Supreme Court Voids Asset Freeze on Nestoil, Neconde in $2 Billion Debt Dispute

Nigeria’s Supreme Court has overturned a Court of Appeal order that froze the assets of oil firms Nestoil Limited and Neconde Energy Limited in a protracted debt recovery dispute involving more than $2 billion.

In a unanimous judgment delivered on Monday, a five-member panel of the apex court held that the Court of Appeal exceeded its jurisdiction when it granted an ex parte application that effectively froze the companies’ assets and operations.

Delivering the lead judgment, Stephen Adah ruled that the appellate court assumed powers it did not possess, noting that the matter was not properly before it when the order was issued.

The Supreme Court further criticized the Court of Appeal for granting an interim injunction and staying proceedings at the Federal High Court in Lagos, a move it said resulted in two courts handling the same matter simultaneously.

According to the apex court, granting an interim injunction before an appeal had been formally entered was “misconceived” and amounted to a misuse of judicial process.

The court also expressed concern over the growing use of ex parte orders in commercial disputes, describing the Court of Appeal’s intervention as particularly troubling because there were no exceptional circumstances or urgency warranting such drastic action.

Consequently, the Supreme Court declared the appeal filed by Nestoil and Neconde meritorious and set aside the appellate court’s orders.

The dispute arose from debt recovery proceedings instituted by lenders, including FBNQuest Merchant Bank Limited and First Trustees Limited, over financing arrangements linked to oil assets and operations.

In October 2025, the Federal High Court in Lagos granted a 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 had lapsed after 14 days under the Federal High Court Civil Procedure Rules once an application to discharge it was filed.

On November 20, 2025, Justice Daniel Osiagor ruled that the ex parte order had expired by operation of law. A week later, the Court of Appeal restored control of the companies’ assets to a receiver-manager appointed by the banks, a decision that has now been effectively nullified by the Supreme Court.

Monday’s ruling follows an earlier Supreme Court judgment delivered on April 10, which restored the companies’ right to retain legal counsel of their choice while contesting the receivership.

In that decision, the apex court held that allowing lawyers appointed by the receiver-manager to simultaneously represent the companies created a conflict of interest and undermined their right to independent legal representation. The ruling reinstated senior advocates Wole Olanipekun and Muiz Banire as counsel for the firms.

The legal battle remains one of Nigeria’s most significant commercial disputes, with lenders alleging that Nestoil, Neconde, and their promoters owe more than $2 billion alongside additional liabilities estimated at over ₦430 billion under various financing agreements tied to oil operations.