IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA
IN THE ENUGU JUDICIAL DIVISION
HOLDEN AT ENUGU
BEFORE HIS LORDSHIP: HON. JUSTICE O.O. AROWOSEGBE
DATE: WEDNESDAY JANUARY 10, 2024 SUIT NO: NICN/EN/49/2019
BETWEEN:
ANEKE ARINZE LEONARD……………………..……………………CLAIMANT
AND
ECOBANK NIGERIA LIMITED……………………………………..DEFENDANT
(The Pan African Bank)
APPEARANCES:
1. D.A. ANEKE – FOR THE CLAIMANT.
2. EMEKA NEBO – FOR THE DEFENDANT.
JUDGMENT
INTRODUCTION
COMPLAINT commenced this suit 29th October 2019. The claimant filed Statement of Facts [SF] along. The reliefs claimed in para 49 therein are as stated below:
1. A declaration that the Claimant fulfilled all his obligations under the contract.
2. A declaration that the defunct BFCL Assets & Securities Ltd being the stock broking company of the defendant, and was introduced by the defendant to the contract, was an agent of the defendant.
3. A declaration that the defendant breached his obligations to the claimant under the contract and is therefore disentitled to claim any debt resulting out of its own failure against the claimant.
4. A declaration that the defendant was wrong when it unilaterally took a decision to make deductions on the terminal benefits of the claimant as a result of the contract breached by the defendant.
5. A declaration that the failure to apply clause 5 and the Irrevocable Power of Attorney executed by the plaintiff [sic] in that regard in favour of the defunct BFCL Assets & Securities Ltd and the MD Oceanic bank [sic] International Ltd to sell the shares and recover the principal amount is a breach of their obligation to the claimant under the contract.
6. A declaration that the “Re: Facility Restructuring offer letter” was entered into by the claimant under undue influence, and is therefore void and of no effect.
7. A declaration that the failure of the defendant to issue instruction to CBG(Corporate Banking Group) [sic] to sell at the moment the shares fell below 15% of the purchase value amounts to a breach of contract and entitled the claimant to award of damages and compensation.
8. Injunction restraining the defendant from relying under the “Re: Facility Restructuring offer letter” to claim, deduct, and/or demand any further payment from the plaintiff [sic].
9. A declaration that the seizure of the plaintiff’s [sic] salary for 10 consecutive months while he was still at work, deduction of his entitlement based on purported indebtedness arising from the contract, and deductions from his monthly salary are unlawful, null and void.
10. An order directing the defendant to refund to the plaintiff [sic] all monies deducted from his account to the benefit of the defendant from the moment the shares fell below 15% of the purchase value and the defendant failed or neglected to sell to recover the principal.
11. An order directing the defendant to pay to the claimant his full exit entitlement without any deduction.
12. N50,000,000.00 being general and special damages against the defendant.
13. 25% interest on the Judgment sum, including the exit entitlement until it is fully and efficiently paid.
Reacting to the above, the defendant filed Statement of Defence [SD] on 29th September 2021 to which the claimant replied by Reply to Statement of Defence [RSD] filed 20th October 2021. Thus, issues were completely joined. My next duty is to summarise the pleadings.
SUMMARY OF THE PLEADINGS
A: Claimant’s Story
The claimant pleaded that as a staff of Ecobank Nigeria Ltd [ENL], his appointment was terminated May 15, 2019 and that he, entered into the contentious contract for share purchase facility, September 30, 2007, then a staff of Oceanic Bank Plc [OBP]. He pleaded that OBP was later acquired by ENL. He pleaded the terms of the contentious contract, which included absolute collateral rights to secure ENL’s interests, especially irrevocable power of attorney and right to sell the shares once the price dropped below 15% of the offer price. The claimant pleaded too that, the defendant secured a brokerage firm, which exclusively conducted her stock business, solely introduced into the contract by the defendant without the claimant’s knowledge. The claimant pleaded that; he fulfilled the terms that devolved on him for the 12-month 27M-facility. The claimant pleaded too that, it was a standard form contract. The claimant pleaded further that, the defendant later demanded for management fee of 270Thousand, which he paid. The claimant pleaded that; the defendant unilaterally extended the tenure by a year and debited the claimant with another management fee.
The claimant pleaded that, for the two years, the defendant debited the claimant with N3,172,889.68 interest and a total debit of N16M. The claimant pleaded that; he discovered that, as at the time the contract was unilaterally extended, the shares had actually fallen below 15% of purchase price. The claimant pleaded that; the defendant abused her position as the claimant’s employer to unilaterally extend the facility’s tenure, hoping that, the stock would recover instead of selling off the shares according to clause 5 of the contract. The claimant pleaded that; the defendant had all the expertise and facilities to monitor the volatility of the shares but failed in her duties. The claimant pleaded that, as a staff of the defendant, he subtly complained but the defendant took no heed but instead, continued to debit him. The claimant pleaded a newspaper as the source of his knowledge that the defendant was careless about her responsibilities in the contract.
The claimant pleaded that thereafter, the defendant resorted to intimidations to compel him to accept responsibility for her failure. He gave examples of the intimidations as seizure of his salaries for 9 months and the simultaneous transfer from Awka in Anambra State to Ogoja in Cross-River State with new roles in an unsuitable environment, where he had no friends. He pleaded that, he was further threatened that, he would lose his job if he failed to accept liability and that, all these subjected him to untold hardship, which made it impossible to meet his family obligations and turned him into incurable debtor, who was unable to take care of his family and, which affected his reputation. The claimant pleaded that, as result, he wrote the defendant to complain about the forlorn situation imposed on him and that; the defendant ignored his mails. The claimant pleaded that; he was later invited to the head office in Lagos and put under severe pressure to accept the liability for the defendant’s failure to perform her obligation to sell at the appropriate time; and that, he succumbed to the overbearing pressure from his superiors.
He pleaded that, he offered to pay N500thousand as full and final settlement but the defendant insisted on N8M and later put it in the offer letter of June 15, 2016 that he had no right to seek redress in the courts and, upon protest, the defendant withdrew the clause and gave him another retaining the N8M. He pleaded that the defendant continued to debit his account until his appointment was terminated May 15, 2019 with his gratuity eroded. The claimant pleaded that; he discovered that it was only N5M that was actually approved. He pleaded that, he wrote to the defendant on this August 13, 2019 and the defendant replied August 26, 2019 that, she was investigating the issue and that; nothing has been heard thereafter till date. The claimant pleaded that, as a result, he filed this suit claiming the reliefs earlier stated above. That being the end of the summary of the SF, I move to summary of the SD.
B: Summary of the Defendant’s Counter-Story
The defendant counterpleaded paras 10-13 of the SF that, the clause 5 could only be activated on the claimant’s approval and that, the defendant, did not incorporate the brokerage company alleged. The defendant further counterpleaded paras 10-15 that, the claimant knew that the shares fell below 15% of the purchase price in the first year, yet failed to notify the defendant to sell, and as such estopped; as he was obliged to monitor his investments. The defendant counterpleaded para 17 of the SF that the terms of the contract were communicated to the claimant and he executed it without coercion. The defendant also counterpleaded paras 18-23 that she could not unilaterally sell the shares, as alleged but only took custody of the shares documents in line with banking security policy until liquidation of the loan and that, the contract was renewed due to the bearish state of the capital market to the claimant’s knowledge and without protest; and as such, the claimant acquiesced.
The defendant counterpleaded paras 25-29 of the SF that, the defendant could not utilize the irrevocable power to sell without the claimant’s authorisation and that, in as much as the claimant continued to perform his own monthly obligations before the takeover of Oceanic Bank, he could not claim that, there was a default; as the defendant counterpleaded paras 30-31 of the SF that, the defendant only took over Oceanic Bank in 2011, and therefore, has the responsibilities to recover all debts owed to Oceanic Bank without intimidation. The defendant counterpleaded paras 32-33 that, she did not seize the claimant’s salaries but applied them to defray the indebtedness accruing from the facility and that, this was in line with the terms of the contract and that, the claimant was transferred and assigned new role in the normal routine and he was not the only person so transferred. The defendant counterpleaded further that; the claimant was properly assigned new roles.
The defendant counterpleaded paras 34-39 of the SF that the claimant was merely invited for a negotiation and possible write off of part of the debt and was never coerced or unduly influenced to sign the restructuring in 2016, as he would not have objected if the N5M complete liquidation was accepted and that, the defendant communicated to the claimant offer of N8M instead and that, the restructuring letter was withdrawn truly, but not because of any breach but because of discovery that the addendum ought to be part of the restructuring letter and that, the corrected version superseded the earlier. The defendants ended by pleading that the claimant is not entitled to any of the reliefs claimed and that, it would ask the Court to strike out the suit for want of jurisdiction. That being the end of summary of the SD, I move to summary of the RSD.
C: Summary of the RSD
The claimant replied paras 2,4,5,7,8&9 of the SD that the shares were the collateral for the facility for which the defendant had the power of sale once the shares fell below 15% of the purchase price. With regard to para 7 of the SD, the claimant replied he was a junior staff in 2007 on N6M salary per annum, who would not ordinarily be entitled to 27M loan for which the defendant would put up a recovery mechanism for mere administrative convenience and gave further details of how the defendant secured the loan. The claimant replied further that, the defendant ensured that, the defendant’s MD and DG, Stock Exchange were served with the letter of irrevocable power of attorney to enable the sale without further recourse to him. The claimant replied paras 7 & 8 that, the interests were to be debited on the claimant’s salary account on monthly basis for 12 months, while the N27M principal was to be paid at maturity in tune with the practice of margin loans; which was within what ought to be taken within the one-year duration of the contract and that, it was incorrect to say both the interest, and principal were debited to his salary account.
The claimant replied para 9 of the SD that, he was an inexperienced junior staff in 2007 and could not be attributed with the experience to understand the intricacies of such facility to be able to mange it. The claimant replied para 10(a) of the SD that, while it is true that staffers are transferable across roles however, the usual practice is to retain staffers transferred across roles in the same branch to leverage the already established customer relationships in the same location; except where such transfers were requested directly and specially by the staffers, unlike his case where he did not make any request and was transferred from the operations department in which he had served for all his ten years to commercial business department in a different locality with different people and language, thus, lacking the resources to perform well against banking practice.
The claimant replied further that, he received no training in commercial banking before the transfer, while there was no vacancy for a commercial banking officer in Ogoja to which he was transferred and after he left, no staff was transferred to replace him and the replacement was only done two years after he left by converting a contract staff, showing that, there was no urgent need for it. The claimant further replied that, the fact that his salary was seized the very first month of the transfer showed that, it was a ploy to intimidate and subdue him. The claimant replied that, the preparation to seek redress started in 2013 after he was informed of the indebtedness and has nothing to do with the restructuring not binding on N5M. The claimant replied that, he suffered double jeopardy by being paid 40% of his terminal benefits for poor performance, being sacked and debiting the balance of the restructured loan from what was left and that, the claimant, along with others, filed another suit in NIC Lagos Division contesting the 60% deduction, which is different from this case.
I have summarised what I considered to belong to reply pleadings. Thus ended the summary of the pleadings. I move to summarise the proceedings before the Court.
SUMMARY OF PROCEEDINGS
The matter came up first 20th January 2020 and on 16th February 2021, after the Court conditionally deemed the memo of appearance as properly filed pending the determination of the Notice of Preliminary Objection [NPO] filed by the defendant because, the defendant did not pay the requisite default fee, heard the NPO challenging its jurisdiction and adjourned ruling to 12th April 2021 on which date, the NPO was dismissed. The defendant was ordered to pay her default fees while the case was adjourned. It came up on 29th September 2021 and the defendant’s motion to regularise her defence was granted and, the case adjourned for hearing. The case was opened 18th November 2021 with the claimant testifying as CW1. CW1 adopted his Written Statements on Oath [WSOs] made 29/10/2019 and 20/10/2021 and thereafter, Exhibits C1, C2 & C2(a), C3, C4, C5, C6, C7, C8, C9, C10, C11, C12, C13, C14, C15, C16, C17, C18, C19, C20, C21 and C22 were admitted. Application to substitute the originals of exhibits with photocopies was granted unopposed. The case was thereafter adjourned for Cross-Examination [XX] of CW1.
