NDO STATE & ORS v. OKITIPUPA OIL PALM PLC & ORS (2015)

ATTORNEY GENERAL OF ONDO STATE & ORS v. OKITIPUPA OIL PALM PLC & ORS

(2015)LCN/7897(CA)

In The Court of Appeal of Nigeria

On Friday, the 12th day of June, 2015

CA/AK/233/2013

RATIO

COURT: JURISDICTION; WHETHER THE INCOMPETENCY OF AN ACTION WILL CREATE A PRIMARY ISSUE OF JURISDICTION
The incompetency of an action does not create a primary issue of jurisdiction it could at best create a collateral issue of jurisdiction. Put in another way, a distinction must be drawn between two types of jurisdictions namely: jurisdiction as a matter of procedural law and jurisdiction as a matter of substantive law. Whilst a litigant can waive the former, no litigant can confer jurisdiction on the Court where the Constitution or a statute or any provision of the common law says that the Court does not have jurisdiction. A litigant may submit to the procedural jurisdiction of the Court but not to the substantive jurisdiction. See: Ndayako v. Dantoro (2004) 13 NWLR (Pt. 880) 187. per. MOJEED ADEKUNLE OWOADE, J.C.A.

COURT: JURISDICTION; THE EXCLUSIVE JURISDICTION OF THE FEDERAL HIGH COURT IN CIVIL CAUSES AND MATTERS ARISING FROM THE OPERATION OF THE COMPANIES AND ALLIED MATTERS ACT

Clearly, and contrary to the suggestion of the learned counsel for the Appellants, the above are claims relating to the operation of companies and Allied Matters Act as contemplated by the Provision of Section 251 (1) (e) of the 1999 Constitution (as amended).
Section 251 (1) (e) of the 1999 Constitution reads thus:
“251 – (1) notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters-(e) arising from the operation of the companies and Allied Matters Act or any other enactment replacing that Act or regulating the operation of companies incorporated under the companies and Allied Matters Act.” per. MOJEED ADEKUNLE OWOADE, J.C.A.

JUSTICES

MOJEED ADEKUNLE OWOADE Justice of The Court of Appeal of Nigeria

MOHAMMED AMBI-USI DANJUMA Justice of The Court of Appeal of Nigeria

JAMES SHEHU ABIRIYI Justice of The Court of Appeal of Nigeria

Between

ATTORNEY GENERAL OF ONDO STATE & 6 ORS. – Appellant(s)

AND

OKITIPUPA OIL PALM PLC & 4 ORS. – Respondent(s)

MOJEED ADEKUNLE OWOADE, J.C.A. (Delivering the Leading Judgment): This is an appeal against the Ruling of the Federal High Court sitting in Akure, Ondo State, delivered by Honourable Justice I. M. Sani on the 28th day of October, 2013.

The Respondents by a petition dated the 19th day of April, 2012 commenced an action against the appellants seeking various reliefs pursuant to Section 299,301, 310, 311 (2) of the Companies and Allied Matters Act, 2004 (CAMA) as well as Section 251 (1) (e) of the Constitution of the Federal Republic of Nigeria 1999 (as amended).

The reliefs claimed by the Respondents as petitioners as contained in paragraph C (1 – 10) of their petition are as follows:
(1) A DECLARATION that the purported removal (vide the letter of the 3rd Respondent to the 3rd petitioner dated 13th March, 2012) of the General Manager from office by the Ondo State Government, its agents or servants, whosoever deriving authority from it, is illegal, null and void as being against the provisions of Companies (and Allied Matters) Act 2004, Memorandum and Articles of Association, interest of the shareholders and members of the 1st

petitioner and its members.
(2) A DECLARATION that the purported appointment of another General Manager and or Managing Director (vide the letter of the 3rd Respondent to the 3rd petitioner dated 13th March, 2012) and other officers for the 1st petitioner by the Ondo State Government, its agents or servants or whosoever deriving authority from it, is illegal, null and void and contrary to the provisions of Companies (and Allied Matters) Act 2004, Memorandum and Articles of Association and the judgment of this Honourable Court in FHC/AK/CS/49/96 Ologunleko & Ors. V. Military Administrator Ondo State & Ors.
(3) A DECLARATION that Ondo State Government is not a member and shareholder of the 1st petitioner and as such has no power to appoint Directors or intefere with the management and day to day running of the 1st petitioner.
(4) A PERPETUAL INJUNCTION restraining Ondo State Government, through the 1st Respondent, its agents or servants and whosoever deriving authority from it from interfering with or appointing Directors to the Board of the 1st Petitioner.
(5) A PERPETUAL INJUNCTION restraining the Respondents, their agents, servants,

