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CAMA brouhaha

By AbduRafiu
27 August 2020   |   3:14 am
When Professor Chidi Odinkalu, lawyer, public spirited and an indefatigable activist, raised an alarm on the tinkering to the Companies And Allied Matters Act (CAMA) by the National Assembly...

When Professor Chidi Odinkalu, lawyer, public spirited and an indefatigable activist, raised an alarm on the tinkering to the Companies And Allied Matters Act (CAMA) by the National Assembly, he spoke of a bill before the legislators to regulate Non-Governmental Organizations (NGOs). Although, most people believe the NGOs have done marvelously well they did not pay much attention to the bill, they simply shrugged their shoulders. It was never suspected that the amendment would be so far reaching as to stir the hornet’s nest. I myself thought it would just be a matter of dotting the i’s and crossing the t’s, to bring the companies organic law to speed. What was there to amend, after all? Chief Chris Ogunbanjo, a most outstanding corporate lawyer, and his team had done a great job drawing up articles that became Companies And Allied Matters Decree 1990. They were commissioned to produce the document by President Ibrahim Babangida. With Babangida signing it into law in January, 1990, what we used to know as Land (perpetual Succession) Act was repealed and it became an archival material for purposes of research. Upon the country returning to a democratic order, what used to be known as CAM lapsed into an Act of Parliament with little amendments in 2004, alias CAMA.

The new amendment to CAMA signed into law by President Muhammadu Buhari is exhaustive. In the1990 CAMA for example, Appointment of auditors was in Chapter 2, Section 357. In the amended Act, it is in Chapter 15, Section 401. In between is loaded. Under Publication of Financial Statements in the old law of 1990 now amended Section 354(1) says as follows: “This section shall apply to the publication by a company of full individual or group of financial statements, that is to say, the statements required by Section 345 of this Decree (Act) to be laid before the company in general and delivered to the Commission including the director’s report, unless dispensed with under paragraph 3 of Schedule 6 to this Act, but does not apply to interim financial elements.”

The amended version reads: “This section applies to the publication by a company of full individual or group financial statements, required by section 388 to be laid before the company in general meeting and delivered to the Commission, including the directors’ report, unless dispensed with under paragraph 3 of the Fourth Schedule to this Act, but does not apply to interim financial statements.” In this amended version, the word ‘shall’ is dropped. Since a law is binding; it is self-enforcing, the framers probably thought to add ‘shall’ would amount to tautology because ‘shall’ means ‘must’. While framers of the previous Act may agree, they probably reasoned that there were occasions what grammarians call emphatic tautology might be called for. I leave all that to lawyers and accountants to worry about.

What interests this column more is Part F, the Section on Incorporated Trustees. It is Section 823 of the Act as amended. Titled ‘Incorporated Trustees’ it says ”where two or more trustees are appointed by any community of persons bound together by custom, religion, kinship or nationality or by anybody or association of persons established for any religious, educational, literary, scientific, social, development, cultural, sporting or charitable purpose, they may if so authorized by the community, body or association(in this Act referred to as “association”) apply to the Commission in the manner provided for registration under this Act as a corporate body.” Section 823 (2) states: “Upon being so registered by the Commission, the trustees shall become a corporate body in accordance with the provisions of section 830 of this Part. Section 824 goes on to state: “The Commission shall determine the classification of associations to be registered under this Part in accordance with the aims and objects of the association.”

The Commission determining the classification of associations to be registered was not in the 1990 Act. Be that as it may I move away from the formalities, to the core issue the section that can be said to be controversial. It is Chapter 4, captioned: “Suspension of Trustees, Appointment of Interim Managers, etc.” It states in part, (1): “The Commission may by order suspend the trustees of an association and appoint an interim manager or managers to manage the affairs of an association where it reasonably believes that:
a). there is or has been any misconduct or mismanagement of the association;
b). It is necessary or desirable for the purpose of
*protecting the property of the association;
*securing a proper application for the property of the association, the purposes of the association of the property or if the property coming to the association;
*the affairs of the association are being run fraudulently.

The trustees shall be suspended by an order of court upon the petition of the Commission or members consisting one-fifth of the association and the petitioners shall present all reasonable evidence or such evidence as requested by the court in respect of the petition. The Act goes on to add: “Upon the hearing of the petition and the appointment of the interim manager, the Court, with the assistance of the Commission, may make provision with respect to the functions to be performed by the interim manager or managers appointed by the order.
*the powers and duties of the interim manager or managers which may include the powers and duties of the trustees of the association concerned; and
*any power or duty specified under paragraph (a) to be exercisable or discharged by the interim manager or managers to the exclusion of the trustees.

The functions are to be performed by the interim manager or managers under the supervision of the Commission. By Commission, according to the explanatory note to the Act means Corporate Affairs Commission. It is to be noted that in the eyes of the Act, religious organizations are associations. That is not all, upon the petition of the Commission or members of the association, a court may order or suspend any person, officer, agent or employee of the association from office or employment, provided that such suspension does not exceed 12 months from the date of the order or suspension, and by its order appoint such number of additional trustees as it considers necessary for the proper administration of the association. By order of the court, property of the association is to be vested in the official custodian who shall be a person designated by the court from time to time. Any person who holds any property on behalf of the association cannot part with it without the approval of the court. The Commission may be asked to establish a scheme for the administration of the association. What a draconian legislation!

It is shocking that the government is unable to classify corporate organizations and categorize them into strictly companies set up for business enterprises and charities set up for help and support as their primary objectives. And it does not shrink from contemplating handing over religious organizations into receiverships.

It pretends not to know how religious organizations develop in Nigeria. A church, for example, may start from the living room of a person who, sensing something from deep within him which he can hardly explain and feels driven to start a weekly or twice weekly fellowship with one, two, three of his neighbours. That is how most indigenous churches started in our country. Have you heard of Mrs Immanuel and Babalola who founded Apostolic church? Have you heard of Fadayomi who founded the Redeemed Christian Church? In a vision he saw a young man who would succeed him. And behold, the young man teaching mathematics at the University of Lagos, surfaced dragged there by his wife. The young man turned out to be Enoch Adejare Adeboye, and the wife, Folu. He started as a translator, translating the sermon of Pastor Fadayomi from Yoruba to English.

In practically all cases, the circle of attendants grows from one room. The man with the dream raises some capital and builds a church to accommodate more congregants. Is that the church for which an interim manager will be appointed to run its affairs when there is a disagreement or conflict among its members? How does a mosque start? A man deeply moved, with like-minded persons in the neighbourhood or even joined by passers-by, stands in front of his house to observe the five worship hours for the day. When the man retires he uses his gratuities to build a mosque and an Islamic scholar is found to lead prayer sessions. Is that the mosque described as property which is to be vested in an official custodian and a scheme drawn up for its administration by the Corporate Affairs Commission whose registrar may not even be a Moslem?

In the discarded Act, an incorporated organization may be dissolved by Court following a petition for a number of reasons, if for example the aims and the objective undergirding its establishment have been realized. Categorizing faith-based organizations and business companies was not in the discarded Act, but the Act did not make provision for them to be taken over by an interim manager when there are disagreements. The Corporate Affairs Commission is being likened to the Charity Commission in the UK, but it is well known that partisan influences cannot be brought to bear on its activities. In any case, how many Britons go to church?