Nndc V. Ugbagbe (2021)

LAWGLOBAL HUB Lead Judgment Report

HELEN MORONKEJI OGUNWUMIJU, J.S.C. 

This appeal is against the judgment of the Court of Appeal, Kaduna Division Coram: Ibrahim Shata Bdliya, Obietonbara Daniel-Kalio and Oludotun Adebola Adefope-Okojie (JJCA), delivered on 17th February, 2017 in Appeal No: CA/K/69/2014, setting aside the judgment of the Kaduna State High Court delivered on 21/10/2011 by Hon. Justice A. A. Othman.

The facts that led to this appeal are as follows:

​The Respondent started work at Ahmadu Bello University in 1972. In 1976, he transferred his service to the Benue Polytechnic. In 1980, he transferred back to the Ahmadu Bello University as the Bursar of the University. In 1988, the Respondent was appointed the Chief Executive Officer, Group Managing Director of the Appellant, the New Nigeria Development Company. The Respondent insisted at trial that he accepted the appointment with the Appellant on condition that his previous services at Ahmadu Bello University and the Benue Polytechnic would be transferred to the Appellant as continuation of service for the purpose of computing his pension and gratuity. The Respondent had served for 16 years at both Ahmadu Bello University and Benue Polytechnic. He served a further 4 years with the Appellant as its Chief Executive Officer, Group Managing Director and retired in 1992 after serving a total of twenty years in the public service.

However, when he retired, the Appellant refused to compute and pay his full entitlement to gratuity and pension as provided by the Pensions Act and other related circulars of the Federal Government. The Appellant claimed that it is a Limited Liability Company not bound by the Pensions Act or Federal Government circulars in that regard. After several attempts at reconciling their differences, the Respondent initiated an action at the High Court on 2/7/2003. The learned trial Court dismissed the Respondent’s claim and the Appellant’s Counter claim for arrears of rent. The trial Court held that the Respondent was bound by the conditions in his letter of appointment with the Appellant and no more.

​The Respondent appealed to the Court of Appeal which delivered judgment on 17/2/2017 and allowed the appeal on the ground that the Appellant is an “Approved Service” under the Pensions Act and consequently the Respondent being an employee who retired therefrom is entitled to have his pensions and gratuity computed in accordance with the Pensions Act and extant circulars in that regard. This appeal is against the judgment of the Court of Appeal.

From the grounds contained in the Appellant’s amended notice of appeal, the Appellant submitted three issues for determination in the brief settled by Samson Adikwe Egige Esq. In the Respondent’s brief settled by E. O. Isiramen Esq. similar issues were identified. Both briefs basically asked the questions stated below:

1. Whether in view of the clear provisions of Section 318 of the Constitution of the Federal Republic of Nigeria, 1999 (As amended), the lower Court was right when it categorized the Appellant as a Public Service of the Federation and extended the application of the provisions of the Pensions Act, CAP 346, LFN 1990 (now repealed) to the Appellant, for purposes of computation of the Respondent’s pension entitlements. (Distilled from Ground 1 of the Amended Notice of Appeal).
2. Whether the Appellant was bound by the provisions of the Pensions Act, Cap 346 LFN 1990 (now Repealed) and the various Federal Government circulars and regulations in respect of the computation and payment of the retirement benefits, notwithstanding that the Appellant is not part of the public service of the Federation. (Distilled from Grounds 3, 4, 5 and 7 of the Amended Notice of Appeal)
3. Whether the lower Court was right in excluding the Appellant’s Personnel Administrative Manual/conditions of service governing its employment contract with the Respondent, in the computation and payment of the Respondent’s retirement’s benefits. (Distilled from Grounds 2 and 6 of the Amended Notice of Appeal)

The Appellant also filed a reply brief.

After reading the record and the briefs of counsel, only one sole issue has been crystallized by me for the determination of this appeal.

SOLE ISSUE

Whether the Appellant was bound by the provisions of the Pensions Act and the various Federal Government Circulars and Regulations rather than solely on its Personnel Administrative Manual and Conditions of Service in the computation and payment of the retirement benefits of the Respondent, in the circumstances of this case.