and other such representatives from intermeddling with affairs of the said 1st petitioner except in accordance with its Memorandum and Articles of Association and/or the Companies and
(6) A PERPETUAL INJUNCTION against the 7th Defendant stopping him from parading himself as the Managing Director of the 1st petitioner, except in conformity to the procedure as enunciated in the Memorandum and Articles of Association of the Company and the Companies (and Allied Matters) Act 2004.
(7) AND ORDER under S. 312 (e) Companies and Allied Matters Act, 2004 directing the 1st petitioner to institute proceedings and prosecute the 7th Defendant for illegally acting and holding himself out as a Managing Director without being duly appointed by the Board of Directors of the 1st petitioner contrary to S. 244 (3) Companies and Allied Matters Act, 2004.
(8) AN ORDER for the purchase of the shares of the 2nd Respondent, who is a minority shareholder in the 1st petitioner, by other members of the 1st petitioner.
(9) AN ORDER directing the 6th and 7th Respondents to render a full account of all the affairs of the said 1st petitioner from the 6th day of March,

2012 to the date of handover to the 1st petitioner, as managed by them under their assumed role of Managing Director.
(10) THE 1ST PETITIONER CLAIMS EXEMPLARY DAMAGES of N100,000,000. 00 (One Hundred Million Naira) against the Respondents for wrongfully intermeddling with the affairs of the 1st petitioner as aforesaid.

The petitioners claim from the Respondents jointly and severally the above reliefs in the petition.
The facts of the case as presented in the pleadings of the Respondents as petitioners are as follows:
2.01 The 1st Respondent was incorporated in May, 1976 as a Private Limited Liability Company. In 1989, it was converted to a Public Liability Company with over 15, 000 shareholders.
2.02 The shareholding distribution is as follows:-
– Estaport Farms Limited – 35%
– General Public -33%
– Ondo State Investment Holding Company Ltd. -29%
– Staff Co-operative -3%
2.03 The 2nd Respondent is the Chairman of the Board of Directors of 1st Respondent, the 3rd and 4th Respondents are representatives of Estaport Farms Limited, the single largest shareholder in the 1st Respondent Company and are members of

the Board of Directors of the 1st Respondent,

The 5th Respondent is a Director in the 1st Respondent, representing the land Owners and host communities on the Board of Directors of the 1st Respondent.
2.04 The 1st Appellant is the Attorney General of Ondo State, thus the Chief Legal Officer representing Ondo State Government.
The 2nd Appellant is a minority shareholder holding about 29% of the 1st Respondent’s shares. The 3rd, 4th and 5th Appellants are public servants, and Directors of 1st Respondent, representing the interest of 2nd Appellant on the Board of Directors of the 1st Respondent. The 6th and 7th Appellants are persons brought in by the 3rd Appellant to the affairs of the 1st Respondent and assume the role of the General Manager and Managing Director respectively
2.05 Sometime in March 2012, Mr. Henry Olatujoye, the General Manager/Chief Executive Officer of the 1st Respondent at the Company premises was arrested by two policemen from Akure on some allegations made by the 3rd Appellant, without reference to the Board of Directors on the alleged offences of Mr. Henry Olatujoye,
2.06 The 6th Respondent, who is neither a

member of the Board nor a member of management of the 1st Respondent with two other policemen and thugs illegally stayed in the company premises, breaking doors and changing keys of the various offices of the General Manager and the management staff in order to take over the management of the company.
An emergency meeting of the Board of Directors meeting was called into the 1st Respondent’s premises on the 9th of March, 2012 at Okitipupa, with a view to finding out happenings in the company and why the Mr. Henry Olatujoye, the General Manager was arrested by the police at the instance of the 3rd Appellant.
When the 2nd – 5th Respondents got to the gates at 11.00am, they were prevented entry by 3 Policemen who were stationed at the gate.
2.07 The said policemen refused the said directors entry and stated that the Divisional Police Officer at Okitipupa gave instructions that the meeting should not hold. The directors were asked to meet with the Divisional Police Officer at the Okitipupa Police Station. The Divisional Police Officer, CSP Lasisi confirmed that the order he had was ‘from above’ at Akure, which was to the effect that the Directors

should not be allowed to enter the 1st Respondent’s premises to hold the meeting of the Board of Directors.
2.08 While illegal occupiers of the company premises kept out the management, workers, and Board of Directors of the company with the aid of armed men and thugs, on March 13th 2012, the 2nd Respondent, the Chairman of Board of Directors wrote a letter to His Excellency Dr. Olusegun Mimiko, Governor of Ondo State on the deprivation of the constitutional right to peaceful Assembly of members of the Board of Directors of Okitipupa Oil Palm Plc and the unlawful hijacking of the 1st Respondent (a public company) from the Board of Directors and management. See page 87 of the records of appeal.
2.09 The 2nd Respondent on 16th March, 2012, advertised a caveat emptor in 2 National Dailies – The Guardian and the Nation, informing the General Public of the brazen act of lawlessness of the 3rd Appellant and advising the General Public not to deal with the intermeddlers.

