Date Published: 05/10/10

Big Tobacco suffers another huge setback: Update on Kano State Government Litigation against Tobacco Companies 

Background:

On May 25th 2007, the Kano State government instituted an action against British American Tobacco British American Tobacco (Nigeria) Limited, International Tobacco Company Limited, British American Tobacco Plc, British American Tobacco (Investment) Limited and Philip Morris International Inc. to obtain damages and other remedies on account of injuries and death caused by the production and sale of cigarettes by the tobacco companies.

Since the commencement of the action, tobacco companies have used all tactics to cause procedural delays in the action. These include the filing of various objections challenging the jurisdiction of the Court to hear and determine the suit. Essentially, tobacco companies have not denied any wrongdoing in manufacturing, distribution and marketing of deleterious and addictive tobacco products to underage persons. Their simple objection is about the form of commencement of the action and the exercise of the Court’s discretionary powers under law to order the issuance and service of writs of summons.

In about 3 years while the various preliminary objections were pending before the Court, tobacco companies intensified their manufacturing, distribution and marketing of cigarettes in Kano State. Tobacco companies’ huge profitability comes at a very great cost to Kano State in terms of expenditure on treatment of tobacco related diseases in government hospitals and the depletion of the state’s work force. Tobacco companies’ sales statistics shows that tobacco consumption in Nigeria increased tremendously and income increased by N17,552,200,000 billion from about N92,000,000,000 billion between 2007 and December, 2009. The result of the leap in tobacco companies’ profitability is a corresponding catastrophic increase in the prevalence of tobacco smoking, smoking diseases and mortality. 

The Ruling of the Court on Jurisdictional Objections on 16th April, 2010 and Current Procedural Posture 

The rulings of Hon. Justice Wada Abubakar Omar of the Kano State High Court on tobacco companies’ jurisdictional objections hatched a new hope for definitive governmental actions to curb tobacco prevalence and mortality in Nigeria. In three separate rulings in respect of preliminary objections filed by the ITC, BAT PLC and BAT Investments Ltd, the learned judge held that it has jurisdiction to hear and determine the suit and the Court dismissed the preliminary objections dated 3rd August, 2007, 19th September, 2007 and 3rd July, 2007 respectively. 

Specifically, the Court dismissed ITC’s objection to jurisdiction on the ground that Kano State failed to obtain prior leave of court to issue and serve the writ under Order 5 Rule 14 of the High Court of Kano State (Civil Procedure Rules) 1988 and that the writ was not endorsed for service out of jurisdiction as required by Sections 97 and 99 of the Sheriff and Civil Process Act. The Court upheld the submission of Counsel on behalf of Kano State that Order 5 Rule 14 does not apply to service of Court processes on ITC, a company in Nigeria because the phrase “out of jurisdiction” under the rules refers only to service outside of the Federal Republic of Nigeria. Regarding the alleged non-compliance with the Sheriff and Civil Process Act, the learned judge, relying on relevant decisions of the Supreme Court, held that it is the duty of the Registrar to endorse the writ as appropriate. As a result, the Court concluded that an omission to endorse the writ cannot invalidate the action.

On BAT Plc’s objection that there is no foundation for Kano State’s allegation that it committed a tort in Kano State, the Court held as follows:

“I think what the 3rd Defendant has done seems to be an invitation for the Court to comment on the substantive issue before the Court as rightly observed by the Plaintiff in their written address. It should also be noted that before this Court did grant the ex parte application of the Plaintiff and made the order complained of, the Court had been fully satisfied with the material at its disposal. As the said order is not a nullity ab initio, I cannot appreciate any reason why same should be reversed at this juncture. Issue number 1 formulated by the 3rd Defendant/Applicant should be and is hereby resolved against it.” 

In response to BAT Plc’s request to set aside the order of the Court which authorized the service of Court processes on BAT Plc, the Court held as follows: 

In my opinion, to determine whether the Plaintiff has pleaded sufficient facts to establish any conduct by the 3rd Defendant that could constitute a tort or other civil wrong, the statement of claim of the Plaintiff must be examined thereby digressing into the substantive case at this stage of procedural challenge on the jurisdiction of this Court. It will be quite inappropriate to comment on the substantive case now. After all, this Court was fully satisfied with the relevant materials placed before it before it made the order granting leave to serve the writ outside the jurisdiction. I will not delve into the substantive case for the purpose of vacating the said order which is not a nullity by any stretch of imagination. 

The ruling of the Court on BAT Plc’s objection is consistent with the guidance laid down by the Supreme Court of Nigeria. In all cases, Courts faced with interlocutory applications have been urged to refrain from prejudging the issues for determination at the substantive trial of the action.

The last thread of objections by BAT Investment Plc are closely related with objections raised by BAT Plc. BAT Investment however further contended that the Court is precluded from asserting jurisdiction on the ground that the service of processes was defective under the Sheriff and Civil Processes Act. The Court dismissed the contention as follows: 

The writ of summons in this case was to be served on the 4th Defendant outside the jurisdiction of this Court, and it was so served. The 4th Defendant was served out of the Federal Republic of Nigeria. The question is, is service on the 4th Defendant governed by the provisions of the Sheriff and Civil Process Act? This question has been effectively answered in the case of NNPC v. Anwuta (2000) 13 NWLR pt. 682 at 376 cited at page 21….The 4th Defendant that is residing out of Nigeria could not rely on non-compliance with Sections 97 and 99 of the Sheriffs and Civil Process Act as a ground to vitiate the service of the writ of summons on it. This is because service on the 4th Defendant as a person resident outside Nigeria is governed by the Kano State High Court (Civil Procedure) Rules 1988, not the Sheriffs and Civil Process Act. 

In sum, after hearing the various preliminary challenges filed by the Defendants, the Court firmly established that it has both personal and territorial jurisdiction to hear and determine this suit. The ruling on the Court marked the end of a phase in tobacco companies’ deliberate use of technicalities to defeat substantive justice in the pending action against them for causing injury to public health in Kano State.