STEPHEN OKPARA -VS- ARIK AIR LIMITED & ORS

IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA

IN THE ABUJA JUDICIAL DIVISION

HOLDEN AT ABUJA

BEFORE HIS LORDSHIP HONOURABLE JUSTICE K. D. DAMULAK

ON THE 16^TH DAY OF OCTOBER 2019

SUIT NO. NICN/ABJ/316/2018

BETWEEN:

STEPHEN OKPARA …………………………………. CLAIMANT

AND

1.ARIK AIR LIMITED .. ….……………….DEFENDANTS

2.OLUSEYE APASAYA S.A.N

(Sued in his capacity as the Receiver/Manager

of the 1^st defendant)

REPRESENTATIONS:

Nkechi R. Udoh Esq. with Hamza Victor Chukure Esq For the claimant

Dr. Ayodele Gatta Esq. with Lucky Harry Briggs Esq.

and Anita Oteh Esq. For the defendant.

JUDGMENT

1.0 INTRODUCTION

This judgment borders on the claim of the claimant that the sum of N3,420,000.00 of his contributory pension was not remitted to his pension administrator, Stanbic IBTC by the defendant.

The case was commenced via a complaint dated and filed on the 9^th of November 2018, together with a statement of claim, list of witnesses, witness statement on oath, list of documents to be relied upon and copies thereof.

The claimant seeks the following reliefs:

A Declaration of this Honorable Court that the Defendants have fraudulently breached Chapter 5 Paragraph 5.5 of the Defendants’ Employee’s Handbook by failing to contribute 7.5% of the Claimant’s total emolument into the Claimant’s Retirement Savings Account and also failing to remit the 7.5% deducted from the Claimant’s total emolument as the Claimant’s contribution into the Claimant’s Retirement Savings Account for 51 months.
A Declaration that the said breach of Chapter 5 paragraph 5.5 of the Defendant’s Employee’s Handbook amounts to a breach of contract of employment.
An Order of the Honorable Court compelling the defendants’ to jointly and severally pay the Claimant the total sum of (N3, 429,000.00) four million four hundred and twenty nine thousand naira only, being the contributory pension accrued to the Claimant for the 51 months but the defendant failed to contribute their part and also failed to remit the part contributed by the Claimant into the Claimant’s Retirement Savings.
An Order of the Honorable Court compelling the defendants to jointly and severally pay the claimant the sum of 10,000,000 (Ten million naira) only for the hardship, mental torture, frustration to which the defendant had subjected the claimant as a result of fraudulently refusing to contribute for 51 months and also deducting claimant’s part of contributory pension for 51 months and failing to remit same into the claimant’s Retirement savings Account.
An Order of this Honorable Court compelling the defendants to pay the claimant the sum of five million naira (N5,000,000.00) as punitive damages to deter the defendant from further defrauding any other person in the future by way of failing to remit deducted pension fund and also failing to contribute their own part of the contribution fund.
An Order the Honorable Court compelling the defendants to pay 7% interest on the sum of (N3,429.000.00) three million four hundred and twenty nine thousand naira at the prevailing Central Bank interest rate for savings account at the sum of N240,000 per annum from 1^st September 2014 until the debt is fully liquidated.
10% interest per annum on judgment sum from the date of judgment to the final liquidation of the debt.
The cost of this action.

In response, the defendants entered appearance and filed their statement of defence and other accompanying documents as required by the Rules of this Honorable Court on the 20^th of March, 2019.

2.0 FACTS OF THE CASE:

The claimant was employed by the 1^st defendant as a Deputy Ground Operations on the 8^th of August 2006. He was later promoted to GroundOperations and was confirmed on the 12^th of June 2007. After serving the 1^st defendant for 8 years, the claimant resigned his appointment in June 2014. Thereafter, the claimant went to his Pension Fund Administrator to claim his pension only to discover that the 1^st defendant did not make payment as agreed. Thus the present case to recover the outstanding pension contribution of 51 (fifty one) months.

3.0 CASE OF THE CLAIMANT:

The claimant testified as PW1 in line with the pleadings as follows:

I put an application for employment with the 1^stdefendant, I was offered an employment letter dated the 8^th of August 2006. My appointment was confirmed vide a letter dated the 12^th June 2007 alongside the Employee’s Handbook. After religiously and committedly serving the 1^st defendant for eight (8) years, I resigned my appointment through a resignation letter I wrote to the Management of the 1^st defendant sometime in June 2014 and the 1^st defendant formally wrote a reply/acceptance to the said letter to me on the 5^th March 2015 with effect from 1^st September 2014.

After my resignation, I was shocked when I went to my Pension Fund Administrators to mop up my pension and discovered that the 1^st defendant clearly breached paragraph 5.5 of the 1^st defendant’s employee’s handbook which made provision for both the 1^st defendant and me to engage in contributory pension scheme (which is requirement of the law) to contribute 7.5% of my monthly emoluments (basic housing and transport allowance)to be paid into a designated Retirement Saving Account which in my case was the Keystone Bank. I discovered the said fact from my account through check with my pension fund administrators which shows that while I was still working with the 1^st defendant, the 1^st defendant monthly deducted 7.5% from my monthly salary and failed to remit the said deductions into my Retirement Savings Fund for some months and also failed to contribute the 1^st defendant’s side of the 7.5% for those unremitted months into my Retirement Savings Account. These facts I discovered through non-reflection of those payment in my statement of account as my accounts only reflects those that were paid for.

