Adebisi Jacob Olawepo V. Securities And Exchange Commission (2011)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

REGINA OBIAGELI NWODO, J.C.A. (Delivering the Leading Judgment)

The Security Exchange Commission on receipt of twenty two (22) allegations of fraud against Asset Plus Securities Limited and 12 others invited all the directors of the company and some principal officers of the company to appear before the Administrative Proceedings Committee (APC) of the Commission.

The Appellant was the seventh Respondent before the committee. He appeared before the committee and was represented by a Counsel. In the affidavit of the Appellant, he stated that he was appointed a director in Asset Plus Security Ltd. on the 19th of April, 1999 by Board Resolution and same was filed at the Corporate Affairs Commission. The Appellant averred that the Asset Plus Securities Ltd sold his shares in Wise Investment without his knowledge or consent and the shares of others friends he recommended to the company without their consent. Appellant resigned as a director in Asset Plus Securities Ltd on the 9th of May, 2001. At the hearing of the 22 complaints before the Administrative Proceedings Committee (hereinafter referred to as APC) affidavit evidence was admitted and after deliberation, findings were made and decision taken. The Appellant contention is that when the APC pronounced their decision orally on the 11th of August he was not indicted.

However, sometimes in 2007, the Appellant was informed by the Registrars of certain quoted companies where he has shares that there is a ban placed on him as a result of his indictment by the same body Administrative Proceedings Committee in five (5) of the twenty two (22) complaints against Asset Plus Securities Ltd. contrary to the pronouncement made by the Administrative Proceedings Committee on 11th of August, 2005.

The Appellant then applied for a certified true copy of the Proceedings and Decisions of the Administrative Proceedings Committee of Security Exchange Commission in respect of the five (5) complaints. The Appellant discovered on receipt of the certified copy of the proceedings that they did not indict him in any of the named five cases. The record of proceedings obtained from the commission that is the Respondent was filed with the Notice of Appeal in the Investment and Securities Tribunal. The Respondent before the hearing of the appeal swore to an affidavit deposing to the facts of the indictment of the Appellant in the proceedings before the Administrative Proceedings Committee of the Security Exchange Commission and annexed copies of proceedings in which the Appellant was indicted before the same Administrative Proceedings Committee. Two Records of Proceedings were presented in respect of the Notice of Appeal one indicting the Appellant and the other not indicting him. Both were certified and issued by the same Respondent in respect of the Appeal before the tribunal. The Respondent in their 21 paragraph affidavit averred to reasons for the discrepancy in the two certified true copies of the Record of Proceedings of the Administrative Proceedings Committee stating the correct record is the later one where Appellant was indicted.

The Appellant aggrieved with the decision of the Administrative Proceedings Committee as reflected in the second record of proceedings filed a Notice of Appeal on 21/09/07 against the decision to the Investment and Securities Tribunal. The Investments and Securities Tribunal heard the appeal and delivered its Judgment on 28 May, 2008 wherein they held:

7. “That Appellant is jointly and severally liable in accordance with Section 305(1) of ISA 2007 for the five cases of his indictment namely Suits Nos APC/1/2005, APC/2/2005, APC/7/2005, APC/8/2005 and APC/2 2/2005.

2a) The caution placed on the Appellants stocks is consequentially retained until the fall discharge of the liability arising from Suit No’s. APC/1/2005, APC/2/2005, APC/7/2005, APC/8/2005, and APC/22/2005

2b) The SEC is hereby ordered to determine and apportion the appropriate monetary liability of the appellant arising from I above within 6 weeks from the date of this judgment and inform the Appellant and IST accordingly.

3. The indefinite suspension placed on the Appellant from participating in the Nigerian capital market activities and or holding directorship position in Nigerian public companies is hereby lifted from the date of this judgment.”

The Appellant aggrieved by this decision of the Investment and Securities Tribunal filed a Notice of Appeal on 23/06/08 containing three grounds of appeal.

The Respondent not satisfied with some part of the Judgment also filed a Notice of Cross Appeal containing two grounds of appeal on 11/07/08 against the same decision of the Investment and Securities Tribunal delivered on 28 May, 2008.

In compliance to the Rules of this court, the learned counsels filed and exchanged briefs of argument. At the hearing of the Appeal on 11/2/2010 the learned counsel for the Appellant Mr. S.A Oke adopted the Appellants brief of argument filed on the 04/02/09 but deemed properly filed and served on 19/10/2009 with leave of court. He urged the Court to allow the appeal.

The learned Counsel for the Respondent/Cross Appellant Mr. Ademola Adeniji adopted the Respondent/Cross Appellant Brief of Argument settled by him and filed on 23/09/09 and the Cross Appellant reply Brief filed on 25/2/2010. Mr. Oke also adopted the cross Respondent’s Brief of Argument deemed properly filed on 8/03/10. Mr. Adeniji urged the court to dismiss the appeal.

The learned Counsel for the Appellant Mr. Oke in the Appellants brief distilled two issues for determination which reads as follows:-

1. “Whether the Investment Tribunal was not in error in relying on the affidavit of the respondent to resolve the conflict or differences in the two judgments written by SEC.
2. Whether the Appeal Tribunal was not in error when they found the appellant jointly and severally liable (with others who participated in the fraud and accepted liabilities accordingly) in accordance with Section 305 (1) ISA 2007 having found earlier that there was no direct established evidence that the appellant connived, consented to or in any way participated in the fraud.”

The Respondent adopted the two issues formulated in the Appellants Brief.