Unveiling the Impact: What Happens When a Garnishee Ignores a Court Summons Over Debt Disputes

CASE TITLE: POLARIS BANK LTD v. PRIMA IMPEX (NIG) LTD LPELR-61497(CA)

JUDGMENT DATE: 2ND AUGUST, 2023

JUSTICES: OYEBISI FOLAYEMI OMOLEYE, JCA
IBRAHIM ALI ANDENYANGTSO, JCA
SYBIL ONYEJI NWAKA GBAGI, JCA
DIVISION: AWKA

PRACTICE AREA: GARNISHEE PROCEEDINGS

FACTS:
The appeal stems from a ruling of the High Court of Anambra State, made on May 13, 2015. The respondent, a judgment creditor, had obtained a judgment against the judgment debtor in a previous case (Suit No. LD/004/2005) in the High Court of Lagos State. The respondent subsequently initiated a garnishee proceeding against the appellant and twelve other banks, seeking to attach any funds in their possession belonging to the judgment debtor to satisfy the previous judgment.

The initial motion ex parte for the garnishee proceeding was granted by Justice A. O. Okuma on November 18, 2013, resulting in a garnishee order nisi against the appellant. This order was later made absolute on March 10, 2014, as the appellant failed to file an affidavit to show cause as to why the order should not be made absolute.

The appellant, after the order nisi was made absolute, filed an application to set aside the order absolute on November 7, 2014. The appellant argued that it did not appear in court to show cause because it believed the respondent knew where the judgment debtor maintained an account, as the judgment debtor had no account with the appellant.

However, the trial Court did not find this reason sufficient to set aside the Order Absolute and subsequently dismissed the application on May 13, 2015. Dissatisfied with the ruling, the appellant filed an appeal in the Court of Appeal.

ISSUES FOR DETERMINATION:
The Court determined the appeal based on a sole issue, thus:

Whether the learned trial Court was right in holding that there was no cogent reason in law to set aside the order absolute of 10/3/2014 having regard to the circumstances of the case.

COUNSEL SUBMISSIONS:

Counsel for the appellant argued that the trial judge erred in law by finding no sufficient reason to set aside the Order Absolute. It was contended that the respondent failed to provide evidence of a banking relationship between the judgment debtor and the appellant, thus making the garnishee proceeding baseless. Referring to several cases, it was emphasized that garnishee proceedings require a debt owed to the judgment debtor, which was not demonstrated in this case. Counsel urged the court to allow the appeal and revoke the Order Absolute.

In response, counsel for the respondent maintained that the trial court’s decision was justified. It was argued that there is no legal requirement for the garnishee to disclose the account number of the judgment debtor before obtaining an Order Nisi. Referring to several cases concerning the conditions for setting aside a judgment, it was asserted that the appellant failed to meet any of these conditions. Counsel urged the Court to uphold the trial court’s orders, emphasizing that the appellant’s reasons for non-appearance were insufficient and did not meet the necessary conditions for setting aside the judgment.

DECISION/HELD:
In the final analysis, the Court dismissed the appeal.

RATIO:
PRACTICE AND PROCEDURE – GARNISHEE PROCEEDINGS: Effect of failure of a garnishee to appear in Court to dispute/pay the debt owed

“The appellant’s reason for being absent at the trial in which judgment was given against him despite being served with the necessary processes of the honorable court is flimsy, unconvincing, and not of good reason enough to excuse him.

Hence, the trial Judge was right when he refused to set aside the garnishee order absolute for lack of cogent and good enough reason.

I must reiterate the law that the only reason an order absolute can be set aside is if there is evidence on record that the garnishee was not properly personally served with the garnishee order nisi to show cause.

Once this garnishee in this present case failed to respond to the summons and the order absolute was made against it, the issue of a cogent and not good enough reason need not be considered. The garnishee, by its silence and refusal to appear for whatever reason and/or show cause, becomes estopped from complaining of the order absolute made against it. The onus is on the garnishee to show why the order nisi should not be made absolute.

In the circumstances of this case, the garnishee’s willful failure and neglect to respond to lawful and competent summons and the failure to advance a cogent and good enough reason cannot be allowed to defeat the garnishee’s order. Litigants are not, for any reason, given sentimental reasons to avoid the consequences of their failure to respond to court summonses. In this case, the order Nisi was given on November 18, 2013, while the order Absolute was given on March 10, 2014, providing an opportunity for the garnishee to show cause. The courts will protect its dignity, sanctity, and integrity. The Courts are not toothless bulldogs and will resist any attempt to treat lawful orders with disdain.” Per GBAGI, J.C.A.

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