Details Of Multi-Million Dollars Debt Mess Rocking The World Of Seplat Petroleum Boss ABC Orjiako
ABC Orjiako, the chairman of Seplat is heavily burdened.
According
to information available a Federal High Court sitting Ikoyi has
certified judgment delivered by the High Court of Justice Queen’s Bench
Division and upheld by the Supreme Court of the United Kingdom,
directing Shebah Exploration & Production Company Ltd, Allenne Ltd
and its president, Dr. Ambrosie Orjiako to pay African Export-Import
Bank, Diamond Bank Plc and Skye Bank Plc a sum of $144.2 million being
the outstanding and accrued interest of a facility granted to the
defendants in 2011.
Orjiako,
one of the founders of Seplat Petroleum Development Company (SEPLAT)
and currently its Chairman, is also listed as the President of Shebah
Exploration & Production Company Ltd.
The
court gave this certification following two decisions from both the
High Court of Justice Queen’s Bench Division and the Supreme Court.
Certifying
the court judgments on March 28, the court ordered the defendants to
comply with the judgment and denied the defendants permission to appeal
it.
The
first defendant, Shebah Exploration & Production Company Ltd is a
Nigerian company engaged in oil exploration and production while the
second defendant, Allenne Ltd is the guarantor of the borrowed loan.
The
third defendant, Dr. Ambrosie Orjiako, is the President of Shebah and a
personal guarantor of the liabilities of Shebah and Allenne pursuant to
a Deed of Guarantee and Indemnity dated July 1, 2011.
The
claimants had dragged the defendants before the High Court of Justice
Queen’s Bench Division in order to be able to recover an outstanding of
the facility loan granted to them.
The
claimants had apply for a summary judgment against the defendants for
sums outstanding under a syndicated loan facility agreement totaling
over $144.2m, together with interest on those sums.
They
had prayed the court to determine whether it is arguable that, in
entering the Facility Agreement, the parties were contracting on the
claimants’ written standard terms of business so as to engage section 3
of the Unfair Contract Terms Act 1997 (‘UCTA’).
In
a judgment delivered by Mr. Justice Phillips of the High Court of
Justice Queen’s Bench Division on February 19, 2016, the court said
Shebah had taken the loan for purpose of discharging certain of its
existing borrowing and to provide working capital for its operations,
including funding for a work-over programme to stimulate production at
oil wells in the Ukpokiti oil field.
According
to the court, the defendants never denied that the claimants advanced
$150 million to Shebah pursuant to the Facility Agreement, nor dispute
that, apart from paying one instalment of $6,111,111.11 in June 2012 but
Shebah has failed to meet any further repayment instalment, despite the
claimants agreeing to the deferral of several instalments.
The
judge said in a previous proceeding, which commenced on March 11, 2014,
the defendants agreed that, in exchange for the claimants’
discontinuing the proceedings, Shebah would repay all sums outstanding
under the Facility Agreement in two tranches: $49.999,999.86 (with
accrued interest) by April 30, 2014 and the balance of the loans and
interest by July 1, 2014.
He
added that Shebah failed to pay any part of the sum due on April 30,
2014. “The claimants were therefore entitled, under the terms of the
Discontinuance Agreement, to commence fresh proceedings in respect of
their claims.
These
proceedings were commenced on June 2014, repeating the claims
previously made and adding a claim against Shebah in respect of the
$49.999,999.86 due under the Discontinuance Agreement”, the judge said.
Phillips
stated that notwithstanding their previous stance, the defendants now
contended that no sums whatsoever are due to the claimants, adding that
they (the defendants) have arguable defence to the claim.
The
judge however ruled that there is no merit in the defendants’
contention on the issues on the ground that there is simply no basis for
inferring that the claimants, or any of them, habitually put forward
the LMA form (or a tailored version of it) as a basis for their
syndicated loan transactions.
“The most likely scenario is that it was chosen or selected by the claimants’ lawyer and that they will have adapted it to reflect the specifics of the transactions. It is impossible to draw any inferences as to what starting points may have been taken in other transactions, involving other permutations of lenders and other lawyers.
“The most likely scenario is that it was chosen or selected by the claimants’ lawyer and that they will have adapted it to reflect the specifics of the transactions. It is impossible to draw any inferences as to what starting points may have been taken in other transactions, involving other permutations of lenders and other lawyers.
“I
therefore satisfied that the defendants do not have a realistic
prospect of establishing at trial that the Facilities Agreement is on
the claimants’ written standard terms of business. The suggestion that
the disclosure might alter the position is a classic example of hoping
that something may turn up, in this case a forlorn hope given the
evidence that there was in fact a degree of real negotiation of the
final terms.”
Phillips
in his judgment held that whilst the claimants’ purported acceleration
of the loans on October 16, 2013 was ineffective, the defendants do not
have a defence to the claimants’ alternative case, based upon the
acceleration notice dated October 2, 2014 and subsequent demands dated
April 14, 2015 and July 27, 2015.
“For
the reasons set out above, the claimants are entitled to summary
judgment against all three defendants for (i) the principal outstanding
under the Facility Agreement of $143,888,888.89, subject to giving
credit for the sum paid during the course of this application and the
sums conceded in respect of default charges and hedging fees; (ii) the
management fees claimed; and (iii) interest calculated on the
alternative basis that the loan was accelerated on October 2, 2014”, the
judge held.
Dissatisfied
with the judgment, the defendants approached the Supreme Court of the
United Kingdom, seeking to quash the judgment.
Ruling
on the defendants’ application, the Supreme Court sitting comprising
Lord Mance, Lord Reed and Lord Lloyd-Jones upheld the decision of the
lower court and refused the permission to appeal the decision.
“After
consideration of the application filed on behalf of the Appellants
seeking permission to appeal the order made by the Court of Appeal on
June 28,2017 and of the notice of objection filed by the Respondents.
“The
court ordered that (1). Permission to appeal be refused because the
application does not raise an arguable point of law of general
importance. “(2). The Appellants pay the Respondents costs of the
application and, where the Respondents apply for costs, the costs to be
awarded be assessed.”
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