Taiwo Okeowo & Ors V. Mrs D.a Migliore & Ors (1979)

LawGlobal-Hub Lead Judgment Report

G. IRIKEFE, J.S.C.

This appeal deals with two rulings, namely:(a) that dated 27th June, 1977 by Belgore, J.and (b) That dated 25th November, 1977 by the same Judge.

The latter ruling as will appear hereafter in the judgment, was aimed at facilitating the implementation of the order made in the earlier ruling. At its inception, this matter ran into the teeth of formidable procedural opposition, which progressively lost its sting in the course of its journey through the Federal Revenue Court was invoked by the respondents herein by means of an originating summons which reads:

“Let all the parties concerned attend one of the Judges sitting at the Federal Revenue Court, Lagos on Monday the 18th day of April, 1977 at the hour of9 o’clock in the forenoon on the hearing of an application by the above-named applicants who are directors of the above-mentioned company , METAL CONSTRUCTION (WEST AFRICA) LIMITED;

(i) For a declaration that the 4th defendant’s appointment as Secretary to the said company is illegal, null and void and should be set aside;

(ii) That directions may be given as to the manner in which a meeting of the board of the said company may be summoned, held and conducted for the purpose of considering and if thought fit, passing the following resolution:

“That Mr. E. Olatunde Ayoola, Chartered Accountant, be and he is hereby removed as Secretary of the Company and that Mr. O.O. Ede, Legal Practitioner, be and is hereby appointed Acting Secretary of the Company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr. O.O. Ede all the company’s properties in his possession. ”

(iii) That all such ancillary and consequential directions may be given as the Court thinks fit.”

The appellants promptly moved the Federal Revenue Court to set aside or strike out the originating summons because, according to the contention of their counsel, an originating summons was inappropriate for this type of matter, adding that the correct procedure was by issuing a writ of summons.

The divers applications are supported by a mass of affidavit evidence which are set out in chronological order in the lead judgment, which has just been read by my learned brother, ANIAGOLU, J.S.C. Accordingly, I propose to confine myself to carrying only those portions of the evidence as are material in my contribution to this judgment.

The company, METAL CONSTRUCTION (WEST AFRICA) LIMITED, was incorporated in 1958 and by March, 1974, the entire authorised share capital were held by Sergio Migliore to the tune of 187,500 shares of N2 each and Delia Migliore (his wife) 12,500 shares. Both are Italian nationals. With the promulgation of the Nigerian Enterprises Promotions Decree (No.4 of 1972) now repealed and re-enacted as Decree No.3 of 1977 of the same name, it became compulsory for the Italian proprietors of the company to shed 40% of their share-holding to Nigerians. These shares were taken up by the 2nd and 3rd appellants herein in the percentage of 35 and 5 respectively. When this matter arose in 1977, the share-holding in the company was as follows:

NAME SHARES % HOLDING

POSITION IN COMPANY

MR. SERGIO MIGLIORE 107,500 53.75

Deceased

MRS. D.A. MIGLIORE 8,500 4.25

Chairman

MR A. MANGILI 2,000 1.00

Managing Director

MRS. MANGILI 2,000 1.00

Director

MR. T. OKEOWO 70,000 35.00

Executive Vice-Chairman and

Finance Director

Mrs.OKEOWO 10,000 5.00

Director

Mr. Sergio Migliore died intestate in Italy in October 1974 and letters of administration in respect of his personal property were granted to his widow, Mrs. D.A. Migliore and her brother, Mr. A. Mangili, both of whom are respondents in this matter.

The appellants before us do not now challenge the procedure by which these proceedings were commenced and Belgore J. on 27th June, 1977 ruled inter alia as follows, on the respondents’ application:

“The company has therefore the authority to appoint a Secretary. Having regard to the circumstances of this case as established by the evidence considered earlier in this ruling, I make the following orders:

(1) That the 4th respondent Mr. E.O. Ayoola do, within one week from today convene a meeting of the company consisting of all the members who are:

MRS. D.A. MIGLIORE

MR. TAIWO OKEOWO

MR. A. MANGILI

MRS. G. OKEOWO

MRS. C. MANGILI

(2) That the meeting do consider a resolution about removal of the present Secretary of the company and the appointment of a new temporary or permanent one.

(3) That all the requirements as to length of notice for calling a meeting of the company will not apply to the calling of this meeting.

(4) That Mr. E. Ayoola do hand over to the Secretary if one is appointed all company properties with him as a Secretary. That Mr. E. Ayoola should report back to this court through affidavit the calling and the result of the deliberation of the meeting so called.

(5) That the affidavit ordered in 4 above should be filed in the Registry of this court within 14 days from today. ”

One of the main complaints by the respondents (the Italian shareholders)was that the 4th appellant (Mr. E.O. Ayoola) had been refusing to summon meetings of the company and only accepted instructions issuing from the Okeowo faction (the Nigerian share-holders). As to these allegations, the learned Judge made the following findings of fact in support of his orders hereinbefore set out:

“(a) From the evidence before me I accept that the 4th respondent has been refusing or avoiding to summon a meeting of the board.

(b) On the evidence before me which I believe, I hold that Mr. E.O. Ayoola the 4th respondent is the Secretary of the company.

Section 128 reads: …

It was the interpretation of this section that the learned counsel for 2 to 4th respondents based his main objection to the originating summons. He stated that the section only empowered the court to order a meeting of the company and not that of the board of directors. On the facts of the present case such argument is academic. In paragraph 2 of the affidavit supporting the originating summons five names are given as those of the directors of the company while in paragraph 15 of the counter-affidavit of the 2nd respondent the same five names are given as those of the shareholders of the company. The difference between members of the company and members of the Board of Directors is the difference between six and half a dozen.”

The respondents’ desire to utilise the voting power of the late Sergio Migliore who held 53.75% of the shares in the company at the meeting ordered by the court in its ruling of 27th June, 1977 prompted the subsequent application by them for leave to vote at that meeting int heir own right and also in the right of the deceased shareholder.

The court granted the order sought in its ruling of 25th November, 1977 in the following terms:

“The 1st and 2nd applicants are to vote at any meeting of the company not only on their own right as shareholders but in addition as persons entitled to the shares of the deceased Sergio Migliore. ”

The two issues on which the appellants rested their case at the Court of Appeal were:

(a) Whether an originating summons was appropriate for instituting the instant proceedings and

(b) Whether the learned Judge in the Federal Revenue Court was right in ordering a meeting of the company when the respondents had asked for a meeting of the board of directors.

The Court of Appeal resolved both issues in favour of the respondents and hence this final appeal.

As I had indicated earlier on, the appellants in the appeal before us do not now contest the propriety of instituting these proceedings by originating summons. They also do not now wish to assert that the Secretary of the company was O.A. Management Services and not E.O. Ayoola, Esq. Their case thus falls to be determined on the only relevant ground of appeal which reads:

“1 (a) The learned Judges of the Federal Court of Appeal misconstrued or failed to give effect to the provisions of Section 128 of the Companies Decree and thereby came to a wrong decision.

(b) The learned Judges of the Federal Court of Appeal erred in law and on the facts in failing to observe that the respondents did not establish that the conditions precedent to the exercise of the powers vested in the Federal Revenue Court pursuant to Section 128 of the Companies Decree existed or had arisen in this case.

Particulars of misdirection and error alleged in grounds 1 (a) and 1 (b)

(i) The jurisdiction of a court to order the meeting of a company pursuant to powers vested in it under Section 128 of the Companies Decree can only arise in two situations: firstly, where for any reason it is impracticable to call a meeting of that company in any manner in which meetings of the company may be called and, secondly, where for any reason it is impracticable to conduct the meeting of the company in the manner prescribed by the Articles or the Companies Decree.

(ii) The allegation in the affidavit in support of the originating summons that the 3rd appellant (E. Olatunde Ayoola) failed, refused or neglected to summon a meeting of the company at the instance of the respondents is insufficient to establish any of the situations herein-before mentioned.

(iii) The articles of Association as well as the Companies Decree made it practicable to call a meeting of the company.

Chief Williams, S.A.N., both in his brief and argument before us submitted that “impracticability” within the con of Section 128 of the Companies Decree is a burden that must be discharged by the respondents in this case and that this had not been done. He again argued that, it being agreed by the parties that a meeting of the company is not the same thing as a meeting of its board of directors, the court had erred in making an order convening a meeting of the company when what the respondents had expressly asked for was a board meeting. He further argued that the order made was prejudicial to the interests of the appellants who were entitled to meet only the case in respect of which they had been brought to court. Alternatively, he argued that if the court were minded to make the order it did make, then an application for an amendment of the relief sought ought to have been made and the appellants afforded an opportunity to comment thereon. Learned counsel further argued by reference to sections in the Articles of Association that if, as established in this case, the 3rd appellant (E. O. Ayoola) had refused to summon a meeting of the company, there was nothing to inhibit the summoning of one by the respondents. In sum, it is plain that learned counsel is of the firm view that a case for the exercise of the court’s powers under Section 128 of the Companies Decree had not arisen.

Mr. Sofola, S.A.N., for the respondents while admitting that he was in error to have asked for a meeting of the board of directors while in fact he should have asked for a meeting of the company, nevertheless argued that in the peculiar circumstances of this case, the order of the Federal Revenue Court should be affirmed. He argued further that the schism in the company had taken on an immense dimension and drew our attention to matters from which “impracticability” within the con of Section 128 of the Companies Decree could be, and was rightly inferred by the Judge of the Federal Revenue Court. He stated by reference to the record that there was no agreement as between the parties on the quantum of share-holding as also on counsel. It is conceded by the parties and clear on the record that the compnay involved in this case has not opposed the order sought by the respondents. It has also not appealed. The contest is between the Italian share-holders on the one side and the Nigerian share-holders ont he other. It seems to me that, upon a dispassionate appraisal of all the evidence in the case, the intervention of the court having regard to the facts found by the learned Judge could not have been avoided and that the order made pursuant to Section 128 of the Companies Decree was correct. In EL SOMBRERO LTD. (1958)3W.L.R.page351- Wynn-Parry J. considered the scope of the word “impracticable” thus:

“It is conceded that the word “impracticable” is more limited than the word “impossible”; and it appears to me that the question necessarily raised by the introduction of that word “impracticable” is merely this: Examine the circumstances of the particular case and answer the question whether, as a practical matter, the desired meeting of the company can be conducted, there being no doubt, of course, that it can be convened and held. ”

Section 135( 1) of Companies Act 1948 of the United Kingdom with which Wynn-Parry J. was dealing is in pari-materia with our Section 128 of the Companies Decree-1968.

I am satisfied that there is no merit in this appeal and I would dismiss it. Although learned counsel for the appellants has asked this court not to take into consideration the evidence given before the single Judge of the Federal Court of Appeal (Coker J.C.A.) in determining this appeal, we have seen the said proceedings since they form part of the record (having been specifically requested by counsel while settling the record that they should form part of the record of this appeal). Although we have not taken that part of the proceedings into consideration in determining this appeal, we have seen the remarks made in the said proceedings in regard to exhibit 003; and we think that the attention of the Attorney-General of the Federation and the Director of Public Prosecutions, Lagos State, ought to be drawn to the said proceedings with particular reference to exhibit 003 so that they may take such action as they may deem fit in the circumstances. Accordingly it is hereby ordered that the entire proceedings before Coker, J.C.A in FRC/L/ M.40/77 be forwarded by this court to the Attorney-General of the Federation of Nigeria and the Director of Public Prosecutions, Lagos State respectively.

The orders made by Belgore J. in these proceedings in his rulings of 27th June, 1977 and 25th November, 1977 respectively, already affirmed by the Court of Appeal, are hereby re-affirmed.

Appeal is dismissed. The respondents are awarded N300 costs against the appellants.

A. N. ANIAGOLU, J.S.C.: The question calling for a determination in this appeal is one of law and centres around the proper interpretation of, and a determination of the limits of the power of a Court, under S.128(1) of the Companies Decree, 1968 which provides that:

“If for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called, or to conduct the meeting of the company in the manner prescribed by the articles or this Decree, the court may, either of its own motion or on the application of any director of the company who would be entitled to vote at the meeting, order a meeting of the company to be called, held and conducted in such manner as the court thinks fit, and where any such order is made may give such ancillary or consequential directions as it thinks expedient; and it is hereby declared that the directions that may be given under this subsection include a direction that one member of the company present in person or by proxy shall be deemed to constitute a meeting. ”

The Respondents, by Originating Summons dated 12th April 1977 taken out in the Federal Revenue Court, Lagos, had applied:

“(i) For a Declaration that the 4th Defendant’s appointment as Secretary to the said Company is illegal, null and void and should be set aside;

(ii) That Directions may be given as to the manner in which a Meeting of the Board of the said Company may’ be summoned held and conducted for the purpose of considering and if thought fit passing the following Resolution:

“That Mr. E. Olatunde Ayoola Chartered Accountant be and he is hereby removed as Secretary of the Company and that Mr. O.O. Ede Legal Practitioner be and is hereby appointed Acting Secretary of the Company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr.O.O. Ede all the Company’s properties in his possession.”

(iii) That all such ancillary and consequential directions may be given as the Court thinks fit.

(iv) That the costs of this application may be provided for.”

The Summons was heard in the Federal Revenue Court by Belgore, J., who in his Ruling of the 13th day of June 1977 held that the procedure of Originating Summons was improper for seeking the relief in item one (that is, the one dealing with the 4th defendant’s appointment as Secretary) and therefore struck that item out. He proceeded with the other items on which, on 27th June 1977, he made the following Orders:

“(1) That the 4th Respondent Mr. E. O. Ayoola do, within one week from today convey a meeting of the Company consisting of all the members who are:

Mrs. D.A. Migliore

Mr. Taiwo Okeowo

Mr. A. Mangili

Mrs. G. Okeowo

Mrs. C. Mangili

(2) That the meeting do consider a resolution about removal of the present Secretary of the Company and the appointment of a new temporary or permanent one.

(3) That all the requirements as to length of notice for calling a meeting of the Company will not apply to the calling of this meeting.

(4) That Mr. E. Ayoola do hand over to the Secretary if one is appointed all Company properties with him as a Secretary. That Mr. E. Ayoola should report back to this Court through affidavit the calling and the result of the deliberation of the meeting so called.

(5) That the affidavit ordered in 4 above should be filed in the Registry

of this Court within 14 days from today.

This matter is adjourned to 4th day of July, 1977.”

Not only had the Appellants challenged the procedure of initiating these proceedings by Originating Summons, they also complained that even if the Originating Summons procedure was correct, the Federal Revenue Court had no jurisdiction to make the Orders it made since the Applicants in the Summons had applied for directions as to the manner in which a meeting of the Board of the Company may be summoned and not as to the manner in which a meeting of the Company may be summoned. The Court having given directions for the calling of a meeting of the Company (which was not asked for by the Applicants in their Summons), they said, it acted without jurisdiction since, by law, it cannot go outside the claims of an Applicant to grant relief not asked for. It is upon this contention that the Appellants, in their brief, have framed the questions for the determination of this Court in this appeal as follows:

“The questions, which will arise for determination at the hearing of this appeal may be summarised as follows:

(a) In what circumstances or situations are the powers conferred on the Court by Sec. 128 of the Companies Decree 1968 to direct a meeting of a company to be called, held or conducted exercisable

(b) Was the Federal Revenue Court right in making the order directing Mr. E. O. A yoola to convene a meeting of the Company when the prayer on the Originating Summons was for an Order that directions may be given as to the manner in which a meeting of the Board of the said Company may be summoned

(c) Was there evidence before the court that such circumstances or situations existed in this case when the orders and directions made by the court pursuant to its powers under the Section aforesaid were made”

All these legal questions have arisen against the background of a miscellany of facts, deposed to by the parties, which have sent the record of proceedings running into hundreds of pages. I would attempt to put these facts together and, in so doing, give some semblance of a chronological account of the course of this case from its initiation to the last judgment from which appeal has come to this Court.

