After three adjournments, the court had scheduled a new ruling date April 27 and will give a final ruling so that the clergyman and the stockbroker will know their fate on time and take further necessary steps
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The verdict on a lawsuit which was filed against the founder of Living Faith Church (Winners' Chapel), David Oyedepo for an alleged breach of contract will be given to today, April 27.
A licensed stock brokerage firm, Valueline Securities and Investment Limited had dragged Bishop Oyedepo before aFederal High Court in Lagos for an alleged breach of agreement on a multi-billion Naira investment in theNigerian Stock Market.
The stock brokerage firm which has one Samuel Enyinnaya, as its Managing Director, in the lawsuit alleged that Oyedepo, Living Faith Church had approached the firm with an indication to make investment in the Nigerian stock market.
Other defendants in the suit which includes World Mission Agency Inc (the overall ruling organ of the church), Covenant University, David Oyedepo Foundation, Mrs Faith Abiola Oyedepo (Oyedepo’s wife), Joyce Priscillia Oyedepo, Love Jesutobi Oyedepo, David Makinde Oyedepo, Isaac Oyedepo (all Oyedepo’s children and blood relatives) and the Nigerian Stock Exchange (NSE).
The plaintiffs claimed that Bishop Oyedepo didn't meet to its own end of the bargain and caused huge losses to the investment.
After three adjournments, the court had scheduled a new ruling date April 27 and will give a final ruling so that the clergyman and the stockbroker will know their fate on time and take further necessary steps.
According to Daily Independent, the plaintiffs averred in their statement of claim that the Oyedepo and his relatives and organisations, who are the first to tenth defendants in the suit, had approached them and indicated intention to make investment in the Nigerian stock market and eventually appointed the plaintiffs as the portfolio managers of the said investments.
The plaintiffs added that an Investment Portfolio Management Agreement (IPMA) was subsequently signed between the plaintiffs and the first to tenth defendants whereby the plaintiffs were given far reaching powers to exercise discretion and use same to do everything within the ambit of the law to ensure profitability of investment and equally give periodic reports.
The plaintiffs further averred that 2.25 percent of the net asset value of the portfolio and annual incentive fee agreed at 10 percent of the returns on the investment were also agreed as part of the IPMA, after which the first to tenth defendants released N9 billion to the plaintiffs on instalment basis.
The plaintiffs added that in order to enhance profitability of the investment, the plaintiffs took some margin loans from banks in Nigeria which turned out to be very lucrative for Oyedepo and his organisations, and that periodic reports to that effect were equally submitted.
However, the plaintiffs lamented that at a point when Oyedepo wanted to buy his first private jet, World Mission Agency Inc ordered the sale of majority of the securities in the investment portfolio, and that despite professional advice to the contrary, they were made to sell the securities to raise the N3 billion needed for the jet, a development which brought about huge losses to the investment.
The sale of the securities coupled with the global economic meltdown which caused stock market in the world over to crash, according to the plaintiffs, eventually made the investment portfolio to experience more losses.
The plaintiff alleged that in a bid to avoid their financial obligations to them, Oyedepo and his organization wrote a petition to the Economic and Financial Crimes Commission (EFCC) alleging fraud and embezzlement against them.
After six years of investigation without any indictment by the EFCC, the plaintiffs alleged that Oyedepo used his “religious denominational connection” in the NSE to drag them before the NSE on the ground that their investment portfolio was mismanaged and that margin loans were taken by the plaintiffs without the consent of the first to tenth defendants.
The trial within the NSE, according to the plaintiffs, was conducted in prejudicial manner; a development they claimed necessitated the suit.
The plaintiffs, are, therefore seeking order of the court declaring that the NSE had been conducting the trial before it in a manner prejudicial to their fundamental right to fair hearing.
The plaintiffs also want the court to reverse the malicious freezing of their trading accounts which was done by the NSE.
In the breakdown of monetary compensation, the plaintiffs urged the court to compel NSE to pay them N61 million for the closure of their accounts and an order compelling the first to tenth defendants to pay them N780 million, being their unpaid professional fees for managing their investment portfolio.
In addition, the plaintiffs want N1 billion damages jointly and severally against the defendants for the trauma and psychological torture and loss of reputation occasioned to them by the actions of the defendants as well as N25 million solicitors’ fees and cost of action.
In a preliminary objection, the NSE insisted that the court lacked jurisdiction to entertain the suit as same ought to have been filed before the Investment and Securities Tribunal (IST) and not the Federal High Court.
The NSE also argued that the plaintiffs failed to file the mandatory pre-action notice before filing the suit.
During hearing, Oyedepo, through his lawyer, Chioma Okwuanyi, urged the court to discountenance the plaintiffs’ claims and to decline jurisdiction over the case, insisting that the dispute was about the fallout of a capital market transaction.
In the three-ground preliminary objection, Okwuanyi contended that by the provisions of Section 34 of the Investment and Securities Act, only the Investment and Securities Tribunal (IST) had the vested authority to entertain a dispute between a capital market operator and his client and not a Federal High Court, to which the plaintiff had brought the matter.
The lawyer argued that the plaintiffs’ suit as presently constituted before Justice Mohammed Yunusa was premature, as the plaintiff had yet to explore all the avenues laid down to resolve such a dispute before heading for the court.
“My Lord, what we are saying is that, going by the reliefs sought by the plaintiffs, they have said that this issue is a simple contract relating to investment portfolio management and our contention is that issues of simple contracts are never within the jurisdiction of the Federal High Court.
“Also, going by the Clause 14 of the Investment Management Agreement, this matter as presently constituted is premature. What clause 14 prescribed is that parties would resort to arbitration to resolve all disputes.
“My Lord, Section 251 of the constitution does not donate jurisdiction to this court in respect of capital market dispute. We therefore urge your Lordship to uphold our objection and to strike out this suit or refer the case to the Investment and Securities Tribunal or to arbitration,” Okwuanyi had submitted.
Besides, Okwuanyi claimed that the losses recorded on the investment were due to the plaintiffs’ recklessness with the margin loans purportedly obtained.
He argued that the margin loan was neither obtained with his client’s consent nor was for the purpose of the investment.
Okwanyi said: “The losses occasioned to the investment of the first to the tenth defendants were as a result of the negligence and recklessness of the plaintiffs. It was an outright fraud.
“None of the reports submitted by the plaintiffs captured the margin borrowing because they were all in their names and not in the name or on behalf of the first to the tenth defendants.”
The NSE, through its counsel, Mr. M.O. Liadi, also submitted orally during hearing that the plaintiffs ought to have approached the NSE council to ventilate their grievances rather than approach the Federal High Court.
“Given the complaints of the plaintiffs against the decision of the applicant, the plaintiffs ought to have approached the applicant’s council and if still unsatisfied, the plaintiff is obliged to proceed to the Securities and Exchange Commission (SEC).
“If still unsatisfied, by the provisions of Sections 284 and 289 of the Investment and Securities Act, the plaintiffs are permitted to proceed to the tribunal. We submit that the plaintiffs have failed to do this,” Liadi had said.
In response, the plaintiffs’ lawyer, Rickey Tarfa (SAN), urged the court to assume jurisdiction and dismiss the defendants’ preliminary objection for being irregular and for failing to comply with the court’s rules.
The much awaited ruling in the suit had suffered three adjournments, while it is hoped that the new ruling date of May 27, 2015 will be respected so that the clergyman and the stockbroker will know their fate on time and take further necessary steps.do not forget to comment, like and share.
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