| Cameroun, High court of mezam, 11 juin 2011, /09

Ohadata J-13-221 PROCEDURES COLLECTIVES – COMMADEMENT – PROCEDURE ERRONEE – CESSATION DES PAIEMENTS – DESIGNATION D’UN JUGE COMMISSAIRE ARTICLE 28 AUPCAP ARTICLE 29 AUPCAP MOTION ON NOTICE – ORDER OF MANDAMUS – RULING SET ASIDE – WRONG PROCEDURE – PRELIMINARY OBJECTION – SPECIFIC PERFORMANCE – CESSATION OF PAYMENTS – COLLECTIVE PROCEEDINGS – APPOINTMENT OF COURT OFFICER
The court was seized by motion on notice whereby the depositor was praying the court for an order to cause the Aa Z of a financial institution which had closed its doors or any other branch of the establishment in Cameroon to reimburse his savings. The court ruled that since the financial institution was in a difficult financial situation, an application on motion was an improper procedure. The customer ought to have applied for legal redress of the establishment based on section 28 of the Uniform Act on Collective Proceedings which provides that, collective proceedings may be initiated at the request of one creditor, no matter the nature of his claim, as long as it is unquestionable.
However, as a financial institution and under the control of COBAC and given that a civil matter is a party’s matter and the court cannot rule “ultra petita”, the court had to determine whether it was competent to initiate collective proceedings against the establishment. By virtue of section 29 of the UACP, the competent court may be seised of the matter of its own motion, notably on the basis of information provided by the representative of the Public Prosecutor’s Department, the auditors of the private corporate bodies where the latter have auditors, partners or members of the said corporate bodies or institutions representing the staff who shall indicate to the court the facts likely to motivate such initiative by the court. The court was reliably informed by the representative of the institution that it was in financial difficulty and the court had to summon its Bamenda branch manager and appointed a court officer to hear him. Sections 28 and 29 UACP (High Court of Mezam (Bamenda), CHO Consular v. Caisse d’Epargne et de Crédit (CAPCOL) and the Ac AH X C, suit no HCB/P/M/09 of 11 June 2011)
This is a motion on notice initially filed in the registry of this court on the 5th day of July 2012 wherein the applicant is seeking the grant of the following prayers;
1) An order commanding the general AH X C to pay the total amount saved by the applicant in the savings book of CAPCOL.
2) An order commanding any C Z AH in any of the ten regions in Cameroon to pay the total amount saved by applicant in the savings book of his financial institution.
3) An order that the respondent bear the cost of these proceedings being 500.000fcfa. And for any other orders that this honourable court will deem fit in the circumstances. The mater was initially scheduled for the 7th day of July 2011, the respondents herein
were duly served but failed to grace this court with their presence. After several
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adjournments, the court proceeded to rule in favour of the applicants. The respondents herein applied to set the ruling aside on the grounds that the general director was out of the country. That the latter being only party duly mandated to cause an appearance or to brief counsel to explain their absence in court.
Rising to the explanation this court in suit number HCB/199M/2012 ruling on the 29th day of October granting the prayers of applicants therein and the respondents herein. Thus, the ruling in suit number HCB/150M/2012 delivered by Afong J. wherein the respondent herein was ordered to pay the latter’s savings account domiciled in their financial institution was set aside.
At the hearing on the 26th day of November 2012, the respondent herein raised a preliminary objection in the following terms. That by virtue of section 15 of law No 15 sub 1 B, the Court of First Instance is vested with the exclusive jurisdiction in civil matters where the amount claimed does not exceed ten million FCFA. That same court is the only competent court in commercial matters relating to disputes between economic operators and credit institutions.
In reply, learned counsel for the applicant submitted that this court is vested with the powers to issue the prerogative writs of mandamus and prohibition. The latter proceeded to submit that the application herein is not for damages but for an order of specific performance. He proceeded to state that the section of the law afore mentioned refers to a dispute between the parties. That in the present case; the claim is not the subject of a dispute.
