Stanbic IBTC Bank Plc dragged to court for breach of trust
*Matter adjourned till 5th of June, 2017
Infinity Snacks and Beverages Limited, an aggrieved customer of Stanbic IBTC Bank Plc, has dragged the bank before a Federal high court in Lagos over an alleged breach of contract which has led the company into economic misfortune.
In a statement of claim by his lawyer, Barrister Olumide Sofowora (SAN), Infinity Snacks and Beverages Limited alleged that in July 2014, it applied for a loan for its factory expansion from Bank of Industry Limited and it received approval for the sum of N934,029,835 on 19th August 2014.
However, one of the conditions for granting of the facility was the provision of a bank guarantee, the company then requested Stanbic IBTC Bank Plc to start processing the bank guarantee. However, apart from the unnecessary delay exhibited by the bank, Stanbic IBTC Bank Plc, requested that before the bank guarantee can be provided the company should clear one of the existing loans to the tune of N50million, all other outstanding loans and interest due to the bank should be noted on debenture.
Infinity Snacks and Beverages Limited claimed it satisfied all these requirements, yet the financial institution’s guarantee was not issued until 22nd of December 2015, about four months after the approval of the loan by the Bank of Industry. The company further alleged that the Bank of Industry disbursed the sum of N864,420,000 into the bank’s account in the company‘s name on 9th of May, 2016, but Stanbic IBTC Bank Plc did not inform the company until 17th of May 2016.
The company immediately embarked upon ensuring that the loan was utilised by mandating the bank to bid for foreign exchange for the purchase of the needed machinery for its expansion. At first, the bank continued to put stumbling blocks along the way by tying the Bank of Industry loan to its own loan portfolio granted to the company.
When the bank finally agreed to bid for the needed foreign exchange, the company alleged that Stanbic IBTC Bank Plc said there was no foreign exchange supply in the market; only for Infinity Snacks and Beverages Limited to discover that the bank’s promises to secure foreign exchange for the company were all ploys to frustrate the company from benefiting from the Bank of Industry facility of N864.420 million because apart from bidding for and obtaining foreign exchange for some of its customers who applied for foreign exchange during the same period, the bank was supporting one of Infinity Snacks and Beverages Limited’s competitors, Multipro Enterprises Limited who are the Franchisees of Kellogs Breakfast Cereals in Nigeria.
The plaintiff further alleged that Stanbic IBTC Bank actually applied on behalf of Multipro Enterprises Limited for the same Bank of Industry facility.
The plaintiff is contending that the delay on the part of the bank to provide the bank guarantee caused the company severe loss as the rate of foreign exchange to the Nigerian currency rose drastically during the period due to Federal Government deregulation of foreign exchange market, aside that the bank unilaterally increased the bid rate from N 280 to $1 to N 288 to $1.
The company also alleged that Stanbic IBTC bank breached its duty of care to it and committed several other breaches of contact due to negligence by its refusal to carry out the company’s several instructions and by its decision to place a lien on the company ‘s funds which amounts to an unauthorized freezing of the company’s account without lawful authorisation and trading with N864.420million meant for the expansion of the company’s business for several months without payment of any interest whatsoever.
Infinity Snacks and Beverages Limited said it held meeting with the bank with a view to placing the N864.420millon in an interest yielding account, the bank promise to revert to the company on the issue but it never did and kept silent on the matter permanently.
Infinity Snacks and Beverages Limited company is also urging the court to declare that by promoting the business of the company’s competitor whilst frustrating its own business which led the company to sustain loses in its business, the bank has breached its fiduciary duty to the company thereby entitling it to damages.
Consequently, in view of the alleged several breaches of the bank in its duty care to the company the company is demanding for special damages in the sum of N2,076,801,430.42.
Presiding Judge, A. M. Lawal adjourned the suit till 5th of June, 2017.