Whether Registration Creates Interest in Land where there is None

CASE TITLE: FBN LTD v. STANBIC IBTC BANK PLC (2023) LPELR-60773(CA)

JUDGMENT DATE: 14TH JULY, 2023

JUSTICES: ONYEKACHI AJA OTISI, JCA
ABUBAKAR SADIQ UMAR, JCA
ABDULLAHI MAHMUD BAYERO, JCA

DIVISION: LAGOS

PRACTICE AREA: JUDGMENT AND ORDER

FACTS:
This appeal stems from the Lagos State High Court’s ruling on January 18, 2018, delivered by Justice K.O. Dawodu.

The dispute revolves around the attachment and sale of a property in Ikoyi, Lagos, to satisfy a judgment debt of N275,000,000 obtained by the Respondent against Mr. Seun Ogunbambo. Simultaneously, the Appellant, having obtained a separate judgment against Ogunbambo, sought to protect its interest in the same property, alleging that the Respondent concealed the registration of its judgment, leading to the court’s erroneous attachment order. The trial court dismissed the Appellants’ application, prompting this appeal.

ISSUE(S) FOR DETERMINATION:
The appeal was determined on:

“Whether the learned Judge of the lower Court was right in refusing to set aside its order of attachment made on July 1st, 2016 in favor of the Respondent thereby dismissing the Appellant’s application?

COUNSEL SUBMISSIONS:

Learned counsel for the Appellant argued that the trial Court erred in not giving priority to the Appellant’s earlier registration of its interest in the property. Counsel asserted that the Appellant’s registration on February 26, 2016, took precedence over the Respondent’s subsequent registration on January 23, 2017, relying on legal maxims and precedents. The Appellant contended that the property’s encumbrance, established through registration, barred the trial Court from granting the Respondent’s attachment application, rendering the order null.

Further, counsel for the Appellant claimed that the Respondent deliberately misled the Court by not presenting a clean copy of the search report, asserting that the order obtained by the Respondent on July 1, 2016, was tainted by fraud and deceit. The Appellant emphasized the equitable principle that one must come to equity with clean hands and urged the Court to declare the Respondent’s order null and void.

In response, counsel for the Respondent contended that the judgment in Suit No. LD/5614/14 did not confer ownership or proprietary interest in the subject property on the Appellant. The Respondent argued that the Appellant’s registration amounted to nothing since it did not confer property rights, relying on legal authorities. Additionally, the Respondent disputed the Appellant’s reliance on legal maxims, asserting that the Appellant’s argument for the application of “qui prior est tempore portiorest jure” was a fallacy.

Regarding the allegation of fraud and deceit, the Respondent argued that the Appellant failed to substantiate the claim and emphasized the high standard of proof required for such allegations. Respondent’s counsel asserted that the Appellant did not fall within the exceptions stipulated by Sections 47 and 48 of the Sheriffs and Civil Process Law for challenging or setting aside a sale under an order of writ of attachment. The Respondent urged the Court to dismiss the appeal.

DECISION/HELD:
The appeal was dismissed.

RATIOS:
JUDGMENT AND ORDER – ATTACHMENT OF IMMOVABLE PROPERTY: When registration of judgment will not be held to confer title to property to invalidate an order of attachment to the property

“As can be seen from the Appellant’s application to the lower Court and its processes before this Court, the foundation upon which the Appellant erected its case is the registration at the Federal Land Registry in Ikoyi on February 26, 2016 of the judgment it obtained in Suit No. LD/5614/14. The Appellant’s case will therefore succeed or fail depending on the strength or weakness of the registration. Commenting in his ruling on page 402 of the Record of Appeal, on the registration of the judgment on which the Appellant rests its case, the learned Judge of the lower Court, said:

”I have carefully perused the judgment dated the 6th July, 2015 registered by the Applicant. The judgment is a money judgment.”

After quoting the relevant portion of the judgment to buttress his point, the learned Judge continues,

“I agree with the submission of learned counsel to the judgment creditor/Respondent that registration or no registration, there is nothing in the judgment in Suit No. LD/5614/2014 that confers any interest in the Applicant in the subject property. The judgment did not confer ownership or proprietary right of the property at 2, Olamijuyin Avenue, Park View Estate, Ikoyi, Lagos, or any property whatsoever on the Applicant.”

