There was no relief on Friday for oil services firm Nestoil Limited, Neconde Energy Limited and their principal owners Ernest Azudialu-Obiejesi and his wife, as the Court of Appeal disqualified their lawyers in the ongoing multibillion-dollar debt recovery dispute involving a consortium of banks.
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In a decisive ruling, the appellate court barred Wole Olanipekun (SAN) and Muiz Banire (SAN), alongside other lawyers appearing with them, from further representing Neconde Energy Limited and Nestoil Limited respectively in the high-stakes commercial litigation.
The court held that the Ernest Azudialu-Obiejesi-led board of directors lacked the legal authority to appoint counsel, having been divested of such powers following the appointment of a Receiver/Manager over the companies by the lending institutions.
Accordingly, the Court of Appeal granted the applications seeking the disqualification of Messrs Olanipekun and Banire, struck out all processes filed by their respective law firms, and ordered that they cease acting for the companies in the matter.
The appellate court maintained that the plaintiff that sued and appointed the receiver is the entity with the legal authority to appoint lawyers for the companies, not the board of directors whose powers have been suspended by the receivership.
Olanipekun had sought to represent Neconde while Banire was to hold a brief for Nestoil. Their authority was challenged by Ayo Olorunfemi leading Ame Ogie for Neconde and Ayoola Ajayi leading MB Ganiyu for Nestoil.
The Court of Appeal decision followed closely on the heels of a ruling by the Supreme Court, which last week ordered all parties in the dispute to return to the Court of Appeal to resolve the question of legal representation as a preliminary issue.
In that ruling, delivered by a five-member panel led by Justice Inyang Okoro, the apex court directed the Court of Appeal to determine the competence and authority of counsel appearing for the companies and to report back on January 26, 2026.
The Supreme Court also warned against what it described as frivolous appeals and technical manoeuvres in debt recovery matters, stressing that courts should not be used to delay repayment of legitimate debts.
The appeal to the apex court was filed by Nestoil, Neconde, and their promoters, Ernest Obiejesi and Nnenna Obiejesi.
The ruling comes against the backdrop of mounting debt obligations estimated at over $2 billion, owed by Nestoil and its affiliates to a consortium of lenders.
A federal high court sitting in Lagos had on October 22, 2025, issued an order of Mareva authorising First Trustees and its subsidiary, FBNQuest Merchant Bank, to take over the companies’ assets.
Justice D. I. Dipeolu issued the injunction against the defendants — Nestoil and its affiliate, Neconde Energy, as well as Azudialu-Obiejesi and his wife, Nnenna Obiejesi.
Dipeolu restrained dealings in the sum of $1,012,608,386.91 and N430,014,064,380.77 — representing the total indebtedness as of September 30, 2025.
Beyond these amounts, there were other debts personally guaranteed by Azudialu-Obiejesi, with over N366.8 billion, $61.2 million, $152 million, and N10.4 billion owed to Access Bank, First Bank and Zenith Bank.
Appearing for Ernest Azudialu-Obiejesi was Chinonye Obiagwu while Kehinde Ogunyumiju leading Ademola Abimbola and Chikasolu Ojukwu appeared for Nnenna Obiejesi.
Abubakar Sulu-Gambari is the receiver manager appointed by FBNQuest Merchant Bank Limited and First Trustees. They are represented by Babajide Koku, Victor Ogude, and Omosanya Poopola, leading Toheeb Ipaye, Kamaal Fagbemi, Kehinde Wilkey and Buchi Ofulue.
However, Nestoil and its principal promoters approached a federal high court to set aside the order of Mareva which was granted before the latter developments, indicating ongoing resistance to the receivership and debt recovery process.
The Court of Appeal’s decision on Friday effectively resolves the representation dispute identified by the Supreme Court and further strengthens the position of the lenders, represented by FBNQuest Merchant Bank Limited and First Trustees, in the ongoing enforcement proceedings.
With the disqualification of their former counsel and the striking out of existing court processes, Nestoil and Neconde are now expected to regularise their representation in line with the receivership framework as the matter continues.
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