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Shares purchase:Tony Ganger company slams N500million suit on Quantum Zenith Trustees investments company

Published

1 year ago

June 18, 2022

An Onitsha based Limited liability company TONY GANGER INVESTMENT COMPANY LIMITED has slammed N500 million suit on a member of Nigeria stock Exchange QUANTUM ZENITH TRUSTEES AND INVESTMENT LIMITED over alleged damage suffered by the plaintiff when the defendant retained it’s shares without accounting for them and without generating any profit or income therefrom. In an amended statement of claim, accompanied by sworn statement on oath of it’s managing director Mr. Tony Ozor, filed before a Federal high court sitting in Lagos south west Nigeria by Onitsha based legal practitioner Barrister B.O.Okpemandu,The Tony GANGER Investment Limited Comp alleged thus:

That the defendant formally answered Zenith Security Limited which was the name of the Defendant when the Defendant contracted with the Plaintiff but later Changed its name to QUANTUM ZENITH SECURITIES LIMITED and now QUANTUM ZENITH TRUSTEES AND INVESTMENTS LIMITED. The Plaintiff vide an offer letter dated the 10th of September, 2007 entered into a margin facility contract of N200milliom with the Defendant. The acceptance of offer was signed in Onitsha and duplicate copy was sent to the Defendant in Lagos.

The Plaintiff in the Lagos office of the Defendant caused to be deposited its blue chip shares worth N309Million, as security for the margin facility of N200Million and unspecified shares of the Plaintiff worth N50,050,134.46 which N50,050,134.46 worth of shares did not form or constitute part of the contract the Plaintiff entered with the Defendant and was not used as security for the said margin facility.

The Defendant acknowledged the receipt of the contributory blue chip shares of the Plaintiff worth over N309million and the fact of taking custody of other acquired shares of the Plaintiff worth N50,050,134.46. The Plaintiff pleads that the entire shares the Defendant took custody of were worth over N359,050, 134.46 as at the date of the margin facility contract.

The worth of shares taken custody of by the Defendant was acknowledged by the Defendant in the letter the Defendant addressed to the Visa Consular, United States Embassy, Maitama District, Abuja dated 18th July, 2007 under the hand of Hafford Udochukwu and Yomi Ogunfowora the staff of the Defendant.

The shares above pleaded as at 18th July, 2007 were worth over USD 2,821,612.00

The Defendant produced cash statement of account which showed that the Defendant opened an account for the Plaintiff on 1st July, 2006 and did not deal with the shares of the Plaintiff until about 12th September 2007, a period of about one year and two months the Defendant took custody of the blue chip shares and other shares of the Plaintiff.

Defendant granted N200million facility to the Plaintiff which the Plaintiff through its directors accepted and pleads that the purpose of the margin facility was to enable the Defendant to finance the acquisition and trading of blue chip shares on the floor of the Nigerian stock exchange.

The repayment sources in the alleged N200 million facility the Defendant granted to the Plaintiff were proceeds from sale of shares and cash flow from other sources which did not include nor comprise the N50,050,134.46 acquired shares aforementioned or the N309million worth of blue chip shares used as security.

The Plaintiff pleads that save the Defendant had custody of the acquired shares of the Plaintiff worth N50,050,134.46, there was no time in the margin facility entered between the Plaintiff and the Defendant,that the Defendant was authorized to finance the acquisition and trading of the Plaintiff’s acquired shares of N50,050,134.46.

It was only on the blue chip shares the Plaintiff contracted with the Defendant as a lien to repay the facility and which blue chip shares or security, the Defendant was not allowed to dispose of or trade on during the period of the facility.

The said blue chip shares worth over N309million was to be used as security for the alleged margin of facility of N200 million and available to the Defendant to recover the alleged N200million in the event of a default in repayment of the alleged margin of facility of N200million by the Plaintiff at the end of or the misused tenor of the facility Defendant and not during to be traded period on, or disposed tenor of thereof,

The Plaintiff deposited the above acquired shares with the Defendant when the Plaintiff sought from the Defendant to make confirmation to the Visa Consular, the United States Embassy that the Managing Director of the Plaintiff Mr. Tony Ozor had enough investment in Nigeria to be considered for United States Visa.

The total shares of the Plaintiff with the Defendant amounted to N359,050,134.46 as at 18th July, 2007

out of which its blue chips shares worth over N309Million only was used as security for the purpose of repaying the margin facility and which did not rope the sum of N50,050,134.46 shares of the Plaintiff in the custody of the Defendant into the margin facility the Plaintiff entered with the Defendant on 10th September, 2007.