Out of the 96 months which I worked for the 1^st defendant and I was paid, the 1^st defendant deducted 7.5% of my salary every month but only remitted for 45 months leaving off the remittance for the other 51 months and also failed to contribute their own 7.5% for those 51 months and the outstanding amount for the non-remitted pension as well as the amount that the 1^st defendant failed on their own side to contribute amounts to N3, 429,000.00 (three million four hundred and twenty nine thousand naira only).The sum total of the contribution on both sides as at 2009 from my statement of account was N54,000 (fifty four thousand naira) per month while it increased to N67,500 (sixty seven thousand five hundred naira). The breakdown are as follows;

Year	Months not paid	No.of Months	Rate	Total NGN
2009	December	1	54,000	54,000
2010	March-Dec.	10	67,500	675,000
2011	Jan. –Sept. Nov. –Dec.	11	67,500	742,500
2012	Jan. March.-Dec.	11	67,500	742,500
2013	March.-Dec.	10	67,500	675,000
2014	Jan.-Aug.	8	67,500	540,000
Total				3,429,000

I drew the attention of the 1^st defendant to these facts orally and also personally wrote a letter dated the 26^th of February, 2015 demanding the said payment but the 1^st defendant failed to pay me the said monies.

I employed the services of a solicitor by name C.S. Edwin Korea solicitors who further wrote a demand letter dated the 11^th April, 2016. When I did not hear from the 1^st defendant, I further briefed the chambers of Nkechi R. Udoh & Co. who wrote another demand letter dated the 3^rd February, 2017. Shortly after the delivery of the said letters, we got wind of the fact that the management of 1^st defendant has been taken over by the Asset Management Corporation of Nigeria (AMCON) and that the 2^nd defendant has been appointed the receivers/managers of the 1st defendant, consequent upon which I still instructed my counsel to write them which he did. Messrs Oluseye Opasanya (receiver/manager) replied my counsel with the defendant’s letter headed paper through a letter dated the 23^rd March, 2017 stating that the law guiding receivership shall take its course. It is over 18 months that the 1^st defendant went into receivership and the defendants have not said anything to us but overlooked the issue.

After my resignation in 2018, the Keystone Bank who were my bankers clarified through a letter dated the 27^th of February,2015 addressed to the defendant’s Human Resources Manager that I had no outstanding liability, indebtedness or financial commitment and in other words, the 7.5% of my emolument was duly deducted from my side before my payment was made. That the sum of N3,429,000.00 of his contributory pension was not remitted to his pension administrator, Stanbic IBTC. The act of depriving me of the pension contributions which were duly deducted from my salary as well as the failure of the 1^st defendant to contribute their own quota as stated in the 1^st defendant employees’ manual is fraudulent and also amounts to a breach of the contract of employment.

Under cross examination, PW1 testified that at the time I left, Arik Air was under the management of Managing Directors and deputies. The 2^nd defendant was not a member of the management of Arik Air at the time I left. I wrote my letter of complaint to Arik Air through the Human Resources Manager. The total of the contributory pension due to me is N3, 429,000.00. I do not depend solely on my retirement savings. I am presently employed.

The following documents tendered by the claimant were admitted in evidence and marked as follows:

Letter of confirmation of appointment- Exhibit SO1
Demand letter for remittance and payment of outstanding benefit written by Stephen Okpara -ExhibitSO2A,
Breakdown of unremitted pension contributions -Exhibits SO2B
letter of non-indebtedness from Keystone Bank,. -Exhibit SO2C
Demand letter written by Nkechi R. Udoh & Co. alongside the courier proof of delivery -Exhibits SO3A & SO3B
Letter of employment. -Exhibit SO4
Response to resignation. -Exhibit SO5
Letter from C.S. Edwin Solicitors. – Exhibit SO6
Letter dated 20/3/2017 from Nkechi R. Udoh & Co. with attached proof of delivery from EPS. -Exhibit SO7
Statement of account with Stanbic IBTC Pensions: -Exhibit SO8
Letter of 2^nd defendant to Nkechi R. Udoh & Co. -Exhibit SO9
Arik Employee handbook. – Exhibit SO10

CASE OF THE DEFENDANTS:

