Supreme court upholds AMCON’s £10.5m sale of Lagos Continental Hotel

The Supreme Court has affirmed the statutory powers of the Asset Management Corporation of Nigeria (AMCON) regarding the sale of the Lagos Continental Hotel, bringing an end to a high-stakes, multi-year legal battle.

In a landmark judgment delivered on February 20, the court ruled in favour of AMCON, 11 Hospitality Plc, and Polaris Bank Limited, dismissing the challenges brought forward by Milan Industries Limited. The ruling effectively validates the N22 billion (£10.5 million) disposal of the luxury asset.

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Background of the dispute
The litigation originated from a credit facility advanced by the defunct Skye Bank Plc (now Polaris Bank) to Milan Industries Limited for the construction of the hotel, located on Victoria Island, Lagos. Following the borrower’s failure to service the debt, AMCON acquired the Eligible Bank Asset (EBA) in September 2018.

Prior to AMCON’s intervention, the bank had appointed Kunle Ogunba (SAN) as Receiver-manager to recover the non-performing loan. Upon the acquisition of the debt, AMCON validated Ogunba’s appointment, subsequently disposing of the property to 11 Hospitality Plc under the powers granted by the registered Deed of Legal Mortgage.

The obligor, Milan Industries, initially challenged the sale at the Federal High Court, which dismissed the suit.

However, the Court of Appeal later overturned that decision, ruling in favour of the company.

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The matter eventually reached the Supreme Court, which has now set aside the appellate court’s judgment. The apex court emphasised that the AMCON Act serves as a “special law” designed by the National Assembly to address the unique exigencies of the financial sector.

The judgment
In its ruling, the Supreme Court clarified that the interpretation of the Act must reflect its specific remedial purpose.

The court upheld Section 60 of the AMCON Act, which exempts the corporation from paying stamp duties, and validated AMCON’s rights as a mortgagee regardless of the “upstamping” status of the documents.
The court further held that as long as an outstanding debt exists, AMCON maintains a “continuing security interest” in the mortgaged assets.

By upholding the sale of the Lagos Continental Hotel, the Supreme Court has reinforced the corporation’s mandate to recover public funds through the disposal of collateral. With the delivery of this final verdict, legal experts note that the ownership of the Victoria Island landmark is now permanently settled.