The defendant who allegedly credited the account of the plaintiff in the sum of N200million on 12th September 2007 charged the account of the plaintiff N500,000.00 alleged to be the processing fee,the charge was contrary to the processing fee of 0.25 percent which was spelt out in the margin facility.

The Defendant from inception of the trading facility kept making monstrous deductions in the account of the plaintiff making it impossible for the alleged margin facility given to the plaintiff to work .

The Defendant did not issue comprehensive statement of account to the Plaintiff and the plaintiff shall at the hearing of this suit urge the court to order the plaintiff to avail to the plaintiff comprehensive statement from 10th of September,2007 till date to enable the plaintiff to retain a chartered accountant to compute the account of the plaintiff in the defendant company to give fair debit/credit balance of the margin facility entered between the plaintiff and the defendant.

The Plaintiff pleads that in line with the offer of a margin facility, the offer was made subject to the availability of funds and the Defendant had the right to call in the facility at any time, furthermore, all transactions in the margin facility were executed or handled by the Defendant,as the defendant continued charging illegal, unjustified and monstrous interest in the account of the Plaintiff and making other deductions to deplete and exhaust the blue chip shares of the plaintiff without making any positive steps to deal with the plaintiff in line with the offer letter, purpose which formed the basis contract between the plaintiff and the defendant.

The Defendant mismanaged the margin facility and traded on the Plaintiff’s aforesaid Blue chips shares used as security without the consent and authorization of the Plaintiff during the tenor of the facility.

The Defendant without any further communication to the Plaintiff on 8th

August, 2019 sold some shares of the Plaintiff and acquired Federal Government Bond of unspecified amount of money in the name of the Plaintiff to be managed or to be mismanaged by the Defendant in the name of the Plaintiff and to the credit of the Defendant.

The Defendant dealt with the blue chip shares of the Plaintiff in total disregard of the provision in the offer letter which stipulated that the margin facility was to be drawn after three hundred and sixty day.

The Defendant mismanaged the entire transaction and traded with blue chip shares of the Plaintiff used as security without the consent and authorization of the Plaintiff and is still in custody of the aforementioned N50,050,134.46 worth of shares which it has unduly retained.

The Plaintiff was not and is not indebted to the Defendant in any sum at all.

The Defendant after misusing the blue chip shares of the Plaintiff used as security is selling shares of the Plaintiff and have unduly retained the N50,050,134.46 worth of shares of the Plaintiff

From the foregoing, the Plaintiff seeks the following reliefs from the Defendant;

An order of the Court directing Quantum Zenith Trustees and investment company to send comprehensive cash statement of account to the Plaintiff to enable the Plaintiff retain a Chartered Accountant to compute the account of the Plaintiff to enable the Plaintiff determine the fair balance in the margin facility the Plaintiff entered with the Defendant.

An order directing the Defendant to pay the Plaintiff any shortfall or credit balance in the account of the Plaintiff after the computation of the account by a chartered accountant.

An order directing the Defendant to return the Blue chips shares of the Plaintiff sold by the Defendant without the authorization of the Plaintiff during the tenor of the Margin Facility.

An order directing that the acquired shares of the Plaintiff N50,050,134.46 which the Defendant took custody of which did not form part of the margin facility be returned to the Plaintiff forthwith.

An order restraining the Defendant by itself, agents, privies, assigns from further acquiring, de-acquiring and trading in the blue chip shares of the Plaintiff and in the other acquired shares of the Plaintiff at all times and for all purposes.

Alternatively

N500,000,000.00 damages which comprised the market value of the blue chip shares and the other shares of the Plaintiff acquired by the Defendant without consideration including damages suffered by the Plaintiff when the Defendant retained the shares of the Plaintiff without accounting for them and without generating any profit or income therefrom.

Interest from the date of judgment until the above sum is liquidated

However, in a statement of defence accompanied by statement on oath sworn to by a compliance officer of the defendant Adewale Ajala and filed before the court by a Lagos lawyer,Chinasa Unaegbunam on behalf of Quantum Zenith Trustees and investments Limited,the defendant stated that:

In response to the Statement of Claim the Defendant avers that its letter to the United States Embassy of 18th July 2007 only reflected the value of the Plaintiff’s portfolio with the Defendant as at the date of the issuance of the letter. The Defendant states that it did not take custody of any shares worth N50,050, 134.46 as alleged by the Plaintiff.

Between 19th July 2007 and 31st August 2007, the Plaintiff made several purchases and sales of shares forming part of his portfolio as well as inflows and outflow of funds.

