Jurisdiction Of The State High Court And The Investments And Securities Tribunal Vis-À-Vis Disputes Arising From The ISA

1. INTRODUCTION

It
is more than a decade since the Investments and Securities Act[i]
was enacted but the controversy surrounding the parallel jurisdiction of the
High Court of a State and the Investments and Securities Tribunal (IST) in
respect of civil matters arising from the operation and application of the ISA
appears far from settled. As a result, many legal practitioners, renowned
academics and even the courts of law have expressed different opinions on this
issue.

Perhaps
this conundrum stems from the fact that jurisdiction is the life wire of a
court and the blood that gives life to any action before a court; and
accordingly no court can adjudicate over a matter when it does not have
jurisdiction.[ii]
More so, the relevance of the State High Court and the IST to our legal system cannot
be overstated, as such necessitating a clear-cut distinction between the
jurisdiction and roles of both courts.

A
number of decisions by the superior courts seem to elect that the IST has
jurisdiction to the exclusion of all other courts in Nigeria with respect to
disputes arising from the operation of the ISA; whereas a few other decisions
of those courts are confident that the exclusive jurisdiction conferred on the
IST by the ISA cannot in anyway displace the express and far-reaching
jurisdiction conferred on the High Court of a State by the Constitution of the
Federal Republic of Nigeria, 1999.[iii]

2. JURISDICTION OF THE HIGH COURT OF
A STATE

Section
272(1) of the CFRN, 1999 (as amended) provides for the jurisdiction of the High
Court of a State and expresses that:

Subject
to the provisions of section 251 and other provisions of this Constitution, the
High Court of a State shall have jurisdiction to hear and determine any civil
proceedings in which the existence or extent of a legal right, power, duty,
liability, privilege, interest, obligation or claim is in issue or to hear and
determine any criminal proceeding involving or relating to any penalty,
forfeiture, punishment or other liability in respect of an offence committed by
any person.[iv]

The
courts have in a number of decisions qualified the jurisdiction of the High
Court of a State as “unlimited” such as in the cases of Madu v. Mbakwe[v]
and Nloga & Ors v. Bagadam & Anor.[vi]
In other decisions of the Court of Appeal and Supreme Court, this same jurisdiction
has been confirmed as only being limited by section 251 of the CFRN, 1999.
These decisions are exemplified in the cases of Society Bic S.A. & Ors v.
Charzin Industries Limited,[vii]
Ansa v. R.T.P.C.N.,[viii]
and Attorney-General, Lagos State v. Eko Hotels Limited.[ix]

Irrespective
of the trifling dissimilarities with regards to the qualification of the
jurisdiction of the High Court of a State by the superior courts, it is however
crystal clear that the Court has astronomical jurisdiction birthed from the
CFRN, 1999 with respect to civil and criminal proceedings in Nigeria.

3. JURISDICTION OF THE INVESTMENTS
AND SECURITIES TRIBUNAL (IST)

The
IST was established by section 274 of the ISA. The section reads:

There is established a body to be
known as the Investment and Securities Tribunal to exercise the jurisdiction,
powers and authority conferred on it by or under this Act.

The
jurisdiction of the IST is also expressly provided for in section 284 of the
ISA. Section 284(1) provides that:

The
Tribunal shall, to the exclusion of any other court of law or body in Nigeria,
exercise jurisdiction to hear and determine any question of law or dispute
involving; (a) a decision or determination of the Commission in the operation
and application of this Act, and in particular, relating to any dispute: (i)
between capital market operators; (ii) between capital market operators and
their clients; (iii) between an investor and a securities exchange or capital
trade point or clearing and settlement agency; (iv) between capital market
operators and self regulatory organisation. (b) the Commission and self
regulatory organization; (c) a capital market operator and the Commission; (d)
an investor and the Commission; (e) an issuer of securities and the Commission;
and (f) dispute arising from the administration, management and operating of
collective investment schemes.[x]

As
if to further cement the exclusive jurisdiction conferred on the IST, the ISA
in section 294 states that:

The
Tribunal shall have exclusive jurisdiction on matters specified in this Act.