The Human Resources Manager of the 1^st defendant Adebowale Asaye, testified as DW1 that the claimant resigned his appointment under the erstwhile management of the 1^st defendant and prior to the takeover of the management of the 1^st defendant by the Asset Management Corporation of Nigeria (AMCON) and the consequent appointment of the 2^nd defendant as Receiver/Manager of the 1^st defendant. The defendants are not privy to the alleged non-remittance of the claimant’s contributory pension in to his Retirement Savings Account (RSA). The alleged failure to remit the alleged sum of money was done during the erstwhile management of the 1^st defendant. The claimant did draw the attention of the erstwhile management of the 1^st defendant to the demands for the payment of the contribution, a fact to which the defendants are not privy to. The purported letter and the contents therein, written by the chambers of Nkechi R. Udoh are not within the knowledge of the defendants, as same predate the takeover of the management of the affairs of the 1^st defendant by the Asset Management Company of Nigeria (AMCON) on the 9th day of February 2017 and the subsequent appointment of the 2^nd defendant as the Receiver/Manager of the affairs of the 1^st defendant. The debts owed by the erstwhile management of the 1^st defendant cannot be borne by the Receiver/Manager as same cannot be transferred upon the takeover of the operations of the 1st defendants by AMCON on the 9^th of February, 2017.The defendants acknowledge the receipt of the letter from Keystone Bank dated the 27^th day of February, 2015 stated therein but states that the said letter and its content are within the knowledge of the claimant as the defendants are not privy to same. The amount, N3, 429,000.00 stated therein which were not allegedly paid by the 1st defendant were issues that are within the management action of the erstwhile management of the 1^st defendant and not the 2^nd defendant as Receiver/Manager of the 1st defendant. The defendants are not responsible for the alleged deprivation of the claimant of his pension contributions and that the said contract of employment was issued by the erstwhile management of the 1^st defendant. The said Handbook was issued by the erstwhile management of the 1st defendant and that whatever infractions of same as alleged by the claimant is the handwork of 1st defendant.

Under cross-examination, DW1 testified that: I joined the defendant on the 1^st of December 2006, I was there before a receiver was appointed. I am aware of AMCON, it is the current management of the 1^st defendant. The 2^nd defendant was appointed by AMCON. I know that the claimant resigned his appointment with the former management because I am a staff of the 1^st defendant. The 2^nd defendant represents AMCON and his duty is to oversee the operations of the business.

The following exhibit was tendered and admitted:

The Deed of the 2^nd defendant Receiver/Manager- Exhibit NUAA1.

6.0 DEFENDANTS’ FINAL WRITTEN ADDRESS:

The learned counsel for the defendant submitted four issues for determination and argued them as follows:

Whether by the extant provisions of section 48(7) of the Asset Management Corporation of Nigeria (Amendment) Act 2015, the defendants are liable for the claims of the claimant:

Firstly, the learned counsel submits that section 48(7) of the Asset Management Corporation of Nigeria (AMCON) Act 2015, exculpates the defendants from the claims of the claimant. This is because all the claims arose during the erstwhile management of the 1^st defendant before it went into receivership. The subsection provides thus:

‘Subject to section 48(7) of this Act and on the publication of the notice referred to in section 48(4) thereof, all judgments, claims, debt enforcement procedures existing or being pursued before the publication of the notice shall stand automatically suspended and be unenforceable against the debtor company for the shorter period of one year from the date of the publication of the notice or the period that the receiver continues to manage the affairs of the debtor company.

Provided that claims relating to wages and other entitlements of existing staff of the Debtor Company or debtor entity and professional advisers shall not be so suspended.’

It is further submitted that by virtue of the provision of section 122 of the Evidence Act 2011, the Court is bound to take judicial notice of the above quoted section being an Act of Parliament passed by the Nigerian Legislature. Equally, it was contended that a literal interpretation should be given to the subsection as it is devoid of any ambiguity. See SARAKI V. FEDERAL REPUBLIC OF NIGERIA (2016) ALL FWLR (PT. 836) P. 395 AT 464 PARAS B-C.

Whether the claimant is entitled to exemplary damages from the defendants:

Counsel submits that the claim for exemplary damages should be discountenanced due to the argument mentioned above bordering on section 48(7) of the AMCON Act. Furthermore, it was posited that exemplary damages can only be claimed in suits arising from tortious acts. From the facts of the case at hand, the basis of the claims is premised on a breach of contract, as such, exemplary damages cannot be granted. See First Inland Bank v. Craft 2000 Ltd & 1 or (2013) All FWLR (Pt. 660) p. 1416 at 1429 paras D-G.

Whether the defendants is (sic) liable to pay the claim for the cost of litigation to the claimant:

Counsel posits that the cost of the suit sought by the claimant should be discountenanced because no proof has been tendered in support. See Guinness (Nig.) Plc. V. Nwoke(2000) 15 NWLR (Pt. 689) 132 at 150.

Whether Exhibit S08 (copy of the claimant’s Stanbic IBTC RSA statement of account is not liable to be rejected in view of the failure of the maker to comply with extant rules of evidence:

It is contended that Exhibit S08, claimant’s Stanbic IBTC Retirement Savings statement of account, being an electronically generated evidence did not comply with the requirements of computer generated evidence in section 84(4) of the Evidence Act 2011, as such it is inadmissible.

