Court Dismisses Bankruptcy Case Against ex-Staco Insurance Boss

A Federal High Court in Lagos, has dismissed a bankruptcy
petition filed against the former Managing Director of Staco
Insurance PLC, Dr Sakiru Olanipekun Oyefeso. The court also awarded
costs of N50,000, against the Insurance firm that wrote the
petition against Oyefeso.

In its statement of facts, Staco Insurance had alleged that
while in office, the Managing Director/Chief Executive Officer of
the company, Dr Oyefeso obtained unauthorised loans in the name of
the company and converted same. He was also accused making illegal
expenditures to himself, his relatives and other third parties from
the funds of the company.

The company said the alleged irregularities were discovered in
the course of the forensic audit carried out by Ernst & Young, and
that despite repeated demands for payment, he has failed to pay,
and as at the date of filing the Petition, he owed the company
N575,943,276.70.

Consequently, the company as the creditor, urged the court to
issue an order declaring Oyefeso bankrupt. The creditor also sought
an order directing that all assets, interests, and his holdings,
either held personally or through third parties and privies, be
liquidated and the proceeds applied towards off-setting the
debtor’s debts, particularly the sum of N575,943,276.70. An order
divesting Oyefeso of all shares, interests and holdings in all
public and private companies. It also asked for an order of
perpetual injunction, restraining him from taking up appointment as
a Director in any company in Nigeria.

However, Oyefeso denied all the allegations. He stated that he
had for 25 years invested and dedicated himself to the company, as
the founding Managing Director and shareholder. He denied that he
was indebted to the company. He asked the court to dismiss the
suit, on the grounds that all the allegations against him were
false, contrived and biased.

He tendered and relied on a forensic report conducted on the
company by the National Insurance Commission (NAICOM).

Oyefeso said that the funds that the creditor alleged were loan,
were monies he personally provided to the company in order to
facilitate its business when required, and that the supposed loans
were repayments by the company to him as reimbursements.

He explained that some of the alleged unauthorised payments were
deferred benefits he was entitled to, and subsequently approved for
payment by other Directors, and for which other Directors were
similarly compensated. He told the court that all the allegations
were trumped up charges made against him, as a conspiracy to remove
him as the MD/CEO of the company at all cost.

His Lawyer, Mr Seni Adio, SAN, while asking the court to dismiss
the suit, argued that the company has no grounds to have his client
declared bankrupt.

In his judgement, Justice Nicholas Oweibo said “In this case,
there is an allegation by the creditor (Staco Insurance) that the
debtor Dr Sakiru Olanipekun Oyefeso is indebted to it in various
sums. Acts of bankruptcy which will entitle a creditor to file a
petition are listed in Section 1(1)(a)(I) of the Bankruptcy Act.
Looking at the evidence as given by the creditor, it is not the
case that the creditor has obtained any judgement or final order
against the debtor for the payment of the amount in issue. This
case cannot fit into paragraphs (b)-(h) of Section 1(1) of the
Act”.

“I am however of the opinion that, it is not sufficient to make
the allegation, there must be evidence to support same. Going by
the allegations made against the debtor, it cannot be said that the
acts of the debtor would constitute a debt in the true sense.

“The picture of the activities of the debtor painted above,
cannot in my mind, constitute a debt.

“I am not satisfied that there exists a debt, or that the debtor
committed acts of bankruptcy to entitle the creditor to reliefs
sought. The Petition is accordingly, dismissed. I award costs of
N50,000 in favour of the debtor.”

A Federal High Court in Lagos, has dismissed a bankruptcy
petition filed against the former Managing Director of Staco
Insurance PLC, Dr Sakiru Olanipekun Oyefeso. The court also awarded
costs of N50,000, against the Insurance firm that wrote the
petition against Oyefeso.

In its statement of facts, Staco Insurance had alleged that
while in office, the Managing Director/Chief Executive Officer of
the company, Dr Oyefeso obtained unauthorised loans in the name of
the company and converted same. He was also accused making illegal
expenditures to himself, his relatives and other third parties from
the funds of the company.

The company said the alleged irregularities were discovered in
the course of the forensic audit carried out by Ernst & Young, and
that despite repeated demands for payment, he has failed to pay,
and as at the date of filing the Petition, he owed the company
N575,943,276.70.

Consequently, the company as the creditor, urged the court to
issue an order declaring Oyefeso bankrupt. The creditor also sought
an order directing that all assets, interests, and his holdings,
either held personally or through third parties and privies, be
liquidated and the proceeds applied towards off-setting the
debtor’s debts, particularly the sum of N575,943,276.70. An order
divesting Oyefeso of all shares, interests and holdings in all
public and private companies. It also asked for an order of
perpetual injunction, restraining him from taking up appointment as
a Director in any company in Nigeria.

However, Oyefeso denied all the allegations. He stated that he
had for 25 years invested and dedicated himself to the company, as
the founding Managing Director and shareholder. He denied that he
was indebted to the company. He asked the court to dismiss the
suit, on the grounds that all the allegations against him were
false, contrived and biased.

He tendered and relied on a forensic report conducted on the
company by the National Insurance Commission (NAICOM).

Oyefeso said that the funds that the creditor alleged were loan,
were monies he personally provided to the company in order to
facilitate its business when required, and that the supposed loans
were repayments by the company to him as reimbursements.

He explained that some of the alleged unauthorised payments were
deferred benefits he was entitled to, and subsequently approved for
payment by other Directors, and for which other Directors were
similarly compensated. He told the court that all the allegations
were trumped up charges made against him, as a conspiracy to remove
him as the MD/CEO of the company at all cost.

His Lawyer, Mr Seni Adio, SAN, while asking the court to dismiss
the suit, argued that the company has no grounds to have his client
declared bankrupt.

In his judgement, Justice Nicholas Oweibo said “In this case,
there is an allegation by the creditor (Staco Insurance) that the
debtor Dr Sakiru Olanipekun Oyefeso is indebted to it in various
sums. Acts of bankruptcy which will entitle a creditor to file a
petition are listed in Section 1(1)(a)(I) of the Bankruptcy Act.
Looking at the evidence as given by the creditor, it is not the
case that the creditor has obtained any judgement or final order
against the debtor for the payment of the amount in issue. This
case cannot fit into paragraphs (b)-(h) of Section 1(1) of the
Act”.

“I am however of the opinion that, it is not sufficient to make
the allegation, there must be evidence to support same. Going by
the allegations made against the debtor, it cannot be said that the
acts of the debtor would constitute a debt in the true sense.

“The picture of the activities of the debtor painted above,
cannot in my mind, constitute a debt.

“I am not satisfied that there exists a debt, or that the debtor
committed acts of bankruptcy to entitle the creditor to reliefs
sought. The Petition is accordingly, dismissed. I award costs of
N50,000 in favour of the debtor.”