N3.1bn debt: Court to rule on garnishing Zamfara Govt account with UBA Feb. 24
NAN-H-109
Proceedings
By Sandra Umeh
Lagos, Jan. 17, 2017 (NAN) Ecobank Nigeria Ltd on Tuesday urged the Federal High Court, Lagos, to grant an order allowing it to take over funds belonging to Zamfara State, domiciled in United Bank for Africa (UBA) Plc.
Ecobank had initiated a garnishee proceeding against UBA over an alleged N3.1billion debt owed it by the state.
Joined as defendants in the suit were Zamfara state’s Attorney-General, Zamfara State Ministry of Finance, Federal Ministry of Finance, Accountant-General of the Federation, Attorney-General of the Federation and the Central Bank of Nigeria.
Justice Okon Abang had, in September 2015, ordered the defendants to pay the judgment sum of N3.1billion to Ecobank, being it’s outstanding indebtedness to the bank.
Abang had issued the order when he delivered judgment in Ecobank’s suit against the Zamfara State Government over the indebtedness.
Following the transfer of Abang from the Lagos court, Justice Babs Kuewumi assumed jurisdiction in the suit.
The plaintiff subsequently, commenced a garnishee proceeding against the defendants, joining more than 15 banks as garnishees.
The garnishee proceedings was taken out against the banks to compel them to disclose and remit the total funds of Zamfara State domiciled with the bank, with the aim of offsetting the debt.
Some of the banks listed as garnishess includes: UBA, Fidelity bank, First City Monument bank, Skye bank, Union bank, Diamond bank and Stanbic Ibtc, amongst others.
In the garnishee proceedings, all defendants in the substantive suit are now listed as judgment debtors while the plaintiff (Ecobank) is the judgment creditor.
In the proceeding, the judgment creditor is seeking an order of court, directing the banks to furnish it with all funds and credit balances in the account of Zamfara State.
On Tuesday, UBA, through its lawyer Mr Alfred Uwaka filed a preliminary objection seeking to strike out an order nisi made by Justice Babs Kuewumi.
An order nisi is a court order that does not have any force, meaning Ecobank cannot access the funds unless a particular condition is met.
After the conditions are met, the order becomes an order absolute (binding).
When the case was called on Tuesday, Uwaka contended that Ecobank failed to obtain the consent of Zamfara’s Attorney-General before initiating the garnishee proceedings, adding that the consent was a prerequisite.
“Failure to comply with the application for consent makes the order null and void,” he said.
Ecobank’s lawyer, Mr Kunle Ogunba (SAN), however, urged the court to make the order absolute so that it could take over Zamfara’s funds in UBA.
He said that the onus was on UBA to show how much of Zamfara’s funds it had or not, adding that filing a preliminary objection was an admission that the bank indeed had custody of the state’s funds.
Ogunba said: “I submit that a garnishee who files a notice of preliminary objection contending that no consent of the attorney-general was sought has unwittingly admitted that it has the judgment-debtor’s funds.”
The senior advocate recalled that in a previous garnishee proceeding, UBA wasted no time in telling the court that Zamfara had no money in its account with the bank.
“If they (UBA) have no money belonging to Zamfara, why file a preliminary objection? The approach they have taken shows that the court was right to have granted an order nisi.
“Based on the procedure adopted by the garnishee, it has shown clearly that it has the funds. The money is there. We’re sure of our facts.
“We urge the court to make the order absolute against UBA,” Ogunba said.
After listening to counsel, Justice Kuewumi fixed Feb. 24 for ruling. (NAN)
UNS/HAS/OFN
Edited By Hajia Sani//Felix Nwadioha