On Wednesday March, 13th 2012, Mr. Henry Olatujoye who had been arrested by the Police after investigation of the various allegations lodged by the 3rd Respondent against him without

reference to the Board of Directions was released by the Police without prosecution as the Police could not find any act of wrong doing against the General Manager – Mr. Henry Olatujoye.
2.10 The 2nd Respondent and Estaport Farms Ltd on Sunday, the 18th day of March, 2012 received a letter through Courier Service (DHL), informing the Respondents and Estaport Farms Ltd that Ondo State Government had removed Mr. Henry Olatujoye from the company and brought one Engr. Niyi Ogunwa, the 7th Appellant to be the Managing Director of the company.
2.11 The Board of Directors had at no time sat to consider the appointment of Engr. Niyi Ogunwa as a Managing Director of the 1st Respondent and the Respondent contend that Ondo State Government has no right nor powers to nominate the Managing Director or Director of the 1st Respondent an action contrary to and in disobedience to the judgment of the Federal High Court sitting in Akure in suit no FHC/AK/CS/49/96: Ologunleko & Ors. V. Military Administrator Ondo State & Ors to the effect that Ondo State Government and Attorney General of Ondo State did not have the powers to appoint or remove the Directors of

the 1st Respondent being a Public Liability Company. See pages 92 and 93 of the records.
2.12 At about 2pm on Wednesday, 21st March 2012, Estaport Farms Ltd and 3rd, 4th and 5th Respondents received a letter of demand for the repayment of a loan of N239,000.00 with interest allegedly granted to the 1st Respondent in September 2006 by Ondo State Government.
2.13 The 2nd, 3rd 4th and 5th Respondents subsequently held an emergency meeting on the 9th day of March, 2012 at the premises of OH petroleum Ltd, Igbokoda, Ondo State where the decision to institute the action was taken to save the 1st Respondent from the illegal takeover by the Appellants.

On the other hand, the Appellants in their Reply to the Respondents petition stated that:-
2.01 The Ondo State Government through its Ondo State Investment Holding Ltd. Owns 29% (Twenty Nine per cent) of the equity share of the 1st Respondent Company while the 2nd and 3rd Respondents through their Estapoft Farms Limited own 35% shares, the General Public has 33% and the staff cooperative has 3% shares.
2.02. Sometimes in year 2009, the 1st Respondent Company, Okitipupa Oil Palm Plc. was

indebted to Guarantee Trust Bank (GTB) Plc. to the tune of 165,000,000. 000 (One Hundred and Sixty – Five Million Naira) and could not pay the debt, Pursuant to the said debt of the Company, GT Bank appointed a receiver manager to take over the Company and liquidate same. The receiver manager intended to sell off the 1st Respondent Company to recover the bank’s money and had commenced active liquidation process of the Company.
2.03. The Ondo State Government, the promoters of the 2nd Appellants, in the interest of its investment in the Company and the security of the employment of the people of Ondo State working in the Company rescued the Company and pay the debt the Company owed GT Bank Plc. by the agreement upon which the Ondo State Government bailed out the 1st Respondent Company from the receivership of the GT Bank, the Ondo State Government was entitled to be allotted more than 70% of the shares of the 1st Respondent Company. By the agreement also, the Ondo State Government and the two major shareholders of the Company, Estaport Limited and the Ondo State Investment Holdings Ltd were to mutually employ their best endeavour to save the Company

from further adverse effects of the huge indebtedness of the 1st Respondent.
2.04 Pursuant to the agreement to cooperate in the mutual and effectual running of 1st petitioner, the Ondo State Government nominated the former General Manager of the 1st Respondent, one Engineer Olatunjoye, unknown to her that the appointment of the said General Manager had previously been terminated from the Company due to various allegations bordering on the misappropriation of the funds of the 1st Respondent Company. On becoming aware of the facts, the Ondo State withdrew the nomination of the said General Manager and replaced him with the 6th Appellant pending the ratification of the appointment by the Board of Directors of the 1st Respondent Company.

