ZENITH BANK v. KANU & ANOR
(2020)LCN/15833(CA)
In The Court Of Appeal
(ABUJA JUDICIAL DIVISION)
On Wednesday, July 29, 2020
CA/A/194/2011
Before Our Lordships:
Abdu Aboki Justice of the Court of Appeal
Stephen Jonah Adah Justice of the Court of Appeal
Mohammed Baba IdrisJustice of the Court of Appeal
Between
ZENITH BANK PLC APPELANT(S)
And
1. H.R.H. EZE DR. SIR M. O. KANU 2. SECURITIES AND EXCHANGE COMMISSION RESPONDENT(S)
RATIO:
DUTY OF COURT NOT TO MISLEAD OR MISPLACE JUSTICE.
A Court is also entitled to look through its record to ascertain and/or confirm the position of things in order to ensure, that it is not misled and/or justice of the case is misplaced. See the cases of TEXACO PANAMA INCORPORATION VS. SHELL PETROLEUM DEVELOPMENT CORPORATION OF NIG. LTD (2002) 2 SCNJ 102 and INDEPENDENT NATIONAL ELECTORAL COMMISSION, ANAMBRA STATE & ANOR VS. OKONKWO (2008) LPELR-4315. MOHAMMED BABA IDRIS, J.C.A.
WHAT IS LOCUS STANDI?
Locus standi is a word that describes not only the jurisdiction of the Courts to entertain matters brought before them but may also restrict access to the Courts to persons who may think they have genuine grievances.
In the case of IJELU & ORS VS. LSDPC & ORS. (1992) LPELR-1464(SC), the Supreme Court per Mohammed, JSC reiterated thus:
“A Plaintiff will have locus standi in a matter only if he has a special legal right or alternatively if he has sufficient or special interest in the performance of the duty sought to be enforced or where his interest is adversely affected. See Ovie Whiskey v. Olawoyin (1985) 6 N.C.L.R. 156; Alhaji Agbonikhena and others v. Egba and others (1987) 2 NWLR (Pt. 57) 494; Aberuagba v. Attorney-General Ogun State (1984) 5 N.C.L.R 667. MOHAMMED BABA IDRIS, J.C.A.
WHEN A PARTY MUST BE JOINED AS A PARTY IN A SUIT
In Chief Ojukwu v. Governor of Lagos State (1985) 2 NWLR (Pt. 10) 806, this Court held that the test of interest to determine a party interested in a matter is whether the person could have been joined as party to the suit.” Per Karibi-Whyte, JSC (Pp. 42 – 43, Paras. F-B) ….”
He went further to state thus:
“One other test of sufficient interest is whether the party seeking for the redress of remedy will suffer some fundamental injury or hardship arising directly from the litigation. If the Court is satisfied that he will so suffer, then he must be heard as he is entitled to be heard. But the injury or hardship which must be real and tangible must be directly related to the litigation.” Per Karibi-Whyte, JSC (P. 43, Paras. C – E). MOHAMMED BABA IDRIS, J.C.A.
COURT RELIANCE SUBSTANCE OF THE MATTER AND NOT ON TECHNICALITIES
The attitude of the Courts nowadays is to do substantial justice without undue adherence to technicalities. Justice can only be done if the substance of the matter is examined. Reliance on technicalities leads to injustice. See the case of ADELUSOLA & ORS VS. AKINDE & ORS (2004) LPELR-120(SC). MOHAMMED BABA IDRIS, J.C.A.
WHETHER CONSIDERATION OF ALL DOCUMENTS PLACED BEFORE A COURT FOR ITS PERUSAL WILL AMOUNT TO CONSIDERATION OF EXTRANEOUS MATTERS
It is quite surprising as it is trite law that a Court of law in making its findings can look at all evidence available before it.
A consideration of documents placed before a Court for its perusal, cannot in my view amount to consideration of extraneous matters in arriving at a conclusion as argued by learned counsel for the Appellant. See the following cases AKINOLA VS. V.C. UNILORIN (2004) 11 NWLR (PT. 885) 616; BADEJO VS. FEDERAL MINISTRY OF EDUCATION (1996) 8 NWLR (PT. 464) 15. MOHAMMED BABA IDRIS, J.C.A.
WHEN A DECISION IS SAID TO BE PERVERSE
A decision is said to be perverse
(a) when it runs counter to the evidence;
(b) where it has been shown that the trial Court took into account matters which it ought not to have taken into account or shuts its eyes to the obvious;
(c) when it has occasioned a miscarriage of justice.
See the cases of MISR. VS. IBRAHIM (1975) 5 SC. 55; INCAR LTD VS. ADEGBOYE (1985) 2 NWLR (PT. 8) 453 and RAMONU ATOLAGBE VS. SHORUN (1985) 1 NWLR (PT. 2) 360. MOHAMMED BABA IDRIS, J.C.A.
MOHAMMED BABA IDRIS, J.C.A. (Delivering the Leading Judgment): By a petition dated 10th February, 2009 to the 2nd Respondent, the 1st Respondent complained against the Appellant for fraudulent inducement and manipulation, unprofessional conduct and breach of undertaking in connection with the Appellant’s initial public offer sometime in November, 2007.
The 2nd Respondent later invited parties to an ‘all parties meeting’ held on the 8th of April, 2009 and after hearing all the parties at the said meeting, informed parties that the matter will be referred to the management of the 2nd Respondent for final decision.
The said final decision was later communicated through letters dated 27th of May, 2009 and letter received on the 8th of June, 2009 by the 1st Respondent’s Counsel respectively. The letter dated 27th May, 2009 refused the request of the 1st Respondent made through his petition.
Unhappy with the decision of the 2nd Respondent, the 1st Respondent filed his Notice of appeal to the Investment and Securities Tribunal on the 28th of June, 2010. At the Tribunal, the parties filed and exchanged their respective briefs of Argument.
The Appellant at the Tribunal sought for the following reliefs:
1. A DECLARATION that the 2nd Respondent’s guarantee/Undertaking dated the 17/12/2007 is subsisting valid and enforceable against the 2nd Respondent.
2. A DECLARATION that the Appellant has the right to act and indeed, did act on the said guarantee/Undertaking in writing in cancelling his said N150 million fixed deposit at Diamond Bank Plc.
3. A DECLARATION that the 2nd Respondent is guilty of a fundamental breach of the said guarantee / Undertaking in Writing and of a later promise, understanding and oral agreement, resulting in a total failure of consideration.
4. A FURTHER DECLARATION that the 2nd Respondent’s fundamental breach, which resulted in total failure of consideration, entitles the appellant to RESTITUTION IN INTERGRUM.
5. A DECLARATION that the 2nd Respondent at the time it gave the said Guarantee/Undertaking in writing knew and or ought to know that the Guarantee/ Undertaking In Writing were absolutely false, dishonest, fraudulent, untrue and indeed, amounted to fraudulent misrepresentations.
6. A DECLARATION that the 2nd 2nd Respondent at the time it gave the said letter promise and or reached the said letter oral agreement or understanding, knew that they were absolutely false, dishonest, fraudulent, untrue and untenable, without a written permission from the 1st Respondent.
7. A DECLARATION that the 2nd Respondent at the time it made or caused to be made the said fraudulent representations both as per Guarantee/Undertaking and or the said later arrangement, promise, understanding and agreement, knew them to be absolutely false, dishonest, fraudulent, and untrue, or made them recklessly, not caring whether they were true or false.
8. A DECLARATION that the 2nd Respondent made or caused to be made, the In Writing and the said later arrangement, promise, understanding and agreement with the sole purpose of fraudulently luring and inducing the appellant to buy its said shares and part with his said N150 million.
9. A DECLARATION that the 2nd Respondent merely exerted undue influence, duress and coercion on the Appellant and indeed, took undue advantage of his old age (Over 77 years of age) as well as his limited education to perpetrate this fraud on the Appellant.
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10. A DECLARATION that the 2nd Respondent’s conduct in the share purchase matter is callous, criminal, willful deceit, unjust enrichment, despicable and reprehensible as it exposed the appellant to a huge, colossal, painful but avoidable losses:
i. Loss of huge income by way of 16% interest per annum by being lured, induced and indeed, coerced to revoke his high interest-yielding fixed deposit account with the Diamond Bank Plc for the past 17 months commencing December 17, 2007, and
ii. Loss of Dividend income, by having his fully-paid subscription of N150million arbitrarily split-up and credited to his four family members qua directors of OPMI, contrary to his original plan.
iii. Divulging and or exposing his concealed investment plan for his family by revealing the existence of this fixed deposit account with Diamond Bank Plc.
