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APPELLANT CASE WAS BASED ON THE POST-INCORPORATION CONTRACT

Dictum

The facts averred in the statement of claim which are deemed to be true for the purpose of the objection taken in limine show that the appellant and the 1st respondent company entered into a new contract in the terms of the preincorporation contract after the 1st respondent company had been incorporated. In the circumstance, the rule of company law that a company is not bound by a preincorporation agreement entered into by its promoters and that the company cannot ratify such agreement after its incorporation is inapplicable to the facts of the case as pleaded in the statement of claim. As the appellant alleged that his claim was founded on the post-incorporation agreement whereas the respondents said the claim was based on the preincorporation contract, the dispute cannot be resolved in limine. The issue can only be determined upon the hearing of the case on the merits.

— Bello, JSC. Edokpolo v. Sem-Edo & Ors. (1984) – SC.89/1983

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TESTIFY: ANY OFFICIAL CAN TESTIFY FOR A COMPANY

It is not necessary that it is only that person who carried out the function on behalf of the company that must testify. Not at all, as any official of the company well equipped with the transaction and or related documents would suffice to testify. – Peter-Odili JSC. Chemiron v. Stabilini (2018)

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OBJECT CLAUSES OF A COMPANY IN ITS MEMORANDUM OF ASSOCIATION

The object clauses are no more than a list of the objects the company may lawfully carry out. They are certainly not objects that the company must execute. It is fairly common knowledge that most companies in drawing up the objects clauses of the memorandum of association cover a spectrum far wider than what they can accomplish immediately. It seems to me that the inclusion of the terms of the preincorporation agreement in the memorandum of association of a company is an indication of a strong desire by the contracting shareholders that the proposed company after its incorporation should execute the terms of the agreement so included. This can be taken together with the acts of the company after incorporation in determining whether a new contract has come into existence.

— Nnamani, JSC. Edokpolo v. Sem-Edo & Ors. (1984) – SC.89/1983

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THE COMPANY CEASES TO HAVE RIGHTS WHEN A RECEIVER IS APPOINTED

The company ceases to have any right to deal with the assets. It’s right thereto is suspended. The Receiver/Manager appointed by the Debenture holder is now regarded as agent of the company for the purposes of dealing with assets in the Receivership.

– Karibi-whyte, JSC. Intercontractors v. National Provident (1988)

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ANY OFFICIAL CAN GIVE TESTIMONY FOR A COMPANY

Comet Shipp. Agencies Ltd v. Babbit Ltd (2001) FWLR (Pt. 40) 1630, (2001) 7 NWLR (Pt. 712) 442, 452 paragraph B, per Galadima JCA (as he then was ) held that: “Companies have no flesh and blood. Their existence is a mere legal abstraction. They must therefore, of necessity, act through their directors, managers and officials. Any official of a company well placed to have personal knowledge of any particular transaction in which a company is engaged can give evidence of such transaction.”

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CAMA MAKES IT POSSIBLE FOR PRE-INCORPORATION CONTRACT TO BE RATIFIED

All that has now changed in this country for section 72(1) of CAMA makes it possible for a pre-incorporation contract to be ratified by a company after its incorporation and thereby becoming bound by it and entitled to the benefit thereof. There seems to be no dispute in this appeal about this conclusion.

— Ogundare, JSC. Societe Favouriser v. Societe Generale (1997) – SC.126/1994

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FRAUD LIFTS VEIL OF INCORPORATION

One of the occasions when the veil of incorporation will be lifted is when the Company is liable for fraud as in the instant case. – Galadima JSC. Alade v. Alic (2010)

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