IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA

IN THE LAGOS JUDICIAL DIVISION

HOLDEN AT LAGOS

 

BEFORE HIS LORDSHIP, HON. JUSTICE IKECHI GERALD NWENEKA

 

Date: 17th January 2019                                        SUIT NO. NICN/LA/507/2018

 

BETWEEN

 

MRS. IYEYINKA OLAYANJU                              CLAIMANT/RESPONDENT

 

AND

 

GLOBAL MERCANTILE AND CORPORATE LOGISTICS LIMITED              DEFENDANT/                                                                                                                                 APPLICANT

 

REPRESENTATION:

 

Felix Agbonrofo Esq. for the Claimant/Respondent

Anthony Nwajiugo Esq. for the Defendant/Applicant

 

RULING

 

1.      By motion on notice dated and filed on 6th December 2018 brought pursuant to Orders 1 rule 6 and 24 rule 1 of the National Industrial Court of Nigeria [Civil Procedure] Rules 2017 and under the inherent jurisdiction of this Honourable Court, the Defendant/Applicant [“the Defendant”] prayed this Court for an order referring the parties in this matter to Alternative Dispute Resolution Centre of the National Industrial Court for mediation of the subject matter of this suit and for such further or other orders as this Honourable Court may deem fit to make in the circumstance. The application is supported with 7 paragraphs affidavit deposed to by Mr. Nwajiugo Anthony, Legal Practitioner in the Law Firm of Electrofield Solicitors acting for the Defendant and a written address. The Claimant filed 7 paragraphs counter affidavit which she deposed to and attached one exhibit, exhibit A and a written address both dated and filed on 13th December 2018. The Defendant filed a reply on point of law to the Claimant’s written address. The application was heard on 16th January 2019. Mr. Nwajiugo, learned Counsel for the Defendant, relied on the facts contained in the affidavit in support and adopted his written address and reply on point of law as his argument in support of the application and urged the Court to grant same. Mr. Agbonrofo, learned Counsel for the Claimant, relied on the counter affidavit, the attached exhibit and adopted his written address as his argument in opposition to the application.

 

2.      I have reviewed the processes filed and submissions of learned counsel for the parties. Learned Counsel for the Defendant raised one issue for determination to wit: whether it is apposite for this Honourable Court to refer the parties in this suit to the Alternative Dispute Resolution Centre of this Honourable Court for mediation? Learned Counsel referred to clause 1.14 of the Defendant’s code of conduct and Orders 1 rule 6 and 24 rule 1 of the National Industrial Court of Nigeria [Civil Procedure] Rules 2017 in urging the Court to grant the application. It was argued that the fact that the Defendant has taken substantial step in the matter does not obviate the fact that the primary duty of the Court is to enforce the voluntary agreement of the parties. The Claimant also formulated one issue for determination, whether in the circumstances of this case it will be in the interest of justice to grant the application? Learned Counsel contended that having taken substantial steps in the matter, the Defendant is estopped from relying on the arbitration clause in the code of conduct. It was submitted that in determining whether to make the order, the Court should bear in mind the consensual nature of mediation and is enjoined not to make the order if there is no possibility of amicable settlement. The thrust of this application is that by clause 1.14 of the Defendant’s code of conduct the Claimant is required to submit the issues to the Lagos State Multi door Court House for arbitration before a one man arbitration panel before instituting the action. Clause 1.14 provides inter alia:

 

“For employees or ex-employees, issues as to remuneration pension, bonuses among other employment benefits shall prior to resorting to court proceeding explore the afore listed under this policy on arbitration procedure or submit themselves to Lagos State Multi door Court House for arbitration before a one man arbitration panel.”

 

An arbitration clause has been described as a contract within a contract, and thus this provision is binding on the parties. However, the originating processes were filed on 9th October 2018 and served on the Defendant on 10th October 2018. The Claimant filed a motion for judgment on 30th October 2018 and the Defendant filed a counter affidavit and written address to the motion together with its defence processes and a motion on notice to regularize the filing and service of the defence processes on 15th November 2018. The Defendant’s application was granted on 19th November 2018 and the case adjourned by consent of counsel to 29th November 2018 for trial and subsequently to 10th December 2018 for trial. On 6th December 2018, the Defendant filed this application. I have gone to this length to show the steps parties have taken in this case.

 

