DEVELOPING NEWS:
It was no doubt a great relief for legal practitioners in Nigeria when the Court of Appeal recently held that the provisions of Section 25 of the Money Laundering Prohibition Act, 2011, (as amended) does not apply to them.
In a case between FRN and Chief Mike Ozokheme, the Court of Appeal was faced with a major issue on “Whether legal practitioners are excluded from the definition of “designated non-financial institutions” as contained in the Money Laundering Prohibition Act, 2011?
The court also held that it is not a requirement of the law that a legal practitioner has a responsibility to investigate his client`s source of income for the payment of the lawyer`s legal fee. Meaning that confirming the legality of the source of the fund from which he would be paid his legal fee is not the legal responsibility of the lawyer.
HISTORICAL BACKGROUND
The appeal to the Court of Appeal arose from an ex – parte order by the Federal High Court, Lagos obtained by the EFCC in the name of Federal Republic of Nigeria (FRN). The ex-parte order was for the interim attachment and an order freezing for a period of one hundred and twenty (120) days, an account belonging to Mike Ozekhome’s Chamber.
An ex-parte order is a court order obtained by an applicant solely on the basis of an ex – parte application. That is to say, the facts deposed in the affidavit and all supporting evidence tendered in the application are solely supplied by the appellant. Such order is granted without hearing from the person/s to be affected by the order.
Amongst other contentions, EFCC argued that Chief Ozekhome Chambers ought to have known that the fund it received from Ayo Fayose was from proceeds of crime, and therefore, shouldn’t have received it as payment for professional fees. The court disagreed and held otherwise.
BASIC FACTS
- Judgement was given by the Lagos Division of the Court of Appeal and the appeal was filed by the Economic and Financial Crimes Commission (EFCC).
- The appeal was against the unfreezing of Chief Ozekhome’s account with Guaranty Trust Bank, which was earlier frozen by an interim ex parte order placed on the funds by Justice Anka of the Federal High Court Lagos, at the instance of the EFCC.
- The case arose from a deposit of the sum of N75million into the account of Chief Ozekhome Chambers, which the EFCC alleged to be the proceed of unlawful activity from Mr. Ayodele Fayose, who was then a sitting Governor in Ekiti State.
- The fund in question was transferred to Ozokheme`s account from Fayose`s account, which was also frozen by EFCC at the instance of a court order by Justice I.B.M Idris of the FHC Lagos in 2016.
- Chief Ozekhome Chambers, acting for Foyose successfully challenged the same order by Justice I.B.M Idris and got a new order setting it aside from Justice Taiwo of the FHC Ado Ekiti.
- Thereafter, the sum of N75million was transferred to the account of Chief Ozekhome Chambers by Ayo Fayose as part payment for legal services rendered to him by the chambers.
- The Court of Appeal held that there was no infraction by Chief Ozekhome Chambers and therefore, that the interim ex parte order placed on the funds by Justice Anka of the Federal High Lagos, at the instance of the EFCC was made in error, and thereby dismissed EFCC`s appeal.
NOTABLE QUOTE
“No doubt a Legal Practitioner is entitled to his fees for professional services rendered and such fees cannot be rightly labeled as proceeds of crime. Further, it is not a requirement of the law that a legal practitioner would go into inquiry before receiving his fees from his client, to find out the source of the fund from which he would be paid. There was nothing on record at the time the money was paid to the Respondent’s Chambers to show that the money was from the proceeds of unlawful activities and the lower Court was right not to have agreed that the money was from unlawful activities.” … CHIDI NWAOMA UWA, J.C.A.
WHAT WE ARE WATCHING
We are watching to see if the EFCC will further appeal this matter up to the level of the Supreme Court.
We shall keep our readers posted.
FOLLOW THE NEWS
This news is still developing and we are monitoring it for you. In the days and weeks to come, we shall continue to monitor the situation and we will continue to update our readers with the latest developments. Please let us know what part of this news that is of interest to you. Let us know what you wish to know as things develop. Also, avail us with any information that is available to you that may help us better inform our readers. You can sign up to The Intel newsletter to receive expert analysis on this news and things that matter to you.
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