Honeywell Drags Ecobank to Supreme Court over Alleged N3.5bn Debt

Honeywell Group on Monday indicated that it will approach the Supreme Court to challenge the judgment of the Court of Appeal against it in a N3.5 billion debt controversy.

The counsel to Honeywell Group, Mr Olabode Olanipekun (SAN), gave the indication shortly after the appellate court reversed a lower court’s decision in favour of Honeywell Group.

The Court of Appeal, in a judgment delivered Monday, had reversed the judgment of the Federal High Court, Lagos delivered in May 2019, where the lower court held that operating companies of Honeywell Group were not in any way indebted to Ecobank.

Honeywell had in 2015 filed a suit against Ecobank, asking the court to determine whether or not its three subsidiaries, Anchorage Leisures Ltd, Honeywell Flour Mills Plc and Siloam Global Limited, were still indebted to Ecobank after having reached an agreement to pay the sum of N3.5 billion as full and final settlement of the companies’ indebtedness.

The lower court in its judgment however held that the company was not in any way indebted to the bank having liquidated the said loan.

Dissatisfied, the bank approached the appellate court to challenge the decision of the lower court and got judgment entered in its favour.

Reacting to the appellate court’s decision, Honeywell Group’s general counsel, Olasumbo Abolaji, said the company remains convinced that it has a compelling case and it is ready to appeal the judgment of the Court of Appeal.

“Litigants can seek relief up to the Supreme Court. Consequently, the decision of the Court of Appeal is definitely not final on this matter,” she said.

She stated that in the course of the court action, at least 10 decisions had been the subject of appeals both at the Court of Appeal and the Supreme Court, adding that Honeywell largely recorded victories at those stages based on the strength of its arguments.

“We believe in the Nigerian judicial system and we will take our case further to the Supreme Court,” she concluded.

In her testimony at the lower court during the trial, Honeywell Group’s Chief Finance Officer, Oluwakemi Owasanoye, told the court that by an agreement reached at a meeting held on July 22, 2013, the bank agreed to merge the collective indebtedness of Honeywell’s three subsidiaries, which amounted to N3.5 billion with the negotiations anchored by Honeywell Group Limited.

Owasanoye added that part of the agreement reached with the bank was that N500 million must be paid immediately, while the balance of N3 billion would be paid before the exit of the Central Bank of Nigeria (CBN) examiners from the bank, without any specific stipulation on number of tranches.

She stated that Honeywell complied with the terms of the agreement, and thereafter wrote to inform the bank of its compliance and the need for the bank to formally discharge the company of any further obligation.

She stated that the bank in its reply to the letter did not raise any objections. Honeywell, she said, was however surprised when the bank proceeded to demand further payments in respect of the debt which had been fully liquidated for over a year.

She further stated in her testimony that when the dispute arose, the company referred the matter to the Bankers’ Committee which resolved the matter in favour of Honeywell.