UBA secures landmark court victory in a N156Bn debt recovery case against the Vaswani Brothers, owners of the Stallion Group

A Federal High Court in Lagos has ruled in favor of United Bank for Africa (UBA) Plc in its long-running N156 billion debt recovery suit against the Stallion Group and its founders, the Vaswani brothers (led by Sunil Vaswani)

Federal High Court in Lagos has ruled in favor of United Bank for Africa (UBA) Plc in its long-running N156 billion debt recovery suit against the Stallion Group and its founders, the Vaswani brothers (led by Sunil Vaswani)

In a sweeping decision, delivered by by Justice Daniel Osiagor of the Federal High Court sitting in Ikoyi, Lagos on Friday,  granted all the reliefs sought by UBA, affirming the validity of the appointment of a receiver/manager, the enforceability of the mortgage security and the liability of the guarantors.

The Court observed that the Defendants did not dispute the existence of their indebtedness to the Bank but challenged the amount claimed.

It further held that the reconciliation of accounts between the parties did not extinguish or negate the underlying indebtedness.

In a major affirmation of UBA’s enforcement rights, the Court upheld the appointment of the Receiver/Manager and confirmed his entitlement to take possession of the mortgaged property and seek appropriate protective orders.

The Court also dismissed objections raised by the 12th Defendant, holding that it had failed to establish any proprietary rights over the mortgaged property.

Consequently, its consent was not required for the creation of the mortgage, and its objections were rejected.

Significantly, the Court restrained the Defendants from diverting receivables due to them from government agencies, thereby reinforcing the Bank’s ability to protect its recovery interests.

The judgment also affirmed the liability of the guarantors, strengthening UBA’s legal position in pursuing recovery of the outstanding obligations.

The decision represents a comprehensive victory for UBA, with the Court resolving all issues in the Bank’s favour and granting all the reliefs sought.

The ruling is particularly significant for the enforcement of creditors’ rights in Nigeria, underscoring the legal validity of properly constituted security arrangements and the authority of duly appointed receivers to enforce creditors’ interests.

It also reinforces the principle that disputes over the precise amount of an outstanding debt do not, by themselves, invalidate the underlying indebtedness or prevent creditors from exercising their lawful recovery rights.

The judgment marks a major milestone in UBA’s efforts to recover its exposure to Stallion Group and safeguard the interests of the Bank and its stakeholders.