In matters involving debt recovery, the primary consideration for the creditor is recovery of the amount owed or judgment debt. Most creditors are keen to know the options that guarantee or aid recovery of the debt in the event of a judgment. Whilst it is important to get a judgment in favor of the creditor, the key concern is the ability of the judgment creditor to successfully recover the amount.
Part of the impediments to enforcing a judgment in Nigeria is the appeal process. Although the general rule is that an appeal against a judgment does not operate as a stay of execution of the judgment, our courts are reluctant to enforce any judgment or make any order in respect of the judgment sum where an appeal has been lodged against the judgment. Judgment debtors have obtained orders for stay of execution and/or frustrated enforcement proceedings relying on their appeals. Unfortunately, once the enforcement proceedings are stalled, the judgment debtors are not eager to prosecute their appeals. This has contributed to the delay in the hearing and determination of appeals.
To curb the abuse of the appeal process to frustrate the recovery of a judgment debt, the Court of Appeal introduced a provision in the Court of Appeal Rules 2021 (Order 4 Rule 6) which empowers the court to make certain orders necessary for the protection of the res pending the determination of an appeal upon fulfilment of some conditions from an applicant for such orders. The conditions are contained in Order 4 Rule 6 (1) (b) as follows:
- an undertaking to diligently prosecute the appeal is given by the applicant
- in appeal relating to monetary judgments, a bond, guarantee or other like instrument from an eligible institution, in such sum not exceeding the judgment sum, as the Court may direct, deposited as security for the judgment sum or such sum, as the Court may determine, deposited into an interest-yielding account in the name of the Chief Registrar or Deputy Chief Registrar of the Court
The aim of the above provision is to ensure the timely prosecution of appeals by the judgment debtors and to guarantee the judgment creditor's right to recover the judgment sum if the appeal is unsuccessful.
We note that many judgment creditors are not aware of the above provision, hence the same has not been enforced in applications for stay of execution at trial court or the Court of Appeal. We believe that this provision if enforced by the court will deter judgment debtors from filing frivolous appeals or application for stay of execution to deny the judgment creditor of the fruits of its judgment.
Originally Published 30 September 2022
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