By Francis Ajuonuma
United Bank for Africa (UBA) Plc has secured a major legal victory in its N156 billion debt recovery proceedings against Stallion Group and the Vaswani brothers, with the Federal High Court, Ikoyi, Lagos, resolving all issues in favour of the bank.
The judgment, delivered on Friday by Justice Daniel Osiagor of Court 6, Federal High Court, Ikoyi, upheld UBA’s claims and granted the reliefs sought by the bank in the landmark debt recovery suit.
The bank, in a statement on the judgment, said the court affirmed its jurisdiction to entertain the case and upheld the validity of the appointment of its Receiver/Manager, Romeo Ese.
A major aspect of the judgment was the court’s finding that the defendants did not dispute their indebtedness to UBA but only challenged the amount claimed by the bank.
The court also held that the reconciliation exercise undertaken by the parties did not extinguish or otherwise invalidate the underlying indebtedness.
In a significant affirmation of the bank’s recovery rights, the court upheld the appointment of the Receiver/Manager and affirmed his entitlement to take possession of the mortgaged property.
The court further held that the Receiver/Manager was entitled to seek protective orders necessary to preserve the assets and interests covered by the recovery proceedings.
It also affirmed the liability of the guarantors, strengthening UBA’s position in pursuing recovery of the outstanding obligations.
The judgment dismissed an objection by the 12th defendant after the court found that the party had failed to establish any proprietary interest in the mortgaged property.
Consequently, the court held that the consent of the 12th defendant was not required for the mortgage, effectively clearing another legal obstacle to the bank’s enforcement of its security.
In another crucial order, the court restrained the defendants from diverting receivables due to them from government agencies.
The order is expected to protect funds payable to the defendants and preserve potential sources of recovery for the bank pending the enforcement of the judgment.
With the court resolving all the issues in UBA’s favour and granting the reliefs sought, the judgment represents a comprehensive victory for the bank in its efforts to recover the outstanding debt.
The decision also has wider implications for creditor enforcement in Nigeria, particularly regarding the validity of security arrangements, guarantors’ obligations and the powers of duly appointed receivers in debt recovery proceedings.
The ruling reinforces the principle that a disagreement over the precise amount outstanding does not, in itself, invalidate an admitted debt or prevent a creditor from exercising lawful enforcement rights.
UBA’s appointed Receiver/Manager in the matter is Romeo Ese.
