The Court of Appeal in Lagos has nullified a 2013 ruling that granted Guaranty Trust Bank (GTBank) the right to foreclose on a N30 billion, 44-room luxury mansion in Ikoyi, Lagos, owned by Alhaji Agboola Abiola, son of the late business mogul and statesman, Chief Moshood Kashimawo Olawale Abiola.
In a landmark ruling delivered in Appeal No. CA/L/888/2014, the appellate court unanimously agreed that the Federal High Court erred in its judgment by failing to thoroughly assess allegations of fraud and forgery surrounding the mortgage documents presented by the bank.
Justice Paul Aimee Bassi, who read the lead judgment, with concurring opinions from Justices Polycarp Kwahar and Abdulaziz Anka, faulted the validity of the mortgage instrument GTBank relied upon, citing “glaring irregularities” and a “failure of due diligence” on the part of the lower court.
“The trial court ruled on a document whose authenticity was seriously in question,” Justice Bassi ruled. “This appeal succeeds. The judgment of the Federal High Court delivered on June 20, 2014, is hereby set aside.”
Contentious Mortgage Deal
The dispute arose from a June 20, 2014, judgment in favor of GTBank, which had sought legal rights over the Ikoyi property in connection with two loans — N508 million and N1 billion — allegedly obtained by RCN Networks Ltd, a company linked to Abiola. The bank claimed that the property was mortgaged as security.
However, Agboola Abiola, represented by Dr. Charles Adeogun-Phillips (SAN), denied ever signing the tripartite legal mortgage document. He argued that the page bearing his purported signature had been fraudulently extracted from a different agreement and inserted into the mortgage deed.
Additionally, the appellants alleged that GTBank improperly merged the two loans without their consent and attempted to use a single deed of legal mortgage to enforce foreclosure on the property, despite separate terms for each loan.
Forgery Allegations and Flawed Documentation
A major point of contention was the execution page of the mortgage deed, which bore pagination inconsistent with the rest of the document — labeled “11 of 17” while the main pages were marked from “2 of 9” to “9 of 9.” The court ruled that this discrepancy cast serious doubt on the authenticity of the mortgage.
Although police investigations produced conflicting conclusions — one recommending arbitration and another dismissing forgery allegations — the appellate court maintained that the inconsistencies were too significant to be overlooked.
“A document of disputed authenticity cannot be relied upon to determine legal rights and obligations,” Justice Bassi stated, condemning the trial court for focusing solely on interpreting a single clause of a flawed contract.
No Foreclosure, No Costs
With this ruling, GTBank’s effort to take possession of the Ikoyi property has been quashed. The court further ruled that both parties should bear their own legal costs.
This decision not only highlights the judiciary’s increasing scrutiny of financial institutions’ foreclosure practices but also reinforces the importance of document integrity in legal transactions.
