Wale Igbintade
The Federal High Court in Lagos has upheld the appointment of a receiver/manager by United Bank for Africa (UBA) Plc to recover an alleged N156.03 billion debt owed by Stallion Group, while restraining the defendants from diverting payments due to them from government agencies.
In a judgment delivered on Friday, Justice Daniel Osiagor upheld the validity of the mortgage arrangements securing the loans and affirmed UBA’s right to enforce its securities over the properties pledged against the facilities.
The judge held that the defendants did not dispute their indebtedness to the bank but challenged the amount claimed.
The court also affirmed the liability of the guarantors and upheld the appointment of Romeo Ese as receiver/manager, confirming his authority to take possession of the mortgaged properties and seek protective orders to safeguard the assets.
In another significant aspect of the judgment, Justice Osiagor restrained the defendants from diverting receivables due to them from government agencies, a measure aimed at preventing the diversion of funds that could facilitate the bank’s recovery efforts.
The court further 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.
Justice Osiagor also dismissed an objection by Barbedos, the 12th defendant, which challenged the mortgage arrangements on the ground that its consent was required before the transactions could be concluded.
The judge held that Barbedos 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 jurisdictional issue in UBA’s favour, affirming its competence to entertain the bank’s claims.
According to the proceedings, 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 securities 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.
UBA had alleged that Stallion Group owed approximately N156.03 billion, prompting 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 with UBA over account reconciliation and restructuring.
The proceedings subsequently witnessed procedural disputes, including a request by counsel representing some of the defendants for the case to be transferred from the court of Justice Akintayo Aluko, who had handled earlier applications.