However, on 23rd June 2022 when the matter came up for XX, the learned claimant’s counsel applied to reopen the claimant’s evidence-in-chief to tender a document that he inadvertently omitted to tender the last date when the evidence-in-chief was closed. The learned counsel to the defendant did not oppose this application and it was granted accordingly. Thereafter, Exhibit C23 was tendered unopposed and so marked. Thereafter, the case proceeded on XX. Under XX of CW1, CW1 said he was employed in February 2005 and admitted he signed a contract. He admitted he was not forced to take the loan but that, the loan was restructured without his consent or request and he refused to honour the unilateral restructure and that this was because, every interest debit stopped in the first year. CW1 said when Eco Bank took over and wrote him, he explained that the defendant had a responsibility to secure the loan, which they failed to do.
CW1 said after his response, he was put through a lot of inhuman treatments, which included the stoppage of his salary for ten months, which forced him to negotiate with the defendant; and the defendant made it clear he could only start receiving salary if he agreed to the terms of her restructuring, which was sent to him and he found a clause therein that barred him from going to court, and he said this should be removed before he could sign and it was removed and he executed the contract in order to feed his family. CW1 admitted he and some others filed similar suit challenging why the defendant refused to pay 60% of their gratuities. CW1 however said he had no obligation to check the performance of the investment on which he was given the N27Million loan in 2007 and insisted that, as long as his salary did not get to him, it was seized and not that it was used to offset his obligations under the loan. CW1 however agreed that, the clause “will be authorised”, which was in the contract, was in the future tense. The XX was brought to an end without re-examination. And the claimant closed his case and it was adjourned for defence.
The matter came up on 1st November 2022 and was adjourned because; the defendant and counsel were not in Court with hearing notice ordered issued on the defendant’s learned counsel. It came up again on 13th December 2022 and the learned defence counsel said he initially communicated the witness and that, he was ill and he had lost communication with the witness and could not file his process. The learned claimant’s counsel observed however that, there was nothing before the Court to show the witness was truly sick and that, the learned counsel ought to have fielded another witness, since the defendant is a bank and that, the learned defence counsel did not tell him about the absence of the witness until he called him that morning but nonetheless agreed to the application for adjournment on the condition that, the next date, the matter would go on. The Human Resources Manager [HRM] was in Court and represented the defendant on this date. The case was thereafter adjourned for definite defence.
The matter came up next on 14th February 2023 and the defence learned counsel was not in Court while both parties were absent too. The learned claimant’s counsel reported that, he saw the learned defence counsel in the morning and he told him they had not filed their defence processes but that, they wanted to explore out-of-court settlement and that, he was surprised the same counsel wrote to Court that he was sick and that; when he saw him, he appeared hail and hearty. The learned counsel said the Court would recall that the last date, the defence brought application for substitution of the witness he claimed had been laid off and that; up till date, the processes had not been filed and that, they had been in Court on 01/11/2022 and, 13/12/2022 when the HRM was introduced as the new witness but the Court graciously granted adjournment to enable them file new Written Statement on Oath [WSO], which had not been filed. The learned counsel drew attention to the fact that, the intended witness was not also in Court. The learned counsel said the application for adjournment could not be in good faith particularly so that, the WSO was not filed. The Court acceded to the application for foreclosure against defence and adjourned to 25th April 2023 for adoption of the Final Written Addresses [FWAs] and ordered hearing notice to be served on the learned defence counsel.
The case came up however on the 22nd June 2023 and on this date, the defence made application for leave to reopen the case, which was not opposed because, it was made to appear as if the witness was actually in Court on which basis the Court granted the application, even though, the claimant had filed his FWA since 6th April 2023. But it was only after granting the application and the defendant called to field her witness that the Court realised the witness was not actually in Court and the learned claimant’s counsel prayed the Court to set aside the leave to defend. The Court took in the explanation for the absence of the witness and adjourned the matter for definite defence on 11th October 2023. On this date, the learned defence counsel said their witness was not in Court again because, he was allegedly not feeling fine and that; the defendant confirmed this by email and asked for adjournment. The learned claimant’s counsel opposed the application on the main grounds that, the defendant had earlier been foreclosed from defence on ground of tardiness but the case graciously reopened even though, by deceit, which the Court waived, there was no medical evidence that the witness was sick and between the 6th October 2023, when the alleged communication with the alleged witness was made and 11th October, 2023, there was no information of what transpired, while the nature of the alleged sickness was not indicated.
The learned counsel said all these could not be left to speculation and asked the Court to refuse the application and allow the claimant to adopt his FWA, which was already before he Court. The Court agreed that, the initial leave to reopen the case was actually granted on deceit and that, the alleged witness was yet not in Court. The Court added that, since the defendant was a corporation that could testify through any of her staff, there was absolutely no basis for the non-production of a witness and foreclosed the defence from defending the action the second time and, immediately called upon the claimant to adopt his FWA. The learned claimant’s counsel B.D.A ANEKE adopted the claimant’s FWA and urged the Court to find for the claimant and made adumbration to the effect that, the Court should construe relief No. XI in the light of para 42 RSD and AWSO. Thereafter, the case was adjourned for judgment on the 30th November 2023.
However, I observed at p. 224-248 of file that the learned defence counsel filed the defendant’s FWA, after the case had been adjourned for judgment on 11th October 2023, and to which my attention was drawn. That being all about summary of the proceedings, the next thing is, summary of Final Written Addresses [FWAs], to which I proceed.
SUMMARY OF THE FWAs
A: Claimant’s Theory of the Case
D.A. ANEKE franked the claimant’s theory of the case and submitted four issues for its determination:
i. Whether the claimant was liable for the failure to sell the shares upon default to sell at the point the share price dropped 15% below the offer price?
ii. Whether the continuous deduction or charges on the Account of the claimant after the defendant failed to sell upon default was lawful and in line with the agreed terms in the offer letter.
iii. Whether it was proper for the defendant to deduct and reduce the terminal benefit of the claimant as a result of the purported indebtedness arising from the default to sell the shares?
iv. Whether the claimant is entitled to a refund of all the deductions and damages?
Arguing issue 1, the learned claimant’s counsel said the law is that, parties are bound by the terms of their contracts and referred to Exhibit C21 as the contract between the parties and referred to clauses 3 & 5, which provides that, the contract shall terminate where there was change in the financial circumstances of the claimant that could adversely affect his ability to pay or he defaulted in payments while clause 5 provides that, where the share price falls below 15% of the offer price, CBG would authorise sale. The erudite counsel argued that, the convergence of these clauses was to give the defendant absolute powers to sell the shares without promptings from the claimant and that, the four blank-cheque documents obtained from the claimant, as conditions for the execution of the contract, was a confirmation of the inference. The erudite counsel argued that, the claimant’s evidence to this effect and the exhibits [C9, C11-C15, C21 & C23] tendered were uncontradicted and the fact that, the defendant charged management fees, which the claimant paid shows that, the claimant had no responsibility in the management of the facility.
The learned counsel cited the Black’s Law Dictionary 11th edition and The New International Webster’s Comprehensive Dictionary of English Language, Deluxe Encyclopedic Edition on the meanings of management and manager. The erudite counsel submitted that the incontrovertible conclusion was strengthened further when it is known that the defendant bought the shares and kept the balance in her own account inaccessible to the claimant. The learned counsel argued that in spite of the collection of the management fees, the defendant failed in her obligation to effectively manage the facilities but resorted to arm-twisting tactics to force the claimant to accept liability for the failure of the facility and referred to paras 31 & 32 of the WSO. The erudite counsel submitted too that, the effect of the irrevocable power of attorney the claimant gave the defendant was that, the claimant ceased to be in a position to order sale of the shares. Learned counsel referred to Exhibit C23, in which the defendant left some spaces blank in order to manipulate the shares as may become necessary in order to enable her sell without recourse to the claimant and backed this up with Exhibit C15, which actually gave her the absolute right to sell but, which she failed woefully to perform her obligation when it became absolutely necessary.
The erudite counsel argued that, paras 14(i) of the SF and 16(i) of the WSO showed that, the claimant entered into the contract on the basis that he could incur no liability beyond the initial contribution of N3M, even if the shares fell below 15% of the purchase price. The erudite counsel submitted that, as there could be no liability without fault, the claimant is off any liability and the defendant erred, by fixing the liability arising from her mismanagement of the facility on the claimant. Thus ended arguments on issue i. The learned counsel thereafter moved to issues ii & iii, which he argued together.
Issues ii & iii, deal with the questions of continuous deductions from the claimant’s salaries and conversion of the terminal benefits, the learned counsel argued that, the claimant had given evidence of these deductions in paras 25 & 49 of the SF making him to lose N16Million until the termination of his appointment in 2019. The learned counsel cited the termination letter [Exhibit C1]. The learned counsel argued that, whereas, the obligation on the defendant was to sell the shares upon default and, not to deduct from his account, and by these, breached the contract and cited KLM Royal Dutch Airlines v. Idehen (2017) LPELR-4375 (CA) 22, C on breach of contract. The erudite counsel argued that, if the defendant had sold the shares when it dropped below 15% of the purchase price, there would not have been any loss to both sides. The learned counsel argued that, the defendant abused her position as his employer to shift the liability to him and cited Mohammed v. Husseini (1998) LPELR-1896 (SC) 54, B on the meaning of default.
The learned counsel argued that, even up till now, the defendant has still not sold the shares but abused her position as her employer to roll over the facility, contrary to Exhibit C21, to debit the claimant without his consent. Learned counsel referred to para 26 of the WSO and submitted that the law would not allow the defendant to profit from her own wrong and cited Mekaowulu v. Ukwa West Local Govt Council (2018) LPELR-43807 (CA) 14-15, E. The learned counsel argued that, the management fees charged made the irrevocable power of attorney granted to the defendant one coupled with interest and cited paras 29 & 30 of the WSO showing that the defendant failed in her responsibilities. The learned counsel submitted that, with the uncontroverted evidence that, even up till now, the defendant failed to perform her obligations, the fact is proved that the defendant had no intention to perform her own obligations in the contract and cited Commissioner for Works Benue State & Anor v. Devcon Development Consultants Ltd & Anor (1988) LPELR-884 (SC) 23, D.
The erudite counsel submitted that, since the claimant had established breach, he is entitled to damages and cited A-Z Petroleum Products Ltd v. Suregate Integrated (Nig) Ltd (2019) LPELR-48937 (CA) 30-33, F-F as the defendant cannot unilaterally change the contract. The learned counsel cited Phenix Associates Ltd & Anor v. Hercules Maritime Ltd (2019) LPELR-47832 (CA) 14-15, F and submitted that, the defendant had no right to go beyond the 12-month tenure of the facility and therefore, the defendant unlawfully abused her power as his employer to intimidate and penalize him for the liability she solely incurred. The learned counsel submitted that the moment the defendant defaulted in her obligation to sell the shares, the claimant became entitled to full refund of all the deductions from his salaries and cited PDP & Ors v. Ezeonwuka & Anor (2017) LPELR-42563 (SC) 105, B and ended arguments on issues ii & iii and moved to issue iv.
Under issue iv, which is whether the claimant is entitled to refund of all the deductions and damages, the learned counsel cited Kpek Construction Ltd v. Ekisola (2010) LPELR-1703 (SC) to show when damages would be granted. The learned counsel argued that, the claimant pleaded and gave evidence of the oppressive conducts of the defendant by abusing her position as her employer in the contract in issue to intimidate and coerce him to submit to her demands. The learned counsel referred to paras 32-44 of the WSO and Exhibits C5, C7, C8 & C17-C19.
The learned counsel submitted that the insertion of the clause 9 – “He covenants not to institute and/or maintain any action and/or claim against the Bank before any court or any other adjudicatory or dispute resolution panel/body now or in the future” – in Exhibit C17, was a direct testimony to the oppressive conducts of the defendant as his employer. The learned counsel argued further that, the defendant swindled him by making him to believe that the negotiated facility was N8Milion whereas, the bank actually approved the N5Million, and yet debited his terminal benefits for N8Million in addition to the unlawful charges on his account and that, all these were done after failing to sell upon default as agreed.
