The Plaintiff/Respondent was granted a banking licence No, 000039 dated 10 June, 1988 by the first Defendant. By a Statutory Instrument [S.1.6 of 1995] dated 29 June, 1995, the first Defendant with the approval of the Head of State revoked the said licence. The apparent reason for the revocation was that the Plaintiff bank was in a grave financial condition which has "culminated in the total erosion of its capital base and the dissipation of the depositors' funds resulting in the inability of the bank to meet its obligations to its depositors and creditors, and the various actions taken by the regulatory authorities to halt further deterioration, including calls on the shareholders to recapitalise the bank, have failed." This is undoubtedly a very strong reason to which the Respondent should normally equally react without delay.

The appointment of the second Defendant/Appellant as the provisional liquidator of the bank was simultaneously announced. The fact of the revocation and the appointment of a provisional liquidator was published as Government Notice No.16 in Extraordinary Federal Republic of Nigeria Official Gazette No. 10 Vol.82 of 30 June, 1995. The first defendant claimed to have acted under section 12 of the Banks and Other Financial Institutions Decree No.25 of 1991 (BOFID).

The Plaintiff then instituted an action in the Federal High Court on 11 July, 1995 against the Defendants seeking (1) a declaration that the revocation as published "is capricious illegal null and void as same is based on a cause not cognisable under section 23 of the Banks and Other Financial Institutions Decree 1991"; (2) a declaration that the appointment of the 2nd Defendant as the provisional liquidator of the Plaintiff bank is illegal and contrary to section 38(3) of the said BOFID; (3) an injunction restraining the Defendants from giving effect to the revocation and acting pursuant to the said section 38. A motion on notice was filed the next day for an interlocutory injunction. In a ruling given on the preliminary objection on 15 August, 1995, Ukeje, J. found that the revocation was properly done under conditions envisaged by section 12 of BOFID and that by section 49 thereof no action shall lie against the Defendants. She dismissed the action restraining the Defendants from giving effect to the revocation by presenting a petition for winding-up and/or by selling or in any way disposing of any of the assets of the Plaintiff.

The Plaintiff appealed and the 2nd Defendant cross-appealed to the Court of Appeal. The Court of Appeal, Lagos Division, in a considered judgment dismissed the cross-appeal and allowed the appeal. It ordered that the case be remitted to the Federal High Court to be heard denovo. Dissatisfied with the Court of Appeal's judgment, the 2nd Defendant/Appellant appealed to the Supreme Court.