Defendants allege police interference in $4.6m civil dispute

The Chief Executive Officer of Lionstone Offshore Services Limited, Mr. Amaechi Ndili and his wife, Mrs. Njide Ndili, have lamented their ongoing trial before the Lagos Special Offenses Court, Ikeja, over alleged $4.6 million debt is in violation of clear pronouncements of superior courts and that the police has no business interfering in business disputes or recovering civil debts.

The couple is being prosecuted over a civil business dispute between their company and Hercules Offshore Nigeria Limited.

They stated that despite the clear stand of the law and judgments of superior courts that police has no business in recovering civil debts, they still interfere in civil cases.

The defendants were alleged to have fraudulently converted the sum of $4.6 million said to belong to Hercules Offshore Nigeria Limited to their personal use, a matter that an Arbitration Tribunal in London presided over and granted an award to Hercules Offshore Nigeria Limited.

The dispute arose from a joint business agreement signed by the two companies: Lionstone, a Nigerian firm and Hercules Offshore Limited, an American company.

Both decided to work together on the tender of a specific contract in the oil sector. Lionstone, with the assistance of Hercules, bided for a contract with the Petroleum, which they did not eventually win.

Under the Memorandum of understanding (MOU), parties agreed that all disputes that may arise in the course of the contract implementation must be submitted to the Arbitration Tribunal in London.

Before the contract submission date, and the tenders closed, Lionstone (being an indigenous company) was solely awarded an interim contract by Addax in October 2010.

According to court documents, owing to the nature of their pre-existing relationship, Lionstone agreed to and worked together with Hercules Offshore on the interim contract, which arose before the main bided contract.

This interim contract made no mention of Hercules at all and was dated October 2010, while the Hercules/Lionstone MOU and its amendments were dated December 2011.

Under the new deal, and as a result of the potential strategic nature of their relationship, both parties agreed to share the proceeds from the interim contract solely awarded to Lionstone by Addax.

However, while the business was going on, Lionstone alleged breach of contract against Hercules and insisted that Hercules remedy its breach.

The disagreement led both parties to submit themselves before the Arbitration Tribunal in London as contained in their MOU and at the end of its sitting, the Tribunal made its findings and granted the award to Hercules.

In a bid to enforce the arbitral award, Hercules Offshore Nigeria Limited approached the Federal High Court, Lagos in suit number FHC/L/CS/1461/2017 and the matter is currently before the Court of Appeal in appeal number CA/LAG/CV/344/2019. Lionstone rejected the claim, stating that Hercules and Lionstone were not in a partnership, nor an agency relationship (their contract affirms this point), and that Hercules was indeed in breach of local content laws in Nigeria.

While the litigation was ongoing in Nigeria courts, Hercules Offshore petitioned the police, asking it to compel Lionstone to pay the contested sum, while alleging fraudulent conversion of money paid to Lionstone under the interim contract signed solely between Addax and Lionstone.

Lionstone denied the claim, adding that the tender is in any case lost, and the only subsisting contract is solely between Lionstone and Addax. It further claimed that the foundation for the Hercules arbitration award was wrong.

Lionstone added that the only other existing contract is between it and Hercules, which is a subject of arbitration at the time due to an alleged breach of MOU terms by Hercules.

Consequent upon the petition, police from the Special Fraud Unit, Ikoyi clamped down on all Lionstone’s accounts in Nigeria, while Lionstone on the other hand sued the police and Hercules for Tortious interference, claiming damages for injuries suffered by the unlawful interference in a civil dispute between parties.

Consequently, the police filed a charge against Ndili, his wife and their company, Lionstone Offshore Services Limited, alleging fraudulent conversation of $4.6million

When the matter came up before Justice Olubunmi Abike-Fadipe the first prosecution witness, Godwin Okon, who was business analyst manager of the company, said the first defendant agreed to the indebtedness of Lionstone Offshore Services to Hercules Offshore Nigeria in the statement he made at the Special Fraud Unit (SFU) of the Nigeria Police Force.

Led in evidence by the prosecutor, ACP Simon Lough (SAN), the witness said the defendant agreed to withhold money belonging to Hercules Offshore Nigeria Limited.

Okon said the defendant promised to pay back by installments and first installment to be remitted in the sum of $600,000.

He said it was when he failed to remit the amount owed Hercules Offshore Services that they decided to use the police to prosecute him to recover the money owed Hercules Offshore Services.

Okon told the court that Hercules Offshore Services had earlier taken the Lionstone Offshore Services Limited before an arbitration court in London in line with the provisions of the joint bidding agreement in the event of a dispute.

He said the London arbitration court decided in favour of Hercules Offshore Nigeria Limited.

Okon stated that the first defendant agreed that Lionstone was in dispute with Hercules over contractual sums and arbitration award was in favour of Hercules.

The witness said the defendants agreed to withhold money belonging to Hercules.

He said it was when he failed to remit the amount adjudged owed to Hercules Offshore Services that they decided to use the police to first seek recovery of the money, failing which they would prosecute him to recover the money claimed by Hercules.

During cross – examination by the defence counsel, Ebun Shofunde (SAN), the witness admitted that he was not aware or present during contract negotiations.

He said that Hercules had originally withheld funds due to Lionstone Marine resulting in Lionstone loosing its vessels.

The witness also stated that none of the directors of the company are in the country as they have all left Hercules.