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N.A.B Kotoye V. Mrs. F.M. Saraki & Anor. (1994) – SC

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➥ CASE SUMMARY OF:
N.A.B Kotoye V. Mrs. F.M. Saraki & Anor. (1994) – SC

by Branham-Paul C. Chima

➥ COURT:
Supreme Court – S.C. 147/1993
(1994) 7 NWLR (Pt.357) 414

➥ JUDGEMENT DELIVERED ON:
Friday, The 29th Day Of July 1994

➥ AREA(S) OF LAW
Trust.
Registered share holder.

➥ PRINCIPLES OF LAW
⦿ STATUTES ARE TO BE GIVEN THE ORDINARY MEANING
It is a settled cardinal principle of statutory interpretation that where, in their ordinary meaning the provisions are clear and unambiguous effect should be given to them without resorting to external aid. The duty of the court is to interpret the words of the statute as used. Those words may be ambiguous, but even if they are the power and duty of the court to travel outside them on a voyage of discovery are strictly limited (see for example Attorney-General of Bendel State v. Attorney-General of ‘the Federation (1981) 10S.C. 1; Abioyev.Yakubu(1991)5 NWLR (Pt. 190) 130, Lawal v. G.B. Ollivant (1972) 2 S.C. 124, Aya v. Henshaw (1972) 5 S.C. 87. — I.L. Kutigi, JSC.

⦿ DATE OF COMMENCEMENT: IF STATUTE IS TO HAVE AN EARLIER APPLICATION, IT IS TO BE STATED EXPLICITLY
The date of commencement of the Decree, as stated in the marginal note in it, was 20th June, 1991. The date of commencement of a statute is the date that it comes into operation. In the circumstance, the date on which the Decree itself, which included section 11 thereof, came into operation was the 20th June, 1991. There was nothing in the Decree to the effect that the Decree or any part or section thereof shall be deemed to have come into operation on a date earlier than the date of commencement stated in the Decree. Also, there was no provision in the Decree that actions or proceedings on matters to which the provision of section 11 of the Decree applied, which were pending in courts on the date of commencement of the decree, should abate or be discontinued. If it is intended by the lawmaker that any part or section of a statute should come into operation on a date earlier than the date of commencement of the statute itself provision to that effect will be made in clear term. — Y.O. Adio.

➥ LEAD JUDGEMENT DELIVERED BY:
Idris Legbo Kutigi, J.S.C.

➥ APPEARANCES
⦿ FOR THE APPELLANT
Chief Williams, S.A.N.

⦿ FOR THE RESPONDENT
Chief G.O.K. Ajayi S.A.N.

➥ CASE FACT/HISTORY
The Plaintiff’s claim thus:
A declaration that the 2,400,000 shares and the Bonus, Scripts and other shares attached thereto standing in the name of the defendant in the Register of Shareholders of Societe Generale Bank (Nigeria) Limited is held by him in trust for the plaintiffs (or alternatively) for the 2nd plaintiff;
(2) An order directing an Inquiry into the amount of any dividends which may have been received by the defendant as holder of the afore-mentioned shares up to the date of the judgment herein;
(3) An order of injunction restraining the defendant from holding or dealing with the aforesaid shares otherwise than as trustee for the plaintiff and in accordance with the lawful direction of the plaintiff or the appropriate authorities. (4)  An order for rectification of the Registrar of Shares to give effect to any judgment delivered herein.”

While the hearing was in progress, the defendant, by a Motion on Notice dated 16th March 1992 applied to the trial court for an order: Striking out the consolidated suits herein on the ground that this Honourable court has no jurisdiction to continue to entertain same and or allow the proceedings to be maintained against the defendant/ applicant.”
The application was opposed. After hearing arguments from both parties. The learned trial Judge, Olusoja Thomas J. dismissed the motion. The Appellant/Defendant appealed, which also said appeal was dismissed.