On 12th day of June 2012, the Appellants filed a Notice of Preliminary Objection praying that the Respondents petition be dismissed/struck out for being incompetent as the Honourable Court lacks jurisdiction to entertain same.
The grounds and particulars of the objection are as follows:
1. The suit is an abuse of Court process as the substance of the suit relates and concerns the employment and removal of the

General Manager of the 1st petitioner which is already pending before the National Industrial Court.
2. The Petitioners have no locus standi to file the suit on behalf of the General Manager of the 1st petitioner.
3. The General Manager of 1st petitioner not being a party to the suit, this Honourable Court is bereft of jurisdiction in the suit as it cannot make an order affecting him.
4. The suit is not that which can be commenced by petition under the Rules of this Honourable Court and the Companies and Allied Matters Act as it does not relate to the management and control of Company.
5. The substance of the allegation in the suit are mainly bordering on trespass against the 6th – 7th Respondents which can only be commenced by writ of summons before the High Court of Ondo State.
6. The Company resolution authorizing the institution of the suit reached at the emergency meeting of the Board of Directors of the Company held on Friday, 9th March, 2012 at the premises of MOH Petroleum Ltd. Igbokoda was reached without the required quorum of the Company as provided by Article 101 of Article of Association of the 1st Petitioner.

effect, the preliminary objection challenged the jurisdiction of the trial Court to entertain suit on grounds that the petition was incompetent not being a matter that arose from the operation of the Companies and Allied Matter Act.
The learned trial judge in his ruling of 8 – 11 – 13, held that the suit was properly commenced by petition under Section 311 of the Companies and Allied Matters Act (CAMA) and since the 2nd, 3rd and 4th petitioners are Directors and shareholders of the 1st petitioner, they have the statutory right and a standing to sue, as such, the principle or Rule in Foss V. Harbottle does not apply.

He also held that the Respondents suit does not constitute abuse of process as the parties and reliefs sought in the Court and the National Industrial Court are not the same.
Finally, the learned trial judge dismissed the Appellants Notice of Preliminary Objection.
Dissatisfied with the above ruling, the Appellants filed a Notice of Appeal (containing three (3) or perhaps four grounds of appeal) before this Court on 18 – 10 – 2013.
Appellants brief of argument dated 3 – 2 – 2014 was filed on the same day. Respondents brief

of argument dated 19 – 3 – 2014 was also filed on the same day.

Learned counsel for the Appellant nominated a sole issue for determination thus:-
“Whether or not in view of the cause of action in the suit, the learned trial judge was right in holding that he had jurisdiction to entertain the suit pursuant to Section 251 (1) (e) of the 1999 Constitution (as amended)“
Learned counsel for the Respondents similarly formulated one (1) issue for determination to wit:
“Whether the trial Court erred in law when it held that it had jurisdiction to entertain the action with regards to the peculiar facts and circumstances of the case”
In arguing the sole issue for determination, learned counsel for the Appellants submitted that the Federal High Court is a Court of Limited jurisdiction and that the jurisdiction is Limited to the items stated in Section 251 (1) of the 1999 Constitution as amended.
He referred to the case of Oladipo V. NSCB (2009) 12 NWLR (Pt. 115) 563 at 585 and added that when the subject matter of a suit cannot be accommodated on the train of the eighteen (18) items listed under Section 251 of the 1999 Constitution, the

Federal High Court will not be the proper Court to be approached, that is the Court lacks jurisdiction to entertain such suit.

He submitted that the parties cannot confer jurisdiction on the Court by way they couch their action. Jurisdiction of Court is regulated by statute.
On this, counsel referred to the case of Onyenucheva V. Military Administrator of Imo State (1997) NWLR (Pt.482) 429.
He argued that the lower Court misdirected himself and came to a wrong conclusion when he held that the Court has jurisdiction to entertain the suit when it was glaring that the subject matter of the suit is mainly an employment matter and the General Manager of the 1st Respondent company on whose subject was the main issue in the petition has approached the National Industrial Court to ventilate his grievances. The fact that the suit No. NICN/IB/09/2012 is still pending in the National Industrial Court was not controverted by the Respondents.
Appellants counsel submitted further that the lower Court lacks jurisdiction to entertain the suit as the subject matter fell out of the provision of Section 251 (1) (e) of the 1999 Constitution. That Section 251

(1) (e) of the 1999 Constitution only contemplate such matter as dispute on shareholding structure of a company, ownership and control, merger, takeover and acquisition, insolvency, winding – up etc and not mere employment matter or at best trespass by the 6th and 7th Respondents to the properties of the company.

