National Electric Power Authority V. B.O. Omotosho & Anor. (2010)
LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL
RAPHAEL CHIKWE AGBO, J.C.A.(Delivering the Leading Ruling)
The respondents in this appeal were plaintiffs at the Federal High Court in Suit No. FHC/L/CS/155/97 against the appellant. It was an infringement of copyright suit. The trial court awarded N500,000.00 damages to the 2nd respondent. Dissatisfied the appellant filed this appeal. By a motion on notice dated 12th March, 2009 and filed on 13th March, 2009 the appellant as applicant is praying this court for the following orders:
“1. An order of this Honourable Court for leave to substitute ‘POWER HOLDING COMPANY OF NIGERIA’ as the appellant on record in this appeal in place of ‘National Electric Power Authority’
- An order substituting POWER HOLDING COMPANY OF NIGERIA as the appellant on record in this appeal.”
The application is supported by a seven paragraph affidavit and a further affidavit of four paragraphs deposed to on 2-4-09. The respondent on the other hand filed a 12 paragraph counter-affidavit deposed to on 30-3-09 and a further and better counter affidavit deposed to on 2-4-09. The parties reduced their addresses into writing.
The contention of the applicant is that the National Council on Privatization has incorporated a holding company – Power Holding Company of Nigeria Plc, which holding company has acquired the assets and liabilities of the defunct National Electric Power Authority NEPA and should therefore substitute NEPA in this appeal as the appellant. The appellant relied on the provisions of Ss 1, 2 and 3 of the Electric Power Sector Reform Act CAPE 7 Laws of the Federation of Nigeria 2004. The respondents on the other hand contend that, both the National Electric Power Authority and the Power Holding Company of Nigeria Plc are dead and that the assets and liabilities of the National Electric Power Authority are vested in the successor companies and not The Power Holding Company of Nigeria Plc. They also relied on Ss 8, 10, 13 and 22 of the Electric Power Sector Reform Act.
This application and the contention arising therefrom revolves around the interpretation of the provisions of the Electric Power Sector Reform Act, Laws of the Federation of Nigeria 2004 as it relates to the appellant National Electric Power Authority otherwise called NEPA.
NEPA was not a company incorporated under the provisions of the Companies and Allied Matters Act. It was rather a corporate body created by the National Electric Power Authority Act. The National Electric Power Authority Act was repealed by S. 99 of the Electric Power Sector Reform Act 2004. I shall hereinafter refer to the Electric Power Section Reform Act as EPSRA. Section 1 of EPSRA mandates the National Council on privatization to not later than six months after the coming into force of that section of the Act to ‘Take Steps’ to incorporate an initial holding company under the Companies and Allied Matters Act. The National Council on privatization shall pursuant to S.3 of EPSRA cause to be transferred to the initial Holding Company the assets and liabilities of NEPA. There are uncontested evidence as per the applicant’s exhibit ‘A’ that the Power Holding Company of Nigeria PLC was incorporated on 5th May, 2005. The fact that Power Holding Company of Nigeria Plc is the initial holding company as provided for by S.1 of EPSRA is not in contention. It is also not contested that there was a transfer to it in accordance with the Act- the assets and liabilities of the defunct NEPA. It is therefore not in doubt that at this stage the Power Holding Company PLC inherited all the assets and liabilities of the defunct NEPA including this pending appeal.
However, by S.8 of EPSRA the National Council on Privatization was required not later than eight months after the incorporation of the initial holding company to incorporate under the Companies and Allied Matters Act such number of companies as it deems necessary which companies shall be successor companies to assume the assets and liabilities of the initial holding company. These companies shall not assume the assets and liabilities of the initial holding company as a matter of Law. S.10 of EPSRA makes very copious provisions for the transfer of these assets and liabilities to the successor companies. The transfer can only be effected by means of an order made by the National Council on Privatization. By S.10 (2) of EPSRA, such an order is binding on the initial holding company.
S.13 of EPSRA, provides as follows:
“13 Subject to section 10(7)(1), any cause of action or proceeding which existed or was pending by or against the initial holding company immediately before the subsequent transfer date shall be enforced or continued, as the case may be, on or after the subsequent transfer date by or against the designated successor company in the same way that it might have been enforced or continued by or against the initial holding company.”
S.12 of EPSRA releases the initial holding company from liability or obligation once the transfer of a liability or obligation has been effected. The respondents argued that indeed by 18 successor companies have been incorporated and that by operation of law, the initial holding company i.e. Power Holding Company of Nigeria was dead. I do not see the provisions of EPSRA leading to that conclusion. It is clear from the provision of S. 12 of EPSRA that the Act envisions the continued existence of the initial holding company even after the transfer of assets and liabilities to the successor companies.
By S. 22 of EPSRA, the National Council on Privatization may give directions to the Board of Directors of the initial holding company in writing in order to ensure the proper transfer of the assets and liabilities of the initial holding company to the successor company. Such direction may provide for the cessation of any or all functions of the initial holding company and its voluntary liquidation. There is nothing before us to show that the initial holding company has been or is in the process of being voluntarily liquidated, nor has anything been placed before us establishing that the National Council on Privatization has infact made any order effecting the transfer of the assets and liabilities of NEPA vested on PHCN on any company of any hue whatsoever. Even if it is correct that indeed successor companies have been incorporated, they only become relevant when the National Council on Privatization has by order effected the transfer of assets and liabilities. This, it has not done.
This application succeeds. The National Electric Power Authority is hereby substituted by Power Holding Company Plc as the appellant in this appeal. There shall be no order as to costs.
Other Citation: (2010)LCN/3716(CA)
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