The Federal High Court, sitting in Lagos has ordered immediate freezing of all Bastanchury Power Solutions Accounts in all commercial Banks in Nigeria.
The court also ordered compulsory Annual General Meeting (AGM) of Bastanchury Power Solutions Nigeria Limited, in compliance with the Provisions of the Company and Allied Matters Act, 2020 (As Amended) within days of the judgment.
The court presided over by Justice Kehinde Ogundare ordered that the AGM must be held within 14 days, from the date the Order of Court is made.
Apart from compelling the company to make the compulsory AGM and audit the first and second defendants’ accounts, Justice Ogundare also made an order compelling the Deputy Chief Registrar (DCR) of the court to appoint an external and independent auditor to audit the company’s accounting books and the operations of it’s funds manager, African Plus Partners Nigeria Limited, Defendants on the Defendant has unilaterally misappropriated and utilized the funds of the 1st Defendant, towards its funds to wit: Africa Infra Plus Fund (AIPF) to the exclusion of the 1st Plaintiff who is a substantial Shareholder in the 1st Defendant and the 2nd & 3rd Plaintiffs who remain Directors of the 1st Defendant as at the time of filing this suit.
The judge further made an order of Injunction restraining the defendants, their agents, privies, representatives or the like from unilaterally dealing with the assets, shares, funds or any of the first defendant’s assets, shares, funds or chose in action; in any manner whatsoever with all commercial Banks including the following to wit: Guaranty Trust Bank Plc, Access Bank Plc, Citi Bank Nigeria Limited, Ecobank Nigeria Plc, Fidelity Bank Plc, First Bank of Nigeria Limited, First City Monument Bank Plc, Globus Bank, Heritage Bank Limited, Jaiz Bank, Keystone Bank Limited, Polaris Bank Limited, Providus Bank, Stanbic Ibtc Bank Nigeria Limited, Standard Chartered Bank, Sterling Bank Plc, Suntrust Bank Limited, Union Bank Of Nigeria Plc, United Bank For Africa Plc, Unity Bank Plc, Wema Bank Plc and Zenith Bank Plc, on any accounts whatsoever maintained by the Bastanchury Power Solutions Nigeria Limited, with the said commercial banks until the final audit report on the accounting books and operations of the company is presented to the Deputy Chief Registrar of this Honourable Court.
“An order of Injunction restraining the defendants from selling, charging, mortgaging or otherwise encumbering in any way any of the assets, shares, funds or any of the Bastanchury Power Solutions Nigeria Limited’s assets, on behalf of the Bastanchury Power Solutions Nigeria Limited Company, all the assets which includes landed properties belonging to the Company, until the final audit report of the accounting books and operations of the Bastanchury Power Solutions Nigeria Limited is submitted to the Deputy Chief Registrar of this Honourable Court.
“An order of this Honourable Court compelling the 3rd and 4th defendants to disclose before this Honourable Court all the funds belonging to the 1st and 2nd Defendants in their custody and/or funds pertaining to the 1 st and 2nd Defendants for the purpose of determining the funds due to the Plaintiffs in this suit.”
The above orders were made by Justice Ogundare on July 22, 2024, while delivering judgment in a suit marked FHC/L/CS/319/2023, filed by the plaintiffs; Fenchurch Energy Nigeria Limited, Mr. Funsho Adeyemi and Mr. Femi Bakare through their lawyer, Adedoyin Adetunji-Adeniyi of AAA Chambers, against against the power solution firm, Bastanchury Power Solutions Nigeria Limited, FBNQUEST Trustees Limited and Stanbic-Ibtc Trustees Limited, a Trustees of Africa Infra Plus Funds, listed as first to third defendants
The plaintiffs have approached the court by an originating Summons pursuant to Rule 2 (1) of the Companies Proceedings Rules and Sections 344 of the Companies and Allied Matters Act, 2020 (as amended), and asked the court for the determination of the following questions: “whether the second defendant, who did not register its shareholdings with the Corporate Affairs Commission but hijacked the Board of the first defendant, can unilaterally manage the affairs of the first defendant’s Company and make incidental and crucial decisions without due regards to provisions of the Company and Allied Matters Act, 2020?
“Whether the Honourable Court is imbued with jurisdictional powers to intervene and oversee the Management of the 1st defendant Company where the 2nd defendant has excluded the Plaintiffs, who are shareholders and Directors in the management of the 1st Defendant?
“Whether the Honourable Court can compel the 1st and 2nd defendants to jointly appoint forensic auditors, to probe, audit and give a detailed report of the financial activities of the 1st and 2nd Defendants and prepare audited annual financial report?
“Whether the Honourable Court can compel the 3rd and 4th defendants to disclose before this Honourable Court all the 1st and 2nd defendants’ funds in their custody and/or funds pertaining to the 1st and 2nd defendants for the purpose of determining the funds due to the plaintiffs in this suit?