Available:  Chief F.S. Yesufu v. Kupper International N.V. (1996) - SC

The Supreme Court is called upon to answer whether the claims of the plaintiffs are caught by the provision of section 11 of Decree 25 of 1991 which is reproduced here again: “11.  Notwithstanding anything contained in any law or in any contract or instrument, no suit or other proceeding shall be maintained against any person registered as the holder of a share in a bank on the ground that the title to the said shares vests in any person other than the registered holder. Provided that nothing in this section shall bar a suit or other proceedings on behalf of a minor or person suffering from any mental illness on the ground that the registered holder holds the share on behalf of the minor or person suffering from the mental illness.”

➥ ISSUE(S) & RESOLUTION(S)
[APPEAL DISMISSED]

I. Whether the claims of the plaintiffs are caught by the provision of section 11 of Decree 25 of 1991, hence the Court has no Jurisdiction?

RULING: IN RESPONDENT’S FAVOUR.
A. THAT THE DEFENDANT IS THE REGISTERED HOLDER OF THE SHARE & NOT CHALLENGED; THE COURT HAS JURISDICTION
“So that unless the plaintiffs specifically claim that title in the shares vests in them or in any person other than the defendant registered holder, it would be difficult to bring them under section 11 of the Decree. It is common ground as stated in para.4 of the affidavit in support of the motion above, that the shares in dispute are registered in the name of the defendant in the books of Societe Generale Bank Ltd as holder thereof. The consolidated suits in no way sought to challenge or deny that the defendant is the registered holder of the shares in question or that the shares are vested in him. I think therefore that Chief Williams S.A.N. was right when he said that the plaintiffs are not challenging the fact that the defendant is the registered owner of the shares, but that the defendant is a trustee of those shares for the plaintiff as the beneficial owners. That in my view is the plain and ordinary meaning of the plaintiffs claims in this case. I appreciate that there might be problems in respect of the claim for rectification depending on what turns out to be rectified after the trial. Definitely it could not be the rectification of the name of the defendant as a registered holder of the shares which section 11 (ibid) forbids, but it could even be the number of shares or any other error as may be revealed during the trial. But once the defendant is declared a trustee of any of the shares for the plaintiffs, the question of rectifying the Register of Shareholders to reflect their names would no more arise because defendant cannot be a trustee unless he holds the shares in his name to enable him exercise control over them. There is no doubt at all that section 11 (ibid) sought to oust the jurisdiction of the court to entertain matters in respect of registered shareholders in banks. Therefore being an ouster clause, the provision will have to be construed strictly and very strictly too (see Barclays Bank v. C.B.N. (1976) 1 All NLR 409. Ouster clauses must not be construed liberally, or loosely or wantonly. And that is what I have endeavoured to do in this case. We must not forget that a constructive trust, as in this case, is imposed by equity on the ground of conscience and it is not based on the prior or presumed intention of the parties. I would like to believe that the A parties herein are conscionable people. A constructive trust is a trust to be made out of the circumstances.”

Available:  Chijioke Ugwu v. The State (2020)

“I think that if as a result of the plaintiffs’ claims, the defendant is successfully pronounced to be a trustee of any of the shares thereof, he the defendant will still remain the registered legal owner of the shares while the plaintiffs will become the beneficial owners only, a trust relationship being equitable generally. It is of no consequence whatsoever that the defendant though a registered holder is a mere notional or nominal owner of the shares while the plaintiffs are the real beneficial owners. That is exactly what the law of trust is all about. It is not the function of any court to change the law and Decree 25 of 1991 has not changed it. It is none of the business of the court to read into the section 11 other meanings simply because the court does not like the natural and direct result of its application which does not lead to any absurdity.”
.
.
.
✓ DECISION:
“In conclusion this appeal fails and it is hereby dismissed. I hold that the two lower courts, the trial High Court and the Court of Appeal, were right when they respectively came to the conclusion that the High Court has the jurisdiction to continue with the consolidated suits herein. The plaintiffs are awarded costs assessed at one thousand (N1,000) naira against the defendant.”

