THE MEASURES AN EMPLOYER CAN EXERCISE IN RESPECT OF SUSPENSION OF AN EMPLOYEE: LONGE V. F.N.B (2010)6 NWLR (PT.1189) SC.1, UNIVERSITY OF CALABAR V. ESIAGA (1999) 4 NWLR(PT.502)719
BACKGROUND:
Cases involving Employer/Employee relationship are usually not decided on the surface of it. Parties must resort to contract of employment as terms are supposed to guide the parties in determining the contract of employment except where no such contract exist or in a case of ordinary master/ Servant relationship. The essence of executing a writing contract of employment is to protect parties from untold hardship that may not have been envisaged by either of the parties to the contract. Surprisingly, Employees are always falling victim of unjustifiable termination of their employment. Sadly, we are well aware of the aged long principle that none of the willing parties should be foist on the unwilling party. In recent time, the Courts have shown that Employees are not meant to be treated as if there was no remedy in law, and that informed the attitude of the Court to setting out procedures for suspending an Employee. We shall use the case of Longe v. F.B.N[1] to illustrate the application of the rules.
LONGE V. F.B.N, AND THE PROCEEDURES FOR SUSPENDING AN EMPLOYEE:
The Appellant was appointed the Managing Director/Chief Executive Officer of the Respondent on 24/2/2000. Before that date, the Appellant had been the Respondent’s Executive Director. Following an improper loan he granted, the Appellant was on the 22/4/02 suspended by the Respondent’s Board of Directors, and on 13/6/02 his appointment was revoked. He challenged his suspension and termination of his appointment. The trial Court and Court of Appeal dismissed the Appellant suit, but the Supreme Court insisted that the procedure for suspending and terminating his appointment was not in accordance with the provisions of the Company and Allied Matters Act.
It is important to note that the Contract of employment and Employee Code of Conduct and Ethical Standard Guidelines should have been the only governing laws, but because the Appellant was a Director and the Managing Director of Respondent whose activities are mostly regulated in accordance with the provisions of CAMA. The Appellant employment was not with statutory flavour, but from the moment he was appointed a Director and subsequently, the Managing Director/Chief Executive of the Respondent. He can no longer be sacked without recourse to the provisions sections 262 and 266 CAMA.
Furthermore, the Court in Ujam v.I.M.T[2] there are three types of Employer/Employee relationship with different consequences, thus;
a) Under the Common law where, in the absence of a written contract, each party could abrogate the contract on a week’s or month’s notice or whatever the agreed period for payment of wages.
b) Where there is a written contract of employment between an Employer and Employee, in such a case the Court has a duty to determine the rights of the parties under the written contract.
c) (i) Public Servants – where their employment is provided for in a statute and/or conditions of service or arrangement.
(ii) Public Servants - as in the civil service
It is my humble view that the position of the Appellant as an Employee of the Respondent/Employer falls within the purview of paragraph C (i) above, and as such cannot be regulated or determined by the provisions of the articles of association and any other internal arrangement of the Respondent/Employer.
The Supreme Court in Longe’s case summarized and re-stated the procedure for suspension and removal of a Director of a Company as provided in sections 262 of CAMA. Thus, by virtue of section 262 of Company and Allied Matters Act, 2004
a) A Company may by ordinary resolution remove a Director before the expiration of his period of office notwithstanding anything in its articles or in any agreement between it and him.
b) A special notice shall be required of any resolution to remove a Director under the section or to appoint some other person instead of a director so removed at the meeting at which he is removed, and on receipt of the notice of an intended resolution to remove a Director under the section , the Company shall forthwith send a copy of it to the Director so concerned and the Director whether, or not he is a member of the Company, shall be entitled to be heard on the resolution at the meeting.(60-61) paragraphs H-C)
The Supreme Court per ADEKEYE, J.S.C. said at page 61, paragraph C-E;
“There is no power to remove a Director under CAMA which shall be taken as derogating from any power to remove a Director which may exist apart from this section. The power to remove a Director under the Articles of Association of the Respondent is subject to the provisions of CAMA. Obviously, the foregoing procedure from printed record was not complied with in revoking the employment of the appellant by the board of Directors of the Respondent. CAMA has removed the Appellant though a full time employee of the Respondent at the time of his dismissal from the sanction in the provision of the Employee Code of Conduct and Ethical Standard Guidelines, exhibit X under summary dismissal from the service of the bank for gross misconduct.”
Sadly, none of the defences listed under section 266 of Company and Allied Matters Act could save the Respondent as the section was not considered in removing the Appellant. The said section 266 provide thus;
a) That the Director removed was given notice of the meeting; or
b) That the person involved has ceased to be a director; or
c) That the person involved is disqualified under section 257 of Company and Allied Matters Act, 2004 from getting the notice.[3]
Interestingly, the Appellant was not given the notice of the meeting where he was purportedly suspended and subsequently removed as a director and Managing Director/Chief Executive of the Respondent by its Board of Directors. More so, paragraph C and D of section 266 CAMA do not apply to the Appellant.
