Appeal Court Orders NICON Group To Pay N1.7b Debt To Ekobank

Appeal Court Orders NICON Group To Pay N1.7b Debt To Ekobank

The Lagos Division of the Court of Appeal yesterday dismissed an appeal filed by NICON Group of Companies Plc challenging a judgment delivered by Justice Chukwujekwu Aneke of the Federal High Court, which ordered it to pay Ekobank Plc N1.7billion.

The appellate court presided over by Justice Jamilu Yammama Tukur in an unanimous judgment held that NICON could not complain that its rights to fair hearing were breached because its counsel was present when Ekobank’s lawyer, Kunle Ogunba (SAN) argued the application at the lower court.

NICON, as part of its grounds for filing the appeal, argued that it raised a preliminary objection to the admissibility of certain unmarked and uncertified documents relied on by Ekobank, and that Justice Chukwujekwu Aneke had adjourned for ruling.

The court also argued that “It was the preliminary objection of the appellant that was argued and adjourned for ruling at the lower court and not the substantive suit.

"But, to the utter bewilderment of the appellant, on 5th of May 2014, the lower court, instead of delivering a ruling on the preliminary objection raised by the appellant, went ahead and gave judgment to the respondent as per its writ of summons, when the substantive suit was neither argued by parties nor heard by the court.”

Based on this argument, the appellant urged the Appeal Court to determine “whether entering summary judgment in favour of the respondent by the trial court in its ruling in respect of the preliminary objection filed by the appellant, without allowing the appellant to defend the suit on the merit does not amount to a gross violation of the appellant’s right to fair hearing.”

NICON also asked the appellate court to allow the appeal and set aside the decision of the lower court. 

But the appeal court resolved all the issues in favour of the respondent holding that “It naturally follows that the appeal should be and is hereby dismissed for lacking in merit.”

Two other justices – Rita Pemu and Chinwe Iyizoba – concurred. Justice Pemu said NICON neglected to deliver a written notice of defence and affidavit within the stipulated time by the rules of court.

“In the instant case, the appellant filed no written notice of defence and affidavit within the time stipulated by the rules of court, neither did he file any affidavit disclosing a defence, satisfactorily explaining his defence, to enable the lower court let him defend the suit. The lower court was therefore right in the circumstance to enter judgment.

“The ruling of Hon. Justice C.J. Aneke delivered on the 5th day of May 2014 in Suit No. FHC/L/CS/91/2014 is hereby affirmed. The appeal is dismissed by me and I abide by the consequential order made in the lead judgment including the order as to costs,” Justice Pemu held.

In the same vain, Justice Iyizoba held that,  “The learned trial judge rightly entered judgment for the respondent on the basis that there was no defence to the suit. I agree that the appeal lacks merit. I also dismiss it and abide by the consequential orders in the lead judgment.”

It will be recalled that, Justice Aneke, in the judgment, also ordered NICON to pay interest on the "cumulative indebtedness totalling N1,787,108,417.92" at the rate of 30 per cent per annum from November 28l, 2013 to judgment day.

It ordered that the interest rate on the cumulative debt shall be 10 per cent per annum after judgment until the debt was fully paid.

Justice Aneke also awarded N100,000 to the bank as cost incurred in the litigation. 

He ordered NICON to pay "the sum of N1,599,597,144.04 being the mutually agreed and subsisting indebtedness of the defendant to the plaintiff as per plaintiff's correspondence of April 5, 2012endorsed and covenanted to by Barrister Jimoh Ibrahim, the defendant's Chairman, prime mover, alter ego.

He also entered "judgment in the sum of N187,511,273.91 being the accrued interest thereon on the mutually agreed sum from April 30, 2013 till November 27, 2013 at the rate of 20 per cent per annum; interest on the cumulative indebtedness totalling N1,787,108,417.92 at the rate of 30 per cent per annum from November 28, 2013 till judgment (or sooner payment) and thereafter at the rate of 10 per cent per annum until the final liquidation of the judgment sum; cost of the sum of N100,000 in in favour of the plaintiff."

Ecobank had offered loan to NICON through a letter dated June 21, 2006. It had asked the court to dismiss NICON's preliminary objection to the suit which it instituted under Undefended List Procedure.

NICON's counsel, Chief Niyi Akintola (SAN), through his preliminary objection, contended that the court lacked jurisdiction to entertain the suit.

One of Akintola's grounds of objection was that the claimant had filled the request agreement with respect to recourse to arbitration as stated in the offering agreement dated June 21, 2006.

Akintola also maintained that the court lacked jurisdiction because the subject matter of the suit did not fall within the exclusive jurisdiction of the court.