Central Bank Of Nigeria V. Jacob Oladele Amao & 2 Ors (2010)

LAWGLOBAL HUB Lead Judgment Report

WALTER SAMUEL NKANU ONNOGHEN, JSC

This is an appeal against the judgment of the Court of Appeal, Holden at Lagos in appeal No. CA/L/461/2000 delivered on the 5th day of December, 2006 dismissing the appeal of the appellant against the judgment of the Federal High Court, Holden at Lagos in Suit No. FHC/L/CS/524/1999 delivered on the 22nd day of May, 2000 in favour of the plaintiffs, now, respondents in this Court.

The respondents were former employees of the appellant who instituted the action seeking the following reliefs:-

1. An order of mandamus directed to the respondent directing it to pay to the applicants forthwith all accrued pensions calculated with effect from 7th January, 1997 on emoluments currently earned by their serving counterparts as prescribed under the Federal Government Policy on Harmonisation of Pensions and subsequently all such pensions as and when due.
2. A declaration that on a true construction of (a) Federal Government While Paper Ref No. AFNC/86/2/376 dated 7th October, 1997, (b) Federal Government Circulars Ref No. 136321/S/T3/105 dated 30th January, 1997 and B3216/s.IIT3/124 dated 7th January, 1998 the appellants are entitled under the Federal Government Policy on Harmonisation of Pensions to payment of such pensions as are based with effect from 7th January, 1997 on emoluments currently earned by their serving counterparts.
3. A declaration that the respondents’ decision to pay the applicants pensions on the basis of “affordability and sustainability” is ultra vires, null and void.
4. An order of mandamus directing the respondent to pay the applicants forthwith all accrued pensions calculated with effect from 1st January, 1997 on emoluments currently earned by their serving counterparts as prescribed under the Federal Government Policy on Harmonisation of Pensions aforesaid and subsequently all such pensions as and when they fall due.

Further and in the alternative to 4 above, an order of mandatory injunction compelling the respondent to pay the applicants forthwith all accrued pensions calculated as described and subsequently all such pensions as and when they fall due.”

The respondents’ employment was made pursuant to section 14(3) of the Central Bank of Nigeria Decree No. 24 of 1991 while the terms and conditions of their employment are as contained in the staff Manual of the Central Bank of Nigeria made pursuant to the aforesaid section 14(3) of Decree 24 of 1991. All the respondents retired from the service of the appellant before 1991 and were being paid their pension as prescribed by the Board of the Central Bank of Nigeria, the appellant herein.

However, in 1997 the Federal Government of Nigeria issued two circulars and a White Paper thereon in which the said government directed that statutory bodies, including the appellant, should comply with the White Paper and the circulars on Harmonisation of Pension Policy as a result of which the respondents initiated correspondence with the appellants on the issue demanding payment of their pension in accordance with the provisions of the White Paper and the said Circulars. The White Paper and two circulars are exhibits JAJ1; JAJ2 and JAJ3 respectively – see pages 47 – 57 of the record. The above exhibits were the Federal Government’s reaction to the report of the Review Panel on Civil Service Reforms which directed the harmonization of pensions of officers who retired before 17 January, 1991, which were based on their basic salaries only, in line with the pensions of officers who retired thereafter, which were based on their basic salaries and certain approved allowances so as to ensure equality and uniformity of payment of pension to such retired officers who retired on the same salary grade, irrespective of their dates of retirement, with effect from 1st January, 1991 and that the said pensions should continue to be reviewed upwards immediately salaries and allowances are reviewed.

Following the correspondence between the parties, the appellant, by exhibit JAJ6 dated 31st July, 1997, informed the respondents inter alia:

“Let me assure you that immediately we receive the relevant documents from Government the Bank would implement the harmonized pensions with utmost dispatch.”

However by a letter dated 12th March, 1998, following further correspondence between the parties, the appellant informed the respondents, inter alia:

“Following the government policy on the harmonization of pensions and the subsequent release of a circular on same, the Bank has examined the implications of implementing the guidelines and has approved the harmonized pension against the background of afford ability and sustainability of the pensions fund over the years.” – See exhibit JAJII at page 60 of the record.

The respondents however, continued to press for implementation of the harmonized pension as approved supra to no avail resulting in the institution of the action, the reliefs of which had earlier been reproduced in this judgment.

At the conclusion of arguments, the learned trial Judge entered judgment in favour of the respondents holding in effect that:

1. The appellant had not withdrawn its admission as contained in exhibit JAJ6 of its willingness to comply, with the provisions of exhibits JAJ1; JAJ2 and JAJ3.

(b) That the action is not statute barred as the special defence ought to have been raised at the commencement of argument on the matter and that, in any event, the said contention is erroneous because pensions are of recurrent nature as a result of which the cause of action relating thereto arises a fresh every month when the appellant pays the respondents less than their full harmonized entitlement.

It is the appeal against the above decision that was dismissed by the lower court resulting in the instant further appeal to this Court, the issues for the determination of which have been formulated by the learned senior counsel for the appellant, B. ALUKO – OLOKUN SAN, in the appellant’s brief of argument filed on the 26th day of July, 2007 as follows:-