11. A DECLARATION that the 1st Respondent’s findings and Decisions are perversed, biased, prejudicial and a violation of the appellant’s right to fair hearing guaranteed under Section 36 of the constitution of the Federal Republic of Nigeria, 1999.
12. AN ORDER of this Tribunal, setting aside and the nullifying the said findings and Decisions of the 1st Respondent against the Appellant.
13. A MANDATORY ORDER of this Tribunal directing the 2nd Respondent to return the Appellant’s total net investment of N132,032,300.00 (One Hundred and Thirty-Two Million, Thirty-Seven Thousand, Three Hundred Naira) only, in the said share purchase, without any deductions at all; alternatively,
14. A MANDATORY ORDER of this Tribunal directing the 2nd Respondent to return the appellant’s total net investment of N132,032,300 (One Hundred and Thirty-Two Million, Thirty-Seven Thousand, Three Hundred Naira) only, in the said share purchase, after deducting any certified dividends so far paid and received by the Appellant’s various members qua directors of OPMI (if any).
15. A MANDATORY ORDER of this Tribunal directing the 2nd Respondent to pay to the Appellant the estimated 16% interest per annum on the said N150million fixed deposit at the Diamond Bank Plc, which the appellant cancelled consequent upon the said fraudulent misrepresentations and inducement, beginning from the date of the said cancellation and payment i.e. 15/12/2007 till judgment and thereafter at the rate of 10% till the full amount claimed in paragraph (14) is fully paid.
16. The SUM OF N150MILLION ONLY being the special and general damages against the 2nd Respondent for all the losses, injuries and damages suffered by the appellant as a result of the breach of both the written undertaking and guarantee and the oral promise and agreement by the 2nd Respondent, especially the promise by the 2nd Respondent, especially the promise by the 2nd Respondent that there would a one to one bonus share offer.
17. THE SUM OF N10MILLION ONLY, being the total costs, disbursements and counsel fees associated with this matter from inception till judgment.
18. AND FOR SUCH FURTHER OR OTHER ORDER(S) OR RELIEF(S) as the Honourable Tribunal may make in the peculiar but unfortunate circumstance of this Appeal.
At the hearing of the Appeal, the Appellant relied on the following documents marked Exhibits as follows:
a. EXHIBIT APP. I – Petition by the 1st Respondent to the Appellant complaining the fraud perpetrated on him by its staff/Representative-Caroline NosiriUkeka.
b. EXHIBIT APP. II – Petition by the 1st Respondent’s former legal practitioner- Prof. C. U Ilegbune, SAN, to the 2nd Respondent.
c. EXHIBIT APP. III – Letter acknowledging the receipt of (b) above by the 1st Respondent.
d. EXHIBIT APP. IV – Invitation to the Appellant to an All parties meeting by the 2nd Respondent.
e. EXHIBIT APP. V – Undertaking/Guarantee given by the Appellant to the 1st Respondent.
f. EXHIBIT APP. VI – Photocopy of the Diamond Bank cheque in favour of the Appellant.
g. EXHIBIT APP. VII – Share subscription/Mandate form of the Appellant for UcheKanu.
h. EXHIBIT APP. VIII – Share subscription /Mandate form of the 2nd Appellant for GeofferyKanu.
i. EXHIBIT APP. IX – Share subscription/ Mandate form of the Appellant for KanuChukwuemeka.
j. EXHIBIT APP. X – Share subscription/ Mandate form of the Appellant for KanuNnennaNonye.
k. EXHIBIT APP. XI – Share subscription/Mandate form of the Appellant for Eze Dr. Maxwell Kanu.
l. EXHIBIT APP. XII – Decisions and findings by the 2nd Respondents against the appellant.
m. EXHIBIT APP. XIII – Decisions and findings by the 2nd Respondent against the Appellant.
n. EXHIBIT APP. XIV – Notice of intention to refer the decisions and findings to the tribunal.
o. EXHIBIT APP. XV – Application for certified true copy of record of proceedings /Documents used by the parties before the 2nd Respondent, including the full reasons for the decision by the 2nd Respondent.
p. EXHIBIT APP. XVI – Documents sent by the 2nd Respondent, following the above application by the 1st Respondent.
q. EXHIBIT APP. XVII – Letter from Appellant crediting appellant with a refund of N9,085,476 refund, dated January, 13, 2009.
r. EXHIBIT APP. XVIII – The witness testimony on oath by Prince Daniel Kanu, together with the two annextures thereto.
s. EXHIBIT APP. XIX – The witness testimony on oath by one Mrs Gladys Ihetuge.
t. EXHIBIT APP. XX – The witness Testimony on oath by one Mr. Denis Benedict.
Before going into the appeal, here is a summary of the facts involved in this Appeal below.
The 1st Respondent who was the complainant claimed that the Appellant offered its shares for sale through an initial public offer sometime in 2007 and that the Appellant through one of its staff; Caroline Nosiri Ukeka persuaded the 1st Respondent to take advantage of the said offer which he was reluctant to take because he had no available funds except the sum of 150,000,000.00 ( One Hundred and Fifty Million Naira) placed in a 16% interest yielding deposit account at Diamond Bank PLC for him by his Son, Prince Daniel Kanu.
The 1st Respondent further claims that after much persuasion by the Appellant, he issued a Diamond Bank cheque of 150,000,000.00 (One Hundred and Fifty Million Naira) only, in favour of the Appellant with the undertaking that the 1st Respondent will get a full allotment of his shares worth N150,000,000.00 by the Appellant.
The 1st Respondent claimed that after the said issuance of the cheque and the undertaking for the allotment of the shares to the 1st Respondent, the Appellant did not issue any mandate application form to the 1st Respondent in respect of the full allotment as promised but rather the Appellant called the 1st Respondent to inform him that no one person or entity can be allotted shares worth N150,000,000.00 in a single application which information was hidden from the 1st Respondent.
The 1st Respondent claimed that he immediately sought for termination of the transaction or a refund of his money but the Appellant offered an alternative of splitting the application/ allotment into five between the 1st Respondent and four of his children with the promise that the shares would later be consolidated in the name of the 1st Respondent which development was never made know to his four children.
The 1st Respondent claimed that he was later compelled to pay an additional sum of N37,300 (Thirty-Seven thousand, Three Hundred Naira Only) which was different from the original amount agreed for the allotment of shares.
The 1st Respondent gave the breakdown of the share allotment as follows:
KANU UCHE – 770,000 units for N29,953,000
KANU GEOFFERY – 770,000 units for 29,953,000.00
KANU CHUKWUEMEKA – 770,000 units for N29,953,000
KANU NNENNA NONYE NWACHUKWU – 770,000 units for N29,953,000.00
KANU M.O. – 770,000 units for N30,225,300
TOTAL- N150,037,300.00
The 1st Respondent claimed that only 543,900 units of shares were allocated to him instead of 777,000 units thereby entitling the 1st Respondent to a refund of N9,067,590.00 which the Appellant failed to refund despite demands by the 1st Respondent.
The 1st Respondent further claimed that the Appellant refused to issue any share certificate to the 1st Respondent or his children in respect of the allotments and also failed to consolidate the five applications into one allotment.
The 1st Respondent claims that the 2nd Respondent convened an all parties meeting wherein the 2nd Respondent refused the 1st Respondent’s reliefs for refund and interests on the basis that the 1st Respondent had been allotted shares in consequence of the purchase transaction and has benefitted from payment of dividends on shares allotted.
Dissatisfied with the decision of the 2nd Respondent, the 1st Respondent filed an Appeal to the Investment and Securities Tribunal dated 27th May, 2009.
Subsequently, the tribunal in its Judgment of 7th June, 2010 set aside the decision of the 2nd Respondent made on the 18th of May, 2009 and gave judgment in favour of the 1st Respondent.
Dissatisfied with the Judgment of the tribunal, the Appellant filed a Notice of appeal on the 28th of June, 2010 comprising of Nine (9) grounds of appeal. Only the Appellant and the 1st Respondent as parties in the appeal before this Court filed and exchanged their respective briefs of argument.
