Court dismisses Petrocam’s bid to change N9.05bn security order

Justice Akintayo Aluko of the Federal High Court sitting in Lagos on Wednesday dismissed an application by Petrocam Trading Nigeria Limited and other defendants seeking to vary an order requiring them to provide a bank guarantee or bond as security for a disputed N9.05bn claim.

Justice Aluko held that the application, filed on July 15, 2026, amounted to an abuse of court process, as it sought to indirectly discharge, set aside or overturn an earlier ruling delivered after the parties had been heard.

The judge held that the defendants could not disguise an attempt to reopen a substantive decision as an application for variation before the same court.

The ruling followed a dispute in which the claimant sought to preserve funds allegedly owed to it by Petrocam and the other defendants.

On March 30, 2026, the court granted an interim injunction restraining dealings with the defendants’ bank accounts to the extent of the claimant’s alleged N9,057,511,855.63 claim.

The defendants subsequently challenged the order.

In a ruling delivered on May 4, 2026, the court refused to discharge the injunction, but modified the arrangement by allowing the defendants to secure the disputed claim with a bond or guarantee from a reputable bank.

The court directed the defendants to provide a bond or guarantee in the sum of N9,511,185,353.53 and required the claimant to give an undertaking as to damages.

Dissatisfied with the conditions, the defendants filed the July 15 application seeking, among other reliefs, an extension of time to comply with the May 4 order and an order varying the conditions by replacing the requirement for a bank guarantee or bond with another form of undertaking.

The application was heard on August 27, 2026, after counsel for the parties adopted their respective written addresses.

While determining the application, the judge considered whether the circumstances relied upon by the defendants justified varying the conditions imposed in the May 4 ruling.

Justice Aluko rejected the defendants’ reliance on Order 26 Rule 9(1) and (2) of the Federal High Court (Civil Procedure) Rules 2019.

The judge held that the provision applied to the variation or discharge of an order made upon an ex parte application, whereas the order the defendants sought to vary had ceased to have that character.

According to the court, although the initial injunction of March 30 was granted ex parte, the defendants subsequently challenged it, resulting in a contested hearing involving all the parties.

Justice Aluko said the May 4 ruling was therefore delivered after hearing both sides and could no longer be treated as an ex parte order.

The judge held that the court had already exercised its discretion in the May 4 ruling by modifying the interim injunction and allowing the defendants to protect their interests through a bank guarantee or bond.

Consequently, the court rejected the argument that Order 26 Rule 9 could be invoked to reopen the issue.

The judge agreed with the claimant’s counsel that the May 4 ruling had effectively changed the character of the initial ex parte order.

Justice Aluko held that the March 30 order had assumed the status of an inter partes order after the defendants were heard and the court delivered its considered ruling on May 4.

The court further held that the defendants’ latest application was, in substance, an attempt to discharge the May 4 ruling through another route.

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The judge noted that the defendants had earlier sought to discharge the March 30 injunction and that the court had considered and determined that application in its May 4 ruling.

By asking the court to remove the security condition imposed in that ruling, the defendants were effectively seeking to obtain the same relief indirectly, the judge held.

Justice Aluko, however, held that the procedure was an abuse of the court process.

The court also rejected the defendants’ contention that their counterclaim constituted a basis for discharging or varying the injunction.

The judge held that the existence of a counterclaim did not, by itself, extinguish the claimant’s right to seek preservation of its alleged claim pending the determination of the substantive dispute.

According to the court, an interlocutory injunction is meant to preserve the subject matter of litigation and prevent a judgment from being rendered nugatory.

Justice Aluko said the March 30 order, as modified by the May 4 ruling, was intended to secure the claimant’s alleged N9.05bn claim pending the determination of the substantive proceedings.

The judge therefore found no basis for discharging the order merely because the defendants had a counterclaim.

The court also considered the undertaking as to damages required from the claimant.

Justice Aluko explained that such an undertaking was designed to protect a party against whom an interlocutory injunction had been granted where the injunction was subsequently found to have caused compensable loss or damage.

The judge noted that the May 4 ruling had already directed the claimant to provide an undertaking as to damages and that the defendants had failed to establish sufficient grounds to set aside or replace the conditions.

Justice Aluko further rejected the attempt to use the latest application as a means of reviewing the court’s earlier decision.

The judge stressed that a court of coordinate jurisdiction does not ordinarily have the power to sit on appeal over its own decision.

The court held that the proper avenue for challenging such a decision was an appellate court, except in recognised circumstances, such as where the original decision was made without jurisdiction.

Justice Aluko noted that the defendants had already appealed against the May 4 ruling.

The judge therefore held that, having invoked the appellate jurisdiction of the Court of Appeal, the defendants could not simultaneously ask the trial court to reconsider the same decision through a fresh application for variation.

According to the court, allowing such a procedure would enable a litigant to circumvent the appellate process by inviting the trial court to reconsider and reverse a decision already placed before the Court of Appeal.

The court consequently held that the July 15 application was incompetent and constituted an abuse of court process.