ADMIRALTY JURISDICTION OF THE FEDERAL HIGH COURT OF NIGERIA

Section 251(1)(g) and (3) of the Constitution vests the FHCN with exclusive original jurisdiction in civil and criminal cases relating to admiralty. The initial controversy as to whether other courts, such as the State High Courts could exercise concurrent jurisdiction with the FHCN on admiralty mattersFootnote ⁴ was laid to rest with the clear provisions of section 272(1) of the Constitution, which made the hitherto unlimited jurisdiction of State High Courts subject to the FHCN's exclusive original jurisdiction in matters contained in section 251, including admiralty jurisdiction and carriage by sea.Footnote ⁵

In virtually the same wording as the Constitution, the Federal High Court Act 1973 (as amended) confers on the FHCN exclusive original jurisdiction to try civil and criminal causes and matters relating to admiralty.Footnote ⁶ However, while the question of the exclusivity of the FHCN's jurisdiction in admiralty matters has been settled, questions as to matters that fall within the scope of the admiralty jurisdiction of the court remain. The AJA, which sets out the ambits of the FHCN's admiralty jurisdiction,Footnote ⁷ confers on the court jurisdiction to hear and determine any admiralty or other jurisdiction connected with any ship or aircraft being exercised by or vested in any other court in Nigeria immediately before the commencement of the act.Footnote ⁸ A combined reading of sections 1 to 4 of the AJA shows that the FHCN's admiralty jurisdiction covers all proprietary and general maritime claims.Footnote ⁹ It can be argued that including “off-shore industry mobile units”Footnote ¹⁰ in the definition of “ship” under the AJA and the inclusion of “any jurisdiction connected with any ship or aircraft” in the admiralty jurisdiction under the act clearly convey the idea that the court's admiralty jurisdiction extends beyond activities on the high seas.Footnote ¹¹

Presently in Nigeria, it is not clear whether CTS has become a species of maritime practice under the applicable legal framework comprising national legislation and international instruments. The uncertainty resulting from the absence of specific national legislation on CTS has created a gap in the country's admiralty jurisprudence. For instance, the Carriage of Goods by Sea Act 1926,Footnote ¹² which domesticated the International Convention for the Unification of Certain Rules Relating to Bills of Lading and Protocol of Signature 1924 (the Hague Rules),Footnote ¹³ applies only to the carriage of goods in ships from any port in Nigeria to any other port, whether in or outside Nigeria. It does not apply to carriage beyond the navigable waters as in CTS contracts. The UN Convention on Carriage of Goods by Sea 1978 (Hamburg Rules)Footnote ¹⁴ is domesticated in Nigeria by the UN Convention on Carriage of Goods by Sea (Ratification and Enforcement) Act 2005 (Hamburg Rules Act).Footnote ¹⁵ Under the Hamburg Rules, a “contract of carriage by sea” is defined as “any contract whereby the carrier undertakes against payment of freight to carry goods by sea from one port to another; however, a contract which involves carriage by sea and also carriage by some other means is deemed to be a contract of carriage by sea for the purposes of this Convention only in so far as it relates to the carriage by sea”.Footnote ¹⁶

By necessary implication, CTS contracts fall within the definition of contracts of carriage contemplated under the Hamburg Rules for the sea leg of the carriage only. The UN Convention on International Multimodal Transport of Goods 1980 (Multimodal Transport Convention)Footnote ¹⁷ and the UN Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, 2009 (the Rotterdam Rules),Footnote ¹⁸ which both seek to extend admiralty practice beyond the sea shores to apply to all stages of multimodal transport arrangements, are yet to come into force. Nigeria has neither signed nor ratified the Multimodal Transport Convention and has signed but is yet to ratify the Rotterdam Rules.Footnote ¹⁹ Thus, the rules regulating the liability of multimodal transport operators (MTOs) are presently found in international conventions on carriage of goods by sea, regional and sub-regional agreements, and national laws governing different aspects of transport operations.Footnote ²⁰ It can be argued that certain provisions of the AJA have expanded the FHCN's admiralty jurisdiction to cover carriage by means other than by ship. For example, under section 1(1)(g) of the act, the court's admiralty jurisdiction includes, “any matter arising within a federal port or national airport and its precincts, including claims for loss of or damage to goods occurring between the unloading of goods across space from a ship or an aircraft and their delivery at the consignee's premises, or during storage or transportation before delivery to the consignee”.