The learned counsel argued that, the defendant, in furtherance of intimidating the claimant, transferred him to unfamiliar terrain after placing his account on debit and denied him salaries for 9 months and insisted he must accede to take the liability arising from her error. The learned counsel argued that, the above is proved when it is realised that the claimant’s employment was terminated immediately after he agreed to pay the N8Million] and cited Exhibit C1, which also showed that, the defendant neither gave notice nor paid in lieu when she terminated the claimant’s employment. The learned counsel submitted that, these also entitled the claimant to damages and cited Nig. Security Printing and Mining Plc v. Olaleye LPELR [sic] 15-27, E.
The learned counsel argued further that, Exhibits C2 & C2A, which are certificates of excellent performance issued to the claimant by the defendant are clear proof of the fact that, the only reason for termination of his employment was because, he insisted on his rights; and that, this was done further to humiliate him and take all his terminal benefits. The learned counsel cited Jombo v. P.E.F (MGT. Board) (2005) 7 KLR Pt. 202-203, p. 2441 to the effect that, the Court is the last hope of the common man and that, the reprehensible attitude of the defendant ought not to be condoned. The learned counsel argued that, the defendant saw her error and inefficiency but just abused her position as the claimant’s employer to intimidate and harass him into succumbing to the unlawful demands to accept liabilities for her failures. The erudite counsel argued that, the insertion of the clause that mortgaged the claimant’s right to go to court was the zenith of the defendant’s highhandedness.
The learned counsel argued that, this action is actually undefended, going by the provisions of Order 15, Rule 1(d) of the NIC Rules, which says, the WSOs of proposed witnesses must be frontloaded. The erudite counsel submitted that because, the defendant withdrew her original proposed witness and prayed to field another witness, whose WSO was not filed till date, the action is undefended because, the defendant was foreclosed on 14th February 2023, implying that, Order 15 was not complied with. The erudite counsel argued that, the effect is that, there was no evidence to back the defendant’s pleadings thus, meaning that, the pleadings were abandoned. The learned counsel cited Regt. Trustees BC & S v. Edet (2016) 5 NWLR (Pt. 1505) 387 at 403, F-G and that the claimant’s case was thus unchallenged and cited NRMA & FC v. Johnson (2019) 2 NWLR (Pt. 1656) AC 247 at 261, C-E. Thus ended the claimant’s FWA with exhortation to the Court to grant all the reliefs claimed.
I am aware that the defendant filed on 15th November 2023, FWA, after the matter had been adjourned for judgment on 11th October 2023. That is 35 days after the matter was adjourned for judgment and more than four months after the claimant had filed his FWA. There is no application for leave to file an address, which was not only filed out of time, but actually as an abuse of the Court’s process after the claimant had adopted his FWA and the matter had been adjourned for judgment! Going by the antecedent of the defendant and her learned counsel in this case, the FWA belatedly filed deserves no attention of the Court. Besides, to take cognisance of it is to reopen the case, since the claimant must be subsequently afforded the opportunity to file Reply on Points of Law [RPL], having filed his FWA first; and we should not forget that, in all these, I must deliver my judgment within 90 days of the adoption of the FWA, which is just 1 day around the corner now.
In the circumstances, the belatedly filed defendant’s FWA is discountenanced as an abuse of the Court’s process. The defendant should not be encouraged to continue to treat the sanctity of the Court’s business with levity and tardiness; and if she is not responsible for the crass ineptitude, she should take actions against whomever is responsible: either her staff in the legal department of the bank or her counsel, whom she could file a writ against for professional negligence in handling the matter. It is also pertinent to say the issue of multiplicity of suit is not before me, even though, pleaded in the RSD and raised under XX, as the other suit is not placed before me to decide the issue and there is no prayer regarding it.
As there is no FWA from the defendant, the next thing is to give my decision. But before then, let me make some preliminary remarks. First, I do not agree that, there is no evidence led in support of the defence because, XX is part of evidence; and the defendant did cross-examine the claimant but did not lead evidence-in-chief and, in law, has no FWA before the Court. So, the case was defended to the extent of the SD and XX, which is the reason I summarised the SD, which anchored the XX. The only thing is that, the defendant’s WSO, if any, was abandoned. And I shall give attention to the SD and XX wherever necessary.
The second preliminary remark I wished to make is that, I have painstakingly studied the case and have digested the pertinent facts, as could be seen in my summaries above. I have also carefully taken into consideration the demeanour of the lone witness-in-chief and under XX. I am aware too that, the mere fact that, this case is largely undefended, does not mean the claimant must win. I still have the burden to apply the correct position of law to the established facts of the case. I am also aware that, I did not summarise the claimant’s WSOs because, they are mere repetitions of the pleadings. Having satisfied the traditional assurances before proceeding to write a decision, I think I am home and dry to give my decision and the reasons for the decision. There I go.
COURT’S DECISION AND THE RATIONES DECIDENDI
I adopt the issues formulated by the learned claimant’s counsel but slightly reframed and condensed by fusing together issues ii & iii, to wit:
1. Did the claimant breach the contract or consent to the defendant’s unilateral alterations of the contract?
2. Are unfair labour practices established in this case?
3. If the answer to issue 1 is no, and to issue 2 is yes, is the claimant entitled to the reliefs sought?
Issue 1 dovetailed on whether the claimant was in breach of the contract or consented to the defendant’s unilateral alterations of the contract. The defendant majorly counterpleaded acquiescence, estoppel and that; clause 5 of the contract [employee loan] could only be activated on the promptings of the claimant. Thus, the defendant mainly admitted the facts of the case as pleaded by the claimant; and the law is that, what is admitted needs no further proof – COP Borno State & Anor v. Umar & Ors (2016) LPELR-40819 (CA) 2-3, F-A. In essence, the defences of acquiescence and estoppel are in the nature of admission and avoidance. In the main, what needs to be examined under issue 1 therefore is: whether the defences of acquiescence & estoppel are applicable in the instant case and, whether the defendant’s interpretation of clause 5 of the original contract is correct. In Erokwu & Anor v. Erokwu (2016) LPELR-41515 (CA) the Court of Appeal held that:
“The position of law…is that a party that puts up a defence of laches and acquiescence must establish that the party against whom those defences are set up had notice of what was being done, that he did nothing to prevent it and that the position of the opposite party was being altered to his prejudice or detriment or that he had been induced by the other party’s action to spend money. – [45, D-E]
In the case of Kayode v. Odutola (2001) 11 NWLR Pt. 725 pg. 584, the Supreme Court held that for the doctrine of laches and acquiescence to succeed, it must be established that such laches and acquiescence amount to fraud. It can only amount to fraud if the Respondent is allowed to reap where he did not sow.” – [49, A-B]
With regard to estoppel, the Court of Appeal held in Nwankwo v. Oforkansi & Ors (2016) LPELR-40170 (CA) 20-23, C-E that:
“The principle of estoppel by conduct is that where one party has, by his words or conduct, made to the other a promise or assurance which was intended to affect the legal relation between them and to be acted upon accordingly, then once the other had taken him at his word and acted upon it, then the one who gave the promise or assurance cannot afterwards be allowed to revert to the previous legal relations as if no such promise or assurance has been made by him. He must accept their legal relation as modified by himself even though it is not supported in point of law by any consideration, but only by his word or conduct…”
The effect of laches and acquiescence is estoppel by conduct and the subtle distinction between laches and acquiescence does not seem to matter in the instant scenario. Implicit in the doctrine of laches and acquiescence are that, there is knowledge on the part of the victim, there is a duty to act timely on the victim’s part, there is willful negligence to act timely and that, the victim wants to take undue advantage of the situation. The claimant pleaded and gave uncontroverted evidence that, the facility extended to him by the defendant was an employee loan to buy shares and that, the defendant exclusively managed the facility with her appointed stockbroker and that, he paid management fees. The claimant pleaded too and gave evidence that, the facility was secured against default from him, by watertight clauses of the contract, which included, deductions from his salaries for 12 months, irrevocable power of attorney to sell off the shares, clause 5 of the contract [Exhibit C21] to the effect that, the shares would be sold, once the price fell below 15% of the purchase price and that, the shares themselves were a security or collateral for the loan. He also gave evidence that, in the twelve-month duration of the contract, deductions necessary in accordance with the contract would be made on monthly basis from his monthly salaries.
The defendant did not deny all these but only pleaded that, the correct interpretation of clause 5 of the contract is different from the claimant’s interpretation of it that, the shares could be sold without the claimant’s authorisation. The defendant pleaded too that, the claimant had a duty to monitor the volatility of the prices of shares in the economy and take appropriate actions accordingly. And more importantly, the defendant pleaded that, since the claimant failed to activate clause 5 of the contract, the defendant unilaterally extended the tenure without protest from the claimant and therefore, the claimant acquiesced the unilateral alteration and, is therefore estopped from later complaint. First, let us resolve the question of the proper construction of clause 5 of the contract, which seems to be the fons et origo of the dispute. The basic principle of interpretation is that, a clause or a provision of an instrument is construed in the context of the whole instrument or other provisions as a composite whole. For the sake of clarity, the said clause 5 of Exhibit C21 [the original contract] is reproduced verbatim: “That in the case of the share price dropping to 15% below the offer price, CBG will be authorised to sell off the shares to cover the principal.”
The problem revolves around the person that would authorise the CBG to sell off the shares. The defendant said it is the claimant and, the claimant said, no, it is the defendant. To resolve this point, the question is: why was the clause inserted in the contract and, in whose favour and, for what purpose? Obviously, the reason for the inclusion of the clause is to secure the loan against market volatility. So, the clause was inserted for the benefit of the defendant and, to enable her better realise the loan, in case of market volatility without hassle. One can see that, there was provision with regard to deductions from the claimant’s salary-account for the twelve-month duration of the contract without any further monthly assurances from the claimant. This obviously is because the claimant’s salary-account pledged for the contract, was in the defendant’s custody and she deducts upfront from it, the agreed sums without further authorisation from the claimant. That is exactly the position that the defendant placed herself with regard to the power to sell off the shares, in case of adverse market volatility, by the insertion of clause 5 of the contract.
Otherwise, the logic would be that the claimant needed to give the defendant monthly authorisation before she could deduct from his salary-account. Since this was not so, the clause 5 was therefore logically meant to give the defendant self-activating right over the shares purchased with the employee loan that were not directly under her control but under the control of the stock exchange institutions, unlike the claimant’s salary-account, which was directly under her control. It would be illogical and preposterous to argue that, the claimant has to activate the clause 5 before it could be deployed by the defendant, for, the shares, being that they belong to the claimant, the claimant needs no such clause to enable him to exercise the right of ownership at any time to sell off the shares. He always has that right as the owner of the shares. Right to personally dispose of property is an incident of ownership. Therefore, it is the person who ordinarily does not have the right to dispose of the shares in law that needs clause 5 to acquire such right in the contract, which is why the defendant inserted the clause 5 in the standard form contract.
So, the defendant did not require the claimant’s authorisation to activate clause 5. To hold otherwise, is to make mincemeat of the clause 5. To cement my reasoning above, it is important to reproduce the contents of Exhibits C11 & C13 [the irrevocable authority to sell:
“IRREVOCABLE AUTHORITY TO SELL
This is to inform you that I, ANEKE LEONARD ARINZE..[sic] of OCEANIC BANK INT’L PLC..[sic] hereby give authority to BFCL Assets & Securities Ltd to sell off my shares pledged as collateral in the CSCS in the case of default on the facility without recourse to me.
Kindly accept this as my irrevocable letter of authority to sell my shares in the case of default on the terms and conditions binding the facility granted me by Oceanic Bank International Plc.
I therefore have no objection to the shares sold in the case of default without recourse to me.”
This letter was addressed to the DG Nigerian Stock Exchange. The claimant pleaded and gave evidence that, the same letter was also availed the defendant and this was not disputed and therefore needs no proof. This letter was followed up by Exhibit C12, which provides:
“IRREVOCABLE AUTHORITY TO COLLECT DANGOTE FLOUR CERTIFICATE
This is to inform you that I, ANEKE LEONARD ARINZE. [sic] of OCEANIC BANK INT’L PLC.[sic] hereby give authority to Oceanic Asset Management to collect my certificate for Dangote Flour.
Kindly release to the appointed representative of Oceanic Asset Management.”
