British American Tobacco (Nig.) Ltd. V. Emmanuel O. Ogunseye & Ors. (2009)
LawGlobal-Hub Lead Judgment Report
SIDI DAUDA BAGE, J.C.A.
This is an appeal by the Appellant, Defendant in the lower Court, against the Ruling of B. I. Molokwu J., sitting at the Ibadan Judicial Division of the Federal High Court, delivered on 22nd September, 2004.
Briefly, the facts culminating in this appeal are as follows:-
- “The Respondents and the persons on whose behalf they allegedly sued, were in the service of the Nigerian Tobacco Company (NTC), they contributed to the Company’s Provident Fund (CPF) monthly and percentage of their respective contributions depended on the salary scale of each worker. The said monthly contributions were in turn invested by the Nigerian Tobacco Company (NTC) in other business with the understanding that on leaving the Company for any reason, they were entitled to collect interest that might have accrued on the contribution together with total contribution they made. The Respondents claimed that it was their employers’ practice to call back by notice on the Company Board, Such workers that might have left the service to come and collect their due until it was unduly stopped and discontinued when they left the Company’s service.
- The Respondents alleged that the capital gains entitlement was only paid once to those who served between 1987 and 1995 leaving out employees that served between 1961 and 1986. They equally alleged that there were unexplained discrepancies in the payment made to some staff.
The Appellant consequent upon entering Appearance, filed a Notice of Preliminary Objection to the jurisdiction of the Federal High Court to entertain and determine the Suit being one connected to the Respondents’ contract of employment”.
In its Ruling dated 22nd September, 2004, the Court conferred jurisdiction on the Federal High Court to the exclusion of any other Court, as the Respondents’ claim came within the provisions of Section 348 of the Companies and Allied Matters Act, 1990 and therefore the Federal High Court has exclusive jurisdiction to entertain and determine the matter.
Dissatisfied with this Ruling of the lower Court dated the 22nd September, 2004, the Appellant (Defendant/Respondent), appealed to this Court vide their Notice of Appeal dated 4th October, 2004.
Both Parties have in compliance with the Rules of this Court, filed their Briefs of Argument The Appellant’s Brief was dated and filed the 31st January, 2007, The Respondents’ Brief dated 10th of April, 2007, but filed on the 8th of June 2007, In the Appellant’s Brief, One Issue for determination was formulated and that is:-
“Whether the learned trial Judge was in error when he held that the Federal High Court has the jurisdiction to entertain and determine the suit having regard to the clear provisions of Section 251 of the Constitution of the Federal Republic of Nigeria, 1999 and the claim of the Plaintiffs? (Formulated from Grounds 1 and 2).”
The Respondent also formulated only One Issue for the determination of this Court and that is:-
“Whether by virtue of Section 384 of the Companies and Allied Matters Act (CAMA)and Section 5 of Decree 107 of 1997 (now Section 251 (1) (e) of the 1999 Constitution of the Federal Republic of Nigeria) the Plaintiffs’ claim is not within the jurisdiction of the Federal High Court of Nigeria”.
I will consider each party’s Issue separately in treating this appeal. It is the submission of learned Counsel for the Appellant that Courts are expected to expound their jurisdiction and not to expand it. The subject matter of the Respondents’ case arose from their alleged rights and benefits under their contract of employment and the Federal High Court lacks the jurisdiction to entertain an action relating to a contract or agreement based purely on a Master/Servant relationship or a simple contract because an action founded on a contractual employment relationship between a Company and its Employees or Ex-employees is not a matter connected with or pertaining to the operation of a Company notwithstanding that the Defendant is a Company. Learned Counsel to the Appellant further submits that, except for matters falling within Section 251 of the Constitution of the Federal Republic of Nigeria 1999, the High Court has unlimited jurisdiction in all other matters. See:- Dalfam (Nig.) Ltd. Vs. Okaku International Ltd. (2001) 15 NWLR (pt.735) 203 at 242 Paragraph H Cant. Ind. Gases Ltd. Vs. Onafeko (2003) 7 NWLR (Pt. 820) 479 at 492 Paragraphs A-C; 5 PDCN Ltd. Vs. Nwakwa (2003) 6 NWLR (Pt. 815) 184 at 204 Paragraphs F-G; Attorney General of Oyo State Vs. NLC (2003) 8 NWLR (Pt. 821) at 32 Paragraph E; University of Ilorin Vs. Adeniran (2003) 17 NWLR (Pt. 849) 214 at 226 Paragraph H.
