Alleged N900m Debt: Court Bars Bizman Samuel Egbukwu, His Firms, From Accessing Assets   

The Federal High Court sitting in Lagos has restrained one Samuel Egbukwu and his three firms from obstructing the Receiver/Manager appointed by the Wema Bank Plc over the affairs of Samvics Interior Limited (a firm in receivership) and its pledged assets in the execution of his statutory duties pending the determination of the originating summons filed in the suit.

The pledged assets include those lying at 3, Yinka Bello Street, Lekki, Phase 1, pursuant to the covenants enshrined in the Deed of Fixed and Floating Debenture dated August 10, 2018 and the Deed of Legal Mortgage created in favour of the Wema Bank Plc by the firm.

Justice Ambrose Lewis-Allagoa made the order in an ex parte motion marked FHC/L/CS/581/2024, filed and argued by Wema Bank’s lawyer Obinna Divine.

The bank sued the company in receivership, Samvics Interior Limited, its two sister companies; Samvics Exquisite Furniture Limited, Pallazo 2020 Suites Limited and their alter ego, Mr Samuel Egbukwu, over an alleged unpaid debt of N900 million.

The bank’s lawyers, while moving the motion informed the court that the application for interim injunction was pursuant to sections 554 and 556 of the Companies and Allied Matter Act,, 2020; Rules 20 Companies Procedure Rules 1992 and Order 3 Rules 6 and 9 Federal High Curt (Civil Procedure) Rules 2019.

Justice Lewis-Allagoa after listening to the Plaintiffs counsel’s submissions, made the order as well as the following against the all the defendants:

“That an Interim Order of this Honourable Court is granted authorizing the Plaintiff/Applicant herein and/or its duly appointed Receiver/Manager to take over and preserve all the assets, funds, shares, etc. of the Defendants, particularly the under listed properties: 17, Sanusi Fafunwa Street, Victoria Island, Lagos State; 19, Sanusi Fafunwa Street, Victoria Island, Lagos State; 3, Yinka Bello Street, Lekki Phase 1, Lagos State; Plot 28A, Babatunde Jose Street, Victoria island, Lagos and 1, Prince Kolawole Isikalu Close, Chevy View Estate, Lekki, Lagos State, pending the hearing and final determination of the Motion on notice filed in this suit herein.

“That an Order of interim Injunction is granted restraining the defendants herein from withdrawing, tampering, or otherwise dealing with any of the funds in any of their bank accounts in all banks and financial institutions within the territorial jurisdiction of this honourable court, pending the hearing and final determination of the Motion on Notice filed in the suit herein.

“That an Order of interim Injunction is granted restraining the defendants/respondents, their agents, servants, cronies, assigns and/or privies by whatsoever name called from disposing of, selling, Mortgaging, pledging or otherwise transferring, appropriating or dealing with the pledged assets of the Defendants/Respondents and properties/assets lying and situate at: 17, Sanusi Fafunwa Street, Victoria Island, Lagos State; 19, Sanusi Fafunwa Street, Victoria Island, Lagos State; 3, Yinka Bello Street, Lekki Phase 1, Lagos State; Plot 28A, Babatunde Jose Street, Victoria island, Lagos and 1, Prince Kolawole Isikalu Close, Chevy View Estate, Lekki, Lagos State. respectively without regard to the vested right of the plaintiff/applicant as the beneficiary of the Deed of Fixed and Floating Debenture dated August 10, 2018; Deed of Legal Mortgage, indeed the Appointor Of A Receiver/manager over the pledged Assets {belonging to the defendants/respondents} pending the hearing and final determination of the Motion on Notice filed along herewith.

“That an Order of interim injunction is granted restraining the defendants, its directors, staff, employees, officers, agents, privies or any other person or group of persons whatsoever under the Defendants’ authority or any other authority {however derived or sourced} from interfering with, obstructing, altering or otherwise disturbing the stocks of shares {in any corporate body, company association, incorporated real estate, Joint Venture (JV) Vehicles et al}, cash of any denomination, and all negotiable instruments in all registered Commercial institutions within and outside the geographical and territorial jurisdiction of this Honourable Court and belonging to Mr. Samuel Egbukwu (the fourth defendant herein} pledged in favour of the first defendant herein, in his capacity as Guarantor, and by virtue of a Personal Guarantee dated January 25, 2021, pending the hearing and final determination of the Motion on Notice filed along herewith.

