judgment. It has been argued extensively and in detail that the true purpose of this provision “is to reiterate the operation of the 1922 Act in respect of judgments from the UK and Commonwealth countries to which that Act had been extended until the operation of the 1960 Act is triggered in respect of the UK and any such Commonwealth country by a ministerial order under the latter Act” (OUCLJ Enforcement article referred to earlier). In any event, the terms of section 10(a) are fairly straightforward that the one year period for enforcement allowed under the provision is in respect of a judgment given before the commencement of a ministerial order — and not before the issuance of such an order.

A surprising recent development arose from the judgment of the High Court of Lagos State from which the suggestion to adopt an ex abundanti cautela approach is taken. In Access Bank plc v Akingbola, the Lagos High Court ruled that the court in which the enforcement of the judgment of the English court in the particular case should have been sought was the Federal High Court. The reason for this was, in effect, that if the original action had been tried in Nigeria the court with rightful jurisdiction would have been the Federal High Court because the original (foreign) judgment concerned the statutory duties of the judgment debtor under the Companies and Allied Matters Act 1990 as a director. The court concluded that, in light of that fact, the judgment creditor should have sought enforcement of the foreign judgment in the Federal High Court ex abundanti cautela i.e. out of an abundance of caution. The judgment debtor’s arguments that he did not carry on business in the jurisdiction of the foreign court or that he did not voluntarily appear before that court are not key issues in this particular respect. Compare e.g. Union Petroleum Services Ltd v Petredec Ltd (CA, 2014)

With all due respect, the decision of the Lagos High Court evinces a very questionable understanding of the principles underlying statutory regimes for the enforcement of foreign judgments by registration. The real issue is not to address or determine which court in the enforcing country would have been properly seised of a matter; rather, the issue is to be satisfied that the foreign court indeed had jurisdiction and properly assumed jurisdiction over the cause for which its judgment is sought to be enforced. Assuming for example that the judgment debtor’s action which led to the foreign action had been perpetrated in Ghana, it would have been absurd for the Nigerian courts to delve into the issue of which Ghanaian court would have had jurisdiction rather than examining whether the foreign trial court itself had jurisdiction and properly assumed jurisdiction. The fact that the judgment debtor is Nigerian and perpetrated the relevant actions largely in Nigeria is not of itself determinative of the jurisdiction of the foreign court. The fact that such a matter would have been tried in the Federal High Court if it had been pursued in Nigeria does not of itself undermine the jurisdiction that a foreign court may have in respect of the same or a related matter.

Most crucially, the fact that a similar original action if commenced in Nigeria should have been properly commenced in the Federal High Court does not mean that the enforcement of a foreign judgment must necessarily be sought in the Federal High Court. From a practical perspective, a primary concern is to locate the jurisdictions in which a judgment debtor has assets and then to approach the courts of such a jurisdiction to enforce the relevant foreign judgment. As the judgment debtor in this particular case is alleged to have assets in Lagos State, it is a sound legal manoeuvre to approach the courts with territorial jurisdiction in Lagos State for the enforcement of the relevant judgment. Importantly, the ordinarily ‘unlimited’ subject-matter jurisdiction of the Lagos High Court is not excluded simply because the foreign judgment concerned a matter that under Nigerian law would have been heard, as an original matter, in the Federal High Court.

It would be very surprising if the decision of the Lagos High Court in Access Bank Plc v Akingbola in particular is not challenged further in the Nigerian appellate courts. Nevertheless, the case does confirm that the matter of approaching the Nigerian courts for enforcing foreign judgments in Nigeria is a matter that requires ‘an abundance of caution’; it is truly a case of proceeding ex abundanti cautela.

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