The Supreme Court of Nigeria has delivered a judgment that has sent ripples across the country’s legal and commercial communities, reaffirming the fundamental right of a litigant to independent legal representation and sharply curtailing the powers of a receiver/manager in adversarial proceedings.
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The judgment, delivered on Friday, 10th April, 2026 in Suit No. SC/CV/48/2026 — Neconde Energy Ltd v. FBN Quest Merchant Bank Ltd & 4 Ors — was handed down by a five-member panel of the apex court comprising Justices Mohammed Lawal Garba, Emmanuel Akomaye Agim, Haruna Simon Tsammani, Stephen Jonah Adah, and Mohammed Baba Idris.
While the lead judgment was delivered by Justice Mohammed Baba Idris, JSC, it was the supporting judgment of Justice Emmanuel Akomaye Agim, JSC, that has captured widespread attention for its forceful condemnation of the procedural manoeuvre that triggered the appeal.
In a strongly worded pronouncement, Justice Agim described the application that led to the disqualification of Chief Wole Olanipekun, SAN and other counsel as “a scandalous and despicable engagement in the gross abuse of the process of court,” declaring further that “the Court of Appeal abdicated its judicial responsibility and enabled a blatant abuse of the process of court when it granted that application.”
The dispute originated from a complex commercial transaction in which Nestoil Limited, the 3rd respondent, became indebted to a consortium of banks comprising Access Bank PLC, Union Bank of Nigeria PLC, First City Monument Bank PLC, Ecobank Nigeria Limited, United Bank for Africa PLC, Zenith Bank PLC, and African Export-Import Bank, in separate bilateral transactions coalesced under a Common Terms Agreement dated 8th December, 2022.
Under the said agreement, Neconde Energy Limited, the appellant, charged its interest in OML 42 JV — an oil well — together with its assets, as security for the debts pursuant to a Deed of Charge executed between the appellant and First Trustees Limited (the 2nd respondent), which acted as agent of the consortium of banks.
The 4th and 5th respondents, Ernest Azudialu-Obiejesi and Nnnena Azudialu-Obiejesi, were said to have further guaranteed the 3rd respondent’s repayment of the debts and pledged their assets as collateral.
Pursuant to an alleged default in repayment, the 2nd respondent appointed Mr. Abubakar Sulu-Gambari, SAN as receiver/manager by a Deed of Appointment dated 21st August, 2025, which appointment was duly registered with the Corporate Affairs Commission.
Following the appointment, FBN Quest Merchant Bank Ltd and First Trustees Limited (the 1st and 2nd respondents) instituted proceedings before the Federal High Court, Lagos Judicial Division against Neconde Energy Ltd, Nestoil Ltd, and the Azudialu-Obiejesis as defendants.
On 20th November, 2025, the trial court ruled that an ex parte mareva order against the appellant and the 3rd to 5th respondents had lapsed after 14 days in the absence of a subsisting order on notice — a decision which prompted the 1st and 2nd respondents to appeal to the Court of Appeal on 21st November, 2025.
It was within that pending appeal that the controversial application emerged. Counsel appointed by the receiver/manager filed an application on 3rd December, 2025, seeking the disqualification of Chief Wole Olanipekun, SAN and other learned counsel appointed by the appellant and the 3rd to 5th respondents to represent them in the suit brought against them by the 1st and 2nd respondents.
The contention of the receiver/manager was that only he possessed the legal authority to appoint legal practitioners to represent the appellant and the 3rd to 5th respondents in the case.
The Court of Appeal granted the application, holding that upon the appointment of the receiver/manager, the company and its management had no power to appoint counsel to represent it in the suit, and consequently disqualified the legal practitioners appointed by the appellant and the 3rd to 5th respondents. It was that decision that triggered the appeal to the Supreme Court.
Delivering his supporting judgment, Justice Agim first addressed the preliminary objections raised against the appeal, holding that they had no basis. He explained that by virtue of Section 233(2) of the 1999 Constitution, the appeal lay as of right because the grounds involved questions of law alone, and the ruling of the Court of Appeal disqualifying Chief Wole Olanipekun, SAN and other counsel — though made at the interlocutory stage — was a final decision because it finally determined the right of the parties on the issue of disqualification.
Citing the leading authority of Igunbor V Afolabi & Anor (2001) LPELR-1454 (SC) held 3 & 4, the apex court restated that “a final order or judgment at law is one which brings to an end the rights of the parties in the action. It disposes of the subject matter of the controversy or determines the litigation as to all parties on the merits.”
The court further relied on the dictum of Karibi-Whyte, JSC, who held that “where the order made finally determines the rights of the parties, as to the particular issue disputed, it is a final order even if arising from an interlocutory application,” referencing decisions in Omonuwa V. Oshodin, U.B.A Plc. V Akinsanya, Ude V. Agu, Ojom V. Odunsi, and Western Steel Works Ltd V. Iron and Steel Workers Union of Nigeria.