“That an order of this Honourable Court is granted directing the Assistant Inspector General of Police Zone 2, Lagos, Commissioner of Police, Lagos State, Commandant, Nigerian Civil Defence Corps Lagos State Command, their Deputies, Assistants and all other officers under them or other Law Enforcement Officers/Personnel as may be deemed appropriate by the Receiver/Manager, to assist the said Receiver/Manager in his Lawful duties, functions, responsibilities and performance of his lawful duties as receiver/manager over the pledged Assets of the defendants in accordance with the tenor of the subsisting instruments pending the hearing and final determination of the Motion on Notice filed along herewith.

“That an Order is granted directing all the Banks and/or financial institutions in Nigeria and other companies contractually obligated to the defendants to furnish the Receiver/Manager and/or his office the details of any sums outstanding to the credit of any of or all of the defendants herein within seven days of being furnished/availed the Interim Order of Court in this surt.

“That an Order of this Honourable Court is made granting leave to the Plaintiff/Applicant to author the prescribed, statutory and procedural Notices depicting the current status of the first defendant as may be deemed fit in any Daily or Nationally circulated Newspaper in Nigeria.”

Meanwhile, further hearing of the suit’s originating motion has been adjourned to June 7, 2024.

Wema Bank Plc, in an affidavit in support of the originating motion, deposed to by Nworah Ugwunze, one of the bank’s legal officers, averred that the defendants are customers of the bank, who at different times have been provided with multiple credit facilities upon their application for the purpose of enhancing their business of furniture production in Nigeria.

He stated that sometime in 2017, the bank guaranteed a Bank of Industry (BOI) N408, 696, 560 million, term loan for the first and fourth defendants pursuant to the Bank Guarantee: BG/HQ/LEKKI IKATE/027/2017 dated November 16, 2017. And that immediately the BOI’s funds was received, it was disbursed directly into the defendants’ Account No: 0122071245 on February 14, 2018 and the funds were utilized as instructed by the defendants.

The deponent stated that when the BOI facility got exhausted, the defendants applied directly to the Wema Bank for more money via their ordinary Resolution dated August 10, 2018, and were granted multiple Credit facilities in the sum of N84.29 Million via an Offer Letter dated August 10, 2018.

As security for the said Credit facilities, the Plaintiff and the 1% Defendant executed a Deed of Fixed and Floating Debenture dated the 10 day of August, 2018 as security for the Facility availed the defendants over all the endeavours of the defendants jointly and severally. Now shown to me and marked as “Exhibit WM 1” Is a copy of the duly executed Deed of Fixed and Floating Debenture dated 10 August, 2018.

The deponent stated further that the said Deed of Fixed and Floating Debenture referred to above was subsequently registered with the Corporate Affairs Commission, and a certificate was issued as regards the said registration. Attached as “Exhibit WM 2” is the Certificate of Registration of the Deed of Fixed and Floating Debenture dated August 27, 2018, issued by the Corporate Affairs Commission. And as an additional security on the Facility, the Defendants Mortgaged the property at 3, Yinka Bello Street, Lekki Phase 1, Lagos State in the event of default on the part of the Defendants.

He also stated that the fourth defendant being the alter-ego and directing mind of the first to third defendants, also issued a Personal Guarantee in favour of the Wema Bank herein and as a Condition Precedent to the drawdown of the Facility.

He stated that as a known fact, the defendant, jointly and severally owns and controls the following under listed properties: 17, Sanusi Fafunwa Street, Victoria Island, Lagos State; 19, Sanusi Fafunwa Street, Victoria Island, Lagos State; 3, Yinka Bello Street, Lekki Phase 1, Lagos State; Plot 28A, Babatunde Jose Street, Victoria Island, Lagos and 1, Prince Kolawole Isikalu Close, Chevy View Estate, Lekki, Lagos State.