The Company, the Metal Construction (W.A.) Ltd., is incorporated under the Companies Decree, 1968. All the Applicants and the Respondents, barring E. Olatunde Ayoola the 4th Respondent who is the Secretary, are members and Directors of the Company. The issue of the directorship of the first and second Applicants (Mrs. D .A. Migliore and Mr. Airaldo Mangili) has been dealt with in the sister case between the same parties, reported in (1979) 6-9 S. C. at page 163. Problems having arisen between the parties about the calling and conduct of meetings, the Applicants, on 12th April 1977 , took out this Originating Summons asking, inter alia, for Court’s directions. Promptly, on 15th April 1977 , the Respondents filed a Motion asking the Court to set aside and/or strike out the Originating Summons because it was not a proper procedure for initiating the proceedings or, in the alternative, direct the Applicants to commence the proceedings by filing a writ of summons. Ruling was given on 13th June 1977. In the Ruling the Motion was upheld in respect of the first relief dealing with declaration that the 4th defendant’s appointment as Secretary to the Company was irregular, null and void. That relief was struck out. In respect of the other reliefs argument was heard on 23rd June 1977 and on 27th June 1977 another Ruling was made. The Court, as had already been stated, ordered the 4th Respondent, Mr. E.O. Ayoola, to convene a meeting of the Company consisting of all the members. The meeting was to consider a resolution about the removal of Mr. A yoola as Secretary of the Company and the appointment of a new one. The requirements as to the length of notice of calling a meeting of the Company was ordered to be dispensed with in the calling of that meeting. Mr. Ayoola was to hand over to the secretary appointed all Company properties in his possession as Secretary and was to report back to the Court, by means of affidavit, about the calling of, and the result of the deliberations at, the meeting.

By a Motion filed on 30th June 1977 the 2nd to 4th Respondents (Taiwo Okeowo, Mrs. G. Okeowo and E. Olatunde Ayoola) applied for leave to appeal from the Ruling of the Federal Revenue Court and also for a stay of execution. The matter was argued on 14th July 1977 and on 4th November 1977 Ruling was made by the Revenue Court, which granted the application for leave to appeal but refused the application for a stay of execution.

In the meantime Mrs. Migliore and her group had filed a Motion dated 4th July 1977 seeking the order of the Revenue Court giving directions that she and Mr. Mangili should vote at the Company’s meeting scheduled for Saturday, 11th July 1977 at 11 a.m. or at any adjourned or other meeting of the Company. This Motion was argued on 8th November 1977 and on 25th November 1977 the Court, in a considered Ruling granted the application.

The Okeowo faction of the respondents filed a Motion dated 29th November 1977 seeking leave of the Federal Revenue Court to appeal against the said Ruling and for stay of execution. When the application came for hearing.

On 19th December 1977 Chief Williams, for the said Okeowo faction of the Respondents, withdrew his application for stay of execution. The Court proceeded to grant, and did grant, leave to appeal to the Federal Court of Appeal.

On 18th September 1978 Mrs. Migliore and her group applied in the Federal Court of Appeal, by Motion on Notice, for special leave for that Court to hear fresh or further evidence. There appears to be some confusion in dates at this stage because a single Judge of that Court (Coker, J.C.A.) started hearing the evidence on 11th July 1977 and went through copious proceedings in which Taiwo Okeowo, Edmund Olatunde Ayoola and Delia Migliore gave lengthily evidence on how the Company came about, the interest and the share holdings of the various parties. Justice Coker, made his considered findings on 28th July 1977 which were clearly adverse to the Okeowo faction. Be that as it may, the appeals came before the Full Court (Ogunkeye, Coker and Okagbue JJ.C.A.) of the Federal Court of Appeal on 5th October 1978. Lengthy arguments were heard and on 13th December 1978 a lengthy Ruling was made in which the two appeals filed by the Okeowo faction to that Court were dismissed. Against this Ruling the Okeowo group, by Motion on Notice dated 18th December 1978, applied to the Federal Court of Appeal forleave to appeal to the Supreme Court complaining that the Justices of the Federal Court of Appeal misconstrued or failed to give effect to the provisions of S .128 of the Companies Decree, and failed to observe that the Respondents had failed to establish that the conditions precedent to the exercise of the powers vested in the Federal Revenue Court, pursuant to S.128 of the Companies Decree, had not arisen or had not been established. The Ruling of the Court was delivered by Okagbue, J.C.A. The Court stated its inclination to refuse leave to appeal but said it was granting leave because of Counsel’s insistence that the issue in dispute was a matter of public interest and that a serious question of law was involved and should be determined by the Supreme Court. Leave was thereforegranted. Thereafter, Appellants’ Counsel filed his Notice and Grounds of Appeal. Subsequently, on 18th September 1979, his brief was filed to which the Respondents’ brief dated 12th October 1979 was also filed. A reply brief (undated) to the Respondents’ brief was later filed.

Appellants, in their brief, abandoned their contest of the propriety of initiating these proceedings by Originating Summons. They also abandoned their contention, on which they filed copious documents and argued in extenso, that the Secretary ofthe Company was not E.O. Ayoola but O.A. Management Services Ltd. As has already been stated they restricted their contest before this Court on the propriety and jurisdiction of the Federal Revenue Court in giving the directions it ordered having regard to the provisions of S.128 of the Companies Decree, 1968. Such were the facts upon which this appeal was based and the journey of the proceedings from the Federal Revenue Court to the Supreme Court.

Arguing the appeal before us Chief Williams, S.A.N., took his points in two parts. First, affirmatively and secondly, in the alternative. In his affirmative argument he contended that Section 128 of the Companies Decree applies to the calling of a meeting of a company and not a calling of a meeting of a Board of a Company. In his alternative argument he said that the Court has power, suo moto, under that section, to order the calling of a meeting of a company but then only when it has been shown to the satisfaction of the Court that the calling or the conducting of such a meeting, in any manner in which meetings of the company may be called or conducted in accordance with the articles of the company or the provisions of the Companies Decree, 1968, “is impracticable”. He emphasised that impracticability is of the essence – an essence which is a condition precedent before a Court can exercise its power to order the calling or to give directions for the conducting, of a meeting of the company. Section 128, being concerned with meetings of a company and not with meetings of a board of a company, and impracticability not having been established, the Federal Revenue Court, he contended, had no jurisdiction to make the order it made. To emphasise his point he drew our attention to the fact that the applicants made their application for directions for the calling and conducting of a meeting of the board showing clearly that the applicants were well aware that what they had in mind was a board meeting and not a company meeting.

He referred to several sections of the Companies Decree, 1968, notably sections 122, 125(1) and 395(1) in amplification of his points. Also references were made by him to Article 89 of the Articles of Association of the Company; section 11 of the Federal Revenue Court Decree, 1973 and to the decision in Re Express Engineering Works Ltd. (1920) 1 Ch. 466.

Counsel for the Respondents, Mr. Kehinde Sofola, S.A.N., relied on his brief and contended before us that there was no substance in the appeal. He argued that the meaning ascribed to the word “impracticability”, as contained in section 128 of the Companies Decree is that which is found in the (1975) 2nd Edition of Websters New 20th Century Dictionary where it is defined as “not capable of being carried out in practice”; or “not capable of being managed or dealt with”. In view of the serious split in the company resulting in the Secretary taking sides or taking dictation from one side, supported by the attitude of the Appellants, there was, he said, ample evidence of “impracticability”. In the circumstances, he submitted, the Judge was right in ordering a meeting of the company even though the summons asked for a meeting of the Board. He consIdered that he ought to have asked for a meeting of the company because the appointment of the Secretary was done by the company and there was nothing in the Articles stating who should appoint the Secretary. He argued that since there was no delegation of power of appointment of the Secretary to the Board, the power therefore rested in the company. Since it was the company that should appoint the Secretary, the Judge was right in ordering a meeting of the company. He called in aid sections 152 and 169 of the Companies Decree; Articles 82 and 89 of the Company’s Articles; and the decisions in Re Express Engineering Works Ltd. (supra) and in Re Duomatic Ltd. (1969) 2 Ch.365.

Replying to Respondents’ argument Chief Williams maintained that an appeal court in doing justice must bear in mind the basis on which a case was fought. It would not be right, he contended, that a case should be made for the first time in this court. The Respondents, he said, asked for a Board meeting in the court. The Respondents, he said, asked for a Board meeting in the court below and should not be allowed to set up a case of company meeting in the Supreme Court. In concluding his argument he referred to the decision in Paul Iro v. Robert Park & 5 ors (1972) 1 All N.L.R. (Part 2) p.474 at 479.

The Company (4th Respondent) was not represented in this appeal, but the record of proceedings at pages 80-81 shows that before Belgore, J., the Company was represented by Mr. Ogunade, of Counsel, who supported the application of the Applicants and was there recorded by the Judge as saying:.

“I refer to Exhibits MM3, MM5 and MM7 to show the difficulty in summoning a meeting. The person suffering as a result of the Secretary’s attitude is the Company – the 1st Respondent. The Annual General Meetings and other Statutory Meetings are not called which is not only bad for the Company but is illegal. I support the application that the Court directs the calling of a meeting.”

Dealing with the Appellants’ contention that the Originating Summons asked for directions for the calling of a Board meeting and not the calling of a meeting of the Company, Belgore, J., dismissed the argument as academic because the same members who constituted the Board were precisely the members who constituted the Company. After setting out the provisions of section 128 of the Companies Decree, he held:

“It was the interpretation of this section that the Learned Counsel for 2 to 4th Respondents based his main obejction to the originating summons. He stated that the Section only empowered the Court to order meeting of the Company and not that of Board of Directors. On the facts of the present case such argument is academic. In paragraph 2 of the affidavit supporting the originating summons five names are given as those of the Directors of the Company while in paragraph 15 of the Counter affidavit of the 2nd Respondent the same five names are given as those of the share holders of the Company, the difference therefore between members of the Company and members of the Board of Directors is the difference between six and half a dozen.”

The Federal Court of Appeal, before which the same argument was placed by Chief Williams, while conceding that generally a relief not sought by a party should not be given him, supported the ruling of the Federal Revenue Court on the issue. It quoted with approval the above portion of the Ruling of the Federal Revenue Court and stated that even if the application was for the calling of a meeting of the Board no harm could have been done if the Court ordered, as it did, that a meeting of the Company rather than the Board be called since the same people are involved in both cases. In concluding that aspect of the case the Federal Court of Appeal observed:

“Even if technically, this might be described as a relief not asked for we think that in the special circumstances of this case and in view of the powers of the Court, suo moto, to order that a meeting of the Company be called under section 128 of the Companies Decree 1968, the complaint under this head cannot be sustained. We bear in mind the provisions of section 11 of the Federal Revenue Court Decree 1973…”

On the issue that the order made by the Federal Revenue Court was wider than the relief sought the Court of Appeal rejected the complaint.

Having read the entire record of proceedings in this case and the briefs filed, and having heard extensively argument of Counsel in this appeal, I find it difficult to resist the decision to agree with Counsel for the Respondents, in his conclusions, at pages 5 and 12 of his brief. At p.5 paragraph 1, under “COMMENTS ON THE APPEAL “, he said:

“This is an extremely complicated history of litigation. It is evident that the appellants have been astute to take every conceivable technical point to prevent the applicants from establishing through the Courts their rights to the controlling interest in the Company.”

Under “ARGUMENTS IN REPLY TO THE APPEAL” paragraph 12 at p.12 he submitted as follows:

“In the peculiar circumstances of this case, the Federal Court of Appeal was right in dismissing the Appeal as the learned trial judge was obliged to do substantial justice and to give necessary relief or remedy for the wrong complained of, an exercise which is in the best interest of all the parties and the Company in particular.” Which is apparent from the evidence has been unnecessarily bugged down in complex legal technicalities and the Court was obliged to avoid giving any further opportunity to the raising of time wasting technical points.”

We are treated in this case to a scenario of monumental injustice being perpetuated by Taiwo Okeowo and E. Olatunde Ayoola (1st and 3rd Appellants) against 1st, 2nd and 3rd Respondents (who I refer to as the Mrs. Migliore group) under a canopy of a barrage of legal technicalities aimed by them at ultimately ousting, or drastically reducing the share holding of, the Mrs. Migliore group and controlling the Company. One is unhappily reminded, in this regard, of the reproaches of Charles Dickens in his satirical book, BLEAK HOUSE, in which, in the imaginary case of Jarndyce v. Jarndyce, justice was submerged in a heap of applications of Solicitors as they were ranged, he said:

“In a line with bills, cross-bills, answers, rejoinders, injuctions, affidavits, issues, references to masters, masters’ reports, mountains of costly nonsense filed before them . . . There they were in the long matted well of the Court, but you might look in vain for truth at the bottom of it. This is the Court of Chancery which gives to monied might the means abundantly of wearying out the right; which so exhaust finances, patience, courage, hope; over-throws the brains and breaks the heart that there is not an honourable man among its practitioners, who would not give – who does not often give – the warning ‘suffer any wrong that can be done you, rather than come there!’.”

My Lords, the laws of our land enjoin us, that while respecting procedural regularity, we must do substantial justice, with power to make amendments which we deem fit, or not to make them, as the occasions demand. I conceive that this case is one in which we must do substantial justice, technicalities notwithstanding.

The Company (the 4th Respondent) is made up of only five members who are also its five directors namely: the 1st and 2nd Appellants and the 1st, 2nd and 3rd Respondents. Small as their number is, there is a serious rift in their ranks, the 1st and 2nd Appellants together with the Secretary of the Company, E. Olatunde Ayoola, constituting one faction, while the 1st, 2nd and 3rd Respondents constitute the other faction. All this is clear from the facts placed before the Court. The fact of this rift underlies the issue of “impracticability” of calling a meeting of the Company as provided for in S.128 of the Companies Decree, 1968.

Article 89 of the Articles of Association of the Company gives to any Director of the Company power to call for a meeting of the Board and stipulates that the Secretary “shall” at the request of any Director summon a meeting of the Board. The Article reads:

“Any Director may at any time and the Secretary shall at the request of any Director summon a meeting of the Board. Any Director described in the Register by an address not within Nigeria shall be entitled to have notices of meetings of the Board served upon him at that address by telegram or cablegram and also at his address (if any) within Nigeria.

“In actual practice, whether it is the Director who is himself calling, or he is requesting the Secretary to call, a meeting of the Board, it amounts to the same thing for it is the Secretary who will gather the facilities for the holding of the meeting and take record of the minutes of the meeting. S.169(1) of the Companies Decree, 1968, provides for the office of a Secretary in a company. But as has been stated in Volume 1 of 22nd Edition of Palmer’s Company Law paragraph 64-08 at p. 721 the duties of a secretary vary with the size and nature of the company and the terms of the arrangement made with him. Apart from certain statutory duties, such as the making of the statutory declaration in respect of a company formed as a public company before the commencement of busienss; the signing of annual returns; the verification of the statement to be submitted to the official Receiver in the case of a winding up of the company by court, or in the case of the receiver being appointed by debenture holders whose debentures are secured by a floating charge on substantially the whole of the company’s assets; and to sign the prescribed form of application where a limited company applies to be re-registered as unlimited and vice versa – the duties of the secretary of company are not fixed by law. And so it is with the Metal Company the subject-matter of these proceedings.

But the evidence on record shows that the Secretary, so found to be the Secretary by the Federal Revenue Court, Mr. Ayoola, had arrogated to himself so much of the functions pertaining to the Company that he not only acted as the Secretary but also as the chartered accountant in the latter capacity of which he sent fabulous bills for accounting work done, as could be seen from annexures MM1 to MM10 at pages 7 to 28 of the record.

Delia Alessandra Migliore swore to an affidavit dated 14th April 1977 in which she showed clearly that there was a serious rift among the members of the company. Paragraphs 2, 9, 10, 11, 12, 15 and 16 of the said affidavit which point to this rift read:

“(2) That the following members are the Directors of the Company:

Mrs. D.A. Migliore – Chairman

Mr. Taiwo Okeowo – Vice-Chairman

Mr. A. Mangili – Managing Director

Mrs. G. Okeowo – Director

Mrs. C. Mangili – Director

(9) That Article 89 of the said Articles of Association of the Company provides as follows:

“Any Director may at any time and the Secretary shall at the request of any Director summon a meeting of the Board. Any Director described in the Register by an address not within Nigeria shall be entitled to have notices of meetings of the Board served upon him at that address by telegram or cablegram and also at his address (if any) within Nigeria. ”

(10) That several requests both verbally and in writing have been made to the 4th Respondent to summon meetings of Directors of the Company but he has refused to do so. For example, we drove to his office at Ilupeju and requested him to summon a Board meeting for 22nd March 1977 to which he agreed but he did not show up and he did not summon the meeting.

(11) That we sent written requests to him but he instructed his staff to refuse to accept them or to return them and attached herewith and marked “MM3” is a photostat copy of a letter dated 24th March 1977 returning one of our letters of request to summon a Directors’ Meeting.

