CENTER FOR LAWS OF NIGERIA: FEDERAL LAWS
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MARINE INSURANCE ACT
Arrangement of sections
1. | Short title, etc. |
Preliminary
2. | Interpretation. | 3. | Marine insurance defined. | 4. | Mixed sea and land risks. |
5. | Marine adventure and maritime perils defined. |
Insurable Interest
6. | Avoidance of wagering or gaming contracts. | 7. | Insurable interest defined | 8. | When interest attaches. | |
9. | Defeasible or contingent interest. | 10. | Partial interest. | 11. | Re-insurance | |
12. | Bottomry. | 13. | Master’s and seamen’s wages. | 14. | Advance freight. | |
15. | Charges of insurance. | 16. | Quantum of interest. | 17. | Assignment of interest. |
Insurable Value
18. | Measure of insurable value. |
Disclosure and representations
19. | Insurance is uberrimae fidei. | 20. | Disclosure by assured. | 21. | Disclosure by agent effecting insurance. |
22. | Representations pending negotiation of contract. | 23. | When contract deemed to be concluded. |
The Policy
24. | Contract to be embodied in policy. | 25. | What policy must specify. | 26. | Signature of insurer. |
27. | Voyage and time policies. | 28. | Designation of subject-matter. | 29. | Valued policy. |
30. | Unvalued policy. | 31. | Floating policy by ship or ships. | 32. | Premium to be arranged. |
Double Insurance
33. | Double insurance. |
Warranties, etc
34. | Nature of warranty. | 35. | When breach of warranty excused. | 36. | Express warranties. |
37. | Warranty of neutrality. | 38. | No implied warranty of nationality. | 39. | Warranty of good safety. |
40. | Warranty of seaworthiness of ship. | 41. | No implied warranty that goods are seaworthy. | 42. | Warranty of legality. |
The Voyage
44. | Alteration of port of departure. | 45. | Sailing for different destination. | 46. | Change of voyage. |
47. | Deviation. | 48. | Several ports of discharge. | 50. | Excuses for deviation or delay. |
Assignment of policy
51. | When and how policy is assignable. | 52. | Assured who has no interest cannot assign. |
The Premium
53. | When premium payable. | 54. | Policy effected through broker. | 55. | Effect of receipt on policy. |
Loss and Abandonment
56. | Included and excluded losses. | 57. | Total and partial loss. | 58. | Actual total loss. |
59. | Missing ship. | 60. | Effect of transhipment, etc. | 61. | Constructive total loss defined. |
62. | Effect of constructive total loss. | 63. | Notice of abandonment. | 64. | Effect of abandonment. |
Partial losses including salvage and general average and particular charges
65. | Particular average loss. | 66. | Salvage charges. | 67. | General average loss. |
Measure of indemnity
68. | Extent of liability of insurer for loss. | 69. | Total loss. | 70. | Partial loss of ship. |
71. | Partial loss of freight. | 72. | Partial loss of goods, merchandise, etc. | 73. | Apportionment of valuation. |
74. | General average contributions and salvage charges. | 75. | Liabilities to third parties. | 76. | General provisions as to measure of indemnity. |
77. | Particular average warranties. | 78. | Successive losses. | 79. | Suing and labouring clause. |
Rights of Insurer on Payment
80. | Right of subrogation. | 81. | Right of contribution. | 82. | Effect of under insurance. |
Return of Premium
83. | Enforcement of return. | 84. | Return by agreement. | 85. | Return for failure of consideration. |
Mutual Insurance
86. | Modification in case of mutual insurance. |
Supplemental
87. | Ratification by assured. | 88. | Implied obligations varied by agreement or usage. | 89. | Slip as evidence. |
90. | Gambling on loss by maritime perils prohibited. | 91. | Repeals and savings. |
First Schedule
Form of Policy
Marine Insurance Act
CITATION
An Act to provide for marine insurance and to prohibit gambling on loss by maritime perils.
Preliminary
“Action” includes counter-claim and set-off;
“freight” includes the profit derivable by a ship owner from the employment of his ship to carry his own goods or movables, as well as freight payable by a third party, but does not include passage money;
“Movables” means any moveable tangible property other than the ship and includes money, valuable securities and other documents;
“Policy” means a marine policy;
“Prescribed form” means the form of Policy in the First Schedule
(2) For the purposes of this Act, where there is a reference to
(a) reasonable time; or
(b) reasonable premium; or
(c) reasonable diligence,
The question of what is reasonable shall be a question of fact.
(2) Where a ship in course of building, or the launch of a ship, or any adventure analogous to a marine adventure, is covered by a policy in the form of a marine policy, the provisions of this Act, in so far as applicable, shall apply thereto; but, except as by this section provided, nothing in this Act shall alter or affect any rule of law applicable to any contract of insurance other than a contract of marine insurance as defined in section 3 of this Act.
(2) In particular there is a marine adventure where-
(a) any ship goods or other moveables are exposed to maritime perils, such property being referred to in this Act as insurable property;
(b) the earning or acquisition of any freight, passage money, commission, profit, or other pecuniary benefit, or the security for any advances, loan, or disbursements, is endangered by the exposure of insurable property to maritime perils;
(c) any liability to a third party may be incurred by the owner of, or other person interested in or responsible for, insurable property, by reason of maritime perils.
(3) For the purposes of this section, “maritime perils” means the perils consequent on, or incidental to, the navigation of the sea, that is to say, perils of the seas, fire, war perils, pirates, rovers, thieves, captures, seizures, restraints, and detainments of princes and peoples, jettisons, barratry, and any other perils, either of the like kind or which may be designated by the policy.
Insurable Interest
(2) A contract of marine insurance shall be deemed to be a gaming or wagering contract-
(a) where the assured has not an insurable interest as defined by this Act, and the contract is entered into with no expectation of acquiring such an interest; or
(b) where the policy is made “interest or no interest,” or “without further proof of interest than the policy itself,” or “without benefit of salvage to the insurer,” or subject to any other like term:
Provided that, where there is no possibility of salvage, a policy may be effected without benefit of salvage to the insurer.
(2)` In particular a person is interested in a marine adventure where he stands in any legal or equitable relation to the adventure or to any insurable property at risk therein, in consequence of which he may benefit by the safety or due arrival of insurable property, or may be prejudiced by its loss, or damage thereto, or by the detention thereof, or may incur liability in respect thereof.
Provided that where the subject-matter is insured “lost or not lost”, the assured may recover although he may not have acquired his interest until after the loss, unless at the time of effecting the contract of insurance the assured was aware of the loss, and the insurer was not.
(2) Where the assured has no interest at the time of the loss, he cannot acquire interest by any act or election after he is aware of the loss.
9.(1) A defeasible interest shall be insurable, as also shall be a contingent interest.
(2) In particular, where the buyer of goods has insured them, he has an insurable interest, notwithstanding that he might, at his election, have rejected the goods, or have treated them as at the seller’s risk, by reason of the latter’s delay in making delivery or otherwise.
(2) A mortgagee, consignee, or other person having an interest in the subject-matter insured may insure on behalf and for the benefit of other persons interested as well as for his own benefit.
(3) The owner of insurable property has an insurable interest in respect of the full value thereof, notwithstanding that some third person may have agreed, or be liable, to indemnify him in case of loss.
(2) Nothing in this section shall affect a transmission of interest by operation of law.
Insurable Value
(a) in insurance on ship, the insurable value which, in the case of a steamship, includes also the machinery, boilers, and coals and engine stores if owned by the assured, and, in the case of a ship engaged in a special trade, the ordinary fittings requisite for that trade, is the value, at the commencement of the risk, of the ship, including her outfit, provisions and stores for the officers and crew, money advanced for seamen’s wages, and other disbursements (if any) incurred to make the ship fit for the voyage or adventure contemplated by the policy plus the charges of insurance upon the whole;
(b) in insurance on freight, whether paid in advance or otherwise, the insurable value is the gross amount of the freight at the risk of the assured, plus the charges of insurance;
(c) in insurance on goods or merchandise, in insurable value is the prime cost of the property insured, plus the expenses of and incidental to shipping and the charges of insurance upon the whole;
(d) in insurance on any other subject-matter, the insurable value is the amount at the risk of the assured when the policy attaches, plus the charges of insurance.
Disclosure and representations
(2) Every circumstance is material which would influence the judgment of a prudent insurer in fixing the premium, or determining whether he will take the risk.
