LEGAL REMEDIES FOR INJURIES TO BODY, PROPERTY, REPUTATION,BUSINESS OR RELATIONSHIP IN NIGERIA

There are conducts and statements with the potential of inflicting  physical, social, psychological and economic damage on people.This edition of Akintunde Esan’s Legal Illumination is illuminating on  the unscrupulous conducts and statements usually causing harm  to the body, property, reputation, business and relationship of people of which the victims of the wrong are entitled to seek for compensation (damage) from the wrongdoer in a court of competent jurisdiction, including an order of court (injunction) restraining the wrong doer from continuing with the unscrupulous acts or statements.

1.	Battery	Intentional application of force to another person.
2.	Assault	Intentional putting of another in fear of imminent battery.
3.	False Imprisonment	To detain a person in a place or restrain a person’s movement it includes the instigation of the Police to arrest and detain you without reasonable or probable cause.
4.	Negligence	Failure to take care of a person or thing which you owe a duty to take care of which resulted into injury to the person or thing or loss, e.g. a teacher and a student, doctor and patience
5.	Malicious Prosecution	Where a person maliciously without reasonable and probable cause uses the Police or any Government agency against you to initiate criminal proceedings against you which ends/terminates in your favour and which results in damages to your reputation, person and property.
6.	Malicious Falsehood	This is the making of a false statement by one person against the person or property of another person which is calculated to cause that other person damage and as a result of which he actually suffered damages.
7.	Trespass to Land	Where another without lawful justification or without your invitation or permission: a. Enters upon your land, or b. Remains upon your land, or Directly places or projects any material objects upon your land.7.
8.	Conversion	Where another exercise temporary or permanent right or dominion of ownership on your property. To deprive you of the possession of your chattel/property e.g. to use or take or give away or destroy your property without your permission.
9.	Detinue	Failure to release property kept in the custody of another on demand.
10.	Nuisance	Interference with the use and the enjoyment of your property, e.g. unreasonable noise or smell emanating from your neighbouring land, obstruction to your right of way or right to light, an object or activity of nearby building causes material damage to your property.
11.	Defamation	Defamation includes statements which tends: a. To lower you in the estimation of right-thinking members of society generally; or b. To expose you to hatred, contempt or ridicule; or c. To cause other persons to shun or avoid you; or d. To discredit you in office, trade or profession; or e. To injure your financial credit or standing Libel: Defamation in a permanent form such as written or printed words Slander: Defamation in a transient form such spoken words or gestures
12.	Deceit	When you rely on a false statement made to you believing it to be true and you suffer damage thereby.
13.	Passing off	The selling or marketing of a product or carrying on of a business in such a manner as to misled the public into believing that the product or business is that of you own.
14.	Enticement	Persuading, inducing, inciting or procuring the wife of another without lawful justification to leave and remain apart from her husband.
15	Harbouring	Giving shelter to an errant/ wayward wife.

REMEDIES Injunction: An order of court restraining the wrong doer from continuing to commit the civil wrong. Damages: Damages is Money claimed by or ordered to be paid to a person as compensation for loss or injury he has suffered following a tort or a breach of contract or civil wrong. In addition to an injunction you are entitled to an award of damages or for an order directing the other party to pay you damages or compensation for the injury suffered. Special Damages: Mathematical calculation of all expenses incurred e.g. medical expenses, solicitor’s fee and material or financial loss suffered. General Damages: Losses that cannot be mathematically calculated but estimated such as pain and suffering, loss of enjoyment of life, loss of expectation of life, loss of earning or future earning, injury to your dignity, nervous shock, trauma. Aggravated Damages: this is awarded in addition to actual damages when the wrong doer acted with recklessness, malice or deceit, cruelty, fraud, insolence and disregard for the law. It is meant to punish/penalize the wrongdoer or make him an example to others. © 2017 Akintunde Esan, Managing Partner, Ase Olodumare Chambers For further illumination on seeking judicial redress or remedy for the harm, injury or damage done to body, property, reputation, relationship or business, you are advised to contact: Akintunde Esan or the Law Firm of Ase Olodumare Chambers via the contacts on this Blog: Akintunde Esan’s Legal Illumination.  LEGAL REMEDIES FOR INJURIES TO BODY, PROPERTY, REPUTATION, BUSINESS OR RELATIONSHIP IN NIGERIA is a legal illumination of AKINTUNDE ESAN known as The LEGAL ADVISER ONLINE. Akintunde Esan is the Managing Partner & Principal Consultant @ ASE OLODUMARE CHAMBERS (Legal Practitioners/Consultants & Chartered Mediators)

THE LAW ON COMMON DISPUTES BETWEEN BANKS AND THEIR CUSTOMERS IN NIGERIA

INTRODUCTION

Disputes between Bankers and their customers, whether savers or borrowers are inevitable like in any other commercial contractual transactions, due to risk factors which are not the focus of this Legal Illumination. Some of these disputes will of course be resolved at customer care desks or via emails or phone calls, while some will end up in the court of law for adjudication.

Bank customers as well as Bankers in Nigeria have lost billions of naira as result of engaging Lawyers who lack depth in Banks and Customers dispute jurisprudence. Thus, the focus of this edition of Akintunde Esan's Legal Illumination is on Nigerian jurisprudence on some of the issues of disputes  between Banks and their Customers in Nigeria.

A. BANKER AND CUSTOMER RELATION
 

1. Banker and Customer Contract
 

The relationship that exists between a banker and customer is one founded on a banker and customer contract with special usage peculiar with monetary or commercial transactions. It involves the use of special documents and terms such as collaterals, mortgages and debentures. I.O.M Nwoye & Sons Ltd v. C.C.B Plc. (1993) 8 NWLR (Pt. 310) 210. 
 

2. Status of Banker and Customer Relationship on Credit Balance
 

The relationship of a banker and customer is contractual. It is essentially that of a debtor to a creditor, in the case of credit balances. The bank undertakes to receive money and to collect bills for its customer's account. The proceeds so received are not to be held in trust for the customer, but the bank borrows the proceeds and undertakes to repay them. The customer on his part undertakes to exercise reasonable care in executing his written orders so as not to mislead the bank or to facilitate forgery. See: Atkin L.J. in Joachimson v. Swiss Bank Corp. (1921) 3 K.B. 110 at 127; Purification Techniques (Nig.) Ltd. v. Attorney General of Lagos State (2004) LPELR-7424(CA) 23-24, paras. F-F, per Galadima, J.C.A 
 

3. Status of Monies Standing to the Credit of Customer in Bank’s Account
 

Given the nature of the relationship between banker and customer and of the contract that exists between them. The customer has neither the 'custody' nor 'the control' of monies standing in his credit in an account with the banker. What the customer possesses is a contractual right to demand repayment of such monies. There is no issue of customer’s property in the credit balance of a bank account. See: Hirschhorn v. Evans (1938) 3 All E.R. 491; Joachimson v. Swiss Bank Corp. (supra); Foey v. Hill (1882) 2 HL Cas. 28; Yesufu v. A.C.B. (1981) 1 SC 74, (1981) 12 NSCC 36; Balogun v. N.B.N. (1978) 3 SC 155; (1978) 12 NSCC 36.

4. The Status of the Monies of Judgment Debtor Customer with Garnishee Banker
 

Monies in the hands of garnishee banker are not 'in custody or under the control' of the judgment debtor customer. Such monies remain the property in the custody and control of the banker; and payable to the judgment debtor until a demand is made. Hence, Order VIII rule 2(b) of the Judgments (Enforcement) Rules takes care of this by providing that 'garnishee proceedings may be taken where the debt is not yet payable in any court in which the judgment debtor could have sued the garnishee as aforesaid if the debt had been immediately payable. Purification Techniques (Nig.) Ltd. v. Attorney General of Lagos State (2004) LPELR-7424(CA) 24-25, paras. F-G, per Galadima 
 

B. TITLE DOCUMENT DEPOSITED AS COLLATERAL 
 

1. Deposit of Customer’s Title Document
 

Where a customer’s title document is deposited as collateral and the bank refused to grant the loan, the bank is under an obligation to return the tittle deed. If the bank retains it, it shall be liable to pay damages to the customers for wrongful detention. Royal Petroleum Co. Ltd. v. F.B.N Ltd. (1997) 6 NWLR (Pt. 510) 584.
 