The deponent also stated that the continuous failure of the defendants to respect their obligation in the loan repayment, necessitated the call by the Plaintiff via the letter dated September 11, 2020, calling in the payment of the outstanding balance totaling N677,731,170.93 million, as at 11th September, 2020. And that rather than liquidate their Indebtedness, the defendants, in a bid to frustrate the Plaintiff’s move to recover its debt owed by them and to unlawfully holding onto depositors fund in Its bosom, instituted an action In Suit No: FHC/L/CS/1380/2020 at the Federal High Court, Lagos division.

He averred that, in order to restore the cordial business relationship that have longed existed between the parties therein, the defendants and the plaintiff executed a Terms of Settlement dated January 28, 2021 and filed in Suit No: FHC/L/CS/1380/2020 and subsequently filed a notice of discontinuance of the suit Attached and marked as “Exhibit WM 6 & 7” is the duly executed Terms of Settlement dated 28th January, 2021, and the Notice of discontinuance aforesaid.

He also stated that as part of the covenant in the executed Terms of Settlement and a condition precedent for the amicable settlement, the Plaintiff herein was required to grant a loan facility to the Defendants therein in the sum of N350 million, which was to be disbursed into the third Defendant’s account. And that in fulfilment of its own part of the covenant In the terms of settlement, the Plaintiff granted the defendants a facility sum of N350 million, vide an Offer Letter dated January 22, 2021, with the fourth defendant as Guarantor thereto, the Plaintiff herein availed the Defendants the mammoth sum of N350,000,000 {Three Hundred and Fifty Million Naira} for the advancement of Its corporate endeavors and diversification of its business interests, and the third defendant passed a board resolution accepting the facility on behalf of the Defendants.

He stated that the Deed of Fixed and Floating Debenture dated August 10, 2018, earlier executed was subsequently upstamped In favour of the first defendant to secure the sum of N900 million. Attached as Exhibit WM 10” Is the Certificate of Registration of Charge dated August 7, 2023 issued by the Corporate Affairs Commission.

The deponent averred that at the expiration of the tenure of the new credit facility, the defendants failed and/or neglected to liquidate the said facilities, and the same have continued to accrue interest in line with the terms and conditions as contained in the various instruments executed before the granting of the facilities.

He stated that the failure and/refusal of the defendants to liquidate their indebtedness secured by the Deed of Fixed and Floating Debenture, and a Deed of Legal Mortgage of the property lying and situate at No 3, Yinka Bello Street, Lekki Phase 1, Lagos, and the 4th Defendant’s Deed of Personal guarantee led to the crystallization of the Plaintiff’s legal right to enforce the instruments executed in its favour. And that the failure and/refusal of the defendants to liquidate their indebtedness has adversely affected the Plaintiff’s business who is a custodian of funds belonging to third parties and law abiding and hardworking members of the general public.

He averred that in view of the foregoing acts of the defendants, the Plaintiff was left with no other option than to exercise the powers vested in it by virtue of Clause 4 of the Deed of fixed and Floating Debenture dated August 10, 2018 executed in its favour by the first defendant which led to the appointment of a Receiver/Manager by tne Plaintiff over the pledged assets of the Defendants. And ghat the Plaintiff, in furtherance of the foregoing, and as legally enjoined, also issued a Notice of Appointment of Receiver/Manager over the first defendant to the Corporate Affairs Commission and the Notice is hereby attached and marked “Exhibit WM 12” while the letter confirming registration of the Notice of Appointment of Receiver/Manager with the Corporate Affairs Commission, Abuja is dated November 3 2023.

He stated that unless the defendants and their directors, are restrained by the Court, they will definitely obstruct, hinder and interfere with the powers vested in the Receiver/Manager as contained in the Deed of Appointment. And that unless the defendants are restrained together with other Directors of the first and third defendants, they would strip the assets of the defendants and dispose them; thus, leaving the plaintiff without any means of recouping and/or realizing the indebtedness secured by the Defendants’ pledged assets.

He also stated that unless the defendants and their directors are restrained they would place the assets of the defendants beyond the reach of the Court and the Receiver/Manager who is presently the alter ego of the first defendant. And that the Receiver/Manager being appointed out of Court needs the protection and direction of the Court to enable him perform his statutorily recognized duties unhindered and/or unimpeded; in a bid to recover depositor’s funds and to make the Plaintiff a going concern.