The court will not strike out a suit simply because of failure in obtaining approval to act in a representative capacity

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CHIEF OROK I. IRONBAR v. FEDERAL MORTGAGE FINANCE LTD.

SUPREME COURT OF NIGERIA

(KEKERE-EKUN; GARBA; OGUNWUMIJU; JAURO; AGIM, JJ.SC)

BACKGROUND FACT

Chief Orok I. Ironbar (The Appellant ) is the biological son of the late Chief Orok Ita Orok, who had obtained a loan/credit facility from the then Nigeria Building Society which became Federal Mortgage Bank and then Federal Mortgage Finance Ltd, (The Respondent) on record. On the demise of the late Chief Orok Ita Orok in April 1985, his indebtedness to the Respondent was ₦18,802.66K, which the Appellant undertook to liquidate with the agreement of the Respondent. What gave rise to the dispute between the parties was the Appellant’s contention that despite the fact that he had liquidated his father’s indebtedness, the Respondent continued to increase the interest rate arbitrarily without notice to him or any of the late Chief’s children, thereby unjustifiably extending the indebtedness and issuing him with conflicting statements of account. It was the Appellant’s contention that despite several reconciliatory meetings held with the Respondent, the Respondent continued to regard the late Chief Orok Ita Orok’s debt as unpaid and continued to include arbitral interest on the supposed debt. Aggrieved by the Respondent’s actions, the Appellant suing as next of kin of the deceased, instituted an action against the Respondent, claiming among other reliefs that the debt had been liquidated, an injunction restraining the Respondent, as well as an Order for damages.

At the close of trial, the learned trial judge dismissed the suit on the grounds that the Appellant, not being a party to the contract between his late father and the Respondent, lacked the locus standi to institute the action, declared the action to be incompetent and accordingly dismissed it.

On appeal to the Court of Appeal (lower Court), the court agreed with the learned trial Judge on the incompetence of the suit but held that the proper order to be made was one striking out the suit and not an order of dismissal. The judgment of the trial court dismissing the suit was set aside and replaced with an order striking it out.

Further dissatisfied with the decision of the lower Court, the Appellant appealed to the Supreme Court. One of the issues raised was: Whether the Appellant had the proper locus to pursue these proceedings/case

ARGUMENTS

Counsel for the Appellant argued that it was apparent from the statement of claim that he was the son of the deceased, and that he was suing to recover the property of his late father which is the reason he made payments to the Respondent. He argued that it was wrong for the court below to ignore the relevant portions of the statement of claim which proved the capacity in which the Appellant instituted the action. Counsel further argued that there is no need to obtain a court order to sue in a representative capacity insofar as the Claimant as shown in the pleadings and evidence put forth before the Court his capacity to sue in a representative capacity. The Appellant further submitted that he properly described his interest in the pleadings wherein he stated that the building under mortgage belonged to his late father, and he had taken over, with the agreement of the Respondent, the responsibility of liquidating the outstanding debt. He concluded by stating that locus standi can be established where the plaintiff shows that he has sufficient interest or legal right in the subject matter of the dispute.

In response, the learned Counsel for the Respondent argued that the capacity in which the Appellant sued is speculative, as he is either next of kin, an agent or a representative and it is not for the court to decide for him in which of the capacities he should prosecute his case. Respondent counsel submitted further that the failure of the Appellant to point out clearly his locus standi rendered the suit incompetent and robbed the court of requisite jurisdiction to entertain the suit. Counsel contended that locus standi constitutes a condition precedent to the institution of any action before a court without which the court will be robbed of jurisdiction.

DECISION OF THE COURT

In resolving the issue, the Supreme Court held that:

The attitude this court adopts in matters of this nature is not a rigid one. It depends on the facts and circumstances of the case. If there is evidence that the parties appear to possess representative capacity and act on the authority of those they represent, this court does not and will not upset a judgment on a bare assertion of failure to obtain the approval of the court. Thus, in applying this principle to the instant case, where the pleadings and evidence show that the plaintiff instituted the action as next of kin of the deceased, the court will not strike out the suit merely because the plaintiff was not specific in the title of the suit as to the capacity in which he instituted same.

Although the appellant was clearly undecided as to the capacity in which to institute the action, the pleadings and evidence showed that he sued as next of kin of the deceased and the lower court, with due respect, should have so held.

Issue resolved in favour of the Appellant

Orok O. Ironbar, Esq., for the Appellant

Ibrahim Bawa, Esq., for the Respondent

This summary is fully reported at (2024) 10 CLRN in association with ALP NG & Co.
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