Brilla Energy Limited & Ors v. Asset Management Corporation Of Nigeria (AMCON)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

MUHAMMAD IBRAHIM SIRAJO, JCA (Delivering the leading judgment)

The 1st appellant was, at all times material to this case, the customer of the defunct Afribank Nigeria Plc.

The 2nd and 3rd appellants are the Managing Director/Chief Executive Officer and Executive Director respectively, of the 1st appellant. In the course of their business relationship, the defunct Afribank Nigeria Plc. at various times offered three separate credit facilities to the 1st appellant for its business undertakings.

The credit facilities were partly secured by, among other things, the personal guarantee of the 2nd and 3rd appellants to repay the full amount of the facilities plus accrued interest in the event of default by the 1st appellant.

According to the respondent, as at 10th November, 2010, the total outstanding on the said credit facilities stood at the sum of N1,474,343,833.83 (One billion, four hundred and seventy-four million, three hundred and forty-three thousand, eight hundred and thirty-three naira and eighty-three kobo) comprising of principal and accrued interest.

Following the expiration of the tenors of all the three facilities, Afribank formally called up the facilities and the 1st and 2nd appellants guarantee to repay the facilities but the debts remained outstanding and have not been repaid.

In the meantime, the said debt portfolio of the appellants was taken over by the respondent herein, Asset Management Corporation of Nigeria (AMCON) as a non-performing bank asset prior to the liquidation of Afribank.

AMCON has now stepped into the place of Afribank as the creditor, Afribank having divested itself of its rights over the said debt when it transferred same to AMCON, hence the institution of the suit at the Federal High Court, Lagos Judicial Division (the lower court) by AMCON in order to recover the outstanding debt. The suit of the respondent, as plaintiff, was filed under the undefended list, pursuant to the order for leave granted it by the lower court on 16/11/2012, pages 61 – 62 of the record of appeal.

The reliefs claimed by the respondent against the appellants, as defendants, are as follows:

1. The sum of N35,167,578.38 (Thirty-five million, one hundred and sixty-seven thousand, five hundred and seventy-eight naira and thirty-eight kobo) being the outstanding amount unpaid on the temporary overdraft facility as of February 25, 2010 and interest thereon at the rate of 19% per annum from February 26, 2010 until judgment and thereafter at the rate of 10% until total liquidation,
2. The sum of N614,730, 286.35 (Six hundred and fourteen million, seven hundred and thirty thousand, two hundred and eighty-six naira and thirty five kobo) being, the outstanding amount unpaid on the Trade Finance Facility as of February 25, 2010 and interest thereon at the rate of 19% per annum from February 26, 2010 until judgment and thereafter at the rate of 10% until total liquidation.
3. The sum of $2,367,797.46 (Two million, three hundred and sixty-seven thousand, seven hundred and ninety-seven United States dollars and forty-six cents) being the outstanding amount unpaid on the Short Term Loan as of February 25, 2010 and interest thereon at the rate of 19% per annum from February 26, 2010 until judgment and thereafter at the rate of 10% until total liquidation.
4. Cost of this action (inclusive of Solicitors fees) assessed at N5,000,000.00 (Five million naira).

On 16/11/2012 when leave to enter the suit on the undefended list was granted, the suit was adjourned to 19/12/2012 for hearing. The matter was not heard until 27/03/2013. On that morning of the hearing, i.e., 27/03/2013, the appellants filed a notice of intention to defend with an affidavit titled: defendants counter-affidavit disclosing a defence on the Merit., pages 65 – 69 of the record. The lower court proceeded with the suit and entered judgment for the respondent in terms of its relief before the court. See pages 70 – 74 of the record.

By a motion on notice dated and filed before the lower court on 08/05/2013, the appellants sought for an order of the lower court setting aside its judgment of 27/03/2013 and dismissing the respondents suit, on the ground that the writ of summons initiating the suit was incompetent, as same was neither signed by a Legal Practitioner nor the plaintiff, which renders the judgment of the lower court a nullity for want of jurisdiction.

The lower court heard the motion on 10/05/2013 and dismissed same in a ruling delivered the same date. It is against that ruling, which occupies pages 92 – 98 of the record, that the appellants appealed to this court through a notice of appeal dated 17/05/2013 and filed the same date, pages 99 – 103 of the record.

An amended notice of appeal was filed on 29/03/2022 and was deemed properly filed and served by an order of court made on 22/05/2023, shortly before the hearing of the appeal. In both the original and the amended notices of appeal, the reliefs sought by the appellant are for an order allowing the appeal, an order setting aside the judgment of the lower court and an order dismissing the respondents suit at the lower court.

Appellants brief of argument signed by Mrs. Ifeoma Esom was filed on 24/01/2018, deemed on 04/03/2019 and further deemed on 22/05/2023. Appellants also filed a reply brief on 18/10/2022 but deemed on 22/05/2023. Two issues were formulated in the appellants brief of argument for the determination of this court, thus: