$242m Petroleum Products Dispute: Court Grants UBA Interim Asset Freeze Against Vitol

A Lagos State High Court has granted interim preservative orders against Vitol SA, a Switzerland-based energy trading company, following a $242 million petroleum products dispute brought by United Bank for Africa (UBA) Plc.

The orders, granted last Thursday by Justice K. A. Jose, include measures to restrain the dissipation of assets and dealings with funds up to the disputed amount.

UBA alleges that petroleum cargoes consigned to its order under bills of lading were wrongfully released to another party instead of being delivered to the bank.

In her ruling, Justice Jose granted three prayers sought by UBA, stating: “Prayers 1–3 are granted as prayed against the 2nd Respondent only.”

The application was brought under Order 43 Rule 1 of the High Court of Lagos State (Civil Procedure) Rules 2019 and the Lagos State High Court Practice Direction No. 2 of 2019.

UBA’s lead counsel, Bode Olanipekun, SAN, urged the court to grant the interim orders to preserve assets pending the determination of the substantive dispute.

In an affidavit supporting the application, the bank’s Group Head of Recoveries and Remedial Management, Anthony Chilaka, said UBA had issued a letter of credit for the benefit of Vitol SA to facilitate a petroleum products transaction.

According to the affidavit, the cargo was transported to Nigeria, and the vessels’ masters issued bills of lading subsequently endorsed by Vitol “to the order of” UBA. The bank said the original documents were handed over to it, entitling it to take possession of the cargo upon completion of the voyage.

“The applicant has not been given possession of the gasoil despite completion of the voyage,” the affidavit stated.

UBA alleged that the petroleum products were instead applied to the use of another party, arguing that the failure to deliver the cargo amounted to conversion and negligence.

The bank is seeking to establish in the substantive proceedings that Vitol SA and the owners of the vessels are liable for alleged conversion, misrepresentation and negligence arising from the non-delivery of the products.

The application also cited 34 financial institutions and public agencies, including commercial banks, merchant banks, microfinance banks, the Nigerian Ports Authority and the Nigeria Customs Service.