Dissatisfied with a Federal High Court judgment which ordered it to settle a bank debt of N3.1bn with federal allocation accruable to it, Government of Zamfara State has appealed the judgment.

Justice Okon Abang entered the judgment in favour of Ecobank Nigeria Limited on September 30, 2015.
Abang, who said he found that Zamfara State did not deny obtaining a loan from the bank and did not prove that it had repaid it, ordered the Accountant General of the Federation to deduct N3.1bn with interest from the allocation due to Zamfara State in the Federation Account.

But the state appeared before Abang last hearing with an application praying to stay the execution of the judgment, pending the outcome of an appeal filed on October 5, 2015.

The state said it disagreed with Abang’s judgment and believed that its appeal had merit, adding that unless there was a stay of judgment execution, the outcome of the appeal would become nugatory.

The judgment of the court below is unreasonable, unwarranted and cannot be supported by the weight of evidence. Unless the judgment is stayed, it will have grave and irreversible consequence on the outcome of the appeal filed as well as the right of the applicant which forms the subject matter of the appeal.
“Interest of justice would be better served and our jurispudence enriched if stay of execution is granted to enable the 1st to 3rd applicants test same on appeal as the notice of appeal raises a substantial issue of law,” counsel for the state, Amu Henry, said.

But the bank had opposed the prayer to stay the execution of the judgment arguing that the six grounds contained in the notice of appeal “did not raise any recondite issue of law that would warrant the grant of stay of execution of the judgment of the court.”
Its counsel, Mr. Kunle Ogunba (SAN), argued that the judgment “being that of liquidated sum cannot be stayed.”

He urged the court to reject the application for stay of judgment execution, saying it was a grand design to frustrate the bank’s legitimate attempt to retrieve its depositors’ funds from Zamfara State.

However, Justice Abang has adjourned till October 23, 2015 to rule the stay of execution application.
Abang in the said judgment had granted Ecobank’s claim of N3.1bn with 30 per cent interest from March 1, 2013 till judgment day and 10 per cent thereafter until the final liquidation of the debt.

The said Zamfara State had admitted obtaining a credit facility in sum of N1.5bn in 2009 from the defunct Oceanic Bank Plc, which was later acquirred by Ecobank.

The judge said though Zamfara State claimed to have been paying back and had only an outstanding of N800m, the state did not say how much it had already paid and at what date its outstanding debt was determined to be N800m.
Abang said he had no option, in the circumstances, than to “adopt the amount claimed by the plaintiff in its writ of summons.”

The defendants have no defence to the plaintiff’s case and should not be allowed to dribble the plaintiff by denying it its right to the judgment credit. The facts of the case are not disputed by the 1st to 3rd defendants. The 1st to 3rd defendants have no defence to the plaintiff’s case.
“The plaintiff is entitled to judgment against the 1st to 3rd defendants jointly and severally in the sum of N3.1bn being their outstanding indebtedness to the plaintiff,” the judge held.

Earlier in the ruling/judgment, Abang dismissed the preliminary objection of the state, its Attorney General and Ministry of Finance challenging both the subject matter and territorial jurisdictions.

In dismissing their objections, Abang declared that the Federal High Court divisions in Gusau and in Lagos had equal jurisdiction and the plaintiff had the liberty to file its suit anywhere it pleased.

He added that the fact that the agreement for the loan was sealed at the bank’s headquarters in Lagos conferred subject matter jurisdiction on the Lagos Federal High Court, despite that the water project was executed in Zamfara State.

The judge equally rejected the preliminary objections filed by the Federal Ministry of Finance and the Central Bank of Nigeria, who claimed to have been wrongfully joined because they neither stood as surety for the state nor were signatories to the loan agreement.

Abang said since Zamfara State had obtained the loan using its Irrevocable Standing Payment Order from the state government’s VAT account as security and since the CBN and the Federal Ministry of Finance were in custody and control of funds accruable to Zamfara State from the Federation Account, they were necessary parties because “the court cannot make an order in vain.”

He therefore ordered them along with the Attorney General and the Accountant General of the Federation to ensure that the debt is deducted from funds accruable to Zamfara State in the Federation Account for onward payment to the bank.

Earlier, the judge rejected the application by the Accountant General of the Federation asking for an extention of time to defend the suit.
He ordered Zamfara State, its Attorney General and its Ministry of Finance to pay Ecobank a sum of N50,000 as the cost of filing the suit.