Leaders & Company Limited V. Christlieb Plc & Ors (2016)

LawGlobal-Hub Lead Judgment Report

SIDI DAUDA BAGE, J.C.A.

This is an appeal against the judgment of the Honourable Justice J.E. Shakarho of the Federal High Court sitting at Lagos in suit No. FHC.L.CS.540/2004, delivered on the 13th of December, 2010. The Plaintiff (now 1st Respondent) at paragraph 34 of the amended statement of claim, claimed against the Defendants jointly and severally as follows:
i. A declaration that the 1st and 2nd Defendants have no right, power, mandates or jurisdiction to act for the Plaintiff or manage its affairs as Managing Director and Company Secretary respectively, particularly to the extent of dissipating, selling off, transferring or assigning to the 3rd Defendant the assets and, or immovable property of the Plaintiff and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos.
ii. A declaration that the purported sale, transfer, disposition, alienation or assignment of the Plaintiffs landed property and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos by the 1st and 2nd Defendants the 3rd Defendant is in violation of the

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Memorandum and Articles of Association of the Plaintiff, the Companies and Allied Matters Act, ultra vires the powers and jurisdiction of the 1st and 2nd Defendants and therefore, null and void and of no effect whatsoever.
iii. A declaration that the sale, transfer or assignment of the Plaintiffs landed property appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos by the 1st and 2nd Defendants while purportedly managing the affairs of the Plaintiff to the 3rd Defendant without the authority of both the Board of Directors of Plaintiff and its annual General meeting is ultra vires the powers and jurisdiction of the 1st and 2nd Defendants and therefore null and void and of no effect whatsoever.
iv. A declaration that the purported sale or assignment of the Plaintiffs landed property and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa Lagos by the 1st and 2nd Defendants while purported managing the affairs of the Plaintiff to the 3rd Defendant a sum of N18,000,000.00 (Eighteen Million Naira Only) evidenced by a Deed of Assignment dated 6th June, 2002 registered with THE 7TH Defendant is vitiated

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by patent fra and therefore, illegal, null and void and of no effect whatsoever.
v. A declaration that the 3rd Defendant having fraudulent acquired the Landed property of the Plaintiff situate, lying and being at No. 35 Creek Road, Apapa, cannot legally and legitimately mortgage same to any or either of the …… AND 5TH Defendants to secure banking facilities and that any purported mortgage of the said property by the Defendant to either or both of the 4th and 5th Defendants illegal, null and void and of no effect Whatsoever.
vi. A declaration that the purported sale and/or assignment of the Plaintiffs property and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa Lagos by the 1st and 2nd Defendants while purported managing the affairs of the Plaintiff to the 3rd Defendant for a paltry sum of N18,000,000.00 (Eighteen Million Naira) ridiculous, questionable, fraudulent, unconscionable immoral sordid and in utmost bad faith.
vii. An order setting aside the purported sale, transfer assignment of the Plaintiffs landed property and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos by the

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1st and 2nd Defendant while purportedly managing the affairs of the Plaintiff to the 3rd Defendant.
viii. An order setting aside the Deed of Assignment dated 6th June, 2002 assigning the Plaintiffs property situate, lying and being at No 35 Creek Road, Apapa, Lagos to the 4th and 5th Defendants for a ridiculous and paltry sum of N18,000,000.00 (Eighteen Million Naira Only).
ix. An order setting aside the Deed of Legal Mortgage dated 10th May, 2004 between the 3rd and 4th Defendants (as Mortgage respectively) on the Plaintiffs property situate, lying and being at No. 35 Creek road, Apapa, Lagos.
x. An order setting aside any lease agreement between the 3rd Defendant on one part and each of the 4th and 5th Defendants on the other part on the Plaintiffs property situate, lying and being at No. 35 Creek Road, Apapa, Lagos.
xi. An order commanding each of the 4th and 5th Defendants to pay rents (commensurate with what obtains in the neighborhood) to the Plaintiff, commencing from the time they took occupation of parts of the plaintiffs property situate, lying and being at No. 35 Creek Road, Apapa, up to the time of judgment or until the Court

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directs otherwise.
xii. In the alternative to (xi) supra, an order directing the 3rd Defendant to return forthwith to the Plaintiff all rents collected from 4th and 5th Defendants on the plaintiff’s property situate, lying and being at No. 35 Creek Road, Apapa, Lagos.
xiii. An order of perpetual injunction restraining any or all of the 3rd, 4th and 5th Defendants either by themselves, agents, privies, servants or through any person or persons howsoever from entering or further entering, taking over or further taking over, trespassing or further trespassing on, exercising right of ownership or possession on the Plaintiffs property and the appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos.
xiv. An order of perpetual injunction restraining either or any of the 4th and 5th Defendant as mortgagees from selling, alienating or transferring or exercising any power of a mortgagee on the Plaintiffs property situate, lying and being at No. 35 Creek Road, Apapa, Lagos further to the Deed of Legal Mortgage dated 10th May, 2000 or any other Deed howsoever.
xv. An order of perpetual injunction restraining the 7th Defendant

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either by himself, agents, servant, privies or acting through any persons howsoever from permitting or allowing or registering any further transaction by any of the 3rd, 4th and 5th Defendants (either by way of mortgage, transfer, sale or assignment of the Plaintiff’s property and all appurtenances thereon situate, lying and being at No. 35 Creek Road, Apapa, Lagos.

The brief summary of this case is as follows:
In November 1999, the 1st Respondent sold its property, 35 Creek Road to the Appellant when the 2nd and 3rd Respondents were the 1st Respondent’s Managing director and Company Secretary respectively. The entire purchase price paid out by the Appellant to the 1st Respondent was NGN105,000,000 (One Hundred and Five Million Naira) as shown on Exhibits G1 and H4. Exhibit G1 is the purchase receipt dated 18th November, 1999, while Exhibit H4 is the covering letter forwarding it. See pages 6 & 8 of the record.

Prior to sale, the property was subject of legal mortgage created in favour of Union Bank Plc by the 1st Respondent. The 1st Respondent was in default and Union Bank wanted to sell the property. The 1st Respondent decided to sell to