O. Sodade & Ors V. E. O. Imagie & Ors (1989)
LawGlobal-Hub Lead Judgment Report
AWOGU, J.C.A.
This appeal deals with the problem of Trade Union officials who fight over positions rather than carry out the sacred trust placed upon them by the members of the Union. Such infighting creates the erroneous impression of the existence of a Union “cake” to be shared. The law reports of this country are now replete with disputes of this nature.
The facts of the present dispute arose in this manner. The Plaintiffs, now Respondents, were removed as officers of the 6th Defendant, namely, the National Union of Postal/Telecommunications Employees. In suit No.LD/1662/86 at the Lagos High Court, the Plaintiffs sued for:
- A declaration that the purported suspension and or removal of the Plaintiffs by the Central Working Committee is unconstitutional, null and void.
- A declaration that the decision of the Central Working Committee which sat on the 8th of October, 1986 in so far as it affects the Plaintiffs is unconstitutional, illegal, null and void.
- An injunction restraining the 6th Defendants, their agents and allies from ratifying, removing, or suspending the Plaintiffs pending the determination of this suit.
- An injunction restraining the Defendants, their agents and allies from operating the A.C.B. accounts or other accounts of the 6th Defendant pending the determination of this suit.
- That 1st, 2nd and 3rd Plaintiffs be declared the rightful and legal National President, State Chairman, Kaduna and State Secretary, Kaduna respectively.
- That only the 1st plaintiff and 2nd defendant are the only persons constitutionally authorised and legally competent to summon meetings for and on behalf of the 6th Defendants, its agents and allies.
This was followed by an application for interlocutory injunction, to wit.:
“(1) An order of interim injunction restraining the defendants, their agents, servants and privies in this suit from holding the purported National Executive Council on December 4th and 5th, 1986 at 12 Gbaja Street, Surulere or at any other place pending the determination of this suit.
(2) That the National Union of Postal Telecommunications Employees Account Nos. 50771, 51125, 27941 of A.C.B., Ojuelegba Branch be frozen pending the determination of this issue, and all monies withdrawn for the ill-fated National Executive Council meeting be paid into Court also pending the determination of the suit.”
By the time the application was heard, the meeting of the National Executive Council had already taken place and certain monies withdrawn from the accounts used for the purpose. As a result, the first prayer above became state. This also affected some aspect of the second prayer. The learned Judge, after hearing both parties, did not freeze the accounts, as prayed, but ordered the Registrar of Trade Unions to appoint an Administrator to administer and operate these Accounts pending the determination of the suit. This order is the subject of the first complaint in this appeal. It appears that inspite of the above Order, the Respondents still operated Account No.50771 on the grounds that it was not included in the order, although this appears to be an error as Account No. 55771 was excluded from the order in error. As a result, a subsequent application was made, and granted by another Judge. This is the subject of the second complaint in the appeal. Against both orders, the Appellants filed the following grounds of appeal:
(1) Error in Law
The learned trial Judge erred in restraining the Defendants from operating the accounts of the 6th Defendant Union when:-
(i) The Plaintiffs had not shown that they had any right to the funds contained in the said accounts of the 6th Defendant Union;
(ii) The Plaintiffs had not shown that irreparable injury would result to them if the injunction sought were not granted;
(iii) The Plaintiffs were not entitled to the said injunction under section 16 of the Trade Unions Decree of 1973;
(iv) The learned trial Judge had himself held that the Plaintiffs were not covered by section 16 of the Trades Union Decree;
(v) The Plaintiffs had no general right to interfere with the operation of the accounts of the 6th Defendant Union or to prevent any of the named Defendants from performing their functions within the 6th Defendant in accordance with its Constitution;
(vi) The balance of convenience required that the affairs of the 6th Defendant Union continue to be run by the officials of the Union for the time being.