It is clear from the community reading of Sections 2 and 16(1) of the Land Instrument Registration Law of Lagos State that documents cognizable for registration under the law are documents that affect land. I have also gone through the judgment of O.A. Adamson J. registered by the Appellant on pages 224–230 of the Record of Appeal.

The judgment obtained by the Appellant is a bare money judgment; the property at 2, Olamijuyin Avenue, Park View Estate, Ikoyi, Lagos, is not a subject of pronouncement in the judgment. Other than the much touted registration of the judgment against the title of the property, I cannot find any nexus between the judgment and the subject property, and the Appellant did not point to any.

The question is, does the registration being brandished by the Appellant, ipso facto, confer title to the subject property on the Appellant? The answer is in the negative. In IDAKWO (RTD) vs. IBRAHIM & ORS (2011) LPELR-8936(CA), (Pp. 46–49 paras. A), this Court, Per OGBUINYA J.C.A., said:

”Besides, as already observed, registration does not create interest or rights in land where there is none, nor does it consolidate one that is improperly acquired. See Ashiru vs. Olukoya (supra) and Omiyale vs. Macaulay (supra).

In the case of Ayinla v. Sijuwola (1984) NSCC 301 at 311 or (1984) 1 SCNLR 410 at 422, the Supreme Court affirmed that: “Clearly, between these two registered conveyances, that of the respondent was first in time and took priority, although the act of registration does not confer a better title. In fact, registration of instruments is not concerned with the validity or authenticity of such instruments. Once the deed is registrable, it will be accepted for registration even if its terms are inconsistent with a deed in relation to the same land registered earlier.”

Section 44 of the Sheriffs And Civil Process Act provides ”If sufficient movable property of the judgment debtor can be found in the Federal Capital Territory, Abuja or the State, as the case may be, to satisfy the judgment and costs and cost of execution, execution shall not issue against his immovable property, but if no movable property of the judgment debtor can with reasonable diligence be found, or if such property is insufficient to satisfy the judgment and costs and the costs of execution, and the judgment debtor is the owner of any immovable property, the judgment creditor may apply to the Court for a writ of execution against the immovable property of the judgment debtor, and execution may issue from the Court against the immovable property of the judgment debtor in accordance with the provisions of this Act, and any rules made thereunder: Provided that where the judgment has been obtained in a Magistrate’s Court execution shall not issue out of the magistrate’s Court against the immovable property but shall issue out of the High Court upon the conditions and in the manner prescribed.

From the above provision of the law, it is crystal clear that a judgment creditor in a money judgment, such as the Appellant has to cross the hurdle of satisfying the Court that no sufficient movable property of the judgment debtor can be found before going after the immovable property of the judgment debtor. So it is not automatic. The judgment creditor will need to file an application through which the judgment debtor will be put on notice. See LOTATEX (NIG) LIMITED & ANOR vs. BANK OF AGRIC (2015) LPELR-40754 CA, MICHAEL vs. ENGINEER ANTHONY ANENE (2015) LPELR-40873 CA, BADAMOSI vs. UBA PLC & ORS (2017) LPELR-45402 CA.

It is this procedure that the Respondent followed before being granted the order of attachment of July 1, 2016, which the Appellant is now seeking to invalidate. The right of ownership and possession of the subject property by virtue of the order of attachment made in favour of Respondent on July 1, 2016, remains unimpeachable until it is set aside, but certainly not on account of the appellant’s registration, which was devoid of any substratum.

It seems to me that the Appellant is quite aware of this, hence its decision to also approach the lower Court Coram Adamson J., to secure an order of attachment of the property on February 3, 2017, knowing fully well that the mere registration of its judgment does not confer title to the property. So in my considered view, if the competition between the Appellant and the Respondent on the subject property warrants the application of the maxim qui prior est tempore portieres jure, it will not be on the basis of the registration of the judgment by the two sides but on the basis of the writs of attachment. It is the writ of attachment, as the word implies, that attaches or creates a nexus between the money judgments obtained by the Appellant and the Respondent and the subject property. See Section 32 of the Sheriffs and Civil Process Act.

And if the competition is on the basis of an order of attachment, the Respondent’s order of attachment, which was obtained on July 1, 2016, takes priority over that of the Appellant which was subsequently granted on February 3, 2017.”Per UMAR, J.C.A.

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