Furthermore, the court's admiralty jurisdiction in respect of carriage and delivery of goods extends from the time the goods are placed on board a ship for the purpose of shipping to the time the goods are delivered to the consignee or whoever is to receive them, whether or not the goods were transported on land during the process.Footnote ²¹ These provisions clearly constitute a strong basis for the FHCN to recognize CTS-related claims for onshore activities as a species of its admiralty jurisdiction.

JUDICIAL APPROACHES TO THE FHCN'S ADMIRALTY JURISDICTION IN RELATION TO CTS

Owing to the absence of a specific regulatory framework for CTS in Nigeria, the jurisprudence in that regard is largely being shaped by judicial pronouncements, which are currently ambivalent in relation to the onshore stages of the carriage of goods. A number of cases decided by the Supreme Court and the Court of Appeal between 1987 and 2019 capture the variegated judicial approaches by Nigerian courts to the issue. With regard to carriage before and after the sea leg, the Nigerian Supreme Court held, in the cases of Aluminium Manufacturing Co (Nig) Ltd v Nigerian Ports Authority Footnote ²² and Petrojessica Enterprises Ltd and Another v Leventis Technical Ltd,Footnote ²³ that a claim for loss of, or damage to, goods must relate to a ship for it to come under admiralty jurisdiction. In Aluminium Manufacturing, the court relied on its earlier decision in American International Insurance Company v Ceekay Traders Ltd Footnote ²⁴ and held that the ambit of the FHCN's admiralty jurisdiction is as prescribed by section 1(1)(g) and (h) of the English Administration of Justice Act 1956 (EAJA) and subsequently by section 7(1)(d) of the Nigerian Federal High Court Act 1973. According to the court, it would amount to a ridiculous interpretation of section 1(1)(h) of the EAJA to hold that, because the goods had been carried in a ship, any claim for damage to or loss of the goods anywhere on land after the completion of the journey by sea would fall within that provision. It held that the admiralty jurisdiction could not be invoked in the case, as the loss did not take place on the high seas and that the claim in the case (loss of part of the goods in a warehouse after the goods had been fully unloaded from the ship) would be more appropriately founded on a simple contract of bailment and negligence, totally devoid of any maritime colouring and not within the admiralty or other civil jurisdiction of the FHCN.Footnote ²⁵ In Petrojessica, the Supreme Court restated that the FHCN's admiralty jurisdiction relates only to voyage by seaFootnote ²⁶ and that, once a cargo is unloaded from the vessel, carriage by sea ends.Footnote ²⁷

In Panalpina v Glenyork,Footnote ²⁸ the Court of Appeal refused to follow Aluminium Manufacturing and Petrojessica. The court meticulously distinguished Panalpina from the two cases and pointed out that the Supreme Court's decisions in the two earlier cases were inapplicable in the circumstances of Panalpina because different legislation applied to the latter case. The court held that the provisions of section 1(1)(h) of the EAJA upon which the Supreme Court based its decisions and those of section 1(1)(a) and 2(3)(f) of the AJA do not pertain to the same subject matter. The court declared that the admiralty jurisdiction of Nigerian courts has been extended by virtue of section 1(2) of the AJA from its previous port-to-port limitation for claims, to include claims for damage to goods occurring between unloading goods from a ship and their final delivery at the consignee's premises. According to the court, section 1(2) of the AJA informed the current concept of dry ports in Nigerian cities like Ibadan, Kano, Aba, Bauchi, Katsina, Gombe and Jos, consequent upon which, damage to goods unloaded from ships in transit “on a camel” to the consignee, qualifies as a matter within the FHCN's admiralty jurisdiction. According to the court:

Even though the Court of Appeal did not overtly refer to CTS in the judgment, it is submitted that its decision is clear evidence of a paradigm shift in Nigeria's admiralty jurisprudence, which ought to have sounded the death knell on the unregenerate and hidebound locality test for invoking the FHCN's admiralty jurisdiction. Unfortunately, a subsequent pronouncement of the Supreme Court and decisions of the Court of Appeal in later cases have not advanced this position. In Pacers Multi-Dynamics v Dancing Sisters,Footnote ³⁰ the Supreme Court stated in passing that the FHCN's admiralty jurisdiction cannot be invoked once goods on board a ship have been discharged at the harbour and that, for an admiralty jurisdiction to be properly invoked, the goods must remain in the vessel.Footnote ³¹

This stance and pronouncement clearly supplant the spirit and letters of the innovation introduced by section 1(1) and (2) of the AJA and evidently run counter to the clear provisions of section 1(1)(h) and (3) of the AJA. Section 1(3) brings within the ambit of the court's admiralty jurisdiction, banking or letters of credit transactions involving the import or export of goods in a ship or an aircraft as well as any agreement or purported agreement relating to carriage of goods by sea whether executed or not. To insist that, once the goods have been discharged from the ship, the FHCN's admiralty jurisdiction cannot be invoked would be detrimental to the interests of financiers of international trade, such as banks that usually hold a lien on the goods. The Supreme Court's mantra that the “goods must remain in the vessel” has been rehashed to re-constrict the FHCN's clearly expanded admiralty jurisdiction under the AJA, thereby inhibiting the recognition of CTS as a species under the FHCN's admiralty jurisdiction.

