Ini Okon Udo Utuk V. The Liquidator (Utuks Construction Marketing Co. Ltd.) Anor (2009)
LawGlobal-Hub Lead Judgment Report
JEAN OMOKRI, J.C.A.
This is an appeal by the appellant against part of the ruling of A, Abdu- Kafarati of the Federal High Court, Calabar, in Suit No. FHC/CA/M1/93 delivered on 23/5/95.
The brief facts of the case on appeal are as follows: The 1st respondent as the Liquidator and official Receiver filed a motion dated 6/1/95, seeking for an order declaring’ the advertisement and sale of the properties of Utuks Construction and Marketing Co. Ltd. void, which properties were sold on Public Auction by one Ben Ekpo & Company of No. 58, Iboko Street, Uyo, the .Auctioneer to Mercantile Bank Plc. The properties are:
- No. 45, Ekpanya Street, Uyo.
- No. 50 NEPA Line, Uyo.
- Two (2) number Storey Buildings along Ekprii Nsukara Road, Uyo.
- No. 44 Brooks Street, Uyo.
The said motion also sought for an order vesting the above named properties in the custody of the 1st respondent, who was for the provisional Liquidator.
The appellant in this appeal filed an affidavit in support of the 1st respondent’s motion together with some exhibits marked Exhibits A, A 1 and A2. Utuks Construction and Marketing Company ltd. filed a counter-affidavit through one Engr. Bassey Okon, the Secretary of the Company.
The 2nd respondent, who is the purchaser of the properties, the subject of this appeal also filed a counter-affidavit in opposition to the application filed by the 1st respondent. After hearing the submissions of the respondent’s counsel to the parties, the court in its ruling delivered on 23/5/95 set aside the sale of the property at 44 Brooks Street, Uyo, as being void and upheld the sale of the properties at:
(a) No. 45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) Two (2) number Storey Buildings along Ekprii Nsukara Road, Uyo.
Dissatisfied with the Ruling and Orders of the trial court, the appellant appealed to this court on two grounds. The grounds of appeal are as follows:
“GROUNDS OF APPEAL
- That the learned trial judge erred in law in failing to make any findings of fact as to whether the sales carried out by the auctioneers appointed by Mercantile Bank of Nigeria Plc. during the pendency of the winding up proceedings were valid sales.
Particulars of Error
(a) The learned trial judge did not advert his mind to the issues of law canvassed by the parties in their affidavit evidence.
(b) The provisions of Sections 413 and 414 of the Companies and Allied Matters Decree, 1990, are mandatory and are in no way subject to the consent, or otherwise of the parties to the transaction.
(c) The learned trial judge failed to call for oral ‘evidence in the face of contentious issues raised by the parties in their affidavit.
GROUND 2
That the learned trial judge erred in law in not holding the sales of the properties situate at:
(a) No. 45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) Two (2) number Storey Buildings along Ekpiri Nsukara Road, Uyo, to be void.
Particulars of Error
(a) The petition for the winding up of Utuks Construction and Marketing Company Limited was instituted on the 12th day of February, 1993 and the advertisement for the sale of the Company’s property appeared in the Nigerian Tide of Saturday, the 12th day of November, 1993.
(b) The auctioneer did not effect the sales under the directions of any court of law in accordance with Section 500( 1) and 500( 1) (b) of the Companies and Allied Matters Decree, 1990.
(c) The learned trial judge erroneously held that because there was no argument against the sales of the said properties, the sales were therefore valid.”
The appellant in his brief dated 26/4/96 and filed on 11/1/01, formulated 4 issues from the two grounds of appeal filed. The issues are:
“(i) Whether the learned trial judge was right in declaring the sales of the properties situate at
(a) NO.45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) 2 Storey Buildings along Ekpiri Nsukara Road, Uyo, valid when there was abundant affidavit evidence that the Auctioneers purported to sell the properties during the pendency of the winding up proceedings and without regard to the provisions of Sections 413, 414, 500(1) and 500(1) (b) of the Companies and Allied Matters Decree and which evidence were not countered.
