$225.8m Loan: GHL Directors Go After First Bank, Seek $1bn Each in Damages

By Adedapo Adesanya

The directors of General Hydrocarbons Limited (GHL) impacted by an ex parte freezing order secured by First Bank of Nigeria as regards a $225.8 million loan are seeking $1 billion each in damages for defamation and wrongful freezing of their accounts.

This is coming after GHL obtained an order from a Federal High Court in Lagos to set aside the Mareva injunction freezing the company’s and its directors’ assets on Wednesday.

Justice Dehinde Dipeolu had yesterday held that the Mareva order violated an existing ruling from a court of concurrent jurisdiction.

GHL’s counsel Mr Abiodun Layonu, a Senior Advocate of Nigeria (SAN), and Mr Olumide Aju (SAN), who represented the 2nd to 5th defendants, argued that the injunction amounted to an abuse of the court process.

They alleged that First Bank had misled the court by failing to disclose a previous order by Justice Lewis-Allagoa, which had restrained the bank from taking further action.

Mr Layonu claimed that the asset freeze had caused severe financial harm to GHL and its directors.

The dispute stems from a loan arrangement between First Bank of Nigeria Limited, a subsidiary of FBN Holdings Plc, and GHL, along with related entities such as GHL 121 Ltd, Aimonte Nigeria Limited, and Schlumberger Nigeria Limited.

On December 12, 2024, a court order barred First Bank from enforcing loan recovery measures until arbitration proceedings concluded.

Despite this development, it was reported that First Bank sought an ex-parte order against GHL and 15 other entities, leading to the asset freeze.

GHL and its co-defendants challenged the injunction, arguing it was obtained through fraudulent misrepresentation and the concealment of material facts.

They argued that had all the facts been presented before the trial judge, the order against them would not have been granted.

The trial judge upheld GHL’s arguments and consequently set aside the freezing order.

In his ruling, Justice Dipeolu stated that when compared with an earlier order issued by Justice Ambrose Lewis-Allagoa in Suit No. 1953, the Mareva Injunction should be set aside.

The court found that First Bank of Nigeria and FBNQUEST Limited, at whose instance the order was procured, failed to fully disclose Justice Lewis-Allagoa’s order, which made the Mareva Injunction incompatible with the earlier ruling.

The court consequently agreed with GHL and the 2nd to 5th defendants that First Bank deliberately “suppressed facts” to mislead the court into granting the order against GHL.

The court in the circumstance, said it had no choice but to set aside the order freezing GHL accounts as well as the accounts of all the other defendants in the case.

Justice Dipeolu adjourned the case till February 19, 2025, for further proceedings.