MANAGEMENT ENTERPRISES LTD & ANOR V JOHNATHAN OTUSANYA
July 21, 2025IBIYEMI ODUYE V NIGERIA AIRWAYS LIMITED
July 21, 2025Legalpedia Citation: (1987) Legalpedia (SC) 11142
In the Supreme Court of Nigeria
Fri Apr 10, 1987
Suit Number: SC. 74/1984
CORAM
MOHAMMED BELLO, JUSTICE, SUPREME COURT
ANTHONY NNAEMEZIE ANIAGOLU, JUSTICE, SUPREME COURT
DAHUNSI OLUGBEMI COKER, JUSTICE, SUPREME COURT
ADOLPHUS GODWIN KARIBI-WHYTE, JUSTICE, SUPREME COURT
CHUKWUDIFU AKUNNE OPUTA, JUSTICE, SUPREME COURT
SAJDU KAWU, JUSTICE, SUPREME COURT
PARTIES
M.A. OMISADE AND 3 ORS
APPELLANTS
HARRY AKANDE
RESPONDENTS
AREA(S) OF LAW
JURISDICTION-COMPANY LAW-AGENCY
SUMMARY OF FACTS
The respondents sued the appellants for some declaratory and injunctive reliefs and damages in respect of company matters. The court found for the respondents. An appeal at the court of appeal was dismissed, hence this present appeal.
HELD
Allowing the appeal
ISSUES
Whether, having regard to the fact that the suit primarily involved a dispute between the directors of a company in connection with the affairs of their company, the matter was within the exclusive jurisdiction of the former Federal Revenue Court and the High Court of Lagos State had no jurisdiction to adjudicate on it.
RATIONES DECIDENDI
LOCUS STANDI FOR WRONG DONE TO A COMPANY
In order to redress a wrong done to the company or to recover moneys or damages alleged to be due to the company, the action should prima facie be brought by the company itself. Per Bello CJN
MINORITY SHAREHOLDERS ACTION OR DERIVATIVE ACTION
A minority shareholders action or derivative action is a procedural device by means of which on the principle of equity a relief, such as restitution of unjust enrichment by its director, is sought on behalf of a company. Per Bello CJN
DUTY OF COURT IN RESPECT OF INTERNAL MANAGEMENT OF COMPANIES
The Court will not interfere with the internal management of companies acting within their powers, and in fact has no jurisdiction to do so. Per Bello CJN
VOTING POWER OF THE DIRECTORS OF A COMPANY
The voting power of the directors of a company at a board meeting or of its majority shareholders at a general meeting is the very foundation of the minority shareholders action. Per Bello CJN
CASES CITED
Buckley On The Companies Acts, Vol. 1, 13th Ed. P. 199
Burland v. Earle (1902) A. C. 83 at 93
Foss v. Harbottle
Mozley v. Alston
Phipps v. Boardman (1965) 1 Ch. 992;
Regal (Hastings) Ltd. v. Gulliver (1967) 2 A. C. 134;
Nasr. v. Berini Bank (1968) 1 All N.L.R. 274
Wallersteiner v. Moir (1975) 2 W.L.R. 389.
Pinney v. Hunt, 6 Ch. 98
The Recepta (1893) P. 235
Spokes v. The Grosvenor Hotel (1897) 2 Q. B. 124 at 128
Wailersteiner v. Moir (No. 2) 2 W.L.R. 389 at 395
Edwards v. Hall/well (1950) 2 All E.R. 1064 at 1067A
Skenconsult Ltd. and Another v. Ukey (1981) 1 S.C. 6
STATUTES REFERRED TO
Supreme Court of Judicature Act, 1925
Federal Revenue Court Act 1973
Companies Act
Constitution of the Federal Republic of Nigeria 1979
Supreme Court Act, 1960