(ii) Whether it was right for the learned trial judge to hold in his findings of fact that the counsel for the applicant and the petitioner had no problems with the sales of the properties situate at
a) No. 45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) 2 Storey Buildings along Ekpiri Nsukara Road, Uyo, in so far as they did not present any argument against the sales and that the sales were therefore valid.
(iii) Whether the trial judge was right in his approach and consideration of the evidence in relation to the prayers before him.
(iv) Whether the setting aside of the sales of No. 44 Brooks Street, Uyo did not constitute d repudiation of the purported Auction Sales of the properties which were alleged to have been sold on block to Petfi Nigeria Limited.”
The 1st respondent in its brief dated 9/3/04 and filed the same day distilled only one issue from the two grounds of appeal filed by the appellant. The lone issue for determination is as follows:
“Whether the trial Judge was right in affirming the validity of the sale of properties at No. 45, Ekpanya Street, Uyo, No: 50, NEPA Line, Uyo and 2 (two) Storey Buildings -along Ekpiri Nsukara Road, Uyo properties of a company in liquidation which were sold during the pendency of the winding up proceedings.”
The 2nd respondent in its amended brief dated and filed on 5/11/07 raised 4 issues from the two grounds of appeal filed by the appellant. The issues raised by the 2nd respondent are as follows:
“(i) Whether the learned trial Judge made a correct approach to the affidavit, documentary and oral arguments adduced by all the parties in this case?
(ii) Whether the sale of the Company properties during the pendency of the winding up proceeding, without more, rendered the sale void?
(iii) Whether the setting aside of the sale of properties at No. 44 Brooks Street, Uyo, out of the four properties to be sold, amounted to a repudiation of the whole sale.
(iv) Whether Trust House Properties Limited now in possession of the said properties by a later deed of re-assignment, is not entitled to the said properties as an innocent purchaser for value without notice?”
At the hearing of the appeal, the appellant, even though served was absent from court. Pursuant to Order 17 Rule 9(4) of the Court of Appeal Rules, 2007, the appeal was treated as having been duly argued.
The appellant contended in his brief, that the trial Judge came to a wrong conclusion in declaring the sales of the said properties valid when the applicant had clearly directed the mind of the learned trial Judge to the provisions of Companies and Allied Matters Act, namely, that the disposition of the properties were done during ,the pendency of the petition for winding up of the company, that is between November 1993 and October 1994, whereas the petition for winding up was instituted on 11/2/93. The appellant opined that by virtue of section 415(2) of CAMA, it is the law that the winding up of a company shall be deemed to commence at the time of the presentation of the petition for the winding up. The appellant pointed out that the Provisional Liquidator was appointed on 21/10/94. In the interim, the appellant had sought for and obtained leave of the trial court to cause-the petition to be advertised in the Federal Gazette and in one National Newspapers and in Local Newspaper published in Akwa Ibom State. The notice which appeared in the Federal Gazette on 28/2/94 was a notice of the winding up petition to the whole world. Both the auctioneer, Messrs Ben O. Ekpo and Company and the 2nd respondent are legally bound by the said notice. The appellant also contended that the Provisional Liquidator in paragraphs 8, 9, 10 and 11 of his supporting affidavit that the properties in question which were allegedly mortgaged to Mercantile Bank of Nig. Plc. were sold to the 2nd respondent during the pendency of the winding up proceedings and in paragraph 16 of the same affidavit, he averred that the sale be set aside.