In the Appellant’s Amended brief of argument as settled by his counsel Dr. Oladapo Olanipekun, SAN and dated 15th August, 2016, the following issues for determination were distilled from the grounds of appeal as follows:
1. Whether the claim/Appeal of the 1st Respondent before the lower tribunal was/is not improperly constituted and incompetent, thereby divesting the lower tribunal of the jurisdiction to entertain same. (Ground 11, 12 and 13).
2. Whether the lower tribunal did not breach the Appellant’s right to fair hearing and in so doing, acted without jurisdiction when it failed to consider and pronounce on the issue of the 1st Respondent’s lack of locus standi, duly raised by the Appellant. (Ground 4 and 14)
3. Having regard to the facts and circumstances of this case, particularly the state of evidence before the lower Tribunal, whether the lower tribunal was not in grave error in holding that the 1st Respondent made out a case of fraud and undue influence against the Appellant. (Ground 1,2,3,5,6,8)
4. Having regard to the 1st Respondent’s claim/Appeal before the lower tribunal vis-à-vis the facts and circumstances of the case, whether the judgment of the lower Tribunal did not amount to double/undue compensation for the 1st Respondent. (Ground 7, 9 and 10).
On Issue One, the Appellant’s Counsel argued that the 1st Respondent’s claim before the tribunal was not properly constituted and therefore incompetent. Therefore, the lower Court lacked the jurisdiction to entertain same. On this point, he cited the case of MADUKOLU VS. NKEMDILIM (1962) 1 ALL NLR 587 AT 595.
The Appellant’s Counsel argued that there were a number of factors that culminated into making the claim of the 1st Respondent improperly constituted thereby depriving the Tribunal of jurisdiction.
The Appellant’s Counsel argued that the proper parties were not before the Tribunal and further argued that the Tribunal misapprehended the nature of the Appellate proceedings before it as if same was instituted as a fresh action and that the decision of the 2nd Respondent constitutes a condition precedent to the exercise of jurisdiction by the tribunal and the said decision of the 2nd Respondent appealed against was absent. On this Point, counsel cited the case of ATOLAGBE VS. AWUNI (1997) 9 NWLR (PART 522) 536 AT 566 – 567.
The Appellant’s Counsel also argued that the 1st Respondent categorically stated in his Notice of Appeal before the tribunal that the decision it appealed against is that of May 27, 2009 and that the 2nd Respondent did not make any decision on May 27, 2009 and that the extract of the 2nd Respondent’s letter dated 3rd march, 2010 makes it clear. Also, the Appellant’s Counsel argued that the 1st Respondent laid his complaints before the lower tribunal from two different documents and that the law is trite that Grounds of Appeal as well as particulars must flow directly from the decision being appealed against. On this point he cited the case of JIM-JAJA VS. C.O.P. RIVERS STATE (2013) 6 NWLR (PART 1350) 225 AT 253.
The Appellant’s Counsel also argued that a cursory look at the proceedings before the 2nd Respondent will show that the parties were the 1st Respondent herein, One Caroline Ukeka, Zenith Registrars Limited and Zenith Capital Limited and that the Appellant was not heard but were mere attendees at the meeting. The Appellant’s Counsel also argued that the 2nd Respondent were not under any illusion as to who were the parties before it as only those who made submission before it was parties before the 2nd Respondent.
The Appellant’s Counsel argued that upon appeal to the Tribunal, the 1st Respondent made the Appellant herein a party thereby making the appeal at the Tribunal improperly constituted. The Counsel further argued that the Appellant has a distinct legal personality and on this point, counsel cited Section 37 of the Companies and Allied Matters Act and the CASE OF SALOMON VS. SALOMON & CO. (1897) AC 22.
The Appellant’s Counsel further argued that a party is not at liberty to present on appeal, a case different from that presented at the lower Court or tribunal. Neither can an Appellant introduce a new set of parties on appeal without the leave of Court first had and obtained.
Concluding on his argument on this issue, the Appellant’s Counsel argued that from his afore-stated argument, it is clear that the 1st Respondent’s appeal at the tribunal was incompetent and therefore the decision of the tribunal is a nullity.
On Issue Two, the Appellant’s Counsel argued that the Tribunal breached the Appellant’s Right to fair hearing when it failed to consider and resolve the fundamental issue of jurisdiction which was properly raised before it. On this point, counsel cited Section 36 of the Constitution of the Federal Republic of Nigeria, 1999 (As Amended).
The Appellant’s Counsel further argued that if the Tribunal had considered the issue of jurisdiction raised before it, it would have come to an inevitable conclusion that the 1st Respondent lacked the capacity to maintain the claim/appeal before it. Counsel also argued that the 1st Respondent lacked the locus standi to seek the reliefs which the Tribunal granted.
The Appellant’s Counsel also argued that from the aggregate of facts leading up to the 1st Respondent’s cause of action, the crux of the 1st Respondent’s complaint is that shares were not allotted to him as expected. He further argued that it is worthy of note that the four other applicants were allotted 770,000 units of shares valued at N29,953,000 (Twenty-Nine Million, Nine Hundred and Fifty-Three Thousand Naira), which was the quantum of units they applied for.
The Appellant’s Counsel further argued that the four Applicants are separate persons in law and it is the law that shares carry personal and individual rights. On this point, counsel cited the case of NEW RES INT’L LTD VS. ORANUSI (2011) 2 NWLR (PART 1230) 102 AT 127.Counsel also argued that assuming without conceding that any rights in the other shares have accrued, to the 1st Respondent, the 1st Respondent assumes the place of an assignee in law and that the law is that no action can be instituted competently by an assignee of a chose of action without joining the assignor either as Plaintiff or Defendant. On this point, Counsel cited the case of FERDINAND GEORGE VS. UBA LTD (1972) 8 – 9 SC 264 AT 279 – 280.
The Appellant’s Counsel also argued that the effect of the Tribunal’s decision is that it rescinded the share purchase agreement of a party who has no grievance with the Appellant and granted reliefs of refund and damages to a party who has no claim before it.
In conclusion of the argument on this issue, the Appellant Counsel argued that rights in property which is also guaranteed by Sections 43 and 44 of the Constitution cannot be divested without a proper hearing of parties with interest. On this point, he cited the case of A.G BENDEL STATE VS. AIDEYAN (1989) 4 NWLR (PT. 118) 646 AT 667.
On Issue Three, the Appellant’s Counsel argued that the Tribunal’s decision wherein it held the Appellant liable for fraud, misrepresentation and undue influence on the 1st Respondent is unmeritorious given the state of evidence before the Tribunal. Counsel further argued that the Tribunal considered extraneous matters to come to its conclusion.
The Appellant’s Counsel also argued that from the provisions of Section 82(1) of the Investment and securities Act, it is deducible that documents constituting the contract as it relates to this case is the prospectus issued by the Appellant and the share application form executed by the 1st Respondent. Counsel further argued that the 1st Respondent did not base his claim before the Tribunal on any of these documents but on extraneous private communication between himself and the Appellant’s staff.
The Appellant’s Counsel also argued that there is nowhere in the prospectus where any assurance of full issuance of shares applied for is made to the 1st Respondent. Therefore, the lower Court’s Reliance on a subsequent undertaking allegedly contained in the statement of the Appellant’s staff is wrongful.
The Appellant’s Counsel also argued that Exhibit APPV was illegal ab initio as it contravenes the Investment and Securities Act and the Appellant is not in any position to assure any subscriber of full subscription as allotment of shares is not within its powers. On this point, counsel referred this Court to Section 68 of the Securities and Exchange Commission Rules. Counsel further argued that there is no evidence of any formal advice given to the 1st Respondent by the Appellant and the 1st Respondent also failed to discharge the burden of proving that the Appellant communicated the option of splitting the shares to him and even if such information exists it cannot be attributed to the Appellant’s conjecture.
The Appellant’s Counsel argued that in the course of proceedings before the 2nd Respondent, the evidence was presented largely by oral testimony. However, the Tribunal took evidence mainly by documentary evidence and by so doing the Tribunal considered evidence which was totally at variance from the evidence on which the 2nd Respondent based its decision.
On Issue Four, the Appellant’s Counsel argued that the conduct of the 1st Respondent by accepting and retaining dividends paid to him on the shares for over one year cannot be said that the 1st Respondent took prompt action to set aside the transaction. On this point, counsel referred this Court to Page 575 of the Record of Appeal.
The Appellant’s Counsel argued that the 1st Respondent’s case is spurious and gold-digging. He further argued that there is no nexus between the claim of the 1st Respondent and the reliefs granted by the Tribunal. On this point counsel cited the case of ODOFIN VS. AGU (1992) 3 NWLR (PT.229) 350 AT 372.
The Appellant’s Counsel also argued that the share purchase transaction was concluded in 2007 and by virtue of Section 124 of the Evidence Act, this Court is to take judicial Notice of the crash in the Nigeria Capital that started in July, 2008 and the shares in issue which the 1st Respondent now purports to rescind in December, 2008 was allotted to him in 2007.
Conclusively, the Appellant’s Counsel argued that it is unconscionable to now allow the 1st Respondent who has taken advantage of the shares allotted to him to turn around to rescind the share purchase agreement. Counsel further argued that a Court of law would not allow a party benefit from his own wrong. On this point, counsel cited the case of TERIBA VS. ADEYEMO (2010) 13 NWLR (PT. 1211) 242 AT 263 – 264.
On the other hand, the 1st Respondent filed its brief of argument dated 28th December, 2018 and filed on 19th March, 2019 settled by its Counsel, Abhulimen Pauline Osobhase, Esq. and raised four(4) issues for determination. They are:
1. Whether having regards to the origin of this appeal, the 1st Respondent’s case before the lower Tribunal was properly constituted and competent? (Distilled from grounds 10, 11 and 12).
2. Whether the fundamental Rights of the Appellant were breached by the lower Tribunal before arriving at the decision the subject matter of this Appeal (Distilled from Grounds 4 and 11)
3. Having regards to the evidence both oral and documentary before the lower Court particularly Exhibit APP V (Undertaking by Caroline Ukeka) whether the lower Court was right in rescinding the share transaction on grounds of fraud and undue influence. (Distilled from Grounds 1, 2, 3, 5, 6 and 8).
4. Whether having regards to the peculiar circumstances of this case, the lower Tribunal was right to award general damages to 1st Respondent in the manner it did (Distilled from Ground 10).
In response to the argument of the Appellant’s Counsel in the Appellant’s brief of argument, the Respondent’s Counsel argued that the proceedings culminating into the decision of the Tribunal was duly and properly initiated.
The Respondent’s Counsel also argued that the argument of the Appellant’s Counsel that the Appellant was not part of the proceedings before the All Parties meeting held by the 2nd Respondent is totally misconceived as the petition of the 1st Respondent was against the Appellant as an entity and the said meeting cannot take place without both the Petitioner and the party petitioned against.
The 1st Respondent’s Counsel also argued that the Appellant was duly served with a copy of the petition and was invited to the all parties meeting set up by the 2nd Respondent and the Appellant was adequately represented and minutes of the said meeting clearly shows the participation of the Appellant at the meeting. The Respondent’s counsel cited the case of NIGER GATE VS. NIGER STATE GOVERNMENT (2005) 1 NWLR PART 907 PAGE 342 and urged this Court to look at its record to resolve this issue.
The 1st Respondent’s Counsel also argued that if the Appellant was not present at the meeting, the 2nd Respondent would not have conveyed its decision to the Appellant via its letter of 27th May, 2009 through its erstwhile solicitors.
The 1st Respondent’s Counsel also reproduced the minutes of the all parties meeting to buttress its argument and also to show that five representatives of the Appellant were present at the meeting.
The 1st Respondent’s Counsel also argued that the N150million changed hands from the 1st Respondent not to Caroline Ukeka in her personal capacity but to the Appellant who also enjoyed the benefit and value of the cheque.
The 1st Respondent’s Counsel further argued that the decisions communicated vide both letters referred to by the Appellant’s Counsel in paragraph 4.4 and 4.8 of the Appellant’s Brief are both one and the same. Counsel further argued that what the commission decided was conveyed to the parties but the reasons were yet to be conveyed and which circumstance does not prevent the 1st Respondent from filing its Notice of Appeal. The Respondent’s Counsel further argued that the law is well settled that the difficulty in securing the judgment of the Court bellow sought to be appealed against is not a barrier to filing a Notice of Appeal and Grounds of Appeal. On this point, counsel cited the case of IMPRESIT BAKOLORI PLC VS. ABDULAZEEZ (2003) 12 NWLR (PART 834) PAGE 307 AT 327 PARA H.
The 1st Respondent’s Counsel also argued that the Appellant was not at any time mistaken or misled as to the substance or the grouse of the 1st Respondent’s appeal to the Tribunal. Therefore, the Appellant’s argument is an afterthought structured to weep up technicalities into an otherwise clear appeal. On this point, counsel cited the case of NAGOGO VS. CPC (2013) 2 NWLR (PART 1339) PAGE 448 AT 492.
The 1st Respondent’s Counsel also argued that the issue of the constitution of the tribunal is a fresh issue raised by the Appellant before this Court which he cannot do except by leave of this Court to so raise. The 1st Respondent’s Counsel further urged this Court to strike out issue number one and resolve this issue in favour of the 1st Respondent.
On Issue Two, the 1st Respondent’s Counsel argued that the fundamental right of the Appellant was not breached in any way. He further argued that a party who has sufficient interest in the subject matter of litigation is endowed with the legal apparel of locus standi. On this point, counsel cited the case of CHIEF J.O. OLANIYAN VS. OBA G.O. ADENIYI (2007) 3 NWLR (PART 1020) PG 1
The 1st Respondent’s Counsel also argued that given the facts and circumstances of the extant case, the locus of the 1st Respondent is not in doubt as the transaction which gave rise to the suit was between the Appellant and the 1st Respondent, the promises and representation made by the Appellant’s representatives were directly to the 1st Respondent and no other person and the person who relied on the promises and representation, parted with his money to the Appellant was the 1st Respondent and the owner of the N150million Naira was the 1st Respondent.
The 1st Respondent further stated that none of these facts were controverted by the Appellant. Counsel also argued that no share certificate was ever issued by the Appellant in the name of the 1st Respondent’s four children and that the forms which were completed by the 1st Respondent at the advice of the Appellant on the firm undertaking by the Appellant that the shares listed therein shall be consolidated for the benefit of the 1st Respondent were all signed by the 1st Respondent to the knowledge of the Appellant.
The 1st Respondent’s Counsel also argued that it is only the 1st Respondent that would suffer fundamental injury which has clothe him with the locus standi to maintain action without authorization from any of his children whom the Appellant has brought into the picture for its own interest of retaining the N150Million Naira paid by the 1st Respondent. Counsel further argued that the suit does not fall within the class of a representative action since the injury suffered or sought to be addressed is that which the 1st Respondent suffers alone, his money obtained by misrepresented facts and allocated to his four (4) children.
The 1st Respondent argued that the Tribunal was right in holding as it did that the 1st Respondent was lured into subscribing to the Appellant’s IPO of November 7, 2007 thus entitling him to rescind the contract even after taking dividends. Counsel further argued that the said dividends were paid after the 1st Respondent had filed its petition before the 2nd Respondent.
The 1st Respondent also argued that the wordings of the undertaking refers to the 1st Respondent and not five persons in whose names forms were filled and signed and there is also an uncontroverted evidence that the total sum of N150,037,700 was eventually paid for the shares and was paid by the 1st Respondent and not by each or any of the other four persons.
On Issue Three, the 1st Respondent’s Counsel argued that that the Appellant’s Counsel argument in paragraph 4.28 and 4.29 of the Appellant’s Brief of Argument were misconceived and tailored to down play the role of Exhibit APP V in the release of the funds by the 1st Respondent and that Caroline Ukeka was not and could not have acted in her own capacity but in the ordinary course as staff of the Appellant.
The 1st Respondent’s Counsel also argued that that by virtue of Section 315 of the Investment and Securities Act, any written information, notice or advertisement qualifies as prospectus. Therefore, Exhibit APP V qualifies as one contrary to the argument by the Appellant seeking for anything tenable and untenable to hold unto in order to continue to enjoy the benefit of a failed contract it entered into while denying its liabilities. On this point, counsel cited the case of AKIN ADEJUMO & 2 ORS VS. AJANI YUSUF AYANTEGBE (1989) 3 NWLR PART 110 ORS (1989) LPELR – SC 204.
The 1st Respondent’s Counsel also argued that by the combine effects of Sections 108 and 110 of the Investment and Securities Act, 2007 and Rules 2(1) and (2) of the IST (Procedure) Rules, 2003, the Tribunal has power to place reliance on relevant documents before it and arrive at a decision it deems just.
The 1st Respondent’s Counsel also argued that assuming but not conceding that the Exhibit APP V was tainted with illegality, it is the settled principle of law that nobody or party should be allowed to take advantage of his own illegality. Counsel further argued that the Appellant who described itself to be a sound capital operator who knows and indeed ought to know that it had no right guaranteeing full allotment as it did but willingly made the said offer to the 1st Respondent who was neither aware or privy to any of the said facts or applicable rules and regulation.
The 1st Respondent Counsel also argued that it is clear from the testimony of the 1st Respondent at pages 47 – 61 of the Records of Appeal, Vol.1 that the idea of splitting the shares came from the Appellant and the fact was not impeached at the tribunal and even at the fact finding level of the All parties meeting.
On Issue Four, the learned Counsel to the 1st Respondent argued that award of damages is intended to compensate financial loss, both present and future, suffered by the complainant. On this point, counsel cited the case of CHIEF S.I. AGU VS. GENERAL OIL LIMITED (2015) LPELR-24613 (SC) PP 31 – 32, PARA G – B. Counsel further argued that in making award of damages, it is relevant to bear in mind galloping inflation and consistent depreciation of the value of the Naira.
The 1st Respondent’s Counsel argued that in this case, not only did the Appellant renege of its promises but also caused and still causing the 1st Respondent to lose his 16% interest on the 150million Naira fixed deposit it had with Diamond Bank Plc and in seeking redress, the 1st Respondent has expended Millions of Naira of approximately N10 Million Naira minus funds expended to defend this appeal. The 1st Respondent’s Counsel further argued that the Appellant is still trading with the 1st Respondent’s hard earned money and making profit thereon. On this point, Counsel referred the Court to the English case of ROOKIES VS. BERNARD 164 A.C 1129.
In Conclusion, the 1st Respondent’s Counsel urged this Court to dismiss this appeal and affirm the judgment of the Tribunal.
The Appellant’s Counsel also filed a response to the 1st Respondent’s Brief of Argument. The Appellant’s Reply Brief was dated 25th of March, 2020 and filed on the 1st of June, 2020 settled by its Counsel Akintola Makinde, Esq.
In Response to Issue One of the 1st Respondent’s Brief of Argument, the Appellant’s Counsel argued that the petition as well as the all parties meeting was geared at Zenith Bank International Plc and not the Appellant as the Appellant is Zenith Bank Plc which is a separate a distinct legal entity from Zenith Bank International Plc. He further argued that Caroline Ukeka had stated at the all parties meeting, that she did not inform her superiors about the undertaking before she signed same. On this point, he referred this Court to page 15 of the record of appeal.
The Appellant’s Counsel also argued that the issue of fair hearing is an issue of jurisdiction which can be raised at any time. Counsel further argued that the 1st Respondent did not make any attempt to impeach the submission of the Appellant that the originating process at the Tribunal did not contain the decision of the proceeding by the 2nd Respondent and as such amounts to an admission and there was no decision which the tribunal could set aside.
In response to the 1st Respondent’s argument on issue Two, the Appellant’s Counsel argued that locus standi as a concept is jurisdictionally flavored. On this point, he cited the case of ADESANYA VS. PRESIDENT 1981 12 N.S.C.C. 146
The Appellant’s Counsel further in response to the 1st Respondent’s Counsel in paragraph 4.44 of the 1st Respondent’s Brief of Argument argued that the Appellant was not a party at the All Parties Meeting and could not have raised any issue.
In response to the argument by the 1st Respondent’s Counsel on issue three, the Appellant’s Counsel has argued that the arguments contained in paragraphs 4.47 – 4.48 of the 1st Respondent’s Brief of Argument do not relate to the issue crafted by the 1st Respondent and in other words, the 1st Respondent framed an issue for determination and abandoned it.
The Appellant’s Counsel also argued that Exhibit APP V does not hold out as having been given on behalf of the Appellant neither does it portend to have been given with prior approval by the Appellant.
In response to the argument of the 1st Respondent’s Counsel on Issue four, the Appellant’s Counsel argued and drew the attention of this Court to Paragraph 4.81 – 4.92 of the 1st Respondent’s Brief of Argument that no credible submission was presented by the 1st Respondent in denial of the argument by the Appellant’s argument on issue four of the Appellant’s brief of Argument.
The Appellant’s Counsel also argued that the 1st Respondent’s Counsel has succeeded in contradicting himself in his argument in paragraph 4.88 of the 1st Respondent’s Brief of Argument. On this point, counsel cited the case of UDE VS. NWARA (1993) 2 NWLR (PT.278) 638 AT 662.
In conclusion, the Appellant’s Counsel submitted that the 1st Respondent has left this Court with no other option than to allow the appeal.
Having summarized the arguments of counsel, I wish to adopt the issues raised by the Appellant herein, and will address the same thereon.
1. Whether the claim/appeal of the 1st Respondent before the lower Tribunal was/is not improperly constituted and incompetent, thereby divesting the lower Tribunal of the jurisdiction to entertain same.
2. Whether the lower Tribunal did not breach the Appellant’s right to fair hearing and in so doing, acted without jurisdiction when it failed to consider and pronounce on the issue of the 1st Respondent’s lack of locus standi, duly raised by the Appellant.
3. Having regard to the facts and circumstances of this case, particularly the state of evidence before the lower Tribunal, whether the lower tribunal was not in grave error in holding that the 1st Respondent made out a case of fraud and undue influence against the Appellant.
4. Having regard to the 1st Respondent’s claim/appeal before the lower Tribunal vis-à-vis the facts and circumstances of the case, whether the judgment of the lower Tribunal did not amount to double/undue compensation for the 1st Respondent.
ISSUE ONE
Whether the claim/appeal of the 1st Respondent before the lower Tribunal was/is not improperly constituted and incompetent, thereby divesting the lower tribunal of the jurisdiction to entertain same. Under this issue the summary of the argument of the Appellant is that the 1st Respondent’s claim at the Investment and Securities Tribunal was not properly constituted. Firstly, as to the parties before it and secondly as to the absence of the decision appealed against.
Addressing the first point, the Appellant’s Counsel has argued in paragraphs 4.1 and 4.8 – 4.16 of his brief of Argument that the Tribunal was not properly constituted and that the proper parties were not before the tribunal.
Being that the cause of action arose as a result of an alleged wrong done to the 1st Respondent by the Appellant for which the 1st Respondent petitioned the 2nd Respondent by a letter dated 10th February, 2009(EXHIBIT APP. II), it is clear that the parties before the Securities and Exchange Commission would be the Petitioner (HRH Eze (Dr) Sir M.O. Kanu who is now the 1st Respondent before this Court)and Zenith Bank Plc (the Appellant)against whom the petition was written to the Securities and Exchange Commission(the 2nd Respondent).
The 2nd Respondent further invited the 1s t Respondent for an “All Parties Meeting” via a letter dated March 25, 2009 (Exhibit APP. IV). Consequently, the parties appeared for the all Parties meeting and I can clearly see from the minutes of the said meeting at page 84, 169 and 209 of the Record of Appeal Volume 1, held on Wednesday, April 8, 2009 that both the 1st Respondent and the Appellant were present at the meeting.
Looking at the first page of the minutes of the said meeting, it is clear that Eze Dr. Maxwell O. Kanu (the 1st Respondent) was present at the meeting as the Complainant and Caroline Ukeka (who is one and same person referred to as Caroline Nosiri), Kehinde Aberuagba (From the decision of the 2nd Respondent on Paragraph 1, page 163 of the Record of Appeal, Volume One, it is clear that he is the Deputy General Manager of the Appellant), Nnenna Oshagbemi, Charles Omere and Awe lee were also present at the meeting representing Zenith Bank Plc (The Appellant) whom the petition was written against.
