Loan Default: Court orders Cross River to repay $6.5m with interest to ECOWAS Bank
The ECOWAS Court of Justice has ordered the government of Nigeria’s Cross River State (CRSG) to repay the sum of USD6, 455,846 and an interest of 6.5% per annum starting from 31st August, 2018 to the ECOWAS Bank for Investment and Development (EBID) being the amount outstanding from a loan granted the government in 2005.
Delivering judgment on Friday, 5th February 2021 in a suit brought by the bank, a financial institution and arm of ECOWAS, Honourable Justice Edward Amoako Asante who delivered the judgment, said the “sum represents the situation of the Tinapa Free Zone Project loan in the Applicant’s book as at 31st August 2018.
He asked the government of Cross River to submit to the Court within two months a report on its measures to implement the Court’s orders relating to the loan with which the government financed the Tinapa business resort.
Although the Court granted most of the reliefs sought by the Applicant, it declined the Applicant’s claim for immediate execution of the Irrevocable Standing Payment Order (ISPO) a loan condition precedent mandating the Accountant General of the Federal Republic of Nigeria tagged “Guarantee” in Clause 7.05 of the loan agreement to satisfy the indebtedness.
The Court also refused to grant the Applicant’s claim for solicitor’s fees on the ground that it was not backed by documentary evidence.
The Applicant EBID had filed suit no ECW/CCJ/APP/14/19 on 2nd April, 2019 urging the Court to declare its Loan Agreement No 7/AP/LAR/FRDF/04/05 with CRSG as valid, binding and subsisting between the parties; declare the Respondent as having failed to fulfil a loan condition precedent and compel the Respondent to repay the loan with interest.
The Applicant had alleged that despite several demands, the Respondent refused and or neglected to repay the loan with duration period of seven (7) years after a two-year moratorium.
The Respondent, Government of the Cross River State of the Federal Republic of Nigeria admitted it approached EBID an investment and development bank to part finance its TINAPA business and resort project located near its Calabar Free Trade Zone, and that both parties signed a loan agreement on 20th May 2005 for a sum of UA6, 525,371 equivalent of USD10, 000,000.
The Respondent claimed it made repayments until 2010 when it defaulted due to an administrative issue and that the repayment schedule for the outstanding payment of UA5, 692,376 was restructured to run from 7 January 2010 to 1 January 2020. The Responded added that it paid instalments totalling UA3, 277,080 by 1 January 2014.
But the Court noted that the Respondent defaulted on its repayment schedules.
Also on the panel for the suit were honourable Justices Gberi-Be Ouattara and Januaria Moreira Costa.
In suit no ECW/CCJ/APP/43/20 filed by a Venezuelan detained by the government of the Republic of Cape Verde in response to an extradition request by the government of the United States, the Court fixed 11th March 2021 for judgment in the case filed by Venezuelan, Mr Alex Saab, challenging his detention.
The Applicant Alex Saab, a Venezuelan who was detained during a refuelling stopover of the aircraft in which he was travelling, initiated an application against the government of Cape Verde challenging his detention pending extradition at the request of the United States of America.
Mr Saab through his counsel Mr Femi Falana argued that as a special envoy on a diplomatic mission, he ought not to be arrested and detained by the Cape Verdean authorities.
The Respondent submitted that the arrest and detention of the Applicant pending his extradition was carried out based on the general principles of international judicial cooperation in criminal matters, in strict compliance with the provisions of Arts. 3 and 4 of Act no. 6/VIII/2011, of 29 August and that it is not in violation of Cape Verdean law or any international agreement, treaty or convention to which the country is a party.
The Respondent also averred that the Applicant did not meet the requirements qualifying him as a special envoy with the associated immunities.
The Court had in its Ruling delivered on 20th December 2020 ordered the Republic of Cape Verde to place the detained Applicant under permanent home detention in good conditions including access to medical treatment and visits.
The Court also ordered that the Applicant should not be extradited pending the decision of the Court on the substantive matter.
The matter was adjudicated by three member panel comprising Honourable Justices Edward Amoako Asante, Dupe Atoki and Januaria Moreira Costa.