Supreme Court Restores Lawyers In $2bn Dispute
The Supreme Court has overturned the decision of the Court of Appeal that barred senior lawyers Wole Olanipekun and Muiz Banire from representing Neconde Energy Limited and Nestoil Limited in an ongoing $2 billion dispute.
In a unanimous judgment delivered by Justice Mohammed Baba Idris, the apex court ruled that companies retain the right to choose their own legal representation, especially when the legality of a receivership is being challenged.
The case centered on whether a receiver appointed by lenders could control the legal affairs of a company, even when the appointment itself is under dispute in court.
The Supreme Court held that such authority cannot be granted, stressing that it would create a conflict of interest for a receiver to determine legal representation in a case questioning his own appointment.
According to the court, the issues raised before the trial court go beyond routine management and directly challenge the validity of the receivership arrangement.
It noted that allowing a receiver in such circumstances to appoint counsel would undermine the fairness of the proceedings and compromise the company’s right to defend itself.
The court further explained that the powers granted to a receiver under existing laws do not extend to situations where the legitimacy of that role is being contested.
It ruled that companies still retain residual authority through their board of directors to manage their defence and engage lawyers of their choice.
The Supreme Court criticised the earlier decision of the Court of Appeal, describing it as flawed for giving the receiver exclusive control over legal representation.
The ruling restores Olanipekun and Banire as counsel in the dispute and provides clarity on corporate rights in cases involving receivership and creditor actions.