The Federal High Court in Ikoyi, Lagos, has upheld the appointment of a receiver/manager by United Bank for Africa (UBA) Plc in its debt recovery proceedings against Stallion Group, affirming the enforceability of the mortgage security and the liability of guarantors for the outstanding obligations.
Justice Daniel Osiagor delivered the judgment on Friday, granting the reliefs sought by UBA and restraining the defendants from diverting receivables due to them from government agencies.
Osiagor noted that the defendants did not dispute their indebtedness to the bank but challenged the amount being claimed.
The Court observed that the Defendants did not dispute the existence of their indebtedness to the Bank but challenged the amount claimed.
The court held that the reconciliation of accounts between the parties did not extinguish or negate the underlying indebtedness.
In a major affirmation of UBA’s enforcement rights, the Court upheld the appointment of the Receiver/Manager and confirmed his entitlement to take possession of the mortgaged property and seek appropriate protective orders.
The Court dismissed objections raised by the 12th Defendant, holding that it had failed to establish any proprietary rights over the mortgaged property. Consequently, its consent was not required for the creation of the mortgage, and its objections were rejected.
The Court restrained the Defendants from diverting receivables due to them from government agencies, thereby reinforcing the Bank’s ability to protect its recovery interests.
The judgment also affirmed the liability of the guarantors, strengthening UBA’s legal position in pursuing recovery of the outstanding obligations.
The ruling is particularly significant for the enforcement of creditors’ rights in Nigeria, underscoring the legal validity of properly constituted security arrangements and the authority of duly appointed receivers to enforce creditors’ interests.
The judgment marks a major milestone in UBA’s efforts to recover its exposure to Stallion Group and safeguard the interests of the Bank and its stakeholders.