(3) In the absence of inquiry the following circumstances need not be disclosed, namely-
(a) any circumstance which diminishes the risk;
(b) any circumstance which is known or presumed to be known to the insurer, and for the purposes of this paragraph, the presumption shall extend and apply to matters of common notoriety or knowledge, and to matters which an insurer in the ordinary course of his business, as such, ought to know;
(c) any circumstance as to which information is waived by the insurer;
(d) any circumstance which is superfluous to disclose by reason of any express or implied warranty
(4) For the purposes of this section, “circumstance” includes any communication made to, or information received by, the assured; and whether any particular circumstance which is not disclosed, is material or not is, in each case a question of fact.
(a) every material circumstance which is known to the agent, who shall be deemed to know every circumstance which, in the ordinary course of business, ought to be known by or to have been communicated to the agent; and
(b) every material circumstance which the assured is bound to disclose unless it comes to the knowledge of the assured too late to communicate it to the agent.
(2) A representation is material which would influence the judgment of a prudent insurer in fixing the premium, or determining whether he will take the risk.
(3) A representation may be either a representation as to a matter of fact, or as to a matter of expectation or belief.
(4) A representation as to matter of fact is true, if it is substantially correct, that is to say, if the difference between what is represented and what is actually correct would not be considered material by a prudent insurer.
(5) A representation as to a matter of expectation or belief is true if it is made in good faith.
(6) A representation may be withdrawn or corrected before the contract is concluded.
(7) Whether a particular representation is material or not is, in each case, a question of fact.
The Policy
(2) The policy may be executed and issued either at the time when the contract is concluded, or afterwards; and subject to the provisions of this Act and unless the context of the policy otherwise requires, the terms and expressions mentioned in the First Schedule to this Act shall be construed as having the scope and meaning in that Schedule assigned to them.
(3) Nothing in this section shall affect the operation of a contract for such insurance as is mentioned in section 368 of the Merchant Shipping Act.
(2) Where a policy is subscribed by or on behalf of two or more insurers, each subscription, unless the contrary is expressed, shall constitute a distinct contract with the assured.
(3) Nothing in this section shall be construed as requiring the subscription of a corporation to be under seal.
(2) Where the policy designates the subject-matter insured in general terms, it shall be construed to apply to the interest intended by the assured to be covered.
(3) In the application of this section, regard shall be had to any usage regulating the designation of the subject-matter insured.
(2) Subject to the provisions of this Act, and in the absence of fraud, the value fixed by the policy is, as between the insurer and assured, conclusive of the insurable value of the subject intended to be insured, whether the loss is total or partial.
(3) Unless the policy otherwise provides, the value fixed by the policy is not conclusive for the purposes of determining whether there has been a constructive total loss.
(2) The subsequent declaration or declarations may be made by indorsement on the policy, or in other customary manner.
(3) Unless the policy otherwise provides, the declarations shall be made in the order of dispatch or shipment. In the case of goods they shall comprise all consignments within the terms of the policy, and the value of the goods or other property shall be honestly stated; but any omission or erroneous declaration may be rectified even after loss or arrival, provided the omission or declaration was made in good faith.
(4) Unless the policy otherwise provides, where a declaration of value is not made until after notice of loss or arrival, the policy shall be treated as an unvalued policy as regards the subject-matter of that declaration.
(2) Where an insurance is effected on the terms that an additional premium is to be arranged in a given event, and that event happens but no arrangement is made, then a reasonable additional premium shall be payable.
Double Insurance
(2) Where the assured is over-insured by double insurance-
(a) the assured, unless the policy otherwise provides, may claim payment from the insurers in such order as he may think fit, provided that he shall not be entitled to receive any sum m excess of the indemnity allowed by this Act;
(b) where the policy under which the assured claims is a valued policy, the assured shall give credit as against the valuation for any sum received by him under any other policy without regard to the actual value of the subject-matter insured;
(c) where the policy under which the assured claims is an unvalued policy he shall give credit, as against the full insurable value, for any sum received by him under any other policy;
(d) where the assured receives any sum in excess of the indemnity allowed by this Act, he shall be deemed to hold such sum in trust for the insurers, according to their right of contribution among themselves.
Warranties, etc
(2) A warranty within the meaning of this section may be express or implied, and is a condition which shall be exactly complied with, whether it is material to the risk or not. If it is not so complied with, then, subject to any express provision in the policy, the insurer shall be discharged from liability as from the date of the breach of warranty, but without prejudice to any liability incurred by him before that date.
(2) Where a warranty is broken, the fact that the breach has been remedied and the warranty complied with before loss shall be no defence to the assured; but a breach of warranty may be waived by the insurer.
(2) An express warranty shall be included in or written upon the policy, or be contained in some document incorporated by reference into the policy.
(3) An express warranty shall not exclude an implied warranty, unless it is inconsistent therewith.
(2) Where a ship is expressly warranted “neutral” there is also an implied condition that, so far as the assured can control the matter, she shall be properly documented, that is to say, that she shall carry the necessary papers to establish her neutrality, and that she shall not falsify or suppress her papers, or use simulated papers. If any loss occurs through breach of this condition, the insurer may avoid the contract.
(2) Where the policy attaches while the ship is in port, there is also an implied warranty that she shall, at the commencement of the risk, be reasonably fit to encounter the ordinary perils of the port.
(3) Where the policy relates to a voyage which is performed in different stages, during which the ship requires different kinds of or further preparation or equipment, there is an implied warranty that at the commencement of each stage the ship is seaworthy in respect of such preparation or equipment for the purposes of that stage.
(4) A ship is deemed to be seaworthy when she is reasonably fit in all respects to encounter the ordinary perils of the seas of the adventure insured.
(5) In a time policy there is no implied warranty that the ship shall be seaworthy at any stage of the adventure, but where, with the privity of the assured the ship is sent to sea in an unseaworthy state, the insurer is not liable for any loss attributable to un-seaworthiness.
(2) In a voyage policy on goods or other movables there is an implied warranty that at the commencement of the voyage the ship is not only seaworthy as a ship, but also that she is reasonably fit to carry the goods or other moveables to the destination contemplated by the policy.
The Voyage
(2) The implied condition may be negated by showing that the delay was caused by circumstances known to the insurer before the contract was concluded, or by showing that he waived the condition.
(2) Unless the policy otherwise provides, where there is a change of voyage, the insurer is discharged from liability as from the time of change, that is to say, as from the time when the determination to change it is manifested and it is immaterial that the ship may not in fact have left the course of voyage contemplated by the policy when the loss occurs.
(2) There is a deviation from the voyage contemplated by the policy-
(a) where the course of the voyage is specifically designated by the policy, and that course is departed from; or
(b) where the course of the voyage is not specifically designated by the policy, but the usual and customary course is departed from.
(3) The intention to deviate is immaterial and if there is a deviation in fact the insurer is discharged from his liability under the contract.
(2) Where the policy is to “ports of discharge” within a given area and they are not named, the ship shall, in the absence of any usage or sufficient cause to the contrary, proceed to them or such of them as she goes to, in their geographical order; and if she does not, there is a deviation.
(a) where authorised by any special term in the policy; or
(b) where caused by circumstances beyond the control of the master and his employer; or
(c) where reasonably necessary in order to comply with an express or implied warranty; or
(d) where reasonably necessary for the safety of the ship or subject-matter insured; or
(e) for the purpose of saving human life, or aiding a ship in distress where human life may be in danger; or
(f) where reasonably necessary for the purpose of obtaining medical or surgical aid for any person on board the ship; or
(g) where caused by the barratious conduct of the master or crew, if barratry is one of the perils insured against.
(2) When the cause excusing the deviation or delay ceases to operate, the ship shall resume her course, and prosecute her voyage with reasonable dispatch.
Assignment of policy
(2) Where a marine policy has been assigned so as to pass the beneficial interest in such policy, the assignee of the policy shall be entitled to sue thereon in his own name; and the defendant shall be entitled to make any defence arising out of the contract which he would have been entitled to make if the action had been brought in the name of the person by or on behalf of whom the policy was effected.
(3) A marine policy may be assigned by endorsement thereon or in other customary manner.
(2) Nothing in this section shall be construed so as to affect the assignment of a policy after loss.
The Premium
(2) Unless otherwise agreed, the broker has, as against the assured, a lien upon the policy for the amount of the premium and his charges in respect of effecting the policy, and, where he has dealt with the person who employs him as a principal, he has also a lien on the policy in respect of any balance on any insurance account which may be due to him from such person, unless when the debt was incurred he had reason to believe that such person was only an agent.
