Proceedings at the Federal High Court in Lagos were stalled on Friday after Nestoil Limited, Neconde Energy Limited, and their promoters accused a judge, D.I. Dipeolu, of bias and judicial misconduct.
The companies filed petitions on 3 November with the National Judicial Council (NJC) and the Federal High Court Chief Judge, requesting that ongoing suits, including suit FHC/L/CS/2127/2025, be reassigned to another judge pending review.
The suit, filed by FBNQuest Merchant Bank Limited and First Trustees Limited, seeks to appoint a receiver over Nestoil’s assets.
According to certified court documents shared with PREMIUM TIMES on Monday, the dispute arose from claims that Nestoil and Neconde owed over US$1 billion and N430 billion as of 30 September.
In October, this newspaper reported that armed police officers sealed the Lagos headquarters of Nestoil Limited following a Federal High Court order authorising First Trustees and its subsidiary, FBNQuest Merchant Bank, to take over the company’s assets due to an alleged multibillion-dollar debt default.
Court orders
Acting on an ex parte motion filed on 20 October, the court empowered a court-appointed Receiver, Abubakar Sulu-Gambari, a Senior Advocate of Nigeria (SAN), to take control of the companies’ assets.
The ruling also authorised law enforcement agencies, including the Nigerian Police, Nigerian Navy, and the State Security Services (SSS), to assist in executing the court’s directives.
The applicants asked the court to grant a Mareva injunction restraining the companies and their executives from accessing or operating any of their funds or shares in Nigerian financial institutions.
They also sought to restrain the executives from accessing accounts holding approximately US$486 million and N390 billion, which they personally guaranteed.
The motion requested judicial protection for the court-appointed receiver to carry out his duties without interference.
It further asked the court to authorise the receiver to take possession of Nestoil and Neconde offices at 41–42 Akin Adesola Street, Victoria Island, Lagos, and to manage Neconde’s interest in the OML 42 joint venture.
The applicants asked the court to grant the receiver powers to preserve all other assets within the court’s jurisdiction and requested security support from federal and state law enforcement agencies to assist the receiver in executing the court’s orders.
The motion also demanded full cooperation from regulatory authorities, including the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), NNPC Exploration and Production Ltd, and other NNPC subsidiaries, to allow the receiver to access, produce, sell, and collect proceeds from hydrocarbons.
Additionally, the applicants asked the court to permit the receiver to publish statutory notices about the receivership in national newspapers and sought an order compelling all parties holding the defendants’ shares, assets, or funds to provide sworn disclosure within seven days.
Ruling
Justice Dipeolu granted the motion in part, freezing the accounts and assets of the companies and giving Mr Sulu-Gambari broad powers to manage and preserve the assets, including the OML 42 interest, while directing full cooperation from security and regulatory agencies.
“That an order is hereby made directing officers of the Nigerian Navy, Directorate of States Security Services, and the Marine Police to render necessary assistance to the 2nd Plaintiff and the Receiver/Manager to take over the 1″ Defendant’s assets and 2nd Defendants stake in OML 42 JV Activities and all the assets herein in the exercise of his functions under the Deeds of Appointment dated 21″ August 2025.,” The judge ruled.
The motion on notice is yet to be heard. The motion was supported by an affidavit from Babatunde Adewolu of First Trustees Limited and argued in court by Babajide Koku, SAN, and Buchi Ofulue.
Allegations of judicial misconduct
However, defendants challenged the court orders by filing multiple petitions with the Federal High Court Chief Judge and the NJC, alleging that Mr Dipeolu acted with bias and exceeded his judicial authority.
The petitioners contend that the court granted the receiver sweeping powers without evidence that Nestoil and Neconde were dissipating funds.
They also argued that the judge failed to verify ownership of the multi-storey office complex in Victoria Island, legally owned by Drawcok Estates Limited, where both companies are tenants.
The filings noted that some lenders, including Ecobank Nigeria Limited and United Bank for Africa (UBA), dissociated themselves from the suit, appointed their own receivers, and initiated separate legal actions.
The petitions also argued that the issue could disrupt Nigeria’s oil and gas sector. Nestoil and Neconde jointly operate OML 42, backed by a $500 million syndicated loan, and restricting access to operational funds could jeopardise production, salaries, and thousands of jobs.
The defendants said this is not the first instance of aggressive ex parte orders by Mr Dipeolu.
In July, the court issued Mareva injunctions in a separate case involving Neconde and Gobowen Exploration Limited, which were later vacated after criticism that they violated the Companies Winding-Up Rules and Supreme Court precedents.
In a petition filed on 31 October, Nestoil chairman Ernest Azudialu-Obiejesi cited operational and financial disruptions caused by previous orders, including injunctions affecting companies not directly involved in the case.
The filing raised concerns over the sealing of the Victoria Island office complex, which houses tenants such as Julius Berger Plc and Tecon Group, resulting in financial losses.
The petition also questioned the court’s consideration of key evidence, including the ownership and mortgage status of corporate properties, the absence of verified bank statements confirming the alleged $1.1 billion debt, and contractual clauses designating English courts as the preferred forum for disputes for one lender.
The petition alleged that despite these gaps, the court allowed the plaintiffs to sell crude oil and approved recognition of the receiver by the NUPRC.
Nestoil and Neconde’s position
Nestoil and Neconde alleged that the court orders cause operational, financial, and reputational harm.
They urged urgent NJC intervention to ensure fair adjudication.
The petitions alleged that there have been repeated assignments of cases to Justice Dipeolu within 24 hours of filing, arguing that this practice undermines confidence in the court’s impartiality and requested his removal from matters involving Nestoil and its affiliates.
The companies claimed significant contributions to the Nigerian economy, supporting over 2,000 direct jobs, 15,000 indirect jobs, and philanthropic initiatives in health, education, infrastructure, and rural development.
Nestoil reassured stakeholders that operations remain uninterrupted despite the seizure of its headquarters.
“Nestoil remains fully operational across all business lines. Our subsidiaries, projects, and oil, gas, power, and infrastructure commitments continue without disruption.
“We continue to cooperate fully with authorities and financial partners to resolve issues transparently,” the company said.
Court adjournment
The court adjourned the case to 7 November for the substantive motion on notice hearing.
The dispute centres on alleged loan defaults, judicial conduct, and the scope of the court-ordered receivership, raising broader concerns about corporate governance and economic stability in Nigeria.
When the case came up for hearing on Friday, Mr Dipeolu informed the parties that a petition alleging misconduct had been filed against him and forwarded to the Chief Judge, forcing an adjournment.
Chino Obiagwu, SAN, told PREMIUM TIMES on Monday that a campaign is reportedly underway to halt the petition against the trial judge and discredit the Chief Judge of the Federal High Court.
This newspaper also reported that a lawyer familiar with the matter described the petition as “part of an elaborate plot” to discredit and remove Mr Dipeolu to pave the way for a more pliable judge.
“As you know, Justice Dipeolu has a reputation for firmness and integrity,” the lawyer said.
“He granted orders that sent a clear message to delinquent borrowers who have for years defaulted on loan obligations. Some powerful people are unhappy about this.”
