Civil asset recovery in Nigeria

Civil asset recovery

Is there any restriction on civil proceedings progressing in parallel with, or in advance of, criminal proceedings concerning the same subject matter?

There is no restriction on civil proceedings progressing in parallel with, or in advance of, criminal proceedings concerning the same subject matter. Nevertheless, a court retains the discretion to stay civil proceedings during the pendency of criminal proceedings.

In which court should proceedings be brought?

Proceedings should be brought in a High Court. There are state High Courts in each of Nigeria’s 36 states and the Federal Capital Territory, as well as a Federal High Court, which has a presence in every state.

What are the time limits for starting civil court proceedings?

Six years for actions in tort and contract, and 12 years for actions seeking to recover land.

Where there has been an acknowledgement of the cause of action, the limitation period runs from the date of the acknowledgment. Where the cause of action is based on fraud, the period of limitation does not start until the claimant has discovered the fraud or could have discovered it with reasonable diligence. Similarly, where an action seeks relief from the consequences of a mistake, the limitation period will not start until the claimant has discovered it or could have discovered it with reasonable diligence.

In what circumstances does the civil court have jurisdiction? How can a defendant challenge jurisdiction?

Jurisdiction of the court is determined by the cause of action of the claimant as stated on the writ of summons and statement of claim. A defendant who wishes to challenge the jurisdiction of the court may enter a conditional appearance. The practice is to file a preliminary objection challenging the competence of the suit at the earliest possible time and before taking any steps in the matter, on the grounds that the court lacks the jurisdiction to entertain the action. Alternatively, the defendant may set his or her objections out in his or her statement of defence.

What is the usual time frame for a claim to reach trial?

The time for a civil court claim to reach trial will depend upon the court in which it is made. If the claim is made in a jurisdiction (there are 38 different civil jurisdictions where claims can be brought in Nigeria) where the courts deal with numerous actions (such as in Lagos State), claims will take longer to reach trial than in jurisdictions that receive fewer cases. Under the civil procedure rules applicable in most jurisdictions in Nigeria, civil claims can be expected to reach trial within a year from when they are filed.

What rules apply to the admissibility of evidence in civil proceedings?

Under the Evidence Act, evidence may be given in any suit or proceeding of the existence or nonexistence of every fact in issue, such other facts as are relevant (listed below) and of no others. All relevant facts are admissible subject to conditions that may be specified in each case under the Act. Generally, the following are relevant and admissible:

• facts forming part of the same transactions;
• facts that are the occasion, cause or effect of facts in issue;
• facts that show motive, preparation and previous or subsequent conduct;
• facts necessary to explain or introduce relevant facts;
• facts about things said or done by conspirators in reference to a common intention;
• facts not otherwise relevant but that are inconsistent with any fact in issue or relevant fact, and by themselves or in connection with other facts they make the existence or nonexistence of any fact in issue or relevant fact probable or improbable;
• facts that enable the court to determine the amount of damages to be awarded in proceedings where damages are claimed;
• facts showing the existence of a state of mind, body or bodily feeling;
• facts that have a bearing on the question of whether an act was accidental or intentional; and
• facts showing the existence of any course of business.

Evidence obtained improperly, in contravention of a law, or in consequence of an impropriety or a contravention of a law shall be admissible unless the court is of the opinion that the desirability of admitting the evidence is outweighed by the undesirability of admitting evidence that has been obtained in such a manner.

What powers are available to compel witnesses to give evidence?

The court has the power to summon witnesses to attend court for the purpose of giving evidence, and to produce documents. Failure to attend upon a summons may result in punishment by the court, by way of a fine or imprisonment.

What sources of information about assets are publicly available?

The Investment and Securities Act 2007 requires that all securities of a public company be registered with the Securities and Exchange Commission, and information may be found at the Commission concerning such shares. Information concerning the securities of companies generally may also be found at the Corporate Affairs Commission, which is the body charged with the statutory duty of company registration. Information is available to any member of the public upon formal application and payment of requisite fees.

Information concerning the registration of vehicles is decentralised and may be obtained at the relevant local governments in the state where the vehicle is licensed.

All information relating to land registration may be found at the land registry of the state where the land is situated. Information concerning any land in the state may be obtained upon formal application to conduct a search of the relevant file at the land registry and the payment of requisite fees.

Can information and evidence be obtained from law enforcement and regulatory agencies for use in civil proceedings?

Information and evidence obtained from law enforcement and regulatory agencies may be obtained for use in civil proceedings. The challenge, however, is in getting such agencies to provide information. Other than under the Freedom of Information Act, the only method of securing the production of evidence obtained by law enforcement and regulatory agencies unwilling to provide the evidence voluntarily is by resorting to the powers of the court to issue a summons, as described in question 7.

How can information be obtained from third parties not suspected of wrongdoing?

Generally, third parties could be summoned to court to testify or produce documents where the court, in the exercise of its discretionary powers, considers it appropriate to do so in the interests of justice. It is the claimant’s duty to provide materials that would guide the court in the exercise of its discretion.

Banks in Nigeria are usually reluctant to divulge any information concerning their customers and are only likely to give out any information upon an order made by a court directing them to do so.

However, where it appears to the court that there exists a basis to suggest that a wrong has been committed, the court may make an order compelling a third party to present information requested by an applicant. The applicant must, however, convince the court that the information required from the third party is one without which the matter cannot be decided.

What interim relief is available pre-judgment to prevent the dissipation of assets by, and to obtain information from, those suspected of involvement in the fraud?