2. Loss of Customer’s Title Document
 

The loss of the title document of a customer in the custody of a bank could give rise to tort of detinue or conversion. In an action for detinue, a customer can claim for specific restitution of the chattel, or in default, it value and damages for it detention up to the date of judgment. However, where the chattel is not profit-earning, it is extremely difficult to access the damages incurred by the customer. NEKA v. ACB (2004) 3 MJSC 118 at 152, B-C, per Uwaifo, JSC.
 

3. Court Order on Return of Customer’s Title Document
 

Where a mortgage deed has not been tendered in evidence or where there is evidence that the customer is still indebted to the Bank, it is improper for a court to order the Bank to return the title deed to the customer. U.B.N. v. Emole (2002) 1 MJSC 126 at 141, paras. B-C, per Ogundare JSC.
 

C. LIABILITY OF BANKS
 

1. Liability of Banks for Tort of Negligence
 

The basis of liability of a Banker for tort of negligence is the failure of the banker to exercise reasonable care and diligence to process cheque before payment. Ndoma-Egba v. ACB Plc (2005) 10 MJSC 93 at 131, paras. C-A
 

2. Vicarious Liability
 

A bank is vicariously liable for the fraud committed by its employee by tampering with the bank customer’s account.. U.B.A. Plc v. Okoro (2002) 10 NWLR (Pt. 774) 1

3. Refund of Customer’s Money

A bank is duty bound to refund customer’s money on failing to remit it as instructed by the customer. UBN v. Umeoduagu (2004) 11 MJSC 127 AT 145, paras. A-B, per Edozie,JSC
 

D. LOAN AND OVERDRAFT FACILITIES
 

1. The Difference between a Loan and an Overdraft Facility
 

A customer may borrow from a banker by way of loan or by way of overdraft. A loan is a matter of special agreement. An overdraft facility is not a loan in the sum approved which may be withdrawn at once and which is to be debited against the customer’s account. Rather, it is a credit facility to be enjoyed by the customer to the tune of the amount approved as the customer wishes.

In the absence of an agreement, express or implied from a course of business, bankers are not bound to allow their customers to overdraw their account. An agreement for overdraft must be supported by good consideration and it may be expressed or implied.  Halsbury’s Law of England (4 ed.)Volume 3, Page 115, paragraph 155; Bank of the North Ltd v. Bernand (1976 - 1984) 3 NBLR 104 at 109, paras. J-C
 

2. Application for Overdraft Facility
 

An application by a customer for overdraft or loan facilities from a bank is mere declaration of willingness to enter into negotiation with a view to entering into a contract. It cannot therefore constitute an offer, but at best an invitation to treat. Orient Bank of Nig. Plc v. Bilante International Ltd. (1997) 8 NWLR (Pt. 515) 37;Omega Bank (Nig.) Plc v. O.B.C Ltd. (2005) 8 NWLR (Pt. 928), 547 at 583, paras. D-E
 

3. Overdrawing a Bank Account
 

In the absence of fraud or any other criminal act, the act of overdrawing a bank account cannot give rise to a criminal liability.If a customer draws a cheque for a sum in excess of the amount standing to the credit of his current account, it is really a request for a loan.Afribank (Nig.) Plc v. Onyima (2004) 2 NWLR (Pt. 858) 654; Cooperative Bank Ltd. v. Otaigbe (1976-1984) NBLR 587(HC)
 

4. Letters of Credit
 

Conditions stated for opening letters of credit are binding on the bank and the customer respectively. Jeric Ltd v. Union Bank Plc (2000) 12 KLR (Pt. 112) 3205.
 

E. DEBT RECOVERY
 

1. Methods of Answering an Allegation of Indebtedness.
 

There are four probable methods of answering an allegation of indebtedness, these are:

i. To admit the debt

ii. To deny the debt

iii. To counter-claim against the debt

iv. To set off against the debt.

Air Via Ltd. v. Oriental Airline Ltd (2004) All FWLR (Pt. 212) 156 at 1582-1583,paras. H-A ,per Onu, JSC 
 

2. Admission of Indebtedness
 

Once a defendant admits indebtedness or the receipt of a loan, the burden as to repayment or as to the reason for non-payment, is on the defendant. Okoli v. Morecab Finance (Nig.) Ltd (2007) 14 NWLR (Pt. 1053) 37 at 71 paras D-E.
 

3. Demand Notice or Letter for Payment of Debt
 

As a general rule, in an action for recovery of debt, the cause of action accrues upon demand for the payment of debt, if no demand is made, a cause of action does not arise and no action can be commenced. Kolo v. First Bank of Nig. Plc (2003) 3 NWLR (Pt. 806) 216.
 

The demand notice or letter for payment of debt must be signed by the company with its common seal and not by an Agent or Solicitor.Tate Industries Plc v. Devcom Ltd (2004) 17 NWLR (Pt. 901) 182 at 220; Section 409(a)CAMA .
 

It is an implied term in the relationship between a banker and its customer that, there should be no right of action for the payment of an overdraft until there has been a demand or notice given. Accordingly, no cause of action can arise in this type of transaction except and until there is a demand or notice given. Wema Bank Plc. v. Osilaru (2008) 10 NWLR (Pt. 1094)150 at 178 -179, paras. H-A
 

Be that as it may, it has been held that, where there is an expiry date for any credit facility in an agreement evidencing same, a written demand for payment to the debtor may be dispensed with after the said expiry date. However, the position with the surety is different in that, there should be a written demand on him depending on the terms of the suretyship or guarantee. Integrated Dimensional Systems (I.D.S) & 2 Ors. v. A.I.B Ltd (2002) 4 NWLR (Pt.758) 660
 

4. Oral Evidence of Debt
 

Oral evidence adduced in proof of a party’s indebtedness which is not contradicted, is sufficient to ground a claim for debt, even if documentary evidence such as a statement of account adduced in proof of the debt is rejected by the court or in the case. Trade Bank Plc. v. Chami (2003) 13 NWLR (Pt. 836) 158 at 218, paras. D-A.
 

5. Debt Collection by Police and other Law Enforcement Agent
 

It is settled law that, the police force as well as other law enforcement agents and institutions entrusted with the security of the nation and its people is/are no debt collector and should never be involved in such services. Law enforcement agents including the Police cannot be engaged for settlement of private or civil dispute like the collection of debts and enforcement of contract agreements. See Abdullahi v. Buhari (2004) 17 NWLR (Pt. 902) 278 at 303 para. A; Afribank (Nig) Plc v. Onyima (2004) 2 NWLR (Pt. 858) 654 at 679-680, paras. H-A 
 

6. Serious and Reasonable Debt Payment Proposal 
 

On the issue of the need for a bank debtor-customer to make serious and reasonable debt payment proposal as a gesture of good faith of intention to settle his indebtedness to his bank, the Supreme Court per Mohammed JSC, held in the case of Echaka Cattle Ranch Ltd. v. N.A.C Bank Ltd (1998) 3 KLR (Pt.59) 471 at 482, paras. E-G as follows:

“It is crystal clear that the appellant had not made any serious and reasonable proposal for the payment of what had already fallen due for payment of the loan the company received from the respondent. For how could one who is to pay N3,644,789.70 offer to make a down payment of N 50,000.00 only and payment shall be within two months of the date. Mr. Morphy wrote the letter of proposal for settlement and how could the Company be acting in good faith if it asks for rescheduling of its loan for 20 years ”
 

F. BANK RATES
 

1. Bank Rates issued by the Central Bank of Nigeria 
 

It has been held that, bank rate issued in circulars by the Central Bank of Nigeria is not a matter the court can take judicial notice of. However, it is a well known fact which the Supreme Court takes judicial notice of that interest rates are dependent on the policy of the Central Bank.No interest rate is static. It is not immutable. It varies depending on the nature of Government policy which follows the state of the economy. Daniel Holdings Ltd v. United Bank for Africa Plc (2005) 5 SC (Pt.II) 18 ; Kwajaffa & Ors. v. Bank of the North (2004) 8 MJSC 106 at 135, paras. B-C, per Pats-Acholonu; Section 15 Banking Act.
 

