From the Court

LANDMARK JUDGEMENT

 

IN THE SUPREME COURT OF NIGERIA

SUIT NO: SC101/2010

PETITIONER: SHINING STAR NIGERIA LIMITED & ANR

AND

RESPONDENT: AKS STEEL NIGERIA LTD & ORS

DATE DELIVERED: 2011-01-14

JUDGE(S): ALOMA MARIAM MUKHTAR, WALTER SAMUEL NKANU

ONNOGHEN, FRANCIS FEDODE TABAI, IBRAHIM TANKO

MUHAMMAD, MUHAMMAD

Judgment Delivered

This ruling is sequel to a motion dated the 28th July, 2010 and filed on the 29th of July, 2010. Motion prays for:-

  1. An order of interlocutory injunction restraining the Respondents their servants, agents, privies or through any person howsoever except Mr. Olusegun Bamidele Ajayi, the Receiver/Manage appointed by the Court of Appeal from running, operating and/or managing the 1st Respondent pending the determination of the appeal now pending in the Supreme Court.

Alternatively

  1. An order of Interlocutory mandatory injunction to undo what has been done restoring Mr Olusegun Bamidele Ajayi who has been physically removed as the Receiver/Manager pending the determination of the said appeal in this Court i.e Supreme Court.
  2. An order of interlocutory injunction restraining the 2nd and 3rd Respondents, their servants agents privies or any person howsoever from acting as directors of the 1st Respondent or from interfering with finance, securities and other business of the 1st Respondent pending the determination of the appeal in the Supreme Court.

And for such further or other orders which this Honorable Court may deem it fit to make in the circumstances The grounds for the reliefs sought in the application are set out in 11 paragraphs. The application is supported by an affidavit of 25 paragraphs to which were attached Exhibits SCK1, SCK2, SCK3, SCK4, SCK5, SCK6, SCK7, SCK8, SCK9, SCK10, SCK11 and SCK12. On that same 29th of July, 2010, the 2nd Plaintiff/Applicant deposed to an affidavit of urgency of26 paragraphs. The facts deposed to are substantially the same as those he deposed to in the 26 paragraph. The facts deposed to are substantially the same as those he deposed to in the 25-paragraph affidavit in support of the motion.

In opposition to the application, Mr Ayo Adesanmi, counsel in the Law Firm of Chief Wole Olanipekun SAN for and on behalf of the 1st to 3rd Dependants/Respondents (who are Respondent herein) deposed to a counter affidavit of 94 paragraphs to which were attached Exhibits 1- 23. This was on the 13/10/2010. On that same day, on behalf of the 1st – 3rd Respondents, Chief Wole Olanipekun SAN filed a Notice of preliminary Objection to urge the dismissal or striking out of the motion. The grounds of the Preliminary Objection are that

(i) The party on whose behest and/or for whose benefit the application is being sought is not an appellant before this court or a party to the appeal proceedings.

(ii) The entire application is incompetent

(iii) If countenanced at all and/or granted, the application will dispose of the appeal against the ruling complained of by the Appellant and also dispose of the appeal at the lower court.

(iv) The application is a gross abuse of the processes of superior courts of record in Nigeria as:

(a) While the Appellant’s appeal to the Court of Appeal against the decision of the trial High Court of 1st July, 2009 discharging the appointment of Olusegun Ajayi as the Receiver/Manager for the 1st Respondent and filed a motion at the lower court asking the lower court to upturn the discharge order of the trial High Court, the same Appellants through the same counsel instituted five different actions at the Federal High Court, Lagos in the name of the said Olusegun Ajayi as a Receiver/Manager of the 1st Respondent in suit No FHC/L/CS/898/09 FHC/L/CS/899/09, FHC/L/CS/900/09, FHC/L/CS/901/09 and FHC/L/CS/897/09 claiming far reaching injunctive reliefs against some banks named Defendants.

(b) Appellants did not inform the Federal High Court, Lagos of the pendency of their substantive appeal and application at the Court of Appeal.

(c) Appellants did not inform the Federal High Court of the discharge of the appointment of Olusegun Ajayi as Receiver/Manager by another judge of the Federal High Court on 1st July, 2009.

(d) Appellants have deliberately hidden the facts adumbrated in (a) (b) and (c) supra before this court.

(e) The Appellants/Applicants unilaterally changed the title of the case in their application from what it is/was in their Notice of Appeal filed in this court and from those of the parties appearing in the Ruling of the lower court appealed against.

(v) The Supreme Court is without jurisdiction to countenance and/or grant the prayers contained in the body of the appellant’s application.

(vi) The said application is not in conformity with the mandatory demand of Order 2 Rule 28 of the Supreme Court Rules.

When the application and the preliminary objection was argued on the 19th of October, 2000 Prof. S. A. Adesanya SAN for the Appellants/Applicants made reference to the ruling of the Court of Appeal dated the 19th of March, 2009, the appointment of Mr. Olusegun Bamidele Ajayi by the Chief Registrar Federal High Court on the 23rd of March, 2009 as the Receiver/Manager of the 1st Respondent, the appeal by the Respondents to this Court against the ruling of the Court of Appeal of 19th March, 2009, and the appointment of the Receiver/Manager pursuant thereto and the ruling of the trial Federal High Court of the 1st July, 2009 discharging the appointment of Receiver/Manager of the 1st Respondent and argued in substance that the orders of the trial court some of which were not even sought amounted to multiple abuses of the court process. Learned senior counsel urged particularly the grant of the alternative prayers for an order of interlocutory mandatory injunction to undo what has been done by restoring Mr. Olusegun Bamidele Ajayi as the Receiver/Manager of the 1st Respondent. He also urged the grant of interlocutory injunction restraining the 2nd and 3rd Respondents their servants, agents and or privies from acting as directors of the 1st Respondents or from otherwise interfering with the finances and other businesses of the 1st Respondent pending the determination of the appeal at this court. Learned senior counsel further argued that on his appointment as Receiver/Manager of the 1st Respondent on the orders of the Court of Appeal, Mr Olusegun Ajayi became an officer of the Court by virtue of the provisions of Section 389(i) of the Companies and Allied Matters Act and that he was not a party in the proceedings. It was learned senior counsel\’s further contention that unless this application is granted in terms of the prayers sought, the appeal before the court will be rendered nugatory. Learned senior counsel even urged the grant of a mandatory injunction setting aside the orders of the trial High Court. He referred to the counter affidavit of the Respondents especially paragraphs 5 – 85 and remarked that the facts deposed therein aired all stories of what happened at the trial court. He urged in conclusion that the application be granted. On his part, Chief Wole Olanipekun SAN counsel for the Respondents argued in substance as follows.

