Treasure Capital and Trusts Limited, a financial services operator and a leading brand in securities trading, has slammed a N5.45 billion law suit on United Bank for Africa Plc in Suit No. LD/464/2013 for loss of income it suffered as a consequence of the mareva injunction wrongfully procured and executed against it by the bank.
UBA was said to have in 2011 instituted a suit against Mobil Workers (Eket) Multi-Purpose Co-operative Society Limited in which the bank joined Treasure Capital & Trusts Limited as a co-defendant in Suit No.FHC/L/CS/697/2011: United Bank for Africa Plc vs Mobil Workers (EKET) Multi-purpose Cooperative Society Limited and 4 others.
The bank was said to have sued for enforcement of outstanding indebtedness of Mobil Workers (Eket) Multi-Purpose Co- operative Society Limited to it.
However, Treasure Capital and Trusts was joined as a co-defendant in the suit by the bank in what the company described as the total lack of privity of contract in Treasure Capital & Trusts Limited in respect of the relationship between the bank and Mobil Workers (Eket) Multi-Purpose Co-operative Society Limited.
It was gathered that subsequent to the institution of the law suit, UBA Plc applied for both interim and interlocutory mareva injunctions against the defendants in the suit including Treasure Capital & Trusts Limited.
The mareva injunction was to freeze the assets of Treasure Capital & Trusts Limited including all such funds standing to its credit with Ecobank Plc, Zenith Bank Plc, First Bank Plc, Oceanic Bank Plc, Fidelity Bank Plc, Guaranty Trust Bank Plc, Sterling Bank Plc, First City Monument Bank Plc and Bank PHB Plc.
In the applications, UBA was said to have given undertakings to indemnify the respondents in the applications including Treasure Capital & Trusts Limited, in damages if it turns out that the applications for mareva injunctions ought not to have been made in the first place.
Consistent with the reliefs sought in the applications and further emboldened by the undertakings as to damages, the Federal High Court, Lagos granted the orders of interim and interlocutory mareva injunctions against Treasure Capital & Trusts Limited.
However, disturbed by the orders of mareva injunction against it when in fact there was no reasonable cause of action disclosed in the suit against Treasure Capital & Trusts Limited, the latter applied to the court to strike out its name from the suit for non-disclosure of reasonable cause of action against it and for lack of jurisdiction on the Federal High Court.
After a painstaking review of UBA’s claim in the suit, the court struck out the name of Treasure Capital & Trusts Limited from the suit confirming that the order of mareva injunctions ought not to have been made against the company.
It was gathered that before the mareva injuctions were lifted from the company’s name by the court, Treasure Capital’s business was completely shut down for a period of about two years owing to inability to perform any transaction on the affected accounts.
The company said it was unable to conduct its businesses as its entire accounts were suspended and all on-going transactions were truncated as there was no account to settle its transactions. “Treasure Capital & Trusts Limited was exposed to huge financial loss of about N5.45 billion as a consequence of the mareva injunctions granted against it,” a source said.
According to the source, Treasure Capital & Trusts Limited instituted the said suit with No. LD/464/2013 against UBA Plc to enforce the undertaking as to damages given by the bank.
The undertaking as to damages is to restore the affected party, as much as money can compensate, to the financial position that the affected party would have been but for the mareva injunction.