Chief Theodore Ezeobi, S.A.N. V. Daily Times Of Nigeria PLC (2013)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

JOSEPH SHAGBAOR IKYEGH, J.C.A. (Delivering the Leading Judgment)

The appeal arose from a decision of the Federal High Court of Justice sitting in Lagos (the court below) refusing the motion brought by the appellant to direct the Official Receiver/Provisional Liquidator to protect the assets of the respondent pending the determination of the winding up petition filed by the appellant to liquidate the respondent.

Sketchily stated, the appellant, a Senior Advocate of Nigeria (SAN), was at all material times an external solicitor of the respondent. In the course of the retainership, the respondent who was experiencing chronic financial instability accumulated debts of N18 million from the legal services rendered her by the appellant. Concerted effort was made by the appellant to recover the debt. It yielded no positive result, as the respondent’s liquidity had dried up.

Sensing the respondent was cash strapped and could not discharge the admitted indebtedness, the appellant, as a creditor, filed a petition for the winding up of the respondent at the court below. By the calculation of the appellant, the liquidation of the respondent would afford him the opportunity to recover the N18 million admitted indebtedness from the sale or disposal of the assets of the respondents.

Hence the winding up petition at the instance of the appellant against the respondent at the court below and the move by the appellant to secure the assets of the respondent from dissipation by requesting the court below on motion on notice to direct the Official Receiver/Provisional Liquidator of the respondent, one Mrs. Mba, to gather together and protect the assets of the respondent pending the outcome of the winding up petition.

The court below refused the motion. It held that it would not appoint an Official Receiver on the grounds that a subsisting order of another Federal High Court (Nyako, J.) had appointed Official Receiver for the respondent and that the appellant should have sued for his solicitor’s fees in an ordinary action instead of bringing the winding up petition at the court below, upon which it struck out the winding up petition.

Not unnaturally, the appellant was dissatisfied with the decision of the court below. He challenged it in a notice of appeal containing five grounds of appeal on 19.10.07. In a brief of argument filed on 17.02.10, but deemed properly filed on 26.01.13, the appellant derived two issues for determination as follows-

“(i) Whether having regard to the facts and circumstances so far of this winding up petition, some of the conclusions properly reached by the trial judge in the Ruling under appeal including that,

“It is not in doubt that the petitioner is a creditor,” the learned trial Judge was right in going outside the prayers and reliefs in the motion paper as canvassed before the court by the parties, incorporating strange and irrelevant elements and purporting to determine the same and ending in, suo motu, striking out the entire winding up petition. (Grounds 1, 2, 3(b) & 5)

(ii) Whether, it was at all open to the trial Court to dictate to the petitioner/applicant which of various competing remedies the petitioner should pursue in a court of law.

(Grounds 3 (a) & 4).”

As a prelude to arguments on the issues (supra), the appellant’s brief made some scathing comments on the alleged treacherous manner some of his learned colleagues caused him to lose the retainership of the respondent and the grasping way the new owners of the respondent, Folio communication, Limited, were frittering away the assets of the respondent. The appellant’s swipe was in material particular on a chief Anthony Idigbe, SAN, who at a certain point in time was appointed interim or provisional Receiver/Manager of the respondent by Folio communications Limited. Some uncomplimentary statements were made concerning the person of Chief Anthony Idigbe, learned SAN, by the appellant in respect of his management of the affairs of the respondent as her erstwhile interim Receiver/Manager.

It was submitted that the court below digressed from the prayers sought in the motion paper to hold that the respondent was in receivership under the N.D.I.C. by an order of another Federal High court, (Nyako, J.), so the application by the appellant for the court below to appoint its Deputy chief Registrar official receiver of the respondent was not grantable, whereas no such prayer was asked for in the motion moved by the appellant and replied to by the respondent, and whereas pages 55 – 57 of the record of appeal (the record) mentioned the appointment of counsel for the respondent, not the appointment of the receiver of the respondent by the said Federal High Court. Consequently, the court below veered off the mark when it held that Nyako, J., had settled the issue of the appointment of an Official Receiver for the respondent which was not one of the prayers in the motion paper, therefore the court below erred by ignoring the prayers in the motion paper to issue orders not asked for and unrelated to the application before it vide Ekpenyong and Ors. v. Nyong and Ors. (1975) 2 SC 71, Commissioner for Works, Benue State and Anor. v. Devcon Development Consultants Ltd. and Anor. (1988) 3 NWLR (pt. 83) 407, Fadlallah v. Arewa iles Ltd (1997) 8 NWLR (pt. 518) 546 at 559.

It was argued on the second issue that it was not the function of the court below to advise the appellant on the remedy open to him when the court below found as a fact that the appellant was the respondent’s creditor, therefore for the court below to turn round to hold that the appellant was wrong to institute winding up proceedings against the respondent was perverse having regard to the appellant’s undoubted right to maintain the action vide International Merchant Bank (Nigeria) Ltd. v. Speegalfs Company (Nigeria) Ltd. (1997) 3 NWLR (pt. 494) 423, Pure Way Corporation Nigeria Ltd. (1978) 2 LRN 70 at 72 read with section 410 (1) (6) of the companies and Allied Matters Act (CAMA).