Court adjourns Union Bank’s N10bn suit against Petrocam

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Union Bank has sued Petrocam for failing to pay back Import Trade Facilities
Union Bank has sued Petrocam for failing to pay back Import Trade Facilities
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Union Bank has sued Petrocam for failing to pay back Import Trade Facilities
Union Bank has sued Petrocam for failing to pay back Import Trade Facilities

The Federal High Court in Lagos has adjourned till 23rd of May, 2019 to determine either debt recovery suit of N10,062,643,928.72 and $5,247,693,.83 filed before the court by Union Bank Plc against oil company, Petrocam Trading Nigeria and two others Mr. Patrick Ilo and Petrocam Trading Limited South Africa can be termed as abuse of court process or not.

In a statement of claim filed before the court by Union Bank Plc’s lawyer, Chief Ajibola Aribisala SAN, the bank averred that the business structure is such that while Petrocam Trading Nigeria had direct allocation for AGO importation, the company entered into joint venture agreement with interested companies that have PPPRA allocation for importation of petrol.

This is to assist companies that have allocations but lacks the needed funding to do their business thereby sharing both risk and reward with the company.

Consequently, in pursuance of the banker-customer relationship between
29 September 2014 and 21 April 2015, Union bank granted the company, Import Trade Facilities to finance the importation of petroleum products but Petrocam is yet to pay back.

Deal of the day

According to Union Bank, as at 10 January 2018, Petrocam Trading Nigeria Limited and its MD/alter ego of the company, Mr Patrick Ilo are indebted as follows: the sum of N10,062,643,928.82 and US$5,247,963.82 with interests still running at prevailing rate.

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The bank further averred that although the sum of N200 million was remitted into the opening account with the bank no explanation was made by the company on the failure to remit the whole sovereign debt notes FX and interest differentials or subsidy payments in the sum of N2,162,248,931,01 received from the Federal Government on the said  letter of credit finance by the bank before the account was abandoned by the company.

Consequently the bank claims against the defendants are as follows N10,062,643,928.72, and $5,247,693.82 with accrued interest and N20 million as the cost of instituting this action.

However, the defendants in their application filed and argued before the court by their counsel Mr Gboyega Oyewole SAN urged the court to dismiss or strike out the suit on the ground that, they have subsisting legal action against the bank on the same subject matter before the Lagos State High court.

He argued that the present suit amounts to abuse of court process.

In a counter argument and submission canvassed by Chief Aribisala, the bank contended that the suit does not constitute an abuse of court process to the one at the Lagos High Court filed by the defendants as parties, reliefs and issues are not the same.

He added that the cause of action is equally not the same.

While the suit filed at the Lagos State High Court is predicated on acts of gross negligence allegedly committed by the bank, the suit filed by the bank before the Federal high court is a debt recovery suit, therefore the institution of the suit at the Lagos State High Court by the defendants does not preclude the bank from bringing this action before this court, therefore in the interest of justice urge the court to dismiss the defendants’¬† application with heavy cost.

The case was adjourned till 23 May 2019.