The Court of Appeal, Lagos Division, has nullified a decade-old ruling that granted Guaranty Trust Bank Plc (GTBank) the right to foreclose on a luxury property in Ikoyi, Lagos, reportedly valued at ₦30 billion. The 44-room mansion belongs to Alhaji Agboola Abiola, the son of the late business magnate and acclaimed political figure, Chief M.K.O. Abiola.
This development stems from a successful appeal against the Federal High Court’s 2014 decision, which had previously empowered the bank to enforce a tripartite legal mortgage allegedly securing loans totalling over ₦1.5 billion.
Court of Appeal Flags Serious Mortgage Deficiencies
In its unanimous judgment, the appellate court panel—led by Justice Paul Aimee Bassi, with Justices Polycarp Kwahar and Abdulaziz Anka concurring—criticised the Federal High Court for failing to give due weight to critical allegations of fraud and forgery raised by the appellants.
At the heart of the case was whether a valid legal mortgage existed and whether GTBank’s reliance on a contested deed was lawful. Justice Bassi ruled that the bank’s mortgage instrument was so riddled with inconsistencies that it could not form a legitimate basis for foreclosure.
Forgery Allegations and Dubious Document Execution
The appeal was lodged by RCN Networks Ltd and Agboola Abiola, both represented by Senior Advocate of Nigeria (SAN), Dr. Charles Adeogun-Phillips. While the first appellant accepted that a deed of mortgage had been executed, the second appellant, Abiola, firmly denied affixing his signature to the document.
According to Abiola, the page carrying his supposed signature was fraudulently extracted from an entirely different agreement and appended to the mortgage deed. The appellants also accused GTBank of merging two unrelated loan facilities—one for ₦508 million and another for ₦1 billion—without their approval, effectively using one execution page to secure two transactions.
Police Inquiries Inconclusive, But Red Flags Persist
Although the forgery claims were subjected to police investigation, the outcomes were inconclusive. One report called for arbitration between the disputing parties, while another appeared to dismiss the forgery allegations outright.
Nevertheless, the appellate court held that these findings did not dispel the reasonable doubts surrounding the authenticity of the document. Justice Bassi highlighted clear irregularities, particularly in the way the deed was paginated. While the main body of the document was numbered “2 of 9” through “9 of 9,” the signature page was marked “11 of 17”—suggesting it belonged to a completely different document.
Lower Court Criticised for Overlooking Key Evidence
The appeal court sharply criticised the trial judge for ignoring these glaring discrepancies and instead focusing narrowly on Clause 6 of the mortgage deed to determine the bank’s rights. According to Justice Bassi, a document that is under serious dispute over its authenticity cannot serve as the foundation for legally binding decisions.
In his conclusion, Justice Bassi declared, “The lower court erred by ruling on a document whose authenticity was seriously in question. This appeal succeeds. The judgment of the lower court dated June 20, 2014, is hereby set aside. Parties shall bear their respective costs.”
Implications for Legal Practice and Financial Institutions
The judgment underscores the importance of proper documentation and verification in the execution of legal instruments, particularly in high-value financial transactions. It also serves as a cautionary tale for financial institutions relying on potentially flawed or contested documents in their debt recovery efforts.
As both parties return to the legal drawing board, the case raises significant questions about due process, the integrity of financial instruments, and the evidentiary standards required in foreclosure proceedings.