Thus, the facts to the adjudicated upon by this court. In principles both gentlemen of counsel for the applicant and respondent are correct in as far as the position of the law is concerned. The question herein is that there is the cause of action herein. It certainly is not a dispute because the applicant herein is the customer of the respondent who is a financial institution. Certainly, it cannot be a dispute where a client of a financial institution is requesting the payment of his savings. Is the application an order for mandamus? In a sense, it is since it can be said that by law the respondent is obliged to make available the savings of his client at the first request for withdrawal. If an order of mandamus is issued, how will it really help this applicant if the financial institution does not respect the court’s order?
If this court expounds upon the history of this application and the attitude of the respondents, it is to highlight the plight of an individual who trust his money in a financial institution and cannot retrieve same. This court takes judicial notice of that fact that the respondent financial institution has closed its doors within this jurisdiction. This court also takes judicial notice of the plight of the other customers and the resultant economic insecurity. In suit number HCB/150M/2012 wherein the respondent was praying this court to set aside the first ruling ordering the payment of the applicant herein stated in paragraph 7 of the affidavit in support of the motion to set aside the ruling, the doors of the Bamenda branch office have been temporally closed because of serious misappropriation and loss of very important document in the Bamenda branch office that is being investigated.
The applicant herein is actually requesting to be paid from another branch in Cameroon which is banking practise. Why is the respondent reason objection and applying to set rulings aside instead of paying his client money lodged in his institution? There is only one reason; this is because the respondent financial institution is in cessation of payments. It was stated in the case of jugement commercial n°099 of 23rd July 2004; affair Société SOTIBA SIMPAFRIC. Ohada J-09-342, that where a company’s available assets are insufficient to service its available liabilities, it is considered to be in cessation of payment within the purport of article 25 of the UAPC. TRIBUNAL HORS CLASSE DE DAKAR.
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Actually, the proper action herein was for the leaned counsel for the applicant who is a creditor of the respondent to seize the court under article 28 of the Uniform Act on Collective Proceedings and the discharge of liabilities which reads thus; Article 28
Collective proceedings may be initiated at the request of one creditor, no matter the nature of his claim, as long as it is unquestionable, liquid and due. The creditor’s summons shall specify the nature and amount of his claim and state title upon which the debt is founded.
The creditor’s claim is not in contention thus if the latter availed himself of the provisions of the UACP afore cited, the application would have been proper. It is trite principle of law that a civil matter is a party’s matter and a court should not rule ‘ultra petita’. However, article 29 of the UACP vest the court with the unfettered powers to initiate collective proceedings of its own motion. Same article stipulates: Article 29
a. The competent court may be seized of the matter of its own motion, notably on the basis of information provided by the representative of the public prosecutor’s department, the auditors of private corporate bodies where the latter have auditors, partners or member of the said corporate bodies or institutions representing the staff who shall indicate to the court the facts likely to motivate such initiative by the court. The president of the competent court shall cause the debtor to be summoned by the registrar, by means of an extrajudicial act, to appear before the court sitting in camera. The extrajudicial act shall content a full reproduction of the present article
b. Where the debtor appears before the court, the president shall inform him of the facts justifying his initiative to commence the proceedings of its own motion and shall obtain his remarks. Where the debtor acknowledges being in cessation of payments or in difficulty or where the president is convinced that he is in such a situation, the president shall grant him a period of thirty days within which he shall make the declaration and the composition agreement proposal provided for in article 25, 26 and 27 above. The same period of time shall be granted members of a corporate body who are indefinitely and jointly and severally liable for its debts. After this period, the competent court shall give a ruling in open court.
c. Where the debtor appears before the court, mention shall be made of the fact and the competent court shall rule at the very next session in open court.
In the present case, the learned counsel for the respondent in paragraph 7 informed the
court of their inability to pay their dues. The reason is of no import to the clients of the financial institution. The court is further informed by the applicant herein that the respondent cannot meet its available liabilities with its available assets. ARE FINANCIAL INSTITUTIONS SUBJECT TO THE JURISDICTION OF THE COURT IN COLLECTIVE PROCEEDINGS?