56.(1) Subject to the provisions of this Act and unless the policy otherwise provides, the insurer shall be liable for any loss proximately caused by a peril insured against, but, subject, as aforesaid, he shall not be liable for any loss which is not proximately caused by a peril insured against.
(2) In particular-
(a) the insurer shall not be liable for any loss attributable to the wilful misconduct of the assured, but unless the policy otherwise provides, he shall be liable for any loss proximately caused by a peril insured against, even though the loss would not have happened but for the misconduct or negligence of the master or crew;
(b) unless the policy otherwise provides, the insurer on ship or goods shall not be liable for any loss proximately caused by delay, although the delay be caused by a peril insured against;
(c) unless the policy otherwise provides, the insurer shall not be liable for ordinary wear and tear, ordinary leakage and breakage, inherent vice or nature of the subject-matter insured, or for any loss proximately caused by rats or vermin, or for any injury to machinery not proximately caused by maritime perils.
(2) Unless a different intention appears from the terms of the policy, an insurance against total loss includes a constructive, as well as an actual total loss.
(3) Where the assured brings an action for a total loss and the evidence proves only a partial loss, he may, unless the policy otherwise provides, recover for a partial loss.
(4) Where goods reach their destination in specie, but by reason of obliteration of marks, or otherwise, they are incapable of identification, the loss, if any, is partial, and not total.
(2) In the case of an actual total loss no notice of abandonment need be given.
(2) In particular, there is a constructive total loss-
(a) where the assured is deprived of the possession of his ship or goods by a peril insured against; and
(i) it is unlikely that he can recover the ship or goods as the case may be, or
(ii) the cost of recovering the ship or goods as the case may be would exceed their value when recovered; or
(b) in the case of damage to a ship, where she is so damaged by a peril insured against that the cost of repairing the damage would exceed the value of the ship when repaired; and for the purposes of this paragraph, in estimating the cost of repairs, no deduction is to be made in respect of general average contributions to those repairs payable by other interests, but account is to be taken of the expenses of future salvage operations, and of any future general average contributions to which the ship would be liable if repaired; or
(c) in the case of damage to goods, where the cost of repairing the damage and forwarding the goods to their destination would exceed their value on arrival.
(2) Notice of abandonment may be given in writing, or by word of mouth, or partly in writing and partly by word of mouth, and may be given in terms which indicate the intention of the assured to abandon his insured interest in the subject-matter insured unconditionally to the insurer.
(3) Notice of abandonment shall be given with reasonable diligence after the receipt of reliable information of the loss, but where the information is of a doubtful character the assured is entitled to a reasonable time to make inquiry.
(4) Where notice of abandonment is properly given, the rights of the assured shall not be prejudiced by the fact that the insurer refuses to accept the abandonment.
(5) The acceptance of abandonment may be either express or implied from the conduct of the insurer, but the mere silence of the insurer after notice shall not be construed as an acceptance.
(6) Where notice of abandonment is accepted the abandonment is irrevocable, and the acceptance of the notice shall be construed as conclusive admission of liability for the loss and the sufficiency of the notice.
(7) Notice of abandonment shall be unnecessary where, at the time when the assured receives the information of the loss, there would be no possibility of benefit to the insurer if notice were given to him.
(8) Notice of abandonment may be waived by the insurer.
(9) Where an insurer has re-insured his risk, no notice of abandonment need be given by him.
(2) Upon the abandonment of a ship, the insurer thereof shall be entitled to any freight in course of being earned, and which is earned by her subsequent to the casualty causing the loss, less the expenses of earning it incurred after the casualty; and, where the ship is carrying the owner’s goods, the insurer shall be entitled to a reasonable remuneration for the carriage of them subsequent to the casualty causing the loss.
Partial Losses (including salvage and general average and particular charges)
(2) Expenses incurred by or on behalf of the assured for the safety or preservation of the subject-matter insured other than general average and salvage charges, are called particular charges, and are not included in particular average.
(2) For the purposes of this section, “salvage charges” means the charges recoverable under maritime law by a salvor independently of contract, but does not include expenses of services in the nature of salvage which are recoverable, if properly incurred, as particular charges of general average loss, as the case may be, where rendered by the assured or his agents, or any person employed for hire by them, for the purpose of averting a peril insured against.
(2) There is a general average act where any extraordinary sacrifice or expenditure is voluntarily and reasonably made or incurred in time of peril for the purpose of preserving the property imperilled in the common adventure.
(3) Where there is a general average loss, the party on whom it falls shall be entitled, subject to the conditions imposed by maritime law, to a rateable contribution, called a general average contribution, from the other parties interested.
(4) Subject to any express provision in the policy, where the assured has incurred a general average expenditure, he may recover from the insurer in respect of the proportion of the loss which falls upon him; and, in the case of a general average sacrifice, he may recover from the insurer in respect of the whole loss without having enforced his right of contribution from the other parties liable to contribute.
(5) Subject to any express provision in the policy, where the assured has paid, or is liable to pay, a general average contribution in respect of the subject insured, he may recover therefore from the insurer.
(6) In the absence of express stipulation, the insurer shall not be liable for any general average loss or contribution where the loss was not incurred for the purpose of avoiding, or in connection with the avoidance of, a peril insured against.
(7) Where ship, freight, and cargo, or any two of those interests, are owned by the same assured, the liability of the insurer in respect of general average losses or contributions shall be determined as if those subjects were owned by different persons.
Measure of indemnity
(2) For the purposes of this section “measure of indemnity” means the sum which the assured may recover in respect of a loss on a policy by which he is insured, being in the case of a valued policy the full extent of the value fixed by the policy, and in the case of an unvalued policy, the full extent of the insurable value.
(a) if the policy is a valued policy, the measure of indemnity shall be the sum fixed by the policy;
(b) if the policy is an unvalued policy, the measure of indemnity shall be the insurable value of the subject-matter insured.
(a) where the ship has been repaired, the assured shall be entitled to the reasonable cost of the repairs, less the customary deductions, but not exceeding the sum insured in respect of any one casualty;
(b) where the ship has been only partially repaired, the assured shall be entitled to the reasonable cost of such repairs, computed as above, and be indemnified for the reasonable depreciation, if any, arising from the unrepaired damage, provided that the aggregate amount shall not exceed the cost of repairing the whole damage, computed as above;
(c) where the ship has not been repaired, and has not been sold in her damaged state during the risk, the assured shall be entitled to be indemnified for the reasonable depreciation arising from the unrepaired damage, but not exceeding the reasonable cost of repairing such damage, computed as above.
(a) where part of the goods, merchandise or other moveables insured by a valued policy is totally lost, the measure of indemnity shall be such proportion of the sum fixed by the policy as the insurable value of the part lost bears to the insurable value of the whole, ascertained as in the case of an unvalued policy;
(b) where part of the goods, merchandise, or other moveables insured by an unvalued policy is totally lost, the measure of indemnity shall be the insurable value of the part lost, ascertained as in case of total loss;
(c) where the whole or any part of the goods or merchandise insured has been delivered damaged at its destination, the measure of indemnity shall be such proportion of the sum fixed by the policy in the case of a valued policy, or of the insurable value in the case of an unvalued policy, as the difference between the gross sound and damaged values at the place of arrival bears to the gross sound value.
(2) For the purposes of this section-
“Gross value” means the wholesale price or, if there is no such price, the estimated value, with in either case, freight, landing charges, and duty paid before-hand, provided that, in the case of goods or merchandise customarily sold in bond, the bonded price shall be deemed to be the gross value;
“Gross proceeds” means the actual price obtained at a sale where all charges on sale are paid by the sellers.
(2) Where a valuation is to be apportioned, and particulars of the prime cost of each separate species, quality, or description of goods are not ascertainable, the division of the valuation may be made over the net arrived sound values of the different species, qualities, or descriptions of goods.
(2) Where the insurer is liable for salvage charges the extent of his liability shall be determined on the like principle.
(2) Nothing in this Act relating to the measure of indemnity shall affect the rules relating to double insurance, or prohibit the insurer from disproving interest wholly or in part, or from showing that at the time of the loss the whole or any part of the subject-matter insured was not at risk under the policy.
(2) Where the subject-matter insured is warranted flee from particular average, either wholly or under a certain percentage, the insurer shall nevertheless be liable for salvage charges; and the insurer shall also be liable for particular charges for and other expenses of averting a loss insured against, where properly incurred pursuant to the provisions of a suing and labouring clause to the like effect as set out in the prescribed form, if contained in the policy.
(3) Unless the policy otherwise provides, where the subject-matter insured is warranted flee from particular average under a specified percentage, a general average loss shall not be added to a particular average loss to make up the specified percentage.
