Where Does an Appeal from the Decision of the Investment and Securities Tribunal Lie to

CASE TITLE: AJAYI v. SEC (2023) LPELR-59729(SC)

JUDGMENT DATE: 3RD FEBRUARY, 2023

PRACTICE AREA: JURISDICTION

LEAD JUDGMENT: UWANI MUSA ABBA AJI, J.S.C.

SUMMARY OF JUDGMENT:

INTRODUCTION:

The main thrust of this appeal is the proper forum for an appeal against the decision of the Administrative Proceedings Committee of the Securities and Exchange Commission.

FACTS:

The appeal is against the judgment of the Court of Appeal, Abuja Division wherein the judgment of the trial Federal High Court was affirmed and the appeal was dismissed.

The Appellant’s case is that when he was in active service with African Petroleum PLC and as its Finance and Accounts Manager, it was alleged that he authorized the issuance of a Prospectus dated 30/3/2000 for the offer of sale of shares of 86,400,000 ordinary shares of 50k each of N28.50 per share containing an untrue statement that the total indebtedness of the Company as at 30/6/1999 was N10.2 billion whereas subsequent revelations indicated that the Company’s indebtedness was over N22 billion. That the Appellant was penalized by the Administrative Proceeding Committee (APC) of the Respondent on 19/4/2004 without serving him the Notice of hearing of the allegations against him and was not afforded the opportunity of representing himself.

The Respondent, on the other hand, narrated that the Appellant with several other principal officers of the Company was served with a hearing notice to appear before the Administrative Proceedings Committee (APC) but the Appellant failed to appear. Consequently, he was found liable and accordingly penalized.

The Appellant filed a suit at the Federal High Court, Abuja, seeking to quash the decision of the Administrative Proceeding Committee (APC). The Federal High Court declined jurisdiction and transferred the case to the Investments and Securities Tribunal (1ST). Dissatisfied with the ruling, the Appellant appealed to the Court of Appeal, which affirmed the decision of the trial Court, hence this appeal.

ISSUES FOR DETERMINATION:

The appeal was determined on a lone issue thus:

“Whether the lower Court was right to affirm that the trial Federal High Court did not have the jurisdiction to entertain the Appellant’s suit.”

DECISION/HELD:

The appeal was dismissed. Thus, the judgment of the Court of Appeal and the trial Court was affirmed.

RATIOS:

• COMPANY LAW – SECURITIES AND EXCHANGE COMMISSION: Position of the law on liability for and trial of offences relating to mis-statements in the prospectus for the offer of sale of shares under the Investment and Securities Act, 1999
• TRIBUNAL – INVESTMENTS AND SECURITIES TRIBUNAL: Whether the Investment and Securities Tribunal has the power to make the orders of certiorari and injunction
• JUDGMENT AND ORDER – ORDER OF CERTIORARI: Whether the Federal High Court can make an order of certiorari
• TRIBUNAL – INVESTMENTS AND SECURITIES TRIBUNAL: Exclusive jurisdiction of the Investments and Securities Tribunal over disputes bordering on capital market operations and investment
• TRIBUNAL – INVESTMENTS AND SECURITIES TRIBUNAL: Nature of the jurisdiction of the Investment and Securities Tribunal over the decision(s) of the Administrative Proceedings Committee of the Securities and Exchange Commission