garnishee proceedings

Where a bank (garnishee) disputes liability, the court will not make an order compelling the bank to pay the debt sum in the debtor’s account to the creditor. Rather, the court will stand down the garnishee proceeding and order that such issue or questions raised, bothering on the liability of the bank (garnishee) be sorted out. The court may even refer such question or issue to a referee. In determining the issue or question of liability of the bank (garnishee) the court may make an order directing which of the three (3) parties will be the Plaintiff or the Defendants. Order 8 Rule 8(2) Judgment Enforcement Rules; Nigeria Hotels Ltd. V. Nzekwe (1990) 5 NWLR (Pt. 149) 187 at 197; Section 87 Sheriffs and Civil Process Act Cap 56 LFN 2004

The burden placed on a garnishee bank when it denies liability would be discharged if the bank can successfully prove that the account referred to in the garnishee proceeding does not belong to the judgment debtor, or does not exist in its system or even if it exists, that it is heavily indebted and not in credit or that the number stated in the order nisi has changed to another version. Citizens Int’l Bank Ltd. V. SCOA (Nig) Ltd. (2006) 18 NWLR (pt. 1011) 332 at 336

No, a garnishee order cannot be made to attach to a new account opened after the service of the garnishee order. As such a garnishee order served on a bank attaching an account of the judgment debtor cannot be held to also attach a subsequent account opened by the judgment debtor at a later date. Happenstall V. Jackson (1939) 1 KB 585

Where the judgment debtor satisfies the court that the money in the account is not for his use, it becomes immaterial whether the account is in the name of the judgment debtor or not. Such account cannot be attached by an order of the court, and the judgment creditor has no right to the balance in the account. A Client’s account operated on his behalf by the judgment debtor does not transfer the right or sum in the account to the judgment debtor. Hancock V. Smith (1889) 41 CHD 456

Where a creditor knows that the debtor has some amount of money in his account with a bank and the debtor is refusing to pay him the debt sum, the creditor may approach the court for an order against the bank compelling the bank to pay the said sum in the debtor’s account to him (the creditor). The proceeding is usually in two (2) stages. The first stage involves the creditor obtaining an order nisi from the court directing the bank to give reason why the court should not allow the order for payment of debt owed by the bank customer (debtor) to the creditor. The first stage does not involve the debtor. It involves only the creditor and the debtor’s bank. The second stage is tripartite in nature because it involves the creditor and the bank. The second stage is the stage where all the parties are given opportunity N.A.O.C Ltd. V. Ogini (2011) 2 NWLR (Pt. 1230) 131 at 152 – 153; Fidelity Bank Plc. V. Okwuowulu (2013) 6 NWLR (Pt. 1349) 197 at 213-214; Purification Techniques (Nig.) Ltd. V. A-G Lagos State (2004) 9 NWLR (Pt. 879) 665 at 678-679

Where an order nisi has been served on the bank, the bank (garnishee) is entitled to set off any debt the judgment debtor owes him at the date when the order nisi was served upon him. The bank (garnishee) can as well make a counter claim against the judgment debtor where the counter claim arises out of the same transaction as the debt sought to be attached. Fidelity Bank Plc. V. Okwuowulu (2013) 6 NWLR (Pt. 1349) 197 at 217; Tap V. Jones (1975) 10 LRQB 519 at 593

A garnishee order made absolute upon consent by the judgment debtor can be set aside upon application that it be set aside. However, the judgment debtor must show in evidence that he was mistaken to have consented that it be made absolute and that the garnishee order was made upon such mistake. Moore V. Peachey (1892) 66 LT 198

Yes, the court has the inherent jurisdiction or power to set as its own garnishee order made absolute upon application by the judgment debtor establishing that the order absolute was, for some reason, wrongfully made. Siemers export KG v. West German & Trading Co. Ltd. (1985) HCNLR 965

An order nisi only creates an equitable charge over the funds in the debtor’s account in favour of the judgment creditor. Order 45 Rule 2 of Supreme Court 1983

Where the court makes an order absolute in a garnishee proceeding and the judgment creditor executes same, the court would mandate the judgment creditor to refund the money where the order is set aside. Moore V. Peachey (1892) 66 LT 198; Marshall V. James (1905)1 CH432