7.0 CLAIMANT’S FINAL WRITTEN ADDRESS:

Learned counsel for the claimant formulated two issues for determination and argued them as thus:

Whether from the totality of the evidence before the court, the claimant has proved that defendants are indebted to him:

Learned counsel submits that the claimant has proved the indebtedness of the defendants to the claimant of the sum of N3, 429,000.00. This is because Exhibit SO8 which gives a breakdown of the RSA of the claimant shows that nothing was remitted for the period claimed by the claimant in Exhibit SO2. Besides, this piece of evidence has not been controverted by the defendants and the position of the law is that unchallenged evidence is deemed accepted. See Folorunsho &Anor. V. Shaloub (1994) 3 NWLR Pt. 333 413@433 para. BH.

Moreover, the 2^nd defendant cannot exonerate himself from the acts of the 1^st defendant preceding the appointment of the former. The modus operandi of Receivership is that the appointee draws up a rehabilitation plan for the purpose of debt payment. See section 48(2) of the AMCON Act; sections 393 (1), (2) of CAMA. See also Brewtech Nigerian Ltd v. Akinnawo and Anor.2016LPECR-40094 CA.

Whether the claimant has proved his case to entitle him to all the reliefs he seeks against the defendants:

Counsel posits that claimant has proved his entitlement to reliefs 1 and 2 by establishing non-remittance of pension contribution via Exhibit S08 and the existence of such entitlement via Exhibit S010.

Counsel further argues that the claimant is entitled to relief 4 relating to general damages as the claimant has established the hardship and frustration he suffered as a result of the non-remittance of his pension contributions. This is demonstrable from the claimant’s various attempts to get in touch with the 1st defendant, which proved futile. Besides, this claim was not challenged by the defendants and the position of the law regarding this is that minimal proof is required in proving general damages. See Nigeria Agricultural and Co-operative Bank Ltd v. Peter Achagwa (2010) 11 NWLR 339 at 347. In addition, general damages can be granted even if not specifically pleaded. See Alhaji IsiyakuYakubu v. Impresit Bakolori Plc. & 6 Ors (2011) 6 NWLR Pt. 1244.

Equally, it is contended that the claimant is entitled to punitive damages of N5, 000, 000 in order to deter the 1^st defendant from such act in the future as there was intent to profit from its wrongdoing. See Zenith Bank Plc& 1 Or. v. Chief Denis Ekwereuwem & 1 Or (2012) 4 NWLR pt. (|1290) 207 at 219. Besides, the Pension Reform Act 2014 equally makes provision for punitive damages in section 100.

Counsel also submits that the claimant is entitled to 7% interest on the sum ofN3, 429,000.00 at the prevailing Central Bank rate for savings account at the sum of N240,000 per annum from September 1^st 2004 until the debt is fully liquidated. See International Offshore Corporation Construction Ltd v. S.I.N. Nig. Ltd. (2003) 16 NWLR pt. 845 57 . This should be granted as it has been held that claim on interest in a fiduciary relationship shall be as of right. See Ebvnifie v. Wayne NA Ltd (1989) NWLR Pt. 122 at 445.

It is equally submitted that the claimant also claims 10% post judgment sum which was unrefuted by the defendants. See Elija Adebiyi (trading under the name and style of Delock Association) & 7 Ors. v. National Institution of Public Information & 2 Ors or ELC 2013 2260 SC pg. 1. The claimant also claims for cost of the suit as he was left with no other option but to institute the present action due to the defendants’ complacence regarding amicable settlement. See Order 55 R. 1 of the NICN Civil Procedure Rules 2017.

It is further argued that the defendants failed to give the full import of section 48(7). The meaning of the section is that all judgment claims, debt enforcement procedure existing or being pursued before the publication shall be suspended for 1 year from the date of publication of the notice of their appointment or the period he continues to manage the affairs of the debtor company whichever is shorter. For this, the defendants can pay the debts of the claimant as it’s been over two years since the appointment.

Also, section 48(6) provides for debt priority ranking in repaying debts owed by the debtor-company by the Receiver/Manager. Section 494 (1)-(3) of the Companies and Allied Matters Act (CAMA) prioritized the payment as follows: taxes deductions under the Provident Act 1961 (presently Pension Reform Act), all wages and salaries to servant, holiday remuneration, rewards and compensations under Workman’s Act. The claimant’s case falls within the deductions under the Provident Reform Act 1961, and ought to be given urgent attention. Section 494 (4) provides that the foregoing debt shall rank equally among themselves and be paid in full unless the assets are insufficient to meet them in which case they will abate to equal proportion. As such, if the intent of section 48(7) was to suspend all claims and payment of debt as long as the Receiver/Manager manages the debtor company, then there would never have been section 48(6) of AMCON Act and section 494 of CAMA. It was further submitted that reliance was placed on the cases cited by the defendants on the interpretation of statute and the Court was urged to use same in interpreting section 48(7).

In response to the argument of the defendant that there cannot be punitive damages in contractual cases, it is submitted that the Pension Reform Act makes such provision.

It is equally argued that the position of the defendants that they are not liable to pay cost of litigation, citing the case of GUINNESS NIG. PLC V. NWOKA supra, does not hold water. This is because the cases cited are in respect of where the claim for cost of engaging the services of the counsel was turned down. The cost which the claimant is asking for is the cost of litigation.

