United Bank for Africa (UBA) Plc has recorded a major legal victory in its N156 billion debt recovery battle against the Vaswani brothers and Stallion Group, following a Federal High Court judgment upholding the bank’s claims and affirming its right to enforce securities pledged against the outstanding debt.
Justice Daniel Osiagor of the Federal High Court sitting in Ikoyi, Lagos, delivered the landmark judgment on Friday, resolving all issues in favour of UBA and granting all the reliefs sought by the bank.
The court upheld the appointment of Romeo Ese as Receiver/Manager, affirmed the liability of the guarantors and restrained the defendants from diverting receivables due to them from government agencies.
In a sweeping decision, Justice Osiagor also affirmed the court’s jurisdiction to entertain the suit, rejecting objections challenging its authority to adjudicate on the debt recovery proceedings.
According to details of the judgment, the defendants did not dispute their indebtedness to UBA but challenged the amount claimed by the bank.
The court held that the reconciliation of accounts between the parties did not extinguish or negate the underlying indebtedness.
In another significant ruling, Justice Osiagor upheld the validity of Ese’s appointment as Receiver/Manager, affirming his authority to take possession of the mortgaged properties and seek appropriate protective orders to safeguard the bank’s interests.
The court also dismissed objections raised by the 12th defendant, ruling that it had failed to establish any proprietary rights over the mortgaged property.
Consequently, the judge held that the defendant’s consent was not required for the creation of the mortgage, thereby clearing a major legal hurdle in UBA’s efforts to enforce its security interests.
The judgment further affirmed the liability of the guarantors, reinforcing the bank’s legal position in pursuing recovery of the outstanding obligations.
Of particular significance was the court’s order restraining the defendants from diverting payments due to them from government agencies.
The restriction is expected to preserve funds potentially available for debt recovery and prevent actions that could frustrate the enforcement of the judgment.
The ruling represents a major breakthrough in UBA’s efforts to recover its N156 billion exposure to Stallion Group and the Vaswani brothers.
It also underscores the enforceability of mortgage securities and the authority of duly appointed receivers and managers to take possession of secured assets in accordance with the law.
The judgment reinforces the legal distinction between disputing the amount of an outstanding debt and denying the existence of the indebtedness itself.
With all issues resolved in UBA’s favour, the decision strengthens the bank’s position in pursuing recovery of the outstanding obligations and protecting its financial interests.
The defendants’ immediate reaction to the judgment and whether they intend to challenge the decision on appeal could not be ascertained at the time of filing this report.
