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Cynthia Charles

Ecobank seeks to appeal ruling in bankruptcy case against Otudeko

Ecobank

 – Honeywell Group chair opposes application

Ecobank Nigeria Limited has applied to the Court of Appeal in Lagos for extension of time to enable it seek leave to appeal a ruling by Justice Babs Kuewumi of the Federal High Court in Lagos in a winding-up petition against chairman of Honeywell Group, Oba Otudeko.

The bank initiated the bankruptcy proceedings against Otudeko over an alleged N5.5billion debt by virtue of loan facilities availed Honeywell Flour Mills Plc, Siloam Global Services Limited and Anchorage Leisures Limited, said to have been personally guaranteed by Otudeko.

The appellant is seeking an order by the Appeal Court granting it leave to appeal the ruling delivered last February 19.

The ruling followed the winding-up petition filed by Ecobank on October 17, 2015, accompanied by motion ex-parte and motion on notice.

The bank said the petition was a bid to recover the money from Otudeko “considering  the looming and impending danger of having its banking licence withdrawn after the respondent failed to liquidate its indebtedness after several demands.”

Justice Okon Abang, who first handled the case, asked the bank to put the respondent on notice to show cause. After being put on notice, Otudeko filed a motion on notice seeking to dismiss/strike out the petition.

Justice Kuewumi, who took over from Justice Abang, ruled that he would accord higher priority to Otudeko’s motion on notice ahead of other pending applications.

Dissatisfied with the ruling, Ecobank appealed. The Court of Appeal, last October 21, struck out the appeal on the basis that the appellant did not first obtain leave of the lower court before appealing.

The bank is, therefore, seeking for reliefs to enable it invoke the Court of Appeal’s jurisdiction to entertain the appeal.

“The applicant (Ecobank) ran out of time to appeal as a result of the previous proceedings in suit no CA/L/227/16 which was not determined on the merit as a result of failure to procure the needed leave.

“The leave of this court is required to extend time to obtain leave of court to appeal the ruling of lower court. It is in the interest of justice that this application be favourably considered and granted accordingly,” the bank prayed.

The bank, through its lawyer Mr Kunle Ogunba (SAN) is seeking a receiving order against Otudeko’s estate, funds, investment and shares in Honeywell Group, Honeywell Flour Mills, among other companies, as well as an order declaring him bankrupt.

Ecobank prayed for an order commanding Otudeko to immediately avail it the companies’ statement of affairs as well as net worth and other credible financial details as required by the Bankruptcy Act.

It asked for a consequential order empowering the bank to sell Otudeko’s properties wherever they are situated, as well as an order enabling it to utilise the investments or shares in companies in which Otudeko has interest.

In a motion on notice, Ecobank, among others, is also seeking an interlocutory order appointing a special manager and receiver over Otudeko’s assets.

But, Otudeko, in its counter-affidavit sworn to by Omolade Adeyemi, has urged the Court of Appeal to refuse Ecobank’s application.

He said the bank had prosecuted the subject-matter of the appeal and judgment had been given in which the Court of Appeal upheld his preliminary objection and struck out appeal.

The respondent said the appellate court also attended to the appeal on its merits, considered arguments by parties and affirmed the correctness of Justice Kuewumi’s ruling.

“It is in the interest of justice to refuse the applicant’s application,” Otudeko said.

In the lower court, the Honeywell Group’s chairman said the alleged debt “is neither ascertained nor undisputed.”

He added that Honeywell Four Mills and its sister companies commenced a suit against the bank before another judge “owing to disagreements between it (Honeywell) and the respondent (Ekobank) as to the complete liquidation of their outstanding obligations to the respondent having regards to the terms and condition of the credit facility.”

 

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Categories: BANKING
Cynthia Charles: She is a prolific writer and has special interest on writing about business and opportunities. She can be contacted via cynthiaadigwe@financialwatchngr.com
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