(2) Error in Law
The learned trial Judge erred in law in restraining the Defendants from operating the bank accounts of the 6th Defendant Union on the basis that the 1st Plaintiff had not been validly removed and that he remained President of the 6th Defendant Union when:-
(i) The basis upon which the Plaintiffs had sought an order freezing the accounts of the 6th Defendant Union was the allegations that:-
(a) there was still outstanding against the 2nd Defendant and his staff “a case of financial impropriety”
(b) there had also been discovered against the 1st, 2nd, 3rd and 4th Defendants other “financial improprieties”;
(ii) The learned trial Judge did not advert his mind to the extensive denials of the said allegations supported by documentary evidence, which were contained in the counter-affidavits filed on behalf of the Defendants;
(iii) The learned trial Judge failed to make any finding whatsoever in respect of the allegations on which the Plaintiffs had based their request for an order freezing the accounts of the 6th Defendant Union;
(iv) Instead, the learned trial Judge went outside the Issues raised by the parties to canvass an issue not raised before him, namely that because the 1st Plaintiff had not been validly removed and he was named as one of the operators of the 6th Defendant’s accounts in the Constitution of the Union, the Defendants herein could not operate the accounts.
(3) Error in Law
The learned trial Judge erred in law in holding that the Plaintiffs had not been validly removed from office when:-
(i) The issue before him was an application by the Plaintiffs for an order freezing certain Bank accounts maintained by the 6th Defendant Union.
(ii) The basis upon which the Plaintiffs had sought the order was not that they had not been validly removed, but that the 1st to 4th Defendants were guilty of “financial improprieties” which rendered them unfit to have charge of the funds of the 6th Defendant;
(iii) The Defendants addressed the learned trial Judge only on the issues properly raised before him in respect of the application to freeze the accounts;
(iv) The Defendants were not heard on the issue of the validity or otherwise of the removal of the Plaintiffs before the learned trial Judge came to a conclusion on the same;
(4) Error in Law
The learned trial Judge erred in law in pronouncing on the validity or otherwise of the removal of the Plaintiffs from office on the interlocutory application for an order freezing certain Bank accounts of the 6th Defendant when:-
(i) The main substantive claim of the plaintiffs consisted of a challenge to the validity of their said removal:
(ii) By pronouncing on the matter in connection with an interlocutory application in respect of a separate issue, the learned trial Judge effectively pre-judged the main issue which ought to have been raised at the trial of the action herein;
(iii) The Defendants were thereby deprived of the opportunity to present their defence to call any evidence or to make any submissions in respect thereof:
(iv) Having already determined the substantive issue on an interlocutory application, the learned trial Judge thereby rendered any proposals by the Defendants to defend the action herein futile.
(5) Error in Law
The learned trial Judge erred in law in holding that the 1st Plaintiff had not been validly removed from office when:-
(i) Rule 13(x) of the 6th Defendant’s Constitution gave the National Executive Council power to remove the President of the Union or any other National Officer from office:
(ii) The evidence before the learned trial Judge showed that at its meeting held on the 4th and 5th of December, 1986, the said National Executive Council had unanimously decided to remove the 1st Plaintiff from the 6th Defendant Union;
(iii) The National Executive Council was thereby acting upon a recommendation made to it by the Central Working Committee – the body established under Rule 9 of the Constitution with the duty of conducting the business of the National Executive Council and of reporting to the National Executive Council;
(iv) The National Executive Council was entitled to expel the 1st Plaintiff even without any recommendation to that effect from the Central Working Committee.
