By Anthony Nwachukwu
A Justice Tijjani Abubakar-led five-man panel of the Supreme Court has upheld the Court of Appeal judgement of May 21, 2019 in favour of Ecobank against Honeywell Flour Mills Plc and two others in their disputed N5.5 billion debt settlement.
Honeywell and sister-firms – Anchorage Leisures Ltd and Siloam Global Ltd, had claimed that they made a N3.5 billion final settlement of their reported N5.5 billion indebtedness to Ecobank, but the bank insisted that they were still in debt.
Last Friday, however, the Supreme Court panel upheld the arguments of Ecobank’s lawyer, Kunle Ogunba (SAN), and affirmed the judgment of the Court of Appeal, Lagos which set aside the decision of the Federal High Court, Lagos.
In the lead judgment, Emmanuel Agim stated: “I affirm the judgment of the Court of Appeal setting aside the decision of the Federal High Court granting the reliefs claimed by the appellants.
“I hold that the appellants’ claim at the trial court failed and is hereby dismissed. The appellants shall pay the cost of N1 million to the respondent. The cross appeal was subsumed in the argument of the main appeal. It is no longer relevant.”
Honeywell, Anchorage and Siloam had on August 6, 2015, sued Ecobank before the Federal High Court, Lagos over their repayment of the N5.5 billion debt.
They urged the trial court to declare that “having paid the sum of N3.5 billion in cumulative settlement of their total outstanding indebtedness (of N5.5 billion to Ecobank), they owed no further debt obligation arising from their banker-customer relationships.”
They also urged the court to hold that Ecobank “was obligated to issue letters of discharge, release collaterals by which the prior indebtedness was secured.”
They further prayed the court to compel Ecobank to update their status on the Credit Risk Management System Portal of the Central Bank of Nigeria.
However, Ecobank insisted that an agreement was reached between it and the three firms on July 22, 2013, “for a definite settlement of N3.5 billion to be paid in terms of N500 million immediately and the balance of N3 billion before the exit of the CBN examiners from” Ecobank offices.
Ecobank argued that the repayment agreement period was for six months as it rejected Honeywell and its sister-companies’ request to “pay the balance over a one-and-half-year period in three equal half-yearly instalments.”
Among others, the bank contended that the debt repayment agreement lapsed in August 2013.
