CBN Wins As Appeal Court Voids N100.1m Garnishee Order

The Central Bank of Nigeria (CBN) has secured a major legal victory after the Court of Appeal, Abuja Division, in a judgement delivered by Justice Okon Abang, sets aside the Federal High Court’s decision attaching a N100.1 million judgement debt against the apex bank in a dispute involving the Imo State government.

Justice Abang held that the trial court acted on speculation rather than credible and verifiable evidence in making a garnishee order absolute against the CBN.

The court said the apex bank neither maintained an account for the Imo State government nor owed the state any attachable debt capable of sustaining garnishee proceedings.

The appeal arose from the judgement of the Federal High Court, Abuja, delivered on May 19, 2016, in garnishee proceedings instituted by Andrew Okoroji to enforce a N100,178,210 judgement earlier obtained against the Imo State government. The trial court had held that the state’s anticipated allocation from the Federation Account Allocation Committee (FAAC), domiciled with the CBN, constituted attachable funds.

Delivering the lead judgement, Justice Abang subjected the respondent’s evidence to rigorous judicial scrutiny and found it fundamentally deficient.

He held that Andrew Okoroji, who deposed to the counter-affidavit, neither claimed membership of FAAC nor disclosed the source of the information contained in his affidavit.

“All depositions in his counter-affidavit are documentary hearsay, which are not credible and reliable. I so hold.”

The court held that the trial judge acted with undue haste by making the garnishee order absolute without first resolving the factual disputes through trial.

Justice Abang stressed that garnishee proceedings must rest on credible, cogent and verifiable evidence, not assumptions or conjecture.

“The first respondent did not prove by verifiable evidence that the CBN was indebted to the Imo State Government to warrant the order nisi being made in the first place to attach a non-existent debt in the hands of the CBN.”

In one of the judgment’s most striking findings, Justice Abang held that the lower court proceeded on speculation by treating anticipated FAAC allocations as attachable debts despite the absence of any legal evidence establishing indebtedness on the part of the CBN.

He concluded that the trial court acted speculatively and was sentimental and emotional against the apex bank.

“There was no basis in fact and in law for the order to be made absolute.”

The Court unanimously allowed the appeal, set aside the garnishee order and awarded ₦1 million costs against the judgement creditor.

Abang held that the order absolute was made on the imagination of the trial court, adding “the trial court can not make an order in vain”.

Rejecting the argument that anticipated FAAC allocations constitute debts attachable in garnishee proceedings, Justice Abang reaffirmed the orthodox legal position that only an existing, ascertainable and legally enforceable debt can be attached.

The judgment represents a robust reaffirmation of settled principles governing garnishee proceedings and is expected to become an important appellate authority on the evidential threshold required before financial institutions can lawfully be subjected to attachment orders.

In another significant judgment delivered the same day, Justice Abang upheld the appeal of Barrister Igwe Onyesom Ugochukwu in a fundamental rights enforcement suit against KYC Interproject Ltd., while making an authoritative pronouncement on the treatment of affidavit evidence and electronic exhibits.

The appellant had alleged that he was unlawfully arrested by persons acting on behalf of KYC Interproject Ltd. while at his building site in Lugbe, Abuja. The Court held that the respondents, not being law enforcement authorities, had no legal power to arrest or detain him, and awarded ₦15 million damages for the violation of his constitutional rights to dignity, personal liberty, fair hearing and freedom of movement.

Beyond the award of damages, the appeal produced an important clarification of the law after the trial court dismissed the application because the applicant allegedly failed to “play” a video CD attached as an exhibit to the supporting affidavit.