Relying on Sections 413 and 495(1) of the CAMA, the appellant contended that any disposition of the property of the company made after the commencement of the winding up shall, in a winding up by court be void. Similarly, by section 414 of the CAMA any attachment, sequestration, distress or execution put in force against the estate or effect of the respondents’ company after the commencement of the winding up shall be void. It was also contended for the appellant that the trial court failed to consider the affidavit evidence and arguments on law and facts and this has led to miscarriage of justice. See Nwadike & Ors. v. Ibekwe & Ors. (1987) 11-12 SCNJ p. 72; Ojemen & ors. v Momodu II & 2 Ors. (1983) 3 SC 175 and Obodo & Anor. v Ogba & Ors. (1987) 3 SC 459 at 466 – 479. The appellant submitted that the trial court has a duty to resolve all issues raised and joined on the affidavit evidence and arguments of counsel and failure of the trial court to perform this duty is fatal to the decision reached by the court. See Dipcharima & Anor. V Ali & Anor. (1974) 1 All NLR 892 page 420 at 422 and Dumuye vs. Idiozo (1978) 2 SC 1 at 7 – 8.
The appellant opined that the application to declare the sales void underlines that there were problems surrounding the alleged sales either by auction or by private treaty of the respondent company with the 2nd respondent. The Appellant also pointed out that the respondents’ counter-affidavit did not contradict the appellant’s affidavit in respect of the properties sold. The appellant concluded that the Court of Appeal is in the same position as the lower court in drawing inference from facts in support of law before it especially as in the instant case where, all the evidence adduced were by affidavit evidence. See Woluchem & Ors. v Gudi & Ors. (1981)5 SC 291 at 308.
Counsel for the 1st respondent, Mr. Aina, pointed out that though the appellant filed only two grounds of appeal he went ahead to formulate four issues in his brief of argument and that is bad in law ..’ He relied on Madunure v Okafor. (1996) 4 NWLR (Pt. 445) 637 at 644; Hallburton (Nig.) Ltd. v Chapele (1996) 8 NWLR (Pt. 468) 554 at 571; Orakwute v Agagwu (1996) 8 NWLR (Pt. 460) 359 at 370; Ibrahim vs. Mohammed (1996) 3 NWLR (Pt. 437) 453 at 456 and Johnson vs. Ewutuya (1996) 1 NWLR (Pt. 427) 740 at 746 – 747, and submitted that an issue for determination should arise and relate to a ground of appeal and the argument in a brief should also be based on an issue formulated from the ground of appeal. Where this is not so such argument is incompetent and should be ignored. He then pointed out that issues (iii) and (iv) formulated by the appellant ought to be struck out on the ground that they are neither related to nor distilled from any grounds of appeal. They are therefore unarguable and incompetent and they ought to be struck out while issues (i) and (ii) can be conveniently crystallized into one issue.
On the lone issue raised, Mr. Aina, relied on Sections 413, 414 and 500 (1), (a), (b) & (c) of the CAMA and submitted that all the affidavit evidence placed before the court below showed that the disposition of the properties the subject of this appeal to the 2nd respondent was done during the pendency of the winding up proceedings of the appellant’s company, Utuks Construction and Marketing Co. Ltd. and all the parties agreed that the alleged auction sale of the properties took place between November 1993 and October 1994. Counsel also pointed out that the petition for winding up and the verifying affidavit was filed on 11/2/93 and on 25/11/93, a motion for the advertisement of the petition was filed. Relying on section 415(2) of the CAMA and Federal Mortgage Bank of Nigeria vs. Nigeria Deposit Insurance Corporation (1999) 2 NWLR (Pt. 591) 333, counsel submitted that the winding up of a company by the court shall be deemed to commence at the time of the presentation of the petition for the winding up, therefore, the purported sales by the Auctioneer, Messrs Ben Ekpo and the 2nd respondent during the pendency of the winding up of the company without reference to the 1st respondent, the official Liquidator, is void and should be set aside. He urged the court to allow the appeal.