BFCL is the stockbroker appointed by the defendant – clause 4 of the contract. Going through these documents, which speak for themselves, I do not think any doubt still exists as to the fact that, the claimant had no duty placed on him to activate clause 5 of the contract. To argue in that manner is to say the contents of all these documents construed together have no meaning or no effect. All these documents further give teeth to clause 5. In any case, that strange proposition was actually pleaded by the defence who said, these clauses and documents were just required, in the usual practice of loan transactions in banks; meaning that, they were just for formality purposes! That is laughable. The law of contract is that, parties are bound by the agreement entered voluntarily and therefore, no clause of a contract is inserted for fun – Enemchukwu v. Okoye & Anor (2016) LPELR-40027 (CA) 13, C-D. It would therefore amount to dishonesty for a party to a contract to seek to escape his obligations in the contract by pleading that a binding clause was merely inserted for formality sake.
Besides, the phrase in para 1 of Exhibit C11 & C13 to the effect that the shares could be sold “without recourse to me” [the claimant] and repeated in clause 3 thereof, puts all shades of doubt on the correct interpretation of clause 5 of the contract into shame. Therefore, the correct interpretation of cause 5 of the original contract in the context of the composite contract and relevant documents is that, the phrase “will be authorised” as used in clause 5 of the contract simply means that, the defendant and the CBG will be right to sell the shares in the event that the share price fell below 15% of the purchase price without any recourse to the claimant, and not that the claimant would have to give prior authorisation or that, the claimant had a duty to notify the defendant of the fall in price below the agreed level.
And in any case, the law in relation to a contract between an employer and an employee is that, where there is any ambiguity in the provisions of the contract, it must be resolved in favour of the employee, who is considered the weaker party in the contract. This principle was encapsulated in New Nigeria Development Company Limited v. Daniel Ugbade where the Supreme Court at p. 24, quoting the NIC in Chiroma v. Forte Oil, held: “Any ambiguity regarding the payment of any entitlement to an employee must be resolved in favour of the employee.” This is what is referred to as contra proferentem rule. This principle is also applicable to ‘standard form contracts’, as in the instant case, which is to the effect that, ambiguities must be resolved against the party that inserted or insisted on the controversial clause in the agreement and in favour of other side.
The claimant’s case is about the unilateral elongation of the contract tenure beyond the twelve-month duration and, particularly about the further deductions from his salaries and terminal benefits, to defray the self-induced loss by reason of the defendant’s failure to utilize her right in clause 5 of the contract to avoid the phantom loss. It must be noted that, immediately the price of the shares fell, even before it fell below the 15% benchmark, the claimant had already sustained loss, which he did not shift to the defendant, and for which, he, the claimant, had no buffer but bore calmly. If we recollect that the nature of the contract is that, the shares stood as security or collateral for the loan, it follows that, the only person who loses in situation of downward trends in the shares market is the claimant, while the defendant had iron-cast buffer against any loss. Therefore, the defendant had no reason whatsoever to elongate the tenure of the contract other than to take callous advantage of the claimant.
Whereas, the defendant had a buffer to secure her loss, which was the right to sell the shares once they fell below 15% of the purchase price. If she failed to sell at that point, she could not in law, equity and good conscience put the burden on the claimant, which would amount to double jeopardies for the claimant to have to bear his personal loss on the investment and yet, additionally bear the defendant’s loss, which should not arise at all in the first place because of the defendant’s right to sell timely to foreshadow the loss. It should be noted that, no consideration emanated from the defendant to the claimant, to support the unilateral elongation of the contract and the continued deductions from the claimant’s salary-account beyond the twelve-month duration of the original contract in the name of the phantom contract. It was pure fraud perpetrated by the defendant against the claimant. The claimant was even directly swindled by being made to execute the reformed contract for N8Million whereas, N5Mlioon was actually approved while his complaint on this had not been attended to till date despite the defendant’s acknowledgement! – Exhibits C3 & C4.
Since the extant defendant inherited the employee loan from the Oceanic Bank it took over and did not dispute the papers, and continued to build upon the illegality, she is deemed to assume all the liabilities, otherwise, she would have cut short the scam immediately and release the claimant of all subsequent phantom liabilities, but alas, she did not, but continued to rope the claimant into further dragnets of phantom debts. So, issue of laches and acquiescence is not applicable in the present scenario. The defendant even positively accepted her liabilities when she counterpleaded in para 9 of the SD that:
“…The defendant now Ecobank Nigeria Limited, only acquired Oceanic Bank in year 2011, and as a savvy corporate body, it has responsibility to recover all outstanding debts owe to its predecessor Oceanic Bank with all necessary legal means but without intimidation which is not their hallmark…”
There is no attempt from the claimant to defraud the defendant in any form nor would the claimant gain any undue advantage over the defendant if the terms of the contract were enforced as they are now. The defendant simply continued to fleece the claimant by constructively turning him to a compound-slave that does not deserve the wages of his labour. So, issue of laches and acquiescence does arise. Laches and acquiescence do not cover situations where fraud and illegality would be perfected, as a party cannot benefit from his wrong or unlawful acts – Nwadiaro & Ors v. The President and Members of Customary Court Ossomala (2016) LPELR-40925 (CA) 41, A-C, wherein the Court of Appeal held that:
“…a party should not be allowed to benefit from his own wrong or mala fide. It is an inverterate [sic] principle of equity that ex mala dolo non oritur actio. The Supreme Court in Green v. Green (1987) 3 NWLR (Pt. 61) 480 at 516-517 restated this principle– ‘a Court would not allow a person to profit by his wrong. A person may not create a crisis situation and turn around to plead the crisis in support of his interest.”
The defendant, no doubt deliberately created the self-induced crisis to fleece the claimant perpetually. She cannot rely on it as acquiescence and estoppel. There is no acquiescence in a situation that started in 2008 and continued without remit to 2019 when the claimant’s appointment was determined and in which 2019, the claimant filed this action, as each infraction constituted fresh cause of action and revived the others – CBN v. Amao & 2 Ors (2010) LPELR–838 (SC) 22–23, F – D and Alhasan v. Aliyu & Ors (2009) LPELR–8340 (CA) 31–32, F – G. There is equally no representation made either in words or conduct by the claimant to the defendant that made the defendant to unilaterally breach the contract and continued to deduct from the claimant’s salaries outside the contract’s duration, so, no estoppel by conduct is involved too. It was a case of pure abuse of the powers of the employer over the claimant as her employee and salaries of her employee. To accede to the defendant’s counterpleading of acquiescence and estoppel is to approve fraud and allow the defendant to profit by her wrongdoings. SS. 13 & 15 of the NICA, the living fountain of equity in labour relations that effectuate S. 254C-(1)(f) of the Constitution, would not allow this nor was it allowed under the erstwhile position of law, as demonstrated in Nwadiaro & Ors v. The President and Members of Customary Court Ossomala [supra] just quoted above.
Laches and acquiescence are based on the assumption that, there were no prior agreements between the disputing parties and a stranger just chanced on the victim’s property or right, exercising rights inconsistent with the ownership rights of the victim, to his knowledge without protest for long and until the improvement is completed, before he began to protest, with the sole aim of taking advantage of the improvements or benefits wrought by the stranger on the victim’s property or right. There is no advantage or benefits or improvements the defendant had made on the facility extended to the claimant that the victim-claimant wants now to take undue advantage of. Rather, what has happened in the instant scenario is that, the defendant serially breached the fundamental terms of the contract and thereby plunged the claimant into phantom serious disadvantages and debts and without the claimant’s consent sought and obtained at any point. Therefore, the doctrines of laches and acquiescence cannot apply where there is a contract and it is breached and the breach does not confer any advantage on the victim.
Let me state now that, there was no duty placed on the claimant to monitor the market volatility of the shares and alert the defendant about her rights in the contract. What was the work of the stockbroker retained by the defendant in the contract? What was the duty of the defendant’s department in charge of stock? In any case, the tone of the contract, when construed, is that, the defendant had a means of monitoring the market volatility of stocks and of knowing when exactly to act in her own interest, which is the reason for clause 5 in the contract and the letters of irrevocable powers of attorney to sell the shares at a jiffy without resort to the claimant. Had it been the claimant had any such duty, the contract would have so provided. You cannot read what is not in a contract into it to serve your selfish and fraudulent purposes – Access Bank Plc v. Albabaminu International Ltd & Ors (2016) LPELR-41605 (CA) 45-46, E-D.
There is also the issue that the facility was to run for 12 months, which is still part of the composite acquiescence raised against the claimant that the claimant did not protest when it was unilaterally extended and therefore acquiesced. Clause (iv) of the contract [Exhibit C21] is in view. By the nature of the defendant’s defence, it is admission and avoidance. The defendant admitted the fact that she unilaterally extended the tenure but demurred that the claimant acquiesced it. If the full context of the contract is extrapolated, it would be discerned that, the nature of the contract was such that, it could not be extended, as its extension would only mean loss to only the claimant, while the defendant would make unjustifiable gain at the expense of the claimant, whose salary had been pledged in the contract. So, selling the shares immediately they fell below 15% of the purchase price, was the only means by which the claimant’s loss could be minimized without any loss to the defendant, who would still make gain at the sale.
As explained earlier, there is no provision at all that gives the defendant right to extend the tenure. In fact, the way the contract was structured, there was watertight security that the claimant could not default in his duties in the contract because, the claimant’s salary-account was pledged in the contract and, which was under the defendant’s direct control and from which she deducted the monthly contributions upfront. Except the claimant’s appointment was terminated within the twelve-month duration, which was not the case instant, how could the claimant default, when the defendant had his salary-account under her control? And if the shares price fell below 15% of the purchase price, the defendant sells it off pronto in order not to sustain a loss.
This means that, even at that point, the defendant would still make at least, marginal profit on the sale. In effect, there was no basis, absolutely no basis, I repeat, for the elongation of the contract. So, the defendant simply audaciously breached the contract and contumaciously and criminally went ahead to continue to deduct from the claimant’s salary-account with her to service the phantom employee loan! The mere fact that the claimant had to be called for negotiations after writing series of petitions in protest of the illegalities is sufficient proof that, the claimant never gave his consent either in words or in conduct. So, there is no iota of acquiescence on the claimant’s part.
Further proof is that, the claimant’s account with the defendant was put on debit mode for 10 consecutive months such that, the claimant earned no salary at all for those 10 long months – Exhibit C20. The defendant did not counterplead this fact, as she only demurred, by pleading that, the seizure for ten month was to offset the phantom debts arising from the phantom elongated contract. I do not see how the claimant would have willingly agreed to his salaries being continually debited without protest by 2008 when the facility was illegally extended for another year. I believe the claimant’s evidence in the last sentence of para 29 of his first WSO that; being the defendant’s staff, he subtly complained to no avail. In any case, the defendant agreed at para 6 of the SD that, she unilaterally extended the contract. You cannot breach an agreement barefacedly to the injury of the other side to such extent that, he would not earn salary for ten whopping months and turn round to say he did not protest. In such situation, the protest is self-evident and needs no further proof. The defendant needs very concrete evidence that the claimant actively and positively conceded to the injurious unilateral extensions of the contract than the mere unreasonable pleading of acquiescence. A failed justification, as in this case, is vexatious, and warrants punitive damages.
It is against human nature for the claimant to act against his self-interest. The fact that the defendant was highhanded and abused her position as the claimant’s employer is proved when the defendant agreed in para 10 of the SD that, she made the claimant to earn zero salaries for 10 months by completely debiting his salaries to service the phantom employee loan! The question is: did the claimant accede to the harsh reality of not earning a salary at all for 10 months! Only a madman would have consented to such self-immolation. The defendant did not counterplead the claimant’s pleading in paras 42-43 that, a later review of the contract had a clause that barred him from seeking legal redress – para 12 of the SD – which was only removed after the claimant’s protest. The effect is admission and this proved to the hilt, the fact of the defendant’s unabashed highhandedness and breach of contract against the claimant’s active protest.
