Free Zone Utilities Lftz Enterprise v Bancore Global Services Limited & Ors

On 4^th November 2024 Master Eastman made an order granting permission to register a judgment of the High Court of Lagos State, Lagos Judicial Division, Nigeria [“the Nigerian judgment”] against the three Defendants. The registration of the Nigerian judgment is permissible under the Administration of Justice Act 1920 and as provided for under CPR r.74.6.

On 17^th December 2024, the Claimant and the Second Defendant agreed a 28 day extension to the deadline recorded at paragraph 3 of the Registration Order – i.e., giving the Second Defendant until 17^th January 2025 to file any application. The consent order was sealed on 18^th December 2024.

By application issued on 23^rd January 2025, the Second Defendant applies for an order that the said registration order be set aside. I understand that there has been no appeal against the Nigerian judgment in Nigeria.

I must state at the outset that I am grateful for the written and oral submissions of the advocates: Mr. Paul Onifade, solicitor advocate for the Claimant and Ms Katharine Bailey, of counsel, for the Second Defendant. Their written submissions should be read with this judgment. I hope that I shall be forgiven for not rehearsing the arguments in full.

I should add that I have had the benefit of reading the Second Defendant’s witness statement dated the 17^th January 2025; a witness statement by Mr David Phillips in support of the application; a witness statement by Mr, Onifade dated 7^th March 2025; and two witness statements by Ademola Animashaun (“Demola”) who is the Claimant’s attorney in Nigeria.

Mr. Phillips’ witness statement seeks to rely on a report prepared by Detail Commercial Solicitors [“DCS”] in support of the set aside application. I have to decide whether or not the Second Defendant should have permission to rely on the report.

The Claimant is a registered company under the Nigerian Export Processing Zones Act 2004 with registration no. 0560. The Claimant is an employer of expatriates, and their salaries are paid in US Dollars. The First Defendant is a limited liability company incorporated under the Nigerian Companies and Allied Matters Act 1990. It advertises itself as a Fintech company with global and international affiliations and a licensed international money transfer operator (IMTO) engaged in international money transfer business in U.K., Nigeria and other parts of the world. The First Defendant was able to offer currency swap for retail and business use with its global headquarters in England.

The Second Defendant states that as a major shareholder in the Danish parent company he had helped set up the Nigerian business and had agreed to act as the non-executive chairman of Bancore, but that he never visited Nigeria and was never involved in the day-to-day operations of the company.

The Second Defendant is the chairman and director of the First Defendant. According to the Claimant he is the alter ego and controlling mind of the First Defendant. The Second Defendant is resident in England. The Third Defendant (no relation to the Second Defendant) is also a director of the First Defendant. He is resident in Denmark.

The Claimant and the First Defendant entered into an agreement that upon being paid NGN 716 243,000 at the rate NGN 566.20 to $1.00 USD, it would exchange the sum of USD $1,265,000 for the Claimant. Between 22nd and 26th October 2021, and pursuant to the agreement, the Claimant paid the aggregate sum of NGN 716,243,000 to the First Defendant. The funds were for the purpose of the Claimant’s expatriate salary, utility and supply needs. The First Defendant was obliged to deliver the $1,265,000 within approximately one week of 26 October 2021.

The First Defendant failed to make any payment to the Claimant. On the 21^st December 2021 both the Second and Third Defendant signed a letter on behalf of the First Defendant acknowledging the outstanding debt of $1,265,000 to be repaid in three instalments. The Second Defendant signed the letter as chairman of the First Defendant [“Bancore”]. On the 22^nd December 2021 a board resolution of Bancore AS (Denmark) approving the proposed payment plan was passed and communicated to the Claimant. The Second Defendant signed the resolution as chairman of Bancore AS.

The Claimant accepted the repayment terms but no payments were made by the First Defendant. Instead, the Second Defendant paid $305,000 from his personal account: $190,000 on 13^th January 2022; $105,000 on 15^th February 2022 and $10,000 on 19^th March 2022. These payments left an outstanding debt of $960,000.

By an agreement dated 14^th July 2022 made between the Claimant, the First and Second Defendant, the parties agreed a repayment schedule in respect of the outstanding $960,000. I note that the Second Defendant, described as a shareholder, director and beneficial owner of the First Defendant, assured the Claimant of the First Defendant’s intention to meet its financial obligation under this agreement. The Second Defendant was not assuming a personal liability to repay – at any rate at this stage.

By a writ dated 25^th March 2024, the Claimant commenced proceedings in Nigeria to recover the full amount of $960,000.00 from the Defendants. The pre-action protocol letter dated 7 February 2024 was served by email and also by personal delivery to the Second Defendant. The Claim was subsequently filed and served by courier on the Defendants.

No repayment was made. However, the parties agreed to settle out of court and this resulted in the Terms of Settlement which was signed by both parties on 6 May 2024. The Defendants made no further payment.

It is necessary to consider the Terms of the Settlement agreement and at how matters proceeded in the Nigerian court.

Clause 1 of the Terms of Settlement dated 6^th May 2024 sets out various recitals. Clauses 2-6 state:

The terms of settlement are signed on behalf of the Claimant and by the Second Defendant “for and on behalf of the Defendants”.

It is clear from the Terms of Settlement that the Second Defendant was assuming a personal liability to pay the Claimant $576,000 and that the settlement terms would be made a judgment of the Nigerian court. Put another way, the Second Defendant was aware that the Nigerian Court would be involved.

In view of submissions made on behalf of the Second Defendant (see below), it is helpful at this point to read the email sent by the Second Defendant to Demola on 6^th May 2024 with the subject “Our Settlement BGS – Freezone Utilities”. The email states:

Demola replied briefly stating that he required two originals and that he would arrange for collection tomorrow or next.

The Terms of Settlement were filed at the Nigerian court on 16^th May 2024 and on 30^th May 2024 the Nigerian court made an order in the following terms.

As far as the hearing on the 30^th May 2024 is concerned, this was not attended by the Defendants the Claimant being represented by counsel. I deal with the nature of the “hearing” below.

Against this background, I turn to the application to set aside the registration order.

S.9(2) of the 1920 Act sets out limitations on the judgments to be registered. It states:

No judgment shall be ordered to be registered under this section if—

the original court acted without jurisdiction; or

the judgment was obtained by fraud; or

The Second Defendant submits that the Nigerian Court lacked jurisdiction to make the judgment order. I accept that the Second Defendant was not ordinarily resident in Nigeria, but I do consider that he was carrying on a business in Nigeria, namely the running of the First Defendant’s business even if this did not involve day to day management. (Footnote: ²) In any event, even if I am wrong in this, on the facts stated above there was an undoubted submission or agreement to submit to the jurisdiction of the Nigerian court.

The Second Defendant makes the point that he did not have notice of “the hearing” on 30^th May 2024 and that the hearing was listed to validate service. As I understand it, there was a hearing on 30^th April 2024 in relation to the Claimant’s application concerning concurrent writs. The application was put back to 30^th May 2024. As stated above, at the 30^th May 2024 hearing, the Claimant was able to submit the agreed Terms of Settlement. In my judgment there was no procedural unfairness here and what happened on 30^th May 2024 was what the parties had agreed should happen albeit without a specific date for the lodging of the Terms of Settlement. That the hearing was listed to validate service of concurrent writs is irrelevant in my view. There was no breach of natural justice.

In the circumstances of this case it was not necessary for the Nigerian court or the Claimant to give the Second Defendant notice of the attendance or hearing on 30^th May 2024. There was no hearing in the proper sense of the word. What we have is, as the parties agreed, was a filing or lodging of the Settlement Terms,

The Second Defendant challenges the validity of the Terms of Settlement. He states that when he signed it he was 83 years old and still in recovery from major surgery. He alleges that at a meeting on 7^th February 2024 he and Demola had a meeting at the Second Defendant’s home. The Second Defendant alleges that Demola told him that his signature meant that he was merely agreeing with the figures, not that he was agreeing to be seen as the main judgment debtor. He states that he was not shown any documents at this meeting. The Second Defendant states that he never intended to assume any personal liability.

In my judgment the Second Defendant’s challenges to the validity of the Terms of Settlement cannot be sustained. The Second Defendant’s email of 6^th May 2024 demonstrates Demola did not attend a meeting as the Second Defendant alleges and did not misrepresent the terms of the agreement. The email demonstrates that the Second Defendant was fully aware of what had been agreed and had time to consider the settlement document.

I consider that the Second Defendant is bound by his signature on the Terms of the Settlement and that there is no scope for any argument about fraud, undue influence or misrepresentation.

I accept that there was a time when the Second Defendant did not wish to assume any personal liability for the First Defendant’s debt (Footnote: ³) but the Terms of Settlement are clear. (Footnote: ⁴)

The Second Defendant (via the DCS report) challenges the Claimant’s capacity to sue. I find that the Claimant is a body corporate and a juristic personality. I accept the Claimant’s submission that it is inconceivable that the law would enable the Claimant to enter into a contract but not allow it to enforce the contract.

I remind myself that Section 9(1) of the 1920 Act is discretionary. I am satisfied that the judgment should be registered as in all the circumstances of the case it just and convenient that the judgment should be enforced in the United Kingdom. There are no public policy grounds which impede registration.

As far as the DCS report is concerned, I have read the report and refuse permission for the Second Defendant to rely on it. The report is not Part 35 compliant and is not reasonably required to resolve the proceedings. The report rehearses the general grounds upon which the registration order maybe set aside but is not sufficiently fact specific to assist. The report does not consider the 6^th May 2024 email. The report countenances fraud and misrepresentation when this is wholly unrealistic.

In conclusion, I will dismiss the Second Defendant’s application.

A draft judgment was sent to the parties on 1^st May 2025.