National Union Of Civil Engineering Construction Furniture & Wood Workers V. United Bank For Africa Plc & Ors. (2010)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

RAPHAEL CHIKWE AGBO, J.C.A. (Delivering the Leading Judgment)

The appellant, pursuant to Order 40 of the Federal High Court (Civil Procedure) Rules 2000 as plaintiff took out an originating summons at the Lagos Division of the Federal High Court against the respondents as defendants in Suit No. FHC/L/CS/684/2007 seeking the following prayers:

‘1. A declaration that the plaintiff is a person interested within S. 389(1) of CAMA and entitled to make an application the court for appointment of a Receiver/Manager of the property and assets of the 3rd defendant.

2. A declaration that the 1st defendant is not a holder of a lawful debenture within the meaning of S.209 (1) CAMA as such is not entitled to realize its purported security purportedly created by a Deed of Debenture dated 17th January, 1984 stamped to cover N4 Million and purportedly unstamped on July 2004, to cover N280 Million.
3. A declaration that the Deed of Floating Debenture executed between the 1st and 3rd defendants dated 17th day of January, 1984 stamped to cover N4 Million and purported unstamped on 7th July, 2004 to cover N280 Million is a fraud on the 3rd defendant as such not registrable by the 4th defendant and enforceable against the 3rd defendant.
4. A declaration that the purported registration by the 4th defendant of the Deed of Floating Debenture between the 1st and 3rd defendants dated 17th day of January, 1984 purportedly unstamped on 7th day of July, 2004 to cover N280 Million is irregular, illegal, null and void and unenforceable in that it was obtained by fraud.
5. A declaration that the purported appointment of the 2nd defendant by the 1st defendant as Receiver/Manager of the property and assets of the 3rd defendant pursuant to the Deed of Floating Debenture purported executed by the parties dated 17th January, 1984 and purported unstamped to cover N280 Million on 7th July, 2004 is not valid but illegal null and void.
6. A declaration that in any event, the 2nd defendant as Receiver/Manager of the property and assets of the 3rd defendant is obligated to observe and comply with the provisions of S.390(2) of CAMA by way of preserving the assets of the 3rd defendant for the benefit of all the persons interested within S.389(1) of CAMA.
7. An order nullifying the purported appointment of the 2nd defendant by the 1st defendant as Receiver/Manager of the 3rd defendant.
8. A declaration that any sale and receipt of the assets including money or sums of money of the 3rd defendant by the 1st and 2nd defendants in pursuance of or purported execution of the power under the Deed of Debenture dated 17th January, 1984 as purported unstamped to cover N280 Million is wrongful and illegal as such recoverable by the 3rd defendant.
9. An order of injunction restraining the 1st and 2nd defendants by themselves their agents, servants and or privies from selling or dealing with the property and assets of the 3rd defendant in any manner whatsoever.
10. An order for account by the 1st and 2nd defendants jointly and severally of all money or monies received from the sale, lease, charge or in any way dealing with the assets and or property of the 3rd defendant since 2005.
11. An order of appointment where necessary, by the court of a Receiver/Manager of the property and assets of the 3rd defendant under the supervision or directions of the court.”

As required by the rules the appellant deposed to and annexed to the originating summons a 25 paragraph affidavit in support. Upon service on them of the originating summons the 1st – 3rd defendants, now 1st – 3rd respondents in this appeal filed a notice of preliminary objection praying as follows:

“NOTICE IS HEREBY GIVEN that the 1st, 2nd and 3rd defendants shall on the…….. day of…….., 2007 urge this Honourable Court to strike out this suit on the ground that this Honourable Court has no power and/or jurisdiction to determine this suit as presently constituted.

GROUNDS

1. The plaintiff has no locus standi within the meaning of Section 6(6)(B) of the Constitution of the Federal Republic of Nigeria and the decision of the Constitutional Supreme Court of Nigeria in the case of Adesanya vs. President of F.R.N. (1981) 5 SC 112 to institute this action and claim the reliefs endorsed therein.
2. That plaintiff does not come within the provisions of Section 299 of the Companies and Allied Matters Act, 1990 to commence this suit and seek the reliefs contained in same.
3. By the combination of (1) and (2) above, the plaintiff is not competent to bring and maintain this suit.”