Lastly, the argument of the defendants that Exhibit SO 8 should be rejected for non-compliance to the Evidence Act 2011 is also misconstrued. This is because the document in question has profound relevance to the case. Moreover, the defendants did not object to the document during trial.

8.0 DEFENDANTS’ REPLY:

It is the contention of the defendants’ counsel that the claimant misconstrued the import of the following phrase in section 48(7) of the AMCON (Amendment) Act 2015: ‘…for the shorter period of 1 year from the date of the publication of the notice.’ This led to the misguided conclusion of the section to mean that if a receiver runs the company for more than a year, then claims coming under that section will be suspended for the period of that year; and if it is for less than a year, the suspension applies for only that period. The second part of the provision was ignored which provides that ‘…or the period that the Receiver continues to manage the affairs of the debtor company.’

Equally, the purpose of receivership is provided in the preamble of the AMCON (Amendment) Act 2015 which provides that: ‘An Act to establish the Asset Management Corporation of Nigeria for the purpose of efficiently resolving the non-performing loan assets of banks in Nigeria, and for related matters.’ So also section 5(c) of the Act. In order to actualize these mandates, section 7(a) of the Act makes provision for the appointment of a Receiver/Manager. It is on the basis of this that the 2^nddefendant was appointed to settle the debts of the 1^st defendant, including that of the claimant which falls under ‘related matters’.

Counsel further submits that the purport of section 48(7) of the AMCON (Amendment) Act 2015 is to assist the Receiver in the efficient resolution of the debts. As such, the section does not cast an irrevocable duty on the 2^nd defendant to resolve the claims of the claimant ‘within the shorter period of one year from the date of the publication of the notice’, rather it gives the 2^nd defendant a discretion in the resolution of the said claim for either a shorter period of one year or the period that the receiver continues to manage the affairs of the debtor company.

In addition, counsel submits that by the provision of section 10 of the Interpretation Act-‘where an enactment confers a power or imposes a duty, the power may be exercised and the duty shall be performed from time to time as occasion requires’, the 2^nd defendant is under an obligation to exercise the powers conferred on him by section 48(7) of the AMCON (Amendment) Act from time to time as occasion requires. An interpretation of the phrase “from time to time as occasion requires” imports the regular exercise of discretion as permitted legally. Consequent thereto, counsel submits that the proper intent of the subsection is that the 2^nd defendant has the discretion to suspend claims either for a period of one year or through the period that the 2^nd defendant continues to manage the affairs of the 1^st defendant.

ISSUES FOR DETERMINATION:

The claimants distilled two issues for determination, to wit-

Whether from the totality of evidence before the court, the claimant has proved that the defendants are indebted to him.
Whether the claimant has proved his case to entitle him to all the reliefs he seeks against the defendants.

The defendants, on the other hand, have formulated four issues for determination, to wit:

Whether by the extant provision of section 48(7) of the Asset Management Corporation of Nigeria (Amendment) Act 2015 the defendants are liable for the claims of the claimant.
Whether the claimant is entitled to exemplary damages.
Whether the defendant is liable to pay the claimant for the cost of litigation.
Whether exhibit SO8 is not liable to be rejected.

The two issues distilled by claimant’s counsel is one and the same. The 1^st issues distilled by both counsel are, in the opinion of this court, bearing in mind the case of the parties, adequate to dispose of all disputes in this case. They are accordingly adopted as issues for determination as follows;

Whether from the totality of evidence before the court, the claimant has proved that the defendants are indebted to him.
Whether by the extant provision of section 48(7) of the Asset Management Corporation of Nigeria (Amendment) Act 2015 the defendants are liable for the claims of the claimant.

COURT DECISION

I have read the pleadings, the evidence, both oral and documentary, as well as the final written addresses of both counsel in this case and summarized same as above, the above summary and the fuller details I have read will bear in my mind in this judgment as it has done in determining the issues for determination.

Learned defendants’ counsel has contended that exhibit SO8 be expunged for on compliance with section 84 of the evidence Act. I have considered the pleadings of parties and the fact that the objection is merely based on procedure and not on authenticity of the document. I accordingly invoke section 12 of the National Industrial Court Act (NICA) 2006 and depart from section 84 of the Evidence Act. The document remains admitted as exhibit SO8.

Whether from the totality of evidence before the court, the claimant has proved that the defendants are indebted to him.

The case of the claimant, by way of further summary is;

The 1^st defendant breached paragraph 5.5 of the 1^st defendant’s employee’s handbook which made provision for both the 1^st defendant and me to engage in contributory pension scheme to contribute 7.5% of my monthly emoluments to be paid into a designated Retirement Saving Account which in my case was the Keystone Bank. I discovered this fact from my account thorough check with my pension fund administrators which shows that while I was still working with the 1^st defendant, the 1^st defendant monthly deducted 7.5% from my monthly salary and failed to remit the said deduction into my Retirement Savings Fund for some months and also failed to contribute the 1^st defendant’s side of the 7.5% for those unremitted months into my Retirement Savings Account. These facts I discovered through non-reflection of those payment in my statement of account as my accounts only reflects those that were paid for.

