On 16th April 2021, the Court of Appeal, Lagos Division reversed the decision of the Federal High Court and its USD13 BILLION award against the Nigeria Deposit Insurance Corporation (NDIC) in Appeal No. CA/210/2015.
The 1st Respondent – Visana Nigeria Limited – had sued the NDIC as liquidator of Continental Merchant Bank (CMB), to enforce an alleged liability owed by CMB on account of a Receivership action initiated by CMB against another company, Metalloplastica Plc. The 1st Respondent contended that Metalloplastica was indebted to the 1st Respondent and that the CMB-appointed Receiver was liable to settle Metalloplastica’s indebtedness to the 1st Respondent.
The Federal High Court agreed with the 1st Respondent and held that CMB was vicariously liable for the liabilities of its appointed Receiver and that NDIC, as liquidator of CMB, was therefore liable to settle the said liability.
The NDIC, represented by Lexavier Partners, successfully challenged the decision on several grounds, including a contention that the Federal High Court lacked jurisdiction to entertain the suit because the 1st Respondent did not comply with the provisions of the Companies and Allied Matters Act with respect to obtaining leave of court before suing NDIC as a liquidator. Consequently, the judgment of the Federal High Court against NDIC was set aside and the USD13 billion (6.3 trillion naira) liability was overturned.