Judgment
UWANI MUSA ABBA AJI, J.S.C. (Delivering the Leading Judgment) : The Respondent by a loan and mortgage agreement dated 26/8/1992 took a term loan of US$921,080.00, US$25,094.00 and from the 1st Appellant to acquire additional plant, equipment and machinery for its biscuit factory project (Kan Biscuit Factory) situate at Aba in Abia State. In default, the 2nd Appellant was appointed as Receiver.
The Respondent, who was the Plaintiff, at the Federal High Court sued the Appellants as Defendants in February, 1999, challenging the appointment of the 2nd Appellant by the 1st Appellant as Receiver in respect of the assets of the Respondent, an order directing the Appellants to reconcile its account with the Respondent and an order of injunction restraining the Appellants from taking over or disposing the Respondent’s assets. Before the proper hearing, the Respondent vide a motion for interlocutory injunction sought to restrain the Appellants from selling KAN Biscuit Factory.
The application was however refused by the trial Court on 27/10/1999. This prompted the Respondent to appeal to the lower Court on 8/11/1999. Nevertheless, while the substantive matter was pending before the trial Court and the interlocutory appeal before the lower Court, the Appellants went ahead and sold the factory of the Respondent to DE-ENDY INDUSTRIAL COMPANY LIMITED. Consequently, the Respondent vide a motion on notice before the Federal High Court where the substantive matter was pending, sought to set aside the sale being made pendente lite.
The trial Court delivered its ruling on 30/4/2002 setting aside the sale.
Dissatisfied, the Appellants appealed to the lower Court, which dismissed the appeal and upheld the decision of the trial Court.
Further aggrieved, the Appellants have appealed to this Honourable Court seeking for determination: Whether having regard to the entire circumstances of the claims constituted in the substantive suit, all being declaratory claims and reliefs and the decision of the Courts on the interlocutory application to set aside the sale of items of personal properties-chattels (plant, equipment and machinery) other than landed property (real property) at interlocutory stage of the proceedings, the trial Court and Appeal Court were not wrong in applying the common law doctrine of lis pendens to the instant case and thereby inadvertently disposing of the substantive claims and reliefs still pending and abandoned before the trial, which led the Courts to give perverse judgments.
