A Court of Appeal in Lagos has directed Chief Judge of the Federal High Court, Justice Ibrahim Auta, to re-assign a winding-up petition by Ecobank Nigeria Limited against Honeywell Flour Mills Plc.
Justice Abimbola Obaseki-Adejumo said justice demands that both sides must be heard. She made no order as to cost.
The justice upheld an appeal by Honeywell against an ex-parte order made by Justice Mohammed Yunusa last December 4.
The company appealed against partial freezing of its accounts following an application by Ecobank’s lawyer Mr Kunle Ogunba (SAN), an insolvency expert.
Justice Yunusa had restrained Honeywell Group’s chairman, Dr Oba Otukedo, the company’s directors and subsidiaries from withdrawing from any bank or financial institution.
But Honeywell, through its lawyer Chief Wole Olanipekun (SAN) sought to discharge the order.
Justice Yunusa, in his ruling, on the application to discharge the order, held that the company could withdraw up to N60million in a month (N15million only per week) pending when the suit was heard and determined to enable Honeywell Group meet its financial obligations.
Dissatisfied with the ruling, Honeywell appealed, insisting that it wants full access to its funds. The suit is sequel to an alleged N3. 5 billion unpaid loan facility which Ecobank gave Honeywell.
Justice Obaseki-Adejumo said Justice Yunusa made the ex-parte order without notice to Honeywell. She said it violated the rules guiding winding-up petitions.
According to her, the rules state that every application in such a petition shall be by motion on notice to the person against whom the order was to be made.
“Justice of the case demands that both side be heard. The ruling of the Federal High Court is hereby set aside. The petition shall be assigned to another judge for necessary action. Parties shall bear their costs,” she held.
Ecobank had also appealed a ruling by Justice Mohammed Idris striking out contempt proceedings initiated against it by Achorage Leisures Limited and its sister company Siloam Global Services Limited, both of which are subsidiaries of Honeywell Group.
They accused the bank of disobeying an earlier directive by the judge that all parties should maintain status ante-bellum, which the bank denied.
Justice Mohammed Idris had last August 10 made an order of interim injunction restraining the bank from publishing the plaintiffs’ name as debtors and ordered parties to maintain status quo pending hearing of the plaintiffs’ suit.
But Honeywell said while the suit was pending, Ecobank filed other suits before other judges in a bid to recover its debt from Honeywell Group and its chairman Oba Otudeko.
Honeywell’s lawyers, therefore, filed Form 48 and Form 49, urging the court to hold the bank in contempt.
But Justice Idris struck out the contempt proceedings on the basis that no proper service was effected on the alleged contemnors.
Ogunba had argued on appeal that Justice Idris ought to have dismissed the proceedings rather than striking it out (which means it could be re-filed).
But the appellate court upheld Justice Idris’ ruling, adding that “the court cannot dissipate energy on an issue over which it had no jurisdiction.”
In a third appeal, Ecobank had challenged the lower court’s jurisdiction, but Justice Obaseki-Adejumo upheld Justice Idris’ assumption of jurisdiction, adding that there was a banker-customer relationship between Ecobank and Otudeko which vested the judge with jurisdiction.