(4) For the purpose of ascertaining whether the specified percentage has been reached, regard shall be had only to the actual loss suffered by the subject-matter insured, and particular charges and the expenses of and incidental to ascertaining and proving the loss shall be excluded.
(2) Where, under the same policy, a partial loss, which has not been repaired or otherwise made good, is followed by a total loss, the assured may recover in respect only of the total loss.
(3) Nothing in this section shall affect the liability of an insurer under a suing and labouring clause in the prescribed form or to the like effect if contained in the policy.
(2) General average losses and contributions and salvage charges, as defined by this Act, shall not be recoverable under the suing and labouring clause.
(3) Expenses incurred for the purpose of averting or diminishing any loss not covered by the policy shall not be recoverable under the suing and labouring clause.
(4) It shall be the duty of the assured and his agents, in all cases, to take such measures as may be reasonable for the purpose of averting or minimising a loss.
Rights on payment
(2) Subject to the foregoing provisions, where the insurer pays for a partial loss, he shall acquire no title to the subject-matter insured, or such part of it as may remain, but shall thereupon be subrogated to all rights and remedies of the assured in and in respect of the subject-matter insured as from the time of the casualty causing the loss, in so far as the assured has been indemnified, according to this Act, by such payment for the loss.
(2) If any insurer pays more than his proportion of the loss, he shall be entitled to maintain an action for contribution against the other insurers, and be entitled to the like remedies as a surety who has paid more than his proportion of the debt.
Return of premium
(a) if already paid, it may be recovered by the assured from the insurer; and
(b) if unpaid, it may be retained by the assured or his agent.
(2) Where the consideration for the payment of the premium is apportionable and there is a total failure of any apportionable part of the consideration, a proportionate part of the premium shall, under the like conditions be returned to the assured.
(3) In particular-
(a) where a policy is void, or is avoided by the insurer as from the commencement of the risk, the premium shall be returnable, provided that there has been no fraud or illegality on the part of the assured; but if the risk is not apportionable, and has once attached, the premium shall not be returnable;
(b) where the subject-matter insured, or part thereof, has never been imperilled, the premium, or, as the case may be, a proportionate part thereof, shall be returnable:
Provided that where the subject matter has been insured “lost or not lost” and has arrived in safety at the time when the contract is concluded, the premium shall not be returnable unless, at such time, the insurer knew of the safe arrival;
(c) where the assured has no insurable interest throughout the currency of the risk, the premium shall be returnable, but nothing in this paragraph shall be construed to apply to a policy effected by way of gaming or wagering;
(d) where the assured has a defeasible interest which is terminated during the currency of the risk, the premium shall not be returnable;
(e) where the assured has over-insured under an unvalued policy, a proportionate part of the premium shall be returnable.
(4) Subject to the foregoing provisions of this section, where the assured has over-insured by double insurance, a proportionate part of the several premiums shall be returnable:
Provided that, if the policies are effected at different times, and any earlier policy has at anytime borne the entire risk, or if a claim has been paid on the policy in respect of the full sum insured thereby, no premium shall be returnable in respect of that policy, and when the double insurance is effected knowingly by the assured no premium shall be returnable.
Mutual Insurance
(2) The provision of this Act relating to the premium shall not apply to mutual insurance, but a guarantee, or such other arrangement as may be agreed upon, may be substituted for the premium.
(3) The provisions of this Act, in so far as they may be modified by the agreement of the parties, may in the case of mutual insurance be modified by the terms of the policies issued by the association, or by the rules and regulations of the association.
(4) Subject to the exceptions mentioned in this section, the provisions of this Act apply to a mutual insurance.
Supplemental
(2) The provisions of this section shall extend to any right, duty, or liability declared by this Act which may be lawfully modified by agreement.
(a) any person effects a contract of marine insurance without having any bona fide interest, direct or indirect, either in the safe arrival of the ship in relation to which the contract is made or in the safety or preservation of the subject-matter insured, or a bona fide expectation of acquiring such an interest; or
(b) any person in the employment of the owner of a ship, not being a part owner of the ship, effects a contract of marine insurance in relation to the ship and the contract is made “interest or no interest,” or “without further proof of interest than the policy itself,” or “without benefit of salvage to the insurer,” or subject to any other like term, the contract shall be deemed to be a contract by way of gambling on loss by maritime perils, and the person effecting it shall be guilty of an offence, and liable, on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding two hundred naira, and in either case to forfeit to the State any money he may have received under the contract.
(2) Any broker or other person through whom, and any insurer with whom, any such contract is effected shall be guilty of an offence and liable on summary conviction to the like penalties, if he acted knowing that the contract was by .way of gambling on loss by maritime perils within the meaning of this section.
(3) Proceedings under this section shall not be instituted without the consent of a Law Officer.
(4) Proceedings shall not be instituted under this section against a person (other than a person in the employment of the owner of the ship in relation to which the contract was made) alleged to have effected a contract by way of gambling on loss by maritime perils until an opportunity has been afforded him of showing that the contract was not such a contract as aforesaid, and any information given by that person for that purpose shall not be admissible in evidence against him in any prosecution under this section.
(5) If proceedings under this section are taken against any person (other than a person in the employment of the owner of the ship in relation to which the contract was made) for effecting such a contract, and the contract was made “interest or no interest,” or “without further proof of interest than the policy itself,” or “without benefit of salvage to the insurer,” or subject to any other like term, the contract shall be deemed to be a contract by way of gambling on loss by maritime perils unless the contrary is proved.
(6) For the purpose of giving jurisdiction under this section, every offence shall be deemed to have been committed either in the place in which the same actually was committed or in any place in which the offender may be.
(7) Any person aggrieved by an order or decision of a court of summary jurisdiction under this section may appeal to the High Court.
(8) For the purposes of this section, the expression “owner” includes charterer.
(2) Nothing in this Act or in any repeal effected thereby, shall affect-
(a) the provisions of the Stamp Duties Act or any enactment for the time being in force relating to the revenue;
(b) the provisions of the Companies and Allied Matters Act or any enactment amending or substituted for the same;
(c) the provisions of any statute not expressly repealed by this Act
(3) The rules of the common law of England, to the extent to which they are in force in Lagos under the Interpretation Act shall, for the purposes of this Act, be in force m all States of Nigeria; and save in so far as they are inconsistent with the express provisions of this Act, shall continue to apply to contracts of marine insurance.
(4) To give effect to subsection (3) of this section in any State, the rules of the common law shall where necessary be deemed to have been duly revived; and for the removal of doubts, and subject to the provisions of this subsection, the usages of the law merchant in England shall be deemed to be part of the common law and be construed with and form part of this Act.
(5) For the purposes of subsections (3) and (4) of this section, “State” includes the Federal Capital Territory Abuja.
Schedules
Form of Policy
Be it known that……………….. as well in……………….. own name as for and in the name and names of all and
every other person or persons to whom the same doth, may, or shall appertain, in part or in all doth make assurance and cause ……………..and them, and every of them, to be insured lost or not lost, at and from
………………………………………………………………………………………….
Upon any kind of goods and merchandise, and also upon the body, tackle, apparel, ordnance, munitions, artillery, boat, and other furniture, of and in the good ship or vessel called the …………. whereof is master under God, for this present voyage,. ………………… or whosoever else shall go for master in the said ship, or by whatsoever other name or names the said ship, or the master thereof, is or shall be named or called; beginning the adventure upon the said goods and merchandises from the loading thereof aboard the said ship ……………. upon the said ship, etc., and so shall continue and endure, during her abode there, upon the said ship, etc. And further, until the said ship with all her ordnance, tackle, apparel, etc., and goods and merchandises whatsoever shall be arrived at ……………………upon the said ship, etc., until she hath moored at anchor twenty-four hours in good safety; and upon the goods and merchandises, until the same be there discharged and safely landed. And it shall be lawful for the said ship, etc., in this voyage, to proceed and sail to and touch and stay at any ports or places whatsoever ……………………. without prejudice to this insurance. The said ship, etc., goods and merchandises, etc., for so much as concerns the assured by agreement between the assured and assurers in this policy, are and shall be valued at………………………………………………………………………….
