Zamfara to Settle N3.1 Billion Ecobank Debt with Federal Allocation

ecobank

A federal high court in Lagos State has ordered that Zamfara State settle its N3.1 billion bank debt to Ecobank Plc with its monthly federal allocations.

Justice Okon Abang of the federal high court gave the ruling against the government of Zamfara State and six others on Wednesday.

Justice Abang ordered the Accountant-General of the Federation to deduct the judgement sum with interest from federal allocations accruable to Zamfara State in the federation account and pay same to Ecobank until the whole loan is fully serviced.

[ad name=”PostTopAd”]

To this end, Ecobank’s claim of N3.1 billion with 30% interest rate dating from March 1, 2013 till September 30, 2015 which was the court’s judgement’s date be deducted from Zamfara’s federal allocation and be paid to the bank, and this is exclusive of the 10% interest that must be paid thereafter until the whole debt is cleared off.

According to Justice Abang, court papers revealed that Zamfara State did not deny borrowing loans from Oceanic Bank which was later acquired by Ecobank, nor proved that it liquidated the loan taken out in 2009 to execute some water project.

The judge is however aware of Zamfara State’s claim that it had been servicing the loan and only has about N800 million left to be cleared, the court stated the state failed to clarify how it had been paying back the loan; how much it had already paid back; and the actual date the claimed outstanding debt was determined to be N800 million.

“The defendants have no defence to the plaintiff’s case and should not be allowed to dribble the plaintiff by denying it its right to the judgment credit,” Judge Abang ruled. “The facts of the case are not disputed by the 1st to 3rd defendants. The 1st to 3rd defendants have no defence to the plaintiff’s case. The plaintiff is entitled to judgment against the 1st to 3rd defendants jointly and severally in the sum of N3.1bn being their outstanding indebtedness to the plaintiff.”

Zamfara State, its Attorney General, and Ministry of Finance had earlier challenged the subject matter and the powers of the federal high court in Lagos to determine the case, but Justice Abang had overruled this – stating that both federal high court divisions in Gusau and in Lagos had equal jurisdiction to hear the case, and that the complainant had the powers to file the case anywhere it wanted.

[ad name=”PostBottomAd”]

Justice Abang maintained that since the loan agreement was finalized at Oceanic Bank’s headquarters in Lagos, the federal high court in Lagos has subject matter jurisdiction over the case regardless of the fact that the water project was executed in Zamfara State.

Abang insisted that since Zamfara State had obtained the loan, using its Irrevocable Standing Payment Order from the state government’s VAT account as security and since the CBN and the Federal Ministry of Finance were in custody and control of funds accruable to Zamfara State from the Federation Account, they were necessary parties because “the court cannot make an order in vain.”

About the Author

Charles I. Omedo
Charles is a writer, editor, and publisher. He has a degree in Mass Communication and a PGD in Digital Communication.

Be the first to comment on "Zamfara to Settle N3.1 Billion Ecobank Debt with Federal Allocation"

Leave a comment

Your email address will not be published.


*