Confession

• Pages: 860-860

Paras. 2390-2400 Vol. 3: COMPANY LAW 860

2390. Is a company a proper plaintiff for wrong alleged against it?

“The rule is stated by Jenkins LJ. in Edwards v. Halliwell (1950) 2 All E.R. 1064 at

1066 to be: “First, the proper plaintiff in an action in respect of a wrong alleged to be

done to a company or association of persons is prima facie the company or the

association of persons itself. Secondly, where the alleged wrong is a transaction

which might be made binding on the company or association and all its members by a

simple majority of the members, no individual member of the company is allowed to

maintain an action in respect of that matter for the simple reason that, if a mere

majority of the members of the company or association is in favour of what has been

done, then cadit quaestio. No wrong had been done to the company or association

and there is nothing in respect of which anyone can sue. If, on the other hand, a

simple majority of members of the company or association is against what has been

done, then there is no valid reason why the company or association itself should not

sue.” – Per Oguntade, J.C.A. in Ejikeme v. Amaechi Suit No. CA/J/174/93; (1998)

3 N.W.L.R. (Pt. 542) 456 at 470.

2391-2400. Rule that a company is proper plaintiff for wrong against it and

rationale therefor.

“The respondents had not brought their suit in the name of the body corporate. The

respondents had not joined the Igbo community, Katsina-Ala as a party to the suit.

What had to be decided before the lower Court was who constituted the executive of

Igbo Community, Katsina-Ala. If indeed the respondents had been the person se-

lected to run the association as found by the lower Court, the conduct of the appel-

lants in refusing to allow the respondents to run the association would only amount to

an injury against the Igbo community, Katsina-Ala. Even if the lower Court had

decided that the respondent were indeed elected into the executive of the associa-

tion, there was nothing to stop or prevent the majority members of the association

from making a nonsense of the Court judgment by re-appointing the 1st defendant to

the Chairmanship of the association. It is not the duty of the Court to run the affairs

of a body corporate for the body. The principle that a Court will not take over the

management of a body corporate has crystallized into a legal doctrine described as

the rule in Foss v. Harbottle (1843) 2 Hare 461.” – Per Oguntade, J.C.A. in Ejikeme

v. Amaechi Suit No. CA/J/174/93; (1998) 3 N.W.L.R. (Pt. 542) 456 at 469.

CONFESSION

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