By Amaka Ezeno MCLArb
For emphasis sake, I will state again that the Respondent has no right whatsoever to unilaterally place a restriction order on the accounts of the Appellant not even for the best of reasons.
If such action is allowed, the bank can abuse such powers and it is to avoid such abuse that Section 34 of the EFCC Act provides that the EFCC cannot instruct a bank to freeze the account of a customer without the order of a Court.
What is clear from the facts of the case on appeal is that there was no Court order that gave the Respondent power to place the accounts of the Appellant with the Respondent on restriction. The Respondent unilaterally took that decision without the order of any Court.
This was a bold and dangerous step taken by the Respondent. While generally this is not right but the point must be made that cases are decided on the strength of the facts of each case. See Onyia vs. State (2008) 7-12 SC 120.
The case of the Respondent is that in the light of the criminal cases against the Appellant, the restriction placed on the accounts of the Appellant is within legal limits.
The Respondent on this proposition of the law referred to the case of Agwaramgbo vs. UBN (supra) in submitting that based on the doctrine of lis pendens the Respondent was in order in placing restriction on the Appellant’s accounts without a Court order. The Appellant on the other hand holds the view that the Respondent could not rely on that case. This is the time to look at the application of the doctrine of lis pendens and to see its application to this appeal.
Once there is a pending suit which determines rights between the parties, no right should be conferred on any of the parties pending the determination of the suit. No action should be taken over the subject matter which will jeopardize the outcome of the case.
This is to prevent a situation of foisting on the Court fiat accompli. It stands to reason that once there is a case over the matter the status quo is to be maintained. In Olori Motors Co. Ltd. & Ors. vs. UBN Plc (2006) 10 NWLR (Pt. 989) 586 the apex Court in stating what lis pendens mean held thus: “The expression lis pendens variously interpreted indifferent forms means a pending action or suit or a controversy in Court particularly in relation to the subject matter of a property. There is implicit in the doctrine of lis pendens that a buyer who purchases a property still subject of a determination of the Court has bought for himself a big trouble as the outcome can be against the vendor.”
Similarly, the apex Court in Enekwe vs. Int’l Merchant Bank of Nig. Ltd. & Ors (2006) 11-12 SC 3 held thus: “The expression is made up of two Latin words.
The first is lis. The second is pendens. The word lis means a piece of litigation, a controversy. The word pendens conveys the connotation of pending. The two words put and read together generally mean a pending law suit. The expression is a useful latinism that has given its name to a notice required in some jurisdictions to warn all persons that certain property is the subject matter of litigation, and that any interests acquired during the pendency of the suit must be subject to the outcome of the litigation.
Traditionally, this notice was called the notice of lis pendens, but 20th Century American Lawyers have shortened the phrase to merely lis pendens. See Bryan Garner, A Dictionary of Modern Legal Usage, Second Edition, page 350. This reflects and confirms the traditional racing colloquial language of the Americas and the Americans.
The doctrine which is embedded in the common law gives notice to persons by way of warning that a particular property is the res of a litigation and that a person who acquires any interest in it must know well ahead that the interest will be subject to the decision of the Court on the property. This reminds me of the fuller Latin expression, pendent elite nihilinnovetur, which means, during litigation nothing new should be introduced.
A person who buys real property in the course and pendency of a litigation has bought litigation for himself and should be prepared to face the litigation. In other words, the fortunes or gains of persons in respect of the property will be dictated or determined by the result or outcome of the litigation. Such is the strong caveat placed on the property. Although the doctrine is not the same as caveat emptor in strict legal content, it has some loose or vague affinity with it, as it relates to a person buying or purchasing a property in a market overt.”
See also Osidele & Anor. vs. Sokunbi NSCQR Vol 51 (2012) 337.
The Respondent submitted that the doctrine applies to all manner of cases. I really do not think that represents the legal position. The main purpose of the doctrine is to protect the subject matter of a pending litigation and therefore it is much more relevant in cases involving landed property. In BFI Group Corporation vs. B.P.E. (2012) 18 NWLR (Pt. 1322) 209, the Supreme Court held in this regard thus: “It is being touted that the respondent has taken steps to foist a fait accompli on the Court.
The respondent must be made to appreciate the purport of the doctrine of lis pendens which is aimed at preserving the subject matter of litigation. Any extraneous body including Russal which buys the subject of litigation does so at its own risks. See Vaswani Trading Co. v. Savalakh & Co. (1972) NSCC 692; Ogundiani v. Araba (1978) 6-7 SC 55 at 74.”
For the doctrine to apply, the Respondent must prove that the case pending in Court must relate to the property. This was stated by the Supreme Court in Oronti vs. Onigbanjo (2012) 12 NWLR (Pt. 1313) 23 in these words: “This Court had in Alhaji Usman Bua v. Bashiru Dauda (2003) 13 NWLR (Pt. 838) 657 per Uwaifo, JSC, reiterated the conditions on which the doctrine of lis pendens would apply. It was stated thus:
That it must be shown;
(a) That at the time of the sale of the property the suit regarding the dispute about the said property was already pending. See Bellamy v. Sabine (1857) 26 LJ (NS) Equity Reports 797 at 803;
(b) That the action or lis was in respect of real property; it never applies to personal property. See WIGRAM v. BUCKLEY (1984) 3 Ch. 483 at 492-493;
(c) That the object of the action was to recover or assert title to a specific real property; that is to say, an action in a subject matter adverse to the owner in respect of some substantive right which is proprietary in nature: See CALGARY AND EDMONTON HAND CO V. DOBINSON (1974) 1 All ER 484 at 489; and
(d) That the other party had been served with the originating process in the pending action: See DRESSER UK LTD. v. FALCONGALT FREIGHT MANAGEMENT LTD. (1992) ALL ER 450 at 523.
It must be stated that the four conditions above must co-exist before the doctrine of lis pendens would apply. Another way of saying it, is that the absence of any of those conditions would render inapplicable the doctrine. It is that simple. I refer to Nsirim v. Nsirim (1995) 9 NWLR (Pt. 418) 144; Enekwe v. International Merchant Bank of Nigeria Limited (2006) 19 NWLR (Pt. 1013) 147.”
The point must be made here that the doctrine is not applicable to all cases. See Network Security Ltd. vs. Dahiru & Ors. (2007) LPELR-8852 (CA); Agbu vs. Civil Service Commission Nasarawa State & Ors. (2010) 2 FWLR (Pt. 528) 4773.
To be continued in the next edition…