The lower Court, he said, was therefore in error to have equated the dispute in issue to issue relating to the operation of the Companies and Allied Matters Act.
Appellants counsel referred to the cases of S. P. D. C. (Nig) Ltd. V. X. M. Fed. Ltd. (2006) 16 NWLR (Pt. 1004) 189 at 200 – 251 and Chief Afolayan V. Oba Ogunrinde & 3 Ors (1990) 1 NWLR (Pt.127) 369 at 371 for the meaning of cause of action. He argued that from the reliefs contained in the petition of the Respondents, the cause of action has to do mainly with the removal and replacement of the former General Manager of the 1st Respondent and a declaration that the Ondo State Government is not a member of 1st Respondent. That Ondo State Government has not in any place contended that she is a member of the 1st Respondent but only assert a right pursuant to bail out agreement

wherein the 1st Respondent was bailed out from the liquidation by GT Bank. The cause of action in the suit according to counsel, therefore cannot be said to be in respect of the operations of Companies and Allied Matters Act Pursuant to Section 251 (1) (e) of the 1999 Constitution as amended.

On this, counsel referred to the case of Tukur V. Governor of Gongola State (1989) 4 NWLR (Pt. 117) 517 and submitted that from the Respondents petition, it would be seen that the suit is mainly against the withdrawal from office of the former General Manager and alleged trespass of the 7th Appellant which admittedly the Respondents aver are not shareholders of the 1st Respondent company.
On another wicket, Appellants counsel submitted further that the learned trial judge wrongly assumed jurisdiction in the matter as the Respondents did not fulfill the condition precedent laid down in the Articles of Association of the 1st Respondent Company.
He submitted that the provision of Section 101 of the said Articles of Association of the 1st Respondent company specified that there must be at least 6 (six) directors in attendance at the meeting of the Board of

Director.

The Respondents, he said, were only five in attendance at the meeting and only five directors signed the resolution where the decision to institute the petition was taken. The sixth Director, one Chief Igbasan by an affidavit disclaimed participation in the meeting and his name was subsequently struck out from the suit upon the application of the Respondents.

Counsel submitted that the provision of Section 101 of the Articles of Association of the 1st Respondent Company must be complied with. It is a condition precedent for the Respondents to institute the suit.
The failure to attain the request quorum in the directors meetings where the decision to institute the suit was taken constitutes a feature and render the suit incompetent and the lower Court is therefore bereft to jurisdiction.
He submitted further referring to the cases of Niger care Dev. Co. Ltd. V. A. S. W. B. (2008) 9 NWLR (Pt. 1093) 498 at 520 and Amadi V. N. N. P. C. (2000) 10 NWLR (pt. 674) 76 that failure to attain the requisite quorum is not a mere irregularity as contended by the Respondents but a fundamental defect which render the suit incompetent.

any event, that the Appellants timeously raised an objection to it, thus the Court is bound to set aside, the suit as irregular, null and void.
On yet a third ground, Appellants contend that the Respondents had no locus standi to institute the petition on behalf of a General Manager who himself was not made a party in the suit.

Counsel said the former General Manager of the company is the only person that can bring an action against a wrong against his person if there is any and appropriately, the said former General Manager has filed a suit at the National Industrial Court against the Ondo State Government.
He submitted that the present suit as instituted for act against the said General Manager by the Respondents is an abuse of the process of Court.
And, that, where there is multiplicity of action in respect of a subject matter, it constitutes abuse of Court process and liable to be struck out.
He referred to the case of CBN V. Ahmed (2001) and urged us to hold that the lower Court was wrong to have assumed jurisdiction in the matter.
The fourth leg of Appellants sole issue is counsel’s argument that by the provision of

Section 303 (1) of the Companies and Allied Matters Act 2004, where minority members of a company intend to sue in the name of the company for the protection of the company or to prevent a wrong against the company they require the leave of the Court.
That, the leave of Court must first be sought and obtained before they can bring a valid suit.

He argued that the 2nd to 5th Respondents not being the majority shareholders of the company require the leave of the Court to institute the suit. That in the petition, the Respondents did not seek the leave of the Court before bringing the petition at the lower Court. This, he said constitutes a fundamental defect which renders the suit incompetent. That by reason of this defect in law, the lower Court lacks jurisdiction to entertain the suit.
On this, Appellants counsel referred to the cases of Kayode v. State (2008) WRN (Vol. 2) 102 at 106.
Coop & Anor. V. Enugu State (1992) 7 NWLR (pt. 262) page 52 and Okofo Aribisala V. Ogunyemi (2005) 6 NWLR (pt. 921) 212 and submitted that where a statute, imposes a condition precedent before doing an act, the failure to comply with the condition precedent

renders the act invalid. He further referred to the case of Nwabueze V. Okoye (1988) 4 NWLR (pt. 91) 664 at 713 and urged us to hold that the requirement of Section 303 (1) of CAMA is mandatory and the failure to comply with it renders the suit incompetent and the Court lacks jurisdiction to entertain same.

