6th July, 2015
Akin Kuponiyi
In a bid to recover a debt of N9.5 billion, Guaranty Trust Bank Plc. has sued the Managing Director/Chief Executive Officer of HI Media Limited (formerly known as HITV Limited), Oluwatoyin Subair, at a Lagos High Court, southwest Nigeria.
According to the statement of claim filed before the court by a Lagos lawyer, Chief Ajibola Aribisala (SAN) on behalf of Guaranty Trust bank, it was alleged that as at 31 January, 2012 HI Media Limited was indebted to the bank to the tune of N9,517,093,240.97 being the balance of the principal sum plus interest on the loan facilities granted the company by the bank.
The bank between 23 August, 2007 and 23 August, 2010, based on letter of offer and acceptance granted various loans, both in local and foreign currencies totalling about six billion naira.
The loans were acquired to provide guarantee for the purchase of additional TV content for the company’s sports channel to broadcast English Premier League, Champions League, Carling Cup, English FA Cup and UEFA games.
Part of the loan was also meant to finance the working capital and operational expenses such as establishment for reality show and to be used for the payment of services rendered by MTN, ETISALAT and other sponsors for advertisement to be shown during these foreign matches.
In furtherance of the acceptance of the aforementioned facilities, the company forwarded to the bank, its board of director’s resolution accepting the loan facilities.
The aforesaid credit facilities granted by the bank were personally guaranteed by Oluwatoyin Subair in a duly executed personal guarantee and indemnity while Kola Aluko, a director of HI Media also executed a separate personal guarantee and indemnity of the said loan facilities.
The defendant agreed that the guarantee shall extend to cover death, bankruptcy or liquidation of the company and all sums which would have been owed to the bank by the company if the events had occurred, notwithstanding such death, bankruptcy or liquidation of the company, all monies unpaid.
Consequently, in accordance with clause 16 of the said personal guarantee and indemnity the claimant through one of its officers, issued a certificate certifying that the company is indebted to the bank in the sum of N9,517,093,240.97 as at January 31st 2012 and that interest continues to accrue on same at the bank’s lending rate.
By virtue of a revenue collection agreement executed by the company and its subsidiary company Entertainment Highway Limited with the bank agreed to domicile all revenue generated by them in the bank from the date of execution until the liquidation of the entire facilities, but the company failed and refused to comply with its covenants and obligations to repay the credit facilities granted as at and when due as stipulated in the offer letters and the deed of all assets debentures.
Consequently, the bank averred that it cannot allow the flagrant breach of the defendants’ obligation to continue as the bank’s depositors and shareholders’ funds are at risk while its own liability as a financial institution established to provide banking services to the public is being severely threatened by the magnitude of the debt.
Therefore the claims of the bank against Oluwatoyin Subair are as follows: the sum of N9,517,093,240.97; interest on the said sum at the rate of 22% per annum till judgement is delivered and general damages against the defendant for failure to honour its obligations.
However, in his statement of defence filed before the court by his counsel Dr Joseph Nwobike(SAN), Oluwatoyin Subair while denying almost all the averment of the bank contends that there is no valid enforceable personal guarantee to sustain the allegation contained in the statement of claim of the bank against him, in addition HI Media is not indebted to the bank in the sum of N9,517,093,240.97 or any other sum as Guaranty Trust bank is a substantial shareholder in the company and one of the decision makers in the overall affairs of the company. As a result of this, it was not possible for him to take any decision without the consent and notification of the bank.
Subair alleged further that Guaranty Trust bank Plc, by reason of several agreements and undertakings between the bank and the company, the bank as financial adviser of the company became solo revenue collector, agent, banker right negotiator, and creditor which roles are inconsistent with the personal guarantee issued by the defendant.
Therefore, the suit he contended is unsustainable, frivolous and abusive of court process and ought to be dismissed.
The defendant also averred that by reason of the foregoing and the threat of the bank to enforce the personal guarantee against his interest and assets that himself and a Director of the Hi Media company Mr Kola Aluko instituted suit LD/1471/2011 against Guaranty Trust Bank and Segun Agbaje seeking to set aside the personal guarantee issued by them.
The defendant also said that in June 2008 when the bank granted to the company subsequent loan of N15,854 billion, the bank had acquired major share holding interest in the company and they did not personally guaranteed the loan as the facilities for which they gave personal guarantee has been paid back by the company. Therefore, they are fully discharged from the obligation connected with the loan therefore not personally liable.
Consequently, they urge the court to dismiss the suit as it was filed in bad faith and intended to harass and intimidate him.
Justice Oke-Lawal has adjourned for further hearing.