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FBN Holdings AGM: Appeal Stalls Proceedings In Shareholders Suit

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Justice Akintayo Aluko of the Federal High Court in Lagos on Tuesday ordered parties in the suit filed by three aggrieved FBN Holdings Plc shareholders over the Annual General Meeting of the company held on August 15, 2023, to file written addresses on whether he can proceed with the hearing of the matter.

At the resumed hearing of the suit yesterday, Justice Aluko informed parties of the pendency of the Notice of Appeal filed by FBN Holdings Plc, asking him to stay further proceedings in the matter.

Justice Aluko therefore asked counsel in the matter to address him on whether the court can proceed with the case in view of the Appeal pending before the Court of Appeal and another application seeking a stay of proceedings.

However, counsel to the petitioners, Dr. Muiz Banire, SAN, while reacting to the observation submitted that a notice of Appeal cannot act as a stay of proceedings, adding that the there is no appeal before the court since the appeal is yet to be entered.

Banire argued that the the court can proceed with the hearing of the matter as his application has nothing to do with the issues raised in the appeal.

But Justice Aluko while interjecting him, said it would not be wise for him to close his eyes to the notice of appeal as that would amount to insurbordination.

Counsel to the respondents, Mutalubi Adebayo, SAN, as well as counsel of parties seeking to be joined, Kazeem Gbadamosi, SAN, Adesoji Adedoyin, SAN, and Babajide Koku all pleaded with the court to give them time to address the court on whether it can proceed with hearing of the matter in view of the pending appeal and the application for stay of proceedings in the case.

Some aggrieved shareholders, Olojede Adewole Solomon, Adebayo Oluwafemi Abayomi, and Ogundiran Emmanuel Adejare had urged the Federal High Court for an order stopping the bank’s Annual General Meeting scheduled for August 15 pending the hearing of their suit number FHC/L/CP/1575/23.

FBN Holdings Plc had in its Notice of Appeal asked the court to nullify an ex-parte order granted by Justice Nicholas Oweibo of the Federal High Court, which stopped the bank’s Annual General Meeting (AGM).

The Holding company, in a Notice of Appeal filed on its behalf by its team of lawyers led by Mutalubi Adebayo (SAN), is also asking the upper court for an order allowing its appeal and an order directing that a different Judge of the Federal High Court Lagos be assigned to hear the substantive matter.

The lawyer further argued that the lower court lacked the jurisdiction to grant the ex-parte order because the condition precedent under the Federal High Court Rules for the hearing of the suit was not met by the petitioners.

Three aggrieved FBN Holdings Plc shareholders, Olojede Adewole Solomon, Adebayo Oluwafemi Abayomi, and Ogundiran Emmanuel Adejare, had approached the court presided over by Justice Nicholas Oweibo seeking an order stopping the bank’s Annual General Meeting scheduled for August 15 pending the hearing of their suit number FHC/L/CP/1575/23.

In his ruling delivered on August 9, 2023, Justice Oweibo directed FBN Holdings Plc not to hold its scheduled and statutory AGM until the issues before the court were resolved.

However, FBN Holdings Plc, in its appeal filed on six grounds of law, urged the appellate court to set aside the ex-parte order and that it should assign the matter to a new judge for hearing.

The appellant argued that the trial judge erred in law when he granted the prayer sought by the respondents in their Motion ex parte dated August 8, 2023 while they were seeking the same relief in their substantive suit before the same court.

Adebayo contended that by granting the respondents prayer, the judge prejudged the substantive issues even before they were heard.

The lawyer also submitted that the lower court lacked the jurisdiction to entertain the respondents’ suit and also to grant the prayers sought in the motion ex parte when the condition precedent for the hearing of urgent action during the long vacation of the court was not fulfilled.

He further maintained that the judge erred in law when he granted the order to restrain FBN Holdings from complying with the statutory duty under Section 237 of CAMA 2020 to wit, holding its Annual General Meeting.

Adebayo stated that the holding of an Annual General Meeting of a Public Liability Company is a statutory duty whose performance cannot be restrained by the grant of an injunction.

The senior lawyer argued that by Section 237(1) of the Companies and Allied Matters Act, No. 3 of 2020, the holding of an Annual General Meeting by a Public Liability Company is mandatory.

He also claimed that section 237(5) of the Companies and Allied Matters Act prescribes sanctions against any Company and every officer of the Company if default is made in holding the Annual General Meeting of the company.

Adebayo further insisted that the lower court judge erred in law when it assumed jurisdiction to entertain the suit and proceeded to grant prayers sought by the respondents without the leave of the court first sought and obtained.

He submitted that Justice Oweibo erred in law when it entertained and granted the order to restrain FBN Holdings from holding its Annual General Meeting when no real urgency was disclosed by the affidavit supporting the application.

The SAN stated that one of the vital conditions for granting of an interim order of injunction is the existence of real urgency and not a self-induced urgency.

Adebayo further claimed that the trial judge erred in law when he assumed jurisdiction to entertain the petition and proceeded to grant the prayers sought despite the Petition being in contravention of Order 5 Rule 2(2)(a) – (d) of the Federal High Court (Civil Procedure) Rules of 2019

The respondents have not file their reply to the appeal, and no date has been fixed for its hearing.

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