Learned counsel for the Respondents on the other hand submitted that the jurisdiction of trial Court to hear and determine the suit is determined by the Respondents petition and accompany processes.
He referred to the case of Adeogun v. Fashogbon (2008) 17 NWLR (part 1115) 149.
He argued that a careful perusal of the averment in the petition shows that a substance of the suit does not relate to the employment and removal of Mr. Henry Olatujoye, the General Manager of the 1st Respondent as alleged by the Appellant’s in their Notice of Preliminary objection which was dismissed by the trial Court.
Counsel submitted that the action/petition relates to the management and control of the 1st Respondent, a limited Liability Company incorporated under the Companies and Allied Matters Act, 2004. Also, that, contrary to paragraph 4.06 of the

Appellants brief of argument, Mr. Henry Olatujoye is not a party to the present action, neither is any relief sought for him or on his behalf.
The allusion to him, said counsel, is to give genesis of fact to the illegal takeover of the 1st Respondent by Ondo State Government.

Respondents counsel referred to and reproduced the provision of Section 251 (1) (e) of the Constitution of the Federal Republic of Nigeria 1999 (as amended) and submitted that from the provisions, it is very clear that the Federal High Court shall have exclusive power and exercise jurisdiction to the exclusion of any Court in civil cases relating to the management and control of companies incorporated in Nigeria under the companies and Allied Matters Act.

Learned counsel referred to the case of FBN V. Jimole Farms Ltd (1997) 5 NWLR (pt. 503) 81 and the Provision of Section 311 of the Companies and Allied Matters Act, 2004.
He then submitted that the 2nd, 3rd, 4th and 5th Respondents herein are not just members of the 1st Respondent as envisaged by the Provision of Section 311 of CAMA 2004 but are also directors and shareholders.

He submitted that the main crux of

this case is to stop Ondo State Government from its negative and over bearing intermeddling in the affairs of a Public Limited Liability Company which is against the overall interest of the members and shareholders of the company.
Also, that the Respondents made it clear in their petition that the removal from or appointment to the office of a General Manager/Managing Director by the 3rd Appellant is in flagrant disobedience to the earlier judgment of the Honourable Court in FHC/AK/CS/49/96, Ologunleko & Ors. V. Military Administrator Ondo State & Ors. to the effect that Ondo State Government and Attorney General of Ondo State do not have powers to remove or appoint a Director to the 1st Respondent because the 1st Respondent is Public Limited Liability Company.

Counsel submitted that the Appellants placed heavy reliance on Section 303 (1) of the Companies and Allied Matters Act (CAMA) that the leave of the Honourable Court was neither sought nor obtained by the Respondents before filing the suit. He argued that the Respondents action was commenced under Sections 299,301, 310, 311 (2) and 312 of the Companies and Allied Matters Act and as a

result, Section 303 (1) which the Appellants relied upon does not apply to the present action. He submitted that leave of Court is not needed by Board of Directors to institute an action against parties who have committed wrong against the 1st Respondent.
He stressed that 2nd, 3rd and 4th Respondents are the single largest shareholders having a total equity of 35% of the total shareholding of the 1st Respondent and as a result, it is not a case of a minority shareholders action.
He submitted that contrary to paragraph 2.04 of the Appellants brief, Engr. Henry Olatujoye was never at any time a nominee of Ondo State Government.

That the appointment of anybody to the office of a General Manager/Managing Director is a joint decision of the Board of the 1st Respondent.
In reply to paragraphs 4.11, 4.12 and 4.13 of the Appellants brief of argument, learned counsel to the Respondents submitted that the meeting of 9th March 2012 was an emergency meeting where 5 out of 9 Board members attended the meeting and such number formed a quorum.
Respondents counsel submitted and referred to the cases of Macdougall V. Gardiner (1875) 1 ch. D. 13 and

Brown V. La Trinidad (1887) ch. D. 1 at page 10 and submitted that the issue of emergency meetings and formation of quorum are matters which come within the “Irregularity principle” often expressed in terms of ratification where a mere informality or irregularity is alleged to invalidate a decision, a claim may not be brought questioning its validity if it is clear that on going through the correct procedure the decision would be ratified.
He argued that emergency meeting can be validly held as it was held to take a decision to save the company from the illegal takeover by the Appellants, who distanced themselves from the meeting to avoid taking the decision to save the company.

Learned counsel referred to article 101 of the memorandum and Articles of Association of the 1st Respondent and submitted further that there is no custom of the company which imposes a General Manager and Managing Director on the Company outside what is prescribed by Companies and Allied Matters Act and Memorandum and Articles of Association of the 1st Respondent. Therein, he said, the Managing Director should be a member of the Board and consequently, appointed the Managing

Director, Ondo State Government cannot impose a meeting of the company without Board of Directors.
The Respondents further submitted that the illegal occupation and activities of the 6th and 7th Appellants in the 1st Respondent is more than mere trespass but rather constitutes a criminal offence under Section 244 (3) of Companies and Allied Matters Act (CAMA) 2004.

