Court orders bank to refund N112m to late Ogunde’s estate

By Lukman Olabiyi, Lagos

The Lagos State High Court, Tafawa Balewa Square has mandated Union Bank of Nigeria Plc to refund N112 million to the beneficiaries of the late Otunba Adedoyin Olaide Ogunde’s estate.

This order, delivered by Justice Ibironke Harrison, comes after 25 years of legal battles.

The court found that the sale of Ogunde’s property at No. 6, Moore Road, Ikoyi, Lagos, was conducted in bad faith and at a significantly undervalued price.

Consequently, Union Bank is required to repay N112 million to the claimants: Mrs. Olubunmi Ogunde, Master Olumuyiwa Ogunde, Miss Eniola Ogunde (a minor), Mrs. Yewande Ogunde, Atinuke Ogunde, Afolabi Ogunde, and Oyeniye Ogunde.

The lawsuit, filed under number LD/2624/1999, initially included defendants Olushola Ogunde, Olubunmi Ashiru, Kehinde Ogunde, Olayinka Madden (executor of Ogunde’s estate), the Probate Registrar of the Lagos High Court, and Union Bank of Nigeria. The claimants settled with the first to fifth defendants in January 2016 but continued their case against Union Bank.

Union Bank opposed an amendment to the claimants’ statement, arguing it was statute-barred. However, in May 2017, Justice Morenike Obadina dismissed this objection, allowing the amendment.

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The claimants sought a declaration that Union Bank’s sale of the property was in bad faith. Justice Harrison ruled that Section 33(3) of the Limitation Law allows beneficiaries to sue based on fraud, irrespective of the limitation period. Notably, many beneficiaries were minors at the time, granting them an additional six years beyond the standard 12-year limitation period.

The court determined that Union Bank, acting as a trustee for the deceased’s estate, failed to act in good faith. The property sale, conducted privately rather than by auction as instructed, was found to be significantly undervalued. Justice Harrison highlighted that the property, comprising nine luxurious flats and additional plots, was sold for N30 million, fully covering the deceased’s outstanding debt of over N14 million. Further sales of additional plots for N30 million each were also undervalued.

The judge noted a lack of transparency regarding the balance utilization after settling the debt, suggesting fraud and collusion. While the sales could not be overturned due to insufficient direct evidence of collusion by buyers, the claimants were entitled to damages.

Justice Harrison awarded the claimants N112,050,000.00, representing the properties’ estimated market value minus N60 million already paid by Union Bank. Additionally, the court ordered interest on the balance from 1998 until the judgment date at the prevailing Central Bank of Nigeria rate, and 10 percent per annum from the judgment date until full payment.

“The court finds the sale of the property at No. 6, Moore Road, Ikoyi, Lagos, by Union Bank, to be in bad faith and grossly undervalued. The beneficiaries are entitled to an award of general damages for the wrongful sale,” stated Justice Harrison.