Shareholders Sue FG over Plans to Borrow Unclaimed Dividends

Goddy Egene
Determined to stop the federal government from taking over their unclaimed dividends, some shareholders of companies listed on the Nigerian Stock Exchange (NSE), under the aegis of Palm Wealth Shareholders Association(PWSA), have instituted a case against the government at Federal High Court of Nigeria, Abeokuta Division, Ogun State.

The Finance Act 2020, signed into law by President Muhammadu Buhari last month provides that any unclaimed dividends of a public limited liability company quoted on the NSE and any unutilised amounts in a dormant bank account maintained in or by a deposit money bank which has remained unclaimed or unutilised for a period of not less than six years from the date of declaring the dividend or domiciling the funds in a bank account shall be transferred immediately to Unclaimed Funds Trust Fund.

However, PWSA has gone to the Federal High Court of Nigeria, Abeokuta Division to stop the government from transferring the unclaimed dividends to the proposed trust fund.
The President of PWSA, Mr. Simon Emokeraro, said in a statement that the case with Suit No. FHC/AB/FHR/14/2021, which has the Attorney General of the Federation and Minister of Justice, Minister of Finance, Budget and National Planning and Accountant General of the Federation as parties, would be heard on February 25, 2021.

According to him, the shareholders are seeking, “an Order of the Hon. Court for the enforcement of the applicants’ fundamental rights to acquire and own immoveable and moveable personal property; an order restraining the federal government, that is, the Respondents from calling for or transferring the unclaimed dividends of the Applicants in public quoted companies to the unclaimed Funds Trust Fund; an order restraining the Respondents from harassing, intimidating, inviting the companies or their Registrars for the purpose of transferring the unclaimed dividends belonging to the applicants to the Unclaimed Funds Trust Fund contrary to the Constitution of the Federal Republic of Nigeria 1999(as amended), the African Charter on Human and People’s Rights Act, Laws of the Federation.”

Others are: an order of the Hon. Court restraining the Respondents from borrowing the unclaimed dividends belonging to the applicants; a declaration by the Hon. Court that the applicants have rights guaranteed and protected under sections 43 & 44 of the Constitution of the Federal Republic of Nigeria, Articles 14 and 24 of the African Charter on Human and People’s Rights and Article 17 of the United Nation’s Charter on Human Rights 1945 and sections 42 (1) and (2) of the Companies and Allied Matters Act.

A declaration of the Hon. Court that Part XV of the Finance Act 2020 calling for or transferring the Unclaimed dividends of the applicants in public quoted companies to Unclaimed Funds Trust Fund by the respondents without any constitutional grounds is unconstitutional, null and void and of no moment as it violates the applicants fundamental rights and a declaration of the Hon. Court that the applicants are entitled to claim their dividends without coercion, stampede and intimidation from the respondents.