Touching the adventures and perils which we the assurers are contented to bear and do take upon us in this voyage: they are of the seas, men of war, fire, enemies, pirates, rovers, thieves, jettisons, letters of mart and counter-mart, surprisals, takings at sea, arrests, restraints, and detainments of all kings, princes, and people, of what nation, condition, or quality soever, barratry of the master and mariners, and of all other perils, losses, and misfortunes, that have or shall come to the hurt, detriment, or damage of the said goods and merchandises, and ship, etc., or any part thereof. And in case of any loss or misfortune it shall be lawful to the assured, their factors, servants and assigns, to sue, labour, and travel for, in and about the defence, safeguards, and recovery of the said goods and merchandises, and ship, etc., or any part thereof, without prejudice to this insurance; to the charges whereof we, the assurers, will contribute each one according to the rate and quantity of his sum herein assured. And it is especially declared and agreed that no acts of the insurer or insured in recovering, saving, or preserving the property insured shall be considered as a waiver, or acceptance of abandonment. And it is agreed by us, the insurers, that this writing or policy of assurance shall be of as much force and effect as the surest writing or policy of assurance heretofore made in any place in Nigeria. And so we, the assurers, are contended, and do hereby promise and bind ourselves, each one for his own part, our heirs, executors, and goods to the assured, their executors, administrators, and assigns, for the true performance of the premises, confessing ourselves paid the consideration due unto us for this assurance by the assured, at and after the rate of ……………………………………………………………………………
In Witness whereof we, the assurers, have subscribed our names and sums assured in …………………………………………………………………………………….
N.B. – Corn, fish, salt, fruit, flour and seed are warranted free from average, unless general, or the ship be stranded; and sugar, tobacco, hemp, flax, hides and skins are warranted free from average, under ten naira per cent, and all other goods, also the ship and freight, are warranted free from average, under six naira per cent unless general, or the ship be stranded.
Rules for Construction of Policy
(b) If she be not at that place when the contract is concluded, the risk attaches as soon as she arrives there in good safety, and, unless the policy otherwise provides, it is immaterial that she is covered by another policy for a specified time after arrival.
(c) Where chartered freight is insured “at and from” a particular place, and the ship is at that place in good safety when the contract is concluded the risk attaches immediately. If she be not there when the contract is concluded, the risk attaches as soon as she arrives there in good safety.
(d) Where freight, other than chartered freight, is payable without special conditions and is insured “at and from” a particular place, the risk attaches pro rata as the goods or merchandise are shipped; provided that if there be cargo in readiness which belongs to the ship owner, or which some other person has contracted with him to ship, the risk attaches as soon as the ship is ready to receive such cargo.
LOCAL LOANS (REGISTERED STOCK AND SECURITIES) ACT
ARRANGEMENT OF SECTIONS
PART I
Preliminary
PART II
Power to raise loans
PART III
Registered stock
PART IV
Bearer bonds
PART V
Payment of interest and redemption of stock and securities
PART VI
Sinking funds
SECTION
PART VII
Conversion of loans
PARTVIII
Issue of duplicates and renewals of stock certificates and securities and exchange and consolidation
PART IX
Miscellaneous
LOCAL LOANS (REGISTERED STOCK AND SECURITIES) ACT
An Act to make provision for the creation and issue of registered stock, Government
promissory notes and bearer bonds for the purpose of raising loans in Nigeria.
[9 of 1946. 5 of 1949. Cap. 111 of 1958. 1959 No. 8. 1976 No. 32. 1979 No. 63.]
[4th July, 1946] [Commencement.]
PART I
Preliminary
Short title
This Act may be cited as the Local Loans (Registered Stock and Securities) Act.
Interpretation
In this Act, unless the context otherwise requires-
“bearer bond” means a bearer bond issued under the provisions of this Act;
“Central Bank” means the Central Bank of Nigeria;
“register” means the register of stock kept by the Central Bank;
[1976 No. 32. 1979 No. 63.]
“Minister” means the Minister for the time being charged with responsibility for matters relating to finance;
“registered stock” or “stock” means Nigeria stock issued under the provisions of this Act;
“security” means a bearer bond;
“stockholder” means a person holding registered stock who is entered as the owner thereof in the register.
PART II
Power to raise loans
(1) Whenever by any Act, whether enacted before or after the date on which this Act comes into operation, authority has been or is hereafter given to raise any sum of money by way of loan for any purpose mentioned in that Act, or whenever it is necessary to raise any sum of money for the purpose of repaying any loan raised by the Government under this or any other Act the Minister may, from time to time, raise such sum or any part thereof under the provisions of this Act in anyone or more of the following modes-
(a) by the creation and issue of registered stock;
(b) by the issue of securities in the form of Government promissory notes;
(c) by the issue of securities in the form of bearer bonds.
(2) Each issue of registered stock or securities under this Act for the purpose of raising any specified sum of money shall be deemed to be stock or securities issued in respect of a separate loan notwithstanding that the sum of money so raised is part only of a sum of money authorised by any other Act to be raised by way of a loan.
The principal moneys and interest represented or secured by any registered stock or securities issued under this Act are hereby charged upon and shall be payable out of the general revenue and assets of Nigeria.
(1) The Minister shall, in respect of each loan to be raised under this Act, specify by directions published in the Federal Gazette-
(a) the sum of money to be raised by that loan;
(b) the mode or modes of raising the loan;
(c) the rate of interest payable on the loan;
(d) the dates in each year on which the half-yearly interest on the loan shall be payable;
(e) the rate of which a half-yearly appropriation out of the general revenue and assets of Nigeria shall be made as a contribution to the sinking fund established for the purpose of redeeming that loan and the date from which such contributions shall commence;
(f) the date of redemption of the registered stock or securities to be issued for the purpose of raising that loan;
(g) whether the interest payable on any registered stock, Government promissory notes or bearer bonds issued under the authority of this Act shall be exempt from all or any of the taxes and duties payable under any other enactment in force in Nigeria.
(2) In the case of a loan appropriated and applied or to be appropriated and applied for lending to the Government of a State such directions shall not require the Government of the Federation to establish a sinking fund but shall specify-
(a) that the terms and conditions for such lending have been approved in accordance with paragraph (b) of section 3 of the Loan (Internal Borrowing) Act; and
(b) the rate at which a half-yearly appropriation out of the general revenue and assets of each State concerned is required.
(3) The date of redemption of any registered stock or securities shall not be later than sixty years from the date of issue of such stock or securities.
(4) Where the Minister deems it expedient to reserve an option to redeem any registered stock or securities at any date earlier than the date of redemption specified for such stock or securities by the directions under subsection (1) of this section, he shall by such
directions further specify the terms and conditions on which such stock or securities may be redeemed at any earlier date.
Upon the publication under section 5 of this Act of the directions of the Minister in respect of any loan to be raised under this Act, the Central Bank may, subject to the pro- visions of such directions and to such further directions as the Minister may give in that behalf, make all such arrangements as may be necessary to raise that loan upon the most favourable terms that can be obtained.
PART III
Registered stock
The Central Bank shall keep a register in respect of each issue of registered stock under this Act in which all such stock and all transfers of and all dealings in such stock shall be registered and in which shall be entered all matters and things which by this Act are required to be entered in the register.
The Government of Nigeria shall be bound to pay to the person registered for the time being as the stockholder, the principal sum represented by that stock and the interest due thereon, in accordance with the provisions of this Act, at the rate and on the dates directed by the Minister under section 5 of this Act or in pursuance of an option to redeem such stock reserved in such directions.
For the purposes of this Act, no person shall be entitled to any registered stock unless he is registered as a stockholder in respect thereof.
No person shall be registered as a first stockholder of any registered stock except
upon payment in full of the purchase price of that stock.
Every stockholder shall be entitled to obtain from the Central Bank a stock certificate and no stockholder, other than the first stockholder of any stock shall be entitled to obtain a stock certificate save upon payment of the prescribed fee.
(1) For the purposes of this Act, the title of any stockholder to any registered stock shall not be deemed to be transferred to any other person save upon the execution of an approved instrument of transfer and upon the registration of the transferee as the stock holder under section 13 of this Act.
(2) Interest which has fallen due in respect of any registered stock but which has not been paid to the stockholder for the time being, shall not be deemed to be payable to a transferee of that stock unless the instrument of transfer expressly provides for the payment of that interest to that transferee.
(1) No person shall be registered as the transferee of any registered stock except upon surrender to the Central Bank of the stock certificate and the instrument of transfer relating to that stock and upon payment of the prescribed fee.
(2) The Central Bank may register a lien on any registered stock in accordance with such provisions as are prescribed by regulation and upon payment of the prescribed fee.
(3) With effect from the 1st day of May 1949, any such lien which is registered under the Act shall have priority over any lien not so registered.
The register shall be closed for a period of 21 days immediately preceding each date upon which interest on that stock falIs due and no transfer of that stock shall be registered during that period.
(1) The entries in the register kept under the provisions of this Act shall be conclusive evidence of the facts, matters, particulars and transactions to which those entries relate.
(2) Notwithstanding the provisions of any other enactment, a copy of any entry in the register certified under the hand of the director of domestic operations of the Central Bank to be a true copy of the original entry shall be receivable in evidence in any judicial
proceeding unless a judge shall otherwise direct.
PART IV
Bearer bonds
(1) Every bearer bond shall be signed by the director of domestic operations of the Central Bank for and on behalf of the Government of Nigeria and shall, when issued, bind the Government of Nigeria to pay the principal sum and the interest thereon in accordance with the provisions of this Act, at the rate and on the dates specified in the directions by the Minister under section 5 of this Act or in pursuance of an option to redeem such bond reserved in such directions.
(2) Bearer bonds shall be issued in such denominations as the Minister may direct.
(1) There shall be attached to every bearer bond coupons for the payment of interest which falls due thereunder:
Provided that the number of coupons attached to a bearer bond on the date of its issue to any person may cover a period shorter than that of the currency of the bond if, in the opinion of the Central Bank, it is inconvenient or inexpedient to attach to the bond coupons sufficient in number to cover the entirety of the period of the currency of the
bond.
(2) If the number of coupons attached to any bearer bond on the date of its issue to any person is insufficient to cover all payments of interest due on the bond after that date, the holder of that bond shall be entitled to a renewal thereof at the prescribed time and in the prescribed manner and circumstances.
PART V
Payment of interest and redemption of stock and securities
So long as any interest is payable under this Act in respect of any stock or securities, the Minister shall, in each half-year ending with the date on which the interest on such stock or securities falls due, appropriate out of the general revenue and assets of Nigeria sum sufficient to meet all interest payable on that date and shall authorise the Central Bank to pay such interest out of the sum so appropriated.
(1) The interest due on any registered stock or securities shall be payable half-yearly on the dates specified by the directions of the Minister under section 5 of this Act.
(2) Where any amount has become payable on any date as interest due on any registered stock or securities, no interest on that amount shall, after that date, be paid or payable by the Government to any person in any circumstances.
No person shall be entitled to claim interest on any registered stock or securities in respect of any period which has elapsed after the earliest date on which demand could lawfully have been made for the payment of the principal amount due on such stock or securities.
All payments of interest and all payments of the principal amount due on any registered stock or securities shall be made at the Central Bank in Lagos:
Provided that the Central Bank or any person authorised by the Central Bank in that behalf may pay any such interest or principal amount at any other place, whether within or without Nigeria, in pursuance of any arrangement which the Central Bank may make for that purpose.
PART VI
Sinking funds
After the date specified in the directions of the Minister under section 5 of this Act as the date from which contributions to the sinking fund for any loan shall commence, the Minister shall, in each half-year ending with the date specified in those directions for the payment of the half-yearly interest on any stock or securities issued in respect of that loan, appropriate out of the general revenue and assets of Nigeria a sum determined in
accordance with the rate specified in those directions as the contribution to the sinking fund established for the purpose of redeeming that loan.
A separate sinking fund shall be established for each loan raised under this Act.
(1) All moneys appropriated under section 22 of this Act as contributions to the sinking fund established for any loan shall be paid to the Central Bank and may then be invested in such stock or securities or in such other investments or classes of investments as may be approved by the Minister.
(2) The Central Bank may from time to time, with the approval of the Minister, vary any investment made under subsection (1) of this section or may realise and reinvest any moneys invested under that subsection.
(3) The dividends, interest, bonus and other profits of any investment of any part of any sinking fund shall be invested by the Central Bank so as to form part of that sinking funds in like manner as moneys appropriated under section 22 of this Act as contributions to that sinking fund.
Notwithstanding anything to the contrary contained in this Act, if at any time the Central Bank is satisfied that the sinking fund of any loan raised under the provisions of this Act will be sufficient with further accumulations of interest, but without further payments of contributions, to enable the loan to be redeemed at the time fixed for its redemption, it shall inform the Minister accordingly, and the Minister is hereby authorised
in such event to suspend further payments of half-yearly contributions to that sinking fund:
Provided, however, that the contributions to that sinking fund shall be recommenced if the Central Bank at any time thereafter informs the Minister that it is no longer satisfied that the sinking fund with further accumulations of interest will be sufficient for the redemption of that loan.
There shall be paid out of the sinking fund all expenses specifically incurred in, or incidental to, the investment and management of that fund and the repayment of the loan for which that fund was established.
In the event of the sinking fund established for any loan under this Act being found, at the time fixed for the repayment of that loan, to be insufficient for such redemption, the deficiency shall be made good out of the general revenue and assets of Nigeria.
PART VII
Conversion of loans
The Minister shall have and may from time to time exercise the following powers and authorities or any of them-
(a) he may declare any stock or securities issued in Nigeria under the provisions of this or any other Act to be convertible into registered stock or other securities to be issued under the provisions of this Act;
(b) he may authorise the creation and issue under this Act of such an amount of registered stock or securities as may be necessary for the conversion of the stock or securities in respect of which a declaration has been made under paragraph (a) of this section;
(c) he may authorise the creation and issue under this Act of such registered stock or securities as may be necessary for the purpose of paying any expenses incurred in the creation and issue of registered stock or securities under this section;
(d) he may declare that all privileges, exemptions and imrnunities attaching by virtue of any enactment in force in Nigeria to any stock or securities shall attach to any new registered stock or securities issued under this Act in conversion of such earlier stock or securities.
Any conversion authorised under section 28 of this Act may be effected either by arrangement with the holders of existing stock or securities, or by purchase thereof out of moneys raised by the sale of stock or securities, or partly in one way and partly in the other.
PART VIII
Issue of duplicates and renewals of stock certificates and securities and
exchange and consolidation
(1) The Central Bank may issue duplicate stock certi ficates and duplicate securities in such circumstances as may be prescribed.
(2) The Central Bank may issue renewals of stock certificates and securities in such circumstances as may be prescribed.
The Central Bank may, in such circumstances as may be prescribed-
(a) issue a notice to the holder of any security directing him to apply for a renewal of that security; and
(b) withhold payment of the interest or principal amount due in respect of that security until the application for renewal has been made and determined.
On application made by any person claiming to be the holder of any registered stock or securities issued under this Act, the director of domestic operations of the Central Bank may, if he is satisfied that the applicant is the lawful holder of such stock or securities, and on payment of the prescribed fee, exchange stock for securities or securities for stock or securities of one kind for securities of the other kind:
Provided that-
(a) all stock and securities so given or taken in exchange shall have been issued in respect of the same loan;
(b) the nominal value of the stock or securities given by the Registrar in exchange shall be the same as the nominal value of the stock or securities taken by him in exchange.
Subject to such conditions as may be prescribed, the Central Bank may-
(a) on the application of a person claiming to be entitled to any stock or securities; and
(b) on being satisfied of the justice of the claim of such applicant; and
(c) on surrender of the stock certificate relating to such stock or of such securities receipted in the prescribed manner; and
(d) on payment of the prescribed fee,
consolidate or subdivide such stock or securities and issue to the applicant one or more new stock certificates or securities as may be required.
Where application is made to the Central Bank under this Act for the issue of a duplicate stock certificate or a duplicate security or for the exchange, renewal, consolidation or subdivision of any stock or securities, the Central Bank may require the applicant, as a condition precedent to the grant of the application, to execute a bond with or without sureties undertaking to indemnify the Government against the claims of all persons claiming under the original stock certificate or security or under the stock or securities so exchanged, renewed, consolidated or subdivided, as the case may be.
On payment by or on behalf of the Government to the holder of a bearer bond of the amount expressed therein on or after the date when it becomes due or on the renewal of a bearer bond under section 30 of this Act, or on the exchange of a bearer bond under section 32 of this Act, or on the consolidation or subdivision of a bearer bond under section 33 of this Act, the Government shall be discharged in the same way and to the same
extent as if such bearer bond were payable to bearer.
Save as otherwise provided in this Act the liability of the Government shall-
(a) in respect of any registered stock or security redeemed on or after the date on which payment of the principal amount becomes due, be discharged after the lapse of six years from that date;
(b) in respect of any security in place of which a duplicate is issued under section 30 of this Act, be discharged after the lapse of six years from the date of the issue of such duplicate or from the date of the last payment of interest on such security, whichever date is the later;
(c) in respect of a security for which a renewed security is issued under section 30 of this Act, or in respect of stock or securities in place of which new stock or securities are issued upon an exchange under section 32 of this Act, or upon a consolidation or subdivision under section 33 of this Act, be discharged after the lapse of six years from the date of the issue of the renewed security or of the new stock or securities, as the case may be.