That the illegal act of Ondo State can never be condoned or ratified by the Board of Directors who are vested with the management of the 1st Respondent under article 83/110 of the Memorandum and Articles of Association of the 1st Respondent.
After referring to the decision of the Supreme Court in the case of Osula V. Osula (1995) 2 NWLR (part 382) 128, learned counsel for the Respondents finally submitted that the appellants having disobeyed the earlier Court judgment as delivered in FHC/AK/CS/49/96, Olagunleko & Ors. V. Military Administrator Ondo State & Ors. (Supra) (pages 92 and 93 of the record), they are not entitled to be heard not to talk of seeking any relief from the Court until they have purged themselves of the contempt. The bail out of the 1st Respondent from

receivership by Ondo State Government should not be used as a guise or justification to intermeddle in the affairs of a public company by illegally taking over the 1st Respondent.

It seems to me that both counsel to this appeal have overstretched the defined limits of the sole issue nominated by the Appellants for determination in this appeal.
The Appellants approached this Honourable Court with three (3) perhaps four (4) grounds of appeal devoid of their particulars and numbered as follows at pages 225 – 227 of the record of appeal.
1. The learned trial judge erred in law when he held that the Federal High Court had jurisdiction to entertain the suit which did not arise from the operation of the Companies and Allied Matters Act Pursuant to Section 251 (1) (e) of the 1999 Constitution.
2. The Learned trial judge erred in law when he assumed jurisdiction on trespass matter which does not fall within the jurisdiction of the Federal High Court.
3. The lower Court erred in law by entertaining the Respondents suit which was instituted without compliance with the condition precedent as stipulated by the Article of Association of the Company

and the provision of the law.
4. The learned trial judge erred in law when he delved into the substantive matter at the interlocutory stage.

Meanwhile the learned counsel for the Appellants deemed it fit to formulate a sole issue perhaps only in terms of his grounds 1 and 2 as follows:
“Whether or not in view of the cause of action in the suit, the learned trial judge was right in holding that he had jurisdiction to entertain the suit pursuant to Section 251 (1) (e) of the 1999 Constitution“
The first thing to note from the Appellants issue as formulated above is the trite position of the law that arguments are to be canvassed on the basis of issues formulated and not on the grounds of appeal.

And, also that where no issue for determination is formulated from a particular ground of appeal, the ground of appeal is deemed abandoned and would be struck out.
See: Aja V. Okoro (1991) 7 NWLR (Pt. 203) 260
Adeyeri II V. Atanda (1995) 5 NWLR (Pt. 397) 512 at 518
Ogunsola V. Nicon (1996) 1 NWLR (Pt.423) 126.
Koya V. U. B. A. (1997) 1 NWLR (Pt. 481) 251 at 253.
Amadi V. N. N. P. C. (2000) 6 NWLR (Pt. 871) 16
A. N. P. P.

v. I. N. E. C. (2004) 7 NWLR (Pt. 971) 16.
Bhojsons Plc. V. Daniel – Kalio (2006) 5 NWLR (Pt. 973) 330.
Bayero V. Mainasara & Son Ltd. (2006) 8 NWLR (Pt. 982) 391.

In the instant case, the Appellants did not formulate any issue (s) on ground 3 and 4 of the Notice and grounds of appeal, the said grounds 3 and 4 are deemed abandoned and accordingly struck out.

Secondly, the only exercise that is required for a determination of the sole issue formulated by the Appellants is to examine the writ of summons and the statement of claim (petition) of the Appellants and see whether the claims and/or the reliefs are entertainable within the provision of Section 251 (1) (e) of the 1999 Constitution (as amended)

Meanwhile, the briefs exchanged by both counsel contained extraneous matters such as issues of non – compliance with condition precedent, locus standi and leave to institute action by minority shareholders.
With respect to both counsel all of these matters relate to and attract the consequences of incompetency of action and not necessarily the jurisdiction of the Court below.

In other words, both counsel did mix up the

concept of incompetency of action with that of jurisdiction of the Court. Obviously, the incompetency of action may lead to lack of jurisdiction of the Court but the two concepts are not synonymous.
The incompetency of an action does not create a primary issue of jurisdiction it could at best create a collateral issue of jurisdiction.