(12) That our Solicitor wrote a letter to him on 19th March 1977 and he wrote a reply dated 21st March 1977 summoning a Board meeting for 4th April 1977 “to comply with the Court Order made on 18th March 1977” by His Lordship, the Honourable Mr. Justice M.B. Belgore for the delivery of a Share Certificate to the 1st and 2nd Applicants as Administratrix and Administrator of the deceased Shareholder, the late Sergio Migliore, following an Originating Summons filed when the 2nd Respondent proposed drastically to alter the Articles of Association of the Company to secure for himself substantial personal advantage to the detriment of the other Directors with the active collaboration of the 4th Respondent, Photostat copies of the said letters are attached and marked “MM4” and “MM5” respectively.

(15) That the 4th Respondent takes dictation only from the 2nd Respondent and from nobody else as evidenced by the attached notice dated 6th April, 1977 marked “MM8” purporting to postpone a meeting already summoned for 4th April 1977 .

(16) That the 4th Respondent has not been acting in the interest of the Company but to feather his own nest and attached herewith and marked “MM9″ are 10 photostat copies of his bills between 1971 and 1977.”

Taiwo Okeowo, in his reply affidavit denied Mrs. Migliore’s assertions. Indeed, he even denied the share holding of Mrs. Migliore, allotting to her only 4.25% as her shares in the Company. For their importance I reproduce paragraphs 9, 12, 13 and 15 of his affidavit which are the ones posing the greatest challenge to the averments of Mrs. Migliore:

“(9) That with regard to paragraphs 10 and 11 of the said affidavit, the 4th Respondent informed me and I verily believe that there has been no time that the Secretaries to the Company have been requested to summon a meeting of the Board of Directors which the Secretaries have not done in accordance with Article 89 of the Articles of Association of the Company as quoted in paragraph 9 of the said affidavit.

(12) That it is not true that the 4th Respondent takes dictation only from me and from nobody else as alleged in paragraph 15 of the said affidavit as there have been several occasions when other directors of the Company have given instructions to him.

(13) That it is not true “that the 4th Respondent has not been acting in the interest of the Company but to feather his own nest” and that the bills attached to the said affidavit and marked “MM9” are for substantial work done for the Company which work had to be done anyway.

(15) That as of the present, the share holding position of the Company is as follows:

Mr. Taiwo Okeowo (2nd Respondent)… 35%

Mrs. G. Okeowo (3rd Respondent)… 5%

Mrs. D.A. Migliore (1st Applicant)… 4.2%

Mr. A. Mangili (2nd Applicant)… 1%

Mrs. C. Mangili (3rd Applicant)… 1%

This computation has not accounted for one hundred per cent of the shares. A further affidavit dated 20th June 1977 was sworn to by Mrs. Migliore. In paragraph 5 of that affidavit she swore that Taiwo’s averments in his paragraphs 9, 10, 11, 12, 13, 14 and 15 of his affidavit were untrue. In respect of her shareholdings in the Company she swore in paragraph 6 of the said further affidavit:

“That paragraph 15 of the said Counter-Affidavit accounts for only 46.25% of the share holding of the Company and has not accounted for 53.75% which belongs to the estate of the late Sergio Migliore and the personal representatives of which are myself and the 2nd Appellant under and by virtue of Letters of Administration granted by the High Court Lagos and the share holding of which are held jointly by me and the 2nd Applicant by virtue of the judgment of this Honourable Court in Suit No. FRC/L/MI9/77 delivered on 18th March 1977.”

Where the evidence has shown that a secretary would not call a meeting;

would not even accept a director’s letter for the call of a meeting; that the majority shareholding of a director was denied; that the secretary had aligned himself with one faction of the disputing directors and that records of the meetings of the Company allegedly held were falsified – surely there could be no clearer evidence of a rift justifying the intervention of court. The alternative to such an intervention would have been to leave the company in a stalemate in which Taiwo Okeowo and E. Olatunde Ayoola, who have the physical control of the company, to continue to conduct the affairs of the company to the detriment of the Mrs. Migliore group who, it must be remembered, and foreigners in our midst.

Chief Williams has stressed that in all the cases cited to us in which the meetings of a Board were held not be be different, in substance, with the meetings of the company, there was unanimity in the decisions of the members and therefore whether they called the meetings that of the Board or that of the Company, the decisions would be the same and unanimous. He stressed that those cases would not be likened to the present one in which the members were in disagreement. The situation, he said, was therefore not analogous.

The provisions of S.128(1) and (2) of the Companies Decree, 1968 are identical with S.135(1) and (2) of the Companies Act 1948 of England and appear to be lifted from that section word for word. The said S.135(1) and (2) of the 1948 Companies Act read:

“(1) If for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called, or to conduct the meeting of the company in manner prescribed by the articles or this Act, the court may, either of its own motion or on the application of any director of the company or of any member of the company who would be entitled to vote at the meeting, order a meeting of the company to be called, held and conducted in such manner as the court thinks fit, and where any such order is made may give such ancillary or consequential directions as it thinks expedient; and it is hereby declared that the directions that may be given under this subsection include a direction that one member of the company present in person or by proxy shall be deemed to constitute a meeting.

(2) Any meeting called, held and conducted in accordance with an order under the foregoing subsection shall for all purposes be deemed to be a meeting of the company duly called, held and conducted.”

The word “Impracticable” came for a consideration in Re EL SOMBRERO LTD. (1958) Ch. 900. The short facts of the case were that the applicant was the holder of nine hundred shares in a private company whose capital was divided into one thousand shares of one pound each. The two respondents, who were at all material times the only directors of the company, each held fifty shares. No general meeting of the company had ever been held and no annual return filed. The applicant by Originating Summons asked the court to make an order, under S.135(1) of the Companies Act, 1948, directing the convening and holding of a meeting, which was opposed by the respondents. The Registrar who heard the summons dismissed the application holding that the court ought not to exercise its discretion by making an order under S.135 in the face of the opposition of the respondents. The applicant appealed against the Ruling to the High Court. Wynn-Parry, J., who heard the appeal observed that the section opened with the words “If for any reason” and held that by reason of those words it was intended that the section should necessarily have a wide scope. He then gave his interpretation to the word “impracticable” in this passage of his judgment at p.904:

“The question then arises, what is the scope of the word “impracticable” It is conceded that the word “impracticable” is not synonymous with the word “impossible”; and it appears to me that the question necessarily raised by the introduction of that word “impracticable” is merely this: examine the circumstances of the particular case and answer the question whether, as a practical matter, the desired meeting of the company can be conducted, there being no doubt, of course, that it can be convened and held. Upon the face of the section there is no express limitation which would operate to give those words “is impracticable” any less meaning than that which I have stated, and I can find no good reason in the arguments which have been addressed to me on behalf of the respondents for qualifying in any way the force of that word “impracticable” or the interpretation which I have placed upon it, and therefore upon that point I am m favour of the applicant. ”

It was argued in that case, as was argued before us by Chief Williams, that the Court could not make the desired order for directions for the calling and the conducting of the meeting of the Company because there was no unanimity among the directors and that the two other directors could prevent a meeting being held. Wynn-Parry, J., rejected the attempt to limit the powers of the Court in these words (ibidem p. 904):

“It was contended that the court could not or ought not to direct a meeting under this section where there was, as there is here, opposition, and, indeed, strong opposition; and in the course of his judgment the registrar said: “So far as I am aware there has never been a case where the court has made an order under section 135 in the face of opposition to such an order. . .” It will be observed that the registrar is careful not to go so far as to say as a conclusion that the court has no jurisdiction to make an order under the section which would even indicate that the jurisdiction can only be invoked if, at least, there is no opposition, and I hold that, on the true construction of the section, there is nothing to prevent the court intervening in a proper case and where the application before it is opposed by other shareholders.”

The Registrar, as the learned judge observed, appeared to have been carried away by the decision in the Scottish case of EDINBURGH WORKMEN’S HOUSE IMPROVEMENT CO. LTD (1935) S.c. 56; (1934) S.L. T. 513 in which the Court refused to make the order sought for the holding of a meeting of a private company in which the majority shareholders/directors sought to hold the meeting in order to remove the minority shareholders/directors because there was “strenuous opposition from the other two” directors. Wynn-Parry, J., after holding the Registrar’s approach to the law as a “misconception” observed at p.906:

“I therefore arrive at the stage where I hold that I have jurisdiction in this case, and there is nothing to prevent me exercising the discretion which is given under the section if I choose to exercise it. It is true that I am sitting as an appellate court, but I an entitled to consider the question of discretion, because, in my view, as I have held, the registrar has misdirected himself on a question of law. In my judgment, this is eminently a case in which the court ought to exercise its discretion; first because if the court were to refuse the application it would be depriving the applicant of a statutory right, which, through the company, he is entitled to exercise under section 184(1), to remove the respondents as directors; secondly (and I think this is a proper matter to take into account as part of the reasons for deciding to exercise my discretion), the evidence disclosed that the respondents are failing to perform their statutory duty to call an annual general meeting. ”

Having thus held that he had jurisdiction and that he ought to exercise the Court’s discretion in favour of the applicant, he concluded:

“For these reasons, therefore, I propose to accede to this application and to direct a meeting of the company to be held under the power given me by section 135 of the Companies Act, 1948.”

I am in respectful agreement with these views expressed by the learned judge. The unanimity principle by which if it can be shown that all the shareholders who have a right to vote at a general meeting of a company assent to some matter which a general meeting of the company can carry into effect, then that assent is as binding as a resolution in general meeting would be (as decided in such cases as REDVOMATIC LTD. (1969) 2 Ch. 365; RE EXPRESS ENGINEERING WORKS LTD. (1920) 1 Ch. 466; RE BAILEY, HAY & CO. LTD. (1971) 1 W.L.R. 1357, all cited by Counsel) does not, in any way, run counter to the power of the Court, under S.126 of the Companies Decree, to exercise its wide discretion granted by that section 1, PARKER AND COOPER, LIMITED V. READING (1926) Ch. 975 referred to by Respondents’ Counsel, in which IN RE EXPRESS ENGINEERING WORKS (supra) and IN RE GEORGE NEWMAN & CO. (1895) 1 Ch. 674 at 684 and 686 were considered, explained and applied, contained a restatement of the unanimity principle, even if the unanimity was got, not at one sitting but at different times, although in the latter the assent is held not to be equivalent to the assent of a meeting though binding on the assenters.At page 686 IN RE GEORGE NEWMAN & CO. (supra) Lindley, L.J., . Delivering the judgment of Court of Appeal (to which Lord Halsbury and Smith, LJ. concurred), observed:

“Individual assents given separately may preclude those who give them from complaining of what they have sanctioned, but for the purpose of binding a company in its corporate capacity individual assents given separately are not equivalent to the assent of a meeting. The company is entitled to the protection afforded by a duly convened meeting, and by a resolution properly considered and carried and duly recorded.”

My Lords, the result of all this is that, in my view, the exercise of the power of the Court to order a calling of a meeting of a company under S.128 of the Companies Decree, 1968 and to give directions for the conduct of the meeting when called, is not limited to where the directors and/or share holders are in unanimous agreement but extends, in its wide scope, to a situation where there is a rift, such as in the instant case, among the directors and strenuous opposition by one faction of the directors against the other. I do not think this view which I hold on the interpretation of S.128 is, or should in any way be affected, by the Supreme Court decision in PAUL IRO V. ROBERT PARK AND 5 OTHERS (supra) which rather supports this power of the court, under S.128, as hereinbefore stated.

It follows, in the premises that I find myself unable to accept the concluding submission of Chief Williams contained at page 4 of his “reply to the case for the respondents” where he stated:

“. . . it is submitted that unanimity is of the essence of the applicability of the rule regarded the rule laid in all the cases and there is none of those decision in which unanimity is lacking. ”

in so far as he intended by that to show, in the instant case, that the Court had no power, under S.128 of the Companies Decree, to make the order it made in the face of the opposition of one faction against the other. The Court, in my view, had undoubted power under that section to make the order it made. In the particular circumstances of this case it had not only the power but also the duty, ex debito justiae, to make the order. To refuse to make the order would have amounted to a denial of the Mrs. Migliore group of the justice to which they were undoubtedly and unequivocally entitled.

In the result I would dismiss this appeal and affirm the judgments of the Courts below.

Having had the opportunity of reading the draft order contained in the judgment of the Presiding Justice, Irikefe, J . S. C. , in respect of Exhibit 003, I hereby express my agreement with the said order.

C. IDIGBE, J.S.C.: The history which brings these proceedings to this court has been fully set out in the judgement of My Lord, Aniagolu J .S.C. which has just been read. For purposes of the judgment I am about to deliver I need only recount in brief those aspects of the facts which will enable me address myself exclusively to the several issues and matters of law which have emerged from the said history. The principal questions for determination in this appeal before us are:

(1) whether the Federal Revenue Court (hereinafter referred to as “the Federal High Court”) has the jurisdiction to make the orders in its judgment delivered on the 27th day of June, 1977; and

(2) whether the orders made by the same court in another judgment of the 25th day of November, 1977 are truly ancillary and consequential upon first judgment of the 27th day of June, 1977

The prayers in the originating summons which commenced these proceedings on 12th April, 1977, in the Federal High Court were for the following orders:

(a) “a declaration that the 4th defendant’s (now the 3rd appellant’s) appointment as secretary to Metal Construction (West Africa) Ltd. (then the 1st defendent and hereinafter referred to simply as “Metal West Africa”) is illegal, null and void and should be set aside;”

(b) for directions “as to the manner in which the Board of the Board of the said company may be summoned, held and conducted for the purposed of considering and if thought fit passing the following resolution:

‘that Mr. E. Olatunde Ayoola … be and is hereby removed as secretary of the company and that Mr. O.O. Ede, Legal Practitioner be and is hereby appointed acting secretary of the company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr. O.O. Ede all the Company’s properties in his possession. ,,,

(c) for “all such ancillary and consequential directions as the court may think fit.”

(Brackets supplied)

The first prayer in the summons having in the course of proceedings been struck out the Federal High Court on the 27th day of June, 1977, ordered in favour of the respondents in terms of the second and third prayers of the summons. It is, in my view, necessary at this stage to recount briefly the salient aspects of the history of these proceedings in order that the reasons for the proceedings which culminated in the second judgment of the 25th November, 1977, may be fully appreciated.

Metal West Africa is a company incorporated in Nigeria and having immediately prior to the events which led to these proceedings, five shareholders, that is (a) Delia Alessandra Migliore (1st respondent), the wife of Sergio Migliore – an Italian who until his death held the largest shares in the company (b) Airaldo Mangili (2nd respondent) and husbnd of (c) Carla mangili (3rd resondent) (d) Taiwo Okeowo (1st appellant) and (e) Grace Okeowo (2nd appellant) the wife of the 1st appellant. The Mangilis and the Migliores are Italians. Prior to the death of Sergio Migliore the shares of the company were held as follows:

1. Sergio Migliore 107,500 shares of N2 each i.e. 53.75%
2. Delia A. Migliore 8,500 shares of N2 each i.e.3 5.00%
3. Taiwo Okeowo 70,000 shares of N2 each i.e. 35.00%
4. Grace Okeowo 10 ,000 shares of N2 each i.e. 4.25%.
5. Airaldo Mangili 2,000 shares of N2 each i.e. 1.00%
6. Carla Mangili 2,000 shares ofN2 each i.e. 1.00%

On the death of Sergio Migliore, letters of administration of his estate were given, by the High Court of Lagos State, to Delia Alessandra Migliore and her brother Airaldo Mangili; and on the 18th day of March, 1977, the Federal High Court (Belgore J.) ordered in a court action prior to the one now in hand that the 107,500 shares of the company held by Sergio Migliore should be registered in favour of (i.e. Delia and Airaldo). The present appellants (also parties in the earlier proceedings) being opposed to, and dissatisfied with, the said order of the 18th day of March, 1977 appealed to the Federal Court of Appeal. It is, in my view, proper to mention in passing that a decision of this court given on the 28th day of September, 1979, in Suit SC.35/79 (See (1979) 6-9 S.C. at page 163) shows that the issues in the wake of the opposition of the appellants to the order of Belgore J. on 18th March, 1977 were litigated ultimately to the Supreme Court.

