Effect of Failure to Include Questions for Determination in an Originating Summons Facts

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On 14th August, 2009, the 4th Respondent, acting as the Governor of Central Bank of Nigeria, issued an order removing all the Executive Directors of the 6th Respondent bank, and appointed the 5th Respondent and other persons in their place. By the same order, the sum of N120 billion was injected into the bank on the basis that it was weak, under-capitalised and/or insolvent, and therefore, an unreliable and unsafe financial institution. The 4th Respondent published his actions and accusations against the 6th Respondent bank in print and electronic media, both nationally and internationally, and threatened to turn over the 6th Respondent bank to the 2nd Respondent, the Nigeria Deposit Insurance Corporation (NDIC), or sell it alongside other affected banks outrightly to foreign investors.

As a result of the crisis in the 6th Respondent bank, and on the instigation of the 4th Respondent, the former Directors were handed over to the Economic and Financial Crimes Commission (EFCC) for investigation, and possible recovery of depositors’ lost funds. The EFCC, which was the 7th Respondent on the Originating Summons but was struck off the appeal at the Court of Appeal for non-appearance, did not restrict its arrest and interrogations to the concerned parties; it also went after the customers of the 6th Respondent bank, arresting and detaining them, and thus, coercing many of them to repay loans granted to them by the bank. However, the monies recovered by the EFCC were never paid over to the 6th Respondent bank, which the 4th Respondent continued to denounce as being insolvent.

Subsequently, the Appellants, who are minority shareholders of the 6th Respondent bank and who did not believe that the actions of the 4th Respondent was bona fide, filed an Originating Summons at the Federal High Court, Lagos, by which they sought leave to bring a Derivative Action on behalf of the 6th Respondent bank, and also challenged the actions of the 4th Respondent. In the Originating Summons, the Appellants did not raise any question for determination, but sought the nullification of the appointment of the 4th Respondent as the Governor of the Central Bank of Nigeria, and his actions with respect to the 6th Respondent bank. They also sought other declaratory and injunctive Orders against the Respondents, as well as damages.

In response to the Originating Summons, the Respondents each filed a Memorandum of Conditional Appearance and Notices of Preliminary Objection, challenging the competence of the suit and the jurisdiction of the Federal High Court to hear and determine the Appellants’ action. The Preliminary Objection was heard and in its ruling delivered on 16th June, 2010, the trial court upheld the Preliminary Objection and struck out the suit on the ground that the Originating Summons did not contain questions for determination. Dissatisfied, the Appellants appealed to the Court of Appeal which upheld the ruling of the trial court and dismissed the appeal. Still dissatisfied, the Appellants filed an appeal at the Supreme Court.

Issue
The Appellants formulated a sole issue for determination in their joint brief, while the Respondents also formulated their individual sole issues. The Supreme Court adopted the issue formulated by the Appellants in its determination of the appeal thus:

Whether the Court of Appeal was right in its conclusion that the Originating Summons of the Appellants was incompetent, and must be struck out for not containing questions for determination.

Arguments
Counsel for the Appellants argued that the Court of Appeal erred in law, when it dismissed the Appellants’ appeal on the ground that their Originating Summons did not contain questions for determination. Counsel cited Order 9 Rule 1 of the Federal High Court (Civil Procedure) Rules, 2009 and Rule 2(2) of the Companies Proceedings Rules, 2001 in support of the form of the Originating Summons with which the Appellants commenced the action. He referred to the format of the Originating Summons in Form 2 as provided in Rule 2(2) of the Companies Proceedings Rules and contended that, the form does not require that the Originating Summons should have questions for determination particularly when the action is a Derivative Action brought under Section 303 of the Companies and Allied Matters Act (CAMA). He cited the case of AGIP (NIG.) LTD v AJIP PETROLI INTERNATIONAL (2015) 5 NWLR (Pt. 1187) 348, in support of his position.