Where the terms of the agreement between the Bank and its customer are clear with regards to the agreed rate of interest and there is no provision for variations, the Banker cannot vary the agreed interest rate to accord with the guidelines of the Central Bank on interest rate. N.B.N Ltd v. A.T. Engineering Co. Ltd. (2006) 16 NWLR (Pt. 1005) 210
 

2. Compound Interest:
 

A bank has the power to charge compound interest on loans or other advances granted to a customer even where there was no express agreement on the rate of interest to be charged. This is because the customer is taken to impliedly consent to an interest to be charged to his account. Adetoro v. Union Bank Nig Plc (2008) 13 NWLR (Pt. 1104) 255 at 296, paras. D-E
 

3. Interest on Overdraft
 

Although, banks can continue to charge interest on any unliquidated loan or overdraft until the customer pays up, this is not absolute. Where there is a fixed expiry date for an overdraft, the agreed interest rate will only be applicable from the date the agreement came into effect up to the date the facility expired. I.D.S Ltd v. A.I.B Ltd (2002) 4 NWLR (Pt. 785) 660 ; United Bank for Africa Plc v. Lawal (2008)7 NWLR (Pt. 1087) 613 at 633, paras. B-E.
 

4. Pre and Post Judgment Interests
 

Banks are entitled to pre-judgment interest on debts as of right, while post-judgment interest is governed by statute. I.D.S Ltd v. A.I.B Ltd (supra)

G. EXCESS AND ILLEGAL BANK CHARGES
 

1. Claims for Refund of Excess or Illegal Bank Charges

Claim by bank customers for the refund of excess charges and/or illegal charges debited to their accounts by their Banks is rampant these days in court. A bank customer has the right to refund of bank charges not duly charged in line with the provisions of Central Bank of Nigeria “Guide to Bank Charges” The claims for refund of excess or illegal charges may include the following:

(a) Excess commission on turnover (COT)

(b) Excess overdraft Interest

(c) Excess loan interest

(d) Excess property search fee

(e) Illegal facility fee

(f) Illegal returned cheque fee

(g) Excess statement charge

(h) Illegal pre-disbursement fee

(i) Excess management fee

(j) Excess debenture search on company

(k) Excess cost on debenture charge

(l) Illegal CRC charge

(m) Illegal Solicitor’s fee

(n) Illegal credit Registry profile search fee

(o) Excess access online charge:

(p) Spurious withdrawals

(q) Interest not at prevailing CBNMRR/MPR

H. FOREIGN CURRENCY
 

1. Devaluation of Foreign Currency 
 

In a banker and customer relationship, the onus of proving how devaluation of foreign currency affected transactions between the banker and the customer, and that the banker is entitled to charge the customer with such devaluation lies on the banker as such facts are specially within his knowledge. UBN v. Emole (2002) 1 MJSC 126 at 137, para. G, per Ogundare, JSC.
 

I. DEED OF LEGAL MORTGAGE
 

1. The terms of the grant of a loan or overdraft facilities secured by a legal mortgage would be governed by the legal mortgage. Aderemi Isaiah Adegbola & Ors. v. UBA Plc. (2005)11 CLRN 111, per Rowland, JCA.
 

J. STATEMENT OF ACCOUNT
 

1. Relevant but not Sufficient Evidence
 

A bank statement of account is not sufficient explanation of debit and lodgments in a customer’s account to charge the customer with liability for the overall debit balance shown in the statement of account. Any bank which is claiming a sum of money on the basis of the overall debit balance of a statement of account must adduce both documentary and oral evidence to show how the overall overdraft balance was arrived at. Habib Nig. Bank Ltd. v. Gifts Unique Nig. (2004) 15 NWLR (Pt. 896) 405; Wema Bank Plc. v. Osilaru (2008) 8 CLRN 89 at 109, lines 20-5; 10 NWLR (Pt. 1094) 150.
 

2. Periodic Statement of Account
 

In a bank and customer relationship, it is the duty of the banker to send statements of account to the customer at regular interval as may be agreed upon by the parties. Hoston (Nig.) Ltd v. A.C.B. Plc (2002) 11 NSCQLR 195 at 214, per Ogundare, JSC.
 

Where a bank customer receives periodic statements of account and did not dispute the account as shown on the statements, the customer is deemed to have accepted same as correct. Thor v. FCMB (2005) 14 NWLR (Pt. 946) 697.
 

3. Debit Balance
 

Where a claim or defence or counter claim of a party is based on the debit balance in a statement of account, in order to succeed, such a party need to prove how the debit balance was arrived at. Anyakwo v. A.C.B (3) (1976) 2 SC at 62-64, per Fatai Williams,JSC ; (1976) NCLR 118 at 127.
 

4. Banker Consolidating the Accounts Owned by a Customer 
 

There is no doubt in law that a banker may consolidate the accounts owned by a customer in his own right, unless precluded by agreement, express or implied from the course of business from doing so, in order to ascertain and treat as the balance, the amount standing to the credit of the customer. It is a prudent way open to the banker to assess the financial worth of a customer. It is a different thing where a banker opens two accounts for a customer one in the customer's own name and the other in a business name or in the name of an incorporated body under his aegis or control. Joe v. Co-operative Bank (2003) 4 MJSC 171 at 187, paras. F-G , per Uwaifo, JSC.
 

5. Proof of Payment of Money into Bank  Account
 

Proof of payment of money into a bank may be proved either by the oral evidence of the person who made the payment personally to the bank or by the production of bank tellers or acknowledgement showing on the face of it that the bank had received the payment. First Bank Nigeria Plc v. Mainasara (2006) 2 NWLR (Pt. 909 ) 42.

K. BANK CHEQUES
 

1. The Obligation of Bank to Honour Customer’s Cheques 
 

A bank is bound to pay cheques drawn on it by a customer in legal form, provided, the bank has in its hands at the time sufficient and available funds for the purposes, or provided the cheques are within the limits of an agreed overdraft. It needs be emphasized that, there must be sufficient funds to cover the whole amount of the cheque presented. In the absence of special arrangement, there is, as a general rule, no obligation on the banker to pay any part of a cheque for an amount exceeding the available balance. The bank only contracts with the customer to honour cheques when he has “sufficient” and available” funds in hand. First African Trust Bank Ltd. v. Partnership Investment C. Ltd (2004) 2 MJSC 101 at 126 – 127, paras. G-A, per Iguh, JSC. 
 

2. Forged or Unauthorized Cheques
 

Under Section 24 of the Bill of Exchange Act 1882, a forged or an unauthorized cheque is inoperative. Ndoma-Egba v. ACB Plc (2005) 10 MJSC 93 at 133, para. A.
 

3. The issuance of a Dud Cheque
 

The issuance of a dud cheque is a crime and is punishable under the Dishonoured Cheques (Offences) Act with two-year jail term upon conviction. In the case of Fajemirokun v. Commercial Bank Nigeria Ltd. & Anor (2009) 2 NMLR 287, Tabai J.S.C, at page 299, para. 30, illuminated on the issuance of dud cheque in Nigeria thus:

"In the first place issuance of Dud Cheques is a criminal offence under Section 1 of the Dishonoured Cheques (Offences) Act Cap D11 Laws of the Federation of Nigeria 2004 and for which the Respondents were entitled to make a report to the Police."
 

