Shell Petroleum Development Company of Nigeria Limited V. Henri E. Omu (1998)
LawGlobal-Hub Lead Judgment Report
UWAIFO, J.C.A,
On 19 January, 1998, Okor, J., sitting at the High Court, Port Harcourt, made an order of interlocutory injunction against the appellant/applicant upon a notice of motion by the respondent as plaintiff in the suit in which he prayed as follows:
“An order of interlocutory injunction restraining the defendant, either acting by itself, privies, servants or agents, from taking any disciplinary action against the plaintiff, either by way of warning, suspension from duty, termination or summary dismissal or howsoever interfering (with) the plaintiffs contract of employment, rights and privileges as a confirmed staff of the defendant company, pending the determination of the substantive suit.”
At the time of the ruling in which the interlocutory order was made, the plaintiff had not filed any pleading. But the case to be determined in the substantive action is sufficiently, I think, indicated in the reliefs stated in his writ of summons and it is perhaps instructive to consider the interlocutory injunction against the background of those reliefs. I shall reproduce them (unedited) as follows:
“(1) A declaration that the finding by the defendant’s audit report that the plaintiff is culpable for having caused the defendant the avoidable loss of N5,000.000 in 1994, without hearing the plaintiff or giving him an opportunity to be heard is ultra vires, contrary to the principle of fair hearing; unconstitutional, a gross violation of the provisions of the African Charter on Human and Peoples’ Rights and consequently null and void.
(2) A declaration that the defendant, either acting by itself, servants, agents, directors or privies, is not entitled to take any punitive measures against that plaintiff, either by way of suspension from duty, dismissal from the employment of the defendant, termination of his appointment or howsoever interfering with the plaintiff’s contract of employment with the defendant under any guise, based on the recommendation of the defendant’s Eastern Divisional Defalcation and Avoidable Loss Committee or any of the defendant’s servants, agents or privies, acting on the said audit report.
(3) An order selling aside the said defendant’s finding contained in the said audit report as far as the same affects the plaintiff or contains any adverse finding or indictment of the plaintiff.
(4) An order of perpetual injunction restraining the defendant, either acting by itself, servants, directors, agents or privies from taking any disciplinary measures or action against the plaintiff, either by way of suspension from duty, demotion, loss of promotion or increment, warning, termination of his appointment or dismissal from the employment of defendant, pursuant to the said audit report and recommendation of the said Defalcation and Avoidable Loss Committee or any other committee or body within the defendant company, acting on the finding of the said Alafun Audit Report(s) and recommendation of the said committee.”
The affidavit in support of the motion deposed to a number of facts and insinuations, including motive and malice against one Mr. Alafun as regards the respondent’s activities in a department of the applicant company known as Public and Government Affairs East (PAGE). It is sufficient to refer to 4 paragraphs out of the 2S-paragraph affidavit which read as follows:
“14. That based on the finding of the Alafun Committee the Eastern Divisional Defalcation Committee, to which Mr. Alafun is the secretary, had recommended that all those indicted by its report be subjected to disciplinary measures and the defendant proceeded to attempt to discipline my boss, Mr. Lawson Jack, who successfully got the High Court of Rivers Stale to restrain the defendant.
- That as I did not consider myself involved in any wrong doing considering the various commendations I had received from the defendant and having left PAGE and not concerned with the 1996 furniture award and supply which Alafun had referred to my department for the investigation, I kept enjoying my leave until last Friday when I learnt that since the court had restrained the defendant from taking any disciplinary action against Mr. Lawson Jack, the defendant had decided last week to punish me instead, based on the indictment contained in Mr. Alafun’s report and papers have been raised against me and forwarded to the Managing Director of the defendant for his approval to met (sic) out punishment to me, on account of the finding of Ala fun audit report against me, following his investigation in PAGE School Furniture Supplies/Deliveries Contract 1993,”1996, instead of the 1996 which was the subject of his investigation. Exhibited and marked ‘E’ is an extract from the minutes of the Eastern Divisional Defalcation Committee which recommended disciplinary action against me to the Managing Director of defendant held last week, under the heading ‘Status of Disciplinary Action Recommendations. ‘
- That any moment from now the defendant will take severe disciplinary action against me which would either be in the form of last warning, suspension from duty, demotion, loss of increment, termination of my appointment or summary dismissal.
