Merchants Bank Ltd V. Federal Minister Of Financemerchants Bank Ltd V. Federal Minister Of Finance (1961)

TAYLOR, F.J

This is an appeal from the Judgment of the High Court of Lagos dismissing the Plaintiffs/Appellants’ claims for:–

(a)A declaration that the Order published as Legal Notice No. 152 of 1960 and dated 23rd September, 1960 is void and of no effect.

(b)An injunction restraining the defendants, their servants and/or agents from giving effect to the said Order and also from winding up the banking business of the plaintiffs. There were no pleadings ordered by the lower Court nor was evidence adduced. The trial Judge stated the issue before him in the following words:-

No oral evidence was offered in the case and the single question submit-ted for a decision is whether an order made by the Minister of Finance of the Federal Government of Nigeria impinged on the plaintiffs’ constitutional rights.

It would appear from the arguments of Counsel on record that the following facts are common ground:

(a)That the appellant Bank was duly licensed to carry on banking business, and

(b)That on the 23rd September, 1960, the Federal Minister of Finance made an order, which is the subject-matter of action in the lower Court, revoking the licence granted to the appellant Bank and ordering its winding-up.

At the hearing of this appeal, Chief Williams Q.C., urged that:–

(a)The trial Judge erred in holding that the Banking Ordinance does not confer a right upon the appellant Bank, for, he contended, the question as to whether a licence confers a right is dependent on the relevant statutory provisions and not on the general conception of what is a licence.

(b)That if he is correct in the above contention, then by virtue of Clause 5 of the Sixth Schedule of the Nigeria (Constitution) Order in Council, 1954, (which will be hereafter referred to as the 1954 Constitution) the appellant Bank is entitled to have that right determined or revoked only “by a Court or other tribunal established by law” in accordance with the above Constitution.

Mr. Adebiyi, who appeared for the Federal Minister of Finance, the second defendant in the High Court not having been served, contended that the appellant Bank did not possess any “civil rights” within the meaning of the 1954 Constitution, then in force, and that all they possessed was the privilege to carry on banking business within the meaning of the Banking Ordinance and no more. Further, that such a privilege was determinable in the manner provided by that Ordinance.

The grant of a licence to do banking business is governed by s.3 of the Banking Ordinance which provides inter alia that:

3(1).    No banking business shall be transacted in Nigeria except by a company which is in possession of a valid licence, which shall be granted by the Minister after consultation with the Central Bank, authorizing it to carry on banking business in Nigeria: Provided that a valid licence granted under the provisions of the Banking Ordinance, 1952, shall be deemed to be a licence granted under the provisions of this section. The revocation of licences is governed by s.3(5)(b) which provides that:–

The Minister may by Order revoke any licence –