Justice Ayokunle Faji of the Federal High Cou

rt, Lagos, has ordered three India nationals to pay N98.2 million and additional $325,000 to an 87-year-old businessman, Isaac Oginni, for breach of fair-hearing and the provision of Section 262 of Companies and Allied Matters Act (CAMA).

Justice Faji in the suit, marked FHC/L/CS/1431/2019, also declared that the octogenarian remains a director of his three firms, Bolawole Enterprises Nigeria Limited, Lesag Nigeria Limited and Inter-management Nigeria Limited.

The Indians are Jai Bhagwan Gupta, and his two sons, Vineet Gupta and Rachit Gupta.

Oginni had, in his statement of claims, filed and argued 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 being a first subscriber and director in the first to third defendants, he is entitled to certain benefits, advantages and reliefs from the activities of the three companies.

Besides, he urged the court to render null and void the extra ordinary general meeting of the first, second and third defendants.

He also prayed the court for an order compelling the fourth defendant to render a comprehensive account to the plaintiff.

But the first to sixth defendants, through their counsel, Festus Afeiyodion, in a 45-paragraph counter-affidavit, urged the court to dismiss the plaintiff’s originating summons 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.

Delivering judgment, Justice Faji held that no reasons were given by the defendants for the removal of the plaintiff, which showed a breach of the right to fair-hearing and the clear provisions of Section 262 of CAMA.

The judge noted that the crux of the matter is whether the provisions of the law as regards notice for extra-ordinary general meetings have been fulfilled.

Highlighting relevant sections of CAMA 1990, the judge 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 defendant’s contention that the fourth defendant holds 40,000 fully paid up shares in the first defendant, as at 1987, the court stated that in Exhibit 1009, it was clear that the company’s share capital is now 100,000,000 ordinary shares of N1.00 each.

The court held that “the fourth defendant holds 38,000,000 of those shares, which are not even paid for. The defendants have not controverted exhibit 1009 and the 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 fifth defendant had 15 million of 100 million but the shares were not paid for.

“The 4th defendant had 38 million shares as at February 1, 2023. It does not show that as at the date of the extraordinary 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 plaintiff is a director and remains a director of the first to third defendants 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 plaintiff’s deceased wife to wit: Directors’ payments of N13.9 million, vacation benefit of N12 million, yearly bonus of $150,000 and N55.5 million.

“I, therefore, grant the plaintiff the sum of N81 million and $150,000. This sum covers his benefits up to August 17, 2017, when exhibit 1003 was made. The vacation allowance was N1 million yearly. The period from 2017 to date is seven years. An additional sum of N7 million 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 N1.4 million for seven years is N9.8 million. Up to date therefore, the plaintiff is entitled to the sums of N98.2 million and $325,000,” the court held.