The position then was that between March and April 1977 there was a quasi-tussle for, and most certainly a violent disagreement on, the ownership of the 107,500 (i.e. nearly 54%) of the shares in Metal West Africa. It is pertinent to mention here that Metal West Africa happens to be one of these few companies in which the rather unique situation of each and every member being at the same time a director of the company exists. As has been recounted in the judgment of My Lord, Aniagolu J .S.c. there was also the anamolous situation and, indeed, one which offends the Companies Decree 1968 (hereinafter referred to simply as “the Companies Decree”) – Sections 154(1) and 395(1) – in which, according to the affidavit of Delia Migliore and in respect of which the secretary himself failed to file a counter-affidavit or depose to the contrary, E. Olatunde Ayoola (the 3rd appellant herein) was the secretary and also the auditor of the company.

It is against the foregoing background that the events which led to these proceedings, and which I propose to mention briefly anon have to be examined. As appears from the entire affidavits before the Federal High Court.

(1) there was a quasi-tussle for, and violent disagreement on, the ownership of 54% of the shares in the company (Metal West Africa); the tussle continued even after a judgment of a court of competent jurisdiction had ruled in favour of the first and second respondents that the shares be transferred them qua administrators of the estate of Sergio Migliore;

(2) the Board of Directors of the Company and, be it noted, also its entire membership had split into two factions, which for convenience I will style the Italian and the Nigerian factions; and

(3) a principal officer of the company, the secretary (the 3rd appellant), had not only identified himself actively, but had also – it was alleged taken sides, with one of the factions (i.e. the Nigerian faction). The secretary – be it noted – did not himself deny this rather serious allegation.

(4) The Italian faction, as would be expected in these circumstances, felt that there was compelling and pressing need by reason also of other allegations of mal-performance of the secretary’s duties both as auditor and secretary of the company to have him removed from the post of secretary.

(5) When, however, the Italian faction led by the first respondent on several occasions orally and in writing requested the secretary to call a meeting of the Board of Directors, he refused to do so. Again, there is no counter-affidavit of the secretary denying these allegations.

(6) On the contrary, it was alleged – and not denied by the secretary – in the affidavit of Delia Migliore that the secretary after the split inthe directorate of the company took instructions from no other member of the company except the first appellant – himself, not only the leader of the Nigerian faction but also (as appears from the affidavit on these proceedings), the foremost and active dissident from the judgment of Belgore J. of the 18th day of March, 1977, which ordered the transfer of 107,500 shares in the company to first and second respondents.

(7) The meetings of the Board and of the Company had always prior to the split in the directorate been convened by the secretary (3rd appellant) at the request of the Board or a member thereof;

(8) the first appellant had proposed “drastically to alter the Articles of Association of the Company in order to secure for himself substantial personal advantage to the detriment of the other directors;” and this he did with the active collaboration of the secretary (the 3rd appellant).

The foregoing, indeed, sum-up the state of affairs in the company when on the 12th April, 1977 the respondents commenced these proceedings.

As the appellants were in July 1977 still contesting the order of the 18th day of March, 1977, made by the Federal High Court for transfer to be first and second respondents of the shares (107,500 in all) of Sergio Migliore, they (the said respondents) felt compelled to come to court by a notice of motion, and ask for directions as to how they may, at the meeting to be convened pursuant to the orders of the Federal High Court made on 27th June, 1977, exercise their several rights of voting. On the 25th day of November 1977, Belgore J. gave the judgment which is the subject of the second appeal in these proceedings; by that judgment, he ordered that:

“the first and second applicants (i.e. 1st and 2nd respondents herein) are to vote at any meeting of the company not only in their own rights as shareholders but in addition as persons entitled to the shares of the deceased Sergio Migliore.”

The appeals of the appellants from the two separate judgements given on (a) The 27th June, 1977, and (b) 25th November, 1977, by Belgore J. were dismissed by the Federal Court of Appeal on the 13th December, 1978. The appeal now in hand is from this order of dismissal by the Federal Court of Appeal.

Learned counsel for the appellants, Chief F.R.A. Williams, submits that the only section of the Companies Decree which empowers the court to order a meeting of the Company is section 128; that section does not empower the court to make an order in terms of the second prayer in the summons, that is, an order for convening a meeting of the Board. The section reads:

“(128)(1): If for any reason it is impracticable to call a meeting of the company in any manner in which meetings of that company may be called, or to conduct the meeting of the company in the manner prescribed by the Articles or this Decree, the court may either of its own motion or on the application of any director of the company or of any member of the company who would be entitled to vote at the meeting, order a meeting of the company to be called, held or conducted in such manner as the court thinks fit, and where any such order is made, may give such ancillary or consequential directions as it thinks expedient”

Arguing the appeal, Chief Williams, further contends that the questions for determination are:

(1) In what circumstances are the powers conferred on the court by the above section (i.e. 128) exercisable

(2) Was the Federal High Court right in its order directing E.O.Ayoola to convene a meeting of the company when the prayer in the summons was for an order convening a meeting of the Board

(3) Was there evidence before the court of the existence of such circumstances as warrant the making of an order under the section”

The respondents, according to Chief Williams, had not shown that it had become “impracticable” (1) either to call a meeting of the company in any manner in which meetings of that company may be called, or (2) if called to conduct the meeting in the manner prescribed by the articles of the company or the Companies Decree. In any case – so he contended – a

meeting of the company can be called (a) on the requsition of members of the company holding not less than 1/1Oth (one-tenth) of the paid-up capital (see section 125 of the Companies Decree) of (b) in accordance with Articles 50 and 89 of the articles of association of Metal West Africa which read:

“(50) The Board may, whenever it thinks fit, conveene an Extraordinary General Meeting, and Extra-ordinary General Meeting shall be convened on such requisition as provided in section 67 of the Companies Ordinance (inpari materia) with section 125 of the Companies Decree.

(89) Any director may at anytime and the secretary shall at the request of any director summon a meeting of the Board. ”

(Underlining and brackets supplied)

The sum of the balance of the contention of Chief Williams on this aspect of his argument is:

(i) there is no evidence of any impracticability to summon a meeting of the company; it was not enough to ask the secretary of the company to call a meeting of the Board. In any case it was open to any of the respondents personally to invite the first and second appellants to a board meeting;

(ii) there is no evidence of impracticability to conduct any meeting of either the Board or the company which had in fact been summoned;

(iii) there is no evidence that any of the respondents atempted to exercise his or her right as shareholder ( or member) under section 125 of the Companies Decree.

Finally, he submits that the summons, as it stands, should be dismissed in the absence of any amendment since the powers of the court did not authorise the calling of meeting of the Board. By its order of the 27th June, 1977 the Federal High Court granted a relief which was never claimed and the Federal Court of Appeal erred in law in upholding the same.

I think it is proper, at this stage, to point out that at the hearing of the application before Be/gore J. on the 20th June, 1977, learned counsel appearing for the Company (Metal West Africa – then the 1st defendant) told the court that:

(i) There was difficulty in convening a meeting of the company;

(ii) “the person suffering as a result of the attitude of the secretary was the company itself”;

(iii) the “Annual General Meeting and other statutory meetings” of the company have not been called and “that was not only bad for the company but illegal”; and finally, on behalf of the company

(iv) he was no opposed to the application; on the contrary he supported the request “that the court directs the calling of a meeting. ”

Having reviewed the history which brings this appeal to this court and having also analysed the evidence before the Federal High Court (hereinafter also referred to simply as “the court below”), I propose now to consider the provisions of section 128 of the Companies Decree. In my view that section provides an alternative remedy to be applied when the normal machinery of management of a company has broken down. I agree with Chief Williams that the first essential condition for the application of the section is that the court must have reason to be satisfied that it has become impracticable to call a meeting of the company or to hold or conduct the meeting in the manner prescribed by the articles of the company or the Companies Decree. The word “impracticable” appearing in the section, however, must be given a practical meaning; the situation envisaged by the section must be understood to be so (i.e. to have arisen) from a business point of view. Accordingly, the conclusion (i.e. on the issue of “impracticability”) ought not to be reached on the slightest excuse that the directs cannot agree. The expression “impracticable” in the con of the section is, indeed, more limited than the word “impossible” (see EL SOMBRERO LTD. (1958) Ch. 900); the term, as I already said, implies impracticability from a reasonabl point of view and the courts must take a commonsense view of the matter.

Now, a thorough, careful but objective examination of the state of affairs existing in Metal West Africa immediately prior to the commencement of these proceedings on 12th April, 1977, show quite clearly that the machinery for management of the company had broken down. Here is a company of only five members (shareholders) – three Italians and two Nigerians – and between them they hold about 46% of the total shares of the company. There was a dispute as to ownership of the remaining 54%; and although, for my part, I can hardly see any reason for, or sense in, the challenge by the Nigerian shareholders to the claim of the Italian shareholders (as adminstrators of the estate of Sergio Migliore) to the 54 % of the shares aforesaid, yet the challenge persists even after a court of competent jurisdiction had found in favour of the claimants. The membership of the company was consequently split into two factions, and so was its directorate. As if the situation was not bad enough the principal officer of the company – the secretary – took sides with one of the factions and refused to take instructions from the opposite faction; so the learned trial Judge found and, in my view, quite rightly too. Such was the state of affairs when the respondents – a faction of the machinery of the management of the company – decided to have the secretary removed.

It seems to me quite obvious that in the circumstances which I have set out above it will not be easy to have a meeting of either the directors or the company convened to take a decision on (1) the question of removal of the secretary, or (2) issues affecting the general management of the company. While drawing our attention to article 89 of the company’s articles, Chief Williams submitted that as there is no evidence that any of the respondents, pursuant to the rights of a director under the said article, personally approached and invited the first and second appellants to any Board meeting (or even unsuccessfully attempted to do so), it was neither open to the respondents to contend as they did, nor open to the court below to find, that a case for the exercise of the powers of the court under section 128 has arisen.

In my view, the short answer to the contention of learned counsel is that, taking a commonsense view of the state of affairs in Metal West Africa during the period under consideration one would expect a prudent business director (i.e. a director of a commercial company) in a like situation to summon a Board meeting through the medium of an appropriate intermediary – in this case, the secretary of the company; and, the existing state of affairs in Metal West Africa at the material period apart, the available evidence shows that meetings of the Board and of the company were always summoned by the secretary. To insist on the need for the respondent to exhaust the provisions of article 89 aforesaid (such as an attempt at personal invitation of the appellants by the respondents to a Board meeting) in the circumstances set out above, as a pre-condition to the exercise of the court’s powers under section 128 aforesaid, in my view, amounts to deliberately placing a gloss on the broken state of the machinery for management of the Company.

As I indicated earlier on, one of the principal questions for determination in this appeal is whether the Federal High Court has jurisdiction to make the orders contained in its judgment of the 27th day of June, 1977. On this aspect of the appeal the contentions on behalf of the appellants are that:

(1) Under section 128 of the Companies Decree the court is not empowered to summon a meeting of the Board; and the prayer in the

originating summons in these proceedings is for a meeting of the Board (not the company) to be called.

(2) Since the originating summons was not amended it was not open to the court to summon a meeting of the company;

(3) Assuming, without conceding the point, that the court could in the circumstances – no amendment of the prayer in the summons having been carried out – order a meeting of the company, it could not properly order that the meeting of the company should proceed to consider a resolution for the removal of the secretary because it is the Board, not the company, that has the powers of appointment and removal of the secretary. (Reference was then made to article 89 of the company’s articles.

It was further contended that since under article 50 of the company’s articles it is the Board that has the powers to summon a meeting of the company, the court ought not, in the present circumstances, to interfere. I will consider anon each of the contentions of the appellants.

With regard to the first two contentions of the appellants in the immediately preceding paragraph, the court below took the view that in the peculiar set-up of Metal West Africa, where each and every member is also a director there was hardly any justification (for the purposes of the necessary orders in respect of the reliefs prayed for in the summons) for the distinction which the appellants seek to make. “The difference, therefore, between the members of the company and members of the Board,” said the learned Judge, the Federal Court of Appeal found support for its stand in the case of Express Engineering Works Ltd. (1920) 1 Ch. 466. The reaction of learned counsel for the appellants to the cae (i.e. Express Engineering (Supra)) is that the principles of law established in the decision in that case:

“Have nothing to do with the problem here (i.e. in these proceedings). In Express Engineering there was no problem as to whether or not it was impracticable to call a meeting of rival factions or the shareholders of the company

It is submitted that the new principle followed in (the case) does not support a readiness on the part of the courts to ignore the difference between company meetings and Board meetings.”

Nothing in the judgment of the court below lends support to the view that, generally, there is no difference between company meetings and Board meetings. I think, however, that it should be annionted out straight away that although the case of Express Engineering (Supra) is authority for three principal separate propositions of law, the decision is cited in these proceedings in support of only one of the propositions, the third, in the order in which I will now set them out. That case (Express Engineering) is authority for the following propositions of law:

(1) If every member is present at a meeting of the company, any resolution passed unanimously thereat which is intra vires the company is valid and binding on the company irrespective of the nature of the notices for the meeting, if any, given, as all the members acting together can waive any formalities as to notice.

(2) A resolution of the proper majority of shareholders in general meeting is the proper mode of declaring the will of the corporation, but if all the individual shareholders, and not a majority only, expressly assent to a transaction, which is intra vires the company, the absence of a resolution takes simultaneously in a general meeting is immaterial (see also, Parker & Cooper Ltd. vs. Reading (1926) Ch. 975 on the same point).

(3) A meeting convened as a meeting of the directors may transact business as a meeting of the company if all the members are present (see also, Palmer’s Company Precedents: Part I General Firms 17th Edition at p.486 note 31.

In Palmer’s Company Law 22nd Ed. 1976 p.561 Para. 51-10, the learned authors recognise the case (Express Engineering) as authority for the statement therein that:

“A meeting convened as a meeting of directors is valid as a meeting of the company, if all the members (i.e. of the company) are present. ”

I take the view which, it seems to me, is the same as that of the Federal Court of Appeal, that support for the converse of the proposition can be found in the statements of Warrington & Younger L.JJ. in that case (Express Engineering) at pages 470 and 471. Accordingly, a meeting convened as a meeting of the company is valid as a meeting of the directors if, as here, each and every member of the company being also a director of the company is present. A decision taken at such a meeting on matters intra vires the company must be valid as a decision of the Board on the subjects.

Next, I propose to examine the third contention of the appellants which is to the effect that since it is the Board that has the power to remove a secretary the directions contained in the ordre of Belgore J. of the 27th day of June, 1977 must be regarded as invalid. Chief Williams, drawing our attention to article 82 of the articles of Metal West Africa, submits that it is the Board of that company, not the company in general meeting, that can remove the third appellant from office. The position here, is that, by virtue of article (1) of Metal West Africa the provisions of article 109 of Table A, in Schedule 1 of the Companies Decree, which specifically reserves in the Board of a company the powers of appointment and removal of a secretary, are inapplicable to Metal West Africa. Article 82 of that company’s articles, however, provide as follows:

“The business of the company shall be managed by the Board who may exercise all such powers of the company as are not by the Ordinance (read Act) required to be exercised by the company in General Meeting, subject nevertheless to the provisions of the Ordinance (read Act) and to such regulations (not being inconsistent with any such provisions) as may be prescribed by ordinary resolutions of the company in General Meeting, but no regulations made by the company in General Meeting, but no regulations made by the company in General Meeting shall invalidate any prior act of the Board which would have been valid if such regulations had not been made. The general powers given by this article shall not be limited or restricted by any special authority or power given to the Board by any other article.”

Undoubtedly, a general provision in the articles of a company such as those in article 82 aforesaid delegates to the directors all such powers of the company as are not required by the Companies Decreed to be exercised by the company in General Meetings; and this, of course, includes powers of appointment and removal of a secretary. I, therefore, agree with Chief Williams that the powers of removal and appointment of the secretary of Metal West Africa lie with the Board of that company. The questions which necessarily follow from this conclusion I have reached are:

(1) Whether, in view of article 82 aforesaid, the company itself can, in no circumstances, exercise the powers of removal or appointment of a secretary

(2) Whether, as Chief Williams further contends, in cases where the directors are unable or unwilling to exercise their powers of removing or appointing a secretary, the company still cannot exercise those powers but can only appoint new or additional directors who may then proceed to exercise the powers of the Board under the said article (i.e. 82 aforesaid)

It is, I think, settled law, at least with regards to filling of vacancies in, or appointing additional members to, the Board of a company that the company itself can exercise powers similar to those vested in the Board by virtue of article 82 under consideration, if the directors are unable to do so or, where, owing to serious differences between them, no meeting of the

Board can be held for the purpose of exercising such powers (see Barron vs. Potter (1914) 1 Ch. 895). In that case (Barron), Warrington J. made the following observations, with which I respectfully agree:

“If directors having certain powers are unable or unwilling to exercise them – are in fact a non-existent body for the purpose – there must be some power in the company to do itself that which under other circumstances would be otherwise done. The directors in the present case being unwilling to appoint additional directors under the powers conferred on them by the articles, in my opinion, the company in general

meeting has power to make the appointment – See (19141 Ch. at 903.)

