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A Federal High Court sitting in Abuja has approved the placement of a winding-up petition advertisement against Dantata & Sawoe Construction Company Limited.
The petition is to appear in two national daily newspapers over an alleged $1,257,592.83 debt owed to Zutari Consulting Nigeria Ltd following a sub-contract work at the Dangote Fertilizer Plant project, in Lekki, Lagos, Nigeria.
The ruling was delivered by Justice Inyang Ekwo in a motion on notice filed by Zutari Consulting Nigeria Ltd(petitioner) against Dantata & Sawoe in SUIT NO: FHC/ABJ/ PET/ 3/2023.
The petitioner is involved in engineering designs, engineering consulting and supervision of engineering works while Dantata & Sawoe is into General Construction services, among others, according to court documents.
Petitioner’s Claims In its Court processes that the petitioner’s legal team submitted that their client was engaged by the respondent in 2015 in respect of some design work component of the respondent’s sub-contract work at Dangote Fertilizer Plant project, in Lekki, Lagos, Nigeria.
They contended that after the petitioner did its job, Dantata & Sawoe allegedly became indebted to it in the sum of: “a. $1,257,592.83, ZAR 2,136,623.39 and £4,364.38.”
They argued that due to the failure of the respondent to pay the petitioner the outstanding sum, a dispute arose between the parties and when the parties failed to resolve the same themselves, the dispute was submitted by the petitioner to the International Chamber of Commerce for arbitration.
The petitioner stated that arbitration was held in London, United Kingdom and a final arbitral award was made by the arbitration tribunal on April 7, 2021, finding that the respondent is liable to the applicant in the (debts) sums stated in its processes.
“To date the entire award sums remain fully unpaid and unsatisfied by the respondent,” the petitioner stated while urging the court in its main suit to approve the wound-up of Dantata and Sawoe because it is unable to pay its debts.
In addition, the petitioner filed a motion seeking the court’s permission to place its wind-up petition on national dailies in the interest of justice, pending the final decision of its main suit.
But in its notice of preliminary objection filed on 9th May 2023, the respondent urged the court to strike out the petition.
The legal team of Dantata & Sawoe argued that the conditions upon which the petitioner seeks winding-up of their client are totally lacking in merit.
In an affidavit deposed on 9th May 2023 by Sherwin Cayabyab, an employee of the respondent, he denied the indebtedness claimed by the petitioner.
He confirmed that his company engaged the services of the petitioner in a sub-contract at the Dangote Fertilizer Plant, Lekki Lagos for the sum of N162,000,000.00, and has paid the petitioner.
He explained however that the said sub-contract was varied as agreed by the petitioner, the respondent and Saipem (Dangote).
“The contract sum was increased and converted from naira to USD and the purported variation was intended to be presented to Saipem (Dangote) who eventually refused the variation on the basis that there was no additional work.
“In view of the said refusal, the Respondent turned around and made a claim against the Respondent/Applicant even when the Respondent/Applicant had paid the original contract sum of N162,000,000.00, ” the deponent explained.
He admitted the existence of the arbitral award that was made in favour of the petitioner/Respondent, adding it was “based on the purported variation of the sub-contract” which has been appealed against(subject of litigation).
The Respondent urged the court to refuse the application for winding up, in the interest of justice, insisting it is able to pay its debts.
What transpired in court
Ruling on their applications on Friday, Justice Inyang Ekwo said the objection of the respondent is made against the substantive matter and not against the motion on notice to advertise the petition.
He said contrary to Dantata & Sawoe’s submission, it is the law that a winding-up petition can go on despite the pendency of other processes as all that is required for the Petition to succeed is that the respondent the owes the petitioner a debt of N200,000 and above.
Ekwo said, having studied the petition, he “found the evidence of indebtedness of the respondent(Dantata and Sawoe)”, hence, he is satisfied to grant the motion seeking to place the wind-up petition on two national dailies.
Ekwo said “I am of the opinion that the preliminary objection of the Respondent/Applicant is rather premature at this stage of proceedings.
” It will only be ripe for hearing after the advertisement is ordered. It is only then that any person who intends to appear at the hearing of the petition, either to oppose or support must send notice of his intention to the Petitioner, or to his solicitor, within the manner prescribed by the Rule.
“I therefore make the following orders:
“An Order granting leave to the applicant to advertise the Winding-up Petition by one insertion in Two National daily newspapers being circulating nationally and within Abuja where the Respondent has its head office in compliance with the Companies Winding-up Rules 2001.
“The petition shall be advertised fifteen days before the next date of hearing.”
The judge directed that the advertisement shall state the particulars prescribed in Order 19 Rule (2) (c) of the Companies Winding-up Rules 2001.”
Order 19 Rule (2) (c) of the Companies Winding-up Rules 2001 provides that people should be notified about a wound-up case against a company so that decide to either support it or oppose it in court.
The aim of such an advert is for creditors to see that a company is unable to pay the debt owed.
Credit: Nairametrics
