Quarry firm drags Ebonyi State government to court, demands N500 million over illegal sealing of business premises

By Okey Agwu

At a time other State Governments are working round the clock to encourage local investments and boost employment for its citizens, the Ebonyi State Government appears determined to stifle local investment and job creation through multiple taxation and highhandedness. Consequently, an indigenous quarry firm operating in Ishiagu, Ebonyi State, the Crushed Rock Industries Nigeria Limited, has dragged the Ebonyi State Government to the Federal High Court, Abuja, challenging the unlawful sealing of its business premises and quarry by the government for its inability to pay exorbitant, arbitrary and incredibly-high taxes. The government, which is also seeking to turn the company into its official toll collectors, is equally demanding that the company pays the said arbitrary taxes upfront, a move the company perceives as outrageous and unacceptable.

The suit, filed on behalf of the plaintiff company by Chief Mike Ozekhome, SAN, has the Federal Ministry of Mines & Steel Development, the Government of Ebonyi State, Attorney General of the State and Edwin Obiora Onwe, who was the then Special Assistant to the governor on Solid Minerals, but now the acting Commissioner, Ministry of Solid Minerals Development, as defendants.

The firm is praying the court, among other demands, for an order mandating the Ebonyi State government to jointly pay to the Plaintiff, the sum of Five Hundred Million Naira as damages for the illegal, wrongful and unlawful sealing up and shutting down, viet armis, of the quarry site of the Plaintiff at Ishiagu, Ivo Local Government Area of Ebonyi State for more than five months now.

The court processes reveal that the crisis between both parties had started sometime in May, 2019, when the Board of Directors of the Plaintiff honoured an invitation by the Governor of the State at Abakaliki, only to be reportedly humiliated, cajoled, ridiculed and threatened to either immediately re-float the quarry company or have the premises sealed up completely.

“The Directors were subjected to great indignity and utter humiliation, with the Governor talking down on them like “school children”, one of the depositions in the processes asserted.

In its desperation to give a dog a bad name in order to hang it, the Ebonyi State Government, in an apparent somersault, accused the company of inability to protect and improve on the environmental situation of the host community (Ishiagu), where it has carried out its mining activities for over forty years and ordered the company to construct a concrete road into the adjoining major road in the host community, even upon every credible evidence of the company’s incapacity to accomplish same.

The firm however replied and reiterated that it has observed the highest technologically-possible environmental standards and also carried out numerous Corporate Social Responsibility programmes but that it cannot conveniently execute a concrete road project demanded by the State Government as same was beyond its financial capability in view of its lean resources. The Company, as part of its social responsibility to the host community, has for over forty years awarded scholarships to the indigenes, built a school and a town hall, graded the rural roads in the community and engaged in youth empowerment programmes.

In its defence, Ebonyi State Government and its agents, sued as 3rd to 6th Defendants in the suit, is justifying its action of closure of the quarry firm on two flanks: alleged environmental degradation by the plaintiff company and refusal to pay haulage fees charged by the State government. In paragraphs 11, 12, 15, 24 and 25 of its Counter affidavit filed on 1st June, 2020 in opposition to the originating Summons, the Ebonyi State Government stated emphatically that the crux of the case between the plaintiff and the 3rd Defendant is predicated upon environmental degradation as a result of the activities of the plaintiff which, it alleged, refused to comply with an order for “Closing of abandoned Pits”. However, in the affidavit in support of the Motion on Notice also filed on 1st June, 2020 by A. A. Ibrahim, SAN, on behalf of the 3rd to 6th Defendants challenging the court’s jurisdiction, the Ebonyi State Government, contrary to its earlier position, maintained in paragraph 3(i) thereof, “that the dispute submitted for adjudication does not bother on the mining activities of the Plaintiff but rather on the Plaintiff’s failure to pay haulage fees as prescribed by law”. Meanwhile, the Federal Ministry of Mines & Steel Development, which is the 1st Defendant in the matter and the exclusive regulator of mining activities in Nigeria, has completely exonerated the plaintiff-company from every allegation of violation of any environmental regulation or programme. In paragraph 11 of its Counter Affidavit to the Originating Summons filed on 18th June, 2020, the Ministry affirmed “that the plaintiff has been complying with environmental protection and rehabilitation programmes by filing environmental impact assessment report to the 1st Defendant as and when due.”

Again, the Governor raised the tempo of the demands in a letter dated 27th of January 2020, and the Company was alarmed to receive a notice of the Ebonyi State Government with an unreasonable and unilateral increment in haulage fees and other levies to the tune of a whooping N18,700,000 (Eighteen Million, Seven Hundred Thousand Naira) monthly, from an initial sum of about Two Million Naira which quarry companies in the State usually pays monthly to the State Government, all amounting to a staggering N224, 600, 000.00 (Two Hundred and Forty-Four Million, Six Hundred Thousand Naira) annually.

The notice, which also contained the State government’s inexplicable decision to terminate the use of contract Revenue Collectors for the receipt of government revenues for quarry companies, read as follows:

“I am pleased to convey to your company management an approval of His Excellency, Apostle Engr. (Dr) David Nweze Umahi FNSE, FNATE, Governor of Ebonyi State the authourity to collect the haulage fees and remit the same into the designated Ebonyi State Consolidated IGR account. The approval takes from 1st February, 2020.”

The demand notice, which was conspicuously pasted on the gate of the Company, further demanded that, “The haulage fee for one month is calculated on basis of 150 tons per hour at #6,000 per 10 tons which gives a total sum of Eighteen Million and Seven Hundred & Twenty Thousand Naira (#18,720,000.00) only and Two Hundred and Twenty Four Million, Six Hundred Thousand Naira only (224,600,000.00) for one year”.

