The National Insurance Commission (NAICOM), on Tuesday, before a Federal High Court sitting in Abuja, committed to stop further implementation of any programme towards recapitalization processes of the insurance and reinsurance companies in Nigeria until the determination or disposal of the suit challenging the processes.
This followed fears or apprehensions of proceeding with the recapitalization processes expressed by the plaintiffs, through their Lawyer, Ayodele Akintunde, SAN, that unless interlocutory injunction was expressly granted, NAICOM may in one way or the other be implementing the recapitalization processes before the disposal of the case pending before the court.
He cited the latest circular in respect of the recapitalization processes issued by NAICOM to all insurance and reinsurance companies last month despite the fact that the process was already being challenged in court.
But Counsel to NAICOM, Chukwuma-Machukwu Ume, SAN, allayed the fears and gave the assurance before Justice Ahmed Mohammed of the Federal High Court, Abuja, that NAICOM will not take any further step towards the recapitalization since the process is already being challenged in court.
Further, he disclosed that in order to guarantee that NAICOM will not do anything towards the recapitalization processes, he had made the NAICOM officer who signed the latest circular in respect of recapitalization cited by the plaintiff’s lawyer, to depose to an affidavit.
The presiding judge further reaffirmed the assurance that nothing would be done by NAICOM until the determination of the suit before court. The date for the continuation is yet to be fixed.
According to reports by the News Agency of Nigeria (NAN), while the Incorporated Trustees of Standard Shareholders Association of Nigeria and Mr Godwin Augustine Anono are 1st and 2nd plaintiffs respectively, NAICOM is the sole defendant in the suit.
NAICOM had, in circulars numbered: NAICOM/DPR/CIR/25/19 of May 20, 2019; NAICOM/DPR/CIR/25-02/2019 of July 23, 2019 and NAICOM/DPR/CIR/25-03/2019 of Dec. 30, 2019, directed all insurance and reinsurance companies in Nigeria to increase their minimum paid-up share capital not later than Sept. 30, 2021.
The plaintiffs, through their Lawyer, Ayodele Akintunde, SAN, had argued that the regulatory body acted without compliance with the requirements of the law, asking the court to stop the recapitalisation move.
Akintunde also argued that NAICOM’s decision was coming at a time COVID-19 pandemic had impacted negatively on not only Nigeria’s economy but the world over.
Justice Mohammed had, on Aug. 26, fixed Sept. 22 for definite hearing of the suit.
At the resumed hearing on Tuesday, Akintunde informed the court that the matter was slated for hearing of the notice of the defendant’s preliminary objection and the substantive suit.
However, Ume told the court of his intention to withdraw the preliminary objection.
The lawyer argued that “the process was filed in the heat of the order to show cause why the prayer of the applicants should not be granted which was served on us on Aug. 17.”
According to him, he “scampered” to file the preliminary objection to ensure that the prayer of the plaintiffs is not granted.
Ume explained further that he sought the withdrawal of the preliminary objection since the court ordered that the substantive matter be heard.
“Apart from the preliminary objection, we have other processes we will be asking to be struck out to make the processes before the court very neat. Those are the processes relating to order to show cause.
“They include defendant’s affidavit to show cause filed on Aug. 19, defendant’s counter affidavit of fact filed on Aug. 25, defendant’s further and better affidavit filed on Aug. 26.
“All these processes are related to show cause which are no longer necessary now.
“So we apply that since we are moving to the main matter, these processes should be struck out, including the applicants’ motion on notice,” he said.
Responding, though Akintunde raised no objection to Ume’s withdrawal of those processes, he disagreed with him on the plea for the withdrawal of applicants’ motion on notice which prayed the court for an order of interlocutory injunction.
Akintunde also noted that since the court counseled parties that we should proceed to the substantive matter, his motion on notice dated July 22 should abide with the court decision.
“However, I will withdraw my summon exparte dated July 24 and filed on the same day,” he said.
Justice Mohammed, therefore, struck out the processes sought.
The judge also held that since there was no urgency in the hearing of the matter any longer and for the fact that he was a vacation judge and the vacation would be coming to an end on Sept. 25, he ordered that the case file be sent back to the chief judge of the court for further directive, in accordance with the practice.
Akintunde, who craved the indulgence of the judge to his apprehension, said NAICOM might go ahead with the recapitalisation process if it was not stopped by the court.
According to him, my fear is based on the last circular released by the commission even when the matter is still pending.
However, NAICOM’s lawyer restated the commitment of the commission to adhere to the earlier pledge not to continue with the recapitalisation process until the suit before the court was dispensed with.
“Since we have been coming in the last three weeks, nothing has changed.
“Everything has remained. My lord, it can never happen.
“My constituency is the bar and immediately I stepped into the matter, I said everything (about recapitalisation process) ceased.
“I even insisted that a director in charge of that circular that was released deposed to an affidavit,” he said.
NAN reports that though Justice Mohammed, on Aug. 26, did not give an express order, restraining NAICOM from continuing with the recapitalisation process.
He however, cautioned that no further action should be taken by the defendant (NAICOM) until the matter was heard.
“I want to see if the defendant (NAICOM) will take further step between now and the date for definite hearing.
“I will adjourn for hearing and let me see if the defendant will overreach me.
“I don’t think they will do anything. They will not. It is a dangerous time now because the two of you now know that the matter has been fixed for hearing and any action taken will amount to interfering in the matter,” he said. -Optimum Times with additional report by NAN