The Law Of Incorporated Trustees (Churches, Mosques, Et Al) By Ebun-Olu Adegboruwa, Esq

In recent times, there has been a lot of focus on religious
organisations, as to their proliferation, operations, organisations
and utility. Without the churches, mosques and other faith-based
entities, perhaps the case of Nigeria may have been worse than we
are currently experiencing, given that many of them have become
more of alternative government. This piece is thus meant to assist
them to appreciate their legal status, in order to guide their
operations more meaningfully.

The freedom of association is well guaranteed under section 40
of the 1999 Constitution to the extent that ‘every person shall be
entitled to assemble freely and associate with other persons, and
in particular he may form or belong to any political party, trade
union or any other association for the protection of his
interests’. Spiritually speaking, God Himself sanctioned the
association of persons in Matthew 18:20, where it is stated that
‘where two or three are gathered together in my name, there am I in
the midst of them’. The number of churches and mosques in Nigeria
are by far now countless and indeed the registered ones are far
less than those operating without legal recognition. The emphasis
in this piece is on the ones registered by law, specifically by the
Corporate Affairs Commission (CAC), in an attempt to help them
streamline their administration and management, in line with legal
requirements.

Part C of the Companies and Allied Matters Act deals with
Incorporated Trustees and in section 590 of CAMA it is stated as
follows:

“Incorporation of trustees of certain communities, bodies and
associations:

(1) where one or more trustees are appointed by any Community of
persons bound together by custom, religion, kingship or nationality
or by any body or association of persons established for any
religious, educational, literary, scientific, social, development,
cultural, sporting or charitable purpose, he or they may, if so
authorized by the community, body or association (in this Act
referred to as ‘‘the association’’) apply to the Commission in the
manner hereafter provided for registration under this Act as a
corporate body.

(2) upon being so registered by the Commission, the trustee or
trustees shall become a body corporate in accordance with the
provisions of section 679 of this Part of this Act.”

Pursuant to the above provisions of the law, all religious
organisations are required to be registered under Part C of CAMA as
incorporated trustees and those previously registered under the
Land (Perpetual Succession) Act are deemed to be registered under
CAMA. The general thrust of the above quoted law is that churches
and mosques should be registered and operated as a single central
entity, although they are free to have branches all over. Thus,
such an organisation becomes incorporated because it has been
accepted by law, through its trustees, who are deemed to own all
its properties and assets. It is in the same way that companies,
such as banks and other legal establishments, have a single
registered name with branches spread around for administrative
convenience. Now to the issues.

From the foregoing analysis, it is only the trustees of the
church or mosque that can legally acquire land or other property on
behalf of the church, in the name of the incorporated trustees
only. In other words, where branches of the church or mosque desire
to acquire land or other assets, they can only do so legally, in
the name of the incorporated trustees and not the branch. Even
though it may have a constitution, that should only be a document
to guide its operations, as the trustees are deemed to be the
principal actors in the eyes of the law. Anything done outside the
trustees, such as buying land or other assets, will not be covered
by law. Afortiori, it can only sue or be sued in the name of the
incorporated trustees, for such suit to be competent and
justiciable.

What operates in practice presently however, is a different ball
game altogether, as most churches or mosques just gather together
some persons as figure heads, name them as trustees and then
continue to operate outside their influence or authority. In most
cases, the trustees are not even part of the day to day
administration of the registered entity, as with a case where the
leader of the church or mosque is different from and more powerful
than the trustees. In many instances, the trustees themselves defer
to the leader, especially in matters of decision making. The major
challenge is that of mixing culture with law, where for instance,
it is deemed to be a taboo for the trustees to question the
decisions of the leader, which in most cases are taken under
spiritual cover. So, you have a case where some of the branches
have acquired land or other assets in their own branch names and
have built mighty mansions thereon, in the name of the branch. The
Courts have been very emphatic that such assets are as good as
wasted or having no owner, as a non-registered entity cannot claim
to acquire or own any asset in law.

The technical point to note is that all things must be done in
the specific name of the ‘incorporated trustees’ and not any other
name or entity. According to the learned authors of Webster’s
Dictionary, “Incorporation” is defined to mean ‘to unite closely or
so as to form one body, to form into or become a corporation.’ On
the other hand, registration means: ‘1. the act of registering 2.
an entry in a register 3. the number of persons registered 4. a
document certifying an act of incorporation.’

The church or mosque becomes incorporated by virtue of its
registration and acceptance. In most cases, the name retained for
the church or mosque is ‘Registered Trustees’, instead of
‘Incorporated Trustees’. Section 591 of CAMA makes provision for
the method of application as follows:

‘(1) Application under section 596 of this Act shall be in the
form prescribed by the Commission and shall state-

(a) the name of the proposed corporate body which MUST contain
the words ‘’Incorporated Trustees of’’.

What this then means is that there is no name as ‘Registered
Trustees’ under Part C of CAMA which would confer legal personality
on such entity, to acquire assets in the name of or to sue or be
sued in its corporate name. In law, there is a world of difference
between ‘Registered Trustees’ and ‘Incorporated Trustees’ and both
of them cannot be used interchangeably. Part C of CAMA only
recognize ‘Incorporated Trustees’, and as such, any other
description goes to no issue at all and will not be countenanced by
law. In the case of Amasike v. Reg.-General, C.A.C., the Supreme
Court upheld this position of CAMA, when it stated that for an
association to be registered under Part C of CAMA, the name of the
proposed body must contain the words “Incorporated Trustees’’.
Similarly in the case of Registered Trustees of the Church of the
Lord (Aladura) v. Jacob Konah Sheriff, the court in interpreting
section 673 (1) & (2) of the Companies and Allied Matters Act,
1990, which is a similar provision with the provisions of sections
590 and 591 of Companies and Allied Matters Act, 2004 stated as
follows:

“There is no gainsaying the fact that the primary purports of
the foregoing provisions of the 1990 Act are the need for
registration of a religious body among other designated bodies by
the Corporate Affairs Commission. Upon such registration, the
religious body shall be known and addressed with the prefix
‘’Incorporated Trustees of …’’

In the above cited case, the court went further to hold that the
names, The Church of the Lord (Aladura) and the Church of the Lord
(Aladura) Victory Chapel had common disabilities because none of
them was registered in accordance with the provisions of sections
673 and 674 of the 1990 Act and that neither of them can sue and be
sued in order to protect the proprietary interest of their
organizations. Sections 673 and 674 of the 1990 Act have similar
provisions with sections 590 and 591 of the Companies and Allied
Matters, Act 2004. This is surely not a matter of semantics, as the
provisions of CAMA in this regard speak of a binding legal
obligation to recognize the registered entity as ‘Incorporated
Trustees’ only. No other name or description will suffice. The two
scenarios that must be addressed urgently by all churches and
mosques are: (i) illegal acquisition of assets by and in the name
of their branches, and (ii) acquisition of assets in the unknown
name of ‘Registered Trustees’. Good enough that both situations can
be and should be addressed by all entities concerned in order not
to run foul of the law. In a matter in which the writer was
involved up to the Supreme Court recently, the Court dismissed a
case that had been tried since 1984, from the High Court, to the
Court of Appeal and finally to the Supreme Court, mainly because
the property concerned was acquired in the name of the branch of a
church and the suit itself was filed in the name of the said
branch, which the Supreme Court held to be unknown to law. To be
forewarned, is to be forearmed, as they say.

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