4. Proving of the Offence of Issuing Dud Cheque
 

The prosecution in order to secure a conviction for the issuance of a dud cheque has the duty to prove:

a. That the accused obtained credit by him or herself

b. That the cheque was presented within three months of the date thereon; and

c. That on presentation the cheque was dishonoured on the ground that there was no sufficient funds standing to the credit of the drawer of the cheque in the bank on which the cheque was drawn

See Abeke v. State (2007) 9 NWLR (Pt. 1040) 411 at 429 -430, paras. G-B, per Tobi, JSC; Section 1 (i)(b) Dishonoured Cheques (Offences) Act Cap D11 Laws of the Federation of Nigeria 2004
 

L . JURISDICTION
 

1. Concurrent Jurisdiction
 

The Federal High Court has concurrent jurisdiction with the state High Courts in transactions involving an individual customer and his bank. FCMB v. NDIC (1999)2 NWLR (Pt. 591)333; NDIC v. Okem Enterprises Ltd (2004)7 MJSC 74,130 – 131, paras. D-A, per Kutigi ,JSC; Section 251 (1)(d) 1999 Constitution.
 

2. Exclusive Jurisdiction
 

An issue of banking that is not one of bank customer relationship should be squarely before the Federal High Court. Societe Bancaire Ltd v. Salvado De Lluch (2005) 1 MJSC 187 AT 201 -202, paras. G-E; Section 251 (1)(d) 1999 Constitution.
 

3. Dispute Between Two Banks
 

Where there is a dispute between two banks, the forum for resolution is not exclusive to the Federal High Court.The nature of the transaction and the capacity in which one of the banks related with the other shall determine the proper forum. FMBN v. NDIC (1999)2 NWLR (Pt. 591) 333 (SC)
 

M. JUDGMENT 
 

1. Stay of Execution of Money Judgment
 

Preservation of the res (judgment debt or money judgment) which is the corner-stone of application for stay of execution will be meaningless or defeated if the res is preserved in the hands of the judgment debtor on the sole ground that, he or she or it is rich. It will also amount to a glaring case of depriving a successful litigant of the fruits of the judgment. U.B.N. Ltd. v. Odusote Bookstore Ltd (1994)3 NWLR (Pt. 331) 129 at 152, paras. A-B.
 

The Court of Appeal in the case of Owena Bank (Nig.) Plc v. O.B.C. Ltd. (1998) 9 NWLR (Pt. 564) 129 at page 137, paras D-C, held that the decision in the case of Union Bank of Nigeria Plc v. Odusote (supra) was not meant to stifle the exercise of discretion by the Court and that the case was decided on the circumstances and peculiar facts of the case. Thus, the exercise must be based on the peculiar nature and circumstances of each case.

CONCLUSION
 

Banks' company secretaries/legal advisers in order to minimise losses suffered by banks in debt recovery cases in Nigeria are advised to engage lawyers with depth in commercial as well as bank and customer disputes.

In addition, in-house solicitors of banks should be legally knowledgeable enough to request for the legally required accounting evidence from their accounting departments.

Finally, bank customers who are not satisfied or convinced with the status of their account with their banks need to engage experienced accounting consultants to audit such accounts before engaging the services of a sound and experienced lawyer in bank and customer dispute litigations.

Akintunde Esan, Legal Practitioner/Consultant and Chartered Mediator - Managing Partner, Ase Olodumare Chambers, Lagos, Nigeria.
 

If you need further legal illuminations on any dispute with your Bank in Nigeria, you are advised to contact Akintunde Esan

THE LAW ON COMMON DISPUTES BETWEEN BANKS AND THEIR CUSTOMERS IN NIGERIA is a legal illumination of AKINTUNDE ESAN known as The LEGAL ADVISER ONLINE. Akintunde Esan is the Managing Partner & Principal Consultant @ ASE OLODUMARE CHAMBERS (Legal Practitioners/Consultants & Chartered Mediators)

MARITIME LAW: MAKING ENFORCEABLE MARITIME CLAIMS IN NIGERIA

A. Introduction

Commercial shipping is the business of transporting goods and persons by sea. The focus of this edition of Akintunde Esan’s Legal Illuminations is the making and settlement of enforceable maritime claims arising from maritime disputes in the course of the business of transportation of goods and persons by sea in Nigeria.

B. Maritime Claims

The legal framework regulating the carriage of persons and goods by sea is known as maritime law, also termed admiralty law. In the Black’s Law Dictionary 7th Edition at page 982, Maritime law is defined as

“The body of law governing marine commence and navigation, the transportation at sea of persons and property, and marine affairs in general; the rules governing contract, tort, and workers’ – compensation claims arising out of commerce on or over water.”

Given the above definition of maritime law, we can conclude that, maritime claims are demands for contractual or statutory entitlements in transactions arising from marine commence and navigation, the transportation at sea of persons and property, and marine affairs in general. It includes demands for compensation for torts arising out of commerce on or over water.

In Nigerian maritime jurisprudence, the maritime claims that are enforceable in the Federal High Court - which is the Nigerian Court of law given the exclusive the jurisdiction by the Constitution to hear and determine any question relating to any maritime claim - are classified into two categories namely: proprietary maritime claim and general maritime claim. See Section 2 of the Admiralty Jurisdiction Act,1991.

1. Proprietary Maritime Claim

Proprietary maritime claim is a reference to

a) a claim relating to-

i. the possession of a ship;

ii. the possession of a ship;

iii. a title to or ownership of a ship or of a share in a ship;

iv. a mortgage of a ship or of a share in a ship; or

v. a mortgage of a ship's freight;

b) a claim between co-owners of a ship relating to the possession, ownership, operation or earning of a ship;

c) a claim for the satisfaction or enforcement of a judgment given by the Court or any court (including a court of a foreign country) against a ship or other property in an admiralty proceeding in rem;

d) a claim for interest in respect of a claim referred to in paragraphs (a), (b) or (c) above.

2. General Maritime Claim

A general maritime claim relates to a claim that involves:

a) collision claims;

b) damage to a ship;

c) loss of life or personal injury caused by a ship;

d) loss of or damage to goods carried by a ship;

e) claims arising from agreements for carriage of goods or persons by a ship or for the use or hire of a ship;

f) salvage claims;

g) general average claims;

h) pilotage;

i) towage of a ship or water-borne aircraft;

j) goods supplied or to be supplied to a ship;

k) claims in respect of the construction of a ship;

l) claims for alteration, repair or equipping of a ship;

m) claims for port charges or dues;

n) a claim arising out of bottomry;

o) claim for disbursement on account of a ship;

p) claims for insurance premiums due on a ship or its cargo

q) claims for wages of crewmen;

r) claims for forfeiture or condemnation of a ship or goods carried thereon;

s) claims for enforcement of arbitral awards in proprietary maritime claims; and

t) claims for interest in any proprietary maritime claim.

C. How to make Maritime Claims

By virtue of Section 5 of the Admiralty Jurisdiction Act, maritime claims may be made by an action in personam or an action in rem.

1. Actions in Personam:

An action in personam is an action against individuals who may be carriers, owners, charterers, managers and operators of ships. Defining the expression “action in personam”, Coker JSC, in Nigerian Port Authority v. Panalpina (1973) 5 SC at pp. 96-97; ANLR 408, 422 illuminated thus:

“Etymologically an action in personam is an action brought against a person, an action to compel him to do or not to do a particular thing or take or not to take a particular course of action or inaction. Actions for damages in tort or breaches of contract are clearly directed against the person as opposed to actions which are brought for the purpose of declaring or challenging a status, like proceedings under the matrimonial laws of the country or legitimacy or admiralty action directed against a ship or the res (and so know as an action in rem) or the like. Generally therefore, all actions which are aimed at the person requiring him to do or not to do or take or not to take an action or course of conduct must be and are actions in personam”

It should be noted that, as a matter of principle of law, the fact that, a Judgment was obtained in an action in personam, does not mean that, it is not enforceable against the assets of the defendant sued irrespective of the nature of the claim. See M.V Zack Metal Co. v. International Navigation Corporation (1975) A.M.C. 720.

Similarly, depending on the circumstances of a case, a claim or liability in personam could be pursued through an action in rem. In the case of Schiffahrskontor v. Rivway Ltd. (1998) 4 KLR (Pt. 61)769 at 792,paras. B-C, Mohammed JSC held that:

“The appellants’ liability in personam could be pursued through an action in rem against the ship or its owners, agent, hirer or charterer. Since the vessels on account of which the disbursement were made are no longer available within the jurisdiction of the Federal High Court for the respondents to have proceeded against them, the respondents are therefore right under the law to proceed in an action in personam against the appellant who authorized the disbursement and I agree that the action can be enforced through a proceeding in rem.”

