SUMMARY OF JUDGMENT OF..INDEPENDENT SHAREGOLDERS ASSOCIATION OF NIGERIA (ISAN) VS FINANCIAL REPORTING COUNCIL (FRC) Before Justice A. O. Faji. Suit No. FHC/L/CS/1026/16

SUMMARY OF JUDGMENT OF..INDEPENDENT SHAREGOLDERS ASSOCIATION OF NIGERIA (ISAN) VS FINANCIAL REPORTING COUNCIL (FRC) Before Justice A. O. Faji. Suit No. FHC/L/CS/1026/16 A FEDERAL high court sitting in Lagos has overruled Financial Reporting Council, FRC,  Rule 2(c) that only qualified accountants can be a chairman of the audit committee of a Public Liability Company, Plc. Under SUIT NO FHC/L/ CS/1026/16 before Justice A O Faji with Barrister Chuks Chukwemeka as the lead counsel for Independent Shareholders Association of Nigeria, ISAN, the court stated that: “ The defendant, FRC has no power under the Financial Reporting Council of Nigeria Act to make any rule stipulating a qualification for membership or headship of audit committees of companies incorporated under the Companies and Allied Matters Act, CAMA; the defendant has no power under the Financial Reporting Council of Nigeria Act to prescribe any standard of financial reporting or any other standard that requires of any company incorporated under the Companies and Allied Matters Act anything that is inconsistent with or that modifies in any respect any provision of the Companies and Allied Matters   Act and the defendant is bound to exercise its functions in accordance with any law in force in the country and therefore may not prescribe any standard or make any other prescription which is inconsistent with any other law made by the National Assembly.” Judicial symbol In a press statement made available to Vanguard, the National Coordinator, ISAN, Mr. Adeniyi  A. Adebisi, said: “We as an Association considered the Rule 2(c) of the FRCN as an anomaly and meddlesome in the extreme because it was against the letters and spirit of the Companies and Allied Matters Act (CAMA) section 359. We engaged the Executive Secretary of the FRCN on a number of occasions to reverse itself regarding the said rule, but it refused to do so. It insisted that a chairman of an Audit Committee of a public quoted company must be one professionally qualified as an accountant. To add salt to injury, public companies that could not provide a professionally qualified accountant as their Audit Committee chairman were required to apply for a waiver before their annual accounts can be approved. FRCN collects a sum of N600,000.00 for the so called waiver to be granted.” To this development, he said:” Given this ruling,  affected companies should be able to apply and collect refunds from FRCN for the N600,000 received for waivers under the Rule 2(c) which is now declared null and void.”

Similar fact evidence and Character evidence

In the law of evidence, similar fact evidence (or the similar fact principle) establishes the conditions under which factual evidence of past misconduct of accused can be admitted at trial for the purpose of inferring that the accused committed the misconduct at issue. Evidence of prior bad acts by the accused will be admissible if the prosecution satisfies the judge on a balance of probabilities that, in the context of the particular case, the probative value of the evidence in relation to a specific issue outweighs its potential prejudice and thereby justifies its reception. Questions arise as to how the Court will measure the elements of this rule: i) What constitutes a prior act of misconduct? - Any past misdeed, does not have to proven as a conviction. ii) Why does the Court speak of evidence in relation to a ‘specific issue’? - Good measure of probity, what other issue beyond disposition or propensity evidence. iii) How is probative value determined? - Nature of similarity between details, distinctive features and circumstances of past act and current offence - Proximity in time between past act and current offense - Number of occurrences of the similar acts - Any intervening event - Any other factor tending to support or rebut the unity of past act and conduct in question (i.e. appearance of collusion) Whereas  Character evidence is a term used in the law of evidence to describe any testimony or document submitted for the purpose of proving that a person acted in a particular way on a particular occasion based on the character or disposition of that person. In the United States, Federal Rule of Evidence 404 maps out its permissible and prohibited uses in trials. Three factors typically determine the admissibility of character evidence: the purpose the character evidence is being used for the form in which the character evidence is offered the type of proceeding (civil or criminal) in which the character evidence is offered ‎ Similar fact evidence can be used even if the original "misconduct" could not be prosecuted due to duress or the offender's youth. See the Supreme Court case of Din v. African Newspapers of Nig. Ltd.(1990) 3 NWLR (Pt.139) 392 ‎

