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Court Strikes Out Midwestern Oil’s Suit Against Consent Judgement

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A Delta State High Court sitting at Sapele, has struck out the “Stakeholder Interpleader” Suit jointly filed before the Court by an indigenous oil company Midwestern Oil and Gas Company Limited against three Respondents to forestall the enforcement of a consent Judgment of the Federal High Court sitting in Lagos.

In his ruling striking out the Suit, the Presiding Judge, Justice A.O Omamogho, held, “the filing of this suit amounted to an abuse of court process having regards to the various definitions of what amount to an abuse of court process, and the facts that this court is being vested with the power that it does not possess to review the consent judgement.

“The only course open to this court is to strike out the suit in the circumstances, this case herein struck out with the cost of N200,000 to each set of defendants in this case.” Justice Omamogho further said Seistech and Midwestern had amicably settled a windingup suit instituted by Seistech against Midwestern in the Federal High Court, in Lagos on the 12th February, 2018, the terms of settlement drawn up and executed by both parties and counter signed by their lawyers was entered as Consent Judgment by the presiding Judge, Justice Babs Kuewumi.

Midwestern Oil and Gas Company Limited had dragged three Respondents, Seistech Energy Limited, Sapele Power Plc and Nigeria Electricity Liability Management Company Ltd/GTE, before the court seeking to overturn the judgement in a previous suit between the Company and Seistech Energy Limited.

But the judge ruled that by the terms of the Consent Judgment, Midwestern was to evacuate its crude oil from Seistech’s storage within a particular period and pay storage fees at a particular rate. “It was also agreed that if Midwestern failed to evacuate its crude within the specified period, it would then be liable for a higher storage fee until evacuation.

Midwestern failed to evacuate the crude within the stipulated timeline and storage fees accrued, as per the Consent Judgment, to over US$3Million, as at the date of Midwestern’s filing of its Stakeholder Interpleader Summons in the Sapele High Court.

However, to avoid its mounting obligations under the Consent Judgment, Midwestern through the law firms of Perchstone and Graeys and Templars instituted another suit in Sapele against Seistech and two other parties, in order to limit its period of liability for storage fees and claiming it did not know which, of the three (3) Defendants, to pay the reduced storage fees to.

In filing this action, Midwestern concealed the fact that there was a subsisting Consent Judgment over the issue of payment of storage fees. Midwestern then sought injunctive orders against the Defendants, including Seistech, which would have had the effect of completely varying the terms of the Consent Judgment if granted.

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