U.o.o. Nig. Plc V. Okafor & Ors (2020)

LAWGLOBAL HUB Lead Judgment Report

ADAMU AMINA AUGIE, J.S.C. 

The Appellant Company was founded by one late Nze Uche Okafor, who had seven wives, and fifty-five Children. Before his death in January 2007, the late Uche Okafor, had by a letter dated 27/1/2004, tendered his resignation as the Chairman/Managing Director/Chief Executive of the Company, to the Board of Directors, and appointed his son, “Edozie Uche Okafor”, as his nominee for the said positions.

At its General Meeting held on 6/8/2004, it was resolved as follows:

1. That Chief Uche Okafor, Chairman/Managing Director/Chief Executive of the Company be and is hereby retired as the Chairman/Managing Director/Chief Executive of the Company, on grounds of old age.
2. That in his place, Mr. Edozie Uche Okafor, be and is hereby appointed the Chairman/Managing Director/Chief Executive of the Company.
3. That steps should be taken to reflect this position at the Corporate Affair s Commission, Abuja.

Paragraph 80(d) of its Articles of Association dated 4/8/2004 reads:

​Mr. Edozie Uche Okafor, having been nominated by Chief Uche Okafor to succeed him as Chairman, Managing Director/Chief Executive (MD/CEO) of the Company is hereby made a life Director of the Company and the Chairman, Managing Director and Chief Executive of the Company for life. The said Edozie Uche Okafor is hereby made the Chairman of the Board of Directors for life. Any contrary provisions to this effect on this Articles of Association is to be interpreted subject to the provision of this Clause.

In February 2005, some of the Directors and Shareholders indicated their desire to disinvest from the Company, and at an Extra Ordinary General Meeting of the Company held on 9/2/2005, a 10-man Asset Valuation Committee was set up to inter alia value its assets/shares. The said Committee worked with some professional companies and came up with a unit price of N1.50 Naira per share that was rejected, and after negotiations, the Parties agreed to N2.65 Naira per share.

At the Annual General Meeting (AGM) of the Company held at Aba on 9/3/2007, the SPECIAL BUSINESS on the AGM’s Agenda was:

To receive and adopt N2.65k as the value of each share of U.O.O. Nigeria Plc., as agreed by the Members of the Revaluation Committee.

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But, as the Chairman, Nze Edozie Okafor, was reading his Address, and mentioned the said unit price of N2.65k, there was commotion, and the Meeting became very rowdy. The said Nze Edozie Okafor left the venue of the Meeting when the first Respondent moved a Motion for his removal as Chairman of the Company. He was later informed that the Directors and Shareholders, who stayed behind, voted to remove him as the Chairman and that the first Respondent, who moved the said Motion, was appointed the new Chairman.

On 21/3/2007, Nze Edozie Okafor took out an action against the Respondents at the Federal High Court, Lagos in the name of the Appellant Company. On 13/7/2007, he summoned a Meeting of the Board of Directors to ratify his action, and the Board resolved that:

The action taken by the Chairman to go to Court to challenge the alleged removal of the Chairman was in order and thereby gave its authority to the effect that the matter should be diligently pursued.

The Statement of Claim was later amended. The Appellant Company claimed the following reliefs in the Amended Statement of claim –

a. A Declaration that the purported removal of the Chairman of the Board of Directors, Nze Edozie Uche Okafor, from office at the Annual General Meeting of 9/3/2007 is unlawful, illegal, null and void, the proceedings if any, not having been conducted in compliance with the Articles of Association of the Company and the Companies and Allied Matters Act (CAMA).