3.      There are two classes of arbitration clauses. One class is where the provision for arbitration is a mere matter of procedure for ascertaining the rights of the parties with nothing in it to exclude a right of action on the contract itself. The other clause is where arbitration, followed by an award is a condition precedent to any other proceedings being taken. Any further proceedings by the parties will not be on the original contract but on the award made under the arbitration clause. See Obi Obembe v. Wemabod Estates Limited [1977] 5 SC 70 at 78. The arbitration clause in question falls within the first class and does not oust the jurisdiction of the Court or prevent the parties from having recourse to the Court in respect of dispute arising therefrom. A party to an agreement with an arbitration clause has the option to either submit to arbitration or to have the dispute decided by the Court. The choice of arbitration does not bar resort to the Court. See the cases of Obi Obembe v. Wemabod Estates Limited [supra] at 79, Ligne Aeriennes Congolaises v. Air Atlantic Nigeria Limited [2006] 2 NWLR [pt.963] 49 at 73 and Ayantuga & Anor. v. Adedoyin [2006] LPELR-11761[CA]. Consequently, the submission of learned Counsel for the Defendant in paragraph 1.8 of his written address attached to the motion that “the said clause 1.14 of the Defendant’s code of conduct beyond the issue of arbitration contain other pre-action procedures that must be taken by the Claimant before resorting to court” is misconceived. First, clause 1.14 of the Defendant’s code of conduct makes provision for two categories of persons, employees and ex-employees. While employees are obliged to follow the grievance settlement procedure outlined therein, ex-employees are only required to “submit themselves to Lagos State Multi door Court House for arbitration before a one man arbitration panel.” This provision does not create any pre-action procedure that must be taken by the Claimant before initiating this action. Secondly, the state of our law is that parties to an arbitration clause have a choice. They may decide to have their dispute resolved by the Court or they may choose to have it decided by an arbitrator.  See Ayantuga & Anor. v. Adedoyin [supra] and Mainstreet Bank Capital Limited & Anor. v. Nigeria Reinsurance Corporation Plc [2018] 14 NWLR [pt.1640] 423 at 444.

 

4.      As rightly submitted by learned Counsel for the Claimant in paragraph 3.3 of his written address, the Defendant has taken substantial steps in this matter and can no longer rely on the arbitration clause. See section 5[1] of the Arbitration and Conciliation Act, CAP. A18 Laws of the Federation of Nigeria. In Obi Obembe v. Wemabod Estates Limited [supra] at 80, Fatayi-Williams, J.S.C., held:

 

“In order to get a stay, a party to a submission must have taken NO step in the proceedings. A party who makes any application whatsoever to the court, even though it be merely an application for extension of time, takes a step in the proceedings. Delivery of a Statement of Defence is also a step in the proceedings….Moreover, if the court has refused to stay an action or if the defendant has abstained, as in the case in hand, from asking it to do so, the court has seisin of the dispute, and it is by its decision, and by its decision alone, that the rights of the parties are settled.”

 

See also Mainstreet Bank Capital Limited & Anor. v. Nigeria Reinsurance Corporation Plc [supra] at 445-446 cited by learned Counsel for the Claimant. The Defendant filed its defence and counterclaim and reply to defence to counterclaim and the matter has been adjourned for trial on three occasions by consent of parties. It is my considered opinion and I so hold that in these circumstances the Defendant is estopped from relying on the arbitration clause. Learned Counsel’s submission that his application is not for stay of proceeding is puerile as a referral of the subject matter of this suit to the Alternative Dispute Resolution Centre for mediation amounts to stay of proceedings pending completion of the ADR proceedings.

 

5.      This leads me to a consideration of the provisions of Orders 1 rule 6 and 24 rule 1 of the National Industrial Court of Nigeria [Civil Procedure] Rules 2017. Section 254C[3] of the Constitution of the Federal Republic of Nigeria 1999 as amended grants this Court a discretion to establish an Alternative Dispute Resolution Centre within the Court premises on matters within its jurisdiction with a proviso that nothing in the subsection shall preclude the Court from entertaining and exercising appellate and supervisory jurisdiction over an arbitral tribunal or commission, administrative body, or board of inquiry in respect of any matter that the Court has jurisdiction to entertain or any other matter as may be prescribed by an Act of the National Assembly or any law in force in any part of the Federation. It is clear that this provision is directory and does not preclude the Court from adjudicating on matters within its jurisdiction. Pursuant to this provision, the National Industrial Court of Nigeria Alternative Dispute Resolution [ADR] Centre Instrument, 2015 was published. Article 4[4][a] provides:

 

“The Centre shall perform its duties on matters hereinafter listed in paragraph 5[a-d] of this Article on referral of the matter to the Centre by the President of the Court or a Judge of the Court, or by parties in dispute mutually opting to use mediation or conciliation processes for the resolution of their matter, upon the commencement of an action and joining of issues;”

 

It is interesting to note that referral of a case for mediation is within the discretion of the Court and by agreement of the parties. Order 24 rule 1 of the Rules of this Court similarly makes referral discretionary. Although, the word ‘shall’ appears in Order 1 rule 6 of the Rules of this Court, it did not impose a duty on the Court to refer matters for mediation. See Amalgamated Trustees Ltd. v. Associated Discount House Ltd. [2007] LPELR-454[SC] at page 52 and HRH Igwe G. O. Umeonusulu Umeanadu v. Attorney General of Anambra State & Anor. [2008] LPELR-3362[SC] at page 9. Referral of a matter before a Court to Alternative Dispute Resolution Centre depends on the Court’s understanding of the case and willingness of parties to settle amicably. Where, from the facts and circumstances of the case, an amicable settlement is not feasible, it will amount to waste of judicial time to refer a case for mediation.  Arbitration or mediation is consensual and parties must express a willingness to settle before a referral order can be made. This willingness is not manifest in this case.

 

6.      In the light of the foregoing, the Defendant has not made out a case for referring this suit to Alternative Dispute Resolution Centre of the Court for mediation. The application is refused and consequently dismissed. Ruling is entered accordingly.

 

 

………………………………………….

IKECHI GERALD NWENEKA

JUDGE

 

17/1/19