1. Introduction
Winding-up actions are sui generis proceedings2 governed by their own specialised set of rules known as the Companies Winding-Up Rules 2001 ("the Winding-Up Rules") as well as some provisions of the Companies and Allied Matters Act 2020 (the "Act"), and in cases where the Rules are lacking, the Federal High Court (Civil Procedure) Rules.3
2. A Cursory Examination of Rule 4 of the Winding-Up Rules
A key provision of the Winding-Up Rules stipulated in Rule 4 thereof expressly prohibits ex-parte applications in winding-up proceedings by stipulating that every application in a winding-up action shall be by motion on notice.4 It provides thus:
Every application in Court other than a petition shall be made by motion, notice of which shall be served on every person against whom an order is sought not less than five clear days before the day named in the notice for hearing the motion. [Emphasis added]
By the tenor of Rule 4 of the Winding-Up Rules, particularly the usage of the word "shall," it is clear that the Rule mandates the service of every application on the
respondent(s) and any deviation from the rule would be enough to vitiate the proceedings.5 In the case of Argiji Properties Ltd v. Birni & Anor.,6 per Hassan JCA pronounced on the effect of failure to comply with the provisions Rule 4 of the Winding-Up Rules on the jurisdiction of an adjudicating court:
... In other words, in a petition for winding up of a company, save for the petition itself, any application filed before the Court in the proceedings shall be by motion on notice to the respondent and served on the respondent not less than five (5) days before the hearing of the motion by the Court. It goes without saying that the provision is clear, unequivocal and bereft of any ambiguity and it affords no discretion on the part of the applicant. Where, as in the instant case, the provision of Rule 4 was not complied with, the application ex-parte is not only incompetent, the Court lacks the requisite jurisdiction to hear, determine and grant the reliefs sought as per the application filed in default of Rule 4 of the Companies winding up Rules... Every Court has jurisdiction to enquire into whether it has jurisdiction over any matter or not, and if it finds that it does not have the requisite jurisdiction, it takes its hands off, and the matter ends there, because where a Court has no jurisdiction, the juridical basis for the exercise of power over such matter is absent... In the instant case, Rule 4 of the Winding Up Rules, 2001 provides for application of this nature to be on notice. But the respondents brought the application ex-parte which is in contravention of Rules 4 of the Winding Up Rules, having not been initiated with due process of law which rendered the ex-parte motion incompetent and the ruling delivered by the Court granting the order ex-parte is null and void with no effect - Madukolu Vs Nkemdilim (supra). The trial Court erred when it held that the winding up proceedings are taken on notice but still went ahead to grant the order Ex-parte, thus rendering the order made without jurisdiction and by extension this Court is also deprived of jurisdiction to entertain the appeal. It is my view that whether the appellant is disposing or transferring the assets of the company, it must be heard before any decision affecting its rights and obligations is made as provided by Section 36 (1) of the 1999 Constitution (as amended).7[Emphasis added].
Essentially, the raison d'etre of Rule 4 of the Winding-Up Rule as interpreted in a long line of decided authorities, including Argiji Properties Ltd.'s case (supra), is the necessity of allowing the respondent company an opportunity to be heard, given the potentially paralyzing impact of such proceedings.8
3. Exceptions to Rule 4 of the Winding-Up Rules: the Personal or Direct Impact Test
In winding-up proceedings, prayers for orders of injunctions, appointment of a provisional liquidator or special manager, leave to advertise the petition, stay of proceedings, substitution of petitioner(s), leave to appear or defend, dismissal of petition, substituted service, extension of time to complete the winding up, leave to make a call on the contributories of a company, taking possession of properties, etc., are common. Some of these applications, such as substituted service, must as a legal necessity be made ex-parte. The question then arises on whether Rule 4 of the Winding-Up Rules prescribes a blanket prohibition and categorically forbids all or any ex-parte application in winding-up proceedings.
While the Court of Appeal was right to have dismissed the applicant's motion ex parte in Argiji Properties Ltd.'s case9 seeking interim injunctive reliefs against the Respondent's Directors, officers, agents or servants or any of them however, it must be stated that there is a danger in making a sweeping assertion that Rule 4 of the Winding-Up Rules admits no exception or affords no discretion on the part of the applicant. It is instructive to note that Rule 4 of the Winding-Up Rules expressly mandates that notice of the motion must be served on every individual against whom an order is sought. This provision reflects the drafters' intention to ensure that individuals whose rights and interests may be significantly affected have the opportunity for a fair hearing. This principle aligns with public policy, emphasizing that orders capable of dissolving or affecting a company's assets and liabilities should not be granted without proper notice to affected parties, in contrast to applicants seeking innocuous applications.
Proceeding from the above explanation, it is clear that not every application in winding-up proceedings seeks an order against parties. Certain applications, such as applications for substituted service, leave to advertise, extension of time to complete the winding up, etc., would fall into this category. Could these applications therefore be validly brought ex parte? This question was first answered in Provisional Liquidator, Tapp Ind v. Tapp Ind,10 where the Supreme Court while interpreting Rule 4 of the repealed Companies Winding Up Rules 1983 which is in pari materia with the extant Rule 4 held:
This rule appears to allow for ex-parte applications being brought except where an order is being sought against any person in which case such person will have to be put on notice of the motion. As I have earlier observed, the appellant's motions of 5/12/88 and 12/12/88 did not seek an order against any of the parties. I, therefore, hold that these motions
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