All these go to show that, all the subsequent negotiations were forced on the claimant. The facts that the claimant was starved for ten months and at the same time punitively transferred to an unfamiliar terrain simultaneously were therefore proofs that, the claimant was coerced into the unlawful negotiation as claimed. The defence that the transfer was normal cannot hold when viewed in the totality of the circumstances of the case that, the transfer fell within the period of total amortization of the claimant’s salaries for ten months. Therefore, the claimant did not agree to all the alterations to the contract. There was no reasonable reason why the claimant would agree to such unilateral acts that had no benefit in view for the claimant. It is unnatural to act against self-interest. They were forced on the claimant and therefore, invalid. And besides, the claimant’s evidence was not shaken at all under XX. I therefore give it the full premium. In that event, the claimant wins issue 1. I move to issue 2.
Issue 2 is: Did the claimant establish unfair labour practices against the defendant? To effectively answer this issue, we have to preliminarily understand some concepts because of the fact that, the concept of unfair labour practices is new in this clime and, the issue of employee loan, as a question of unfair labour practices, has been enmeshed in controversies, leading to conflicting decisions from the NIC, as reviewed by the learned author Michael Dugeri in his seminal work. I will cite just two of the cases on both divides. I cite Zenith Bank Plc v. Odeghe, wherein the NIC declined jurisdiction on a mortgage loan granted the employee by the employer in the course of employment and, which was actually pursuant to the conditions of service, because: “This court was not empowered to entertain suits relating to loans and commercial transactions…” On the other side of the divide is Akunne v. Ecobank Nigeria Plc, wherein the NIC held; contrary to its earlier decision in Zenith Bank Plc v. Odeghe [supra] that, S. 254C-(1) of the Constitution gives the NIC all-embracing exclusive civil jurisdiction on all types and any type of labour and employment relations and incidental matters and therefore:
“…the recovery of a loans and advances granted an employee while in employment, which become a debt, is one that is a matter connected with or incidental to labour and employment.”
I found that, there were grey areas that were not explored in the two cases cited above and the others cited in the erudite Dugeri’s article nor were these grey areas treated in the learned article too, which we shall look at anon. In the meantime: What is employee loan? Employee loan is a loan provided by the employer for her employees and serviced by direct periodic deductions from the employees’ emoluments on the assumption that, the employment relations would continue till the loan is fully liquidated. It needs be stressed that, this suit is not concerned with employee loan provided by a third party, with the employer’s involvement, but with the one provided directly by the defendant-employer to her employee, now claimant. So, we shall not concern ourselves with the dialectics of the polemics of employee loans by third party than the employer, which is the newest area of the emerging labour practices. Be that on the meaning of employee loan: What are unfair labour practices? S. 254C-(1)(f) of the Constitution, which introduced the concept into Nigeria, did not define it nor does any Nigerian statute. Unfair labour or trade practices are acts in employment relations, usually from the employer, against the employees, that violate employees’ rights or statutory protections in favour of employees.
These unfair labour practices include interference, restraints, and coercion of employees by employers to act against their interests, bullying, harassment, intimidation, discriminatory employment practices etc. They are such employment and labour practices that are regarded by fair-minded people as inequitable or unfair. It is the application of the reasonable man’s test or objective fairness into all aspects of employment relations, as question of law because, S. 254C-(1)(f) of the Constitution placed the dual sacred mandatory duties on the shoulders of the NIC, while adjudicating labour cases, to eschew unfair labour practices from the firmament of employment relations in Nigeria and, in their place, entrench international best practices in industrial relations in order to boost the national economy. These dual sacred constitutional mandates bestowed on the NIC must be constantly borne in mind while delineating the NIC’s jurisdiction on labour and employment matters and matters connected therewith or thereto.
I found that, the nature of the interactions between the doctrine of unfair labour practices, the NIC’s jurisdiction and employee loans are, being relatively new, generally misunderstood, which is the reason why there are conflicting decisions from the NIC itself over the issue and needs to be clarified for posterity and, particularly for us to make headway in the present case; especially that the defendant did not fully participate in the trial of this case.
In unraveling of any question of unfair labour practices in borderline cases, the important question to answer is: Would the employer have been able to commit the alleged unfair labour practices had the victim not been in the employer’s employment? Once the answer is no: the case falls squarely under the exclusive non obstante civil jurisdiction of the NIC. Thus, it is not the subject matter of the contract that determines the jurisdiction of the NIC in such occasions but the alleged unfairness of the contract [employee loan] between the employer and her employee as formed or the subsequent employer’s practices in relation to the subject matter of the employee loan, all enabled by the proximate position of the employer to the employee. Therefore, questions of unfair labour practices may arise in three distinct ways in employment relations: from the formation of the contract in issue or its implementation or both.
For example, employee loan may be made part of the employment contract: that is, a term of the contract of employment [in the employment letter] or in the conditions of service. In such cases, there is no argument that such employee loan formed part and parcel of the employment contract, as a matter of positive right, which could be enforced and litigated as incidence of the contract of employment. For this reason, Zenith Bank Plc v. Odeghe [supra] was reconsidered in principle in Akunne v. Ecobank Nigeria Plc [supra] and the NIC arrived at a contrary decision, firmly affirming the NIC’s jurisdiction on all cases of employee loans without exception, which principle has been adopted in the more recent case of Asana v. FBN Ltd, wherein Kanyip HPNICN explained the rationale thus:
“…the goal of labour law is to ensure that no employer can be allowed to impose – and no worker can be allowed to accept – conditions of work which fall below what is understood to be a decent threshold in a given society at a given time.’ The defendant should not, indeed cannot, be allowed to impose on the claimant a fait accompli – entice the claimant with an employment loan at low rate, then turn around and constructively dismiss her and convert the low rate loan to one of higher rate. Head or tail, the employer benefits much against the interest of the claimant. This cannot be.”
On the other hand, and in another aspect of the first scenario, the employee loan was not originally part of the terms of employment or conditions of service, but the way it is couched shows that, it has become a term of the contract of service or a condition of the contract of service. In that instance, there may be little or no difficulty in arriving at the conclusion that, such is purely employee loan on which only the NIC has exclusive jurisdiction. In the second scenario, employee loan may arise in the normal course of the employer’s business wherein, the employee is treated exactly like ordinary customers of the employer in terms of the contract formed but in practice, the employer used underhand methods to leverage or browbeat the employee to the employer’s whims and caprices, by the abuse of the employer’s upper-hand in the employment relations in relation to the employee loan in issue. The subsequent conduct turns the otherwise non-employee loan into employee loan on which the NIC has exclusive non obstante civil jurisdiction. And in the third scenario, the contract may partake of the features of both the first and second scenarios, whereby the employee loan contract as formed between the employer and the employee is unfair and the subsequent implementation is much more unfair.
The conducts in question in such instances are subsequent to the original employee loan, where subsequent alterations are made to the original employee loan. In such scenario, the labour court has to go beyond the contract of the employee loan as formed to examine the internal practices of the employer in relation to the management of the employee loan to find out whether the allegations of unfair labour practices are established and remedy the situation as appropriate. The NIC puts the foregoing view in better perspectives in Mariam v. University of Ilorin Teaching Hospital Management Board & Anor (2013) 35 NLLR (Pt. 103) 134-136, C-E, especially at 136, E when it held:
“…In specifically giving this Court jurisdiction over unfair labour practices, section 254C-(1) of the 1999 Constitution enjoins this Court to take a close look at labour practices of employers (even if they are internal) in order to ascertain the fairness or otherwise of those practices. And once found to be unfair, the expectation of the law is that the labour practice in question must then be remedied as may be just under the law…”
Thus, where there is evidence that the employer deducts direct or upfront from worker’s salaries to service the loan, it might be difficult to escape the conclusion that, such is purely an employee loan on which only the NIC has exclusive jurisdiction. Any quarrel that is based on payment or non-payment of salaries is by virtue of S. 254C-(1)(k) of the Constitution under the exclusive civil jurisdiction of the NIC. So, the litmus test is to look keenly into the real practices, internal or external, of the employee loan in question. It is for similar considerations that the UK Supreme Court adopted with approval, the observation and reasoning of the UK Court of Appeal that:
“Employment judges have a good knowledge of the world of work and a sense, derived from experience, of what is real there and what is window dressing.”
What the UK Supreme Court echoed above is that, the labour court or employment court must keenly examine with expert finesse the labour practices in issue, irrespective of the actual contract, to determine where they truly belong. If the NIC is denied jurisdiction simply because, on casual observation, the contract did not look like employee loan, an error to which minds untrained in labour nuances are prone, how does the nation achieve these objectives? Illustratively, the European Court of Justice [ECJ], interpreting the scope of Unfair Contract Terms Directive [UCTD] employed the same broad view of poking into the internal or actual practices of contracts, to hold that, irrespective of the fact that, the employee loan in question arose from an employer not traditionally in loan business, does not obviate the applicability of the UCTD. Vice versa, the mere fact that employee loan is given in the ordinary course of business does not obviate the applicability of the unfair labour practices for the simple reason that employment contracts are in standard form prepared by the employer.
The implication is that, where there is statutory, nay constitutional protection against unfair labour practices, the questions of unfair contract between employers and employees become unfair labour practices. The essence of UCTD is similar to the unfair labour practices anchored by S. 254C-(1)(f) of the Constitution and is based on similar considerations. S. 254C-(1)(f) of the Constitution is wide enough within its context to cover both unfair contract and unfair labour practices once both are contextualized within employment relations. Unfair labour contract is therefore an aspect of unfair labour practices.
In such scenario, it might be irrelevant that the victim actually committed a breach of the contract; the important thing is proof that the labour practice challenged was unfair, though, the question of the victim’s breach might have an impact in the objective determination of the unfairness of the labour practice being challenged. For example, where an employer dismisses an employee without fair hearing, the question of the guilt of the employee might be of little relevance in deciding the fairness of the procedure used to dismiss the employee. It follows that, even if the NIC ordinarily seems not to have jurisdiction over the contract in issue, once issue of unfair labour practices are raised and must be resolved, only the NIC has exclusive jurisdiction to determine such matters because, it is the only court exclusively vested with non obstante jurisdiction under S. 254C-(1)(f) of the Constitution to deal with questions of unfair labour practices, either by way of unfair labour contract simpliciter or subsequent unfair labour practices. NIC is the only court burdened with the sacred responsibilities to hear and determine issues of unfair labour practices and to remedy them within the context of international best practices.
These sacred responsibilities being mandatory constitutional duties imposed on the NIC and couched in non obstante clause, it follows that, once questions of unfair labour practices are raised and must be resolved in a case, they become the principal questions to resolve in the case and, all other questions become subsidiary or ancillary questions that must go along with the principal because, the non obstante mandatory jurisdictional constitutional questions supersede all other questions of jurisdiction that may appear vested in other courts. To hold otherwise would mean that, the judicature itself that has the sacred primary duty to uphold the Constitution, contemptuously breaches the non-obstante jurisdictional provisions of the Constitution! This cannot be a desirable outcome. So, where the issues of unfair labour practices are raised, jurisdiction must be ceded to the NIC for the non obstante jurisdictional provisions of S. 254C-(1)(f) of the Constitution to fulfill themselves against any other seemingly impinging jurisdictional constitutional provisions.
The law is that, where there are different courts vested with jurisdictions on different aspects of a composite case, the Court that has jurisdiction over the principal matter, is the court vested with jurisdiction over the subsidiary matters, especially where both parts of the composite case are intricately connected and cannot be divorced from each other - Turkur v. The Government of Gongola State (1989) 4 NWLR (Pt. 170) 517 and Gafar v. Government of Kwara State (2007) 4 NWLR (Pt. 1024) 375. In Gafar v. Government of Kwara State & Ors (2007) LPELR-8073 (SC) 22, A-D, the Supreme Court expatiated the issue of ancillary jurisdiction of courts thus:
“The law in this respect is also trite that where ancillary or incidental or accessory claim or claims are so inextricably tied to or bound up with the main claims before the court in a suit, a court cannot adjudicate over them where it has no jurisdiction to entertain the main claims if such incidental or ancillary claims cannot be determined without a determination at the same time of the main claims or where the determination of such incidental or ancillary claims must necessarily involve a consideration or determination of the main claims.”
