A Federal High Court in Lagos has ruled that Honeywell Group Plc‘s payment of N3.5 billion between 2013 and 2014 constitutes the full and final settlement of its indebtedness to Ecobank Nigeria Limited.
Reason for the Ruling: While making his ruling, Justice Olayinka Faji noted that a valid agreement was reached at various meetings between representatives of Honeywell and Ecobank. It was based on the outcome of the meetings that Honeywell made the final payments to the bank.
The Justice went further to stress that while Honeywell held on to its end of the bargain, the same cannot be said for Ecobank who, rather than keep to the terms of the agreement, sought to introduce new terms.
According to a press statement obtained by Nairametrics, the bank did not raise any objections all through the time Honeywell made repaid the debts in installments. The additional amount that was later claimed by the bank was not at any point mentioned in the course of the meetings and a series of correspondence between the companies.
The Backstory: The protracted lawsuit was instituted by Anchorage Leisures Ltd, Honeywell Flour Mills Plc, and Siloam Global Limited (all members of the Honeywell Group), in August 2015. The aim was to determine whether or not the companies still owed Ecobank following the payment of the sum of N3.5 billion as the full and final settlement of their obligations to the bank. Note that this payment was based on a mutual agreement between the companies.
Apparently, the agreement required Honeywell and its subsidiaries to pay the bank the sum of N3.5 billion; albeit in installments. According to Honeywell’s Head of Treasury and Finance, Oluwakemi Owasanoye, the company complied with the agreement. However, after completing the payment, Ecobank proceeded to demand for further payments in respect of the debt which had been fully liquidated for over a year.
Ecobank’s Position: While being cross-examined prior to Justice Faji’s ruling in favour of Honeywell, Ecobank’s Head of Corporate Communications, Mr Elemi Agbor, was supposedly unable to substantiate Ecobank’s claim/demand.