(6) Error in Law
The learned trial judge erred in law in ordering the Registrar of Trade Unions to appoint an “Administrator” to operate the accounts of the 6th Defendant Union when:-
(i) The Registrar of Trade Unions was not before him as a party to the action;
(ii) The office of the Registrar of Trade Unions, and the powers and duties attached thereto are provided for by Statute, namely the Trade Unions Decree No.38 of 1973 as amended from time to time;
(iii) The statutory powers and duties of the Registrar of Trade Unions do not include the right to appoint any person to operate or manage the funds of any Trade Union;
(7) Error in Law
The learned trial Judge erred in law in holding that the Defendants had acted “recklessly” and could not be trusted with running the Bank Accounts of the Union when:-
(i) The evidence before the learned trial Judge showed that the decision to suspend the 1st plaintiff from office had been taken by a majority of mine to five at a meeting of the Central Working Committee of the Union attended by nineteen members;
(ii) There was no evidence before the learned trial judge to suggest whether or not the five name Defendants participated in the vote or the manner in which they voted, or that they were the ones responsible for the decision to suspend the 1st plaintiff and to recommend his expulsion from the 6th Defendants;
(iii) Even if the removal of the plaintiffs from office was indeed invalid, and evne if the Defendants had indeed acted recklessly in respect of the plaintiffs’ removal, that would not entitled the learned trial judge to also deprive the Defendants from the right to perform their own functions under the Constitution of the 6th Defendant Union;
(8) Error in Law
The learned trial judge erred in law in holding that because defendants had acted “recklessly” in respect of the removal from office of the plaintiffs, they could not be trusted with running the Bank Accounts of the Union when:
(i) The requested for the freezing of the bank accounts of the 6th Defendant was based upon the allegation of financial impropriety made against four of the Defendants;
(ii) The learned trial Judge had failed either to consider in any particular whatsoever the counter-affidavits filed by the Defendants in respect of the allegations of financial impropriety, or to make any findings one way or the other in respect of the said allegations;
(iii) The Constitution which was before him disclosed that the signatories to the accounts of the 6th Defendant Union were the President, the Treasurer and any one of the three Trustees;
(v) None of the said Trustees was before the learned trial Judge as a defendant;
Before this Court, Briefs were-ordered and exchanged. The Appellants set down the following issues for determination:
2.01 The main issue raised by this appeal is as follows:-
Having held that it would be “unreasonable” to accede to the only remaining prayer for an injunction before him, was the learned trial Judge entitled to make another order which the Plaintiffs did not ask for?
A negative answer to this question effectively disposes of the whole appeal. Nonetheless there are also subsidiary issues on specific points, namely:-
(ii) Whether the order should have been made when the Plaintiffs neither alleged nor showed any right to the funds of the 6th Defendant Union;
(iii) Whether the 5th Defendant and the Trustees of the Union should have been restrained from performing their duties under the Union’s constitution when no reason was shown for such order;
(iv) Whether the alleged recklessness in the removal of the Plaintiff from office was relevant to the operation of the bank accounts;
(v) Whether an order ought to have been made on the Registrar a Trade Unions.
2.02 The second issue relates to the pronouncements made by the learned trial Judge in respect of the substantive action:-
(vi) Whether it was right for the learned trial Judge to make definite findings on the issues raised in the substantive case when:-
(a) the application before the court was for an order freezing certain bank accounts of the 6th Defendant Union;
(b) the Defendants were not heard on the issues relating to the substantive action on which the learned trial Judge eventually based his order;
(vii) Whether the learned trial Judge was in any case correct in holding that the 1st Plaintiff had not been validly removed from office.
The Respondents did not set down any issues for determination, and, in effect, relied on the issues so set down by the Appellants. The appeal will therefore be considered on the basis of the issues set down for determination by the Appellants. In his oral submission, Chief Ajayi submitted that the learned Judge rejected the application to freeze the accounts and referred to pages 76-8 of the supplementary Record of Appeal. Thereafter, the Judge made the order not sought for, by ordering an Administrator nominated by the Registrar of Trade Unions, to operate the accounts in the interim. T. N. Nnadi for the Respondents submitted that the learned Judge made the order under section 14 of the High Court of Lagos State Law, as he was empowered to do. He also submitted that the order in respect of Account No. 50771 was an amendment to remedy an earlier error. He urged the Court to dismiss the appeal.
The reliefs sought by the Respondents, quoted earlier, include in injunction restraining the Defendants, their agents and allies, from operating the A.C.B. accounts or any other accounts of the 6th Defendant pending the determination of this suit. The main complaint, however, is the removal of the Respondents from office. Thus, in the 24-paragraph Statement of Claim, only paragraph 23 deals with the issue of accounts. It states as follows:
- That the accounts of the 6th Defendant would be in serious jeopardy if they are not frozen pending the determination of this case as the 1st and 5th defendants’ financial improprieties would liquidate the account of the said 6th Defendant.
The Respondents sought many other reliefs of an interim nature, some of which were later abandoned. They however pursued rigorously the issue of accounts. Thus, on November 28, 1986, there was the motion under Order 32 Rule 12, to wit:
“(1) An Order of interim injunction restraining the defendants, their agents, servants and privies in this suit from holding the purported National Executive Council on December 4th and 5th 1986, at 12 Gbaja Street, Surulere or at any other place pending the determination of this suit.
(2) That the National Union of Postal Telecommunications Employees Account Nos.50771, 51125, 27941 of A.C.B, Ojuelegba Branch be frozen pending the determination of this issue, and all monies withdrawn for the ill-fated National Executive Council meeting be paid into Court also pending the determination of the suit.”