Learned Counsel to the Appellant further submits that the trial Court erred when it held that it had jurisdiction in a suit subject matter of which is entirely outside the jurisdiction and competence of the Federal High Court. Learned Counsel to the Appellant further submits that it is trite law that it is not the status of the parties that determines whether a trial Court has jurisdiction but the cause of action as garnered from the Writ of Summons and the Statement of Claim. See:-
Cant. Ind. Gases Ltd. Vs. Onafeko (supra). Learned Counsel to the Appellant further submits that Section 384 of the Companies and Allied Matters Act, 1990 does not apply to this case because, a Company’s provident fund is different from what is envisaged under the Section which is a share participatory scheme in which employees are Shareholders in their own “Employer Company”. See:- Ajadi Vs. Ajibola (2004) 16 NWLR (Pt. 898) 91 at 157-158 Paragraphs H-A and KLM AirlinesVs. Kumzhi (2004) 18 NWLR (Pt. 875) 231 at 256-257 Paragraphs H-A. Learned Counsel to the Appellant further submits that when the question as to whether or not a Court has jurisdiction under a statute, it is not a matter for circuitous explanation and it is either jurisdiction is conferred, or it is not. It must appear ex-facie the enactment relied on as conferring such jurisdiction that indeed such jurisdiction has been conferred. See:- KSIEC Vs. PDP 2005.) 6 NWLR (pt.920) 25 at 51-52 Paragraphs G-C.
Learned Counsel to the Appellant further submits that from the examination of the facts of this case will not justify the application of Section 251 (1) (e) of the 1999 Constitution, because, the claims of the Respondents are based on their contract of employment and does not arise from the operation of the Companies and Allied Matters Act and their determination does not require a recourse to the provisions of the Act.
See:- Cont. Ind. Gases Ltd. Vs. Onafeko (Supra). Learned Counsel to the Appellant further submits that a Court is incompetent where the subject of the case is outside its jurisdiction and there is any feature in the case, as in the present case which prevents the Court from exercising its jurisdiction. See:- Cotecna International Ltd. Vs. IMB (2006) 9 NWLR (Pt. 985) 275 at 295 Paragraphs E-G and Madukolu VS. Nkemdilim (1962) 2 SCNLR 341. Learned Counsel to the Appellant finally urged this Court to allow the appeal, set aside the entire decision of the Federal High Court contained in the Ruling of B. I. Molokwu, J., delivered on 22/9/2004 and to uphold the Preliminary Objection of the Appellant by striking out the action of the Respondents in the lower Court.
In reply, learned Counsel to the Respondents submits that, it is the fundamental principle of law that it is the claim of the Plaintiff that determines the jurisdiction of the Court. Claims are seen as endorsed on the Writ of Summons and more particularly in the Statement of Claim. See:- Attorney General of Federation Vs. Guardian Nig. Ltd. (1979) 69 LRCN Page 1531 at 1601, Madukolu Vs. Nkemdilim (1962) 1 All NLR 587 at 595. Learned Counsel to the Respondents further submitted that the (Plaintiffs’ Claim) Respondents relates to profit sharing of the (Defendant’s Company) Appellant, and nothing more, and for that reason, it will come under Section 384 of the Companies and Allied Matters Act (CAMA) and Section 251 (1) (e) of the 1999 Constitution of the Federal Republic of Nigeria. Learned Counsel to the Respondents further submits that the clear and unambiguous provisions of the two (2) laws above, are strong and sufficient enough to support the jurisdiction of the lower Court.
The learned Counsel to the Respondents further submitted that from the (Plaintiffs’ Statement of Claim), Respondents are lawfully claiming their respective shares in the profit of the Defendant’s Company as an incentive realisable from their investment over the years as employees of the Appellant that participated in the compulsory contribution. The profit or the capital gains entitlement is only payable to the Plaintiffs after leaving the service of the Defendant’s Company. Learned Counsel to the Respondents further submits that the provisions of Section 348 of Companies and Allied Matters Act (CAMA)was appropriately envisaged in Section 5 of Decree 107 of 1997, now Section 251 (1) (e) of 1999 Constitution of the Federal Republic of Nigeria which confers jurisdiction on the Federal High Court on matters of this type, i.e., shares of profit due to Ex-employees of a Company.
The learned Counsel to the Respondent further submits that the claim of the Respondents (Plaintiffs) in the Federal High Court, is not for unlawful termination, damages, reinstatement or any of such claims, therefore, the claims as are placed, the Federal High Court are appropriate and are friable by it. Learned Counsel to the Respondents submits finally that the lower Court was right to hold that it had jurisdiction relying on the clear and unambiguous provision of Section 384 of Companies and Allied Matters Act (CAMA) and Section 5 of Decree 107 of 1997 (now) Section 251 (1) (e) of the 1999 Constitution of the Federal Republic of Nigeria, and this Court is being urged to dismiss this appeal and uphold the Ruling of the lower Court, delivered on 22nd September, 2004.
