LEGAL PRINCIPLE: CIVIL PROCEDURE — Capacity to Sue — Incorporated Company — Proof of Incorporation Required When Challenged
PRINCIPLE STATEMENT
When a company's capacity to sue is challenged, it must prove its incorporation; failure to do so means it does not exist in the eyes of the law.
RATIO DECIDENDI (SOURCE)
Per Uwaifo, JSC, in African Continental Bank Plc & Anor v. Emostrade Ltd (2002) NLC-951998(SC) at p. 9; Paras A–C.
"It follows that in the present case, the respondent has failed to prove that it has a juristic personality and that it can sue (and be sued). That is the same as saying that it does not exist in the eye of the law."
EXPLANATION / SCOPE
A company has legal personality only upon incorporation. When its capacity to sue is challenged, it must prove incorporation. The certificate of incorporation is the primary evidence. Failure to prove incorporation means the company has no legal existence. Such a company cannot sue or be sued. The principle is fundamental to corporate law. The court will strike out the action if the company cannot prove incorporation. The burden is on the company asserting its legal personality. The rule applies even if the company was previously known to exist. The party challenging capacity need only raise the issue; the company must prove its existence. The principle prevents unincorporated entities from litigating.
