UNITED Bank for Africa (UBA) Plc has secured a major legal victory in its bid to recover about N156 billion allegedly owed by Stallion Group and companies linked to the Vaswani brothers, after the Federal High Court in Lagos upheld the bank’s enforcement of mortgage securities.
In a judgment delivered on Friday, Justice Daniel Osiagor affirmed UBA’s appointment of a receiver/manager, Romeo Ese, and authorised him to take possession of properties pledged as collateral for the loans.
The court also upheld the liability of the guarantors and restrained the defendants from diverting payments due to them from government agencies, strengthening the bank’s efforts to recover the outstanding debt.
The dispute arose from a suit filed by UBA in 2023 against Stallion Nigeria Limited and several related companies over an alleged debt of N156.03 billion.
In determining the case, Osiagor held that the defendants had not denied owing the bank but disputed the amount being claimed. He ruled that the reconciliation of accounts between the parties did not extinguish the debt or prevent UBA from enforcing its security interests.
The judgment further affirmed the validity of the mortgage arrangements and the receiver/manager’s authority to protect and take possession of the secured assets.
READ ALSO: Parallex Bank urges court to dismiss FHT Mega Express’ N7.15bn suit over legal abuse
The court dismissed an objection by Barbedos, the 12th defendant, which argued that its consent was required before the mortgage arrangements could be created.
Osiagor held that Barbedos had failed to establish a proprietary interest in the mortgaged properties and therefore had no legal basis to challenge the arrangements on the grounds that its consent had not been obtained.
The judge also resolved the jurisdictional issues in UBA’s favour, affirming the court’s authority to hear the bank’s claims.
Related Articles
The restriction on diverting receivables from government agencies is particularly significant because it allows the bank to protect payments owed to the defendants and pursue recovery through those funds.
The court resolved all the issues submitted for determination in favour of UBA and granted the reliefs sought by the bank.
The legal battle dates to October 2023, when UBA obtained interim court orders to enforce its security over assets belonging to Stallion Nigeria Limited and its subsidiaries. The properties covered by the earlier orders included industrial and commercial assets in Lagos, Port Harcourt and Kano.
READ ALSO: Court orders 71 banks to freeze accounts linked to N1.3bn Access Bank fraud
Stallion Group disputed the bank’s position in November 2023, saying it had made substantial repayments and was engaged in discussions with UBA over account reconciliation and debt restructuring.
The proceedings subsequently faced procedural disputes, including an application by counsel representing some of the defendants seeking the transfer of the case from the court of Justice Akintayo Aluko, who had handled earlier applications.
The latest ruling strengthens UBA’s legal position in pursuing recovery from the principal debtors and guarantors, although the enforcement process will determine how much of the outstanding obligation can ultimately be recovered.