2. Actions in Rem

An action in rem is an action against the ship or vessel. In Anchor Ltd v. The Owner of Ship ELENI 1 PSC 14,15; Nigerian Shipping cases Vol. 1 at page 42 Foster Sutton, FCJ defined “action in rem” as follows:

“An action in rem is one in which the subject-matter is itself sought to be affected, and in which the claimant is enabled to arrest the ship or other property and to have it detained until his claim has been adjudicated upon or until security by bail has been given for the amount or for the value of the property proceeded against where that is less than the amount of the claim.”

Though, generally, under the Admiralty Jurisdiction Act, an action in personam may be brought in the Federal High Court in all cases within the admiralty jurisdiction of the Court, there are however some claims which the Act provides that, they “may” be brought in rem, these claims include the following:

a) claims for possession, ownership, mortgage of a ship or of any share in a ship;

b) claims for damage done by a ship either by collision or otherwise;

c) claims between co-owners relating to the possession, ownership, operation or earning of a ship;

d) claims for the enforcement of a maritime lien or other charge on a ship relating to:

i. salvage

ii. damage done by a ship

iii. crew members wages

iv. masters disbursements

e) claims brought under Section 2 of the Admiralty Act in which the relevant person was the owner, charterer or in possession or control of the ship or a related ship when the cause of action arose;

f) claims for port, harbour, canal or light toll charges or dues; and

g) claims resulting from loss or damage to goods.

Though, a judgment obtained in an action in rem provides no basis for imposing personal liability on the ship-owner who has not appeared to defend the action nor does it attach to any of his other ships. See M.V Zack Metal Co. v. International Navigation Corporation (supra).

However, a judgment in an action in rem does not preclude the claimant from bringing a subsequent claim in personam against the owner of the vessel in the same claim where the proceeds of sale of the res are insufficient to cover the damages awarded in the rem action. See: Nelson v Crouch (1863) L.J.C.P 46 at 48; The John and Mary (1859) S.W.A 471.

D. Limitation periods for Making Maritime Claims

1. Under the Admiralty Jurisdiction Act

The limitation period for making a maritime claim or on a claim on a maritime lien or other charge is the limitation period that would have been applicable to the claim if the claim had been made otherwise than under Admiralty Jurisdiction Act, which would imply the application of other laws which prescribes a limitation period such as the Hague Rules applicable in Nigeria by the Carriage of Goods by Sea Act, which prescribed a limitation period of one year for certain classes of claims and the Merchant Shipping Act which prescribe a two year period for claims involving salvage. However, if no such claim could have been so made, a period of three years after the cause of action arose.

The general rule on statutory interpretation is that the provisions of a specific enactment overrides the provisions of general enactment on the subject. This would imply that, the provisions of the Admiralty Jurisdiction Act takes precedence over statutes with general application.

It is noteworthy that, under the Admiralty Jurisdiction Act, statutes with specific application of limitation period on a claim - the limitation period fixed in relation to maritime claim by any enactment or law - takes precedence over the limitation prescribed by the Act. See Section 18 (2) Admiralty Jurisdiction Act.

2. Limitation Act 1966

The Limitation Act provides that, actions including actions founded on simple contract or recovery of any sum, brought to court after the expiration of six years from the date of which the cause of action accrued are statute bared, thus unenforceable. Section 7 (1)(a) and (e).

The general restriction limiting the time within which actions founded on contract or tort must be brought does not apply to any cause of action within the Admiralty jurisdiction of the Federal High Court which is enforceable in rem except an action to recover a seaman’s wages. See Section 7(3); Schiffahrskontor v. Rivway Ltd. (1998) 4 KLR (Pt. 61)769 at 789, para. H, per Ogwuegbu JSC.

E. Jurisdiction

1. The Federal High Court

The Federal High Court as said earlier is the only court in Nigerian exclusively vested with the jurisdiction to hear and determine maritime claims and other admiralty causes or matters, whether civil or criminal See Section 251(1)(G) of the 1999 Constitution; Section 7(I)(g) Federal High Court Act, 1973; Section 3 Admiralty Jurisdiction Act, 1991.

2. Foreign Jurisdictional Clause

A foreign Jurisdictional clause is an ouster clause in a maritime contract agreement, which ousts the jurisdiction of the Court in Nigeria to entertain or hear any dispute on a maritime claim but, vests the jurisdiction in a foreign court. In Nigerian maritime jurisprudence, a foreign Jurisdictional clause is not enforceable by virtue of Section 20 of the Admiralty Jurisdiction Act.

Section 20 (supra) categorically provides that, any agreement by any person or party to any cause, matter or action, which seeks to oust the jurisdiction of the Federal High Court in Nigeria, is null and void, if it relates to - any of the maritime claims discussed in this legal Illumination or - matter falling under Admiralty Jurisdiction Act and if—

(a) the place of performance, execution, delivery, act or default is or takes place in Nigeria; or

(b) any of the parties resides or has resided in Nigeria; or

(c) the payment under the agreement (implied or express) is made or is to be made in Nigeria; or

(d) in any admiralty action or in the case of a maritime lien, the plaintiff submits to the jurisdiction of the Court and makes a declaration to that effect or the rem is within Nigerian jurisdiction; or

(e) it is a case in which the Federal Government or the Government of a State of the Federation is involved and the Federal Government or Government of the State submits to the jurisdiction of the Court; or

(f) there is a financial consideration accruing in, derived from, brought into or received in Nigeria in respect of any matter under the admiralty jurisdiction of the Court; or

(g) under any convention, for the time being in force to which Nigeria is a party, the national court of a contracting State is either mandated or has a discretion to assume jurisdiction; or

(h) in the opinion of the Court, the cause, matter or action should be adjudicated upon in Nigeria.

In the case of JFS Investment Ltd. v. Brawal Line Ltd. & Ors. (2010) 7-12 KLR (Pt. 286) 2611, per Adekeye, JSC reaffirmed at page 2633, para. D, that, Section 20 of the Admiralty Jurisdiction Act 1991 has virtually removed the element of court’s discretion in deciding whether to uphold a foreign jurisdictional clause.

F. Conclusion

In making maritime claims, it is instructive to bear in mind that, some of these claims are subject to conventional and statutory limitations. These limitations will be discussed in the next edition of my legal illuminations series on maritime law.

Akintunde Esan, Legal Practitioner/Consultant, Chartered Mediator and Legal Blogger- Managing Partner at Ase Olodumare Chambers.

The above legal illuminations are not a substitute for legal advice. You are advised to contact Akintunde Esan for further illuminations

MARITIME LAW: MAKING  ENFORCEABLE MARITIME CLAIMS IN NIGERIA

 is a legal illumination of AKINTUNDE ESAN known as The LEGAL ADVISER ONLINE. Akintunde Esan is the Managing Partner & Principal Consultant @ ASE OLODUMARE CHAMBERS (Legal Practitioners/Consultants & Chartered Mediators)

AVIATION LAW: REMEDIES FOR DELAYED,DAMAGED OR LOST BAGGAGE /COMPENSATION FOR DEATH OR INJURY OF AIRLINE PASSENGERS IN NIGERIA

Introduction

In the course of carriage of persons, baggage and cargoes by airline carriers, the delay, damage or loss of baggage and cargoes and sometimes loss of lives or personal injuries do occur due to human omissions or commissions, natural factors and accidents. This edition of Akintunde Esan’s Legal Illuminations is focused on the on the international and domestic laws governing the rights and liabilities of airline carriers, passengers, consignors and consignees in Nigeria in the context of remedies for delayed, damaged or lost baggage and compensation for death or injury of airline passengers in Nigeria.

A. Legal Framework

Aviation Law is body of international and domestic laws governing various aspects of civil aviation.

