Alleged $1.4m Debt: Firm Asks Court to Liquidate Debtor over Insolvency

Wale Igbintade

A firm, Uniterm Nigeria Limited has asked the Federal High Court in Lagos, to wind up an indigenous oil and gas company, Oriental Energy Resources Limited over alleged $1, 453, 356.76 debt.

The petitioner, in the winding up petition filed by its counsel Uchechukwu Obi, SAN, told the court that despite repeated calls and demands the Respondent has serially failed, refused and is unable to liquidate its outstanding debt to date.

It stated that over eight weeks have lapsed since the petitioner issued and served the Statutory Demand Notice on the Respondent on 13th April, 2022 but the respondent has failed, refused, defaulted and neglected to pay the said debts and its accruing interest.

The petitioner stated that it has suffered enormous business damage particularly with its funds withheld by the Respondent which the Respondent has instead invested into its own business thereby depriving the petitioner of its legitimate use of the funds for its business.

The petitioner expresses shock at the level of contractual breaches with impunity, insensitivity and bad faith characterising the Respondent’s business conduct, predatory nature, and attitude with no regard for sanctity of contracts which is a measure of bad faith and lack of conscience.

The petitioner added that the respondent is unable to pay its debt despite the service of the Statutory Demand Notice, adding that it was just and equitable that it be wound up so as to realize its asset to satisfy its Creditors including the Petitioner in the interest of justice.

The petitioner therefore, asked the court for an order “That the Respondent, (Oriental Energy Resources Limited), be wound up by the Court under the provisions of the Companies and Allied Matters Act, 2020.

“Alternatively, an Order entering judgment for the petitioner against the Respondent in the sums of USD $1, 453, 356.76 being contractual interest as at 16th June 2022 and thereafter at the rate of (LIBOR rate) of one (1) month interest rate increased by  five per cent  and calculated pro rata on a daily basis rate (or its equivalent) until full payment is made, and that the aforesaid amount be paid to the Petitioner within seven days from date of judgment, and for such other or further order (s) as the court may deem fit to make in the circumstances of this case.

In an affidavit in support of the motion for advertisement deposed to by a Litigation Executive, Chika Ohanekwu, the deponent stated that the petitioner demanded for winding- up of Oriental Energy Resources Limited on grounds of non-payment of debts due to the petitioner.

According to the deponent, the leave of court is required to advertise a petition for winding up of a company before the petition for winding up can be heard.

He maintained that the Petitioner has satisfied all the conditions precedent for the grant of the application in that it has filed a valid petition before this court and the same has been served on the respondent (Oriental Energy Resources Limited) in line with the Federal High Court (Civil Procedure) rules, 2019 and the Companies Winding-Up Rules.

But in urging the court to dismiss the application, Oriental Energy Resources Limited through its lawyer, Funke Agbor (SAN), asked for an order dismissing or striking out the petition and all pending applications filed by the petitioner for being incompetent and a gross abuse of the process of the court.

The respondent stated that the debt which forms the basis for the petition is bona fide disputed by the respondent/applicant and not due and payable to the petitioner.

The respondent stated that the company is a solvent, viable and capable of paying its debt, adding that the commencement of these proceedings constitutes inappropriate use of winding-up proceedings.

It stated that the Petition was commenced in respect of a subject matter and between the same parties as an already pending suit before the court and which the Petitioner was aware of.

“Based on the foregoing, this Petition is incompetent, an abuse of the process of court and liable to be dismissed by this Honourable Court.

“Based on the foregoing, there is no basis for the Honourable Court to proceed to entertain the Petitioner’s applications for advertisement of the Petition and interlocutory injunction or any other application filed by the Petitioner in these proceedings and same ought to be dismissed or struck out”.