Appeal Court Orders Terminal Operators to Refund N1tn

The Court of Appeal in Lagos wednesday ordered terminal operators to refund N1trillion to the federal government.

The court also upheld the power of the Nigerian Shippers’ Council (NSC) to intervene in shipping agency charges and fees collectable by suppliers of shipping and terminal services in Nigerian ports.

The appellate court, whose judgment was read by Justice Chidi Nwaoma Nwagbara upheld an earlier judgement of the Federal High Court in the case between the NSC, Seaport Terminal Operators Association of Nigeria (STOAN) and Association of Shipping Line Agencies (ASLA).

The ASLA and SOAN have been having a running battle with the NSC over the reduction of shipping line agency charges (SLAC) and refund of container deposits collected by ASLA members and reduction in progressive storage charges and increase in free storage days by STOAN members.
The two groups had in 2015 secured an order for stay of execution of the ruling of a Federal High Court in Lagos which earlier dismissed their suits against the NSC.

However, in her judgment yesterday, Justice Nwagbara dismissed the appeal, even as she upheld the counter claim of the second respondent which is the Shippers Association Lagos State (SALS).

The lower court had re-established the powers of NSC to regulate and negotiate tariff in the port industry, explaining that no tariff must be fixed or collected arbitrarily in the industry without the approval of the council.

According to the court, “The unilateral introduction and imposition of the SLACs, by the appellant and collection of same from shippers or users shipping/port services from 2006 to date is illegal, ultra vires and, therefore, null and void.”

Consequently, the shipping firms were ordered to refund money already collected, with interest pegged at 21 per cent.
It is this judgment that the duo of STOAN and ASLA appealed.

Speaking wednesday after the judgment, counsel to SALS, Emmanuel Nwagbara said the court simply upheld the judgment of the lower court.
He said: “The Court of Appeal upheld the judgment of the lower court and this appeal was dismissed and the counter claim of the second respondent which is the SALS is upheld.”

Speaking further, he said the preliminary objection having succeeded means there was no valid appeal.
According to him, there were many grounds of the appeal by the appellant.

“What I have given is the summery of the judgment, there were many grounds of the appeal. In fact I think they had up to 17 to 18 grounds of the appeal and normally issues are a summary of the content of the grounds which should be reduced to a manageable level. One may file 18 grounds of appeal and the issues formulated may be reduced to five to six grounds. I can’t recall exactly how many issues that formulated those grounds. And on our own side we compressed the entire issues for determination by the court into two.

“Our two issues were one whether the lower court was right in joining SALS to the originating sermons. Secondly whether the court in upholding our claim and these we believe answered all the issues that are before this court as far as SALS is concerned. Shippers Council also had issues which they have formulated which touched on their status as the economic regulator,” he concluded.

In his reaction, the President of SALS, Jonathan Nicole said that the implication of the judgment is that terminal operators should go and compute how much they have been collecting outside the agreed and stipulated fees.

According to him, there is an agreement they entered into with the Shippers Council but they started charging well and above the fees in the concession agreement. They should now compute all these money and pay it to the Cargo Defence Fund.

“On the shipping lines case, we got judgment last year and we just got that of the terminal operators today. All the prayers granted by the lower court was upheld and the appeal by the terminal operators was dismissed, the lower court gave judgment in favor of SALA and Shippers Council in the first judgment.

“Also, the SALS was proper granted entry into the case because we are the major association covering other shippers, we are not working for our own interest alone but for everybody,” he said.