- That unless this application is heard expeditiously the defendant will proceed to quickly suspend me from duty, terminate my appointment or altogether summarily dismiss me and it would be difficult or impossible to reinstate me.”
It will be noted in paras. 16 and 23 that the respondent simply speculated on what the applicant might do to his employment which necessitated his suit in court and the interlocutory injunction he subsequently obtained. In paras. 14 and 15 he alluded to how one Mr. Lawson-Jack similarly succeeded in the High Court to get an interlocutory injunction. Having so made that reference, it has become pertinent to draw attention to the result on appeal of that case decided by this court on 19 March, 1998 and now reported as Shell Petroleum Development Company of Nigeria Ltd. v. Stephen Lawson-Jack (1998) 4 NWLR (Pt.545) 249 which the lower courts are constitutionally bound to follow. This court set aside that injunction as unlawful and unavailable in such a matter.
In fairness to Okor, J., as at the date he gave his ruling on 19 January, 1998, he had not the benefit of the said decision of this court because it had not been made. The present case, just as the Lawson-lack’s case, is one of ordinary master and servant relationship. The learned trial Judge acknowledged this when he observed in his said ruling:
“It is admitted that the relationship between the plaintiff and the defendant is one of master and servant which said relationship is governed by the contract of employment.
It is also admitted that such relationship can be determined or terminated in accordance with the terms of the contract of employment.”
But he went further to say in what looks like a rather definitive standpoint, more so in an interlocutory decision, that:
“However where the dismissal or disciplinary action is being taken against the employee as a result of a finding of a panel set up to investigate the employee the employee must be given an opportunity of being heard by the panel investigating him. The employer cannot rely on the sanctity of contract to contract itself out from the observance of the rule of natural justice.
In other words, before dismissing his employee he must satisfy the requirements of fair hearing and so, must ensure that from all the circumstances of the case, the allegations against such an employee are sufficiently brought to his notice and adequate time is given to such employee to reply to such allegations”
In the instant case, there was an allegation of fraud against the plaintiff. A panel was set up to investigate the fraud. Plaintiff was found guilty but was not given an opportunity to be heard or defend himself. In fact he never knew about the setting up of the panel or the sitting of the panel until the report was out and disciplinary action was to be taken against him. As the law stands, the defendant cannot rely on the sanctity of the contract of employment to dismiss or take disciplinary action against him.”
The applicant has filed six grounds of appeal against the ruling. The 1st ground complains that pronouncements made therein amount to a disposal of the substantive suit. The 2nd and 3rd grounds say the learned trial Judge focused on dismissal without giving room for mere termination of appointment. The 4th ground emphasizes further that if a master merely terminates a servant’s appointment under the contract the court cannot look at the motive for it, even if there was one disclosed as that, is irrelevant. The 5th ground complains that by the interlocutory injunction the respondent has been imposed on the applicant who will not be able to get rid of him even by complying with the contract agreement to terminate him. Ground 6 says the interlocutory injunction is incompetent because no undertaking as to damages was ordered.
It cannot be doubted that the first five grounds of appeal are substantial. The learned trial Judge did not give any allowance for the applicant’s discretion to overlook the alleged audit report but to exercise its right to terminate the respondent’ appointment by giving due notice or by payment of salary and allowances in lieu of such notice in accordance with the contract of employment. He made the interlocutory injunction all-embracing. I shall not say more on that at this stage as the question of the lawfulness of the interlocutory injunction in any event in the present case is an issue which may feature in the appeal and therefore it would be inadvisable to make pronouncements that would tend to prejudge that issue now: see Olaniyi v. Aroyehun (1991) 5 NWLR (Pt.194)652.
