Spectra Limited & Anor V. Stabilini Visioni Limited & Ors (1999)

LawGlobal-Hub Lead Judgment Report

OGUNTADE, J.C.A.

The respondents were the petitioners at the Federal High Court, Lagos. They claimed against the respondents the following reliefs:

“1 (a) That an investigation be ordered and carried out into the affairs of the 1st respondent pursuant to section 315 of CAMA on the ground that the persons concerned with the management and operations thereof have in connection therewith, been engaged in fraud, misfeasance and other misconduct towards the company or its members (including your petitioner) and the company’s members have not been given all the information with respect to its affairs to which they are reasonably entitled.

(b) That an investigation be carried out into the affairs of the company with regard to its compliance with the CAMA and all other laws regulating the operations of companies in Nigeria.

2. A declaration that the 2nd-4th respondents are not fit and proper persons to act or be appointed as directors of any company in Nigeria and that they are incapable of effectively directing the affairs of and managing the 1st respondent.
3. A detailed account be taken of all the funds of the 1st respondent paid into the personal account of the 2nd respondent or any other account held by the 2nd-4th respondents.
4. A detailed account be taken in respect of all sub-contracts awarded by the company in respect of all construction jobs undertaken by the company between 1989 till date.
5. A detailed account be taken in respect of all purchases of building materials by the 1st respondent from 1989 till date.
6. A detailed account be taken into how much of the 1st respondent’s funds were illegally or unlawfully withdrawn by the 2nd, 3rd and 4th respondents between 1992 and 1994.
7. Upon the accounts and investigations aforesaid being carried out, an order directing the 2nd-4th respondents to return into the coffers of the 1st respondent all monies found to have been illegally or fraudulently taken or otherwise taken without authority of the company’s board of directors or shareholders.

The petition wherein the Petitioners claimed the above reliefs was filed on the 7th of June, 1995. On the same date, the petitioners brought an ex-parte application praying for the following orders:

“An order of interim injunction restraining the 2nd-4th respondents from acting and/or parading themselves as directors of the 1st respondent or from otherwise interfering in any manner with the operations of the 1st respondent pending the determination of the motion on notice.

2. An Anton Piller order:

(a) compelling the respondents to deliver all account books including banks, files, cheque books, ledgers, and all documents relating to all the bank accounts of the 1st respondent covering the period from 1989 to March 1995 to the petitioners;

(b) compelling the respondents to deliver to the petitioners all cheque books, statements and all other documents relating to the personal foreign bank account of the 2nd respondent into which funds of the 1st respondent were paid:

(c) compelling the respondents to deliver to the petitioners all documents relating to all construction contracts entered into by the 1st respondent covering the period from 1989 to March 1995;

(d) directing the respondents to permit a search of the premises of the 1st respondent and the homes of the 2nd, 3rd and 4th respondents to enter upon the same and examine all the documents relating to the affairs of the 1st respondent found therein and make copies thereof;

(e) directing the board of directors of the 1st respondent to appoint an independent firm or auditors to examine the books and other documents referred to above and report its findings to the court.

3. And order of interim injunction restraining the 2nd-4th respondents from travelling out of the jurisdiction of this honourable court without the permission of the honourable court pending the determination of the motion on notice filed herein.
4. Such further or other orders as this honourable court may deem fit to make.”?

It is pertinent to say here that a similar application on notice was filed on the same 7th June, 1995. The application ex-parte came before Odunowo J. on 8th June, 1995, when it was argued by Dr. Layonu, counsel for the petitioners. After hearing the application, the learned Judge made a ruling in these words:

“Based on the overwhelming evidence adduced in support of this application, I am satisfied that all the orders sought herein are fully justified. Accordingly all the orders sought in terms of the motion ex parte dated 6th June, 1995 and filed on 7th June, 1995 are hereby granted as prayed. In addition the 2nd-4th respondents shall deposit their passports with the registrar of this court pending the hearing and determination of the motion on notice. Finally, the petitioners shall give a substantial undertaking in damages. The case is adjourned to 15th June, 1995, for mention.”?

The respondents before the lower court were dissatisfied with the ex-parte order of Odunmvo J. They appealed against it. In their amended notice of appeal they raised six grounds of appeal. In their appellants’ brief, the issue for determination were stated to be the following: