Eze Okorocha V. United Bank For Africa Plc & Ors (2018)

LAWGLOBAL HUB Lead Judgment Report

AMIRU SANUSI, J.S.C.

This appeal is against the judgment of Court of Appeal, Lagos division (the lower Court or Court below) delivered on 11th day of May, 2010 which had affirmed the Judgment of the Investment And Securities Tribunal (hereinafter referred to as “the Tribunal”) delivered on 30th September, 2008 at Lagos. In its Judgment now appealed against, the lower Court dismissed the appeal of the appellant and also struck out an application filed by the appellant/applicant for want of jurisdiction to entertain the application filed against the 1st to 4th respondents herein, as tribunal of first instance with regard to the 5th Respondent. The lower Court held that consequent upon its striking out the application of the appellant for want of jurisdiction, the action against the 5th Respondent which emanated as a result of the alleged default of the 1st to 4th Respondents, the action could no longer be sustained or stand.

Before dealing with the issues raised by learned counsel of the parties, My lords please permit me to give brief summary of the facts which gave rise to this appeal in the first Place.

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The appellant as applicant approached the Tribunal with an application seeking some declaratory and injunctive reliefs which include the followings:-

1. A declaration that the Respondents are mandated under the Laws and Rules to complete and or ensure that all allotments of the 1st Respondent’s public offer of March 2007 are received by subscribers not later than six weeks after close of the offer and or within the period extended by the 5th Respondent and that they have since failed and neglected in that regard.
2. A declaration that the 1st Respondent breached its contract with the Applicant as per the Applicant’s subscription for the 1st Respondent’s shares at the prescribed time for allotment of the Applicant’s said shares
3. A declaration that the delivery of the Applicant’s share certificate to him on the 1st February 2008 on the said offer was done late and in disregard of the stipulated Rules and guiding Regulations and as a result, the Applicant has suffered damages.
4. An order of mandatory injunction, directing the 1st, 2nd and 3rd Respondents to immediately comply with the Regulations of the Investment and

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Securities Act of 1999.

5. An Order restraining the 1st, 2nd, 3rd and 4th Respondents from issuing any share to the members of the public or participating in any public issue to the public, except in accordance with the provisions of the law and Rules and Regulations
6. The sum of N15,000,000= (Fifteen Million Naira Only), as general damages for loss of revenue and opportunity cost of the Applicant’s investment with the 1st Respondent
7. The sum of #7,000,000= (Seven Million Naira) as exemplary damages against the 1st to 4th Respondents
8. The sum of N2,000,000= (Two Million Naira) as special damages against the 1st, 2nd, 3rd and 4th Respondents on account of the Applicant’s legal cost and other incidental expenses
9. An order compelling the Securities and Exchange Commission to Sanction the Respondents for breach of the Investments and Securities Act and the Securities Act and Securities and Exchange Commission Rules and Regulations made pursuant to the Act.

The 1st Respondent had on 23rd of February 2001, advertised for the subscription of its shares and paid the shares of 2,000,000 at N35 per share through the agents of

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the 1st Respondent. After waiting for the shares, the appellant was not issued with the share certificate. The appellant thereafter filed an Originating Application against the respondents. Pleadings were filed and exchanged, but the Tribunal suo motu raised issue of jurisdiction to entertain the claim and invited parties to address it and later in its ruling of 30th April 2008, it held that it lacked jurisdiction to entertain the matter and also ruled that the Appellant had not taken step by complaining to the Securities and Exchange Commission.

Dissatisfied with the decision of the Tribunal, the appellant unsuccessfully appealed to the Court below, hence this further appeal to the Supreme Court.

In arguing this appeal the learned counsel for the appellant in his Amended Brief of Argument formulated two issues for determination as argued below.

ISSUE NO 1

Issue no 1 whether the Court below gave a proper interpretation of Section queries whether 284(1)(a) (3) of the Investment and Securities Act 2007 to the effect that the Investment and Securities commission lacks jurisdiction to entertain the appellant’s claims since the

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appellant’s claims did not arise from the decision of the 5th respondent.

The learned counsel to the appellant contended that the tribunal ought not to decline jurisdiction to entertain the appellant’s claim as this is against the rule of natural justice rooted in the pillars of justice, namely, audi atteram parten and nemo judere en cause sua. He submitted that fair hearing is an indispensible requirement of justice in any adjudicatory process. He cited the case of ORUGBO V UNA (2002) 9-10 SC 61 at 93-93.

