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    Friday, December 27, 2013

    CBN, Wema Bank Object To Debt Recovery Suit

    The Central Bank of Nigeria (CBN) and Wema Bank Plc have objected to a debt recovery suit filed against them at the Federal High Court in Lagos by the Central Securities Clearing System Plc.
    In separate notices of preliminary objection, CBN and the bank urged the court to dismiss the suit.
    The CBN (third defendant) sought an order declaring that the court has no jurisdiction to entertain the action against it.
    It further prayed for an order striking out its names from the case.
    CBN said as a statutory, regulatory and supervisory institution of the Federal Government, it is not in any way liable to the plaintiff on the suit’s subject matter.
    It added that it was not in any way involved in the transaction between the plaintiff, Wema Bank and the second defendant (Mr Seyi Akinwunmi, the liquidator of Wema Securities and Finance Plc).
    CBN said the reliefs being sought by Central Securities are “wholly speculative and pre-emptive” of the court’s judgment and that the plaintiff has no right of action against the third defendant.

    “This suit does not disclose a reasonable cause of action against the third defendant/applicant and the court in consequence lacks the jurisdiction to entertain the suit in this respect.
    “The suit as it is presently constituted is incompetent against the third defendant/applicant,” CBN said.
    Central Securities, by its Originating Summons, is seeking judgment against Wema Bank and Akinwunmi in the sum of N272.7 million and interest on it.

    The sum is said to be a debt owed plaintiff as return on investment of its funds.
    The plaintiff’s claim against CBN is for an order compelling the deduction of the judgment sum from Wema, which CBN is holding, and the subsequent remittance of the money into its (Central Securities’) bank account.
    But CBN said the Wema Bank fund that it has are statutory and mandatorily required to be kept by all banks in Nigeria with the “apex” bank and are not deductible towards the satisfaction of debts.
    Besides, it said it is not a necessary and proper party to the suit and that its name should be struck out.
    Wema Bank, in its objection, sought an order striking out the suit for want of jurisdiction.

    The bank said the plaintiff’s claims “is for a simple debt recovery proceeding which is excluded from the jurisdictional competence of the Federal High Court.”
    Besides, the bank said the suit does not disclose any reasonable cause of action against it, and that the claims are not in the nature of a banker/customer relationship.
    Furthermore, Wema said the Originating Summons “is an improper and inappropriate process”, and that “the questions for determination are not within the ambit of interpretation/construction of any enactment or written instrument.”
    It said the issues alleged by the plaintiff are “triable” and cannot be resolved vide Originating Summons.

    Wema said it had no contractual or banker/customer relationship in respect of the transaction that is the suit’s subject matter.
    “The plaintiff was aware that its funds ‘the subject matter’ of this suit were with the second defendant against the backdrop that it introduced its external auditors, Messrs Akintola Williams Delolilte to the second defendant and not to the first defendant in three separate and distinct accounting financial years to wit: 2009, 2010, and 2011 for the purposes of ascertaining/confirming its account balances.”
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