Wether or not a financial institution, Access Bank Plc will get her request to take over a choice property, popularly known as All Seasons Plaza, located in the heart of Lagos at Lateef Jakande Road, Agidingbi, Ikeja, is a matter a few weeks to come as Lagos High Court has set October 18, 2011, to deliver a ruling on the matter.
Justice Morenikeji Obadina of a Lagos High Court gave the date following arguments for and against the move last week. While Messrs J.A. Badejo (SAN) argued against the bid, Kunle Ogunba (SAN) spoke in favour of the move in a legal battle involving the bank and an energy providing firm, Negris Group over billions of naira credit facility allegedly granted by the financial institution to Negris.
The property, registered as All Seasons Properties Company Limited, was said to be a sister company of Negris Group. It was said to have been used as a collateral for a credit facility in the sum of ₦2.6 billion granted by the bank to the firm.
In his argument, Negris’ counsel, Badejo, said that it would be premature for the court to agree with the prayers of the bank, since the matter was still at an interlocutory stage, urging the court to allow status quo to remain and ultimately dismiss the bank’s prayer. Essentially, Badejo said that the court should restrain the bank from tampering with the property in whatsoever manner.
But Ogunba for Access Bank urged the court to decide the interlocutory application in his client’s favour, arguing that since there was no controversy as to the fact that Negris was indebted to his client and that it gave the property as one of the collaterals. He contended that if the court should hold otherwise, the money of the bank’s customers was at risk, saying the only thing that could salvage it is for the court to order the take of the property.
Interestingly, prior the arguments, the tenants in the disputed property, represented by their counsel had appealed to the court that their application be taken alongside with the earlier two but the court turned that request down, saying the application was not ripe for hearing.
In its process, All Seasons Properties Company Limited, is seeking an interlocutory injunction restraining the defendant (Access Bank) by itself or its servants, agents or privies from selling, disposing, or dealing with its property on Lateef Jakande Street, Agidingbi known as All Seasons Plaza and covered by deed of assignment registered as 92/92/1941 in the Land Registry and an interlocutory order directing the parties to maintain the status quo pending the determination of the suit.
According to its affidavit, the plaintiff said that sometime in July 2008 the bank granted facilities to Negris Holdings Limited towards part funding the acquisition of the assets of Nigerian Newsprint Manufacturing Company Limited (NNMC). It said that it provided complimentary equity funds of N1.5b billion for the acquisition purpose.
All Seasons Plaza further said that it was the understanding of parties at the point of acquiring NNMC, that the primary liability for the debt would be transferred to NNMC, whose assets were said to serve as collateral for the credit facilities.
The plaintiff, however, said that in order to provide some comfort to the defendant, Negris Holdings Limited provided a “fill-the-gap” security cover pending the conclusion of acquisition and transfer of assets to Okipp Limited pursuant to which the claimant equally executed a tripartite legal mortgage over its property – All Seasons Plaza, adding that the understanding between the parties that the tripartite legal mortgage over All Season’s Plaza would be released upon the acquisition of the assets of NNMC.
Following the take over of NNMC’s assets, Negris said that it executed a tripartite legal mortgage and tripartite deed of all assets debenture over all the assets of the acquired assets of NNMC now Okipp Limited, which it said included the 422.03 hectares of land located at Oku-Iboku in Itu Local Government area of Akwa Ibom State and Gmelina Wood Plantation on 10.349 hectares of land at Ndon Eka Nkop, Usung Odot, Odukpani Local Government in Cross River State.
All Seasons Plaza said that it was surprised when it discovered sometime in 2009 that Access Bank was making the moves to perfect the tripartite legal mortgage over the former’s property. It is therefore urging the court to stop the bank from actualising this bid.
Going by the bank’s counter affidavit, by Kunle Ogunba & Associates, the offer letter of the facilities did not at any point state that the primary liability for the said debt would be transferred to any entity, corporate, body or otherwise, quoting the letter to have shown under the column for collateral, thus: Tripartite legal mortgage on property known as All Seasons Plaza on Lateef Jakande, Agindingbi Road, Ikeja, Lagos belonging to All Seasons Properties Limited.
Debenture/charge over all the assets of NNMC in liquidation acquired by Negris Holding Limited from the liquidator, Otunba Olusola Adekanola as detailed in the assets sale/purchase contract between NNMC in liquidation and Negris Holding Limited currently estimated at N5billion by valuation jointly carried out by Messrs Barin Epega & Co, Lagos and Messrs Samuel Bassey & Co, Calabar.
Access Bank said that there was no form of understanding existing or that existed between the parties in the suit as to the release of securities provided by Negris Holdings Limited for the advancement of the facility to it by the bank, adding that the securities pledged by the debtor could only be released upon the liquidation of the outstanding sum given and the accrued interest.
The defendant further said that NNMC and Okipp Limited were two separate and distinct companies
The bank accused the applicant and Negris of an intention to arm-twist it from the outset thereby refused to register the transaction at the Corporate Affairs Commission (CAC), Abuja, due to the refusal of the said Negris Holding Limited to get its directors sign the relevant documents required for the said registration and consequently frustrating the bank’s bid to retrieve its depositors funds stuck within their despicable labyrinth.
It is the position of Access Bank that being the secured creditor of Negris Holdings Limited, it has every right to perfect the security offered by latter to protect itself from the insolvency of the debtor.
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Source: The Guardian