Capital Oil Fails To Get Reprieve As Court Adjourns Decision Date

SAN FRANCISCO, November 30, (THEWILL) - A Federal High Court presided over by Justice Abdul Kafaratu sitting in Abuja Friday, reserved ruling on an application filed by Capital Oil and Gas Company to set aside an order he (Kafaratu) gave on November 13 giving the Asset Management Corporation of Nigeria (AMCON) the authority to takeover the properties of the oil trader and its managing director, Ifeanyi Ubah.

Justice Kafaratu had earlier on November 13, 2012 granted AMCON the power to immediately possess the properties of the oil trader but has however adjourned the judgment day till December 11 when he will take a decision on the appeal filed by counsel to Uba, Chief Wole Olanikpekun (SAN) asking the court to set aside the earlier order reason being that the action, when taken, would not be in the interest of the Nigerian public.

According to the counsel, Capital Oil being the second largest fuel distributor in Nigeria plays a crucial role in the country’s socio-economic survival and any forfeiture of the company’s assets would have a negative impact on the Nigerian society at large.

He further argued that since AMCON was yet to commence the debt recovery action which was meant to be within 14 days from the date of the order it will be in the interest of both parties – Capital Oil and AMCON – to stay action.

But counsel to AMCON, Kemi Balogun, who had prayed the court to throw out the application told the court that an inspection committee set up by both parties showed that Capital Oil has only 21 million litres of fuel which is just enough to supply Lagos State for only one day in its tank.

Capital Oil’s counsel had also prayed the court earlier to grant his client access to 50% of the credit balance in some of his accounts with the United Bank of Africa (UBA) to enable him pay salaries and attend to his personal needs as against the court’s ruling which said the defendants can withdraw 25% of the amount disclosed by the bank in its affidavit.

Olanipekun in his appeal is seeking an order of interlocutory injunction restraining the plaintiff (AMCON) from disposing, selling or leasing out properties belonging to his client pending the final determination of the suit.

The defendants, in an affidavit, stated that both parties had agreed on modalities for the re-payment of the loans and had rescheduled payment terms which allow Capital Oil to make good its indebtedness to the creditors over a period of eight years beginning from next year 2013.

AMCON has also listed 21 banks with which Capital Oil operates different accounts as co-defendants in the matter.

Ubah and Capital Oil have also being listed by the Central Bank of Nigeria (CBN) among 113 companies who along with their 419 directors/shareholders have been said to be indebted to AMCON to the tune of N48.014 billion as the central bank further directed Nigerian financial institutions not to extend credit to them and their directors until they settle their indebtedness to the financial institutions and others.