The case of the defendants is;

The defendants are not privy to the alleged non-remittance of the claimant’s contributory pension in to his Retirement Savings Account (RSA). The alleged failure to remit the alleged sum of money was done during the erstwhile management of the 1^st defendant.

The debts owed by the erstwhile management of the 1^st defendant cannot be borne by the Receiver/Manager as same cannot be transferred upon the takeover of the operations of the 1st defendants by AMCON on the 9^th of February, 2017.The defendants acknowledge the receipt of the letter from Keystone Bank dated the 27^th day of February, 2015 stated therein but states that the said letter and its content are within the knowledge of the claimant as the defendants are not privy to same. The amount, N3, 429,000.00 stated therein which were not allegedly paid by the 1st defendant were issues that are within the management action of the erstwhile management of the 1^st defendant and not the 2^nd defendant as Receiver/Manager of the 1st defendant. The defendants are not responsible for the alleged deprivation of the claimant of his pension contributions and that the said contract of employment was issued by the erstwhile management of the 1^st defendant. The said Handbook was issued by the erstwhile management of the 1st defendant and that whatever infractions of same as alleged by the claimant is the handwork of 1st defendant.

From the above defence, no convincing analyses is required to come to the conclusion that the fact of the indebtedness of the 1^st defendant to the claimant is not denied by the defendants, but the defence, especially on the part of the 2^nd defendant, is that of admission and avoidance.

Without prevarication, the Court finds that the claimant has established the fact of the indebtedness of the 1^st defendant to him by credible evidence.

Whether the 2^nd defendant is liable to be sued for that indebtedness is a question for the 2^nd issue which we shall turn to anon.

Whether by the extant provision of section 48(7) of the Asset Management Corporation of Nigeria (Amendment) Act 2015 the defendants are liable for the claims of the claimant.

The claimant contends that it is over 18 months that the 1^st defendant went into receivership and the defendants have not said anything to him but overlooked the issue.

The defence, supported by the oral evidence of the DW1 has already been reproduced in issue 1 above. Submitting on issue 2, learned defendants counsel argued that Section 48(7) of the Asset Management Corporation of Nigeria (AMCON) Act 2015, exculpates the defendants from the claims of the claimant. This, he contends, is because all the claims arose during the erstwhile management of the 1^st defendant before it went into receivership. That Section 48(7) of AMCON did not cast an irrevocable duty on the 2^nd defendant to resolve the claims of the claimant within the shorter period of one year from date of publication of the notice, rather;

“it gives the 2^nd defendant a discretion in resolution of the said claims for either a shorter period of one year or the period that the receiver continues to manage the affairs of the debtor company”.

The claimant counsel, on his part, interprets section 48(7) of AMCON as meaning;

“All Judgment, claims, debt enforcement procedure existing or being pursued before the publication shall be suspended for one year from the date of publication of the Notice of their appointment or the period he continues to manage the affairs of the debtor company whichever is shorter (less)”·

It appears then that the answer to the question whether or not the claimant can claim for a payment of his debt now depends on a proper interpretation of section 48(7) of the AMCON Act 2010 as amended in 2015. Section 6 of AMCON (Amendment) Act,2015 provides thus:

6.Section 48 of the principal Act is amended by inserting new subsection “3-9”-

……..

(7) Subject to subsection 48(9) of this Act and on the publication of the notice referred to in section 48(4) thereof, all judgments, claims, debt enforcement procedures existing or being pursued before the publication of the notice shall stand automatically suspended and be unenforceable against the debtor company for the shorter of a period of 1 year from the date of the publication of the notice or the period that the receiver continues to manage the affairs of the debtor company. (underlining supplied)

Provided that claims relating to wages and other entitlements of existing staff of the Debtor Company or debtor entity and professional advisers shall not be so suspended.’

By exhibit NUAA1, the deed of appointment, the 2^nd defendant was appointed as receiver/manager on the 9^th day of February, 2017. The 2^nd defendant is therefore no doubt an agent of AMCON and was acting on behalf of AMCON. See CANSCO DUBAI LLC V SEAWOLF OIL FIELD SEVICES LTD (2018) LPELR. CA

The present suit was filed on 9/11/2018, it is well more than 1 year after exhibit NUAA1. The portion that brings the divergent interpretation by both counsel is; “…shall stand automatically suspended and be unenforceable against the debtor company for the shorter of a period of 1 year from the date of the publication of the notice or the period that the receiver continues to manage the affairs of the debtor company”.(underlining supplied)

“for the shorter of” followed by two periods, namely;

a period of 1 year from the date of the publication of the notice
or the period that the receiver continues to manage the affairs of the debtor company

means for whichever of the two listed periods is shorter, it is for the shorter period between the two listed periods, ”for the shorter of” cannot be limited to the first listed period.

The claimant counsel is therefore on firm ground when he interpreted “…for the shorter of a period of 1 year from the date of the publication of the notice or the period that the receiver continues to manage the affairs of the debtor company” to mean that all judgment claims, debt enforcement procedure existing or being pursued before the publication shall be suspended for 1 year from the date of publication of the notice of their appointment or the period he continues to manage the affairs of the debtor company whichever is shorter.