(1) If within six months of the death of a person who was entitled to registered stock, the nominal or face value of which does not in the aggregate exceed five hundred naira, probate of the will or letters of administration of the estate of such person is not produced to the director of domestic operations of the Central Bank, he may, after such inquiry as he may deem necessary, determine who is the person entitled to such stock or to administer the estate of the deceased and may-
(a) where any such stock relates to a loan due for repayment, authorise the registration of the name of such person in substitution for the name of the deceased in the register of stock and the payment to such person of the amount due in respect of that stock;
(b) where any such stock relates to a loan not due for repayment, authorise the registration of the name of such person in substitution for the name of the deceased.
(2) Upon the payment or renewal of any promissory note in accordance with subsection (1) of this section, the Government shall be discharged from all liability in respect of the note so paid or renewed; and any substitution of names made under that subsection shall, for the purposes of any claim against the Government, be deemed to have effected a valid transfer of the stock in respect of which it was made.
(3) Any creditor or claimant against the estate of the deceased may recover his debt or claim out of money paid to any person under subsection (1) of this section and remaining in his hands unadministered in the same manner and to the same extent as if the said person had obtained letters of administration of the estate of the deceased, and nothing in this section shall affect any claim of an executor or administrator or other representative of the deceased against such person other than a claim to recover amounts lawfully paid by him in due course of administration of the estate of the deceased.
(4) The director of domestic operations of the Central Bank may, for the purposes of an inquiry under this section, exercise all or any of the powers of a commissioner under the Commissions of Inquiry Act as if he were a commissioner appointed thereunder by a
commission issued by the Minister.
PART IX
Miscellaneous
The signature of the director of domestic operations of the Central Bank may be printed, stamped, engraved, or impressed by any mechanical process on any stock certificate, or bearer bond and a signature so printed, stamped, engraved or impressed shall be as valid as if it had been inscribed in the proper handwriting of the chief accountant of the Central Bank.
Save as otherwise provided in or under this Act, no notice of any trust in respect of any registered stock or securities shall be receivable by the Central Bank or by the Government.
All documents or instruments made or used under the provisions of this Act shall be in such form as may be prescribed and shall be free from stamp duty, anything in any other Act to the contrary notwithstanding.
(1) No person shall be entitled to inspect, or to receive information derived from, any registered stock or security in the possession of the Government or any register, book or other document kept or maintained by or on behalf of the Government in relation to registered stock or securities, save on payment of such fee and save in such circumstances and on such terms and conditions as may be prescribed.
(2) Nothing in this section shall apply to the Auditor-General for the Federation or to the Deputy Commissioner of Income Tax.
(1) The Minister may make regulations for the purpose of giving effect to the provisions of this Act.
(2) In particular and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters-
(a) the manner in which payment of interest in respect of stock or securities is to be made and acknowledged;
(b) the circumstances in which promissory notes must be renewed before further payment of interest thereon may be claimed;
(c) the issue of duplicate stock certificate and duplicate securities;
(d) the renewal of stock certificates and securities;
(e) the manner of payment of interest to joint holders of stock or securities;
(f) the circumstances in which alterations may be made in the register;
(g) the payment of principal or interest and transfer of stock and securities in the case of persons under a legal disability;
(h) the disposal of unclaimed interest;
(i) the conditions subject to which stock or securities may be exchanged, consolidated or subdivided;
(j) to enable holders of registered stock to be described in the register as trustees and either as trustees of any particular trust or as trustees without qualification and for the recognition of powers of attorney granted by holders of stock so described;
(k) the fees to be paid in respect of anything to be issued or done under the provisions of this Act;
(l) all matters required by this Act to be prescribed and all matters incidental to or connected with the matters hereinbefore enumerated.
(3) Nothing in any regulation made hereunder shall, as between any trustees or as between any trustees and beneficiaries under a trust, be deemed to authorise the trustees to act otherwise than in accordance with the rules of law applying to the trust and the terms
of the instrument constituting the trust; and neither the Government nor the Central Bank nor any person holding or acquiring any interest in any registered stock shall by reason
only of any entry in the register of stock or of anything in any document or instrument relating to registered stock, be affected with notice of any trust of the fiduciary character of any stock holder or of any fiduciary obligation attaching to the holding of any registered stock.
Nothing contained in this Act shall affect the provisions of the General Loan and Stock Act.
LOCAL LOANS (REGISTERED STOCK AND SECURITIES) ACT
SUBSIDIARY LEGISLATION
List of Subsidiary Legislation
1. Local Loans (Registered Stock) Regulations, 2004.
LOCAL LOANS (REGISTERED STOCK) REGULATIONS
ARRANGEMENT OF REGULATIONS
REGULATION
REGULATION
LOCAL LOANS (REGISTERED STOCK) REGULATIONS
[S.I. 2 of 2004.]
[21st August, 2003] [Commencement.]
These Regulations may be cited as the Local Loans (Registered Stock) Regulations, 2004.
Applications for allotment of the bond shall be made of forms to be issued by the Central Hank for the purpose.
(1) Allotment of bond shall be made in the manner agreed between the Central Bank and the Minister.
(2) Letters of allotment shall be issued to all persons to whom the bond is allotted.
(1) A register of the holders of bond shall be kept by the Central Bank.
(2) In the event of bond being registered incorrectly owing to any mistake in the request for registration or transfer, the account shall be amended upon the receipt of the letter or declaration, as the case may require, stating how the error arose; in the event of alteration to any name or names in the account which has been necessitated by reason of a transfer, re-execution of the transfer shall be made by the transferor or by his attorney.
(3) On the marriage of a female bondholder, her name and description shall be altered in the register with respect to bond standing either in her name solely, or jointly with any other persons, on such bondholder producing to the Central Bank, her marriage certificate, and notifying her change of address, if any, and giving full particulars of the accounts in which it is desired to have the alterations made and specimens of her present and former signatures shall be furnished.
(1) Certificates stating the name of the bond holder or bond holders registered as such in the books of the Central Bank shall be issued in exchange for allotment letters at such times as shall be notified in the allotment letters.
(2) The loss or destruction of any bond certificate shall be notified in writing to the Central bank as soon as practicable by the person entitled to the possession thereof.
(3) If the Central Bank is satisfied that any bond certificate has been lost or destroyed, or is on the opinion that any bond certificate has been issued in error or has been tampered with or is in such a condition as to render its renewal desirable, the Central Bank may-
(a) in the case of loss or destruction, issue, after the expiration of two calendar months after the date of receipt of the notification in writing of the loss or destruction, a duplicate certificate; and
(b) in any other case, issue a renewal of the bond certificate to any person who satisfies the Central Bank that he is entitled to the possession thereof.
(1) Subject to the provisions of these Regulations, any application with respect to the issue of bond in the names of two or more persons as joint bondholders shall be made by all such persons.
(2) The joint bondholders of any bond may authorise any person including one of themselves to act as their agent in respect of such bond and the provisions of these Regulations relating to their authorisation of agents shall apply accordingly.
(3) Where bond is registered in the name of three or more bondholders and an application in that behalf is made in respect of such bond in accordance with the provisions of these Regulations, all things required to be done for the purpose of dealing with such bond may, subject to the provisions of these Regulations be done and given by a majority of the persons who are the bond holders at the date when the application is made or in the case of the death of any of such persons by a majority of the survivors of them.
(4) An application for the purpose of these Regulations shall be made in writing to the Central Bank.
(5) A person, who is registered as one of the bondholders of any bond with respect to which an application has been made under these Regulations may give notice in writing to the Central Bank that the application is revoked and on notice being given, the provisions of these Regulations shall as from the receipt of the notice by the Central Bank, cease to apply to such bond.
(6) The provisions of this Regulation shall not apply to the transfer of bond.
(1) The interest due on any registered bond shall be paid on an interest warrant to the registered bondholder or to any person or body of persons to whom the bondholder has by request duly made to the Central Bank.
(2) No warrant shall be paid until the receipt thereon for the amount thereby payable has been duly signed and such receipt shall be a full discharge to the Government and to the Central Bank for the payment of the sum named in the warrant.
(3) The posting of a letter containing a warrant sent by the Central Bank in pursuance of these Regulations addressed to any person at the last address furnished by that person to the Central Bank shall, as regards the liability of the Government and of the Central Bank, be equivalent to the delivery of the warrant to the person to whom the letter was
addressed.