The two “very urgent” affidavits in support of this application did not show how the accounts would be in “serious jeopardy” save of course for the financial improprieties of the 1-5 defendants. No details were supplied. Exhibit E. O. 1, the Constitution of the Union, showed that withdrawals from the accounts of the Union could only be made over the signatures of the 1st Plaintiff, the 5th Defendant, and one of the 3 Trustees of the Union. Here, only one of the three, 1st Plaintiff, was challenging his removal from office, and there was no affidavit evidence to show how the 5th Defendant would either alone, or in collaboration with others, endanger the account because of the removal of the 1st Plaintiff. If anything, the removal smacks more of vindictiveness for the findings of impropriety against 1-4 Defendants, but not against 5th. The removal did not ipso facto put the account in peril. This Motion was argued early in 1987, followed by the Ruling of Ayorinde J. dated April 28, 1987, in which he made the following order:
The 1st to 5th Defendants have acted recklessly and illegally that I should restrain them from operating these accounts. In the circumstances, I order that the Registrar of Trade Union shall appoint an administrator to administer and operate these Accounts pending the determination of this suit.
This is the first order complained of in this appeal. The second relates to a later order of Adeyinka, J., made on May 18, 1987, which brought Account No.50771 into the ambit of the order of Ayorinde, J., the reason being that it was included in the application but erroneously omitted in the said order. I agree that this is so. This leaves for consideration the propriety or otherwise of the order of Ayorinde, J., dated April 28, 1987. It of course goes without saying that if the order of Ayorinde, J., is found to be improper, the decision will also affect the order of Adeyinka, J., in respect of Account No.50771.
The purpose of the interim orders sought by the Applicants was to preserve the status quo. Indeed, the 1st prayer which was later withdrawn as having been overtaken by events, was for:
An order of interim injunction restraining the defendants, their agents, servants and privies in this suit, from holding the purported National Executive Council on December 4 and 5, 1986, at 12 Gbaja Street, Surulere, or at any other place, pending the determination of this suit.
For the same reason, the second leg of the 2nd prayer, to wit., payment into court of monies withdrawn for the “ill-fated N.E.C. meeting”, was also withdrawn. Thus, only the freezing of the accounts in the interim was left for consideration. There are hardly any hard and fast rules for determining whether or not to grant an interim injunction. The discretion is unfettered, and for good reason. As Obaseki, J .S.C., observed in Obeya Memo. Specialist Hospital v. A-G. F. & Anor. (1987) 7 S.C. at 73:
“The purpose sought to be achieved by giving to the court discretion to grant such injunctions would be stultified if the discretion were clogged by a technical rule forbidding its exercise if upon that incomplete untested evidence the court evaluated the chances of the Plaintiff’s ultimate success in the action at 50 per cent or less but permitting its exercise if the court evaluated his chances at more than 50 per cent.”
There are, of course, guidelines, notably, Ladunni v. Kukoyi (1972) 3 S.C. 31; John Holt (Nig.) Ltd. v. Holts African Workers Union (1963) 1 All N.L.R. 379; Cyanamid v. Ethicon Limited (1975) A.C. 396; Egbe v. Onogun (1972) 1 All N.L.R. 95; Kufeji v. Kogbe (1961) 1 All N.L.R. 113, among others.
As observed earlier, the application was brought under Order 39, rule 12 (although at the oral hearing, Nnadi opted for section 14 of the High Court of Lagos Law); the Order, and Rule, are inapplicable. Even if what was intended was Order 39, rule 2, that too is limited to disputed contracts. Similarly, if the reliance was upon section 39 (2) of the Trade Unions Decree No. 31 of 1973, that too would be inapplicable. Be that as it may, only section 18 of the High Court Law may here be prayed in aid. It states:
“(1) The High Court may grant a mandamus (as defined in subsection (5) or an injunction or appoint a receiver by an interlocutory order in all cases in which it appears to the court to be just or convenient so to do.
(2) Any such order may be made either unconditionally or on such terms and conditions as the court thinks just.
