A legal battle between Algrain Foods Limited and a consortium of banks has resulted in a court-ordered sale of the company’s assets. First City Monument Bank (FCMB) and First Bank of Nigeria Limited (FBN) had previously extended credit to Algrain Foods, but when the loan became delinquent, the banks took legal action.
Court Orders Sale of Assets
FCMB Trustees Limited, acting on behalf of the banks, appointed Mr. Ade Oyebanji as receiver for Algrain Foods’ assets. In 2017, the Federal High Court granted the receiver a protective order allowing him to take possession and manage the company’s assets.
Algrain Foods contested the action, filing a lawsuit in 2020 against the banks and the receiver. They alleged trespass and sought the appointment of independent auditors. However, the court dismissed this case in October 2021, deeming it an abuse of process.
Following this dismissal, the Federal High Court issued a judgment in November 2021 in favor of the banks and the receiver. This judgment explicitly authorized the receiver to sell Algrain Foods’ assets to recover the outstanding debt.
Algrain Foods Appeals, Raises Concerns
Algrain Foods subsequently filed an appeal with the Court of Appeal, arguing against the sale. Additionally, they raised concerns with law enforcement agencies regarding the receiver’s actions. These concerns, however, were dismissed by the banks, who pointed to the court judgment as justification for the sale.
Banks Maintain Legality of Sale
The receiver, Mr. Oyebanji, maintains that the sale was conducted legally and in accordance with the court order. He emphasizes that Algrain Foods failed to file a stay of execution before the sale took place.
The outcome of the appeal with the Court of Appeal remains to be seen. However, as of now, the court-ordered sale of Algrain Foods’ assets stands.
