Disputed Debt: Honeywell Is Not Indebted To Ecobank, Says Court
…We Are Appealing The Judgment–Ecobank
A Federal High Court sitting in Lagos today, held that Honeywell Flour Mills Plc and its sister companies; Anchorage Leisures Limited and Siloam Global Limited are no longer indebted to Ecobank Nigeria Limited.
Justice Ayokunle Faji made the declaration today while delivering judgement in a suit filed by Honeywell Group against Ecobank Limited.
Following a dispute over an alleged indebtedness of N5.5 billion to Ecobank Limited, Honeywell Group and its sister companies instituted a suit seeking court’s declaration that they were not indebted to Ecobank, contrary to the bank’s claim that they were indebted to it to the tune of N5.5 billion.
The companies have urged the court to hold that having made a “full and final” payment of N3.5 billion, as agreed at the July 22, 2013 meeting, they were no longer indebted to the bank.
But the bank insisted that in paying the N3.5 billion, the firms did not comply with the terms of agreement.
It contended that the firms breached the agreement that the money should be paid before the examiners from the Central Bank of Nigeria, who were in the bank to examine its books, would leave.
But the firms contended that the bank failed to inform them when exactly the CBN examiners were to leave, adding that it made the final payment on December 12, 2013.
In his judgement today, Justice Faji ruled in favour of Honeywell and its sister companies, holding that they were no longer indebted to the bank based on the exhibits placed before the court by the defendant
Justice Faji in his judgement said Ecobank did not give any update about the actual time limit for the repayment of the loan”.
Based on the agreement reached between the parties, the plaintiffs are no more independent to the defendant” the court held.
The judge further said that “I have looked through all the exhibits placed before the court, letters sent by plaintiffs to defendant about the remittance and the money the defendant ate talking about now did not feature in the letters to the plaintiffs”.
The judge also awarded a cost of N250,000 against the bank in favour of Honeywell and its sister companies.
In a swift reaction to the judgment, Ecobank Nigeria Limited through a firm, Specialized Resolution Company, which took over the disputed Honeywell loans said its set to appeal the judgement delivered by Court, on the protracted N5.5 billion legal suit between Honeywell and its client.
The ETI Specialized Resolution Company Ltd (ESRC), a Recovery resolution vehicle of the Ecobank group will fully prosecute the appeal as it strongly disagrees with the decision of the court.
The main purpose of ESRC is to pursue and recover all outstanding loan obligations of customers whose loans were sold to the company. It has indeed made appreciable progress in this regard.
ESRC said it will appeal the judgement as same did not take into consideration salient facts put before the court. In the view of ESRC, a debtor should be made to pay its full debt having failed to pay as and when agreed.
A spokesperson for ESRC said that the company will pursue recovery of the debts owed by the Honeywell companies to the logical conclusion through the courts, as return of depositors’ funds is key to ensuring the sanctity of agreements and viability of continued support and growth of local businesses by Banks.