He argued that the interpretation placed by the Court below on the provisions of Section 284 (1)(a) (iii) of the Investment and Security Act 2007 is restrictive and in a gross violation of fundamental principle of natural Justice entrenched in the Constitution. He contended that the 5th Respondent against who the appellant has complained, is a necessary and principal party and that it is not right to submit the complaint of the appellant to the 5th respondent, as doing so, would have been in gross violation and abuse of fundamental principle of fair hearing as the adjudicator would no longer be independent and impartial.

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He argued that while it may be conceded that the jurisdiction of Investment and Securities Tribunal to entertain the claims of the appellant as it affects the 2nd – 4th respondents may be conclusive, he then submitted same could be proper in relation to the claim of the appellant against the 1st and 5th Respondents as they are not persons contemplated under Section 284(1)(a) of the Act.

He submitted that the whole statute must be read together in interpretation of a statute. He cited the case of IBRAHIM V MOHAMMED (2003) 2 SC 127 at 183. He contended that the Court below interpreted the provision of Section 284 (1)(a)(iii) of the Investment and Security Act in isolation without reflecting on the facts and circumstance giving rise to this case. He argued that had the Court construed the provision of Section 284 Investment and Security Act as a whole, it would have appreciated that the Jurisdiction of the Tribunal to hear and determine the claim of the appellant is saved under Section 284 (1)(c) and (d) of the Act. He submitted that where a party institutes an action at the Tribunal, without first going to the Securities and Exchange Commission, the

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action remains valid as to hold otherwise will lead to an absurd interpretation which will eventually result in disregard and breach of the 1999 Constitution.

ISSUE No 2

Issue no 2 deals with the question whether on a proper interpretation of Section 284(1)(a) and (3) 2007, the Court below was right in holding that the Tribunal was right in declining Jurisdiction.

On this issue, the learned appellant’s counsel submitted with respect to Section 284 (1)(a), that the Securities and Exchange Commission lacks the Jurisdiction to determine questions of law or dispute involving regulatory governance of the operations in the capital market when the Commission itself is the regulatory body, saddled with responsibility of regulating market operation in the securities market. He then urged the Court to resolve this issue in favour of the appellant and allow the appeal.

In response to the argument of counsel for the appellant, the learned counsel for the respondent distilled two issues for determination

ISSUE A

Issue A deals with whether the Court below was right in dismissing the appellant’s appeal.

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Here the learned counsel to the 1st – 4th Respondents submitted that the provisions of Section 284 (1)(a) I-IV of the Investment and Security Act 2007 construed by the Court below in arriving at its decision that the Tribunal was right in declining Jurisdiction did not offend any of the rules of natural Justice and or the provisions of Section 36 (1) of the 1999 Constitution. He submitted that the question of Jurisdiction of the trial Court is statutory and that same was aptly provided for by Section 284 (1) (a), (b), (c) (d) (e) (f) (2)(3) of the Investment and Securities Act 2007. He submitted that the Jurisdiction of the Tribunal to hear and determine the claim of the appellant against 1st – 4th Respondents was subject to a decision of the 5th respondent and that it is in consonance with the provisions of Section 284 (1) (a) of I. S. A. He argued that the claim against the 5th Respondent was to condemn the respondents for breach of I.S.A and Securities and Exchange Commission Rules and Regulations made pursuant to the Act. He therefore submitted that by appellant’s claim against the 5th Respondent, no wrong whatsoever was alleged against the 5th respondent and

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the question of likelihood of bias on the part of the 5th Respondent in determination of any complaint that may by lodged with the 5th Respondent, does not arise. He submitted that the Court below was right in holding that the tribunal lacked the requisite jurisdiction to determine the appellant’s claim against the 1st – 4th Respondents in the absence of a decision by the 5th Respondent as provided for by Section 284 (1)(a) of I. S. A. He urged this Court to resolve this issue in favour of the respondents

ISSUE B

Issue B deals with whether having held that the trial Tribunal had Jurisdiction to entertain the application against the 5th respondent alone under Section 284 (1)(d) I. S. A the lower Court was right in holding that the action against the 5th Respondents could not be sustained without joining the 1st – 4th Respondents.

The learned counsel for the 1st – 4th Respondents submitted that the Court predicated its reasoning as it relates to the 5th respondent on well trite and a fundamental principle of law, that in a declaratory action, all persons who have interest will be or who are likely to be affected, should be joined as parties to the action. He then

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urged the Court to resolve this issue in favour of the appellant and dismiss the appeal.

The 5th respondent’s counsel also distilled two issues for determination of the appeal.

ISSUE No 1

This issue deals with whether the Court below was right in upholding the decision of the tribunal in declining Jurisdiction to hear the appellants originating application. He also stated that it is clear from the originating application of the appellant, cantered that the appellants application is on the 1st – 4th respondents as parties to the public offer and their failure to issue the appellant with share certificate. He therefore submitted that by the provisions of Section 284 (1)(a)(b) – (iv) of Investment and Securities Act, before the Tribunal would have Jurisdiction in respect of any matter provided thereunder, there must first have been a decision by the Securities Commission which is not the position of all here. He then urged the Court to resolve this issue in favour the respondents.

ISSUE II

Issue no II deals with whether having held that the tribunal has Jurisdiction to entertain the appellant’s application

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against the 5th Respondent alone under Section 284 (1)(d) I. S. A, 2007, the Court of Appeal was right in holding that the action against 5th Respondent could be maintained.

The learned counsel for the 5th Respondent submitted further, that 1st – 4th respondents are not only primary parties but also necessary parties to the appellant’s action the absence of why the proceedings between the appellant and the 5th respondent could not fairly be dealt with on the issue of neme Judere in cause suo. He submitted that the issue did not arise from the Judgment of the Court of appeal and therefore it was misconceived. He then urged this Court to resolve the issue in favour of the Respondents and dismiss the appeal.

REPLY OF THE APPELLANT

The 1st point in the Reply Brief revolves under the Interpretation of Section 248 (1)(a) of the Investment and Securities Act.

On the issue of cause of action, he argued that the failure to issue the appellant his share certificate within the statory period, constitutes a cause of action against the 1st 4th and 5th Respondents. He submitted also that even if there is no reasonable cause of action disclosed

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against the 5th Respondent, the law is now settled that a declaratory relief can be granted even where there is no cause of action. He cited the case of IKINE V EDJERODE (2001) 18 NWLR (pt 745) page 446 482.

The learned counsel then submitted that even if that it is true that no cause of action has been disclosed against the 5th respondent by the appellant, the relief of declaration can still be made against the 5th respondent. He urged the Court to allow the appeal

It is to be noted that 5th Respondent also filed Brief of argument on 22/5/2014 and also raised for determination therein, two issues which are similar to the ones raised in the Amended 1st to 4th Respondents Brief. It will amount to repetition to reproduce their here as the argument preferred on them.

It is pertinent for say at this juncture, that the learned counsel to the 1st to 4th respondents had, on 11/10/2010 filed a Notice of preliminary Objection pursuant to Order 2 Rule 9 (1) of Supreme Court Rules which he adopted at the hearing of this appeal. Suffice it to say, that the said Preliminary Objection was argued by him in his Amended

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Brief of the 1st to 4th Respondents and the argument on same was covered by the two issues for determination of the appeal raised in the said amended brief of argument. The Preliminary Objection was principally predicated on three grounds as reproduced hereunder:-

1. That the grounds of appeal contained in the Notice appeal did not arise from and is not a challenge to the Judgment of the lower Court now appealed against.
2. That the party named as the 1st Respondent in the Notice of appeal is distinct from the 1st Respondent in the Judgment of the lower Court now appealed against.
3. That the appeal in which grounds 3 of the Notice thereof is predicated upon are of question of fact which was initiated without the leave of either the Court of Appeal or the Supreme Court contrary to the mandatory provisions of Section 233 (3) of the Constitution of the Federal Republic of Nigeria 1999.

It is settled law, that Preliminary objection where raised by a party, should firstly be determined before determining the substantive appeal if the need to do so arises. I shall in that regard, therefore first of all consider arguments on the Preliminary objection.

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On the first two issues for determination in the 1st to 4th Respondents amended brief. I shall consider it with the Preliminary objection of the 5th Respondent simultaneously, since they are similar and were also argued in the two issues which are similar to the corresponding two issues as argued in the Amended Brief of argument of the 1st to 4th Respondents which also represent their responses to the issues raised the Amended Appellant’s brief of argument.

It is submitted by the learned counsel for the 1st to 4th Respondents, that the grounds of appeal in the Appellants Amended Notice of appeal did not constitute a challenge to the Judgment of the lower Court. He also argued that the Judgment of the Court below drew distinction between the Jurisdiction of Trial tribunal in relation to the clams against 1st to 4th Respondents and the question of the Jurisdiction of the trial tribunal in relation to the 5th Respondent and the ultimate question whether the action against the 5th Respondent could be sentimental before the tribunal.

