A Federal High Court in Lagos on Wednesday entered judgment in favour of Ecobank Nigeria Limited in a N3.1bn debt recovery suit it filed against Zamfara State Government and six others.
The trial judge, Justice Okon Abang, directed the Accountant-General of the Federation to ensure that the judgment sum with interest was deducted from funds accruable to Zamfara State in the federation account and be paid to Ecobank until the debt was fully liquidated.
The judge granted the bank’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.
Abang said he found from the papers filed before him that Zamfara State neither denied being indebted to the bank nor proved that it had liquidated the loan obtained from the bank in 2009 to execute a water project.
According to the judge, the state admitted obtaining a credit facility in sum of N1.5bn in 2009 from the defunct Oceanic Bank Plc, which was later acquired 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.”
He added, “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.”
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.
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.”