Undefended List Procedure

It is trite that where the Defendant, in an undefended list procedure, admits a liquidated debt in writing, he has afforded the plaintiff good ground for instituting the procedure. Eldorado (Nig.) Ltd. v. Jimfat (Nig) Ltd (1973) 3 CCHCJ 93; Aikabeli v. A.P. Plc. (2001) 6 NWLR (Pt.708) 93

instances where amendments of pleadings will not be granted

It is trite that parties are at liberty to amend their pleadings whenever it is appropriate to do so in order to bring into focus the real issues in controversy for determination by the court BUT.... An amendment that gives an impression of an act in BAD FAITH is not to be entertained and allowed. What is paramount in the mind of the court always is to ensure that justice is served to all parties who should not be allowed to take UNDUE ADVANTAGE of the other. The court in checking against any such surreptitious motive will always consider the balance of convenience between parties of the outcome of the application. In general, amendment which will enhance the Justice of a case will hardly be refused by any court except however it occurs to the judge in his opinion that the intention is FRAUDULENT and with a HIDDEN AGENDA which will generally work INJUSTICE against the opponent. The law in such a situation has therefore given the court wide discretionary powers to exercise in the determination of each case which should be considered always on its own peculiar circumstances, bearing in mind that same sets of cases with similar facts may not necessarily yield the same outcome. Amendments are more easily granted where the grant does not necessitate the calling of additional evidence or changing the character of the case on the ground that no prejudice would result from the amendment. Laguro v. Tolu (1992) 2 NWLR (Pt.223) 228; Imonikhe v. A.-G; Bendel State (1992) 6 NWLR (Pt.248) 396

grounds of law, facts and mixed law and facts

In giving a distinction between a ground of law and a ground of fact of mixed law and fact, the Supreme Court had evolved certain principles that would assist the courts. A question of law connotes one of three meanings to wit: (a) a question a court is bound to answer in accordance with a rule of law; or (b) a question which explains what the law is; or (c) a question which normally answers questions on law only and invariably, falls within the judicial power of a judex to answer. Contrariwise, a question of fact denotes one of three meanings, viz:- (a) a question which is not determined by a rule of law; or (b) any question except one as to what the law is; or (c) any question which is to be answered by the Jury and not the Judge. Thor Ltd. v. F.C.M.B Ltd (2002)4 NWLR (Pt.757)427; FBN Plc v. T.S.A Ind.Ltd. (2010) 15 NWLR (Pt.1216) 247; General Electric Co. v. Akande (2010) 18 NWLR (Pt.1225) 596; Abubakar v. Waziri (2008) 14 NWLR (Pt.1108)507; Ugboaja v. Akitoye-Sowemimo (2008) 16 NWLR (Pt.1113) 278

Jurisdiction and competence of action

Jurisdiction is the authority of a court to entertain a matter pre sented before it. A competent action infuses jurisdiction into a court and makes it amenable to adjudication. The converse is true. An incompetent suit dispossesses a court of the jurisdiction to entertain it. Put strictly, the competence or incompetence of an action is a jurisdictional issue. There is therefore no distinction between jurisdiction and competence of action. Madukolu v. Nkemdilim (1962) 2 SCNLR 341

whether litigant can appear as legal practitioner for himself and co- litigant

A litigant who is a legal practitioner conducts his case as a litigant,not as a legal practitioner representing himself,, the litigant. Thus,a person cannot appeal both as a person, and as a counsel for himself. There cannot be a mixture of the two characters. Hence a litigant who is a legal practitioner cannot represent a co-defendant, because he is also not appearing as a legal practitioner, but as a litigant. On the other hand, a litigant who is a legal practitioner has the right like any other litigant to engage the services of a legal practitioner to represent him. Fawehinmi v. NBA (No . 1 ) ( 1987 ) 2NWLR (Pt.105)494