1. International Conventions

The rights and liabilities of airline/carriers, passengers, consignors and consignees in Nigeria are regulated by International Conventions. These Conventions have as their objective the unification of certain rules relating to International Carriage by air in order to ensure uniform standard, the orderly development of international air transport operations and the smooth flow of passengers, baggage and cargo in accordance with the principles and objectives of the Convention on International Civil Aviation. The ultimate purpose and intention of these Conventions is to remove those actions governed by them from the uncertainty of the domestic laws of the member States. Thus, all countries that are signatories apply them without recourse to their respective domestic Laws. See Cameroon Airlines v. Otutuizu (2011) 4 NWLR (Pt. 1238) 512, per Rhodes-Vivour, JSC

a. Warsaw Convention 1929

The Convention for the Unification of Certain Rules Relating to International Carriage by Air 1929 commonly known as the Warsaw Convention as amended by the Hague Protocol 1955 is an international convention which regulated liability for international carriage of persons, luggage, or goods performed by aircraft for reward. It was signed in Warsaw on 12 October 1929, and became effective on 13 February 1933.

b. Montreal Convention 1999

The Montreal Convention (formally, the Convention for the Unification of certain rules relating to International Carriage by Air). It is also termed the Agreement Relating to Liability Limitation of the Warsaw Convention and Hague Protocol. The Convention is a multilateral treaty adopted by a diplomatic meeting of the International Civil Aviation Organisation (ICAO) member states at Montreal on 28th May, 1999. By September 5, 2003 , the Montreal Convention was ratified by 31 states including Nigeria. It became effective on November 4, 2003.

The Convention retained the core provisions of the Warsaw Convention , it however, reviewed upward the limitation on liability for death and personal injury cases, waived the airlines’ due care defences and made the carrier’s liability an absolute liability in the absence of passenger’s negligence.

2. Domestic Applications of International Aviation Laws

The International treaties particularly the Warsaw and Montreal Conventions which govern the rights and liabilities of airline/carriers, passengers, consignors and consignees have been domesticated in Nigeria and made applicable to both international and non-international air carriage contracts.

a. Carriage by Air (Colonies, Protectorates and Trust Territories) Order, 1953

The Warsaw Convention was domesticated as a Nigerian Law by the Carriage by Air (Colonies, Protectorates and Trust Territories) Order, 1953, Vol. XI Laws of the Federation 1958. It came into operation on the 1st day of January 1954. This law is no longer part of the existing law in Nigeria contrary to as held in the case Ibidapo v. Lufthansa (1997) 4 NWLR (pt.498) 124 which was held before the commencement of the 2006 Civil Aviation Act, as it has been repealed by Section 77 (1) of the Civil Aviation Act, 2006 which provides that:

“1. Subject to the provisions of subsection (2) of this section, the following enactments are hereby repealed;

a) Carriage by air (Colonies, Territories and other Trust Territories) Colonial Order 1953;

b) Civil Aviation Act, Cap. 51 LFN 1990;

c) Civil Aviation (Amendment) Act, 1999; and

d) )Nigerian Civil Aviation Authority (Establishment) Act, No. 49 1999.

2. All regulations, by‐laws, orders and subsidiary legislation made under the Civil Aviation Act, 1964 Cap. 511. FN 1990) shall continue to be in force until new regulations, by‐laws, orders and subsidiary legislation are made pursuant to this Act.”

While Section 77 (1) Civil Aviation Act, 2006 repealed the Carriage by Air (Colonies, Protectorates and Trust Territories) Order, 1953, Section 48 (1) of the Act made the Montreal Convention applicable to international carriage by air in Nigeria. Section 48 (1) provides as follows:

“The provisions contained in the Convention for the Unification of certain rules relating to International Carriage by Air signed at Montreal on 28th May, 1999 set out in the Second Schedule of this Act and as Amended from time to tune, shall from the commencement of this Act have force of law and apply to international carriage by air to and from Nigeria, in relation to any carriage by air to which those rules apply irrespective of the nationality of the aircraft performing the carriage, and shall, subject to the provisions of this Act, govern the rights and liabilities of carriers, passengers, consignors, consignees and other persons.”

b. Carriage by Air (Non-International Carriage) (Colonies, Protectorates and Trust Territories) Order 1953

The Warsaw Convention was made applicable to non-international carriage/flights in Nigeria by virtue of the Carriage by Air (Non-International Carriage) (Colonies, Protectorates and Trust Territories) Order 1953.See Kabo v. Oladipo (2000) 4 KLR (Pt.102) 1413. However, by virtue of Section 48 (2) of the Civil Aviation Act, 2006 as from the date of commencement of the Act the Montreal Convention shall apply to non-international carriage by air within Nigeria. For ease of reference Section 48 (2) of the Act is reproduced below:

“The provisions contained in the Convention for the Unification of Certain Rules Relating to international Carriage by Air signed at Montreal on 28th May, 1999 has been modified and Set out in the Third Schedule of this Act and as amended from time to time, shall from commencement of this Act have force of law and apply to non‐international carriage by air within Nigeria, irrespective of the nationality of the aircraft performing the carriage and shall subject In the provisions of this Act, govern the rights and liabilities of carriers, passengers, consignors, consignees and other persons.”

c. Civil Aviation Act, 2006

The Montreal Convention was incorporated into Nigerian law by virtue of Section 48 of the Civil Aviation Act, 2006 and from the date of commencement of the Act, the Montreal Convention became the basis for establishing of an airline’s liability for both international and non-international carriages or flights in Nigeria. See Section 48 (1) and (2) Civil Aviation Act, 2006; Emirate Airline v. Tochukwu Aforka & Anor. (2014) LPELR-22686(CA).

It is instructive to note that, the Montreal Convention prevails over any rules, which apply to international carriage, by air including the Warsaw Convention. See Article 55 of the Montreal Convention. In Nigeria, Civil Aviation Act, 2006 domesticated the Montreal Convention by repealing the Carriage by Air (Colonies, Protectorates and Trust Territories) Order, 1953 which domesticated the Warsaw Convention.

The Act also domesticated other international treaties to which Nigeria is a party, including (among others) the Chicago Convention 1944 and the Cape Town Convention 2001.

d. Conflict between International Laws and Domestic Aviation Laws

The Montreal Convention and other Conventions to which Nigeria is a signatory are international treaties, international agreements and compromise principles, which the high contracting States have submitted to be bound by the provisions. They are therefore an autonomous body of law whose terms and provisions are above domestic legislation. Thus, any domestic legislation in conflict with the Conventions is void.

The law is that, where domestic/common law right has been enacted into a statutory provision, it is to the statutory provision that resort must be had for such right and not the domestic/common law. Hence, an air passenger is not at liberty to choose as between the provisions of the convention and the domestic/common law for claims for damages against the carrier. Such claims have to be asserted only in accordance with and subject to the terms and conditions of the convention and cannot be pursued under any other law. Cameroon Airlines v. Abdulkareem (2003) 11 NWLR (pt.830) 1; El Al Israel Airlines Ltd. v. Tseng 919 F. Supp 155 S.D.N.Y. 1996 ; Sidhu v. British Airways (1997) 1 All ER 193; Air France v. Saks 105 S.C. 1338 470 U.S., 392 84 L.Ed 2d 289 (1985).

B. Contract of Carriage by Air

1. Contract between Airline Carriers and Passengers

On the purchase of airline ticket, by a passenger, a contract is established between the passenger and the airline. See: Cameroon Airlines v. Mr. Mike Otutuizu (2011)2 KLR (Pt.291) 373. An airline or carrier of passenger by air is under a duty to deliver a passenger ticket to a passenger which shall contain the following terms or particulars:

a) The place and date of issue;

b) The place and date departure and destination;

c) The agreed stopping places, provided that the carrier or airliner may reserve the right to alter the stopping places, in case of necessity;

d) The name and address of the airline or carrier; and

e) A statement that the carriage is subject to the rules relating to liability established by the Convention.

An airline or carrier is also under a duty to deliver a luggage ticket for luggage other than “hand luggage”.

