Central Bank Of Nigeria & Anor V Mrs. Agnes M. Igwillo (2007)

LAWGLOBAL HUB Lead Judgment Report

S. A. AKINTAN, J.S.C 

This action was instituted at Lagos High Court by Dr. Victor Igwillo, now deceased, in suit No. LD/1227/93. His claim, as set out in paragraph 32 of his amended statement of claim was for a declaration that the termination of his appointment with the 1st appellant is wrongful, illegal and unconstitutional; and the sum of N14.5 million being special, aggravated and/or general damages suffered for the wrongful and unlawful termination of appointment or, in the alternative, a reinstatement to his job and payment of his accrued salaries and allowances from the date of suspension till the date of reinstatement. Pleadings were filed and exchanged and the trial took place before Ope-Agbe, J.

The plaintiff gave evidence at the healing and tendered a number of documents. The defendants, now appellants denied the claim and in paragraph 10 of their reply to the further amended statement of claim, counter-claimed for “the sum of N450,000 per annum being the value for the occupation of the 1st defendant’s premises from 4th February, 1993 till plaintiff’s vacation of same.” At the conclusion of the trial, the learned trial Judge held that there was no merit in the plaintiff’s claim and the suit was dismissed. The counter-claim was also dismissed.

The plaintiff was dissatisfied with the judgment of the trial High Court. He filed an appeal against it to the Court of Appeal (hereinafter referred to as the court below). The court below found that there was merit in the appeal and allowed it. The Court held, inter alia, as follows in the concluding paragraph of the lead judgment of Akaahs, JCA delivered on 15th May, 2000 to which Ige and Aderemi, JJ.CA agreed: “In conclusion, I find that there is merit in the appeal and I accordingly allow it. I declare the purported termination of the appointment as illegal, unconstitutional, ultra vires, null and void and of no effect. The appellant is accordingly reinstated to his post as Deputy Librarian of the Central Bank in the cadre of Assistant Director without loss of status and years of

services and the payment of the arrears of his salary and allowances from the date of his suspension, i.e. 8th May, 1992.” The appellants were not satisfied with the judgment of the court below and the present appeal was filed against the said verdict. The parties filed their respective brief of argument in this court. The appellants formulated the following two issues in their joint brief as arising for determination in the appeal:

“1. Whether the court below was right when it looked beyond the terms of the contract of employment and the evidence on record in deciding the issue whether the termination of the respondent’s contract of employment with the 1st appellant was wrongful.

(2) Whether the respondent was entitled to reinstatement to his former post in the circumstance of this case.” The respondent also formulated two similar issues in the respondent’s brief. I therefore do not consider it necessary to reproduce them. I will therefore consider the appeal based on the two issues formulated in the appellants’ brief. The plaintiff/respondent at the court below died on July 20th, 2002 and the present appellant, Mrs. Agnes M. Igwillo, his wife was, with leave of this court, substituted for her late husband. The brief facts of the case, as set out in the pleadings and evidence led at the trial, are that the plaintiff, Dr. Victor Igwillo, was a holder of Ph.D. in Library and Information Sciences. He started his working career at the Ahmadu Bello University Library. From there he joined the Anambra State University of Technology (ASUTECH) before joining the 1st appellant as Deputy Librarian. His case was that the post was advertised and he applied, was interviewed and offered the appointment by the 1st appellant, the Central Bank of Nigeria. The plaintiff/respondent contended that before joining the 1st appellant, it was agreed that he would be accepted on transfer of service, having served 18 years with his previous employers. This is said to be evidenced by a letter to that extent admitted at the trial as exhibit C. But within three months of joining the 1st appellant, the respondent said he was alleged to have committed a grave misconduct. He was then suspended and his matter was referred to the Disciplinary Committee of the 1st appellant bank. The respondent said he appeared before the committee and there he denied the allegation made against him in an unsigned anonymous petition written against him. The allegation was that he acquired for the library used and mutilated books, many of which were of no use for the Bank’s library. He said the Committee found no merit in the allegation made against him in the said anonymous petition. But while he was waiting for apologies, he received a letter of termination of his employment. The letter, dated 4th February, 1993 made the termination of the appointment to take effect from 8th May, 1992 the date on which his suspension took effect. No reason was given and no reference was made as to the outcome of the Disciplinary Committee which looked into the allegations made against the respondent and on which the suspension order imposed on the man was based. The letter of termination of appointment, admitted as exhibit R, reads, inter alia, as follows:

“Dear Sir,

Termination of Appointment

I am directed to inform you that your services are no longer required by the bank. In the circumstance, your appointment with the bank is hereby terminated with effect from 8th May, 1992. A Central Bank of Nigeria cheque No. 25516 dated 4th February, 1993 for N5,226.66 being one month salary in lieu of notice of termination of your appointment is attached herewith.

Your final entitlement from or your indebtedness to the bank is being determined and will be communicated to you in due course. Meanwhile, you are required to hand over all the bank’s property in your possession including the laminated identity and clinic cards to the Director of Research Department before you leave. Please note that as a result of the termination of your appointment you will no longer be allowed to enter the bank’s premises without official permission. Please acknowledge receipt on the copy of this letter…”

As already mentioned earlier above, the respondent had earlier been suspended from duty through a letter dated 8th May, 1992. The letter reads, inter alia, as follows:

“Dear Sir,

Suspension from duty without pay

I am directed to inform you of the bank’s decision to suspend you from duty with immediate effect. You are being suspended for your grave misconduct. However, Management’s decision on the matter will be communicated to you in due course. During the period of your suspension, you will not be allowed to enter the bank’s premises unless you are officially permitted to do so. Meanwhile, you are required to surrender your identity and clinic cards to your Director and also leave your Current address with him should there be need to contact you. Please acknowledge the receipt of this letter on the attached dispute…”

While on suspension, the respondent was invited in letter dated 22nd May, 1992 (exhibit E) to send a written statement to the Investigation Panel set up by the appellant on the allegation of purchase of old books worth N684,000. The respondent sent his defence to the allegation as requested in the letter, exhibit E. After sending his written defence, he received another letter dated 3rd June, 1992 (exhibit E2). The respondent was invited in the said letter (Exhibit E2) to appear before the Investigation Panel set up to investigate the said allegation of purchasing old books worth N684,000 on Thursday, 4th June, 1992 at 11.00 am. The respondent appeared before the panel as requested and he was cleared by the Panel. But while he was expecting a formal letter of apology and invitation to resume his duties, he was served with the aforementioned letter of termination of his appointment (exhibit R) dated 4th February, 1993 and the termination was back dated and made to take effect from 8th May, 1992, the date the suspension order imposed on him took place. As already mentioned earlier above, the respondent’s case was that he applied for the job which was advertised by the 1st appellant.

He was interviewed and was offered the job in a letter dated 5th November, 1991 (exhibit A). The letter reads thus:-

“November 5th, 1991

Dr. Victor Igwillo,

ASUTECH Library,

Enugu.

Dear Sir,

Offer of appointment

With reference to your interview for employment, I am pleased to inform you that the Central Bank of Nigeria has offered you appointment as a Deputy Librarian (Asst. Director) subject to the following conditions:-

(i) Police finger print clearance

(ii) Satisfactory reference

(iii) Successful medical report

(iv) Readiness to serve in any part of the Federation.

In order to get yourself medically examined, you should report at Royal Hospital 3, Aria Road, G.R.A., Enugu as early as possible with the enclosed letter of introduction (in duplicate).

Your appointment with the bank will be at the commencing salary of N…. (CBS 03 step 03) per annum. You will be entitled to 30 working days annual leave with leave allowance. You will also be paid housing allowance (where official accommodation is not provided), transport and utility allowance appropriate to your grade. The bank has a medical scheme under which a member of staff, his wife and dependent children are treated. Your appointment will be for a probationary period of two (2) years after which, subject to satisfactory service, you will be confirmed in your appointment. The appointment is pensionable and may be terminated upon the giving of one month’s notice in writing by either side or the payment of a month’s salary in lieu. Your service will be governed by the bank’s regulations 4th December, 1991 in force from time to time. You should in particular note the following points:-

(i) The bank will not entertain any petition in respect of post or salary offered once accepted.

(ii) Prospective employee should please note that the exigency of the service dictates their postings and as such no requests for posting of spouses to stations where their husbands/wives reside would be entertained.

If after a careful consideration of our terms, you are satisfied, you will please signify your acceptance by signing the enclosed duplicate copy of this letter and returning same to the undersigned.

As the next stage of screening, you are to report to the Manager, Recruitment Officer, for a letter of introduction to Police C.I.D Officer for your finger print exercise. You will be asked to start work once you submit all required documents. If you do not assume duty within one (1) month from the date of this letter, the offer will be regard as lapsed.

Yours faithfully,

For: Director of personnel.”

The respondent eventually accepted the offer of appointment. Although it is provided in the letter that the appointment would be for a probationary period of two years after which, subject to satisfactory service his appointment would be confirmed, the respondent contended that the position was that the 1st appellant agreed to the transfer of his service from his former employer. The respondent’s contention in this respect is premised on an exchange of correspondence between ASUTECH, his former employer, and the 1st respondent, copies of which were endorsed to the respondent. The letter from ASUTECH dated 4th December, 1991 reads as follows:-

“Our Ref: NAU/NC/P/63 4th December, 1991

Personnel Service

The Director of Personnel

Central Bank of Nigeria,

Tinubu Square, Lagos.

Transfer of service in respect of Dr. V. C. Igwillo, Deputy University Librarian

We are in receipt of a copy of your letter of appointment of the above named Senior Officer of this College as Deputy Librarian (Asst. Director). We are willing to release him if you can accept him on transfer of service. We look forward to an early reply, please. S. A. C. Obi

PAR. (Personnel)

cc: The Provost

Dr. V. C. Igwillo.”

The reply from the 1st appellant to the above letter dated 13th of December, 1991 reads as follows:

13th December, 1991

“The Registrar

College of Health Sciences

Anambra State University of Technology

Nnewi Campus,

Nigeria,

Attention: S. A. C. Obi, PAR (Personnel)

Dear Sir

Transfer of Service in respect of Dr. V. C. Igwillo, Deputy University Librarian

I write to acknowledge receipt of your reference NAC/NC/P/63 of 4th December, 1991 on the above subject matter, and to confirm to you that the Central Bank of Nigeria, Lagos is willing to accept Dr. V. C. Igwillo on transfer of service.

Yours faithfully,

A. K. Asbra

Senior Manager

Recruitment Office

For: Director of Personnel.”

It is submitted in the appellants’ brief on issue 1 that since it is clearly stated in the letter of appointment written to the respondent (exhibit A), that the appointment was for a probationary period of two years and that the appointment may be terminated upon the giving of one month’s notice or the payment of a month’s salary in lieu of notice, the 1st appellant complied with the terms of the contract with the respondent. Reference is also made to the portion of the same letter of appointment (exhibit A) which provides that the respondent’s service will be governed by the bank’s regulations in force from time to time and particularly to Clause 2 of Chapter 3 of the Regulation (exhibit U) which provides that:

“Appointment of permanent staff members can be terminated either by the staff of the bank on the giving of a month’s salary in lieu thereof.”

The step taken in the respondent’s case and communicated to him in the letter (exhibit R) to which a cheque for a month’s salary in lieu of notice was attached, is said to be quite appropriate and in line with both the contract of appointment with the respondent and the provisions of the aforementioned bank’s staff manual. It is submitted that in construing the validity or otherwise of the termination of an employment, what the court should consider are the terms of the employment vis-a-vis the letter of termination.

The decision in Katto v. CBN (1999) 6 NWLR (Pt.607) 390 is cited in support of this submission. The Court below is therefore said to have erroneously looked beyond the clear and unambiguous terms of the contract of service of the respondent in arriving at its decision now on appeal. In the appellants’ issue 2, it is submitted that since the respondent’s appointment was terminated during the period of his two year probation period, it was wrong for the court below to order that he should be reinstated. In reply to the appellants’ issue 1, it is argued in the respondent’s brief of argument that although no reason was given by the 1st appellant in its letter of termination of appointment (exhibit R), the court can in proper circumstances look beyond the letter by drawing inferences from the surrounding circumstances of the case to reach a conclusion. This is said to be what the court below did in this case and that that Court was right in doing so by virtue of the provisions of section 149 of the Evidence Act. Reference is made to the findings of fact made by the trial Court to the effect that:

“the termination cannot be divorced from the allegation of N680,000 for the purchase of books for the library.”

The court below is said to have held the same view. The appellant is however said to have failed to appeal against that concurrent findings of fact by the two lower courts. That finding of fact is therefore said not to be in dispute by the parties. It is submitted that this court should assume that the respondent’s termination was because of the allegation of fraud made against the respondent. It is also submitted that from the proved facts in this case, it is important that a person who served in a previous pensionable employment for 18 years without blemish and who because of his outstanding and distinguished service, was persuaded to join what he thought was a higher calling, should not be allowed to be disengaged so causally, especially when it is obvious that what influenced the termination was an allegation of fraud which was never proved.

The reliance by the appellants in their brief on the decisions in Katto v. CBN (1999) 6 NWLR (Pt.607) 390 and Agbo v. CBN (1996) 10 NWLR (Pt.478) 370 in support of their submission that the Court below should not have gone outside the terms of the contract to find the reason for the termination of the respondent’s appointment is said to be wrong in that the two cases are distinguishable and as such they do not apply to the present case. This is said to be because no allegation of grave misconduct was made against Katto and Agbo in both cases and as such no reason for the court to make such inference under section 149 of the Evidence Act. The reasons for the termination in those two cases are said to be strictly based on the terms of the contract, unlike in the present case. The fact that the 1st appellant initiated a disciplinary proceedings against the respondent but later abandoned the result and went on to terminate the respondent’ appointment is said to be a violation of the respondent’s constitutional right to fair hearing.

Reference is made to Specific Provisions of the Staff Manuel (exhibit U) which the 1st appellant is required to follow when taking disciplinary action against a member of staff of the bank. Thus, under section 5 of Chapter 5 of the document (exhibit U), the 1st appellant is required to suspend a staff member where a prima-facie case of serious nature has been established against him by a court or by an Investigation Committee. Also under section 6 of Chapter 5 of the same document (exhibit U), it is provided that once the 1st appellant satisfies the conditions set out in section 5 above, a Governor of the 1st appellant would then sign a suspension letter in the case of a staff member on Grade Level 12 and above, and that such suspension must not exceed one month. It is submitted that the above provisions of the Staff Manual (exhibit U) were breached by the 1st appellant in that the respondent, being an officer on Grade Level 14, the letter suspending him should have been signed by a Governor and not by an officer on the same Grade Level 14 as the respondent. Similarly, the suspension lasted for about 8 months instead of one month prescribed in the Manual and the suspension was imposed without any reference to a court or Investigation Committee. The entire exercise is therefore said to be a nullity since the steps taken by the 1st appellant were in total breach of the said provisions of the Staff Manual. The decision in Edet v. Chief of Air Staff(1994) 2 NWLR (Pt. 324) 41 at 45 is relied on in Support of this submission.

