Ex-Reps member`s firm drags Akwa Ibom to court, demands N350m

…Company alleges breach of contract

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NIGERIA: A COMPANY owned by a former member of the House of Representatives has sued the Akwa Ibom State government, demanding N350 million as damages for breach of contract.

Bond Investment and Holdings Limited, owned by Chief Bode Mustapha, who once represented Abeokuta North, Odeda and Obafemi/Owode Federal Constituency from Ogun State, wants the Federal High Court in Abuja to adjudicate over its grievances against the Akwa Ibom government.

The disagreement between the plaintiff and the defendant was based on the breach of consultancy agreement by the Akwa Ibom administration against the company, which handled a project on recovery of all excess deductions/charges on loan facilities taken since the creation of the state.

Eminent lawyer, Chief Afe Babalola (SAN) filed the suit number CV/2524/16, which also joined the state Attorney General, at the Federal High Court in Abuja on behalf of the peeved company.

Babalola explained in the statement of claim that his client averred that a consultancy agreement dated June 30, 2010 was entered into with the first defendant (Akwa Ibom government) for the reconciliation and recovery of all excess deductions/charges on foreign loan facilities taken by the state since its creation.

According to the writ of summon, the plaintiff further averred that in exchange for its services, it would to be paid 15 percent of any amount recovered net of withholding tax and value added tax in the currency of refund within 15 days of receipt of refund by the 1st defendant.

The lawyer also said that his client in line with the pact carried out the job at the office of the Accountant-General of the Federation, Debt Management Office and Federal Ministry of Finance which are all situated in Abuja, Federal Capital Territory.

The plaintiff, according to the counsel, stated that the agreement was tentatively for one year from June 30, 2010 to June 29, 2011, but that through a letter dated July 13, 2010 addressed to the Director General of Debt Management Office, it submitted details of the 1st defendant external debt payments from 1982 to 2007 and also profiled the deductions made within the same period.

The plaintiff, the counsel further explained, stated that via a letter dated December 9, 2010, it informed the 1st defendant that its ongoing reconciliation with the Debt Management Office and the Federal Ministry of Finance had resulted in a review of the London Club buy-backs of 1992, 2002 and 2006 and that based on this review it was clear that the 1st defendant was entitled to be refunded the sum of USD 61,277,096.07.

The plaintiff also stated that through a letter dated December 24, 2010, it informed the 1st defendant that the nation`s President had approved the payment of USD 61,277,096.07 to the 1st defendant as refund on the London Club excess deductions on buybacks.

According to the firm, USD 61,277,096.07 was remitted to the 1st defendant by the Federal Government due to its efforts, which necessitated the need to be paid 15 percent of the amount refunded to the 1st defendant as provided for in the pact.

The counsel further stated in the writ that the 1st defendant refused till date to pay the‎ plaintiff despite several oral and written demands made to it.

The explanations and the demands of the plaintiff were contained in the 47 points statement of claim containing 23 pages, dated September 15, 2016.

Babalola declared that his client had fulfilled their contractual agreement by ensuring and facilitating the recovery of the excess deductions, charges on foreign loan facilities taken by the defendants since its creation, totalling USD 61,277,096.07 from the Federal Government.

To assuage his client, Babalola urged the court to grant an order directing the defendants to immediately pay USD 9,191,564.41 being 15 percent of the total refunded money to the company.

He also prayed the court to grant N350 million compensation as penalty for general damages for breach of contract and the cost of inconveniences, travelling, communicating with the defendants in order to convince them to pay the plaintiff, its fee, and interest at the rate of 10 percent annually from the date of judgement till same is liquidated.