A Federal High Court sitting in Lagos, has ordered three India nationals to pay the sum of N98.2 million and additional $325,000 to an 87-year-old businessman, Isaac Oginni for breach of fair hearing and the clear provisions of section 262 of Companies and Allied Matters Act, CAMA.
Trial judge, Justice Ayokunle Faji also held that the octogenarian remains a director of his three companies, Bolawole Enterprises Nigeria Limited, Lesag Nigeria Limited and Intermanagement Nigeria Limited.
The Indians affected by the court order in a suit marked FHC/L/CS/1431/2019, are: Mr. Jai Gupta, and his two sons, Vineet Gupta and Rachit Gupta.
The octogenarian had in the suit by his counsel, Yakubu Galadima, sought for 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.
He also sought for a declaration that the he being a first subscriber and director in the first to third defendants, was entitled to certain benefits, advantages and reliefs from the activities of the three companies.
He also prayed the court for an order compelling the 4th defendant to render a comprehensive account to the Plaintiff of the N7billion granted to the 1st defendant by the Export Expansion Grant Scheme.
But the first to sixth defendants through their lawyer, Festus Afeiyodion, in a counter-affidavit, urged court to dismiss the suit 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.
READ ALSO: Edo gov: Ignore Apapa’s letter to INEC, LP tells Nigerians
Delivering judgment, Justice Faji held that no reasons were given by the defendants for the removal of the plaintiff, which showed that a breach of the s to fair hearing and the clear provisions of section 262 of CAMA.
The judge noted that the crux of the issues being whether or not the provisions of the law as regards notice for extra-ordinary general meetings have been fulfilled.
Highlighting relevant sections of CAMA 1990, the 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.”
Consequently, the court 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.
On the defendants contention that the fourth defendant holds 40,000 fully paid up shares in the 1st defendant, as at 1987, the court stated that in exhibit 1009, it was clear that the company’s share capital is now 100million ordinary shares of N1each.
The court held “The fourth defendant holds 38,000,000 of those shares which are not even paid for.
“The defendants have not controverted exhibit 10009 and same is deemed admitted. I must, therefore, hold that the defendants do not have 10 per cent of the paid up capital of the companies.”
The court held that even plaintiff’s exhibit 1009 showed that the 5th defendant has 15million of 100million but the shares were not paid for.
READ ALSO: Attacks on BDC will worsen exchange rate situation -Peter Obi
“The 4th defendant had 38million shares as at February 1, 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 1st to 3rd defendant 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 Plaintiffs deceased wife to wit: Directors’ payments of N13.9 million,Vacation benefit of N12 million, Annual bonus of $150,000.00 and N55.5million.
“I, therefore, grant the plaintiff the sum of N81million and $150,000. This sum covers the benefits up to August 17, 2017, when Exhibit 1003 was made.
“The vacation allowance was N1million per year. The period from 2017 to date is seven years. An additional sum of N7million is thus due to the plaintiff as vacation allowance.
“The yearly bonus is $25,000 per year making a total of $25,000 for seven years $175,000,
“Directors payment of N1.4million for seven years is N9.8million. Up to date therefore, the plaintiff is entitled to the sums of N98.2million and $325,000,” the court held.
In his reactions after the judgment, the plaintiff lawyer, Yakubu Galadima described the verdict as sound and unassailable.
READ ALSO: NUPENG, EFCC, join forces against oil theft
He said “The Judgment was a sound and unassailable and also to say victory at last! It was a lesson learned.
“That is, our client Chief Oginni set up an indigenous company called Bolawole Enterprises Nigeria Limited in the 80s and brought a friend of his that is the 4th Respondent who was sacked from another organization to manage the company.
“As time goes by, the 4th Respondent brought his children into the company as directors, altered the initial shares and ultimately trying to remove our client and his late wife as directors. That was when we approached the court.
“The 7th Respondent had been directed by the order of court to audit the affairs of the companies in question. After their interrogations, appropriate sanctions will be imposed.
“As I stated elsewhere, it is a big lesson for the indigenous companies to trade with caution whenever they are dealing with foreign partners so as not to take over their companies. Our clients passed through a lot of pains while dealing with these aliens called business partners,” he added.
