Relevant laws and regulations
- CFRN
- FHC act
- CAMA
- Company proceedings rules
- Companies winding up rules
- FHC (civil procedure) rules
CAMA
CAMA has several provisions regarding the role of the court in company (or companies) affairs. S 39(4); s46 (2)
S567 – interpretation act
“Court” or “the court” used in relation to a company…..
CFRN
S251 (1) list out the jurisdictional powers of the court – FHC shall have and exercise exclusive jurisdiction
- Arising from the operation of the companies and allied matters act or any other enactment
FHC Act
S 7(1) c of the FHC act says the same thing the constitution says
Company proceedings rules
The company proceedings rules deals with part A of CAMA – companies
Rule 21
- These rules shall apply to all proceedings taken out or arising from any provision of any section of part A of the companies and allied matters cat
- The forms set out in the schedule to these rules and any other form in use in ordinary civil proceedings if the court where applicable or any forms which may, from time to time, be made on order of the chief judge may be used.
Mode of application in company proceedings
- Originating summons
- Originating motion
- Writ of summons
- Originating application
- Petition
Agip (Nig.) Ltd v Agip petroli Int’l [2010] 5 NWLR (pt.1187) –
The minority shareholders wanted to challenge the transfer of Agip Petroli 60% shares in Agip Nig to someone else. This case was a case of derivation action – read the case.
Originating summons
This is one of the modes of commencing a civil action.
An action is commenced by an originating summons when
- it is required by a statute or
- a dispute , which is concerned with matters of law, is unlikely to be any substantial dispute of fact
Rule 2 (1) – this is the default method of bringing an application with exceptions set out in rule 3 & 4
See (2) & (3)
Section 638 is part of the CAMA that was repealed.
The originating summons by which an application for leave under s 254(1) of the act is made shall be entitled in the matter of the company in relation to which the plaintiff was convicted or was guilty of such an offence or of such conduct as is mentioned in the said section and in the matter of the act. Rule 1 (2)
S254(1) deals with restraint of fraudulent person from serving as directors
Derivative actions are instituted in the court by originating summons
Originating motion
This mostly contains mixture of law and facts and is used where there is need to remedy an error or omission or where the party bringing it wants to benefit from a set of rules.
The company proceeding rules brings the relevant provisions under which a person can bring an action under originating motion. See rule 3 (a) –(g)
Note (c) – popular for exam questions, it says “ under s90(1) for the rectification of the register of members of a company”
Petition
This is used when prescribed by law. See instances it would be used under rule 4
Writ of summons
This is rarely used for proceedings at the FHC flowing from CAMA. See rule 19 CPL, however there is really no exception because the default is originating summons so if there is no rule, it would be brought by originating summons. However matters outside CAMA e.g. tort or breach of simple contract can be taken to the state high court and will be brought by writ of summons but for matters covered by CAMA the default is originating summons.
AGIP V EZENDU
Originating applications
The prescribed originating process at the investment and securities tribunal
Rule 6(1) of the investment and securities tribunal (procedure rules) 2003
Criminal proceedings
Prosecution of offenders
S 554 (1)
CAC’s power to impose fines
They have power to impose fines under provisions of CAMA but they don’t have power to convict because they are not a court. However when CAC imposes a fine such fine would not be seen as a conviction.
CAC v Seven Up Bottling Plc (2017) 5 NWLR (pt.1558) 241 – CAC imposed a fine on Seven Up and their directors.
SEE s 548(2)
Entitlement of proceedings
Rule (1) of CPR
Every originating summons, notice of originating motion and petition by which any such proceedings are begun and all affidavits, notices and other documents in those proceedings shall be entitled in the matter of the company in question and in the matter of the companies and allied matters act.
Draft till the parties for originating motion
IN THE FEDERAL HIGH COURT
IN THE LAGOS JUDICIAL DIVISION
HOLDEN AT LAGOS
SUIT NO: FHC/IKC/9809
IN THE MATTER OF ABC LTD AND IN THE MATTER OF COMPANIES AND ALLIED MATTERS ACT CAP C20 LFN 2004
BETWEEN
XYZ PLC …………………………………………….………………APPLICANT
AND
- ABC LTD
- MR GBENRO AJIBADE (MANAGING DIRECTOR)………….RESPONDENT
Note that you should add a director or key official in the company as a party to enforce the order made on the company
Draft till the parties if it was a derivative action
Derivative action is instituted by originating summons
Note: The shareholder sues in his own name as the applicant because the company is not suing (even though his right to sue is obtained from the company) and sues the company as a defendant so the company can be bound and also name the directors that are in breach as respondents so they can be bound by that action.
