Law News
Paris Club refund: Court adjourns ruling on motion to unfreeze Delta State account

Justice Yusuf Halilu of the Federal Capital Territory (FCT) High Court has adjourned to August 23, 2017 for ruling on a motion by the Government of Delta State, praying the court to vacate the ex-parte order freezing its Paris-Club bank account.

The Delta State Paris-Club bank account was ordered to be frozen on the 3rd of August, 2017 by Justice Halilu amid allegations that the state government was depleting the funds kept in the account through unlawful payments to family members, friends, and cronies of the governor, Ifeanyi Okowa, in the guise of settling the fees for consultancy services in the fund’s recovery at the expense of the real consultant progenitor, Mauritz Walton Nigeria Ltd.

However, counsel to Delta state government, Alex Izonyi (SAN), approached the court to vacate its ex-parte order freezing the Paris-Club account of the state on the grounds that it lacked jurisdiction on the matter.

Izonyi had argued that since it was agreed between the government of Delta state and Mauritz Walton Nigeria Ltd that periodic updates of its consultancy services on the back duty reconciliation and recovery of excess deductions on foreign loans in the sum of $365m on behalf of the Delta state were to be given in Asaba, the state capital, the High Court of the FCT had no power to freeze the account.

On their part, counsels to Mauritz Walton Nigeria Ltd, Charles Ude and Kenneth Nkwocha urged the Court to preserve its order in relation to the sum of $27.3m and N3bn due to their client out of the fund standing to the credit of the Government of Delta state by virtue of proceeds of the Paris-London club refund pending the hearing and determination of the substantive suit.

Citing Order 9, Rule 3 of the FCT High Court which states that “all suits for the specific performance or breach of contract , shall where the contract ought to have been performed or where the defendant resides or carries on business in the Federal Capital Territory be commenced and determined in the High Court of the FCT, Abuja”, Charles Ude argued that since the recovery of the excess deductions were to be carried out in Abuja in conjunction with the Ministry of Finance, Debt Management Office, and Office of the Accountant-General of the Federation all in Abuja, the Court had proper jurisdiction to order the freezing of the Paris-Club account of the state.

Meanwhile, at the resumed hearing of the case yesterday, counsel to Delta state government was absent in court, and Justice Halilu adjourned ruling for the second time without giving any reason. He had previously adjourned ruling from Tuesday 15th August, 2017 to Monday 21st August.

Asked to comment on the delayed ruling, Charles Ude declined comment, stressing that it would amount to subjudice.

However, investigation reveals that some state governments who were yet to also settle their consultancy fees for the recovery of the excess deduction are rallying support for Delta state government.

It was gathered that Abia state has also approached the court to vacate a similar order freezing its own Paris club account. However, Cross River state government has opted for out of court settlement with Mauritz Walton Nigeria Ltd.

Nigeria Lawyer

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