The applicant has filed a notice of motion to have the interlocutory injunction suspended pending the determination of the appeal against it. In the affidavit in support of the motion, it is deposed that no cordial employer/employee relationship between the parties exists any longer and that this does not promote good and productive working condition; that the situation in effect tends to destabilize the applicant’s business because the respondent cannot be dutiful to serve the interest of the applicant, and the interlocutory injunction makes it impossible to discipline him or to put another person in his position; that the respondent has deliberately stalled filing his respondent’s brief in accord with the accelerated hearing of the appeal made by this court for 6/5/98; that the applicant will be compelled to pay salary and allowances to the respondent for no work done as long as the appeal lasts; that while the applicant is in a position to pay the salary and allowances in arrears if the respondent should be successful in the end, the respondent cannot pay back what he earns in the interim should he be unsuccessful. Dr. Mowoe submitted along the line of that affidavit.
Mr. Ukiri on behalf of the respondent contended that the applicant was not entitled to the suspension of the interlocutory injunction granted by the lower court because that was substantially what the appeal against that injunction would be seeking to achieve. He said the application was brought because of the failure of the respondent to file his brief. According to him, the present application is an indirect way of disposing of the appeal in a summary manner while an application for extension of time within which to file the respondent’s brief is pending before this court, having been brought on 5 May, 1998. He submitted that this is not an appropriate instance to suspend the interlocutory injunction having regard to the affidavit evidence.
I think that a combination of the substantial grounds of appeal and the desire of the applicant to save the integrity of its business atmosphere and to prevent instability provide special circumstances it can rely on for the present application to have the interlocutory injunction suspended pending the determination of the appeal before this court. In Ajomale v. Yaduat (No.2) (1991) 5 NWLR (Pt.191) 266 at 291, it was observed about a ground of appeal in the consideration of a stay of execution per Nnaemeka-Agu JSC:
“For such a ground to constitute a special circumstance, it must arise in a type of decision where a stay can be granted and, in relation to the facts and circumstances of the particular case, be such that if it is decided in favour of the appellant some substantial injustice or some irreversible circumstances shall have resulted which would have made it more appropriate had a stay been granted … In short, it is not every ground which has raised an important or difficulty point of law that can suffice as a special circumstance on the ground of recondity (sic: reconditeness). The recondity (sic) of a point of law with reference to an application for a stay of execution is not determined in the abstract by reference to the importance of difficulty of the point raised in the ground of appeal per se. Rather, it is determined in concrete terms by reference to what the effect of a refusal to stay execution may be on the rights of the appellant, if successful in the appeal. In Balogun v. Balogun (1969) 1 All NLR 349], a matrimonial cause, which is the fons et origo of in-comprehended point, the issue was whether payment of rent was pan of maintenance for a divorced wife. There can be no doubt that if execution was not stayed and rent was paid as pan of maintenance, if it turned out on appeal that it ought not have been so, serious difficulties of recovery would have arisen.”So also in the present case, I believe it would be far more feasible to get the applicant to pay all entitlements of the respondent in case the appeal failed than to compel the respondent to repay what he earned while the appeal lasted, in case it was successful in the end. That circumstance appears to be the background to the reasoning in Balogun v. Balogun (supra) in a sense, namely, the real difficulty in recovering what is paid over as salary and allowances to the respondent in the meantime. This would seem to be accentuated and indeed exacerbated by a scenario whereby (1) the respondent would appear foisted on an unwilling master; (2) the master would have no obligation in law to assign him any work; (3) salary and allowances would be paid out for no work done: (4) the business of the master would suffer in terms of productivity: (5) the atmosphere of discipline in the applicant company would be polluted even by the single fact that the respondent would appear to be above discipline; and (6) the fact that the applicant would seem to have lost control over its servants could cause instability.
I have already said that the grounds of appeal as formulated against the interlocutory injunction which makes it impossible for a master to discipline his servant are in my view substantial. The issue which is of a fundamental nature to be decided in the appeal is whether in an ordinary master and servant relationship, the servant can protect his employment by an injunction against his master. I think the court even at this stage will permit an appellant seeking to stay the effect of such an injunction to demonstrate that his appeal has merit. That could go a long way in assisting the court to exercise its discretion in the right manner without really deciding the merits of the appeal at that stage. As said by the Supreme Court in Josien Holdings Ltd. v. Lornamead Ltd. (1995) 1 NWLR (Pt.371) 254 in the observations at page 264 per Kitugi JSC in his leading judgment:
“The court below was however perfectly right when it stated that a court should not deal with the merits of a matter at the stage of an interlocutory application, but that is not the same thing as saying that an applicant for a stay or injunction pending appeal is not permitted to demonstrate or show that his appeal has merit. No, that is not correct. Where grounds of appeal exist suggesting a substantial issue of law to be decided on the appeal and where either side may have a decision in his favour a stay will be ordered..