(4) Where in pursuance of these Regulations or in accordance with any authority given thereunder, any payment is to be made by the Central Bank to a firm or a body of persons whether corporate or unincorporate, a receipt for the payment given by any person purporting to be an agent or officer of that firm or body and to be authorised to receive the payment shall be a full discharge to the Government and the Central Bank for the amount paid.
(5) Where bond is registered in the names of two or more persons as joint bondholders, the Central Bank may unless other arrangements with respect to the payment of interest have been made in accordance with these Regulations, pay any interest thereon to the bondholder whose name appears first in the register.
(6) A receipt for the payment of interest on any bond which is given by anyone of two or more joint bondholders of such bond shall, unless notice in writing to the contrary has been received by the Central Bank from any other joint bondholder of such bond, be a full discharge to the Central Bank and the Government for the payment of that interest.
(1) Bowl shall be transfer for a minimum often thousand naira (N10,000) and thereafter in multiples of one thousand naira by an instrument of transfer in the common form accompanied by the relative bond certificate.
(2) No transfer, consolidation or sub-division of bond shall be made except for a minimum of ten thousand naira (N10,000) and thereafter in multiples of one thousand naira of bond.
(1) Subject to the provisions of these Regulations, any bondholder may give an authority in writing authorising any person to act as his agent with respect to bond held by him or with respect to any interest arising therefrom and such authority may-
(a) relate to the whole bond or to a minimum of one thousand naira of bond which is held or may at any time be held by the person or persons giving the authority;
(b) authorise the person to whom the authority is given to deal with the bond or interest to which it relates either generally at his discretion or subject to any directions contained in the authority.
(2) An authority given under this regulation shall be of no effect unless and until it is delivered to the Central Bank.
(3) An authority given under this regulation may be revoked at any time by the person by whom it was given and shall be determined by the death, bankruptcy or legal disability of that person:
Provided that payment duly nude by the Central Bank under these Regulations in compliance with an authority given under regulation shall, notwithstanding the revocation or determination of such authority be deemed for all purposes to be valid unless notice in writing of the revocation had been received by or the death, bankruptcy or disability had come to the knowledge of the Central Bank at the time when payment was made.
(4) An authority given under this regulation shall, subject to the terms thereof, until revoked or determined-
(a) remain in force notwithstanding any increase or decrease in the nominal value of the bond to which it relates;
(b) entitle the person to whom it is given to make any application and sign any document mentioned in these Regulations and to receive any payment in pursuance thereof.
(5) The provisions of this regulation shall not apply to the transfer of bond.
(1) If the bondholder of any bond becomes of unsound mind or otherwise subject to legal disability, anything which under these Regulations may be done by or in relation to such bondholder may be done by or in relation to the person having power in law to ad- minister the property of such bondholder.
(2) Where the Central Bank is satisfied that any person, being one of the two or more joint bondholders, has become of unsound mind or otherwise subject to legal disability, the Central Bank may upon receiving an application in writing in that behalf made by the remaining joint bondholder or bondholders, treat him or them as being entitled to receive any interest accruing thereon.
(1) The death of a bondholder shall be proved by production of probate of the will or letters of administration and where necessary, a declaration as to the identity of the deceased shall be made by some disinterested person.
(2) On completion of the proof of death of a bondholder in a joint account, the bond shall be held at the disposal of the survivor or survivors.
(3) On the death of the last survivor in a joint account, the bond and interest therein shall be held at the disposal of the executors or administrator of such last survivor.
The Government, the Central Bank and any person acting under their authority, shall not be liable in respect of any payment duly made, or act duly done in accordance with these Regulations and any such payment shall, subject to the provisions of regulation 13 of these Regulations, be deemed to have been a valid payment and the receipt of the per-
son to whom the money was paid shall be a full discharge to the Government and to the Central Bank for the amount of the payment.
No provision of these Regulations for the protection of the Government and of the Central Bank in respect of any act done or any money paid shall operate to prevent the recovery by any person or his representative of any bond or money lawfully due to him from the person to whom such bond was transferred or such money was paid by or under the direction of the Central Bank or from the representative of that person.
Local Loans (Registered Stock) Regulations are revoked:
Provided that nothing in these Regulations shall affect the application of the Local Loans (Registered Stock) Regulations to any loans raised under the Act before the coming into operation of these Regulations.
LOCAL LOANS (FIRST FEDERAL GOVERNMENT OF NIGERIA
BONDS 2003) (AMENDMENT) DIRECTIONS, 2004
ARRANGEMENT OF SECTIONS
SECTION
LOCAL LOANS (FIRST FEDERAL GOVERNMENT OF NIGERIABONDS 2003) (AMENDMENT) DIRECTIONS, 2004
[S.l. 3 of2004.]
[21st August, 2003] [Commencement.]
Citation
These Directions may be cited as the Local Loans (First Federal Government of Nigeria Bonds 2003) (Amendment) Directions, 2004.
(1) The sum of money to be raised by the loan shall be an aggregate
N150,000,000,000 in the form of registered stocks styled as “FGN Bonds”, to be issued in four tranches, as follows-
N56,000,000,000 …………………… 17 ¾ % 1st FGN Bond 2006
N14,000,000,000 …………………… 18 ¼ % 1st FGN Bond 2008
N40,000,000,000 ……………………. 1st FGN Floating Rate Bond 2010
N40,000,000,000 ……………………. 1st FGN Floating Rate Bond 2013
(2) The Bond shall be issued at par, payable on application, and in denominations of N1,000.
(3) The Bonds so raised shall be transferable in minimum amounts of N10,000 of Bonds and thereafter in multiples of N1,000.
(1) Interest at 17¾ % per annum shall be payable on the 1st FGN Bonds 2006, and 18 ¼% per annum shall be payable on the 1st FGN Bonds 2008. The first interest payment shall be on 31st March 2004, accruing from the date following the deadline for the receipt
of returns from the receiving agents and thereafter interest shall be payable half-yearly in arrears on 30th September and 31 st March each year until maturity.
(2) Interest on the 1st Floating Rate Bonds 2010 and the 1st Floating Rate Bonds 2013 shall respectively be at 3.0% per annum and 3.75% per annum above the Treasury Act rate ruling froth time to time. The rate ruling shall be the highest successful discount rate established at a CBN conducted auction or the discount rate for the time
being established by the CBN, payable on 91 day Treasury Act. The rate applicable from time to time shall be the rate ruling at the beginning of each interest payment period, the first of such interest payment period commencing from the date following the deadline
for the receipt of returns from the receiving agents and ending on 31st March 2004, which shall be the first interest payment date. Thereafter, interest shall be payable half yearly in arrears on 30th September and 31 st March each year until maturity.
The half-yearly contributions out of the general revenue and assets of the Federation to the sinking hand established for the purpose of redeeming the Bonds, the first of such payment to be made on 30th September 2004 at the following rates of the principal sums as set out hereunder opposite each of the Bonds-
N56,000,000,000 ………………………. 17¾% 1st FGN Bond 2006
N14,000,000,000 ………………………. 18¼% 1st FGN Bond 2008
N40,000,000,000 ………………………. 1st FGN Floating Rate Bond 2010
N40,000,000,000 ………………………. 1st FGN Floating Rate Bond 2013
The Federal Government of Nigeria shall redeem the Bonds at par on the respective maturity dates, to wit-
N56,000,000,000 | 17¾% 1st FGN Bond 2006 | 30 September 2006 |
N14,000,000,000 | 18¼% 1st FGN Bond 2008 | 30 September 2008 |
N40,000,000,000 | 1st FGN Floating Rate Bond 2010 | 30 September 2010 |
N40,000,000,000 | 1st FGN Floating Rate Bond 2013 | 30 September 2013 |
The Federal Government of Nigeria shall be entitled at any time to redeem the whole or any part of the Bonds on giving to the Bondholders not less than three months notice (expiring on a day fixed for the payment of interest there on) of its intention to do so and at the expiration of such notice, the Federal Government of Nigeria shall be bound to
redeem the Bond or Bonds in respect of which such notice has been given and to pay interest that shall have accrued thereon at a premium of 0.25% for each year or part of a year by which the date of redemption precedes the maturity date of the Bond or Bonds:
Provided that any Bond or Bonds to be so redeemed shall be redeemed as between Bondholders on a pro rata basis.
Interest payable on this Bond shall be exempt from any tax and no tax shall be deducted at source.