The federal high court in Lagos has upheld the appointment of a receiver/manager by United Bank for Africa (UBA) Plc to recover debts owed by Stallion Group, affirming the bank’s right to take possession of properties pledged as security for the loans.
In a judgment delivered on Friday, Daniel Osiagor, the
presiding judge, ruled that the defendants did not dispute their indebtedness
to UBA but merely challenged the amount claimed by the bank.
The court consequently upheld the validity of the mortgage
arrangements, affirmed the liability of the guarantors and restrained the
defendants from diverting payments due to them from government agencies.
The judgment represents a major development in the
long-running debt recovery dispute, which began in 2023 when UBA instituted
proceedings against Stallion Nigeria Limited and several associated companies
over an alleged indebtedness of N156 billion.
In resolving the issues raised by the parties, Osiagor held
that the reconciliation of accounts between UBA and the defendants did not
extinguish the underlying debt or invalidate the bank’s right to enforce its
security.
The court also upheld the appointment of Romeo Ese as
receiver/manager, affirming his authority to take possession of the mortgaged
properties and seek protective orders to safeguard the assets.
It further dismissed an objection by Barbedos, the 12th
defendant, which had challenged the mortgage arrangements on the grounds that
its consent was required.
The judge held that the defendant had failed to establish
any proprietary interest in the mortgaged property and, therefore, had no legal
basis to insist that its consent should have been obtained before the mortgage
was created.
The court also resolved the issue of jurisdiction in favour
of UBA, affirming its competence to entertain the bank’s claims.
In another significant decision, Osiagor restrained the
defendants from diverting receivables accruing to them from government
agencies, effectively preventing them from frustrating the bank’s efforts to
recover the outstanding obligations through those payments.
All the issues submitted for determination were resolved in
UBA’s favour, with the court granting the reliefs sought by the bank.
The dispute dates back to October 2023, when UBA obtained
interim orders from the federal high court to enforce its security over assets
belonging to Stallion Nigeria Limited and its subsidiaries.
The properties affected by the earlier orders included
industrial and commercial assets in Lagos, Port Harcourt and Kano.
The bank had alleged that Stallion Group owed approximately
N156.03 billion, a claim that became the subject of litigation involving
several companies within the conglomerate and their guarantors.
In November 2023, Stallion Group disputed the bank’s account
of the debt controversy, maintaining that it had made substantial repayments
and was engaged in discussions over account reconciliation and restructuring.
The proceedings subsequently encountered procedural
disputes, including a request by counsel representing some of the defendants
for the case to be transferred from the court of Akintayo Aluko, who had
handled earlier applications.
The latest judgment strengthens UBA’s position in enforcing
the mortgage securities and pursuing recovery against the principal debtors and
guarantors.
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