The Court of Appeal, Lagos Division has set aside the judgment of the Federal High Court, delivered by Honourable Justice Ambrose Lewis-Allagoa made on November 3, 2021, in the receivership case of Algrain Foods Limited and take over of the private properties of its Managing Director, Chief Anthony Obidulu by Emmanuel Adeyeye Oyebanji, a Senior Advocate of Nigeria (SAN).
The assets were illegally taken over by agents of First City Monument Bank Plc., First Bank of Nigeria Limited and CSL Trustees Limited over a controversial loan deal which trial is still before a competent court.
The Company, Algrain Foods Limited through its Lawyer, Chief Aloysius C. Ezenduka had challenged the decision of the Fedral High Court at the Court of Appeal. In a unanimous decision by the Court of Appeal on Thursday 6th February, 2025, Hon. Justice Paul Ahmed Bassi who read the lead judgment held that the trial court erred in granting Mr. Emmanuel Adeyeye Oyebanji, who was not a party to the suit before the court, the right to take possession, remain in possession, continue to manage, superintendent and sell the assets of the Appellants (Algrain Foods Limited and Anthony Obidulu).
Reviewing the case before delivering judgment, Justice Bassi noted that on 19th March, 2020 in appeal No. CA/L/380/2018, the Court of Appeal had held that the Receiver Manager (Oyebanji) being a proper party in the suit was not joined and consequently set aside the trial Court’s decision and remitted the case back to the Chief Judge of the Federal High Court for hearing and determination before another judge.
Incidentally, the Court of Appeal order of 19th March, 2020 was not adhered to, by parties in the instant suit leading to the appeal.
According to the Court of Appeal justices, “the position of the law is to the effect that where proper parties are not before the Court, it affects the jurisdiction of the Court hearing the matter since it goes to the foundation of the Suit in limine. In effect, the court lacks jurisdiction to entertain or hear the case as buttressed in several cited cases like U.O.O. Nigeria Plc vs. Okafor & ors(2020), LPELR. 49570 (SC), Cotecna Int. Ltd vs. Church gate (Nig) Ltd & Anor (2010) 18 NWLR (pt 1225) 346 SC.
The Court of Appeal Justices concluded therefore, that since “the trial Court having determined the case without proper parties and without jurisdiction, this appeal succeeds and it is allowed.” Subsequently the Appeal Court made an order striking out Suit No. FHC/L/CS/06/2017 including all the orders made therein by the trial Court.
On 13th November, 2024 the Court of Appeal Justices Jimi Olukayode Bada, Danlami Zama Senchi and Paul Ahmed Bassi had sat to hear the appeal filed by Chief Obidulu against the Judgment of Hon. Justice A. Lewis Allagoa granting possession to the Receiver Adeyeye Oyebanji in which he asserted that as at the time FCMB appointed the Receiver, the All Assets Debenture the bank was claiming to enforce had not crystallized.
Since the debenture had not crystallized before the takeover, it therefore means that the takeover was illegal. If the takeover was illegal and they have been in possession since 2017, they have automatically denied Algrain Foods Limited income from its manufacturing business and similarly denied Obidulu revenue from his warehouses that ought to have generated income for him.
The company has remained sealed by the First City Monument Bank (FCMB) since June, 2017. The Algrain boss in earlier submissions had averred that the bank not only forged but concealed relevant documents pertaining to the Banker/Customer relationships with which it deceived the Court into granting the order on the basis of which they took over his company.
According to him, his company was one of the beneficiaries of the Federal Government’s intervention loans tagged Small and Medium Enterprises Credit Guarantee Scheme (SMECGS) in 2011. The company got a N100 million of the intervention fund through the bank (FCMB) because one of the conditions for getting the fund was that one must go through a commercial bank to access it. So Algrain opened an account with First City Monument Bank Plc., from where the fund was accessed with first draw down in 2013. But unfortunately, what Obidulu personally thought would boost his business and increase the company’s economic base, turned out to be one of his company’s worst economic decisions as a businessman.
The N100 million was guaranteed by the Federal Government of Nigeria to the tune of 80% (Principal and interest) with repayment tenure of 60 months and additional 24 months moratorium.
With the entire tenure therefore, spanning 84 months (seven years) final and terminal date of repayment ought to be November, 2020 in respect of which the Central Bank of Nigeria issued a Guarantee Certificate to First City Monument Bank Plc. dated 15th March, 2012 containing the afore-mentioned terms which the Bank concealed from the Federal High Court in securing the judgment being relied upon in taking over the company.
In November 26, 2024, the case filed by the Algrain boss, Chief Anthony Obidulu against FCMB came up at the Lagos High Court, Osborne Foreshore Estate II with counsel to FCMB, Prof. Taiwo Osipitan conducting the cross examination of Chief Obidulu with respect to his claims in Suit No. LD/3873/CMW/2018.
The matter being presided over by Hon. Justice (Dr) Olukolu of Lagos High Court sitting at Osborne Foreshore Estate II has to do with claim in trespass and illegal takeover of the personal assets of Chief Anthony Obidulu and loss of income that could have been generated by the Noddles manufacturing factory which was disrupted due to the illegal takeover.
The Algrain chieftain had responded to questions put across to him, highlighting the fact that even though the bank was claiming that he used the property in his factory situated on Plots 15/17 Canal Estate, Lagos as collateral, there was no “draw down” on the amount purported to have constituted the loan in question.
Further hearing on the matter continues at a later date.
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