The preliminary objection was accompanied by an affidavit in support which bears reproduction below:

“I, Peter Ojih, male, Christian, Nigerian National of No. 81, Foresythe Street, 1st Floor, Lafiaji Lagos do hereby make oath and state as follows:

1. I am the Senior Litigation Officer in the law Firm of Joseph Nwobike & Co., Counsel to the 1st – 3rd defendants in this suit by reason of which I am conversant with the facts of this case.
2. The facts contained in this affidavit were derived as a result of my official duties and information derived from persons and circumstances specifically stated hereunder.
3. I know that the 2nd defendant was appointed by the 1st defendant as the Receiver/Manager over the assets and undertakings of the 3rd defendant pursuant to the Floating Debenture dated 17th January, 1984.
4. I know that the plaintiff has no interest in the 3rd defendant and is neither a shareholder not a creditor of the 3rd defendant.
5. I have been informed by the 2nd defendant in our office today and I verily believe him that neither the 3rd defendant not himself and the directors of the 3rd defendant instructed or authorized the plaintiff to bring this action.
6. I know that the plaintiff’s interest does not exist in the 3rd defendant and that none is adversely affected by the acts of the 1st and or the 2nd defendants.
7. I have been informed by Ugochukwu Okwesili, Esq. of the Legal Services Department of the 1st defendant today in our office and I verily believe him to be true that the plaintiff is not a party to all the contracts and transactions between the 1st, 2nd and 3rd defendants; and that none was made in its favour.
8. That it will be in the best interest of justice if this suit is struck out since the plaintiff has not shown any interest in the 3rd defendant.
9. And I make this oath in good faith and in accordance with the provisions of the Oath Act, 1990,”

The appellant deposed to a counter-affidavit reproduced hereunder:-

“I, Bright Osabuogbe, MALE, Christian Nigerian Citizen of No. 68 Ipaja New Road Alimosho Lagos State do hereby make oath and state as follows:

1. That I am Assistant General Secretary of the plaintiff in this suit and by reason thereof I am very conversant with the facts of this.
2. That I swear to the facts in this counter-affidavit of my personal knowledge and belief as well as facts furnished me by persons hereinafter named.
3. That I have seen the notice of preliminary objection filed by 1st, 2nd and 3rd defendants dated 13th August, 2007 with the supporting affidavit and I verily believe there is no truth in the averments thereof particularly paragraphs 4, 6, 8 and 9 thereof.
4. That contrary to paragraphs 4, 5, 7 8 and 9 of the supporting affidavit, I verily believe that the plaintiff has disclosed sufficient interest upon the supporting affidavit to the originating summons content of which I hereby affirm as true and correct as such the plaintiff does not need the consent or approval of the 3rd defendant to institute this action.
5. That further to paragraph 4 above, the applicants’ preliminary objection with the supporting affidavit is in bad faith and I verily believe that it will be against the interest of justice to grant the applicants’ prayer.
6. That I am also advised by Johnson O. Esezoobo of Counsel and I verily believe that to strike out the suit will offend against State policy, under Cap. 11 of the Constitution in that it will amount to a denial of the plaintiff’s right of access to court under S.36 (1) of the 1999 Constitution.
7. That I swear to this counter-affidavit in good faith believing the content to be true and correct and in accordance with the Oaths Act of Nigeria.

After taking oral argument from the parties, the trial judge in a considered ruling, adjudged as follows:

“This action is misconceived in the present form and must be dismissed.”

Dissatisfied with this ruling the appellant filed this appeal. Its notice of appeal contains nine grounds to wit:

“1. The learned trial judge erred in law and exceeded the jurisdiction of the court when he found that the action “is misconceived and must be dismissed” contrary to the Supreme Court decision in Lakanmi vs. Adene (2003) 4 S.C (pt 11) 92 at 96 (2003) 10 N.W.L.R. (pt. 828) 353 thus: