Friday, June 14, 2024

 

Alleged $4.6m Debt : When Police Act As Adjudicator And Recovery Agency in Civil Dispute

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Does the police have the legal backing to intervene in a purely civil matter, which parties have submitted themselves to arbitration and arbiter award granted with the subject matter of the dispute currently pending before the Federal High Court and the Court of Appeal, this is the puzzle begging for an answer.

This is exactly what the police have done when they filed a criminal charge at the Lagos Special Offences Court, Ikeja against the Chairman Chief Executive Officer of Lionstone Offshore Services Limited, Mr. Amaechi Ndili, his wife Njide and their company, Lionstone over a civil business dispute between their company, Lionstone Offshore Services Limited and Hercules Offshore Nigeria Limited.

Although Hercules Offshore Nigeria Limited no longer exists as the company the has been wound up under the United State bankruptcy law.

Police from the Special Fraud Unit, Ikoyi Lagos has in a charge before the Ikeja Special Offences Court alleged that Ndili, his wife Njide and their company, Lionstone, fraudulently converted $4.6 million said to belong to Hercules Offshore Nigeria Limited to their personal use, an issue which an Arbitration Tribunal in London has presided over and granted Award to one of the parties.

Apart from this, the matter is currently before the Federal High Court, Lagos and the Court of Appeal.

The crux of the matter which the police have transformed from civil to criminal arose from a joint business agreement signed by the two companies, Lionstone, a Nigerian Company and Hercules Offshore Limited an American company that decided to work together in the oil sector as a servicing company on a specific contract that would be won effective from the signing date of the agreement.

Under the Memorandum of understanding, MOU, parties agreed that all disputes that may arise in the course of the contract implementation under the MOU must be submitted to the Arbitration Tribunal in London.

Unfortunately, the parties were unable to win the contract which they envisaged and bidded for with ADDAX Petroleum under the MOU.

When parties failed to win the contract they bidded for under the MOU, Lionstone being a whole Nigerian company invited Hercules Offshore to come on board as technical partner and work with him on an earlier contract he had won with ADDAX long before their MEMO of incorporation was signed.

Under the new deal, both parties agreed to share the profit from the business relationship. However, while the business was going on, Lionstone alleged a breach of contract and good faith on the side of Hercules.

The disagreement eventually led both parties to submit themselves before the Arbitration Tribunal in London as contained in their MOU and at the end of its sitting, the Tribunal made its findings and granted the award to Hercules.

However, attempts by Hercules to register the Arbitration ruling at the Federal High Court, Lagos in order to make it enforceable in Nigeria led to a further dispute, as Lionstone alleged that Hercules Offshore was attempting to get judgement behind their back by not serving court process of the proceedings on them.

This created an issue before the court as Lionstone asked the court to vacate its earlier order the case was subsequently appealed and it’s currently pending before the Court of Appeal.

While the disagreement and litigation were ongoing in respect of this Hercules Offshore petitioned the Nigerian police alleging fraudulent conversion of money paid to Lionstone by ADDAX, under an Interim contract executed solely between Lionstone and Addax.

However, Lionstone denied the claim adding that Hercules never won any contract from ADDAX and that the latter could not paid Hercules for a non-existent relationship. Lionstone added that the only existing contract is between Lionstone and Addax, and the Joint Bidding Agreement contract between Lionstone and Hercules could never have become effective because the bid to Addax never materialised into a winning tender. And that in any event Hercules remained in breach of extant local content laws of Nigeria, which is subject to litigation at the time due to an alleged breach of MOU terms by Hercules.

Consequent upon the petition, police from the Special Fraud Unit, Ikoyi clamped down on all Lionstone’s accounts in Nigeria, while Lionstone on the other hand sued the police and Hercules for Tortious interference, claiming damages for injuries suffered by the unlawful interference of the Police in a civil dispute between the parties

Consequently, the police filed a charge against Amaechi Ndili, his wife Njide and their company, Lionstone Offshore Services Limited alleging fraudulent conversation of $4.6million

When the matter came up for trial last week, the trial judge, Justice Sherifat Solebo directed that the case file be returned to the Chief Judge of the Lagos State High Court for reassignment as she would not be able to complete the trial before her retirement.

The police had in the charge alleged that the defendants committed the said offences between July 2012 and September 2013.

The defendants were alleged to have dishonestly converted to their personal use, $4.6 million, which they received from Addax Petroleum Development Nig. Limited on behalf of Hercules Offshore Nig. Ltd.

The alleged offences according to the police contravene Sections 387 and 516 of the Criminal Code, Law, Cap C38, Laws of the Federation, 2004.

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