On the part of this Court, after a careful examination of the arguments proffered on both sides, there is both a point of convergence and a point of divergence by the Appellant and the Respondents respectively in arguing this appeal. The point of convergence in the arguments of both the Appellant and the Respondents alike is that, both agree, it is a fundamental principle that jurisdiction is determined by the Plaintiff’s claim. Both cited in agreement the Supreme Court decisions of Tukur Vs. Government of Gongola State (1989) 4 NWLR (Pt. 117) 517 at 549 Paragraphs B-C; and Egonu Vs. Borno Radio Television Corporation (1997) 12 NWLR (pt. 531) 29 at 43 Paragraphs F-G.
This aspect will require no further elucidation.
The point of divergence between the Parties rest on the fact that while it is the contention of the Appellant, even at the lower Court where he filed a Notice of Preliminary Objection that the suit concerns the National Provident Fund Contribution of the Respondents whilst in the employment of Appellant, as well as their entitlement to the capital gains tax after their retirement, the relationship between the Appellant and the Respondents concerns contract of employment which is not covered by Section 251 of the 1999 Constitution. Being the issue of the National Provident Fund Scheme is both of a policy and statutory nature in the absence of a clear legislation such as the constitution conferring jurisdiction on the Federal High Court, to deal with suits of this nature, the Federal High Court cannot assume jurisdiction on this matter.
The Respondents however maintained that their Claims at the lower Court, Federal High Court, are not based on contract of employment, but on an agreement. This agreement was for giving an incentive to the workers by the payment to them of a certain percentage of their compulsory contributions to the National Provident Fund Scheme. The law that governs the claim of the Respondents in this suit is Section 384 of the Companies and Allied Matters Act (CAMA), Cap 59, Laws of the Federation of Nigeria, 1990; and Section 251 (1) (e) of the 1999 Constitution of the Federation. These laws confers jurisdiction over such matters on the Federal High Court. At this point, it is only pertinent to state the provisions of these laws to ascertain the claim and counter-claim of the Parties in respect thereof. Section 384 of the Companies and Allied Matters Act Cap 59 Laws of the Federation of Nigeria provides:-
“If under his contract of service an employee is entitled to share in the profits of the Company as an incentive, he shall be entitled to share in the profits of the Company whether or not dividends have been declared”.
Section 251 (1) (e) of the 1999 Constitution of the Federal Republic of Nigeria provides:-
Section 251
(1) “Notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to exclusion of any other Court in civil causes and matters”.
(e) “arising from the operation of the Companies and Allied Matters Act or any other enactment replacing that Act, or regulating the operation of Companies incorporated under the Companies and Allied Matters Act”.
The National Provident Fund Act, Cap 273, Laws of the Federation of Nigeria, 1990, Section 2 (1) thereof, provides:-
“In this Act, unless the con otherwise requires “Advisory Council” means the National Provident Advisory Council under this Act “.
The law is already settled on the interpretation of a statute where the words used, are clear and unambiguous, it must be given its ordinary meaning. See:- Gani Fawehinmi Vs. Nigerian Bar Association (2002) 50 WRN 27; (1989) 2 NWLR (Pt. 105) 558; U.T.C. Nigeria Ltd. Vs. Chief J. P. Pamotei & Others (2001) 43 WRN 63; (1989) 3 SC 79; Attorney-General of the Federation Vs. All Nigeria People’s Party (ANPPL.12003) 15 NWLR (Pt. 844) 400; People’s Democratic Party (PDP) Vs. Independent National Electoral Commission (INEC) (1999) 11 NWLR (pt. 262) 200; P. N. Uddoh Trading Company Ltd. Vs. Sunday Abere (2001) 1 WRN 1; (2001) 11 NWLR (Pt. 723) 114.
In giving interpretation to the provision of both the Constitution and Companies and Allied Matters Act (CAMA) stated above, the trial Judge at Page 58 of the Records stated as follows:-
“Also worthy of note, is the fact that the other retired employees of the Company hitherto, had been paid their dues upon retirement. This therefore appears to me to be a matter covered by an agreement between the Parties to give incentive to workers to contribute to the fund. These claims therefore cannot be considered to be within the normal run of the affairs of an ordinary master/servant, or employer/employee relationship. The claims therefore to my mind, derived from a special and peculiar arrangement or agreement between the Parties.
As specified in the Statement of Claim, both the Company and the contributing staff stood to benefit from the scheme. The Company invested the funds accruing from the scheme in its business whilst the contributing staff stood to gain from both the capital contribution and interest accruing thereon. This to my mind, is a scheme related to the running and administration of the Company’s business. The controversy that has arisen, is due to the closure of the Company for business and its failure or inability to honour the terms of the agreement reached with its erstwhile employees, to pay the savings made under the Company’s Provident Funds Scheme. This Contributory Scheme appears normal in business organizations to secure a reasonable sum of money for the Employees upon retirement, or during closure or winding up of a Company.
From the foregoing, it is my view that, it is impossible not to conclude that, the matter arose from the normal operational or administrative procedure of a Company. In that case, I fail to see how it can be said to be a matter outside the purview of the Federal High Court’s jurisdiction. In the light therefore, I cannot but agree the Companies and Allied Matters Act (CAMA), Cap 59, Laws of the Federation of Nigeria, 1990 and in particular the provisions of Section 384 of that law, are most apt and applicable in this instant case. In furtherance of the arguments herein, it has to be said that the provisions of Section 25 (1) (e) of the 1999 Constitution, confer jurisdiction on matters of this nature on the Federal High Court of Nigeria, to the exclusion of any other Court.
From the foregoing, I am fortified in my conviction that the Federal High Court is more than empowered with jurisdiction to entertain and dispose of this matter to the exclusion of all other Courts. I find support for that view in the Court of Appeal, Ibadan Division unreported case in Suit No. CA/I/217/99: Nigeria Tobacco Company ltd. Vs. F. O. Osifeso & Others (for themselves and on behalf of the Ex-Nigerian Tobacco Company Staff, Ibadan affected by the severance and closure of September, December, 1994 respectively)”.
I do not have any reason to depart from the interpretation made by the trial Judge above in respect of the jurisdiction of the Federal High Court to the exclusion of any other to hear and determine the suit filed by the Respondents before it. Also, this Court had made a pronouncement on this issue in the unreported case of this Division in Nigeria Tobacco Company Plc. Vs. F. O. Osifeso & 2 Others {Supra} which originated from the Federal High Court in Suit No. FHC/IB/CS/16/99:- Mr. F. O. Osifeso & 2 Others Vs. Nigeria Tobacco Company Plc. This case is in all fours with the present suit. This Court in its judgment on the 13/07/2000, upheld the submission that the Federal High Court had jurisdiction over the matter.
I cannot find any reason to depart from the decision of the Court in suit mentioned above, and I have no doubt in my mind that the claims of the Respondents at the lower Court is covered by the provisions of Section 251 (1) (e) of the 1999 Constitution and Section 384 of Companies and Allied Matters Act (CAMA), Cap 59, Laws of the Federation of Nigeria, 1990.
To give more strength to the decision of this Court, is the National Provident Fund (General) Regulations Act, Cap 273, Laws of the Federation of Nigeria, 1990. On the voluntary coverage of the participation in the fund activities, Section 4 (1) provides:-
“An application by an employer, who has in his service less workers than the number for the time being prescribed, for himself and his workers to become subject to the Act, shall be in prescribed Form N.P.F. 3 and the grant of such an application shall be in prescribed Form N.P.F. 4”.
(2) provides:-
“An application by an employer for his workers to cease to be voluntarily subject to the Act shall be in prescribed Form N.P.F. 5 and the grant of such an application shall be in prescribed Form N.P.F. 6”.
(3) “An application from any worker to be allowed to become a voluntary contributor shall be in
prescribed Form N.P.F. 7 and the grant of such application shall be in prescribed Form N.P.F. 8”.
I shed no doubt in my mind that since the Act itself made the participation in the fund voluntary, it cannot be tied to a contract of employment as argued by the Appellant. A contract as defined by the Blacks Law Dictionary Eight Edition, provides:-
“An agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law – a binding contract”.
From the definition of contract above vis-a-vis the provision of the National provident Fund (General) Regulations Act, Cap 273, Laws of the Federation of Nigeria, 1990, which makes it voluntary, the argument of the Appellant that the participation in the fund is part of the contract of service between the Appellant and the Respondents fails. The most acceptable position is that of the Respondents that since the participation is voluntary, it is simply an agreement between the Appellant who is the employer and the Respondents who are the employees. I agree once more with the trial Judge because of the voluntary nature of the scheme; it only relates to the running and administration of the Company’s business (Appellant). That being the case, therefore, the provisions of Section 384 of Companies and Allied Matters Act (CAMA), Cap 59, Laws of the Federation of Nigeria, 1990 and Section 251 (1) (e) of the 1999 Constitution, are most apt and applicable in determining the controversy between the Appellant and the Respondents in this appeal. By the combined effect of the two laws cited above, the Federal High Court has exclusive jurisdiction to the exclusion of any other Court to deal with this suit, the subject of this appeal.
In the final analysis, this appeal fails for lacking in merit and it is accordingly dismissed. As a result, the Ruling of the Federal High Court, Ibadan Division, Coram Molokwu, J., delivered on the 22nd day of September, 2004 in Suit No. FHC/IB/CS/64/2002, striking out the Preliminary Objection of the Appellant, is hereby affirmed by this Court.
Costs of N30,000.00 is awarded in favour of the Respondents and against the Appellant.
Other Citations: (2009)LCN/3330(CA)