Learned counsel for the 2nd respondent, Mr. Ime Akpan, contended that from the further and better affidavit deposed to by Engr. Bassey Okon, the lack of knowledge of the advertisement and sale of the above properties canvassed by the appellant was debunked: He relied on Egbuna vs. Egbuna (1978) 2 NWLR (Pt. 106) 773; Alagbe vs. Abimbola (1978) 2 SC 39 at 40 and D. N. vs. African Newspaper. Ltd. (1990) 3 NWLR (Pt. 139) 392. Counsel opined that the appellant knew of the advertisement through Exhibit E in the further affidavit of Engr. Bassey Okon but failed to counter it. The appellant acquiesced in the sales and cannot now turn around and complain of miscarriage of justice.
Counsel contended that the whole gamut of evidence led before the trial Judge was on the properties at No. 44 Brooks Street, Uyo. In evaluating the evidence, the trial court rightly held at page 84 of the record that it appears both from the papers filed and address by counsel that they have no problems with the sale of other properties. He concluded that he who assert must prove. He relied on section 135(1) of Evidence Act, 1990; Famwoti vs. Agbeke (1991) 5 NWLR (Pt. 189) 1 and Kwasalba (Nig.) Ltd. vs. Okonkwo (1992) 1 NWLR (Pt. 218) 407.
It was also contended, for the 2nd respondent that though section 413 of the CAMA makes provision f9r the avoidance of dispositions of property after commencement of winding up proceedings, such dispositions are void unless the court orders otherwise. The court therefore has discretion to order otherwise. Counsel also contended that by sections 424 and 425 of CAMA, properties in liquidation do not automatically vest in the liquidation of the company. The sections require the liquidator to make an application for a vesting order which may be refused. It was also contended that there is no credible evidence that the 2nd respondent had any knowledge of the said winding up proceeding filed in court nor was it informed by the appellant company and the 2nd respondent was not a creditor of the appellant. It was also pointed out that Mercantile Bank Nig. Plc. exercised its power of sale under a legal mortgage and disposed of the properties of the company by auction sale in satisfaction of its debt in accordance with the terms of their contract under the mortgage deeds. Counsel then submitted that a person exercising a power of sale under a mortgage deed for the purpose of realizing his security cannot even be restrained from doing so. He relied on Ali Taliya Airlines Ltd. vs. Nigeria Industrial Development Bank Ltd. (1967) FNLR 134 and section 21 (2) of the Conveyancy Act, 1881. He concluded that any person claiming that the power of sale was improperly or irregularly exercised has a remedy in damages against the persons exercising the power namely the Mercantile Bank Nig. Plc.
Counsel also submitted that the setting aside of the properties at No. 44 Brooks Street, Uyo, cannot amount to a repudiation of the whole sale as it was not an issue of contract rather it was based on evaluation of credible evidence before the court and if the exercise of its discretionary power under section 413 of the CAMA which was judicially and judiciously exercised. He then urged the court to dismiss the appeal and affirm the judgment of the lower court.
In the instant case on appeal I observed that the 1st respondent raised some issues relating to the number of issues for determination formulated by the appellant. The issue raised by the 1st respondent would have been more conveniently raised as preliminary objection as it is usually or normally done pursuant to Order 10 Rule 1 of the Court of Appeal Rules, 2007. Not having done so it is doubtful if the issue raised can be considered. Because if it were raised as a preliminary objection, the appellant would have been obliged to file an appellant’s reply brief. I observed that the 2nd respondent in its brief also raised 4 issues for determination from the two grounds of appeal filed by the appellant. Suffice it to say that issues for determination must relate to and arise from the grounds of appeal filed. There is need to avoid proliferation in the formulation of issues. It is not permissible to formulate more than one issue from a ground of appeal even though several grounds of appeal may be covered by one issue. Where such an issue is formulated, it is incompetent and is liable to be struck out and discountenanced or ignored. See Agbeotu v Brisbe (2005) 10 NWLR (Pt. 932) 1 at 16; NITEL vs. Tugbiyele (2005) 3 NWLR (Pt. 912) 334 at 347; Madunure v Okafor (supra) and Haliburton (Nig.) Ltd. vs. Chapele (supra).
