For allegedly refusing to refund a contract sum after a failed contract, a firm, Satek Nigeria Limited, has instituted a suit against a new generation bank before a Lagos High Court sitting in Osborne, Ikoyi.

Apart from the bank, joined as the second defendant in the suit marked LD/ADR/4527/22, is Technova Industries Limited.
[ad]
Satek Nigeria Limited and its Chief Executive Officer (CEO), Mr. Samson Babajide, in their amended statement of claim, filed by their counsel, Mr Adekunle Adegbite, alleged breach of contract by the defendant.

Babajide stated that they had a contractual agreement with the first defendant for payment guarantee as security to complete the contract of importing deep chillers.

According to him, the first defendant asked that the claimants deposit the sum of N14.3 million, which was done on July 13, 2017.

The claimants later made a demand on the said deposit in a letter dated June 10, 2021.

“The claimants aver that the first defendant prior to the deposit of the said money by the claimants had confirmed via a letter dated December 8, 2016 to the second defendant that the payment guarantee shall become void after 150 days, if not utilised.

“The claimants also aver that the first defendant by letter dated December 14, 2016 also confirmed to the second defendant that the payment guarantee was issued to it on behalf of the claimants,” the claimants swore.

They added that a dispute arose with the second defendant as the condition precedent for being paid the guarantee was not fulfilled, leading to the claimants suing both defendants at the High Court of Lagos when the first defendant wanted to release the money on the payment guarantee to the second defendant.
[ad]
The claimants further swore: “The claimants aver that though it sued both defendants, the case was struck out on technical grounds by the Court on December 17, 2017 on the ground that the pre-action form was not served on the defendants, leading to the claimants to eventually concede that the matter be struck out.

“The claimants aver that they tried unsuccessfully to get some of its Deep freeze chillers worth over N30 million placed in the custody of the second defendant as the said company had ceased operation in Nigeria.

“The said guarantee was procured by the first claimant on the condition that the second defendant will remit the sum of £44,270.52 to the foreign sellers of 80TR Air coolers, which the second defendant failed and neglected to do and is no longer carrying on business in Nigeria.

“The first defendant has refused to release the money the claimants deposited with the first defendant despite repeated requests for same as shown in its letters dated May 5, 2017, March 4, 2020, April 12, 2021 and July 19, 2022.”

But the Bank according to them claimed the deposited sum cannot be returned to the claimants unless there is a valid court judgment to that effect and their obligation to the second defendant is discharged since there is no way a letter of performance can be obtained from the second defendant as it did not fulfill the condition precedent for the payment guarantee.

The claimants, therefore, asked the court for “a declaration that since the second defendant had failed to perform its obligation to the claimants for which the payment of the guarantee was set up, the first defendant is discharged from its obligation to make payment to the second defendant.”

They asked for N14.3 million refund, 10 per cent interest yearly from July 2017 and a cost of N1.7 million.
[ad]
In its amended statement of defence by Mudashiru Aihari, the bank urged the court to dismiss the claimants’ suit with substantial cost, for being frivolous, abuse of the judicial process and gold-digging.

The bank said: “Contrary to the averments contained in paragraph 4 of the statement of claim, wherein the claimants relied on a Contractual Agreement entered by the first claimant with Technovaa Industries Limited, the first claimant failed woefully to exhibit the Contractual Agreement for easy understanding of what was agreed to by the first claimant and Technovaa Industries Limited.

“The defendant admit that there exists a payment guarantee of December 8, 2016, issued by the defendant on behalf of the first claimant in favour of Technovaa Industries Limited in the sum of N14. 300 million, and this Payment Guarantee was at the request of the first claimant vide their letter of November 8, 2016.

“That the defendant on November 17, 2016 issued to the first claimant an Offer Letter for a Bank Guarantee Facility in the sum of N14,300 million, for a tenor of six months with Techonavaa Industries Limited as the Beneficiary and the terms and conditions contained in the Offer Letter were accepted by the first claimant on November 17, 2016.
[ad]
“That in the Payment Guarantee of December 8, 2016, it was stated that the first claimant entered into an Agreement with Technovaa Industries Limited for the supply of 80TR Carrier Air Cooled Scroll Chiller and that Technovaa Industries Limited made an initial payment of N14, 432 million to the first claimant for the supply of the goods and the first claimant was unable to supply, and that the 1st claimant has agreed and undertaken to repay the sum of N14.3 million to Technovaa Industries Limited within 150 days from the issuance date of a valid guarantee and this necessitated the defendant to issue the said Guarantee.”

The bank argued that the Payment Guarantee issued by the defendant on December 8, 2016 was valid for 180 days from the date of issuance and for the sum of N14.3 million, and the Guarantee was solely in favour of Technovaa Industries Limited.

It added that same became null and void at the expiration of the tenor whether or not it was returned to the defendant for cancellation.

The bank denied most of the averrements and countered them, urging the court to dismiss the suit.
[ad]