Going further, the said Caroline who is a staff of the Appellant and who represented the Appellant made comment at the said meeting which was her response to the complaint of the Petitioner. See page 86 of the Record of Appeal, Volume 1.
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The above examination did not only go to show that the Appellant was at the all parties meeting set up by the 2nd Respondent but fully participated in the said meeting.
The Court can draw conclusion from the evidence before it and in this case, the Exhibits APP.II, APP. IV and the minutes of the ‘All Parties Meeting’. A Court is also entitled to look through its record to ascertain and/or confirm the position of things in order to ensure, that it is not misled and/or justice of the case is misplaced. See the cases of TEXACO PANAMA INCORPORATION VS. SHELL PETROLEUM DEVELOPMENT CORPORATION OF NIG. LTD (2002) 2 SCNJ 102 and INDEPENDENT NATIONAL ELECTORAL COMMISSION, ANAMBRA STATE & ANOR VS. OKONKWO (2008) LPELR-4315.
From the examinations already made above and my findings, the parties before the Investment and Securities Tribunal where the decision of the 2nd Respondent was appealed against were the proper parties as they are same parties who attended and participated at the ‘All Parties Meeting’ set up by the 2nd Respondent.
Be that as it may, it is clear that the tribunal had the jurisdiction to hear the appeal that was before it as the subject matter was not only proper before it but the parties before it as well. It is my strong and unshaken view and I so hold that the proper parties were both before the 2nd Respondent and the Tribunal and also participated in the proceedings before it. This point is hereby resolved against the Appellant in favour of the 1st Respondent.
On the Second point, the Appellant’s Counsel argued in paragraphs 4.3 – 4.7 of the Appellant Brief of Argument that the decision by the 2nd Respondent appealed against at the Tribunal was absent.
Looking at page 89 of the Record of Appeal, Volume 1, I reproduce the last paragraph of the said page as follows:
“In conclusion, the chairman thanked all who attended the meeting and again apologized for commencing the meeting behind schedule. He informed the parties that the matter will be referred to Commission’s Management for Final decision which will be communicated to them.”
Firstly, the above reproduced statement clearly shows that the decision of the ‘All Parties Meeting’ would be communicated to the parties. Now, from further examination of the Record of Appeal and the evidence before this Court, the said decision of the 2nd Respondent was communicated twice to the parties through a letter by the 2nd Respondent (Exhibit APP. XII) received on behalf of the 1st Respondent by his counsel on the 8th of June, 2009.
For want of emphasis, I would reproduce the content of the said letter from the 2nd Paragraph as follows:
“The Commission has investigated the above petition and accorded parties concerned a hearing.
After an evaluation of the facts and circumstances in the matter, the commission decided as follows:-
1. That it is not convinced that the Deputy General Manager of Zenith Bank Plc, Mr. Kehinde Aberuagba was not aware of the share transaction between Eze (Dr) Maxwell Kanu and Caroline Ukeka (an officer of Zenith Bank Plc).
2. That the transaction in issue was conducted by Caroline Ukeka on behalf of Zenith Bank Plc in an Unethical manner.
3. That Zenith Bank Plc is hereby warned to cease and desist from offering any form of guarantee of allotment to subscribers directly or otherwise.
4. Zenith Bank Plc is hereby directed to ensure that its officer (Caroline Ukeka) should not be assigned any capital role for a period of one year from the date of this letter…”
AND by a letter dated May 27, 2009 (Exhibit APP. XIII) wish I would also reproduce the second paragraph as follows:
“Please find attached a copy of the commission’s letter to Zenith Bank Plc communicating the commission’s decision in this matter. After a thorough evaluation of all issues and circumstances in this matter, the commission’s position is that your client’s request should be and is hereby declined.”
The above reproduced wordings from the said letters clearly shows that a decision was being communicated by the 2nd Respondent again but from the wordings reproduced from this 2nd letter, it shows a conclusion of the decision of the 2nd Respondent but how they arrived at the said conclusion is in doubt.
Looking Further and from pages 90 – 91 of the Record of Appeal, Volume 1, the issues for deliberation was submitted to the management of the 2nd Respondent for deliberation and decision and they arrived at a decision and conclusion without the reason for such decision? This made me curious and I looked further in the Records of Appeal before this Court to discover that the reasons for the decision of the Tribunal was never given to the 1st Respondent upon his application for same by virtue of Exhibit APP. XV which fact the 1st Respondent deposed to in his testimony before the Tribunal in paragraphs 53, 54, and 55 of his witness testimony and contained at page 60 of the Record of Appeal, Volume 1.
It would also be worthy to note hereunder that the extract of minutes contained in Pages 483 – 485 of the Record of Appeal, Volume 2 also forms part of the decision of the 2nd Respondent and also looking at the Exhibit APP. XII, it is clear that it embodies a summary of what is contained in the extract of minutes of the Executive Management Committee Meeting held on May 18, 2009 which was further communicated to the 1st Respondent via Exhibits APP. XII and APP. XIII which in my opinion conveys just one decision of the 2nd Respondent made on May 18, 2009. It is therefore, no fault of the 1st Respondent that the 2nd Respondent decided to convey its decision in two separate documents. It is trite that the Court has the duty to look at its records.
From the above examination of the various pieces of evidence before this Court, would it be fair and/or just to denial the 1st Respondent an appeal of a decision which he finds conflicting at the Tribunal simply because he was unable to obtain the reasons for the said decision which was no fault of his or because the 2nd Respondent decided to convey its decision in two separate documents without giving reasons and also refusing/or neglecting to give the said reasons to the 1st Respondent when he applied for same? I think not.
In my opinion, I think Exhibits APP. XII and APP. XIII stems from the decision of the Executive Management Committee meeting of the 2nd Respondent held on the 18th of May, 2009 and they are one and the same decision even though conveyed separately which is also in this case sufficient to initiate an appeal at the Tribunal and I so hold. It is therefore my strong view that the Tribunal had the jurisdiction to entertain the appeal before it. This point is hereby resolved in favour of the 1st Respondent.
ISSUE TWO
Whether the lower tribunal did not breach the Appellant’s right to fair hearing and in so doing, acted without jurisdiction when it failed to consider and pronounce on the issue of the 1st Respondent’s lack of locus standi, duly raised by the Appellant.
Before delving further into the determination of this issue, it would be important at this stage to look at the meaning of ‘locus standi’ and also apply it to this instant case.
Locus standi is a word that describes not only the jurisdiction of the Courts to entertain matters brought before them but may also restrict access to the Courts to persons who may think they have genuine grievances.
In the case of IJELU & ORS VS. LSDPC & ORS. (1992) LPELR-1464(SC), the Supreme Court per Mohammed, JSC reiterated thus:
“A Plaintiff will have locus standi in a matter only if he has a special legal right or alternatively if he has sufficient or special interest in the performance of the duty sought to be enforced or where his interest is adversely affected. See Ovie Whiskey v. Olawoyin (1985) 6 N.C.L.R. 156; Alhaji Agbonikhena and others v. Egba and others (1987) 2 NWLR (Pt. 57) 494; Aberuagba v. Attorney-General Ogun State (1984) 5 N.C.L.R 667.
In Chief Ojukwu v. Governor of Lagos State (1985) 2 NWLR (Pt. 10) 806, this Court held that the test of interest to determine a party interested in a matter is whether the person could have been joined as party to the suit.” Per Karibi-Whyte, JSC (Pp. 42 – 43, Paras. F-B) ….”
He went further to state thus:
“One other test of sufficient interest is whether the party seeking for the redress of remedy will suffer some fundamental injury or hardship arising directly from the litigation. If the Court is satisfied that he will so suffer, then he must be heard as he is entitled to be heard. But the injury or hardship which must be real and tangible must be directly related to the litigation.” Per Karibi-Whyte, JSC (P. 43, Paras. C – E) (emphasis mine)
From the above definition and legal authority on the term ‘locus standi’, it is clear that the Claimant in an action must have sufficient interest in the subject matter that leads up to litigation and would also be greatly affected by the outcome of the said litigation.
Coming back to the case at hand, the main crust of the petition that was filed by the 1st Respondent is that he was persuaded by the Appellant through one of its staff, one Caroline Nosiri Ukeka to buy shares worth N150 Million with an undertaking to allot full shares of that worth to the 1st Respondent which the Appellant failed to keep to the promise but splitted the shares into five allotments with a further promise that it would be consolidated. See page 65 – 69 of the Record of Appeal, Volume 1 for the petition by the 1st Respondent.
