By Jude-Ken Ojinnaka
A Federal High Court sitting in Lagos has ordered three Nigeria based Indian businessmen to pay the sum of N98.2 million and US$325,000.00 to an 87 year-old Nigerian businessman, Isaac Oluwole Oginni for unlawfully and wrongfully removing him as a Director of three firms which he established.
The order to pay the aforesaid sum was made by Justice Faji while delivering judgement in the Suit Numbered FHC/L/CS/1431/2019, in which Isaac Oluwole Oginni filed challenging his purported removal as director by his business partners in the companies he founded.
The three Indian businessmen/partners affected by the court order are: Mr. Jai Bhagwan Gupta, and his two sons, Vineet Gupta and Rachit Gupta.
Delivering judgement, Justice Faji held that no reasons were adduced by the defendants for the removal of the plaintiff which showed a breach of the right to fair hearing.
The judge also held that the illegal act of the three Indians is a breach of the right to fair hearing and the clear provisions of Section 262 of Companies and Allied Matters Act (CAMA),
The judge noted that the crux of the issues is whether or not the provisions of the law as regards notice for extra-ordinary general meetings have been fulfilled.
Dwelling on relevant sections of CAMA 1990, Justice Faji held that “Section 262 of the law stated that reasons must be given in the notice requesting a Director’s removal, before a director can be removed.
The court therefore restrained the first to sixth defendants either by themselves, or their agents, privies, officers from any act that may curtail or impede the rights of the Plaintiff as a member and director of the first, second and third defendants.
Dwelling on the defendants contention that the fourth defendant holds 40,000.00 fully paid up shares in the first defendant, as at 1987, the court stated that “in exhibit 1009, it was clear that the company’s share capital is now 100, 000,000.00 ordinary shares of N1.00 each.
“The fourth defendant holds 38, 000, 000. 00 of those shares which are not even paid for. The defendants did not controvert exhibit 1009 and same is deemed admitted. I must therefore hold that the defendants do not have 10 percent of the paid up capital of the companies.
“Even plaintiff’s exhibit 1009 showed that the fifth defendant has 15,000,000.00 of 100, 000, 000 but the shares were not paid for.
“The fourth defendant had 38 million shares as at 1st February, 2023 does not show that as at the date of the extra-ordinary general meeting in 2019 that he had the requisite shareholding. What is more, no reasons were given for the removal of the plaintiff and that to my mind shows a breach of the right to fair hearing and the clear provisions of Section 262 of CAMA.
“I must therefore resolve issues 1 and 2 in favour of the plaintiff and hold that the first relief, that is the plaintiff is a director and remains a director of the first to third defendants has merit and is granted as prayed.
“It is obvious that the plaintiff is entitled to the following sums after prorating and deducting the figure relating to NIBCO Ltd and the plaintiff’s deceased wife to wit: Directors’ payments of N13.9 million, Vacation benefit of N12 million, Annual bonus of $150,000.00 and N55, 500, 000. 00.
“I therefore grant the plaintiff the sum of N81,000, 000.00 and US$150,000.00. This sum covers the benefits up to 17th August 2017, when Exhibit 1003 was made. The vacation allowance was N1, 000, 000.00 per year. The period from 2017 to date is 7 years. An additional sum of N7, 000, 000.00 is thus due to the Plaintiff as vacation allowance.
“The yearly bonus is US$25,000.00 per year making a total of US$25,000 for 7 years to US$175, 000.00, Directors payment of N1, 400, 000.00 for 7 years is N9, 800, 000. 00. Up to date therefore, the plaintiff is entitled to the sums of N98, 200, 000.00 and US$325,000.00,” the court held.
Justice Faji, however, refused the plaintiff’s request for an order directing the first, second, third and fourth defendants to pay him the sum of N500 million, being his benefits, commissions and brokerages from the activities of the first to third defendants.
The court refused plaintiff’s relief 11, stating that it would amount to double compensation, having granted reliefs 2 and 4.
Consequently, Justice Faji declared that the octogenarian remains a director of his three companies, Bolawole Enterprises Nigeria Limited, Lesag Nigeria Limited and Intermanagement Nigeria Limited.
The octogenarian Isaac Oluwole Oginni had in his statement of claims, filed and argued by his counsel Yakubu Galadima, sought for the following reliefs: “A declaration that he was a director and remains a director of the three companies listed as first, second and third defendants in the suit.
“A declaration that he being a first subscriber and director in the first to third defendants, is entitled to certain benefits, advantages and reliefs from the activities of the three companies.
“An order compelling the fourth defendant to render a comprehensive account of the Plaintiff of the N7, 000, 000, 000.00 (Seven Billion Naira) Export Everything Grant (E.E.G) granted to the first defendant by the federal government.
“An order directing the Corporate Affairs Commission, (seventh defendant) to investigate the affairs of the first, second and third defendants.”
But in their counter affidavit, the first to sixth defendants through their counsel, Festus Afeiyodion, filed a 45 paragraph counter-affidavit with exhibits and written address. They urged the court to dismiss the plaintiff’s originating summons for lacking in merit.
The seventh defendant, Corporate Affairs Commission (CAC) did not file any counter, and it was not represented by any lawyer for three years that the suit lasted.
