The Supreme Court has set aside an order of the Court of Appeal freezing the assets of Neconde Energy Limited, Nestoil Limited and two others, over an alleged $1.1 billion indebtedness to a consortium of banks led by FBNQuest Merchant Bank Limited and First Trustees Limited.

A five-member panel of the apex court in a judgement on Monday, held that the three-member panel of the appellate court went beyond their powers in granting an exparte application against the appellants.

Recall that the Court of Appeal had on November 29, 2025, granted an interim restorative injunction returning the control of Nestoil’s assets and operations to the Receiver Manager appointed by the banks.

Besides, the appellate court further issued an order freezing the assets of the oil servicing firms, pending the hearing of the substantive suit, and a further stay of proceedings at the trial court.

The order was following an exparte application by the bankers seeking a takeover of the oil firms, over the alleged debt.

Dissatisfied, Neconde, Nestoil and their promoters (Dr Ernest Azudialu-Obiejesi OFR and Mrs Nnenna Azudialu-Obiejesi), approached the Apex court to reverse the order of the appellate court issued against their assets.

Delivering judgement in the appeal, the five-member panel of the apex court agreed with the submissions of Neconde and Nestoil that the lower court erred in law in “entertaining the matter in the manner it did” and their subsequent issuance of an exparte order without any justification.

According to Justice Stephen Adah who delivered the lead judgement, records before the Supreme Court showed that the process of transmitting an appeal was not yet completed as at the time the appellate court assumed jurisdiction.

While emphasizing that a Notice of Appeal does not amount to a stay of proceedings, the apex court wondered how the lower court could entertain an exparte in a matter that it was not seized of.

“If there was a Notice of Appeal what necessitated its withdrawal for an exparte”, the apex court queried, before warning that courts must be vigilant, circumspect and discreet in issuing exparte orders.

Besides, the apex court faulting the lower court further stated that, “no exception, cause existed nor urgency disclosed that would have warranted the withdrawal of the Notice of Appeal, adding that the exparte order was unwarranted, uncalled for, frivolous and vexatious.

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Noting that abuse of exparte has become a thing of great concern to the judiciary, Justice Adah urged the appellate court against making itself available in such conducts that undermines judiciary.

According to him, the appellate court went ahead to make far reaching order into the substantive matter, while sitting in an interlocutory appeal.

“It was granted at a time when the appeal had not been entered….an appellate court can only be seized of a matter when the appeal has been fully entered.

“Mere filing of a Notice of Appeal does not apply as stay”, Supreme Court held, while pointing out that the substantive matter was still going on at the trial court.

He also warned litigants who use appeal as a tool to frustrate court proceedings and pursue endless litigations, wondering how the bankers who had dragged the oil firms to court can turn around at the appellate court to seek a stay of proceedings at the trial court.

On the first issue, the Supreme Court held, inter alia, that there was no basis or exceptional circumstance warranting the grant of the ex parte order. The Court further held that it was wrong for the Court of Appeal to entertain and grant the application when the records of appeal had neither been transmitted nor the appeal entered, as the trial court remained seized of jurisdiction.

“The first issue is resolved in favour of the appellants”, Justice Adah held.

On the second issue, the Supreme Court held, inter alia, that the application for stay of proceedings brought by the 1st and 2nd Respondents was not made in good faith. The Court observed that the order effectively paralysed proceedings before the trial court and that there was no basis upon which the stay could be sustained.

The apex court held that it found no “compelling justification for the order”, adding that the order only “constitutes misuse of court processes”.

“This appeal is meritorious and it is accordingly allowed…the exparte order issued by the Court of Appeal on November 29, 2025, is accordingly set aside”, Adah declared.

Recall that Justice Dehinde Dipeolu of the Federal High Court in Lagos, had on October 22, 2025 granted an exparte order against Nestoil, Neconde Energy Limited, and the company’s principal promoters — Dr Ernest Azudialu-Obiejesi and Mrs Nnenna Obiejesi.

The court also barred the defendants from accessing funds, shares, or assets held in banks and financial institutions.

In addition, Justice Dipeolu also authorised First Trustees Limited and FBNQuest Merchant Bank Limited, representing a consortium of creditor banks, to take possession of Nestoil’s Assets under receivership.

However, the case was subsequently transferred to Justice Daniel Osiagor, who on November 21, vacated the Mareva injunction on grounds among others that the 14-day order had lapsed.

Dissatisfied, the bankers approached the appellate court to set aside the lifting of the merava injunction.

Delivering ruling on November 29, 2025, the Appeal Court ruled in favour of FBNQuest Merchant Bank Limited and First Trustees Limited, and issued a restorative injunction reversing Justice Osiagor’s decision.

It should be stated that the Supreme Court a few months ago, had also overturned the appellate court’s decision on legal representation and restored the Oil companies right to legal Counsel of their choice while challenging the validity of the receivership itself.

In the lead judgement delivered by Justice Mohammed Baba Idris, the apex court had described it as a “legal anomaly” for lawyers appointed by the receiver-manager to simultaneously represent the companies whose interests were being contested.

The apex court had held that permitting such representation created a clear conflict of interest and undermined the companies’ right to independent legal representation.

Nestoil’s victory is more than a legal triumph. It is a reaffirmation of justice and restoration of order.