The Court of Appeal, Lagos Division, has nullified the registration of the business name “KPMG Professional Services” by the Corporate Affairs Commission (CAC).
In a unanimous decision delivered by Justice Abdullahi Mahmud Bayero on Thursday, July 10, the appellate court granted all four reliefs sought by KPMG Nigeria (the applicant) against the CAC (1st Respondent) and KPMG Professional Services (2nd Respondent).
The court held that the registration of the 2nd Respondent’s name was improper and misleading under Section 662(1)(d) of the Companies and Allied Matters Act (CAMA) 1990, now Section 852 of CAMA 2020.
KPMG Nigeria, comprising its audit, tax, and consulting arms, had filed an originating summons in 2002 challenging the CAC’s registration of a new entity bearing the name “KPMG Professional Services” a name it argued was deceptively similar to its long-established identity.
The Federal High Court had earlier dismissed KPMG Nigeria’s case in 2005, citing an alleged merger between KPMG Nigeria and Akintola Williams Deloitte as reason the plaintiff could no longer assert rights to the name.
The lower court also upheld the counterclaim of the 2nd Respondent, ordering KPMG Nigeria’s name, to be struck off the register.
But, the Court of Appeal rejected that reasoning, describing the evidence of a merger as “inadequate and unsubstantiated.”
It ruled that newspaper articles relied on by the lower court were not sufficient proof of a legal merger, nor did they demonstrate that KPMG Nigeria had ceased to exist or relinquished its rights.
Justice Bayero stated that “It is only a merger agreement that can determine the nature and scope of the purported merger. What exists here at best is a functional collaboration or partial merger of only a component, KPMG Audit and even that is not proven by binding legal documents.”
The appellate court emphasized that KPMG Nigeria remained the first in time to register its business entities, including KPMG Audit (1969), KPMG Tax Consultants (1990), and KPMG Consulting. It further ruled that the CAC acted contrary to CAMA by allowing a similar name to be registered without first removing the earlier existing names from the registry.
“The Registrar cannot assign a business name already held by another entity. One cannot give what one does not have — nemo dat quod non habet,” the court held.
Accordingly, the Court of Appeal:
Declared that the 2nd Respondent, KPMG Professional Services, was not entitled to be registered with that name;
Ordered the CAC to remove the 2nd Respondent from its register and cancel the issued certificate;
Issued a perpetual injunction restraining the 2nd Respondent from carrying out any business using the name; and
Directed an inquiry into damages relating to profits earned under the contested name.
The counterclaim of the 2nd Respondent was dismissed in its entirety.
The two other judges on the panel – Abimbola Obaseki-Adejumo, who was the presiding justice, and A.M. Talba, member – concurred with the lead judgement.
The appellant, KPMG Nigeria, was represented by A.T. Oloyede, while Emmanuel Umoren represented the first respondent (CAC), and Ebun Sofunde, (SAN), was the lead counsel for the second respondent.