This instant case deals with a misrepresentation made by the Appellant for the eventual consolidation of the 1st Respondent’s shares which were allotted to four other allottees. The 1st Respondent also signed the dividend payment forms for the allotees except one.
Also, there was no time in the transaction or the action in Court where the Appellant denied knowledge of the transaction as between it and the 1st Respondent (not any other allottees). Therefore, arguing as the Appellant’s Counsel had done in the Appellant’s brief of argument especially at paragraph 4.22 that the five allotees of the shares are separate persons in law referring this Court to the case of NEW RES INT’L LTD VS. ORANUSI (2011) 2 NWLR (PT. 1230) 102 AT 127 and that the shares cannot be transferred through blood ties is surprising to say the least.
The Appellant’s Counsel has failed to understand that this case is totally different from one where the context is about right to shares by shareholders. This is a case where a man comes to complain that he has been cheated of his investment and money.
The argument of the Appellant’s counsel is purely technical and cannot be allowed to thrive. The attitude of the Courts nowadays is to do substantial justice without undue adherence to technicalities. Justice can only be done if the substance of the matter is examined. Reliance on technicalities leads to injustice. See the case of ADELUSOLA & ORS VS. AKINDE & ORS (2004) LPELR-120(SC).
The Appellant cannot be found to say that the Tribunal did not consider the issue of locus standi that was brought before it. Even the Appellant’s Counsel in paragraph 4.21 of the Appellant Brief of Argument confirmed and I quote:
“The Judgment of the lower Tribunal is also predicated on the assumption that the Appellant is the single applicant for the Appellant’s shares worth N150,037,300(One Hundred and Fifty Million, Thirty-seven thousand, Three Hundred Naira).”
Not only have I considered and come to the conclusion that the 1st Respondent has locus standi to commence this action, it is also my view that the Tribunal gave the Appellant fair hearing and was right to have held that the 1st Respondent is the single Applicant for the allotted shares. I hereby resolve this issue in favour of the 1st Respondent.
ISSUE THREE
Having regard to the facts and circumstances of this case, particularly the state of evidence before the lower Tribunal, whether the lower Tribunal was not in grave error in holding that the 1st Respondent made out a case of fraud and undue influence against the Appellant.
If I understand clearly, the argument of the Appellant’s Counsel in paragraphs 4.28 – 4.35 of the Appellant’s Brief of Argument is basically hinged on the argument that the decision of the Tribunal wherein it held the Appellant liable for fraud, misrepresentation and undue influence on the 1st Respondent is unmeritorious, as the Tribunal considered extraneous matters to come to its conclusion and that there is nowhere in the prospectus that any assurances of full issuance of shares applied for is made to the 1st Respondent.
It is quite surprising as it is trite law that a Court of law in making its findings can look at all evidence available before it.
A consideration of documents placed before a Court for its perusal, cannot in my view amount to consideration of extraneous matters in arriving at a conclusion as argued by learned counsel for the Appellant. See the following cases AKINOLA VS. V.C. UNILORIN (2004) 11 NWLR (PT. 885) 616; BADEJO VS. FEDERAL MINISTRY OF EDUCATION (1996) 8 NWLR (PT. 464) 15.
I would like to make it clear here that the undertaking by the said Caroline Nosiri Ukeka who is a staff of the Appellant forms part of the evidence before the tribunal and the Court or Tribunal is bound to look at all material evidence before it to arrive at its conclusion.
Exhibit APP. V which is the undertaking by Caroline who is the staff of the Appellant and on behalf of the Appellant is in my opinion instructive in this case.
I have read the judgment of the Tribunal at pages 570 – 575 of the Record of Appeal and I agree no less with the findings of the Tribunal as regards the issue of fraud, misrepresentation and undue influence as it relates to the transaction in question and I totally agree with its findings therein and I wish to add that the transaction between the Appellant and the 1st Respondent which was first commenced by the offer of the shares of the Appellant and then the acceptance of the offer by the 1st Respondent who made a consideration of the sum of N150,000,000 to the Appellant with the intention of entering into a legal relations and the said Caroline on behalf of the Appellant undertaking to be bound amounts to a contract.
Before there is a contract there must be a definite offer by the offeror (the Appellant) and a definite acceptance by the offeree (the 1st Respondent), and contract is enforceable when there is consideration. Consideration is something that indicates conclusively that the promisor intended to be bound.
The elements of contract are present in this transaction except that it was tainted with fraud the moment the said Caroline Nosiri Ukeka on behalf of the Appellant undertook that the 1st Respondent will get a full allotment of his shares worth N150,000,000 but the Appellant went contrary to the agreement when it went ahead to split the shares on the ground that the bulk shares cannot be allotted to one shareholder alone. So much for being a sound capital market operator.
It would also be worthy of mention to note that for all intent and purposes, the said Caroline Nosiri Ukeka who is a staff of the Appellant and whose position as staff was not refutted at any point, acted on behalf of the Appellant as far as this subject matter transaction is concerned and such position as she occupies is enough influence to persuade the 1st Respondent into entering the transaction which turns out to be tainted with fraud and misrepresentation.
As held in ASAFA FOOD FACTORY VS. ALRAINE (NIG) LTD(2002) NWLR (PT. 781) whether the said Caroline Nosiri Ukeka acted as the agent of a disclosed principal is to be determined by the nature and terms of the contract and the surrounding circumstances of this case. In this case, Caroline Nosiri Ukeka obviously acted on behalf the Appellant, a disclosed principal and also for the benefit of the Appellant.
As the Tribunal has held and I reiterate again, the Appellant knowing well that the 1st Respondent cannot be issued the full allotment of the shares he paid for, went ahead to contract with him only to turn around to say that the 1st Respondent cannot be allotted the shares in full but it would be splitted and later consolidated for the benefit of the 1st Respondent. He cannot turn around now to benefit from his own wrong.
The contention of the Appellant that the 1st Respondent received dividends and bonuses as argued by the Appellant’s Counsel in paragraph 4.34 of the Appellant Brief of Argument will not avail the Appellant as the Appellant should not be shielded from returning the 1st Respondent’s money.
The Appellant’s Counsel also argued in paragraphs 4.35 of the Appellant Brief of Argument that the decision of the Tribunal is perverse.
A decision is said to be perverse
(a) when it runs counter to the evidence;
(b) where it has been shown that the trial Court took into account matters which it ought not to have taken into account or shuts its eyes to the obvious;
(c) when it has occasioned a miscarriage of justice.
See the cases of MISR. VS. IBRAHIM (1975) 5 SC. 55; INCAR LTD VS. ADEGBOYE (1985) 2 NWLR (PT. 8) 453 and RAMONU ATOLAGBE VS. SHORUN (1985) 1 NWLR (PT. 2) 360.
However, from my afore findings, it is clear that the Tribunal relied on the evidence before it to arrive at its decision and I so hold.
On the argument of the Appellant Counsel in paragraph 4.36 – 4.37 of the Appellant’s Brief of Argument, all I have to say is that Section 290(2) of the Investment and Securities Act, 2007provides as follows:
“290(2) The Tribunal shall have, for the purposes of discharging its functions under the Act, power to:
b. Require the discovery and production of documents;
c. Receive evidence on affidavits
d. call for the examination of witness or documents;
…
…
h. do anything which in the opinion of the tribunal is incidental or ancillary to its functions under this Act.”
I believe the above reproduced function of the Tribunal is self-explanatory and from the Records of Appeal before me, not only did the Tribunal confine itself to the matters canvassed in the course of proceedings before the 2nd Respondent, if it did not, may be the Appellant could have explained HOW in clear terms.
Also, from the provisions reproduced above, the Tribunal can receive and act on documentary evidence.
What the Appellant Counsel in his argument did not avert his mind to is that every Court or Tribunal has its own rules that guides it and in this case, the Tribunal was on track.
Flowing from my findings above, I am of a very strong view that the Tribunal did not only confine itself to the matters canvassed in the course of proceedings but also relied on evidence before it in coming to its conclusion. Also, as I have already aligned myself with the finding of the Tribunal that the 1st Respondent made out a case of fraud and undue influence against the Appellant, I hereby resolve this issue in favour of the 1st Respondent against the Appellant.