Buckley on the Companies Act 12th Edition, regards the powers of the company to act in such circumstances as inherent; at p.860 the learned authors of that great work on Company Law observe:

“If the directors are acting mala fide, no doubt there are means of controlling them; and, semble, if there is a comple deadlock on the Board the company in general meeting has an inherent power of appointing additional directors which it can exercise notwithstanding that this power is delegated by the articles to the directors ”

Barron v. Potter (Supra) is also a classic example of a breakdown in the machinery of management of a company as well as a complete deadlock on its Board. There is no doubt, in my mind, that article 82 notwithstanding, Metal West Africa, in view of the state of affairs in the company when these proceedings commenced, can in general meeting exercise its inherent powers of removing the third appellant. I find myself, therefore, unable to accede to the contention on behalf of the appellants that the company can only appoint new or additional directors who then may exercise the powers of the Board under the said article. Why, if one may ask, must a principal appoint another agent in place of an insane agent, or one unwilling any longer to perform his duties qua agent, to transact with a third party the business meant to be dealt with by the insane or unwilling agent instead of himselfpersonally carrying out that transaction After all, agency (and this is almost the position of the Board vis-a-vis the company) is based simply on he principle expressed in the maxim qui per alium facit per seipsum facere vldetur. (He who does an act through another is deemed in law to do it himself.) Surely, it is implicit in the maxim that the principal can always act if the agent will not.

The position in the case in hand is that there exists such a deadlock in the Board of Metal West Africa which has made it “impracticable” for the Board to exercise its powers under either article 82 or 50 of the articles of the company. As I said before, decided cases have shown that the word

“impracticable” in the section is not synonymous with “impossible”. The distinction was considered In EL Sombrero Ltd. (Supra) where the following observations, with which I respectfully agree were made:

“Examine the circumstances of the particular case and answer the question whether, as a practical matter, the desired meeting of the company can be conducted, there being no doubt, of course, that it can be convened and held…”((1958) 3 ALL E.R.(1) at (4)).

(Italics supplied)

It only remains for me to consider the submission of Chief Williams on behalf of the appellants that there being no amendment of the prayer in the summons the learned Judge in the court below erred in ordering the calling of a meeting of the company when the prayer was for the calling of a meeting of the Board. The Court of Appeal, he contended, was accordingly wrong in upholding an order which granted a relief that had not been sought. As is well known, the common rule of pleadings is that a party is bound by his own pleading. The strict application of this rule is capable sometimes of leading to miscarriage of justice hence the courts have been invested with wide powers of amendment of pleadings. And so under general powers of amendment vested in them the courts, for the purpose of determining the real question in controversy between the parties, or of correcting any defect or error in proceedings before them can, at any stage of the said proceedings either of their own motion or on the application of any of the parties thereto, order any document in the proceedings to be amended on such terms as to costs as may appear to them to be just. The court below did not order any amendment of the originating summons to be carried out nor was any application therefor made to it. It does seem however that having analysed the evidence before it that the court decided, in the interest of justice, to determine the real question in controversy as, pursuant to the provisions of section 11 of the Federal Revenue Court Decree No. 13 of 1973, it was within its competence to do. I agree with Chief Williams that not having first carried out an amendment of the prayer in the originating summons it erred in law in proceeding to order as it did. There was, therefore, a manifest defect in the record of the proceedings on appeal before the Federal Court of Appeal. That the court, however, in exercise of its powers under section 16 of the Federal Court of Appeal Decree No. 43 of 1976 can amend such manifest defect and did amend the same. The provisions of section 22 of the Supreme Court Act are to the same effect.

The rule of conduct of the courts in matters relating to amendment of pleadings is that however careless or negligent the first omission to ask for amendment may have been and however late the application therefore, the amendment should be allowed by the court either on its own motion or on the application of a party to the proceedings, if such amendment can be made without injustice to the opposite party (i.e. the other side); and there can be no injustice if the opposite party can be compensated by the award in his favour of the costs occasioned by the amendment. Learned counsel for the appellant contends, and I agree with him that the failure of learned counsel for the respondents to apply in the court below and even in the Court of Appeal for leave to amend the prayer in the summons is in bad taste. As, however, has been said courts” do not exist for the purpose of punishing bad taste”(per Bowen L.J. in Cropper v. Smith (1884) 26 Q.E.D. 700 at 712).

The duty of the courts is to determine the real issues in controversy as they appear on the evidence, although the conduct of the case on behalf of the litigant may have been slipshod or even cavalier. The locus classicus on the issue is to be found in the statement of Bowen L.J. in Cropper v. Smith (Supra) when he observed:

“Now, I think it is a well established principle that the object of courts is to decide the rights of the parties, and not to punish them for the mistakes which they make in the conduct of their cases . . . I know of no kind of error or mistake which, if not fraudulent. . . the court ought not to correct, if it can be done without injustice to the other party. Courts do not exist for the sake of discipline but for the sake of deciding matters in controversy and I do not regard such amendments as a matter of favour or grace . . . It seems to me that as soon as it appears that the way in which a party has framed his case will not lead to a decision of the real matter in controversy, it is as such a matter of right on his part to have it corrected, if it can be done without injustice…”

(Italics supplied-see (1884) 26 Q.E.D. at 710 and 711.)

And as I already said, there is no injustice if the other party can be compensated by the award of costs occasioned by the amendment. Again, on this particular issue (i.e. costs preventing injustice likely to arise as a result of amendments), Bowen L.J. in the same case of Cropper (Supra) said:

“I have found in my experience that there is one panacea which heals every sore in litigation, and that it costs. I have very seldom, if ever, been unfortunate enough to come across an instance where a person has made a mistake in his pleadings which has put the other side to such a disadvantage as that it cannot be cured by the application of that healing medicine”((1884)26Q.B.D. at 711).

Such being the established principles and rules of practice relating to amendment of pleadings I wIll now apply them to the facts in these proceedings. The principal complaint of the appellants on the issue is that the respondents’ prayer is for the court to order a meeting of the Board but the court ordered a meeting of the company, the court being satisfied on the evidence that each and every member of the company is also a director of the company of only five members. It seems to me that the course taken by the Court of Appeal in Clack vs . Wood (1862) 9 Q. B. D. 276 can in the interest of justice be taken here and I would amend the record by altering the prayer in the summons (asking for a meeting of the Board) to accord with the facts proved in the lower court (i.e. to a prayer asking for a meeting of the Company) it being established from the facts in the court below that since it has become impracticable to summon a meeting of the company in the manner prescribed by the articles of the company or by the Companies Decree it has become necessary to order that a meeting of the company be convened in the manner directed by the court below. As it is my view that the appellants – on the facts available on the record – could not have been prejudiced had the amendment been carried out in the court below, I am satisfied that nothing can be gained by an order for a new trial. The appellants contend that if this court should be inclined to amend the record then a new trial should be ordered. I am unable to accede to their request in the light of the evidence on record in these proceedings. On the question of a new trial it is settled law that if the court is in a position, after considering the evidence, to do complete justice between the parties an order for a new trial should not be made. Minturn: (See Barry vs. Minturn (1913) A.C. 594 particularly per Lord parker at p.595). The appellants will however be considered on the costs occasioned by this amendment. Such being the case I am satisfied that the order of the Federal Court of Appeal upholding the judgment of Belgore J. dated the 27th day of June, 1977, in these proceedings must be sustained.

With regard to the appeal from the ancillary directions contained in the order of Belgore J. made on 25th November, 1977 there is no doubt in my mind that if a meeting had to be convened pursuant to the orders in his judgment of the 27th day of June, it was, indeed, absolutely necessary, in the circumstances of the case, that directions should be given as to the manner in which the factions in the membership of the company should exercise their several voting rights. The appeal in respect of this aspect of these proceedings lacks merit. I have had the opportunity of reading in draft the order proposed, with reference to the document admitted as Exhibit 003 in the course of evidence given in the Federal Court of Appeal in FRC/L/M.40/77, in the judgment of my learned brother Mr Lord IRIKEFE J.S.C. and I associate myself with the order.

In the event, I agree with the judgment of my learned brother, Mr Lord, Aniagolu J.S.C. and the orders therein proposed, in respect of the appeal from the judgment of the Federal Court of Appeal upholding the orders of Belgore J. in these proceedings dated 27th June, 1977 and 25th November, 1977. Accordingly, I would dismiss the appeal and it is hereby dismissed with costs as proposed in the order of my learned brother, My Lord, lrikefe J.S.C.

A. O. OBASEKI, J.S.C.: The facts of this case on appeal to this Court were fully set out by my learned brother, the Hon. Justice Aniagolu J.S.C., who read his judgment a short while ago, and save as occasion warrants it in this judgment, a full statement of them will be omitted.

The application by which these proceedings were commenced was filed in the Federal Revenue Court at Lagos. From there the appellants took the matter to the Court of Appeal and from thence to this Court. The application was a simple one. It was brought to Court by originating summons praying the Court inter alia:

(ii) That directions may be given as to the manner in which a meeting of the Board of the said company may be summoned, held and conducted for the purposes of considering and if thought fit passing the following Resolutions:

“That Mr. E. Olatunde Ayoola, Chartered Accountant, be and he is hereby removed as Secretary of the Company and that Mr. O.O. Ede, Legal Practitioner be and is hereby appointed acting Secretary of the Company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr. O. O. Ede an the company’s properties in his possession. ”

(iii) That all such ancillary and consequential directions may be given as the Court thinks fit.”

This application was supported by affidavit evidence (deposed to on the 14th day of April, 1977 by the three respondents) including documentary Exhibits MM1, MM2, MM3, MM4, MM5, MM6, MM7, MM8, MM9 and MM10.

There was an unsuccessful attempt by the appellant to set aside the originating summons on the ground that the claim should have been commenced by a writ of summons. Although the motion was refused, the claim for declaratory judgment in the originating summons was struck out; the ground for so doing being that unlike the applications already set out above, it could not properly be commenced or initiated by originating summons.

Mr. Okeowo, swore to and filed a counter-affidavit on 17th June, 1977 in opposition to the application.

Mrs. Delia A. Migliore on the 20th June, 1977 filed a reply to the counter-affidavit attaching documentary Exhibits MMR1, MMR2, MMR3 and MMR4.

When the application came up for hearing, the 1st respondent through its counsel, Mr. Ogunade, supported the grant of the prayer. In doing so, he said:

“I refer to Exhibits MM3, MM5, and MM7 to show the difficulty in summoning a meeting. The person suffering as a result of the secretary’s attitude is the Company – the 1st respondent. The Annual General Meeting and other statutory meetings are not called which is not only bad for the company but is illegal, I support the application that the Court directs the calling of a meeting. We should not pay costs because we never opposed the application or refused to call a meeting.”

But the 2nd, 3rd and 4th respondents, the first two of whom are now the appellants, opposed the application on the only ground that no section of the company decree empowers the court to give directions on the summoning of a meeting of the Board of Directors of the company. Chief Bayo Kehinde, their counsel, making his submission said:

“The application must fail in law, since section 128 refers to meeting of the company and not to that of the Board of Directors. No other section of the Company’s Decree allows the court to compel a meeting of the Board. Mr. Ayoola is not the Secretary, O.A. Management Services is the Secretary. ”

The reply of Kehinde Sofola, Esq., counsel for the Applicants/Respondents was equally formidable. It reads:

“If it is impossible to call a meeting of the Board of Directors, it will be impossible to call a meeting of the company. The Iwa, i.e. Section 128 of the Companies Decree will be meaningless if a Board meeting cannot be called. A meeting of the Board is a meeting of the Company for practical purposes. All the members of the company are Directors.”

In his opening submissions, Mr. Kehinde Sofola had submitted that the application was brought under section 128 of the Companies Decree 1968. He went on to submit further as follows:

“The summons is supported by an affidavit, particularly paragraph 4 and Exhibits MM1 and MM9 to show that Ayoola is both the Secretary and Auditor of the Company. MM9 shows bill submitted by Mr. Ayoola for his services as Secretary and Auditor of the Company. His dual capacity is contrary to section 154 of the Companies Decree. There is a counter-affidavit filed by the 2nd respondent but there is no substance in it. Paragraph 10 of the supporting affidavit supports our contention that the Secretary had refused to summon a meeting. See Exhibit MM3.”

Belgore, J. who heard the application gave a considered ruling granting the application, the concluding portion of which reads:

“I make the following Orders:

(1) That the 4th respondent, Mr. E.O. Ayoola do, within one week from today convene a meeting of the company consisting of all the members who are:

Mrs. D. A. Migliore

Mr. Taiwo Okeowo

Mr. A. Magili

Mrs. G. Okeowo

Mrs. C. Mangili

(2) That the meeting do consider a resolution about removal of the present Secretary of the company and the appointment of a new temporary or permanent one;

(3) That all the requirements as to length of notice for calling a meeting of the company will not apply to the calling of this meeting;

(4) That Mr. E. Ayoola do hand over to the Secretary if one is appointed all company properties with him as a Secretary. That Mr. E. Ayoola should report back to this Court through affidavit the calling and the result of the deliberation of the meeting so called;

(5) That the affidavit ordered in (4) above should be filed in the

“All the grounds of opposition to the motion are therefore dismissed and the motion is granted. The 1st and 2nd applicants are to vote at any meeting of the company not only on their own right as shareholders but in addition as persons entitled to the shares of the deceased Sergio Migliore.”

Against this decision, the respondents also appealed to the Federal Court of Appeal.

After learned counsel’s argument in the two appeals, the Federal Court of Appeal dismissed both appeals. Delivering the judgment of the Federal Court of Appeal, Ogunkeye, J.C.A. said, inter alia, in the concluding part of the judgment:

“The major bone of contention in this matter is whether it was properly initiated by an originating summons. As we have stated above, this point was taken at the trial when a motion was brought by the appellants asking the court to set aside and/or strike out the summons. That court dealt with the matter exhaustively and we think we can hardly improve upon the conclusion at which the learned judge arrived at.”

After quoting and considering the relevant portion of the judgment of the learned trial judge and the provisions of Order 2 Rule 1 of the High Court of Lagos (Civil Procedure) Rules 1973, section 11 of the High Court of Lagos Act 1955, Order 5 Rule 1 of the Supreme Court Rules of England as stated in Supreme Court Practice, section 12 of the High Court Law (a law for the estblishment of a High Court of Justice for Lagos State), the learned Justice of the Federal Court of Appeal continued:

“These provisions with some minor differences are the same as those quoted in the learned trial judge’s ruling above. It is our view therefore that the matter was properly initiated by an originating summons and on this point we are in agreement with the views of the learned trial judge” ….

After referring to Vol. 10 of Atkins Forms 2nd Edition page 33 paragraph 33 and the schedule following it, the learned Justices of the Federal Court of Appeal proceeded with the judgment as follows:

“The next point to decide is whether it was proper for the learned trial judge to order that a meeting of the company be called instead of that of the board of directors.

Generally a relief which is not asked for should not be granted.”

After quoting the relevant portion of the judgment of the learned trial judge dealing with the point the learned Justices of the Federal Court of Appeal continued:

“Taking the peculiar circumstances of this case into consideration, we think the learned trial judge was right in his conclusion on the point. Here is a case where all the members are at the same time memebrs of the Board. Even if the application was for the calling of a meeting of the board, no harm can be said to be done if the court ordered as it did, that a meeting of the company rather than that of the board be called. The same people are involved in both cases.

Even if technically, this might be described as relief not asked for, we think that in the special circumstances of this case and in view of the powers of the court, suo moto, to order that a meeting of the company be called under section 128 of the Companies Decree 1968, the complaint under this head cannot be sustained. We bear in mind the provisions of section 11 of the Federal Revenue Court Decree 1977 as follows: …

This dispose of the first appeal. In respect of the second appeal, the complaint is that the order made was wider than the relief sought. To start with, the applicants in that motion being members of the company in their own right could not be taken to be asking for an order to allow them to vote at the company’s meetings. The affidavit in support of the application shows that letters of administration of the estate of the deceased director had been granted to them. If the court made an order allowing them to vote not only in their own right but as persons entitled to the shares of the deceased Sergio Migliore, we cannot see any thing wrong in that. For the foregoing reasons, both appeals fail and are dismissed.”