Despite the intimidating and repressive posture of the State Government against the Company, the latter chose the path of peace and diplomacy in resolving the issues at stake, but to no avail. It would further be recalled, according to the suit, that the State government had extended an invitation to the company for a meeting through a letter dated 23rd January, 2020 on the same subject matter. The said meeting, which was attended by two Management staff of the Company, was held at the State’s Deputy Governor’s office. The Originating Summons disclosed that “At the said meeting, which took place at the Deputy Governor’s office in the Government House and presided over by the Deputy Governor himself, quarry owners (including the plaintiff company) were merely directed and threatened to either comply or face sanctions which included the sealing of our business premises”.

It was further disclosed that on 11th February, 2020, the Company, represented by the same Management Staff again, also honoured an invitation to a meeting with the Governor of Ebonyi State, at the Government House, Abakaliki, vide a letter dated 10th February, 2020. “As usual, the Governor merely threatened to deal with any company (including the plaintiff) that failed to pay the government’s unilaterally and arbitrarily imposed outrageous haulage fees”, the Court Summons stated.

On 4th May, 2020, the same Management Staff of the firm again honoured an oral invitation to a meeting with Ebonyi State House of Assembly, on the same issue of forcible payment of arbitrarily and unilaterally imposed haulage fees. The Company’s delegation to the meeting, made up of two Management Staff, was said to have been stunningly and unlawfully detained for several hours at the House of Assembly premises and later transferred to the State CID, Abakaliki, for no just cause. According to the deponent to the Further Affidavit in further support of the Originating Summons, “They were initially detained at the cell within the legislative complex at Nkaliki Road, Abakaliki, before being transferred to the State CID, Opposite Government House, Abakaliki. It was much later that they were released on bail and told to go, over a mere civil matter, after much dehumanization, intimidation and serial threats”. The government later mobilized its agents and thugs to proceed and seal up the business premises of the company which had remained sealed till date.

In the shut-down notice titled “Directive to Shut Down” with reference number EB/SSG/M.58/IX/699 and dated 21st January, 2020 and signed by the Secretary to the State Government, Ebonyi State Government hinged its action on alleged violation of environmental regulations by the Company. In a commendable diplomatic move, the plaintiff company made a representation to the Governor of the State via a letter dated 17th March, 2020, with a passionate appeal that the action be reversed and its quarry re-opened for business. In its reply with a stiff stance, the Government of Ebonyi State via its letter to the plaintiff signed by the Acting Commissioner for Solid minerals and dated 20th April, 2020 with reference number EBS/MSMDC/HC/1/23, but delivered to the Plaintiff on the 5th of May, 2020, the Government of Ebonyi State, contrary to its earlier position in its letter of 21st January, 2020, specifically stated: “that the sealing and/or closure of your Ishiagu Quarry site was as a result of your non-remittance to the Government the accruable assessed haulage fees, hereby sabotaging the Government’s IGR policy among other things”.

The Counsel to the Plaintiff, Mike Ozekhome, SAN, in his replies, has consistently maintained in the court summon that Plaintiff’s quarry Company has always observed the highest technologically possible environmental standards in its mining activities in Ishiagu, which the host communities can easily testify to, and over which the supervisory bodies, the 1st and 2nd defendants, have never complained.

According to the Court Summons issued by Mike Ozekhome, SAN, it is stated that the ill-treatments meted out to the plaintiff company is simply as a result of its inability to meet up with the outrageous haulage fees, Airport project levies and other sundry levies arbitrarily, capriciously and whimsically imposed on it by the Ebonyi State government under the leadership of Engr. David Nweze Umahi.

While urging the Federal High Court to discountenance the claims and contentions of the Ebonyi State government in its counter affidavit, Ozekhome stated that the plaintiff never at any time agreed to payment of any specific amount with the Ebonyi State Government. “The government only imposed the sum unilaterally and arbitrarily on the Plaintiff as its alleged haulage fees, without taking into cognizance the current earnings of the Plaintiff, which could not pay such outrageous fees”, he further submitted.

Haulage operating firms in the State which have been serially harassed and intimidated with their businesses threatened by the Ebonyi State government, including the Ebonyi public, are waiting with baited breaths to see who blinks first among the warring parties as the matter is slated for hearing and subsequent determination at the Federal High Court, Abuja on 9th July, 2020.

Meanwhile, the people from the host community, under the aegis of ANO COMMUNITIES, most of whose indigenes are in the direct and indirect employment of the Company, are said to be suffering serious economic dilapidation and deprivation arising from the government’s sealing of the said company, and have cried out to the State Government to reconsider its stance on the matter. Their appeals appear to have been contemptuously ignored. In their letters titled “PRAYER FOR THE RE-OPENING OF CRUSHED ROCK INDUSTRIES NIGERIA LTD” and dated 13th April, 2020 and 13th June, 2020, respectively, the people of Ishiagu under the aegis of ANO COMMUNITIES, prayed the Governor of Ebonyi State to re-open the quarry of the plaintiff company as “myriads of our people depend wholly on the existence/operations of Crushed Rock Industries Nigeria Ltd to earn daily living in one part while others depend on same to effect their continuous education and farming activities. Interestingly sir, out of the total percentage of the workforce of the CRIL, 85 percent are from our communities with lots of dependants to cater for”.

Crying over the hardship foisted upon the local communities by the sealing/closure of the company, the people further lamented that “The closure of CRI in a time like this is most disheartening considering the fact that schools are on vacation and many youth are idle and would have depended on the existence of CRI to raise money (to) which they will use to go back to school when school resumes”. The lamentations and supplications of the villagers are yet to be hearkened to.

It is hoped, in the interest of industrial harmony, job opportunities for the host communities and the development of the State that both parties would see reason to return to the negotiation table to resolve the issues in controversy.

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