The above principle was earlier anticipated and stated thus in Turkur v. Government of Taraba State (1997) LPELR-3273 (SC) 35, A-B: “The nature of a party’s action, main claim, or the fundamental issue determines, for example, which court to approach for a remedy or for reliefs…” The above principle, as established in these cases as quoted above, has been incorporated in subsections 254C-(1)(a)&(k), which provide that, all matters incidental to the causes on employment relations and causes related to payment or nonpayment of salaries, allowances and other benefits of employees shall be cognizable before this Court, to the exclusion of all other courts. In like manner, all matters connected to a main cause of unfair labour practices must come to the NIC by virtue of the non-obstante provisions of S. 254C-(1)(f) of the Constitution. The majority of the reliefs claimed in the instant case and the major grouse are all about unfair labour practices. The NIC is therefore the only court vested with exclusive civil jurisdiction over the facts of this case.
In line with the contra proferentem rule, any ambiguity in relation to whether the dispute is about employee loan or mere independent contract devoid of employment connotation, must be resolved in favour of the employee and termed employee loan in order for any vestige of unfair labour practices to be eradicated and international best practices entrenched in fulfillment of decent labour relations in Nigeria in line with the mandatory non-obstante provisions of S. 254C-(1)(f) of the Constitution. As will be shown latter in the course of this judgment, it would be evident that, any form of loan syndicated by an employer for her employee whether or not in the ordinary course of her business, comes squarely within the compass of the jurisdiction of the NIC because, unfair contract simpliciter is an aspect of unfair labour practices, once the employee loan or contract was syndicated within the context of employment relations and actively involved the employer with the loan to be defrayed from the employee’s salaries.
Therefore, wherever there is a borderline case, and the implication of denying NIC jurisdiction is that, unfair labour practices would go unremedied, that signifies that the NIC alone has exclusive civil jurisdiction on the case. That is the only option open if the non-obstante provisions of S. 254C-(1)(f)-(h) & (2) of the Constitution are not to be brushed aside unwittingly. The non-obstante provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution cannot be ignored in favour of the general jurisdiction courts because, a general jurisdiction court seems to have jurisdiction on an aspect of the composite case. Therefore, whenever there would be impossibility of fulfilling the mandatory and non-obstante provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution, were a general jurisdiction court to preside over the case, that signifies that the NIC is the court with the exclusive jurisdiction because of the non-obstante clauses of S. 254C-(1)(f)-(h)&(2) of the Constitution that subjugate the jurisdictions of all other superior courts of first instance in Nigeria to that of the NIC for the provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution to fulfill themselves. That is the essence of non obstante clause – Black’s Law Dictionary [Deluxe Ninth Ed.] 1155 on the meaning of non obstante clause.
The grouse raised in the instant case is unfair labour practices, which anchored reliefs 4,5,6,7,8,9,10,11&12. There is no way the case could be resolved without invariably determining the other issues as ancillary issues. If it could be argued with some degree of reasonability that the employee loan as formed, was out of the NIC’s jurisdiction, the moment there were allegations that the defendant went beyond the terms of the contract to deduct from the claimant-employee’s salaries and terminal benefits, the case comes briskly fully into the realm of unfair labour practices for which international best practices must be deployed to grant the appropriate reliefs, if proved and, for which only the NIC has exclusive civil jurisdiction to entertain. Only the NIC has exclusive civil jurisdiction over issues of payment or non-payment of salaries, allowances, terminal benefits or other benefits to which employees are entitled by virtue of S. 254C-(1)(k) of the Constitution. When S. 254C-(1)(k) of the Constitution is combined with S. 254C-(1)(f) of the Constitution on unfair labour practices and international best practices, it is undoubtful that NIC is the nominated court with exclusive jurisdiction over this case.
In his incisive article on the exclusivity of the NIC’s jurisdiction on the issues of employee loans, the erudite author, Michael Dugeri [supra], cited the Supreme Court’s decision in Lewis v. UBA, as impacting gravely on the legal effects of employee loans, especially as it relates to recovery of employee loans in cases of constructive dismissal and that, the NIC relied on it in its decision in Asana v. First Bank of Nigeria Ltd [supra]. The author, in reviewing the case, said the Supreme Court held that, employee loan is independent of employment contract, irrespective of the employer’s direct deductions from the employee’s salaries on account of the loan and the repayment being tied to the continued employment, in cases of dismissal before the full repayment of the loan and, the employer could proceed at all times to recoup the loan.
I wish to draw attention to the fact that, the Supreme Court’s decision in focus was not decided under the Third Alteration Act, which ushered in S. 254C-(1)(f) of the Constitution, which in turn introduced to Nigeria, for the first time, the twin doctrines of unfair labour practices and international best practices and, S. 254C-(1)(k) of the Constitution, which vests the NIC with exclusive civil jurisdiction over cases of payment or non-payment of salaries, wages, allowances and terminal benefits of employees and workers. Hence, the decision must be read in the context of the changed position of law, as effected by the Third Alteration Act - Sahara Energy Resources Ltd v. Oyebola, to the effect that, new statutes must be construed without regard at all to the old position of law. For example, because of statutory intervention, the effect of finding of unfair contract in the European Community is invalidation of the contract and its unenforceability against the victim-contracting party.
The doctrine of unfair contract being consumed by the doctrine of unfair labour practices, it follows that, the extant law is that, each case is decided on its merits and that, the labour court could hold that employee loan, in appropriate circumstances, is inseparable from the employment contract and dies with it or that, being wantonly unfair labour practice, is totally void and unenforceable. It must be noted that, wide range of reliefs are opened to the labour courts around the world and that, labour courts are not usually bound by the common law strictures but only by practical fairness comprehensible to laymen. This is encapsulated in SS. 12-19 of the National Industrial Court Act [NICA], which gives the NIC wide discretion incompatible with common law, as to the reliefs the NIC, as a labour court, could grant. SS. 12-19 of the NICA are lubricative balms to better effectuate S. 254C-(1)(f)-(h) & (2) of the Constitution. The essence of this is exampled in Asana v. FBN Ltd [supra] wherein His Lordship Kanyip J. [as He then was, now HPNICN], quoting the most eminent labour law publicist, Arturo Bronstein, explained the rationale thus:
“…the goal of labour law is to ensure that no employer can be allowed to impose – and no worker can be allowed to accept – conditions of work which fall below what is understood to be a decent threshold in a given society at a given time.’ The defendant should not, indeed cannot, be allowed to impose on the claimant a fait accompli – entice the claimant with an employment loan at low rate, then turn around and constructively dismiss her and convert the low rate loan to one of higher rate. Head or tail, the employer benefits much against the interest of the claimant. This cannot be.”
The above clearly shows the nature of NIC’s jurisdiction on unfair labour practices and the duties imposed on the NIC by the non-obstante provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution. And these clearly showed that, if the mandatory non-obstante provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution must be obeyed and, unfair labour practices positively eradicated via adjudication and replaced with international best practices, any case of employee loan must logically come exclusively to the NIC, otherwise, the provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution would atrophy. The doctrine of unfair labour practices is essentially a matter of the practices, usually of employers, against employees in relation to employee loans. Thus, what the labour court examines is, whether the employer abused her exalted position as employer to take undue advantage of the employee as a hapless victim of the rapacious practices of the employer.
Evidence of this may be sourced in the employment contract itself, as formed, wherein the employee loan is made part and parcel of the conditions of service, in which case, any unfair term of the contract becomes matters of unfair labour practices or where the employee loan is outwardly independent of the employment contract but, the repayment tied to direct upfront deductions from salary of the employee, and in practice, the employer thoroughly abused her position as employer against the hapless employee in relation to the employee loan. To get to the bottom of these in all cases, the NIC must assume jurisdiction to enable it examine whether unfair labour practices are proved. There is no other court that can do these with the present configurations of the jurisdictions of the superior courts in Nigeria.
Whatever relief the labour court would grant where it finds unfair labour practices proved, is dependent on the peculiar facts of the case and what would be fair in the circumstances, as mirrored by international best practices. Thus, the labour court might decide that the employee loan dies with the termination of employment or otherwise. It might grant compensation in addition to voiding the loan contract; and this would not amount to double compensation within the philosophy of compensatory regime in labour relations, which is normally punitive and dissuasive, especially where egregious violations of fundamental labour rights are involved. It might decide too that the loan continues irrespective of the cessation of the employment. The facts determine the outcomes.
Enough on the philosophy guiding the law, practice and procedure of employee loan and the jurisdiction of labour courts [NIC] thereto, in the instant case, the claimant proved without controversion that, the employee loan was executed in 2007 that, it was fixed for 12 months without option of renewal that, the loan was to purchase Dangote Flour shares that, the loan was secured by the shares to be purchased, as the collateral that, the defendant had all necessary enablement to end the contract within the period, if the share price fell beyond 15% of the purchase price, by selling off the shares immediately, to offset the loan granted that, the share price fell below the agreed percent within the tenure and, the defendant did not sell but instead, unilaterally extended the loan tenure.
The claimant also proved without controversion that, the defendant kept extending the loan tenure and, kept changing the terms of the contract with more onerous terms without his consent, and that, in order to be able to continue in her illegal acts, the defendant intimidated and coerced him into submission to the illegal acts and that, some of the acts are: intimidation, coercion, threat and undue influence, and could be found in: unilateral seizure of his entire salaries for ten months and, his simultaneous transfer from Anambra State to Ogoja in Cross-River State, an unfamiliar terrain and to unfamiliar schedule, in order to add to his stress to break his opposition to the defendant’s illegalities.
The claimant proved without controversion that, at a point that, the defendant prepared another contract with a clause that, he had no right to seek judicial redress, which the defendant only withdrew when he protested the clause. He tendered the document – Exhibit C17. The claimant also proved that, all these culminated in the termination of his appointment and, the further seizure of his terminal benefits, still yet, to satisfy the phantom debts created by the never-ending reformulations of the employee loan to ensure that, the claimant remained perpetually indebted to her. A contract that was supposed to terminate in 2008 stretched to 2019 – a period of about 11 years – when the claimant’s employment was terminated in connexion with the contract and his terminal benefits confiscated – Exhibit C1!
Those are the hard facts of this case and, the defendant did not effectively and positively deny any of them. It follows that, once the original contract [employee loan] as painted by the claimant above was breached in that, the defendant failed to sell the shares when it fell beyond 15% of the purchase price and its tenure was unilaterally extended by the defendant without the claimant’s prior and expressed consent, the defendant cannot escape condemnation, more particularly so, with the attempted introduction of the clause that the claimant had no right to sue. The mere attempt to smuggle in the nefarious clause into the protracted phantom employee loan shows the mens rea of the defendant and the attempted clause is the archetype of unfair contract and unfair labour practices, coercion, intimidation and undue influence. It is extremely unfair either as loan contract simpliciter or as employee loan labour practice to continually and in breach, extend and alter the tenure and terms of an employee loan entered into in 2007 and that, was supposed to end 2008, to 2019 and to continue to deduct the claimant’s salaries ad infinitum.
Without proof that the claimant defaulted within the twelve-month period of the contract, there was absolutely no basis for the illegal and fraudulent extension of the tenure beyond the twelve-month, as the employee loan was structured in an iron-cast manner to be completed within the twelve-month period, and there was no way the claimant could default in the payment of his obligations, which cumulatively would end in twelve installments, since his salary-account was under the defendant’s absolute control as his employer and from which she deducted the obligations upfront on monthly basis. And if the shares fell below 15% of the purchase price within that twelve-month timeframe, the defendant had automatic right to sell off the shares to offset any outstanding claims. Outside the twelve-month period without any default from the claimant and without the shares falling below 15% of the purchase price, the shares mature and fully become the claimant’s property without any further assurance. And even were the claimant to default within the twelve-month tenure, which was not actually the case; there was still no basis for the unilateral extension of the tenure since the remedy was to sell off the shares immediately.
Therefore, there was absolutely no ground for any extension of the tenure where the shares fell below 15% of the purchase price. In this wise, I am with the claimant that, he fulfilled all his obligations in the contract and was not obliged to monitor the volatility of the prices of shares in the stock markets, more so that, he was debited with management fee by the defendant, who retained a stockbroker to manage the stocks. I also agree with the claimant that, the irrevocable power of attorney was coupled with interest, as it was a means to secure the defendant’s right to secure her against indebtedness, since the shares were the collateral for the employee loan. And to make matters worse, the defendant seized the claimant’s entire salaries for 10 months and simultaneously transferred the claimant within the same period in order to break the claimant’s spirit and resolve not to continue with the onerous contract and still yet, terminated the claimant’s employment in connexion with the employee loan and proceeded to amortize his terminal benefits to offset the phantom indebtedness arising from the phantom and illegal employee loan.
