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PROPERTY NEWS
Court orders N500m bank guarantee over Lagos MOD property dispute
By Emmanuel Badejo
Published:Guardian, 29th June 2009
ALAGOS High Court has ordered the Federal Government through the Ministers of Justice and of Environment, Housing and Urban Development to obtain within 21 days a bank guarantee, which would cover a N500 million judgment sum in a renewed tussle over the 12-storey former Ministry of Defence (MOD) building on Lagos Island.
The order, made by the trial judge, Justice Adenike Coker, was given as the lone condition for staying further proceedings in a matter brought by the representatives of the estate of late J.F. Branco.
The Branco family, led by Mr. Simon Kouvi Kappo and two others had sued the government over what they termed wrongful acquisition of the property. The suit, which commenced in 1986, was concluded late last year by the trial court, which entered a N500 million-judgment sum as compensation to the plaintiffs.
Dissatisfied with the judgment, the government appealed, urging the Court of Appeal, Lagos to upturn the trial court's verdict.
While the appeal is yet to be listed by the appellate court, the defendants through a fresh application asked the trial court to stay further proceedings, pending the determination of the appeal. The Federal Government specifically sought for "an order staying unconditionally the execution of the judgment... pending the hearing and determination of the applicants' (Government) appeal by the Court of Appeal."
In support of the application for stay, the applicants filed and relied on a four-paragraph affidavit of one Ballah Alli, said to be a Litigation Officer in the office of the Attorney General of the Federation. A notice of appeal was also attached to the affidavit.
Some of the reasons canvassed by government's counsel, Mr. A.O. Ebong, for seeking for the stay are: "The court awarded the staggering sum of N500m against the defendants/applicants in the said judgment, that the defendants/applicants being aggrieved with the said judgment have lodged an appeal against same to the Court of Appeal, that the said appeal raises several serious and fundamental issues of law for the consideration of the Appeal Court, including the issue of lack of jurisdiction of the trial court to entertain the plaintiffs' action, and, that the appeal also challenges the propriety of the monetary award to the claimants/respondents in the case."
According to Eboh, the appeal questioned the validity of the judgment in the suit and, therefore, sought for same to be set-aside on the following among other grounds:
- lack of jurisdiction of the court,
- the claim for compensation was statute-barred,
- the amount awarded as compensation was without legal basis, and
- the judgment is null and void.
The government's lawyer also argued that the appeal had high chances of success.
On the other hand and in opposition to the said application, the judgment creditor (Branco Family) filed and relied on their 10-paragraph counter-affidavit deposed to by one Emmanuel Udegbunam, a legal practitioner in the law firm of Rhodes & Rhodes.
The affidavit reads as follows:
- that the claimants/respondents claim against the defendants/applicants for a declaration of entitlement to a statutory right of occupancy and compensation in respect of their property at 1-3 Moloney Street, Lagos was filed within twelve years from the date of accrual of cause of action,
- that a claim for declaration of title to land and compensation payable under the Land Use Act are determined exclusively by all the States High Courts and not Federal High Court,
- that the sum of N500m awarded, as compensation for the forfeiture and wrongful acquisition of claimants/respondents entire interest in the said property is not staggering as alleged by the defendants/applicants as it was based on credible and uncontroversial evidence before the court,
- that the subject property - an eleven storey office complex strategically located in a highly sought after commercial neighborhood in the Lagos central business district - has always been occupied by the Ministry of Defence since acquisition by the defendants/applicants,
- that the defendants' appeal has not genuinely raised any substantial issues of law as it lacks merit in its entirety,
- that the defendants/applicants have financial might to pay the judgment debt to the claimants, and
- that the defendants/applicants' application for unconditional stay of execution of the court's judgment lacks merit and is mal-fide and should be dismissed with substantial cost.
Arguing further, Rhodes urged in the alternative, that the respondents having waited for 20 years for the outcome of this suit, if the court were minded to grant the application that same be granted upon condition that the applicants pay the judgment sum into an interest-yielding account to be held in the name of the chief registrar of the court or for a bank guarantee to be given pending the outcome of the appeal.
Justice Coker said in her ruling that since she had decided the issue of jurisdiction, it was not recondite in any way as to constitute a special and exceptional circumstance, but that the issue should be left for the appellate court.
She said: "In any case as rightly pointed out, this court has taken a position in its judgment and it is left to the Court of Appeal to determine otherwise. Nonetheless, this court is persuaded that where such fundamental point is raised rightly or wrongly, its outcome ought to be awaited. This is notwithstanding the view of this court that the chance of success of the appeal is slim if not unlikely."
However, Justice Coker said that while the respondents were free to pursue their constitutional right of appeal, the balance of justice of the case with its peculiar facts and circumstances could only be served by granting a conditional order of stay of execution as per the alternative proposed by the respondents' counsel.
Her words: "That the applicants must obtain within 21 days ... a bank guarantee in favour of the judgment creditors/respondents for the payment over the judgment debt at the end of their appeal if they lose. This court so orders, accordingly."
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