Court orders AMCON to pay Capital Oil and Gas N26 billion
In what could be described as an epic judgment a Federal High Court in Abuja on Thursday
ordered the Asset Management Corporation of Nigeria (AMCON) to pay
Capital Oil and Gas Limited the sum of N26Billion as contained in the
consent judgment delivered in 2013.
The court presided over by Justice Abdul Kafarati in his judgement held
that the court has powers to enforce its judgment or the verdict of any
lower court in the country.
Justice Kafarati also restrained AMCON from exercising any powers over
Capital Oil and Gas Limited and its assets and from processing any
assignment and transfer among others.
He further advised to live up to its statutory responsibility of
reviving the nation's economy through positive supports for businesses
to thrive.
The court went further to grant all the reliefs of the plaintiff and made the following orders:
"An order compelling the defendant (AMCON) to comply with obligations to restructure the plaintiff's debt and to provide Trade Finance Facility in the sum of 16 Billion Naira for revamping of the plaintiff's business and to pay the plaintiff's trade creditors.
"An order compelling the defendant to comply with the consent judgment and to make the additional sum of N10, 590, 000, 000 Billion naira available to the plaintiff for the payment of sundry creditors who continue to threaten the plaintiff's business.
"An order of injunction restraining the defendant from exercising any powers over the plaintiff and its assets and from processing any assignment, transfer or other demise whatsoever or requesting for statutory consent or other approvals for the transfer or other demise of any rights in the assets of the plaintiff," Justice Kafarati said.
In his reaction shortly to the judgment, counsel to the plaintiff,
Ajibola Oluyede, described the verdict as a "landmerk decision" that is
rooted in the vision of the founding fathers of AMCON, urging AMCON to
adhere to the position of the court by living up to its statutory
billing in providing the needed support for businesses to flourish with
the ultimate goal of creating jobs for the citizenry.
It would be recalled that a Federal High Court, Lagos Division, had on May 6th
struck out the suit commenced by AMCON against Capital Oil and Gas
Industries Limited on the grounds that the suit was premature and seeks
to circumvent existing suits in different courts on issues relating to
the alleged indebtedness of Capital Oil and Gas which is currently under
dispute.
This was the basis of an order by the judge, Justice Idris, striking out
a petition filed in the court by AMCON for the freezing of Capital Oil
and Gas’ accounts and winding up of Capital Oil and Gas Ltd for its
alleged inability to pay the disputed debt.
In the ruling delivered on 6th May 2016 in Suit No. FHC/L/CP/506/2016,
the judge upheld the contention of Capital Oil and Gas’ counsel, Ajibola
Oluyede, represented by Michael Damiari, that the winding up
proceedings filed by AMCON against Capital Oil and Gas was intended to
circumvent the existing actions in suits FHC/ABJ/CS/430/15;
FHC/ABJ/CS/514/15 and FHC/L/CS/1529/15 where-in live issues pertaining
to the consent judgment in FHC/ABJ/CS/714/2012 which is the subject
matter of the winding up petition are pending.
According to the court “until the issues raised in those suits are
determined, it will be premature to say the judgment debt has
crystalized as provided in clause 2.4 of the consent judgment”.
Specifically, the Federal High Court, Lagos Division,had struck out the
suit commenced by AMCON against Capital Oil and Gas Industries Limited
on the ground that the suit is premature and seeks to circumvent
existing suits in different courts on issues relating to the alleged
indebtedness of Capital Oil and Gas which is currently under dispute.
This was the basis of an or-der by the judge, Justice Idris, striking
out a petition filed in the court by AMCON for the freezing of Capital
Oil and Gas’ accounts and winding up of Capital Oil and Gas Ltd. for
alleged inability to pay the disputed debt.
In the ruling delivered on Friday 6th May 2016 in Suit No.
FHC/L/CP/506/2016, the judge upheld the contention of Capital Oil and
Gas’ counsel, Ajibola Oluyede, represented by Michael Damiari, that the
winding up proceedings filed by AMCON against Capital Oil and Gas was
intended to circumvent the existing actions in suits FHC/ABJ/CS/430/15;
FHC/ABJ/CS/514/15 and FHC/L/CS/1529/15 where-in live issues pertaining
to the consent judgment in FHC/ABJ/CS/714/2012 which is the subject
matter of the winding up petition are pending. According to the court
“until the issues raised in those suits are determined, it will be
premature to say the judgment debt has crystalized as provided in clause
2.4 of the consent judgment”.
In defence, Capital Oil and Gas, in its Respondent’s Counter Affidavit
of 91 paragraphs deposed to by Nsikan Usoro in opposition to AMCON’s
petition, had contended that AMCON grossly violated the terms of the
consent judgment entered between the two parties. It was argued that
AMCON failed, refused and/or neglected to inject the requisite funds
into Capital Oil and Gas as agreed and contained in the terms of the
consent judgment despite Capital Oil and Gas fulfilling all its
obligation of transferring assets valued at over N150 billion to AMCON.
It was also contended that Capital Oil and Gas, which is a going concern
and also a company of strategic national importance responsible for a
great percentage of petroleum products distributed nationwide, is not
insolvent, not indebted to AMCON, neither was it unable to pay its debt
as the company has assets worth over N300 billion, far in excess of any
alleged debt to AMCON or any other creditor.
It was further argued that AMCON is indebted to Capital Oil and Gas to
the tune of over N150 billion, arising from economic losses and damages
inflicted on Capital Oil and Gas by AMCON, through the gross
mismanagement of Capital Oil and Gas’ prime facilities and business
interests during the two years of AMCON’s ill management of Capital Oil
and Gas, which is the subject matter of suit no. FHC/ABJ/CS/430/2015 and
in other various claims pending before different courts.
The court agreed with the argument of Capital Oil and Gas in its
preliminary objection and struck out the petition. The court also set
aside all the interim orders made by the court therein.
It was further contended that AMCON is indebted to Capital Oil and Gas
to the tune of over N150 billion, arising from economic losses and
damages inflicted on Capital Oil and Gas by AMCON, through the gross
mismanagement of Capital Oil and Gas’ prime facilities and business
interests during the two years of AMCON’s ill management of Capital Oil
and Gas, which is the subject matter of suit no. FHC/ABJ/CS/430/2015 and
in other various claims pending before different courts.
The court agreed with the argument of Capital Oil and Gas in its
preliminary objection and struck out the petition. The court also set
aside all the interim orders made by the court therein.
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