ADEKOLA MUSTAPHA V. CORPORATE AFFAIRS COMMISSION (2019)

Background

This appeal concerned the competence of an action commenced by a legal practitioner against the Corporate Affairs Commission (CAC) in relation to the rejection of proposed company names. The appellant, Adekola Mustapha, had presented three proposed names to the respondent for reservation and registration. The names included A. A. Investment Nigeria Limited, A. A. Concerns Limited and Blue Sea Resources Limited. The CAC refused to accept or reserve the names because, in its view, they were identical or sufficiently similar to names of companies already registered. The refusal was based on the statutory prohibition against the registration of names capable of misleading or confusing the public, including section 32 of the Companies and Allied Matters Act 1990.

The appellant challenged the administrative decision by commencing proceedings at the Federal High Court, Abuja, seeking an order of certiorari to quash the Registrar-General’s decision and an order compelling the CAC to accept and reserve the names. The record showed, however, that the appellant was not the promoter or intended beneficiary of the proposed companies. He was acting as counsel to the persons who had instructed his law firm to make the relevant applications. The clients or promoters were not joined as parties, and the appellant did not demonstrate that he had a personal proprietary interest in the proposed names or express authority to sue in his own name.

The Federal High Court dismissed the claim on 25 May 2004. The Court of Appeal, Abuja Division, affirmed that decision on 18 December 2008. The appellant appealed to the Supreme Court. At the hearing, the CAC raised a preliminary objection, arguing principally that the appellant lacked locus standi to institute the original action or maintain the appeal. It also contended that one of the grounds of appeal was a ground of fact or mixed law and fact filed without the required leave. The Supreme Court first addressed the question of standing.

Issues

1. Whether the appellant, who was counsel to the promoters of the proposed companies, had locus standi to institute the action in his personal name.
2. Whether a legal practitioner may commence proceedings in his own name on behalf of a client without showing a personal interest or authority to sue in that manner.
3. Whether the alleged interest of counsel in the professional fees payable by the clients was sufficient to confer standing.
4. Whether the preliminary objection should succeed and, if so, the effect of the appellant’s lack of competence on the jurisdiction of the courts.

Ratio Decidendi

The Supreme Court held that locus standi means the legal capacity or standing of a person to maintain an action and to request adjudication of a particular dispute. A person without locus standi has no right to appear or be heard in the proceedings. The issue is not whether the subject matter is justiciable, but whether the particular claimant is the proper person to seek relief in respect of it.

The court emphasised that standing is a threshold issue, comparable in importance to jurisdiction, and should be determined at the earliest opportunity. The appropriate processes for deciding the issue are the plaintiff’s statement of claim or, where the action is commenced by originating summons or motion, the affidavit supporting the originating process. Those processes define the claimant’s cause of action and disclose whether the claimant has an enforceable interest in the subject matter.

Applying those principles, the court found that the appellant was merely counsel to the promoters of the proposed business names. The promoters, rather than the appellant, were the persons who required the names and who would benefit from their reservation or registration. The appellant had not shown that the CAC’s refusal infringed any personal legal right of his. His possible entitlement to professional fees, or the possibility that he might lose the clients’ brief, did not create the substantive interest required for standing.

The court further held that a legal practitioner’s professional duty to represent a client does not authorise the practitioner to take over the client’s cause and commence proceedings in the practitioner’s own personal name. Counsel is engaged to act for the client, whose interest lies in the subject matter, while counsel’s interest ordinarily consists only of the agreed or expected professional remuneration. That financial interest does not make counsel a party to the dispute.

The court also reaffirmed the rule that an agent or donee of a power of attorney must sue in the name of the principal or donor when presenting an action pursuant to the agency. Even if the appellant had possessed a power of attorney, he could not have instituted the action in his own name merely by virtue of that authority. The proper claimant was the client or promoter whose rights and interests were directly affected by the CAC’s refusal.

Court Findings

The Supreme Court concluded that the documents filed by the appellant himself established that he acted as counsel to undisclosed clients. The supporting affidavits and statement filed in support of the application for leave expressly referred to the clients’ dissatisfaction with the CAC’s decision and to their instruction to the appellant to commence proceedings. Those facts contradicted the suggestion that the appellant was acting to protect a personal right.

Because the appellant lacked locus standi, the action filed at the Federal High Court was incompetent. The trial court therefore lacked jurisdiction to entertain it, and the judgment delivered in the incompetent action was treated as a nullity. Consequently, the appellate courts had no jurisdiction to entertain an appeal arising from that judgment. The first limb of the preliminary objection succeeded, making it unnecessary for the Supreme Court to consider the second limb concerning the competence of the second ground of appeal and the requirement for leave.

Conclusion

The Supreme Court dismissed the appeal and struck out Suit No. FHC/ABJ/M/365/2002 as incompetent. The court awarded costs of N500,000 against the appellant in favour of the Corporate Affairs Commission. The other members of the panel—Rhodes-Vivour, Ariwoola, Nweze and Galumje JJSC—agreed with the lead judgment and endorsed the consequential orders.

Significance

The decision is important for civil procedure and legal practice in Nigeria because it clearly separates the role of counsel from the legal rights of a client. A lawyer’s professional involvement, expectation of fees or concern about losing a brief does not confer standing to litigate a client’s substantive claim in the lawyer’s personal name. The person whose enforceable right is affected must ordinarily be the claimant. Where representation is based on agency or a power of attorney, the agent must sue in the name of the principal unless an independent legal right or interest of the agent is established. The case also confirms that locus standi is a preliminary jurisdictional question that may be raised at any stage and that an action commenced by a person without standing may invalidate the proceedings from inception.