No, a garnishee order absolute cannot be validly executed against a garnishee (bank) where the garnishee is not in possession of money that belongs to the judgment debtor. Nigerian Hotels Ltd. V. Nzekwe (1990) NWLR (pt. 149) 187. The purpose of a garnishee proceeding contemplates a debt in the hand of the garnishee which is capable of being attached. Where this is not the case, there will be no basis for a garnishee proceeding. Barclays Bank DCO v. Bright Gravel & Granite Service (1963) LLR 19

The necessary parties to garnishee proceedings are the judgment creditors (garnishor) and the Garnishee (bank). Notwithstanding that the judgment debtor has the money in the account or in the hand of the garnishee which the creditor seeks to attach; the judgment debtor nevertheless cannot on its own appeal against a garnishee order of the court made absolute. This right is reserved for the garnishee. In fact, the court has referred to a judgment debtor as “… a mere busy body meddling in the affairs that do not concern him” P.P.M.C Ltd. V. Delphi Pet. Inc. (2005) 8 NWLR (Pt. 928) 484-458 UBA V. Ekanem (2010) 6 NWLR (Pt. 1190) 207. However, the above is true at the first stage of a garnishee proceeding where the judgment creditor approaches the court for an order nisi. On the second stage of a garnishee proceeding, the Sheriff and Civil Process Act envisages a tripartite proceeding in which all interest is represented. N.A.O.C v. Ogini (2011) 2 NWLR (pt. 1230) 131

Yes, a joint account can be attached when the account holders are jointly indebted to the judgment creditor. However, where only one of the account holders is indebted to the judgment debtor and same is successfully proved, then such joint account cannot be attached as no part of a joint account can be attached for the debt of one person. Hirchhorn V. Evans (1938) 54 LT 1069

There are times where a debtor may default in paying up the debt he owes a creditor. As a result, the creditor having knowledge that the debtor has some money kept in possession of a third party may approach the court to compel the third party to pay such money to him as a way of settling the debt and not the debtor who is the original owner of the money. This process is called a garnishee proceeding. In this context, the debtor is the customer of the bank (judgment debtor), the third party which is the bank is referred to as the Garnishee and the creditor is the judgment creditor.

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No, the court will grant an order nisi upon an application made by the creditor. This application is usually made ex parte. That is, it is made without notice to the opposing party. And even if the opposing party somehow have notice of the application, he will have no right to address the court on that application after an order nisi is granted by the court, the court will fix a period of not less than 14 days after the service of the order nisi on the debtor and the bank so that they can give reason why the court would not make the order nisi an order absolute. It is important to note that there can be an appeal against a garnishee order made absolute. N.A.O.C Ltd. V. Ogini (2011) 2 NWLR (pt. 1230) 131 at 153. Section 14(1) Court of Appeal Act Cap LFN 2004

No, the Garnishee bank cannot set off debt due it from the judgment debtor that comes into existence after an order nisi has been served on it. Furthermore, the garnishee bank cannot set off debt due to it from the judgment creditor either. O.A.U Ile-Ife V. Olanihun (1996) 8 NWLR (pt.464) 123 at 129

No, the judgment debtor has no right to withdraw such money because a lien has been created over the money which has been attached as a debit sum. In fact, notwithstanding the bank’s relationship with the customer (judgment debtor) the bank cannot release the money already attached by an order of the court even upon request by the judgment debtor except where the court sanction it. This is because the bank (garnishee) becomes a custodian of the sum attached and cannot part with same except by the sanction of the court. Rogers V. Whiteley (1892) AC 118

No, a garnishee order absolute cannot be validly executed against a garnishee (bank) where the garnishee is not in possession of money that belongs to the judgment debtor. Nigerian Hotels Ltd. V. Nzekwe (1990) NWLR (pt. 149) 187. The purpose of a garnishee proceeding contemplates a debt in the hand of the garnishee which is capable of being attached. Where this is not the case, there will be no basis for a garnishee proceeding. Barclays Bank DCO v. Bright Gravel & Granite Service (1963) LLR 19