In reply, counsel for the 1st Respondent as well as counsel for other Respondents submitted similarly that, the principal claims of the Appellants as contained in their Originating Summons were not based on the operation of CAMA as posited by counsel for the Appellants; hence, the form of the Appellants’ Originating Summons was inappropriate. Dr. K.U.K. Ekwueme, lead counsel for the 4th to 6th Respondent, distinguished the case of AGIP (NIG.) LTD v AJIP PETROLI INTERNATIONAL (SUPRA) cited by the Appellants and the instant case, and contended that the facts are not the same. He submitted that, the Court of Appeal was right to have upheld the ruling of the trial court upholding the Respondents’ Preliminary Objection which was premised on the provision of Rule 21 of the Companies Proceedings Rules, which limits the applicability of the Companies Proceedings Rules to actions founded on any provision of any section of Part A of CAMA.
Counsel submitted further that, the matter at the lower court was decided on the basis of Order 3 Rules 6 and 7 of the Federal High Court (Civil Procedure) Rules, 2009 which provide that an Originating Summons which a person relies upon to establish entitlement to a legal and equitable right, must contain issues for determination.

Court’s Judgement and Rationale
In its decision, the Supreme Court considered the submissions of counsel for the parties and came to the conclusion that although Order 3 Rule 7 of the Federal High Court (Civil Procedure) Rules, 2009 provides for the raising of questions in an Originating Summons before reliefs are claimed; however, the provision is not absolute. By Order 3 Rule 9(1), a Plaintiff is allowed to take out an Originating Summons in any of the forms 3, 4 or 5 provided in the rules, with such variations as circumstances may require. Hence, if the provision in Order 3 Rule 7 was absolute, the provision in the Rule 9(1) would have been unnecessary. The Apex Court held that the authority in FAMFA OIL LTD v ATTORNEY GENERAL OF THE FEDERATION & ANOR (2003) 18 NWLR (Pt. 852) 453 and other authorities cited by the Court of Appeal in support of its decision were decided under the Federal High Court (Civil Procedure) Rules, 2000, which mandated the formulation of questions for determination in an Originating Summons.

The Federal High Court (Civil Procedure) Rules, 2009, does not contain the mandatory provision for formulation of questions for determination. Order 3 Rule 9(1) of the 2009 Rules has given liberty to a Plaintiff who is desirous of commencing an action by Originating Summons, to choose between Form 3 and Form 4, depending on the circumstances of his case. If he chooses Form 4, he does not need to raise questions, before setting out the reliefs which he seeks. Relying on its decision in INAKOJU v ADELEKE (2007) 4 NWLR (Pt. 1025) 427 at 574, the Court held that where there are sufficient provisions in the rules of court to sustain an action, the rules of natural justice demand that parties should be heard, with a view to resolving their dispute once and for all. It is in the interest of justice that parties are not shut out prematurely from being heard, in accordance with the laid down procedures in the court’s Rules.

The Supreme Court concluded that, the trial court was wrong in striking out the Appellants’ suit, which was filed when the Federal High Court Rules, 2009 had come into effect, and the Court of Appeal was wrong to have upheld the decision of the trial court. The appeal was thus, allowed, and the case remitted to the Chief Judge of the Federal High Court to be assigned to another trial Judge for trial.

Appeal Allowed.

Representation
Mr. Chuks Nwachukwu for the Appellants.

Mr. Olanrewaju Osinaike with Chima Okereke and Rapheal Ipinyomi for the 1st Respondent.

Mr. Hamid Ogunbiyi for the 2nd Respondent.

Mr. Adekunke N. Aribisola for the 3rd Respondent.
Dr. K.U.K. Ekwueme with Abdulkadir Mustapha and Babatunde Ige for the 4th to 6th Respondent.

Reported by Optimum Publishers Limited, Publishers of the Nigerian Monthly Law Report (NMLR)

Quotes
“ORDER 3 RULE 9(1) OF THE 2009 RULES HAS GIVEN LIBERTY TO A PLAINTIFF WHO IS DESIROUS OF COMMENCING AN ACTION BY ORIGINATING SUMMONS, TO CHOOSE BETWEEN FORM 3 AND FORM 4…..IF HE CHOOSES FORM 4, HE DOES NOT NEED TO RAISE QUESTIONS, BEFORE SETTING OUT THE RELIEFS WHICH HE SEEKS”