The application he submitted was incompetent and a gross abuse of the processes of the Court. It was his submission that if, in the determination of this application, this Court would not take cognisance of what happened at the trial then that takes out the bottom of this application since the entire application was premised on or in reaction to the orders of the trial court in its ruling on the 1st July, 2009. He referred to the Applicants Notice of Appeal at page 51 of the application wherein the Chief Registrar of the Federal High Court is stated to be the 4th Respondent and referred further to relief 3 of the Notice of Appeal at page 58 of the application where an order of injunction is sought against the Chief Registrar of the Federal High Court and submitted that the reliefs sought against him cannot be granted since he was not yet a party. He submitted that if the applicant/appellants want to withdraw against the 4th Respondent they can only do so by way of a written application. It was further contended that the first prayer of the application was rather at large.

With specific reference to Mr. Olusegun Ajayi as Receiver/Manager, learned senior counsel referred to seven different originating processes filed at the Federal High Court wherein he was made a party. He urged finally that the application be dismissed.

In his reply Prof. S. A. Adesonya SAN argued that a preliminary objection to the application can only be based on the materials presented before the court by the applicants. He contended further that the Respondents were only trying to argue the appeal under the guise of a preliminary objection, and urged that the preliminary objection be dismissed.

I have considered the application, the grounds of the application, the 25 and 26 paragraph affidavits in support thereof, the 94 paragraph counter affidavit, the preliminary objection and the address of counsel for the parties I shall first of all make recourse to the history of the case from the inception up to the 29/7/2009 when the present application under consideration was filed with particular reference to some documents/processes relevant to the determination of the issues raised in this application. The action itself was initiated in 2006.

In paragraph 20 of the statement of claim the plaintiffs who are the Appellants/Applicants herein claimed against the Defendants/Respondents jointly severally or in the alternative as follows:

  1. A declaration that the Plaintiff’s 58.3% majority equity holding in the 1st Defendant is still valid and subsisting.
  2. A declaration that the Resolution of the Board of Directors of the 1st Defendant company purportedly passed on the 31st day of October, 2005 but filed on the 17th day of January 2006 was never held and never passed or any other resolution diluting or reducing the 58.3% majority equity shareholding of the Plaintiffs in the 1st Defendant is null and void and ineffective.
  3. A declaration that the equity holding structure in the Defendant company as at 27/07/2005 is still valid and subsisting.
  4. A mandatory injunction compelling the Defendants to revert back to the share holding structure held as at 27/07/2005 by filing the statutory Forms at the Corporate affairs Commission to reflect the valid equity shareholding structure which stood at 27/07/2005.
  5. An Order compelling the Defendants to prepare and submit to the court a comprehensive Financial Statement.
  6. An Order compelling the 2nd Defendant to refund the N32,000,000.00 fraudulently removed from the 1st Defendant’s account and misappropriated by the 2nd Defendant.
  7. An Order compelling the Defendants especially 2nd and 3rd Defendants to account for the N27,000,000.00 loan granted by way of credit on countless promissory notes for steel ingots supplied to Aks Alloys PVT (India) Limited which is a company owned by Mr. Nemi Chand Kothary, the 3rd Defendant.
  8. An Order compelling the defendants to prepare the Annual Directors statement of the 1st Defendant and made same available to the shareholders.
  9. An Order compelling the Defendants to pay for the cost of the Plaintiffs actions being a Derivative for the benefit of the 1st Defendant and the shareholders.
  10. Ubi Jus Ibi remedium.
  11. And for such further order or orders to meet the ends of justice in the case.

At the trial High Court, the Appellants/Applicants as plaintiffs sought and obtained an interim ex-parte order on the 19/01/2007 for the appointment of the Receiver/Manager to manage the affairs of the 1st Respondent Company pending the determination of the substantive motion on notice for an interlocutory order for the same relief. The interlocutory order for the appointment of a receiver Manager was sought to pend the determination of the suit. The Respondents herein as Defendants brought an application for an order discharging the ex-parte interim order of the 19/012007. The Respondents’ application for the discharge of the interim order appointing a receiver/manager and the Applicant’s application for the appointment of a receiver/manager were consolidated and heard together.

By its ruling on the 28/02/2007 the interim order appointing a receiver/manager for the 1st Respondent was vacated.

The trial court however refused to consider the Applicant’s application for the appointment of a receiver/manager for reasons stated in the ruling.

Both parties are advised to pursue all the appeals pending in all the Courts. Thirty thousand naira (N30,000) costs are

awarded in favour of the appellants/applicants in this application.

Application is granted.

Prof. S.A. Adesanya. SAN

with him

Waheed Kasali ……… For the Appellants

Chief Wole Olanipekun. SAN ” For the 1st ‘ 3rd Respondents

with him

Gbenga Adeyemi ;  Ayo Adesanmi;  A. Adeyemo

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button