The Supreme Court has set aside an order of the Court of Appeal freezing the assets of Neconde Energy and Nestoil over an alleged $2billion indebtedness to FBNQuest Merchant Bank Limited and First Trustees Limited.
A five-member panel of the apex court in a judgment on Monday, held that the three-member panel of the appellate court went beyond its powers in granting an ex parte application against the oil firms.
Justice Stephen Adah in the lead judgment faulted the appellate court for assuming jurisdiction and issuing an injunction against Neconde and Nestoil, when the matter was not properly before it.
Besides, the Supreme Court accused the appellate court of misuse of the judicial process, particularly when the Court of Appeal, issued a stay of proceedings, disrupting the main case at the Federal High Court, Lagos Division.
The Apex Court held that granting an interim injunction when an appeal had not been entered was totally out of place and ‘misconceived.’ It added that the action of the Court of Appeal therefore amounted to having two courts handling same matter at the same time.
The Supreme Court further expressed dismay that the ex parte order by the Appeal Court was without any legal justification, adding it constitutes an misuse of judicial process.
Granting of ex parte orders, the Apex Court noted, had been a source of ‘legitimate concern’ at the trial courts, and now having the Court of Appeal join the fray is now even ‘more worrying.’ The five-member panel said there were special circumstances or any form of urgency warranting the Appellate Court’s granting of the ex parte order freezing the assets of the appellants.
The Apex Court thereby deemed the appeal of Neconde Energy and Nestoil as ‘meritorious’ and therefore ‘allowed’.
The dispute stems from debt recovery proceedings instituted by lenders, including FBNQuest Merchant Bank Limited and First Trustees Limited, against Nestoil and Neconde Energy over financing arrangements tied to oil assets and operations.
In October 2025, the Federal High Court in Lagos granted an ex parte Mareva injunction freezing the companies’ assets, bank accounts, and shares across more than 20 financial institutions.
However, the companies challenged the order, arguing that it automatically lapsed after 14 days under the Federal High Court Civil Procedure Rules once a motion to discharge it was filed.
On November 20, 2025, Justice Daniel Osiagor held that the ex parte order had expired by operation of law and was no longer subsisting.
On November 27, 2025 Justice Yargata Nimpar of the Court of Appeal, Lagos Division granted an interim restorative injunction that the control of Nestoil’s assets and operations returned to the receiver manager appointed by the banks.
He ruled that all steps Nestoil took after the November 20 ruling were set aside. The Mareva injunction continued to operate.
Monday’s Supreme Court verdict comes on the heels of an earlier one overturning an appellate court’s decision that the companies’ boards lacked the power to appoint counsel after the receivership took effect.
The Apex Court in the April 10 judgment
restored the companies’ right to retain counsel of their choice while challenging the validity of the receivership itself.
In the judgment, the apex court held that it as a “legal anomaly” for lawyers appointed by the receiver-manager to simultaneously represent the companies whose interests were being contested.
The court held that permitting such representation created a clear conflict of interest and undermined the companies’ right to independent legal representation.
Wole Olanipekun SAN for Neconde and Muiz Banire SAN were thereby restored to continue to represent their clients setting aside an Appellate Court’s January 10 judgment disqualifying them on grounds that the companies’ boards lacked the power to appoint counsel after the receivership took effect.
Nestoil Limited (an oil services firm) and its affiliate Neconde Energy Limited (which holds interests in Oil Mining Lease 42) are embroiled in a multibillion-dollar debt recovery suit filed by lenders, primarily FBNQuest Merchant Bank Limited and First Trustees Limited.
The lenders allege that Nestoil, Neconde, and their promoters (Ernest Azudialu-Obiejesi and Nnenna Azudialu-Obiejesi) owe over $2 billion (plus N430 billion in related liabilities) under financing arrangements, including a Common Terms Agreement.
Godfrey Eshiemoghie.
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