The Plaintiff requested for a margin facility in the tune of N200million on or about 30th August 2007. As of 31st August 2007, when internal approval was sought and granted for the facility, the market value of the Plaintiff’s blue-chip shares listed on the approval document was in the sum of N309,672,000. Three (3) non-blue-chip shares and shares below a value threshold, with a market value of N3,955,302,00 were not included, The Plaintiff was also indebted to the Defendant to the tune of N3,470,306.38. This portfolio as at the date of the grant of the Facility and shares to be acquired by the Facility formed the collateral for the Facility granted to the Plaintiff.

The Defendant did not take custody of any shares as alleged or at all and the Plaintiff actively traded in shares throughout the period in question.

Given the Plaintiff’s trading activity and the differences and fluctuations in sale and purchase prices; the value of the Plaintiff’s portfolio was not static but had declined as at the date of approval of the Facility. The entire portfolio at the date of approval formed the collateral for the Facility granted to the Plaintiff.

The Defendant states that there was no credit of N200million into the Plaintiff’s account. The grant of a margin facility signifies the extension of a line of credit of up to N200million which the Plaintiff can draw on for the purpose of purchase of shares. Further, the deduction of the sum of N500,000 (Five Hundred Thousand Naira) was in line with the terms of the Facility which was accepted by the Plaintiff and the said sum represents 0.25% of the facility sum which is the processing fee.

The Defendant denies the allegation of “illegal and monstrous deductions”or any unjustifiable deduction from the Plaintiff’s trading account averred by the Plaintiff.

The Defendant avers that the Plaintiff’s suit is unmeritorious, speculative, vexatious and should be dismissed with costs as the Plaintiff is not entitled to any of the reliefs sought.

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Stamp Duty Is Revenue Stamp, Not Postage Stamp, LIRS Chief Clarifies

Published

2 days ago

September 26, 2023

D'SHOW

The Special Adviser to the Executive Chairman of the Lagos State Internal Revenue Service, LIRS, Mr Tokunbo Akande has clarified the misunderstanding about stamp duty as he maintained that it is a revenue stamp and not a postage stamp.

Akande made this known while featuring as a guest on The Tax Talk programme on Channels Television recently.

He said contrary to public opinion, stamp is not just for courier services as it is meant to certify the underlying transaction between two entities, whether they are corporate entities or individuals, thus, the framework for stamp duty is to verify the documents for underlying transactions and ensure that they are admissible in court in case any disputes arise.

Akande noted; “It’s interesting to note that stamp duty, a tax law that dates back to 1939, is still in effect today. Although it was reenacted in 2004 and has been updated over time through the Finance Act, the basic premise remains the same.

“Stamp duty places the responsibility on those involved in certain transactions to provide documentation that explains the details of the transaction. For example, if someone purchases an item from another person, a receipt is given to show the transaction. This receipt must be stamped to be considered admissible evidence in court in case any disputes arise. In the past, the postal stamp was used to denote the stamp duty.”

Akande, who noted that Stamp duty has contributed significantly to revenue generation in Lagos State, as the state has generated over N5 million from stamp duty over the past few years, said the agency believes there is still room for improvement.

While stating that the agency is considering the introduction of revenue stamps for wholesalers and distributors for receipts over N10,000 in the state, he noted; “This approach was previously utilized in the 1970s, and we are eager to revitalize it. We are fully committed to engagement and process improvement.

He said the agency has taken the step of digitizing its stamp duty operation by transitioning from manual to electronic processes.

According to Akande, “The Joint Tax Board (JTB), which oversees all Internal Revenue Services (IRSs), the Federal Inland Revenue Service (FIRS), customs, immigration, and other related bodies, has been at the forefront of promoting awareness about stamp duty in general.

“LIRS (Lagos State Internal Revenue Service) has also made significant efforts in this area by holding town hall meetings, issuing public notices and guidance notes, and engaging with professional bodies. However, despite these efforts, the message has not been fully received. It is important to note that the law requires that all transactions between two entities must be stamped, and even items such as cheques have a small stamp on them. This is because they may be admissible in court. Therefore, it is your responsibility to ensure that any documents related to transactions above a certain level of expenses are properly stamped, as failure to do so renders them as ordinary paper.

He said LIRS has expanded its presence across various states, with offices conveniently located to better serve taxpayers as its officials are proud to offer assistance with legal proceedings and have desks located in all the courts of Lagos.