Learned Appellant’s Counsel argued that there is no doubt that the provisions of the Pensions Act, CAP 346, LFN 1990 (repealed), are applicable to the Public Service of the Federation, and that it is clear from the provisions of Section 318 of the 1999 Constitution which is applicable to this case, and which the Court below relied on, that a company such as the Appellant in this Appeal can only be regarded as part of the Public Service of the Federation, if the Government of the Federation or its agency owns controlling shares or interest therein. Appellant’s counsel argued that the mere listing of the Appellant as an “Approved Service” in the Official Gazette No 26, Vol 61, Government Notice No 737 in respect of Organizations declared as Approved Services under the Pensions Act CAP 147, neither qualifies the Appellant’s staff to be in the public service of the Federation nor changes the status of the Appellant; in view of the clear provisions of the Constitution. Counsel argued that the undisputed facts on record are to the effect that the Appellant is a registered company whose shareholders are the nineteen (19) Northern States of Nigeria. It is undisputed that neither the Government of the Federation nor any of its agencies owns any share or interests in the Appellant. Therefore, it cannot be bound by the provisions of the Pensions Act. Counsel cited Abdullahi v. Mil. Admin, Kaduna State (2009) 15 NWLR (Pt. 1165) Pg. 417 Paras G-H. Counsel further argued that the Appellant is a limited liability company registered under the Companies and Allied Matters Act 1990 and the government of the nineteen (19) Northern States are its separate and individual shareholders and none of the nineteen (19) States have majority shares in the Company. It argued that its management and operation is regulated by its memorandum and articles of association and its Personnel Administration Manual which is reviewed by its Board of Directors. The Appellant argued that it is only liable to pay the Respondent’s pension to the extent of the period the respondent served with the Appellant while it is the responsibility of the other organizations with whom the Respondent served to contribute towards his pension for the period he served with them.

​The Appellant’s counsel submitted that the Court below in holding that the Appellant was part of the Public Service of the Federation by virtue of Exhibit F, relied on instruments that are by far inferior to the provisions of the 1999 Constitution to expand the scope of the Public Service of the Federation whose meaning is exhaustively covered by Section 318 of the 1999 Constitution. Counsel submitted that where the constitution has covered the field by providing for any subject matter, the provision of the Constitution on that subject matter is the overriding authoritative statement of the law on the subject matter. Counsel cited INEC v. MUSA (2003) 3 NWLR (Pt. 806) Pg. 72 at 110 Paras C.F.

Counsel further argued that the evidence on record established that the Respondent was employed into the services of the Appellant by appointment conveyed vide his letter of appointment which also notified the respondent of the Appellant’s conditions of service governing the said contract of employment. The relationship was of master and servant not subject to civil service rules. The finding of the Court below that the Appellant enjoyed the benefit of the Respondent’s transfer of service was therefore not supported by the evidence or the evidence on record. Counsel submitted that such a finding amounts to speculation and relying on extraneous matters between the parties and therefore perverse. Counsel cited Ikenta Best (Nig) Ltd. v. AG Rivers State (2008) 6 NWLR (Pt. 1084) Pg. 612 @ 653, Paras G-H; Ladoja v. Ajimobi (2016) LPELR- 40658 (SC) at 102 Paragraphs C-F; Madu v. Madu (2008) 6 NWLR (Pt.1083) Pg. 296 at 326 Para E. The Appellant’s counsel submitted that the Respondent’s employment was governed exclusively by Exhibit A, the letter of appointment and the conditions in the modified Personnel Administrative Manual, Exhibit T. Counsel cited Shuaibu v. UBN Plc (1995) 4 NWLR (Pt. 388) Pg. 173 @ 180 Paras D-E; Katto v. CBN (1999) 6 NWLR (Pt. 607) Pg. 390 at 405 Paras E-F; John Oforishe v. Nigerian Gas Company Ltd (2017) LPELR-42766 (SC) Pg. 10 Para C.