WHETHER A REGISTERED BUSINESS NAME HAS A SEPARATE LEGAL PERSONALITY FROM ITS OWNER?

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WHETHER A REGISTERED BUSINESS NAME HAS A SEPARATE LEGAL PERSONALITY FROM ITS OWNER?

by Branham Chima.
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✓ DEFINITION(S):
• Business name: also known as a trade name or trading name, is the official name under which a business or company operates and conducts its commercial activities 

• Legal personality: refers to the recognition of an entity, such as a person or an organisation, as having the legal rights and obligations similar to those of a human being.

✓ ANSWER:
No. In Nigerian law, a registered business name is not a company. The registered business name has no separate legal personality from its owner. It thus, cannot be sued, nor can it sue.

Hear the Court in Obiamulu v. Ogwuego (2020) LPELR-51949(CA) per A.S. Umar, JCA, held in respect thus: ‘It has been settled as far back as 1887 in the case of SALOMON V. SALOMON & CO. (1887) AC 22 that an incorporated company has a distinct legal personality from its shareholders, owners and directors. It is not in doubt that "P.A. Ogwuche & Associates" was registered as a business name with the Corporate Affairs Commission (CAC) (see Exhibit Cat page 97 of the record of appeal). The case of ONUEKWUSI V. R.T.C.M.Z.C. (supra) relied on by Appellant's Counsel borders on the legal status of an incorporated trustee and its ability to sue and be sued separate from its trustees. Nowhere in the judgment did the Apex Court consider the legal status of a registered business name. A registered business name has no legal personality separate from its owner or owners, neither can it sue or be sued. Rather it is the proprietor or proprietors of the business name that will sue or be sued. If the matter over which the action is instituted concerns the business name, it will simply be indicated that the proprietor(s) is "trading under the name and style of ABC business name." This is what the cliche saying that a business name is not a separate legal entity refers to. See SLB CONSORTIUM LTD V. NNPC (supra). On the subject of juristic personality, see SOCIO-POLITICAL RESEARCH DEV. V. MINISTRY OF FEDERAL CAPITAL TERRITORY (2019) 1 NWLR (PT. 1653) 313; FBN PLC V. A.G. FEDERATION (2018) 7 NWLR (PT. 1252) 121; DAIRO V. REGD. TRUSTEES, T.A.D., LAGOS (2018) 1 NWLR (PT. 1599) 62. However, as the lower Court rightly held at page 10 of the additional record of appeal, the case is still sustainable because the Appellant's other Attorney who sued on behalf of the Appellant as plaintiff at trial is a natural person who can validly institute an action.’

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