Invariably an application for stay or injunction pending appeal would be refused where the appeal is a frivolous one.”
In the said case of Josien Holdings Ltd. v. Lornamead Ltd. (supra), an application was made to stay some injunctive orders pending the determination of the appeal against them. At page 267 the learned Justice said:
“The practice clearly is that whenever it appears, that where an injunction is granted, as in this case, considerable damage would be done pending appeal to a defendant by the stoppage of his business which could not be compensated, the injunction is stayed on terms.”There is no doubt that when an appeal is pending against an interlocutory (or any interim) injunction, and there are reasons which make it necessary for the court to exercise its discretion to intervene in the meantime, the injunction may be stayed or suspended before the appeal is determined.
The court, apart from observing the known principles applicable to such exercise of discretion, will need to be practical and ought not to be dissuaded by the argument that such intervention would undermine the appeal. It may well be obvious to the court that an intervention would save undue hardship or inconvenience to, or a situation of great concern for, the applicant for which In any event it is considered that damages will assuage the respondent but not the applicant. It is recognized that damages for disruption of business is difficult to assess and therefore that fact must be taken into account as an issue of balance of convenience: see Merchant Adventures Ltd. v. MGrew & Co. Ltd. (1972) Ch. 241 at 256. I think it is a disruption of an ordinary employer’s business to fetter him with an injunction not to discipline his servant. Again, it has been held that the court has power, on the application of the defendant, to dissolve or discharge an injunction which the plaintiff has obtained if, for instance, it subsequently becomes apparent that the injunction was founded on a decision which was wrong in law: see Regent Oil Co. Ltd. v. J.T Leavesley (Lichfield) Ltd. (1966) 2 All ER 454. It is also not in doubt that an injunction may, by application to do so, be suspended: see Shelfer v. City of London Electric Lighting Co. (1895) 2 Ch. 388.It follows, in my view, that the fact of the pendency of an appeal against an injunctive order does not preclude the court from intervening, when desirable, to relieve its effect before the appeal is determined. It could either be stayed or suspended as the occasion demands. The court must react to the situation with a practical approach and, without necessarily doing injustice to either party, do what is considered equitable; and if that leads to the stay or suspension of the order, it may also decide that equity demands that it should be granted upon terms where appropriate. I think it would be a reproach to the administration of justice if the court were to remain helpless in a situation where great hardship is caused by an interlocutory injunction, or where, for instance, it is plain that it ought not to have been granted at all, and there is immense delay in having the appeal against it set down for hearing.
I recall that before this motion was argued on 2 July, 1988. Mr. Ukiri for the respondent drew our attention to a notice of preliminary objection to the motion. We decided that both the objection and the motion be argued together. Dr. Mowoe SAN then argued the motion on behalf of the applicant. Mr. Ukiri argued in opposition and Dr. Mowoe replied. Mr. Ukiri did not formally argue the preliminary objection so that Dr. Mowoe would respond to him although before we took the position that it should be argued along with the motion, he had casually recounted what the objection was about. I believe it should be taken that Mr. Ukiri abandoned the objection. In case he thought what he recounted amounted to argument, I would not have considered calling on Dr. Mowoe to respond because having myself perused the said notice of preliminary objection, I do not think the objection has any merit.
In the present case, I cannot speculate on the steps the applicant may contemplate to enforce discipline in its business, or in particular what disciplinary action it may wish to take as regards the respondent. I am. However, satisfied that the interlocutory injunction ordered against the applicant which made it impossible for it to embark on any such action ought in the circumstances of this case to be suspended. Accordingly, I hereby suspend forthwith the order made by Okor J on 19 January, 1998 in suit No. PHC/1512/97 pending the determination of the appeal by this court against the said order. I do not see what appropriate terms can be imposed and therefore I impose none. I also make no order for costs.
Other Citations: (1998)LCN/0381(CA)
