News Column

N250 Million Loan - Judge Advises NDIC, Ogeyi Place Hotels

May 20, 2014

Adelanwa Bamgboye

A Federal High Court sitting in Port Harcourt, presided over by Justice Uche Agomoh, has advised both the NDIC and Ogeyi Place Hotels Limited not to foreclose amicable settlement in a debt recovery action pending before it.

According to the court papers, the defunct Allstates Trust Bank had granted the 1st defendant (Ogeyi Place Hotels Limited) a syndicated loan of N250, 000,000 for the purpose of developing a hotel in Port Harcourt, Rivers State. The sum was made up of a Term Loan of N200, 000,000 and an overdraft of N50,000,000.

The other parties to the syndication were Prudent Bank (now Skye Bank), Merchant Banking Corporation (now First Bank of Nigeria Plc) and First City Monument Bank Limited (FCMB).

The total indebtedness of the 1st defendant at the closure of the defunct bank in 2006, from both the term loan and the overdraft was N483, 856,915.09.

The facilities were secured by a deed of composite debenture on the fixed and floating assets of the 1st defendants and a registered multipartite deed of legal mortgage over property situate at No. 45, Tombia Street, GRA Phase II, Port Harcourt, Rivers State.

Allstates Trust Bank (in liquidation) took over the rights and obligations of FCMB in 2002 after FCMB pulled out of the transaction. The rights and obligations of FCMB were assigned to the defunct bank.

The addition of the defunct bank gave rise to a Supplemental Deed of Composite Debenture and a Supplemental Deed of Legal Mortgage in order to properly assign FCMB's interests in the collateral to Allstates Trust Bank (in liquidation).

The security for the facility was made up of a copy of the Multipartite Deed of Legal Mortgage over No. 45, Tombia Street, GRA Phase II, Port Harcourt, Rivers State, dated December 6, 2001 and registered as No. 38, page 38, in Volume 277 at the Lands Registry Office, in Port Harcourt Rivers State.

In its effort to recover the loan, the corporation briefed the law firm of Rickey Tarfa & Co to recover the outstanding indebtedness.

During the proceedings, the 1st defendant brought a proposal for amicable settlement of the debt and proposed to pay the sum of N250, 000,000 within five years in full and final settlement of the debt. When the matter came up on May 14, 2014, for definite hearing, the plaintiff's solicitor informed the court that he had a motion on notice to enter judgment in default of pleadings due to the fact that the defendants have not filed any defence to the suit up till date.

The plaintiff's solicitor therefore sought the leave of court to move his application.

However, the defence counsel argued that the motion was not ripe for hearing as he was entitled to more time to file his response to the pending application.

He further stated that the defendants were still interested in settling the matter out of court.

The matter was adjourned to June 11, 2014 for hearing of pending applications. The judge further advised parties to further explore an amicable means of settling the matter.

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: AllAfrica

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters