A Lagos Federal High Court has ruled in favour of UBA in its debt recovery dispute with Stallion Group, upholding the mortgage security, receiver’s appointment and guarantors’ liability
UBA Wins Stallion Group Debt Recovery Case in Lagos Court
By Lukman OMIKUNLE
United Bank for Africa (UBA) Plc has secured a major legal victory in its debt recovery dispute with Stallion Group after the Federal High Court in Lagos ruled in favour of the bank on all issues submitted for determination.
Justice Daniel Osiagor of the Federal High Court, sitting in Ikoyi, Lagos, delivered the judgment on Friday, granting all the reliefs sought by UBA and affirming the validity of the appointment of a receiver/manager, the enforceability of the mortgage security and the liability of the guarantors.
The court noted that the defendants did not dispute their indebtedness to the bank but challenged the amount being claimed. It held that the reconciliation of accounts between the parties did not extinguish or negate the underlying debt.
Upholding the bank’s enforcement rights, the judge affirmed the receiver/manager’s appointment and his entitlement to take possession of the mortgaged property, as well as seek appropriate protective orders.
The court also dismissed objections by the 12th defendant, ruling that it had failed to establish proprietary rights over the mortgaged property. Consequently, the court held that its consent was not required for the creation of the mortgage and rejected its objections.
In another significant aspect of the ruling, the court restrained the defendants from diverting receivables due to them from government agencies, reinforcing UBA’s efforts to protect its recovery interests.
The judgment further affirmed the liability of the guarantors, strengthening the bank’s legal basis for pursuing recovery of the outstanding obligations.
The decision marks a significant development in UBA’s efforts to recover its exposure to Stallion Group and protect the interests of the bank and its stakeholders.
Beyond the dispute, the ruling highlights important principles concerning the enforcement of creditors’ rights in Nigeria, including the validity of properly constituted security arrangements and the authority of duly appointed receivers to protect creditors’ interests.
It also underscores that a disagreement over the precise amount owed does not, in itself, extinguish an underlying debt or automatically prevent a creditor from exercising lawful recovery rights.
