Tuesday, 6 October 2015

Court orders Zamfara to pay N3.1b debt owed Ecobank

JUSTICE Okon Abang of the Federal High Court, Lagos, has ordered the Zamfara State government to pay a judgment sum of N3.159,017,940.71 to Ecobank Nigeria Limited, being it’s outstanding indebtedness to the bank.

Justice Abang gave the order while delivering judgment in a suit filed by Ecobank Nigeria Limited against the Zamfara State government.
Other defendants in the suit are Zamfara State’s Attorney-General, the state Ministry of Finance; Accountant-General of the Federation; Attorney-General of the Federation and Central Bank of Nigeria.

Ecobank Plc in a suit listed ‘undefended’, and marked FHC/L/CS/872/2015, had sued the Zamfara State government before the court over a loan of N1.5 billion obtained from Oceanic International Bank in May, 2009.

The bank in an affidavit in support of the suit deposed to by Oluwafunmilola Salami, a lawyer in the law firm of Kunle Ogunba and Associates, averred that Zamfara State government through the Ministry of Finance, had in the month of May, 2009, received an extended facility of N1.5 billion from Oceanic International Bank Limited, now consolidated with Ecobank Nigeria Limited.

The deponent averred that the major security for the disbursement of the said loan facility was a conditional Irrevocable Standing Payment Order (ISPO) from the state government Valued Added Tax (VAT) domiciled with the First Bank Plc. She added that the facility however suffered a set back when First Bank Plc stopped warehousing the state’s Federation Account Allocation Committee (FACC), and consequently declined further remittance for the payment of the indebtedness.

The deponent also averred that due to the above, an agreement was reached to restructure the debt in November 2010, such that Zamfara government was to honour rentals for few months. She added that the state government till date has not paid the rentals despite the fact that it was agreed upon.

The deponent further averred that upon the restructure, all relevant council and House resolutions were obtained by the bank alongside another Irrevocable Standing Payment Orders on the main Federation Account Allocation Committee account domiciled with the then Intercontinental Bank Plc, now Access Bank Plc. And that despite the restructure and the documentations as security between the bank and Zamfara State government in respect of the loan, Zamfara State government has failed and neglect to liquidate the indebtedness leaving a huge sum outstanding and yet to be liquidated.

As a result, counsel to Ecobank, Kunle Ogunba, approached the court for a judgment against Zamfara State government, the state’s Attorney-General and Ministry of Finance, jointly and severally in the sum of N3,159,017,940.71, being the outstanding indebtedness and yet to be liquidated sum on the facility.
He also prayed for an interest on the said sum at the rate of 30 percent per annum from March 1, 2013, till the day of judgment, and 10 percent rate per annum until final liquidation of the judgment.

The plaintiff also claimed the sum of N50 million as the cost for the prosecution of the suit. And an order directing the 4th to 8th defendants to deduct the judgment sum and interest thereon from the finance accruable to Zamfara State government from the federation accounts as well as an order directing the 2nd to 7th defendants to ensure the full and effectual compliance with the judgment of the court.

But Justice Abang, while granting all the plaintiff’s claims, only awarded the sum of N50,000 as the cost for prosecuting the suit against the 1st to 3rd defendants.

Guardian

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