A claimant who is anxious to prevent the dissipation of assets during the pendency of a matter may approach the court by a motion ex parte for an injunction to freeze assets. This would prevent a defendant from dissipating the assets beyond the jurisdiction of a court in an attempt to frustrate a judgment.

In appropriate circumstances, the courts will grant injunctions, following principles developed in the English case of Mareva Compania Naviera SA v International Bulk Carriers SA (1975) 2 Lloyd’s Rep 509. The Supreme Court has ruled that such injunctions may be granted where the following appears likely:

• the claimant would recover judgment against the defendant for a certain or approximate sum;
• there are reasons to believe that the defendant has assets within the jurisdiction to meet the judgment, wholly or in part, but might arrange it that he or she will not be available or traceable when judgment is given against him or her; or
• where a party seeks to obtain information from a person suspected of involvement in the fraud but who is not a part of the action, such party may approach the court for an order requiring such third party to disclose certain documents or information to the applicant. The onus is on the applicant to show that the action before the court would not be possible without the third party’s information.

How do courts punish failure to comply with court orders?

A party who refuses to comply with court orders may be cited for contempt of court. In the case of individuals, this may result in punishment by imprisonment, a fine or sequestration of assets. In the case of a corporation, the punishment may be by sequestration of assets or a fine.

How can information be obtained through courts in other jurisdictions to assist in the civil proceedings?

Information may be obtained from courts in jurisdictions with which Nigeria has made an agreement in that regard. The party that obtains an order for the examination of a witness abroad is expected to file an undertaking, at the registry of the court issuing the order, of financial responsibility for expenses incurred by the Ministry of Foreign Affairs with a letter of request to be issued concerning the order. The undertaking is to be accompanied by a copy of interrogatories where necessary. These documents are then dispatched alongside a request form to be signed by the chief judge of the issuing court addressed to the competent judicial authority of the other jurisdiction, requesting that the witness be summoned for examination at a specified time and place before the authority or person competent to take the examination.

What assistance will the civil court give in connection with civil asset recovery proceedings in other jurisdictions?

The civil courts can assist in the examination of witnesses where such witnesses are in Nigeria, and a request to that effect has been made from a jurisdiction with which Nigeria has made an agreement regarding this matter.

What are the main causes of action in civil asset recovery cases, and do they include proprietary claims?

Fraud, fraudulent transfer and breach of contract are common causes of action in civil asset recovery cases. Such actions could also include proprietary claims.

What remedies are available in a civil recovery action?

A claimant in a civil recovery action could approach the court for an order of restitution, damages, seizure, constructive trust or account of profits.

Can a victim obtain a judgment without the need for a full trial?

Where a defendant fails to appear, a claimant may proceed upon such default of appearance to obtain judgment under the appropriate provisions of the rules of court. Some rules of court also contain summary judgment provisions, which provide that where a claimant believes that there is no defence to his or her claim, he or she may seek summary judgment in a procedure that requires the defendant to demonstrate to the court the existence of facts that disclose a prima facie defence to the claims.

What post-judgment relief is available to successful claimants?

A successful claimant may have judgment enforced by taking out a writ of execution:

• the property of the judgment debtor may be seized and sold;
• debts due to the judgment debtor from third parties may be attached;
• imprisonment;
• sequestration of assets;
• bankruptcy (in the case of individuals); and
• through a winding-up order in the case of a corporation.

What methods of enforcement are available?

The Sheriffs and Civil Process Act, laws of the various states and the Judgments (Enforcement) Rules made thereunder make provisions for the enforcement of a judgment in Nigeria. Judgment for payment of money to a party is enforced by one or more of the following methods:

• writ of fieri facias (seizure and sale of goods): this is the most commonly used means of judgment enforcement in Nigeria, known as the ‘writ of fifa’. Under this method, a judgment sum is realised by the seizure and sale of a judgment debtor’s properties;
• garnishee proceeding: this type of proceeding allows for the attachment of debts that a third party owes the judgment debtor or money belonging to the judgment debtor, which is in the custody of a third party;
• judgment summons: a judgment debtor may be summoned and examined on oath as to his or her means and may be sent to prison if the court determines that although he or she has the means to discharge the judgment debt, he or she has wilfully refused to do so;
• bankruptcy and winding-up proceedings;
• writ of delivery: a claimant who obtains judgment for the delivery of certain goods may have judgment enforced by means of a writ of delivery addressed to the sheriff. The writ requires the sheriff to immediately seize the goods wherever they might be within the judicial division of the issuing court and to deliver them to the judgment creditor; and
• sequestration: a writ of sequestration empowers the bailiff to seize a person’s property, movable and immovable, in certain circumstances. These include where an order or warrant of arrest, commitment or imprisonment has been issued against that person but he or she cannot be found; or where he or she has been detained for failing to obey the judgment of the court but continues to disobey the judgment.

What funding arrangements are available to parties contemplating or involved in litigation and do the courts have any powers to manage the overall cost of that litigation?

A party may enter into a contract with his or her attorney for a contingent fee in respect of a civil matter to be undertaken on his or her behalf. The fee may be paid or agreed to be paid for the attorney’s service under an arrangement where compensation is contingent in whole or in part upon the successful accomplishment or deposition of the subject matter of the agreement, and is to be an amount that is either fixed or is to be determined under an agreed formula.

In addition, and given that the common law in England is law in Nigeria, since the common law torts of champerty and maintenance were abolished in England in 1967, it appears that there are no restrictions on third-party funding of litigation in Nigeria.

Costs incidental to all proceedings are solely at the discretion of the court. The court will normally take into consideration factors such as the cost of legal representation of the successful party, and travel and other expenses of parties and witnesses.