Against this decision, the 1st and 2nd appellants lodged their appeals on the following four grounds:

“(1)(a) The learned judges of the Federal Court of Appeal miscon trued or failed to give effect to the provisions of section 128 of the Companies Decree and thereby came to a wrong decision;

(b) The learned judges of the Federal Court of Appeal erred in law and on the facts in failing to observe that the respondents did not establish that the conditions precedent to the exercise of the powers vested in the Federal Revenue Court pursuant to section 128 of the Companies Decree existed or had arisen in this case.

Particulars of Misdirection and Error Alleged in Grounds 1 (a) and 1 (b)

(i) ….

(ii) …

(iii)…

(2) The Federal Court of Appeal erred in law in holding that “in the special circumstances of this case” the Federal Revenue Court was correct in stating that “the difference between members of the company and members of the Board of Directors is the difference between six and a a half dozen.”

Particulars of Errors

(xxx)

(3) The Federal Court of Appeal erred in law in upholding the orders made by the Federal Revenue Court directing that Mr. Olatunde Ayoola do convene a meeting of company as well as other directions ancillary thereto.

Particulars of Errors

(xxx)

(xxx)

(4) The Court of Appeal erred in law in upholding the further directions of the Federal Revenue Court made on 25th November, 1977 when (for the reasons stated in the grounds of appeal above) the order convening or directing the calling of a meeting of the company was erroreous in law and not suitable.

The parties were ably represented by counsel in this appeal. Chief F.R.A. Williams, S.A.N., argued the appeal on behalf of the appellant while Kehinde Sofola, S.A.N. replied on behalf of the respondents.

Counsel for the appellants wisely, in my view, discontinued the objection to the commencement of the action by originating summons which objection he hitherto consistently pressed or put forward first before the Federal Revenue Court and secondly when the matter went on appeal before the federal Court of Appeal where he pursued the objection with undiminished Vigor.

Similarly, the contention that the Secretary of the company (i.e. Metal Construction (West Africa) Limited) was O.A. Management Services Ltd. and not E.O. Ayoola Esq. was dropped and not pursued as was the case in the Federal Court of Appeal.

The questions formulated by appellants’ counsel in his brief for determination in this appeal are threefold:

(1) In what circumstances or situations are the powers conferred by section 128 of the Companies Decree 1968 to direct a meeting of the

company to be called held or conducted exercisable

(2) Was the Federal Revenue Court right in making the order directing Mr. E.O. Ayoola to convene a meeting of the company when the prayer on the originating summons was for an order that directions may be given as to the manner in which a meeting of the Board of the said company may be summoned

(3) Was there evidence before the Court that such circumstances or situations existed in this case when the orders and directions made by the court pursuant to its powers under the section aforesaid were made

He submitted both in his written brief and in oral argument in court that to bring out the true meaning of section 128 of the Companies Decree and to emphasise the conditions precedent to the exercise of the court’s power, the section may conveniently be rewritten thus:

“If for any reason it is impracticable

(a) to call a meeting of a company in any manner in which meeting of that company may be called or

(b) to conduct the meeting of the company in the manner prescribed by the articles or this DecreeThe court may, either of its own motion or on the application of any director of the company order a meeting of the company to be called, held and conducted in such manner as the court thinks fit…”

He contended that one or the other of the two conditions precedent must be proved to exist before the exercise. The conditions precedent are (1) the impracticability of calling a meeting of the company and or (2) the impracticability of conducting a meeting in the manner prescribed by the articles or the Decree.

Learned Counsel submitted that in view of the provisions of section 125 of the Companies Decree and provisions of the Articles of Association of the company, there can be no impracticability in calling a meeting of the company.

Turning to the question of calling a meeting of the Board he submitted that although the question whether or not it is impracticable to call a meeting of the Board is not strictly relevant to this appeal, it must be pointed out that there was in fact no such impracticability as alleged and pointed out that the provisions of Article 89 gives power to any director to summon a meeting of the Board at any time although the same provision makes it mandatory for the Secretary at the request of any director to summon any meeting.

He contended that the lack of co-operation on the part of the Secretary is of no significance. One may ask then why was it necessary to make it mandatory for the Secretary at the request of any director to summon a meeting If it was not intended that the services of the Secretary be used for such purpose there would have been no need for the provision. It would have been sufficient to leave it at “any director may at any time summon a meeting of the Board” without more.

Learned counsel then submitted that without any amendment to the originating summons, Belgore, J. granted a relief which was never claimed. He contended that neither the Federal Revenue Court nor the Federal Court of Appeal had jurisdiction to make the order directing a meeting of the company to be convened on the claim as it stands when there was no application for or amendment of the summons.

He contended that there was no affidavit evidence of the impracticability of conducting a meeting of the Board. He referred the court once more to section 128 of the Companies Decree and urged the court to hold that as section 128 deals with convening and conducting meeting of the company as distinct from the Board of Directors, the Federal Revenue Court and Federal Court of Appeal were in error in not dismissing the application filed by the respondents.

He attacked the comments of Belgore, J. and of the Federal Court of Appeal in its judgment delivered by Ogunkeye J.C.A. and in its ruling for leave to appeal delivered by Okagbu J.C.A. on the attitude of the Court to small private companies where all the members of the company constitute the Board of Directors.

He disagreed with the use made of the cases Re Express Engineering Works Ltd. (1920) Ch. 466 and in Re Oxted Motor Co. Ltd. (1921) 3 KB 32.

He submitted that where there is unanimity among the shareholders of a small private company its members can be conduct waive the necessity for formalities in summoning a general meeting and referred to Buckley J. dictum in Re Duomatic Ltd. (1969) 2 Ch. 365 at 373 which reads:

“Where it can be shown that all shareholders who have a right to attend and vote at a general meeting of the company assent to some matter which a general meeting of the company could carry into effect that assent is binding as a resolution in a general meeting.”

He also referred to the dictum of Brighman J. in Re Bailey, Hay & Co.Ltd. (1971) 1 WLR 1357 at 1366 G.

Learned counsel further submitted that it was not the function of the General Meeting of the Company to appoint or remove a Secretary but that it was the responsibility of the Board of Directors under an express power in the Articles or under a general power which the Articles normally give them. In such a case, the company, in a general meeting cannot effectively appoint a Secretary unless either the directors surrender their power to the meeting or the appointment is made by special resolution.

He cited “Gower Modern Company Law, 3rd Edition p.143; Volume 1 Palmer’s Company Law 22nd Edition paragraph 64-65 at p. 720.”

On the order made by Belgore J. on the 25th November, 1977 the subject matter of the second appeal, learned counsel for appellants submitted that the prayer granted was outside the motion filed. He contended that the order granted to the respondents was what they did not ask for and cited the case of Nigerian Housing Development Society Ltd. v. Mumuni (1977) 2 SC 57 at p.g 1 where the Supreme Court emphasised that:

“It is elementary that a plaintiff in an action is not entitled to any relief not claimed by him.”

Mr. Kehinde Sofola, learned counsel for the respondents agreed that the application by originating summons for directors to deal with a “motion to remove the Secretary” was brought under section 128 of the Companies Decree 1960. He agreed with the appellants’ counsel’s contention that section 128 deals with power of court to order or give directions in respect of meeting or conduct of the proposed meetings of companies not of Baord of Directors. He however contended that Belgore J. was perfectly justified in view of the facts of the case and the state of the law in ordering a meeting of the company instead of the Board. He submitted that the evidence of the impracticability of summon a meeting of the Board and Company was overwhelming. He referred to the evidence on record as overwhelming and submitted that they clearly demonstrated the impracticability of summoning a meeting of the Board or company and more so the impracticability of conducting a meeting of the Board or company successfully.

He contended that there was no clearer evidence that the manner in which the appellants had conducted the defence in these proceedings. He also emphasised the existence of split in the membership of the company with the Secretary openly aligning himself with the appellants and refusing to take orders from any other director but the appellants. The precondition necessary to the exercise of the powers of the court under section 128 of the companies decree were present. The denial of the rights of the 1st and 2nd respondents vested in them following the death of Sergio Migliore was eloquent testimony.

He submitted that although no amendment to the terms of the application was sought, and obtained, the trial judge had jurisdiction to make the orders made as they enabled the matters to be dealt with more expeditiously.

The main or principal complaint of the appellants in this appeal appears to be what the learned trial judge exceeded his jurisdiction in making the orders he made on the 25th day of November, 1977 and that in any event, he had no jurisdiction to make the order he made on the 27th June, 1977.

Considering the application filed in the Federal Revenue Court on the 7th day of July, 1977 which was:

“for an order giving directions that the 1st and 2nd applicants herein may vote at the company meeting called for Saturday, 11th day of July, 1977 at 11.00 a.m. or at any adjourned or other meeting of the company on such further and/or other orders as this Honourable Court may deem fit to make in the circumstances. ”

And paragraphs 1 to 14 of the affidavit in support particularly paragraph 4 which reads:

“That the 2nd and 4th respondents contend that the persons entitled in consequence of the death of late Sergio Migliore, namely, the 2nd applicant and I, will not be allowed to vote at the meeting of the company”

And the objections of the respondents, I can see no merit in the appeal against the order. Since the fortunes of this appeal are tied up with the appeal against the orders of Belgore J. made on the 27th June, 1977 and affirmed by the Court of Appeal on the 13th day of December, 1978, I now proceed to consider the merit of that appeal.

As already indicated, the main ground of objection is as to the jurisdiction of the Federal Revenue Court.

Counsel for appellants contended that since the applicant respondents/ respondents applied for Directions to be given as to the manner in which a meeting of the Board of Directors of the said company may be summoned and held and conducted for the purpose of considering and if thought fit passing the following resolution:

(1) “That Mr. E. Olatunde Ayoola, chartered accountant be and is hereby removed as Secretary of the company and that Mr. O.O. Ede, Legal Practitioner, be and is hereby appointed acting Secretary of the company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr. O.O. Ede all the company’s properties in his possession; and

(2) That all such ancillary and consequential directions as the court thinks fit.”

the learned trial judge was in error when without any amendment he exercised jurisdiction under section 128 of the Companies Decree 1968 to order

(1) That the 4th respondent, Mr. E.O. Ayoola do within one week convene a meeting of the company consisting of all the members who are Mrs. D.A. Migliore,Mr. Taiwo Okeowo,Mr A. Mangili,Mrs. G. Okeowo

Mrs. C. Mangili

(2) That the meeting do consider a resolution for the removal of the present secretary of the company and the appointment of a new temporary or permanent one.

(3) …

(4) That Mr. E. Olatunde Ayoola do hand over to the Secretary if one is appointed, all company’s properties with him as Secretary. That Mr. E. Olatunde Ayoola should report back to this court through affidavit the calling and the result of the deliberation of the meeting so called.”

I am in full agreement with the statement of law established in the case of Nigerian Housing Development Ltd. and another v. Yaya Mumuni (1977) 2 SC 57 @ 81 which reads:

“It is elementary that a plaintiff in an action is not entitled to any relief not claimed by his.”

What was the relief claimed in this application

It was “directions, to put it simply, that 5 people who hold all the shares in the company and who are all Directors of the company should meet”… and consider a resolution for the removal of the person of Mr. E. Olatunde Ayoola holding the office of Secretary of the company from that office.”

It is true that the originating summons applied for them to meet as directors to consider the removal of Mr. E.O. Ayoola as Secretary of the company, but in arguing the application, applicants’ counsel indicated he was making the application under section 128 of the Companies Decree and complained that as a result of the factionalisation and split in the company’s board of directors, the shareholders have found it impracticable to meet either at Board of Directors’ meeting or General Meeting of the company or summon such meetings to consider the business of the company. The pertinent question is: What are the courts’ powers under section 128 of the Decree The provision of the section provides the answer. Section 128 of the Companies Decree reads:

“(1) If for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called, or to conduct meetings of the company in the manner prescribed by the articles or this Decree, the Court may either of its own motion of or the application of any director of the company or of any member of the company who would be entitled to vote at the meeting, order a meeting of the company to be called, held and conducted in such a manner as the court thinks fit, and where any such order is made may give such or ancillary or consequential directions as it thinks expedient; and it is hereby declared that the directions that may be given under this subsection include a direction that one member of the company present in person or by proxy shall be deemed to constitute a meeting.

(2) Any meeting called, held and conducted in accordance with an order under subsection (1) of this section shall for all purposes be deemed to be a meeting of the company duly called, held and conducted.”

Having regard to the express provision of section 128 of the Companies Decree, it is unrealistic to argue that the learned trial judge made the order without jurisdiction. Similarly, taking the circumstances of the case into consideration and in the interest of justice, a refusal to make the order which the learned trial judge made would have been a gross dereliction of duty and unpardonable. I therefore find myself in respectful agreement with the Justices of the Federal Court of Appeal in their conclusion when they said:

“Taking the peculiar circumstances of this case into consideration, we think the learned trial judge was right in his conclusion on this point. Here is a case where all the members are at the same time members of the Board. Even if the application was for the calling of a meeting of the Board, no harm can be said to be done if the court ordered as it did, that a meeting of the company rather than that of the Board be called. The same people are involved in both.

Even if technically, this might be described as relief not asked for we think that in the special circumstances of this case and in view of the powers of the court suo moto to order that a meeting of the company be called under section 128 of the Companies Decree, the complaint under this head cannot be sustained.”

It is worthy of note that Mr. E. Olatunde Ayoola did not contest the issue of his removal from the office of Secretary.

Learned counsel for the appellants stressed the need for unanimity among the members of the Board of Directors to constitute an informal General Meeting of the company where all the shareholders are also Directors and cited the case of In re Oxted Motor Co. (1921)3 KB32

Parker and Cooper Ltd. v. Reading (1926) 1 Ch. D 975 In re Express Engineering Works Ltd. (1920) Ch. D 466 Re Duomatic Ltd. (1969) 2 Ch. 365 at 373C; and

Re Bailey v Hay & Co. Ltd. (1971) 1 WLR 1357 at 1366 G Mr. Kehinde Sofola, learned counsel for the respondents, while not disputing the authority of the above cases, cited by the learned counsel for the appellants, submitted that since all the parties are before the court, the learned trial judge could, from the circumstances of the case and the facts before it, give directions for a meeting of the company instead of the Board of Directors. He also cited the same cases, viz:

Re Express Engineering Works Limited (1920) 1 Ch. 466470; In re Oxted Motor Company Limited (1921) 3 KB 32 and Parker & Cooper Limited v. Reading (1926) Ch. 975

cited by Chief F.R.A. Williams, S.A.N., learned counsel for the appellants.

The various dicta cited to us from the above cases go to establish the point that the shareholders at a Board of Directors meeting are entitled to waive the formality of notice of an extraordinary general meeting specifying the intention to propose a resolution as an extraordinary resolution and that the resolution that had been passed was just as valid as if there had been the requisite notice. What happened in the case of In re Express Engineering Works Ltd. (1920) 1 CH. 466 was this: all the shareholders of the company – there were only five (as in this instant appeal) – met as directors at a board meeting and afterwards in their capacity of shareholders passed the resolution to issue debentures without any notice having been given for the calling of a general meeting of shareholders as required by section 67 of the Companies (Consolidation) Act 1908. The company was afterwards wound up, and it was contended by the liquidator that as the requirements of the statute had not been complied with, the resolution to issue the denentures was invalid. The Court of Appeal held, affirming Astbury J. that the requirements of the statute were intended for the projection of the share holders and that if the resolution were in a matter intra vires the members of the company, and there was no fraud, the shareholders were able to waive all formalities as regards notice and that the resolution that had been passed was just as valid as if there had been the requisite notice. Lord Sterndale M.R. at page 470 went on

“In the present case these five persons were all the corporators of the company and they did all meet and did all agree that these debentures should be issued. Therefore it seeems that the case came within the meaning of what was said by Lord Davey in Salomon v. Salomon & Co. Ltd. (1987) AC 22.”

After quoting from Lord Davey, Lord Sterndale M.R. went on:

“It is true that a different question there was under discussion but I am of the opinion that this case falls within what Lord Davey said. It was said here that the meeting was a directors’ meeting, but it might well be considered a general meeting of the company, for although it was referred to in the minutes as a board meeting, yet if the five persons present had said ‘we will now constitute this a general meeting’ it would have been within their powers to do so, and it appears to me that that was in fact what they did.”

