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Afribank shareholders want preliminary objection heard alongside substantive suit

Category: Investors NewsBeat


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Afribank shareholders want preliminary objection heard alongside substantive suit

Jun 18, 2010 By Innocent Anaba


Afribank Nigeria Plc and its shareholders have asked a Federal High Court sitting in Lagos, to hear the preliminary objections raised by Central Bank of Nigeria, CBN, and others alongside their substantive suit, challenging the dissolution of the bank’s board without giving them  a chance to respond to alleged indictment by the apex bank’s Special Examination report.



Counsel to Afribank, Mr Onyebuchi Aniakor, in a fresh application before the court is contending that going by the new Civil Procedure Rules of the Court, preliminary objection is to be heard alongside the substantive suit, to save the time of the court.Meanwhile, Afribank is praying the court to declare  that to the extent that no report of the purported Special Examination into the books and affairs of the bank, said to have been ordered by the CBN Governor, June 22, 2009 was never made available to the bank and its members and their response thereto made and entertained prior to the CBN purportedly proceeding to take action thereon all such actions and steps taken by these defendants remain null, void and of no effect whatsoever and constitutes grievous violation of the bank’s and its members’ constitutionally protected rights to fair hearing under , section 36(1) of the 1999 constitution.



The bank also want the court to declare that the entirety of the circumstances surrounding the actions and steps taken by the CBN and its Governor in interfering in the business, operations and affairs of Afribank and the actions and steps themselves from  August 14, 2009 including but not limited to the purported removal of the bank’s MD and Chief Executive and the Executive Directors,  well as in purporting to replace them some with some others, are illegal, wrongful and void having been done in bad faith and in the absence of compliance with the due process requirements of the 1999 constitution.



The bank also want the court to nullify, invalidate in their entirety all steps taken by the CBN and its Governor, both by themselves or any other person(s) appointed by them,  their servants, agents, officials and privies in the business, operations and affairs of Afribank from  August 14, 2009 until date and said to have been so taken, in furtherance of or pursuant to the said Special Examination of the Bank, said to have been ordered by the CBN on June 22, 2009 and the purported report of the said Special Examination, itself including but not limited to the purported removal of the Bank’s MD  and Chief Executive, the Executive Directors of the Bank, as the case may be and the purported advance to the bank in the said sum of N50billion.



Counsel to Afribank is contending that while the CBN Special Examination had recommended that the shareholders of the bank should raise additional N1.5b, the CBN on the take over of the bank, N50b was unilaterally, onerously  and compulsorily forced on the bank, it was, equally, made convertible into equity shareholding in the bank in favour of the CBN, at the sole discretion of the latter.The bank is further contending that, while other banks were allowed to inject additional funds as recommended by the CBN  Special Examination, Afribank was denied such an opportunity, creating the impression of double standard by the apex bank in the handling of the issue.



Mr Aniakor further argued that while other banks were allowed to respond to issues raised by the CBN  Special Examination, Afribank was not afforded such an opportunity, clearly denying it fair hearing, which is in the interest of justice and equity.According to him, “no report of the said Special Examination of the bank or at all was made available by either the bank or its management, nor any response thereon sought from the bank when the CBN Governor proceeded on August 14, 2009 through its letters of that date to claim to have removed the Bank’s MD and the Executive Directors of the bank.



He further contended that  notwithstanding several representations by several stakeholders, shareholders associations and other well meaning Nigerians, the CBN Governor, remained unrelenting as they dismissed the entirety of the shareholders interests in the bank on the claim that they were.

 

http://www.proshareng.com/investors/company.php?ref=AFRIBANK


(Source:Vanguard)



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