2. Contract between Consignors and Consignees

Under the Convention, the air waybill or the cargo receipt is prima facie evidence of the conclusion of the contract, of the acceptance of the cargo and of the conditions of carriage mentioned therein. The air waybill or the cargo receipt shall include:

a) an indication of the places of departure and destination;

b) if the places of departure and destination are within the territory of a single State Party, one or more agreed stopping places being within the territory of another State, an indication of at least one such stopping place; and

c) an indication of the weight of the consignment.

3. Breach of Contract of Carriage by Air

a. Alteration of Route

Where the agreed route is altered, it amounts to a breach of contract, unless there is justification for such alteration. In the case of Cameroon Airlines v. Mr. Mike Otutuizu (supra), Mr. Otutuizu desired to travel from Lagos to Manzini, Swaziland on a business trip, he bought two tickets endorsed with the agreed stopping places. The tickets were routed as follows: Exhibit A. The flight shall commence from Lagos, Nigeria, with stops in Doula, Cameroon, and then on to Harare. Zimbabwe. Exhibit B is from Harare to Manzini and back to Harare. Contrary to the agreed route, the airline carried Mr. Otutuizu though South Africa. As he had no visa for South Africa to the knowledge of the airline, he was arrested and detained. His $20,000 was taken by Immigration Officials. He was subsequently deported to Lagos. There was no evidence before court that there was any reason to deviate from the agreed stopping places. The court held that, in the absence of justification for flying to Johannesburg, South Africa, there is a clear breach of contract since Mr. Otutuizu was never flown to Manzini, Swaziland.

The trial court found that breach of contract was established by the respondent who was awarded the sum of N80, 000.00 being the value of the tickets and N500,000:00 general damages but declined to award the sum of $20,000.00 claimed by the respondent. The Court of Appeal confirmed the awards made by the trial court and in its wisdom, awarded the respondent the sum of $20,000:00 as claimed by the passenger. The Supreme Court affirmed the judgment of the High Court as affirmed by the Court of Appeal.

b. A Transit Visa

A transit visa is issued to a passenger by a country through which a plane would fly/land enroute the final destination. Transit visa is not issued by the country in which the passenger's journey terminates. It is true that it is the duty of the passenger to get a transit visa, and it is also the duty of the airline to refuse to take a passenger on board who has not got a transit visa.

Airlines insist on passengers having transit visas, but that only applies if the airline informs the passenger on the stops that would be made before the final destination of the aircraft, (and in effect the passenger). Cameroon Airlines v. Mr. Mike Otutuizu (supra)

C. Liability of Airline Carrier

1. An airline's liability to its passengers or customers could arise as a result of:

a) Injury sustained on board an aircraft or

b) Death arising from the course of a journey or

c) Damage or loss of goods

d) Delayed or denied boarding or

e) Interactions in the course of preparing for or the actual conduct of flight operations.

See Harka Air Services (Nig.) Limited v. Keazor Esq. (2011) 6 KLR (Pt.298) 1771 at 1786,para. A, per Adekeye, J.S.C

2. The Liabilities for the carrier are contained in Articles 17 to 30 of Montreal Convention which is the applicable Convention in Nigeria on the subject of illumination and the subject of the references in this Legal Illumination.

a. Liability for Death or Injury of the Passenger on Board an Aircraft (Articles 17 and 21):

Under the Aviation Law, an aircraft accident is an occurrence associated with the operation of an aircraft which takes place between the time any person boards the aircraft with the intention of flight until such time as all such persons have disembarked in which a person suffers a fatal or serious injury as a result of being in the aircraft. See:Annex 13 to the Chicago Convention, dealing with Aircraft Accident and Incident Investigation and Harka Air Services (Nig.) Limited v. Keazor Esq. (supra) at page 1786, paras. B-C.

Advance Payments: In any case of aircraft accident resulting in death or injury of passengers the carrier shall make advance payments of at least US $30,000.00 (thirty thousand United States Dollars) within 30 (thirty) days from the date of such accident to the natural person or such natural persons who are entitled to claim compensation in order to meet the immediate economic needs of such persons and such advance payments shall not constitute recognition of liability and may be offset against any amounts subsequently paid as damages by the carrier. Section 48 (3) of the Civil Aviation Act, 2006 and Article 28.

The Montreal Convention eliminated the limits of liabilities set in the Warsaw Convention by introducing a two-tiered liability regime in cases of death or injury to the passenger on board an aircraft:

i. In Nigeria, where the claims of the victim does not exceed 100,000 USD, the carrier shall not be able to exclude or limit its liability.

ii. Where the claim exceeds 100,000 USD the liability of the air carrier is unlimited except there is evidence that the death or injury was not as a result of the negligence or wrongful act or omission of the carrier or its agent or was solely due to the negligence or other wrongful act or omission of a third party.

b. Liability for Delay in the Carriage of Persons:

The liability of the carrier to each passenger in respect of damage caused by delay is limited to 4150 USD. (Article 22, Paragraph 1)

c. Liability for Carriage of Baggage:

The liability of the carrier in the case of destruction, loss, damage or delay of baggage is limited to 1000 USD. (Article 22,Paragraph 2)

The liability of the carrier in respect of damage suffered by a passenger caused by delay or destruction, loss, damage or delay of baggage will be unlimited, if it is proved that the damage resulted from an act or omission of the carrier, its servants or agents, done with intent to cause damage or recklessly and with knowledge that damage would probably result; provided that in the case of such act or omission of a servant or agent, it is also proved that such servants or agents was acting within the scope of its employment. Paragraph 5 of Article 22.

d. Liability for Carriage of Cargo:

i.Undeclared Interest:

The liability of the carrier in the case of destruction, loss, damage or delay in the carriage of cargo is limited to 20 USD per kilogram, if the value of the cargo is not declared at the time when the package was handed over to the carrier (Article 22, Paragraph 3)

It is instructive to note that, paragraph 5 of Article 22 of the Montreal Convention excludes paragraph 3, which deals with liability in the case of carriage of cargo. The clear intention to exclude carriage of cargo is confirmed by Article 30 which deals with actions brought against a servant or agent of the carrier, who are also entitled to the limits of liability under the Convention just as the carrier, thus in the case of Emirate Airline v. Tochukwu Aforka & Anor. (2014) LPELR-22686(CA) per Iyizoba, J.C.A. held that “from the exclusion of negligence and willful misconduct in the case of carriage of cargo in article 22 (5) and Article 30 (3) I am of the firm view the Montreal Convention did not intend that those concepts should affect the limitation of liability with respect to carriage of cargo” and held further at pages 28-30, paras. E-C, that, the learned trial Judge was wrong in holding that there was no limitation of liability because the appellant was unable to rebut the presumption of negligence or the doctrine of res ipsa loquitor. Iyizoba, J.C.A. illuminated at pages. 33-34, paras. B-C that:

"The concept of negligence or willful misconduct obviously cannot work in the case of loss of cargo. It is difficult to prove willful misconduct as the Plaintiff is not in a position to know how the loss came about and no help is likely to come from the carrier in that regard. That must be why carriage of cargo was excluded in the provisions. It appears the position may have been different under the Warsaw Convention because there are decided authorities where negligence and willful misconduct were considered in cases of loss of cargo.”

ii. Special Declaration of Interest

The only way to escape the limitation of liability with respect to damage or loss of cargo is where the consignor at the time when the package was handed over to the carrier made a special declaration of interest in delivery at destination and has paid a supplementary sum if the case so requires. In that situation, the carrier will be liable to pay a sum not exceeding the declared sum. Unless it proves that the sum is greater than the consignor's actual interest in delivery at destination.

In interpreting what constituted a special declaration in the case of Emirate Airline v. Tochukwu Aforka & Anor. (supra) his Lordship Iyizoba, J.C.A. held at page 35-36 that:

“It is my view that the special declaration envisaged in Article 22(3) means more than just presentation of the sales invoice and the packing list. The declaration of value ought to be in writing on the airway bill. DW1 in Re-examination had stated categorically that they rely on the Airway Bill and that no value was declared on it. In the case of Rembrandt Jewellery v. Air Canada (1985) O.J. No. 1382, it was held that a verbal statement of value made on the telephone is not a special declaration of value within the meaning of the convention. There is consequently no convincing evidence that the Respondent made a special declaration of the value of the goods. The limitation of liability as contained in the Montreal Convention and the Conditions of Carriage of Cargo of the Defendant is applicable in the circumstances of this case.”

e. Destruction, Damage or Loss that Occurs while a Baggage or Cargo is in the Charge of the Carrier.