Warrington L.J. said at p.470:

“It happened that these five directors were the only shareholders of the company and it is admitted that the five, acting together as shareholders could have issued these debentures. As directors, they could not, but as shareholders, acting together they could have made the agreement in question. It was competent to them to waive all formalities as regards notice of meetings, etc. and to resolve themselves into a meeting of shareholders and unanimously pass the resolution in question.”

Younger L.J. at page 471, expressing his concurrence said:

“I agree with the view that when all the shareholders of a company are present at a meeting that becomes a general meeting and there is no necessity for any further formality to be observed to make it so. In my opinion, the true view is that if you have all the shareholders present, then all the requirements in connection with a meeting of the company are observed and every competent resolution passed for which no further formality is required by statute becomes binding on the company.”

In re Express Engineering Works Ltd. was followed by In re Oxted Motor Co. (1921) 3KB 32 where Lush J. said at p.38 after quoting Warrington L.J. (as above)

“If that is true in the case of a resolution to issue debentures it seems to me that it is equally true in the case of a resolution to wind up a company voluntarily such as the resolution in the present case. It is said that in the case of an extraordinary resolution, the legislature has made it imperative that the notice required by section 69 should be given in order to give an opportunity for the shareholders to consider whether the resolution should be passed and that it is not competent to waive that formality. I cannot see any reason why shareholders should not be able to do in that case what they can do in any other case. In the absence of fraud, I think that shareholders can waive notice in this case just as freely as they could In re Express Engineering Works. (2) For these reasons, I think the judgment of the county court judge was wrong and that the appeal must be allowed.”

The facts to that case were that all of the shareholders in the company (there were two of them) met and passed a resolution that the company could not by reason of its liabilities continue its business and that it was advisable to wind it up and accordingly that it be wound up voluntarily. It was contended that section 69 of the Companies (Consolidation) Act 1908 as regards notice of the general meeting specifying the intention to propose the resolution of an extraordinary resolution was not complied with.

In Parker and Cooper Limited v. Reading (1926) Ch. 975), the directors of a company had created a debenture and proceedings were commenced to establish that the debenture and proceedings were commenced to establish that the debenture and the resolution which authorised its issue and the appointment of a certain receiver were invalid, Astbury J. referred to In re Express Engineering Works Ltd. (1920) 1 Ch. 674 and himself expressed this view at p.984:

“Now the view I take of both these decisions is that where the transaction is intra vires and honest and especially if it is for the benefit of the company it cannot be upset if the assent of all the corporators is given at different times or simultaneously.”

If it was competent of the directors who are the only shareholders to waive all formalities as regards notice of general meetings, it is futile to argue that the court cannot give directions for all the directors in this case before us not to meet as board of directors but as shareholders in an extraordinary general meeting of the shareholders, they being the only shareholders of the company.

The court does not require the unanimity of all the members of the board to enable it to give such directions. It is sufficient if the court is satisfied that without its intervention, it is impracticable for the company to meet.

The evidence, which the litigation on this application has provided, is sufficient evidence to support the grant of the application.

The very fact that the victim of the motion to be debated although a party did not contest the facts and the motion but sought refuge in the denial of his being the present secretary and the false assertion that O.A. Management Services Ltd. was the Secretary coupled with the unrelenting oppostion of the 2nd and 3rd respondents/appellants/ appellants to the application, the presentation of false minutes to back up the appointment of O.A. Management Services Ltd. and the denial of voting rights enjoyable by the 1st and 2nd applicants/respondents/respondents, boldly testify to the impracticability of calling a meeting or conducting one to debate the motion.

For the above reasons, these two appeals must fail and I hereby dismiss them with costs to the respondents assessed at N300.00 (three hundred Naira).

With regard to the disclosure before Coker, J.C.A. regarding Exhibit 003, I entirely agree with the Order made by the presiding Justice in the panel which heard this appeal Irikefe, J.S.c. referring the whole proceedings before Coker, J.C.A. together with the said Exhibit 003 to the Attorney-General, Lagos State and the D.P.P., Lagos State, Ministry of Justice for their attention, study and any action they consider necessary in the light of the facts disclosed.

K. ESO, J.S.C.: The only relief pursued by the Respondents to this appeal, who were the applicants in the Federal High Court (but hereinafter referred to in this judgment as the Respondents) is as follows:

(ii) That Directions may be given as to the manner in which a Meeting of the Board of the said Company may be summoned held and conducted for the purpose of considering and if thought fit passing the following Resolution:

“That Mr. E. Olatunde Ayoola Chartered Accountant be and he is hereby removed as Secretary of the Company and that Mr. 0.0. Ede Legal Practitioner be and is hereby appointed Acting Secretary of the Company and that the said Mr. E. Olatunde Ayoola do surrender forthwith to the said Mr. 0.0. Ede all the COmpany’s properties in his possession. ”

The full facts of the case are as contained in the judgment already read by my learned brother, Aniagolu, J.S.C. I will however refer to some of the facts for the purpose of this judgment. The Respondents rely for their application in the Federal Revenue Court, on an affidavit. The following paragraphs are relevant:

“(1) That we are Directors of the Company, Metal Construction (West Africa) Limited.

(2) That the following members are the Directors of the Company:

Mrs. D.A. Migliore – Chairman

Mr. Taiwo Okeowo – Vice-Chairman

Mr. A. Mangili – Managing Director

Mrs. G. Okeowo – Director

Mrs. C. Mangili – Director

(4) That the 4th Respondent who is a Chartered Accountant carries on his accountancy business under the name and style of Olatunde A yoola & Co.

(5) That the said 4th Respondent was appointed the Auditor to the Company on 31st December 1968.

(6) That the said 4th Respondent was also appointed the Secretary to the Company on the same day, namely, 31st December 1968 and (attached herewith and marked “MM1” is a photostat copy of the Minutes of the Meeting of the Company held on 31st December 1968) at which the 4th Respondent was appointed both as Auditor and Secretary to the Company.

(8) That our Solicitor has advised us and we verily believe that it is not legally permissable for the same person to be the Auditor as well as the Secretary to the same Company.

(9) That Article 89 of the said Articles of Association of the Company provides as follows:

“Any Director may at any time and the Sectretary shall at the request of any Director summon a meeting of the Board. Any Director described in the Register by an address not within Nigeria shall be entitled to have notices of meetings of the Board served upon him at that address by telegram or cablegram and also at his address (if any) with Nigeria.”

(10) That several requests both verbally and in writing have been made to the 4th Respondent to summon meetings of Directors of the Company but he has refused to do so. For example, we drove to his office at Ilupeju and requested him to summon a Board meeting for 22nd March 1977 to which he agreed but he did not show up and he did not summon the meeting.

(11) That we sent written requests to him but he instructed his staff to refuse to accept them or to return them

(12) That our Solicitor wrote a letter to him on 19th March 1977 and he wrote a reply dated 21st March 1977 summoning a Board Meeting for 4th April 1977 “to comply with the Court Order made on 18th March 1977″ by His Lordship, the Honourable Mr. Justice M.B. Balgore for the delivery of a Share Certificate to the 1st and 2nd Applicants as Adminstratrix and Administrator of the deceased Shareholder, the late Sergio Miglioeore, following an Originating Summons filed when the 2nd Respondent proposed drastically to alter the Articles of Association of the Company to secure for himself substantial personel advantage to the detriment of the other Directors with the active collaboration of the 4th Respondent…

(13) That our Solicitor wrote to the 4th Respondent a letter dated 22nd march 1977 fully explaining to the 4th Respondent the nature of the Order of Court…

(14) That although the Court removed the interim stay of execution at about 10 a.m. on 4th April 1977 , the 4th Respondent entirely on his own authority purported to cancel the meeting convened for 11 a.m. on 4th April 1977 without the authority of the Boardor the Chairman…

(15) That the 4th Respondent takes dictation only from the 2nd Respondent and from nobody else

(16) That the 4th Respondent has not been acting in the interest of the Company but to feather his own nest . . ..

(18) In the circumstances aforesaid, we verily believe that it is impossible to hold any meeting of the Board as the 4th Defendant will not accept any such request to convene one from us and in consequence it will not be possible for the Company to function without the Order and Directors of this Honourable Court.

(19) That is essential in order to enable the affairs of the Company to be properly managed and for the Company to function effectively or at all that the Order of Court asked for is made.”

The defence of the appellants who were the Respondents in the Federal Revenue Court and who would hereinafter, in this judgement, be referred to as the Appellants, is contained in the counter affidavit deposed to by the 1st Appellant, Taiwo Okeowo – the pertinent paragraphs of which are as follows.

“(2) That I am the Executive Vice-Chairman and Finance Director of the 1st Respondent Company in the said suit.

(5) That with respect to paragraph 2 of the Applicants’ affidavit dated

14th April, 1977, in support of their Originating Summons dated 12th April, 1977, (hereinafter referred to as “the said Affidavit”)

(i) I am not just Vice-Chairman but both Executive Vice-Chairman and Financial Director of the 1st Respondent Company;

and

(ii) it is not correct to say that Mr A. Mangili is the Managing Director of the Company. He is only the General Manager and is responsible to me for his activities in the Company.

(6) That with respect to paragraph 5 of the said affidavit it is not correct to say that the 4th Respondent was appointed the auditor to the Company. It is the firm of Olatunde Ayoola and Company that were appointed auditors to the Company.

(8) That with regard to paragraph 8 of the said affidavit it is not the same person that is the auditor as well as the Secretary to the same Company.

(9) That with regard to paragraphs 10 and 11 of the said affidavit, the 4th Respondent informed me and I verily believe that there has been no time that the Secretaries to the Company have been requested to summon a meeting of the Board of Directors which the Secretaries have not done in accordance with Article 89 of the Articles of Association of the Company as quoted in paragraph 9 of the said affidavit.

(11) That with regard to paragraph 13 and 14 of the said affidavit, the Secretaries rightly cancelled the meeting scheduled for 4th April, 1977 because there was an interim order of this Honourable Court forbidding the holding of such meeting at the time when the meeting was cancelled.

(12) That it is not true that the 4th Respondent takes dictation only from me and from nobody else as alleged in paragraph 15 of the said affidavit as there have been several occasions when other directors of the Company have given instructions to him.

(13) That it is not true “that the 4th respondent has not been acting in the interest of the Company but to feather his own nest” and that the bills attached to the said affidavit and marked “MM9” are for substantial work done for the Company which work had to be done anyway.

(14) That with regard to paragraphs 18 and 19 of the said affidavit, it is not true that is is impossible to hold any meeting of the Board nor is it not possible for the Company to function without the order and directions of this Honourable Court nor is it essential that an order of this Honourable Court be made to enable the affairs of the Company be properly managed because;

(i) provision for calling meetings of the Board already exists in the Articles of Association of the Company;

(ii) operations of the Company have never been impaired anyway even since the taking out of the Originating Summons, the subject-matter of this Counter Affidavit;

(iii) there has been no impossibility in the calling of any meeting of the Board of Directors;

(iv) the Chairman is an absentee Chairman anyway and the Company has been operated efficiently in her absence; She has not stayed more than two weeks in Nigeria before now and the longest period she has ever stayed in Nigeria is the period the matter herein arose;

(v) the 3rd Applicant, Carla mangili, has never attended any meeting of the Board of Directors before since she became a member on the 14th February, 1977 and before then the Company had been running efficiently without her.

(15) That as of the present, the share holding position of the Company is as follows:

Mr. Taiwo Okeowo (2nd Respondent) 35 percent

Mrs. G. Okeowo (3rdRespondent) 5percent

Mrs. D. A. Migliore (1st Applicant) 4.25 percent

Mr. A. Mangili (2nd Applicant) ..1 percent

Mrs. Mangili (3rdApplicant) 1 percent

There was also a reply by the 1st Respondent to this counter affidavit where the 1st Respondent deposed

“(2) That paragraph 3 of the said Counter-Affidavit is untrue; the 2nd Respondent has no authority of the Company to act on its behalf.

(6) That paragraph 15 of the said Counter-Affidavit accounts for only 46,25 percent of the share holding of the Company and has not accounted for 53.75 per cent which belongs to the estate of the late Sergio Migliore and the personal representatives of which are myself and the 2nd Applicant under and by virtue of Letters of Administration granted by the High Court Lagos and the share holding of which are held jointly by me and the 2nd Applicant by virtue of the judgement of this Honourable Court in Suit No. FRC/L/HI9/77 delivered on 18th March 1977.”

The learned judge of the Federal Revenue Court after listening to legal submissions delivered his ruling and held

“It is to be noted that the 4th Respondent against whom all the allegations in the applicants’ affidavit were made did not file any Counter Affidavit denying or affirming the Allegations. It was left for the 2nd respondent

(1st Appellant) to deny some of the allegations for him. Some of the denial were from personal knowledge of the 2nd Respondent but particularly the most fatal one was as a result of what the 4th Respondent told him. Paragraph 9 of the 2nd Respondent’s Counter Affidavit quoted earlier reads

“That with regard to paragraphs 10 and 11 of the said affidavit, the 4th Respondent informed me and I verily believe that there has been no time that the Secretaries to the Company have been requested to summon a meeting of the Board of Directors which the Secretaries have not done in accordance with Article 89 of the Articles of Association of the Company as quoted in paragraph 9 of the said affidavit.”

While hearsay evidence such as the above paragraph is permitted in affidavit’s evidence, it cannot have the same weight in contrast with a direct evidence and in view of paragraph 10 and 11 of the applicants’ affidavit this paragraph 9 is worthless. There is Exhibit “MM3” mentioned in paragraph 11 of the affidavit which reads

“Dear Sir,

” As Mr. Ayoola had been out of town since the morning of Thursday, 24th march 1977 I am returning herewith, a letter which I understood was deposited at the reception of our office.

Mr. Ayoola is expected to be back on Tuesday, and any letter meant for his attention could be delivered there after.

Yours faithfully,

M.K. Mimiko,

Secretary”

“On the evidence before me which I believe, I hold that Mr. E. O. Ayoola the 4th Respondent is the Secretary of the Company. Section 128 reads:

” If for any reason it is impracticable to call a meeting of a Company in manner in which meetings of that Company may be called, or to conduct the meeting of the Company in the manner prescribed by the articles or this Decree the Court may, either of its own motion or on the application of any director of the Company or of any member of the Company who would be entitled to vote at the meeting, order a meeting of the Company to be called, held and conducted in such manner as the Court thinks fit, and where any such order is made may give such ancillary or consequential directions as it thinks expedient; and it is hereby declared that the directions that may be given under this subsection include a direction that one member of the Company present in person or by proxy shall be deemed to constitute a meeting.”

It was the interpretation of this section that the Learned Counsel for 2nd to 4th Respondents based his main objection to the originating summons. He stated that the section only empowered the Court to order meeting of the Company and not that of Board of Directors. On the facts of the present case such argument is academic. In paragraph 2 of the affidavit supporting the originating summons five names are given as those of the Directors of the Company while in paragraph 15 of the Counter-affidavit of the 2nd Respondent the same five names are given as those of the share holders of the Company, the difference therefore between members of the Company and members of the Board of Directors is the difference between six and half a dozen.

Further more the Respondent Company by its Articles of Association have excluded the operation of Table “A” of the first schedule and its Articles Exhibit “MM10” do not make any provision as to who should appoint or remove the Secretary to the Company. I notice in Article 2(i) the Secretary is defined to include “a temporary or assistant Secretary or any person appointed by the Board to perform the duties of Secretary” , if this is taken to mean that the board is the authority to appoint a Secretary in the absence of any such specific provision the Board must have acquired that power as delegated to it by the Company in Article 82. The company has therefore the authority to appoint a Secretary. Having regard to the circumstances of this case as established by the evidence considered earlier in this ruling, I make the following orders:

(1) “That the 4th Respondent Mr. E. C. Ayoola do, within one week from today convey a meeting of the Company consisting of all the members who are:

Mrs D.A. Migliore

Mr. Taiwo Okewo

Mr. A. Mangili

Mrs G. Okewo

Mrs. C. Mangili

(2) That the meeting do consider a resolution about removal of the present Secretary of the Company and the appointment of a new temporary or permanent one.

(3) That all the requirements as to length of notice for calling a meeting of the Company will not apply to the calling of this meeting.

(4) That Mr. E. Ayoola do hand over to the Secretary if one is appointed all Company properties with him as a Secretary. That Mr. E. Ayoola should report back to this Court through affidavit the calling and the result of the deliberation of the meeting so called.

(5) That the affidavit ordered in 4 above should be filed in the Registry of this Court within 14 days from today. this matter is adjourned to 4th day July 1977.”