Notwithstanding
the fact that the IST, unlike the High Court of a State, is not expressly
listed as superior court to which the judicial powers of the Federation are
vested by virtue of section 6 of the CFRN, 1999 (as amended), some judicial
authorities have stated that the Tribunal’s creation is traceable to section
6(4)(a) of the Constitution.[xi]
This position is encapsulated in the Court of Appeal decision in Wealthzone
Limited v. SEC.[xii]

4. PARALLEL JURISDICTION OF THE STATE
HIGH COURT AND THE INVESTMENTS AND SECURITIES TRIBUNAL

In
Nospetco Oil and Gas Limited v. Olurunnibe,[xiii]
the Court of Appeal in commenting on the jurisdiction of the Investments and
Securities Tribunal stated inter alia that:

There
is no doubt that to ensure speedy disposition of certain genre of cases, the
National Assembly had thought it fit to create specialist tribunal…By the
provisions of S.284(1) of the ISA, the area where the Tribunal has exclusive
jurisdiction is limited to disputes relating to powers of the Securities and
Exchange Commission vis-à-vis capital market operators and investors. S.284(1)
gives the Tribunal exclusive jurisdiction to adjudicate in disputes arising
from the administration, management and operations of a collective investment
scheme…

The
Court of Appeal in Wealthzone Limited v. SEC (supra) while remarking on the
extent of the jurisdiction of the IST vis-à-vis the Federal High Court stated
that:

The clear interpretation of the
act of the National Assembly in 1999 when it created the Investments and
Securities Tribunal as a specialist Court simply means that the exclusive
jurisdiction of the Federal High Court would no longer extend to matters
affecting the operations of the capitals and securities market, but remain
limited to matters that may arise from the provisions of BOFIA and CAMA and I
so hold.

The
aforestated dictum of the Court seems to suggest that because the National
Assembly via an Act created a specialist court with exclusive jurisdiction,
then all other courts of law including those seemingly given unlimited powers
by the CFRN, 1999 in respect of civil and criminal matters will have their
jurisdiction adjusted to conform to the ISA.

The
connotations of the decision in the Weathzone case to the extent that the IST’s
jurisdiction overrides the jurisdiction of a court created by the CFRN, 1999 in
the event that the express jurisdiction of the latter as provided for in the
Constitution conflicts with the jurisdiction of the IST as set down in the ISA
cannot be correct with due respect.

Section
1(3) of the Constitution- the grundnorm,
provides that:

If
any other law is inconsistent with the provisions of the constitution, this
constitution shall prevail, and that other law shall to the extent of the
inconsistency be void.

Therefore,
nothing that exists outside the CFRN, 1999 can purport to divest the State High
Court of its jurisdiction as expressly provide for in the Constitution.

In
fact, in deferring to the unarguable superiority of the Constitution, the ISA
in section 312(3) expressed that:

Apart
from the Constitution of the Federal Republic of Nigeria,
if the provisions of any other law, in relation to capital market matters
including the enactments specified in subsection (1) of this section, are
inconsistent with the provisions of this Act, the provisions of this Act shall
prevail and the provisions of this Act, the provisions of this Act shall
prevail and the provisions of that other law shall, to the extent of the
inconsistency, be void.[xiv]

The
court in reiterating a trite position of the law held in Stabilini v. FBR[xv]
that:

Where
the Constitution of the Federal Republic of Nigeria has vested jurisdiction in
a court of law, it cannot be lightly divested. Where it is intended to be
divested it must be done by clear, express and unambiguous words, and by a
competent amendment of the Constitution. Thus the courts do frown at any
attempt to erode or relegate the power of the court and or the supremacy of the
Constitution…[xvi]

More so, the Court of Appeal in
commenting on the jurisdiction of the High Court of the Federal Capital Territory
(which is equivalent to the High Court of a State) vis-à-vis the provisions of
the ISA that purport to limit the jurisdiction of the High Court as conferred
by the Constitution in Davandy Finance and Securities Limited & Ors v. Aki
& Ors[xvii]stated
inter alia that:

The
jurisdiction of the High Court of the Federal Capital Territory Abuja is set
out in section 257(1) of the Constitution of the Federal Republic of Nigeria,
1999 (as amended). It provides as follow. “Subject to the provision of section
251 and any other provision of this Constitution and in addition to such other
jurisdiction as may be conferred upon it by law, the High Court of the Federal
Capital Territory, Abuja shall have jurisdiction to hear and determine civil
proceedings in which the existence or extent of a legal right, power, duty,
liability, privilege, interest, obligation or claim is in issue…” Thus the High
Court of the Federal Capita Territory, Abuja, is a court of unlimited
jurisdiction subject to any limitation imposed upon it by section 251 of the
Constitution or any other provision thereof… It cannot be taken away by section
284(1) of the Investments and Securities Act, 2007, which is inferior to the
Constitution of Nigeria, 1999.