“Whether the Honourable Court can Order the Plaintiffs to convene its Annual General Meeting in line with the Provision of the Company and Allied Matters Act, 2020 {As Amended}”
The Plaintiffs stated that upon the determination of the above in its favour, asked the court for the following orders: “an order of the Honourable Court ordering a compulsory Annual General Meeting and Board Meeting to be held by the members and Directors of the 1st Defendant Company; Bastanchury Power Solutions Nigeria Limited in compliance with the Provisions of the Company and Allied Matters Act, 2020 {As Amended} not more than 7 days from the date the Order of Court is made.
“An order of the Honourable Court appointing external and independent auditor to audit the accounting books and operations of the 1st and 2nd defendants on the ground that the 2nd Defendant has unilaterally misappropriated and utilized the funds of the 1st Defendant, towards its funds to wit; Africa Infra Plus Fund {AIPF} to the exclusion of the 1st Plaintiff, who is a substantial Shareholder in the 1st defendant and the 2nd and 3rd Plaintiffs who remain Directors of the 1st defendant as at the time of filing this suit.
“An order of perpetual Injunction restraining the defendants, their agents, privies, representatives or the like from unilaterally dealing with the assets, shares, funds or any of the 1st Defendant’s assets, shares, funds or chose in action; in any manner whatsoever with all commercial Banks including the following to wit: Guaranty Trust Bank Plc, Access Bank Plc, Citi Bank Nigeria Limited, Ecobank Nigeria Plc, Fidelity Bank Plc, First Bank of Nigeria Limited,
First City Monument Bank Plc, Globus Bank, Heritage Bank Limited, Jaiz Bank, Keystone Bank Limited, Polaris Bank Limited, Providus Bank, Stanbic Ibtc Bank Nigeria Limited, Standard Chartered Bank, Sterling Bank Plc, Suntrust Bank Limited, Union Bank of Nigeria Plc United Bank For Africa Plc, Unity Bank Plc, Wema Bank Plc and Zenith Bank Plc, on any accounts whatsoever maintained by the 1st Defendant with the said commercial banks until the final audit report on the accounting books and operations of the 1st Defendant is presented to the Deputy Chief Registrar of this Honourable Court.
“An order of Perpetual Injunction restraining the Defendants from selling, charging, mortgaging of otherwise encumbering in any way any of the assets, shares, funds or any of the 1st Defendant’s assets, on behalf of the 1st Defendant Company, all the assets which includes landed properties belonging to the 1st Defendant Company; Bastanchury Power Solutions Nigeria Limited until the final audit report of the accounting books and operations of the 1 st Defendant is submitted to the Deputy Chief Registrar of this Honourable Court.
“An order of the Honourable Court compelling the 3rd and 4th Defendants to disclose before this
Honourable Court all the funds belonging to the 1st and 2nd defendants in their custody and/or funds pertaining to the 1st and 2nd defendants for the purpose of determining the funds due to the Plaintiffs in this suit.”
The plaintiffs supported the motion with a 44 paragraph-affidavit deposed to by Mr. Funsho Adeyemi the Managing Director of the 1st Defendant and the 2nd Defendant herein. Six documents were attached to the affidavit in support and a written address dated February 22, 2023.
However, the defendants through their lawyer, filed a 43 paragraphed counter affidavit dated June 7 2023 deposed to by Oladipo Lawore, a Director of the Bastanchury Power Solutions Nigeria Limited
The defendants also tendered documents marked Exhibits A —J respectively, alongside a written address dated June 7, 2023.
The defendant submitted three issues for determination, which were: “is this suit one that can be appropriately initiated and prosecuted by originating summons?
“What is the respective shareholding of the first plaintiff in Bastanchury Nigeria Limited and Africa Infra Plus Fund in the first Defendant, and are the Plaintiffs entitled to their claims in this suit?”
In determine the suit, Justice Ogundare in his judgment, after reading through all the processes filed by the parties, and weighed the submissions of their respective counsel as well cited plethoras of legal authorites, acceded o the Plaintiffs’ requests and thrown out the defendants’ counters to the suit.
In totality, Justice Ogundare held that: “The Plaintiffs’ prayers before this Honourable Court is for the Court to exercise its inherent power under section 247 of Companies and Allied Matters Act, 2020 and order a General Meeting of the 1st Defendant/Applicant as the 1st Defendant Board of directors obviously will not act.
“That the inherent power of this Honourable Court is not to be affected by the disputations between the parties as the essence of the provisions of section 247 of Companies and Allied Matters Act, 2020, is to boycott such disputes to enable compliance with the statutory provisions……
“….it is clear that the provisions of Section 128(1) (now section 247 of Companies and Allied Matters Act, 2020) should be invoked where for any reasons it is impracticable to call a meeting of a company and that such circumstances as described in the section, the court may order meeting of the company to be called, held and conducted in such manner as the court thinks fit. The sub-section also empowers the court to make ancillary or consequential directions as the court thinks expedient in circumstances in which it may be necessary for such directions to be given as would make the holding and conduct of the meeting possible and/ or effectual…”
“The above position is the crux of the Plaintiffs’ prayers before this Honourable Court and this Court has a duty to act and proceed with the hearing and determination of this Suit as prescribed under Statute to granting the Plaintiffs reliefs before this Honourable Court.
