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5 NWLR (pt 239 102 C.A page 115
OWOLABI KOLAWOLE J.C.A
EUGENE CHUKWUEMEKA UBAEZONU, J.C.A
INCORPORATED COMPANIES – LEGAL STATUS OF.
[Sam Eleanya, Agboola Omolola Oluwafolakemi, Eleanya Kalu Vincent, Eleanya Ugochi Vine]
The 2nd appellant Baltic Engineering (Nig) Ltd was a warded a contract to build a transit accommodation for the Nigerian Army. Baltic gave a sub-contract of the job to the respondent herein. The sub-contract agreement was signed by the 1st Appellant Brigadier G.T Kurubo as the Managing Director of the 2nd Appellant and on Mr. S.O Adedeji signed for the respondent. The Nigerian Army terminated its contract with the Appellant in turn terminated the sub-contract with the respondent and in a termination agreement was entered into to the effect that Zach-Motison Nig Ltd (the respondent) was entitled to only part of the second stage of payment of N22.000.00 there was also on arbitration clause in the Agreement. The respondent thereafter sued the appellant jointly and severally claiming the sum of N55,049.00 plus interest being the amount due to it in respect of building job done beyond 2nd stage of payment. The trial judge awarded N40,000.00 with 6% P.A from date of termination to the respondent appellants Appeal.
Whether a Managing Director who acts on behalf of a limited liability company is jointly and severally liable to third parties for such acts here the limited liability company is known?
An incorporated company is a different legal entity from the management of the coy. It has a separate and distinct life and existence. The law in recognising its separate and distinct identity vesta in it a legal personality which an sue and be sued in that name. In view of the fact that an artificial person or coy vested with legal or juristic personality lacks the natural or physical capacity to function as a human being, those who work in it do all things for and on behalf of it. Where the an agreement is so executed by a person in authority, the company is liable or deemed to be liable for the act or acts of the person. In the instance case, both Brigadier Kurubo and Mr. Adedeji were the direct parties to the agreement – Exhibit J. this is clear from the commencement which reads:
“AN AGREEMENT made this 25th day of March 1980 between Brigadier G.T. Kurubo of Baltic Engineering (Nigeria) limited and Mr. S.O Adedeji of Zach-Motison (Nigeria) limited of No. 10 Akinwunmi street, Yaba (hereinafter called the contractor) of the other part”