Meanwhile, it was argued in favour of the Respondent that the Appellant was suspended as the Managing Director/Chief Executive of the Respondent, as such was not entitled to the notice of the meeting where he was removed as Director. It is evident that the above argument does not represent the position of the law. However, assuming but not conceding that the Appellant was rightly suspended as the Managing Director/Chief Executive of the Respondent, he was still entitled to the rights and privileges accorded to the Directors of the Respondent. The Appellant was holding dual position in the Respondent Company before he was sacked. He was a Director and at the same time, the Managing Director/Chief Executive of the Respondent. The view of the learned Justice of the Supreme Court will best illustrate the duality of the position of the Appellant in the Respondent Company, thus the Court said Per Oguntade J.S.C,
“To accept as the Court below did, that suspension of the Plaintiff would deny him the protection afforded him under section 266 is to confer the right on the defendant to vary the status of the Plaintiff without complying with the procedure laid down for doing so. The defendant cannot first suspend the Plaintiff without notice to him of the meeting at which the suspension was discussed and agreed and then turn round to say that the suspension had removed the necessity to give him the notice as mandatorily required under section 266(1) of CAMA. The Court cannot grant to a litigant the right to disobey the law under any artifice or guise. In any case, the letter of suspension to the Plaintiff did not say that he had ceased to be a Director. If it had said so, the Plaintiff would have founded his action on the letter. Rather, what the letter said was ‘During the suspension you are expected to concentrate on the recovery of the credit facility granted to the Investors Group Nig Limited. The board expects that you will do your utmost best to help in the collective efforts towards the recovery of the money.’ Its apparent that the defendant wanted the Plaintiff to use the period of his suspension primarily to pursue the recovery of the loan granted to Investors Group Nig Limited. That implies that he would do so only in his capacity as Managing Director/Chief Executive of the defendant, how could he go out to collect money for the defendant? It is my firm view that the Court below was wrong to have held that the suspension of the defendant on 22-04-02 robbed him of his status as a Director of the defendant.”
In University of Calabar v. Esiaga,[4] where incriminating materials, Vikings confraternity insignia, shot gun cartridge, and a history text book were found in the possession of the Appellant in the course of the search that led to the suspension of the Appellant. Though the Appellant shared the room with other students, but there was strong indication that those items belong to the respondent. The Appellant application for the enforcement of his fundamental human right was granted by the trial Court, but the Respondent appealed to Court of Appeal and the appeal was allowed. The Appellant then appealed to Supreme Court. The apex Court while refusing the appeal noted inter-alia;
When the University Vice Chancellor and those who administer the body with him clearly conceived or more appropriately discovered to their chagrin that a particular student or students by their mysterious activities in the campus and also being in possession of materials that did not advance the cause of academic knowledge but were more likely to cause mayhem and crisis or turbulence, should the University fold its hands and say laconically “I am tied to the decision of Garba v. University of Maiduguri”. Would the like Nero play the fiddle when the University would be engulfed in a miasma of boiling cauldron caused by people who thought and still think that a University is no longer a place for learning but a place to cause all sorts of disaffection? I think not. Would the University Authority act only when or after the institution was boiling? It is not a candle you can easily put off and easily too rekindle.
The Appellant in this case complained that he was not given fair-hearing before he was suspended citing Garba v.University of Maiduguri, but the Court distinguished between both cases and highlighted the issues the prompted the decision in Garba’s case, thus;
To what extent if any is Garba v. University of Maiduguri applicable to the present case? In Garba’s case some students were expelled by the University for riotous behaviour which involved allegation of arson, stealing and otherwise or other mayhem. An investigation body was set up by the authority under the Chairmanship of the Deputy Vice-Chancellor. The report stated that the students involved were connected to some criminal offences of arson, looting and assault. Those accused were not given opportunity of explaining their own side of the story. They were out rightly expelled. Of course, since allegations of criminal offence were made, the University based its disciplinary act of expulsion on the allegations which really meant dismissal. In Supreme Court, it was held that there was evidence of unfair hearing. In other words, the Appellants were not allowed to give their own side of the story. The supreme Court reprimanded the University for purporting to clothe itself or assume the jurisdiction of the Court to met out a punishment in a matter where committal or criminal offences was made.
More so, in Garba’s case, there was out right expulsion of the students before being heard. In the present case, an investigation body was to be set up to enable the appellant put his own side of the case. That case did not and cannot be construed that in all circumstances when the atmosphere in a University is threatened, and there is a reasonable possibility that if the rampaging act of a student or students is not nipped at the bud by the act of suspending the perpetrators of the seeming ignoble act, the University Authority should do nothing. That is not the interpretation of the decision. Furthermore, the essence of suspending the student is to abort any likelihood of the threatened disturbing atmosphere snow balling into an uncontrollable situation. The University envisaged that they would set up a body exercising administrative power where the Appellant would be given ample opportunity to clear himself by offering his own defence. He jumped the gun by going to the Court. I believe that he was trying to be clever by half. It is perhaps tempting for a student who is suspended or expelled by the a University to put himself in the garb or dress of the inimitable “Garba” in the Garba’s case, and cry blue murder for the suspension or outright expulsion.
CONCLUSION:
Fair hearing principle is a cardinal principle of law, and no Court will fold its hands and see the principle truncated on the altar of speed, or as the case may be, to achieve inordinate dreams. However, as we have seen and illustrated with various authorities, the Court will always do substantial justice to protect the interest of the concerned person. The Court will always insist that the procedures for terminating the appointment of an Employee are followed. Though each case will be treated in accordance with the nature of the Employee’s appointment.
This is a very good work learned colleague. Keep it up.
ReplyDeletegreat write up, really enjoyed it.
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