For negligence, Standard Chartered Bank Nigeria Limited was fined a total of N2,973 billion by a Federal High Court in Lagos, Nigeria.
In a case with the filing number FHC/L/CS/1187/2020, the court, Justice Akintayo Aluko, granted the amount to a corporation, Celplas Industries Nigeria Limited, a defendant/counter-claimant.
On December 2, 2020, Standard Chartered Bank, represented by attorneys Oluwatosin Lyayi, filed its Writ of Summons, Statement of Claim, and other related procedures, alleging the following against the defendant: “A declaration that the plaintiff is not in breach of any of its obligations to the defendant under the Facility Letter (committed) dated 1st September 2014 (2014 BFL) or any of the subsequent BFLs.
“A declaration that the utilisation clause contained in the 2014 BFL does not operate as an automatic obligation on the part of the Plaintiff to convert the Defendant’s US Dollar loan obligations to a Naira loan facility.
“A declaration that the defendant in order to be able to take a benefit of the utilization clause under the 2014 BFL, was required to make a request to the plaintiff for the draw-down of the Naira value of the sum of US$11,500,000.00 (Eleven Million, Five Hundred Thousand United States Dollars) as agreed by the parties by virtue of Facility in clear and unequivocal terms.
“A declaration that the defendant is not entitled to the payment of any sums from Plaintiff pursuant to the 2014 BFL and /or any document pursuant thereto.
“A declaration that the parties by virtue of the 2016 BFLs and subsequently the 2017 and 2018 BFLs, agreed to amend and restate the 1st September 2014 Facility Letter, therefore, the 2014 BFL is no longer binding and/or enforceable between the parties.
“A declaration that the terms contained in the 1st September 2014 Facility Letter are null, void and of no effect by virtue of the Facility Letters executed between the Plaintiff and the defendant subsequent to the 1st of September 2014 Facility Letter.
“A declaration that the terms in the 1st September 2014 Facility Letter have become spent and unenforceable by virtue of the terms contained in the 2016, 2017 and 2018 BFLs.
“A declaration that the terms in the 9th August 2018 Supplemental Facility Letter (“2018 BFL”) is that which governs the relationship between the plaintiff and the Defendant. And the cost of this action,” the statement added.
However, on February 12, 2021, Celplas Industries Nigeria Limited, the defendant/counterclaimant, filed a 172-paragraph statement of defence and counterclaim, joining the plaintiff’s case through attorney Charles Nwabulu.
The business then makes the following allegations against the bank:
“A declaration that the refusal of the plaintiff/defendant to counter-claim (contrary to the requirement of the Utilisation Clause of the Facility Letter dated September 1, 2014, and even after several demands to it by the defendant/counter-claimant to convert the outstanding sum of $10,888,856.862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11,500,000 Term Loan Facility whilst Naira still traded at N199/$1 is a breach of the plaintiff/defendant to counter-claim’s obligation under the utilization clause of the Facility Letter dated September 1, 2014.
“Special damages in the sum of N2, 772, 000 000 (Two Billion, Seven Hundred and Seventy Two Million Naira) and $743, 628 (Seven Hundred and Forty-Three Thousand, Six Hundred and Twenty-Eight United States Dollars) respectively against the Plaintiff/Defendant to Counter-Claim being the cumulative sum for loss of business earnings and profitability between 2019/2020 to 2023/2024 on the Ball Pen Factory sold, Consultancy fees incurred by the Defendant/CounterClaimant, interest paid on the $8,000,000 (Eight Million United States Dollars) trade toan, which expenses/ losses, the defendant/counter-claimant had to incur/suffer as a result of the plaintiff/defendant to counter-claim’s failure to comply with the Utilisation clause of the 2014 Bank Facility Letter by refusing to convert the outstanding sum of $10,888,856.862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty-Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11, 500,000 Term Loan Facility whilst Naira still traded at NGN 199/$1.
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“General damages in the sum of N 700,000,000 (Seven Hundred Million Naira) against the plaintiff/defendant to counter-claim in favour of the defendant/counter-claimant for the psychological trauma, mental torture and loss of business goodwill suffered by the defendant/counter-claimant as a result of the plaintiff/defendant to counter-claim’s refusal to convert the outstanding sum of $10, 888, 856.862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty-Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11,500,000 Term Loan Facility whilst Naira still traded at NGN199/$1.
“N50, 000,000 (Fifty Million Naira) as the cost of this action,” it added.
BrandSpur Nigeria news reports that in his ruling on January 17, 2025, Justice Aluko granted the defendant/counter-claimant’s request after carefully reviewing all of the documents submitted and the arguments made by their attorneys.
Citing numerous legal authorities, he concluded that the counter-claims were successful and entered the following judgement for the counter-claimant:
“A declaration that the refusal of the Plaintiff{/Defendant to Counter-Claim (contrary to the requirement of the Utilisation Clause of the Facility Letter dated September 1, 2014 and even after several demands to it by the defendant/counter-claimant to convert the outstanding sum of $10, 888,856.862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11,500,000 Term Loan Facility whilst Naira still traded at N199/$1 is a breach of the plaintiff/defendant to counter-claim’s obligation under the utilization clause of the Facility Letter dated September 1, 2014, is hereby made.
“Special damages in the sum of N2, 772, 000 000 (Two Billion, Seven Hundred and Seventy-Two Million Naira) and $743, 628 (Seven Hundred and Forty-Three Thousand, Six Hundred and Twenty-Eight Million United States Dollars) respectively against the Plaintiff/Defendant to Counter-Claim being the cumulative sum for loss of business earnings and profitability between 2019/2020 to 2023/2024 on the Ball Pen Factory sold, Consultancy fees incurred by the Defendant/Counter-Claimant, interest paid on the $8,000,000 (Eight Million United States Dollars) trade loan, which expenses/ losses the defendant/counterClaimant had to incur/suffer as a result of the Plaintiff/Defendant to Counter-Claim’s failure to comply with the Utilisation clause of the 2014 Bank Facility Letter by refusing to convert the outstanding sum of $10, 888, 856. 862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty-Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11, 500, 000 Term Loan Facility whilst Naira still traded at NGN 199/$1, are hereby awarded.
“General damages in the sum of N200, 000,000 (Two Hundred Million Naira) against the plaintiff/defendant to counter-claim in favour of the defendant/counter-claimant for the psychological trauma, mental torture and loss of business goodwill suffered by the
Defendant/counter-claimant as a result of the plaintiff/defendant to counter-claim’s refusal to convert the outstanding sum of $10, 888, 856.862 (Ten Million, Eight Hundred and Eighty-Eight Thousand, Eight Hundred and Fifty-Six United States Dollars, Eight Hundred and Sixty-two Cents) from the $11,500,000 Term Loan Facility whilst Naira still traded at N199/$1, are hereby awarded.
“Cost of the action in the sum of N1,000,000 is awarded in favour of the counter-claimant against the Plaintiff,” the claims added.
