FBN Holdings Explains Contempt Suit Against FirstBank Directors

FBN Holdings Explains Contempt Suit Against FirstBank Directors

SHARE:

Post Views: 108 The board of FBN Holdings Plc, on Friday explained how its commercial banking arm, FirstBank of Nigeria Limited, was dragged into what...

Market Makers Failed Us When We Needed Them Most, NSE Boss Laments
Economic Note: Looking Beyond Nigeria’s $46bn Foreign Reserves, By Cordros Capital
How To Resolve Nigeria’s Power Sector Challenges- Experts

The board of FBN Holdings Plc, on Friday explained how its commercial banking arm, FirstBank of Nigeria Limited, was dragged into what became a myriad of court cases in which the plaintiffs are claiming N122.53bn.
One of the myriads of cases instituted by the plaintiffs culminated in last week’s committal of First Bank of Nigeria’s chairman and Managing Director for contempt of court.
A statement by Seye Kosoko, company secretary of FBN Holdings, to the Nigerian Stock Exchange (NSE), in line with its post-listing requirements, explained that the June 6, 2018 ruling was given by Justice I.N. Buba of the Federal High Court, Lagos Judicial Division, in SUIT NO: FHC/L/NRJ/1/2018.
The case respects to an order by Justice Buba on June 14, 2010, in Suit No: FHC/PH/CS/231/2001 between Chief Isaac Osaro Agbara & 9 Ors. v. Shell Petroleum Development Ltd, Shell International Petroleum Ltd and Shell International Exploration and Production BV.
Kosoko assured the stakeholders that FirstBank could not have disobeyed any order when its directors were not ordered to perform any obligation, or an order made against it at a time defendants to the earlier judgment are not being held to be in contempt.
While reaffirming its faith in the Nigerian judicial system, the statement lamented the “constant, persistent and unprovoked use of judicial processes to intimidate, harass and threaten (it),” adding that it is unaware “of any law in Nigeria which allows the use of criminal contempt to enforce monetary judgments or obligations.
Kosoko explained that the plethora of suits began as one, dated August 5, 2010, wherein Justice Buba in Suit No: FHC/PH/CS/231/2001, directed Shell to provide a Bank Guarantee in respect of the judgment sum in the June 14, 2010 suit, comprising both special and general damages, comprising N1.772bn in Special Damages, and an interest for delayed Payment for five years from 1996 at Central Bank of Nigeria (CBN) deregulated Rate at 25% totaling N5.407bn. There was also an award of Plaintiffs’ Claim of 25% of the said sum till the date of Judgement and thereafter 10% of the Judgment debt till payment; and an award of Plantiffs’ Claim against the Defendant in punitive terms of General Damages of N10bn.
Shell appealed the decision but being a customer, got FirstBank to issue the guarantee and was obliged.
The Court of Appeal in No: CA/PH/396/2012, on October 23, 2013, struck out the said appeal, following which the appellant approached the Supreme Court in SC. 693/2013. While that was ongoing, an Undefended List suit and garnishee proceedings were commenced against FirstBank in Suit No. BHC/208/2013 and FHC/PH/CS/432/2013.
But FirstBank maintained that owing to Shell’s pending appeal to the Supreme Court, the Guarantee had not yet crystallised, whilst Chief Isaac Agbara & Ors., insisted that payment was due on the guarantee.
“While Suit No. FHC/PH/CS/432/2013 was struck out, judgment was given on the Guarantee dated December 12, 2012, by the High Court of Rivers State on 17th January 2014 enforcing the Guarantee given in respect of the cumulative sum of N80.344bn.
“Meanwhile, Shell’s appeal against the Court of Appeal decision which activated the Undefended List Suit in BHC/208/2013 and the Court of Appeal decision in CA/PH/29M/2014 succeeded and the Supreme Court set aside the Court of Appeal’s decision in CA/PH/396/2012. In the face of that decision, Chief Isaac Agbara & Ors., now contend that the decisions given in their favour enforcing the guarantee in BHC/208/2013 and CA/PH/29M/2014 are now academic and of no use.”
The statement noted that in the midst of the multiplicity of court cases, Shell filed an appeal to the Supreme Court in SC. 731/2017 and same has been scheduled to come up on October 16, 2018.
Even when that had not been heard, Chief Isaac Agbara & Ors., on June 8, 2017, began another Undefended List suit against FirstBank on the basis of the second decision of the Court of Appeal in the Rivers State High Court in Suit No: PHC/1583/2017, now alleging entitlement to the sum of N122.533bn on the Guarantee issued in the cumulative sum of N17.18bn.
Chief Isaac Agbara & Ors., on September 7, 2017, commenced a Winding Up Petition against FirstBank at the Federal High Court in Abuja to enforce the Guarantee against FirstBank, claiming entitlement to the sum of N122.533bn arising from the judgment of the Court of Appeal in Appeal No. CA/PH/29M/2014 which is on appeal to the Supreme Court in SC. 511/2017.
He filed another winding up Petition against FirstBank in the Federal High Court, Lagos Judicial Division, before Justice Aikawa on December 14, 2017, repeating verbatim the pleadings and content of their dismissed winding up petition by Tsoho J., arising from the same judgments of Buba J. earlier mentioned.”
Not satisfied, Chief Isaac Agbara & ors., on January 5, 2018, commenced garnishee proceedings before Alagoa J, of the Owerri Judicial Division of the Federal High Court, in respect of the same Guarantee. In the said garnishee proceedings which was later transferred to the Lagos Judicial Division and is also pending before Buba J., Chief Agbara & Ors., urged the court to enforce same in satisfaction of the judgment of Buba J. given on 14th June 2010.
Amidst the said garnishee proceedings, the same judgment creditors commenced contempt proceedings against the Chairman and Managing Director of FirstBank of Nigeria Ltd in Suit No. FHC/L/NRJ/1/2018 on March 19, 2018, before Buba J; by filing Forms 48 and 49 dated February 26, 2018 and March 2, 2018 respectively, following which FirstBank filed a preliminary objection and on the substantive subject of the contempt proceedings.
The statement assured stakeholders that no liability is due from it to Chief Isaac Agbara & ors. from the Bank Guarantee dated December 17, 2012, just as no law criminalises breach of an undertaking, how much more criminal liability for imprisonment upon such alleged breach.

COMMENTS

WORDPRESS: 0
DISQUS: 0