Put in another way, a distinction must be drawn between two types of jurisdictions namely: jurisdiction as a matter of procedural law and jurisdiction as a matter of substantive law. Whilst a litigant can waive the former, no litigant can confer jurisdiction on the Court where the Constitution or a statute or any provision of the common law says that the Court does not have jurisdiction. A litigant may submit to the procedural jurisdiction of the Court but not to the substantive jurisdiction.
See: Ndayako v. Dantoro (2004) 13 NWLR (Pt. 880) 187.

As I said earlier, in the instant case, the simple question to be attended to is whether the Court below had jurisdiction to entertain the claim of the Respondents by critically looking at the writ of summons and statement of claim (petition).
See: Gafar v. Govt.

Kwara State (2007) 4 NWLR (Pt. 1024) 375.
Onuorah V. K. R. P. C. (2005) 6 NWLR (Pt. 921) 393
Tukur v. Govt. of Gongola State (1999) 4 NWLR (Pt. 117) 517
Onyenucheya v. Military Administrator Imo State (1997) 1 NWLR (Pt.482) 429
Multi-purpose Ventures Ltd. v. A-G Rivers State (1997) 9 NWLR (Pt.522) 642.
Nkuma V. Odili (2006) 6 NWLR (Pt.977) 587
Lufthansa Air lines v. Odiese (2006) 7 NWLR (Pt.978) 39.

The totality of the claims and reliefs of the petitioners Respondents in the instant case not only disclosed declarations that the purported appointment of another General Manager and/or Managing Director for the 1st Respondent by the Ondo State Government contravenes the provisions of the companies and Allied Matters Act 2004, as well as the memorandum and Articles of Association of the 1st Respondent but also declarations that Ondo State Government is not a member and shareholder of the 1st Respondent and as such has no power to appoint Directors and interfere with the management and day to day running of the 1st Respondent.

It also amongst other things seeks an order for the purchase of the shares of the 2nd Appellant who

is a minority shareholder of the 1st Respondent by other members of the 1st Respondent and, an order directing the 6th and 7th Appellants to render a full account of all the affairs of the said 1st Respondent petitioner from the 6th day of March 2012 to the date of handover to the 1st Respondent as managed by them under their assumed role of managing director.

Clearly, and contrary to the suggestion of the learned counsel for the Appellants, the above are claims relating to the operation of companies and Allied Matters Act as contemplated by the Provision of Section 251 (1) (e) of the 1999 Constitution (as amended).
Section 251 (1) (e) of the 1999 Constitution reads thus:
“251 – (1) notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters-(e) arising from the operation of the companies and Allied Matters Act or any other enactment replacing that Act or regulating the operation of companies

incorporated under the companies and Allied Matters Act.”

Based on the above, the learned trial judge was right to have held at pages 218 – 219 of the record of appeal that the reliefs as contained in the petition are within the purview of Section 251 (1) (e) of the 1999 Constitution and that the suit has to do with the running and management of the 1st petitioner (1st Respondent)
The only issue in this appeal is resolved against the Appellant.
Consequently, the appeal lacks merit and it is accordingly, dismissed.
N30,000. 00 costs is awarded jointly and severally against the Appellants.

MOHAMMED AMBI-USI DANJUMA, J.C.A.: Having read the lead Judgment rendered by my learned brother, Mojeed A. Owoade, J. C. A., I am in no doubt that the appeal should fail. His view is in consonance with the law, to the effect that the learned trial Judge and his Court, – the Federal High Court of Nigeria, has the amplitude of jurisdiction under Section 251 (1) (e) of the Constitution of the Federal Republic of Nigeria, 1999, LFN, 2004 to take cognizance of and hear the petition filed before it. The petition related to the running

and Management of the 1st petitioner/1st Respondent (Company Incorporated under the companies and Allied Matters Act, (CAMA), 1990).
The Appeal against this view held by the trial Court, with which I also agree has no merit.
It must fail; and the trial Court’s view and Judgment is affirmed, in agreement with the leading Judgment herein before referred.

JAMES SHEHU ABIRIYI, J.C.A.: I read before now the draft of the judgment just delivered by my learned brother MOJEED ADEKUNLE OWOADE, JCA. I agree entirely with my learned brother that the claims before the lower Court relate to the operation of the Companies And Allied Matters Act and the Federal High Court has jurisdiction under S 251 (e) of the Constitution FRN 1999 to entertain the suit.
Therefore the appeal lacks merit.
I too dismiss the appeal.
I abide by the consequential orders made in the lead judgment especially the order as to costs.

Appearances:

F. K SALAMI D.D.P.P ONDO STATE M.O.J. For Appellant(s)

B. BADEJO For Respondent(s)

Appearances

F. K SALAMI D.D.P.P ONDO STATE M.O.J. For Appellant

AND

B. BADEJO For Respondent