A suspension for a period cannot be a perpetual or indefinite suspension or abatement as defendants would want to construe section 48(7) of AMCON Act, 2010 as amended in 2015.

The defendants have contended that the 2^nd defendant, (receiver/manager), is not privy to the alleged non-remittance of the claimant’s contributory pension in to his Retirement Savings Account (RSA). The alleged failure to remit the alleged sum of money was done during the erstwhile management of the 1^st defendant.

This contention amounts to a receiver/manager trying to abdicate his duties of managing the affairs of the company for the benefit of the debtor company and the general body of creditors of the debtor company as spelt out in section 48(5) of the AMCON Act, 2010 as amended, which includes payment of debts owed by the debtor company. Section 48 (6) of the AMCON Act 2010 as amended in 2015 provides as follows;

(6)A receiver managing the affairs of a debtor company or debtor entity under the provision of this section shall be deemed to be a fiduciary of the debtor company or debtor entity and all its creditors: and shall in paying off any debts owed by the debtor company or debtor entity strictly adhere to debt priority ranking prescribed under section 494 of the Companies and Allied Matters Act.

The said section 494 of CAMA provides thus;

1) In a winding up there shall be paid in priority to all other debts—

(a)

(b)

(d) all wages of any workman or labourer, whether payable for time or for piece work, in respect of services rendered to the company;

(e) all accrued holiday remuneration becoming payable to any clerk, servant, workman or labourer (or in the case of his death to any other person in his rights) on the termination of his employment before or by the effect of the winding up order or resolution;

The claim of the claimant herein is in respect of services rendered to the company before it went into receivership.

The 2^nd defendant is not in law a different entity from the debtor company, the 1^st defendant in this case, but the 2^nd defendant is a manager of the company and his duties of managing the 1^st defendant include the payment of debts owed by the 1^st defendant. I so find and hold.

The claimant is entitled to have the defendants remit his contributory pension fund to his pension administrator to enable him withdraws same when he attains fifty years of age n line with section 16 of the Pensions Reform Act 2014.

The claim for the sum of 10,000,000 (Ten million naira) only for the hardship, mental torture, frustration to which the defendant had subjected the claimant is weak and not supportable as the claimant has not shown that he is was 50 years or is now 50 years to enable him draw from his pension account in line with section 16 of the pensions Reform Act 2014 which provides as follows;

Withdrawal from retirement savings account

(1) Subject to section 16 (2) as from the commencement of this Act, no person shall be entitled to make any withdrawal from his retirement savings account, opened under section 11 of this Act, before attaining the age of 50 years.

The claim for the sum of 10,000,000 (Ten million naira) only for hardship, mental torture and frustration is refused.

The claim for N5,000,000.00 punitive damages is also baseless and is refused.

The claim for 7% pre- judgment interest has not been proved .The claimant has not shown whether is entitlement to pre-judgment interest is statutory or contractual. The claim is baseless and cannot be granted. See

ELIJAH ADEBIYI (TRADING UNDER THE STYLE OF DELOCK ASSOCIATION) & ORS v. NATIONAL INSTITUTE OF PUBLIC INFORMATION & ORS (2013) LPELR-22628(CA) where the court held;

The Appellants claimed for pre judgment and post judgment interest on the sum. The general rule at common law is that pre judgment interest is not payable on a debt or loan in the absence of express agreement or some course of dealing or custom to that effect. Thus, pre judgment interest will, be payable where there is an express agreement to that effect and such agreement may be inferred from a course of dealing between the parties or where an obligation to pay interest arises from the common practice or usage of a particular trade or business – Alfontrin Ltd Vs. Attorney General, Federation (1996) 9 NWLR (Pt 4750) 634, Diamond Bank Ltd Vs. Partnership Investment Co Ltd (2009) 18 NWLR (pt 1172) 67. Consequentially, a plaintiff, in order to succeed in a claim for pre judgment interest, must show how the entitlement to such interest arose, that is whether by law, by contract or agreement or he must plead facts showing that the claim is part of the loss or special damages which the defendant’s wrong imposed on him. It is not enough to merely say that the plaintiff is claiming interest. The basis of the claim of interest must be made manifest on the pleadings -Ekwunife Vs. Wayne (W.A.) Ltd (1989) 2 NWLR (pt 122) 422, Sani Abacha Foundation for Peace & Unity Vs. United Bank for Africa Plc (2010) 17 NWLR (pt 1221) 192. The Appellants did not show any basis for the claim for pre-judgment interest and the claim for pre-judgment interest must fail.

The claim for pre- judgment interest is refused.