It is enigma financial institutions are not subject to the jurisdiction of the courts in these proceedings once. The position of the law is that the regulatory bodies control the functioning and are vested with the role of appointing an administrator company have eluded the control of the regulatory bodies. The court is vested with the powers to trigger the proceedings and call on the regulatory bodies to appoint an administrator or a liquidator as the case may be. This court takes judicial notice of the mayhem caused by COFINEST and
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another financial institution which were surrounded by their military clients in Limbe for purposes of collecting their dues. If the creditors have seized the court, it would be irresponsible for a court to fail to apply the provisions of article 29 of the UACP.
A plethora of case law affirms the hybrid role of the court and the regulatory bodies in relation to these proceedings. To cite a few :
In the case of Société de Fournitures Industrielles du Cameroun dite SFIC SA c/ Liquidation des Banques Méridien BIAO. Cameroon, arrêt n°007 of 28th Ab 2008, the application of the Uniform Act on Collective Proceedings for the discharge of liabilities in a matter of the liquidation of a bank was deemed regular by the CCJA. The role of the courts in relation to financial institutions was more succinctly expatiated in the matter of the legal administration of Banque Populaire du Gabon in judgment n°001/2000/2001, du 5 Janvier 2001 thus;
The competence of the court and COBAC are not in mutual conflict; it is within the ambit of the latter’s role to control the functioning of financial institutions. It is incumbent on the courts to ensure that the applicable law in relation to collective proceedings is respected by controlling the regularity of the decisions of COBAC. IS THIS COURT VESTED WITH THE JURISDICTION RATIONE LOCI?
The provision in relation to the court’s competence is embodied in article 4 of the Act of instance. Same article is sufficiently elaborate and needs no further discourse, it reads thus; The competent court to deal with collective proceedings shall be the court within whose jurisdiction the debtor has his principal place of business or, where it is a corporate body, its registered office or where it has no registered office within the national territory, its principal place of business. Where the head office is located abroad, the collective proceedings shall be before within whose jurisdiction the principal activities of the company are effected within the territory.
In the present case, it is stated in the affidavit filed by the respondents that the head office of this company is in Douala. However, it is also stated that the only branch with problems is the Bamenda branch. The competence loci is of greater import where it is debtor initiating the proceedings. In any case, where the respondent has a branch in Bamenda the jurisdiction of the court is in order. What is germane is that the customers of this financial institution whose savings are unavailable will be caused to incur further expenses by going to Douala.
In light of the afore analysis, this court makes the followings orders;
ORDERS
1) THAT THE REGISTRAR-IN-CHIEF OF THIS COURT IS AL Y AI AG B AJ OF CAPCOL TO APPEAR BEFORE THE PRESIDENT OF THIS COURT ON THE 30TH DAY OF JANUARY 2013 TO EXPLAIN THE ECONOMIC AND FINANCIAL SITUATION OF HIS COMPANY.
2) THAT THE PARTY BE SUMMONED BY MEANS OF AN EXTRAJUDICIAL ACT.
3) IN THE INTERIM, THIS COURT APPOINTS A COURT OFFICER JUSTICE A AK AI AG B AH OF THE BANENDA BRANCH CAPCOL, IN ORDER TO ASSIST THE COURT OFFICER IN ASSESSING ALL THE CREDITORS OF THE BAMENDA BRANCH AND THE SITUATION OF THIS FINANCIAL INSTITUTION.
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4) THAT THE STATE COUNSEL OF MEZAM SHOULD ASSIST THE COURT APPOINTED OFFICER IN THE EXECUTION OF HER MISSION WHERE THE CIRCUMSTANCES SO REQUIRE.
5) THAT THE REGISTRAR-IN-CHIEF OF THIS COURT SHOULD ALSO CAUSE THIS RULING TO BE SERVED ON THE MINISTER OF FINANCE BY WAY OF AN EXTRAJUDICIAL ACT.
6) THAT WITHIN THE SPIRIT OF THE UACP, THESE ORDERS ARE ENFORCEABLE IRRESPECTIVE OF AN APPEAL.