The Appellants were dissatisfied with this decision and order and appealed to the Federal Court of Appeal. Their Lordships of the Federal Court of Appeal (Ogunkeye, Coker and Okagbue, JJ.C.A.) after hearing legal submissions, in a considered judgement held

“The next point to decide is whether it was proper for the learned trial judge to order that a meeting of the company be called instead of that of the board of directors.

Generally a relief which is not asked for should not he granted. Dealing with this aspect of the case, the learned trial judge after quoting Section 128 of the Companies Decree 1968 went on to say:

“It was the interpretation of this section that the learned Counsel for 2nd to 4th respondents based his main objection to the originating summons. He stated that that section only empowered the Court to order meeting of the Company and not that of Board of Directors. On the facts of the present case such argument is academic. In paragraph 2 of the affidavIt supporting the originating summons five names are given as those of the Directors of the Company while affidavit of the 2nd respondent the same five names are given as those of the share holders of the Company, the difference therefore between members of the Board of Directors is the difference between six and half a dozen.”

Taking the peculiar circumstances of this case into consideration, we think the learned trial judge was right in his conclusion on this point. Here is a case where all the members are at the same time members of the board. Even if the application was for the calling of a meeting of the board no harm can be said to be done if the court ordered as it did, that a meeting of the company rather than that of the board be called. The same people are involved in both cases.

Even if technically, this might be described as relief not asked for we think that in the special circumstances of this case and in view of the powers of the court, suo mostu, to order that a meeting of the company be called under section 128 of the Companies Decree 1988, the complaint under this head cannot be sustained. We bear in mind the provisions of Section 11 of the Federal Revenue Court Decree 1973 as follows:

“The Federal Revenue Court in the exercise of the jurisdiction vested in it by or under this Decree shall in every cause or matter have power to grant, either absolutely or on such terms and conditions as the court thinks just, all such remedies whatsoever as any of the parties thereto may appear to be entitled to in respect of any legal or equivable claim properly brought forward by them in the cause or matter so that, as far as possible all matters in controversy between the parties may be completely and finally determined and all multiplicity of legal proceedings concerning any of those matters avoided.”

(Italics mine)

Chief F.R.A. williams, S.A.N, representing the Appellants in this Court, filed four grounds of appeal against the decision of the Federal Court of Appeal. They are “3 Grounds of Appeal

(a) The learned judges of the Federal Court of Appeal misconstrued or failed to give effect to the provisions of section 128 of the Companies Decree and thereby came to a wrong decision.

(b) The learned judges of the Federal court of Appeal erred in law and on the facts in failing to observe that the Respondents did not establish that the conditions precedent to the execution of the powers vested in the Federal revenue Court pursuant to section 128 of the Companies Decree existed or had arisen in this cause.

Particulars of Misdirection and Error alleged in Grounds 1 (a) and (16b)

(i) The jurisdiction of the court to order the meeting of a company pursuant to powers vested in it under section 128 of the Companies Decree can only arise in two situations: firstly, where for any reason it is impracticable to call a meeting of that company in any manner in which meetings of the company may be called and, secondly, where for any reason it is imeracticable to conduct the meeting of the company in the manner prescnbed by the Articles or the Companies Decree.

(ii) The allegation in the Affidavit in support of the Originating Summons that the 3rd Appellant (Olatunde Ayoola) failed, refused or neglected to summon a meeting if the company at the instance of the Respondents is insufficient to establish any of the situations here before mentioned.

(Ui) The article of Association as well as the Companies Decree contained provisions which made it practicable to call a meeting of the Company.

(2) The Federal Court of Appeal erred in law in holding that “in the special circumstances of this case” the Federal Revenue Court was correct in stating that “the difference… between members of the Company and members of the Board of Directors is the difference between six and half a dozen.”

Particulars of Error

(i) The impracticability of calling a meeting of the company “in any manner in which meetings of that company may be called” or of conducting the meeting of the company “in the manner prescribed by the articles or by the Decree are essential when considering whether or not the court ought to exercise its powers uner section 128 of the Companies Decree 1968.

(ii) The manner in which meetings of the Board of the company here in question may be called or conducted is not the same as the manner in which meetings of the company may be called or conducted. Accordingly the existence of impracticability as aforesaid in the case of calling or conducting a Board meeting would be irrelevant to the question of the existance of similar impracticability in calling or conducting a meeting of the company.

(iii) In this case such evidence as there was, was in respect of alleged difficulties in the calling of a meeting of the Company,

(3) The federal Court of Appeal erred in law in upholding the orders made by the Federal Revenue court directing that Mr. E. Olatunde Ayocola do convene a meeting of the Company as well as other directions ancillary thereto.

Particulars of Error

(i) There was no Prayer in the Originating Summons for the court to convince or direct the calling of a meeting of the company.

(ii) The authority of a court to direct or order a meeting of the company of its own motion is not exercisable where an application is made to the court to exercise its powers under section 128 of the Decree and such application fails or is found to be misconceived.

(4) The authority of a court to direct or order a meeting of the company of its own motion is not exercisable where an application is made to the court to exercise its powers under section 128 of the decree and such application fails or is found to be misconceived.

(4) The Federal Court of Appeal erred in law in upholding the further directions of the Federal Revenue Court made on 25th November 1977 when (for the reasons stated in the Grounds of Appeal above) the order convening or directing the calling of a meeting of the Company was erroneous in law and not sustainable.”

In a very comprehensive brief, learned counsel stated the question for determination as follows

“(a) In what circumstances or situations are the powers conferred on the court by Sec. 128 of the Companies Decree 1968 to direct a meeting of a company to be called, held or conducted exersisable

(b) Was the Federal Revenue Court right in making the order directing Mr. E. C. Ayoola to convene a meeting of the Company when the prayer on the Originating Summons was for an Order that directions may be given as to the manner in which a Meeting of the Board of the said Company may be summoned

(c) Was there evidence before the court that such circumstances or situations existed in this when the orders and directors made by the court pursuant to its powers under the Section aforesaid were made”

Learned counsel prayed in his brief for the appeal to be allowed, the decisions of the Federal High Court and the Federal Court of Appeal set aside and the claim of the Respondents on the Originating summons dated 12th day of April 1977 in respect of the relief on that Summons and also the Respondents motion dated 4th July 1977 dismissed for reasons which he stated in the brief as follows

“(1) Because both the Federal Court of Appeal and the Federal Revenue Court failed to preserve that the conditions precedent to the exercise of power conferred on the court by Sec. 128 of the Companies Decree were not proved to exist before the court of first instance proceeded on exercise such power.

(2) Because both courts aforesaid overlooked the fact that the court had no jurisdiction to grant the prayer sought by the Appellant.

(3) Because there was no application in the court below or before the Federal Court of Appeal to amend the claim on the Originating Summons.

(4) Because no notice was served on the Appellants that the Respondents will or intend to contend that the decision of the Federal revenue Court should be varied or that it should be affirmed on grounds other than those relied on by that court.

(5) Because both of the courts below erroneously considered that where there is no unanimity amont the shareholders of a small private company the difference between a meeting of the Board of Directors on the one hand and a General meeting of the Company on the other is immaterial in the con of the powers conferred on the Federal Revenue Court by the companies Decree 1968.

(6) Because the further directions of the Federal Revenue Court made on the 25th November 1977 ought to be set aside for the reasons stated in 1-5 above.”

Mr. Kehinde Sofola, S.A.N., filed a brief for the 1st, 2nd and 3rd respondents. the substance of his contention is that it is conceded that s.128 of the Companies Decree 1968 deals with the meetings of the Company and not of the Board and what the Respondents in fact asked for was a meeting of the Board to consider a resolution for the removal of the Secretary, the removal of the Secretary was under normal circumstances a function for the Board. By virtue of sections 10, 11 and 12 of the Federal Revenue Court Decree 1973, since the Directors were the only members of the Company the decision of the Federal Revenue Court is justified. Counsel also contended that it was the duty of the court to do substantial justice. Counsel further argued in the brief that the appointment of the Secretary was made by the Company in which case the Company would have the power to determine the appointment. The Board of Directors was split and the evidence was to the effect that Mr. Ayoola carried out Okeowo’s instruction. He would, learned counsel continued, not convene any meeting of the company as he had failed to do in the case of the meeting of the Board. As regards the order that Mrs. Migliore and Mr. Mangill be allowed to vote, learned counsel’s brief was to the effect that the essence was that the two people should vote in the right of the 107,500 which belonged to the late Mr. Migliore. Learned counsel concluded that the Federal Revenue Court and the Federal Court of Appeal were both right as substantial justice has been done.

Chief Williams replied to this case of the Respondents by stating firstly that inadmissible evidence or material was used in the respondents’ brief and secondly that the brief failed to discuss the vital issue that is, the jurisdiction of the court to make the order which it made or purported to make under s.128 of the Companies Decree.

As regards substantial justice, learned counsel’s brief was to the effect that whilst a court of law is bound to do substantial justice, it can only do so upon the evidence fairly placed before it. In this case,

Chief Williams said there was not such evidence.

In his oral submissions to this court, Chief Williams emphasised that the crux of the case is the interpretation of s.128 of the Companies Decree and drew attention to the preconditions for the exercise of the power under that section. If s.128 of the Companies Decree does not embrace meetings of the Board counsel submitted that no impractability has been shown for conducting a meeting. But if even s.128 includes meetings of the Board, then in the submission of Chief Williams, it is not enough for the exercise of the powers under that section to say the Secretary will not co-operate.

For his part, Mr. Kehinde Sofola in his oral submission said that the fact that there was a serious split in the Company was sufficient evidence of impracticability. Both learned counsel however relied heavily on the briefs which they filed and which I have already referred to in this judgement.

It is true that in the Originating Summons what the respondents asked for were “directions as to the manner in which a meeting of the Board of the Company may be summoned, held and conducted.” It was when on 23rd June 1977 Mr. Kehinde Sofola made submissions on this originating summons, which, in fact made no reference to any section of the Companies Decree, that he indicated to the court that his application was made under S.128 of the Companies Decree and the learned counsel representing the Appellants (Mr. Bayo Kehinde) joined issue with Mr. Sofola on s.128 of the Decree.

I have earlier stated the issues which the Appellants consider are for determination in this appeal. The first issue deals with the circumstances or situations in which the power conferred upon the court by s.128 of the Companies Decree could be exercisable. Section 128 of the Decree, no doubt, deals with the power of the Court to order meetings when “for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called.” Mr Sofola has rightly conceded that he made a mistake by relying upon this section in seeking an order for directions as to the calling of a meeting of the Board but submits that the Court did substantial justice in the circumstances of this case having regard to the fact that the Directors are the only members of the Company.

In stating the facts of tilis case in his judgement, my brother Aniagolu J.J . C. , has stated clearly the too factions in the company.

I have no doubt in my mind, and in regard to this I agree with Chief Williams, that what the Respondents sought in the originating summons was for direction as regards summoning and conducting a meeting of the Board of Directors. It is also patent that they meant this and not a meeting of the company if one looks closely at their affidavit. They referred to themselves as Directors of the Company though they are also the members, see paragraph 1 and 2 of their affidavit which I have earlier set out in this judgement. In paragraph 9 they referred to Article 89 of the Articles of Association which deals with summoning of a meeting of the Board by a Director. Paragraph 10 states clearly that their several requests to the Secretary both verbally and in writing had been in regard to summoning meetings of Directors of the Company. See also paragraphs 11, 12 and 18.

It is also clear that this was the case the Appellants joined issue with the learned trial judge no doubt, ought to have made an order for the summoning of a meeting of the Board of Directors and not of the Company.

However, in my view, the real question is whether any harm had been done and whether the learned justices of the Federal Court of Appeal error came to the right conclusion when they said, and I quote them again

“Taking the peculiar circumstances of this case into consideration, we think the learned trial judge was right in his conclusion on this point . No harm can be said to be done if the court ordered as it did, that a meeting of the Company rather than that of the board he called. The same people are involved in both cases.”

To my mind, this is the crux of this appeal. It is the duty of the court to do substantial justice. Chief Williams in his brief admitted this. His only contention was that there was no evidence to support the order made by Belgore J.

So, let us examine the facts and the peculiarity of this case.

From the evidence, the Secretary, Mr. Ayoola of this private company had become partisan to the Okeowo faction of the company. he has not denied any of the allegations against him with regard to his frustrating, in his capacity as Secretary of the Company, the calling of a meeting of the Board of Directors. A letter written to his office was returned. The allegation “that several requests both verbally and writing having been made to the 1st Respondent to summon – meeting of the Directors of the Company but he has refused to do so.”

was not denied by him. The Directors are the only members of the company. there is not a single outsider . Yet that Mr. A yoola was partisan to the Okeowo group who held only 40 per cent of the shareholding as against the Italian group who held 60 percent of the shares is beyond question.

Again, the main reason for the calling of a meeting was as to the removal of this partisan secretary who it was feared, as stated in paragraph 12 of the affidavit of the Respondents, already copied out in this judgement, might collaborate with Talwo Okeowo the principal character against the Italian group to alter the Articles of Association of the Company drastically to secure for the said Taiwo Okeowo substantial personal advantage to the detriment of the Respondents. Mr. Ayoola never denied this very serious and damaging allegation, though he was made party to the action. A meeting called for 4th April 1977 , was postponed by Mr. Ayoola acting on the instruction of Mr. T. Okeowo, leader of the Nigerian minority group.

The split in the company, once the veil of this private corporation is lifted, is seen to be carried even to instruction of counsel for the Company itself after the originating summons had been taken out. While

Mr Okeowo in an affidavit dated 15th April, said he was the largest shareholder and by virtue of this he had instructed Chief F. R. A. Williams to represent the company, Mrs migliore, in a counter-affidavit dated 31st May, 1977 swore she had the largest number of shares and that the expatriate block representing 60 per cent of the equity of the company never gave such instructions. Indeed, the truth is that 53.75 percent of the shares belonged to the estate of the late Bergio mangili were personal representatives. And it was the future of this 53.75 per cent that has caused a feud in the company. It turned out that the Company through its counsel, did not oppose the application on the Originating Summons.

On the issue of representation by counsel of the company itself, it is interesting to note what went on in court. After the affidavit and counter affidavits aforesaid and on 1st June, 1977 the following appeared in the record

“Kehinde Sofola for the Applicants

Chief Williams for the respondents (that is including the Company)

Ogunade appears for respondent company

Court I want the issue of representation first

Chief Williams For the purpose of my motion dated 15th day of March 1977 (that is (April) the motion asking that the originating summons be struck out) I am not representing the Company.”

And after this, Chief Williams never appeared for the Company. On the 23rd June 1977 the learned counsel for the Company supported the application in the originating summons. He said:

“The person suffering as a result of the Secretary’s attitude is the Company… The Annual General meetings and other Statutory Meetings are not called which is not only bad for the company but illegal. I support the application that the Court directs the calling of a meeting …”

In my view once the Appellants failed to take up the challenge of the issue of representation of the company, the fact that the majority shareholders briefed counsel for the company did not diminish from the strength of the representation. And so we have a situation whereby the Company itself will be the person that suffers. Throughout this appeal no one has challenged this fact. It is the duty of the Directors of a Company to exercise powers vested in them for the benefit of the company their fiduciary relationship is not for individual advantage but for the company – see Automatic Self Clearing Co. v. Cunningham (1906) 2 Ch. 34.

The court must do substantial justice. I ask myself what substantial harm is done to anyone by the Court ordering a meeting of the company instead of that of the Directors especially when all the members are the Directors and the Company is not opposed to the action taken I can see no harm. Each case, as Lord Watson said in Bray v. Ford 1896 A. C. 44 at p.50 must depend upon its own circumstances, and having regard to the peculiar circumstances of this case I have no hesitation in agreeing fully with the statement of the Federal Court of Appeal when they said:

“Even if technically this might be described as relief not asked for we think that in the special circumstances of this case and in view of the powers of the court, suo motu, to order that a meeting of the company be called under s.120 of the Companies Decree 1968, the complaint under this case cannot be sustained.”

I therefore agree that this appeal should be dismissed with costs as already specified in the judgement of my brother lrikefe, J. S. C.

One last, but important matter, and that is in regard to the remarks of Coker J .C.A. in the proceedings before him. I have had the advantage of reading the order contained in the judgment of my brother Irikefe J.S.C. in regard to the proceedings FRC/L/M.40/77 before Coker, J .C.A. and I associate myself fully with the order which my aforesaid learned brother has made in the circumstances.

---

Other Citation: (1979) LCN/2138(SC)