COURT ORDER

On the whole and for the avoidance of doubt, the case of the claimant succeeds and the court hereby declared and orders as follows;

It is hereby declared that the 1^st Defendant has breached Chapter 5 Paragraph 5.5 of the Defendants’ Employee’s Handbook and contract of employment by failing to contribute 7.5% of the Claimant’s total emolument into the Claimant’s Retirement Savings Account and also failing to remit the 7.5% deducted from the Claimant’s total emolument as the Claimant’s contribution into the Claimant’s Retirement Savings Account for 51 months.
The defendants are hereby ordered to pay into the Claimants contributory pensions account with Stanbic IBTC Pensions the total sum of (N3, 429,000.00) three million four hundred and twenty nine thousand naira only, being the contributory pension accrued to the Claimant for the 51 months which the 1^st defendant failed to pay into the Claimant’s Retirement Savings account.
The defendants are ordered to pay cost of 200,000.00 to the claimant.
The defendants are hereby ordered to pay the judgment sum and cost within 30 days of this judgment failure upon which the judgment sum shall attract 10% interest per annum.

This is the judgment of the Court and it is entered accordingly.

…………………………………………….

HONOURABLE JUSTICE K.D.DAMULAK

JUDGE, NICN, ABUJA.

IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA

IN THE ABUJA JUDICIAL DIVISION

HOLDEN AT ABUJA

BEFORE HIS LORDSHIP HONOURABLE JUSTICE K. D. DAMULAK

ON THE 16^TH DAY OF OCTOBER 2019

SUIT NO. NICN/ABJ/316/2018

BETWEEN:

STEPHEN OKPARA …………………………………. CLAIMANT

AND

ARIK AIR LIMITED …………………..…………………….DEFENDANTS

OLUSEYE APASAYA S.A.N

(Sued in his capacity as the Receiver/Manager

of the 1^st defendant)

JUDGMENT ORDER

WHEREAS claimant took out a complaint on the 9^th of November, 2018 against the defendants seeking the following reliefs:

A Declaration of this Honorable Court that the Defendants have fraudulently breached Chapter 5 Paragraph 5.5 of the Defendants’ Employee’s Handbook by failing to contribute 7.5% of the Claimant’s total emolument into the Claimant’s Retirement Savings Account and also failing to remit the 7.5% deducted from the Claimant’s total emolument as the Claimant’s contribution into the Claimant’s Retirement Savings Account for 51 months.
A Declaration that the said breach of Chapter 5 paragraph 5.5 of the Defendant’s Employee’s Handbook amounts to a breach of contract of employment.
An Order of the Honorable Court compelling the defendants’ to jointly and severally pay the Claimant the total sum of (N3, 429,000.00) four million four hundred and twenty nine thousand naira only, being the contributory pension accrued to the Claimant for the 51 months but the defendant failed to contribute their part and also failed to remit the part contributed by the Claimant into the Claimant’s Retirement Savings.
An Order of the Honorable Court compelling the defendants to jointly and severally pay the claimant the sum of 10,000,000 (Ten million naira) only for the hardship, mental torture, frustration to which the defendant had subjected the claimant as a result of fraudulently refusing to contribute for 51 months and also deducting claimant’s part of contributory pension for 51 months and failing to remit same into the claimant’s Retirement savings Account.
An Order of this Honorable Court compelling the defendants to pay the claimant the sum of five million naira (N5,000,000.00) as punitive damages to deter the defendant from further defrauding any other person in the future by way of failing to remit deducted pension fund and also failing to contribute their own part of the contribution fund.
An Order the Honorable Court compelling the defendants to pay 7% interest on the sum of (N3,429.000.00) three million four hundred and twenty nine thousand naira at the prevailing Central Bank interest rate for savings account at the sum of N240,000 per annum from 1^st September 2014 until the debt is fully liquidated.
10% interest per annum on judgment sum from the date of judgment to the final liquidation of the debt.
The cost of this action.

AND after hearing the evidence of both parties and the address of Nkechi R. Udoh Esq. with Hamza Victor Chukure Esq for the claimant and Dr. Ayodele Gatta Esq. with Lucky Harry Briggs Esq and Anita Oteh Esq. for the defendants, it is held that the case of the claimant succeeds in part and it is hereby ordered as follows;

COURT ORDER

It is hereby declared that the 1^st Defendant has breached Chapter 5 Paragraph 5.5 of the Defendants’ Employee’s Handbook and contract of employment by failing to contribute 7.5% of the Claimant’s total emolument into the Claimant’s Retirement Savings Account and also failing to remit the 7.5% deducted from the Claimant’s total emolument as the Claimant’s contribution into the Claimant’s Retirement Savings Account for 51 months.
The defendants are hereby ordered to pay into the Claimants contributory pensions account with Stanbic IBTC Pensions the total sum of (N3, 429,000.00) three million four hundred and twenty nine thousand naira only, being the contributory pension accrued to the Claimant for the 51 months which the 1^st defendant failed to pay into the Claimant’s Retirement Savings account.
The defendants are ordered to pay cost of 200,000.00 to the claimant.
The defendants are hereby ordered to pay the judgment sum and cost within 30 days of this judgment failure upon which the judgment sum shall attract 10% interest per annum.

GIVEN UNDER THE SEAL OF THE COURT AND THE HAND

OF THE HONOURABLE JUDGE, HON. JUSTICE K. D. DAMULAK

THIS 16^TH DAY OF OCTOBER, 2019.

…………………………….

HON. JUSTICE K. D. DAMULAK

JUDGE