Turning to the merit of the appeal, Justice Agim made what may prove to be one of the most consequential pronouncements of the judgment. He observed that it was the 1st and 2nd respondents — on behalf of their creditors — that filed the suit against the appellant and the 3rd to 5th respondents to enforce the Common Terms Agreement, the Deed of Charge over OML 42 JV, and to recover the debts due under the agreement.
“It is absurd,” he declared, “for a receiver/manager to appoint lawyers for the defendant (the debtor) in a suit by the receiver or the creditor as plaintiff. The scope of the power of a receiver/manager does not include the power to appoint legal representation for the opposing party. The power does not extend to controlling or representing adverse parties in litigation.”
The learned justice further explained that “for the same receiver or creditor to file a suit and also appoint legal representation for the opposing party involves a serious conflict of interest that would violate basic principles of fair hearing and independence of legal representation.”
He affirmed that “the appellant as defendant (debtor) has the independent right to choose and appoint its lawyer and this right cannot be controlled or exercised by the receiver suing it. There would be no equality of arms of the parties to a proceedings in which one party appoints the lawyer for the opponent. Without such equality of arms the proceedings cannot be fair and must be set aside.”
Justice Agim grounded his reasoning in the constitutional bedrock of fair hearing, holding that “the principle of equality of arms, a fundamental determinant of the fairness of a proceeding, guarantees that all parties in a legal proceedings have reasonable opportunity to present their case under condition that do not place them at a substantial disadvantage. This includes the fundamental right to choose a lawyer of a party’s choice. If a party is prevented from exercising this right, the fair hearing guarantee under Section 36(1) becomes illusory and the integrity of the judicial proceeding is destroyed.”
In what was perhaps the most stinging portion of the judgment, the justice expressed surprise that learned counsel for the 1st and 2nd respondents could contend that the appellant and the 3rd to 5th respondents — defendants to their own suit — had no power to appoint a lawyer of their choice for their defence simply because a receiver/manager had been appointed to recover the debts owed by them.
“Such an application,” he held, “cannot be in furtherance of justice and is clearly a scandalous and despicable engagement in the gross abuse of the process of court. The Court of Appeal abdicated its judicial responsibility and enabled a blatant abuse of the process of court when it granted that application.”
In the lead judgment, Justice Mohammed Baba Idris, JSC articulated what may emerge as the enduring principle from the case — that where a dispute touches on the legality, validity, or scope of a receivership, the company retains its residual authority to act through its directors. The pronouncement ensures that directors are not rendered entirely redundant upon the appointment of a receiver, particularly in contentious proceedings, but instead continue to play a role in defending the company’s legal interests.
The judgment also drew a critical distinction between asset control and corporate control, emphasising that while a receiver may assume management over specified assets of a company, that authority does not extend to extinguishing the company’s legal personality or stripping its directors of all residual powers, especially where the legitimacy or scope of the receivership itself is being challenged.
Bode Olanipekun, SAN appeared with Mofesomo Tayo-Oyetibo, SAN, Akintola Makinde Esq., Raymond Nkannebe Esq., Ope Muritala Esq., Rita Nmarkwe Esq., and Victoria Bassey Esq. for the appellant. Ame Ogie Esq. appeared for the receiver/manager. Victor Ogude, SAN led Omosanya Popoola, SAN, K. O. Fagbemi Esq., Bolaji Oyun Esq., Kehinde Wilkey Esq., and Buchi Ofulue Esq. for the 1st and 2nd respondents. M. B. Ganiyu Esq. appeared with M. Ilegbusi Esq. for the 3rd respondent. Chinonye Edmund Obiagwu, SAN appeared with Mariam Balony Esq., V. Chinazo Esq., E. Lumba Esq., and C. Obiagwu Esq. for the 4th respondent. Kehinde Ogunwumiju, SAN led C. Ojukwu, SAN, O. Osunleti Esq., C. Omokaro Esq., C. Mayor-Eze Esq., and U. C. Osuigwe Esq. for the 5th respondent.
Reactions to the judgment have remained divided across the legal community. Some practitioners argue that the Supreme Court merely restated settled law, noting that the principles of fair hearing and independent legal representation are well established in Nigerian jurisprudence. Others, however, view the decision as a watershed moment, particularly in its clear articulation of the limits of receivership within Nigeria’s legal framework and the firmness with which those limits were enforced.
JUDGMENT DELIVERED BY EMMANUEL AGIM, JSC IN NECONDE ENERGY LTD V. FBNQUEST BANK LTD & ORS TheNigeriaLawyerBeyond the immediate parties, the judgment is expected to significantly influence insolvency practice in Nigeria by reinforcing the right of debtor companies to retain counsel of their choice, clarifying the scope of a receiver’s authority, and reminding courts of their duty to guard against procedural manoeuvres that compromise fairness.
Ultimately, while the Neconde Energy judgment may be less about creating new law than about reinforcing existing principles with clarity and authority, it has undoubtedly strengthened the integrity of Nigeria’s adversarial system and sent a clear message that insolvency mechanisms must operate within the bounds of justice, not at its expense.
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