It is also argued that although the trial court held that the Assistant Personnel was directed by the Governor to sign -the letter of suspension, the court below is said to have overruled that view of the trial Court and there is said to be no appeal against that point. The appellants are therefore said to have accepted the said overruling made by the court below and as such that cannot now be reopened. The contention of the 1st appellant that the respondent’s service with his previous employer had not been transferred to the 1st appellant is the one taken up in the respondent’s issue 2. Reference is made to the exchange of letters between the respondent’s former employer, ASUTECH and the 1st appellant already reproduced above (exhibits 1 and 2A respectively). This was followed by the fact that the respondent’s former employer had also sent to the 1st appellant under a covering letter dated 15th January, 1992 (exhibit 2) the record of service of the respondent. It is then submitted that the Court below was right in holding that there had been an effective transfer of the respondent’s services from the ASUTECH to the 1st appellant. The contention that the respondent was under probation is therefore said to be totally erroneous and inapplicable to the respondent whose 18 years service with his former employer had been transferred to the 1st appellant. The facts of this case, as summarized above, seem not to be disputed by the parties. What is in dispute is whether the Court below was right in taking into consideration other evidence led by the respondent to show that the motives behind the termination of his appointment were in fact based on the unsigned anonymous petition written against him and whether the Court below was right in ordering the respondent’s reinstatement. The law is settled that there are now roughly three categories of contracts of employment viz: (a) those regarded as purely master and servant; (b) those where a servant is said to hold an office at the pleasure of the employer: and (c) those where the employment is regulated or governed by statute, often referred to as having statutory flavour. See Olaniyan v. University of Lagos (1985) 2 NWLR (Pt.9) 599.

An employment is said to have a statutory flavour when the appointment is protected by statute or laid down regulations made to govern the procedure for employment and discipline of an employee. Any other employment outside that category is governed by the terms under which the parties agreed to be master and servant. See Olaniyan v. Unversity of Lagos, supra; Ogunke v. National Steel Development Authority (1974) NMLR 128; Fakuade v. O.A. U.T.H. (1993) 5 NWLR (Pt.291) 47; ldeh v.University of Ilorin (1994) 3 NWLR (Pt.330) 81; Shitta-Bey v. The Federal Public Service Commission (1981) 1 S.C. 40, Imoloame.v. WAEC (1992) 9 NWLR (Pt.265) 303; and Udo v. Cross River State Newspaper Corporation (2001) 14 NWLR (Pt.732) 116.

Where an employee’s service is protected by statute and his employment is wrongfully terminated, he would be entitled to re-instatement in his office and in addition, damages representing his salaries during the period of his purported dismissal: See Shitta-Bey v. The Federal Public Service Commission, supra;Olaniyan v. University of Lagos, supra; and Udo v. Cross River State Newspaper Corporation, supra. This court clearly stated the legal position of public servants in Nigeria in the Olaniyan v. University of Lagos case, supra. It is that public servants in the established and pensionable cadre of the Federal Government Service do not hold their offices at the pleasure of the Federal Government. Rather, their appointments are based upon rules and regulations, statutes or memoranda of appointment. It was also clearly stated in the same case that the University of Lagos and the University Council, both being creatures of statute, cannot act except within and under the powers conferred on them by the relevant statute. The facts in the instant case, as already set out above are that the 1st appellant is a Federal financial institution created by statute.

It follows, therefore, that both the bank and officials acting on its behalf cannot act except within and under the powers conferred on them by the relevant statute. Any action taken outside the powers conferred by the statute or regulations made thereof will be ultra vires, null and void.

The respondent in the instant case applied for the post in response to the advertisement published in the newspapers by the 1st appellant. He was interviewed and offered the job as per the letter of appointment dated 5th November, 1991 (exhibit A). A copy of his letter of appointment was sent to his then employer, ASUTECH, where the respondent had served for 18 years.