➥ MISCELLANEOUS POINTS
***DISSENTING
**Michael Ekundayo Ogundare J.S.C:
A. THAT THE DEFENDANT TITLE TO THE SHARES IS CHALLENGED, HENCE THE COURT HAS NO JURISDICTION
“What these averments amount to is that the 2,240,000.00 shares in dispute in that suit belonged in fact to the 2nd Plaintiff who provided the money for their purchase but that the defendant fraudulently converted the said shares to himself and got himself registered as the owner of the said shares. This to my mind is a clear challenge to the defendant’s ownership of the said shares.”

“An examination of the claims and their pleadings will show clearly that what they set out to achieve is exactly what is covered by Section 11. Whether the defendant is a trustee-de-son-tort (or constructive trustee as such a person is usually called), or trustee or agent of the 2nd plaintiff in respect of the shares in dispute, – see paragraph 12 of the amended Statement of Claim, the substance of the plaintiffs’ case is to the effect that the defendant, although a registered holder ‘is merely a notional or nominal owner of the shares while the 2nd plaintiff is the true owner. It therefore, cannot be said that the Plaintiffs are not disputing the title of the defendant, the registered holder of the shares in dispute, to the said shares on the ground that the shares truly belong to the 2nd plaintiff. Claim (1) Seeks a declaration which, if granted will hold out the plaintiffs or alternatively the 2nd plaintiff as the true owner of the shares as against the defendant who is a registered holder of the said shares. The view I hold is more reinforced, in my respectful view, by claims 2,3 & 4 which seek to vest the benefits and control of these shares in the Plaintiffs or alternatively the 2nd Plaintiff, thus making the defendant a mere notional owner and the 2nd plaintiff the substantive owner.”

Available:  B.V. Magnusson v. K. Koiki & Ors. (1993) - SC

➥ REFERENCED (STATUTE)
Section 11 of Decree 25 of 1991 which is reproduced here again: “11. Notwithstanding anything contained in any law or in any contract or instrument, no suit or other proceeding shall be maintained against any person registered as the holder of a share in a bank on the ground that the title to the said shares vests in any person other than the registered holder. Provided that nothing in this section shall bar a suit or other proceedings on behalf of a minor or person suffering from any mental illness on the ground that the registered holder holds the share on behalf of the minor or person suffering from the mental illness.”

➥ REFERENCED (CASE)
⦿ A RETROSPECTIVE OPERATION IS NOT TO BE GIVEN TO A STATUTE UNLESS EXPRESSLY INTENDED
✓ In Re Athlumney (1898) 2 Q.B. 547, Wright J opined thus:-“Perhaps no rule of construction is more firmly established than this, that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards a matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment; If the enactment is expressed in a language that is fairly capable of either interpretation, it ought to be construed as prospective only.”

✓ In Colonial Sugar Refining Co. v. Irving (1905) A.C. 369, the Australian Commonwealth Judiciary Act, 1903 which had abolished a right of appeal by the Privy Council from the Supreme Court of Queensland, it was held not to apply retrospectively to a suit pending when the Act was passed and decided by the Supreme Court after that date.

➥ REFERENCED (OTHERS)
⦿ STATUTES WHICH ENCROACH ON PRIVATE RIGHTS SHOULD BE INTERPRETED STRICTLY
✓ In Maxwell on Interpretation of Statutes 12th Edition 251-252 the learned author writes:- “Statutes which encroach on the rights of the subject, whether as regards person or property, are subject to a strict construction in the same way as Penal Acts. It is a recognised rule that they should be, interpreted if possible, so as to respect such rights, and if there is any ambiguity the construction which is in favour of the freedom of individual should be adopted. One aspect of this approach to legislation is the presumption that a statute does not retrospectively abrogate vested rights, another is the presumption that proprietary rights are not taken away without provision being made for compensation.”

✓ Halsbury’s Laws of England 4th Edition paragraph 906, page 557 where the learned authors say: Unless it is clearly and unambiguously intended to do so a statute should not be construed so as to interfere with or prejudice established private rights under contracts or the title to property or so as to deprive a man of his property without his having an opportunity of being heard; in particular, an intention to take away property without giving a legal right to compensation for the loss of it is not to be imputed to the legislature unless that intention is expressed in unequivocal terms. See also section 40( 1)(a) and (b) of the 1979 Constitution.

End

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