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By Lukman Olabiyi
Justice Dehinde Dipeolu of the Federal High Court, Lagos, has ordered a bank to pay the liquidator of Addy Finance & Investments Limited (in liquidation) the sums of N39,108,417 and $53,078.04, with pre-judgment interest at 20% and post-judgment interest at 10% per annum.
The court,also directed the bank to deliver certified statements of account covering the period from November 2, 2021 (the commencement of the company’s winding up), to the date of the judgment.
The ruling, followed an application by the liquidator in the winding-up suit FHC/L/CP/1577/2021: Nduka Nwabuwa & 3 Ors v. Addy Finance & Investments Ltd.
The application sought recovery of the company’s funds held by the bank and delivery of its account statements under Sections 576, 577, and 603 of CAMA 2020 and the Companies Winding-Up Rules 2001.
The liquidator’s counsel, T.Y. Salman, argued that the bank unlawfully withheld the company’s funds, despite court orders restraining withdrawals since March 30, 2022, and the appointment of a provisional liquidator on July 5, 2022.
The liquidator had relied on the bank’s own affidavit in earlier proceedings, which showed that the company’s accounts with UBA held balances of N30,455,571.65, N8,652,845.56, and $53,078.04 at different dates.
Justice Dipeolu found that UBA failed to comply with its obligations and attempted to rely on garnishee orders and interim forfeiture orders obtained after the winding-up commenced, which are void under Section 577 of CAMA 2020.
The court also noted the bank’s inconsistent conduct, including:Filing a sworn statement in November 2023, denying the existence of funds, while simultaneously negotiating and paying over N27 million to some of the company’s creditors in a separate suit, without disclosing the winding-up order or the appointment of a Liquidator.
Failing to serve critical documents (Exhibit ATO 6) on the Liquidator until after the consent judgment and payments had been made.
Entering settlement terms and disbursing company’s funds, where the bank’s staff received N16 million without involving the company or the EFCC.
The court held that the bank, as custodian of the company’s accounts, bore the burden of proving that the balances did not exist, and that equity would not assist a party at fault. The court also condemned the professional conduct of the bank’s counsel.
Accordingly, Justice Dipeolu granted the Liquidator’s reliefs, ordering the bank to pay N30,455,571.65 (balance as of December 1, 2022), N8,652,845.56 (balance as of March 1, 2023), and $53,078.04 (balance as of March 1, 2023),
The court also directed the respondent to deliver certified statements of account from November 2, 2021, to the date of the ruling.
However, the court declined to grant one of the Liquidator’s reliefs on the grounds of vagueness.