For an employer to escape the harmer of unfair labour practices in relation to an employee loan, the terms and conditions of repayment from the employee’s salaries and the actual practices during the implementation must be objectively fair and demonstrably free of coercion and undue influence. This is because, in modern employment relations, the law presumes the employer to have upper hand, which she could leverage capriciously and highhandedly against the hapless employee. The whole essence of modern labour law is to protect workers and employees against unscrupulous employers.
It is unfair labour practice on the employee, as well as the public, who have their monies in the vaults of the banks and the overall national economy for a bank to involve in unwholesome schemes over employee loan granted to her employee, which chicanery and arm-twisting tactics involved stifling the employee’s financial muscles by brutally seizing his entire salaries for 10 months and still leaving the bruised employee to run amok working in the bank. It is like putting naked fire on a body doused with gasoline for the financially starved, hungry and angry staff to help himself to the bank’s funds in order not to starve to death. These sort of unwholesome conducts from the defendant-employer to her staff definitely encourage the financially starved, hungry and angry staff to get involved in any unwholesome scheme with the banks funds to eke out a living instead of starving to death. Thank goodness that the claimant did not succumb to the temptations and was able to leave the bank, though bruised in soul and heart, but with his head high and reputation unblemished.
It needs no pontification to know that, where such unwholesome schemes are allowed to go unchecked in the banks, the banking industry is on the verge of collapse, as you cannot starve your staff of salaries and expect them to willingly accept to die of hunger. It is totally unacceptable unfair labour practice to grant an initially innocuous employee loan to a bank staff but later manipulated out of tune to deprive the employee of the ability to live a decent life with his family. It is like someone putting fire on the thatched-roof of his home while he contentedly sleeps inside the inflamed house. Such person will burn to death and thereby endanger the houses and properties of his neighbours. It is pure madness. It is unfair labour practice the subsequent turn of events irrespective of whether the claimant was initially in breach of the employee loan or not simply because, it is inhuman and unconscionable to subject a fellow human being to a state of starvation with his family and also because, such unwholesome practices have the potential of putting the bank’s customers’ monies into jeopardy and, putting the national economy in danger, when confidence is lost in the banking industry, due to massive fraud perpetrated by hungry and angry staff.
It becomes the more-unfair contract and unfair labour practices because, the claimant herein was actually not in breach of any of the terms of the original contract to be subjected to such horrendous deprivations while the defendant was serially and continually in breach. It is even extremely unfair to the investors in the said bank whose investments would go under where the bank goes under. This Court, being a labour court, has the sacred constitutional duty, as imbued by SS. 254C-(1)(f) of the Constitution and 13-19 of the NICA, to safeguard the public interest and the national economy and as such, constantly considers the public interests in its decisions. It is because the law considers starving workers of salaries to buy the necessary of life for themselves and their families that, S. 5(7) of the Labour Act bars employers from making deductions beyond 1/3 of workers’ salaries. It is therefore abundantly clear that, the defendant originally factored S. 5(7) of the Labour Act into the original employee loan in issue, to ensure that; her employees and families are not starved to death by the complete amortization of their salaries to offset employee loans.
That is why it is totally unjustifiable to extend the contract beyond the one year because, it is clear that, the salaries of the claimant would not be able to fund any such extension, as soon as the loan and interest are compounded, which was the reason the loan was strictly designed not to last beyond a year and for the acquired shares to be sold off once the market value goes down beyond 15% of the original purchase price, in order to obviate the scenario playing out in the instant case. Since the defendant without any iota of justification deliberately created the bad scenario in the instant case, she must sink with it. What I could vividly see here in terms of the circumstances of this case is that, the claimant-employee was skillfully lured by the initial danger-free offer, which he accepted while the defendant had their game-plan intact, to eventually hoodwink the claimant into everlasting indebtedness. This is so because, at the initial stage, the claimant would have simply declined to show interest in the offer had the subsequent harsh terms made the original terms offered.
What I am trying to say is that, were these subsequent onerous terms the original terms offered at the inception of the employee loan in 2007, it would have been easy for the claimant to decline by simply not showing interest in the offer and the defendant would not have had the effrontery to force him to participate. The claimant was lured into the trap and, having entered the dragnet, the defendant continued to get him more entangled. What I could see is the design by the bank to make unmerited callous gains from her hapless staffers. The bank has simply become a criminal enterprise where bank staffers are unconscionably swindled. I believe the Central Bank of Nigeria [CBN] is not performing her supervisory functions, otherwise, these types of conducts by a bank ought not to have escaped her radar and, the bank ought to have been properly sanctioned to prevent her infectious practices from being contracted by other banks.
The subsequent unilateral alterations of the original contract therefore clearly violated S. 5(7) of the Labour Act, as these completely turned the claimant and his family into a pauper, who could not feed himself and his family. The unfair labour practice acted by the defendant in seizing the claimant’s full salaries for a whopping ten months, even criminally violated S. 3 of the Minimum Wage Act, which says, no worker or employee shall earn less than N30Thousand per month in Nigeria. That the claimant earned nothing for a whopping ten months clearly fell below the threshold of S. 3 of the Minimum Wage Act. To accede to the defendant’s pleading that, estoppel is applicable in the instant case, is to approve fraud and illegality and allow the defendant to profit from her wrongdoings.
The living equitable principle, ensconced in SS. 13 & 15 of the NICA and S. 254C-(1)(f) of the Constitution, as distinct from the ossified equitable principles received with common law into Nigeria, would not allow these to happen in the modern day employment relations regime in Nigeria. It needs to be activated here and now that, the nature of employee loans is in the nature of contracts uberrimae fidei because of the their delicate nature, which makes them easy to relapse to abuse because of the control the employers have over employees and over the salaries of the employees as a result of the loans and therefore, demands the utmost good faith from the employer in both the formulation of the contracts and their subsequent managements to escape liabilities, where disputes arise. Let us now examine the international best practices in this area of the law.
The international best practices in this area of the labour law are contained in Arts 8(1)&10 of the C095 – Protection of Wages Convention, 1949 (No. 95) [C95]. They provide thus:
“8(1) Deductions from wages shall be permitted only under conditions and to the extent prescribed by national laws or regulations or fixed by collective agreement or arbitral award.
10(1) Wages may be attached or assigned only in a manner and within limits prescribed by national laws or regulations.
10(2) Wages shall be protected against attachment or assignment to the extent deemed necessary for the maintenance of the worker and his family.”
The Report of the Committee of Experts of the ILO says these about Articles 8-10 of the C95:
“Para 247. Under the terms of Article 10, paragraph 2, of the Convention, wages must be protected against attachment or assignment to the extent deemed necessary for the maintenance of the worker and his family. In contrast, Article 8, while calling for the determination of the extent of permitted deductions, contains no explicit provision that wages shall be protected to the extent deemed necessary for the maintenance of the worker and his family. However, a similar principle that upper limit should be placed on deductions, so as to ensure that they are not so heavy as to deprive the workers of the basic minimum income needed for the maintenance of themselves and their families, is found in Paragraph 1 of the Recommendation. This provision…stipulates that ‘all necessary measures should be taken to limit deductions from wages to the extent deemed necessary to safeguard the maintenance of the worker and his family.’
Para 248. The Committee is satisfied that Article 8, paragraph 1, imposes an obligation to set limits for deductions which itself reveals an underlying concern that deductions should not become arbitrary or unreasonable. On a number of occasions, the Committee’s comments concerning the application of Article 8 are based on the understanding that limits should be placed on the aggregate of the authorised deductions to the extent necessary for the maintenance of workers and their families. The Committee therefore considers that Article 8, paragraph 1, of the Convention incorporates the idea of applying a limitation to deductions so as to ensure the maintenance of workers and their families, even though this idea is explicitly expressed only in paragraph 1 of the Recommendations.”
The report went further to trace the trajectories in a lot of countries around the world and showed that, they all put ceilings on the amount of deductions that could be made from workers’ salaries to service employee loans, though, exception of non-limit to deductions was recognised with regards to those who earned huge wages above certain ceilings, in some countries. But the bottom-line is that, the ILO prescribed that, in all cases without exceptions, upper limits be placed on the extent of deductions that could be made on the salaries of workers and that, these limits are measured by the barometer of what should be enough to take care of the worker and his family. This is in line with the decent work agenda of the ILO. Thus, the barring of deductions that would interfere with the maintenance of self and family is the minimum international best practice in this area of the law, as issued out by the world-acclaimed institution with regard to moulding and issuing out international best practices in labour relations and, Nigeria is bound by the ILO prescriptions by virtue of S. 254C-(1)(f)-(h) & (2) of the Constitution.
Nigeria ratified C95 October 17, 1960, the C95 is therefore, fully and directly applicable under S. 254C-(2) of the Constitution, while S. 5(7) of the Labour Act domesticated the international best practices. Though, I concede that Labour Act is not applicable to all categories of workers in Nigeria, but since S. 5(7) of the Labour Act is the only statutory provision on the issue, it becomes applicable to all categories of workers, as the approximate example of what the Nigerian public policy on the issue is, being that Nigeria had no option than to kowtow to the ILO C95 on the issue.
I also take this liberty to cite what obtains in some contemporary African countries. The first is the Republic of Botswana. S. 80 of the Botswana Employment Act regulates the deductions that may be lawfully made from salaries and wages of workers/employees with power to the Minister to set limits of deductions, while S. 81 provides that:
“Notwithstanding the prevision of any law to the contrary, no court shall make an order for the attachment or assignment of the wages or any other payments which may be due to an employee such as seriously to jeopardize his wellbeing or that of the dependent members of his family.”
I also take the liberty to cite the situation in Kenya. S. 19(1)(h) of the Kenyan Employment Act provides that:
“Notwithstanding section 17(1), an employer may deduct from wages of his employee–
(h) an amount due and payable by the employee under and in accordance with the terms of an agreement in writing, by way of repayment or part repayment of a loan of money made to him by the employer, not exceeding fifty percent of the wages payable to that employee after deduction of all such other amounts as may be due from him under this section…”
So serious did Botswana take the issue of deductions from the wages of workers/employees that, it even bars the courts from making any attachment order that may reduce the wages to such extent that, it interferes with the power of the worker/employee to maintain himself and the family. The Kenyan example bars any deduction that would reduce workers’ salaries beyond 50% of the net pay obviously for exactly the same reason. Both statutes were titled Employment Act, indicating very clearly that; employee loans are regarded strictly in whatever form, as incidences of employment and not as commercial contracts. And in Nigeria, by virtue of S. 254C-(1)(b) of the Constitution, only the NIC has exclusive jurisdiction to apply the provisions of any labour and employment statutes. Incidentally, SS. 16(2)&(3), 47(3), 71(2)(b)&(3) & 87(2) of the Kenyan Employment Act showed unequivocally that the Kenyan Industrial Court is the superior Court with the exclusive jurisdiction over the contents of the Kenyan Employment Act. We have seen that the international best practice is to give jurisdiction over employee loan to the industrial courts.
All in all, it is abundantly clear that, the seizure of the claimant’s entire salaries for ten whopping months in the name of fake employee loan is totally illegal and absolutely unfair labour practice, likewise the amortization of the claimant’s terminal benefits in the name of this same fake employee loan. It is in like manner that the attempted bar against the claimant to access the court is unfair labour practice, which actually violated SS. 6(6)(b) & 36(1)&(2)(b) of the Constitution: likewise, the termination of the claimant’s appointment in circumstances showing that, it was because of the fake loan. It is in the same manner that the transfer of the claimant contemporaneously with the amortization of his salary for ten months should be regarded as an instance of unfair labour practices. The intimidation, harassment and, undue-influence is proved by the attempted gagging of the claimant from accessing the courts. I agree that the claimant suffered starvation, mental and psychological anguishes along with his family, especially the pregnant wife and the children.
Apart from the proofs offered, these are inferable from the proved circumstances of the case. Issues of unfair labour practices are super abundantly established against the defendant in this case. The fake employee loan is therefore null and void and, it is hereby declared null and void and, accordingly set aside. The claimant therefore sailed to victory on issue 2. I move to issue 3, which is on the appropriate reliefs.
