The Duty of the Nigerian Receiver to ‘Manage’ the Company

Abstract

Nigerian courts have equivocated on the duty of the receiver to manager a company in relation to which he has been appointed resulting in inconsistencies and uncertainty in the law and practice of receivership in Nigeria.. The Companies and Allied Matters Act, (CAMA) 2004, governs insolvency matters in Nigeria. In s. 393, CAMA sets out the main duty of the receiver: to realise the debt on behalf of the person who appoints him. But in s. 390, CAMA instructs the receiver to manage the company over which he has been appointed, in the interest of the company, and for the benefit of all interests concerned. At first blush, these provisions appear contradictory. However, when the history of s390 is examined, the intention of the law-makers for this section becomes clearer. It is argued that s390, if given purposive interpretation, would engender a positive duty on the part of the receiver, not just to receive, but also to manage a company for all interests concerned.

Keywords: Receivership, Nigeria, s390 CAMA 2004, s393 CAMA 2004