IN THE FEDERAL HIGH COURT
IN THE LAGOS JUDICIAL DIVISION
HOLDEN AT LAGOS
SUIT NO: FHC/IKC/9809
IN THE MATTER OF ABC LTD AND IN THE MATTER OF COMPANIES AND ALLIED MATTERS ACT CAP C20 LFN 2004
BETWEEN
EDWARD OSIKE ………………………………..APPLICANT
AND
- ABC PLC
- SUPREME UNUKEGWO
- MOTUNRAYO OLOWU …………………..RESPONDENT
Learn the instances that would use originating motion and petition. See rule 3 & 4 of CPL
Jurisdiction of FHC
See First Bank of Nigeria Plc & Anor vs Bensegba Technical services limited and anor LER
NASHTEX INT’L LTD V HABIB (NIG) BANK LTD (2007) 17 NWLR (PT.1063) 308
Investment disputes under ISA
S 284 ISA
Note that IST only deals with civil issues
The tribunal shall to the exclusion of any other court of law or body in Nigeria, exercise jurisdiction to hear and determine any question of law or dispute involving –
- A decision or determination of the commission in the operation and application of this act, and in particular, relating to any dispute –
- Between capital market operators;
- Between capital market operators and their clients;
- Between an investor and a securities exchange or capital trade point or clearing and settlement agency
- Between capital market operators and self-regulatory organizations
- The commission and self-regulatory organization
- A capital market operator and the commission
- An investor and the commission;
- An issuer of securities and the commission ; and
- Disputes arising form the administration, management and operation of collective investment schemes
‘commission’ here refers to SEC
also see IST rules
Section 315 ISA defines self-regulatory organization
BETWEEN THE IST AND THE FHC
IST has exclusive jurisdiction over matters flowing from the application of the ISA – operations of the capital, capital securities market
WEALTHZONE LIMITED V SECURITIES AND EXCHANGE COMMISSION (2016) LPELR – CA/A/268/2008
However FHC will have exclusive jurisdiction where the principal claims in a matter are against federal government agencies, even though it is a matter relating to the capital market and sundry issues.
NOSPECTO OIL & GAS LTD V OLORUNNIBE (2012) 10 NWLR [PT.1307] CA115 – the case simply says that regardless if what the ISA says the constitution is supreme.
Regulatory framework for investment dispute resolution in Nigeria
Reconciliation or amicable settlement by parties through self-regulatory organizations
ADR
Administrative proceedings committee of SEC IST
Court of Appeal
Supreme Court
Dispute resolution clauses in investment agreement
Most investment agreements today include provisions for referral to ADR in the case of disputes arising. Arbitration appears to be the first choice among the ADR options.
ADR advantages
- Finality
- Privacy
- Speed
- Specialization of arbitral panel
Draft an ADR clause
Any dispute, disagreement arising from a breach or renunciation of the contract within is to be resolved by arbitration with
Place of arbitral settlement:
Procedure to be applied
Laws applicable
Rules to be applied
Language to be used in arbitral proceedings: English
Administrative Proceedings Committee of SEC
Rule 599 (2) SEC rules
Rule 2: Parties
- b) In any other case
Rule3: reference of matters to the committee
- Complaints shall be forwarded to the commission by the complainant or its/his representative
INVESTMENT AND SECURITIES TRIBUNAL – s 275
Composition of the tribunal
Tribunal shall consist of ten (10) person to be appointed by the minister as follows:
- a full time chairman who shall be a legal practitioner of not less than fifteen (15) years with cognate experience in capital market matters;
- Four other full time members, three of whom shall be legal practitioners of not less than 10 years…..
Constitution of the tribunal – s 276
The tribunal shall be duly constituted if it consists of not less than 3 members of the tribunal. S 276 (1)
Tribunal panels
Powers and procedures of the tribunal – s 290 (2)
The tribunal shall have for the purpose of discharging its functions under this act, power to –
- summon and enforce the attendance of any person and examine him on oath;
- require the discovery and production of documents;
- receive evidence on affidavits
- call for the …..
The tribunal is a civil court – s 290 (3)
Jurisdiction of the tribunal – s 284 (1) see note above
Appeals to IST
Appeals can lie from a decision by SEC ( as well as a fresh action) – s 289
14 days notice must first be given to SEC
To be filed within 30 days from the date on which a copy of the order which is being appealed against is made,
So it also has appellate jurisdiction on decisions by SEC
Appeals from IST – s 295
Any person dissatisfied with a decision of the tribunal may appeal against such decision to the court of appeal if –
- The decision was taken in the exercise of its appellate jurisdiction, on points of law only; or
- It is final decision taken in the exercise of its original jurisdiction, on point of law or mixed law and fact; or
- It is an interlocutory decision of the tribunal, on points of law only
(2) Without prejudice to the power of the tribunal to review its own decision
Further appeals – s 297
Judgment of the tribunal – s 293
- ….
- ….
- …..
Service of court process and other documents on a company – s 78 CAMA
“ A court process shall be served on a company in the manner provided by the rules of court and any other document may be served on a company by leaving it at , or sending it by post to, the registered office or head office of the company”
Service of originating court process
Order 7 rule 9 High court of Lagos state (civil procedure) rules 2012
Originating process or other process requiring personal service may be served on company by delivery to a director, secretary, trustee or other senior, principal or responsible officer of the organization or by leaving it at the registered, principal or advertised office of place of business of the organization within the jurisdiction.
Note that the location of the director at the time of service is not relevant so long its lagos so he can be served at quilox. The rule says nothing about the place where the director is found.
Foreign company within the meaning of s54 CAMA
- provided that where a foreign company
federal high court (civil procedure) Rules
When the suit is against a corporation or a company authorized to sue and be sued in its name or in the name of an officer or trustee, the writ or other document may be served, subject to the enactment establishing that corporation or company or under which the company is registered, as the case may be, by giving the writ or document to any director …..
For company there is no substituted service because the company is not like an individual that can abscond and one of the reasons a company has a registered address is for service of court processes or other documents.
MARK V EKE (2004) 5 NWLR PT865 pg. says there is no substituted
Service of originating processes on companies – summarily
Serve a principal officer of the company.
Leave it at the office of the company/corporation duly acknowledged by a named official.
Service of other documents other than originating court process – s 78
Criminal matters involving a company can be taken to any court of competent jurisdiction but in practice its best to be taken to the FHC