To the learned counsel for the appellants, the issues are the same because the point revolves on whether the trial

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tribunal was right on declining Jurisdiction and the subsequent endorsement of that funding by the lower Court. I think there is merit on that argument posed by the appellant. The crux of the matter, in my view, revolves on the issue of Jurisdiction as decided by the lower Court and the two sets issues on Jurisdiction are interwoven between the Jurisdiction of the tribunal and that of the lower Court which both were pronounced on by the Court below. To my mind therefore, it will not be correct to say that Ground No 1 which raised the issue of Jurisdiction, was not covered by the Judgment of the lower Court now being appealed against, since issue of Jurisdiction is very wide, especially when one considers the entire circumstances of this instant appeal. The point raised on the 1st ground is therefore not well taken and is rejected.

On the 2nd ground of appeal, the Objectionor argued that Ground No.2 was not borne out of the decision of the lower Court. It is perhaps apt to point out here, that the issue of jurisdiction must always be pronounced upon in a judgment before it can be raised on appeal. The matter or issue of jurisdiction can be raised at any time even before

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an appellate Court even if it was not raised or determined at the trial, intermediate or appellate Court, provided the procedure of raising it was properly followed by the party choosing to raise it. It needs not always be an attack on the aspect covered explicitly in the judgment.

It can be freshly raised on appeal once the subject matter or the statute donating jurisdiction to the trial Court to adjudicate on the issues did not give the Court such jurisdictional power to so adjudicate on, or if any of the parties to the suit who is a necessary party was included or not included in the suit. That is why issue of jurisdiction is most of the time raised as a fresh issue in appeal with or even without leave of the appellate Court. In the result, the two preliminary objections lacks substance and are accordingly dismissed. I shall now proceed to consider the main appeal.

As I posited above, the two issues raised in the respondents brief of argument had caused Reply to these issues to be raised in the Appellant’s Amended Reply brief of argument.

I shall therefore be guided by the Amended 1st to 4th Respondent’s brief of argument which as I had earlier

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stated, covers the brief of argument filed by the 5th Respondent which is similar virtually in all respects. Moreover, the two issues raised in the 1st to 4th Respondents Amended Brief of Argument relates to the question of jurisdiction and it is trite law that jurisdiction is the lifewire of any case and is a thresh-hold which is so fundamental that any decision reached by any Court of law no matter how superb, beautiful, or sound such case, it is a nullity once such trial Court or tribunal or appellate Court lacks jurisdiction to determine or adjudicate on the matter or appeal.

It is settled law, also that jurisdiction is often donated to the Court by statute.

It would seem to me that the case at hand, before the trial tribunal revolves on the provisions of Section 284(1) of the Investment and Securities Act 2007. The trial tribunal in its ruling delivered on 30th April 2008, after considering the above mentioned provisions held that it lacked jurisdiction to entertain the matter submitted before it for adjudication.

The tribunal further held that the appellant (i.e the applicant herein) by the provision of the Act should first of

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all, have complained to the Commission before approaching it. It further held that although the applicants had joined the Commission as a respondent, it was doubtful if there was a real triable issue between the applicant and the Commission.

On appeal to the lower Court, the lower Court, inter alia, held that the lower tribunal lacked the power or vires to entertain the action against the 1st to 4th Respondents since the action against the 5th Respondent could not be sustained because no valid order could be made by the lower tribunal against it without joining the 1st to 4th Respondents. I find myself to be in entire agreement with the position of the lower Court as postulated above, because it is trite and well settled law too, that in any declaratory relief sought by a party, it is incumbent upon that party to join all persons/parties whose interest is at stake or who will be directly affected or likely to be affected in the action. It is only if that has been done, that the Court being approached to make such declaratory order, would have the power to entertain and determine the action and could comfortably grant or refuse such order to the parties

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affected or concerned. I am convinced and I am also at one with the finding of the lower Court, when it held that the tribunal lacked the requisite jurisdiction to determine the appellant’s claim before it against the 1st to 4th Respondents since there was no decision or determination by the Commission i.e the 5th Respondent. Hence, the trial tribunal is devoid of jurisdiction or competence to entertain or determine the appellant’s/applicant’s) claim against the 1st to 4th Respondents, in view of the fact that the 5th Respondent did not pass any decision being challenged before it, as contemplated by the provisions of Section 284(1)(a)(i-iv) of the Investment and Securities Act 2007. The two issues encapsulated in the 1st to 4th Respondent’s brief, which also covered all the issues raised in the 5th Respondent’s Brief of argument, are hereby resolved in favour of all the respondents and against the appellant herein.

In the result, in the light of all that I have posited above, I adjudge this appeal as unmeritorious. It fails and is accordingly dismissed by me. As a corollary, I affirm the judgment of the lower Court. I make no order as to costs, so parties should bear their respective costs.

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SC.323/2010