The Supreme Court in Pacers Multi-Dynamics relied on two Court of Appeal decisions: Brawal Shipping Nigeria v Aphrodite (Nig) Ltd Footnote ³² and MNS Ltd v JP Ent Ltd,Footnote ³³ both decided before Panalpina. Given that Panalpina is more recent, one is left to speculate why the Supreme Court chose older Court of Appeal decisions over a more recent one. Evading the Panalpina approach is indicative of a purposeful detour back to the restrictive approach of Petrojessica and Aluminium Manufacturing, which were decided under the 1926 Carriage of Goods by Sea Act and 1956 EAJA regimes, while Panalpina and Pacers Multi-Dynamics were both decided under the more recent Hamburg Rules Act and AJA regimes. Besides creating the untoward impression that Nigeria's Supreme Court is still obsequiously keeping an entente cordiale with British imperialism, it is submitted that the court's pronouncement on that point of law in Pacers Multi-Dynamics, although obiter, if not reversed urgently could have far-reaching economic implications for the country. Carriage of goods in contemporary international trade is predominantly executed via combined or multimodal transportation of goods. Prospective players in the CTS industry would be more guarded about doing business in a country where policies regulating the industry are indeterminate.Footnote ³⁴ So, if the present state of the law is not addressed in a timely fashion by the courts in Nigeria, the courts may turn out to become the unintended handmaids of wealth (dis)creation for the country. This is important in actualizing the expected role that intermodal transport systems will play in improving Nigeria's ease of doing business ranking.Footnote ³⁵

Both the Court of Appeal and the Supreme Court failed to grasp the opportunity provided by the recent case of Delmas and Others v Sunny Ositez International Ltd Footnote ³⁶ to advance the jurisprudence in this regard. In this case, the grounds of appeal were mainly whether the bill of lading in issue was a combined transport bill of lading or a port-to-port bill of lading and whether the plaintiff / respondent's suit, filed after nine months but within 12 months of the accrual of the cause of action, was competent. The Supreme Court agreed with the Court of AppealFootnote ³⁷ that the subject matter of the suit was not a combined transport bill of lading because it did not specify any address for the delivery of the goods outside Apapa Port and did not show any other mode of carriage before the carriage by sea. The Supreme Court also upheld the Court of Appeal decision that, the subject matter being a port-to-port bill of lading, the respondent's suit (filed after nine months but within 12 months of the accrual of the cause of action) was competent, as the nine-month limitation period provided in the bill of lading and section 18(1) of the AJA were inapplicable. Although the appellate courts failed to make any pronouncement by way of obiter dictum as to what would have been the position had the subject matter been a combined transport bill of lading, two significant facts stand out. First is the courts’ reliance on counsel's brief and a foreign textbookFootnote ³⁸ for the definition of CTS, which clearly laid bare the sore absence of substantive legislation defining and regulating CTS in Nigeria. Secondly, perhaps, had the finding of the trial court that the bill of lading was a combined transport bill been upheld by the appellate courts, they would have upheld the court entertaining the matter under its admiralty jurisdiction, as that was not questioned by the appellate courts.

THE WAY FORWARD FOR NIGERIA

The requirement to recognize the wider meaning of admiralty jurisdiction is justifiable not only because it is the correct interpretation of the relevant statute (the AJA) but also because it accords more with the motive of conferring exclusive jurisdiction in admiralty matters on a special court. Multi-modal / CTS is rapidly gaining ground across the globe. It is better for a special admiralty court to handle all cases arising from CTS contracts, instead of an admiralty court only handling cases arising from the sea leg and a court of general jurisdiction handling matters arising from the same contract and associated with other legs of the carriage. This is the direction in which shipping nations are going and it becomes important that Nigerian courts should construe relevant existing statutes purposefully in a manner that would not set the Nigerian legal system on a different path from those of other countries. For example, in 2004 the US Supreme Court in Norfolk Southern Railway Co v James Kirby Pty Ltd Footnote ³⁹ held the reach of maritime contract law to govern carrier liability for damage to cargo shipped under a through bill of lading during an inland carriage leg of over 350 miles from the ocean carriage terminal. The court specifically held that, conceptually, so long as a bill of lading requires substantial carriage of goods by sea, its purpose is to effectuate maritime commerce and thus it is a maritime contract, and that character as such is not defeated simply because it also provides for some land carriage.

