Nova Commercial Bank has initiated legal proceedings against Sunrise Products Limited at the Federal High Court in Lagos, seeking the company’s liquidation due to an outstanding debt of $2,587,891.21 and N276,567,150.63. The bank alleges that despite repeated demands and the issuance of a statutory three-week notice under the Companies and Allied Matters Act, Sunrise Products has failed to settle its obligations. The petition, filed on December 19, 2024, requests the court to grant an order for the winding-up of Sunrise Products Limited. This action underscores the bank’s commitment to recovering the substantial debt and highlights the seriousness of Sunrise Products’ default. The bank emphasizes the urgency of the situation, expressing concern that Sunrise Products might dissipate its assets, thereby jeopardizing the potential recovery of the debt.
Central to Nova Bank’s legal strategy is a motion on notice targeting not only Sunrise Products but also the Central Securities Clearing System Plc (CSCS) and 21 other banks. This comprehensive approach aims to safeguard Sunrise Products’ assets and prevent any actions that could further complicate the debt recovery process. The involvement of the CSCS and multiple banks suggests the potential complexity of Sunrise Products’ financial dealings and the need for a thorough investigation into its assets. The bank seeks an interlocutory injunction to restrain Sunrise Products, its directors, employees, and agents from operating or tampering with its funds held in any financial institution. This measure is intended to freeze the company’s financial activities and preserve its resources pending the outcome of the winding-up petition.
Nova Bank’s petition also includes a request for the court to authorize the advertisement of the winding-up petition in the Federal Government Official Gazette, a national daily newspaper, and other newspapers circulating in Lagos State. This public notification is a standard procedure in winding-up cases, ensuring transparency and allowing any interested parties to be informed of the proceedings. The inclusion of various newspapers aims to reach a wider audience and maximize awareness of the legal action against Sunrise Products. This public announcement serves as a formal declaration of the bank’s intent to pursue liquidation and underscores the severity of the situation for Sunrise Products.
The bank’s motion on notice also calls for the appointment of the Deputy Chief Registrar of the Federal High Court in Lagos as the provisional liquidator of Sunrise Products. This appointment, if granted, would empower the Deputy Chief Registrar to oversee the company’s affairs and operations pending the court’s final decision on the winding-up petition. This interim measure is crucial for ensuring the stability and continuity of Sunrise Products’ business operations during the legal proceedings. It also provides a neutral party to manage the company’s assets and prevent any further depletion of resources. The provisional liquidator would be responsible for safeguarding the company’s interests during this transitional period and ensuring its compliance with legal requirements.
A critical element of Nova Bank’s legal action is the request for the CSCS and the 21 respondent banks to disclose details of all assets held by Sunrise Products. This includes monies, real estate, stock, funds, bonds, cash deposits, bank guarantees, letters of credit, and all negotiable instruments. The bank seeks an order compelling these institutions to provide this information within five days of being notified of the court order. This information is essential for determining the true extent of Sunrise Products’ assets and assessing the feasibility of recovering the outstanding debt. It also helps prevent the concealment or transfer of assets that could hinder the debt recovery process.
Nova Bank emphasizes the urgency of its requests, citing the expiration of the statutory three-week demand notice served on Sunrise Products. The bank argues that Sunrise Products’ failure to respond to the demand notice demonstrates its inability or unwillingness to address the outstanding debt. This reinforces the bank’s argument that winding-up is the necessary course of action to protect its interests and recover the owed funds. The bank contends that the continued operation of Sunrise Products without intervention poses a significant risk to its financial stability and ability to repay its debts. By highlighting the lack of response from Sunrise Products, Nova Bank strengthens its case for the court to intervene and grant the requested orders.
