Lagos – His Lordship, Hon. Justice Elizabeth Oji of the National Industrial Court of Nigeria, sitting in Lagos, on Friday 12th April 2019 has dismissed the suit filed by Union Homes Savings And Loans Plc against Union Bank Of Nigeria Plc for lack of jurisdiction.
The court held that none of the objectives of the Transaction Implementation Agreement falls under any of the provisions of the sub-paragraphs of the 254(C) of the Constitution of the Federal Republic of Nigeria (As Amended) relied on by the Claimant, either directly or relationally.
In summary, the Claimant brought this action by an Originating Summons dated 26th April, 2018 and sought against the Defendant among others; A declaration that pursuant to clause 1 of the Transaction Implementation Agreement, Staff Liabilities means all of Union Homes Savings & Loan Plc. employee severance obligations as are outstanding up to January 31st 2014 which shall be paid by Union Homes Savings & Loan Plc.; and in respect of which Union Bank Nigeria Plc. shall create a credit line for Union Homes Savings & Loan Plc. (to be subsequently written off entirely by Union Bank of Nigeria Plc.); provided that the payment to employees shall be the balances outstanding following the off-set of staff obligations due to Union Homes Savings & Loan Plc.
A declaration that the employee severance obligation of Union Homes Savings & Loan Plc. staff includes redundancy benefits as provided in Clauses 8.11 and 8.12 of the Union Homes Savings and Loans Plc. Staff Policy Guideline of July 2007 and the judgment of this court of 13th July 2015 in Suit No. NICN/LA/232/2014 AdemulegunGbengaCosmas&223 Others v. Union Homes Savings and Loans Plc.
or in the alternative, An order directing Union Bank of Nigeria Plc. to immediately create a credit line for Union Homes Savings & Loan Plc. and provide to Union Homes Savings & Loan Plc. the appropriate and proper sum after due reconciliation by both parties for the purpose of settling Union Homes Savings & Loan Plc. outstanding staff liabilities and employee severance obligations as contracted in Clauses 5.1.3.3, 9.2.4 and 11.2.4 of the Transaction Implementation Agreement.
The Defendant-Union Bank Of Nigeria Plc filed a Notice of Preliminary Objection sought for an Order striking out the suit on the ground that this Court lacks the jurisdiction to entertain the matter on the grounds that the Contract is for sale of shares and take-over of the assets and liabilities of the Claimant and the Contract is pursuant to Companies and Allied Matters Act, Cap C20, LFN, that the entirety of the reliefs sought in this suit is also premised on the purported breach of the Contract i.e. Transactions Implementation Agreement between the Claimant and the Defendant and Aso Investment Nigeria Limited and UH Investment Nigeria Limited, that the Claimant’s cause of action and this suit does not fall within any of the provisions of Section 254(C)(1)(a) - (k) of the Constitution (As Amended).
The Claimant-Union Homes Savings And Loans, in response argued that the contract has several parts which include the issue of terminal benefits to be paid by the Applicant to the Respondent’s ex-staff. Claimant argues that the cause of action is the issue of terminal benefits which is distinct from the issue of sale or transfer of shares.
The Claimantsubmitted that the use of the word ‘notwithstanding’, in section 254(C) implies that section 254(C)(1)a & k takes pre-eminence and should be applied as this case is arising from the non-payment of gratuities and other entitlements.
In response to the Claimant’s counter-affidavit, The Defendant argued that if the cause of action in this suit is indeed relating to pensions, gratuity, allowances of employees, then the employees whose pensions and gratuities are in issue are meant to be part of this Suit.
It is Claimant’s case that the Transaction Implementation Agreement comprise of and contains the whole terms and conditions of the agreement and did not make any provision for the set off of the Claimant’s debt by the Defendant, but stated in Clause 9.2.4 that the Defendant shall create a credit line for the purpose of staff liabilities which credit line shall be written off entirely by the Defendant.
Defendant states that it has complied with the provisions of the Agreement and it is the Claimant that is owing the Defendant. Defendant further states that it is not a party to the Claimant's employee suit before the NIC and by virtue of the provisions of clause 5.1.3.3 of the Agreement it is either the Defendant applies the proceeds of the sale of the HFC Banks shares or creates a credit line. The Defendant contends that it is Claimant’s responsibility to meet any other obligation to its staff outside what was contemplated and agreed under the Agreement.
After careful evaluation of all the processes filed, and the submissions of the learned Counsel from both sides, the Court presided by Hon. Justice Elizabeth Oji expressed thus;
“Looking at the document sought to be enforced, it is obvious that none of the parties stand in an employer – employee relationship with the other; nor does any of the other relationships or circumstances stated in paragraphs (a) and (k) exist amongst them.
“Further, none of the objectives of the Transaction Implementation Agreement falls under any of the provisions of the sub-paragraphs of the section 254(C) relied on by the Claimant, either directly or relationally.
“I do not find that this objective is anywhere labour related or related to any of the other heads of section 254(C)(1) a&k. I have also considered the provision of paragraph J of section 254(C)1(j) and do not find that the Transaction Implementation Agreement can conveniently fit into any of it.
“I do not see how the transaction above is related to or connected with or arising from the payment or non-payment of salaries, wages, pensions, gratuities, allowances, benefits and any other entitlement of any employee, either of Claimant or the other parties to the Transaction Agreement. If there was (which it is not), then I would agree with the Defendant that the employees of Claimant, whose interests are in issue, should be the right persons to bring this action.
“After considering the Claimant’s claim and reliefs sought, I do not see how the dispute bothers ‘squarely and exclusively’ on payment of terminal benefit to employees as argued by the Claimant. I am convinced that this Court does not have jurisdiction to hear this suit, as presently constituted. This suit is thereby liable to be dismissed, and is hereby dismissed.
In line with my initial finding that this Court lacks jurisdiction to hear this suit, this suit is hereby dismissed.