(3) If, whether before, or at, or after the hearing of any civil cause or matter, an application is made for an injunction to prevent any threatened or apprehended waste or trespass, the injunction may be granted, if the court thinks fit, whether the person against whom the injunction is sought is or is not in possession under any claim of title or otherwise, or (if out of possession) does or does not claim a right to do the act sought to be restrained under any colour of title, and whether the estates claimed by both or by either of the parties are legal or equitable.”
Now, even if an interim order must be made in favour of the plaintiffs/Respondents, in view of the alleged financial improprieties of the named Defendants, it can only be, in the words of Lord Cottenham, L. C., in Hilton v. The Earl of Granville, 184 Cr. Ph. 283 at 297:
“Now, by withholding it, I certainly may expose the plaintiff not only to damage, but to an injury and a wrong; by granting it, on the other hand, I am exposing the defendant to what, in the event of my turning out to be mistaken in the view I take of the rights of the parties, will be an irreparable injury. The plaintiffs injury, if he sustains it, and ought not to have sustained it, will be, to a great extent, at least, capable of reparation…”
Surely, if the financial improprieties can continue, and the plaintiffs win at the end of the day, reparation for the funds so dissipated, is still possible, the more so as the nexus between the plaintiffs and the fund would not be destroyed by their removal. The learned Judge did not consider this balance of convenience, save in the context of the irreparable injury which may be done to the Defendants/Appellants by way of a total embargo on the operation of the accounts. As a result, he refused the application “to freeze” but agreed to appoint an administrator through the instrumentality of the Registrar of Trade Unions. But, does he, then, have the power so to do?
Although section 18 of the High Court Law allows for an interim order for the preservation of the subject-matter in dispute, the learned Judge did not, in my view, have the power to involve a third party, as if he was appointing a Receiver or an Arbitrator which, under the High Court Law and Rules, is a specific grant of power. True, the Trade Unions Decree No. 31 of 1973 provides for the services of the Registrar in the situation such as confronted the learned Judge in the instant appeal, but this can only be resorted to as prescribed by that Law. On this, section 16 of the Decree states as follows:
“(1) Without prejudice to the right of any person having a sufficient interest in the relief sought to apply for an injunction to restrain any unauthorised or unlawful application of the funds of a trade union, an injunction restraining any such application of funds of a trade union may be granted by the appropriate High Court upon the application of the Attorney-General of the Federation or of the Registrar, or of any five or more members of the union.
(2) On an application under this section the appropriate High Court may, in addition to or instead of granting an injunction, order that the whole or any part of the funds of the trade union be paid over to the Public Trustee to be administered or disposed of in accordance with the rules of the union.”
The present application is by three plaintiffs who are members of the Union, not by five or more members of the Union. True, any person with sufficient interest in the matter has the locus standi to go to court and make the application, without being defeated on grounds of number, but such a person would not be relying on section 16 of the Decree, but on the inherent and granted powers of a court to preserve the status quo pending the final determination of the subject-matter in dispute. Hence, in the exercise of this power, the learned Judge cannot invoke section 16 of the Decree, in view of the deficiency in number, where the application was not by the Attorney-General of the Federation, or the Registrar of Trade Unions. The learned Judge was himself conscious of this, hence he said:
“The application before the Court is not brought under section 16 of the Trade Union Act of 1973 on misapplication of funds. It is that the 3 plaintiffs are illegally removed from the parent Union and Kaduna Branch.”
Thereafter, he proceeded to make an order as if under section 16. It would, of course, have been within his competence to freeze the accounts simpliciter or to freeze the account on specifically laid-down conditions. This he chose not to do and the order he made was therefore not sought for by the Applicants in the Motion, even if he gratuitously made it in due deference to the wishes of the Appellants, as Nnadi for the Respondents, appears to suggest.
Accordingly, the Ruling of Ayorinde, J., dated April 28, 1987, is hereby set aside. This also covers the order of Adeyinka, J., dated May 18, 1987. If an Administrator was appointed under both orders, he must within 14 days from today surrender the operation of the accounts to the 6th Defendant (i.e. the Union) after rendering necessary account to the 6th Defendant. It only remains to add that in view of the findings of Ayorinde, J., in the Ruling, on the propriety or otherwise of suspending the plaintiffs, which was an issue for the main trial, the case should now continue before another Judge of the High Court of Lagos. Each side is to bear the cost of this appeal.
Other Citations: (1989) LCN/0076(CA)
