Union Bank/NICON: Lender appeals verdict on £1m award

A Lagos High Court sitting in Ikeja has awarded the sum of £1m as damages against Union Bank of Nigeria in favour of NICON Investment. The court presided over by Justice Olubunmi Abike-Fadipe awarded the damages over the bank’s breach of its fiduciary duties to NICON and negligence. The bank also awarded the sum of […]

A Lagos High Court sitting in Ikeja has awarded the sum of £1m as damages against Union Bank of Nigeria in favour of NICON Investment.

The court presided over by Justice Olubunmi Abike-Fadipe awarded the damages over the bank’s breach of its fiduciary duties to NICON and negligence.

The bank also awarded the sum of N50m in favour of NICON Investment against Union Bank as damages for unlawful deduction and illegal penalties and charges made on the account of the claimant by the defendant.

The judgement was delivered in the suit LD1074/2010 with NICON Investment as claimant while Union Bank of Nigeria Plc is the defendant.

However, the Union Bank has disagreed with the judgement, hinting at appealing.

The counterclaimant is Union Bank Nigeria Plc, while NICON Investment Ltd, Global Fleet Oil and Gas Ltd and Jimoh Ibrahim are the defendants to the counterclaim.

The court stated that the defendant bank’s unilateral act of converting the sum of

£130,720,557.06 (One Hundred and Thirty Million, Seven Hundred and Twenty Thousand, Five Hundred and Fifty Seven Pounds a n d SixPence) from the claimant’s fixed deposit account to US Dollars without the due authorization and/or mandate of the Claimant is wrongful, null and void.

The bank also directed Union Bank “to render an account of all the transactions on the claimant’s pound sterling fixed deposit account together with all accrued interests thereron.”

“An order setting aside all acts of the defendant pertaining to and/or connected with and affecting the claimant’s pounds sterling fixed deposit account vis-a viz its conversion to S dollars, Naira, and unilateral liquidation of the indebtedness of Global Fleet Ltd and NICON Investment from the said account,” the court held.

The judge also held that the defendant’s bank’s unilateral act of converting the fixed deposit of the claimant from British pounds sterling to US dollars and dollars to Naira is unauthorised and null and void.

The court held that the indebtedness of Global Fleet to the defendant, if any, is neither payable from £130,720,557.06, the fixed deposit of the claimant nor any amount deductible therefrom in respect of Global Fleet Ltd indebtedness.

The judge stated that Union Bank could not unilaterally deal with or make any deduction from the fixed deposit account of the claimant without the authorization, mandate, or consent of the signatories to the fixed deposit account as on the mandate card.

Meanwhile, Union Bank Plc has disagreed with the judgement in a statement issued by its Chief Brand and Marketing Officer, Olufunmilola Aluko.

It said: “We wish to assure our customers, partners, and the public that Union Bank operates with the highest levels of professionalism, ethical conduct, and legal compliance in all our dealings.

“While we respect the authority of the court, we strongly disagree with the judgment delivered and have instructed our lawyers to file an appeal against it immediately.

“The court’s findings, including its position on the consolidation of indebtedness, locus standi, and third-party liability, are at variance with established legal principles and the Bank’s understanding of the facts. We are confident in our legal position and intend to vigorously pursue all lawful avenues to ensure that justice is served.

 

“Union Bank had previously transferred the relevant debt obligations to the Asset Management Corporation of Nigeria (AMCON), and we maintain that all actions taken in this regard were in line with applicable laws and banking practice.

 

“We reiterate our unwavering commitment to acting in good faith, protecting stakeholder interests, and preserving the integrity that has defined our institution for over a century. 

 

“The Bank remains resilient and focused on continuing to deliver excellent service and value to its customers.”