ISSUE FOUR
Having regards to the 1st Respondent’s claim/appeal before the lower Tribunal vis-à-vis the facts and circumstances of the case, whether the judgment of the lower Tribunal did not amount to double/undue compensation for the 1st Respondent. Before I proceed further, it would be important for me to pen down some findings on the said salient points which the Appellant’s Counsel has drawn my attention to especially in paragraph 4.39 of the Appellant’s Brief of Argument.
I have looked carefully at my records and these are my observations:
1. The 1st Respondent from my above findings, paid for the shares that were later split into five allotments which was a formality initiated by the Appellant with a promise to consolidate same. Therefore, the said share purchase form dated 18th December, 2007 cannot be the only share purchase form submitted by the 1st Respondent.
2. The 1st Respondent initially applied for shares worth One Hundred and Fifty Million Naira (N150,00,000) of which the Appellant through its staff, Caroline Nosiri Ukeka undertook to give the 1st Respondent his full allotment by virtue of Exhibit APP. V. The Appellant breached this agreement and offered to split the shares to four allotments which would be consolidated. After the split of the shares and also from the share purchase forms i.e Exhibits APP. VII, APP VIII, APP IX, APP X and APP XI it is quite clear that the shares to be splitted should have been 770000 shares each and 777000 in the name of the 1st Respondent. However, instead of allotting the shares as applied for, 770000 shares each were allotted to the four allotees, while the 1st Respondent was allotted 543,900 shares as against the 777000 shares that should be allotted to him (This is clear from page 92 of the Record of Appeal that some monies were returned for the unallotted offer).
3. Whether the Appellant issued share certificates to the 1st Respondent is not shown in evidence before this Court.
4. I do not think that the fact that the 1st Respondent received dividends and bonuses on the shares before laying his complaint would stop him from exercising his right over a breach of agreement (I will address this later).
5. From page 92 of the Record of Appeal, it is not clear from any other evidence if the said money contained in that document was actually paid but it is clear from the document dated January 13, 2009 that the document was received under protest on the 18th January, 2009.
6. The time within which the 1st Respondent lodged a complaint in my view is not an issue here, what is; is that there is a breach which in my opinion amounted to the filing of the complaint by the 1st Respondent to be resolved.
Now addressing the points raised by the Appellant in the Appeal, it is necessary to bring out some points as follows:
a. Whether accepting dividends on his shares, amounts to waiver and acquiescence by the 1st Respondent.
b. Whether there is nexus between the 1st Respondent’s claim and the reliefs granted by the Tribunal.
Whether accepting dividends on his shares, amounts to waiver and acquiescence by the 1st Respondent
Firstly, in addressing this point, it is worthy of note that it has already been established that the transaction leading to this appeal is contractual and it is trite that in matters of simple contract, action against breach can be commenced within six years from when the cause of action arose which is from when the breach occurred.
The breach in the transaction between the 1st Respondent and the Appellant occurred the moment the Appellant through its staff, Caroline Nosiri Ukeka signed the undertaking to allot the 1st Respondent with the full shares he paid for but the Appellant went ahead to split the shares with a promise to consolidate same which he never did.
From the Exhibit APP. II it shows that the breach occurred in 2007, two years from the time the complaint was made. This means that the 1st Respondent was within time when he laid his complaint about the breach of the contract by the Appellant.
Also, I will not remove my mind from the fact that there was a continued breach even after the Appellant’s decision to split and allot the shares into five allotments. The 1st Respondent was made to pay an extra sum of N37,300.00 to make for a total of N150,037,300 as against the N150,000,000 Million worth of shares agreed. Again, the Appellant alleges that it returned the sum of N18,000,000.00 on the excuse that in the final analysis the bank is yet unable to allot shares to the value of the total of N150,037,300.
The Appellant represented by its staff Caroline Nosiri Ukeka at the ‘All Parties Meeting’ confirmed that she signed an undertaking for full allotment of shares paid for to the 1st Respondent which agreement, the Appellant failed to keep but went on to breach the agreement as I had already illustrated above. The Appellant did not even reject the argument of the 1st Respondent as regards these breaches. The Counsel to the Appellant even agreed in paragraph 4.39 of the Appellant’s Brief of Argument that the 1st Respondent was allotted 543,000 units of shares and that there were un-allotted shares.
Secondly, at this point, I agree no less with the findings of the Tribunal that the Appellant knowing well that the contract is tainted with illegality cannot now turn round to set up fraud for which he was part of to deprive the 1st Respondent of the sum paid to it in consideration of the contract which it breached the contents or can the filing of the complaint at the time he did be a waiver or an acquiescence.
From the above findings which I have made, I am of the very firm opinion that the 1st Respondent did not waive his right to file a complaint and he did not acquiescence to the wrongful act of breach of the agreement by the Appellant. This point is hereby resolve in favour of the 1st Respondent.
Whether there is nexus between the 1st Respondent’s claim and the reliefs granted by the Tribunal I do not wish to over flog this issue as I have addressed it in my findings on the fore-going issues which I have raised.
Before I conclude, it is important to mention that I agree in totality with the findings of the trial Court as regards the award of general and special damages. See pages 586 – 588 of the Record of Appeal, Volume 2 and I adopt same as my findings before this Court. It is further my considered view that there is a nexus between the claim and the reliefs sought by the 1st Respondent. I hereby resolve this issue in favour of the 1st Respondent.
In the final result, I hereby hold in addition to the decision of the Tribunal as follows:
i. I hereby declare that the Appellant’s guarantee/Undertaking dated the 17/12/2007 is subsisting valid and enforceable against the Appellant.
ii. I hereby declare that the 1st Respondent has the right to act and indeed, did act on the said guarantee/Undertaking in writing in cancelling his said N150 million fixed deposit at Diamond Bank Plc.
iii. I hereby declare that the Appellant is guilty of a fundamental breach of the said guarantee / Undertaking in Writing and of a later promise, understanding and oral agreement, resulting in a total failure of consideration.
iv. I hereby declare that the Appellant’s Staff; Caroline Nosiri Ukeka at the time it made or caused to be made the said fraudulent representations both as per Guarantee/Undertaking and or the said later arrangement, promise, understanding and agreement, knew them to be absolutely false, dishonest, fraudulent, and untrue, or made them recklessly, not caring whether they were true or false.
v. I hereby declare that the Appellant made or caused to be made, in writing and the said later arrangement, promise, understanding and agreement with the sole purpose of fraudulently luring and inducing the appellant to buy its said shares and part with his said N150 million.
vi. I hereby declare that the Appellant’s conduct in the share purchase matter is callous, criminal, willful deceit, unjust enrichment, despicable and reprehensible as it exposed the appellant to a huge, colossal, painful but avoidable losses.
vii. An order directing the Appellant to return the 1st Respondent’s total net investment of N132,032,300 (One Hundred and Thirty-Two Million, Thirty-Seven Thousand, Three Hundred Naira) only, in the said share purchase, after deducting any certified dividends so far paid and received by the Appellant’s various members qua directors of OPMI (if any).
This appeal fails and it is dismissed. No order as to cost.
ABDU ABOKI, J.C.A.: I have had the singular opportunity of reading in draft, the lead judgment just delivered by my Learned Brother MOHAMMED BABA IDRIS, J.C.A.
Having perused the records, and the submissions on the issues raised by the parties in the briefs of argument which were well considered and dealt with creditably, I have no doubt whatsoever, that the appeal is unmeritorious. Therefore, for the reasons ably marshaled in the lead judgment which I adopt as mine, I too hereby dismiss the appeal.
I abide by the Orders made.
STEPHEN JONAH ADAH, J.C.A.: I was privileged to read in draft the judgment just delivered by my learned brother, Mohammed Baba Idris, JCA.
I am in complete agreement with his reasoning and conclusion which I adopt as mine. This appeal has no merit and I do dismiss the appeal. The decision of the Tribunal is hereby affirmed.
Appearances:
D. AKINLAJA, SAN with him, A. AJIBADE, ESQ., and O. IGBINOBA, ESQ. For Appellant(s)
P. ABHULIMEN, ESQ., with him, E. ONUCHE, ESQ., and C. A. AFENI, ESQ. for the 1st Respondent For Respondent(s)