I have carefully examined the issues formulated by the parties in this appeal and in my considered view the lone issue formulated by the 1st respondent aptly and sufficiently encapsulated the two grounds of appeal filed by the appellant. I shall in the circumstances adopt arid rely on the said issue for the determination of this appeal. For the avoidance of doubt the lone issue is:
“Whether the trial Judge was right in affirming the validity of the sale of the properties at:
(a) No. 45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) 2 Storey Building along Ekprii Nsukara Road, Uyo.
Properties of the appellant company in liquidation which were sold during the pendency of the winding up proceedings.”
From the record of proceedings particularly the affidavit of evidence at pages 4 – 6, 15, 16, 20, 21, 24, 25, 29 – 31 (advertisement in the gazette), shows that the aforementioned properties were sold during the pendency of the winding up proceedings of the Utuks Construction and Marketing Co. Ltd. All the parties are agreed that the alleged auction sale of the said properties took place between November 1993 and October 1994, which clearly indicate that it was during the pendency of the winding up proceedings of the said company. From the deposition of the Musa Kasimu Bakori of the Federal High Court, in paragraph 4 of the affidavit at page 4 of the record, th3 petition for the winding up of the company was filed at the registry of the Federal High Court, Calabar, in February 1993.
At this juncture, it is necessary to examine and consider the provisions of section 413 of the CAMA. It provides:
“In a winding up by the court, any disposition of the property of the company, holding things in action and any transfer of shares, or alteration in the status of the member of the company made after the commencement of the winding up shall, unless the court otherwise orders be void.”
It is also necessary to examine and consider the provisions of section 414 of the CAMA which provides as follows:
“Where a company is being wound up by the court any attachment, sequestration, distress or execution put in force against the estate or effects of the company after the commencement of winding up shall be void.”
The wordings of sections 413 and 414 of the CAMA are simple, clear, unequivocal and unambiguous, therefore, they should be given their ordinary and natural grammatical meaning, See Nnonye vs. Anyiche (2005) 2 NWLR (Pt. 910) 623; Buhari vs. Obasanjo (2005) 2 NWLR (Pt. 910) 241; Elabanjo v Dawodu (2006) 15 NWLR (Pt. 1001) 76; Saleh VS. Munguno (2006) 15 NWLR (Pt. 1001) 26 and FRN V Osahoh (2006) 5 NWLR (Pt. 973) 361 SC.
There is no dispute that the properties of the company were sold after proceedings for winding up has commenced, therefore, their sale whether by auction or by private treaty is void. The provision of section 413 is mandatory, following the use of the word “shall”. As used in statutes, contracts or the like, the word is generally imperative or mandatory. In common parlance, and in its ordinary signification, the term “shall” is a word of command and one which has always or which must be given a compulsory meaning as denoting obligation. The word in ordinary usage, means must and is inconsistent with the concept of discretion. Thus when the word “shall” is “used in the con of a statute or in ordinary parlance, it means a command to do or not to do a particular act. There is no question of the exercise of discretion to do or not to do the envisaged act. See Ogidi vs. State (2005) 5 NWLR (Pt. 918) 286 at 327. In Onochie vs. Odogwu (2006) 6 NWLR (Pt. 975) 65 at 89 – 90, the Supreme Court held that:
“The word “shall” is used to express a command or exhortation, or what is legally mandatory. Its use in a statute or rules of court makes it mandatory that the rule or provision must be observed…”
In the instant case, any properties of the company sold after the winding up proceedings started or commenced in February 1993 is void. The question of the parties knowing or’ being aware of the winding” up proceedings does not arise in the circumstance. In paragraph 14 of the affidavit of Musa Kasimu Bakori, it was averred that:
“The purported advertisement of sales of the property was done during the pendency of the winding up petition of these companies.”
