GHL floors firstBank, sets aside Mareva injunction

In a significant legal victory for General Hydrocarbons Limited (GHL), the Federal High Court in Lagos has set aside a Mareva injunction that had frozen the company’s assets and those of its directors.

The court ruled in favor of GHL and the other defendants in the case, emphasizing that the injunction was issued in violation of an existing court order from a court of concurrent jurisdiction.

Justice Dehinde Dipeolu, in his ruling, upheld the arguments of GHL’s lead counsel, Abiodun Layonu, SAN, as well as Olumide Aju, SAN, who represented the 2nd to 5th defendants.

The court found that the Mareva injunction was incompatible with a prior ruling made by Justice Ambrose Lewis-Allagoa in Suit No. 1953. The judgment held that First Bank of Nigeria and FBNQuest Limited, the institutions that sought the injunction, failed to disclose Justice Lewis-Allagoa’s earlier ruling, which rendered the Mareva injunction invalid.

The court further concluded that First Bank deliberately suppressed critical facts to mislead the court into granting the injunction. As a result, the court had no option but to set aside the freezing order on GHL’s assets, as well as those of the other defendants involved.

The legal battle began when First Bank approached the court with an ex-parte application against GHL and 15 other entities, despite the existence of a previous judgment in the matter.

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GHL and several defendants contested the order, arguing that it was granted based on fraudulent misrepresentation and the concealment of material facts. They asserted that had the full set of facts been presented, the freezing order would not have been granted.

Justice Dipeolu agreed with these arguments and ruled to discharge the injunction, declaring it unjustified and improperly granted.

In a subsequent development, GHL’s directors, who were also adversely affected by the asset freeze, have launched legal proceedings in multiple jurisdictions worldwide against First Bank, demanding $1 billion each in damages for defamation and the wrongful freezing of their accounts.

The company is also pursuing action before the Legal Practitioners Privileges Committee, seeking disciplinary measures against First Bank’s lawyers, Babajide Koku, SAN, and Victor Ogude SAN, for unprofessional conduct in their handling of the case.

This ruling marks a significant victory for GHL and serves as a cautionary tale about the importance of full disclosure and transparency in legal proceedings.