“It is noteworthy, that the provisions of section 247 of Companies and Allied Matters Act, 2020 is not an invitation to the Court to take over or obstruct the running of a company however, the court is duty bound to make such directives in cases of the nature of the instant suit before this Honourable Court.
“The Supreme Court alluded to this fact in IRO V. PARK & ORS. (SUPRA) when it held as follows: “the result is that the legislation has not interfered with the internal running of any company. That is a matter which the law has wisely kept in the hands of those who own the company and directs its affairs. What Section 128 (l)(now section 247 of Companies and Allied Matters Act, 2020) says is that the court may direct the calling and holding of a meeting and give ancillary and consequential directions concerning such a meeting but the deliberations and the decisions remain that of the meeting and are specifically validated by the provisions of Section 128 (1) (now section
247 of Companies and Allied Matters Act, 2020)”
“The arguments in the Written Address in support of the Defendants’ Counter Affidavits are therefore totally unfounded.
“The plaintiffs have averred in their affidavit in support of the Originating Summons that the earlier meetings held by the illegal and relying on the authorities for a meeting to be held to be proper adequate notice ought to have been given to the Plaintiffs. It is in this regard that the Plaintiffs urge the Court to discountenance the argument of the defendants in its entirety and proceed with the hearing of the instant suit to the effect that the calling of an Annual General Meeting will affect or otherwise the effective running of the 1st defendant company which the plaintiffs are stakeholders.
From the foregoing, it is clear that this Honourable Court has the requisite jurisdiction to entertain this suit and grant the reliefs sought by the Plaintiffs.
“I therefore resolve the issue for determination in favour of the Plaintiffs and for the same reason, the Notice of Preliminary Objection of the 1st and 4th Defendants are equally discountenanced.
“Consequently, the court answered all the questions asked by the Plaintiffs in the Originating Summons in the affirmative and hereby ordered as follows: “an order of this Honourable Court ordering a compulsory Annual General Meeting and Board Meeting to be held by the members and Directors of the 1st Defendant Company; Bastanchury Power Solutions Nigeria Limited in compliance with the Provisions of the Company and Allied Matters Act, 2020 (As Amended) within 14 days from the date the Order of Court is made.
“An order of this Honourable Court appointing an external and independent auditor by the Deputy Chief Registrar of this Honourable Court to audit the accounting books and operations of the 1st and 2nd Defendants on the Defendant has unilaterally misappropriated and utilized the funds of the 1st Defendant, towards its funds to wit: Africa Infra Plus Fund (AIPF) to the exclusion of the 1st Plaintiff who is a substantial Shareholder in the 1st Defendant and the 2nd & 3rd Plaintiffs who remain Directors of the 1st Defendant as at the time of filing this suit.
“An order of Injunction restraining the Defendants, their agents, privies, representatives or the like from unilaterally dealing with the assets, shares, funds or any of the 1st Defendant’s assets, shares, funds or chose in action; in any manner whatsoever with all commercial Banks including the following to wit: Guaranty Trust Bank Plc, Access Bank Plc, Citi Bank Nigeria Limited, Ecobank Nigeria Plc, Fidelity Bank Plc, First Bank Of Nigeria Limited, First City Monument Bank Plc, Globus Bank, Heritage Bank Limited, Jaiz Bank, Keystone Bank Limited, Polaris Bank Limited, Providus Bank, Stanbic/ibtc Bank Nigeria Limited, Standard Chartered Bank, Sterling Bank Plc, Suntrust Bank Limited, Union Bank Of Nigeria Plc, United Bank For Africa Plc, Unity Bank Plc, Wema Bank Plc and Zenith Bank Plc, on any accounts whatsoever maintained by the 1st Defendant with the said commercial banks until the final audit report on the accounting books and operations of the 1 st Defendant is presented to the Deputy Chief Registrar of this Honourable Court.
“An order of Injunction restraining the Defendants from selling, charging, mortgaging or otherwise encumbering in any way any of the assets, shares, funds or any of the 1st Defendant’s assets, on behalf of the 1st Defendant Company, all the assets which includes landed properties belonging to the 1st defendant Company; Bastanchury Power Solutions Nigeria Limited until the final audit report of the accounting books and operations of the 1st defendant is submitted to the Deputy Chief Registrar of this Honourable Court.
“An order of this Honourable Court compelling the 3rd and 4th Defendants to disclose before this Honourable Court all the funds belonging to the 1st and 2nd defendants in their custody and/or funds pertaining to the 1st and 2nd defendants for the purpose of determining the funds due to the Plaintiffs in this suit.”