Issue 3: Since the answers to issues 1 & 2 are in the claimant’s favour: is the claimant entitled to the reliefs sought? From our discussions so far, there is no doubt that, the claimant won on every point raised in the pleadings and evidence before the Court. Since reliefs are the logical and natural consequences of securing victory on a case made, the claimant is entitled to all the reliefs claimed in full and, I accordingly grant all of them in full without exception because, they all have logical nexus to the facts proved in the case, but I will have to explain the grant of relief 12 further, while Relief 13, which is a post-judgment interest, is grantable under Order 47, Rule 7 of the NIC Rules and justified, because of the long number of years the deprivations took; about 11 years, which makes delay in compliance with the Court’s decision totally undesirable and the grant of interest for interest in respect of such anticipated delays highly desirable, especially in view of the inflation currently plaguing the Naira, in order to encourage the defendant to pay timeously. The Court is therefore of the opinion that, any delay in compliance with the judgment of the Court must attract sufficient dissuasive interest in order not to render the potency of the monetary awards nugatory by inflation.
In addition, the defendant is hereby ordered in line with S. 14 of the NICA to calculate her indebtedness to the claimant pursuant to reliefs 10 & 11 and pay the claimant accordingly. The mere fact that the claimant did not add them up in the reliefs should not be a defect to the reliefs, which are liquidated money demands subject to mere arithmetic calculations, distinct from special damages, which must be proved to the hilt with detailed particularisations. The Supreme Court expatiated the nature of liquidated money demand in Maja v. Samouris (2002) LPELR–1824 (SC) 21–22, where she defined liquidated sum in the following words:
“A liquidated demand is a debt or other specific sum of money usually due and payable and its amount must be already ascertained or capable of being ascertained as a mere matter of arithmetic without any other or further investigation. Whenever, therefore, the amount to which a plaintiff is entitled can be ascertained by calculation or fixed by any scale of charges or other positive data, it is said to be ‘liquidated’ or made clear...”
The Court could ordinarily order the defendant to calculate liquidated money demands and pay; more so, in view of the powers of this Court under SS. 13, 14, 15 & 16, especially 14, of the NICA and more particularly so that, the defendant admitted these deductions. A keen study of S. 15 of the NICA shows that, the equitable jurisdiction of this Court is distinct from the equity inherited with common law and received into Nigeria. The equitable jurisdiction granted this Court is living equity, as distinct from the ossified equity inherited with common law in Nigeria. This is why S. 15 says, this Court shall have and exercise equitable jurisdiction wherever: “…there was formerly or there is any conflict or variance between the rules of equity and the rules of common law…” In virtue of this, this Court can create new equitable rules/principles to override the common law in new areas not hitherto covered by the known principles of equity. Labour courts around the world have relied on provisions like this to create the radical modern regime of labour laws in tune with the ILO mandate of decent world of work. That is the purport of the present tense “is” as used in S. 15 of the NICA, as alternative to “was”, which referred to the ossified equitable principles received into Nigeria with the common law.
To do otherwise is to make the defendant make fraudulent gains at the expense of the claimant contrary to SS. 13&15 of the NICA and 254C-(1)(f) of the Constitution. Because the non obstante provisions of S. 254C-(1)(f) of the Constitution must be fulfilled, reliefs pursuant to them cannot be treated like any ordinary relief, as accommodation must be sought for them to enable the Constitution, the grundnorm, fulfill itself. Hence, any common law strictures cannot stand in the way of these reliefs and the consequential order. I now go to discuss relief 12.
Relief 12 deals with the grant of damages [compensations] for unfair labour practices and has to be properly addressed because of its uniqueness and unorthodoxy. The erudite author, Michael Dugeri [supra], talked about double jeopardies while discussing the grant of compensation in similar circumstances as this, in his incisive article. It must be known that, granting relief for unfair labour practices is an entirely new head of relief which is symmetrically efficacious of the new head of injury created in the violation of the labour rights secured in S. 254C-(1)(f) of the Constitution and for which SS. 13-19 of the NICA, especially 14 & 19(d) of the NICA, created the balms, hitherto unavailable under common law. The Court of Appeal in Sahara Energy Resources Ltd v. Oyebola [supra] recognised this when it held that:
“Section 254C-(1)(f) and (h) and (2) of the 1999 Constitution empowers the lower court to apply international best practices in labour, and conventions, treaties recommendations and protocols ratified by Nigeria. The High Court were not so empowered in exercise of jurisdiction in labour matters which culminated in the principle of the superior courts on the measure of damages…
Therefore, the innovative provisions necessarily demand a rethink of the principle in the light of changed circumstances in law…
The reference of the lower court to various Sections of the National Industrial Court Act and the Constitution was not raising an issue suo motu, but applying the law in justification of its award of general damages. It is hornbook law that a court has a duty to apply the law to the facts before it…”
The sections of the NICA in issue are SS. 13, 14, 15, & 19, which are part of the lubricative previsions for the non-obstante provisions of S. 254C-(1)(f)-(h)&(2) of the Constitution. As a matter of fact, the moment the defendant unilaterally and illegally extended the tenure of the contract and altered it without the claimant’s consent, all moneys deducted from the claimant’s salary-account and the terminal benefits became earned, which had to be refunded back to the claimant, even under the erstwhile common law orthodoxy, otherwise, the defendant would be assisted to gain from her wrongdoings, which equity forbids. So, granting the reliefs relating to the earned emoluments and further granting general damages [compensations] to remedy the unfair labour practices is not double jeopardy under the configuration of modern philosophy of labour law in Nigeria and, this is in tune with what obtains around the world, as international best practices.
Refund of illegally deducted monies from salaries and terminal benefits are earned liquidated money demands, and are not compensations. They are therefore different from compensations for injuries resulting from mental and psychological deprivations, which were not hitherto compensated or remedied under common law orthodoxy but now compensated or remedied pursuant to S. 254C-(1)(f)-(h) & (2) of the Constitution and SS. 12-19 of the NICA. Let me cite just two examples in the international circle. In Harmon v. State, reviewed in Luth Levush, “Israel: National Labor Court Quintuples Compensation in Occupational Harassment Case”, Luth Levush reported the Nazareth Regional Labour Court of Israel [RLC] thus:
“The regional court rejected the appellant’s claim for reinstatement at his job but awarded him compensation in the amount of 60,000 new Israeli shekels (NIS) (about US$17,166) ‘for harassment or compensation for mental anguish.’ The court held that there were exceptional circumstances that justified this relief even though it was not explicitly requested…Although no legislation on the topic has been adopted yet, Israeli labor courts have addressed occupational harassment within the framework of existing law, basing their decisions on the obligations of good faith and fairness to which each employer is obligated as an integral part of the employment contract.”
On appeal to the Israeli National Labour Court [NLC], equivalence of the Nigerian NIC, Levush reported that, the NLC held in September 6, 2022 that:
“[i]n our case, the employer is the State of Israel, that is, a clearly public body whose obligations of good faith and fairness are elevated…’…
The NLC concluded that the compensation to the appellant in the circumstances of the case should be set at NIS300,000 (about US$85,168), reflecting the NLC’s conviction that the circumstances of the case were particularly grave and justified significant relief. The NLC explained that the compensation was mainly for the nonpecuniary [sic] component of the case, but also took into account the economic consequences of retirement and the need to establish a deterrence to similar behaviour in the future.”
I cite the second international example. In the ILO, “Judgment 121: Twentieth Ordinary Session of the Administrative Tribunal of the League of Nations, 1968”, involving Agarwala v. United Nations Food and Agricultural Organization [FAO], the Tribunal held:
“By the letters of 8 and 9 June 1966 the complainant was relieved of his duties and in effect forbidden to call at his office. The nature of this act, which is clearly a suspension from duty, is not altered by the fact that some ten days later a duty of nominal character was proposed for him. The organization has therefore committed a breach of contract by suspending the complainant otherwise than in accordance with the Staff Regulations. Since his emoluments have been fully paid, he has suffered no material damage, but he has suffered moral damage. He is entitled to compensation for the distress caused by the abrupt way in which he was treated, tantamount in its form to summary dismissal, and for the injury done to his reputation and to his prospects of obtaining other employment. The Tribunal fixes this compensation at 6,000 dollars.”
Both cases showed that the grant of general damages [compensations] for psychological trauma like harassment, intimidation, mental torture, reputational damages etc. are the order of the day in the modern configuration of labour adjudication and does not amount to double compensation. It is worth noting that, there was no statutory provision in the Israeli statute books but the Israeli labour courts utilized the general principles of law [the doctrine of good faith and fairness in contracts] to arrive at unfair labour practices and to arrive at the award of a whopping US$85, 168 [Naira equivalence of N85, 168, 000 at N1000 to dollar] as general damages [compensations] and these were in addition to the payments of the earned entitlements of the suitor, which had been paid when he retired. It is also of note that, the suitor did not specifically ask for compensations, and yet, they were granted in both cases. In the Israeli case, the claimant had asked for reinstatement. In the second case, it is important to note that, the Tribunal of the League of Nations granted the $6,000 compensations for moral, psychological, reputational, mental agonies and damages for injured prospect of securing another job some 56 years ago in 1968! 6,000 USD in 1968 was a huge amount and even now.
Both cases showed how grievous labour courts regard psychological tortures in labour relations. It took Nigeria 43 years in 2011 to enact the Third Alteration Act to make it possible for workers and employees in Nigeria to enjoy what their counterparts had been enjoying since 56 years ago, while the judicature in Nigeria remained non-innovatively marooned to the apron of the common law. It means this international best practice had been around for about six decades now. It should also be noted that, in the second case too, the compensation was granted in addition to the earned entitlements of the suitor, which had been earlier paid.
The ILO prescribes punitive and dissuasive damages in the instances of travesty of fundamental employment tenets – Xavier Beaudonnet ed., International Labour Law and Domestic Law: A training manual for judges, lawyers and legal educators. Violations of SS. 6(6)(b), 36(1)&(2)(b) of the Constitution and, 254C-(1)(f) of the Constitution especially, are violations of fundamental labour rights in Nigeria. By virtue of the non obstante S. 254C-(1)(f) of the Constitution, the NIC is bound to give succour to balm the bruises sustained from the violations in tune with the international best practices in adjudication of labour disputes. In addition, as shown earlier on, SS. 13-19 of the NICA give the NIC ample direct statutory provisions to grant compensations or damages appropriate to remedy breaches of the rights of workers and employees to fair labour practices, as enjoined by S. 254C-(1)(f)-(h)&(2) of the Constitution.
Considering the fact that the travesty of fairness in the instant case ticked all the boxes of violations: harassment, intimidation, bully, coercion, undue influence, unfair termination, seizure of salaries for 10 months, starvation of the claimant and his family, highhandedness, mental and psychological traumas, egregious violation of the claimant’s constitutional right [SS. 6(6)(b), 36(1)&(2)(b) & 254C-(1)(f) of the Constitution] to access the courts to seek redress by the attempted bar against institution of suit, violation of the ILO C95 with regard to maximum deductions from wages/salaries and, considering that, these serial violations went on for 11 years [2008-2019], I am of the firm view, as sanctioned by the examples of international cases cited above that, the N50Million [Fifty Million Naira] claimed is even insignificant. I accordingly grant relief 12 in full. I assessed the cost of this 2019 case at N200Thousand [Two Hundred Thousand Naira only] and accordingly grant it. I equally grant relief 13, the 25% simple interest rate per annum on the monetary awards in line with Order 47, Rule 7 of the NIC Rules. The judgment takes immediate effect. I move to conclude the case, having treated all the reliefs claimed.
CONCLUSION
I reiterate that I granted all the reliefs claimed in full without exception and equally granted cost of N200Thousand and that, the judgment takes immediate effect. Since the judgment takes effect immediately, it is accordingly entered today, Wednesday the 10th day of January 2024, under my hand as the presiding judge. That ends the case.
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HON. JUSTICE Oluwakayode Ojo AROWOSEGBE
Presiding JUDGE
ENUGU DIVISION
NATIONAL INDUSTRIAL COURT OF NIGERIA
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