Bank Sues Zamfara State Over N3.2b Debt | Independent Newspapers Limited
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Bank Sues Zamfara State Over N3.2b Debt

Posted: Jul 10, 2015 at 12:00 am   /   by   /   comments (0)

By Tunde Opeseitan,  Lagos

Ecobank Nigeria Limited has urged a Federal High Court in Lagos to transfer to the undefended list, a suit it filed to recover an alleged debt of N3.2 billion from Zamfara State Government.

The bank, which claimed that the state had been owing it the said money since 2009, argued that Zamfara State had no reasonable defence to the suit, hence the prayer to transfer it to the undefended list.

In a motion ex parte filed pursuant to Order 12 Rules 1 and 2 and Order 26 Rule 26 Rule 3 of the court’s rules, the bank, through its lawyer, Kunle Ogunba, said it was convinced that “there is no sustainable defence or any defence at all on the part of the defendants to the suit of the plaintiff.”

In a 29-paragraph affidavit filed in support of the application and deposed to by one Oluwafunmilola Salami, the bank claimed that the refusal of Zamfara State to pay the alleged debt “is injurious to the plaintiff in its business as a custodian of third party’s funds.”

According to the deponent, the state had in May 2009 obtained a loan of N1.5bn from the defunct Ocean Bank Plc, which was later consolidated with Ecobank.

Salami added, “I am perfectly aware of the fact that the major security for the disbursement of the said loan facility was the Irrevocable Standing Payment Order from the state government’s VAT account domiciled then with the First Bank of Nigeria Limited, Gusau branch.

“The facility however suffered a setback when First Bank of Nigeria Limited stopped the warehousing of the state Federation Account Allocation Committee and consequently declined further remittance for the payment of the indebtedness that arose from the subject facility.”

The trial judge, Justice Okon Abang, while adjourning the matter till today, Friday, July 10, 2015, to take all pending applications, said there would be no further adjournment in the matter.

The judge noted that the defendants had taken steps contrary to the provisions of Order 12 under which the plaintiff filed the suit, asking for transfer to the undefended list.

As opposed to the ruling of the court that the only right that the defendants had was to file a notice to defend the suit, the judge said the defendants had filed a preliminary objection challenging the court’s jurisdiction.

But Abang said since the defendants had filed the objection, though in contravention of the rule, he was bound by law to first look at it, saying whether or not, he will grant their prayers was another thing.

The judge said, “I have already ruled on this issue that under the undefended list proceedings, the defendants are not allowed to file any other process other than a notice of intention to defend the suit.

“But instead, the first to third defendants went out of what the law provides and filed a notice of preliminary objection, which is not what the law says.

“Notwithstanding, it is still a court process in the court’s file which the court is bound to look at, the outcome is another thing.”

Abang said that since the defendants’ papers were staring him in the face, they could not be ignored and directed the plaintiff to immediately file its response to the issues raised by the defendants in their preliminary objection, so that the issues can be addressed on Friday.

“I am only bending backwards to accommodate the defendants because they have made an attempt to take the proceedings outside the undefended list rule.

“The plaintiff will file its reply to the jurisdictional issue raised by the defendants today. No further adjournment shall be entertained in this matter, “ Abang held on Thursday.