Boardroom Crisis: Court Orders First Bank To Revert To Pre-AGM Status 

Justice Akintayo Aluko of the Federal High Court in Lagos has restrained First Bank Nigeria Holdings Plc, from implementing all the decisions reached in its recently held 10th Annual General Meeting (AGM) held on June 20, 2022, in Lagos.

Justice Aluko specifically ordered FBN Holdings Plc and other respondents in the suit to maintain the status quo ante bellum prevailing before the AGM was held.

The order of the court followed a motion ex-parte filed by an aggrieved shareholder on July 6, 2022, seeking to preserve the subject matter of the suit.

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The order of the court had effectively stalled the appointment of Nnamdi Okonkwo, as the Group Managing Director and Julius Omodayo Owotuga, as a Non-Executive Director.

Also, by implication of the order, the court has stopped the respondents from raising or issuing shares capital of the company and from implementing any of the resolutions reached at the 10th AGM.

The respondents in the suit are First Bank Holdings Plc, Alhaji Ahmed Abdullahi, Chairman of the Board of Directors, Julius Omodayo-Owotuga, Non-Executive Director and Nnamdi Okonkwo, Group Managing Director.

The suit was instituted by one of the shareholders of FBN Holding Plc., Olusegun Onagoruwa.

Onagoruwa had claimed in the suit that the affairs of the company are being run illegally and oppressively.

He alleged that he was not served with a statutory notice for the 10th AGM of the company which was held on 20th June 2022.

The plaintiff contended that he was by law entitled to be served with notice of the AGM and having not been served, there is a case of breach of his constitutional right to a fair hearing in the determination of his civil rights and obligations.

He also argued that the law is settled that once a breach of fair hearing has occurred, any decision taken under such breach must be set aside by the court.

The plaintiff also maintained that the decisions and resolutions of the 10th AGM, held on June 20, 2022, especially about the appointment of Directors, were null and void as shareholders were not allowed to know and approve the new Board of Directors appointed for the company by the Central Bank Governor and that the powers of the CBN Governor to sack or appoint directors for the company did not take away the powers of shareholders to confirm such directors.

Onagoruwa, in a 52-paragraph affidavit filed in support of the suit, stated that he is a shareholder of FBN Holdings Plc and he was not served with notice of the AGM held on June 20, 2022, at Oriental Hotel.

He also claimed that the AGM had not confirmed or approved the appointment of the Board of Directors constituted by the Central Bank Governor before the said board proceeded to appoint Nnamdi Okonkwo as Group Managing Director and Julius Omodayo-Owotuga as Non-Executive Director.

The plaintiff also averred that the kernel of the matter is the decision and resolutions reached at the just concluded Annual General meeting of the first Respondent held on Monday, 20, June 2022. And that his rights as expressed in the petition which includes the right to be personally served with Notice of the Annual General Meeting of the first respondent, have been breached, hence the instant application.

He further stated that it is imperative to allow the Court to determine all issues and reliefs sought on the merits without any interference from any party implementing, concerning the meeting, acting on, or executing decisions reached at the General Meeting of the first Respondent held at Oriental Hotel, Lagos held on Monday, June 20, 2022,

Onagoruwa further averred that there is a binding obligation upon the Respondents to maintain the status quo of the subject matter of the Petition and not to take any step that may overreach the petition or foist a situation of complete helplessness upon the court in the hearing and determination of the Motion on Notice for interlocutory injunction and the Petition filed herein, as any step taken by the Respondents to further implement or execute the decisions and resolution reached at the said AGM of the first Respondent held on June 20, 2022, will undoubtedly usurp the constitutional powers and authorities of the court to determine the real issues and subject matter of the case already submitted to it by the Applicant.

Citing some of the decisions taken at the AGM which the petitioner alleged would infringe on his right and overreach him if not stopped, includes: “declaration and payment of a dividend of the first respondent (FBNH), presentation of Audited Accounts of the first respondent to members, Election of third respondent (Julius B. Omodayo-Owotuga) as a Non-Executive Director and the fourth respondent (Mr Nnamdi Okonkwo), as the Group Managing Director, both of whom were said to have been appointed by the Board of Directors of FBNH.”

The steps also include: “approval of the shareholders to the Board of Directors of FBNH to issue the outstanding, un-issued shares in the authorised share capital of the first respondent in compliance with Section 124 of the Companies and Allied Matters Act, 2020 (“CAMA 2020″), the appointment of the first respondent’s Audit Committee members. Remuneration and expenses of the first respondent’s Auditors, Remuneration of Managers of the first respondent.”

After granting the order to maintain status quo ante Bellum, Justice Aluko adjourned the case to July 22 for further hearing.

6th December 2022
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