The court order for the appointment, of the Provisional Liquidator to take over and manage the properties of the company was made during the pendency of the winding up petition of the company. By virtue of section 413 of the CAMA any disposition of property of the company, including things in action and any transfer of shares, or alteration in the stating of the member of the company, made after the commencement of the winding up shall be void.
Furthermore, section 501 (1) of the CAMA provides:
“Where a creditor issues execution against any goods or land of a company or attaches any debt due to the company, and the company is subsequently wound up, the creditor shall not be entitled to retain the benefit of the execution or attachments against the liquidator in the winding up of the company unless he has completed the execution or attachment before the commencement of the winding up.”
The conditions stated under section 501 (1) (a), (b) & (c) of the CAMA are not applicable to the facts of this case. See FMBN vs. NDIC (supra), where the Supreme Court held:
“Where execution and attachment of a company’s goods and chattels have been carried out, but before the lapse of the time permitted by law for the sale share of and before the sale, a liquidator is appointed for the company, the execution will be deemed as having not been completed and the judgment creditor cannot restrain the benefits of the execution unless the rights conferred on the company Debtor as set aside by the Federal High Court in favour of the plaintiff and the goods and chattels must be referred to the company by the Deputy Sheriff.”
At page 367 of the report, Ogundare, JSC (of blessed memory) in his usual erudite stated that:
“I think the above provisions are clear enough and present no difficulty in interpretation. It is not in dispute that the ‘respondent was appointed by the Governor of the Central Bank of Nigeria on his revoking the defendant’s license, to act as provisional liquidator of the defendant. This was on 8th September 1994. On 5th September, 1994 the Deputy Sheriff of the High Court of Lagos State had at the instance of the plaintiff, attached the goods of the defendant. By law, sale could not take place until five clear days after attachment of the goods, that is, 10th September 1994.”
A winding up proceeding is signing the death warrant of a company or a pronouncement of the death of the company. There is incontroverted, unchallenged and uncontradicted affidavit evidence that the petition for the winding up of the Utuks Construction and Marketing Company Ltd. was filed in the registry of the Federal High Court in February 1993. Pursuant to section 415(2) of the CAMA, the winding up of the said company is deemed to have commenced on that date. That being the case the purported advertisement for the sale of the goods made in the Nigerian Tide of Saturday,6/11/93 which is at page 19 of the 21/16/94. See page 5 of the record. See also photocopies of the Official Gazette at page 29 and the copies of the advertisement of petition at page 30 of the record of proceedings.
All through the gamut of the affidavit evidence before nowhere was averred that any court made any order for the disposition of the property of the company. Section 415(2) of the CAMA provides:
“In any other case, the winding up of a company by the court shall be deemed to commence at the time of the presentation of the petition for the winding up.”
It is a very serious matter, compliance with the relevant sections dealing with the winding up proceedings must be strictly observed and followed. See Tate Industrial Plc. v Devcom M. B. Ltd. (2004) 17 NWLR (Pt. 901) 182. The term liquidation or winding up cover a process whereby the life of a company is ended and its property administered for the benefit of its creditors and members.
The trial court failed to make any finding of fact as to whether the purported sales carried out by the auctioneer appointed by Mercantile Bank of Nig. Plc. during the pendency of the winding up proceedings were valid sales. The learned trial Judge in his Ruling at page 54 of the record simply said:
“It may appear both from the papers filed and addressed by counsel that they have no problem with the sales of the properties at No. 45 Ekpanya Street, Uyo; No. 50 NEPA Line, Uyo and two (2 No.) Storey building along Ekpiri Nsukara Road, Uyo. In the (sic) both the party’s affidavit and their counsel address. I have been referred to only No. 44 Brooks Street, Uyo. In view of that I do not have any problem in holding the sales of No. 45 Ekpanya Street, Uyo, No. 50 NEPA Line, Uyo, and. two Storeys building along Ekpiri Nsukara Road, Uyo, is valid.”