Article 18 (3) provides that the carriage by air within the meaning of paragraph (1) of Article 18 comprise of the period during which the cargo is in the charge of the carrier. The fact that the cargo has not been air lifted is consequently of no moment. Once the carrier has taken control of the cargo and issued the airway bill, any loss from then on is covered by the Convention and the limitation of liability clause subject to the stated exceptions as provided in the Convention. Emirate Airline v. Tochukwu Aforka & Anor. (supra)

f. Conversion of Monetary Units

The liability sums mentioned in Articles 21 and 22 shall be converted to Naira at the existing official exchange rate. Article 23.

g. Review of Limits of Liability by the Minister of Aviation

The Minister of Aviation is statutorily empowered by Article 24 to review the limits of liability prescribed in Articles 21, 22 and 23 upon the advice by the Nigerian Civil Aviation Authority at seven year intervals, the first of such review is to take place at the end of the seventh year following the date of entry in force of the Civil Aviation Act, 2006.

h. Higher or No Limits Clause

A carrier may stipulate that, the contract of carriage shall be subject to higher limits of liability than those provided for in the Convention or to no limits of liability whatsoever. Article 25.

i. Lower or Exemption from Liability Clause

Any provision tending to relieve the carrier of liability or to fix a lower limit than that which is laid down in this Convention shall be null and void, but the nullity of any such provision does not involve the nullity of the whole contract, which shall remain subject to the provisions of the Convention. Article 26.

j. Punitive, Exemplary or any other Non-Compensatory Damages

In the carriage of passengers, baggage and cargo, any action for damages, however founded, whether under the Convention or in contract or in tort or otherwise, can only be brought subject to the conditions and such limits of liability as are set out in the Convention without prejudice to the question as to who are the persons who have the right to bring the suit and what are their respective rights. In any such action, punitive exemplary or any other non-compensatory damages shall not be recoverable. Article 29 - See Emirate Airline v. Tochukwu Aforka & Anor. (supra) pages 49-50, paras. A-A ,per Augie, J.C.A.

k. Receipt of Baggage or Cargo without Complaint

The receipt by the person entitled to delivery of checked baggage or cargo without complaint is prima facie evidence that the same has been delivered in good condition and in accordance with the document of carriage. Article 31.

l. Time within which to make Complaints

In the case of damage, the person entitled to delivery must complain in writing to the carrier forthwith after the discovery of the damage, and, at the latest, within:

a) two days from the date of receipt in the case of checked baggage;

b) seven days from the date of receipt in the case of cargo; and

c) fourteen days from the date on which the baggage or cargo have been placed at his or her disposal, in the case of delay.

If no complaint is made within the times prescribed, no action shall lie against the carrier, save in the case of fraud on its part.

3. Avoidance of Liability

An airline carrier can avoid or escape liability under or in the following circumstances:

a. Defence of Due Diligence: A carrier shall not be liable for damage occasioned by delay if it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for it or them to take such measures. Article 19.

b. Contributory Negligence: Where the damage, death, or injury was caused or contributed to by the injured or dead person's negligence. The carrier shall be wholly or partly be exonerated from its liability to the claimant to the extent that such negligence or wrongful act or omission caused or contributed to the damage or death. Article 20.

c. Effluxion of Time: The right to damages shall be extinguished, if an action is not brought within a period of two years, calculated from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped. See Article 35 ; Ibidapo v. Lufthansa Airlines (1997) 4 NWLR (Pt. 498)124 at 161.

4. Unlimited Liability of Carrier

There are situations in which a passenger will be entitled to damages for breach of contract of carriage by an airline more than the limit set under the Convention , these situations include :

a. Willful Misconduct :

In the case of: Harka Air Services (Nig) Ltd. V. Keazor (2011) 13 NWLR (Pt.1264) 320 at 342,para. A; 360 H. His Lordship, Rhodes-Vivour, JSC stated at page 364 C – D, that:

"Willful misconduct is a deliberate wrong act by a pilot airline staff or its agent which gives rise to a claim for damages by passengers. When staff of an airline act with reckless indifference. Such unacceptable behaviour especially by a professional person amounts to willful misconduct."

A carrier shall not be entitled to avail itself of the provisions of paragraphs 1 and 2 of Article 22 which exclude or limit its liability, if it is proved that the damage resulted from an act or omission of the carrier, its servants or agents, done with intent to cause damage or recklessly and with knowledge that damage would probably result; provided that, in the case of such act or omission of a servant or agent, it is also proved that such servant or agent was acting within the scope of its employment. Article 22 (5).

Where the breach occasioning loss is as a result of willful misconduct by a carrier, it loses its entitlement to rely on statutory limitation of liability.In Cameroon Airlines v. Mr. Mike Otutuizu (2011)2 KLR (Pt.291) 373, it was held that the carrier committed willful misconduct, thus the respondent was entitled to more damages than the limit set in Article 25 in the Warsaw Convention now Article 22 (1) and (2) in the Montreal Convention.

In the case of Oshevire v. British Caledonia Airways Ltd. 1990 7 NWLR 507, it was held that where a parcel containing valuable cargo is stolen as a result of concerted action taken within the scope of their employment by one or more employees of the carrier who also most probably stole the documents, the plaintiff would be entitled to more damages than the limit in Article 22, since the carrier had committed willful misconduct. The court held further that, in all other cases spelt out in the Convention the limits on liability must be followed but where there is breach of contract of such a magnitude that it amounts to a willful act, a willful misconduct the limits are no longer applicable.

5. Jurisdiction

An action for damages must be brought, at the option of the Claimant , either :

a. before the court of the domicile of the carrier ; or

b. of its principal place of business; or

c. where it has a place of business through which the contract has been made or before the court at the place of destination.

In respect of damage resulting from the death or injury of a passenger, an action may be brought before:

a. one of the three courts mentioned in above ; or

b. in the territory of a State Party in which at the time of the accident the passenger has his or her principal and permanent residence and to or from which the carrier operates services for the carriage of passengers by air, either on its own aircraft, or on another carrier’s aircraft pursuant to a commercial agreement, and in which that carrier conducts its business of carriage of passengers by air from premises leased or owned by the carrier itself or by another carrier with which it has a commercial agreement.

In Nigeria, the Claims for damages under the Montreal Convention can only be made in the Federal High Court which in Nigeria has exclusive jurisdiction over Aviation related causes of action. See Section 251 (1) K of the Constitution ; Article 33.

Conclusion

All is well that ends well, an air carriage that, ends in the delay,damage or loss of baggage/cargo or death or injury of airline passengers cannot be said to have ended well. Given the fact that, the right to compensation or damages for delayed,damaged or lost baggage/cargo or death or injury of an airline passenger has a time limit,it is advisable that, the affected passenger,consignor or victim promptly consult with a lawyer sound in aviation law.

Akintunde Esan, Legal Practitioner/Consultant, Legal Blogger and Chartered Mediator -

Managing Partner,Ase Olodumare Chambers.

For further illuminations on the right of an airline passenger or consignor in Nigeria to compensation or damages for the delay,damage or loss of baggage/cargo or death or injury of passenger on board , you are advised to contact Akintunde Esan.

AVIATION LAW: REMEDIES FOR DELAYED,DAMAGED OR LOST  BAGGAGE /COMPENSATION FOR DEATH OR INJURY OF  AIRLINE PASSENGERS IN NIGERIA is a legal illumination of AKINTUNDE ESAN known as The LEGAL ADVISER ONLINE. Akintunde Esan is the Managing Partner & Principal Consultant @ ASE OLODUMARE CHAMBERS (Legal Practitioners/Consultants & Chartered Mediators)