When effective policy and legislative frameworks on CTS are put in place in Nigeria, the need for extending the FHCN's admiralty jurisdiction beyond the sea segments of carriage in CTS contracts as advocated in this article will become more obvious. Admittedly, there is still no operational international regime for MTO regulation, nor has Nigeria enacted any domestic legislation to regulate MTOs. Nevertheless, Nigeria can take a cue from Singapore, a member of the Commonwealth, which as such shares common colonial antecedents and a common legal system with Nigeria, in expanding the admiralty jurisdiction of her national courts by acceding to relevant regional instruments and private sector-driven initiatives, which can propel national legislation in that regard. Nigeria can do this by first acceding to a continental regulatory framework for multimodal transport in Africa, the Revised African Maritime Transport Charter 2010,Footnote ⁴⁰ which aims to harmonize and implement policies on transport and related activities in coastal and inland waterways, and territorial seas of states parties and related activities in landlocked states parties.Footnote ⁴¹ The charter obligates state parties to work towards the establishment of a harmonized legislative and regulatory framework capable of promoting and guaranteeing the stability of multimodal joint ventures and to endeavour to participate in the negotiation, adoption and implementation of regional and international conventions on multimodal transport.Footnote ⁴² At least 23 countries including South Africa and Ghana have now signed the charter and ten countries have also ratified it.Footnote ⁴³ Unfortunately, Nigeria is yet to sign it. Nigeria would do well to sign and ratify the charter in order to take advantage of its extensive provisions on international multimodal transport. Singapore signed up to the Association of South East Asian Nations Framework Agreement on Multimodal Transport 2005, which regulates regional multimodal transport operations in South East Asia.Footnote ⁴⁴ By virtue of her accession to this agreement, Singaporean courts became vested with jurisdiction over disputes arising from international multimodal transport contracts within South East Asian countries.

Secondly, freight forwarders’ associations in Nigeria should take a cue from their Singaporean counterparts by forging co-operation with chambers of commerce, industries and the banks to initiate a private sector-driven CTS framework pending a legislative framework in that regard. For instance, in Singapore, the Singapore Freight Forwarders Association in close co-operation with the Trade Development Board initiated the regulation of MTOs. With the support of the International Enterprise of Singapore, the Association of Banks in Singapore and the Singapore International Chamber of Commerce, their efforts resulted in the establishment of the Singapore Registry of Accredited Multimodal Transport Operators on 6 April 1995. A self-regulatory and non-statutory body, this registry aims to promote the interests of the freight forwarding industry in Singapore. One of its membership requirements is the issuance of the International Federation of Forwarding Agents Associations multimodal transport bill of lading, by which cargo handling in all intermediary stages, from pre-carriage to main carriage and on to post-carriage, is the sole responsibility of the MTO. Thus, with a single multimodal transport document, the MTO takes full responsibility for the cargo and, in the event of damage to or loss of the cargo, the shipper or consignee no longer needs to seek redress from the actual carrier but simply claims against the MTO who in turn can claim against the liable sub-contracting carrier. This offers numerous advantages from both administrative and economic perspectives, including cost-reduction, optimizing transit times by merging different transport modes under centralized control, reduced warehouse time and costs, and decongestion of the ports and roads, reducing polluting emissions.Footnote ⁴⁵

Furthermore, in keeping with article 31 of the Hamburg Rules (which requires every contracting state that is also party to the Hague Rules and their 1968 Visby Protocol, within a maximum period of five years after signing the convention, expressly to denounce the Hague / Visby Rules), Nigeria needs to repeal the Carriage of Goods by Sea Act.Footnote ⁴⁶ The main purpose of domesticating the Hamburg Rules was not just to improve on the provisions of the Hague Rules but to replace them in their entirety with the more CTS-friendly Hamburg Rules, as the rules governing carriage of goods by sea in Nigeria.Footnote ⁴⁷ Thus, section 1 of the Hamburg Rules Act provides that, from the commencement of the act, the provisions of the Hamburg Rules (set out in the schedule to the act) shall, subject as provided therein, “have force of law and shall be given full recognition and effect” and be applied by all authorities and persons exercising legislative, executive and judicial powers in Nigeria.

CONFLICTS OF INTEREST

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