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.
Justice Osiagor noted that the defendants did not dispute their indebtedness to the bank but merely challenged the amount being 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 judgment also affirmed the liability of the guarantors, strengthening UBA’s legal position in pursuing the recovery of the outstanding obligations.
This 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.