ASUTECH wrote to the 1st appellant that it would release the respondent only if the appellant agreed to accept the respondent on transfer of service. The letter dated 4th December, 1991 is exhibit 1. The 1st appellant’s reply dated 13th December, 1991 (exhibit 2A) was that it was willing to accept the respondent on transfer of service. It can be assumed that the respondent was released by ASUTECH to report for duty at the 1st appellant on receipt of the 1st appellant’s letter, exhibit 2A. He in fact assumed duty on 16th January, 1992. The record of service was sent by ASUTECH to the 1st respondent under a covering letter dated 15th January, 1992. The contention of the appellants, therefore, that the respondent was to be on probation for a period of two years as contained in the letter of offer (exhibit A) can definitely not stand. I believe and hold that that condition had been varied by the aforementioned exchange of letters. Again, as I already stated above, the 1st appellant is a Federal institution created by statute. It follows therefore that it must carry out its activities in line with its governing laws. The laws regulating the appointment and discipline of its workers must be complied with strictly as their employments are with statutory flavour. Every action taken on behalf of the 1st appellant is therefore expected to be done in good faith, free of bias, or nepotism. Similarly, every provision of the Banks Staff Manual (exhibit U) must be strictly complied with by the bank when dealing with every member of its staff. Thus, in the instant case, section 5 of Chapter 5 of the said Staff Manual (exhibit U) provides that the 1st appellant is required to suspend a staff member only where a prima facie case of a serious nature has been established against the staff member by a court or by an Investigation Committee. This provision was breached in the respondent’s case. The letter suspending him without pay dated 8th May, 1992 was issued when it was not shown that a prima facie case of a serious nature was established against the respondent by a court or an Investigation Committee. It was after he had been suspended that the 1st appellant decided to refer the matter to the Investigation Committee. The said Investigation Committee’s first contact with the respondent was through a letter dated 22nd May, 1992 in ‘which the respondent was invited to send a written defense to the allegations made against him in the unsigned anonymous petition. The respondent sent his reply as requested. Another letter (exhibit E2) was again written to him. He was in that letter elated 3rd June, 1992 invited to appear before the Investigation Committee on 4th June, 1992. The respondent appeared before the said Committee on that day as required in the letter. He was on that day cleared by the Committee or the allegations made in the said petition against him. It was after the above scenario that the 1st appellant now turned round to write its letter of termination of the respondent’s appointment which was backdated to the date that his suspension took effect and to which a cheque for one month’s salary said to be in lieu of notice was attached. It may also be mentioned that section 6 of Chapter 5 of the Staff Manual provides that the letter of suspension in cases of officers on Grade Level 12 and above must be issued and signed by the Governor and that such suspension should not last for more than one month. That provision was also breached in that the letter in question was signed by an officer on Grade Level 14 as the respondent and not by the Governor and the suspension lasted for eight months instead of the maximum of one month prescribed in the Staff Manual.

The effect of the breaches of the aforementioned provisions of the Staff Manual is that the suspension order imposed on the respondent was null and void and of no effect. Similarly, the decision to terminate the respondent’s appointment and treat his case as that of a new recruit was made in bad faith and in utmost disregard of the evidence proved in the respondent’s case.

The respondent pleaded and led evidence to the effect that the 2nd appellant was the mastermind against the mischief against him. The man did not testify at the hearing. The serious allegation was therefore not controverted. It must be made abundantly clear that the 1st appellant is a Federal institution constituted and regulated by statute. Every member of staff is expected to carry out his function in accordance with the law that set up the institution. In the result, I hold that there is no merit in the appeal. As I have stated above, the respondent’s employment is one with statutory flavour. Where, therefore a case of wrongful termination of such appointment is made out, as in this case, the correct order to be made is one reinstating him. But the man is now dead. He died while this appeal was pending in this court and his widow was substituted to continue with the defence of the appeal. An order reinstating him to his post can therefore not be made. In that case, the order of court below:

(1) the order for reinstatement of the respondent made by the court below is affirmed and remained effective till the respondent’s death on 18th July, 2002.

(2)The sum of N20,112,400 shall be paid to the respondent being arrears of salary and allowances from the date of his suspension on 8th May, 1992 up to September, 2000 based on the calculations set out in paragraph 14 of the counter affidavit deposed to and filed in respect of the appellants’ motion for stay of execution filed at the court below on 21st September, 2000 and which the said court ordered to be deposited in an interest yielding separate account in the 1st appellant’s bank in its ruling on the motion for stay dated 22nd May, 2001 together with the interest that has accrued on the said amount.

(3) Arrears of salary and allowances from September, 2000 up to 18th July, 2002 when the respondent died based on the same principle adopted in arriving at the amount specified in the said paragraph 14 of the same counter affidavit is also to be paid to the respondent.

(4) Also to be paid to the respondent is all entitlements due to an officer of the respondent’s rank who dies in office. The respondent is entitled to costs at the High court assessed at N8,000; costs in the Court of Appeal assessed at N8,000 and N10,000 in this Court.

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SC.83/2002