Luckily
this issue was taken head-on and elaborately addressed in the case of Value Line
Securities Investment Ltd v. Anakwube[xviii]
wherein the Court of Appeal held assuredly that:

The State High Court equally has
jurisdiction to entertain any dispute covered by or arising under the
Investment and Securities Act including a dispute between a capital market
operator and its client like the dispute in the present case, by virtue of the
unlimited jurisdiction of the State High Court to hear and determine any civil
or criminal proceeding vested on it by Section 236(1) of the 1979 Constitution
of Nigeria, applicable when the cause of action arose and Section 272 of the
1999 Constitution of Nigeria, applicable when the suit was filed and up to
date.

The
Court in Anakwube’s case even went further to declare S.242 of the Investment
and Securities Act[xix]
which purported to oust the jurisdiction of the High Court of a State to
entertain matters covered by the ISA, as being void to the extent of its
inconsistency with the Constitution. The Court also held that:

As
it is, the State High Court and the Investment and Securities Tribunal have
concurrent jurisdiction to entertain cases involving disputes covered by or
arising from the Investment and Securities Act.

5. CONCLUSION

It
is true that the IST has jurisdiction to entertain all civil matters that may
arise from the operation and application of ISA but the preponderance of
authorities suggest strongly that its jurisdiction, though labelled “exclusive”
cannot in anyway divest the perceived unlimited jurisdiction of the High Court
of a State to also entertain all matters that may arise from the application of
the ISA.

Without
any doubt, both the IST and the State High Courts have equal and concurrent
jurisdiction with respect to the ISA and all the relevant portions of the ISA
that exist to divest all courts of the jurisdiction to entertain matters that
arise from the operation of the ISA cannot apply to the High Court of a State
as the latter’s jurisdiction is deeply rooted in the Constitution. It goes
without saying that where there are conflicts between the provisions of the ISA
and the Constitution, all those conflicts or inconsistencies must be resolved
against the ISA.

* LL.B (Nig.); B.L. Email: Henrycugwu@gmail.com

[i] Investments
and Securities Act, 2007 (Hereafter, ISA).

[ii] See
Dangana v. Usman (2013) 6 NWLR (Pt. 1349) 50.

[iii] Cap.
C23, Laws of the Federation of Nigeria, 2004 (Hereafter, CFRN, 1999).

[iv] See
section 257(1) CFRN, 1999 (as amended) for the equivalent provision as it
relates to the High Court of the Federal Capital Territory. See also
Mailantarki V. Tongo & Ors (2017) LPELR-42467 (SC).

[v] (2008)
10 NWLR (Pt. 1095) 293.

[vi] (2009)
LPELR-8762 (CA).

[vii] (2014)
LPELR-22256 (SC).

[viii] (2008)
7 NWLR (Pt. 1086) 421.

[ix] (2008)
All FWLR (Pt. 398) 235.

[x] See SEC
v. Kasunmu (2009) 10 NWLR (Pt. 1150) 509.

[xi] See
generally section 6(1)-(5) CFRN, 1999 (as amended).

[xii] (2016)
LPELR-41808 (CA).

[xiii] (2012)
10 NWLR (Pt. 1307) 115 @ 161.

[xiv] See
generally, section 312 of the ISA, 2007.

[xv] (2009)
13 NWLR (Pt. 1157) 226.

[xvi] The
decisions in Ngige & Anor v. INEC & Ors (2014) LPELR-25413 (CA);
Obayuwana v. Governor, Bendel State & Anor (1982) LPELR-2160 (SC); N.U.E.E.
v. B.P.E. (2010) All FWLR (Pt.525) 201; and National Union of Electricity
Employees & Anor v. Bureau of Public Enterprises (2010) LPELR-1966 (SC)
also epitomize this axiomatic principle of law.

[xvii] (2015)
LPELR-24495 (CA) per Ekanem, J.C.A., (Pp.20-22, paras. G-A).

[xviii]
(2015) LPELR-24486 (CA) per Agim J.C.A., (Pp. 25-33, paras.A-A).

[xix] Investments
and Securities Act, No. 45, 1999. This Act was repealed by the ISA, 2007. See
section 314(1) of the ISA, 2007.

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