UBA vs Borini Prono: Court stays execution of assets take-over

A Federal High Court sitting in Lagos south west Nigeria recently granted leave to a receiver /manager, Mr Olamide Owolegbon, appointed by United Bank for Africa (UBA) Plc to, as published on this platform on Tuesday, 19 November 2019, take over all fixed and floating assets of a limited liability company, BORINI PRONO. That is, wherever such assets are found and “whatsoever jurisdiction of the court and in Nigeria, particularly but not limited to all the assets of the company within its registered office, 11 Burma Road APAPA, Lagos.”

This happened because Borini Prono could not pay a debt of N768.6 million it owed (and still owes) UBA.

However, Borini Prono’s solicitors, F.A Dalley, Esq and W.A Esan, made a beeline for the Federal High Court, Lagos, on 14 November, 2019, asking for an order setting aside the interim order granted by the court on 21 October and its execution concerning the assets take-over. Specifically, they wanted the court to stop the appointment of Owolegbon as receiver manager for UBA in the assets take-over.

Of course, lawyers to UBA, T. Adamolekun, G. Akande-Peters and E. Ojo, trenchantly opposed Borini Prono’s application.

Just as hot knife would slice through butter, the Presiding Judge, C. J. Aneke, on 16 December 2019, made a ruling, granting Borini Prono’s prayers. It follows, therefore, that the appointment of Owolegbon as receiver manager for UBA in the assets take-over was set aside for now.

The judge adjourned the suit to 29 January 2020.

The conflict between Borini Prono and UBA came to the public domain in an affidavit sworn to by the bank’s head of loan recovery, Mr Adeyemi Wey, filed and argued before the court by a Lagos lawyer, Barrister Temilolu Adamolekun, explaining that the financial institution granted several loan facilities to Borini Prono to augment its working capital. As security for the various loan facilities, the company, as published earlier on this platform, executed the following documents:

1.A duly registered Deed of all Assets dated 6th of May, 2014.

2.Domicilliation letters in respect of contract payments,some of which the bank issued Advance Payment Guarantee for.

TheNEWS published further: “However the company failed to perform its obligations to the bank and failed to liquidate the facilities which continued to accrue interest and as at 31st May, 2019 the company’s indebtedness to the bank stood at N768.6 million.

Consequently, pursuant to clause 9 of the Deed of All Assets, the bank appointed Mr Olamide Owolegbon as Receiver/Manager over all assets of the company charged in favour of the bank.

The company and its directors will, according to the affidavit, likely obstruct, hinder and interfere with the powers vested in the Receiver/Manager as contained in the Deed of all Assets Debenture. Therefore, unless the company and its directors are restrained,they would strip the company’s charged assets and dispose same; thus leaving the bank without any means to recouping or realising the indebtedness of the company.

Consequently, Mr Adamolekun urged the court to issue an order granting leave to the Receiver/manager to take over the assets of the company,and an order directing the Assistant Inspector General of Police, Zone 2,Lagos State, the commissioner of Police Lagos, to assign seven policemen to protect Mr Owolegbon and his labourers. They are to assist the baiIifs of the court in the course of the receiver taking possession and carrying out his duties as receiver of the property of the company.

The presiding Judge, Chukwujekwu Aneke, after hearing the submission of Mr Adamolekun, acceded to his request.”