The background material to this appeal is that the plaintiffs/appellants sued the defendants in the Federal High Court, Lagos Division, claiming against them the following reliefs:-
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1
A declaration that the document, copies of which were lodged with the Registrar of Companies and the Federal Inland Revenue Department, to which the 1st and 2nd Plaintiffs were subscribers, is the only true memorandum and articles of associates of the Albion Construction Co. Ltd.
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2
An injunction restraining the 1st, 2nd and 3rd defendants and/or any person acting with or on their direction or authority from conducting the affairs of the Albion Construction Co. Ltd. and/or particular from operating the accounts of the said company in any bank whatsoever on the basis of any memorandum and article of association other than that mentioned in paragraph (3) hereof.
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3
A declaration that the 1st and 2nd Plaintiffs are the only lawful directors of the Albion Construction Co. Ltd.
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4
A declaration that the purported appointment of the 1st and 2nd defendant as directors of the Albion Construction Co. Ltd. whether pursuant to the memorandum and articles of association of the said company or at the meeting of the Board of Directors of the Company held on 7/2/80 is illegal, null and void and of no effect
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5
A declaration that the claim of the 1st and 2nd defendants to be owners of 40.000 shares each in the Albion Construction Co. Ltd whether as subscribers to the memorandum and articles of association or pursuant to resolution allegedly passed at a meeting of the Company's Board of Directors held on 5/5/81 is unlawful and not maintainable in law or in fact.
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6
A declaration that all shares held by the 3rd defendant in the Albion Construction Co. Ltd. were held by him in trust for the 1st Plaintiff and an order directing the said defendants from holding themselves out as directors of the 3rd plaintiff company or from giving directions concerning the management and control of the said company unless and until duly appointed as directors company.
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7
An injunction restraining the 1st and 2nd defendants from holding themselves out as directors of the 3rd plaintiff company or from giving directions concerning the management and control of the said company unless and until duly appointed as directors of the said company."
After hearing the parties and their witnesses and counsel, the learned trial Judge, Odunowo, J., granted the claims of the plaintiffs and made the following declarations :-
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1
"The document described as Memorandum and Articles of Association of Albio Construction Company Limited dated 16/9/76 and admitted in evidence in this motion as Exhibit A to which the first and second plaintiffs were subscribers is the only true Memorandum and Articles of Association of the third plaintiff company.
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2
The nominal share capital of the third plaintiff company is N200,000 divided into 200,000 shares of Nl.OO each and not 500,000 as alleged by the defendants.
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3
All the parties to this action are shareholders of the third plaintiff company namely (1) Chief R. A. Okoya - 50 per cent or 100,000 shares; (2) Mrs. K. Okoya - 1 percent or 2,000 shares;(3) Mr.S. Santilli - 20 percent or 40,000 shares; (4) Mr. a.Davanzo-20 percent or 40,000 shares; and (5) Prince D. A. Ademiluyi 9 percent or 18,000 shares.
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4
The third defendant is hereby directed to execute an instrument of transfer in respect of 51 percent or 102,000 shares which he holds on trust, in favour of the first plaintiff.
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5
The first second and third defendants and/or any other person or persons acting with or on their direction or authority are hereby restrained from conducting the affairs of the third plaintiff company and in particular from operating the account of the said company in any bank whatsoever on the basis of any Memorandum and Articles of Association other than that mentioned in paragraph (1) above
The defendants/respondents herein appealed to the Court of Appeal against the said judgment of Odunowo, J. Pending the determination of that appeal, they applied to Odunowo, J. for stay of execution of his orders. The learned trial Judge after due consideration of the application dismissed it, except for the following order contained in that part of the ruling where he said:
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"Just before the motion was moved, Chief Williams, S.A.N conceded that the order directing the 3rd defendant to execute an instrument of transfer in respect of 51 percent or 102,000 shares which he holds on trust for the plaintiff could be stayed without rejudice to the operation of all the remaining declaration by the court, including the declaration as to the number of shares owned by the 1st and 2nd defendants in the company."
The defendants/respondents made a similar application to the Court of Appeal for stay of execution of the orders made by Odunowo, J., seeking the following reliefs:-
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1
"An order of this Honourable Court staying further proceedings on the declarations as contained in the judgment of Hon. Justice T. A. Odunowo of the Federal High Court, Lagos,
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2
An order staying execution of the orders contained in the same Judgment given on the 15th day of December. 1988 pending the determination of the appeal lodged by the Defendants/Appellants/ Applicants to this court;
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3
And for such further order or other orders as this Honourable Court may deem fit to make in the circumstances."
There was an objection by the counsel for the plaintiffs by way of a Notice of Preliminary Objection dated 20/3/89 to this application in the following terms :-
"NOTICE OF PRELIMINAR Y OBJECTION
TAKE NOTICE that at the hearing of the motion on Notice herein dated the 2nd day of March, 1989 the above-named Plaintiffs intend to raise the following preliminary objections:-
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i
The prayer for "staying further proceedings on the declarations as contained in the judgment" is not a relief known to the law.
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ii
No such prayer was ever moved in the court below and so it cannot be moved in this court.
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iii
The prayer for staying execution of the orders contained in the judgment" is incompetent and untenable as there is nothing left to stay.
Ruling on the preliminary objection, the Court of Appeal, as per the lead ruling of Akpata J.C.A. in which the other Justices on the panel concurred held as follows:-
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“I agree with Chief Williams that the application for an order staying further proceedings on the declarations as contained it the judgment of Hon. Justice T. A. Odunowo the Federal High Court, Lagos was not made in the court below. Besides, the nature of future proceedings is not clear.... No such special circumstances have been shown to exist. The first prayer is therefore incompetent. It is struck out. The objection against the application for an order staying the execution of the orders contained in the judgement of Odunowo, J., delivered on 15th day of December, 1988 fails. It is dismissed".
The effect of this ruling is that what was left of the defendants' application of 2/3/89 was the second leg of the application named an order staying execution of the orders contained in the judgment of Odunowo, J., of the Federal High Court, Lagos Division of 15/12/88 pending the determination of defendants' appeal against the judgment.
The application was then heard by the court of appeal differently constituted and then went on to grant the application for stay of execution and inter alia appointed a board of Receivers and Managers to conduct the affairs of the company pending the determination of the appeal. Against that ruling, the plaintiffs appealed to the Supreme Court.