“Our team of experts ensures that all necessary documents are properly stamped and verified by the commissioner for stamp duty. We take record-keeping seriously, as it helps to ensure the authenticity of all documents that pass through our hands. Proper stamping of documents is essential, whether you’re borrowing money from a bank or renting a property. Failure to do so could render them inadmissible in court. We are here to help certify your documents and ensure they have the necessary stamps to make them legally binding,” Akande submitted.

Business

FELA BANK-OLEMOH’S VISION FOR A BRIGHTER FUTURE: INTRODUCING FBO TRAINING AND RESEARCH CENTRE PROJECT

Published

2 weeks ago

September 12, 2023

D'SHOW

A transformative approach to a better future for young leaders driven by the vision and dedication of a remarkable individual – Fela Bank Olemoh. His passion for enhancing the lives of the average Nigerian has been the driving force behind the FBO Training and Research Centre, an organization poised to redefine the landscape of capacity building and training in Nigeria and across Africa.

For the past eight years, Fela Bank Olemoh has been unwavering in his commitment to facilitating the implementation of several award-winning human capacity development initiatives. These initiatives, including ReadySetWork, CodeLagos, Eko Nke Koo (Lagos is Learning) and Project TMax, have collectively transformed the lives of thousands of young Nigerians. Through these initiatives, Fela Bank Olemoh has brought empowerment and opportunity to countless individuals, providing them with the skills and knowledge needed to thrive in today’s fast-paced world.

Exciting news is on the horizon as the FBO Training & Research Centre prepares to launch its inaugural training programs in October. What sets this program apart is that they are entirely free!

The program will offer the following courses: Web Development, Virtual Assistance, and Data Analytics.

Prospective participants can start to register via the registration portal as registration is set to end on 22nd September, 2023.

With a limited admission capacity of 120 participants for the October and November Cohorts, Fela Bank Olemoh and his team ensure a personalized and impactful learning experience for each participant. For those who may not secure a spot in the upcoming Cohort, Fela Bank Olemoh and the FBO Training & Research Centre have a waiting list in place. This thoughtful approach ensures that everyone eager to embark on this transformative journey has an opportunity to do so in the near future.

We implore every youth to be a part of this project as this is a lifetime opportunity to build a solid future for themselves.

To join this cohort, register using the link
www.fbocentre.com/register
Limited slots available!

7th ACT Foundation Breakfast Dialogue Set to Illuminate Path to Sustainable Development in Africa

Published

2 weeks ago

September 12, 2023

D'SHOW

The Aspire Coronation Trust (ACT) Foundation is gearing up to host the highly-anticipated 7th ACT Foundation Breakfast Dialogue (BFD) on October 5th, 2023, at the prestigious Lagos Oriental Hotel, Lekki Expressway, Victoria Island, Lagos.

The ACT Foundation Breakfast Dialogue has become a marquee event, drawing luminaries from diverse sectors, to tackle pivotal issues surrounding sustainable development in Africa. This year, the event takes on even greater significance as it zooms in on the transformative potential of Economic, Social, and Governance (ESG) strategies in advancing sustainable development.

Themed ‘Advancing Sustainable Development in Africa: Unleashing the Power of Environmental, Social, Governance Strategies for Impact, this year’s Breakfast Dialogue aspires to bring together an eclectic mix of leaders representing various sectors, all poised to engage in a deep dive into how ESG principles can be leveraged to propel the sustainable development of organisations and, consequently, Africa’s broader sustainable development agenda.

Osayi Allie, CEO of ACT Foundation, underscored the significance of this event, remarking, “The 7th ACT Foundation Breakfast Dialogue promises to be a game-changer, offering a unique platform for leaders in the public, private, and social sectors to decode the immense potential that Economic, Social, and Governance principles hold for organisations of various scales. Effective implementation of ESG practices by African institutions can make a monumental contribution to achieving sustainable development across the continent.”

The event’s keynote speaker, Oyeyimika Adeboye, Managing Director, West Africa, Mondelez International, will take centre stage to share her profound insights on this pivotal subject. She will be joined by an esteemed lineup of speakers, including Marilyn Obaisa-Osula, Associate Director, ESG and Sustainability Services, KPMG; Dr. Eugene Itua, CEO of Natural Eco Capital; Tendai Matika, Manager of the Global Reporting Initiative, Africa; and Mudrakat Alabi-Macfoy, Head of Sustainability and Circularity at Lagos State Waste Management Authority (LAWMA).

One of the day’s highpoints will be the unveiling of the finalists and winners of the 2023 ACT Foundation Changemakers Innovation Challenge. These exceptional individuals and organisations will secure grant funding and technical support from ACT Foundation, empowering them to amplify their innovative solutions and projects within targeted communities.

Interested participants can click here to register for the virtual session.