Apparently, the learned trial judge did not advert his mind to the issue cancassed by the parties in the respective affidavit and neither did he consider the mandatory provisions of sections 413, 414, 415 (2) and 500(1) of the CAMA and they in no way subject to the consent or otherwise of the parties to the transaction. Further, the trial judge failed to resolve the contentious issues raised by the parties. It is equally strange that the trial judge said none of the parties in their affidavit and counsel address referred to the other properties aforesaid. At page 51 of the record the learned trial judge stated clearly that:
“This is a motion brought by the provisional liquidator on the aforesaid company. Utuks pursuant to sections 425 (1)(d), 413 and 114 of the companies and Allied Matters Decree praying the court for an order declaring the sales and advertisements of the following properties void…”
It is difficult to appreciate the difficulty of the trial Judge having stated clearly the purport of the application. Pages 2 – 31 of the record is replete with the different affidavits and counter-affidavits and exhibits in support of the petition application. So it is not easy to understand or appreciate the finding of the trial Judge in the face of the affidavit evidence available in the record. There was enough evidence for the trial court to reach the conclusion that the sale of the aforesaid properties was void. It is clear that the auctioneer sold the properties during the pendency of the winding up proceedings. The auctioneer did not affect the sale of the said properties under the directions or order of any court of law in accordance with section 500(1) (b) of the CAMA. Certainly the trial Judge did not exercise his discretion judiciously and judicially or at all. To hold that because there was no argument against the sale of the said properties, the sales were therefore valid is not judicious or judicial exercise of discretion. Contrary to the finding of the trial Judge, the appellant alleged at page 36 of the record that the 2nd respondent had actual notice and impute notice of the sale of the properties. Furthermore, the appellant alleged that there was collusion with intent to defraud the company between the secretary of the company, their solicitors and the 2nd respondent, and the auctioneer; therefore, there was no bona fide sale.
The appellant also revealed that the Sanctuary Law Firm by their letter dated 6/7/95 to Union Bank as solicitor for the 2nd respondent informing them of the purchase. Now, it is the same law firm that is representing the company, and it is also representing the company in the winding up proceedings and it is also acting for the purchaser of the said properties of the 2nd respondent.
Judicial discretion must be exercised according to common sense, and according to justice. If there is any miscarriage of justice in the exercise of such discretion, it is within the competence of an appellate court to review it. A judicial and judicious discretion which is well exercised is one which is marked by fairness under the circumstances of any given case, and guided by the rules and principles of law. Where a trial court fails to exercise sound and reasonable decision, the Appeal Court will review such a decision. In the circumstances this court will interfere with the exercise of discretion by the trial court. See Okere vs. Nkem (1992) 4 NWLR (Pt. 234) 13; Ashitu vs. Ayoade (2006) 6 NWLR (Pt. 976) 405; Isiaka vs. Ogumdimu (2006) 13 NWLR (Pt. 997) 401; Ezenwaji vs. UNN (2006) 3 NWLR (Pt. 967) 325; Adejumo vs. The State (2006) 9 NWLR (Pt. 986) 627; Ofordile vs. Egwuata (2006) 1 NWLR (Pt. 961) 421 and Ukpo vs. Imoke (2009) 1 NWLR (Pt. 1121) 90 at 167 – 168.
From the overwhelming affidavit evidence available, the trial court ought to have declared the sale of the properties void. There is merit in this appeal and it deserves to succeed.
Accordingly, this appeal be and is hereby allowed. The sale of properties at:
(a) No. 45, Ekpanya Street, Uyo.
(b) No. 50 NEPA Line, Uyo.
(c) Two (2) number ,Storey Buildings along Ekpiri Nsukara Road, Uyo, be and are hereby declared void.
And it is hereby ordered that the above named properties be vested in the custody of the Liquidator in trust for the members of the company and the creditors. Costs assessed and affixed at N10, 000.00 in favour of the appellant.
Other Citations: (2009)LCN/3149(CA)
