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CaseLaw

CBCLN V. Unibiz (2000) CLR 8(m) (CA)

Brief

  • Interlocutory application
  • Affidavit
  • Parties to an action
  • Court orders

Facts

Sometime in December 1996 the respondent granted to the appellant and one of its subsidiaries Messrs. Universal Agro Equipment and Supplies Limited overdraft facilities to the tune of N45 million. A floating debenture was executed in favour of the respondent as security for the facilities. Further a third party fixed deposit in the sum of N15 million, which was subsequently increased to N23.5 million belonging to another subsidiary of the appellant, namely Messrs. Bakalori Farms Limited, was pledged as additional security for the facility. Some of the stocks worth N7.525 million were subsequently sold and the proceeds of sale were remitted into the account of Messrs. Bakalori Farms Limited.

Sometimes in June the appellant and the respondent commenced negotiations with a view to liquidating the outstanding balance on the overdraft facilities. It would appear along the line, these negotiations never achieved the desired result. Whereupon the appellant and the sister companies jointly instituted suit No. LD/1978/98 between Unibiz Nigeria Limited and 3 others v. Commercial Bank (Credit Lyonnais Nigeria) Limited in the High Court of Lagos State against the respondent for a declaration inter alia, that the appellant be discharged from any liabilities in respect of facilities given by the respondent which facilities have since been liquidated.

Whilst the suit was pending in the High Court of Lagos State, it would appear, the respondent on 12/10/99 appointed one Mr. Babington Ashaye as Receiver and Manager of the appellant’s undertakings.

On 25/10/99 the respondent filed an Ex-parte originating summons for itself and on behalf of Mr. Babington Ashaye praying for the certain relief’s. On 26/10/99 the court below made the following orders pursuant to the exparte originating summons:

  • 1
    That the receiver is hereby directed to take such steps as may be necessary to realize the assets of the respondent with a view to paying its outstandings to the applicant bank.
  • 2
    That the respondent, its agents, privies and assigns including but not limited to its directors and officers is hereby restrained from doing anything that would prevent the receiver from performing his lawful duties as a receiver”.

On 1/11/99 the appellant appealed to this court against the orders of the court below; and also filed an application for departure from the rules to compile the record of appeal, stay of execution of the order of the lower court. On 10/11/99 when this motion was partly heard, this court granted the prayer for departure while the substantive appeal and prayer for stay of execution were set down for hearing on 3/2/2000/. We also ordered the appellant to file its brief of argument within 21 days while the respondent was given 30 days to file its brief. On 24/11/99 the appellant filed its brief.

Meanwhile, on 11/11/99, the appellant had instituted another action at the Federal High Court in Suit No. FHC/L/CS/1303/99: Between Unibiz Nigeria Limited v. Commercial Bank Credit Lyonnais Nig. Limited and Babington Ashaye; claiming thus:

  • 1
    "A Declaration that in so far as the 2nd defendant did not give to the plaintiff notice of his purported appointment on 30th June 1998 by the 1st defendant as receiver and manager of the plaintiff’s undertaking good will properties and assets the 2nd defendant is not entitled in law to rely on the said appointment to interfere with the undertakings and assets as well as the operations and management of the plaintiff.
  • 2
    A declaration that the purported appointment of the 2nd defendant on the said 30th June, 1998 as receiver and Manager of the plaintiff’s undertaking assets and good will is illegal, null and void.
  • 3
    A declaration that the purported appointment on 12thOctober 1999 of the 2nd defendant by the 1st defendant as receiver and Manager of the undertaking goodwill properties and assets of the plaintiff during the pendency of Suit No. LD/1978/98 between Unibiz Nigeria Ltd and 3 others v. Commercial Bank (Credit Lyonnais Nig) Limited is illegal, null and void.
  • 4
    An Injunction restraining the defendants whether by themselves, their servants, agents and or representative from interfering in any manner whatsoever with the undertaking goodwill properties and assets as well as the operations and management of the plaintiff/ company in pursuance of either of the aforesaid appointment made on 30th June, 1998 or the one made on 12th October, 1999”.

    • This suit which, inter alia, challenges the legality of the purported appointment of Mr. Babington Ashaye as receiver and Manager of the appellants undertaking is still pending at the Federal High Court, Lagos.

Issues

Whether in the circumstance of this case, the applicant’s application has merit...

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